DRAFT PROSPECTUS

LEMURIA TECHNOLOGIES LIMITED

(The company was incorporated on 18^th June, 1991 under the provisions of the Companies Act, 1956 as a Private Ltd Company under the name “Lemuria Technics Private Limited”. The name was changed to “Lemuria Technologies Private Limited vide special resolution passed at the Extra Ordinary General Meeting on 20^th April, 2000, subsequently it was converted into a public company vide special resolution passed at the Extra Ordinary General Meeting held on 15^th May, 2000 and a fresh certificate of incorporation consequent to the conversion was issued by the Registrar of Companies, Tamil Nadu on 22^nd May, 2000).

Registered Office: C-94, II Floor, Thillai Nagar Main Road, Trichy 620 018

Phone: (0431) 722149, E-mail: reginfo@lemuriatech.com

Corporate Office : New No.97, Harrington Road, Chennai-600 030

Phone : (044)6612761,Tele fax : (044) 6612753

E-mail : corp@lemuriatech.com. Website: www.lemuriatech.com

PUBLIC ISSUE OF 29,40,000 EQUITY SHARES OF RS.10/- EACH FOR CASH AT PAR AGGREGATING RS. 294.00 LAKHS.

RISKS IN RELATION TO THE FIRST ISSUE

This being the first public issue of the Equity Shares of the company, there has been no formal market for the securities of the company. The Issue price (as has been determined and justified by the lead manager and the issuer as stated under ‘Basis of Issue Price’) should not be taken to be indicative of the market price of the equity shares after the shares are listed. No assurance can be given regarding an active or sustained trading in the shares of the Company or regarding the price at which equity shares will be traded after listing

GENERAL RISKS

Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offering. For taking an investment decision investors must rely on their own examination of the issuer and the offer including the risks involved. The securities have not been recommended or approved by Securities and Exchange Board of India nor does Securities and Exchange Board of India guarantee the accuracy or adequacy of this document.

ISSUER'S ABSOLUTE RESPONSIBILITY

The issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Offer Document contains all information with regard to the issuer and the issue, which is material in the context of the issue, that the information contained in this offer document is true and correct in all material respects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

Investors are requested to refer page-- for the summarised and detailed statement of Risk Factors.

LISTING ARRANGEMENTS

The Equity Shares are proposed to be listed on the Stock Exchanges at Chennai, Ahmedabad and Hyderabad.

LEAD MANAGER TO THE ISSUE

ARYAMAN FINANCIAL SERVICES LTD.

(SEBI Regn. No.: INM 00000 6807)

35, Atlanta, 3^rd Floor, Nariman Point,

Mumbai – 400021.

Ph. : 2826465,2826466,2883134

Fax : 022-2826467

e-mail : aryaman@bom2.vsnl.net.in

REGISTRAR TO THE ISSUE

CAMEO CORPORATE SERVICES LTD.

(SEBI Regn.No.: INR 00000 3753)

Subramaniam Building,No1,

Club House Road,

Chennai – 600 002.

Ph: 8528390(5 lines)

Fax :044-8520129

Issue Opens On :

Issue Closes On :

Particulars	Page Nos.
Definition/ Abbreviations
Risk Factors and Management perceptions thereof
Highlights
PART – I
1. General Information
2. Issue Management Team
3. Capital Structure of the Company
4. Terms of the Present Issue
5. Particulars of the Issue
6. Company, Management and Project
7. Stock Market Data & Basis for Issue Price.
8. Outstanding Litigation. Disputes and defaults
9. Material Developments & Other matters
10. Risk factors & Management Perception thereof
PART – II
A. General Information
B. Financial Information
C. Statutory and Other Information
D. Main Provisions of the Articles of Association of the Company
E. Material Contracts and Documents for Inspection
PART – III
Declaration

ABBREVIATIONS USED IN THE PROSPECTUS

LTL / the Company / the Issuer	Lemuria Technologies Limited
ACT	The Companies Act, 1956
ARTICLES	Articles of Association of the Company
BOARD	Board of Directors of LTL
ECOM	Electronic Commerce
EPS	Earnings per share
GUI	Graphical user interface
ISP	Internet service provider
ISSUE	Public Issue of 29,40,000 Equity Shares of the Company
NAV	Net Assets Value
OS	Operating System
PAN	Permanent Account Number
RBI	Reserve Bank of India
RDBMS	Relational data base management system
ROC	Registrar of Companies
SEBI	The Securities and Exchange Board of India
USA	The United States of America

RISK FACTORS (R) & MANAGEMENT PERCEPTIONS (P)

INTERNAL

1. (R) The Company is yet to apply for the RBI Clearance for setting up a offices in Canada / Singapore for which a sum of Rs. 87.00 lakhs has been set apart in the project cost.

(P) The Company will make an application for setting up of offices in due course and is confident of getting the necessary sanctions as per schedule.

2. (R) This being the first major venture of the promoters, the project suffers from all risks being associated with such start-up ventures.

(P) The Company has started training and recruitment of quality software professionals with relevant background and experience and hence, no adverse impact on operations is foreseen.

3. (R) The cost of the project and means of finance has not been appraised by any banks/ financial institution and are based on the Company’s own estimates. The working capital requirement has also not been assessed by any bankers. The deployment of funds collected in this issue will be at the sole discretion of the management of the company.

(P) The Management of the Company has drawn out a business plan for the activities to be pursued in the software development area. The Company believes that it has professional expertise to assess the cost of project and implement the same.

4. (R) The company was incorporated in 1991 but commercial operation started after 1996.

5. (R) The courses imparted by Software Training Centre of the company under the name Toronto Software Technology are not accredited/ recognised by any University / Board / AICTE / Government authorities.

6. (R) The Registered office & the corporate office of the company is not in the name of the company and the same has been taken on rent.

(P) The terms and condition of the agreement are reasonable and in line with market practice.

7. ( R) The company is yet to place orders for its entire software requirement of Rs. 67.25 lacs

(P) The company has already received quotations from various parties and orders will be placed in due course of time.

8. (R ) The company is yet to identify the additional premises of 4200 sq. ft.

(P) The company is in the process of identifying the additional premises and the same shall be finalised shortly.

EXTERNAL

1. (R) Any adverse change in the Government fiscal policies may affect the performance and profitability of the Company.

(P) The Government policies for the software industry in particular are highly encouraging. Hence, the Company does not foresee any adverse policy changes that could be detrimental to the growth of this sector.

2. (R) Selection, Recruitment and Retention of skilled, good quality manpower are crucial factor for the success of a software company.

(P) The high degree of employee turnover would be minimised to a considerable extent through the Company’s sound Human Resources policies, which lay emphasis on continuous training and development on latest technologies for its personnel.

3. (R) The IT Industry is prone to high risk of Technological Obsolescence.

(P) The Company will setoff the technological obsolescence with continuous updating of the technical skills.

4. (R) The market for software services and products are highly competitive.

(P) The Company is confident that its novel products will find a suitable market in the highly competitive industry.

5. (R) Timely execution of projects has a critical bearing on the cash flows of software companies.

6. (R) Information Technology business in which the Company is engaged is witnessing abnormally high valuation presently and possibilities can not be ruled out that the same may be not continue in future.

HIGHLIGHTS

1. Existing, profit making, information Technology Company.

2. Company promoted by technocrats and software professionals engaged in Legacy systems, E-commerce and web applications .

3. Strategic alliance with Software Galaxy Systems, New Jersey, USA, Garimella System Search Inc., Toronto, Canada.

4. The company is owning B2B (2), B2C (2), information (1) and Job (1) portals.

5. Listing proposed at Chennai, Ahmedabad, and Hyderabad Stock exchanges.

NOTE :

INVESTORS MAY NOTE THAT IN CASE OF OVERSUBSCRIPTION ALLOTMENT SHALL BE ON PROPORTIONATE BASIS.

PART - I

LEMURIA TECHNOLOGIES LIMITED

Registered Office: C-94, II Floor, Thillai Nagar Main Road, Trichy 620 018

Phone: (0431) 722149, E-mail: reginfo@lemuriatech.com

Corporate Office : New No.97, Harrington Road, Chennai-600 030

Phone : (044)6612761,Tele fax : (044) 6612753

E-mail : corp@lemuriatech.com. Website: www.lemuriatech.com

PUBLIC ISSUE OF 29,40,000 EQUITY SHARES OF RS.10/- EACH FOR CASH AT PAR AGGREGATING RS. 294.00 LAKHS.

I. GENERAL INFORMATION

AUTHORITY FOR THE PRESENT ISSUE

Pursuant to Section 81(1A) of the Companies Act, 1956, the present issue of Equity Shares has been authorised vide Special Resolution passed at Extra Ordinary General Meeting held on 1st June, 2000 at the registered office of the Company.

GOVERNMENT APPROVALS

The Company can undertake the activities as proposed in the object of the issue. The Company would obtain the necessary approvals at the time of actual implementation. No further approvals from any authority are required by the Company to undertake the proposed activities, save and except those approvals, which may be required to be taken in the normal course of business from time to time.

DISCLAIMERS

SEBI Disclaimer Clause

It is to be distinctly understood that submission of offer documents to SEBI should not, in any way, be deemed or construed that the same has been cleared or approved by SEBI. SEBI does not take any responsibility either for the financial soundness of any scheme or the project for which the issue is proposed to be made, or for the correctness of the statements made or opinions expressed in the offer document. The Lead Manager, M/s Aryaman Financial Services Ltd has certified that the disclosures made in the offer document are generally adequate and are in conformity with SEBI Guidelines for Disclosures and Investor Protection in force for the time being. This requirement is to facilitate investors to take an informed decision for making investment in the proposed issue.

It should also be clearly understood that, while the issuer Company is primarily responsible for the correctness, adequacy and disclosure of all relevant information in the offer document, the Lead Manager is expected to exercise due diligence to ensure that the Company discharges its responsibility adequately in this behalf and towards this purpose, the Lead Manager, M/s Aryaman Financial Services Ltd., has furnished to SEBI a Due Diligence Certificate dated 29^th June, 2000 in accordance with SEBI (Merchant Bankers) Regulations, 1992, which reads as follows :-

i. We have examined various documents including those relating to litigation like commercial disputes, patent disputes, disputes with collaborators etc., and other materials in connection with the finalisation of the draft prospectus pertaining to the said issue;

ii. On the basis of such examination and the discussion with the Company, its directors and other officers, other agencies, independent verification of the statements concerning objects of the issue, projected profitability, price justification and the contents of the documents and other materials furnished by the Company,

WE CONFIRM THAT :-

a. The offer document forwarded to SEBI is in conformity with the documents, materials and papers relevant to the issue.

b. All the legal requirements connected with the said issue as also the guidelines, instructions etc., issued by SEBI, the Government and any other competent authority in this behalf have been duly complied with; and

c. The disclosures made in the offer document are true, fair and adequate to enable the investors to make a well-informed decision as to the investment in the proposed issue.

iii. We confirm that besides ourselves, all the intermediaries named in the prospectus are registered with SEBI and that till date such registration is valid.

iv. We have satisfied ourselves about the worth of the underwriters to fulfil their underwriting commitments.

v. We certify that written consent from shareholders has been obtained for inclusion of their securities as part of promoters’ contribution subject to lock-in and the securities proposed to form part of promoters’ contribution subject to lock-in, will not be disposed / sold / transferred by the promoters during the period starting from the date of filing the draft prospectus with the board till the date of commencement of lock-in period as stated in the draft prospectus.

The filing of Offer Document does not, however, absolve the Company from any liabilities under section 63 of the Companies Act, 1956 or from the requirement of obtaining such statutory or other clearances as may be required for the purpose of the proposed issue. SEBI, further reserves the right to take up, at any point of time, with the Lead Manager(s) (Merchant Bankers) any irregularities or lapses in offer document.

DISCLAIMER OF THE STOCK EXCHANGE

The regional Stock Exchange i.e Madras Stock Exchange Ltd., Chennai, the Stock Exchange Ahmedabad, and Hyderabad have scrutinised this prospectus for its limited internal purpose of deciding on the matter of granting the aforesaid permission to this Company. The Exchanges does not in any manner –

a. warrant, certify or endorse the correctness or completeness of any of the contents of this prospectus, or

b. warrant that the Company's securities will be listed or will continue to be listed on the respective Exchange, or

c. take any responsibility for the financial or other soundness of this Company, its promoters, its management or any scheme or project of this Company.

and it should not, for any reason, be deemed or construed that this prospectus has been cleared or approved by the Exchange. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to independent inquiry,` investigation and analysis and shall not have any claim against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever.

DISCLAIMER IN RESPECT OF JURISDICTION

This issue is made in India to persons resident in India. This prospectus does not, however constitute an Issue to sell or an invitation to subscribe to shares issued hereby in any other jurisdiction to any person to whom it is unlawful to make an Issue or invitation to such jurisdiction. Any person into whose possession this prospectus comes is required to inform himself about and to observe any such restrictions. Any disputes arising out of this Issue will be subject to the jurisdiction of appropriate Courts.

GENERAL DISCLAIMER

It should be noted that the Company accepts no responsibility for statements made otherwise than in the offer document or in the advertisements or any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at his/her own risk.

The Promoters/ directors declare and confirm that no information/ material likely to have a bearing on the decision of investors in respect of the shares offered in terms of this prospectus has been suppressed with held and / or incorporated in the manner that would amount to mis- statement / misrepresentation and in the event of its transpiring at any point of time till allotment/ refund, as the case be, that any information/ material has been suppressed/ with held and / or amounts to a mis-statement/ mis-representation, the promoters/ directors undertake to refund the entire application monies to all the subscribers within 7 days thereafter without prejudice to the provisions of section 63 of the Companies Act.

FILING

A copy of this prospectus having attached thereto, the documents required to be filed under Section 60 of the Companies Act, 1956 has been delivered for registration to the Registrar of Companies, Tamilnadu at Chennai.

A copy of the prospectus has also been filed with SEBI, Chennai.

A copy of the documents referred to elsewhere in the prospectus has been kept open for public inspection at the Registered Office of the Company.

LISTING

Initial listing applications have been made to Madras Stock Exchanges Ltd., Chennai ( the regional stock exchange) and the Stock Exchange, Ahmedabad, and Hyderabad for permission to deal in and for an official quotation of the equity shares now being issued in terms of this Prospectus and for the existing equity shares of the Company.

In case the permission to deal in and for official quotation of the shares is not granted by the Stock Exchanges, the Issuer shall forthwith repay without interest, all monies received from applicants in pursuance of this Offer Document and if such money is not repaid within 8 days after the day from which the Issuer is liable to repay it, the Issuer shall pay interest as prescribed under Section 73(2) of the Act.

UNDERTAKING FROM PROMOTERS AND DIRECTORS

The Issuer accepts full responsibility for the accuracy of the information given in this prospectus and confirms that to the best of their knowledge and belief, there are no other facts, the omission of which make any statement in this Offer Document misleading and they further confirm that they have made all reasonable inquiries to ascertain such facts. The Issuer further declares that the Stock Exchanges to which an application for official quotation is proposed to be made do not take any responsibility for the financial soundness of this offer or for the price at which the Equity Shares are offered or for the correctness of the statements made or opinions expressed in this Offer Document.

CAUTION

Attention of the applicants is specifically drawn to subsection (1) of Section 68-A of the Act, which is reproduced below :-

"Any person who –

a. makes in a fictitious name, an application to a Company for acquiring, or subscribing for, any shares therein, or

b. otherwise induces a Company to allot or register any transfer of shares therein to him, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years."

ISSUER COMPANY ACCEPTS NO RESPONSIBILITY FOR STATEMENTS MADE OTHERWISE THAN IN THE PROSPECTUS OR IN THE ADVERTISEMENT OR ANY OTHER MATERIAL ISSUED BY OR IN THE INSTANCE OF THE ISSUER AND THAT ANY ONE PLACING RELIANCE ON ANY OTHER SOURCE OF INFORMATION WOULD BE DOING SO AT HIS OWN RISK.

MINIMUM SUBSCRIPTION

IF THE COMPANY DOES NOT RECEIVE THE MINIMUM SUBSCRIPTION OF 90% OF THE ISSUED AMOUNT, ON THE DATE OF CLOSURE OF THE ISSUE OR IF THE SUBSCRIPTION LEVEL FALLS BELOW 90% AFTER THE CLOSURE OF THE ISSUE ON ACCOUNT OF CHEQUE HAVING BEEN RETURNED UNPAID OR WITHDRAWAL OF APPLICATIONS, THE COMPANY SHALL FORTHWITH REFUND THE ENTIRE SUBSCRIPTION AMOUNT RECEIVED. IF THERE IS A DELAY BEYOND 8 DAYS AFTER THE COMPANY BECOMES LIABLE TO PAY THE AMOUNT, THE COMPANY SHALL PAY INTEREST AS PER SECTION 73 OF THE COMPANIES ACT, 1956.

SHARE CERTIFICATES/ALLOTMENT LETTERS/REFUND ORDERS

Letter(s) of Allotment / Share Certificate(s) together with refund orders of value over Rs. 1,500/-, if any, to allottees and Letter(s) of Regret together with refund orders of value over Rs. 1,500/- to non-allottees will be dispatched by registered post and refunds of value Rs. 1,500/- and less will be dispatched under certificate of posting at the applicant's sole risk within 10 weeks from the date of closure of the subscription list.

Adequate funds for the above purpose will be made available to the Registrar to the issue to ensure dispatch of refund orders, allotment letters and share certificates by Registered Post/Certificate of Posting.

The Company agrees that –

a. as far as possible allotment of securities offered to the public shall be made within 30 days of the closure of the public issue.

b. it shall pay interest @ 15% per annum if the allotment has not been made and the refund orders are not dispatched to the investors within 30 days from the date of closure of the issue.

ISSUE PROGRAMME

The subscription list will open at the commencement of banking hours and will close at the close of banking hours on the dates as mentioned below :-

ISSUE OPENS ON
ISSUE CLOSES ON

II. ISSUE MANAGEMENT TEAM

LEAD MANAGER TO THE ISSUE

ARYAMAN FINANCIAL SERVICES LTD.

(SEBI Regn. No.: INM 00000 6807)

35, Atlanta, 3^rd Floor, Nariman Point,

Mumbai – 400021.

Ph. : 2826465,2826466,2883134

Fax : 022-2826467

e-mail : aryaman@bom2.vsnl.net.in

REGISTRAR TO THE ISSUE

CAMEO CORPORATE SERVICES LTD.

(SEBI Regn.No.: INR 00000 3753)

Subramaniam Building,No1,

Club House Road,

Chennai – 600 002.

Ph: 8528390(5 lines)

Fax :044-8520129

COMPANY SECRETARY

The Company has not appointed a Company Secretary as required U/s 383A of the Companies Act, 1956. However, the Company is in the process of appointing a Company Secretary.

COMPLIANCE OFFICER

Mr. Raja

LEMURIA TECHNOLOGIES LIMITED

97, Harrington Road, Chennai-600 030

Phone : (044)6612753

Email : compliance@lemuriatech.com

Investors may contact the aforesaid compliance officer in case of any pre-issue /post issue related problems such as non–receipt of letters of allotment/ share certificates/ refund orders/ cancelled stock invests, etc.

AUDITORS

N.A.Ramachandran & Co

Chartered Accountant

7/3 Madley Road, T.Nagar, Chennai – 600 017

Ph.: (044) 4347338

LEGAL ADVISOR TO THE COMPANY

K. Pandurangan

Madras High Court Advocates Association

High Court Building, Chennai - 600 001

Ph.: (044) 534 1646

BANKERS TO THE COMPANY

INDIAN BANK

Kilpauk Branch,

10, New Avadi Road, Chennai – 600 010

UNDERWRITERS TO THE ISSUE

Underwriting being optional, the Company does not propose to underwrite the issue.

CREDIT RATING

As the issue is of equity shares, credit rating is not required.

TRUSTEES

Since the proposed issue is of equity shares only, trustee is not required to be appointed.

BANKERS TO THE ISSUE

III. CAPITAL STRUCTURE OF THE COMPANY

	PARTICULARS	NOMINAL VALUE (RS.)
(A)	AUTHORISED
67,50,000	Equity Shares of Rs.10/- each	6,75,00,000
(B)	ISSUED, SUBSCRIBED AND PAID-UP
31,33,200	Equity Shares of Rs.10/- each for cash at par	3,13,32,000
(C)	PRESENT ISSUE
29,40,000	Equity Shares of Rs.10/- each for cash at par	2,94,00,000
(D)	PAID UP CAPITAL AFTER THE PRESENT ISSUE
60,73,200	Equity shares of Rs.10/- each fully paid up	6,07,32,000

In view of the proportionate Basis of Allotment in the event of over-subscription, to ensure Allotment in marketable lots (in terms of SEBI RMB (DIP Series) Guidelines 2000, the Company will make such adjustments in the basis of Allotment as may be necessary in consultation with the Regional Stock Exchange / Securities and Exchange Board of India and consequently the allotment may go up by a maximum of 10% of the Net offer to the public as a result of which the post issue paid up capital after the issue would also increase by the excess amount of allotment so made. In such an event, the shares held by the promoters and subjected to lock in, shall be suitably altered, so as to ensure that 20% of the ultimate post issue capital is locked in.

