Most Important Terms & Conditions

Most important Terms and Conditions (“MITC”)

Definitions

The definition of terms and expressions used in the MITC, unless the context otherwise requires, are as follows:

1. ''Asset(s)'' shall collectively or otherwise referred specifically for the context herein shall mean certain equipment, machinery and/or vehicles used in construction activity and/or in support of construction activity and/or mining activity and/or material handling activity and/or industrial activity and/or agricultural activity and/or medical /healthcare activity and/or for personal usage and/or include all type of motor vehicle and/or two wheeler and/or three wheeler and/or four wheeler consumer durables and more particularly described in the Second Schedule, either new, pre-owned or already registered, with its accessories, accretions, fittings, etc. and replacements to the asset/vehicle whenever made, including by way of body building and engine up-gradation, which is sought to be owned by the Borrower(s) or upon which the Loan is made acceptable to KFL, either wholly or in part, and which is deemed to be hypothecated/kept as security against which KFL has granted the Loan.
2. "Annualized Rate of Interest" means the interest at the Annualized Rate of Interest as mentioned in the Sanction Letter, compounded with monthly rests on the outstanding principal balance;
3. "Borrower(s)" shall mean any person referred to as 'Borrower(s)' and the 'Co Borrower(s)', and shall include the 'Guarantor(s)' in the Sanction Letter and shall unless repugnant to the context or meaning thereof be deemed to include: (i) in case the Borrower(s) is a company incorporated under the Companies Act, 1956 or 2013, its successors and permitted assigns; (ii) in case the Borrower(s) is a partnership firm formed under the Partnership Act, 1932, the partners for the time being and the legal heirs, executors and administrators of the last surviving partner, (iii) in case the Borrower(s) is a sole proprietorship, the sole proprietor and his/her heirs, administrators and executors and legal representatives; (iv) in case the Borrower(s) is a hindu undivided family (HUF), including the Karta and any or each of the adult members of the HUF and their survivor(s) and his/her /their respective heirs, legal representatives, executors, administrators and permitted assigns;(v) in case the Borrower(s) is the governing body of a society, the respective successors of the members of the governing body and any new members elected, appointed or co-opted; (vi) in case the Borrower(s) is a trust, the trustee or trustees for the time being and from time to time thereof, as well as the beneficiaries of the said trust for the time being and from time to time, and their successors and permitted assigns; (vii) in case the Borrower(s) is an individual, his/her respective heirs, administrators and executors; (viii) in case the Borrower(s) is a limited liability partnership formed under the Limited Liability Partnership Act, 2008, its successors and permitted assigns;
4. "Cheque(s)" including "Post Dated Cheque(s)" or "PDCs" means cheque(s) issued by the Borrower(s) in favor of KFL, for the amount towards Installment, specified in the Sanction Letter and also includes cheques issued for other amounts, payments, charges, dues etc.;
5. "Co- Lending Partner(s)" shall mean and include to any person(s)/ bank/ financial institution/ asset reconstruction companies/ entity under co-lending model or by way of direct assignment or any other arrangement, on such terms and conditions as KFL may deems fit;
6. "Dealer" means the person who is in the business of booking, procuring, stocking, selling and/or servicing the vehicles, new and/or used, from whom the Borrower(s) may purchase the vehicle;
7. "Due Date" means the date(s) on which any amounts from the Borrower(s) to the Lender including the principal amounts of the Loan, interest and/or any other Dues, fall due as per the Loan Documents or as demanded by the Lender.
8. "Loan Documents'' means collectively:

1. Loan Application Form;
2. Sanction Letter or Welcome Letter
3. Loan Agreement with all the Schedules;
4. the Arbitration Agreement;
5. Additional Loan Agreement Addendum, if any;
6. Demand Promissory Note and Letter of Continuity for Demand Promissory Note;
7. Declaration(s) executed by the Borrower(s) in favour of Lender;
8. Irrevocable Power of Attorney;
9. any other document executed from time to time pursuant to any of the foregoing to which the Borrower(s) or the Lender is a party; and
10. any other agreement or document which the Lender designates as a Loan Document;

"Dues" shall mean and include the outstanding principal amount of the Loan, defaulted amounts, late payment interest(LPI), interest on the Loan, all other interest, fees, costs, charges, expenses, stamp duty and all other sums whatsoever payable by the Borrower(s) to the Lender in accordance with this Agreement and all other documents forming part of this Agreement, as well as all other monies whatsoever stipulated in or payable by the Borrower(s) under the Loan Documents.
The terms and expressions not herein defined shall, where the interpretation and meaning have been assigned to them in terms of the General Clauses Act, 1897, have that interpretation and meaning.
All terms used in singular shall unless the context requires otherwise include plural and a reference to one gender shall include all genders.

Part A – Obligation of the Borrower/Co-borrower/Guarantor (“Borrower”)

