To, M/s Prithvi Information Solutions Ltd.

, 2-56/2/19, Prithvi House, Khanamet Village, HITEC City, Madhapur, Hyderabad 500 081 Phone: 91-11-23327790 Fax: 91-11-23327790

Email: kishore.vadde@prithvisolutions.com

rajiv.srivastava@prithvisolutions.com

Sub: - Response to your letter dated 25 July-2013.

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References: 1. Bid Identification No: MD/WZ/06/PUR/ADB/ERP-03, opened on 18 Dec-2012. 2. Notification of Contract Award vide no. MD/WZ/06/PUR/ADB/ERP-03/3596, Indore Date: 15-Feb-2013 3. Project Plan submitted by you on dated 25 Apr-2013. 4. Agreement signed on dated 25 Apr-2013. 5. Letter of this office dated 16 May-2013 regarding non-compliance of contractual obligation by you. 6. Email of this office dated 18 May-2013. 7. Email of this office dated 20 May-2013 at 12:30 PM. 8. Email of yours dated 20 May-2013 at 01:02 PM. 9. Email of this office dated 20 May-2013 at 05:28 PM. 10. Email of yours dated 20 May-2013 at 06:16 PM. 11. Email of this office dated 21 May-2013 at 02:53 PM. 12. Email of yours dated 21 May-2013 at 04:56 PM. 13. This office letter No. MD/WZ/06/PUR/ADB/ERP-03/11417, Indore, Date: 22-May-2013. 14. Letter of yours wide no. Prithivi /MPPKVVCL-ERP DC/2012-2013/12-13/493052713 dated May 27, 2013. 15. Email of yours dated 31 May-2013 to schedule kickoff meeting.
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16. Email of this office dated 18 June-2013 regarding non-compliance from M/s Prithvi Information solution. 17. Email from this office dated 21 June-2013 regarding absence of M/s Prithvi officials in the kickoff meeting. 18. Email of yours dated 22 June-2013 regarding confirmation of kickoff meeting. 19. Email of yours dated 25 June-2013 regarding kickoff presentation. 20. Email of yours dated 8 July-2013 regarding approval of M/s Amitech as subcontractor. 21. Email of this office dated 9 July- 2013 regarding process of subcontractor approval. 22. This office letter No. MD/WZ/06/PUR/ADB/ERP-03/ 15340, Indore, Date- 17 Jul-2013. 23. Email of this office dated 22
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July-2013 at 12:38 PM, regarding MOM dated 22th Jul-2013.

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24. Your letter no 493072213 dtd 22 mentioned in the MoM.

July, 2013, regarding reply against the action items

25. This office letter No. MD/WZ/06/PUR/ADB/ERP-03/ 15979, Indore, Date- 24 Jul-2013. 26. Your letter no. Prithvi/MPPKVVCL-ERP DC/2012-2013/12-13/493072313 dated 24 July2013. 27. This office reply vide email dated 24 July-2013 at 7:07 PM. 28. Your letter no. Prithvi/MPPKVVCL-ERP DC/2012-2013/12-13/493072513 dated 25 July2013.
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Dear Sirs,

This has reference to your letter no 493072513 dtd 25 July,2013, regarding various assurances made for completion of our Project for Supply, Installation, and Support of Servers, Network Equipment, Data Center Infrastructure and related Software.

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Our observations, comments and requirements in reference to aforesaid communication are as under1. Regarding Financial Capability:

Regarding your query as to why the Discom is again requesting for documents in support of Financial Capability of Prithvi for successful completion of project, the reasons are as undera. M/s Prithvi had taken more than two months time to submit the PBG from the date of

Award, whereas the same was required to be submitted within 28 days of the date of award. b. The contract was awarded to M/s Prithvi on dtd 15.2.2013. The share price of M/s Prithvi

was Rs 13.50 per share on that date. The same has come down to Rs 6.00 as on 22.7.2013, which indicates market perception regarding financial problems of M/s Prithvi. c. Even after passing of more than 5 months from the date of award, M/s Prithvi has not

been able to show a single order which has been placed by them to any OEM/ sub-vendor/ contractor for execution of the project. d. M/s Prithvi has not deployed a single resource person at Indore site for execution of the

project, whereas M/s Prithvi was required to depute 6 persons having qualifications and experience as mentioned in clause 2.1.10 of the contract. e. During discussions on dtd 22.7.2012, Mr Rajiv Shrivastava from M/s Prithvi himself had

cited funding problems as reason for delay in execution of project and had claimed that now funding problems have been solved. As such, in support of his claim, he was requested to provide the supporting documents, which he had agreed to provide during the meeting but declined during subsequent communications.

It is true that the documents regarding financial capability of M/s Prithvi were examined PRIOR TO award of contract, but the financial position CHANGES with time. Reasons cited above create a genuine apprehension in our mind regarding CURRENT financial capability of M/s Prithvi for execution of the project. In any case, obtaining a letter of comfort from its own bankers may not be a difficult task for M/s Prithvi, if it has adequate financial resources to execute the project, as has been represented in its communication dtd 25.7.2013.

