KAMAT HOTELS (INDIA) LIMITED
PROPOSED SALE OF HOTEL PROPERTY – LOTUS BEACH RESORT, GOA
NON BINDING INDICATIVE LETTER OF INTENT
The purpose of this Letter of Intent ("LoI") is to record broad terms and conditions for the
proposed sale and transfer of Identified Assets (as defined below) in respect of assets relating
to Lotus Beach Resort - Goa situated at Beach Road via Maria Hall, Vaswaddo, Benaulim,
Salcete – Goa- 403 716 ("Lotus Beach Resort-Goa") on 'as is where is' basis by the Kamat Hotels
(India) Limited (Seller) to the ______________________________ [insert name] ("Proposed
Transaction") and to set forth certain non-binding understandings and certain binding
agreements by and among the parties to this LoI.
Part I - Non-Binding Provisions
The following numbered paragraphs set out in Part I of this LoI (collectively, the "Non-Binding
Provisions") reflect our mutual understanding of the matters described herein, but each
Party to this LoI acknowledges that the Non-Binding Provisions are not intended to create or
constitute any legally binding obligation between the Seller and the Purchaser (collectively
referred to as the "Parties" and severally as the "Party"). No Party shall have any liability to
the other Party with respect to the Non-Binding Provisions until fully integrated, Definitive
Agreements (defined below) are prepared, authorised, executed and delivered by and
between the Parties containing therein, in addition to specific terms, such terms and
conditions as are customary to such transaction. If, for any reason, the Definitive Agreements
are not prepared, authorised, executed or delivered, no Party shall be liable to the other
Party for any duty or obligation in connection with, arising from, or relating to the NonBinding Provisions.
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1.
Seller
Kamat Hotels (India) Limited
The Seller is inter alia engaged in the business of owning,
managing and operating hotels, restaurants, pubs, lounges
and other hospitality and food & beverages related
establishments across India.
2.
Purchaser
[insert details of the purchaser]
The Purchaser is inter alia engaged in the business of [insert
business].
3.
Identified Assets
The following Identified Assets will be transferred and
conveyed to the Purchaser, on the Completion Date:
1. Lotus Beach Resort - Goa (immovable Property), details of
which are set out in Annexure [A];
2. Entire land, building, fixed assets in relation with the
Lotus Beach Resort Goa, if any; and
3. Entire movable machineries, assets, furniture & fixtures,
F&B/housekeeping material items such as crockery,
cutlery, linens etc. in relation with the Lotus Beach Resort
Goa.
4.
Lenders
The Lotus Beach Resort Goa is currently mortgaged to State
Bank of India.
4.
Purchase Price
The purchase consideration for the transfer of the Identified
Assets in respect of the Lotus Beach Resort Goa on 'as is
where as basis' shall be _________________________ [insert
amount] (the "Purchase Price") including to the extent of
payment required to be made to Lenders in accordance with
the terms of this LoI.
5.
Earnest
Deposit
refundable)
Money Simultaneously upon execution of this LoI, the Purchaser shall
(Non deposit non-refundable earnest money to the Seller in the
following manner:
(i)
20% of the total Purchase Consideration by Pay Order
/ Demand Draft in Indian Rupees payable in Mumbai
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(ii)
on the date of execution of the LOI; and
80% of the total Purchase Consideration in an escrow
account within Ninety (90) Days from the date of
execution of the LOI, jointly held by the parties, with
respect to the sale of Identified Assets relating to
Lotus Beach Resort Goa, for the purpose of payment
to the Lenders on to the Completion. Time shall
remain the essence of this LOI.
6.
Escrow Mechanism
The Purchaser shall within Ninety (90) days from the date of
signing the LOI, deposit 80% of the total Purchase
Consideration, in escrow account, jointly held by the Parties
for the purpose of payment to the Lenders and for the
purpose of satisfaction of the debt and release of the
mortgage over the Lotus Beach Resort Goa.
7.
Definitive Agreements
The Parties will enter into the following agreements
(collectively defined as the "Definitive Agreements"):
1. escrow agreement;
2. sale deed/deed of conveyance; and
3. such other agreements as may be necessary for giving
effect to the Proposed Transaction.
Upon the execution, the Definitive Agreements will
supersede and replace this LoI and all other communications
between the Parties, whether oral or written.
8.
Condition
Completion
to The completion of the Proposed Transaction shall be subject
to the satisfaction of the following conditions precedent
("Conditions Precedent"):
1. completion of legal diligence by the Purchaser;
2. execution of the Definitive Agreements for the identified
Assets on “as is where is basis”;
3. obtaining necessary corporate and lenders consents;
9.