The Borrower is required to submit CKYC Identifiers and other KYC details in accordance with the KYC Policy of the Kogta Financial (India) Limited (“Company” or “KFL”) (available on the Company’s website at https://www.kogta.in/investor/policy/) such as information/document on his/her/its identify, age, address, signature, photograph, occupation, bank account, income for availing the loan facility. The Borrower is providing consent to the Company to digitally verify the submitted documents i.e. Aadhar, PAN, etc. wherever possible, else Borrower shall submit documents which are self-attested. The Borrower agrees and confirms that he/she/they will furnish any additional document(s)/ information(s) as and when required by the Company.
The Borrower agrees and confirms that the Company can store, share, inspect, update and download the information/document provided by the Borrower, from time to time, or records available with Central KYC Records Registry (CKYCR)/UIDAI/Government websites for compliance with Know Your Borrower (KYC) Direction, 2016 issued by the Reserve Bank of India (“RBI”), as amended from time to time and the KYC policy of the Company. The Borrower is providing consent to open a loan account through using both OTP based e-KYC or biometric based e-KYC. Borrower will also provide such information and documents as required for periodic updation of KYC.
The Borrower is citizen of India.
The Borrower undertakes to use the funds only for the purpose for which the loan has been applied and shall not be used for speculative or antisocial purposes.
The Borrower shall not take loan from any other bank/finance Company without specifically declaring the same to the Company.
Registration with the Ministry of MSME, Govt. of India, can help micro-enterprises in improved access to bank credit and other government services. Government has approved a special process through which NBFC can help their micro-enterprise Borrowers to obtain Udyam Registration Number by sharing their basic information (including Aadhaar) with Udyam Assist Platform (www.udyamassist.gov.in). The Borrower is providing consent to the Company for sharing the required information for getting Udyam Registration.
The Borrower is providing the consent to the Company to disclose information furnished by them in the loan documents executed/ to be executed in relation to the facilities to be availed by the Borrower, to the Company’s other branches/ affiliates/ Credit Bureaus/ Rating Agencies, Service Providers, banks/ financial institutions, government/ regulatory, authorities or third parties for information verification, credit risk analysis, or for other related purpose that the Company may deem fit.
The Borrower is liable to pay all charges, fees, interest, costs wherever applicable, as defined in the Schedule of Charges of the Company, as applicable from time to time, levied in respect to the loan account.
The Borrower is required to disclose any pending litigation against him/her/them filed by any other financier/bank.
Any change in residential, permanent or office address of the Borrower(s) will be intimated to the Company in writing within seven (7) days of such change. In the absence of intimation of change, any letter, notice, correspondence sent to the given/ available address by the Company shall deemed to be proper service.
The Borrower(s) hypothecates and creates a first and exclusive charge upon the Asset(s) in favour of the Company. In case of multiple Asset(s), the hypothecation shall be on each and every Asset(s) for securing the entire Dues and all such Asset(s) shall be discharged only upon full and final discharge of all Dues to the satisfaction of the Company.
The Borrower will have a lien over other Asset(s) (financed by the Company under any other agreement), monies, security deposits, etc. (held under the Loan Agreement or any other agreement by the Company), of the Borrower(s) which is within Company’s control and upon default committed under the Loan Agreement, the Company shall have the right to set off /appropriate /freeze such monies, deposits, vehicles, etc. as against any monies due to the Company from the Borrower(s) under the Loan Agreement.
The Borrower is providing consent/approval to the Company, to solicit, market its various other add-on products, schemes to the Borrower(s) through calls, text messages, emails or any other mode of communication irrespective of them registering themselves in "Do Not Call Registry".

