CBD - 22

BANK OF INDIA
AGREEMENT OF TERM LOAN AND HYPOTHECATION OF MOVABLE
ASSETS/GOODS/PROPERTY/PLANT & MACHINERY

This Agreement made at ___________________ on the ____ day of

_____________20_between
______________________________________________________________and
_________________________________________________________________ carrying on
business as sole proprietor / in partnership under the firm name and style of
Messers
_________________________________________________________________
Co. Ltd., a public / private Company incorporated under the Companies Act,
19_____ and having its registered office at
_________________________________________________________________
(hereinafter referred to as the "Borrower" which expression shall where the
Borrower is a single individual, include his heirs, executors and
administrators and where the Borrower is more than one individual include the
survivors or survivor of them and the respective heirs, executors, and
administrators of a deceased joint borrower and where the Borrower is a
limited Company include its successors and Assigns) of the One Part and Bank
of India a body corporate constituted under the Banking Companies(Acquisition
and Transfer of Undertakings) Act, 1970 having its Head Office at "Plot No C5,
G Block, Bandra Kurla Complex, Bandra East, Mumbai – 400 051”,and a branch
office at
_____________________________________________________________________________
_____ (hereinafter referred to as “the Bank" which expression shall include
its successors and assigns) of the Other Part.

WHEREAS the Borrower has applied to the Bank for a loan of

Rs._________________ for the express purpose and upon the basis set out in the
Borrower's Loan Application, dated _________.

AND WHEREAS the Bank has at the request of the Borrower agreed to
disburse a loan to the extent of Rs._______________ on or after execution of
this Agreement either in one lump sum or in such amounts as may be mutually
agreed upon by the parties to be utilised by the Borrower for purchase of
the movable Assets /Goods/ Property/Plant and Machinery which are to
be hypothecated to the Bank in the Manner hereinafter appearing and short
particulars whereof are given in Schedule "A" hereunder
written and for no other purpose.

NOW IN CONSIDERATION OF THE PREMISES IT IS HEREBY AGREED by and between

the parties as follows:

1. The Borrower is aware that his / its proposal constitutes the basis of
this Agreement and of the said loan of Rs._________ advanced / to be
advanced by the Bank hereunder ( hereinafter referred to as "the said loan
") and the Borrower hereby warrants the correctness of each and every one
of the representations, statements and particulars therein contained and
undertakes to

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carry out the proposal therein set forth in the manner and within the time
therein mentioned. The Borrower shall not make any changes or modifications in
the said proposal without the prior written consent of the bank.

2. The Borrower hereby agrees that the said loan shall be governed by and
subject to the terms contained herein.

3. The Borrower expressly agrees and undertakes that the said loan shall
be utilised exclusively for the purpose and in the manner set forth in the
Borrower's proposal and for no other purpose.

4. The Borrower agrees and undertake to notify the Bank in writing of

any circumstances affecting the correctness of any of the particulars set
forth in the Borrower's proposal or which may affect the Borrower's ability
to carry out the said proposal within seven days after the occurrence of
any such circumstance.

5. The Borrower expressly agrees with the Bank that the Bank shall be
entitled to refuse to grant the said loan or any part thereof, which may
remain to be advanced in the event of:

a) any of the representations, assurances, statements and particulars

contained in the proposal being found in the Bank's opinion ( which shall be
conclusive and binding on the Borrower ) to be incorrect, or

b) the Borrower failing to utilise the said loan or any part thereof for
the purpose and in the manner mentioned in the proposal, or

c) the Borrower failing to implement the proposal in accordance with the

terms and conditions therein mentioned, to the satisfaction of the Bank, or

d) the Borrower failing to comply with any of the terms and conditions
either of the letter of the Bank No. _________________ dated ______________
conveying the Bank's sanction to the grant of the said loan or of this
Agreement or of any security documents executed / to be executed by the
Borrower, or

e) happening or occurrence of any of the matters events or circumstances

mentioned in clause 14 hereof.