NOTES :-

a. Promoters and associates presently hold 100 % of the share capital of the company. The promoters holding after the issue will be 51.58 %

b. Share Capital History

i) The details of share capital allotted by the Company is as follows :-

Sr	Date of Allotment	Date when made fully paid up	Consid- Eration	No. of Shares	Face Value	Issue Price	%age of Post Issue Capital	Lock in Period
1	Subscribers to the memorandum	18.06.91	Cash	200	10/-	10/-	Negligible
2	10.03.97	10.03.97	Cash	1218000	10/-	10/-	20.05
3	06.05.99	06.05.99	Cash	687000	10/-	10/-	11.31
4	06.05.99	06.05.99	Cash	668000	10/-	10/-	11.00	3 years
5	15.06.00	15.06.00	Cash	560000	10/-	10/-	9.22	3 years
			TOTAL	3133200			51.58

The lock in period shall commence from the date of allotment of shares in the public issue or the date of commencement of the expansion project as stated in the prospectus (i.e) on October 2000, whichever is later.

The equity shares held by the promoters under the lock in period, shall not be sold/ hypothecated/ transferred during the lock in period. However, inter se transfers between the promoters named as such would be permitted, provided that the requirement of the lock in period guidelines continue to apply, to the extent initially prescribed.

ii) The details of contribution and lock in respect of promoters whose name appear in the paragraph “ Promoters and their Background” are as follows :-

Name of the promoters	Date of Allotment	Date when made fully paid up	Consid Eration	No.of Shares	Face Value	Issue Price	%age of Post Issue Capital	Lock in Period
K.Ashok	Subscriber to Memorandum		Cash	100	10	10	Negligible
	10.03.1997	10.03.1997	Cash	1200000	10	10	19.75%
K.Kumarguru	Subscriber to Memorandum		Cash	100	10	10	Negligible
	10.03.1997	10.03.1997	Cash	18000	10	10	0.31%
	06.05.1999	06.05.1999	Cash	850000	10	10	14.00%	*

* Out of the above 14.00% shares held by Mr. Kumaragurau, 11.00% shares would be locked in for a period of 3 years

c. The Company was incorporated with an Authorised Capital of Rs. 5.00 Lakhs divided into 50000 equity shares of Rs. 10/-each. The Authorised Share Capital of the Company has been increased from Rs 5.00.Lakhs to Rs125.Lakhs divided into 12,50,000 Equity shares of Rs.10/- each through an amendment to the Memorandum and Articles of Association by a resolution passed at the Company’s EGM held on 10.03.1997. The Authorised share capital of the company further increased from Rs 125 lacs to Rs 275 lacs vide an amendment to the Memorandum and Articles of Association by a resolution passed at the Company’s AGM held on 06.05.1999. The authorised share capital of the company was further increased from Rs 275 lacs to Rs 675 lacs vide an amendment to the Memorandum and Articles of Association by a resolution passed at the Company’s EGM held on 25.05.2000.

d. Particulars of top ten shareholders two years prior to the date of filing of offer document with ROC :-

Sr. No.	Name	No. of Shares

e. Particulars of top ten shareholders as on 10 days before the date of filing of offer document with ROC :-

Sr. No.	Name	No. of Shares
1
2
3
4
5
6
7
8
9
10

f. Particulars of top ten shareholders as on date of filing of offer document with ROC :-

Sr. No.	Name	No. of shares
1
2
3
4
5
6
7
8
9
10

g. The shareholding pattern of the Company as on and the likely shareholding pattern after allotment of equity shares in the issue is as follows :-

Particulars	Existing		After the issue
	No.( Shares)	%	No. ( shares)	%
Core Promoters Relatives & Friends	2068200 1065000	66.01 33.99	2068200 1065000	34.05 17.54
Public	----------	-------	2940000	48.41
Total	3133200	100.00	6073200	100.00

h. Commitment of Issue of Shares in Future :-

The Shareholders of the Company do not hold any warrant, options, convertible loan or any debenture which would entitle them to acquire further shares of the Company.

i. Details of sale/purchase/financing of shares by Promoters/Directors.

The Promoters Group / Directors have not purchased and or sold/financed any shares of the Company during the past six months. The Promoters, Directors and Lead Merchant Banker of the Issue have not entered into any buy-back or "similar" arrangement for the securities being issued through this Offer Document.

j. Bridge Loans.

There are no "Bridge loans" and expenses on the project are being incurred from subscription brought in by the Promoters.

k. In terms of SEBI clarification No VIII, a minimum of 50% of the net Issue to the Public shall be made available for Allotment to individual applicants who have applied for 1000 or less than 1000 Shares. The balance 50% of the net Issue to the public shall be made available for Allotment to investors including corporate bodies / institutions and individual applications who have applied for more than 1000 Shares. The un-subscribed portion of the net Issue to any one of the above categories shall be made available for allocations in other categories, if so required.

a. The un-subscribed portion of the net offer to any one of these categories specified shall/may be made available for allotment to applicants in the other category, if so required.

b. As the basis of allotment is on proportionate basis, in the process of rounding off to the nearest multiple of 100, the offer size may increase by a maximum of 10% of the present offer.

l. No single applicant can make an application for number of securities, which exceeds the securities offered.

m. The Company has not revalued its assets since inception.

n. No payment direct or indirect in the nature of discount, commission, allowance or otherwise shall be made either by the issuer company or the promoters to the persons who receive firm allotment in the public issue.

o. Total number of shareholders are 48 as on 15^th June, 2000.

IV. TERMS OF THE PRESENT ISSUE

PRINCIPLE TERMS AND CONDITIONS OF THE ISSUE

The Equity Shares being issued are subject to the terms of this Prospectus, the terms and conditions contained in the Application Form, the Memorandum and Articles of Association of the Company, provisions of the Act, other applicable acts and the Letters of Allotment / Equity Shares Certificates or other documents and the Guidelines issued from time to time by the Government of India and SEBI.

AUTHORITY FOR THE PRESENT ISSUE

Pursuant to Section 81 (1A) of the Act, the present issue of Equity Shares has been authorised by the Shareholders of the Company by a Special Resolution passed at the Extra Ordinary General Meeting of the Company held on 1st June, 2000.

DESCRIPTION OF THE INSTRUMENT

Face Value : The face value of the Equity Shares will be Rs.10 per share.

Offer Price : The Equity Shares are being offered at a price of Rs.10 per share at par.

TRADABLE LOT

The tradable lot of equity shares of the Company is 100.

Terms of Payment :-

Applications should be for minimum of 200 equity shares and in multiples of 100 equity shares thereafter. The amount payable on application on the equity shares by different class of investors are as under :-

Indian Public – at Rs. 10 per share

Category	(Rs.)
On application	5.00
On allotment	5.00
Total	10.00

Where an applicant is allotted lesser number of equity shares than he / she has applied for, the excess amount paid on application shall be adjusted towards the amount due on allotment and the balance amount, if any will be refunded to the applicant. No interest would be payable on application money pending allotment up to 30 days from the date of closure of the issue.

ALLOTMENT MONEY

Failure to pay the amount due on allotment on or before the appointed date for payment thereon will render the allottee liable to pay interest at the rate of 15% per annum or such other lower rate as the Board of Directors may determine on the amount outstanding from the date so appointed for payment thereof to the time of actual payment and will also render the equity shares including the amount already paid thereon liable for forfeiture in terms of the Articles of Association of the Company.

RANKING OF EQUITY SHARES

The Equity Shares to be issued shall be subject to the Memorandum and Articles of Association of the Company and shall rank pari passu with the existing Equity Shares of the Company save and except that they shall rank for dividend, if any, which may be declared, pro-rata for the period from the date the new Equity Shares are allotted.

INTEREST IN CASE OF DELAY IN DESPATCH OF ALLOTMENT REFUND ORDERS

a) As far as possible, allotment of securities offered to the public shall be made within 30 days of the closure of this offer.

b) The issuer shall pay interest @ 15% p.a. if the allotment letters / refund orders have not been dispatched to the applicants within 30 days from the date of the closure of issue (except to applying through stock-invest).

RIGHTS OF MEMBERS

1. Right to receive dividend if declared.

2. Right to attend general meeting and exercise voting rights unless prohibited by law.

3. Right to vote either personally or by proxy.

4. Right to receive offer for rights shares and be allotted bonus shares.

5. Right to receive surplus on liquidation.

INSTRUCTIONS FOR APPLICANTS

Availability of Application Form & Prospectus :

Application forms together with Memorandum containing salient features of the Prospectus may be obtained from the Registered Office of the Company, Lead Manager, Registrar to the Issue and Bankers to the Issue named herein or from their branches as stated on the reverse of the application form. Any individual desiring to have a full copy of the Prospectus may write to the Lead Manager or to the Registered Office or Corporate Office of the Company.

Who can apply :

Applications may be made by:

1. Indian nationals resident in India who are not minor, in single or joint names (not more than three)

2. Hindu Undivided Families in the individual name of the Karta.

3. Companies, Corporate bodies and Societies registered under the applicable law in India and authorised to invest in the shares.

4. Indian Mutual Funds registered with SEBI, Indian Financial Institution, Commercial Banks and Regional Rural Banks, Co-operative Banks may also apply subject to permission from RBI.

PROCEDURE FOR APPLICATION

Application by Resident Indian Public

Application must be :

a. Made only in the prescribed application form accompanying the memorandum.

b. Completed in full in block letters in English except signatures in accordance with the instructions contained herein and in the application form. Applications not so made are liable to be rejected.

c. For a minimum of 200 equity shares and in multiples of 100 thereafter

d. In the name of Resident Indian Individuals, limited companies, statutory corporations/institutions incorporated in India, Indian Mutual Funds registered with SEBI and Banks. Applications in the name of minors, foreign nationals, Trusts not registered under the Societies Registration Act, 1860, or any other Trust laws, partnership firms or their nominees will be treated as invalid.

e. Applicants residing at places where no collection centers have been opened may submit / mail their applications at their sole risk along with application money due there unto by Demand Draft to the Registrar to the Issue, Cameo Corporate Services Ltd. superscribing the envelope "LEMURIA TECHNOLOGIES LIMITED- Public Issue " so as to reach the Registrar on or before the closure of the Subscription List. Such demand drafts should be payable at Chennai only. The charges, if any, for purchase of the demand draft will have to be borne by the applicant.

f. Application by Mutual Funds / Indian Financial Institutions / Banks / Investment Institutions: A separate application can be made in respect of each scheme of an Indian Mutual Fund registered with SEBI and such applications will not be treated as multiple applications provided the applications made by the AMCs / Trustees / the Custodians clearly indicate their intention as to each Scheme concerned for which application has been made.

g. All cheques / bank drafts accompanying the application should be crossed " A/c payee only" and made payable to any of the Bankers to the Issue and lodged at any of their nominated branches and should bear the words "LEMURIA TECHNOLOGIES LIMITED - Public Issue".

h. All stockinvests should be crossed "A/c payee only" and "Non negotiable" and be made payable to the Issuer Company. Only individuals and mutual funds are entitled to use stock invest.

i. Applicants should indicate the application numbers on the reverse of the instrument through which the payment is made.

NOMINATION FACILITY TO INVESTOR

The applicant may indicate the name of the nominee in respect of the shares that may be allotted to him. As per section 109 A of the Companies Act, 1956, a holder of shares may, at any time, nominate, in the prescribed manner, a person to whom his share in the Company shall vest in the event of his death.

INSTRUCTIONS FOR PAYMENT:

Payments should be made in cash or cheque or demand draft or Stockinvest drawn on any Bank (including a Co-operative Bank) which is situated at and is a member or a sub-member of the Bankers’ "Clearing House" located at the Centers (indicated in the Application Form) where the Application is accepted. A Separate cheque / demand draft / stockinvest should accompany each Application. Money orders, postal orders, outstation cheques or demand drafts, cheques / draft drawn on banks not participating in the "clearing" will not be accepted and applications accompanied with such instruments may be rejected.

In case payment is effected in contravention of the conditions mentioned herein, the application money will be refunded and no interest will be paid thereon.

APPLICATION(S) WILL NOT BE ACCEPTED BY THE LEAD MANAGERS OR REGISTRAR TO THE ISSUE

APPLICATION BY WAY OF STOCKINVEST:

The applicant being an individual or Mutual Fund only has the option to use stockinvest for applying for Equity Shares now offered in terms of this Prospectus. Stockinvest can be obtained from any Bank issuing such instrument in various denominations by making the necessary applications and depositing the amounts with the respective banks. The applicant using the Stockinvest should submit the application form to any of the Bankers to the Issue before closing of the subscription list along with the Stockinvest after filling in the appropriate amount.

The applicant may approach the issuing bank for issue of Stockinvest of required denomination (s) for payment of application money.

1. The prospective investor, at the time of request for issue of Stockinvest to the issuing bank may have to :-

a. Indicate the he agrees to abide by the terms of issue and encashment of the Stockinvest.

b. Give irrevocable authority to his bank to mark a lien for the value of the Stockinvest against the balance in his savings / current / other deposit account.

c. Agree that the issuing bank will not be liable for any damage or consequences arising out of the loss of these instruments.

2. Banker’s lien on the applicant’s deposit account will be automatically lifted when-

a. A valid instrument is presented by the Controlling Branch of the Collecting Bank.

b. The cancelled Stock invest is surrendered by the applicant or applicant has not received the advise of allotment.

c. On execution of an indemnity bond in favour of the bank after the expiry of the validity period (i.e. 4 months) of the Stockinvest.

3. The Stockinvest should bear "Account Payee" and "Non-Negotiable" crossing and will be payable only to the account of the Issuer Company. i. e. "LEMURIA TECHNOLOGIES LIMITED" Stockinvest should be utilised by the purchaser(s) and the purchaser’s name / name of one of the purchasers should be invariably indicated as the first applicant in the application form. Thus if the signature of the purchaser on the Stockinvest and the signature of the first applicant on the application form does not tally, the application would be treated as having been accompanied by a third party Stockinvest and is liable for rejection.

4. Stockinvests are to be used by the purchaser(s) within 10 days of its issue and for this purpose the last day for use of the Stockinvest for submitting application to the Bankers to the Issue should be indicated on the face of the Stock invest with a notation "To be used before "

5. The Stockinvest will be issued to the applicant in blank format after authentication of the date of issue by the designated branch. The Stockinvest duly completed should be submitted along with the application form to the Bankers to the Issue.

6. No return will be made to those applicants using Stockinvest for payment of application money.

7. In case of non-allotment of Equity Shares, the cancelled Stockinvest instrument will be returned to the applicant, who will have to approach the issuing bank branch for lifting of lien.

8. A ceiling of Rs. 50,000/- per individual per capital issue has been imposed by banks for issue of Stockinvest and these ceiling will not be applicable to Mutual Funds

Application with Stockinvest not fulfilling the above criteria are liable to be rejected.

The application using Stockinvest should submit the Application Form along with the instrument to any of the Bankers to the Issue or their branches mentioned in the Application Form. The Stockinvest instruments are payable at par at all the branches of the issuing bank and as such outstation Stockinvest instruments can be also be attached to the Application Form, if the issuing Bank has a branch at the place of submitting the application.

The applicant has to fill in the following particulars :-

1. Title of the account i.e. "LEMURIA TECHNOLOGIES LIMITED"

2. The number of Equity Shares applied for,

3. The amount payable on the Equity Shares applied for,

4. The name and address where the Stockinvest should be returned in case of non-allotment.

The application number on the reverse of the instrument. The instrument should thereafter be signed by the applicant. Service charges, if any, for issuing Stockinvest must be borne by the applicant.

The applicant should not fill in the portion to be filed up by the Registrar to the Issue (right hand portion of the instrument). The Registrar to the Issue will fill up the right hand portion of the Stockinvest indicating the equity shares allotted to the applicant and also the amount calculated as follows:

a. In case of full allotment, the number of equity shares and the amount on the right hand side will be the same as the left-hand side of the instrument.

b. In case of partial allotment, the number and the amount after adjusting allotment money, if any, payable in respect of equity shares so allotted, filled up by the Registrar (on the right hand side of the instrument) will be less than or equal to the number and the amount filled up by the applicant (on the left hand side of the instrument).

c. In case the allotment in nil, the number and the amount filled up by the Registrar on the right hand side of the instrument will be nil.

THE APPLICANTS MAY APPROACH THE BANK CONCERNED FOR OBTAINING STOCKINVEST AND DETAILED INSTRUCTIONS FOR THE SAME.

THE ABOVE INFORMATION IS GIVEN FOR THE BENEFIT OF THE INVESTORS AND THE COMPANY IS NOT LIABLE FOR ANY MODIFICATION OF THE TERMS OF STOCKINVEST OR PROCEDURE THEREOF BY ISSUING BANK.

Inquiries relating to Stockinvest may be addressed only to the Registrar to the Issue and not to the issuing bank. Registrar to the Issue have been authorised by the Company vide a Board Resolution passed on 01/06/2000 to sign on behalf of the Company for realising the proceeds of the Stockinvest of the successful allottees or to affix non-allotment advice on the instrument or to cancel the Stockinvest of the non-allottees. The cancelled instrument shall be sent back by the Registrar to the Investor directly.

DISPOSAL OF APPLICATION MADE BY STOCKINVEST :

The procedure for disposal of applications made by cash/cheque/demand draft will apply mutatis mutandis to Stockinvest except the following:

a. In case of non-allotment, stockinvest will be cancelled by the Registrar to the Issue and returned to the applicant.

b. In case of allotment / partial allotment, the Registrar to the Issue shall fill in the amount in the stockinvest which would be less than or equal to the amount filled by the investor and present the stockinvest duly discharged on behalf of the Company for collection.

c. In case the cancelled stockinvest is not received by the investor from the Registrar, lien will be lifted by the issuing branch on expiry of four months from the date of issue against an indemnity bond from the applicant.

d. Inquiries relating to stockinvest may be addressed to the Registrar and not to the issuing bank.

e. Multiple applications under a stockinvest are liable to be rejected as each application is required to be accompanied by a separate instrument.

DISPATCH OF REFUND ORDERS

The Company ensures dispatch of refund orders of value over Rs. 1500/- and share certificates by registered post only and adequate funds for the purpose shall be made available to the Registrar by the Company.

UNDERTAKING BY THE ISSUER COMPANY

The Issuer Company accepts that :-

a. the complaints received in respect of the Issue shall be attended to by the issuer company expeditiously and satisfactorily,

b. the company shall take necessary steps for the purpose of getting the securities listed in the concerned stock exchange within specified time,

c. the funds required for dispatch of refund orders / allotment letters / certificates by registered post shall be made available to the Registrar to the Issue by the issuer company,

d. the promoters’ contribution in full , wherever required, shall be brought in advance before the Issue Opens for public subscription and the balance, if any, shall be brought in pro rata basis before the calls are made on public,

e. no further issue of securities shall be made till the securities offered through this offer document are listed or till the application moneys are refunded on account of non-listing, under subscription, etc.

FURTHER the issuers accept full responsibility for the accuracy of the information given in this offer document and confirm that to the best of their knowledge and belief, there are no other facts the omission of which make any statement in this offer document misleading, and they further confirm that they have made all reasonable inquiries to ascertain such facts.

UTILISATION OF OFFER PROCEEDS

The Board of Directors certifies that :-

a. All monies received out of the issue of shares to the public shall be transferred to a separate Bank account other than the Bank account referred to in sub-section (3) of Section 73 of Companies Act, 1956.

b. Details of all monies utilised out of this issue referred to in item (a) shall be disclosed under an appropriate separate head in the Annual Report of the Company indicating the purpose for which such monies had been utilised; and

c. Details of all unutilised monies out of this issue of shares, if any referred to in item (a) shall be disclosed under an appropriate separate head in the Annual Report of the Company indicating the form in which such unutilised monies have been invested.

DISPOSAL OF APPLICATION AND APPLICATION MONEY:

No receipt will be issued for application money. However, the Bankers to the issue receiving the application will acknowledge the receipt of the application by stamping and returning the detachable acknowledgment slip appended to each application.

The sum received in respect of the issue will be kept in separate bank accounts and the Company will not have any access to the funds unless approval of the regional Stock Exchanges i.e. the Stock Exchanges, Chennai is obtained for the basis of allotment and listing approval from the Stock Exchanges where listing is proposed.

The Company reserves the full unqualified and absolute right to accept or reject any application in whole or part and in either case without assigning any reason thereof.

