Hero MotoCorp on August 14 disclosed details of the promoter family settlement pact entered by the family members on July 27, 2016.
As per the pact, Sunil Munjal exited from the management and control of Hero MotoCorp and also stepped down from the post of joint managing director.
According to the agreement, management and control of the listed entity remained vested with the family group comprising of Pawan Munjal, Santosh Munjal, Renu Munjal and Suman Kant Munjal.
In an exchange filing following the disclosure of the pact, Hero MotoCorp clarified that the agreement "pertains to the year 2016" and there has been "no change in the management or control of the company in any manner at present".
"Sunil Munjal stepped down as Jt. MD in the year 2016 itself which was part of the regulatory disclosure at that time as well," it added.
Hero MotoCorp has, in the recent period, been under the scanner of investigation agencies. The Enforcement Directorate raided the residence of its company chairman Pawan Munjal last month. The Income Tax department had conducted raids on the company premises last year.
The settlement pact
The parties to the promoter family agreement were Santosh Munjal, who was the promoter during execution of agreement; Renu Munjal and Suman Kant Munjal, who are promoters; Pawan Munjal, the company's promoter and chairman; and Sunil Munjal, who was then part of the promoter group.
The purpose of the agreement was the division of BML Munjal Group Entities, including the listed entity between the parties to the agreement.
The terms of the pact, as agreed upon by the parties involved in July 2016, stated that "Sunil Kant Munjal, hereinafter refer to as an 'individual' shall exit from the management and control of Hero MotoCorp Limited, including any position held as Joint Managing Director".
"Understanding reached between 'Family Group' and Sunil Kant Munjal on usage of trademark 'HERO'," it further stated.
A spokesperson of Hero MotoCorp said that the settlement pact was disclosed with the stock exchanges as part of a "routine exercise", which is applicable to all listed companies.
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