Contractual

Governed by the Indian Contract Act, 1872 (bailment and pledge provisions, Sections 172 to 176) and the tripartite Share Pledge Agreement / STA.

Corporate and filings

The Companies Act, 2013 (charge registration under Section 77 where applicable) and depository participant pledge-creation mechanics through NSDL and CDSL.

Securities law

SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, and pledge and encumbrance disclosure norms on stock exchanges (BSE and NSE).

Statutory holding limits

Banks are generally restricted from holding more than 30% of a company's equity, unless specific restructuring or enforcement exceptions apply (see the Banking Regulation Act, 1949 and regulator guidelines).

Every mandate is run on the terms of the agreement signed by the parties, and regulatory applicability depends on the facts of each case.

1. Pre-execution and structuring

• Vetting the Share Pledge Agreement, promoter undertakings and corporate authorisations (Board and shareholder resolutions).
• Ensuring the shares are fully paid-up, free from prior liens and encumbrances, and permitted to be pledged under the company's Articles of Association.
• Coordinating depository mechanics for demat share blocking and pledge creation in favour of the trustee.

2. Custody and holding

• Holding the legal and fiduciary benefit of the pledge on behalf of a single lender or a consortium.
• Working within statutory bank holding limits by holding concentrated or large promoter equity stakes safely as a neutral fiduciary.
• Tracking corporate actions (dividends, bonus shares, rights issues, splits) and ensuring economic benefits flow as per the contract and waterfall.

3. Valuation, margin and covenant monitoring

• Tracking market prices of listed pledged shares daily, weekly or monthly.
• Calculating Loan-to-Value (LTV) or asset cover ratios against agreed volatility margins.
• Issuing margin call or top-up notices if collateral value falls below required thresholds.
• Processing requests to release excess pledged shares after partial debt reduction or LTV rebalancing.

4. Regulatory and exchange disclosures

• Facilitating or verifying statutory pledge and encumbrance reporting with the target company's secretarial team and stock exchanges under SEBI SAST guidelines.

5. Default and enforcement

• Acting strictly on lender voting thresholds and instructions upon an Event of Default.
• Invoking the demat pledge through depository participants, or executing sale or transfer of pledged shares in the open market or by negotiated arrangement, as permitted by law and contract.
• Distributing realisation proceeds to lenders per the agreed waterfall, and executing charge release and satisfaction documents on full repayment.

1. Fiduciary duty and impartiality

• Prioritise unit-holder interests above all; ensure the Sponsor, Manager or their associates never extract preferential or prejudicial benefits.
• Exercise independent professional judgment, high standards of integrity and continuous due diligence.

2. Registration and documentation vetting

• Assist in drafting, vetting and executing the Trust Deed, Private Placement Memorandum (PPM), Contribution Agreement and Investment Management Agreement (IMA).
• Ensure adequate stamp duty is paid on transaction documents.
• Hold original legal and title documents and agreements in safe custody.

3. Scheme ring-fencing and segregation

• Ensure strict segregation and ring-fencing of assets and liabilities across multiple schemes of the same AIF.
• Verify that separate bank, demat and custodial accounts are maintained for each scheme.

4. Oversight and compliance monitoring

• Track adherence to SEBI investment restrictions, such as concentration limits (for example, a maximum of 25% of investable funds in a single investee company for Category I and II AIFs), leverage limits and restrictions on unapproved associate investments.
• Review periodic compliance reports and quarterly and annual audits, and monitor the Manager's compliance calendar.
• Monitor related-party transaction safeguards and arm's-length requirements.

5. Operational and distribution controls

• Co-sign or authorise major trust and scheme financial statements, approve independent valuer appointments for portfolio companies, and oversee proper valuation methodology adherence.
• Oversee proper distribution of proceeds as per the waterfall agreed in the PPM and Contribution Agreement.

6. Default, deviation and grievance handling

• Intervene when investment-condition breaches or deviations occur, and direct the Manager to rectify non-compliance.
• Address escalated investor grievances, or coordinate responses through regulatory channels such as SCORES.
• Facilitate action if a scheme is tagged "inoperative" or undergoes winding-up or dissolution.

The Indian Succession Act, 1925

Governs wills for Hindus, Buddhists, Sikhs and Jains (through Section 57 and Schedule III), as well as Christians, Parsis and Jews.

Personal law

Muslims are governed by Muslim personal law (Shariat), which restricts testamentary disposition to a maximum of one-third of net assets after funeral and debt expenses, unless consenting heirs agree otherwise.

Executor

The person named by the testator to carry out the will and administer the estate. If none is named, heirs seek Letters of Administration.

Beneficiary or legatee

A person who inherits assets under the will.

Codicil

A later legal instrument that modifies, adds to or revokes part of an existing will. It needs the same execution and attestation formalities.

Probate

Certification of a will by a court of competent jurisdiction.

Revocation

A living testator can revoke a will at any time by making a later will or codicil that expressly revokes it, or by destroying, tearing, burning or mutilating it with the intention to revoke it. Marriage: the effect of marriage on an existing will depends on the testator's personal law, and personal laws or later family settlements or statutes may also interact with estate claims, so take advice.

Testator

The person making the will.

Independence

We act as a neutral stakeholder. We do not favour one party over another, and we act strictly on the terms of the agreement.

Transparency

Time-stamped records and clear reporting, so every entitled party can see what has happened and why.

Compliance

Documentation, conditions and reporting aligned with the regulatory norms that apply to each mandate.