CL-2025-000062 - [2025] EWHC 1506 (Comm)

On 21 August, Oyster Bay, which ultimately subscribed for much of the first tranche of the Bonds, entered into a Subscription Agreement with Eraaya. It summarised the provisions as to the collateral secured by way of pledge. It also provided that:

“The Issuer shall use the proceeds of the offering of the Bonds (“Proceeds”) towards the acquisition of 100% equity of EBIX Inc and other eligible purposes, subject to receipt of all applicable approvals and consents.

…Use of Proceeds: In the event that the Issuer intends to use the Proceeds for use other than what is stated in the Terms and Conditions, it will require prior written consent of the Bondholder.”

On 23 August 2024, Eraaya issued US$60 million of bonds (“the First Bond Issue”).

On the same day, Mr Joseph Mammen of Elara, having received notification from GLAS that funds had landed in their account, sent a “Securities Distribution Notice”. This was a document in a form prescribed by the Offering Circular, and signed by Eraaya’s directors, identifying exactly where to send the money, the relevant ISIN codes and the counterparty emails. In this case it was to be sent to an Elara account (US$40m) and two others (US$11m and US$9M).

On 29 August 2024, GLAS paid the net proceeds (equivalent to approximately US$59,459,700, allowing for the deduction by GLAS of “Issue Fees & Expenses”) accordingly.

On 30 August 2024, the sale of Ebix completed and Ebix exited from Chapter 11 bankruptcy. Eraaya did not acquire 100% of Ebix, but only 97.58%, with the remainder being acquired by Melanie Lane and Watch Hill.