(THE COMPANIES ACT, 1956) (COMPANY LIMITED BY SHARES) ARTICLES OF ASSOCIATION OF KANTI BIJLEE UTPADAN NIGAM LIMITED*

Transcription

1 (THE COMPANIES ACT, 1956) (COMPANY LIMITED BY SHARES) ARTICLES OF ASSOCIATION OF KANTI BIJLEE UTPADAN NIGAM LIMITED* The marginal notes hereto are inserted for convenience only and shall not affect the meaning or interpretation hereof, unless there be something in the subject inconsistent therewith. DEFINITIONS In these Articles, the following expressions shall, unless repugnant to the context or meaning thereof, have the meaning hereinafter assigned to them: 1.1. "Act" shall mean the Companies Act, l956, or any statutory modifications or re-enactment thereof for the time being in force Affiliates / Associate in relation to BSEB and NTPC respectively shall mean person(s)/ body corporate of which BSEB and NTPC, as the case may be, is owner or beneficial owner These Articles means the Article of Association of the Company for the time being in force Beneficial Owner means the beneficial owner as defined in clause (a) of sub-section (1) of Section 2 of the Depositories Act,1996; Act Affiliates/ Associates Articles Beneficial owner * Name Changed vide Special Resolution in EGM dated

2 1.5. Board or Board of Directors means the Board of Directors of the Company BSEB Shall mean Bihar State Electricity Board, a body corporate incorporated under the Electricity Act1948 (Central Act 54 of 1948) having head office at Vidyut Bhavan, Bailey Road, Patna and includes its successor(s), administrator(s) and permitted asigns Capital means the capital for the time being raised or authorised to be raised for the purpose of the company "The Chairman means the Chairman of the Board of Directors of the Company for the time being The Company or JVC shall means Kanti Bijlee Utpadan Nigam Limited* Dematerialisation is the process by which shareholder/debenture holder can get physical share/debenture certificates converted into electronic balances in his account maintained with the participant of a Depository Depositories Act means Depositories Act,1996 or any statutory modification or reenactment thereof Depository means a company formed and registered under the Companies Act,1956 and which has been granted a certificate of registration to act as a depository under the Securities & Exchange Board of India Act,1992; Directors mean the Directors for the time being of the company and include any person occupying the position of Director by whatever name called Dividend includes any interim dividend and bonus. Board BSEB Capital Chairman Company Dematerialisation Depositories Act Depository Director(s) Dividend * Name Changed vide Special Resolution in EGM dated

3 1.15. Executor or Administrator means a person who has obtained probate or letter of administration, as the case may be, from the Competent Court Managing Director or MD means the Managing Director of the Company appointed in accordance with these Articles Member means any person whose name appears as such in the Register of the Members of the Company and includes the subscribers to the Memorandum of Association of the Company Month means Calendar Month NTPC shall mean NTPC Limited incorporated under the provisions of the Act, having its registered office at NTPC Bhawan, Scope Complex, 7, Institutional Area, Lodi Road, New Delhi The Office means the Registered office of the company for the time being Persons shall include any individual, company or association or body of individuals whether incorporated or not Promoter shareholders shall mean BSEB and NTPC Proxy means an instrument whereby any person is authorised to vote for a member at a General Meeting or poll The Register means the Register of Members of the company required to be kept pursuant to the provisions of the Act Registered Owner means a Depository whose name is entered as such in the records of the Company "Regulation of the Company means the regulation for the time being in force for the management of the company. Executor/Administrator Managing Director Member Month NTPC Office Persons Promoter Shareholder Proxy Register Registered Owner Regulation 3

4 1.27. Rematerialization is the process of conversion of electronic holdings back into the physical form and issue of fresh share/debenture certificate(s) in favour of share/debenture holder(s) R&M shall mean the renovation, modernisation, refurbishment, rehabilitation, modification, design audit, operating system audit, reverse engineering component damage assessment, residual life assessment, re engineering, R&M related operations, maintenance of thermal/ hydro power stations, switchyard, substations, transmission lines etc. Of utility and industrial power stations including Boilers, turbines and related auxiliaries and systems "Seal means the common seal of the company for the time being SEBI means the Securities & Exchange Board of India; The Secretary means the Secretary for the time being of the company appointed by the Board in accordance with the provisions of the Act Security means Shares in or Debenture of the Company and such other securities as may be specified by SEBI from time to time Shares means the Shares or stock into which the capital of the Company is divided and the interest corresponding with such Shares or stock Transfer means an instrument of transfer duly stamped and otherwise valid and does not include any instrument of transfer which the company is for any reason entitled to refuse to Register and does not Register Year means the Calendar year and Financial Year and shall have the meaning assigned thereto by Section 2(17) of the Act Singular Number words importing the singular number shall include, where the context permits, the plural number and vice-versa. Rematerialization R&M Seal SEBI Secretary Security Shares Transfer Year Singular Number By the same token, words importing the masculine gender shall include, where the context permits, the 4

