Radico Khaitan : Policy on Determination of Materiality for Disclosure of events or information

RADICO KHAITAN LIMITED

POLICY FOR DETERMINATION OF MATERIALITY OF ANY EVENT/ INFORMATION

1. Preface

The Board of Directors (the "Board") of Radico Khaitan Limited (the "Company") has adopted the following policy and procedures with regard to determination of Materiality of events or information (the "Policy") which are required to be disclosed to the Stock Exchanges in terms of Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations").

This Policy has been formulated in accordance with Clause (ii) of sub-regulation (4) of Regulation 30 ofthe Listing Regulations.

2. Purpose of the Policy

The purpose of this Policy is to determine materiality of events and information based on the criteria specified under clause (i) of sub-regulation (4) of Regulation 30 of the Listing Regulations and to ensure that the Company shall make disclosure of events / information specified in para A and B of Part A of Schedule III of the Listing Regulations to the Stock Exchanges.

3. Criteria for determination of materiality of events / information

The Company shall consider the following criteria as specified in clause (i) of sub-regulation 4 of Regulation 30 of the Listing Regulations for determination of materiality of events / information.

1. the omission of an event or information, which is likely to result in discontinuity or alteration of event or information already available publicly; or
2. the omission of an event or information is likely to result in significant market reaction if the said omission came to light at a later date;
3. the omission of an event or information, whose value or the expected impact in terms of value, exceeds the lower of the following:
4. 1. two percent of turnover, as per the last audited consolidated financial statements of the Company;
   2. two percent of net worth, as per the last audited consolidated financial

statements of the Company, except in case the arithmetic value of the net worth is negative;

(iii)five percent of the average of absolute value of profit or loss after tax, as per the last three audited consolidated financial statements of the Company.

(d) where the criteria specified above in (a), (b) and (c) are not applicable, an event or

information may be treated as material if in the opinion of the board of directors of the Company, the event or information is considered material.

4. Disclosure of events or information

1. The occurrence of following events / information, specified in para A of Part A of Schedule III to the Listing Regulations, shall be disclosed to the Stock Exchanges without any application of the guidelines for materiality:

1. Acquisition(s) (including agreement to acquire), Scheme of Arrangement (amalgamation, merger, demerger or restructuring), sale or disposal of any unit(s), division(s), whole or substantially the whole of the undertaking(s) or subsidiary of the Company, sale of stake in associate company or any other restructuring.
   Explanation (1) -For the purpose of this sub-paragraph, the word 'acquisition' shall mean-
2. 1. acquiring control, whether directly or indirectly; or
   2. acquiring or agreement to acquire shares or voting rights in a company, whether existing or to be incorporated, whether directly or indirectly, such that -
   3. 1. the Company holds shares or voting rights aggregating to five per cent or more of the shares or voting rights in the said company; or
      2. there has been a change in holding from the last disclosure made under sub- clause (a) of clause (ii) of the Explanation to this sub-paragraph and such change exceeds two percent of the total shareholding or voting rights in the said company; or
      3. the cost of acquisition or the price at which the shares are acquired exceeds the threshold specified in sub-clause (c) of clause (i) of sub-regulation (4) of regulation 30 of the Listing Regulations.

Explanation (2) -For the purpose of this sub-paragraph, "sale or disposal of subsidiary" and "sale of stake in associate company" shall include-

1. an agreement to sell or sale of shares or voting rights in a company such that the company ceases to be a wholly owned subsidiary, a subsidiary or an associate company of the Company; or
2. an agreement to sell or sale of shares or voting rights in a subsidiary or associate company such that the amount of the sale exceeds the threshold specified in sub- clause (c) of clause (i) of sub-regulation (4) of regulation 30 of the Listing Regulations.

Explanation (3)-For the purpose of this sub-paragraph, "undertaking" and "substantially the whole of the undertaking" shall have the same meaning as given under section 180 of the Companies Act, 2013.

1. Issuance or forfeiture of securities, split or consolidation of shares, buyback of securities, any restriction on transferability of securities or alteration in terms or structure of existing securities includingforfeiture, reissue of forfeited securities, alteration of calls, redemption of securities etc.

1. New Rating(s) or Revision in Rating(s).
2. Outcome of Meetings of the board of directors: The Company shall disclose to the Exchange(s), within 30 minutes of the closure of the meeting, held to consider the following:

1. dividends and/or cash bonuses recommended or declared or the decision to pass any dividend andthe date on which dividend shall be paid/dispatched;
2. any cancellation of dividend with reasons thereof;
3. the decision on buyback of securities;
4. the decision with respect to fund raising proposed to be undertaken;
5. increase in capital by issue of bonus shares through capitalization including the date on which suchbonus shares shall be credited/dispatched;
6. reissue of forfeited shares or securities, or the issue of shares or securities held in reserve for futureissue or the creation in any form or manner of new shares or securities or any other rights, privileges orbenefits to subscribe to;
7. short particulars of any other alterations of capital, including calls;
8. financial results;
9. decision on voluntary delisting by the listed entity from stock exchange(s):

Provided that in case of board meetings being held for more than one day, the financial results shall be disclosed within thirty minutes of end of the meeting for the day on which it has been considered.

