Parent HoldCo Constitution

Preamble

This Constitution establishes the foundational principles governing MetaCompany Private Limited ("HoldCo" or "Parent") and its relationship with its subsidiary companies ("Subsidiaries" or "Operating Companies").

We believe that exceptional businesses are built by owner-operators who have skin in the game, operational freedom, and long-term alignment with capital providers. This Constitution enshrines a decentralized model where the Parent provides capital, governance infrastructure, and strategic support while Operating Companies retain full autonomy over their operations.

The Parent exists to serve the Operating Companies, not to control them.

Part I: Foundational Principles

Article 1: Purpose of the Parent

1.1 The Parent exists to:

• Acquire and hold strategic stakes in software and technology businesses
• Provide permanent capital to Operating Companies
• Enable consolidation for eventual public listing
• Create a platform for owner-operators to build wealth through equity participation
• Maintain minimal but effective governance standards across the group

1.2 The Parent shall NOT:

• Interfere in day-to-day operations of Operating Companies
• Impose unnecessary reporting burdens
• Extract value through management fees or excessive charges
• Override operational decisions of owner-operators
• Compromise long-term value for short-term gains

Article 2: The Federal-State Model

2.1 Division of Powers

This Constitution establishes a clear division between matters reserved to the Parent ("Federal Matters") and matters delegated to Operating Companies ("State Matters").

2.2 Principle of Subsidiarity

Decisions shall be made at the lowest competent level. If an Operating Company can effectively make a decision, that decision belongs to the Operating Company, not the Parent.

2.3 Enumerated Powers

The Parent possesses only those powers explicitly enumerated in this Constitution. All residual powers vest in the Operating Companies.

Article 2.5: Step-Down Subsidiaries

Operating Companies may establish or acquire their own subsidiaries ("Step-Down Subsidiaries") subject to the following framework:

2.5.1 Depth Limit

The maximum permitted subsidiary depth from Parent is two levels:

• Level 1: Operating Companies (direct subsidiaries of Parent)
• Level 2: Step-Down Subsidiaries (subsidiaries of Operating Companies)

No Step-Down Subsidiary may itself create or acquire a subsidiary (Level 3) without express written approval from the Parent Board. Such approval shall only be granted for compelling structural reasons (regulatory requirement, international expansion, ring-fencing of specific risk).

2.5.2 Prior Approval Required

Creation or acquisition of any Step-Down Subsidiary requires Parent approval under Article 6 (Reserved Matters). The Operating Company shall submit:

• Business rationale for the Step-Down structure
• Proposed ownership percentage
• Governance model selection (Delegated or Direct)
• Confirmation that Step-Down is in a Permitted Sector
• Pro-forma impact on consolidated financials

2.5.3 Governance Models

At the time of approval, Parent shall designate one of two governance models:

2.5.4 Consolidation & Reporting

Regardless of governance model:

• All Step-Down Subsidiaries shall follow group accounting policies
• All Step-Down Subsidiaries shall provide information required for consolidation
• Operating Company shall ensure Step-Down compliance with reporting timelines

2.5.5 Profit Flow

Minimum dividend policies apply at each level:

• Step-Down Subsidiaries shall distribute to Operating Company per applicable policy
• Operating Company's distributable profits include its share of Step-Down dividends
• This ensures profits flow up the chain to Parent

2.5.6 Unwinding

Parent may require unwinding (merger into Operating Company, sale, or liquidation) of a Step-Down Subsidiary if:

• Step-Down is loss-making for 3 consecutive years
• Step-Down structure no longer serves valid business purpose
• Required for IPO simplification
• Operating Company consents (not to be unreasonably withheld)

Article 3: Core Values

All entities within the group shall adhere to these non-negotiable values:

Part II: Governance Structure of the Parent

Article 4: Board of Directors

4.1 Composition

The Board of the Parent shall comprise:

• Founder/Promoter Directors: Minimum 2
• Independent Directors: Minimum 1 (increasing as required by law for listed companies)
• Nominee Directors (if external investors): As per investment agreements

4.2 Role of the Board

The Parent Board shall:

• Set group-wide strategic direction
• Approve acquisition of new Operating Companies
• Monitor consolidated financial performance
• Ensure compliance with this Constitution
• Approve amendments to this Constitution
• Approve group-wide policies on reserved matters

4.3 Board Meetings

• Minimum 4 meetings per year (quarterly)
• Quorum: Majority of directors including at least one Founder Director
• Decisions by simple majority; Constitution amendments require 75% approval

Article 5: Management Structure

5.1 Group CEO

The Group CEO (initially the Founder) shall:

• Oversee relationships with Operating Company owner-operators
• Represent the group to external stakeholders
• Coordinate group-wide initiatives (if any)
• NOT interfere in subsidiary operations unless Constitution is breached

5.2 Group CFO

The Group CFO shall:

• Consolidate financial statements
• Ensure uniform accounting policies
• Coordinate with subsidiary finance teams
• Manage group treasury (if centralized)
• Prepare for IPO readiness

5.3 Lean Headquarters

The Parent shall maintain minimal staff. Functions that can be performed by Operating Companies shall not be duplicated at the Parent level.

