Joint Deed of Hypothecation of Stocks and Book Debts

AND WHEREAS the Participating Banks have agreed to open cash credit accounts individually with each of them in the name of the Borrower in respect of the said cash credit facility (which accounts are herein after deemed to as "the said cash credit accounts").

NOW IN CONSIDERATION OF THE Participating Banks having agreed to grant accommodation to the Borrower by way of cash credit facility in the manner above referred to and to open the said cash credit accounts in the name of the Borrower, the Borrower hereby agrees with and confirms and declares to the Participating Banks and each of them as follows

1. The Borrower shall pay to the Participating Banks on demand being made by the Participating Banks the balances then outstanding and owing to the Participating Banks under or at the foot of the said cash credit commission, discount, costs (between attornay and client), charges and expenses and all other moneys debited accounts, inclusive of all interest to the date of payment, together with any service charges, commitment charges. or which are debitable to the said cash credit accounts hereunder.

2. 1. That the Borrower shall pay interest to each of the Participating Banks in respect of the said cash accounts opened with each of them from time to time on the outstandings in their respective cash credit accounts at such respective rates as are mentioned in the Schedule hereto, provided that each of the Participating Banks shall at any time and from time to time be entitled to change the rate of interest and notify to the Borrower of such change and this document shall be construed as if such revised rates of interest were always mentioned in the said Schedule and agreed to be paid by the Borrower and hereby secured.

2. 2. Interest payable at the rates aforesaid shall be calculated on the daily balance in the cash credit account(s) and charged in the said cash credit account(s) on the last working day of each month or quarter according as the Participating Banks may individually decide.

2. 3. Without prejudice to the generality of the foregoing the Participating Banks shall also be entitled to charge at their own discretion individually or as may be decided by them collectively and the Borrower shall be liable to pay and hereby agrees to pay such enhanced rate of interest on the said cash credit accounts either on the entire outstanding or the portion thereof as the Participating Banks may individually fix for any irregularity or any breach of the terms hereof by the Borrower and for such period as the irregularity or breach continues or for such time as the Paricipating Banks may individually deem it necessary regard being had to the nature of the irregularity or breach, provided that the charging and payment of such enhanced rate of interest shall be without prejudice to the other rights or remedies of the Participating Banks either hereunder or by law to proceed for such irregularity or breach against the Borrower and/or the security hereby created.

3.1 The Borrower doth hereby hypothecate and charge by way of a first charge to and in favour of the Participating Banks ranking pari passu inter se without any preference or priority to one over the other (s): -

(a) the whole of the Borrower's present and future stocks of raw materials, good-in-process of manufacture and all finished and manufactured goods and articles such as (here give a general description of the raw materials, goods and articles hypothecated) together with all stores, components and spares which now belong to or may hereafter from time to time during the continuance of this security belong to Borrower and which are or shall or may be brought into stored or be in or upon or about the Borrower's the factory, godown and/or other premises at or wherever else the same may be situate, stored or lying or being, including any such raw materials, articles or goods, stores, spares and components or other similar movable property in course of transit or delivery to the Borrower (and all of which hereinafter for brevity's sake referred to as "the said goods") and

(b) all of the Borrower's present and future book debts outstanding monies, receivables, claims, belonging to the Borrower or which may at any time hereafter during the continuance of this security become bills, rights to or immovable properties and movable assets and which are now due, owing or payable or due, owing, payable or belonging to the Borrower in the course of its business (and all of which are hereinafter or brevity's sake referred to as "the said debts and assets").

3. 2 The said goods and the said debts and assets which are hereby hypothecated by the Borrower and in favour of the Participating Banks by way of a first charge shall be and remain as scary to the Participating Banks for the due payment by the Borrower to the Participating Banks on demand

(a) of all monies at any time payable by the Borrower to them under or in respect of the said cash credit facility and whether for principal, interest, service charges, commitment charge, commission discount, or for costs charges and expenses or other monies payable hereunder by the Borrower to the Participating Banks and/or which may be incurred by them and