Part B – Most Important Terms and Conditions of Loan

The loan facility granted/to be granted to Borrower is subject to rules and regulations introduced or amended from time to time by the RBI and in accordance with the various policies and procedures of the Company.
The Loan application will be sanctioned by the Company only after carrying out a due diligence of the Borrower in accordance with the Know Your Borrower guidelines as prescribed by RBI. All Original documents are to be provided for verification before disbursement/sanction of loan.
The Company reserves its right to reject the loan application till the time of disbursement of loan and in case of rejection, the Company is not required to give any reason for rejection and shall retain the loan document(s) along with the photograph of the Borrower in accordance with the RBI directions.
The quantum of loan applied and sanctioned loan amount can differ at the sole discretion of the Company. Disbursement is subject to Satisfactory Credit Verification, Legal and technical clearance.
The Company will charge annualized rate of interest during the term of the loan facility unless mandated by the RBI or other regulatory authorities or unforeseen or exceptional changes in money market conditions. In such event, the Borrower(s) agrees to pay interest on such revised rate.
The Company will circulate the loan related information like "welcome letter", "repayment schedule", "loan agreement, "disbursal advise (as applicable to Loan)", through e-mail or message on mobile number provided by the Borrower. The Borrower may also request for a physical copy of Welcome Letter and Repayment Schedule separately if need be.
The Borrower acknowledges that the utilization of the FLDG/ security deposit is to be decided by the Company at its sole discretionary power. Further, the Company has the option to adjust the FLDG/ security deposit against any Dues payable by the Borrower(s). If the deposit is made by any person, who is not a Party to the Loan Agreement, on behalf of the Borrower(s), the security deposit is to be accompanied by an authorization letter authorizing the Company to treat the same as security deposit made by the Borrower(s). The security deposit thereon shall be refunded by the Company to the Borrower(s), after adjusting the same against any Dues payable by the Borrower(s) towards the Loan.
The Borrower acknowledges that the utilization of the DSRA shall be decided by the Company at its sole discretionary power. Further, the Company has the option to adjust the DSRA against any Dues payable by the Borrower(s). The DSRA thereon shall be refunded by the Company to the Borrower(s), after adjusting the same against any amount due and payable by the Borrower(s) towards the Loan.
The Company is only a finance provider and subsequent to vehicle/ asset finance disbursement to the dealer, the Company has no liability towards condition/ colour/ make/ performance quality of vehicle/ asset at the time of delivery/ delay in delivery of vehicle/ accessories/ spare-part from the dealer or availability of specific colour/ model/ quality/ version at the dealership. Any discount in pricing of the asset is purely an offer by the manufacturer/ dealer.
In case of loan cancellation, the application pro-rata interest charges on any outstanding loan amount will be borne by the Borrower along with the loan cancellation charges as applicable.
The Company may enter into co-lending arrangement with various banks/financial institutions, without any approval of or notice to any of the Borrower, for which the Company can assign its rights and obligations (including the dues/Loan or any part thereof with or without any Security) under the Loan Documents to the extent as per the respective arrangement/agreement with Co-Lending Partner(s) on such terms and conditions as the Company solely deems fit, without any requirement of an approval or intimation from/to the Borrower(s). The details of Co-Lending Partners and co-lending policy can be accessed on the Company's website at https://www.kogta.in/investor/policy/.
The Company, without any approval of or notice to any of the Borrower, shall be entitled to assign any/all of its rights and obligations (including the borrower's dues/Loan or any part thereof with or without any Security) under the loan documents to any person(s)/ bank/ financial institution/ asset reconstruction companies/ entity by way of direct assignment or any other arrangement, on such terms and conditions as the Company may deems fit.
The Company offers add-on products to the Borrower such as Loan Suraksha Policy (Credit Sheild Policy covering either life or accidental death or hospitalization), Fire Insurance Policy, Hospitalization Daily Cash, Motor Insurance Policy, IHO/Medibuddy, Roadside assistance etc. which are optional for the Borrower. On opting such products, the product cost and processing charges, as applicable, may be deducted from the loan amount as per customer convenience.
The Company is entitled at its discretion to engage/avail of, services of any person/third party service provider/agent/agency, for anything required to be done for/in relation to/pursuant to any of the products/services offered, including collections, recovery of dues, enforcement of security, getting or verifying any information of the Borrower/assets, and any necessary or incidental lawful acts/deeds/matters and things connected thereto, as the Company may deem fit.
The Borrower(s) shall keep the Asset(s) insured at all times as per satisfaction of the Company. In case the Company gets the Asset(s) insurance done on behalf of the Borrower(s) on his specific request, the insurance premium amount shall be treated as an additional loan and the interest on the same would be charged as mutually agreed in the application form of Loan at the time of such request. The Company reserves its right to adjust any subsequently received EMI of the main Loan facility as against the additional loan on a first in first out basis.
In order to safeguard the Security for the Loan and to ensure that the Company’s lien is marked on the insurance, the Company may get the insurance done on behalf of the Borrower(s), by being a facilitator and making the premium payment to the approved insurance Company through the Borrower(s) payments instruments including Post Dated Cheque(s)/ pay orders/any other payment instructions. However, any non-payment on the part of the Company, due to any reason whatsoever, shall not affect the liability of the Borrower(s) to pay the necessary insurance premium and to keep the Asset(s) insured.
The Company has established a suitable mechanism for receiving and addressing complaints from its Borrowers/Employees/Investors and Third-Party constituents with specific emphasis on resolving such complaints fairly and expeditiously regardless of source of the complaint. The Company has a dedicated Customer care department and appoints a Grievance Redressal Officer at the Company to handle the timely redressal of complaints. The Complaints can be raised at complaints@kogta.in or customercare@kogta.in or through the website of the Company at www.kogta.in/pages/contact-us/. and if the Borrower is not satisfied with the resolution of the Company or does not receive a response for the compliant, they can approach the Ombudsman appointed by the RBI for redressal.
The Company shall recognize incipient stress in loan accounts, immediately on default, by classifying such assets as special mention accounts (SMA) and Non-Performing Assets (NPA) wherein the principal or interest payment or any other amount wholly or partly overdue as per the following categories:

1-30 days as SMA – 0

31-60 days as SMA-1

61-90 days as SMA-2

90th days as NPA

The detailed SMA classification is hosted on the website of the Company which can be accessed at https://www.kogta.in/media-center/Customer-awareness/.

Example explaining the entire process:

If due date of a loan account of the Borrower is 5^th March, 2021 and full dues are not received on this date, the date of overdue shall be end of the day on 5^th March, 2021 and the loan account shall be classified as SMA–0.
If the loan account continues to remain overdue on 4^th April, 2021 i.e. upon completion of 30 days of being continuously overdue, then this account shall be classified as SMA-1 on 4^th April, 2021.
If the loan account continues to remain overdue upon running day-end process on 4^th May, 2021 i.e. upon completion of 60 days of being continuously overdue, it shall be classified as SMA-2 on 4^th May, 2021.
If the loan account continues to remain overdue upon running day end process on 3^rd June 2021 i.e. upon completion of 90 days of being continuously overdue, it shall be classified as NPA on 3^rd June 2021.

* The date(s) mentioned above are for illustration purpose only.

Once the Loan Account is fully satisfied in accordance with the terms & conditions of Loan Agreement, the Borrower needs to collect the Loan NOC and original property documents (if any) either from the Branch Office from where loan was serviced or from the Corporate Office of the Company. For this purpose, the Borrower or his/her legal heir (in case of demise of the borrower) needs to submit a written request and the NOC and Property documents will be provided within 30 Days from the date of such request. Please note that any cheques for EMI or Security (if any) given at the time of the loan shall be destroyed at the Company’s end and shall not be returned. The detailed procedure is hosted on the website of the Company which can be accessed at https://www.kogta.in/media-center/Customer-awareness/.
Events Of Default