Part III: Federal Matters (Parent's Reserved Powers)

Article 6: Enumerated Reserved Matters

The following matters require Parent approval regardless of Operating Company autonomy:

6.1 Constitutional Matters

• Amendment to Memorandum or Articles of Association of any group entity
• Change in the capital structure or share classes
• Admission of new shareholders to any Operating Company
• Any action that would cause Parent to lose subsidiary status

6.2 Existential & Structural Matters

• Sale, merger, or winding up of any Operating Company
• Sale of substantially all assets (defined as >30% of gross assets)
• Filing for insolvency or bankruptcy
• Change in the core business activity
• Creation or acquisition of any Step-Down Subsidiary (per Article 2.5)
• Any action that would create a Level 3 or deeper subsidiary structure

6.3 Financial Matters

• Borrowing exceeding ₹1 Crore or 50% of net worth, whichever is lower
• Creating security over assets exceeding ₹50 Lakhs
• Providing guarantees or indemnities to third parties
• Related party transactions exceeding ₹25 Lakhs per annum with any single party
• Capital expenditure exceeding ₹1 Crore in a single transaction

6.4 Governance Matters

• Appointment or removal of statutory auditors
• Appointment or removal of the Chief Financial Officer
• Change in accounting policies or financial year
• Initiation or settlement of litigation exceeding ₹50 Lakhs

6.5 Equity Matters

• Issue of any shares, options, warrants, or convertible instruments
• Buyback of shares
• Declaration of dividends (though minimum payout is mandated)
• Any fundraise at Operating Company level

Article 7: Process for Reserved Matter Approval

7.1 Operating Company shall submit written request with:

• Description of proposed action
• Rationale and business case
• Financial impact assessment
• Risk analysis

7.2 Parent shall respond within 15 business days

7.3 Approval shall not be unreasonably withheld if action is:

• In ordinary course of business
• Consistent with approved business plan
• Not detrimental to group interests

7.4 Deemed approval if no response within 30 business days (except for matters under 6.1 and 6.2)

Part IV: State Matters (Operating Company Autonomy)

Article 8: Delegated Powers

Operating Companies have EXCLUSIVE authority over:

Article 9: Non-Interference Commitment

9.1 The Parent commits to not interfering in State Matters except:

• Where Operating Company requests guidance
• Where action violates this Constitution
• Where action poses material risk to the group
• Where financial performance triggers intervention rights (Article 17)

9.2 Parent representatives shall not:

• Attend Operating Company internal meetings uninvited
• Directly contact Operating Company employees on operational matters
• Make commitments to Operating Company customers or vendors
• Override owner-operator decisions on State Matters

Part V: Financial Framework

Article 10: Profit Remittance

10.1 Minimum Dividend Policy

Each profitable Operating Company shall distribute as dividend:

• Minimum 30% of Profit After Tax, OR
• Such amount as ensures Parent receives at least the specified minimum per annum
• Whichever is higher

10.2 Timing

• Interim dividend: Within 60 days of half-year end
• Final dividend: Within 90 days of financial year end

10.3 Retention for Growth

Operating Company may retain profits beyond minimum dividend for:

• Approved capital expenditure
• Working capital for demonstrated growth
• Strategic reserves (up to 6 months operating expenses)

Retention beyond these purposes requires Parent approval.

Article 11: Financial Reporting

11.1 Monthly Reporting — Within 15 days of month end:

• Revenue and collections
• Operating expenses
• Cash position
• Key operational metrics (as defined per subsidiary)

11.2 Quarterly Reporting — Within 30 days of quarter end:

• Full financial statements (P&L, Balance Sheet, Cash Flow)
• Variance analysis against budget
• Updated annual forecast
• Compliance certificate

11.3 Annual Reporting — Within 60 days of year end:

• Audited financial statements
• Director's report
• Tax filings
• Compliance confirmations

Article 12: Accounting Standards

12.1 All Operating Companies shall follow Ind AS as applicable

12.2 Uniform accounting policies across the group for:

• Revenue recognition
• Depreciation methods and rates
• Inventory valuation
• Provisioning norms

12.3 Group CFO shall issue accounting policy manual; deviations require approval

Article 13: Audit

13.1 Statutory auditor appointed by Parent from among reputed firms

13.2 Same auditor for all group entities (or affiliated firms) to enable consolidation

13.3 Internal audit function at group level with access to all Operating Companies

13.4 Audit committee of Parent Board to oversee all audits

Part VI: Owner-Operator Framework

Article 14: Who is an Owner-Operator

14.1 An Owner-Operator is the individual (or small team) who:

• Holds minority equity in an Operating Company
• Serves as Managing Director/CEO of that Operating Company
• Is responsible for all operational decisions
• Participates in equity upside through the Performance Equity Program