(b) for the due payment and discharge of all indebtedness and/or liability of the Borrower to the Participating Banks including in respect of any bills of exchange, promissory notes or instruments at any time drawn, made, accepted or endorsed by the Borrower solely or jointly with others which the Participating Banks and/or each one or more of them may discount or become interested in, together with all interest, discount, commission, charges (including service charges), costs (between attorney/advocate and client) and expenses payable to or incurred by the Participating Banks,

4. That the Participating Banks shall have the absolute right and discretion to decide whether or not to advance or allow to remain outstanding any monies even against the security of the said goods and the said debts and assets hypothecated hereunder by the Borrower. Further, the Participating Banks shall be at liberty at any time at their sole discretion or as may be decided by them without previous notice to the Borrower and without assigning any reason whatsoever to cease to make any further advances in the said cash credit accounts or at all and to recall at any time the moneys then due by the Borrower to the Participating Banks in the said cash credit accounts.

5. 1. That the Participating Banks shall not be required to make or continue advances in the said cash credit account(s) otherwise than at the discretion of the Participating Banks.

5. 2. That the Borrower shall at all times during the continuance of this security keep and maintain such margin of security in favour of the Participating Banks (hereinafter called 'the said margins) as mentioned below, viz:

or such other percentages as the Participating Banks may from time to time determine of the cost or market value (market value as found by the Participating Banks) whichever is lower of the said goods and the said debts and assets or any part thereof.

5. 3. That the Participating Banks shall be entitled to and shall be at liberty to change from time to time the margins and the Borrower shall be bound by such change.

6. That the Borrower will at all times maintain a sufficient quantity of the said goods and/or the said debts and assets to provide the necessary margin on security as specified herein and as may be required by the Participating Banks from time to time and will forthwith whenever necessary provide further goods and debts and assets approved by the Participating Banks to restore such margins or reduce the amount for the time being due to the Participating Banks by cash payment so as to maintain the said margins.

7. 1. That the Borrower shall whenever so required by any of the Participating Banks furnish to such Participating Banks full particulars of all the assets of the Borrower and of the said goods and the said debts and assets and shall allow such Participating Banks or their authorised agents to take inspection thereof and of all records books and vouchers pertaining thereto and will produce such evidence as such Participating Banks may require as to the cost and value of any of the said goods and the said debts and assets.

7. 2. That the Borrower shall value the said goods and/or the said debts and assets at the appropriate rates whether fixed by the Participating Banks or not and shall not overvalue the same. In any case, the Participating Banks shall be at liberty from time to time and at any time to have any of the said goods and/or the said debts and assets inspected and valued by an appraiser or valuer appointed by the Participating Banks which value shall be conclusive and binding on the Borrower both in and out of court.

7. 3. That the fees, costs, charges and expenses of such inspection, appraisal or valuation (the Participating Bank's statement in regard thereto being conclusive) shall be borne and paid by the Borrower to Participating Banks on demand and may, if not so paid, be debited to any of the said cash credit accounts of the Borrower and shall form part of the moneys hereby secured.

8. 1. That the said goods and the said debts and assets shall be kept at the Borrower's risk and expenses and the Borrower shall at their own expense during the continuance of this security keep the said goods in good and marketable condition and in proper working order and shall likewise at its own expense insure and keep insured the said goods against loss or damage by fire, riot, civil commotion and all such other risks as any of the Participating Banks shall require for the full market/replacement value thereof in an insurance office or offices to be approved by the Participating Banks and shall deliver the policies of insurance to the Participating Banks and shall likewise deliver the receipt for the last premium paid for every such policy of insurance and shall assign to the Participating Banks jointly every such policy of insurance and shall pay to the Participating Banks all proceeds of any policy received by the Borrower during the continuance of this security and shall renew, keep in force and maintain such insurance throughout the continuance of this security and deliver to the Participating Banks the renewal receipts and policies. In default, the participating Banks may (but shall not be bound to) keep in good condition and render marketable and in good working order the said goods effect or renew such insurance. Any premium paid by the Participating Banks and any costs, charges and expenses incurred by the Participating Banks or any of them shall be repaid by the Borrower on demand forthwith and shall until repayment with interest at the rate aforesaid be a charge on the said goods and the said debts and assets hereby hypothecated. The Paticipating Banks shall be entitled without prejudice to all their other rights and powers to debit the amounts of such premium, costs, charges and expenses to the cash credit accounts of the Borrower in such manner as they deem fit. All sums received under such insurance shall be applied in or towards liquidation of the amount for the time being due to the Participating Banks or any of them as provided herein.

