HERO CYCLES LIMITED CIN

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HERO CYCLES LIMITED

CIN - U35911PB1966PLC002667 Registered Office:Hero Nagar, GT Road, Ludhiana, Punjab –141003

Email:[email protected]

NOTICE OF TRIBUNAL CONVENED MEETING OF THE SECURED CREDITORS OF

HERO CYCLES LIMITED (Being convened pursuant to an order dated 06thJanuary 2022passed by the Hon’ble National

Company Law Tribunal, Chandigarh Bench) MEETING: Day : Sunday Date : 03rd April2022 Time : 10:00 A.M. (IST) Mode : As per the directions of the Hon’ble National Company Law Tribunal,

Chandigarh Bench, the meeting shall be conducted through Video Conferencing (“VC”) with the facility of remote e-voting

INDEX Sr. No. Particulars Page No.

1. Notice of the meeting of the secured creditors of Hero Cycles Limited convened by order of the Hon’ble National Company Law Tribunal, Chandigarh Bench(“NCLT” or “Tribunal”) dated 06th January 2022.

2-5

2. Explanatory Statement under Section 230 read with Section 102 of the Companies Act, 2013 6-22

3. ANNEXURE 1 Copy of Scheme of Arrangement

23-43

4. ANNEXURE 2 Copy of Share Exchange Ratio Report dated 26th August 2021issued by Mr. Niranjan Kumar, Registered Valuer (IBBI Registration No.-IBBI/RV/06/2018/10137)

44-75

5. ANNEXURE 3 Copy of Report adopted by the Board of Directors of Hero Motors Limited explaining the effect of the Scheme of Arrangement on shareholders, key managerial personnel, promoters and non-promoter shareholders, pursuant to the provisions of Section 232(2)(c) of the Companies Act, 2013

76-79

6. ANNEXURE 4 Copy of Report adopted by the Board of Directors of Hero Cycles Limited explaining the effect of the Scheme of Arrangement on shareholders, key managerial personnel, promoters and non-promoter shareholders, pursuant to the provisions of Section 232(2)(c) of the Companies Act, 2013

80-83

7. ANNEXURE 5 Audited Financial Statements of Hero Cycles Limited for the year ended 31st March 2021

84-136

8. ANNEXURE 6 Supplementary unaudited provisional Financial Statements of Hero Cycles Limited for the periodended30th September 2021

137

9. ANNEXURE 7 Audited Financial Statements of Hero Motors Limited for the year ended 31st March 2021

138-164

10. ANNEXURE 8 Supplementary unaudited provisional Financial Statements of Hero Motors Limited for the period ended 30th September 2021

165

11. ANNEXURE 9 Order of the Hon’ble National Company Law Tribunal, Chandigarh Bench dated 06th January 2022

166-179

12. Annexure A Instructions for remote e-voting, attending the meeting through Video Conferencing and voting during the meeting through e-voting system

180-181

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COMPANY APPLICATION NO. C.A. (CAA) No. 40/Chd/Pb/2021

In the matter of Sections 230-232 and other applicable provisions of the Companies Act, 2013

read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 And

In the matter of Scheme of Arrangement Between

HERO CYCLES LIMITED (Applicant Company 1 / Demerged Company)

WITH HERO MOTORS LIMITED

(Applicant Company 2 / Resulting Company) And

Their Respective Shareholders and Creditors

FORM NO. CAA 2 [Pursuant to Section 230 (3) and Rule 6 and 7 of Companies (Compromises, Arrangements

and Amalgamations) Rules, 2016]

NOTICE CONVENING THE MEETING OF THE SECURED CREDITORS OF HERO CYCLES LIMITED (APPLICANT COMPANY1 / DEMERGED COMPANY)

To, The Secured Creditors of Hero Cycles Limited (‘Applicant Company 1’ or ‘Demerged Company’)

Notice is hereby given that by an order dated06thJanuary 2022,the Chandigarh Bench of the Hon’ble National Company Law Tribunal (“Tribunal” or “NCLT”) has directed a meeting to be held of the secured creditors of the Applicant Company 1, for the purpose of considering, and if thought fit, approving with or without modification(s), the Scheme of Arrangement between Hero Cycles Limited (“HCL”/ ”Demerged Company” /“Applicant Company1”) and Hero Motors Limited(“HML” or the “Resulting Company” / “Applicant Company2”)(Applicant Company1 and Applicant Company2 hereinafter together referred to as ‘Applicant Companies’ or ‘Participating Companies’) and their respective shareholders & creditors (‘Scheme’). In pursuance of the said order and as directed therein, further notice is hereby given that a meeting of the secured creditors of the Applicant Company1will be held on Sunday, the 03rdDay of April 2022 at 10:00 A.M. (IST) (“Meeting”)through Video Conferencing(“VC”)with facility of remote e-voting and voting during the meeting through e-voting system as per the details provided herein in “Annexure A” to this Notice. Accordingly, you are requested to attend the Meeting via VC. Copies of the Scheme and of the Explanatory Statement, under Sections 230(3), 232(1) and 232(2) and 102 of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, along with the enclosures as indicated in the Index, can be obtained free of charge at the registered office of the Applicant Company1at Hero Nagar, GT Road, Ludhiana, Punjab – 141003 during business hours. Facility of remote e-voting will be available during the prescribed time period before the meeting and voting through e-voting system will be available during the meeting.

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Accordingly, secured creditors can vote through remote electronic means or e-voting system during the meeting.

The Tribunal has appointed Mr. Justice M.S. Sullar (Retd.), as the Chairperson, Mr. Karanveer Jindal, Advocate, as Alternate Chairperson and Ms. Swati Saluja, Advocate as the Scrutinizer for the meeting of secured creditors including for any adjournment or adjournments thereof. The Scheme, if approved in the aforesaid meeting, will be subject to the subsequent approval of the Tribunal. TAKE NOTICE that the following resolution is proposed under Sections 230 and other applicable provisions of the Act (including any statutory modification(s) or re-enactment thereof for the time being in force) and the provisions of the Memorandum of Association and Articles of Association of the Applicant Company1, for the purpose of considering, and if thought fit, approving, the Scheme of Arrangement amongst Hero Cycles Limited and Hero Motors Limited: “RESOLVED THAT pursuant to the provisions of Sections 230-232 and other applicable provisions of the Companies Act, 2013, the rules, circulars and notifications made thereunder (including any statutory modification or re-enactment thereof) as may be applicable, and subject to the provisions of the Memorandum and Articles of Association of the Company and subject to the approval of Hon’ble National Company Law Tribunal, Bench at Chandigarh (“Tribunal” or “NCLT”) and subject to such other approvals, permissions and sanctions of regulatory and other authorities, as may be necessary and subject to such conditions and modifications as may be prescribed or imposed by NCLT or by any regulatory or other authorities, while granting such consents, approvals and permissions, which may be agreed to by the Board of Directors of the Company (hereinafter referred to as the “Board”, which term shall be deemed to mean and include one or more Committee(s) constituted/to be constituted by the Board or any person(s) which the Board may nominate to exercise its powers including the powers conferred by this resolution), approval of the Secured Creditors of the Company, be and is hereby accorded to the Scheme of Arrangement amongst Hero Cycles Limited (“Demerged Company”) and Hero Motors Limited(“Resulting Company”) and their respective shareholders & creditors (‘Scheme’).” “RESOLVED FURTHER THAT the Board be and is hereby authorized to do all such acts, deeds, matters and things, as it may, in its absolute discretion deem requisite, desirable, appropriate or necessary to give effect to this resolution and effectively implement the Scheme and to accept such modifications, amendments, limitations and/or conditions, if any, (including withdrawal of the Scheme), which may be required and/or imposed by the NCLT while sanctioning the Scheme or by any authorities under law, or as may be required for the purpose of resolving any questions or doubts or difficulties that may arise in giving effect to the Scheme, as the Board may deem fit and proper.” A copy of the Explanatory Statement, under Sections 230(3), 232(1) and 232(2) and 102 of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, the Scheme and the other enclosures as indicated in the Index are enclosed.

Date : 28th February 2022

Place : Ghaziabad

Registered Office: Hero Nagar, GT Road, Ludhiana, Punjab – 141 003 CIN - U35911PB1966PLC002667

For Hero Cycles Limited

Sd/-

Sanjay Singh Suryavanshi

Authorised Signatory

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Notes: (1) In terms of the order dated 06thJanuary 2022 of the Tribunal, Chandigarh Bench, the Applicant

Company1 is convening the Meeting of secured creditors of Applicant Company1 through Video Conferencing in compliance of the Guidelines issued by the Ministry of Corporate Affairs and the relevant provisions of the Companies Act, 2013 and Rules made thereunder. Facility of remote e-voting will be available during the prescribed time period before the meeting and e-voting will also be available during the meeting. The proceedings of the meeting shall however be deemed to be conducted at the registered office of Company which shall be the deemed venue of the meeting.

(2) Only Secured Creditors of the Company may attend and vote at the meeting of the Secured

Creditors, to be held through VC and e-voting system.

(3) Wherein case Secured Creditor is a Corporate/ Body Corporate/ Institution, then pursuant to Section 113 of the Act, they are entitled to participate in the Meetings through their Authorised Representatives. Such Corporate Creditor is required to send either through email at [email protected] deposit at the Registered Office of the Company, a duly certified copy of the Board Resolution/ Power of Attorney authorizing such Authorized Representative and the Authorized Representative’s ID to attend and vote at the Meetings on its behalf, not later than 48 hours before the time fixed for the aforesaid Meetings.

(4) The remote e-voting for the secured creditors shall commence on 30thMarch 2022 (9:00 a.m. IST) and shall end on 02ndApril 2022 (5:00 p.m. IST).

(5) National Securities Depository Limited (“NSDL”) has been appointed to provide platform for

convening the meeting through video conferencing, remote e-voting and voting during the meeting in a secured and transparent manner. Detailed instructions and operational manual for participation and remote e-voting during the prescribed time period before the meeting and e-voting during the meeting is enclosed as Annexure A to the Notice. The secured creditors desiring to vote through remote e-voting, attend the meeting through VC and vote during the meeting, are requested to carefully follow the instructions set out in Annexure A to this Notice. The EVEN number for this meeting is 119412.

