10.

adhere to certain conditions, including targets for the number of white label ATMs to be deployed by our
Company within specified periods of time, as well as ensuring that, within a specified timeline, the white
label ATMs that we deployed were enabled to process EMV chips and PIN cards. The RBI, by way of its
letter dated December 18, 2019, noted that we had not complied with the conditions of the certificate of
authorization granted to our Company, stating that our Company had deployed much fewer ATMs, on an
on-going basis, than as specified in the targets prescribed and applicable to us, and that our ATMs were
not enabled to process EMV chips and PIN cards within the specified timeline. In response, our
Company provided the RBI with reasons for its failure to comply with such conditions, including the
reduction of interchange fees and issues pertaining to cash sourcing, which were not accepted by the
RBI. Accordingly, the RBI, through a letter dated March 4, 2021, revoked our Company’s authorization
as a white label ATM operator. The revenue from our white label ATM business was 211.49 million,
%3.44 million and 22.00 million for the financial years 2021, 2020, and 2019, constituting 0.07%, 0.02%,
0.01% of our total revenue from operations, respectively. Although we are in compliance with all the
RBI circulars mentioned in this Risk Factor except as disclosed above as of the date of this Prospectus,
and there have been no past instances of penalties imposed on us with respect to non-compliance with the
regulatory requirements prescribed by the RBI and other Government agencies in the last three financial
years except as disclosed above, we cannot assure you that such non-compliances will not occur in the
future. Any penalties, cancellations or terminations of licenses, approvals and registrations held by us and
our Subsidiaries could have an adverse effect on our reputation and our ability to operate and manage our
business and may have an adverse effect on our business, results of operations, cash flows and financial
condition.

See “Key Regulations and Policies”, “Outstanding Litigation and Material Developments” and
“Government and Other Approvals” on pages 177, 358 and 384, respectively.

We will not directly receive any proceeds from the offer for sale. The Selling Shareholders, including
the Promoter Selling Shareholder, will receive the Offer proceeds, net of Offer expenses.

The Offer consists of an offer for sale. The Selling Shareholders shall be entitled to the net proceeds from
the Offer, which comprise proceeds from the Offer net of Offer expenses shared by the Selling
Shareholders, and our Company will not directly receive any proceeds from the Offer. Our Company and
Mr. Ravi B. Goyal (the Promoter Selling Shareholder) have entered into an agreement dated August 16,
2021, as amended, pursuant to which Mr. Ravi B. Goyal has agreed to purchase the VEPL CCPS
currently held by our Company from his share of the Offer Proceeds, net of expenses. Our Company
proposes to utilize such sale proceeds from the sale of VEPL CCPS primarily to redeem the outstanding
Listed NCDs issued by our Company. The sale of VEPL CCPS from our Company to Mr. Ravi B. Goyal
is proposed to be completed prior to listing of the Equity Shares. See “Objects of the Offer” on page 104.
If Mr. Ravi B. Goyal is unable to purchase the VEPL CCPS currently held by our Company, we may not
be able to redeem the outstanding Listed NCDs. See “— We have a substantial amount of outstanding
indebtedness, which requires significant cash flows to service, and limits our ability to operate freely.”
on page 43 and “History and Certain Corporate Matters — Other Agreements” on page 190.

There are outstanding legal proceedings involving our Company, our Directors, our Subsidiaries and
one of our Promoters.

There are outstanding legal proceedings involving our Company, our Directors, our Subsidiaries and one
of our Promoters. These proceedings are pending at different levels of adjudication before various courts,
tribunals, enquiry officers and appellate tribunals. The brief details of such material outstanding
litigations are as follows:

Litigation involving our Company

 

 

 

 

 

 

 

 

S.no. Nature of proceedings Nos en eee Gn
Litigation by our Company

t Criminal proceedings 63 66.20
2. Material civil cases ‘ 10
Litigation against our Company

i. Criminal proceedings i0 0.00
= Action taken by statutory and regulatory authorities 25* 0.00

 

 

 

 

31

 