8. 2. That the Participating Banks shall be entitled to adjust, settle and compromise in any manner whatsoever, including by reference to arbitration at the Borrower's cost any dispute arising under or in connection with any such policy of insurance and such adjustment, settlement, compromise and any award made or decision given in any such arbitration or otherwise shall be valid and binding on the Borrower and the Participating Banks shall also be entitled to receive all monies payable under any such insurance or under any claim made thereunder and to issue a valid receipt therefor and that the amounts so received shall be credited to any of the said cash credit accounts and that the Borrower will not raise any question that a larger sum might or ought to have been received or be entitled to raise any dispute on the balance in any of the said cash credit accounts after such credit. Provided that the Participating Banks may at their own absolute discretion waive any of the requirements as to insurance, to such extent and in such manner as they may deem fit.

8. 3. That the borrower shall pay all rents, taxes payments and outgoings in respect of any immovable property in or on which the said goods or any part thereof may for the time being be lying and shall keep such property insured against loss or damage by fire and shall also insure the same against such other risks as the Participating Banks or any of them shall require and shall produce the policies of insurance to the Participating Banks or any of them whenever required by them or any of them.

9. 1. That the Borrower shall make best endeavours to obtain payment of all the said debts and assets as and when the same shall become payable and pay all such sums when received into the said cash credit accounts with the Participating Banks. Further, the Borrower shall not, except in the ordinary course of business, receive, release or compound any of the said debts and assets without the consent in writing of the Participating Banks and will not do anything whereby the recovery thereof may be delayed, impeded prejudiced, prevented or become time barred.

9. 2. That the borrower shall keep proper books of accounts of its business and carefully keep and reserve all the documents, papers and vouchers in connection with or relating to or which prove or are likely to prove the said debts and assets or any part thereto and will at any time when required produce such books, documents, papers and vouchers for the inspection of the Participating Banks, or any of them and their respective officers and agents and allow them or it or him access thereto and to make copies of or extracts from the same.

10. 1. That it shall be lawful for the Participating Banks or any of them or their agents, nominees, officers or employees forthwith or at any time during the continuance of this advance and without any notice to the Borrower to enter into or upon the place or premises where or wherein any of the said goods and/or the said debts and assets and books of accounts, papers, documents and vouchers and other records relating to the said goods or the said debts and assets may be or situated or kept or stored (and for the purpose of such entry, if necessary, to do so as attorney of the Borrower and in the name of the Borrower and to do all acts, deeds and things deemed necessary by the Participating Banks or any of them) and to inspect value, insure, superintend disposal and/or make particulars of all or any part of the said goods and said debts and assets and check any statements, accounts, reports and information and also, if the Borrower shall fail to repay on demand any monies, which ought to be paid by the Borrower hereunder or shall commit any breach of any agreement on its part herein contained or under any circumstances which in the sole judgement of the Participating Banks or any of them is prejudicial to or imperil or is likely to prejudice or imperil the security created hereunder or if any distress of exeution is levied or enforced against any property or assets whatsoever of the Borrower or if a person shall take any steps towards applying for or obtaining an order for the appointment of the receiver of any property or assets whatsoever of the Borrower or if such receiver is appointed or if any person shall apply or obtain an order for the winding up of the Borrower or if any such order is made or if any step is taken by any person towards passing any resolution to wind up the Borrower or if any such resolution shall be passed or if the Borrower shall suspend or cease to carry on business or to conduct its business to the satisfaction of the Participating Banks or any of them then and in any such case, it shall be lawful for the Paticipating Banks to take charge, seize, recover, receive appoint receivers or remove and take possession of all or any part of the said goods and the said debts and assets and also of all books of accounts, papers, documents and vouchers and other records relating thereto and thereupon either forthwith or at any time and from time to time to sell, realise, dispose of and deal with in any manner including by public auction or tender or private contract and whether with or without intervention of the court all or any part of the said goods and the said debts and assets in such manner and upon such terms and conditions as the Participating Banks or any of them think fit.