1. Agreements (viz. shareholder agreement(s), joint venture agreement(s), family settlement agreement(s) (to the extent that it impacts management and control of the Company), agreement(s)/ treaty(ies)/contract(s) with media companies) which are binding and not in normal course of business, revision(s) or amendment(s) and termination(s) thereof.
2. Agreements entered into by the shareholders, promoters, promoter group entities, related parties, directors, key managerial personnel, employees of the Company or of its holding, subsidiary or associate company, among themselves or with the Company or with a third party, solely or jointly, which, either directly or indirectly or potentially or whose purpose and effect is to, impact the management or control of the Company or impose any restriction or create any liability upon the Company, shall be disclosed to the Stock Exchanges, including disclosure of any rescission, amendment or alteration of such agreements thereto, whether or not the Company is a party to such agreements:
   Provided that such agreements entered into by the Company in the normal course of business shall not be required to be disclosed unless they, either directly or indirectly or potentially or whose purpose and effect is to, impact the management or control of the Company or they are required to be disclosed in terms of any other provisions of these regulations.
   Explanation: For the purpose of this clause, the term "directly or indirectly" includes agreements creating obligation on the parties to such agreements to ensure that listed entity shall or shall not act in a particular manner.
3. Fraud or defaults by the Company, its promoter, director, key managerial personnel, senior management or subsidiary or arrest of key managerial personnel, senior management, promoter or director of the Company, whether occurred within India or

abroad:

For the purpose of this sub-paragraph:

(i)'Fraud' shall include fraud as defined under Regulation 2(1)(c) of Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003.

1. 'Default' shall mean non-payment of the interest or principal amount in full on the date when the debt has become due and payable.

Explanation 1 - In case of revolving facilities like cash credit, an entity would be considered to be in 'default' if the outstanding balance remains continuously in excess of the sanctioned limit or drawing power, whichever is lower, for more than thirty days.

Explanation 2 - Default by a promoter, director, key managerial personnel, senior management, subsidiary shall mean default which has or may have an impact on the Company.

1. Change in directors, key managerial personnel (Managing Director, Chief Executive Officer, Chief Financial Officer, Company Secretary etc.), Senior Management, Auditors and Compliance Officer.
2. In case of resignation of the auditor of the Company, detailed reasons for resignation of auditor, as given by the said auditor, shall be disclosed to the stock exchanges as soon as possible but not later than twenty four hours of receipt of such reasons from the auditor.
3. Resignation of independent director including reasons for resignation: In case of resignation of an independent director of the Company, within seven days from the date of resignation, the following disclosures shall be made to the stock exchanges:
4. 1. The letter of resignation along with detailed reasons for the resignation as given by the said director.
   2. Names of listed entities in which the resigning director holds directorships, indicating the category of directorship and membership of board committees, if any.
   3. The independent director shall, along with the detailed reasons, also provide a confirmation that there is no other material reasons other than those provided.
   4. The confirmation as provided by the independent director above shall also be disclosed by the Company to the stock exchanges along with the disclosures as specified in sub-clause (a) and (b) above.
5. In case of resignation of key managerial personnel, senior management, Compliance Officer or director other than an independent director; the letter of resignation along with detailed reasons for the resignation as given by the key managerial personnel, senior management, Compliance Officer or director shall be disclosed to the stock exchanges within seven days from the date that such resignation comes into effect.
6. In case the Managing Director or Chief Executive Officer is indisposed or unavailable to fulfil the requirements of the role in a regular manner for more than forty five days in any rolling period of ninety days, the same along with the reasons for such indisposition or unavailability, shall be disclosed to the stock exchange(s).
7. Appointment or discontinuation of share transfer agent.

1. Resolution plan/ Restructuring in relation to loans/ borrowings from banks/ financial institutions including the following details:
2. 1. Decision to initiate resolution of loans/borrowings;
   2. Signing of Inter-Creditors Agreement (ICA) by lenders;
   3. Finalization of Resolution Plan;
   4. Implementation of Resolution Plan; and
   5. Salient features, not involving commercial secrets, of the resolution/ restructuring plan as decided by lenders.
3. One time settlement with a bank.
4. winding-uppetition filed by any party / creditors.
5. Issuance of Notices, call letters, resolutions and circulars sent to shareholders, debenture holders or creditors or any class of them or advertised in the media by the Company.
6. Proceedings of Annual and extraordinary general meetings.
7. Amendments to memorandum and articles of association, in brief.
8. (a) Schedule of analysts or institutional investors meet at least two working days in advance (excluding the date of the intimation and the date of the meet) and presentations made by the Company to analysts or institutional investors.
9. 1. 
      Explanation: For the purpose of this clause 'meet' shall mean group meetings or group conference calls conducted physically or through digital means.
   2. Audio or video recordings and transcripts of post earnings/quarterly calls, by whatever name called, conducted physically or through digital means, simultaneously with submission to the recognized stock exchange(s), in the following manner:

1. 1. the presentation and the audio/video recordings shall be promptly made available on the website and in any case, before the next trading day or within twenty-four hours from the conclusion of such calls, whichever is earlier;
   2. the transcripts of such calls shall be made available on the website within five working days of the conclusion of such calls.
2. The following events in relation to the corporate insolvency resolution process (CIRP) of the Company under the Insolvency Code:
3. 1. Filing of application for initiation of CIRP, also specifying the amount of default;
   2. Filing of application by financial creditors for initiation of CIRP against the Company, also specifying the amount of default;
   3. Admission of application by the Tribunal, along with amount of default or rejection or withdrawal, as applicable;
   4. Public announcement made pursuant to order passed by the Tribunal under section 13 of Insolvency Code;
   5. List of creditors as required to be displayed by the corporate debtor under regulation 13(2)(c) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016;
   6. Appointment/ Replacement of the Resolution Professional;