NOTICE OF POSTAL BALLOT
[Pursuant to Section 110 of the Companies Act, 2013 read with Rule 22 of the Companies (Management and Administration) Rules, 2014]
NOTICE is hereby given to the shareholders of ABC SERVICES LIMITED (the “Company”) that the resolutions appended below are proposed to be passed by the Shareholders through Postal Ballot (“Postal Ballot”) by way of remote e-voting (“e-voting / remote e-voting”) as Resolution(s), in accordance with the provisions of Section 110 and other applicable provisions, if any, of the Companies Act, 2013 (hereinafter referred as “the said Act”) read with the Companies (Management and Administration) Rules, 2014 (hereinafter referred as “the Rules”) including any statutory modification(s) or re-enactment(s) thereof for the time being in force.
1. To consider and approve the Material Related Party Transactions
To consider and, if thought fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “Listing Regulations”) and any other applicable provisions, including any amendment, modification, variation or re-enactment thereof, the Members of the Company do hereby ratify as also accord further approval to the Board of Directors of the Company (hereinafter referred to as the “Board” which term shall be deemed to include any committee(s) constituted/to be constituted by the Board, from time to time, to exercise its powers conferred by this resolution), for entering into and/ or carrying out and/or continuing with contracts, arrangements and transactions (whether individual transaction or transactions taken together or series of transactions or otherwise) with ABC, being a related party, whether by way of renewal(s) or extension(s) or modification(s) of earlier contract/arrangements/ transactions or otherwise, with respect to (i) Banking services/loan transactions/credit facility including all forms of borrowings/Fixed Deposits/Investments (ii) Finance Charges/Bank Charges/fee & Commission (iii) Advertisement/Marketing/Sourcing of Cards (iv) Payment of Royalty at the rate of 0.20% of Total Income or 2% of Profit after Tax, whichever is higher (v) Corporate Card facility (vi) Cost allocation and/or other transactions including transactions as may be disclosed in the notes forming part of the financial statements for the relevant period notwithstanding the fact that all these transactions during the financial year 2019-20, in aggregate have exceeded 10% of the annual consolidated turnover of the Company for the relevant year and shall continue to qualify as material related party transactions for the FY 2020-21 and onwards on the basis of materiality threshold as may be applicable, from time to time.”
“RESOLVED FURTHER THAT pursuant to Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as “Listing Regulations”) and any other applicable provisions, including any amendment, modification, variation or re-enactment thereof, the Members of the Company do hereby ratify as also accord further approval to the Board of Directors of the Company (hereinafter referred to as the “Board” which term shall be deemed to include any committee(s) constituted/ to be constituted by the Board, from time to time, to exercise its powers conferred by this resolution), for entering into and/or carrying out and/or continuing with contracts, arrangements and transactions (whether individual transaction or transactions taken together or series of transactions or otherwise) with ABC Capital Markets Limited (“ABC CAP”), being a related party, whether by way of renewal(s) or extension(s) or modification(s) of earlier contract/arrangements/ transactions or otherwise, with respect to certain Capital/debt market services, Corporate Credit Card facility, borrowings, investments and other transactions as may be disclosed in the notes forming part of the financial statements for the relevant period notwithstanding the fact that all these transactions during the financial year 2019-20, in aggregate have exceeded 10% of the annual consolidated turnover of the Company for the relevant year and shall continue to qualify as material related party transactions for the FY 2020-21 and onwards on the basis of materiality threshold as may be applicable, from time to time.”
“RESOLVED FURTHER THAT the Members of the Company do hereby ratify as also accord further approval to the Board to sign and execute all such documents, agreements and writings and to do all such acts, deeds, matters and things as may be deemed necessary, expedient and incidental thereto and to delegate all or any of its powers herein conferred to any Committee of Directors and/or director(s) and/or officer(s) of the Company, to give effect to this resolution.”.
By order of the Board of Directors For ABC Services Limited
(formerly known as ABC Services Pvt. Ltd.)
Date:
Place: Delhi
MR. XYZ
Company Secretary & Compliance Officer
EXPLANATORY STATEMENT CONTAINING MATERIAL FACTS PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013
Item 1
To consider and approve the Material Related Party Transactions
Pursuant to Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) and the Company’s Policy on Related Party Transactions all Material Related Party Transactions shall require the approval of the shareholders as per the Listing Regulations even if such transactions are in the ordinary course of business of the concerned company and at an arm’s length basis.
A transaction with a related party shall be considered material under the Listing Regulations, if the transaction(s) in a contract to be entered into individually or taken together with previous transactions during a financial year, exceeds 10% of the annual consolidated turnover of the company as per the last audited financial statements of the company.
However, a transaction pertaining to payments made to a related party with respect to brand usage or royalty shall be considered material if the transaction(s) to be entered into individually or taken together with previous transactions during a financial year, exceed five percent of the annual consolidated turnover of the Company as per the last audited financial statements of the Company.
ABC and ABC Capital Markets Limited (ABC CAP) are related parties of the Company pursuant to Section 2(76) of the Companies Act, 2013 and the Company enters into various contracts/ arrangements/transactions with them as disclosed in the notes forming part of the financial statements. In the financial year 2019-20, the aforementioned transactions in terms of aggregate value in respect of both the said related parties severally, have exceeded 10% of the Company’s annual consolidated turnover for the relevant year. The transactions have been continued so far in the financial year 2020-21 and are expected to exceed the prescribed threshold limits under the Listing Regulations and other laws as may be applicable from time to time so as to qualify as material related party transactions. Going forward also, the Company intends to continue such transactions with ABC and ABC CAP.
Accordingly, as per Regulation 23 of the Listing Regulations, approval and/or ratification of the Members is sought for the arrangements/ transactions undertaken whether by way of continuation/ extension/ renewal/ modification of earlier arrangements/ transactions/to be undertaken by the Company.
Accordingly, the Company proposes to obtain approval of its Members for ratifying as also for giving further approval to the Board for carrying out and/or continuing with the following arrangements and transactions with ABC and ABC CAP:
ABC
- Banking services/loan transactions/credit facility including all forms of borrowings/Fixed Deposits
Investments
- Finance Charges/Bank Charges/fee & Commission
- Advertisement/Marketing/Sourcing of Cards
- Payment of Royalty at the rate of 0.20% of Total Income or 2% of Profit after Tax, whichever is higher
- Corporate Card facility
- Cost allocation and other transactions including transactions as may be disclosed in the notes forming part of the financial statements for the relevant period
ABC CAP
- Certain Capital/debt market services
- Corporate Credit Card facility
- Borrowings/investments
- and other transactions as may be disclosed in the notes forming part of the financial statements for the relevant period.
The above stated arrangements and transactions with ABC and ABC CAP amount to related party transactions falling within the purview of the Listing Regulations and all these transactions in aggregate, are material related party transactions under the Listing Regulations.
None of the Directors or Key Managerial Personnel of the Company or their relatives, are in any way, concerned or interested, financially or otherwise, in the resolution as set out at Item No. 1 of this Notice except to the extent of their employment/nomination by ABC/employment in the Company, if any and their shareholding in the Company/ABC/ABC CAP, if any.
ABC being promoter of the Company and the promoter and holding company of ABC CAP, shall be deemed to be interested in the proposed resolutions.
The Members may please note that in terms of the provisions of the Listing Regulations, no related party/ies shall vote to approve on the resolution under Item No.1
The Board of Directors at its meeting held on June 8, 2020 recommended the passing of the resolutions set-out under Item No. 1 of the Notice as an Ordinary Resolution.
By order of the Board of Directors For ABC Services Limited
(formerly known as ABC Services Pvt. Ltd)
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