10. 2. That the Participating Banks shall, without prejudice to the foregoing powers, be also entitled at the Borrower's risk and expenses and if necessary either as attorney for and on behalf and in the name of the Borrower or otherswise as the Participating Banks may deem fit (the Borrower hereby appointing the Participating Banks jointly and each severally to be its attorneys and attorney) to take possession and/or to appoint receivers of all or any of the said debts and assets and to give notices and demands to debtors and third parties liable therefor and to demand, such for, recover, receive, realise and give effectual receipts and discharges for the same and sell or realise either by public auction or private contract and to transfer endorse, assign, deliver or otherwise dispose of or deal with all or any of the said debts and asset and to enforce realise settle and compromise in any manner whatsoever including by reference to arbitration and/or deal in any manner with all or any of the said debts and assets and to complete any engagement relating thereto.

10. 3. That the Participating Banks shall without prejudice to the foregoing powers be also entitled generally to enforce, realise, settle, compromise and deal with any of the rights aforesaid as regards the said goods and the said debts and assets, but without being bound to exercise any of these rights or powers or being liable for any loss in the exercise thereof and any such exercise shall be without prejudice to the rights and remedies of the Participating Banks of suit or otherwise and notwithstanding that there may be pending suit or other proceedings.

10. 4. That the Borrower hereby undertakes to give immediate possession to the Participating Banks on demand of the said goods and the said debts and assets and to give notice to the debtors as and when required by the Participating Banks and to transfer endorse, produce and deliver to the Participating Banks all relative contracts, securities, notes, bills of exchange and other negotiable instruments and also all books of accounts, documents, papers, files and vouchers relating to the said goods and the said debts and assets and agrees to accept the accounts of sales and realisations given by the Participating Banks as conclusive proof of amounts realised and relative expenses and to pay on demand any shortfall or deficiencies thereby shown. The proceeds of sale or other realisation of the said goods and the said debts and assets shall be applied by the Participating Banks in the manner mentioned in clause 12 hereof.

10. 5. That the Participating Banks shall be entitled at all times and without any notice to the Borrower to set-off and apply any other money or moneys in the hands of the Participating Banks standing to the credit of or belonging to the Borrower in or towards payments of any amount at any time being payable to the Participating Banks or towards the outstandings in the said cash credit accounts or as otherwise aforesaid and to recover at any time from the Borrower by suit or otherwise the balance remaining payable to the Participating Banks under the said cash credit account(s) or otherwise notwithstanding that all or any of the securities may be outstanding and/or may not have been realised.

10. 6. Provided also that subject to all these powers of the Participating Banks, the Borrower may sell the said goods and deal with the said debts and assets from time to time in due course of business provided the margin on security required by the Participating Banks is fully maintained and on condition of payment or delivery to the Participating Banks of the net proceeds thereof or documents therefor immediately on receipt thereof. Provided further that the Borrower shall not make any sale of any of the said goods or any realisation of the said debts and assets upon being prohibited in writing by any of the Participating Banks from doing so.

11. In case some of the Participating Banks do not consider it necessary or desirable for any reasons either to exercise any authority or power hereby exercisable by the Participating Banks and/or to take action in pursuance of the foregoing clause 10 or in the event of their failing for any reason to exercise such power or authority or to take any action in pursuance of that clause, any one or more of the remaining Participating Banks shall so far as regards the Borrower shall be at liberty to exercise any power or authority exercisable hereunder by the Participating Banks and to file any suits or legal proceedings for recovery of their dues from the Borrower and to take steps to realise or enforce the security hereby created in favour of the participating Banks, either by sale or otherwise, and either through the intervention of the court or by appointing a receiver or in any other manner howsoever and whatsoever as any of them thinks fit, and may close the said cash credit accounts with them.

