VENTURE CAPITAL FUND FOR BACKWARD pete (Creating entrepreneurship among Backward ClassA fist of its kind Venture Capital Fund launched by Ministry of Socal Justice and Empowerment, Government of India to promote entrepreneurship in India among the Backward Classes by providing cconcessionalfinanceto thm. ‘The following are the eligbilty criteria for prospective Companies promoted by Backward Classes entrepreneursin he county for seeking assistance under the und: *+ The projects being set up in manufacturing, services sector and allied sectors ensuring asset Creation outofthefunds deployed + Startups would also be eligible forfinance as per the scheme guidelines; + Women andcisabied Backward Classes entrepreneurs willbe prefered: + Minimum existence and shareholding criteria: » If assistance is below Rs. 50 lath - Companies having atleast 51% stake holdings by Backward Classes entrepreneurs forthe past 6 months with management control OR anew Company provided thatthe new Company is a successor entity of a Proprietary Fim or Partnership Firm or One Person Company (OPC) or Limited Liability Partnership (LLP) orany ther establishment incorporated under any law in fore, with sound business model whic has been in operation for over 6 months, and the predecessor entity had at least 51% shareholding ofthe Backward Classes promoters with management contro. » assistance is above Rs.50 lakh - Companies having at least 51% stake holdings by Backward Classes entrepreneurs forthe past 12 months with management controlOR anew Company provided that the new Company isa successor entity of a Proprietary Firm or Partnership Firm or One Person Company (OPC) or Limited Liabilty Partnership (LLP) or any other establishment incorporated under any aw in force, wih sound businass model which has been in operation for over 12 months, and the predecessor entity nad atleast 51% ‘shareholding ofthe Backward Classes promaters with management contro. + Documentary proofs of being Backward Classes willhave tobe submitted. Funding Framework S.No Particulars oo Sizoottnancialasstance | i, 20 lakhs to Rs. 5 Crore (Maximum aggregate asisance not more than two times the cuert net worth ot the Company] 2 Tenure offinancialassistance | Upto 8 years including moratoriumperod. 3. | stumentsforimestment | + Eufy/ Opionaly Convertible Preference Shares / Compulsory Convertible Preterence Shares: 4 + Compulsory Converitie Deberiures, Optonaly Convertible Debentures, Non-Convertible Debentures, eteSI.No, Si 4 Funding Pattern Det Investment under te fund willbe categorized as folows: 1, Financial assistance upto Rs 1 Crore- Investment under this category shall be funded ‘maximum upto 75% of the project cost and the balance 25% ofthe project cost will be funded by the promoters; 2. Financialassistance above Rs. 1 Crore— 4, Investment under this category shall be funded ‘maximum upto 50% of the project cost. Atleast 25% of the project cost shall be funded by promoters and balance 25% of the project cost, an be funded either by promoters or by the bank or any other Financial Institutions as the case maybe, 5. Moratorium period for : redemption of principal On ase to case basis but ot more than 36 months from the date of investment in the Company. Howover, interest! coupon payment shall commence from date of investment in the Company at a regular interval as, etermined by the Investment Committee ofthe fund. 6 Returs/ Coupons/ Interest {ortinancial assistance) Equity instruments-15%p.a. + DebUConvertible Instruments - 8% pa. (For women*/disabled** entrepreneurs -7.75% p.a) [For considering a company owed by a Backward Glasses women entrepreneur, the Backward Classes ‘women entrepreneur should hold atleast 61% of the shareholding in the company and should be the ‘Managing Director ofthe Company; ** In the case of disabled entrepreneurs, guidelines Issued by the Department of Empowerment of persons with Disabilities for qualifying as disabled would beam Particulars Details 7. Security + The assets of the project being funded/ assisted ‘under the scheme shall be charged for security, The project assets will include land, building, plant & ‘machinery and rights on licenses) patents. ‘+ Part-pasu charge on assets with the Banks/Fis In ‘case of the companies applying for assistance of morethan Rs. 1 Crore. + 2 charge ofthe assets created out ofthe investment \wherethe 1st charge in held by the BankFs, *+ In addition to the charge on assets, postdated cheques and promissory notes shall be taken + Personal guarantees of the promoters along with buyback agreement shallbe entered. + Pledge of Shares held by promoters and forming atleast 26% stake of the Issued and Paid up capital shal be taken, However, the percentage of pledged shares wouldbe decided on case tocase basis. * In case adequate mortgage is not available, the borrower may arrange collateral and corporate (guarantees from family / tends / associates / group companies. a ‘erations + On case to case basis, the above condiions/terms! structure may vary and get modified/amended fromtimeto ime + The scheme is catering to various teritories; the scheme can be modified, reviewed alter 6 months tot year IFCTvENTORE For Further Details Kindly Contact: Investment Manager: IFCI Venture Capital Funds Ltd. 16" Floor, IFCI Tower61, Nehru Place, New Defhi-110019 ‘Tek: (491)(11)-41732567/76296453343, 2644492, Fax: (91) (11) 26453348 3 Website: ww ifiventure cam Ema: fundsbeifeiventurecom