The Disom has patiently waited and relied on various communications from Prithvi regarding execution of the Project. However, since the work has still not commenced at site, we now need to be re-assured regarding financial capability of M/s Prithvi for execution of the project.

2.

Regarding Supply of Servers:

We have carefully gone through your submission regarding Supply of Servers vide communication dtd 25.7.2013, which appears to be ignorant at best and mischievous at worst. The Table produced by you in your communication is NOT MENTIONED anywhere in the Bid Documents, Technical Offer of M/s Prithvi or LoA dtd 15.2.2013 from Discom.

The count of servers, has to be derived from a collective reading of Table-4 which shows Make and Model of Servers, Table -7 which shows, Units for counting the quantities (which has been mentioned as Set, in case of Line Items A1 and A2), and finally Table 8, which shows Quantities (in the units described in Table 7, which is Set for line item A1 and A2). Therefore, please go carefully through your own bid offer, technical solutions documents submitted by you, as well as LoA in totality, so as to ascertain the number of servers to be supplied.

Please be informed that in your Technical Solution, you have proposed to provide only Stand Alone Servers to meet the required Specint for each set of servers as prescribed in Section VI - Schedule of Supply of the bid Documents (because you have not proposed any Virtualization Software in your Technical Solution). The Discom shall ascertain, interalia, compliance with the Specint Requirements, for each set of servers proposed to be supplied for execution of the project.

Further to above, we refer to your submission regarding SQL Server licenses, wherein it has been assured that there shall be no requirement of these licenses for data base of EMS/ NMS. This proposal would be acceptable, if M/s Prithvi can provide an un-equivocal confirmation that Licenses for neither SQL Servers, nor any other alternate software would be required for Data-Base requirement of EMS/ NMS, from the OEM of the EMS/ NMS software; and in case requirement for licenses of any software comes up in this regard, the same shall be procured and provided by M/s Prithvi without any additional cost, what-so-ever, to Discom.

3.

Bottlenecks expressed by M/s Prithvi regarding DC & DR Sites:a. Regarding non acceptance of amendment of your PBG by East Discom:

In this regard, as already suggested by our previous communication dtd 24 July-2013, you are again advised to contact the relevant persons at East Discom, Jabalpur. b. Regarding non approval of Lay-out of DC/ DR sites :

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The developments so far in this regard are as under(i) As per the agreed project plan, the schedule timelines for submission of DC
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& DR Civil Design was on or before 15 May-2013, but M/s Prithvi has not deployed Data Center Design Expert till date at site, as per the resource requirement mentioned in the subject contract. (ii) Mr. Guneet from M/s Prithvi has come on 5 Jun-2013 with proposed
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drawings. MPPKVVCL, Indore has provided the observations on the same day. Mr. Guneet has submitted the revised drawing of DC vide e-mail dated 12 Jun-2013 and further revised it and informed vide email dated 13 Jun-2013, but the drawing of revised design was missing in the attachment of said e-mail. (iii) Due to the frequent revision of Design proposed by M/s Prithvi and non
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availability of Data Center Design Expert and other resources at Indore, MPPKVVCL, Indore was not in position to finalize the design without any discussions/queries with respective resources. MPPKVVCL, Indore has already informed regarding non-availability of resources at site vide e-mail dated 28 May, 30 May and 12 Jun-2013. Therefore, the reasons for delay on above account are of Prithvis own making, and can not at all be attributed to Discom.
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c.

Regarding refund of EMD :

Please refer to this office e-mail dtd 18th June, 2013, wherein the position regarding refund of EMD has already been clarified. . 4. Regarding Delivery of Cisco Materials:
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MPPKVVCL, Indore, vide e-mail dated 24 July-2013 had informed you that Discom officials will visit Hyderabad in first week of August,subject to resolution of all matters as informed you in letter No. MD/WZ/06/PUR/ADB/ERP-03/ 15979 Indore, Date- 24 Jul-2013. However, there is no progress seen in this regard up till now.

Therefore, subject to resolution of issues as informed vide our previous communication dtd 24.7.2013, and completion of other formalities relating to PDI, inspection as mentioned in clause 2.1.9.1 would be conducted, at a mutually convenient date.

5.

Regarding Sub-Contracting :

As already suggested vide our communication dtd 24 Jul, 2013, you are again requested to make proper application for consideration and approval of sub-contractors who shall be working on the project on your behalf, giving necessary details.

6.

Regarding payment milestones :

Please go through the contract document carefully wherein the payment milestones have been clearly mentioned. Payment shall be released as per contract terms and conditions only.

7.

Regarding other issues raised vide this office letter no 24 July, 2013 : (i) M/s Prithvi was requested to take following actions by 26 July, 2013 vide this
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office letter dtd 24 July,2013. a.