12. That in the event of the said goods and the sad debts and assets being realised howsoever and in whatsoever manner the proceeds of sale of the said goods and of realisation of the said debts and assets and all the monies received from insurance companies or otherwise in respect of the said goods and the said debts and assets remaining after deducting therefrom the costs (between attorneys/advocates and clients) charges and expenses incidental to such sale or other realisation shall in the first instance be appropriated towards satisfaction of all indebtedness of the Borrower due and outstanding to the Participating Banks, such indebtedness being the amount outstanding under the said cash credit accounts, and the interest due thereon upto the date of realisation of the security whether actually debited or not to the said cash credit accounts together with any cost (between attorneys/advocates and client) charges and expenses debitable to the said cash credit accounts whether actually debited or not, pro-rata in accordance with the total amount of such indebtedness due and oustanding under and in respect of the said cash credit accounts as aforesaid with each of the Participating Banks and thereafter the balance, if any, shall be available for, and be appropriated to the remaining outstanding indebtedness of the with the total amount of such other outstanding indebtedness. Borrower, on any account to the Participating Banks and/or any one or more of them, pro-rata in accordance And in the event of the net proceeds of realisation remaining as aforesaid being insufficient for repayament of whole of the respective indebtedness of the Borrower to the Participating Banks under or in respect of the said cash credit accounts, as aforesaid, the same shall be appropriated in liquidation of the said indebtedness of the Borrower to the Participating Banks as aforesaid prorata in accordance with the total amount of such indebtedness.

13. That all the said goods and the said debts and assets and all proceeds of sale or other realisations and proceeds of insurance thereof and all documents under this security shall always be kept distinguishable and held as the exclusive property of the Participating Banks specifically appropriated to the security to be dealt with only under the directions of the Participating Banks and the Borrower shall not without the permission of each one of the Participating Banks create any mortgage charge lien or encumbrance upon or over or affecting the same or any part thereof (and whether ranking prior to or pari-passu with or subject to security) except jointly to the participating Banks and also upon or over or affecting the Borrower's undertaking property (whether movable or immovable) and assets (including uncalled capital) not charged to the Participating Banks hereunder or any part thereof except with the permission of the Participating Banks and to the extent they may permit, nor suffer any such mortgage, charge lien or encumbrance to affect the same or any part thereof nor do or allow anything that may prejudice this security.

14. 1. That the Borrower will submit to the Participating Banks monthly or as often as may be required, stock statements of the said goods and also statements of the said debts and assets together with list of current insurance policies and amounts insured verified by certificates of the Borrower or the Manager for the time being of the Borrower that the quantities and amounts stated in the statements are correct and that all the said goods are fully covered by insurance and containing such other certificates and particulars as may be specified by the Participating Banks and will also furnish and verify all financial and other statements reports returns certificates accounts documents particulars and information and such other periodical data as may be required by the Participating Banks.

14. 2. That the Borrower will also execute all documents, transfers, assignments and endorsements and do all acts deeds and things which the Participating Banks may require for vesting the said debts and assets or any of them in the Participating Banks and to render the same readily realisable or transferrable by the Participating Banks, at any time and also for giving full effect to this security.

14. 3. That the Borrower hereby irrevocably appoints the Participating Banks jointly and each of them severally (through their agents and nominees) to be attorneys and attorney of and for and in the name of the Borrower to do all such acts, deeds and things and execute all such documents, transfers, assignments, endorsements, whatever which the Borrower may be required by the Participating Banks to do or execute under or in respect of this Agreement in the event of the Borrower failing to do so within a week from the date of demand by the Participating Banks for such purpose.

15. That this Agreement shall operate as and this security shall be a continuing security for the balance from time to time due to the Participating Banks on the said cash credit accounts and for all monies, indebtedness and liabilities hereby secured and none of the said cash credit accounts is to be considered to be closed for the purpose of this security and the security is not to be considered exhausted by reason of the said accounts or any of them being brought to credit or to nil balance at any time or from time to time or of its being drawn upon to the full extent if afterwards reopened by a payment to credit.

16. Subject to the provisions of clause 13 hereof that any general or special lien to which the Participating Banks are or may be by law or otherwise entitled to or any rights or remedies of the Participating Banks in respect of any present or future indebtedness or liabilities or guarantee obligations of the Borrower to the Participating Banks shall continue to be in force and effect subject to and only subject to the pari passu rights of the Participating Banks under this Agreement and it shall be open to the Participating Banks to enforce or have recourse to such rights or remedies or securities without being bound to enforce any security rights or remedies under this Agreement.

17. That all the said goods and the said debts and assets presently hypothecated are the absolute property of the Borrower at the sole disposal of the Borrower and free from any prior charge or encumbrance and that all the future goods and debts and assets that will be hypothecated shall be likewise the unencumbered and absolute and disposable property of the Borrower.