BASIS OF ALLOTMENT

In the event of the public offer of equity shares being oversubscribed, the basis of allotment will be finalised in consultation with the Executive Director/Managing Director of the Regional Stock Exchange, Chennai along with the Lead Managers and Registrar to the Issue.

The basis of allotment will be made in the following manner :

a. A minimum of 50% of the net offer to the Indian public shall initially be made available for allotment in favour of those individual applicants who have applied for 1000 Equity Shares or Less.

b. The balance of net offer to the Indian public shall be made available to investors, including corporate bodies/institutions and individual applicants who have applied for more than 1000 Equity Shares.

c. The unsubscribe portion of the net offer to any of the categories specified in (a) or (b) shall be made available for allotment to applicants in the other category, if so required.

The allotment will be in marketable lots on a proportionate basis as explained below :-

a. Applicants will be categorised according to the number of equity shares applied for.

b. The total number of equity shares to be allotted to each category as a whole shall be arrived at on a proportionate basis i.e. the total number of equity shares applied for in that category (number of applicants in the category x number of equity shares applied for) multiplied by the inverse of the over subscription ratio.

c. Number of equity shares to be allotted to the successful applicants will be arrived at on a proportionate basis i.e. total number of equity shares applied for by each applicant in that category multiplied by the inverse of the over subscription ratio.

d. In all the applications where the proportionate allotment works out to less than 100 equity shares per applicant the allotment shall be made as follows:

· Each successful applicant shall be allotted a minimum of 100 equity shares; and

· The successful applicants out of the total applicants for that category shall be determined by draw of lots in such a manner that the total number of equity shares allotted in that category is equal to the number of equity shares worked out as per (b) above.

e. If the proportionate allotment to an applicant works out to a number that is more than 100 but is not a multiple of 100 (which is the marketable lot), the number in excess of the multiple of 100 would be rounded off to the higher multiple of 100 if that number is 50 or higher. If that number is lower than 50, it would be rounded off to the lower multiple of 100. All applicants in such categories would be allotted equity shares arrived at after such rounding off. If the process of rounding off to the nearest multiple of 100 results in the actual allotment being higher than the equity shares issued, India Images may allot additional equity shares up to a maximum of 10 % of the size of the offer.

f. If the shares allocated on a proportionate basis to any category is more than the shares allotted to the applicants in the category, the balance available shares for allotment shall be first adjusted against any other category where the allotted shares are not sufficient for proportionate allotment to the successful applicants in that category. The balance shares If any, remaining after such adjustment will be added to the category comprising of applicants applying for minimum number of shares.

OVER SUBSCRIPTION

In the event of over subscription, the Executive Director/ Managing Director of the Madras Stock Exchange ( Regional stock Exchange) along with the Lead Manager to the Issue and the Registrar to the Issue shall be responsible to ensure that the basis of allotment is finalised in fair and proper manner.

GENERAL INFORMATION

1. Joint Applications:

An application may be made in single or joint names (not more than three) as mentioned elsewhere in the prospectus. In case of a joint application, refund pay order (if any) and dividend / warrants, etc. will be made out in favour of the first applicant.

All communications will be addressed to the applicant whose name appears first and will be dispatched to the first applicant’s address stated in the application form.

2. Multiple Applications:

An applicant should submit only one application (and not more than one) for the total number of equity shares required. Applications may be made in single or joint names (not more than three). Two or more applications, in single and / or in joint names will be deemed to be multiple application if the sole and / or first applicant is one and the same.

3. Application under Power of Attorney:

In case of applications under a Power of Attorney or by limited companies or bodies corporate or societies, the relevant Power of Attorney or the relevant resolution or authority to make the application, as the case may be, together with a certified true copy thereof along with a copy of Memorandum and Articles of Association and /or bye-laws must be attached to the Application Form at the time of making the application or lodged for scrutiny separately indicating the Serial No. of the Application Form with the Registrar to the Issue at their Chennai address, within 10 days from the closure of the Issue. Failing which, the Issuer reserve the full, unqualified and absolute right to accept or reject any application in whole or in part and in either case without assigning any reason thereof.

4. Thumb impression or signature in language other than English, Hindi or any other language specified in the 8th Schedule of the Constitution of India must be attested by Magistrate or Notary Public or a special Executive Magistrate under his official seal.

5. All communications should be addressed to the Registrar to the Issue.

6. The applicant should mention the Application Form number on the reverse of the instrument through which payment is made.

7. Applicants are advised that it is mandatory for them to indicate in the space provided in the application form, details regarding their Savings Bank / Current Account Numbers and the name of the branch of the bank to which they want the proceeds of refund to be credited. Applications not containing such details are liable to be rejected.

8. Where an application is for allotment of equity shares for a total value of Rs. 50,000 or more i.e. the total number of securities applied for multiplied by the Issue price is Rs. 50,000/- or more, the applicant or in the case of applicants in joint names, each of the applicants should mention his permanent account number allotted under the Income Tax Act, 1961 or where the same has not been allotted, the GIR number and the Income Tax Circle / Ward / District should be mentioned. In case where neither the permanent account number nor the GIR number has been allotted, the fact of non allotment should be mentioned in the application form. Application forms without this information will be considered incomplete and will be liable to be rejected.

Having regard to provisions of Section 269SS of the Income Tax Act, 1961, the subscription against the equity shares application for an amount of Rs. 20,000 or more should not be effected t in cash and must be offered only by an A/c. payee cheque / bank draft / Stockinvest. In case payment is effected in contravention of the provisions, the application is liable to be rejected and application money will be refunded without interest.

A separate cheque / stockinvest/ bank draft must accompany each application form.

AS PER SEBI GUIDELINES DATED 16^TH FEBRUERY,2000, IT HAS BEEN DECIDED THAT , TRADING IN SECURITIES OF COMPANIES MAKING AN INITIAL OFFER SHALL BE IN DEMATERLISED FORM ONLY.

DEPOSITORY OPTION TO INVESTORS

As per the provisions of the Depositories Act, 1996, the shares of a Body Corporate can be in a dematerialised form, i.e. not in the form of physical certificates but be fungible and be represented by the statement issued through electronic mode. Many Body Corporate and their investors are now opting for this mode of electronic accounts. The Company will also opt for this method subject to the Investors exercising their option to hold the shares in dematerialised form, for which necessary columns have been provided in the respective application forms. The company has applied to the NSDL and CDSL for allotment of ISIN No.

a. A tripartite agreement will be signed between the Company, the registrar and CDSL/NSDL. The Company intends to pay one-time charges to CDSL/NSDL.

b. The investor has an option either to receive the security certificate or to hold the securities with depository.

c. Such an option if exercised should be indicated in the relevant blocks in the share application form itself.

d. Application for electronic and physical shares by the same first applicant will result in rejection of application for shares in electronic mode and only the application for electronic mode will be considered as a valid application.

e. Investors who wish to apply for equity shares in electronic form need to have at least one Beneficiary Account with a Depository Participant prior to the application.

f. Allotment Advice/ Refund orders will be directly send to the investors by the Registrar.

g. If incomplete/ incorrect investor account details are given in the application form, it may result in issuance of physical Equity Share Certificate.

h. Responsibility for correctness of applicant’s demographic details given in the Application Form vis-a-vis those with his/her Depository Participant, would rest with the investor.

i. Shares in electronic form can be traded only in Stock Exchanges having electronic connectivity with CDSL/NSDL.

j. The application form shall contain space for indicating no. of shares subscribed for in demat and physical shares or both.

k. No separate applications for demat and physical is to be made. If such applications are made, the applications for physical shares will be treated as multiple application and rejected accordingly.

l. In case of partial allotment, allotment will be done in demat option for the shares sought in demat and balance, if any, will be allotted in physical shares.

Investors who have indicated their preference for holding their shares in a dematerialised (demat) form, will have to follow the steps mentioned below :-

The applicant will fill-up the Depository Instructions Section in the application form which will authorise the Company to allot shares to him in the electronic form.The applicant may apply for part of shares in dematerialised (demat) form and balance in the physical form. This should be indicated under the heading’ “Request for shares in Electronic Form” in the application form.

TAX BENEFITS

The Company has been advised by M/s N.A. Ramachandran & Co, Auditors of the Company, vide his letter dated 23/05/2000 that under the current provisions of the Income Tax Act, 1961 and the existing laws for the time being in force, the following benefits, inter alia, will be available to the Company and the members.

A. TO THE COMPANY:

1. The Company in accordance with and subject to the conditions and to the extent specified in section 80HHE of the Act would be entitled to deduction of the profits derived from the export of computer software or for providing technical services outside India in connection with the development or production of computer software.

2. As per provisions of Section 32 of the Act the Company is entitled to claim depreciation on tangible and specified intangible assets as explained in the said section .

3. Under Section 10(33) of the Act, dividend referred to in Section 115O of the Act received by the Company will be exempt from income tax.

B. TO THE MEMBERS OF THE COMPANY:

1. Under Section 10(33) of the Act, the dividend received by the shareholders of the Company is totally exempt.

2. Long term capital gains in respect of listed shares will be chargeable under section 112 of the Act, at a concessional rate of 20% on Capital gains as computed after taking into account cost of acquisition as adjusted by Cost Inflation Index notified by the Central Government or 10% of the Capital gains whichever is lesser.

3. In accordance with and subject to the conditions and to the extent specified in section 54EA of the Act, the shareholders would be entitled to exemption from long-term capital gains.

4. In accordance with and subject to the conditions and to the extent specified in section 54EB of the Act, the shareholders would be entitled to exemption from long-term capital gains.

5. In case of a shareholder being an individual or a Hindu undivided family in accordance with and subject to the conditions and to the extent specified in section 54F of the Act, the shareholders would be entitled to exemption from long term capital gains.

WEALTH TAX

Total exemption from wealth tax would be available on investment in shares of the Company.

GIFT TAX

Effective from 1^st October 1998, no gift tax shall be levied on gift of shares of the Company.

V. PARTICULARS OF THE ISSUE

OBJECTS OF THE ISSUE

The present offer of equity shares is being made to –

1. To expand the software development Center at Chennai

2. To set up overseas training center at Canada and marketing office at Singapore

3. To meet the working capital requirement.

4. To upgrade existing hardware, software and other infrastructure facilities.

5. To meet the expenses of the issue

6. To list the equity shares of the company on Chennai, Ahmedabad, and Hyderabad Stock Exchanges.

COST OF THE PROJECT AND MEANS OF FINANCE

As per Company’s estimates the Cost of Project and Means of Finance for the existing and proposed project is as under :

Rs. in lacs

PROJECT COST	Existing as on 31.05.2000	Proposed	Amount
Overseas – Offices	0.00	87.00	87.00
Software & Software development	255.00	67.25	322.25
Computer Hardware	4.38	52.75	57.13
Furniture & Fittings	1.18	15.00	16.18
Office & Electrical Equipment	0.00	19.00	19.00
Preliminary & Public Issue Expenses	0.00	22.50	22.50
Working Capital	9.00	86.50	95.50
Total	269.56	350.00	619.56

MEANS OF FINANCE
Promoter – Share Capital	257.32	56.00	313.32
Public Issue – Share Capital	0.00	294.00	294.00
Reserves and Surplus	12.24	0.00	12.24
Total	269.56	350.00	619.56

BRIDGE LOANS OR STAND-BY ARRANGEMENT

The Company has not resorted to any other kinds of funding like Bridge Loans or any other Stand-by arrangements for incurring expenditure on the project which would be repaid from the proceeds of the issue.

DETAILED BREAK UP OF PROPOSED PROJECT COST

The break up of proposed project expenses as estimated by the company are as under :

Over Seas Training Centre And Marketing Office

The company’s training division Toronto Software technology will be opening an overseas training centre at Toronto, Canada. The company proposes to take a rental premises of about 2500 sqft. The estimated cost of this centre including establishment charges, rental deposit, furniture, interior, hardware and software is Rs.75 lacs. The company is also planning to locate its marketing offices at Singapore. The estimated cost of marketing office including establishment charges etc is Rs 12.00 lacs. The company has yet to identify the premises for its overseas office & apply and obtain RBI permission for opening overseas Office.

Software & Software Development.

The company has proposed to purchase the following Software worth Rs.67.25 lacs, details of which are given below.

( Rs in Lacs)

Particulars	Amount
NT Server with 50 user license	0.80
Msoffice 2000 50 Nos	9.50
MS Back Office CAL 4.5 intl	5.00
PUP MLP 20/non SQL 10Nos.	4.25
SQL CAL 7.0 Win NT EN/XC/FR/ DE/ES MLP 50	3.50
Exchange Server SVR ENT 5.5 Intl CD 50 clt com	2.00
MSDN Unvrsl 6.0 win 32	2.00
Office Dev Edtn 2000 win 32	8.00
Oracle 8.0	2.00
Dev. 2000	2.00
Proxy Server 2.0	1.20
Visual Studio 6.0	12.50
Turbo C++	12.50
Sun Java Workshop, Visibroker And Visigenic Case Tools	2.00
Total	67.25

No orders have been placed as yet for the software requirement as detailed above.

Hardware

The company has proposed to purchase the following Software worth Rs.52.75, details of which are given below.

(Rs in Lacs)

Description	Amount
Netfinity server(4 nos)	5.00
Net Servers (5 nos)	18.75
Laptop (3 nos)	6.00
Client Work stations (50 nos)	12.50
Networking and Peripherals	1.50
Routers	2.00
Web server	5.00
ISDN Equipment	2.00
Total	52.75

The company has placed orders with M/s Alayam Systems for the purchase of the hardware and an advance of Rs. 36.00 lacs has been paid to the supplier.

Furniture & Fittings

The company has estimated a cost Rs.15.00 Lacs towards interior, sitting arrangements, storage facility, cabins, working space for workstations and other furniture and fittings, against which the company has paid advance of Rs.5.50 lacs to the contractor M/s. Jothi Wood Fields, Chennai for the work being carried out.

Office Equipment & Electrical Equipment

The company has estimated an expenditure of Rs.19.00 lacs towards procuring of Office Equipment & Electrical Equipment. The Company has placed order for supply of Office Equipment and electrical works with M/s. Mechano Electriacal Services Company, Chennai and has paid an advance of Rs. 4.75 lacs.

(Rs in Lacs)

Particulars	Amount
UPS	2.00
EPABX/fax	2.00
AC	10.00
Gen Set/inverter	2.00
Other Office Equipment	3.00
Total	19.00

Preliminary & Public Issue Expenses

The details of the preliminary & public issue expenses are as under :

(Rs in Lacs)

Particulars	Amount
Legal & Professional Fees	8.10
Brokerage @1.5%	4.40
Printing & Stationery	5.50
Statutory Advertisement	2.00
Marketing & Traveling	1.50
Misc Expenses	1.00
Total	22.50

The company has already spent Rs.5.50 lacs towards the pre-issue expenses.

Working Capital

Based on the projected performance for the year 2000-01, the Working capital margin has been computed as under :-

Particulars	Period	Amount in lacs
Current Assets
Receivables	60 days	57.50
Inventories	90 days	15.10
Salaries, Marketing & Administration. Overhead	65 days	15.40
Other current assets	90 days	14.03
Total current assets		102.03
Less : Current liabilities	20 days	6.53
Net Current assets		95.50
Existing Working capital margin		9.00
Working capital margin included in the Cost of project		86.50

SWOT ANALYSIS

Strength

The Company is an existing profit making information Technology Company engaged in software development, e-commerce solutions and related activities. The company is also imparting training courses in various fields of Software and its related activites.

Weaknesses

The Company is relatively working at small scale operation in the Software Industry. The Company is yet to established its credentials with software majors.

Opportunities

The interim software policy of government of India announced major concessions for the Software Sector. The final policy is likely to further enhance the opportunities for this sector. The cost structures in India have rose to a tremendous potential which will result in many opportunities.

Threats

The major threat is the competition from the established Companies in the sector and also from more and more new Companies entering into this sector.

DEPLOYMENT OF FUNDS:

The company has deployed Rs.325.56 lacs as on 15^th June 2000, on the existing and the expansion project. The funds deployment statement has been certified by M/s N.A Ramachandran & co., vide their certificate dated 16.06.2000

(Rs in Lacs)

Application of funds	Existing	Proposed	Amount
Software & Software development	255.00	0.00	255.00
Hardware	4.38	0.00	4.38
Advance for Purchase of Hardware	0.00	36.00	36.00
Furniture & Fittings	1.18	5.50	6.68
Office & Electrical Equipment	0.00	4.75	4.75
Pre Issue Expenses	0.00	5.50	5.50
Working Capital	9.00	4.25	13.25
TOTAL	269.56	56.00	325.56

Sources of fund
Share capital	257.32	56.00	313.32
Reserve and Surplus	12.24	0.00	12.24
	269.56	56.00	325.56

VI. COMPANY, MANAGEMENT AND PROJECT

BRIEF HISTORY OF THE COMPANY

Lemuria Technologies Limited was incorporated on June 18th,1991 as Lemuria Technics Private Limited under the Companies Act, 1956 and the name has been changed to Lemuria Technologies Pvt Limited vide certificate dated 11^th May 2000 and subsequently converted into a Public Limited Company vide fresh certificate dated 22^nd May 2000.

The company was incorporated in the year 1991 and is into commercial operations in 1996. Since 1997, the Company is involved in Software development and system integration consultancy and training. The company is specializing in the areas of client server, component based models, web enabled applications and object oriented technologies. The company has a software development center at Chennai .

The Company has its registered office at C-94, II Floor, Thillai Nagar, Main Road, Trichy 620 018, which was changed from No.28, Netaji Street, Ayyapa nagar, Tirchy 620 001 and its Corporate Office at : 97, Harrington Road Chennai - 600 030. Both the offices have been taken on lease. The details of the agreements are as given below:

Corporate Office : 97, Harrington Road, Chennai

Lessor : Mrs.V.R.Reddappa

Area : 2000 Sq.Ft

Monthly lease rent : Rs.3500 per month

Lease Period : Two years (From April 2000)

Registered Office : C-94, II floor, Thillai Nagar, Main Road, Trichy.

Area : 350 sq. ft

Monthly lease rent : Rs.2500 per month

Lease Period : Three years (From March 2000)

For its proposed expansion, the total office area required is 6000 sq ft . The company has already entered into lease agreement for floor space of 1800 Sq.ft, the details of which are as under :

: 1^st Floor, 97, Harrington Road, Chennai

Lessor : Ms.V. Saraswathi

Area : 1800 Sq.Ft

Monthly lease rent : Rs.3000 per month

Lease Period : Two years (From June 2000)

The company is yet to identify the space for balance 4200 sqft of area.

MAIN OBJECTS OF THE COMPANY

The main objects of the Company as set out in the object clause of the Memorandum of Association of the Company are as under :-

1. To establish and carry on business as manufacturers assemblers ,traders, merchants, importers, exporters and dealers of all kinds of electrical and electronic security equipment’s, instruments and other systems including printed circuit boards, components, integrated circuits, sensors, resistors, capacitors, diodes, peripherals and subassemblies and subsystem thereof.

2. To establish and carry on business of manufacturing and assembling all types of security equipment’s & systems, printed circuit boards to be utilised in industrial business, home, entertainment, medical and process control equipment and computers, all kinds of electrical and or electronic equipment /instruments for use in hospitals television stations, micro wave stations, satellite stations, missiles and space rocketry and all kinds of electrical and electronic gadgets.

3. To carry on the business of importers and exporters and traders and merchants of all types of electrical and or electronic equipment’s and or components devices, telephone and telecommunication equipment’s, radar’s, computers, computer software and computer hardware including all equipment’s and components connected with the electrical and or electronic industry.

4. To carry on the business as agents, dealers, distributors, stockiest, representatives of any company or concern manufacturing every type of electronic and or electronic equipment’s, security devices, computers, electronic software and hardware including all equipment’s and components connected with electronic industry.

5. To carry on in India or elsewhere the profession of consultants /advisers in respect of manufacture /assembly of all types of electrical and electronic equipment’s referred to in the clauses herein before mentioned.

6. To carry on business as an export house in respect of all items mentioned in above clauses.

The main object clause of the Memorandum of Association of the Company enables the Company to undertake the activities for which the funds are being raised for the present issue and also the activities which the Company has been carrying out till date.

PRESENT BUSINESS ACTIVITY

The Company is mainly engaged into the activity of software development and training. company has developed products mainly for retail trade , Travels, Driving school based accounting management software. The company has also developed mini ERP solutions to medium range industries and migration of applications from DOS based applications to GUI based applications. The company has also set up web based intranet solutions to its clients.

The company has its its training division under the name Toronto Software Technology and has entered into a franchisee agreement with M/s DOTCOM SOFTWARE on 25^th Februaury, 2000 at # 1, Gopal Street, T.Nagar, Chennai 600 017. The major terms and condition are as under :

Scope : Franchiser will conduct the following courses

e-Commerce

Client Server Programming

Internet Programming

Advance Diploma in Software Engineering

The Franchiser will conduct all other courses, which come into market from time to time.