(6) Please take note that as per the directions of the Tribunal, the meeting is proposed to be

held through VC with facility of remote e-voting, accordingly, option of attending the meeting physically at venue or through proxy is not available.

(7) Secured creditors who have voted through remote e-voting during the available window as aforementioned in point (4) above will be eligible to attend/participate in the meeting through the NSDL platform. However, they will not be entitled to vote again during the meeting. Only those secured creditors who have not participated in remote e-voting system, may cast their e-vote during the meeting through NSDL platform.

(8) The quorum of the meeting of the secured creditors of the Applicant Company1 shall be 3(Three)in number or40% in value of the total secured creditors of the Applicant Company1 as on 30th June 2021. It is also directed that if the required Quorum is not present at the commencement of meeting, then the meeting will be adjourned for 30 minutes, and thereafter the persons present and voting shall be deemed to constitute the quorum.

(9) The documents referred to in the accompanying Explanatory Statement shall be open for inspection by the secured creditors at the registered office of the Applicant Company1 between 10.00 A.M. and 12.00 Noon on all days (except Saturdays, Sundays and public holidays) upto the date of the meeting. However, the same shall be open for inspection during the aforesaid meeting.

(10) The Notice, together with the documents accompanying the same, is being sent to all the

secured creditors of the Applicant Company1as on 30th June 2021either by registered post or speed post or through courier at their registered address or via e-mail. The notice, copies of

mailto:[email protected]

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Scheme of Arrangement, Explanatory Statement and annexures to the aforementioned documents may also be accessed on the website of the Applicant Company1 viz.www.herocycles.com. and on the website of NSDL viz. www.evoting.nsdl.com/.

(11) The notice convening the meeting will be published through advertisement in (i) Indian

Express (English, Chandigarh Edition), in the English language and (ii) translation thereof in Jagbani (Punjabi, Ludhiana Edition), in Punjabi language.

(12) In accordance with the provisions of Sections 230-232 of the Companies Act, 2013, the Scheme shall be acted upon only if a majority of persons representing three fourth in value of the secured creditors of the Applicant Company1, voting through remote e-voting or by e-voting system agree to the Scheme.

(13) The voting rights as well as the value of the secured creditors shall be in proportion to the outstanding amount due to them by the Applicant Company 1 as on cut-off date i.e., on 30th June 2021.

(14) As directed by the Tribunal, Ms. Swati Saluja, Advocate has been appointed as Scrutinizer for the said meeting of the secured creditors of the Applicant Company 1to scrutinize the voting during the meeting in a fair and transparent manner. Post the meeting, the Scrutinizer will submit the report to the Chairperson after completion of scrutiny of the Voting Process. As per Order of the Tribunal, the Chairperson shall report the result of the NCLT convened meeting to the Tribunal within 7days from the date of the conclusion of the meeting with regard to the proposed Scheme.

Encl.: As above

http://www.herocycles.com/

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COMPANY APPLICATION NO.C.A. (CAA) No. 40/Chd/Pb/2021

In the matter of Sections 230-232 read with Section 66 and other applicable provisions of the

Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016

And In the matter of Scheme of Arrangement

Between HERO CYCLES LIMITED

(Applicant Company 1 / Demerged Company) WITH

HERO MOTORS LIMITED (Applicant Company 2 / Resulting Company)

And

Their Respective Shareholders and Creditors

EXPLANATORY STATEMENT UNDER SECTIONS 230(3), 232(1), 232(2) AND 102 OF THE COMPANIES ACT, 2013 READWITH RULE 6 OF THE COMPANIES (COMPROMISES, ARRANGEMENTS AND AMALGAMATIONS) RULES, 2016 1. Pursuant to the order dated 06thJanuary 2022passed by the Hon’ble National Company Law

Tribunal, Chandigarh Bench (“NCLT”), in the Company Application Number C.A. (CAA) No. 40/Chd/Pb/2021(“Order”), a meeting of the secured creditors of Hero CyclesLimited (hereinafter referred to as the “Applicant Company 1” or the “Demerged Company” or “Company” as the context may admit) is being convened and held through Video Conferencing (“VC”) with facility of remote e-voting and voting during the meeting through e-voting system on Sunday, 03rdday of April 2022 at 10:00 A.M. (IST) (‘Meeting’), for the purpose of considering, and if thought fit, approving, with or without modification(s), the Scheme of Arrangement amongst Hero Cycles Limited and Hero Motors Limited and their respective shareholders and creditors under Sections 230 - 232 and other applicable provisions of the Companies Act, 2013 (the “Scheme”).

2. In terms of the said Order, the quorum for the said meeting shall be 3(Three) in number or 40%

in value of the total secured creditors of the Applicant Company1 as on 30th June 2021. It is also directed that if the required Quorum is not present at the commencement of meeting, then the meeting will be adjourned for 30 minutes, and thereafter the persons present and voting, shall be deemed to constitute the quorum.

3. In terms of the said Order, the Tribunal has appointed Mr. Justice M.S. Sullar (Retd.) as the Chairperson, Mr. Karanveer Jindal, Advocate, as Alternate Chairperson and Ms. Swati Saluja, Advocate, as the Scrutinizer for the meeting of secured creditors of Applicant Company 1 including for any adjournment or adjournments thereof.

4. This statement is being furnished as required under Sections 230(3), 232(1) and 232(2) and 102

of the Companies Act, 2013 (the “Act”) read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 (“Rules”).

5. In accordance with the provisions of Sections 230-232 of the Act, the Scheme shall be acted upon only if a majority in persons representing three fourths in value of the secured creditors, of the Applicant Company1, voting through remote e-voting or by e-voting system agree to the Scheme.

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Particulars of Hero Cycles Limited(‘HCL’ or ‘Applicant Company 1’): 6. Hero Cycles Limited (‘HCL’ or ‘Applicant Company 1’) is a public limited company

incorporated under the Companies Act, 1956 and has its registered office at Hero Nagar, GT Road, Ludhiana, Punjab – 141003. Its Corporate Identity Number (‘CIN’) is U35911PB1966PLC002667and Permanent Account Number (‘PAN’) is AAACH4073P. Applicant Company 1 was incorporated on 29th August1966.

7. The main objects of Applicant Company 1 are set out in its Memorandum of Association. The main objects of Applicant Company 1 are set out hereunder:

1) To acquire and take over as a going concern the business including manufacture now

carried on at Ludhiana under the name and style of M/s. Hero Cycle Industries and all the assets and liabilities of that firm.

2) (a) To carry on business of manufacturing cycles, bicycles, tricycles and carriages of all kinds and of all articles and things used for the manufacture, maintenance and working thereof : To buy, repair, alter and deal in apparatus, machinery materials and articles of all kinds which shall be capable of being used for the purpose of any business herein mentioned or likely to be required by customers of any such business (b) To manufacture, assemble, buy, sell distribute, import, export, alter remodel, hire, exchange, repair, service and otherwise deal in autocycle, mopeds, motorcycles and motor vehicles of every kind and description component parts thereof, spare parts, accessories, tools, implements, materials therefor and products for the transport or conveyance of passengers, merchandise and goods of every description, whether propelled by using gas, petroleum, diesel oil, steam, oil, vapour, electricity or any other motive or mechanical power. (c )To carry on the business of manufacturers of steel including stainless steel by any process in India and elsewhere and for that purpose to set up, purchase or otherwise acquire steel plants or Mini-Steel plants and all ancillary processing facilities for the production of ingots, bars, billets, rods, wire extrusion materials, twisted bars, squares, sheets, plates, strips, and steel of all shapes and sizes and steel goods of every size and description and without affecting the generality of the foregoing, railway axles and wheels, bridges, joints, channels, chimneys, rails, wire-ropes, cranes, tanks, presses, windows, pipes, furniture of steel or frames for the same and all other articles made of steel, penstock, gates, poles, fittings and fixtures, fasteners, agricultural implements, including tractors, trolleys and other equipments like boilers, steam engines, shunters, locomotives and for that purpose to set up in India and elsewhere and steel plants of every size and description

8. Applicant Company 1 is primarily engaged in the business of manufacturing of wide variety of

bicycles and allied components. In addition to this, the Applicant Company 1 has also forayed into manufacturing and production of auto components.

9. The authorized, issued, subscribed and paid-up share capital of Applicant Company 1 as on 30th September 2021 is as under:

PARTICULARS (AMOUNT IN INR)

AUTHORIZED SHARE CAPITAL

3,98,200 Equity Shares of ‘A-Class’ of INR 1,000 each 39,82,00,000

1,800 Equity Shares of ‘B-Class’ of INR 1,000 each 18,00,000

TOTAL 40,00,00,000

ISSUED, SUBSCRIBED AND PAID-UP SHARE CAPITAL

3,92,962 Equity Shares of ‘A-Class’ of INR 1,000 each 39,29,62,000

1,800 Equity Shares of ‘B-Class’ of INR 1,000 each 18,00,000

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TOTAL 39,47,62,000

Subsequent to 30thSeptember 2021, there has been no change in the authorised, issued, subscribed and paid-up share capital of Applicant Company 1 and it is the same as above.

10. The securities of Applicant Company 1are not listed on any stock exchange.

11. The details of the Promoters and Directors of Applicant Company 1 as on September 30, 2021,

along with their addresses as well as shareholding are as follows: Table A: Details of Promoters: Sr. No. Name Correspondence

Address No of shares Shareholding (%)

A Equity Share Class A

1. Pankaj Munjal B-5, Greater Kailash, Part – 1, South Delhi - 110 048

11,576 2.95%

2. Charu Munjal B-5, Greater Kailash, Part – 1, South Delhi - 110 048

1,161 0.30%

3. Aditya Munjal B-5, Greater Kailash, Part – 1, South Delhi - 110 048

871 0.22%

4. Abhishek Munjal B-5, Greater Kailash, Part – 1, South Delhi - 110 048

870 0.22%

5.

Pankaj Munjal on behalf of Om Prakash Pankaj Munjal - AOP

Hero Nagar, G.T. Road, Ludhiana - 141003 12,981 3.30%

6. Bhagyoday Investments P. Ltd.

Hero Nagar, G.T. Road, Ludhiana - 141003 28,846 7.34%

7.