14.2 Owner-Operators are NOT employees of the Parent

14.3 Owner-Operators are entrepreneurs backed by the Parent, not managers hired by the Parent

Article 15: Owner-Operator Rights

15.1 Operational Freedom

• Complete autonomy over State Matters
• Right to build team and culture as they see fit
• Right to set strategy within approved business scope

15.2 Economic Rights

• Base compensation as approved in Operating Company budget
• Participation in Performance Equity Program (Part VII)
• Share in dividends proportionate to equity held
• No dilution without consent (anti-dilution protection)

15.3 Information Rights

• Access to all Parent communications affecting their Operating Company
• Quarterly update on consolidated group performance
• Notice of any proposed changes to this Constitution

15.4 Exit Rights

• Put option to sell equity back to Parent (see Article 20)
• Tag-along rights if Parent sells its stake
• Right to participate in IPO

Article 16: Owner-Operator Obligations

16.1 Performance

• Achieve profitability within agreed timeline (typically Year 2)
• Meet minimum profit remittance requirements
• Deliver accurate and timely financial reports

16.2 Compliance

• Adhere to this Constitution
• Comply with all applicable laws
• Maintain ethical standards

16.3 Non-Compete

• During tenure: No competing business
• Post-exit: 2-year non-compete within same industry and geography

16.4 Confidentiality

• Protect group confidential information
• Not disclose terms of this Constitution or shareholding arrangements

16.5 Full-Time Commitment

• Operating Company must be primary professional commitment
• No other employment or material business activity without disclosure

Article 17: Underperformance Protocol

17.1 Trigger Events

The following constitute underperformance:

• Two consecutive years of operating losses (after initial ramp-up period)
• Cash position falling below 3 months of operating expenses
• Material fraud or compliance violation
• Persistent breach of reporting obligations

17.2 Escalation Process

17.3 Recovery

If Operating Company returns to profitability for 2 consecutive quarters, Stage level decreases by one. Full autonomy restored after 4 consecutive profitable quarters.

Part VII: Exit Mechanisms

Article 18: Owner-Operator Exit

18.1 Voluntary Exit (Good Leaver)

After 3-year lock-in:

• Put option to sell equity to Parent
• Price: Higher of (a) Fair Market Value or (b) Book Value
• Payment within 12 months

18.2 Involuntary Exit (Bad Leaver)

Termination for cause (fraud, material breach):

• Equity bought back at Book Value only
• Non-compete strictly enforced

18.3 Death or Disability

Legal heirs may sell to Parent at FMV or continue as passive shareholders

Article 19: Parent Exit

19.1 Sale of Parent

If Parent is acquired:

• Owner-operators have tag-along rights at same valuation
• Or may continue under new ownership with Constitution preserved

19.2 Sale of Operating Company Stake

Parent shall not sell its stake in an Operating Company without:

• First offering to owner-operator at same price (Right of First Refusal)
• Owner-operator consent to incoming shareholder

19.3 IPO

• Owner-operators shall have right to participate in IPO (subject to lock-in)
• Constitution principles to be embedded in listed company governance

Part VIII: Dispute Resolution

Article 20: Resolution Process

20.1 Good Faith Discussion

Parties shall first attempt to resolve disputes through direct discussion between Group CEO and Owner-Operator.

20.2 Mediation

If unresolved within 30 days, dispute referred to mutually acceptable mediator. Mediation to conclude within 60 days.

20.3 Arbitration

If mediation fails:

• Arbitration under Arbitration and Conciliation Act, 1996
• Seat: Hyderabad
• Single arbitrator mutually appointed; failing agreement, appointed by institution
• Decision final and binding

20.4 Costs

Each party bears own costs unless arbitrator determines otherwise for frivolous claims.

Article 21: Governing Law

This Constitution governed by laws of India. Courts of Hyderabad shall have jurisdiction for matters not subject to arbitration.

Part IX: Amendment

Article 22: Amendment Process

22.1 This Constitution may be amended by:

• 75% approval of Parent Board, AND
• Consent of Owner-Operators holding majority of aggregate Operating Company equity

22.2 Amendments affecting economic rights of specific owner-operator require that owner-operator's consent

22.3 Foundational Principles (Part I) may only be amended by unanimous consent

Article 23: Interpretation Principles

23.1 In case of ambiguity, interpret in favor of Operating Company autonomy

23.2 This Constitution prevails over individual Shareholders' Agreements to the extent of inconsistency

23.3 Schedules and Annexures form part of this Constitution

Schedules

Schedule A: List of Operating Companies

To be updated as subsidiaries are added

Schedule B: Financial Thresholds

May be updated annually by Parent Board

Schedule C: Reporting Templates

To be attached

Schedule D: Accounting Policy Manual

To be attached