Payments : It has been agreed by the franchisee that 40% of the profit before tax will be paid to the franchiser towards service charges. This shall be calculated on quarterly basis and payment shall be settled immediately there after.

The Company is offering services in the following areas of IT :

A. Software solutions

1. Developing E-Commerce Portals:

The Company has developed Web portals for its customers and also develop Net based B2B and B2C portals.

The details of portals under development by the company are as under :

Project Name	Estimated cost (Amount in Lacs)
E-commerce B2C portal named as www.chennainetshop.com	34.00
E-commerce B2B portal named as www.theonlyb2b.com	43.00
E-commerce JOB portal named as www.onlyresource.com	33.00
E-commerce B2C portal named as www.secondhanditems.com	40.90
E-commerce B2B/B2C portal named as www.sparesmarket.com	33.35
E-commerce B2C portal named as www.pilgrimsindia.com	7.20
E-commerce link portal named as www.worldb2blinks.com	12.75
E-commerce B2B/B2C portal for Conybio health care (I) Ltd	22.10
Web Business Magazine portal of www.thozhilulagam.com	1.85
Web information portal of www.thamil.com	1.10
Total	229.25

Out of the total estimated cost of Rs. 229.25 lacs an amount of Rs. 134.50 lacs has already been incurred.

The basis of costing for the portals as estimated by the company is as under :-

a) The concept and content management : 20%

b) Page Designing : 5%

c) Dedicated Server space with company location facilities and the hardware : 20%

(Computers) and software to be used (Window NT,ASP, Servlets, Beans,

Visigenic, Oracle, SQL Server etc)

d) Portal development expenses : 40%

(Consultancy charges, salaries, other overheads including technological obsolesce cost.

e) Web Strategy development : 15%

(Includes collaboration tie up cost, marketing and implementation cost)

The salient features of each web portals are as below :-

1. www.chennainetshop.com

This is basically an E-commerce B2C online shopping portal which will provide an comfortable shopping experience with shopping carts and wide range of products. Buyers can also send e-greetings to their friends and relatives and also has an provision for online discussions/voice chat with the sellers to know about the product and bargain on price. In future it will also have a feature of online auctions.

2. www.theonlyb2b.com

This E-commerce B2B portal is to cater the business to business transaction for Indian industrial sector in Mechanical, Electronics, Chemical and Computer. With the future staying on B2B sites this portal will have features attached with EDIINT (electronic data interchange in internet)and ABREDI (automatic billing and reconciliation and electronic data interchange).It is proposed to have tieup with leading credit card and banks to bring in a separate payment setup on our B2B site.

3. www.onlyresource.com

This is a job portal which will provide ample information on the jobs available in the market. This portal is also planning to conduct online job fair on this portal as a regular feature.

4. www.secondhanditems.com

This E-commerce B2C vertical portal caters to the people who would like to sell second hand items and people who would like to buy such second hand items.

5 www.sparesmarket.com

This E-commerce B2B/B2C vertical portal which is going to provide complete support online in providing business to Automobile spares sector.

6. www.pilgrimsindia.com

This is an information portal which will provide substantial amount of information about the pilgrim sites all over India for all religions.

7. www.worldb2blinks.com

This is an link portal which is going to provide link to all B2B sites in world and going to provide information about the B2B sites.

8. www.cbhindia.com

This E-commerce B2B/B2C vertical portal for the healthcare business of, M/s Conybio Health Care India Pvt. Ltd. This is going to provide complete support online for their Multi level marketing business involving distributors, stockiest, C& F agents, customers and company and connects all of them on to a broader network.

9. www.thozhilulagam.com

This is a Magazine portal for leading Tamil business magazine called thozilulagam. This will cover the whole magazine every month online. The company is developing this portal for M/s. Thozhil Ulagam Publications.

10. www.thamil.com

This is an information portal which will provide substantial amount of information about the activities and news of Tamil Nadu, matrimonial, tamil chat and tamil phonetic mail.

2. Mini and Micro ERP Packages using Client server:

Company has already developed mini ERP solutions using Oracle and D2K for its customers. The company plans to develop more customized application to suit medium scale establishments. Presently a project is being developed for retail trade. The Company has proposed to develop Micro ERP applications on client -server mainly on SQL server as database and Visual Basic as GUI. These applications are mainly for banking automation applications and presently a project is being developed for Travel Industry.

3. Legacy systems solutions:

The company’s professional team has expertise on legacy systems. The company is providing solutions for legacy systems on IBM systems.

The details of some of the software products and Clients of the Company are as under :

Name	Project executed/product
ConyBio Health Care(I) P Ltd	Mini ERP solution
A.B.Travels,Chennai	Accounting management package
Bala Travels, Chennai	Accounting management package
Vijaya Driving School, Chennai	Accounting management package
Raj Travels, Chennai	Accounting management package

B. Enterprise Training

The Company is providing training in the e-commerce and client server applications and earlier it was providing training in legacy systems. The company is offering the following certificate courses.

Java programming

Advanced java programming and project development

Internet programming

Object oriented programming (C,C++)

Client server programming

CORBA Management

Internet tools

Training is carried out with well planned methodology of theory and project orientation which helps to develop potential human resource for IT sector.

C. Professional Services

Software consultant contracting : The company is providing highly skilled software professionals for various companies both in India and overseas. The Company has already started a dot com wing called onlyresource.com for this purpose.

Hardware

The Company has already purchased hardware to the tune of Rs.4.38 lacs, details of which is given below :-

(Rs. In lacs)

Computers 3.96

UPS 0.32

Printer 0.06

Modem 0.04

Foreign Strategic Business Alliances.

The company has entered into strategic business alliances with the following US and Canadian based companies

1. Software Galaxy Systems : A software company having its office at Newjersey USA . LTL has been appointed as a business associate vide letter dated 27/04/2000. The following are the major terms of the appointment.

· Scope : SGS and LTL will deal the activities such as offshore software development, client server and consulting services

· Validity: Valid upto March 2001. Period will be extended based on mutual consent.

2. Garimella System Search Inc.: A software company having its office at Toronto, Canada. LTL has been appointed as a techno business associate vide letter dated 25/05/2000. The following are the major terms of the appointment.

· Scope : GSS and LTL will deal the activities such as providing quality software professionals in various skill sets for professional services, providing offshore software development support etc

· Validity: Valid up to May 2001.

LTL will also expand its software activities on onsite software development and professional services. It is also understood that during these marketing activities, the marketing representatives will identify opportunities and will work diligently in presenting the company‘s strength and capabilities and interests to prospective clients. LTL & US Alliance companies will establish sales & marketing and a services infrastructure in U.S and jointly chalk out marketing plans. The Company’s project management staff will provide technical assistance in generating proposals, evaluation, project management and execution of projects in the US.

SUBSIDIARY COMPANY

The Company does not have any subsidiary company.

PROMOTERS AND THEIR BACKGROUND

The Company was originally promoted by Mr.T.Senthilnathan and Mr. V.R.Muruganantham who were subscribers to the Memorandum. In the year 1997, Mr.T.Senthilnathan and Mr. V.R.Muruganantham resigned from the company due to other occupations. They were holding 200 equity shares of Rs. 10 each of the company and the same has been acquired by the existing promoters Mr.K.Ashok and Mr.K.Kumaraguru.

Mr. K.Ashok, age 31 Yrs , B.E from P.S.G.college of Technology ., Coimbatore in 1990 and M.B.A from Madras University in 1996. He is qualified technical consultant with specialisation in (OLTP-online transaction processing) transaction management (CICS),database applications (DB2) of IBM corporation-USA and associated in many software development and implementations. In 1996 he has received the certificate of achievement from Vetri software India Ltd in IBM mainframe and ORACLE from computer point. His software knowledge includes specialised in IBM Mainframe( COBOL, CICS, JCL, DB2, IMS, REXX) in legacy systems and worked in projects related to electronic data interchange and client server applications using oracle . He is having 10 years experience in project management, instrumental in development of software solutions for retail trading ,travel ,financial sectors and other logistics solutions for all industries. His expertise includes Web designing, java, jdbc, beans, RMI, CORBA and web portal management. He has rendered consultancy for system integration and provided solutions in the project called ABREDI(Automatic Billing & Reconciliation and Electronic Data Interchange) for BELL CANADA under CGI Inc in Toronto, Canada. He has good exposure in testing, quality assurance and quality control aspects of ISO 9000 and other standards.

Mr. K.Kumaraguru, age 26 Yrs, B.E (Electronics and Instrumentation) from Bharathidasan University, Trichy in 1996. He is having 4 years experience in project management and development experience of Legacy systems (IBM Mainframe and AS400) and client server solutions for all sectors. He is qualified technical consultant with specialisation in (OLTP-online transaction processing) transaction management (CICS),database applications (DB2) of IBM corporation-USA and associated in many software development and implementations. In 1996 he has received the certificate of achievement from Vetri Software India Ltd in IBM mainframe. He is expert in Web designing, java, JDBC, beans, RMI,CORBA and web portal management. He is good at Database management ,data modeling ,quality assurance and testing standards.

DETAILS OF OTHER COMPANIES / FIRMS WITH WHICH PROMOTERS ARE ASSOCIATED

There are no companies/Firms with which promoters are associated.

COMPANIES UNDER THE SAME MANAGEMENT

There are no listed companies under the same management

BIO-DATA OF THE NON-PROMOTER DIRECTORS

Mr. N.Nagarajan, As a Software consultant, he has around 12 years of experience in designing, developing, testing and implementing commercial applications mostly using ORACLE RDBMS, UNIX, VMS and C. He is a Graduate in Commerce, University of Madras, India and a Post Graduate Diploma in Systems Management, National Institute of Information Technology, India. He has expertise in the following hardware’s DEC VAX, MICRO VAX II, UNiSYS 6000, SEQUENT, BULL DPX-2, NCR and HP UNIX based systems and IBM Compatible PCs. And software’s such as ORACLE 8.1.5 and earlier versions: Oracle Financials Version 9.4.0; Oracle*Developer, Designer, CASE Tools, Sybase Power Designer 7.1, PL/SQL, SQL*Loader, Report Writer, Oracle*Book, SQR, PRO*C, C, COBOL, FOXPRO, Shell, MS Office Products and Operating systems as WINDOWS / 95 / 98 / NT, MS-DOS, SCO-UNIX, UNIX SYSTEM V, VAX / VMS.

His consultant experience are with the following clients since 1987 –AT&T, Lucent Technologies and BellCore, Telcordia Technologies (Formerly Bellcore), New Jersey. Lucent Technologies (New Jersey), AT&T (Morristown, New Jersey), PEROT Systems (London), BULL Research and Development (England), GLAXO Research and Development (England), Bank Of Oman (Dubai, UAE), Hindustan Computers Limited, India

Mr.K.Rajesh age 26 yrs., B.E computer science from Mookambika college of Engineering, Trichy. He is having 3 years experience in project management and development experience of Legacy systems (IBM Mainframe and AS400) and client server solutions for all sectors. He is qualified technical consultant with specialisation in (OLTP-online transaction processing) transaction management (CICS),database applications (DB2) of IBM corporation-USA and associated in many software development and implementations. His consultant experience includes Tata Elixsi India and MIDAS Inc., Chicago ,USA

Mrs.A.Hamsa age 23 years B.com from Madras university in the year 1997 and she is having exposure in Human resource, training and office management. She has exposure in evolving company policies on employees. She is handling the training division (Toronto software technologies) of LTL. She is instrumental in designing course structure, material, duration, franchisee management, faculty management, image building and corporate training.

BOARD OF DIRECTORS

Name	Designation	Residential Address	Qualification	Other Directorships
K.Ashok	Chairman & M.D	19,North Thirumalai Nagar, I Street Villivakkam, Chennai 49	B.E , M.B.A	None
K.Kumaraguru	Director	No 3/343, Mettukuppam Main Road, Chennai-96	B.E (Electr & Instru)	None
N.Nagarajan	Director	Apt # 3707, No.3, Masey Square, Toronto, ON –M4L5L5, Canada	B.com	None
K.Rajesh	Director	1326, East Algonquin Road, Apt-3L, Schaumburg, IL-60173, U.S.A	B.E(Comp science)	None
A.Hamsa	Director	19, North Thirumalai Nagar, I, Street Villivakkam, Chennai 49	B.com	None

MANAGEMENT

The overall management of the Company is vested in the Board of Directors. K.Ashok Chairman and Managing Director, under the guidance and supervision of the Board, manages the affairs of the Company. Mr. K.Kumaraguru, Director, Mr. N.Nagarajan Emeritus Director , Mr.K.Rajesh Emeritus Director and Mrs A.Hamsa Director( Training) will drive the Company to achieve its set goals and they are assisted by a team of professionals.

KEY EMPLOYEE PROFILE

1. Mr. R.Ravi, aged 36 years with a qualification of Bachelors in Electronics Engineering and Microsoft certified Solutions developer and is a Sr.Project manager. He has expertise in Windows NT, Unix, Novell and Database administration, web related areas and also having good expertise in legacy system of AS400

2. Mr. K.Muralidhar age 31 years, B.E., M.B.A is a Project Manager. His Software expertise includes Oracle, Visual Basic, client server applications web designing, portal management. He is having 10 years experience in project management, development of client server, solutions for financial and other sectors and industries. He is also having experience in providing total solutions in hardware and manufacturing of PC’s networking solutions and software packages.

3. Mr. P.Shanmugasundaram, aged 28 years with a qualification of Bachelors in Electronics engineering and expert in client server applications web designing ,portal management.. He is Sr.Software Engineer

4. Mr. R.Sreenivasan, aged 25 years with a qualification of Bachelors in Electronics Engineering and Microsoft certified Systems Engineer is the Systems manager. He has expertise in Windows NT, Unix, Novell and Database administration .

5. Mr.R.Suresh, aged 23 years with a qualification of Bachelors in Chemical Engg is the Software engineer. He has expertise in C++, VB,COM,DCOM,ASP, HTML,VB Script & MS SQL SERVER.

6. Mr.R.Ravishankar, aged 23 years with a qualification of Bachelors in Chemical Engg is the Software engineer. He has expertise in C++, VB,COM,DCOM,ASP, HTML,VB Script & MS SQL SERVER.

7. Mr.R.Prasanna, aged 25 years with a qualification of Masters in Information technology is the Software engineer. He has expertise in C++, VB, COM, DCOM, ASP, HTML, VB Script & MS SQL SERVER.

8. Mr. N.Prabhu, aged 31 years with a qualification of Bachelor of commerce is the G.M(Marketing). He has expertise in Microsoft application suites and has 10 years of experience in concept selling. He has worked in various companies in marketing and also in resource mobilisiation.

9. Mr. S.Raja, age 30 yrs, with a qualification of Bachelor of Commerce and MBA is G.M (Finance & Administration) having 9 years experience in finance and costing.

Name of the Employee	Designation	Qualification	Experience
Mr. R.Ravi,	Sr. Project Manager	B.E.( Engineering)	10 years
Mr. K.Muralidhar	Project Manager	B.E. , M..B.A.	10 years
Mr. P.Shanmugasundaram	Sr. Software Engineer.	B.E.( Engineering)	3years
Mr. R. Sreenivasan	Systems Manager	B.E.( Engineering)	3 years
Mr.R.Suresh	Software Engineer	B.E.(Chemical Engineering)	1 year
Mr.R.Ravishankar	Software Engineer	B.E.(Chemical Engineering)	1 year
Mr.R.Prasanna	Software Engineer	Masters in Information Technology.	1 year
Mr. N.Prabhu,	General Manager (Mkt)	B.Com	10 years
Mr. S.Raja	General Manager (Fin & Mkt)	B.Com. , M.B.A.	6 years

The Lead Manager has verified and confirm that the names of persons appearing in the table above are in the rolls of the Company as permanent employees.

The management team comprising of the Promoters/ Directors and the Key Managerial Personnel is capable of successfully implementing and running the proposed activities.

CHANGES IN THE KEY MANAGERIAL PERSONNEL DURING THE LAST 12 MONTHS

There have been no changes in the key managerial personnel in last 12 Months.

LITIGATION / DISPUTES / DEFAULTS :

1. There is no pending litigation in which the promoters of the Company are involved.

2. There are no over dues, defaults to the Financial Institutions/Banks, reschedulement of loans to Banks/ FI’s by the Company. There are no pending offences of non-payment of statutory dues by the promoters of the Company.

3. There are no cases of litigation’s pending against the Company or against any other Company whose outcome could have a materially adverse effect on the position of the Company.

4. There are no pending litigation’s against the Promoters / Directors in their personal capacities and also involving violation of statutory regulations or criminal offences.

5. There are no pending proceedings initiated for economic offences against the Directors, Promoters, Companies and Firms promoted by the promoters.

6. There are no outstanding litigation’s, disputes pertaining to the matters likely to affect the operations and Financials of the Company including disputed tax liability, prosecution under any enactment in respect of Schedule XIII of the Companies Act, 1956.

7. There are no litigation’s outstanding against the Promoters/Directors in their personal capacity. The Company, its promoters and other Companies with which promoters are associated have neither suspended by SEBI nor any disciplinary action has been taken by SEBI. There is no prosecution launched by Income Tax Authorities and no liability compounded by the Promoters/Company/Ventures with which the Promoters are associated is subsisting.

8. There are no cases of pending litigation/defaults in respect of the firms / Companies with which the Promoters are associated in the past but are no longer associated.

TECHNICAL ARRANGEMENT / AGREEMENTS

The Company has not entered into any technical arrangement with any other outside agency.

INSTALLED CAPACITY / CAPACITY BUILD UP

The activity being information technology related, details such as installed capacity, capacity build up etc. are not applicable.

UTILITIES

1. Raw Materials

The company operates in the technology oriented service industry and as such does not require any raw materials. The main consumable items required are like Floppy disks, Magnetic Tapes, other Data Storage media, printer cartridges, computer stationary all of which are easily available.

2. Power

Since the company is a software company having systems and lighting, the electricity supplied by the Electricity Board will suffix the requirement of the company. The company do not foresee any undue problems in power supply.

3. Water

Water is required only for drinking and sanitary purposes and adequate water sources are available at the existing premises. The requirement is fully met through the Corporation water.

4. Effluent Disposal

The company’s operation do not generate any effluents/pollution. The company is exempted from seeking a clearance from the pollution control board as it is classified under non pollution industry.

5. ManPower

The company is proposing to set up a software development center with 50 workstations, which requires approximately 50 software professionals. As the present manpower of the company is 16, the company will be recruiting additional technical personnel during the next quarter. The company has already conducted and screened more than 200 candidates suitable to the company’s projects and hence the company does not foresee any problems in recruitment.

FINANCIAL INFORMATION

The audited financial results of the Company for the last four years and for the period ended 31.05.2000 are as follows :-

(Rs. lacs)

Particulars	1996-97	1997-98	1998-99	1999-00	As on 31/05/2000
Gross income	0.50	8.42	9.12	36.05	20.08
Expenditure	0.46	7.35	7.43	28.42	11.26
PBIDT	0.04	1.07	1.69	7.63	8.82
Interest	0.00	0.00	0.00	0.00	0.00
Depreciation	0.06	0.52	0.61	1.06	0.18
Profit before tax	(0.02)	0.55	1.08	6.57	8.64
Provision for taxation	0.00	0.10	0.20	1.53	2.75
Profit after tax	(0.02)	0.45	0.88	5.04	5.89
Share Capital	121.82	121.82	121.82	257.32	257.32
Reserve & Surplus	(0.02)	0.43	1.31	6.35	12.24
EPS	(0.002)	0.05	0.07	0.20	1.37*
Dividend	0.00	0.00	0.00	0.00	0.00
NAV per share	9.99	10.04	10.11	10.25	11.62*

* - Annualised

MANAGEMENT DISCUSSIONS AND ANALYSIS

Analysis of Financial results :

For the period 1997-98 to 1998-99

The income of the company has risen to Rs.9.12 lacs as compared to last years Rs.8.42 lacs and the PAT has risen to Rs.0.88 lacs from last years Rs.0.45. The growth in the income has been due to increase in the income from Software Development from Rs.2.52 lacs to Rs.3.07 lacs and Software training from Rs.5.90 lacs to Rs.6.15 lacs.

For the period 1998-99 to 1999-00

The income of the company has risen to Rs.36.05 lacs as compared to last years Rs.9.12 lacs and the PAT has risen to Rs.5.04 lacs from last years Rs.0.88. The growth in the income has been due to increase in the income from Software Development from Rs.3.07 lacs to Rs.23.70 lacs and Software training from Rs.12.35 lacs to Rs.6.15 lacs.

Unusual or infrequent events or transactions

There are no unusual or infrequent events or transactions since incorporation.

Significant Economic Changes that materially affected or are likely to affect income from continuing operations

The Government of India has identified Software Industry as a thrust area and incentives are being provided to encourage the Industry. Hence, the Company does not foresee any adverse policy changes that could be detrimental to the growth of this Industry.