For all loan products except LAP & MSME

The following events shall constitute "Events of Default"-

The Borrower(s) failing to repay the Dues in the manner contained in loan documents and any one of the Installments or any other Dues remains unpaid after Due Date; or
The Borrower(s) (in case of being an individual and in case more than one, anyone of them) dies or suffers from lunacy or similar other condition or any steps are taken with a view to his being made insolvent in any jurisdiction or with a view to the appointment of a receiver, trustee or similar officer of any of his property, Asset(s); or
If the Borrower(s) (in case of being a corporation or a partnership firm) takes any action or other steps are taken or legal proceedings are initiated by any third party against the Borrower(s) for winding up, insolvency, liquidation, dissolution or reorganization or for the appointment of a receiver, trustee or similar officer on its Asset(s); or
If the Borrower(s) sells, encumbers or transfers or gives up possession of or seeks to sell, transfer or create, encumbrance on the Asset(s) in any manner whatsoever without the express consent in writing of the Company; or
The Borrower(s) fails to pay any insurance premium for the Asset(s); or violates terms of Insurance Policy or
The Asset(s) being confiscated, attached, taken into custody by any authority or is subjected to any execution proceeding or the Asset(s) is not traceable; or
The Borrower(s) failing to pay any tax, import duty or other imposition or to comply with any other formalities required to be completed in respect of the Asset(s) under law from time to time; or
The Asset(s) being stolen or is untraceable for any reason whatsoever; or
The Asset(s) is distrained, or damaged in any manner or rendered unfit for use or bodily injury is caused to the third party by accident with the Asset(s); or
Any of the PDCs or other instrument as provided for repayment of loan, delivered or to be delivered by the Borrower(s) to the Company in terms and conditions of the loan documents is not encashed for way reason whatsoever on presentation; or
Any instruction being given by the Borrower(s) for stop payment of any PDCs or other instrument as provided for repayment of loan, given to the Company or non-intimation of closure of bank account in respect of PDCs that the Borrower(s) has given to the Company; or the Borrower(s) failing to supply a copy of the registration certificate, invoice, Dealer's receipt, Insurance Policy of the Asset(s); or the Borrower(s) failing to get the endorsement/ lien of the Company in the Registration Certificate and Insurance Policy: or
Any circumstance exists or arises which gives reasonable grounds in the opinion of the Company that it is likely to prejudice or endanger the Asset(s) or the interest of the Company; or
The Borrower(s) failure to draw down the entire Loan amount in given time period; or
The Borrower(s) failing to provide/file the particulars of the Asset(s) (both old and new Asset(s)) as provided in the loan documents; or
The Borrower(s) committing breach of any of the terms, covenants and conditions of loan documents or any information given or the representations made by the Borrower(s) to the Company under the loan documents or any other document submitted by the Borrower(s) being found to be inaccurate or misleading or incorrect; or
The Borrower(s) being declared insolvent, bankrupt or in the case of a Company any winding up or liquidation proceedings being filed against the Borrower(s); or
Any default being committed by the Borrower(s) in discharging its liabilities under any other agreement entered into between the Company and the Borrower(s); or the Borrower(s) fails to keep the Asset(s) insured for the total period of the loan agreement or until the entire liability of the Borrower(s) is duly discharged; or
The Borrower(s) fails to produce the Asset(s) for inspection or verification thereof or making valuation by the Company or its officers, auditors, technical experts, management consultants, valuers or any other person authorized for the purpose by the Company; or
If there is reasonable apprehension that the Borrower(s) is unable to pay the debts, or has admitted in writing, his inability to pay the debts as they matured; or
There are existing any circumstances which in the sole opinion of KFL jeopardize KFL's interest; or
If the Borrower(s) fails to intimate KFL in writing, any change in his/its, location or address (residential, permanent or office address) within 7 days of such change; or
If the Borrower(s) fails to create or perfect exclusive continuing charge by way of hypothecation in favour of the KFL over such underlying Asset(s) by filing Form CHG-1 with Registrar of Companies (ROC) within the timelines as prescribed in the Companies Act, 2013 and rules made thereunder. The Borrower(s) shall also confirm the creation of such charge to KFL and inform KFL for creation of such charge within thirty (30) days from the creation of charge or within ninety (90) days from the disbursal of the Loan, whichever is earlier.
If the Borrower(s) fails to create charge of Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) by way of mortgage in favour of the KFL over such underlying asset(s) by filing necessary forms unde the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (SARFAESI Act) within the timelines of thirty (30) days as prescribed in the SARFAESI Act, and rules made thereunder.

For LAP & MSME

The following events shall constitute Events of Default:

Payment of Dues: Default shall have occurred in payment of EMIs/PEMIIs and/or interest and/or in payment of any other amounts due and payable to KFL by the Due Date in terms of the Loan Document and/or in terms of any other agreements, documents that may be subsisting or that may be executed between the Borrower(s) and KFL hereafter.
Performance of Covenants: Default shall have occurred in the performance of any other covenants, conditions of Agreements on the part of the Borrower(s) and/or the Guarantor(s) under the loan Document or any other agreements between the Borrower(s), the Guarantor(s) and KFL in respect of the Loan and/or any other loans and such default shall have continued over a period of 30 days after notice thereof shall have been given to the Borrower(s) and/or the Guarantor(s) by KFL.
Supply of Misleading Information: Any information, representation or warranty or assurance given by the Borrower(s) in the Loan Document and the related documents to KFL for grant of Loan is found to be misleading or incorrect in any material respect or concealment of necessary or essential information by the Borrower(s) based on which KFL has been prompted to act and enter into the Loan Agreement.
Depreciation of Security: If any asset on which the security for the Loan is created, depreciates in value to such an extent that in the opinion of KFL, an Additional Security to the satisfaction of KFL should be given and that such security is not given, despite being called upon to do so.
Sale/Disposal/Charge: If a Security or any part thereof is let out, given on leave and license, without prior written approval of KFL or sold, disposed of, charged, encumbered or alienated.
Attachment of Distress on Security: If an attachment or distress is levied on Security or any part thereof and/or certificate proceedings are commenced for recovery of any dues from the Borrower(s).
Failure to furnish information/documents: It the Borrower(s) fails to furnish information/ documents as and when required by KFL in terms of the Loan Document.
Failure to furnish End Use of Funds Letter: It the Borrower(s) fails to furnish the detailed End Use of Funds letter for the Loan to KFL within 10 (ten) days of receiving such request from KFL or within the period provided by KFL to the Borrower(s), as the case may be.
Security interest becoming unenforceable: If any Security interest or guarantee provided under the Loan Document becomes unenforceable or infructuous or is challenged by the Borrower(s) or any other person.
Dishonor of any payment instructions provided under the Loan Document, or any instructions given by the Borrower(s) for stopping payment of any mode under the Loan Document or instructions to KFL not to present any cheque(s)/ECS/ACH mandate.
The death, failure in business, general assignment for the benefit of creditors or winding up by or against the Borrower(s).
KFL for any regulatory or other reasons, is unable or unwilling to continue the Loan.
Inability to pay debts / insolvency / recall of Loans: -