Pankaj Munjal on behalf of OP Munjal Holding (Class A)

Hero Nagar, G.T. Road, Ludhiana - 141003 3,36,468 85.62%

8.

Pankaj Munjal on behalf of Munjal Sales Corp

Hero Nagar, G.T. Road, Ludhiana – 141003 184 0.05%

Total 3,92,957 99.99% B Equity Share Class B

1. Pankaj Munjal on behalf of OP Munjal Holding

Hero Nagar, G.T. Road, Ludhiana – 141003 1,800 100%

Total 1,800 100% Table B: Details of Directors:

Sr. No. Name Designation Address

No of shares (Class A-Equity)

Shareholding (%)

1. Mr. Shashi Kant Rai

Managing Director

H.No 256-H, Randhir Singh Nil

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Nagar, Ludhiana, Punjab. 141001

2. Mr. Yogesh Chander Munjal

Independent Director

H.no B-175, Greater Kailash-1, South Delhi. 110048

Nil

3. Mr. Pankaj Munjal

Whole-time Director

B-5, Greater Kailash, Part – 1, South Delhi - 110 048

11,576 2.95%

4. Mr. Tarun Vohra Independent Director

K-113, Hauz Khas Enclave, Hauz Khas, South Delhi – 110016

01 0.00%

5. Mr. Amit Gupta Whole-time Director

H.no 97, Girdhar Enclave, Main G.T road, Sahibabad, Ghaziabad, Uttar Pradesh. 201005

Nil

6. Mr. Aditya Munjal

Whole-time Director


871 0.22%

7. Mr. Abhishek Munjal

Whole-time Director

B-5, Greater Kailash,Part – 1, South Delhi - 110048

870 0.22%

8. Ms. Pratibha Goyal

Independent Women Director

H.No. 12, Pavate house, P.A.U, Ludhiana, Punjab. 141004

Nil

Total 13,318 3.39% Subsequent to 30th September 2021, there has been no change in the details of Promoters and Directors of Applicant Company 1 and it is the same as above except in case of Mr. Pankaj Munjal whose designation has changed from Whole-time Director to Non-Executive Chairman with effect from February 05, 2022. Particulars of Hero Motors Limited(‘HML or ‘Applicant Company 2’ or ‘Resulting Company’): 12. Hero Motors Limited (‘HML’ or ‘Applicant Company 2’or ‘Resulting Company’) is a public

limited company incorporated under the Companies Act, 1956 and has its registered office at Hero Nagar GT Road, Ludhiana, Punjab - 141003. Its Corporate Identity Number (‘CIN’) is U29299PB1998PLC039602 and Permanent Account Number (‘PAN’) isAAACH8459F. Applicant Company 2 was incorporated on 30th April 1998.

13. The main objects of Applicant Company 2are set out in its Memorandum of Association. The main objects of Applicant Company 2are set out hereunder: 1) To carry on the business of developing, manufacturing, marketing distribution, sale and

service engines upto 500cc and related transmission and power trains throughout the world, intended primarily for two-wheel and three wheel applications

2) To carry on the business of manufacturing, buying, selling, importing, exporting, improving, assembling, repairing and dealing in as original equipment manufacturing of all and every

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kind of machineries, components parts, replacement parts, spare accessories, tools, implements and fitting for engines upto 500cc capacity and to carry on any other business manufacturing or otherwise, which is connected to the above. (a) to conduct and carry on the business of manufacturing of all kinds of mopeds (Auto cycles), scooters, Motorcycles. Three Wheelers and other kinds of mopeds (Auto cycles), or otherwise and used in transport or carrying passengers and all accessories or parts required for same. (b) To manufacture engines and the other driving appliances to propel bicycles rickshaws and other kinds of passenger or goods transport vehicles. (c) To carry on the business of manufacturing all kinds of tubes, made of any metal or scasting and also deal in all kinds of tubes (d) To carry on the business of manufacture of all kinds of petrol, diesel, oil, kerosene and gas engines to give motive power for driving agricultural implements. Tractors, cars, lorries, yatchs, boats or other vehicles

3) To manufacture, deal buy and sell gears multispeed hubs, spokes and components thereof of all kinds and especially for use in bicycles, tricycles, auto cycle, motor-cycles, mopeds, cycles and auto cycles rickshaws.

4) To carry on the business of manufacturing, assemble, buy, sell, distribute, import, export of cycles, tricycles and carriages of all kinds and of all articles and things used for the manufacture, maintenance and working thereof to buy, repair, alter and deal in apparatus, machinery materials and articles of all kinds shall be capable of being used for the purpose of any business herein mentioned or likely to be required by customers of any such business.

14. The Applicant Company 2was incorporated with an objective to engage in the business of

manufacturing special purpose machinery and allied products.

15. The authorized, issued, subscribed and paid-up share capital of Applicant Company 2 as on 30thSeptember 2021is as under:

PARTICULARS AMOUNT IN INR

AUTHORIZED SHARE CAPITAL

6,20,00,000 Equity Shares of INR 10 each 62,00,00,000

9,95,00,000 6% Non-Cumulative Convertible Redeemable

Preference Shares of INR 10 each

99,50,00,000

TOTAL 161,50,00,000

ISSUED, SUBSCRIBED AND PAID-UP SHARE CAPITAL

3,45,97,133 Equity Shares of INR 10 each 34,59,71,330

TOTAL 34,59,71,330

Subsequent to 30thSeptember 2021, there has been no change in the authorised, issued, subscribed and paid-up share capital of Applicant Company 2 and it is the same as above.

16. The securities of Applicant Company 2 are not listed on any stock exchange.

17. The details of the Promoters and Directors of Applicant Company 2 as on September 30, 2021,

along with their addresses as well as shareholding are as follows: Table A: Details of Promoters: Sr. No. Name Address No of

shares Shareholding (%)

1. Hero Cycles Limited Hero Nagar, GT

Road, Ludhiana, 3,37,59,948 97.58%

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Punjab – 141 014



3,396 0.01%

3.

Smt. Sudershan Kumari Munjal


2,43,163 0.70%

4.

M/s Bhagyoday Investment Private Limited

Hero Nagar, GT Road, Ludhiana, Punjab – 141 014

5,63,479 1.63%

5.

Dayanand Munjal Investments Private Limited


5 0.00%

6.

Munjal Investments Private Limited


5 0.00%

7.

Munjal Sales Corporation (through Shri OP Munjal)


211 0.00%

8.

Thakuri Devi Investment Private Limited


5 0.00%

Total 3,45,70,212 99.92% Table B: Details of Directors Sr. No.

Name Designation Address No of

shares Shareholding

(%)


Managing Director

B-5, Greater Kailash part – 1, New Delhi-110048

3,396 0.01%

2. Mrs. Charu Munjal

Non-Executive Director


- -

3. Mr. Pawan Puri

Non-Executive, Independent Director

183, Sidhartha Enclave, Ring Road, New Delhi – 110 014

- -

4. Mr. Abhishek Munjal

Non-Executive Director


- -

5. Mrs. Pratibha Goyal

Non-Executive, Independent Director

H.No 12, Pavate House, P.A.U, Ludhiana, Punjab. 141004

- -

Total 3,396 0.01% Subsequent to 30th September 2021, there has been no change in the details of Promoters and Directors of Applicant Company 2 and it is the same as above.

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18. Board Meeting approving the Scheme of Arrangement The Board of Directors of both the Applicant Companies have unanimously approved the proposed Scheme of Arrangement vide their respective Board Resolutions dated 27th August 2021 in case of Applicant Company 1 and 06th September 2021 in case of Applicant Company 2,after taking on record the Fair Valuation report dated 26thAugust 2021, issued by registered valuer, Mr. Niranjan Kumar(IBBI Registration No.-IBBI/RV/06/2018/10137).

Names of the directors who voted in favour of the resolution, who voted against the resolution and who did not vote or participate on such resolutions are as follows:

A. Hero Cycles Limited: Sr. No. Name of the Director Voted in Favour/

Against/ Abstained from voting

1. Mr. Shashi Kant Rai Favour 2. Mr. Yogesh Chander Munjal Favour

3. Mr. Pankaj Munjal Favour

4. Mr. Tarun Vohra Favour

5. Mr. Amit Gupta Favour

6. Mr. Aditya Munjal Favour

7. Mr. Abhishek Munjal Favour

8. Ms. Pratibha Goyal Favour

B. Hero Motors Limited: Sr. No. Name of the Director Voted in Favour/

Against/ Abstained from voting

1. Mr. Pankaj Munjal Favour

2. Ms. Charu Munjal Favour

4. Mr. Pawan Puri Favour

5. Mr. Abhishek Munjal Favour

6. Ms. Pratibha Goyal Favour

19. Brief details of the Scheme

S.No. Particulars Particulars

i. Parties involved in the Scheme

- Hero Cycles Limited (“HCL”/ “Applicant Company 1”/ “Demerged Company”)

- Hero Motors Limited (“HML”/ “Applicant Company 2”/Resulting Company”)

Hereinafter, collectively referred to as ‘Participating Companies or ‘Applicant Companies’.

ii. Relationship between the Companies

- HCL holds97.58% equity stake in HML.

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iii. Scheme of Arrangement

The Scheme provides for (i)The acquisition of shares of the Resulting Company, as held by public shareholders of the Resulting Company, by the Demerged Company, as the majority shareholder of the Resulting Company (Part B of the Scheme);(ii)demerger of Auto Business Undertaking of the Demerged Company into the Resulting Company; and their respective shareholders and creditors, pursuant to the provisions of Sections 230 – 232 and other applicable provisions of the Act, and rules made thereunder with such modifications and amendments as may be made from time to time, with the appropriate approvals and sanctions of the Tribunal and other relevant regulatory authorities, as may be required under the Act and under all other applicable laws (Part C of the Scheme).

iv. Appointed Date For the purpose of Part B of the Scheme shall mean the Effective Date; and for Part C of this Scheme, opening business hours on 01st April 2021or such other date as may be decided or approved by the NCLT.

v. Effective Date Effective Date means the date or last of the dates on which certified copies of the order of the NCLT sanctioning the Scheme are filed by the Participating Companies with the registrar of companies. Any references in this Scheme to “upon this Scheme becoming effective” or “effectiveness of this Scheme” shall refer to the Effective Date

vi. Summary of Fair Valuation Report capturing the fair valuation of Equity Shares of Hero Motors Limited / Resulting Company for the purpose of Part B of the Scheme and Share Entitlement Ratio for Part C of the Scheme, dated 26thAugust 2021 obtained from registered Valuer, Mr. Niranjan Kumar

1. Under Part-B of the Scheme: Acquisition of shares of Hero Motors Limited by Hero Cycles Limited from the public shareholders of Hero Motors Limited “Fair value per equity share of HML to be INR 23.60 each” However, on the base of Fair Valuation Report, the Board of Directors decided upon the following: “with the intent to provide a reasonable price to the public shareholders of the Resulting Company, the Demerged Company has suo-muto proposed a premium of 25% of the value of Resulting Company equity shares, as determined in the aforementioned valuation report and further rounded-off to next 0.50 paise (Fifty paise only) to avoid any fractions. In line with this approach, the Offer Price of INR 29.50/- per share has been computed.”

