ESDS Fund Raise and IPO Planning

Document Summary

The document is a notice for an extra-ordinary general meeting of ESDS Software Solution Limited, scheduled for January 25, 2025, with the agenda encompassing ordinary and special business resolutions.

Ordinary Business: Reclassification of Authorized Share Capital

• A resolution is proposed to reclassify the company's existing authorized share capital of ₹46,00,00,000, consisting of equity shares of ₹1/- each and preference shares of ₹100/- and ₹10/- each with varying dividend rates, into ₹46,00,00,000 consisting solely of equity shares of ₹1/- each.
• A further resolution seeks approval to amend the Memorandum of Association to reflect this reclassification, updating the capital clause (Clause V. a) to state that the authorized share capital is ₹46,00,00,000 divided into 46,00,00,000 equity shares of ₹1/- each, granting the company power to increase or reduce capital and re-divide shares.
• Reclassified equity shares will rank pari-passu with existing equity shares. Mr. Piyush Somani, Ms. Komal Somani and Mr. Prasad Deokar are authorized to implement the resolution.

Special Business:

1. Issue of Equity Shares on a Preferential Allotment / Private Placement Basis:

• A special resolution proposes to issue 30,96,378 equity shares of face value ₹1/- each at an issue price of ₹225/- per share (including a premium of ₹224/- per share), aggregating up to ₹69,66,85,050, on a private placement basis through preferential allotment.
• This offer includes existing shareholders with pre-emptive rights and Mr. Mukul Agrawal being offered 22,22,222 equity shares as per investment agreement dated 10th December 2024.
• A Private Placement Offer Letter in Form PAS-4 will be issued and invitation will be recorded in Form PAS-5. The board is authorised to issue offer letter and authorised officers are to file return of allotment in Form PAS-3.
• The valuation reports dated December 2, 2024, valuing shares at ₹225/- each, are taken on record.
• The funds are proposed to be used for repaying existing debt, business expansion, investments, and general corporate purposes.
• Shares are proposed to be issued for consideration of ₹225/- each i.e. having a face value of ₹ 1/- each issued at a premium of ≈ 224/- per share.
• The proposed time within which the Preferential cum Private Placement of Equity Shares shall be completed is within the 60 days from the date of the passing of the special resolution.

2. Approve Issuance of Employee Stock Options to the Employees of the Company:

• A special resolution proposes the adoption of "ESDS Employees Stock Ownership Plan- 2024 ("ESOP Plan 2024")"
• A maximum of 30,00,000 employee stock options, corresponding to 30,00,000 equity shares of ₹ 1/- each of the Company.
• All present or future eligible employees of the Company, whether in India or overseas shall be eligible. The options shall be granted to the employees as per the performance appraisal system of the Company.
• Options shall vest so long as the employee continues to be in employment of the Company, not earlier than minimum period of 1 year. Vested options can be exercised anytime within 3 (three) years from the date of vesting during the exercise window opened by Nomination and Remuneration Committee.

3. Alteration of Article of Association of the Company:

• A special resolution proposes to substitute the existing articles of association of the Company with a new set of articles to align with the requirements of SEBI, the Companies Act, 2013, and the Securities Contracts (Regulation) Rules, 1957.

4. Approval for the Initial Public Offer (IPO) of the Company:

• A special resolution seeks approval for an initial public offering of equity shares of face value of ₹1 each, aggregating up to ₹600 Crores, through a fresh issuance, with an over-subscription option and a green shoe option and/or a pre-IPO placement.
• The offering may include reservations for employees and discounts for retail investors.
• The Board is authorized to determine the terms of the issue, appoint book running lead managers ("BRLMS"), and take necessary actions, subject to regulatory approvals.
• A pre-IPO placement of Equity Shares (“Pre-IPO Placement") to certain investors aggregating up to an amount of ₹120 Crores and at such price as the Board may determine.

5. Approval for Increasing the Limit of Investment by Non-Resident Indian or Overseas Citizen of India in the Share Capital of the Company:

• A special resolution proposes increasing the aggregate investment limit by Non-Resident Indians (“NRI”) or Overseas Citizens of India (“OCI”) in the share capital of the Company from 10% to 24% of the paid-up equity share capital, effective upon the listing of the equity shares of the Company.

6. Annexure A details several of the intended allottees in this preferential allotment, with amounts.

7. Annexure B contains the Memorandum of Association.

8. Annexure C contains the proposed new Articles of Association.

The notes section provides information regarding proxy appointments, document inspection, and attendance at the EGM. The explanatory statement provides context for each agenda item, disclosing the reasons for the resolutions, related party interests, and other relevant details. The document includes details regarding the existing authorized share capital, reasons for reclassification, and powers of the Board in giving effect to the resolutions, the offer including the date of passing of board resolution. It also states that the directors recommend the special resolution as set out in Agenda Item No. 1 of the notice in the best interest of the Company. M/s. V Mandhana & Associates will perform valuation: Address: 702(L), Hubtown Solaris, NS Phadke Marg, Andheri East, Mumbai - 400 069. Item No.: 03 is the ESOP scheme. Item No. 5 is on Approval of Initial Public Issue of Equity Shares. The objectives, issue price, intention of promoters, change in control and allotment are noted, with pre- and post-issue shareholding patterns. None of the Directors and key managerial personnel or their relatives are concerned or interested in the proposed resolution except to the extent of their shareholding in the Company. By order of the Board of Directors ESDS Software Solution Limited (Prasad Deokar) Company Secretary & Compliance Officer ICSI M. No. A34350 Registered Office: Plot No. B-24 & 25, NICE AREA, M.I.D.C. SATPUR. NASIK MH 422007 IN Place: Nasik Date: 03.01.2025 The above is a summarized record for members of company.

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