Known Trends or uncertainties that have had or expected to have a material adverse impact on sales, revenue or income from continuing operations.

The Software Industry is prone to high level of technological obsolescence and rapid technological changes. LTL has developed inherent skills to keep pace with these changes, to be on par with the latest technology.

Future changes in relationship between costs and revenues in case events such as labour or material costs or prices that will cause a material change are known

As the Company is an existing Company and its revenues are in order to order basis, the value of order is quoted considering all the relevant costs, and proper cushion is kept for any contingencies.

The extent to which material increase on net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices.

The incremental growth in the projected sales and revenues of the Company is based on the assumption that the Company will enjoy the benefits of increased productivity, expansion of business and the repeat business anticipated from its clients for the quality of services that would be rendered to them.

Total turnover of each major industry segment in which the Company operates

The Indian Software Industry has recorded an overall growth of 58% with total revenue of Rs.10,000 Crores during 1997-98. A market research done by International Data Corporation on Document Management Segment revealed that a total revenue of approximately $859.9 million in 1996, which was estimated to grow to more than $9.5 billion in the year 2002 indicating a five-year CAGR of 33.8%.

Status of any publicly announced new products or new segment

Not Applicable

The extent to which business is seasonal

Software industry is non-seasonal in nature and business volumes are only dependent on the marketing efforts of the Company.

Any significant dependence on a single or few suppliers or customers

There is no significant dependence on a single or few suppliers or customers.

Competitive conditions

The Company faces competition from Multinationals and Indian Companies for the Software Development. The Company’s ability to deliver the customised product in time and its commitment to service will enabled the Company to thrive despite Competition.

SCHEDULE OF IMPLEMENTATION

The project implementation schedule is as detailed below :-

PARTICULARS	COMMENCEMENT	COMPLETION
Office Premises (including interiors)
- Phase I (1800 sq.ft)	June 2000	July 2000
- Phase II (4200 sq.ft)	July 2000	August 2000
Software & Hardware
- Order Placement	June 2000	July 2000
- Delivery	July 2000	Aug 2000
- Installation		Aug 2000

Overseas Office	Aug 2000	Sep 2000

Business commencement
- Indian operation expansion		Aug 2000
- Overseas operation		Oct 2000

The Company is in the process of implementing the project as per schedule of implementation and is hopeful that the implementation will be completed within estimated time frame baring unforeseen circumstances. Presently there is no delay in the implementation.

FUTURE PROJECTS

The Company will offer services in the following areas of IT :-

A. SOFTWARE SOLUTIONS

1. Developing E-Commerce Portals: Company has proposed to develop Web portals for its customers and also development is going on for Net based B2B and B2C

2. CORBA based component projects: Applications developed by the company are platform dependent. To make all these products platform independent products are to be developed on object based technology.

3. Mini and Micro ERP Packages using Client server: The Company has already developed mini ERP solutions using Oracle and D2K for its customers. The company plans to develop more customized application to suit medium scale establishments. Presently a project is being developed for retail trade. The Company has proposed to develop Micro ERP applications on client - server mainly on SQL server as database and Visual Basic as GUI. These applications are mainly for banking automation applications and presently a project is being developed for Travel.

4. Data warehousing : The Company has proposed to provide data warehousing solutions to its clients

5. System Audit, Management Consultancy and total business solutions: The company is proposing to provide system audit, consultancy and total business solutions to its clients

B. ENTERPRISE TRAINING

Domestic :

The Company is already providing high quality high end enterprise training in e-commerce, client server, data management and software quality management through its training wing called Toronto Software Technologies. The Company has given franchisee to M/s Dotcom Software for imparting training programs and simultaneously planning to launch franchisees in all major cities in India, for which the company would be appointing a franchisee manager and a team under him to manage the activities arising out of large scale training.

Overseas operations:

The Company is planning to start a training center in Toronto ,Canada. Mr. N. Natarajan Company Director, who is a Canadian based permanent resident will provide high quality high end enterprise training in e-commerce, client server, data management and software quality management. Mr. N. Natarajan will oversee the operations of Canada office. The Company is in the process of identifying all the resource requirement for this office.

C. PROFESSIONAL SERVICES.

The requirement for highly skilled software professionals are always in great demand and company is proposing to concentrate on this area to provide software consultants to various companies in India and also globally on contract basis. This part of the resource(manpower) requirement will be separately generated and utilised for the purpose. The Company has already started a dot com wing called only resource.com for this purpose.

BUSINESS GROWTH STRATEGY

EMPLOYEES RETENTION

Company believes that the employees are the core asset to the any organisation. Hence company is planning to form employee stock option plan and thereby it will bring in more commitment towards the work and bring in the feeling of ownness. The Company is also planning to introduce master tech-checkup every year and bring out the necessary technological up gradation requirement in the form of a formal training program. This will help the company to understand the needs of technical up gradation and also makes them to stay ahead in the market.

QUALITY ASSURANCE STRATEGY

The quality control and assurance is starting from every employee of the organisation towards quality product and service and company will strive hard to achieve the total quality management. As TQM is the basic quality objective of the company, LTL will initially prepare and achieve ISO 9000 and then it will further proceed with SEI CMM levels. Stringent quality procedure will be adopted and total customer satisfaction is the main motive in providing the product or services.

DEVELOPING LONG TERM CLIENT RELATIONSHIP

The Company believes in understanding the existing customer relationship in more deeper and thereby understanding their future needs and requirements of services and technology will help them to be the part of their decision making circle. The Company is proposing to start a exclusive customer support cell which will have strategic growth and operational responsibility defined which will ensure faster delivery with best quality.

APPLICATION DEVELOPMENT SERVICES

· New Product development,

This is particularly concentrating on the application products which includes design, development, testing and marketing of these products. In this cases company will provide product requirement analysis and definition, evaluation and selection of appropriate system architecture, data modeling, product engineering, development, testing and implementation of the product. By thorough evaluation and structuring of the product, it can be brought into global sector.

· Software development and consulting services.

IT consulting, providing technical consultancy in the areas of strategic planning, architecture planning, operational assessment, benchmarking and implementation planning ,identifying mission critical systems, migration necessity web enablement, data warehousing, inventory management, resource management and code reusability. LTL will also provide end user training and technological up gradation.

· Internet application development

With internet making a bigger headway in the IT sector, company is planning to provide the following application development in the areas of internet based EDI, billing, reconciliation with banks in an automated system, business to business commerce, purchasing controls, retail sales, supply chain management.

· Security services.

Since internet has entered into every area right from government organisation to private sectors and consumers security of data and the site and portal have become more vulnerable due to hacking and viruses. Company is planning to create a separate wing to identify the vulnerability not only for LTL but also to other companies and will provide comprehensive security cordon to the clients.

The Company has skills and experience in all the models from legacy systems, client server based systems and latest systems like CORBA, RMI, JDBC, EJB, and markup languages like HTML, DHTML, VRML, SGML and object oriented methodologies like UML and programming languages like COBOL, C, C++, JAVA and all internet based tools.

BUSINESS POLICY & MARKETING STRATEGY

Turnkey Projects: Company will be executing turnkey projects for both International as well as domestic clients

Product Development: The company’s understanding of the domestic market has enabled the company to emphasis more on the product development and is planning to develop more products specially in the areas of Retail trade , business logistics ,travels, web networking solutions.

Software Development: The Software Development will be mainly in the areas of Client/Server system mainly in SQL Server and VB, Web Enabled applications in JAVA, ACTIVE SCRIPTS and component based projects in CORBA

Partnerships : Company is planning to have office in Canada and marketing office in singapore and will be tying up with marketing companies in U.S to obtain and execute major projects. For the Domestic market the company plans to open offices in the metros and the important B grade cities. It will have tie up with a Local partner in A Class cities.

Domain Expertise: The company’s main focus would be in the following sectors:

a. Retail Trade Management

b. Transport and Logistics

c. Telecommunications

d. Banking and Finance

R&D:

The Company’s objective of thrust in Product development requires a huge pool of highly skilled professionals, the company would have a core group of professionals in both technical and functional aspects.

Quality:

Company believes in strong quality management and policies, hence initially would obtain ISO certification for its development centers and would later prepare for SEI-CMM level 4 certification.

INDIAN SOFTWARE SCENARIO

Introduction

With the emerging strengths of in the areas of cost effectiveness, world class quality, high reliability, rapid delivery and state of the art technologies India is fast emerging as a leader in software business.

The Indian software industry, has zoomed from a mere US$ 150 million ten years ago to a whopping US$ 3.9 billion in 1998-99. In 1998-99, more than 203 out of the Fortune 1000, that’s nearly one in five, outsourced their software requirements from India. US customers bought almost 61 per cent of the software that Indian companies exported to 91 countries around the world.

The ultimate tribute to the skill-base of the industry has already been paid by Microsoft Chairman Bill Gates, who picked the Indian city of Hyderabad to house his company’s first-ever development centre outside the U.S.A.

As per a recent analysis by McKinsey & Co., India is best positioned to offer competitive cross-border IT Services and enterprise IT solutions scoring high on multiple parameters of vendor sophistication as well as people sophistication.

According to international experts, ‘’Indian software companies have a unique distinction of providing efficient software solutions with cost and quality as an advantage by using state-of-the-art technologies, a very strong capacity to handle large projects, and, above all, the ability to execute them on time.’’

Indian Software Industry: Indicators & Statistics

In the year 1998-99, the software industry in India was worth Rs. 158.9 billion (US $ 3.9 billion) and if we add in the value of in-house development that takes place at many large commercial / corporate end-users, then the total software industry is close to Rs. 190 billion or US $ 4.6 billion, whereas ten years back the software industry in India was not more than Rs. 2000 million or US $ 150 million.

The C.A.G.R. (Compounded Annual Growth Rate) for the Indian software industry revenues in the last five years has been 56.3%. Here the C.A.G.R. for the software export industry has been 60.71% while that for the domestic industry has been 46.05%.

India still enjoys an advantage over many other nations in software development, services and exports, as she possesses the world’s second largest pool of scientific manpower, which is also, English speaking. Coupled with the fact that the quality of Indian software is extremely good with relatively low cost, it provides India a very good opportunity in the world market.

As on 31 March 1999, the software industry in India employed more than 250,000 people and continues to be amongst the fastest growing sectors in the Indian economy. Out of 250,000 people, almost 80,000 were employed in software exports.

Domestic Software Market

In 1998-99, the domestic software industry has been estimated at Rs. 49.5 billion (US $ 1.25 billion) and this does not include the in-house development of software by end-users. The domestic software market has shown a C.A.G.R. of 46.05%, which has been steadily improving, in the last few years.

The growth rate in domestic software market was 41.02% in the year 1998-99. The domestic software market is expected to gross Rs. 73 billion in 1999-2000. With the rigorous enforcement of Copyright laws, increased government spending on IT due to Task Force recommendations, it is expected that in the coming years, the domestic market for software can even register more than 50% annual growth rates. Also, the government has implemented zero import duty on software. This would have a buoyant effect on the market and the increasing trend of buying software through Internet. It is expected that by the year 2008, revenues of Indian domestic software market would equal revenues from India’s software and services exports, touching US $ 35 billion by the year 2008. The maximum growth in domestic software market is expected from banking, e-governance, defence, SOHO, etc.

Software Export Industry

The Indian software export industry has recorded in terms of Indian rupees, the C.A.G.R. over the past five years as high as 60.71%. The industry exported software and services worth Rs. 0.30 billion in 1985; in 1998-99, a total export of US $ 2,650 million (Rs. 109.4 billion) was achieved and it is expected that during 1999-2000, software exports will be worth Rs. 167 billion.

The software industry in India expects to reach an export level of US $ 6.3 billion by year 2000-01 and US $ 9.5 billion by the year 2001-02. The National IT Task Force has set a target of US$ 50 billion of annual software and services exports by 2008.

For achieving this velocity of business, both the software industry and Government of India are currently taking some bold and purposeful steps. Amongst others, this exercise includes path-breaking measures adopted by National IT Task Force to further liberate the economy, simplification of procedures, deployment of additional resources for technical manpower development, new marketing channels, enhancing global brand equity and providing state-of-the-art infrastructure for software development. E-Commerce, Software Development, Interactive Integration services and I. T. Enabled Services are leading the way.

Break-Up of Software Activity

An analysis of break-up of software activity of both domestic as well as export industry is given below.

SOFTWARE ACTIVITY	DOMESTIC MARKET		EXPORT INDUSTRY
	Rs. Million	Percentage	Rs. Million	Percentage
Projects	14,100	28.5%	39,950	36.50%
Professional Services	2,500	5.0%	48,300	44.15%
Products & Packages	23,900	48.5%	8,650	7.90%
Training	2,300	4.5%	1,880	1.72%
Support and Maintenance	2,000	4.0%	4,650	4.25%
I. I. Enabled Services	4,700	9.5%	5,970	5.48%
Total	49,500	100%	1,09,400	100%

Domestic Software Activity

As per a Nasscom study, over 122 new software products were launched by domestic software companies and over 158 new software products were launched by overseas companies in the Indian domestic market. There was a 37% growth in CAD/CAM market, 31% growth in RDBMS sales, 46% increase in sale of ERP packages and 35% increase in financial packages. Increased penetration of computers, strict implementation of copyright act and further control of piracy may further strengthen these segments of the market. Software purchases by SOHO market witnessed an all time high growth rate of 61%.

Software Export Activity

In the export market, India’s expertise in ‘Professional Services’ and ‘Projects’ are expected to continue their dominance as a major part of Indian software export activity.

Indian Software Exports - U.S.A. Tops the List In 1998-99, India exported almost 61% of its total software exports to USA. Export to Europe was at 23% and more market opportunities in Japan, South Africa, Canada, France and Middle East were discovered.

The six OECD countries (U.S.A, Japan, U.K., Germany, France and Italy) together have almost 71% of the market share of the worldwide software market. Interestingly, India’s export to these countries is also almost 79% of its total software exports.

In the coming years, software companies in India are expected to strike quite a few deals for joint ventures and strategic alliances in Europe. The new markets being vigorously explored include Korea, South Africa, Latin America and countries in Eastern Europe. U.S.A. continues to be India's largest export market and would continue its leadership position. To increase software trade with Japan, Nasscom has launched special program called NINJAS (Nasscom’s India Japan Alliance in Software). Recently, Nasscom has also signed a software pact with Israel.

Large Pool of Professionals

India has the second largest assembly of English-speaking scientific professionals in the world today, second only to the US. It also has a growing bank of 4.1 million technical workers, supplied by, among others, over 1,832 educational institutions and polytechnics, which train more than 67,785 computer software professionals every year.

NASSCOM every year undertakes a survey to understand the manpower requirements of the industry. The study undertaken in April 1999, highlighted the following facts:

• The number of software professionals employed has increased to 250,000 in 1998-99 compared to 2,00,000 in the preceding year. This includes software professionals in non-commercial organisation as well as software development units in user organisation.

• Almost 67% of the software professionals employed in the industry were in software development and operations, 3% in domain expertise development, 11% in marketing and relationship development, 15% in client support and 4% in other activities.

• The overall median age of the software professionals was about 26.2 years.

• 77% of software professionals in software companies were men, whereas 18% were women. However, this ratio is likely to be 65:35 (male: female) by the year 2003.

• Half of the software professionals possessed 5 years of working experience.

• There was an average of 21% rise in basic salary in 1998 over the previous year. However, rise in total compensation was supported by issuance of stock options to employees. During 1998-99, as many as 41 software and solutions companies announced employee stock options plans.

• In 1998-99, although the attrition rate was controlled at 16% (from the earlier turnover rate of 25% in 1992), but it still remained high, fuelled by 50% growth in the revenue for the software industry in 1998-99. This caused the HRD market to tighten considerably.

• Our software professionals were highly rated by their employers for their quality. Most gave an average of close to a 9 on a 10 point rating scale, with 1 being the lowest and 10 being outstanding.

• The skills in demand were in the area of business applications of software development, Y2K tools and practices, E-Commerce, Euro, software engineering, Java, ERP, Interactive Integration Services, Data ware housing, Internet, Client-Networking, BPR, OOPS, client-server, GUI, Windows, project management, quality assurance, technical writing, telecommunications, networking and RDBMS.

Global Presence

Software companies are beginning to increase their local presence on a worldwide basis. This entails staffing overseas offices with local teams of professionals. Already, 212 Indian software companies have either subsidiaries or branch offices overseas, mostly in the USA.

High Quality

India’s software industry has achieved a remarkable distinction for providing excellent quality. At present, 137 software companies have acquired ISO 9000 certification, and about 147 more companies are in the pipeline to be certified. Out of these 147 companies, about 74 companies are expected to be certified by March 2000 and 73 companies are expected to receive certification by March 2001. In fact, the Indian software industry will soon have more ISO 9000-certified companies than any other country in the world. Many of its members are now focusing on acquiring SEI-CMM (Software Engineering Institute - Capability Maturity Model) certificates of software process capabilities and maturity. As many as 32 Indian companies already have SEI-CMM certification, with six of them having reached Level 5. It must be noted that worldwide, only 12 companies have reached that level, and just six of them do not belong to India.

Enterprise Resource Planning

Enterprise Resource Planning (ERP) is being increasingly adopted across a spectrum of industries and enterprises at various stages in terms of size. The objectives are obvious: efficiency, reduced time of response, transparency, lowering of costs, better integrated enterprise-wide and intercorporate enterprise systems and, simply, improved collaborations. India offers unique solutions including ERP products and ERP implementation services.

INDIAN SOFTWARE INDUSTRY - SWOT ANALYSIS

A strategic review of the Indian Software Industry through SWOT Analysis depicts :-

*Strengths:*	*Weaknesses*:
High Quality – Low Cost	Lack of package orientation for the products developed.
Large English-speaking, scientific and trainable manpower pool.	Low domestic computerisation.
Use of State- of-the-art Technologies	Lack of efforts to develop original technology.
Flexibility and adaptability to new technologies.	Low experience in Mission Critical Real Time Operations
Reliability of programmers to provide expertise for small or large projects.	Inadequate availability of project management skills.
Offshore development through Datacom links providing immense cost and time saving.	Lack of adequate venture capital finance.
Ability to handle large and turnkey projects.	Bureaucratic hurdles with regard to Government policies and procedures still exist
High domestic and exports demand with annual growth of around 50%
Good education base for software engineers and related studies.
Government’s active encouragement & support by way of tax and duty benefits, promotion of STP Schemes etc.,

Opportunities:

1. Immense opportunities in the Global markets, especially in outsourcing business Is yet to be tapped.

2. Good Domestic Demand Potential

3. Multinationals are increasingly resorting to outsourcing

4. Strong base of UNIX presents lot of scope for developing Internet related products.

5. Multinationals are increasingly setting up shop in India with R & D facilities.

Threats:

1. Inadequate and expensive infrastructure.

2. High inflationary tendencies of cost.

3. Protectionism by developed countries including non-tariff barriers.

DETAILS OF ISSUES DURING THE LAST THREE YEARS BY THE COMPANY AND OTHER COMPANIES UNDER THE SAME MANAGEMENT

No issues have been made by the Company and other companies under the same management during the last three years.

FUTURE PROJECTIONS

The forecast of estimated profits for the financial year ending 31^st March 2001 as estimated by the Lemuria Technologies limited is set out below. The estimates have been certified by M/s N.A.Ramchandran & Co, Chartered Accountants, Chennai, Auditors of the company vide his letter dated June 1^st, 2000 to be arithmetically correct

Particulars	Amount In Lacs
Income	356.00
Expenditure
- Operation & Adm. overheads	156.00
- Staff Overheads	47.00
Total	203.00
PBDIT	153.00
Depreciation	6.58
Preliminary Exps.W/Off	2.20
Net Profit Before Tax	144.22
Provision for Taxation	27.01
Net Profit After Tax	117.21
Share Capital	607.32
EPS*	2.71
Dividend %	15.00

· EPS calculated on annualised basis under the assumption that the expanded equity will be available to the company by 1^st October 2000.

Assumptions :-

1. The above financial forecast for the financial year 2000-2001 is based upon the business plan of the company.

2. Employees remuneration and benefits includes, company’s contribution for statutory retirements benefits

3. Sales are estimated on the basis of existing contracts continued from the previous year, contracted negotiated/ being negotiated with existing clients and contracts under negotiation with clients.

4. Depreciation has been calculated in accordance with schedule XIV of the Companies Act, 1956.

5. Provision for Income Tax has been provided as per Income tax Act, 1961.

STOCK MARKET DATA

As the shares of the Company are yet to be listed on any Stock Exchanges, no quotation for the market price of its shares is available.