2. Under Part-C of the Scheme: Demerger of Auto Business Undertaking of the Demerged Company into the Resulting Company “81,174 (Eighty-One Thousand One Hundred and Seventy-Four) equity shares of HML having face value of INR 10/- each fully paid up shall be issued for every 100 (Hundred) A-Class equity shares held in HCL having face value of INR 1,000 each fully paid up.”. “1 (one) equity share of HML of INR 10 each fully paid up against all outstanding B-Class equity shares of HCL.”.

The Share Entitlement Ratio Report is available for inspection at the registered office of Applicant Company 1.

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vii. Rationale of the Scheme or the benefits of the Scheme as perceived by the Board of Directors of the Company to the Company, Shareholders, Creditors and Others

The Resulting Company has been receiving representations from some of the 0.08% public shareholders seeking an exit opportunity from the Resulting Company in order to unlock the value of their investment and for other allied reasons.

The public shareholders of the Resulting Company have limited avenues available to monetize their holding in the Resulting Company and unlock the value of their investment.

All the key business and commercial decisions of the Resulting Company are undertaken by its board of directors and to the extent required under applicable laws, are ratified by the shareholders of the Resulting Company i.e., the Demerged Company and the public shareholders (to the extent of their participation). Given that the Demerged Company is the single largest shareholder of the Resulting Company, all matters requiring shareholders consent are automatically ratified, upon receipt of the standalone approval of the Demerged Company.

Furthermore, managing such a vast majority ofpublic shareholders for a company, which effectively functions as a closely held company, leads to incremental cost and compliance requirements.

In light of the above, Demerged Company, therefore, intends to acquire the stake held by public shareholders in the Resulting Company

Presently, the Demerged Company operates primarily in the Cycle Business in India and in overseas jurisdictions (including via direct exports and through investment in overseas companies) and limited segregated resources are allocated towards the Auto Business thus qualifying as the non-core business of the Demerged Company. Management believes that the nature of offerings and the risk and return profile of the Cycle Business of the Demerged Company, being its mainstay, wherein it operates as one of the prominent market / segment player, is different vis-à-vis the Auto Business. The Auto Business has a separate business portfolio and service offerings and functions independently. Considering the above, the management intends to segregate the Auto Business operations, so as to scale the operations, achieve economies of scale, unlock the growth potential and to serve the Auto Business consumers in a more comprehensive manner. In order to achieve the same, it is being envisaged that the Auto Business of the Demerged Company should be demerged into and consolidated with Resulting Company. It is expected that such restructuring will be beneficial for the Demerged Company, the Resulting Company and their respective shareholders and creditors, as it would result in concentrated focus on the Cycle Business by the Demerged Company and on the Auto Business by the Resulting Company, thus unlocking of value

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of the independent businesses for the stakeholder.

The Resulting Company and the Demerged Company therefore propose to re-organize their business and holding structure, by way of acquisition of minority interest in the Resulting Company, as held by its public shareholders by the Demerged Company and demerger of the Auto Business (‘Auto Business Undertaking’) of the Demerged Company into the Resulting Company

20. Key salient features of the Scheme

1. Definitions:

In this Scheme, unless repugnant to the subject context or meaning thereof, the following capitalised words and expressions shall have the meaning as se out herein below:

1.8. “Demerged Company” means Hero Cycles Limited, a public limited company,

incorporated under the Indian Companies Act, 1956 and having its registered office at Hero Nagar G.T. Road, Ludhiana, Punjab - 141 003, India. Its Corporate Identity Number is U35911PB1966PLC002667, and Permanent Account Number is AAACH4073P;

1.9. “Demerged Undertaking” or “Demerged Business” means Auto Business Undertaking of Hero Cycles Limited;

1.11. “Effective Date” for the purpose of this Scheme shall mean the date or last of the dates on which certified copy of the order of the NCLT sanctioning the Scheme are filled by the Demerged Company and the Resulting Company with the registrar of companies. References in this scheme to the date of “coming into effect of this scheme” or “upon the scheme becoming effective” shall mean the effective date

1.10. “Auto Business Undertaking” means and includes the undertaking of the Demerged Company related to Auto Business consisting, inter-alia, all assets including movable and immoveable properties and all liabilities relating thereto. Assets and Liabilities of the Auto Business Undertaking shall, inter-alia, mean and include:

(i) The assets (whether real or personal, corporeal or incorporeal, present, future, contingent, tangible or intangible) pertaining to the Auto Business Undertaking of the Demerged Company including but not limited to equipment’s, licenses, furniture, fixtures, lab equipment, appliances, accessories, vehicles, deposits, all stocks, assets, working capital, all customer/vendor contracts, trademarks, logo, copyright, patent, brand name, contingent rights or benefits belonging to or in the ownership, power, possession or the control of or vested in or granted in favour of or held for the benefit of or enjoyed by the Auto Business Undertaking;

(ii) All deposits, advances, loans, receivables, funds, staff advances, advance payments to regulatory authorities, cash, bank balances, accounts and all earnest money and / or deposits including security deposits made / paid by the Demerged Company in connection with or relating to the Auto Business Undertaking;

(iii) The liabilities pertaining to / arising out of the activities or operations of the Auto Business Undertaking, inter-alia, including the following:

• All liabilities which arise out of the activities or operations of the Auto Business Undertaking.

• Specific loans and borrowings raised, term loans from banks and financial institutions (if any), bank overdrafts, working capital loans & liabilities, incurred and utilized solely for the activities or operations of the Auto Business Undertaking

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• Liabilities other than those referred to above, being the amounts of general or multipurpose borrowings of the Demerged Company, if any, allocated to the Auto Business Undertaking in the same proportion in which the value of the assets (ignoring the revalued amount) transferred under this Scheme bear to the total value of the assets of the Demerged Company immediately before giving effect to this Scheme;

Provided however that any question that may arise as to whether a specified asset or liability pertains or does not pertain to the Auto Business Undertaking or whether it arises out of the activities or operations of the Auto Business Undertaking shall be decided by mutual agreement between the Board of Directors of the Demerged Company and the Resulting Company;

(iv) All permanent and temporary employees of the Demerged Company employed in / or relatable to the Auto Business Undertaking as on the Effective Date, and as identified by the Board of Directors of the Demerged Company;

(v) All books, records, files, papers, computer software along with their licenses, manuals and backup copies, drawings, data catalogues, and other data and records, whether in physical or electronic form, directly or indirectly in connection with or relating to the Demerged Undertaking;

Without prejudice to the generality of the foregoing, it is clarified that all rights, entitlements, consents, permissions, licenses, certificates, authorizations relating to the Auto Business Undertaking shall stand transferred to the Resulting Company as if the same were originally given by, issued to or executed in favour of the Resulting Company, and the rights and benefits under the same shall be available to the Resulting Company. Further, all benefits or incentives including income tax, sales tax (including deferment of sales tax), goods and service tax, value added tax and any other direct or indirect tax(es) benefits in respect of the Auto Business Undertaking for which the Demerged Company is entitled to in terms of the various statutes and / or schemes of Union and State Governments, shall be available to and vest in the Resulting Company

1.3. “Appointed Date” for the purpose of Part B of the Scheme shall mean the Effective Date and for the purpose of Part C of the Scheme shall mean 01st April 2021 or such other date as the NCLT may direct for the purposes of this Scheme;

4. Background and Rationale for the Scheme of Arrangement:

The Resulting Company has been receiving representations from some of the 0.08% public shareholders seeking an exit opportunity from the Resulting Company in order to unlock the value of their investment and for other allied reasons. Such requests have been considered in light of the following facts:

a. The public shareholders of the Resulting Company have limited avenues available to monetize their holding in the Resulting Company and unlock the value of their investment.

b. All the key business and commercial decisions of the Resulting Company are undertaken by its board of directors and to the extent required under applicable laws, are ratified by the shareholders of the Resulting Company i.e., the Demerged Company and the public shareholders (to the extent of their participation). Given that the Demerged Company is the single largest shareholder of the Resulting Company, all matters requiring shareholders consent are automatically ratified, upon receipt of the standalone approval of the Demerged Company.

c. Furthermore, managing such a vast majority of public shareholders for a company, which effectively functions as a private company, leads to incremental cost and compliance requirements.

In light of the above, Demerged Company, therefore, intends to acquire the stake held by public shareholders in the Resulting Company.

5. Presently, the Demerged Company operates primarily in the Cycle Business in India and

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in overseas jurisdictions (including via direct exports and through investment in overseas companies) and limited segregated resources are allocated towards the Auto Business thus qualifying as the non-core business of the Demerged Company. Management believes that the nature of offerings and the risk and return profile of the Cycle Business of the Demerged Company, being its mainstay, wherein it operates as one of the prominent market / segment player, is different vis-à-vis the Auto Business. The Auto Business has a separate business portfolio and service offerings and functions independently. Considering the above, the management intends to segregate the Auto Business operations, so as to scale the operations, achieve economies of scale, unlock the growth potential and to serve the Auto Business consumers in a more comprehensive manner. In order to achieve the same, it is being envisaged that the Auto Business of the Demerged Company should be demerged into and consolidated with Resulting Company. It is expected that such restructuring will be beneficial for the Demerged Company, the Resulting Company and their respective shareholders and creditors, as it would result in concentrated focus on the Cycle Business by the Demerged Company and on the Auto Business by the Resulting Company, thus unlocking of value of the independent businesses for the stakeholder.