5 feminine gender and vice-versa Written or In writing shall include printing, lithographing and other modes of representing or reproducing words in a visible form Other words or expressions contained in these Articles shall bear the same meaning as are assigned to them in the Act or any statutory modification thereof. Written/in writing Other words/ Expressions I II CONSTITUTION The regulations in Table A in the First Schedule to the Act shall not apply to the Company, except so far as the same are repeated or contained in or expressly made applicable by these Articles or by the Act. The regulations for the management of the company and for the observance of the members thereof and their representatives shall, subject as aforesaid and to any exercise of the statutory powers of the company in reference to the repeal or alteration of or addition to its Articles of Association by Special Resolution, as prescribed or permitted by the Act, be such as are contained in these Articles. Application of regulation in Table A Company to be governed by these Articles III The Company is a Public Company within the meaning of Section 3(1)(iv) of the Companies Act, and accordingly shall have a minimum paid-up Capital of Rs. 5,00,000 (Rupees Five Lakh) or such higher paid-up Capital as may be prescribed by the Act. SHARE CAPITAL Company to be a Public Company 1. The Authorized Share Capital of the Company shall be the amount as provided under clause V of the Memorandum of Associations. NTPC shall subscribe 51 % to 74 % shares in the Company. Balance Shall be subscribed by BSEB 2. The company may buy back its own shares subject to provisions of the sections 77A, 77AA and 77B of the Act as amended. 3. Save as permitted by Section 77 of the Act, the funds of the company shall not be employed in the purchase of, or lent on security, the shares of the company and the company shall not give directly or indirectly, any financial assistance, whether by way of loan, guarantee, the provisions of security or otherwise, for the purpose of, or in connection with any purchase of or Share Capital Buy back of shares Financial assistance to subscribe to shares 5

6 subscription for Shares in the company. 4. Subject to the provisions of Section 80 of the Act the Company shall have power to issue Preference Shares carrying a right of redemption or liable to be redeemed at the options of the company and the Directors, may subject to the provisions of the Act and of these presents, exercise such power in any manner prescribed by the resolution authorising the issue of such shares. 5. Subject to the provisions of the Act and these Articles the shares shall be under the control of the Board who may allot or otherwise dispose of the same to such persons, on such terms and conditions at such times, either at par or at a premium, and for such consideration as the Board thinks fit. Redeemable Preference Share Allotment.of Shares Provided that where at any time it is proposed to increase the subscribed capital of the Company by the allotment of further shares, then, the Board shall issue such shares in the manner set out in Section 81 (1) of the Act, save and except that the Board may determine whether or not any offer of shares made in such manner shall include a right exercisable by any person concerned to renounce all or any of the shares offered to him in favour of any other person. 6. Subject to the provisions of the Act and these Articles, the Board may allot and issue shares in the capital of the Company as payment or part payment for any property (including payment made for an acquisition of land and other properties, business) sold or transferred, goods or machinery supplied or for services rendered to the Company in or about the formation or promotion of the Company or the conduct of its business and any shares which may be so allotted may be issued as fully paid up or partly paid up otherwise than in cash, and if so issued, shall be deemed to be fully paid up or partly paid up shares as aforesaid. 7. An application signed by or on behalf of an applicant for shares in the Company, followed by an allotment of any shares therein, shall be an acceptance of shares within the meaning of these articles; and every person who thus or otherwise accepts any shares and whose name is on the Register shall, for the purpose of these Articles, be a member. 8. The money (if any) which the Board, on the allotment of any shares being made by them, require or direct to be paid by way of deposit, call or otherwise, in respect of any shares allotted by them, shall, immediately on the insertion of the name of the allottee in the Register of Members as the name of the holder of such shares, become a debt due to and recoverable by the Company, from the allotted thereof and, shall be paid by him accordingly. Board may allot and issue Shares Acceptance of Shares Money due on allotment 6

7 9. If by the conditions of allotment of any share the whole or part of the amount or issue price thereof shall be payable by installment, every such installment shall, when due, be paid to the Company by the person who, for the time being and from time to time, shall be the registered holder of the share or his legal representative. Payment Installments in 10. The Company may on the issue of more than one class of shares differentiate between the holders of shares of different classes as to the amount of calls to be paid and the times of payment. Where any calls for further share capital are made on shares, such calls be made on a uniform basis on all shares falling under the same class. 11. The Company shall cause to be kept at its Registered Office or at such other place as may be decided by the Board of Directors, the Register and Index of Members/Debenture Holders in accordance with section 150 and 151 and other applicable provisions of the Companies Act, 1956 and the Depositories Act, 1996 with the details of Shares/Debentures held in physical and dematerialised form in any medium as may be permitted by law including in any form of electronic medium. Issue of more then one class of shares Register and Index of Members The Register and Index of Beneficial Owner maintained by a Depository under section 11 of the Depositories Act,1996 shall also deemed to be the Register and Index of Memebers/Debentureholders for the purpose of the Companies Act,1956 and any amendment or re-enactment thereof. The Company shall have power to keep in any State or Country outside India, a Register of Members/Debenture holders for the resident in that State or Country. 12. The Register and the Index of Members shall be open to inspection of members without any payment and to inspection of any other persons on payment of Rupee Ten or such lesser sum as the Company may prescribe for each inspection. Any such member or person may take extracts therefrom 13. The Company shall send to any member on request extracts/copy of the Register or of the list and summary required under the Act on payment of such sum as specified in the Act from time to time. Register and Index of members open to inspection Extracts of the Register DEMATERILISATION OF SECURITIES 14. a) Notwithstanding anything contained in these Articles, the Company shall be entitled to dematerialize or rematerialize its shares, debentures and other securities(both present and future) held by it with the Depository and to offer its shares, debentures and other securities for subscription in a Company may Dematerialize or Rematerialize its Securities 7