If there is reasonable apprehension that the Borrower(s) is unable to pay his/their debts or has admitted in writing his/their inability to pay his/their debts as and when these mature or any recovery proceedings or any insolvency proceedings have commenced/instituted against the Borrower(s).
Bankruptcy or Insolvency: It the Borrower(s) commits an act of insolvency, if the Borrower(s) is/are declared insolvent or bankrupt or if a liquidator, recover or official assignee is appointed in respect of any Security or estate of the Borrower(s) or if the Borrower(s) makes any application for declaring himself/itself/themselves an insolvent or if an application for declaring the Borrower(s) as insolvent or bankrupt is made or any order is passed by any competent authority for taking the Borrower(s) into insolvency.
If any other financial institution(s)/bank(s) or non-banking financial companies with whom the Borrower(s) has entered into agreement(s) for financial assistance have refused to disburse loan(s) or any part thereof or have recalled its/their loan(s) under their respective loan agreement(s).
The Borrower(s) agrees and acknowledges that the occurrence of any default by the Borrower(s) under any agreement entered into by the Borrower(s) with any other bank and/or financial institutions including KFL shall constitute an Events of Default under theLoan Document and vice versa.
Where the Borrower(s) is a partnership firm, and if it is dissolved or a notice of dissolution is given to it or any of its partners or if the Borrower(s) or any of its partners commits an act of insolvency or makes an application for being declared insolvent or any order is passed declaring it or them or any of them an insolvent where the Borrower(s) is a company, if the Borrower(s) is unable to pay its financial debts within the meaning of Insolvency and Bankruptcy Code, 2016 a resolution for initiating corporate insolvency process is passed or any petition for its corporate insolvency is filed or any order for corporate insolvency is made against the Borrower(s) or it a liquidator in respect of any property or estate of the Borrower(s).

If the Borrower(s) fails to sign and deliver to KFL, the balance confirmation of the Loan as and when so required by KFL in the absence of any manifest error in calculation of such statement pointed out by the Borrower(s) within the timelines after receiving the balance confirmation statement from KFL.
Change in constitution: Any change in the constitution of the partnership firm with regard to the partners and their shares in profit and loss at the time of grant of the Loan and any changes in the names and shares made subsequently without the prior approval of KFL. Similarly, in the case of company, any change in the management control by the resignation of some directors and the induction of other directors and/or any change in the share holding pattern of the subscribers without the prior approval of KFL.
Cessation of Business: The Borrower(s) cease or threaten to cease to carry on the business it carries as on the date hereof;
Repudiation: The Borrower(s) repudiates the Loan Agreement or do or cause to be done any act or thing evidencing an intention to repudiate the Loan Agreement and/or any other document in relation to the Loan Agreement;
Non-payment of decretal amount: The Borrower(s) fails to pay amount under any Court order or decree or judgment against the Borrower(s);
Material Adverse Change: There occurs any event, incident or situation, including but not limited to any material adverse change as determined solely by KFL in the business or financial or other condition or operations or prospects of the Borrower(s) in which the Borrower(s) have invested, including any legal or other action taken by any creditor against the Borrower(s), which in the sole opinion of KFL is prejudicial to the interests of KFL or in the sole opinion of KFL is likely to materially affect the financial condition of the Borrower(s) and/or the Guarantor(s) and/or their ability to perform all or any of its obligations under the Loan Document and/or otherwise in respect of the Facility and to comply with any of the terms of the Loan Document and/or for the Loan (“Material Adverse Change”). Such information shall reach KFL within ten (10) days of any such event;
If any regulatory proceedings of whatsoever nature are initiated or likely to be initiated, at the sole discretion of KFL, against the Borrower(s);
It is or becomes unlawful for the Borrower(s) and/or the Guarantor(s) to perform all or any of its respective obligations, as determined by KFL under the Loan Documents and Security Documents, and such unlawfulness is not remedied within fifteen (15) Business Days after written notice of such unlawfulness shall have been given to the Borrower(s) and/or the Guarantor(s) by KFL (except in any case where the unlawfulness is incapable of remedy, when no such notice as is mentioned herein will be required);
If KFL is of the opinion that the Borrowers’ liabilities exceed the Borrower(s) assets or that the Borrower(s) is/are carrying on business at a loss;
If the Security furnished by the Borrower(s) is subsequently found to be of inferior value to that as declared by the Borrower(s) to KFL and/or the Security becomes infructuous;
The Borrower(s) acts or desists from acting and such act or desistance jeopardizes the powers vested in KFL under the Loan Agreement or any power(s) of attorney from being exercised solely by KFL (acting through its authorized representatives/or officers);
In cases where any dispute or legal proceeding is initiated/pending between Borrower(s) inter se and/or Guarantor(s) inter se and/or between Borrower(s) and the Guarantor(s);
The Security has been used or alleged to have been used for any illegal purpose or activity;
If any consent, authorization, approval or license of or registration with or declaration to any Government Authority required by the Borrower(s) in connection with the execution, delivery, validity, enforceability or admissibility in evidence of the Loan Agreement or the performance by the Borrower(s) of its obligations hereunder is modified in a manner unacceptable to KFL or is not granted or revoked or terminated or expires and is not renewed or otherwise ceases to be in full force and effect;
any other event of default as may deem fit by KFL.

