FTIL wishes to help NSEL through all the possible means to recover from the crisis

1. FTIL’S SETTLEMENT PROPOSAL
FOR THE RESOLUTION OF NSEL
CRISIS

2. Agenda
• Motive behind settlement proposal
• Payment timeline
• Advantages of ‘without prejudice’ proposal
• Brokers involvement is must
• Recovery from NSEL Defaulters
• Recovery and Distribution process
• If No solution provided by brokers or trading
clients
• FTIL’s future course of action

3. Motive behind settlement proposal
• The “without prejudice” proposal by FTIL towards resolution of the
crisis warrants that all parties viz., brokers, trading clients,
government and others participate with a resolution oriented
mindset

4. The Proposal for Settlement:
• The settlement proposed will provide relief to 12,735 (100%) Trading Clients
• The source of funds:
• a. Settlement of the dues of the Trading Clients with an additional payment of
Rs.2,679.50 crores, i.e. about 50% of the total outstanding claim of Rs. 4875 crores.
• b. First round of payments made to be equally by NSEL&BROKERS, as under:
• • NSEL: Rs. 500 crores*
• • Brokers: Rs. 500 crores
• • Sub-Total: Rs.1000 crores
• • Total Payment: Rs.820 crores (for immediate payment).
• *Rs.180 crores already paid through FTIL loan + Rs. 320 crores to be brought in

5. Proposal for payments
• The amount of Rs.820 crores will be used to make payments to Trading Clients
at B and C Trading Clients at D may be paid through amounts recovered from
the Defaulters. The proposal for payments is, as under:

6. Payment timeline
• As per the proposal 94% of the trading
clients can receive 50% to 100% of their
claims, approximately within 3-4 weeks
of all legal formalities being completed
• The balance 6% trading clients can
receive their claims approximately within
3-4 months from amounts recovered
from Defaulters

7. Advantages of ‘without prejudice’
proposal
• The structure of the “without prejudice” proposal envisages an escalating
waterfall pattern –
• The Small Claimants (below Rs.10 lakhs, being 7,053 in number)
constituting 55.38% will receive 100% of their claim
• The mid-level claimants (between Rs. 10 lakhs and Rs. 1 crore, being 4901
in number) constituting 38.48% will receive 50% of their claim
• This aggregates to 11,954 in number constituting 93.86% of the total
claimants.
• The PSUs will receive 100% of their claim.
• High Net-worth trading clients (781 in number) constituting 6% of the total
claimants will receive 50% of their claim.

8. Brokers involvement is must
• The settlement proposal mandates participation of brokers for the exercise
to be successful as the privity of contract of trading clients of NSEL are with
their respective brokers
• Trading clients traded on NSEL exchange platform through their brokers
under a Client-Broker agreement and the first point of contact/grievance
for trading clients are their respective brokers

9. Recovery from NSEL Defaulters
• The investigating agencies have established the money trail to 22
defaulting members of NSEL and it is imperative that they honour
their ‘pay-in’ obligations towards NSEL
• While 8 defaulters account for Rs 4,823 crore of the pay-in,
constituting 86% of the outstanding, Rs 513 crore worth decrees
have been obtained against 5 Defaulters by NSEL from the Bombay
High Court
• Eleven defaulters have admitted to liabilities worth Rs 2,095 crore
before various courts and fora. ED has seized assets worth Rs 700 cr
belonging to the defaulters. Defaulters’ assets worth around Rs
5,000 cr of has been attached by the EoW under the MPID Act, 1999

10. Recovery and Distribution process
• With the support of the government and other regulatory agencies
brokers & trading clients under the supervision of High Court
appointed Committee (HCC), recovery from the “defaulters” can be
further expedited
• The without prejudice proposal assumes that all trading clients who
are approximately 13,000 in number are genuine. NSEL is in the
process of collecting data from trading clients to ascertain their
genuineness

11. If No solution provided by brokers or
trading clients
• Despite this proposal, if there are trading clients and Brokers who
do not come forward to a solution, then their only agenda is to kill
FTIL and the interest of FTIL’s 63,000+ shareholders

12. FTIL’s future course of action
• FTIL has stated that would continue defending all the allegations in
the court of law and will do so in the interest of its 63,000+
shareholders if the resolution is not acceptable to all parties
• FTIL will use all the legal means at its disposal to protect and create
value for its 63,0000+ shareholders by implementing its Founder’s
Vision for FTIL 3.0 - DigitalIndia@2025 to create / enable 108
‘Digital Disruptors’ in 10 core industry segments