8 dematerialized form pursuant to the Depositories Act, 1996 and the Rules framed thereunder, if any; b) Every person subscribing to securities offered by the Company shall have the option to receive the security certificates or to hold the securities with a Depository. Such a person who is the beneficial owner of securities can at any time opt out of a Depository, if permitted by law, in respect of any security and the Company shall, in the manner and within the time prescribed provided by the Depositories Act, 1996 issue to the beneficial owner the required Certificates of Securities. Option for Investors If a person opts to hold his security with a depository, then notwithstanding anything to the contrary contained in the Act or in these Articles, the Company shall intimate such Depository the details of allotment of the security and on receipt of the information, the Depository shall enter in its record the name of the allottee as the beneficial owner of the security. c) All securities held by a Depository shall be dematerialized and shall be in fungible form. Nothing contained in Sections 153 of the Act shall apply to a Depository in respect of securities held by it on behalf of the beneficial owners. Securities in Depositories to be in fungible form (d) (i) Notwithstanding anything to the contrary contained in the Act or in these Articles, a Depository shall be deemed to be the registered owner for the purposes of effecting transfer of ownership of security on behalf of the beneficial owner; Rights of Depositories and beneficial owners (ii) Save as otherwise provided in (i) above, the Depository as the registered owner of the securities shall not have any voting rights or any other rights in respect of the securities held by it;. (iii) Every person holding securities of the company and whose name is entered as the beneficial owner in the records of the Depository shall be deemed to be a member/debenture holder, as the case may be, of the Company. The beneficial owner of securities shall be entitled to all the rights and benefits and be subject to all the liabilities in respect of his securities which are held by a Depository. (e) Notwithstanding anything to the contrary contained in the Act or in these Articles to the contrary, where securities are held in a Depository, the records of the beneficial ownership may be served by such Depository on the Company by means of electronic mode or by delivery of floppies or discs or such other modes as may be prescribed. (f) Nothing contained in the Act or in these Articles, shall apply to a transfer or transmission of Securities where the company Service of Documents Transfer/ Transmission of 8

9 has not issued any certificates and where such Shares or Debentures or Securities are being held in a electronic and fungible form in a Depository. In such cases the provisions of the Depositories Act, 1996 as amended from time to time shall apply. Securities held in Demat form (g) Notwithstanding anything to the contrary contained in the Act or these Articles, after any issue where the securities are dealt with by a Depository, the company shall intimate the details thereof to the depository immediately on allotment of such securities. (h) Nothing contained in the Act or in these Articles regarding the necessity of having distinctive numbers for securities issued by the Company shall apply to securities held by a Depository. Allotment of Securities Dealt with in a Depository Distinctive number of Securities held in Depository CERTIFICATES 15. Every person whose name is entered as a member or debenture holder in the Register of members or Register of Debenture holders shall without payment, be entitled to a Certificate under the common seal of the Company specifying share(s) or debenture(s) held by him and the amount paid thereon. Share/Debenture Certificates shall be issued on application in marketable lots and where shares/debenture certificates are issued for either more or less than the marketable lots sub-division or consolidation into marketable lots shall be done free of charge within one month from the date of lodgment thereof. Any two or more allottees of a share/debenture shall for the purpose of this Article be treated as a Single Member and the share/debenture Certificate which may be subject to joint ownership may be delivered to any one of such joint owners on behalf of all of them. Share Certificates Provided that in case of securities held by the member/bond/debenture holder in dematerialized form, no Share/ Bond/ Debenture Certificate(s) shall be issued. 16. If a Share/Debenture Certificate is defaced, lost or destroyed it may be renewed on payment of such fee, if any, and on such terms, if any as to evidence and indemnity as the Board may think fit. Issue of new certificate in lieu of defaced, lost or destroyed CALLS 17. The Board may from time to time make such calls as they think fit upon the members or debenture holders in respect of all moneys unpaid on the Shares/debentures held by them Call on Shares/ Debentures 9