Consequences of Event of Default:

For all products except LAP & MSME
1. The occurrence of any of the aforesaid Events of Default shall entitle the Company to demand and receive from the Borrower(s) the entire sum of money and all other sums and charges of whatsoever nature (including) but not limited to, interest on account of other taxes which would have been payable by the Borrower(s) if the Agreement had run to its full term have become due and payable forthwith. The Company shall be entitled to charge an extra percentage at a rate specified in Schedule of Charges against foreclosure /pre-closure charges on the Dues, and demand that all the aforesaid amounts be repaid to KFL immediately. KFL may by a notice in writing at its discretion, call upon the Borrower(s) to rectify the Event of Default within the period specified in such notice.
2. Upon occurrence of an Event of Default, the Borrower(s) shall be bound to deliver the Asset(s) to KFL at such location, as KFL may designate, in the same condition in which, it was originally delivered to the Borrower(s), including all attachment/additions, etc., made by the Borrower(s) subsequently, however ordinary wear and tear excepted. In case of any failure on the part of the Borrower(s) in this regard, and in any event upon the occurrence of an Event of Default, KFL shall be entitled to take possession of the Asset(s) and the Borrower(s) shall not prevent or obstruct KFL from taking the possession of the Asset(s). For this purpose, KFL's authorized representatives, servants, officers and agents shall have unrestricted right of entry with or without police assistance and shall be entitled to forthwith or at any time without notice to the Borrower(s), to enter upon the premises or garage, or go down, where the Asset(s) shall be lying or kept, and to take possession and to recover and receive the same and if necessary to break open any such place. KFL will be well within its rights to use tow van or any carrier to carry the Asset(s). The Borrower(s) shall be liable to pay any tow charges and other such expenses incurred by KFL for taking the possession of the Asset(s) and for its sale etc. If KFL takes possession of the Asset(s), KFL shall not be responsible notwithstanding anything to the contrary contained in Section 151 of the Indian Contract Act, for any loss or deterioration of or damage to the Asset(s) whether by theft, fire, rain, flood, earthquake, lightning, accident or any other cause whatsoever.
3. Upon the occurrence of an Event of Default, KFL shall issue notice of repossession to the Borrower(s), giving the Borrower(s) 5 days from the date of the notice to pay the Dues, else KFL shall exercise its right to repossess the Asset(s). KFL reserves the right to waive off the notice of repossession in case either the Borrower(s) has neglected to adhere to his covenants and undertakings as laid down in the loan document or has committed an Event of Default as specified above. The Borrower(s) shall however be given a final chance of seven (7) days from the date of such surrender/repossession to clear the Dues, post which KFL shall exercise its inherent right to auction the Asset(s).
4. KFL shall, in any occurrence of the aforesaid Events of Default, be entitled to and the Borrower(s) hereby irrevocably authorizes KFL to sell/transfer/ assign the Asset(s) either by public auction or by private treaty or otherwise howsoever and appropriate the proceeds thereof towards repayment of all the Dues by the Borrower(s) to KFL under the loan document. If the sale proceeds are not sufficient to meet all the Dues of KFL, the Borrower(s) shall be liable to pay for any deficiencies after the said appropriation. In case there is any surplus after adjusting the Dues of KFL, the same shall be paid to the Borrower(s). Nothing contained herein shall oblige KFL to sell the Asset(s) and KFL shall be entitled to proceed against the Borrower(s) or Guarantor(s), if any independently of such security. The Borrower(s) shall not be entitled to raise any objections regarding the regularity of the sale and/ or actions taken by KFL nor shall KFL be liable/ responsible for any loss that may be occasioned from the exercise of such power and/or may arise from any act or default on the part of any broker or auctioneer or other person or body engaged by KFL for the said purposes.
5. KFL shall be entitled to recover from the Borrower(s) all expenses (including legal costs on full indemnity basis) incurred by or on behalf of KFL in ascertaining the whereabouts of the Asset(s), taking possession, garaging, insuring, transporting and selling the Asset(s) and of any legal proceeding that may be filed by or on behalf of KFL to enforce the provisions of the loan document.
6. It is expressly clarified that the remedies referred to in the loan document shall be in addition to and without prejudice to any other remedy available to KFL under any agreement, or in law or equity.
7. Notwithstanding anything contained in the loan document, KFL shall be entitled to take possession of the Asset(s), whether the entire Loan amount has been recalled or not, whenever, in the absolute discretion of KFL, there is likelihood of the dues of KFL not being paid by the Borrower(s) and/ or the Asset(s) is likely to be transferred by the Borrower(s) to defeat KFL's Security over the Asset(s) or payment of the Dues of KFL.
8. As stated above, the Borrower(s) shall give delivery of the Asset(s) to KFL, its nominees or agents (as the case may be) or in the case of taking possession of the Asset(s) by KFL, the Borrower(s) shall transfer, deliver and endorse all registration, policies, certificates and other documents relating to the Asset(s) to KFL, its nominees or the agents (as the case maybe).
9. KFL or its officers, agents or nominees shall not be in any way responsible for any loss, damage, limitation or depreciation that the Asset(s) may suffer or sustain on any account of whatsoever whilst the same in the possession of KFL or its officers, agents or nominees or because of exercise or non-exercise of the rights, powers, or remedies available to KFL or its officers, agents or nominees and all such loss, damage or depreciation shall be debited to the account of Borrower(s) howsoever the same may have been caused.
10. Neither KFL nor its agents, officers or nominees shall be in any way responsible and liable for, and the Borrower(s) hereby agrees not to make KFL or its officers, agents or any nominees liable for any loss, damage, depreciation or destruction or otherwise for any belongings and articles that may be kept or lying in the Asset(s) at the time of taking charge and/ or possession, or seizure of the Asset(s).
11. The Borrower(s) do hereby fully agree and confirm that in case KFL sells the Asset(s) it has taken possession of and if there is deficiency and if liability of the Borrower(s) still exists even after appropriating the net sale proceeds towards the Dues payable by the Borrower(s), KFL shall be fully eligible and entitled to demand payment thereof and for such purposes shall have the right to present the PDCs/ Cheques including Security Cheques if any, available with KFL towards such deficiency and liability of the Borrower(s) without any notice or intimation to the Borrower(s). The Borrower(s) further confirms that Borrower(s) shall ensure that the said PDCs/ Cheques are honoured and thereby discharge his/ their said liabilities. Notwithstanding the right to present the PDCs/ Cheques in this regard and without prejudice to such right, KFL shall be entitled to invoke or take recourse to any other remedy available in law.
12. KFL reserves the right to refuse handing over the possession of the repossessed Asset(s) to the Borrower(s) in case KFL has the apprehension that upon the handing over of possession of the repossessed Asset(s) to the Borrower(s), the Asset(s) shall either be alienated, disposed off or the original physical condition of the Asset(s) would be changed. In such instances, the Borrower(s) shall be required to foreclose the Loan to get possession of the repossessed Asset(s).
13. A certificate in writing signed by an authorized officer of KFL stating the amount at any particular time due shall be conclusive evidence that such amount is in fact due and payable by the Borrower(s).
14. Upon occurrence of any of the Events of Default or termination of the Agreement in any manner, the Borrower(s) shall forthwith deliver to KFL all original certificates and policies of the insurance including certificate of registration, keys and all other documents relating to the Asset(s). In the event of failure of the Borrower(s) to do so, KFL shall be entitled to apply to the concerned authorities and obtain the document afresh, at the cost and expense of the Borrower(s), which shall be charged to the account of the Borrower(s). The Borrower(s) hereby specifically authorizes KFL and agrees/undertakes that no objection will be raised, or restraint will be made, directly or indirectly or through court, before any authority or any other person, for any such application is to be made by KFL for obtaining registration certificate, duplicate keys or such other documents in relation to the Asset(s).
15. It shall be the sole responsibility of the Borrower(s) to remove any goods, valuables, things, etc. kept or available in the Asset(s) during or while the Asset(s) is surrendered/seized by KFL, either directly or through agencies or such persons authorized by the court of law and the Borrower(s) shall make his own arrangements to remove or transfer such things or goods from the Asset(s) at his own cost and expense and KFL shall not be liable in any manner whatsoever to the Borrower(s) for any loss, damage, depreciation, theft, pilferage, etc. to such things or goods, during transit or otherwise, or for any claim or damages arising in this regard, during or after surrender/ seizure.
16. KFL shall have absolute discretion to apply the net proceeds of sale, realization and recovery and/or insurance claim proceeds relations to the Asset(s) herein and the Borrower(s) shall in the manner and priorities it thinks fit.
17. KFL shall have absolute discretion to utilize the FLDG/DSRA/Security Deposit towards any Dues under the Loan(s) of the Borrower(s).
18. KFL shall have the absolute discretion to mark lien and withhold the NOC of any/all loan accounts of the Borrower(s) and/or Guarantor(s) in case of an Event of Default in any one loan account held by the Borrower(s) and/or Guarantor(s), even if the repayment in the other loan accounts is proper or the other loan account is pre-closed.