6. CONSIDERATION

6.1. The Resulting Company shall without any further act, issue and allot its equity shares of face value of INR 10 each as consideration to each equity shareholder (‘A-Class’ and ‘B-Class’) of the Demerged Company, whose name is recorded in the register of members of the Demerged Company as on Record date or to their respective heirs, executors, administrators or other legal representatives or successors-in-title, as the case may be, in the following manner:

“81,174 (Eighty-One Thousand One Hundred and Seventy-Four) equity shares of HML having face value of INR 10/- each fully paid up shall be issued for every 100 (Hundred) A-Class equity shares held in HCL having face value of INR 1,000 each fully paid up.”

“1 (one) equity share of HML of INR 10 each fully paid up against all outstanding B-Class equity shares of HCL.”

6.2. The aforesaid ratio for the issue of equity shares by the Resulting Company against the equity shares(‘A-Class’ and ‘B-Class’) held by the shareholders in the Demerged Company is based on the recommendations made in the Share Entitlement Report issued by the registered valuer Mr. Niranjan Kumar, Registered Valuer – Securities or Financial Assets.

6.3. Equity shares to be issued and allotted in terms hereof will be subject to the Memorandum of Association and Articles of Association of the Resulting Company and shall be deemed to be in compliance with the provisions of the Act or any law for the time being in force.

6.4. The approval of this Scheme by the requisite majority of shareholders of the Resulting Company shall be deemed to be in due compliance of the provisions of Section 62 of the Act, and other relevant and applicable provisions of the Act for the issue and allotment of shares by the Resulting Company to the shareholders of the Demerged Company, as provided in this Scheme. No fractional shares shall be issued by the Resulting Company to the shareholders of the Demerged Company in respect of the residual fractional entitlements (if any), to which the shareholders of the Demerged Company may be entitled on issue and allotment of the shares of the Resulting Company in pursuance of this Clause 6.1. Any fraction arising out of such allotment shall be rounded off to the closest integer (i.e., if fraction equals to or exceed 0.5, round-off will be to higher integer and vice versa).

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7. Accounting Treatment

7.1. In the books of the Demerged Company

Upon this Scheme becoming effective, the Demerged Company and the Resulting Company shall account for the demerger of the Auto Business Undertaking in their respective books of accounts with effect from the Appointed Date, in the following manner:

7.1.1. The Demerged Company and the Resulting Company shall account for the demerger of the Auto Business Undertaking in terms of Appendix C of Indian Accounting Standard (IND AS) 103 Business Combinations as notified under Section 133 of the Act, read together with Paragraph 3 of The Companies (Indian Accounting Standard) Rules, 2015

7.2. The Demerged Company and the Resulting Company, by its Board of Directors, may alter or modify the accounting treatment specified in this Scheme, in consultation with its auditors, as it may deem fit and consider necessary, to settle any question / difficulty out of the Scheme, to comply with the Applicable Laws (including but not limited to the Income-tax Act, 1961 as amended from time to time) and applicable accounting standards.

You are requested to read the entire text of the Scheme to get fully acquainted with the provisions thereof. The aforesaid are only some of the key provisions of the Scheme.

21. The accounting treatment as proposed in the Scheme is in conformity with the accounting

standards prescribed under Section 133 of the Act read with relevant rules issued thereunder. The certificates issued by the respective Statutory Auditors of the Applicant Companies are open for inspection at the registered office of Applicant Company 1.

22. Details of the Directors and Key Managerial Personnel (KMP) and their respective relatives and their respective equity shareholding in each entity as on 30th September 2021 are as follows : None of the Directors, Key Managerial Personnel and/ or their relatives are, in any way, concerned or interested, financially or otherwise, in the abovementioned resolution except to the extent of shareholding of the Directors given below: A. Hero Cycles Limited(‘HCL’):

S.No. Name of Directors Shares (%) held in

HCL HML 1. Mr. Pankaj Munjal 2.95% 0.01% 2. Mr. Aditya Munjal 0.22% - 3. Mr. Abhishek Munjal 0.22% -

B. Hero Motors Limited(‘HML’):

S.No. Name of Directors Shares (%) held in

HCL HML 1. Mr. Pankaj Munjal 2.95% 0.01% 2. Ms. Charu Munjal 0.30% - 3. Mr. Abhishek Munjal 0.22% -

23. Statement disclosing details of Arrangement as per sub-section 3 of Section 230 of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016:

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S.No. Particulars HCL HML i. Details of capital or debt

restructuring, if any Not applicable

ii. Benefits of the

arrangement as perceived by the Board of directors to the company, members, creditors and others (as applicable)

Refer Para 19 (vii)of the Explanatory Statement.

iii. Amounts due to unsecured and secured creditors as on 30th June 2021

Secured Creditors: 5,32,33,00,000/ Unsecured Creditors: 3,87,98,73,134

Secured Creditors: Nil Unsecured Creditors: 16,205,042

iv. If the Scheme of Arrangement relates to more than one company, the fact and details of any relationship subsisting between such companies who are parties to such scheme of compromise or arrangement, including holding, subsidiary or associate companies

- The Demerged Company holds 97.58% of the share capital of the Resulting Company

v. Disclosure about effect of the compromise or arrangement on: a. Key Managerial

Personnel There is no impact of the Scheme on any of the KMPs of the Applicant Companies. Further, none of the KMPs have any interest in the Scheme except to the extent of shares held by them, if any, in the respective Applicant Companies.

b. Directors The proposed Scheme of Arrangement would not affect any Director of the Applicant Companies.

c. Promoters / Non-Promoters members

There is no impact of the Scheme on any of the Shareholders of the Applicant Companies. Further, none of the Shareholders have any interest in the Scheme except to the extent of shares held by them in the respective Applicant Companies. The Promoter and Non-Promoter Members of the Applicant Company 1 shall be issued shares of Applicant Company 2 as per terms and conditions, detailed in the Scheme of Arrangement

d. Creditors All the liabilities and dues payable relating to the Auto Business Undertaking of the Applicant Company 1/Demerged Company(Post giving effect to Part-C of the Scheme) shall become the liabilities and dues payable of the Applicant Company 2/Resulting Company.

e. Depositors As on date, the Demerged Company and the Resulting Company have no outstanding public deposits and therefore, the effect of the Scheme on any such public deposit holders or deposit trustee(s) does not arise

f. Debenture Holders In terms of the proposed Scheme of Arrangement and as part of the Auto Business Undertaking of the Demerged Company being demerged with and into the Resulting Company, identified non-convertible debentures of the Demerged Company shall stand transferred into the Resulting Company. Details of the said non-convertible debentures of the Demerged Company are as follows :

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− Axis 7.95% NCDs : means 600 (Six Hundred Only) Redeemable Non-convertible Debentures, having face value of INR 10,00,000 (Ten Lacs Only) each, aggregating to INR 60,00,00,000 (Sixty Crores Only), issued through AXIS Trusteeship Services Ltd.

− Beacon 7.50% NCDs : means 500 (Five Hundred Only) Redeemable Non-convertible Debentures, having face value of INR 10,00,000 (Ten Lacs Only) each, aggregating to INR 50,00,00,000 (Fifty Crores Only), issued through Beacon Trusteeship Ltd.

Further, the proposed Scheme provides that upon the Scheme becoming operative, the obligation towards Axis 7.95% NCDs and Beacon 7.50% NCDs [collectively referred to as ‘Auto Business NCDs’] shall be duly transferred to and assumed by the Resulting Company, whereby such Auto Business NCDs shall, pursuant to the provisions of Sections 230 to 232 and other relevant provisions of the Act, without any further instrument or deed, become the debt securities of Resulting Company, held by such holders of the Auto Business NCDs, as appearing in the records of the Demerged Company on the Record Date. For the purpose of transfer of the Auto Business NCDs, such Auto Business NCDs existing in the books of the Demerged Company shall stand automatically cancelled without any act or deed of the Demerged Company and the Resulting Company or any other person, with the Demerged Company being simultaneously released from, and having no liability in relation to such Auto Business NCDs and further, the Resulting Company shall undertake issuance of new redeemable non-convertible debentures, which are on the same terms and conditions and rank pari-passu with the existing Auto Business NCDs as on the Record Date. In line with the above treatment as provided for the Auto Business NCDs, the Scheme would not have any impact on the debenture holders (including their rights associated with such auto Business NCDs) Furthermore, as on date, no debentures have been issued and allotted by the Resulting Company and consequently, the effect of the Scheme on any such debenture holders and or debenture trustees does not arise.

g. Deposit trustee and debenture trustee

As on date, the Demerged Company and the Resulting Company have no outstanding public deposits and therefore, the effect of the Scheme on any such public deposit holders or deposit trustee(s) does not arise. In case of the Demerged Company, the Debenture Trustee(s) appointed for the identified non-convertible debentures viz. AXIS Trusteeship Services Ltd and Beacon Trusteeship Ltd. shall continue to remain the Debenture Trustee(s). Further, none of the respective Debenture Trustee(s) of the Demerged Company have any material interest in the Scheme. Furthermore, as on date, no debentures have been issued and allotted by the Resulting Company and consequently, the effect of the Scheme on any such debenture holders and or debenture trustees does not arise.

h. Employees of the Company

All the staff, workmen and other employees pertaining to Auto Business Undertaking of the Applicant Company 1 immediately before the transfer of said Undertaking under the Scheme of

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Arrangement (post giving effect to Part-B, Part-C of the Scheme) shall become the staff, workmen and employees of the Applicant Company 2 as per the details mentioned in the Scheme of Arrangement.

vi. Disclosure about effect of compromise or arrangement on material interest of Directors, Key Managerial Personnel and debenture trustee

a. Directors The proposed Scheme of Arrangement would not affect any Director of the Applicant Companies.

b. Key Managerial Personnel

No material effect of arrangement.

c. Debenture Trustee In case of the Demerged Company, the Debenture Trustee(s) appointed for the identified non-convertible debentures viz. AXIS Trusteeship Services Ltd and Beacon Trusteeship Ltd. shall continue to remain the Debenture Trustee(s). Further, none of the respective Debenture Trustee(s) of the Demerged Company have any material interest in the Scheme. Furthermore, as on date, no debentures have been issued and allotted by the Resulting Company and consequently, the effect of the Scheme on any such debenture holders and or debenture trustees does not arise.

vii. Details of approvals, sanctions or no-objection(s), if any, from regulatory or any other governmental authorities required, received or pending for the proposed scheme of compromise or arrangement

The Scheme is subject to approval from jurisdictional NCLT. Further, notice under Section 230(5) of Companies Act, 2013 is being submitted with the Central Government, Registrar of Companies, Income Tax Authorities, and Official Liquidator in respect of all the Applicant Companies.

viii. A statement to the effect that the persons to whom the notice is sent may vote in the meeting either in person or by proxies, or where applicable, by voting through electronic means.