10 respectively and not by the condition of allotment thereof made payable at fixed times and each member/debenture holder shall pay the amount of every call so made on him to the person and at the times and places appointed by the Board. A call may be made payable by instalments. Provided, however, that the Board may from time to time at the discretion extend the time fixed for the payment of any call. 18. If the sum payable in respect of any call be not paid on or before the day appointed for payment thereof the holder for the time being or allottee of the Share/debenture in respect of which a call shall have been made shall pay interest on the same at such rate as the Board shall fix, from the day appointed for the payment thereof to the time of actual payment, but the Board may waive payment of such interest wholly or in part. 19. The joint holder of a Share/debentures shall be jointly and severally liable to pay calls in respect thereof. 20. The Board may, if they think fit, receive from any member willing to advance the same, all or any part of the money due upon the Share held by him beyond the sums actually called for and upon the money so paid or satisfied in advance, or so much thereof as from time to time exceeds the amount of the calls then made upon the Share in respect of which such advance has been made, the company may pay interest at such rate not exceeding 4% or such other rate as may be approved by Central Government and the Board may at any time repay the amount so advanced upon giving to such member not less than three month s notice in writing. Provided that moneys paid in advance of calls or any shares may carry interest but shall not confer any right of voting, Dividend or participate in profits. 21. Any money due from the company to a Shareholder/ debenture holder may, without the consent of such Shareholder/debenture holder, be applied by the company in or towards payment of any money due from him to the company for calls or otherwise. 22. A call may be revoked or postponed at the discretion of the Board. When Interest on calls payable Joint-holders liability to pay Payment of calls in advance Application of money Of Share holders/ debenture holder Revocation of call LIEN 23. The Company shall have a first and paramount lien on every share or debentures (not being a fully paid share or debenture) for all moneys called or payable at a fixed time in respect of that share; but the Company shall have no general lien on such Company to have lien on shares 10

11 partly paid up shares. The Board may at any time declare any share to be wholly or in part exempt from the provisions of this Article. 24. For the purpose of enforcing such lien the Board may sell the shares/debentures subject thereto in such manner as it shall think fit, and for that purpose may cause to be issued a duplicate certificate in respect of such shares/debentures and may authorise one of its member to execute a transfer thereof on behalf of and in the name of such Member or debenture holders. No sale shall be made until such period as aforesaid shall have arrived, and until notice in writing of the intention to sell shall have been served on such Member/debenture holder or his representatives and default shall have been made by him or them in payment, fulfilment, or discharge of such debts, liabilities or engagements for fourteen days after such notice. 25. The net proceeds of any such sale shall be received by the Company and applied in or towards payment of such part of the amount in respect of which the lien exists as is presently payable and the residue, if any, shall (subject to a lien for sums not presently payable as existed upon the shares before the sale ) be paid to the person entitled to the shares at the date of the sale. As to enforcing lien by sale Application of proceeds of sale FORFEITURE OF SHARES/DEBENTURES 26. If any member/debenture holder fails to pay any call or instalment of a call on or before the day appointed for the payment of the same or any such extension thereof as aforesaid, the Board may at any time thereafter, during such time as the call or instalment remains unpaid, give notice to him to pay the same together with any interest that may have accrued and all expenses that may have been incurred by the company by reason of such non payment. 27. The notice shall name a day (not being less than fourteen days from the date of the notice) and a place or places on and at which such call or instalment and such interest thereon at such rate not exceeding 10 percent per annum as the Board shall determine from the day on which such call or instalment ought to have been paid and expenses as aforesaid are to be paid. The notice shall also state that, in the event of non payment of calls at or before the time and at the place appointed, the shares in respect of which the call was made or instalment is payable will be liable to be forfeited. If money payable on shares/ debentures not paid notice to be given to members Form of Notice 11

12 28. If the requirement of any such notice as aforesaid shall not be complied with, every or any share/debenture in respect of which such notice has been given may at any time thereafter before payment of all calls or instalments, interest and expenses due in respect thereof, be forfeited by a resolution of the Board. Such forfeiture shall include all dividends declared or any other moneys payable in respect of the forfeited share and not actually paid before the forfeiture. 29. When any share/debenture shall have been so forfeited, notice of the forfeiture shall be given to the member/ debenture holder in whose name it stood immediately prior to the forfeiture, and an entry of the forfeiture with the date thereof, shall forthwith be made in the Register, but no forfeiture shall be in any manner be invalidated by any omission or neglect to give such notice or to make any such entry as aforesaid. 30. Any share/debenture so forfeited shall be deemed to be the property of the company, and may be sold, re-allotted, or otherwise disposed of; either to the original holder thereof or to any other person upon such terms and in such manner as the Board shall think fit. 31. Any member/ debenture holder whose shares/debentures have been forfeited shall, notwithstanding the forfeiture, be liable to pay and shall forthwith pay to the company on demand all calls, instalments, interest and expenses owing upon or in respect of such shares or debentures at the time of the forfeiture, together with interest thereon from the time of forfeiture, until payment at such rate not exceeding 10 percent per annum as the Board may determine and the Board may enforce the payment thereof as it thinks fit. 32. The forfeiture of a share/debenture shall involve, extinction at the time of forfeiture, of all interest in and all claims and demands against the company, in respect of the share and all other rights incidental to the share except only such of those rights as by these articles are expressly saved. If default of payment share to be forfeited Notice of forfeiture to a member/ debenture holder Forfeited shares to be property of the company and may be sold etc. Member still liable to pay money at the time of forfeiture and interest Effect of forfeiture 33. A declaration in writing that the declarant is a Director or Secretary of the company and that a share/ debenture in the company has been duly forfeited in accordance with these articles on a date stated in the declaration shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the shares. Evidence forfeiture of 34. Upon any sale after forfeiture or for enforcing a lien in purported Validity of sale 12