For LAP & MSME

On the question whether any of the above Event of Default has occurred, the decision of KFL shall be final, conclusive and binding on the Borrower(s) and/or the Guarantor(s). If KFL decides that there is an Event of Default, the Borrower(s) shall sign and execute a declaration confirming that the Event of Default has occurred, in the form provided by KFL.
Without prejudice to any other provisions of the Loan Agreement the Borrower(s) hereby confirms, acknowledge that any default by the Borrower(s) under any loan agreement or arrangement with KFL or its subsidiaries, associates/affiliates or any other financial institution/bank/person shall constitute Event of Default under the Loan Agreement.
Notice to KFL on the happening of an Events of Default:

If any Event of Default or any event which, after the notice or lapse of time or both would constitute an Event of Default shall have occurred under the Loan Agreement, it shall be the obligation of the Borrower(s) to forthwith notify; give KFL notice thereof in writing specifying such Event of Default and thereupon the entire Dues shall become payable forthwith and KFL shall be entitled to enforce the Security Interest and recover the Dues under the Loan Agreement.
In the event that the Borrower(s) fails to pay, when due, any Dues to KFL, KFL shall commence legal proceedings to recover such sums, the Borrower(s) agrees in relation to the same and in addition to the Dues to pay KFL all advances, charges, costs and expenses including reasonable legal fees, incurred or paid by KFL in exercising any right, power or remedy conferred by the Loan Agreement (or in the enforcement thereof) and all such sums shall become a part of the outstanding Dues hereunder and shall be paid to KFL by the Borrower(s) immediately and without delay and demur.

