Shopper's Stop Limited - Securities and Exchange Board of India

we may require. Should we not execute our expansion plan as envisaged because of
this, there could be time and cost overruns affecting the performance of our Company.
10. As on the date of this draft Red Herring Prospectus, there are family disputes
between some of our Promoters and the G. L. Raheja family as a result of which
there could arise, from time to time, claims and counterclaims, between some of
our Promoters and the G.L. Raheja family. Some of these claims and counterclaims
may have an impact on our Promoters. Our Promoters believe that such claims
and counterclaims may not have a material impact on our Company except for the
dispute relating to the premises from which we operate our store at Bangalore .
Nevertheless, the existence, value, impact and resulting liability, if any with regard
to such claims cannot be ascertained as on the date of this draft Red Herring
Prospectus. Further due to the nature of the family disputes and given that followup
action with respect to the distribution of the Mumbai Undivided Entities and
South Undivided Entities was not completed and is outstanding,
(a) as on the date of this draft Red Herring Prospectus our Promoters are unable to
disclose any information with respect to the Mumbai Undivided Entities;
(b) neither we nor our Promoters can, as on the date of this draft Red Herring
Prospectus ascertain the accuracy or the completeness of the disclosures relating
to the Southern Undivided Entities as made in this draft Red Herring Prospectus.
Further our Promoters are unable to state with certainty about any liability or
contingent liability in respect of the said entities.
Our Promoters have certified that pursuant to a family arrangement dated December 9,
1996 (the "Arrangement") executed between G.L. Raheja, Sandeep G. Raheja, Durga S.
Raheja, Sabita R. Narang (Nee Sabita G. Raheja) and Sonali N. Arora (Nee Sonali G.
Raheja) representing the G.L. Raheja family ( the ‘G.L. Raheja family’) and C.L. Raheja,
Jyoti C. Raheja, Ravi C. Raheja and Neel C. Raheja representing the C.L. Raheja family
( the ‘C.L.Raheja family’), all the immovable properties, businesses and assets, including
shareholding and ownership of companies mentioned in the said Arrangement, which
were jointly owned and controlled by both the families prior to the said 9 th December,
1996 (hereinafter collectively the "Properties"), were distributed between these two
families by their mutual consent in accordance with what was agreed interalia between
both the families in documents / writings dated April 5, 1996 and November 16, 1996 (the
"Writings").
While the Properties have been fully and completely distributed and vested in accordance
with the Arrangement including the completion of the formality of documentation, in some
cases due to family disputes and differences, certain further assurances and follow-up
action was not completed and is outstanding till the date of this draft Red Herring
Prospectus. These matters are more specifically:
(a) In respect of a few of the immovable properties documentation and/or possession in
favour of the respective families was not completed/handed over;
(b) In respect of few of the Properties, some documents, papers, certificates and deeds in
respect of the said Properties were not exchanged between the respective families;
(c) While transferring shares of certain companies that formed part of the Properties,
according to the Promoters certain immovable properties and assets remained to be
valued.
(d) Certain of the Properties distributed also carried with them the responsibility of making
repayment of certain third party loans and liabilities. While the Properties and the loans
and liabilities may have been distributed to one family group, the loans and liabilities
may still be secured by certain guarantees and other securities which were provided
by the other family group, which guarantees and securities had to be released as per
the Arrangement. While releases in respect of such guarantees and securities have
been done in most cases, there may be certain cases where the formalities of such
release were not completed by the concerned family.
Contentions in this regard may have been raised by the two families .
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