13 exercise of the powers herein before given, the Board may appoint some person to execute an instrument of transfer of the shares/debenture sold and cause the purchaser s name to be entered in the Register in respect of the shares/debenture sold, and the purchaser shall not be bound to see to the regularity of the proceedings or to the application of the purchase money, and after his name has been entered in the Register in respect of such shares/ debenture, the validity of the sale shall not be impeached by any person and the remedy of any person aggrieved by the sale shall be in damages only and against the company exclusively. 35. Upon any sale, re-allotment or other disposal under the provisions of the preceding Articles, the certificate or certificates originally issued in respect of the relative share/ debenture shall (unless the same shall on demand by the company have been previously surrendered to it by the defaulting member) stand cancelled and become null and void and of no effect, and the Directors shall be entitled to issue a new certificate or certificates in respect of the said shares/ debenture to the person or persons entitled thereto. 36. The Board may at any time before any share/ debenture so forfeited shall have been sold, re-allotted or otherwise disposed of, annul the forfeiture thereof upon such conditions as it thinks fit. Cancellation of share certificate in respect of forfeited shares/ debenture Power to annul forfeiture TRANSFER AND TRANSMISSION OF SHARES AND DEBENTURES 37. The Company shall maintain a Register of Transfers and therein shall be fairly and distinctively entered the particulars of every transfer or transmission of any share/ debenture. 38. The provisions relating to transfer of shares shall apply mutatis mutandis to transfer of debentures/bonds. 39. The instrument of transfer shall be in writing and in such form as may be prescribed. All the provisions of Section 108 of the Act shall be duly complied with in respect of all transfers and of the registration thereof. The Company shall not charge any fee for registration of a transfer of shares or debentures/bonds. 40. The instrument of transfer duly stamped and executed by the transferor and the transferee shall be delivered to the company in accordance with the provisions of the Act. The instrument of transfer shall be accompanied by the Share Certificate or such Register of Transfers Transfer of Debentures Form of transfer Instrument of transfer to be completed presented to the company 13

14 evidence as the Board may require to prove the title of transferor and his right to transfer the shares and every registered instrument of transfer shall remain in the custody of the company until destroyed by order of the Board. Any instrument of transfer which the Directors may decline to register shall be returned to the person depositing the same. 41. NTPC and BSEB shall not transfer, sell/assign or otherwise encumber its Shareholding in the Company for an initial period of 5 years from the date of Commercial Operation of Muzaffarpur Thermal Power Station. 42. The transferor shall be deemed to be the holder of such shares until the name of the transferee have been entered in the Register of Members in respect thereof. Before the registration of a transfer, the certificate or certificates of the shares must be delivered to the Company along with Transfer Deed. 43. No transfer shall be made to a person of unsound mind or to an insolvent. 44. The Directors shall have power, on giving seven days, notice by advertisement as required by Section 154 of the Act, to close the transfer books, Register of Members or Register of Debenture holders of the company for such period of time not exceeding in the whole 45 days in each year (but not exceeding 30 days at a time) as they may determine. 45. In the event there is no nomination, the executors or administrators of a deceased member or the holder of a Succession Certificate in respect of the shares of a deceased member (not being one of two or more joint holders) shall be the only persons whom the Company will be bound to recognise as having any title to the shares registered in the name of such member, and the Company shall not be bound to recognise such executors or administrators or holders unless such executors, administrators or holders shall have first obtained probate or Letters of Administration or Succession Certificate as the case may be, from a competent Court in India. Transferor deemed to be holder No transfer to insolvent etc. Closure of Register of Members or Debenture holders Title to shares of deceased holder Provided that the Board may at their absolute discretion dispense with production of Probate, Letters of Administration or Succession Certificate upon such terms as to indemnity or otherwise as they think fit and may enter the name of the person who claims to be absolutely entitled to the shares standing in the name of a deceased member, as a member. 46. Any person becoming entitled to any share in consequence of Transmission 14

