INDIAN RAILWAY FINANCE CORPORATION LIMITED

Monitoring of Utilization of FundsIn terms of the SEBI Debt Regulations, there is no requirement for appointment of a monitoring agency inrelation to the use of proceeds of the Issue. Our Board of Directors shall monitor the utilisation of the proceedsof the Issue. Our Company will disclose in our financial statements for the relevant fiscal commencing fromFiscal 2013, the utilisation of the proceeds of the Issue under a separate head along with any details in relation toall such proceeds of the Issue that have not been utilized thereby also indicating investments, if any, of suchunutilized proceeds of the Issue. We shall utilize the proceeds of the Issue only upon the execution of thedocuments for creation of security as stated in this Prospectus Tranche-1 in the section titled “Terms of theIssue - Security” on page 54 and upon the listing of the Bonds.We propose to issue Bonds to Eligible NRIs and FIIs on a non-repatriable as well as repatriable basis. Under theprovisions of the Foreign Exchange Management (Borrowing and Lending in Rupees) Regulations, 2000, asamended, any monies borrowed from a person resident outside India cannot be used:(a) for any purpose except in ones own business other than (i) the business of chit fund, (ii) as Nidhi Company,(iii) agricultural or plantation activities or real estate business; or construction of farm houses; or (iv)trading in Transferable Development Rights (TDRs); or(b) for any investment, whether by way of capital or otherwise, in any company or partnership firm orproprietorship concern or any entity, whether incorporated or not, or for the purpose of re-lending.To ensure compliance with the aforementioned, we will open and maintain a separate escrow accounts with theEscrow Collection Banks in connection with all Application Amounts received from FIIs, Eligible NRIs, andother non resident Applicants across all Categories (the “Non Resident Escrow Accounts”). All applicationAmounts received from FIIs, Eligible NRI Applicants, and other non resident Applicants across all Categoriesshall be deposited in the Non Resident Escrow Account, maintained with each Escrow Collection Bank. Uponreceipt of requisite instructions from the Lead Managers and the Registrar in the manner detailed in the EscrowAgreement, the Escrow Collection Banks shall transfer the monies from the Non Resident Escrow Accounts to aseparate bank account, (“Non Resident Public Issue Account”), which shall be different from the Public IssueAccount. The Company shall at all times ensure that any monies kept in the Non Resident Escrow Account andthe Non Resident Public Issue Account shall be utilised only in accordance with applicable statutory and/orregulatory requirementsIssue ExpensesA portion of the Issue proceeds will be used to meet Issue expenses. The following are the estimated Issueexpenses*ParticularsAmount(` in lakhs)Percentage of proceeds ofthe Issue (in %)Percentage of total expensesof the Issue (in %)Fees payable to IntermediariesRegistrar to the Issue 15.00 0.00 # 0.34Legal Advisors 11.99 0.00 # 0.27Debenture Trustee 3.00 0.00 # 0.07Printing, advertising and marketing 500.00 0.06 11.25Lead Managers’ Fees, Brokerage**,Selling Commission and processingFees to SCSB3,200.00 0.36 72.02Other Miscellaneous Expenses 713.01 0.08 16.05Total 4,443.00* 0.50 100# Neglible*As per the Notification the total issue expenses shall not exceed 0.5% of the issue size.** As per the Notification the commission on sale to different categories shall be limited to the following ceilings: (i)qualified institutional buyers - 0.05%;(ii) corporates - 0.1%; (iii) high net worth individuals - 0.15%; and (iv) retailindividual investors - 0.75%.The Company shall pay processing fees to the SCSBs for Application Forms pertaining to ASBA Applicationsprocured by the Members of the Syndicate and Trading Members and submitted to the SCSBs for blocking theApplication Amount of the Applicant, at the rate of ` 15 per Application Form procured, as finalized by theCompany. However, it is clarified that in case of Application Forms pertaining to ASBA Applications procured29