BASIS FOR OFFER PRICE

Qualitative Factors

Existing profit-making information Technology Company. The company is involved in Software development and system integration consultancy. The company is specializing in the areas of client –server, component based models, web enabled applications and object oriented technologies. The company has a software development center at Chennai .The Company has developed products mainly for Retail Trade, Travels, based accounting management software. The company has also developed mini ERP solutions to medium range industries and migration of applications from DOS based applications to GUI based applications. The company has also set up web based Intranet solutions to its clients.

Quantitative Factors

1. Basic earnings per share Rs. (EPS)

		EPS(Rs)	Weights Used
a.	31.03.98	0.05	1
b.	31.03.99	0.07	2
c.	31.03.00	0.20	3
Weighted Average for last 3 years			Rs.0.05

2. Price/Earning ratio (P/E ratio) in relation to issue price of Rs.10/- per share based on Rs.0.20 EPS is Rs.50.00

Industry P/E *

i. Highest

ii. Lowest

iii. Average

307.20

1.00

74.60

* Based on Dalal Street Page 30, vol. XV / 12 June 18, 1999

3. Return on Net worth - %

		ROI	Weights Used
a.	31.03.98	0.37%	1
b.	31.03.99	0.71%	2
c.	31.03.00	1.91%	3
Weighted Average for last 3 years			Rs.1.25%

Minimum return on total Net Worth after the issue needed to maintain EPS at Rs. 0.2 is 1.92%

4. Net Assets Value (NAV)

A	As on 31.03.00	Rs.10.48
B	After issue	Rs.10.40
C	Issue Price	Rs.10.00

LITIGATION / DISPUTES / DEFAULTS:

1. There is no pending litigation in which the promoters of the Company are involved.

2. There are no overdues, defaults to the Financial Institutions/Banks, reschedulement of loans to Banks/ FI’s by the Company. There are no pending offences of non-payment of statutory dues by the promoters of the Company.

3. There are no cases of litigation pending against the Company or against any other Company whose outcome could have a materially adverse effect on the position of the Company.

4. There are no pending litigation’s against the Promoters / Directors in their personal capacities and also involving violation of statutory regulations or criminal offences.

5. There are no pending proceedings initiated for economic offences against the Directors, Promoters, Companies and Firms promoted by the promoters.

8. There are no cases of pending litigation/defaults in respect of the firms/ Companies with which the Promoters are associated in the past but are no longer associated.

MATERIAL DEVELOPMENTS

There are no material developments after the date of the latest audited balance sheet as on 31/05/2000, which may materially effect the performance or prospects of the Company other than as stated elsewhere in the offer document

As per the opinion of the Directors, no circumstances have arisen since the date of last financial statement disclosed in the prospectus that materially and adversely affect or are likely to affect the profitability of the Company, or the value of its assets, or its ability to pay its liabilities within the next twelve months.

RISKS IN RELATION TO THE FIRST ISSUE

This being the first issue of the company, there has been no formal market for the securities of the company. The Issue price should not be taken to be indicative of the market price of the equity shares after the shares are listed. No assurance can be given regarding an active or sustained trading in the shares of the Company or regarding the price at which equity shares will be traded after listing.

RISK FACTORS (R) & MANAGEMENT PERCEPTIONS (P)

INTERNAL

1. (R) The Company is yet to apply for the RBI Clearance for setting up a offices in Canada / Singapore for which a sum of Rs. 87.00 lakhs has been set apart in the project cost.

(P) The Company will make an application for setting up of offices in due course and is confident of getting the necessary sanctions as per schedule.

2. (R) This being the first major venture of the promoters, the project suffers from all risks being associated with such start-up ventures.

(P) The Company has started training and recruitment of quality software professionals with relevant background and experience and hence, no adverse impact on operations is foreseen.

4. (R) The company was incorporated in 1991 but commercial operation started after 1996.

6. (R) The Registered office & the corporate office of the company is not in the name of the company and the same has been taken on rent.

(P) The terms and condition of the agreement are reasonable are reasonable and in line with market practice.

7. ( R) The company is yet to place orders for its entire software requirement of Rs. 67.25 lacs

(P) The company has already received quotations from various parties and orders will be placed in due course of time.

8.(R ) The company is yet to identify the additional premises of 4200 sq. ft.

(P) The company is in the process of identifying the additional premises and the same shall be finalised shortly.

EXTERNAL

1. (R) Any adverse change in the Government fiscal policies may affect the performance and profitability of the Company.

2. (R) Selection, Recruitment and Retention of skilled, good quality manpower are crucial factor for the success of a software company.

3. (R) The IT Industry is prone to high risk of Technological Obsolescence.

(P) The Company will setoff the technological obsolescence with continuous updating of the technical skills.

4. (R) The market for software services and products are highly competitive.

(P) The Company is confident that its novel products will find a suitable market in the highly competitive industry.

5. (R) Timely execution of projects has a critical bearing on the cash flows of software companies.

PART - II

A. GENERAL INFORMATION

CONSENTS

Consents in writing of the Auditors, Directors, Bankers to the Company, Bankers to the Issue, Lead Managers, Legal Advisor and Registrars to the Issue to act in their respective capacities have been obtained and filed with the Registrar of Companies, Tamilnadu at Chennai, together with a copy of this Prospectus as required under Section 60 of the Companies Act, 1956 and such consents have not been withdrawn upto the time of delivery of the copy of this Prospectus for registration with the Registrar of Companies, Tamilnadu at Chennai.

M/s N. A.Ramachandran & Co, Chartered Accountants, Chennai, the statutory auditors of the Company, have also given their written consent to the inclusion of their report as appearing hereinafter in the form and context in which it appears in this prospectus and also the tax benefits accruing to the Company and to the Members of the Company and such consent and report have not been withdrawn upto the time of delivery of the copy of this prospectus for registration with the Registrar of Companies, Chennai.

EXPERT OPINION

Except for the various tax benefits available to the Company and its members expressed by the auditors of the Company given elsewhere in the prospectus, the Company has not obtained any other expert opinion.

CHANGE IN THE BOARD OF DIRECTORS

Change in Directors in the last three years is as follows :-

Name	Date of appointment	Date of Resignation	Reasons
N.Nagarajan	25.05.2000	--	To broad base
K.Rajesh	25.05.2000	--	---do--
A.Hamsa	24.03.2000	--	---do

CHANGE IN AUDITORS

There is no change in the auditors of the Company in the last three years.

AUTHORITY FOR THE PRESENT ISSUE

PROCEDURE AND TIME SCHEDULE FOR ALLOTMENT AND ISSUE OF SHARE CERTIFICATES

The Company reserves at its sole, absolute and uncontrolled discretion and without assigning any reasons thereof, the right to accept or reject any application in whole or in part. In case an application is rejected in full, the whole of the application money will be refunded to the applicant. In case an application is rejected in part, the excess application money will be refunded to the applicant within 10 weeks of the closing of the subscription list provided that the Company, as far as possible will allot the equity shares within 30 days from the date of closure of the offer and shall pay interest @ 15 % p.a. for the delayed period if the allotment is not made and/or the refund orders are not dispatched within 30 days from the closure of the offer.

INTEREST ON EXCESS APPLICATION MONEY

Payment of interest at the rate of 15% per annum on the excess application money will be made to the applicants for the delayed period, if any, beyond 30 days from the date of closure of the subscription list, in terms of the provisions of the Companies Act, 1956 and the guidelines issued by the Ministry of Finance vide Letter No. F/8/6/SE/79 dated 21.7.83 and as amended by Letter No.F/14/2/SE/85 dated 27.9.1985 addressed to Stock Exchanges and as further modified by SEBI's circular dated May 15, 1996. No interest will be paid on Stock invest.

APPLICATION OF SECTION 269SS OF THE INCOME TAX ACT, 1961.

In respect of the provisions of Section 269SS of the Income Tax Act, 1961, the subscription against the equity shares should be effected only by an account payee cheque or an account payee draft/stock invest, if the amount payable is Rs. 20,000/- or more. In case the payment is made in contravention of this provision, the application money will be refunded and no interest will be paid.

DELIVERY OF SHARE CERTIFICATES

The Equity Share certificates will be dispatched through registered post within 30 days from the date of allotment in exchange of allotment letters issued, if any, or within such further time as may be allowed by the Chennai Stock Exchange or the Company Law Board as per the provisions of section 113 and other relevant provisions of the Act.

INVESTORS GRIEVANCES REDRESSAL SYSTEM / COMPLIANCE OFFICER

Investor’s grievances pertaining to this issue will be handled by the Registrar to the Issue namely Cameo Corporate Services Ltd.. A fortnightly status report of the complaints received and redressed by them would be forwarded to the Company. The Company would also be co-ordinating with the Registrars to the issue in attending to the grievances of the investors. The Company assures that the following schedules shall be adhered to by the Board of Directors in respect of the complaints, if any, to be received.

The Company has appointed Mr.S.Raja as Compliance Officer who would directly deal with SEBI officer with respect to implementation of various laws, rules, regulations and other directives issued by SEBI and matters related to investor complaints. The investors may contact the compliance officer in case of any pre issue/post issue related problems. The Compliance officer will be available at the registered office of the company

COMPANY INFORMATION AND PUBLIC ISSUE MANAGEMENT TEAM

REGISTERED OFFICE OF THE COMPANY

LEMURIA TECHNOLOGIES LIMITED

C-94, II Floor, Thillai nagar main Road,

Trichy 620 018

Phone: 722149

E-mail: reginfo@lemuriatech.com

CORPORATE OFFICE

No.97, Harrington Road,

Shenoy Nagar

Chennai : 600 030

LEAD MANAGER TO THE ISSUE

ARYAMAN FINANCIAL SERVICES LTD.

(SEBI Regn. No.: INM 00000 6807)

35,Atlanta,III floor, Nariman point

Mumbai-400021

Ph: 2826465,2826466,2883134

Fax: 022-2826467

E-Mail: aryaman@bom2.vsnl.net.in

REGISTRAR TO THE ISSUE

Cameo Corporate Services Ltd.

(SEBI Regn.No.: INR 00000 3753)

Subramaniam Building, No1, Club House Road,

Chennai-600002

Ph: 8528390(5 lines)

Fax: 044-8520129

COMPANY SECRETARY

The Company has not appointed a Company Secretary as required U/s 383A of the Companies Act, 1956. However, the Company is in the process of appointing a Company Secretary.

COMPLIANCE OFFICER

Mr. Raja

LEMURIA TECHNOLOGIES LIMITED

97, Harrington Road, Chennai-600 030

Phone : (044)6612753

Email : compliance@lemuriatech.com

AUDITORS

N.A.Ramachandran & co

Chartered Accountant

Madley Road,

T.Nagar, Chennai – 600 017

Ph: (044) 4347338

LEGAL ADVISOR TO THE COMPANY & ISSUE

Mr. Pandurangan

Madras High Court Advocates Association

High Court Building

Chennai - 600 001

Ph: (044) 534 1646

BANKERS TO THE COMPANY

INDIAN BANK

Kilpauk Branch

10, New Avadi Road,

Chennai – 600 010

BANKERS TO THE ISSUE

B. FINANCIAL INFORMATION

AUDITORS REPORT

The Board of Directors,

LEMURIA TECHNOLOGIES LIMITED

C94, II floor, Thillai Nagar Main Road

Trichy 620 018.

Ref.: Your Proposed public Issue

Dear Sir,

We have examined and Audited the Books of Accounts of M/s. Lemuria Technologies Limited for the year ended from 1^St April to 31^stMarch 1996-97,1997-98, 1998-99, 1999-2000 and 31/05/2000 being the last day up to which the account of the Company have been made up and audited by us. In accordance with the requirements of Clause B (1) of part II of Schedule II of the Companies Act, 1956 we report that :-

A. PROFITS OF THE COMPANY

The profits of the Company for the year ended 31/03/97,31/03/98, 31/03/99, 31/03/2000 and 31/05/2000 after making such adjustments as are in our opinion, appropriate and subject to the notes hereunder are as follows :-

STATEMENT OF PROFIT & LOSS ACCOUNT

					(Rs. In Lacs )
Particulars	1997	1998	1999	2000	As on 31/05/2000
Income

Income	0.50	8.42	9.12	36.05	20.08
Other Income	0.00	0.00	0.00	0.00	0.00
Total Income	0.50	8.42	9.12	36.05	20.08

Expenditure
Operation & Administration	0.17	1.87	2.04	20.59	8.37
Employees remuneration	0.30	5.39	5.39	7.83	2.89
Interest & Finance Charges	0.00	0.00	0.00	0.00	0.00
Depreciation	0.06	0.52	0.61	1.06	0.18
Prel & Preoperative W/off	-	0.09	0.00	0.00	0.00
Total expenditure	0.52	7.87	8.04	29.48	11.44
Net profit before tax	(0.02)	0.55	1.08	6.57	8.64
Income Tax	0.00	0.10	0.20	1.53	2.75
Net profit after tax	(0.02)	0.45	0.88	5.04	5.89
Dividend	-	-	-	-	-

B. ASSETS & LIABILITIES

The Assets and Liabilities of the Company as on 31^st March 1997, 1998,1999 and 2000 and 31/5/2000 after making such adjustments as are in our opinion, appropriate and subject to the notes hereunder are as follows :-

(Rs. In Lacs)

Year ended 31st March	1997	1998	1999	2000	As on 31/05/2000
SOURCES OF FUNDS

Shareholders fund
Share Capital	121.82	121.82	121.82	257.32	257.32
Reserves and Surplus	(0.02)	0.43	1.31	6.35	12.24
Loan Fund
Secured Loan		-	-	-	-
Unsecured Loans		-	-	-	-
Total Liabilities	121.80	122.25	123.13	263.67	269.56

APPLICATION OF FUNDS

Fixed Assets (less Depreciation)	1.22	2.87	3.70	5.14	155.56
Investments	-	-	-	-	-
Current assets, loans & advances
Inventories and Work in process	74.00	87.20	108.22	209.50	214.63
Sundry Debtors		0.44		15.20	21.06
Cash and Bank balance	0.08	0.16	0.10	0.52	1.07
Loans and Advances	46.50	33.30	12.28	45.50	20.37
Deposit
Sub total	120.58	121.10	120.60	270.72	257.13
Less: Current Liabilities & Provision	0.09	1.72	1.17	12.19	13.13
Net Current Assets	120.49	119.38	119.43	258.53	244.00
Misc. Expenditure	0.09
Total assets	121.80	122.25	123.13	263.67	269.56

C. DIVIDEND

No dividend has been declared or paid by the Company since incorporation.

SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS

i. Basis of Accounting: The Financial statements are prepared following the accrual basis and historical cost convention and materially complies with the accounting standards issued by the Institute of Chartered Accountant of India and are in accordance with the requirement of the Companies Act, 1956.

ii. Significant items of income and expenditure on an accrual basis.

iii. Income Recognition:

Revenue from Software Sales is recognized on proportionate completion method and on the basis of invoices raised as per the terms of the contract.

iv. Fixed Assets & Depreciation: Fixed Assets are stated at cost of acquisition less accumulated depreciation. Depreciation has been provided on WDV method at the rates specified in schedule XIV to the Companies Act, 1956, Depreciation on addition is provided from the month of installation & depreciation on sale of Assets is provided till the month of sale.

v. Valuation of Inventories: Stock of Raw Materials, Stores and Finished Goods are valued at lower of cost or market value and work-in-process is valued at cost.

vi. Investments: Not applicable

vii. Product Development Expenses: Expenditure relating to the development of products is accumulated. It is capitalised on establishment of commercial viability. The same is depreciated over 3 to 5 years depending upon the estimated life of the product.

viii. Contingent Liabilities – Not Applicable

ix. Notes on Accounts:

1. Figures of the previous year have been regrouped and rearranged wherever necessary to make them comparable with classification of the current year.

2. Company has yet to obtain confirmations in respect of Sundry Debtors, Loans & Advances, Sundry Creditors, Sundry deposits and other Liabilities. If any adjustment is necessary in the Accounts, the same will be made on the receipt of confirmations.

3. In the opinion of the Board, the Current Assets, Loans & Advances are approximately of the value stated, if realized in the ordinary course of business. The provisions for depreciation and for all known Liabilities is adequate and not in excess of the amount reasonably necessary.

4. Expenditure in Foreign Currency ---- Rs. Nil.

5. Earnings in Foreign Currency ---- Rs. Nil.

For N.A Ramchandran & Co.

Chartered Accountants

Sd/-

N.A. Ramchandran

Proprietor

Date : 01/06/2000

Place : Chennai

STATE MENT OF TAXATION

As per the auditors letter dated 15.06.2000

(Amount in Rs)

Year ended 31^st March	96-97	97-98	98-99
Net Profit as per P & L A/c	(2253)	54815	108008
Tax as nominal rate	Nil	19185	37803
Adjustments :
Diff between tax dep & Book dep	9282	26465	83500
Other adjustment	Nil	Nil	Nil
Net adjustments	9282	26465	83500
Tax Savings thereon	Nil	9282	26462
Total Taxation	Nil	9923	11341

Notes :

Net profits are considered as per audited accounts

Total tax paid is calculated after considering section 115 of the Income Tax Act.

Income Tax rates are considered as per the prevailing Income Tax rates of the respective years

CAPITALISATION STATEMENT

(Rs in Lacs)

Particulars	Pre-Issue as on 31.03.2000	Post Issue

Short Term Debt	--	--
Long Term Debt	--	--
Shareholders Fund
Share Capital	257.32	607.32
Share Application Monies	0.00	0.00
Reserves	6.34	6.34
Total Shareholders Fund
Short Term Debt / Equity	--	--
Long Term Debt / Equity	--	--

C. STATUTORY AND OTHER INFORMATION

MINIMUM SUBSCRIPTION

IF THE COMPANY DOES NOT RECEIVE THE MINIMUM SUBSCRIPTION OF 90% OF THE ISSUED AMOUNT, ON THE DATE OF CLOSURE OF THE ISSUE OR IF THE SUBSCRIPTION LEVEL FALLS BELOW 90% AFTER THE CLOSURE OF THE ISSUE ON ACCOUNT OF CHEQUES HAVING BEEN RETURNED UNPAID OR WITHDRAWAL OF APPLICATIONS, THE COMPANY SHALL FORTHWITH REFUND THE ENTIRE SUBSCRIPTION AMOUNT RECEIVED. IF THERE IS A DELAY BEYOND 8 DAYS AFTER THE COMPANY BECOMES LIABLE TO PAY THE AMOUNT, THE COMPANY SHALL PAY INTEREST AS PER SECTION 73 OF THE COMPANIES ACT, 1956.

EXPENSES OF THE PRESENT ISSUE

The expenses of the present issue, fees to the Lead Managers and Registrars to the Issue, Stamp duty, Printing and stationery, distribution and publication expenses, legal and professional charges, listing fees, bank charges, Auditors fees and other miscellaneous expenses will be met out of the proceeds of the issue. The expenses towards the present issue is estimated to be Rs. 22.50 lacs, which would be met form the public issue proceeds.

FEES PAYABLE TO THE LEAD MANAGERS TO THE ISSUE

The fees payable to the Lead Managers to the Issue,(apart from reimbursement of actual out of pocket expenses) for issue management as set out in their offer letter, copies of which are kept open for inspection at the Registered Office of the Company.

FEES PAYABLE TO THE REGISTRARS TO THE ISSUE

The fees payable to the Registrars to the Issue as set out in their offer letter, copies of, which are kept open for inspection at the Registered Office of the Company.

UNDERWRITING COMMISSION AND BROKERAGE

The offer is not being underwritten hence, no underwriting commission is payable.

Brokerage will be paid by the Company @ 1.5% on the equity shares on the basis of allotment made against applications bearing the stamp of a member of any recognised stock exchange of India in the brokers column in the application form. Brokerage at the same rate will also be payable to the bankers to the offer in respect of allotment made against applications procured by them provided applications forms bear their respective stamps in the brokers column. In case of tempering or over stamping of the broker codes on the application form, the Company’s decision to pay brokerage in this respect will be final and no further correspondence will be entertained in this matter.

PREVIOUS OFFER OF CAPITAL DURING LAST FIVE YEARS

The Company has not made any public offer of equity/debentures previously. The details of issue of capital have been outlined in the paragraph on the build up of the share capital under the capital structure.

PREVIOUS COMMISSION AND BROKERAGE

No sum has been paid by the Company since its incorporation or is payable as commission for subscribing or procuring or agreeing to subscribe or procure subscription for any shares or debentures of the Company.

PREVIOUS OFFER OF SHARES OTHERWISE THAN FOR CASH

No shares has been issued by the company for consideration other than cash.

RIGHTS OF THE EQUITY SHAREHOLDERS

The Equity Shares now being issued are subject to the terms of this Prospectus, the Application Form, Memorandum and Articles of Association of the Company, the Guidelines issued by the Government of India and the SEBI from time to time and the Companies Act, 1956. These new equity shares shall rank pari-passu with the existing issued equity shares of the Company in all respects except that the Equity Shares issued will be entitled to dividend, if any, which may be declared or paid on the Equity Shares, on a pro-rata basis from the date of allotment. Shareholders are entitled to receive dividend as and when declared, Bonus and Rights shares as and when made. Further the rights of the above and other holders of the instruments are subject to the provisions of Section 206A of the Companies Act, 1956 and other laws applicable from time to time.

