Indigo Airlines has tightened the non-compete terms for Ronojoy Dutta who is stepping down from his position as chief executive from September 30. Dutta had announced in the middle of May that he had decided to seek early retirement, about 17 months before his tenure was due to expire on January 23, 2024.

Shareholders of InterGlobe Aviation — the parent of the country’s largest airline — will start e-voting on Wednesday on a special resolution to pay his remuneration for the period April 1 to September 30, including full and final settlement and ex-gratia amount. The voting will continue till 5pm on September 29. The payout is being made on the “assumed inadequacy of profits in FY 2022-23 for the purpose of computation of the managerial remuneration”, says the notice to the shareholders that forms part of a regulatory filing to the stock exchanges on Tuesday.

The accelerated payment of bonus and stock assumptions comes with a rider: Dutta has accepted an enhanced non-compete period of two years against the one year that had been worked into his original contract. But that’s not all: Dutta cannot be associated with any entity in the domestic aviation sector or provide consultancy to “any airline or potential airline within 4,800 km of India”.

This unusually broad sweep rules out any airline operating from the Gulf on one side and as far away as Hong Kong on the other. Istanbul in Turkey is just outside that range. The outgoing chief executive officer had agreed to serve a notice period of 4.5 months against the stipulated six months, foregoing 1.5 months of his notice pay.

As a result, Dutta will receive a fixed pay of $ 393,000 for the six-month period from April 1 to September 30. He will also receive an accelerated bonus of $1.27 million which will be paid by the end of December. He will also receive payment in lieu of the 64,750 stock options vesting on January 29 next year. The payout for his options will be calculated on the basis of the stock price on the last day of employment less the exercise price of Rs 765 per share.

IndiGo suffered a loss of Rs 6,171 crore in the year ended March 31. It also reported a loss of Rs 1,065 crore in the first quarter of this fiscal. The notice said the company had assumed inadequacy of profits in FY 2022-23 for the purpose of computation of the managerial remuneration “on account of the accumulated losses over the previous financial years”.