Secured Creditors of Applicant Company 1 to whom the Notice is sent may either vote using remote e-voting system or vote during the meeting via VC through e-voting system. Unsecured Creditors of Applicant Company 1 and Applicant Company 2 to whom the Notice is sent may either vote using remote e-voting system or vote during the meeting via VC through e-voting system.

General:

24. The copy of draft scheme has been filed with the Registrar of Companies.

25. The National Company Law Tribunal at Chandigarh by its Order dated 06thJanuary 2022 has

dispensed with the requirement of convening the meeting(s) of the Equity Shareholders Applicant Company 1 and Applicant Company 2.

26. The National Company Law Tribunal at Chandigarh by its Order dated06th January 2022 has directed for convening of the meeting(s) of the Secured Creditors of Applicant Company 1 and Unsecured Creditors of Applicant Company 1 and Applicant Company 2via Video Conferencing with facility of remote e-voting and publication of notice of the said meeting(s) in newspaper.

27. No investigation or proceedings have been instituted or are pending under applicable provisions of Companies Act, 2013 or erstwhile provisions of Companies Act, 1956 against any of the Applicant Companies.

28. No winding up petition has been admitted against any of the Applicant Companies.

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29. Copy of the notice(s) issued to the Secured Creditors of Applicant Company 1, the Scheme of Arrangement and Explanatory Statement under Section 230 of the Companies Act, 2013 have been placed on the website of the Applicant Company-1 at www.herocycles.com

30. The detailed procedure for participation in the meeting through VC, remote e-voting and voting during the meeting through e-voting system is enclosed with this notice as Annexure A. The Secured Creditors desiring to attend and vote at the meeting convened either through video conferencing or remote e-voting, are requested to carefully follow the instructions set out in Annexure A to this Notice.

31. The following documents will be open for obtaining extracts from or for making or obtaining copies or inspection by the Secured creditors of the Applicant Company 1at Hero Cycles Limited, GT Road, Ludhiana, Punjab – 141003between 10:00 AM to 12:00 Noon on all working days, except Saturdays, Sundays and Public Holidays upto the date of the meeting: a) Copy of the Order dated06thJanuary2022of the NCLT passed in Company Application

No.C.A. (CAA) No. 40/Chd/Pb/2021directing the convening of meeting(s) of the Secured Creditors of Applicant Company 1 via Video Conferencing with facility of remote e-voting;

b) Copy of the Company Application No. C.A. (CAA) No.40/Chd/Pb/2021; c) Copy of Scheme of Arrangement; d) Memorandum and Articles of Association of all Applicant Companies; e) Audited Accounting Statement of Applicant Company 1 and Applicant Company 2for the

period ended 31st March 2021; f) Supplementary unaudited Accounting Statement of Applicant Company 1 and Applicant

Company 2for the period ended 30thSeptember 2021; g) Copies of the Fair Value Report / Share Entitlement Ratio Report dated 26th August2021

issued byMr. Niranjan Kumar (Registered Valuer) (IBBI Registration No.-IBBI/RV/06/2018/10137);

h) Certificates issued by Statutory Auditors of all the Applicant Companies in relation to the accounting treatment prescribed in the Scheme is in conformity with the Accounting Standards prescribed under Section 133 of Companies Act, 2013read with relevant rules issued thereunder;

i) List of secured creditors of the Applicant Company 1 as on 30thJune 2021; j) Any other information, contracts or agreements material to the arrangement.

32. A copy of the Scheme and Explanatory Statement shall be furnished to the secured creditors, free of charge, within 1 (one) day (except Saturdays, Sundays and public holidays) on a requisition being so made for the same by the secured creditors.

Date : 28th February 2022

Place : Ghaziabad

Registered Office: Hero Nagar, GT Road, Ludhiana, Punjab – 141 003 CIN - U35911PB1966PLC002667

For Hero Cycles Limited

Sd/-

Sanjay Singh Suryavanshi

Authorised Signatory

http://www.herocycles.com/

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Page 1 of 14

CA (CAA) No.40/Chd/Pb/2021(1st Motion)

THE NATIONAL COMPANY LAW TRIBUNALCHANDIGARH BENCH, CHANDIGARH

(through web-based video conferencing platform)


Under Sections 230 to 232 ofthe Companies Act, 2013

IN THE MATTER OF SCHEME OF ARRANGEMENT OF:

Hero Cycles Limitedwith its registered office atHero Nagar, G.T. Road, Ludhiana,Punjab - 141003CIN: U35911PB1966PLC002667

…Applicant Company No.1/ Demerged CompanyAnd

Hero Motors Limitedwith its registered office atHero Nagar, G.T. Road, Ludhiana,Punjab - 141003CIN: U29299PB1998PLC039602

…Applicant Company No.2/ Resulting Company

Order delivered on: 06.01.2022

Coram: HON’BLE MR. HARNAM SINGH THAKUR, MEMBER (JUDICIAL)HON’BLE MR. SUBRATA KUMAR DASH, MEMBER (TECHNICAL)

Present through Video Conferencing : -

For the Applicant Companies: Mr. Vaibhav Sharma, Advocate

Per: Subrata Kumar Dash, Member (Technical)

ORDER

This is a joint First Motion Application filed by Applicant Companies

namely; Hero Cycles Limited (for short hereinafter referred to as Applicant

Company No.1/Demerged Company) and Hero Motors Limited (for short

hereinafter referred to as Applicant Company No.2/Resulting Company) under

Section 230-232 of Companies Act, 2013 (the Act) and other applicable

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Page 2 of 14


provisions of the Act read with Companies (Compromises, Arrangements and

Amalgamations) Rules, 2016 (the Rules) in relation to the Scheme of

Arrangement between the Applicant Companies. The said Scheme is attached

as Annexure-1 to the Application.

2. The Applicant Companies have prayed for dispensing with the

requirement for convening the meetings of the A-Class Equity Shareholders and

B-Class Equity Shareholders of Applicant Company No.1/Demerged Company

and Equity Shareholders of Applicant Company No.2/Resulting Company. It is

further prayed for convening of the meetings of Secured and Unsecured

Creditors of the Applicant Company No.1 and meetings of Unsecured Creditors

of the Applicant Company No.2.

3. The Applicant Company No.1/Demerged Company is presently engaged

in the business of manufacturing cycles, bicycles, tricycles and carriages of all

kinds and of all articles and things used for the manufacture, maintenance and

working thereof. The Applicant Company No.2/Resulting Company is presently

engaged in the business of developing, manufacturing, marketing distribution,

sale and service engines upto 500cc and related transmission and power trains

throughout the world, intended primarily for two-wheel and three wheel

applications.

4. It is submitted that the registered offices of the Applicant Companies are

at Ludhiana, which is situated in the State of Punjab and, therefore, the both

applicant companies are under the territorial jurisdiction of this Bench.

5. The background of companies and rationale of the Scheme is given

below:-

“Presently, the Demerged Company operates primarily in the Cycle

Business in India and in overseas jurisdictions (including via direct

exports and through investment in overseas companies) and

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limited segregated resources are allocated towards the Auto

Business thus qualifying as the non-core business of the Demerged

Company. Management believes that the nature of offerings and

the risk and return profile of the Cycle Business of the Demerged

Company, being its mainstay, wherein it operates as one of the

prominent market / segment player, is different vis-à-vis the Auto

Business. It is being envisaged that the Auto Business of the

Demerged Company should be demerged into and consolidated

with Resulting Company. It is expected that such restructuring will

be beneficial for the Demerged Company, the Resulting Company

and their respective shareholders and creditors, as it would result in

concentrated focus on the Cycle Business by the Demerged

Company and on the Auto Business by the Resulting Company,

thus unlocking of value of the independent businesses for the

stakeholder.”

6. It is stated that the Board of Directors of the Demerged

Company/Applicant Company No.1 and Resulting Company/Applicant Company

No.2 in their meetings held on 27.08.2021 and 06.09.2021 respectively have

considered and unanimously approved the Scheme of Arrangement subject to

sanctioning of the same by this Tribunal. The copy of the Board Resolutions of

the Demerged Company/Applicant Company No.1 and Resulting

Company/Applicant Company No.2 are attached as Annexure-4 and Annexure-

10, respectively of the application. The Applicant Company No.1 and Applicant

Company No.2 have authorized Mr. Pankaj Munjal, and Mr. Amit Gupta, and Mr.

Sanjay Singh Suryavanshi, to do all acts and deeds and things in relation to the

sanctioning of the Scheme and for the filing of present

application/affidavits/documents with statutory authorities. The affidavit of Mr.

Sanjay Singh Suryavanshi, Authorised Signatory of Applicant Company No.1 and

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Applicant Company No.2 have been filed in support of contents of the application

for seeking appropriate orders/directions.

7. The appointed date of the Scheme is 01.04.2021 as mentioned in the

Clause 1.3 of Scheme of Arrangement is attached as Annexure-1 of the

application.

8. It is stated that the Demerged Company/Applicant Company No.1 and

Resulting Company/Applicant Company No.2 have filed the audited financial

statements as on 31.03.2019, 31.03.2020 and 31.03.2021 at Annexure-3A and

Annexure-9, respectively of the application. The Demerged Company/Applicant

Company No.1 and Resulting Company/Applicant Company No.2 have also filed

unaudited balance sheets as on 30.09.2021 as Annexure- A and B of Diary

No.01125/2 dated 06.12.2021.

9. It is submitted that there are no proceedings pending inquiry or

investigation under Section 206 to 229 of the Companies Act, 2013 against the

Demerged Company and the Resulting Company.

