Innovations for Healthy Living

The independent directors shall —

1. Purpose

The purpose of this policy is to determine material subsidiaries of the Company and to provide governance framework for all such subsidiaries of the Company.

2. Applicability

This policy will be applicable to the Company with effect from 01st October, 2014.

3. Definitions

  1. “Audit Committee” means the Audit Committee of Board of Directors constituted under the provisions of SEBI (Listing Obligations & Disclosure Requirements), Regulations, 2015 and the Companies Act, 2013.
  2. “Company” means Unichem Laboratories Limited
  3. “Control” shall have the same meaning as defined in SEBI (Substantial Acquisition of Shares and Takeover Regulations, 2011 as amended from time to time;
  4. “Material Subsidiary” is a subsidiary that satisfies any of the following conditions:
    • In which the investment of the Company, exceeds 20% of its consolidated net worth as per the audited balance sheet of the previous financial year; or
    • Have generated 20% of the consolidated income of the Company during the previous financial year.
  5. “Material Non Listed Indian Subsidiary” shall mean an unlisted subsidiary, incorporated in India, whose income or net worth (i.e. paid up capital and free reserves) exceeds 20% of the consolidated income or net worth respectively, of the Company in the immediately preceding accounting year.
  6. “Policy” shall mean this policy or “Material subsidiary policy”.
  7. “Significant Transaction or Arrangement” shall mean any individual transaction or arrangement that exceeds or is likely to exceed 10% of the total revenues or total expenses or total assets or total liabilities, as the case may be, of the material subsidiary for the immediately preceding accounting year.
  8. “Subsidiary” shall be as defined under the Companies Act, 2013 and the Rules made there under.

4. Governance and Control

At least one Independent Director of the Company shall be a director on the Board of Directors of the Material Non Listed Indian Subsidiary Company.

The Audit Committee of Board of the Company, shall review the financial statements of unlisted subsidiary company, in particular, the investments made by the unlisted subsidiary Company, shall be placed before the Board of the Company periodically.

The management shall periodically bring to the attention of the Board of Directors of the Company, a statement of all the significant transactions and arrangements entered into by the unlisted subsidiary company.

5. Disposal of Material Subsidiary

The Company shall not dispose shares of its Material Subsidiaries that reduces the Company’s shareholding (either on its own or together with other subsidiaries) to less than 50%; or

  1. ceases the exercise of control over the Subsidiary; without passing of a Special Resolution at its General Meeting, except in cases where such divestment is made under a scheme or arrangement duly approved by a Court/Tribunal, or ;
  2. sell, dispose or lease the assets amounting to more than twenty percent of the assets of the material subsidiary on an aggregate basis during a Financial year, shall require prior approval of the share holders by way of a special resolution, unless the sale/disposal/lease is made under a scheme of arrangement duly approved by a Court/ Tribunal.

6. Disclosures

This policy shall also be uploaded on the website of the Company at www.unichemlabs.com and a web link thereto shall be provided in the Annual Report of the Company.

This policy has been amended, approved and adopted by the Board of Directors at their meeting held on October 21, 2016.