PREFERENCE SHARES AND DEBENTURES

The Company has not issued any preference shares or debentures since its incorporation.

CAPITALISATION OF RESERVES AND PROFITS

There has been no capitalisation of reserves or profits since its incorporation.

ISSUE AT A PREMIUM OR DISCOUNT

No shares of the Company have been issued at either a premium or at a discount since its incorporation.

PRESENT AUTHORISED SHARE CAPITAL / CLASS OF SHARES

The present Authorised Share Capital of the Company is Rs. 675.00 Lacs and it has only one class of shares viz. Equity Shares of nominal value of Rs. 10/- each.

OPTION TO SUBSCRIBE

The investor has an option either to receive the security certificate or to hold the securities with depository. Except as otherwise stated in this prospectus, the Company has not entered into nor does it at present propose to enter into any contract or arrangement whereby any option or preferential right of any kind has been or is proposed to be given to any person to subscribe to any shares or debentures of the Company.

CLASSES OF SHARES

The authorised share capital of the Company consists of 6,75,000 equity shares of Rs. 10/- each. The Company has not issued any preference shares to date.

PRELIMINARY AND PRE OPERATIVE EXPENSES

The Company as on 15.06.2000 has incurred Rs.5.50 lacs towards preliminary expenses.

PURCHASE OF PROPERTY

Save in respect of the property purchased or acquired or proposed to be purchased or acquired under the contract referred to herein below under the heading Material Contracts and Documents for inspection, there is no property which the Company has purchased or acquired or proposes to purchase or acquire which is to be paid, wholly or partly out of the proceeds of the present issue or the purchase of acquisition of which has not been completed on the date of issue of this prospectus other than the following :-

a. The contract for the purchase or acquisition whereof was entered into in the ordinary course of the company's business, the contract not being made in contemplation of the issue in consequence of the contract.

b. In respect of which the amount is not material. Except as stated in this prospectus the Company has not purchased any property in which any of its promoters or directors has or have any direct or indirect interest or in respect of any payment thereof.

INTEREST OF DIRECTORS AND PROMOTERS

Except as otherwise stated elsewhere in this Prospectus, all the Directors may be deemed to be interested to the extent of remuneration and fees payable to them for attending the meeting of the Board or Committee thereof and reimbursement of travelling and other incidental expenses, if any, for such attendance’s as per the Articles. All the Directors/ Promoters of the Company shall be deemed to be interested to the extent of shares held by them and/or their friends and relatives and which may be allotted to them out of the present issue, and are deemed to be interested to the extent of remuneration and perquisites being drawn by them from the Company.

PAYMENT OR BENEFIT TO PROMOTERS AND OFFICERS OF THE COMPANY

Save as stated elsewhere in this prospectus no amount or benefit has been paid or given since the incorporation of the Company nor is intended to be paid or given to any Promoter, Director, or Officer of the Company except in respect of normal remuneration or benefits or reimbursement of expenses incurred on behalf of the company.

CAPITALISATION OF RESERVES OR PROFITS

There has been no capitalisation of Reserves or Profits of the Company since its incorporation.

BONUS ISSUE & REVALUATION OF ASSETS

There has been no revaluation of the assets since incorporation of the Company.

D. THE MAIN PROVISIONS OF ARTICLES OF ASSOCIATION OF THE COMPANY

SHARE CAPITAL

The Authorised Share Capital of the Company is Rs.6,75,00,000/-(Rupees Six Crores Seventy Five Lakhs only) divided into 67,50,000 (Sixty Seven Lakhs and Fifty Thousand) equity shares of Rs.10/-(Rupees Ten only) each, capable of being increased in accordance with the Company's regulations and the legislative provisions for the time being in force in that behalf.

4. Alteration of Conditions of Memorandum

The Company in general meeting is authorised to alter the conditions of its Memorandum as follows, that is to say, it may from time to time by ordinary resolution:-

1. Increase its share capital by such sum, to be divided into shares of such amount, as may be specified in the resolution.

2. Indicate that the new shares be issued upon such terms and conditions and with such rights and privileges annexed thereto as may be specified in the resolution sanctioning the increase of share capital.

3. Indicate that except so far as otherwise provided by the conditions of issue or by these presents, any capital raised by the creations of new shares shall be considered part of the original equity capital and shall be subject to the provisions herein contained with reference to the payment of calls and installments, transfer and transmissions, forfeiture, lien voting and otherwise.

a. Consolidate and divide all or any of its share capital into shares of larger amount than its existing shares.

b. Convert all or any of its fully paid-up shares into stock, and convert the stock into fully paid up shares of any denomination. Sub-divide its shares or any of them into share of smaller amount than is fixed by the Memorandum, so however, then in the sub division the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced share is derived.

Increase of Subscribed Capital

5.The Board may, at any time increase the subscribed capital of the company without referring to the share holder to the extent of the authorised share capital by issue of new shares, and the Directors shall comply with the provisions of the Act.

Reduction of Share Capital

6. Subject to any incident, authorised and consent required by law, the company is authorised to reduce its share capital by Special Resolution in any way and in particular and without prejudice to the generality of the forgoing power, may: -

a. extinguish or reduce the liability on any of its shares in respect of share capital not paid up; or

b. with or without extinguishing or reducing liability of any its shares , cancel any paid-up share capital which is lost or is unrepresented by available assets; or

c. Either with or without extinguishing or reducing liability or any of its shares, cancel any paid-up share capital which is in excess of the wants of the company, and may, if so far as is necessary alter its Memorandum by reducing the amount of its share capital and of its shares accordingly; or

d. Reduce any share premium account, and

e. Reduce any Capital Redemption Reserve Fund account.

VARIATION OF SHARE HOLDERS RIGHTS

Division of Shares into Several Classes

9. The share in the capital of the Company for the time being whether with any preferential , qualified or other special rights, privileges, conditions or restrictions attached thereto, whether in regard to dividend voting, return of capital or otherwise.

Modification of Rights

(a) Whether the capital by reason of the issue of preference Shares or otherwise is divided into different classes of shares, all or any of the rights and privileges attached to any class(unless otherwise provided by the terms of issue of the shares of that class) may be modified, commuted, affected, abrogated or dealt with by agreement between the Company and any other person purporting to contra Act on behalf of that class, provided such agreement is ratified in writing by holders of at least three-fourth of those shares, and all these provisions herein after contained as to General Meeting shall mutatis mutandis apply to every such meeting but so that the quorum thereof shall be two members present in person or y proxy and holding tow-thirds of the nominal value of the issued shares of that class. This article is not derogative of any power of the company would have had if this clause were omitted. The power conferred upon the company by this clause is subject to Sections 106 & 107 of the Act.

Conditions under which rights varied by creation of further shares

(b) The rights conferred upon the holders of the shares of any cause issued with preferred or other rights shall not unless otherwise provided by the terms of issue of the shares of that clause, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

SHARES AND CERTIFICATES

Shares To Be Numbered Progressively

13. Each share in the capital of the Company shall be distinguished by its appropriate number called the distinctive number and the shares or any other interest of any member in the company shall be movable property, transferable in the manner provided by the Articles of the Company.

Shares under the Control of Directors

14. Subject to the provision of these Articles and of the Act, the shares in the capital of the Company for the time being (including any shares forming part of any increased capital of the company) shall be under the control of the Directors, who may allot or otherwise dispose of the same to such persons on such terms and conditions and at such times as the Directors think fit and with the sanction of the Company in General Meeting to give any person the option to call for or be allotted shares of any class of the Company either (subject to the provision of Section 78 and 79 of the Act) at a premium or at par or at a discount and for such time and for such consideration as the Directors think fit.

Issue and allotment of share for consideration other than cash

15. Subject to the provisions of the Act, and these articles, the Directors may issue and allot shares in the capital of the company as partly or fully paid in consideration of any property sold or goods transferred or machinery supplied or for services rendered to the company in the conduct of its business, and any shares which may be so allotted may be issued as fully or partly paid-up shares, otherwise than in cash and so issued shall be deemed to be fully or partly paid-up shares as aforesaid.

Certificates of Shares

16. Every share certificate shall be issued under the common seal of the company in accordance with the provisions of the companies ( Issue of share certificate) rules, 1960 or any modifications thereof for the time being in force either in physical form or in electronic form.

16(a) Demateralisation of Securities

Notwithstanding any thing contained in these Articles, the company shall be entitled to Demateralised its securities in a DEMATERALISED form pursuant to the Depositories Act, 1996.

Option to Investors

Every person subscribing to securities offered by the company shall have the option to receive Securities Certificates or to hold the securities with a depository. Such a person who is the beneficial owner of the securities can at any time opt out of a depository, if permitted by the law, in respect of any security in the manner provided by the Depositories Act, and the company shall in the manner and within the time prescribed issue to the beneficial owners the required certificate of securities.

If a person opts to hold his security with a depository the company shall intimate such depository the details of allotment of the security, and on receipt of the information, the depository shall enter in its record the name of the allotee as the beneficial owner of the security.

Securities in depositories to be in fungible form

All securities held by depository shall be DEMATERALISED and be in fungible form. Nothing contained in section 153,153 A, 153 B, 187 B, 187 C and 72 A of the Act shall apply to a depository in respect of the securities held by it on behalf of the beneficial owners.

Member entitled to certificate for shares Registered in his name

17. Every member or allottee of share(s) shall be entitled without payment of any fee receive share certificate(s) in marketable lots under the seal of the company of the shares of each class or denomination Registered in his name in such form as the Directors shall prescribe or approve, specifying the share or shares allotted to him and the amount paid thereon. If however, share certificate(s) is/are found to be issued for either more or less than marketable lots, subdivision/consolidation into marketable lots, if necessary shall be done free of charges.

Endorsement of Transfer

18. Every endorsement of transfer in favour or any transferee there of or on payment of a call, upon the certificate of any share shall be singed by a Director or Secretary or any other person for the time being duly authorised by the Directors in that behalf.

Renewal of certificates

19. If any certificate by worn our or defaced, or if there is no further space on the back thereof for endorsement of transfer, then upon production of the same to the Directors, they may order the same to be cancelled, any may issue a new certificate in lieu thereof, any if any certificate be lost or destroyed then upon proof thereof to the satisfaction of the Directors and on such indemnity (if any) as the Directors seem adequate being given, a new certificate in lieu thereof shall be given to the persons entitled to such lost or destroyed certificate such sum (if any) not exceeding one rupee, as the Directors may determine shall be paid to the company for every certificate for every so issued under this clause. Provided that no fees shall be charges for issue if new certificates in replacement of those which are old, decrepit or worn out or where there is no further space on the back thereof for endorsement of transfer.

JOINT HOLDERS OF SHARES

The First Named of Joint-Holders Deemed Sole Holder

20. When two or more persons are Registered as the holders of any share they shall be deemed to hold the same as joint-tenants with the benefit of survivor-ship subject to the following provisions and other provisions contained in the articles:

(a)The joint-holders of share shall be liable severally as well as jointly in respect of all payment which ought to be made in respect of such share.

(b)On the death of any one of such joint holders, the survivor or survivors shall only be person or persons recognized by the company as having any title to such share, but the Directors may require such evidences of death as they may deem fit.

(c)Only the person whose names stands first in the Register as one of the Joint-holders of any share shall be entitled to delivery of the certificate relating to such share.

Company not bound to issue more than one certificate

21. In respect of any shares held jointly by several persons, the company shall not be bound to issue more than one certificate and delivery of a certificate of shares to one of the several joint holders shall be sufficient.

CALLS

Board may make Calls

22. The Board may, from time to time (by a resolution passed at a meeting of the Board and not by circular resolution) but subject to this conditions hereinafter mentioned in Articles 22 to 30 make such calls as they may think fit, upon the members in respect of all money unpaid on the shares held by them, respectively ( Whether on account of the nominal value of shares or y way of premium) and which are not, by the conditions of the allotment thereof, made payable at fixed times and each member shall pay the amount of every call so make on him to the persons and at the times appointed by the Board. A call may be made payable by installments.

Notice of call

23. At least thirty days of notice of any call shall be given by the company specifying the time and place of payment and the person to whom such call shall be paid.

Call when deemed to have been made

24. A call shall be deemed to have been made at the time when the resolution of the Board authorising such call was passed or at the discretion of the Board of such subsequent date as shall be fixed by the Board any may be made payable by the members whose names appear in the Register of members on such date.

Extension, Postponement and Revocation of call

25. The Board may, from time to time at its discretion extend the time fixed for the payment of any call or change the place where the call is to be paid and may extend such time as to all or any of the members who on account of residence being at a distance or some other cause, may be deemed fairly entitle to such extension but no member shall as a matter of right, be entitle to such extension, save as a matter of grace and favour. A call may be revoked or postponed at the discretion of the Directors.

Payment of interest on non-payment of call

26. If a sum called in respect of shares is not paid before or on the day appointed for payment thereof, the person form whom the sum is due shall pay interest upon the sum at the fixed by the Board of Directors not exceeding 18% (eighteen percent) per annum form the day appointed for the payment but the Board of Directors shall be at liberty to waive payment of that interest wholly or in part.

Judgement Decree or partial payment not to preclude forfeiture

27. Neither the receipt by the company of any money which shall, form time to time, be due from member to the company is respect of his shares, either by way of principal or interest, nor any indulgence granted by the court in respect of the payment of any such money preclude the company form thereafter proceeding to enforce a forfeiture of such share as here to after provided for non-payment of the whole or any balance due in respect of the shares.

Amount payable at fixed time or by installments

28. If by the terms of issue of any share of otherwise any amount is made payable at any fixed time or by installments at fixed time (whether on account of the amount of the share of by way of premium), every such amount or installment shall be payable as if it were a call duly made by the Board and of which due notice had been given, and all the provisions herein contained in respect of calls shall relate to such amount or installment accordingly.

Interest on advance payment of calls

29. The Board of Directors, may if it thinks fit, subject to the provision of Section 92 of the Act, receive from any member willing, to advance the same, all or any part of the money uncalled and unpaid upon any shares held by him, and upon all or any of the money so advance, may (until the same should, but for such advance, become payable) pay interest at such rate not exceeding, unless the company in General Meeting shall otherwise direct, fifteen percent per annum (15%), or as may be agreed upon between the Board and the member paying the sum in advance, but shall not in respect of such advance s confer a right to the divided or to participate in profits, or to any voting rights.

Liability of Joint Owners

30. The joint Owners of any share shall be severely as well as jointly liable for the payment of installment of all calls and other payments due in respect of any share.

TRANSFER AND TRANSMISSION OF SHARES

Instrument of Transfer

31. The instrument of transfer of any share shall be in writing and in such form as shall from time to time be permissible to be used under the relevant provisions of the Act, in that behalf, specific instrument for each class. The transfer/transmission/sub-division or consolidation of shares shall be effected within one month of the lodgment of document.

31(a) Transfer of Securities

Nothing contained in section 108 of the Act or these Articles shall apply to a transfer of securities effected by a transfer or and transferee both of whom are entered because of beneficial owners in the records of a depository.

32. Separate instrument of transfer shall be executed for each class of shares.

Execution of Transfer

33. The Board shall decide to Register a transfer of shares unless a proper instrument of transfer duly stamped and executed by or on behalf of the transferor as well as the transferee and specifying the name and address and occupation, if any, of the transferee has been delivered to the Company, along with the Certificate relating the shares and such other evidence as the Board of Directors may reasonably require to show the right of the transferor to make the transfer and the transferor shall be deemed to remain the holder of such share until the name of the transferee is entered in the Register of members in respect thereof. All the provisions of Section 108 of the Companies Act, for the time being shall be duly complied with in respect of all transfer of shares and the registration thereof.

Provided that where, on an application in writing made to the Company by the transferee and bearing the stamp required for an instrument of transfer, it is proved to the satisfaction of the Board of Directors that the instrument of transfer signed by or on behalf of the transferor and by or on behalf of the transferee ahs been lost, the Company may Register the transfer on such terms as to indemnity as a Board may think fit.

Fee for Transfer

34. No fee shall be changed for issue of new shares/debentures certificates in replacement of those which are old, decrepit, worn out or where the cages on the reverse for recording transfers have been fully utilized. No fee shall be charges for transfer of shares/debentures or for effecting transmission or for Registering any letters of probate, letters of administration and similar other documents.

35. Where an application for transfer is made by the transferor, no registration shall in the case of partly paid shares be effected unless the Company gives notice of the application to the transferee by prepaid Registered post and in accordance with the provisions of Sections 110 of the Act. The Directors may, unless objection is made by the transferee, within two weeks from the date of receipt of the notice enter the name of transferee in the Register of members in the same manner and subject to the same conditions as if the application for registration was made by the transferee.

Transferor Holder till Transferee's Name Entered in Register

36. The transferor shall be deemed to remain the holder of such share (or share) until the name of transferee is entered in the Register of Members in respect thereof.

Board's Right to Refuse to Register

37. The Board may, at their absolute discretion and without assigning any reason, decline to Register;

(1) The transfer of any share whether fully paid or not to a person to whom they do not approve or

(2) Any transfer or transmission of shares on which company has lien or

(3) Where the transfer is in respect of shares which are not pin Marketable lots as per the Regulations of the Stock Ex-change.

Provided that registration of any transfer shall not be refused on the ground of the transferor being either alone or jointly with any other person or persons indebted to the company on any account whatsoever except a lien on the shares.

(a) If the Board refuses to register any transfer or transmission of right they shall within two months from the date on which the instrument of transfer of the intimation of such transmission as the case may be.

(b) In case of refusal by the Board, the decision of the Board shall be subject to the right of the appeal conferred by Section 111, sub clause (3).

Board to Return the Instrument in Case of Rejection of Transfer

38. All instruments of transfer which shall be Registered shall be retained by the Company but any instrument of Transfer which the Board may decline to Register shall be returned to the person depositing the same.

Closure of Register of Members and Register of Debenture Holders

39. The Directors shall have power to close the transfer books and the Register of members and the Register of Debenture-holders at such time, or times for such period or periods, not exceeding in the aggregate of forty-five days in each year but not exceeding thirty days at one time as may seem expedient to them, by giving not less than seven days notice by advertisement in any newspaper circulating in the district in which the Registered Office of the company is situated.

Transmission Clause

40. In case of death of any one of the persons named in the Register of Members as the joint-holders of any shares, the survivor or survivors shall be the only persons recognised by the Company as having any title to or interests in such share, but nothing herein contained shall be taken to release the estate of a deceased joint-holder from any liability on shares held by him jointly with any other person.

Transmission of Shares

41. The executors or administrators of a deceased member not being one of two or more joint-holders, shall be the only persons recognised by the Company as having any title to the shares Registered in the name of such member, and the Company shall not be bound to recognise such executors or administrators unless such executors or administrators, shall have first obtained probate or Letters of Administration, as the case may be from a duly constituted Court in India, provided that in any case, where the Directors, in their absolute discretion think fit, they may dispense with the production of probate of Letters of Administration and under the next Article Register the name of any person who claims to be absolutely entitled to the shares standing in the name of the deceased member, as a member.

Board May Require Evidence of Transfer and Transmission

42. Any person becoming entitled to a share in consequence of the death, lunacy, bankruptcy or insolvency

Of any member or marriage of any female members or by any lawful means other than by a transfer in accordance with these presents, may with the consent of Directors(which they shall not be under any obligation to give), upon producing of the grant of probate or letters of administration or succession certificate or such other evidence acceptable by the Board such evidence that he sustains the character in respect of which he proposes to Act under this article or of his title, as the Board thinks sufficient may either Register himself as the holder of the shares or elect to have some persons nominated by him and approved by the Board Registered as such holder, provided nevertheless that if such person shall elect to have his nominee Registered he shall testify the election by executing to his nominee an instrument of transfer in accordance with the provisions herein contained and until he does, he shall bot be free from any liability in respect of the shares.

Board's Right to refuse transmission.

43. The Directors shall have the same right of refuse to register a person entitled by transmission of any share or his nominee, as if he were the transferee named in any ordinary instrument of transfer presented for registration. No liability of the company giving effect to transfer inspite of notice received prohibiting registration of transfer.

44. The company shall incur no liability or responsibility whatever in consequence of its Registering or giving effect to any transfer of shares made or purporting to be made by any apparent legal owner thereof ( as shown or reappearing in the Register of members ) to the prejudice of persons having or claiming any equitable right, title or interest in the same share notwithstanding that the Company may have had entered such notice prohibiting registration of such transfer and may have entered such notice referred thereto in any book of the Company and the Company shall not be bound or required to regard or attend to give effect to any notice which may be given to it of any equitable right, title, or interest, or be under any liability whatsoever for refusing or neglecting to do so, though it may have been entered or referred in some book of the Company, but the Company shall nevertheless be at liberty to regard and attend to any such notice and give effect thereto if the Board shall so think fit.