On the question whether any of the event, matters or circumstances

mentioned in Sub-clause (a) to (e) above have or has occurred; the opinion of
the Bank shall be final, conclusive, and binding on the Borrower both in and
out of court.

6(a) The Borrower shall repay to the Bank at __________________ the said
loan of Rs. _________________ by the instalments, on the respective dates
and in the manner mentioned in Schedule "B" hereto, Provided that if the
amount of loan actually disbursed is less than Rs. _________________ then the
amount of instalments payable as aforesaid shall be reduced pro-rata but the
same shall be payable on the stipulated days mentioned in Schedule "B" or
the period of repayment shall be correspondingly reduced as the Bank may
decide in its discretion and notify the Borrower in writing. In any such
event, the amount of instalments and the dates of repayment notified by the
Bank to the Borrower shall be deemed to be substituted herein in place and

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instead of the amount of instalments and dates of payment hereinabove
mentioned and this Agreement shall be read and construed accordingly.

6(b) The Borrower shall so long as the said loan or any part thereof remains
unpaid, pay to the Bank interest thereon or on the balance thereof due from
time to time at the rate of ____ % per annum over MCLR/Bank Rate subject to
a minimum of _________ % per annum or at such other rate or rates as may
be notified by the bank to the Borrower from time to time ( including in
particular interest at an additional rate in the event of default by the
Borrower in punctual payment of interest and / or of any instalment
of principal or any part thereof) with quarterly / half yearly rests on
30th day of March, June, September and December in each year and so that
on default in payment of interest or of any instalment of principal or
any part thereof as stipulated above interest shall be charged and payable
on the footing of compound interest at the rates and in the manner
mentioned above. And all such interest (including compound and additional
interest) shall be calculated and charged in accordance with the
usual practice of the Bank and shall be hereby secured.

7(a) The Borrower both hereby hypothecated and charge by way of first
charge to and in favour of the bank all movable Assets / Goods / Property
/ Plant and Machinery together with all accessories, stores and spares
relating thereto, now belonging or hereafter to belong to the Borrower ( both
present and future ) and whether installed or not and whether lying loose or
in cases or which may at any time hereafter during the continuance of this
security be installed or lying whether loose or in cases, or being in
or upon or about the Borrower's factory building or other premises and
godowns at _________________ or wherever else the same may be or held by any
party anywhere to the order and disposition of the borrower or in course
of transit to the Borrower ( all of which are hereafter for sake of
brevity collectively referred to as " the hypothecated goods"). Short
particulars of the hypothecated goods are for purpose of identification
given in Schedule "A" hereunder written.

7(b) The Hypothecated goods are hypothecated and charged as aforesaid as

security for due repayment by the borrower to the Bank at _______________ of
the said loan of Rs. ________________ by the instalments on the days and
in the manner aforesaid together with all interest due and payable thereon
( including compound interest and additional interest payable hereunder ) and
also for all costs, charges and expenses ( the legal costs being between
Advocate and client ) incurred by the Bank to the protection,
preservation, defence and perfection of this security and for attempted or
actual realisation thereof and for any commission that the Bank may pay to
any Corporation or Company or authority in respect of any guarantee the said
Corporation or Company or authority may have given or may give to the Bank
in respect of the said loan and for recovery of all moneys due hereunder
by the borrower to the Bank and hereby secured or expressed so to be.

8(a) The Borrower shall not during the continuance of this Agreement sell,
dispose of, pledge, hypothecate or otherwise charge, encumber, or in any
manner part with the possession of the Borrower do or permit to be done any
act whereby the security hereinbefore expressly given to the Bank shall in
any way be prejudicially affected or whereby any distress or attachment or
execution may be levied thereon by any creditor or other person including any
government or municipal authority or body.

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8(b) The borrower hereby declares and assures that the plant and machinery
constituting / being a part of the hypothecated goods are movable and
constitute movable property.