Completion
Subject to fulfilment of all the condition precedents as set out
in paragraph 8 above, the Completion of the Proposed
Transaction shall be done on or before the Long Stop Date
("Completion Date") upon payment of the entire Purchaser
Price within Ninety (90) days from the date of signing of the
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Lol by the Purchaser to the Seller ("Completion") in terms of
the LoI.
Notwithstanding to anything contained in this LoI, it is
clarified and expressly agreed between the Parties that the
earnest money deposited by the Purchaser shall not create
any right or title or interest of whatsoever nature over or
with respect to the Identified Assets and all the right or title
or interest over or with respect to the Identified Assets and
its possession thereof shall remain vested with the Seller only
until and unless the Completion takes place and the
Purchaser has made payment of the entire Purchaser Price to
the Seller in terms of the LoI.
Management of Lotus The above purchase price would not cover Seller’s support for
full operational and management support to the Buyer for a
Beach Resort Goa
minimum period of 24 months and such extended period as the
parties may mutually decide. For above, Buyer would pay seller
a management fee equivalent to __% of Net Revenue (i.e. Gross
Revenue from operations minus all applicable taxes included in
such revenue) earned for the period of such services. A separate
agreement in this regard would be entered into.
Part II - Binding Provisions
Upon execution by the Seller and the Purchaser of this LoI or counterparts thereof, the
following paragraphs of this LoI under Part II (collectively, the "Binding Provisions") will
constitute the legally binding and enforceable agreement of each Party in recognition of the
significant time and costs invested by the Seller, in pursuing this Proposed Transaction and
further in consideration of their mutual undertakings as to the matters described herein.
11.
Exclusivity
The Purchaser shall not, directly or indirectly, through any
representative or otherwise, (i) initiate, solicit or otherwise
encourage, any inquiries or the making of any other proposal
or offer for hotel or hospitality property; and/or (ii) solicit,
participate in or entertain bids from, negotiate with or in any
manner encourage, discuss, accept or consider any proposal
of other proposal of similar nature, whether through direct
purchase, merger, consolidation or other business
combination or any other transaction which has an economic
impact similar to the Proposed Transaction; and/or (iii) enter
into any back to back agreement or such other documents for
10.
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sale of Identified Assets to any third party without prior
approval of the Seller.
The Seller shall in its sole discretion may (i) discuss the
Proposed Transaction with any third party/ or to more than
one proposed purchasers to initiate, solicit or otherwise
encourage, any inquiries or the making of any proposal or
offer in relation to the sale /transfer of the Identified Assets
of Lotus Beach Resort Goa whether for terms more
favourable to the present terms or otherwise.
Provided that in the event the Seller sells/transfer the
Identified Assets to any third party, the Seller shall return the
Earnest Money Deposit [without any interest to the
Purchaser].
12.
Publicity
The Parties agree that no public announcement of Proposed
Transaction shall be made by either Party (and such Party
shall not permit any agent or affiliate to make) unless
otherwise mutually agreed in writing by the Parties prior to
making any public announcement. Where disclosure is
required by applicable law, the issuing Party shall consult with
the other Parties reasonably prior to the date when such
disclosure is required to be made and shall agree upon the
nature, content and form of such disclosure in writing.
13.
Confidentiality
Unless otherwise agreed to in writing by the Parties hereto
and subject to all applicable laws in this regard, neither the
Purchaser nor the Seller shall, directly or indirectly, disclose,
or permit the disclosure of: (i) the existence or contents of
this LoI or of discussions regarding the Proposed Transaction
between the Parties; or (ii) any of the terms, conditions or
other aspects of the Proposed Transaction in this LoI or
subsequently proposed by either party, except to its
respective representatives only on need to know basis and
who shall be bound by a confidentiality obligation. If this LoI
is terminated pursuant to paragraph 14 (Term and
Termination) below, the Purchaser shall promptly return all
the documents, material, information provided by the Seller
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including any third party reports and studies done by the
Purchaser to the Seller within seven(7) days. The obligation
in this paragraph shall survive the termination of this LoI and
continue to bind the Parties.
14.
Term
Termination
and This LoI shall be valid till the earlier of, (i) Ninety (90) days
from date of signing of this LoI; or (ii) such other later date as
may be mutually agreed in writing between the Parties.
("Long Stop Date"). Time is the essence of this LOI.