10. It is submitted that in pursuance of the proviso to Sec. 230 (7) and Section

232 (3) of the Act, the Applicant Companies have filed the certificate issued by

Statutory Auditors certifying that the Scheme is in compliance with the

Accounting Standards under Section 133 of the Act and the same are attached

as Annexure 15 of the application.

11. It is further submitted by the counsel for applicant companies that as per

Valuation Report dated 26.08.2021 submitted by Mr. Niranjan Kumar, Registered

Valuer (SFA) bearing registration No.IBBI/RV/06/2018/10137 is attached as

Annexure-14. The Share Entitlement Ratio is given below:-

“To A-Class Equity Shareholders of HCL (Demerged Company)81,174 (Eight-One Thousand One Hundred and Seventy-Four)equity shares of HML having face value of INR 10 each fully paid

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up shall be issued for every 100 (Hundred) A-Class equity sharesheld in HCL having face value of INR 1,000 each fully paid up.

To B-Class Equity Shareholders of HCL (Demerged Company)1 (one) equity share of HML of INR 10 each fully paid up againstall outstanding B-Class equity shares of HCL.”

12. It is submitted by the learned counsel that the Scheme (Annexure-1) also

takes care of the interests of the staff/workers and employees of the Applicant

Companies. By virtue of Clause 9.1, it is stated that all permanent employees of

the Demerged Undertaking of the Demerged Company in service as on the

Effective Date shall be deemed to have become the employees of the Resulting

Company with effect from the Appointed Date without any interruption in their

service as a result of the transfer of the Demerged Undertaking to the Resulting

Company on the same terms and conditions of employment as were with the

Demerged Company. On the basis of continuity of service, the terms and

conditions of their employment with the Resulting Company shall not be less

favorable than those applicable to them with reference to the Demerged

Undertaking of the Demerged Company as on the Effective Date.

13. The Applicant Company No.1/Demerged Company and Applicant

Company No.2/Resulting Company have deposed by way of affidavit that both

the companies are unlisted companies and are not regulated by any sectoral

regulators. The affidavit of the authorised signatory is attached as Annexure-17

of the application.

14. The Applicant Companies has furnished the following documents:-

i. List of Secured and Unsecured Creditors of Applicant Company

No.1 duly certified by the Statutory Auditors (Annexure-6 and 7

respectively of the application).

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ii. List of Secured and Unsecured Creditors of Applicant Company

No.2 duly certified by the Statutory Auditors (Annexure-12 and 13

respectively of the application).

iii. Certificates of Statutory Auditors to the effect that Accounting

treatment proposed in the Scheme is inconformity with Section 133

of Companies Act, 2013 (Annexure-15 and 16 respectively of the

application).

iv. Proposed Share Entitlement Ratio (Annexure-14 of the application.)

v. Affidavit with regard to Sectoral Regulators (Annexure-17 of the

application.)

iv. Audited Financial Statement as on 31.03.2021 (Annexure-3A and

Annexure-9 respectively of the application).

v. Provisional Financial Statements as on 30.09.2021 (Annexure-A

and B of respectively Diary No.01125/2 dated 06.12.2021)

15. The Applicant Company No.1/Demerged Company i.e. Hero Cycles

Limited CIN: U35911PB1966PLC002667 is a public limited company

incorporated under the Companies Act, 1956 on 29.08.1966. The certificate of

incorporation along with Memorandum and Articles of Association is attached as

Annexure-2 of the application. The Demerged Company has total Authorised

Capital of ₹40,00,00,000/- comprising 3,98,200 Equity Shares of ‘A-Class’ of INR

1,000 each and 1800 Equity Shares of ₹1,000/- each. The Issued, Subscribed

and Paid-up Share Capital of Demerged Company is ₹39,47,62,000/- comprising

3,92,962 Equity Shares of ‘A-Class’ of INR 1,000 each and 1,800 Equity Shares

of ‘B-Class’ of INR 1,000 each.

16. The Resulting Company i.e. Hero Motors Limited CIN:

U29299PB1998PLC039602 is a Public Limited Company incorporated under the

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Companies Act, 1956 on 13.04.1998. The certificate of incorporation along with

Memorandum and Articles of Association is attached as Annexure-8 of the

application. Resulting Company/Applicant Company No.2 has Authorised Capital

of ₹161,50,00,000/- comprising of 6,20,00,000 Equity Shares of INR 10 each and

9,95,00,000 6% Non-Cumulative Convertible Redeemable Preference Shares

of ₹10/- each. The Issued, Subscribed and Paid-up Share Capital is

₹34,59,71,330/- comprising of 3,45,97,133 Equity Shares of ₹10/- each.

17. The Applicant Companies have furnished the details of the Shareholders.

Secured Creditors and Unsecured Creditors as follow:

Name of theApplicantCompanies

Shareholders along with theirconsent on affidavit

Creditors along with theirconsents on affidavit

Equity ShareholdersA-ClassB-Class

Consents submitted onaffidavit

SecuredCreditors

Consentssubmittedon affidavit

UnsecuredCreditors

Consentssubmitted onaffidavit

ApplicantCompany No.1

A-Class 13B-Class 1

A-Class 99.26%B-Class 100%

6 Nil 1383 Nil

ApplicantCompany No.2

4340 99.22% NIL NA 11 Nil

18. It is submitted that the consents of Equity Shareholders of A-Class of the

Demerged Company to the proposed Scheme has been received by way of

affidavit and the same are part of Annexure A-5 of the application. It is submitted

that as per Certificate dated 03.09.2021 issued by the Statutory Auditors, the

Demerged Company has 6 (six) secured creditors having total value of

₹5,32,33,00,000/- as on 30.06.2021 and has 1383 unsecured creditors having

total value of ₹3,87,98,73,134/- as on 30.06.2021. The certificate dated

03.09.2021 issued by statutory auditors with regard to the secured and

unsecured creditors of the Applicant Company No.1/Demerged Company are

attached as Annexure-6 and 7 respectively of the application.

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19. It is submitted that the consents of Equity Shareholders (99.22%) of the

Resulting Company to the proposed Scheme has been received by the way of

affidavit and the same are part of Annexure-11 of the application. As per

Certificate dated 03.09.2021 issued by the statutory auditors, the Resulting

Company has NIL Secured Creditors as on 30.06.2021 and 11 (eleven)

unsecured creditors having total value of ₹16,205,042/- as on 30.06.2021. The

certificate dated 03.09.2021 issued by statutory auditors with regard to the

secured and unsecured creditors of the Applicant Company No.2/Resulting

Company are attached as Annexure-12 and 13 respectively of the application. .

20. This Bench has decided the issue of dispensation of meeting of

shareholders in the cases of: CA (CAA) No.2/Chd/Hry/2021 Goibibo Group

Private Limited & Ors. dated 23.12.2021; CA No.189/2021 & CA (CAA)

No.41/Chd/Pb/2021 G.N.A Transmissions Pvt. Ltd. & Ors. dated 23.12.2021;

and CA (CAA) No.35/Chd/Hry/2021 NAM Estates Private Limited dated

23.12.2021. In the aforementioned orders, after discussing the differing views of

coordinate Benches, this Bench has followed the decisions of the Hon’ble

NCLAT in DLF Phase-IV Commercial Developers Limited and Others with

DLF Limited, (Company Appeal (AT) No.180 of 2019) dated 19.08.2019 and

Alovera Tradelink Pvt. Limited and Others Vs. Ostwal Physchem (India)

Limited in Company Appeal (AT) No.178/2019 decided on 06.08.2019 on this

issue and has held that “depending on the facts and circumstances of each case,

the NCLT has the powers to dispense with the meetings of shareholders and

others by using judicial discretion”.

21. Accordingly, the directions of this Bench in the present case are as

under:-

I. In relation to Applicant Company No.1/Demerged Company:

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a. The meetings of the Equity Shareholders is dispensed with keeping in

view the shareholding and ownership pattern of the company and the fact

that the consents by way of affidavits have been received;

b. The meetings of the Secured Creditors be convened as prayed for on

03.04.2022 at 10:00 AM through Video Conferencing with facility of

remote e-voting, subject to notice of meeting being issued. The quorum of

the meeting of the secured creditors shall be 3 in number or 40% in value

of the unsecured creditors;

c. The meetings of the Unsecured Creditors be convened as prayed for on

03.04.2022 at 2:30 PM through Video Conferencing with facility of remote

e-voting, subject to notice of meeting being issued. The quorum of the

meeting of the unsecured creditors shall be 553 in number or 40% in

value of the unsecured creditors;

II. In relation to Applicant Company No.2/Resulting Company

a. The meetings of the Equity Shareholders is dispensed with keeping in

view the shareholding and ownership pattern of the company and the fact

that the consent by way of affidavits has been received;

b. Since, there are no Secured Creditors in the Applicant Company No.2.

Therefore, there is no scope for any meeting;

c. The meeting of the Unsecured Creditors is to be convened as prayed for

on 03.04.2022 at 12.:30 PM through Video Conferencing with facility of

remote e-voting, subject to notice of meeting being issued. The quorum of

the meeting of the unsecured creditors shall be 7 in number or 40% in

value of the unsecured creditors;

III. In case the required quorum as noted above for the meetings is not

present at the commencement of the meeting, the meeting shall be

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adjourned by 30 minutes and thereafter the persons present and voting

shall be deemed to constitute the quorum.

IV. Mr. Justice M.S. Sullar (Retd.), address #220, Sector 25-A, Panchkula,

Mobile No.7380155555, email id: [email protected], is

appointed as the Chairperson for the meeting to be called under this

order. An amount of ₹2,00,000/- (Rupees Two Lakhs Only) be paid for

his/her services as the Chairperson.

V. Mr. Karanveer Jindal, Advocate, R/o D/990/2013, SCO 7-8, 4th Floor,

Jandu Tower, Miller Ganj, GT Road, Ludhiana, Punjab - 141003, Mobile

No.9888972565, e-mail id: [email protected], is appointed as the

Alternate Chairperson for the meeting to be called under this order. An

amount of ₹1,50,000/-(Rupees One Lakh Fifty Thousand Only) be paid for

his/her services as the Alternate Chairperson.