15 the death, lunacy or insolvency of any member or by any lawful means other than by a transfer in accordance with these Articles, may, with the consent of the Board (which they shall be under no obligation to give) and upon producing such evidence that he sustains the character in respect of which he proposes to act under this Article or of his title as the Board may require and upon such indemnity as the Board may require, either be registered as a member in respect of such shares or elect to have some person nominated by him and approved by the Board registered as a member in respect of such shares PROVIDED that if such persons shall elect to have his nominee registered, he shall testify his election by executing in favour of his nominee an instrument of transfer in accordance with these Articles, and until he does so he shall not be freed from any liability in respect of such shares. clause UNDERWRITING AND BROKERAGE 47. Subject to the provisions of Section 76 of the Act, the Company may at any time pay a commission to any person in consideration of his subscribing or agreeing to subscribe for any shares in or debentures of the Company, or procuring, or agreeing to procure subscriptions for any shares in or debentures of the Company, but so that the commission shall not exceed in case of shares 5% (five percent) of the price at which the shares are issued, and in case of debentures, 2½ % (two and half percent) of the price at which the debentures are issued. Such commission may be satisfied by payment in cash or by allotment of fully or partly paid shares or partly in one way and partly in other. The company may pay a reasonable and lawful sum as brokerage. NOMINATION 48. (i) Every Share/Bond/Debenture holder and a Depositor under the Company s Public Deposit Scheme (Depositor) of the Company may at any time, nominate in the prescribed manner, a person to whom his Shares/Bonds/Debentures or deposits in the company shall vest in the event of his death. (ii) Where the Shares or Bonds or Debentures or Deposits in the Company are held by more than one person jointly, the joint holder may together nominate, in the prescribed manner, a person to whom all the rights in the shares or bonds debentures or deposits in the company, as the case may be, shall vest in the event of death of all the joint 15 Payment commission brokerage of and

16 holders. (iii) Pursuant to section 109A of the Act notwithstanding anything contained in any other law for the time being in force or in disposition, whether testamentary or otherwise, in respect of such Shares/ Bonds./Debentures or Deposits in the Company, where a nomination made in the prescribed manner purport to confer on any person the right to vest the Shares/Bonds/Debentures or Deposits in the Company, the nominee shall on the death of the Share/Bond /Debenture holder or a Depositor, as the case may be, on the death of the joint holders become entitled to all the rights in such Shares/Bonds/Debentures or deposits, as the case may be, all the joint holders in relation to such Shares/Bonds/Debentures, or Deposits, to the exclusion of all persons, unless the nomination is varied, cancelled in the prescribed manner. (iv) Where the nominee is a minor, it shall be lawful for the holder of the Shares/Bonds/Debentures or deposits, to make the nomination to appoint, in the prescribed manner, any person to become entitled to Shares/Bonds/Debentures or deposits in the Company, in the event of his death, during the minority. TRANSMISSION OF SECURITIES BY NOMINEE 49. A nominee, upon production of such evidence as may be required by the Board and subject as hereinafter provided, elect, either- (i) to be registered himself as holder of the Share/Bond/Debenture or Deposits, as the case may be; or (ii) to make such transfer of the Share/Bond/Debenture or deposits, as the case may be, as deceased Share/Bond/Debenture holder or Depositor could have made; (iii) if the nominee elects to be registered as holder of the Share/Bond/Debenture or Deposits, himself, as the case may be, he shall deliver or send to the Company a notice in writing signed by him stating that he so elects and such notice shall be accompanied with the death certificate of the deceased Share/Bond/Debenture holder or Depositor, as the case may be; (iv) a nominee shall be entitled to the same dividends and other advantages to which he would be entitled to, if he were the registered holder of the Share/Bond/Debenture or Deposits 16

17 except that he shall not, before being registered as a member in respect of his Share/Bond/Debenture or Deposits be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company, Provided further that the Board may, at any time, give notice requiring any such person to elect either to be registered himself or to transfer the Share/Bond/Debenture or Deposits, and if the notice is not complied with within ninety days, the Board may thereafter withhold payment of all dividends, bonuses or other moneys payable or rights accruing in respect of the Share/Bond/Debenture or deposits, until the requirements of the notice have been complied with. INCREASE, REDUCTION AND ALTERATION OF CAPITAL 50. Subject to the approval of NTPC, the Board may with the sanction of the company in a General Meeting, increase the Share capital by the creation of new Shares of such amount, as the resolution shall prescribe, retaining the agreed shareholding ratio. 51. New Shares shall be issued upon such terms and conditions and with such rights and privileges annexed thereto as the General Meeting resolving upon the creation thereof shall direct, and if no direction be given as the Board shall determine and in particular such Shares may be Preference Shares. The new shares (resulting from an increase of capital as aforesaid) may be issued or disposed of in accordance with the provision of Article Except so far as otherwise provided by the conditions of issue or by these presents, any capital raised by the creation of new Shares shall be considered part of the then existing capital of the company and shall be subject to the provisions herein contained with reference to payment of Dividends, calls and instalments, transfer and transmission, forfeiture, lien, surrender voting and otherwise. 53. Subject to the provisions of Section 100 to 105 of the Act the company may, from time to time, by Special Resolution reduce its Share capital ( including the capital redemption reserve account, if any ) in any way authorised by law and in particular by paying off capital or cancelling capital which has been lost or is unrepresented by available assets or is superfluous or by reducing the liability on the Shares or otherwise as may seem expedient, and capital may be paid off upon the footing that it may be called up again or otherwise; and the Directors may Power to increase Capital On what conditions share may be issued How far new shares to rank with existing shares Reduction of Capital etc. 17