9. As long as any money remains due in respect of the said loan, the
Borrower shall not remove or cause or permit to be removed the hypothecated
goods from the Borrower’s said premises at
_____________________________________________________when the same are
presently kept or installed or to which (with the consent of the Bank) the
same may be hereafter removed except in the manner and to the extent allowed
by the Bank or except for effecting necessary repairs thereto. The Bank shall
be entitled to put up and the Borrower hereby gives his consent to the Bank to
put up the Bank’s, name board on the hypothecated goods or at the place where
the hypothecated goods are or may be stored, at such time and in such manner
as the Bank may deem proper.

10. The Borrower will at all times pay all rent, rates, taxes, assessments,
dues, and outgoings payable in respect of hypothecated goods and also in
respect of any premises wherein the same may for the time being be installed
or kept or be and will also keep the hypothecated goods in a marketable state
and in good and substantial repair and condition and in thorough working order
and will not make any alterations therein without the previous written consent
of the Bank.

11. The Borrower undertakes to indemnify the Bank against every and any
kind of loss or damage by reason of damage to or destruction or loss of
the hypothecated goods from any cause whatsoever or by reason of any claims by
third parties.

12. The Borrower shall notify the bank at once of any change in his present
address given below and also the address to which the
hypothecated goods may be moved subject nevertheless to the provisions of
clause 9 above.

13. The Borrower hereby irrevocably empowers the Bank and any person or
persons from time to time authorised by the Bank in that behalf and without
previous notice to the Borrower to enter the said premises or any other
premises whatsoever for the purpose of inspection or valuation or for taking
possession of the hypothecated goods pursuant to clause 15 herein contained or
for any other purpose mentioned in the said clause and to remain on the said
premises so long as the Bank may think necessary.

14. Notwithstanding anything to the contrary herein contained, the whole of

the said loan or the entire balance thereof outstanding at the time shall at
the Bank’s option become forthwith due and payable by the Borrower to the Bank
and the Bank will at its option be entitled to enforce its security upon the
happening of any of the following events namely:

a) any instalment of the principal amount of the said loan being unpaid upon
the respective due date for payment thereof;

b) any interest remaining unpaid and in arrears for a space of three months
after the same shall have become due whether demanded or not.

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c) any representation or statement of the Borrower’s proposal being found
incorrect or the Borrower's committing any breach or default in the
performance or observance of any term or condition or provision contained in
these presents and / or Borrower’s proposal or any other term or condition
relating to the loan;

d) the Borrower entering into any arrangement or composition with his

creditors or committing any act of insolvency, or any act the consequence
of which may lead to the insolvency or winding up of the Borrower.

e) execution or distress or other process being enforced or levied upon or

against the whole or any part of the Borrower’s property whether secured
to the bank or not.

f) any order being made or a Resolution being passed for the winding up of the
Borrower ( except for the purpose of amalgamation or reconstruction
with the prior approval of the Bank);

g) a Receiver being appointed in respect of the whole or any part of the

property of the Borrower.

h) the Borrower if (an individual) or any of the partners of the Borrower

(if a firm) being adjudicated insolvent or taking advantage of any law
for the relief of insolvent debtors;

i) the Borrower ceasing or threatening to cease to carry on business or

giving or threatening to give notice of intention to do so;

j) it being certified by an accountant or a firm of accountants appointed by

the Bank (which the Bank is entitled and authorised to do at any time)
that the liabilities of the Borrower exceed his assets or that the
Borrower is carrying on business at a loss;

k) If the Borrower shall without the consent in writing of the Bank attempt
or purport to create any mortgage, charge, pledge hypothecation of lien
or encumbrance ranking in priority to or pari-passu with or to create any
mortgage, charge, pledge, hypothecation or lien or encumbrance subsequent
to, the security given or to be given to the bank for the said loan.

l) if the Borrower shall stop payment or threaten to do so;

m) the occurrence of any event or circumstance, which is prejudicial to or

impairs or imperils or depreciates or jeopardizes, or is likely to
prejudice, impair, imperil, depreciate or jeopardize any security given
to the bank; and

n) the occurrence of any event or circumstance which would or is likely to

prejudicially or adversely affect in any manner the capacity of the
Borrower either to repay the said loan or to carry out the said proposal.