18. That the security herein created over the said goods and the said debts and assets shall rank pari passu and without any preference or priority in all respects and for all intents and purposes inter so the Participating Banks so that the said security shall rank as pari passu first charge and be enforceable as such.

19. 1. That the Borrower will regulate its drawings out of and payments into each of the said cash credit accounts with the Participating Banks in such manner that the amounts due from time to time for principal and interest on each of the said cash credit accounts shall be kept as nearly as practicable pro rata to the respective limits granted by the Participating Banks.

19. 2. No payment into or drawings out of any of the said cash credit accounts or any transactions dealing agreement or arrangement whatsoever in connection with any of the said cash credit accounts shall affect the state of the other cash credit accounts or any transaction dealing agreement or arrangement in connection therewith.

20. That the Borrower shall carry on the entire banking transactions of its business through the Participating Banks only wherever any one of them is having their office. Such banking business of the Borrower shall as far as practicable be placed with each of the Participating Banks in the same ratio as the respective limits.

21. That the Borrower shall at the beginning of each quarter in the calendar year advise to the Lead Bank the aggregate amount that the Borrower proposes to draw from the various Participating Banks during that quarter and on being advised by the Lead Bank the pro rata commitment of each one of the Participating Banks, the Borrower shall pay to the Participating Banks any commitment charge that may be agreed upon from time to time between the Borrowers and the Participating Banks. In default of such payment, the Participating Banks may without prejudice to their other rights hereunder debit the amount of such commitment charge to the cash credit accounts of the Borrower and the same shall thereupon form part of the moneys hereby secured.

22. That the Participating Banks shall not in any way be responsible in respect of the quantity, quality weight, amount, value condition and final out turn of the said goods and/or the said debts and assets if the same are or happen to be in possession of the Participating Banks, and for any loss, destruction deterioraion thereof or damage thereto occasioned by theft, pilferage, robbery, fire, riot, and civil commotion, malicious damage or otherwise however whatever may be the circumstances or the reasons under or for which the loss, destruction, deterioration or damage may arise, including any act, omission. negligence, default of the Participating Banks or any of their servants or nominees or agents.

23. That the Borrower has and shall continue to have the necessary powers to enter into this arrangement and do all things incidental thereto and the Participating Banks shall not be bound to enquire into the powers of the Borrower and this security shall not be affecetd by reason of any absence of or deficiency or excess or irregularity in the exercise of any powers of the Borrowers.

24. That the officers or agents or nominees acting or purporting to act on behalf of the Borrower in this respect and executing these documents have and shall continue to have the necessary powers from the Borrower and further that the Participating Banks shall not be bound to enquire into the powers of any officer of agent acting on purporting to act on behalf of the Borrower and this security shall not be affected by reason of any absence of or deficiency or excess or irregularity in the exercise of any powers of any such officers or agents aforesaid.

25. Any demand or notice to be made or given on or to any party hereto may be made or given by leaving the same at or posting to same by Registered post in an envelope addressed to such party at its Registered Office or Head office or Local Head Office as the case may be and every such demand or notice shall be deemed to be received as the case may be at the time at which it is left or at the time at which it would have been delivered in the ordinary course of post at the Registered/Head/Local Head Office in question.

26. That the Borrower shall pay on demand to the Participating Banks the costs between attorney/advocate and client incurred by them or any of them in connection with the preparation engrossment stamping and execution of this Agreement in original and duplicates and of any guarantee or other security executed contemporaneously herewith in connection with the advance hereby secured and of the registration of this security with the Registrar of Companies and all other costs (between attorney/advocate and client), incurred or to be incurred by the Partcipating Banks in any of them in connection herewith or with the enforcement or realisation or attempted enforcement or realisation of the security hereby created or the protection or defence or perfection thereof or for the recovery of any monies hereby secured and of all suits and proceedings of whatsoever nature for the enforcement or realisation of the security hereby created or the recovery of such monies or otherwise in connection herewith or in which any of the Participating Banks may be joined as a party or otherwise involved by reason of the existence of the security hereby created.

THE SCHEDULE ABOVE REFERRED TO