18 subject to the provisions of the Act, accept surrender of Shares. 54. The Company may in General Meeting by a ordinary Resolution alter the conditions of its Memorandum as follows: (a) Consolidate and divide all or any of its Share capital into Shares of larger amounts than its existing Shares. Sub-division, consolidation and cancellation of shares (b) Sub-divide Shares or any of them into Shares of smaller amounts than originally fixed by the Memorandum of Association subject nevertheless to the provisions of the Act in that behalf. c) Cancel Shares which at the date of such General Meeting have not been taken or agreed to be taken by any person and diminish the amount of its Share capital by the amount of the Shares so cancelled. MODIFICATION OF RIGHTS 55. If at any time the capital of the company by reason of the issue of Preference Shares or otherwise is divided into different classes of Shares, all or any of the rights and privileges attached to each class may subject to the provisions of Section 106 and 107 of the Act be varied, modified, abrogated or dealt with the consent in writing of the holders of at least three fourth of the nominal value of the issued Shares of that class or with the sanction of a special resolution passed at a separate General Meeting of the holders of Shares of that class and all the provisions hereinafter contained as to General Meeting shall, mutatis mutandis apply to every such meeting, except that the quorum thereof shall be members holding or representing by proxy one fifth of the nominal amount of the issued Shares of that class. Power to modify rights BORROWING POWERS 56. Subject to the provisions of Section 292 and 293 of the Act, the Board may by means of a resolution passed at a meeting of the Board from time to time, borrow and/or secure the payment of any sum or sums of money for the purposes of the Company. 57. Subject to the provisions of the Companies Act, 1956, Company may raise or secure the payment of such sum or sums in such manner and upon such terms and conditions in all respects as they think fit and in particular by the issue of Bonds, perpetual or redeemable Debentures or Debenture Stocks or any mortgage or charge or other security on the Power to borrow Conditions on which money may be borrowed 18

19 property of the company (both present and future) including the uncalled capital for the time being. 58. Any Bonds, Debentures, Debenture Stocks or other securities issued or to be issued by the company shall be under the control of the Board who may issue them upon such terms and conditions and in such manner and for such consideration as they shall consider to be for the benefit of the company. 59. Subject to Section 79 and 117 of the Act, any Debentures, Debenture Stocks, Bonds or other securities may be issued at a discount, premium or otherwise and with any special privileges as to redemption, surrender, drawing, allotment of Shares, appointment of Directors and otherwise. Debentures, Debenture Stocks, Bonds and other securities may be made assignable free from any equities between the company and the person to whom the same may be issued. 60. Whenever any uncalled capital of the company is charged all persons taking any subsequent charge thereon shall take the same subject to such prior charge and shall not be entitled by notice to the Shareholders or otherwise, to obtain priority over such prior charge. 61. The Directors shall cause a proper Register of charges to be kept in accordance with the provisions of Section 143 of the Act. GENERAL MEETING 62. In addition to any other meeting, General Meetings of the company shall be held within such intervals as are specified in Section 166(1) of the Act and subject to the provisions of Section 166(2) of the Act, at such times and places as may be determined by the Board. Such General Meetings shall be called Annual General Meetings and shall be specified as such in the notice convening the meeting. Any other meeting of the company shall be called an Extra-ordinary General Meeting. Debentures, Bonds etc. to be under control of the Board Issue of shares at discount etc. Person not to have priority over any prior charge Register of Charges When general meeting to be held 63. Every Annual General Meeting shall be called at such times during business hours and on such days ( not being a public holiday) as the Board may from time to time determine; and it shall be held either at the Registered Office of the company or at such other place in the same city, town, village where the Registered office of the company is situated. 64. The Board may, whenever they think fit call an Extraordinary General Meeting and Extraordinary General Meeting shall also be called on such requisition, or in default may be called by Time and place for calling Annual General Meeting When other General Meeting to be held 19