On the question whether any of the acts, matters, events or

circumstances mentioned in the sub clauses (a) to (n) above have or has
happened, the opinion of the Bank shall be final and conclusive and be binding
on the Borrower both in and out of Court.

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15. If the Borrower makes any default in payment of any instalments of
principal or interest on the said loan or any part of such instalment on the
respective due dates of payment thereof as mentioned above or if any event or
circumstance shall occur which shall in the opinion of the Bank be prejudicial
to or endanger or be likely to endanger this security or if any other act,
event, matter or circumstance mentioned in clause 14 above happens or occurs,
the Bank if it thinks fit shall be entitled at the risk and expense of the
Borrower without any notice at any times or time after such default or event
or circumstance occurs or happens to enter (and for that purpose to do any
necessary act, deed or thing) and remain upon any place where the
hypothecated goods or the books of account of the Borrower may be and to
inspect value, insure and take charge or possession and/or to seize, recover,
receive, appoint receivers of all or any part of the hypothecated goods or
books of account and thereupon forthwith or at any time and from time to time
but after giving not less than seven days notice at least to sell either by
public auction or private contract or otherwise dispose of or deal with the
hypothecated goods in such manner and upon such terms and conditions as the
bank shall think fit and to apply the net sale proceeds towards repayment of
the ultimate balance due in the said Loan Account and interest due thereon up
to the date of such application. And to enforce, realise, settle compromise,
and deal with any rights aforesaid without being bound to exercise any of
these and without prejudice to the Bank's right and remedies of suit or
otherwise and notwithstanding there may be any pending suit or other
proceeding. The Borrower hereby also agrees to accept the Bank's accounts of
sales and realisation and to pay any shortfall or deficiency thereby shown.
And if the net sum realised by such sale shall be insufficient to pay the
total amount secured hereunder the Bank shall be at liberty to apply any other
money or moneys in the hands of the Bank standing to the credit of or
belonging to the Borrower in or towards the payment of the balance and in the
event of there being still a deficiency the borrower shall forthwith pay such
deficiency. Provided that nothing herein contained shall in any manner
prejudice or affect the Bank’s remedy against the Borrower personally.

16. The Borrower hereby declares and guarantees that the hypothecated goods
are and shall remain the absolute and unencumbered property of the Borrower
with full power of disposition there over.

17. The Borrower shall furnish and verify all statements and information
from time to time as required by the Bank and give and execute any necessary
documents required to give effect to this security.

18. The Borrower shall, whenever required by the Bank, give full particulars
to the Bank of all the assets of the Borrower and of the hypothecated goods
and shall at all times allow the Bank or the authorised Agent of the Bank
inspection of hypothecated goods and of all records and books of accounts and
vouchers of the Borrower in reference thereto and shall allow the Bank or its
agents to value the same. All costs, charges and expenses incurred by the bank
and incidental to such inspection and valuation shall be paid to the Bank,
forthwith on demand (the bank’s statement being conclusive) and until payment
shall with interest at the rate aforesaid be a charge upon the hypothecated
goods. Any such valuation shall be conclusive and binding on the Borrower both
in and out of Court.

19. The Borrower shall at all times during the continuance of this security
keep and maintain such margin of security in favour of the Bank (hereinafter
called "the said margin") as may be required by the Bank from time to time. If

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and so often as the said margin shall fail to be maintained, and then the
Borrower shall forthwith (according as the Bank may require) either
hypothecate to the Bank further goods or tangible movable property approved by
the bank and of sufficient value to make up the deficiency or shall reduce the
amount for the time being due to the Bank by a cash payment so as to maintain
the said margin.

20(a) The Borrower shall at his own expense insure and keep insured the
hypothecated goods and also the premises wherein the same are installed or
lying loose against fire and other risks and maintain such insurance
throughout the continuance of the security and deliver to the Bank the
renewal receipts therefor and the Bank shall from time to time require for the
full market value thereof and the borrower shall deliver to the Bank the
policies of insurance duly assigned to the Bank.