Devolution on the Death of A Shareholder

45. A person entitled to share by reason of the death or insolvency of the holder shall be entitled to the same dividends and other advantages to which he should be entitled if he were the Registered holder of the share, except that he shall not, before being Registered as a member in respect of the share, be entitled in respect of it to exercise any right conferred by membership in relation to meeting of the Company. Provided that the Board may, at any time, give notice requiring any such person to elect either to be Registered himself or to transfer the share and if the notice is not complied within ninety days, the Board may thereafter withhold payment of all bonuses or other money payable in respect of the share until the requirements of the notice have been complied with.

LIEN OF SHARES

Company's Lien of Shares

56. Subject to the provisions of the Act , the company shall have a first and paramount lien on all the shares including fully paid up shares Registered in the name of each member (whether they solely or jointly with others) and upon the proceeds of sale thereof for all moneys called or payable at a fixed time in respect of such shares whether the period for the payment ,fulfillment or discharges thereof shall have Actually arrived or not and no equitable interest in any share shall be created except upon the footing and condition that this article is to have full effect. And such lien shall extend to all dividends and bonus from time to time declared in respect of such shares ,unless otherwise as a waiver of the company lien,if any, on such shares.

Enforcing Lien of Shares

57. For the purpose of enforcing such lien, the Board may sell the shares subject thereto in such manner as they shall fit ,but no sale shall be made until a notice in writing of the intention to sell has been served on such member or the person (if any) entitled to the transmission to the shares or his representative and default has been made by him in fulfillment or discharges of such debts , liabilities or engagement in respect of such shares for fourteen days after such notice. To give effect to any such sale the Board may authorise some person to transfer the shares sold to the purchaser thereof.

Application of Proceeds Of Sale

58. The net proceeds of such sale after payment of the costs of such sale be applied in or towards satisfaction of such debts,liabilities or engagements of such members and the balance shall, subject to a like lien for sums not presently payable as exists upon the shares before the sale be paid to such member , his legal representative or assigns or the person (if any) entitled by transmission to the shares so sold.

FORFEITURE OF SHARES

Notice may be given for nonpayment of call or installment

59. If any member or his legal representative as the case may be ,fails to pay the whole or any part of any call or installment or money due in respect of any shares either by way of principal or interest on call or before the days appointed for the payment of the the same or any such time as the call or installment or any part thereof and other moneys remaining unpaid or a judgement or decree in respect thereof remaining unsatisfied in whole or in part ,serve a notice on such member or his legal representative or the person entitled to the share by transmission, requiring him to such call or installment or such part thereof or other moneys as remain unpaid together with any interest that may have been incurred by the co., by reason of such non payment.

Form of notice

60. The notice shall name a day and a place or places at which such calls or installments or such part and other monies if any and such interest and expenses as aforesaid are to be part and other monies if any and such interest and expenses as aforesaid are to be paid and if payable to any person other than the co., the person to whom such payment is to be made. The notice shall also state that in the event of the non payment before the time and at the place appointed, the share in respect of which the call was made, or installment is payable will be liable to be forfeited.

If Notice not compiled with ,shares may be forfeited

61. If the requirements of any such notice as aforesaid have not been compiled with every or any shares in respect of which such notice has been given,may at any time thereafter before payment of all calls or installments ,interest and expenses and other dues in respect thereof be forfeited by a resolution of the Board to that effect. Such forfeiture shall include all dividends and bonus shares if any declared in respect of the forfeited shares and not Actually paid before the forfeiture.

62. When any share has been so forfeited, notice of the resolution, shall be given to the member in whose name it stood immediately prior to the forfeiture, and an entry of the forfeiture with the date thereof, shall be in any manner invalidated by any omission or neglect to give such notice or to make such entry as aforesaid.

63. Any share so forfeited under these Articles shall be seemed to be the property of the Company and be sold or re-allotted or otherwise disposed off either to the original holder thereof or to any other person, upon such terms and in such manner as the Board shall think fit.

64. The forfeiture of a share shall involve the extension of all interest in and also of all claims and demands against the Company in respect of the forfeited shares and all other rights incidental to the share ,except only such of these rights as these Articles are expressly saved.

65. Any member whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, not withstanding the forfeiture, be liable to pay and shall forthwith pay to the Company all calls, installments, interest and expenses and until payment date together with interest at such rate not exceeding fifteen per cent annum as the Directors may determine and the Directors may determine and Directors may enforce the payment thereof if they think fit. (a).The liability of such person shall cease if when the Company receives payment in full of such moneys in respect of such forfeited shares.

66. The Board of Directors may subject to the provisions of the Act , accept the surrender of any share from or by any member desirous of surrendering by way of compromise of any question as to the holder being properly Registered in respect thereof or on any other terms they think fit.

67. Upon any sale after forfeiture or surrender or for enforcing a lien purported to have been exercised by virtue of the powers herein before given, the Board may appoint some persons to execute an instrument of transfer of the shares sold and cause the purchaser's name to be entered in the Register of members in respect of the shares sold and issue a new certificate or such shares distinguishing them in such manner as they think fit and the Company may receive the consideration if any, given for the share on any sale, re-allotment or other disposition thereof and the person to whom such share is sold , re-allotted or disposed off may be registered as the holder of the share, his title to the share is not affected by any irregularity or invalidity in the proceedings in reference to the forfeiture , sale, shall not be impeached by any person. A duly verified declaration shall constitute a good title and shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the shares. The remedy of any person aggrieved by the sale ,re-allotment or the other disposal of the shares to forfeited shall be in damages only and solely against the Company have been previously surrendered to it by the defaulting member, stand cancelled and shall become null and void and will be of no effect.

68. The provisions as to forfeiture shall apply in the case of non-payment of any sum, which by the terms of issue of share becomes payable by the virtue of call duty made and notified.

MEETING OF THE SHAREHOLDERS

78. The Annual General Meeting shall be held in accordance with the provisions of Section 166 of the Act, and shall be called at a time during business hours, on a day that is not a public holiday, shall be held either at the Registered Office of the Company or some other place within the city town or village in which the Registered Office of the Company is situated as the Board may determine and the Notice calling the meeting shall specify it as the Annual General Meeting.

Extraordinary General Meeting

79. A General Meeting of the Shareholders may be called by the board whenever and wherever they think fit. All meetings of the shareholders other than Annual General Meetings convened by the Company, shall be called Extra Ordinary General Meetings. General Meetings called in pursuance of a requisition of members under the Act, will also be called as Extra Ordinary General Meetings.

Boards to Call Extra Ordinary General Meeting

80. The Directors shall on the requisition of members of the Company representing not less than one tenth of the issued share capital of the Company upon which all calls or other sums then due have been paid forthwith proceed to call an Extra Ordinary General Meeting of the Company and in case of such requisition, the following provisions shall have effect:

(a)Any valid requisition so made by a member or members must state the object or objects of the meeting proposed to be called, and must be signed by the requisitionist and be deposited at the Registered Office of the Company provided that such requisition may consist of several documents, in like forms each signed by one or more requisitionists.

(b)If the board does not proceed to call a meeting within twenty one days from the date of deposit of the requisition, the requisitionists or majority of them in value may themselves convene the meeting but in either case any meeting so called shall be held within three months form the date of the deposit of the requisition as aforesaid.

(c)If at any such meeting, resolution requiring confirmation at another meeting is passed, the Directors shall forthwith call another General Meeting for the purpose of considering the resolution and, if thought fit, of confirming it and if the Directors do not call the meeting within seven days from the date of passing of the first resolution, the requisitionist or a majority of them in value may themselves call the General Meeting.

(d)Any meeting called by the requisitionists shall be called in the same manner as early as possible as that in which meetings are to be called by the board and shall be held at the Registered Office of the Company.

Quorum at General Meeting

81. The quorum for a General Meeting of the Company shall be five members present in person. If within half an hour from the time appointed for the meeting a quorum of members shall not be present, the meeting if convened by or upon the requisition of members shall stand dissolved, but in any other case, it shall stand adjourned to the same day in the next week at the same time and place or to such other day and at such time and place as the board may determine if no such time and place be determined to the same day in the next week, at the same time and place. If at such adjourned meeting a quorum is not present, the members present shall be the quorum for that meeting and they may transact the businesses for which the meeting.

82. Chairman of General Meeting

The Chairman of the board of Directors shall be entitled to take the chair at every general meeting whether ordinary or extra ordinary, or if there be no such chairman or if at any meeting he is not present within 15 minutes of the time appointed for holding such meeting or if he declines to take the chair, the members present shall elect another Director as Chairman and if no such Director be present, or if all the Directors present decline to take the chair, members present shall elect one of their members to be the Chairman of the Meeting.

Business confined to election of chairman whilst the chair is vacant

83. No business shall be discussed at any general meeting except the election of a chairman whilst the chair is vacant

a. If a person other than the previous Chairman is elected as Chairman for the rest of the meeting.

b. Any candidate for the office of Chairman should not preside over the election, and where an outgoing Chairman seeks reelection, he should vacate the chair pending the election, unless on a show of hands he is re-elected without any controversy.

Chairman may adjourn meeting

84. The Chairman with the consent of the meeting may adjourn any meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.

Manner of Taking Votes

85. The resolution shall be decided by votes taken in the manner as prescribed by Sections 177 to 185 of the Act.

Demand for poll not to prevent transactions of other business

86. The demand for a poll shall not prevent the continuance of a meeting for the transaction of any business other than the business on which a poll has been demanded except on questions of the elections of the Chairman and of an adjournment.

Demand for poll

87. A poll may be ordered to be taken by the Chairman of the Meeting of his own motion, and shall be ordered to be taken by him on a demand made in that behalf by the person or persons specified in section 179 of the Act. IT shall be taken in such manner as the Chairman directs, and the results of the poll shall be deemed to be the decision of the meeting on the resolution on which the poll was taken.

Time and Manner of Taking Poll

88. If a poll is demanded as aforesaid, the same shall, subject to Article 87 be taken at such time not later than 48 hours from the time when the demand was made, and at such place, and either by open voting or by ballot, as the chairman shall direct, and either at once or after an interval or after adjournment or otherwise, and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded. The demand for a poll may be withdrawn.

Scrutineers at poll

Where a poll is to be taken, the Chairman of the meeting shall appoint two scrutineers. Of the two scrutineers appointed under this Article, one shall always be a member (not an officer or employee of the Company) present at the meeting provided such member is available and willing to be appointed and to scrutinise the votes given on the poll and to report thereon to him. The Chairman shall have power at any time before the result of the poll is declared to remove a scrutineer from office and fill up the vacancy in the office of scrutineer arising from such removal or from any other cause.

Time for Objection for Validity of Votes

89. No objection shall be made to the validity of any vote except at the meeting or poll at which such vote shall be rendered and every vote not disallowed at such meeting or poll and whether given personally or by proxy shall be deemed valid for all purposes whatsoever. In vase of dispute as to the admission or rejection of vote the Chairman shall determine the same and such determine shall be final and conclusive.

Question of General Meeting How Decided

90. At any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands, unless a poll is ( before or on the declaration of the result of the show of hands) ordered to be taken by the Chairman of the Meeting of his own motion of is demanded by any member or members present in person or by proxy or power of attorney and holding shares in the Company.

(a)Which confer a power to vote on the resolution not being less than one-tenth of the total voting power in respect of the resolution, or against that resolution.

Chairman's Casting Vote

91. In the case of an equality of votes, the Chairman shall, both on a show of hands and at a poll, (if any) have a casting vote in addition to the vote or votes to which he may be entitled as a member.

MANAGING AND WHOLE-TIME DIRECTORS

Power to appoint A managing or whole-time Director

118. Subject to the provisions of the Act, the Directors may from time to time one or more of their body to be a Managing director or Managing Directors and or whole-time Directors of the Company for such term not exceeding five years at a time as they may think fit , to Manage the affairs of the Company. The first Managing director shall be Mr.K. Ashok.

What provisions shall they subject to

119. Subject to the provisions of the Act , and of these Articles , a managing director and or a whole-time director shall not, while he continues to hold that office,be subject to retirement by rotation under Section 255 and 256 of the Act ,but he shall be,subject to the same provisions as to resignation and removal as other directors of the Company and he shall ipso-facto and immediately cease to be a managing director or whole-time director if he cease to hold the office of director.

Remuneration of a managing or whole-time directors

120. The remuneration of a managing director and or whole-time director(subject to section 309 and other applicable provisions of the Act,and of these Articles and of any contract between him and the Company) shall be from time to time be fixed by the directors subject to the approval of the Company in General Meeting and may be by way of fixed salary ,or commission on profits of the Company ,or by participation in any such profits ,or any or all of these modes.

(a)The remuneration of whole time director and or managing director shall be paid monthly remuneration as determined by the board from time to time subject to the provisions of the Act.

Powers and Duties of Managing or Whole-Time Directors

121. Subject to the superintendence ,control and direction of the board of directors, the day to day management of the company shall be in the hands of the directors appointed under article 120,with power to the directors ,if more than one ,to delegate powers in any manner, between themselves as directed by the board ,and upon such terms and conditions , and with or without restrictions as they may think expedient, and subject to the provisions of the Act, with powers to the board to alter ,vary, revoke, or withdraw all or any of such powers.

WINDING UP

Distribution of Assets

159. If the Company shall be wound up, and the surplus assets shall not be sufficient to repay the whole of the paid-up capital, such surplus assets shall be distributed subject to special preferential rights of the Preference or any other shareholder, so that the losses shall be borne by the members as nearly as may be in proportion to the capital paid-up the shares held by them respectively as the commencement of the Winding up. But this clause is to be without prejudice to the rights of the holders of shares issued on special condition.

Distribution of excess of surplus assets

160. If upon the winding of the Company, the surplus assets be more than sufficient to repay the whole of the paid-up capital for the time being, the excess be distributed among the holders of ordinary shares, subject to preferential rights of the Preference or ordinary shareholders in respect of capital or dividend as provided in these Articles, in proportion to the capital paid on these shares held by them respectively as to the commencement of the winding up other than amount paid in advance of calls.

Division of assets and specie

161. The Liquidator on any winding up ( either voluntarily, under supervision or compulsory) may with the sanction of an ordinary resolution, divide among the contributories in specie any part of the assets of the Company and may with the like sanction vest any part of the assets of the Company in trustees upon such terms for the benefit of the contributories as the Liquidator with the like sanction, shall think fit in accordance with the provisions of the Act.

INDEMNITY

Right of Directors and others to indemnity

162. Subject to the provisions of the Act, every Director, Auditor, Manager, Secretary and other Officer shall be indemnified by the Company from all losses and expenses incurred by them respectively in or about the discharge of their respective duties except such as happen from their own respective willful acts and defaults. They shall be indemnified by the Company against any liabilities incurred by them in defending any proceedings, whether civil or criminal in which judgement is given in their favour or in which they are acquitted or in connection with any application under Section 633 of the Act, in which relief is granted to them by the Court.

Secrecy Clause

163. No member shall be entitled without the permission of the Directors, to require discovery of or any information, respecting any detail of the Company's trading or any matter which is, or may be in the nature of a trade secret or mystery of trade or which may relate to the conduct of the business of the Company, and which in the opinion of the Directors will be inexpedient in the interest of the members of the Company to communicate to the public.

MATERIAL CONTRACTS AND INSPECTION OF DOCUMENTS

The following contract and agreement referred to in Para "A" below (not being contracts entered into in the ordinary course of business carried on or intended to be carried on by the Company or contracts entered into more than two years before the date of this prospectus) which are / or may be deemed to be material have been entered into by or on behalf of the Company. Copies of these contracts together with copies of documents referred to in Para "B" below all of which have been attached to the copy of this prospectus and which have been delivered to the Registrar of Companies, Tamilnadu at Chennai for registration and may be inspected at the Registered Office of the Company between 11.00 a.m. and 1.00 p.m. on any working day from the date of this prospectus until the date of closing of subscription list.

A. MATERIAL CONTRACTS

1. Memorandum of Understanding between the Company and the Lead Manager M/s Aryaman Financial Services Ltd. Dated 05.06.2000.

2. Memorandum of Understanding between the Company and the Registrars to the Issue dated 12.06.2000.

3. Appointment letter from Software Galaxy Systems dated 27^th April 2000.

4. Appointment letter from Garimella Systems Search Inc dated 25^th May 2000.

5. Lease Agreement for its Registered office dated 19^th March 2000, corporate office dated 20^th April 2000 and additional office area dated 22^nd June 2000.

6. Franchisee Agreement with Dotcom Software for its franchisee center at T. Nagar, Chennai.

B. DOCUMENTS FOR INSPECTION

1. Memorandum and Articles of Association of the Company

2. Certificate of Incorporation of the Company.

3. Fresh Certificate of incorporation for change in name from Lemuria Technics Pvt Ltd to Lemuria Technologies Pvt. Limited

4. Fresh Certificate of incorporation consequent on change of name from Private to public.

5. Consent letters from Lead Managers to the Issue, Registrars to the issue, Legal Advisor, Bankers to the issue, Bankers to the Company, Directors, Auditor as referred to in this prospectus to act in their respective capacities

6. Copies of the Resolutions passed under Sections 81(1A) dated 01.06.2000

7. Auditors Certificate of tax benefits dated 23/05/2000.

8. Auditors report dated 01/06/2000 included in the prospectus and consent to include the same in Prospectus

9. Copies of Balance Sheets for the year ending 31/03/97, 31/03/98 , 31/03/99 , 31/03/2000 and from 1/04/2000 to 31/05/2000

10. Copies of initial listing application made to the Stock Exchanges Chennai Ahmedabad and Hyderabad .

11. Power of attorney executed by the directors for signing and correction in the prospectus

12. Board resolution regarding authorisation of Registrar to the issue for realisation of stock invest

13. Copy of Due Diligence Certificate given by the Lead Managers M/s Aryaman Financial Services Limited to SEBI.

14. Auditors letter for deployment of funds dated 16^th June 2000.

15. Observation letter of SEBI dated -----------------------

PART - III

DECLARATION

All the relevant provisions of the Companies Act, 1956 and the guidelines issued by the Government have been complied with and no statement made in this prospectus is contrary to the provisions of the Companies Act, 1956 and Rules made there under.

Signed by the Directors:

1. Mr. K.Ashok

2. Mr. K.Kumaraguru

3. Mr.N.Nagarajan *

4. Mr.K.Rajesh *

5. Mrs. A.Hamsa

(*by their constituted attorney Mr.K.Ashok)

Place : Chennai

TABLE OF CONTENTS

Particulars

Page Nos.

Definition/ Abbreviations

Risk Factors and Management perceptions thereof

Highlights

PART – I

1. General Information

2. Issue Management Team

3. Capital Structure of the Company

4. Terms of the Present Issue

5. Particulars of the Issue

6. Company, Management and Project

7. Stock Market Data & Basis for Issue Price.

8. Outstanding Litigation. Disputes and defaults

9. Material Developments & Other matters

10. Risk factors & Management Perception thereof

PART – II

A. General Information

B. Financial Information

C. Statutory and Other Information

D. Main Provisions of the Articles of Association of the Company

E. Material Contracts and Documents for Inspection

PART – III

Declaration

ABBREVIATIONS USED IN THE PROSPECTUS

LTL / the Company / the Issuer

Lemuria Technologies Limited

ACT

The Companies Act, 1956

ARTICLES

Articles of Association of the Company

BOARD

Board of Directors of LTL

ECOM

Electronic Commerce

EPS

Earnings per share

GUI

Graphical user interface

ISP

Internet service provider

ISSUE

Public Issue of 29,40,000 Equity Shares of the Company

NAV

Net Assets Value

OS

Operating System

PAN

Permanent Account Number

RBI

Reserve Bank of India

RDBMS

Relational data base management system

ROC

Registrar of Companies

SEBI

The Securities and Exchange Board of India

USA

The United States of America

COMPLIANCE OFFICER

LEMURIA TECHNOLOGIES LIMITED

TOTAL

Cash

AUTHORITY FOR THE PRESENT ISSUE

TAX BENEFITS

COST OF THE PROJECT AND MEANS OF FINANCE

Over Seas Training Centre And Marketing Office

PRESENT BUSINESS ACTIVITY

The salient features of each web portals are as below :-

A.B.Travels,Chennai

SCHEDULE OF IMPLEMENTATION

FUTURE PROJECTS

A. SOFTWARE SOLUTIONS

B. ENTERPRISE TRAINING

BUSINESS GROWTH STRATEGY

EMPLOYEES RETENTION

QUALITY ASSURANCE STRATEGY

DEVELOPING LONG TERM CLIENT RELATIONSHIP

APPLICATION DEVELOPMENT SERVICES