The Binding Provisions may be terminated:
1. by mutual written consent of the Parties; or
2. by the Seller (i) on or prior to the Long Stop Date, without
ascribing any reasons thereof, whereupon the Seller shall
contemporaneously with termination, return the Earnest
Money Deposit without any interest to the Purchaser; or
(ii) on the Long Stop Date, in the event the Purchaser is
not able to arrange the Purchase Price, whereupon, the
Seller shall forfeit the Earnest Money Deposit or any other
amount paid by the Purchaser to the Seller under this LOI;
or
3. by the Purchaser, in the event (i) non-compliance of any
of the Condition to Completion by the Sellers (as given
under Paragraph 8), whereupon the Seller shall
contemporaneously with termination, return the Earnest
Money Deposit without interest to the Purchaser; and (ii)
for any reason other than the non-compliance of any of
the Condition to Completion by the Sellers (as given under
Paragraph 8) , whereupon the Seller shall forfeit the
entire amount paid till Long Stop Date.
15.
Cost and Expenses
The Parties will bear their respective costs of conducting due
diligence, legal advisor’s fee and other costs incidental to the
Proposed Transaction.
The Purchaser shall bear the stamp duty, registration fees
and other transfer taxes and costs in relation to the Proposed
Transaction and the Definitive Agreements.
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16.
Non Creation of any It is clarified and expressly agreed between the Parties that
right or title or until and unless the Completion takes place and the
interest
on
the Purchaser has made payment of the entire Purchaser Price to
Property
the Seller in terms of the LoI, the earnest money deposited by
the Purchaser shall not create any right or title or interest of
whatsoever nature over or with respect to the Identified
Assets and all the right or title or interest over or with respect
to the Identified Assets and its possession thereof shall
remain vested with the Seller only.
17.
Other Conditions
This LoI contains the entire understanding arrived at between
the Parties with respect to the Proposed Transaction and
supersedes all prior representations, communications,
inducements, promises or agreements, oral or otherwise,
which are not embodied in this LoI.
No amendment or waiver of any provision of this LoI, nor
consent to any departure there from, shall be effective unless
the same shall be in writing and duly signed by each Party,
and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it is
given. No failure on the part of a Party to exercise, and no
delay in exercising any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise
thereof or the exercise of any other right.
18.
Arbitration
The Parties agree that if any dispute or difference arises
between the Parties with respect to this LoI, such dispute
shall be referred to arbitration. The Parties shall mutually
appoint a sole arbitrator to resolve the dispute or differences.
The place of arbitration shall be Mumbai, India and the
language of arbitration shall be English.
The arbitration proceedings shall be governed by the
provisions of the Arbitration and Conciliation Act, 1996. The
arbitrator's award shall be substantiated in writing. The
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arbitrators shall also decide on the costs of the arbitration
procedure. The Parties shall submit to the arbitrator's award
and the same shall be enforceable in any competent court of
Mumbai Jurisdiction.
19.
Governing Law
This LoI shall be governed by, subject to and construed in
accordance, with the Laws of India, and the courts of
Mumbai, India shall have exclusive jurisdiction.
Please sign and date this LoI in the space provided below to confirm our mutual understandings
and agreements as set forth in this LoI and return a signed copy to the undersigned.
___________________________
For Seller
Mr. Vikram Kamat
Designation: Director
For Kamat Hotels (India) Limited
Date: ___.03.2014
___________________________
For Purchaser
Mr. [insert name]
Designation: Director
For [insert name]
Date: ___.03.2014
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Annexure A
Details of Lotus Beach Resort Goa
All that plot of land admeasuring 3894.00 square metres or thereabouts of the Whole property
known as “NONO LANCO DE PRAIAS” forming part of the landed property bearing Survey Nos.
363, 364 and 364/1 to 364/11 situate lying and being at Benaulim, within the local limits of
Village Panchayat of Benaulim, Taluka and Registration Sub District of Salcete, District Goa,
State of Goa and bounded as follows:
On the EAST
:
By the open area adjoining A – 1 type structures, the open area
and the internal 7mts wide road;
On the WEST
:
By open area adjoining the buildings C - 1 and B - 1, Rowhouses;
On the NORTH
:
By 7 mtrs. Wide internal road of the comples; and
On the SOUTH
:
By 3 mtrs. Wide internal; road, rear set back and the compound
wall.
TOGETHER WITH all structures, buildings, plant and machinery, equipments and all
moveable/immovable assets, as is where is basis known as “LOTUS RESORTS”.
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