Notwithstanding the provisions contained in Clause 7.4, if one or more of the events specified in “Events of Default” shall have happened, then, KFL, by a written notice to the Borrower(s) may declare that the Dues including but not limited to Loan, all accrued interest and all other amounts payable by the Borrower(s), in terms of the Loan Agreement and/or any other agreement(s) document(s) subsisting between the Borrower(s) and KFL, shall become due and payable and upon such declaration the same shall become due and payable forthwith and the Security Interest created in favour of KFL for the Loan shall become enforceable.
Upon the occurrence of any one or more of the “Events of Default”, KFL through its officers, against attorneys, nominees etc. shall have the right (without prejudice to any other rights under the Loan Agreement) to take anyone or more than one of the following actions without specific intervention of the Court or any Court order:

To enforce all or any of the Security Interest provided/furnished by the Borrower(s) as Security Interest for the payment of the Dues under the Loan Agreement or deemed to be the Security Interest under the Loan Agreement.
KFL shall be entitled to sell/transfer/dispose off/assign the Security Interest, either by public auction, tender, private freaky or otherwise howsoever. The Borrower(s) shall, however, be liable for deficiencies, if any, and KFL shall be entitled to proceed against the Borrower(s) for such deficiency(ies) in case there is any outstanding Dues after adjusting the proceeds of the Security realized against the Dues of the Borrower(s), and the same shall be paid to the Borrower(s).
KFL shall have absolute discretion to utilize the DSRA/security deposit towards any dues under the loan(s) of the Borrower(s).
KFL shall have the absolute discretion to mark lien and withhold the NOC of any/all loan accounts of the Borrower(s) and/or Guarantor(s) in case of an Event of Default in any one loan account held by the Borrower(s) and/or Guarantor(s), even if the repayment in the other loan accounts is proper or the other loan account is pre-closed.
KFL shall be entitled to appoint nominee director at the board of the Borrower(s) company.

The Borrower(s) shall not be entitled to raise any objections regarding the manner and/or the regularity of sale, transfer etc. and/or auctions made by KFL, nor shall KFL be liable responsible for any loss that may be occasioned from the exercise of such power and/or may arise from any act or default on the part of any broker or auctioneer or other person or body engaged by KFL for the said purpose.
KFL shall be at liberty to recover the amounts due from the Borrower(s) in the aforesaid Events of Default by proceeding against the Borrower(s) without even attempting to take/possess/sell etc. the Security interests provided by the Borrower(s).
It is hereby clarified that the remedies referred to above shall be in addition to and without prejudice to any other remedy available to KFL either under the Loan Agreement, or under any other agreement, or in law.
Neither KFL nor its agents, officers or nominees shall in anyway be responsible or liable to the Borrower(s) for any loss, damage, depreciation, limitation that the Borrower(s)/the Security Interest may suffer on account of any of the aforesaid actions of KFL or on account of the exercise/non-exercise of the rights, powers or remedies available to KFL.
Expenses of preservation and collection: All costs incurred by KFL after an Events of Default has occurred in connection with:

The preservation of the Security including the Security.
The collection of amounts due under the Loan Agreement shall be charged to the Borrower(s) and reimbursed by the Borrower(s) as KFL shall specify.

Evidence of Debt: The records and accounts maintained by KFL in its ordinary course of business shall be prima facie proof for the due amounts under the Loan Agreement. A certified copy of the statement of account by an officer of KFL stating the amount due at any particular time shall be prima facie evidence against the Borrower(s) in respect of payments due.
Issue of No Dues Certificates: KFL may issue No Dues Certificate as regards payment of any amount paid by the Borrower(s) to KFL in terms of the Loan Agreement only if the Borrower(s) has paid all amounts due under the Agreement to KFL and the Borrower(s) has complied with all the terms of the Loan Agreement.
Communication with third party, etc.: In the Event of default, KFL shall be entitled to communicate, in any manner it may deem fit, or with any person or persons with a view to receiving assistance of such persons in recovering the Defaulted Amounts. The representatives of KFL shall be entitled to visit any place of work of the Borrower(s).

On the occurrence of Event of Default, KFL shall be entitled to communicate, in any manner it may deem fit, or with any person or persons with a view to receiving assistance of such persons in recovering the Defaulted Amounts. The representatives of KFL shall be entitled to visit any place of work of the Borrower(s).

Disclosure of names to appropriate authorities: Borrower(s) hereby agrees as a pre-condition of the Loan given to the Borrower(s) by KFL that in case Borrower(s) commits default in the repayment of the Loan or in repayment of interest thereon or any of the agreed installment of the Loan on Due Date, KFL shall have an unqualified right to disclose or publish the name of Borrower(s), Guarantor(s), as the case may be, as defaulters, in such manner and through such medium as KFL in its absolute discretion may think fit.
KFL shall recognize incipient stress in loan accounts, immediately on default, by classifying such assets as special mention accounts (SMA) and Non-Performing Assets (NPA) wherein the principal or interest payment or any other amount wholly or partly is overdue. as per the following categories:

1-30 days as SMA - 0

31-60 days as SMA-1

61-90 days as SMA-2

90th days as NPA

Example explaining the entire process, (the date(s) mentioned above are for illustration purpose only): If due date of a loan account of the borrower is 5th March, 2021 and full dues are not received on this date, the date of overdue shall be end of the day on 5^th March, 2021 and the loan account shall be classified as SMA–0. If the loan account continues to remain overdue on 4^th April, 2021 i.e. upon completion of 30 days of being continuously overdue, then this account shall be classified as SMA-1 on 4^th April, 2021. If the loan account continues to remain overdue upon running day-end process on 4^th May, 2021 i.e. upon completion of 60 days of being continuously overdue, it shall be classified as SMA-2 on 4^th May, 2021. If the loan account continues to remain overdue upon running day end process on 3^rd June, 2021 i.e. upon completion of 90 days of being continuously overdue, it shall be classified as NPA on 3^rd June, 2021. Notwithstanding anything stated elsewhere in the Agreement, special mention accounts (SMA) and non-performing assets (NPA) reporting is done at Borrower(s) level as per the regulatory guidelines and thus, overdue in any one account of the Borrower(s) will result in reporting of the Borrower(s) as SMA or NPA as the case may be.

The above-mentioned terms and conditions can be amended on the sole discretion of the Company and intimated to the Borrower. The Borrower agrees to be bound by the amended terms and conditions.

Most important Terms and Conditions (“MITC”)

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