sejal architectural glass limited - Securities and Exchange Board of ...

utilized portion of the licence. Additionally, the respective authorities have the discretion to levy penalties
and / or interest for any defaults on a case-to-case basis.
Further, our company proposes to import certain plant & machinery for our float glass project, under the
EPCG scheme, in terms of which, capital goods may be imported at a concessional rate of custom duty.
Under the EPCG scheme, we are required to export goods aggregating in value to eight times of the import
duty saved within 8 years, failing which an amount equivalent to the duty amount saved along with the
interest at applicable rates would be required to be paid to the Government of India. We have an aggregate
outstanding export obligation of USD 88,75,045.80 under the EPCG Scheme. For further details please refer
to the section titled “Our Business” beginning on page [●]_of this Draft Red Herring Prospectus.
23. Our ability to pay dividends will depend upon future earnings, financial condition, cash flows, working
capital requirements, capital expenditures, lender’s approvals and other factors.
We have been paying dividends to our shareholders. However, the amount of our future dividend payments,
if any, will depend upon our future earnings, financial condition, cash flows, working capital requirements,
capital expenditures, lender’s approvals and other factors. There can be no assurance that we shall have
distributable funds or that we will declare dividends in the future.
24. We have entered into certain related party transactions.
We have entered into certain related party transactions with our Promoters, Directors, Promoters Group
entities and key managerial personnel. For further details, please refer to the section titled “Financial
Statements - Related Party Transactions” beginning on page [•] of this Draft Red Herring Prospectus.
25. We have availed unsecured loans, which are repayable on demand.
As per our financial statements, as on September 30, 2007, we have unsecured loan of Rs. 1565.85 Lacs, of
which Rs. 661.10 Lacs are availed from group / associate companies / directors / promoters and Rs. 904.75
Lacs are from others, which is repayable on demand. Any demand from lenders for repayment of such
unsecured loans, may adversely affect our business operations and cash flow position. For further details of
these unsecured loans, please refer to Auditors’ Report- Financial Statements beginning on page [•] of this
Draft Red Herring Prospectus.
26. Upon completion of the Issue, our Promoters and Promoter Group may continue to retain majority
holding in our Company, which will allow them to influence the outcome of matters submitted to
shareholders for approval.
Upon completion of this Issue, our Promoters and Promoter Group will own 52.11% of our Equity Shares on a
fully diluted basis. As a result, our Promoters Group will have the ability to exercise significant influence
over all matters requiring shareholders’ approval, including the election of directors and approval of
significant corporate transactions. Our Promoters and Promoters Group will also be in a position to influence
any shareholder action or approval requiring a majority vote, except where it is required by applicable laws
to abstain from voting. Such a concentration of ownership may also have the effect of delaying, preventing
or deterring a change in control.
27. One of our products i.e. Kool Glass, currently forms a major part of our revenue and any decrease in
the demand for Kool Glass could adversely affect our sales revenue and our business profitability.
Currently, major part of our sales revenue 47.87 % for FY 2007 (as per our financial statements) is derived
from Kool Glass. In case of any decrease in the demand of Kool Glass, our sales revenue and business
profitability may be adversely affected.
28. We depend on few suppliers for substantial portion of our raw material purchases.
17