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Provide documents/ confirmations as mentioned para 1 to 6 of letter dtd

24 July,2013. b. Submission of Revised Project Execution Plan, so as to meet the agreed project

Time Lines. c. Nomination of authorized representative who shall be responsible for entire

delivery of entire project and with whom official communications may be exchanged, along with his complete contact details. (ii) In addition, M/s Prithvi was advised to visit Discom offices on or before 29 July,
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2013, along-with proposed sub-contractors, for detailed discussion regarding modalities of execution of Project.

However, it is a cause of serious concern that none of the required documents/ confirmations have been submitted so far and proposed date for meeting too has not been informed.

Delays in execution of works by M/s Prithvi are likely to result into substantial financial costs as well as operational difficulties for Discom. Therefore, the Discom can not passively wait and just hope that the project would be delivered on-time by M/s Prithvi. In view of this, one final opportunity is given to M/s Prithvi for submission of the documents/ confirmations mentioned as per (i) above by 29 July, and visit Discom offices on any day before 31st July, 2013 along-with proposed sub-contractors, for detailed discussion regarding modalities of execution of Project as per (ii) above .
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It may please be noted that unless the actions as mentioned above are taken-up by you within the timelines as indicated, the Discom shall be constrained to take actions for termination of the contract, at the risk and costs of M/s Prithvi, under clause 5.9 (i) of the contract documents. S.E. & Project Manager (ERP) M O/o MD-WZ, Indore.

On Thu, Jul 25, 2013 at 6:48 PM, Dev Vasudevan <dev.vasudevan@prithvisolutions.com> wrote: Dear Sir, Please find attached our reply for your kind perusal. Best Regards, Dev. DV | Manager (Pre-sales) Prithvi Information Solutions Limited | Hyderabad Desk: +91-40-44856019 - EXT: 182 | Fax: +91-40-44856021 | Mobile: +91-9492061730 / +91-7382251730 Email: dev.vasudevan@prithvisolutions.com | Website: http://www.prithvisolutions.com/ From: MPPKVVCL ERP [mailto:mppkvvcl.erp@gmail.com] Sent: Wednesday, July 24, 2013 4:51 PM To: Dev Vasudevan Cc: Satish V; Ambika Prasad M; Rajiv Srivastava; Kishore Vadde; Pankaj Jha; mppkvvcl.westpm@prithvisolutions.com Subject: Re: Final Notice prior to Termination of Contract awarded vide no. MD/WZ/ 06/PUR/ADB/ERP03/3596, Indore Date: 15-Feb-2013, due to persistent failure in delivery of Goods/Services in accordance with project plan submitted by M/s Prithvi Information Soluti

PFA.........

On Mon, Jul 22, 2013 at 6:53 PM, Dev Vasudevan <dev.vasudevan@prithvisolutions.com> wrote:
Dear Sir, Please find attached our reply against the action items mentioned in the MoM document for your kind perusal. Best Regards, Dev. DV | Manager (Pre-sales) Prithvi Information Solutions Limited | Hyderabad Desk: +91-40-44856019 - EXT: 182 | Fax: +91-40-44856021 | Mobile: +91-9492061730 / +91-7382251730 Email: dev.vasudevan@prithvisolutions.com | Website: http://www.prithvisolutions.com/ From: MPPKVVCL ERP [mailto:mppkvvcl.erp@gmail.com] Sent: Monday, July 22, 2013 2:53 PM To: satish@prithvisolutions.com; Kishore Vadde; Pankaj Jha; Dev Vasudevan; Ambika Prasad M; Rajiv Srivastava; mppkvvcl.westpm@prithvisolutions.com Subject: Re: Final Notice prior to Termination of Contract awarded vide no. MD/WZ/ 06/PUR/ADB/ERP03/3596, Indore Date: 15-Feb-2013, due to persistent failure in delivery of Goods/Services in accordance with project plan submitted by M/s Prithvi Information Soluti

Dear Rajiv, Please find attached MOM of meeting dated 22nd July-2013. We are waiting for your response. On Thu, Jul 18, 2013 at 12:38 PM, MPPKVVCL ERP <mppkvvcl.erp@gmail.com> wrote: Dear Sir, Please find attached Final Notice prior to Termination of Contract awarded vide no. MD/WZ/06/PUR/ADB/ERP-03/3596, Indore Date: 15-Feb-2013, due to persistent failure in delivery of Goods/Services in accordance with project plan submitted by M/s Prithvi Information Solutions Ltd. -regards, Dinesh Gangrade, C.I.O. & Project Director (ADB), O/o MD(WZ) MPPKVVCL, Indore

-regards, Gautam Kochar, D.G.M-IT (ERP), O/o CMD, MPPKVVCL, Indore, Mob. No.- +91-9425346450

-regards, Gautam Kochar, D.G.M-IT (ERP), O/o CMD, MPPKVVCL, Indore, Mob. No.- +91-9425346450