JCT Electronics Updates on BIFR order

JCT Electronics Ltd has announced that the Hon'ble Board for Industrial and financial reconstruction (BIFR) have issued to the Company on March 26, 2007 their orders sanctioning the scheme of rehabilitation for the Company. The main features of the sanctioned scheme are as under :

1. The sanctioned scheme shall come into force with immediate effect in so far as they relate to applicable provisions of the scheme.

2. The cut off date for the sanctioned scheme will be March 31, 2007.

3. Reduction in the rate of interest on unpaid balances of the Financial Institutions & Banks from the cut off date @ 6% p.a. The future interest shall be payable with effect from October 01, 2008.

4. Repayment of the principal outstandings of the financial institutions and banks as on the cut off date from December, 2008 onwards in quarterly installments.

5. Waiver of all past interest / compound interest / liquidated damages / penal interest etc.

6. Shifting of the entire plant and machinery of the Mohali Unit to Baroda and installing the same as Line - III at the Baroda Unit.

7. Sale of all Mohali Assets i.e. Land, Buildings, structures thereon and other redundant / unserviceable assets. The Asset Sale Committee to be constituted with representation from the Lead FI / Lead Bank / BIFR Nominee / Punjab Govt. Nominee / Company's representative shall monitor the sale and take necessary steps in this regard as per BIFR guidelines. The Asset Sale Committee shall seek the permission of BIFR before finalizing the sale transaction.

8. Utilize the sale proceeds of the Mohali unit to liquidate some of the debts of the term lenders / banks, make payment to the foreign banks on a one time settlement of their principal outstanding and also settle the legal dues in arrears (worker’s past liability) of the Mohali workmen as per approval of BIFR.

9. Workmen of the Mohali unit to be given employment at the Baroda unit on the terms and conditions as applicable to similar workmen at the Baroda unit. In case of any worker not opting for shifting / transfer, their legal dues to be paid as per settlement.

10. Capital reduction through write down of the existing paid-up equity share capital as on the date of sanction of the scheme by 90%.

11. Conversion of the share application money in the books into equity shares after write down of existing equity.

12. Promoters contribution of Rs 2500 lakhs towards upfront payment to lenders (Rs 750 lakhs) and capital expenditure (Rs 1750 lakhs) to be converted into equity share capital by issue of equity shares after write down of existing equity.

13. Conversion of 15% of the principal outstanding of the term loans / working capital term loans into equity shares after write down of existing equity.

14. Pledge of the entire shareholding of the promoters post restructuring (after equity w/down, conversion and fresh induction) with the lead institution.

15. Personal guarantee of Mr. Arjun Thapar, Managing Director to be provided on the entire outstanding loans of the financial institutions / banks.

16. Sanction of need based non funded limits of Rs 5054 lakhs for working capital requirements.

The said sanctioned scheme shall be placed before the Board of Director at a meeting to be convened shortly and thereafter necessary action shall be initiated to comply with various terms of the scheme.

Source : Equity Bulls

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