20 such requisitionists, as provided by the Act. If at any time there are not within India sufficient Directors capable of acting to form a quorum of a Board meeting, any Director may call an Extraordinary General Meeting in the same manner as nearly as possible as that in which meetings may be called by the Board. 65. The company shall comply with the provisions of Section 188 of the Act so as to give notice of resolution and circulating statements on the requisition of members. Circulation member s resolution of 66. Save as provided in sub-section (2) of Section 171 of the Act, not less than twenty-one days notice shall be given of every General Meeting of the company. Every notice of meeting shall specify the place and the day and hour of the meeting and shall contain a statement of the business to be transacted thereat. Where any such business consists of special business as hereinafter defined there shall be annexed to the notice a statement complying with Section 173(2) and (3) of the Act. 67. Notice of every meeting of the company shall be given to every member of the company, to the Auditors of the company and to any person entitled to a Share in consequence of the death or insolvency of a member in any manner hereinafter authorized for the giving of notice to such persons. Notice of a General Meeting To whom notice is to be given Provided that where the notice of General Meeting is given by advertising the same in a newspaper circulating in the neighborhood of the office under sub section 53 of the Act, the statement of material facts referred to in Section (3) of Section 173(2) of the Act need not be annexed to the notice as required by that Section but it shall be specified in the advertisement that the statement has been forwarded to the members of the company. 68. The accidental omission to give any such notice to or its nonreceipt by any member or other persons to whom it should be given shall not invalidate the proceedings of the meeting. 69. A general meeting may however be called after giving shorter notice than twenty one days in terms of section171 (2) of the Act. Accidental omission to give notice Shorter notice by consent 20

21 PROCEEDINGS AT GENERAL MEETING 70. In the case of an Annual General Meeting all business to be transacted at the meeting shall be deemed special with the exception of business relating to consideration of the Profit and Loss Account, the Balance Sheet and the Reports of the Directors and of the Auditors, appointment of Directors in place of those retiring and declaration of Dividend. All other business transacted at an Annual General Meeting and all business transacted at an Extraordinary General Meeting shall be deemed special. 71. Five members present in person shall be the quorum for a General Meeting of the company. Business of Meetings Quorum 72. Both NTPC and BSEB as Shareholders of the Company, may, from time to time appoint one or more person(s) as their respective representative in such a manner that only one representative of each shareholder will be authorised at a given time ( who need not be a member(s) of the company ) to represent it at all or any meeting(s) of the Company. Rights of NTPC and BSEB to appoint any person as its representative A person appointed as above shall for the purpose of the Act deemed to be a member of the company and shall be entitled to exercise the same rights and powers (including the right to vote by proxy unless otherwise provided by the order of appointment ) as NTPC or BSEB, as the case may be, could exercise as a member of the company. NTPC and BSEB may from time to time cancel any appointment made as above and make further fresh appointments. The production at the meeting of a certified copy of resolution of the Board of NTPC and of BSEB as the case may be shall be accepted by the company as sufficient evidence of any such respective appointment or cancellation of aforesaid. 73. Any act or resolution which, under the provisions of these Articles or of the Act, is permitted or required to be done or passed by the company in General Meeting shall be sufficiently so done or passed if effected by an Ordinary Resolution as defined in Section 189(1) of the Act unless either the Act or these Articles specifically require such act to be done or resolution passed by a Special Resolution as defined in Section 189(2) of the Act. 74. No business shall be discussed at any General Meeting except the election of a chairman whilst the chair is vacant. Further Resolution to be Passed by Company in General Meeting Chairman to be elected first if 21

22 business will be discussed after the chair is occupied. 75. The Chairman of the Board shall be entitled to take the chair at every General Meeting. If there be no such Chairman, or if at any meeting the Chairman shall not be present within fifteen minutes after the time appointed for holding such meeting or is unwilling to act, the members present shall choose another Director as Chairman, out of the Directors nominated by NTPC on the Board of the Company, for the purpose of the meeting and he shall exercise all the rights and powers available to the Chairman. chair is vacant Chairman General Meeting of 76. If within half-hour from the time appointed for the meeting a quorum be not present, the meeting if convened on requisition of Shareholders shall be dissolved, but in any other case it shall stand adjourned to the same day in the next week, at the same time and place, or to such other day and at such time and place as the Board may by notice to members appoint. If at such adjourned meeting a quorum be not present, those members who are present, subject to minimum of two members, shall be a quorum and may transact the business for which the meeting was called. 77. In the case of an equality of votes, both on show of hands and on a poll, the Chairman of the meeting shall have a casting vote in addition to the vote or votes to which he may be entitled as a member. 78. At any General Meeting a resolution put to vote at the meeting shall be decided on a show of hands, unless a poll is ( before or after the declaration of the result of the show of hands ) demanded in accordance with provisions of the Act and unless a poll is so demanded, a declaration by Chairman that a resolution has on a show of hands been carried unanimously or by a particular majority or lost, and an entry to that effect in the books of proceedings of the company shall be conclusive evidence of the fact, without proof of the number or proportion of votes recorded in favour of or against that resolution. 79. Subject to the provisions of Section 180 of the Act, any poll duly demanded on the election of a chairman of a meeting out of the nominees of NTPC, or on any question of adjournment shall be taken at the meeting forthwith. In any other case poll shall be taken at such time not being later then 48 hours from the time when the demand was made, as the Chairman may direct. When quorum is not present, meeting to be dissolved and when to Be adjourned Chairman to have casting vote What to be evidence of the passing of a resolution where poll is not demanded When poll to be taken 80. The demand of a poll, except on the question of the election of Business may 22