VI. Ms. Swati Saluja, Advocate address: #322A, Sector 15 Panchkula, Mobile

No.8605090031, email id: [email protected], is appointed as the

Scrutinizer for the above meeting to be called under this order. An amount

of ₹1,00,000/- (Rupees One Lakh Only) be paid for his/her services as the

Scrutinizer.

VII. The fee of the Chairperson, Alternate Chairperson and Scrutinizer and

other out of pocket expenses for them shall be borne jointly by the

Applicant Company No.1/Demerged Company and Applicant Company

No.2/Resulting Company.

VIII. It is further directed that individual notices of the said meetings shall be

sent by Applicant Company No.1/Demerged Company and Applicant

Company No.2/Resulting Company through registered post or speed post

or through courier or e-mail, 30 days in advance before the schedule date

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of meeting, indicating the day, date, the place and time as aforesaid,

together with a copy of the Scheme, copy of explanatory statement with

Valuation Report as discussed in paras 4 of this order required to be sent

under the Companies Act, 2013 and the applicable Rules and any other

documents as may be prescribed under the Act shall also be duly sent

with the notice.

IX. It is further directed that along with the notices, Applicant Company

No.1/Demerged Company and Applicant Company No.2/Resulting

Company shall also send, statements explaining the effect of the scheme

on the creditors, key managerial personnel, promoters and non-promoter

members etc. along with effect of the arrangement on any material

interests of the Directors of the Company or the debenture trustees, if any,

as provided under sub-section (3) of Section 230 of the Act.

X. It is also directed that the provisional accounting statement of Applicant

Company No.1/Demerged Company and Applicant Company

No.2/Resulting Company as on 30.09.2021 or as on a subsequent date be

also circulated for the aforesaid meeting in terms of Section 232 (2) (e) of

the Act.

XI. That the Applicant Company No.1/Demerged Company and Applicant

Company No.2/Resulting Company shall publish advertisement with a gap

of at least 30 clear days before the aforesaid meeting, indicating the day,

date and place and the time of meeting as aforesaid, to be published in

“Indian Express” (English, Chandigarh Edition) and “Jagbani” (Punjabi,

Ludhiana Edition); It be stated in the advertisement that the copies of

“Scheme”, the Explanatory Statement required to be published pursuant to

Section 230 to 232 of the Act. The Applicant Company No.1/Demerged

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Company and Applicant Company No.2/Resulting Company shall also

publish the notice on its website, if any.

XII. It shall be the responsibility of the Applicant Company No.1/Demerged

Company and Applicant Company No.2/Resulting Company to ensure that

the notices are sent under the signature and supervision of the authorized

representative of the company on the basis of Board resolutions and that

they shall file their affidavits in the Tribunal at least ten days before the

date fixed for the meeting.

XIII. Voting shall be allowed on the “Scheme” through electronic means which

will remain open for a period as mandated under Clause 8.3 of Secretarial

Standards on General Meetings to the Applicant Company

No.1/Demerged Company and Applicant Company No.2/Resulting

Company under the Act and the Rules framed thereunder.

XIV. The Scrutinizer’s report will contain his/her findings on the compliance to

the directions given in Para VIII to XIII above.

XV. The Chairperson shall be responsible to report the result of the meeting to

the Tribunal in Form No. CAA-4, as per Rule 14 of the Companies

(Compromises, Arrangements and Amalgamations) Rules, 2016 within 7

(seven) days of the conclusion of the meeting. He would be fully assisted

by the authorized representative/Company Secretary of the Applicant

Company No.1/Demerged Company and Applicant Company

No.2/Resulting Company, and the Scrutinizer, who will assist the Hon’ble

Chairperson and Alternate Chairperson in preparing and finalizing the

report.

XVI. The Applicant Company No.1/Demerged Company and Applicant

Company No.2/Resulting Company shall individually and in compliance of

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sub-section (5) of Section 230 of the Act and Rule 8 of Companies

(Compromises, Arrangements and Amalgamations) Rules, 2016 send

notices in Form No. CAA-3 along with copy of the Scheme, Explanatory

Statement and the disclosures mentioned in Rule 6 of the “Rules” to (i)

Central Government through the Regional Director (Northern Region),

Ministry of Corporate Affairs, New Delhi (ii) Registrar of Companies,

Punjab and Chandigarh (iii) Official Liquidator; (iv) Income Tax

Department through the Nodal Officer – Principal Commissioner of Income

Tax, NWR, Aayakar Bhawan, Sector 17-E, Chandigarh by mentioning the

PAN number of the Applicant Companies; and such other Sectoral

Regulator(s) governing the business of the Transferee Companies, if any,

stating that representation, if any, to be made by them shall be sent to the

Tribunal within a period of 30 days from the date of receipt of such notice

and copy of such representation shall be simultaneously sent to the

concerned companies, failing which it shall be presumed that they have no

objection to the proposed Scheme.

XVII. The Applicant Company No.1/Demerged Company and Applicant

Company No.2/Resulting Company shall furnish a copy of the Scheme

free of charge within one day of any requisition for the Scheme made by

any creditor or member/shareholder entitled to attend the meeting as

aforesaid.

XVIII. The authorized representative of the Applicant Company No.1/Demerged

Company and Applicant Company No.2/Resulting Company shall furnish

an affidavit of service of notice of meeting and publication of

advertisement and compliance of all directions contained herein at least a

week before the proposed meeting.

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XIX. All the aforesaid directions are to be complied with strictly in accordance

with the applicable laws including forms and formats contained in the

Rules as well as the provisions of the Companies Act, 2013 by the

Applicant Company No.1/Demerged Company and Applicant Company

No.2/Resulting Company.

22. With the aforesaid directions, this First Motion Application stands disposed

of. A copy of this order be supplied to the learned counsel for the Applicant

Companies who in turn shall supply a copy of the same to the Chairperson,

Alternate Chairperson and the Scrutinizer immediately.

Sd/- Sd/-(Subrata Kumar Dash) (Harnam Singh Thakur)Member (Technical) Member (Judicial)

January 06, 2022AV

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Annexure A

INSTRUCTIONS FOR SECURED CREDITORS TO VOTE THROUGH REMOTE E-VOTING:

The remote e-voting for the Secured Creditors Meeting of Hero Cycles Limited begins on March 30, 2022 at 9:00 A.M. and ends on April 02, 2022 at 5:00 P.M.

Instructions:

1. Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a Personal Computer or on a mobile.

2. Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholder / Member’ section.

3. Anewscreenwillopen.YouwillhavetoenteryourUserID,yourPasswordandaVerificationCodeasshown on the screen.

4. Your Login id and password details casting your vote electronically and for attending the Meeting of CreditorsthroughVC/OAVMareattachedinthepdffileenclosedherewith.Pleasenotethatthepasswordtoopenthepdffileistheuniqueidmentionedabove.

5. Forthefirsttimethesystemwillasktoresetyourpassword.

6. After entering your password, tick on Agree to “Terms and Conditions” by selecting on the check box.

7. Now, you will have to click on “Login” button.

8. After you click on the “Login” button, Home page of e-Voting will open.

9. You will be able to see the EVEN no. of the company.

10. Click on “EVEN” of company to cast your vote.

11. Now you are ready for e-Voting as the Voting page opens.

12. Cast your vote by selecting appropriate options i.e. assent or dissent, and click on “Submit” and also “Confirm”whenprompted.

13. Uponconfirmation,themessage“Votecastsuccessfully”willbedisplayed.

14. Youcanalsotaketheprintoutofthevotescastbyyoubyclickingontheprintoptionontheconfirmationpage.

15. Onceyouconfirmyourvoteontheresolution,youwillnotbeallowedtomodifyyourvote

16. Ifyoufaceanyproblems/experienceanydifficultyor Ifyouforgotyourpasswordplease feel free tocontact toll free number 1800 1020 990 /1800 224 430 or contact on email id [email protected]

INSTRUCTIONS FOR SECURED CREDITORS FOR E-VOTING ON THE DAY OF THE SECURED CREDITORS MEETING:

1. The procedure for e-Voting on the day of the Secured Creditor Meeting is same as the instructions mentioned above for remote e-voting.

2. Only those Creditors , who will be present in the Secured Creditors meeting through VC / OAVM facility and have not casted their vote on the Resolutions through remote e-Voting and are otherwise not barred from doing so, shall be eligible to vote through e-Voting system in the Secured Creditors Meeting.

INSTRUCTIONS FOR SECURED CREDITORS FOR ATTENDING THE SECURED CREDITORS MEETING THROUGH VC/OAVM:

1. Creditors will be provided with a facility to attend the Secured Creditors Meeting through VC/OAVM through the NSDL e-Voting system. Creditors may access the same at https://www.evoting.nsdl.com under shareholders/members login by using the remote e-voting credentials. The link for VC/OAVM will be available in shareholder/members login where the EVEN of Company will be displayed.

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2. Facility for joining the meeting through video conferencing shall be open 15 minutes before the time scheduledfor themeetingandwillbeavailable to thesecuredcreditorsonfirstcomefirstservebasis.Securedcreditorsarerequestedtoparticipateonfirstcomefirstservebasisasparticipationthroughvideoconferencingislimitedandwillbeclosedonexpiryof15(fifteen)minutesfromthescheduledtimeofthemeeting.Securedcreditorscanloginandjoin15(fifteen)minutespriortothescheduletimeofthemeetingandwindowforjoiningshallbekeptopentilltheexpiryof15(fifteen)minutesafterthescheduletime.

3. Secured creditors who would like to express their views/have questions may send their questions inadvance mentioning their name, demat account number/folio number, email id and mobile number at [email protected]. The same will be replied by the Company suitably. Secured creditors who wouldliketoexpresstheirviews/askquestionsduringthemeetingmayregisterthemselvesasaspeakerbysendingtheirrequestmentioningtheirname,demataccountnumber/folionumber,emailidandmobilenumber at [email protected].

4. Thefirst10(ten)Speakersonfirstcomebasiswillonlybeallowedtoexpresstheirviews/askquestionsduring the meeting.

Note:

Those secured creditors who have registered themselves as a speaker will only be allowed to express their views/askquestionsduringthemeeting.TheCompanyreservestherighttorestrictthenumberofspeakersdependingon the availability of time for the meeting.

Regards,

e-Voting support desk

NationalSecuritiesDepositoryLimited(www.nsdl.co.in)

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Documents

HERO CYCLES LIMITED CIN