Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 484

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part II, Item 1
Chunk 484
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Since November 2023, we are
in violation of our scheduled monthly instalment payment obligations of $215,337 per month on our lease liability with Ayvens Group (f/k/a
Leaseplan India Private Limited) (“Leaseplan”). Leaseplan notified us on February 7, 2024, that we are in default of
our November 2023 payment. As of the date hereof, we are in default beyond the 30-day extended cure period (as envisaged under the terms
of our debt with Leaseplan) of our November 2023 payment and continue to be default of all EMIs thereafter. As a result of such defaults,
as of the date hereof, Leaseplan (i) has initiated the process of repossession of all vehicles, and (ii) has invoked the bank guarantee
of $120,482 which was a security created by Zoomcar in favor of Leaseplan. Such outcomes may have a material adverse impact on our business,
operations, or financial condition. 

Based on the most recent
discussions with Leaseplan, the Company continues to negotiate a payment plan to the restructured debt proposal shared by the Company
wherein the debt after certain waivers and discounts, will stand restructured to $4,755,942 and the Company is hopeful that Leaseplan
will issue a comfort letter in this regard acknowledging the proposed payment schedule spread across six tranches for repayment of the
restructured debt. As of January 31, 2024, the Company has already cleared the first three tranches in accordance with the proposed payment
schedule as per the comfort letter, amounting to $ 2,851,924 (approx.) towards the outstanding debt. Given the continuing negotiations
and the expected comfort letter, we do not contemplate any immediate legal action against the Company in this regard. If we are unable
to execute a settlement agreement for the restructured debt or fail to honor the obligations under any agreement for the subject matter,
it may, possibly result in inter alia (a) the entire outstanding debt becoming due and payable and (b) the withdrawal of a conditional
waiver of $1.2 million which was given during a prior restructuring and will become immediately due and payable with interest of 1.5%
per month.

The Company is in breach of the payment obligation
of $408,351 pursuant to the terms of the settlement deed with Orix Leasing and Financial Services Limited (“Orix”).
Orix has issued a