20(b) In default of the Borrower doing so, the Bank may (but shall not be
bound to) keep in good and proper repair, working order and condition and
render marketable the hypothecated goods or effect or renew such insurance and
pay all rates, taxes, assessments dues and outgoings payable by the Borrower.
Any premium paid by the Bank or any other amount paid by the Bank hereunder
and any costs, charges and expenses whatsoever incurred by the Bank shall be
repaid by the Borrower on demand forthwith. And until repayment with interest
at the rate aforesaid, the same shall be a charge on the hypothecated goods.
All sums received under such insurance shall be applied in or towards
liquidation of the amount for the time being due hereunder to the Bank.

21. The Borrower agrees to accept as conclusive proof of the correctness of

any sum claimed to be due from him to the Bank under this agreement a
statement of account made out from the books of the Bank and signed by Manager
/ Accountant and / or other duly authorised officer of the Bank without the
production of any other voucher, document or paper.

22. The bank shall not in any way be liable or responsible for any damage or
depreciation which the hypothecated goods or any part thereof may suffer or
sustain on any account whatsoever while the same shall at any time into
possession of the Bank or of any receiver appointed by the Bank.

23. The Borrower shall inform the Bank promptly of any notice or
intimation received from any Government, Semi-Government, Revenue, Municipal
or local or other authorities regarding any default, delay etc., by the
Borrower in payment of any dues or in the performance of the Borrower’s
obligations towards them.

24. The Borrower shall provide to the Bank all such information as the Bank
shall from time to time at its discretion require, including information
relating to financial condition and business of the Borrower.

25. The Borrower agrees to open and / or maintain with the Bank a Savings
Bank / Current Account and keep sufficient funds in the account and hereby
irrevocably authorises the bank to debit the same or any other account of the
Borrower with the Bank with the amount of each instalment of the loan and
interest thereon payable hereunder as and when it falls due. The Bank shall
also have the right to set-off the credit due in the said account or in any
other, account of the Borrower against the balance due in the said Loan

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Account at any time after such balance has become payable by the Borrower
under the terms hereof.

26. Nothing herein shall operate to prejudice the Bank’s rights or remedies
in respect of any present or future security, guarantee, obligation, or decree
for any indebtedness or liability of the Borrower to the Bank.

27. The Borrower confirms that he has not borrowed any moneys from any other
Bank or Co-operative Society or from any other source whatsoever and
whomsoever and further that so long as the Borrower continues to be indebted
or liable to the Bank in the said Loan Account or in any other Account or
manner the Borrower shall not without the previous written consent of the Bank
borrow any moneys from any other Bank or Co-operative Society or financier or
from any other source

28. The Borrower hereby agrees that the Bank may hold the hypothecated goods
and the proceeds thereof not only as a security for the said loan but also as
collateral Security for any other moneys now due or which may at any time be
due from the Borrower to the Bank whether singly or jointly with another or
others and that in addition to any general lien or similar right to which the
Bank may be entitled, by law the Bank may at any time and without notice to
the Borrower combine or consolidate all or any of the Borrower's Account with
and liabilities to the Bank and set off or transfer any sum or sums standing
to the Credit of any one or more of such account in or towards the
satisfaction of any of the liabilities of the Borrower to the Bank on any
other account or in any other respect whether such liabilities be actual or
contingent, primary or collateral and several or joint.

29. Any notice given by the Bank to the Borrower may be left at the address
given below or at the then or last known place of business or residence of the
Borrower in India. The notice may also be sent by Registered post or A/D or
UCP and such notice shall be deemed to have been given and delivered. The
Receipt of dispatch of letter being sufficient proof of posting. A certificate
signed by the Bank’s Local Manager or Accountant that the envelope was so
posted shall also be conclusive. If, by reason of absence of the Borrower from
the place mentioned below or otherwise, any such notice to the Borrower cannot
be given then the same, If inserted once as an advertisement in a newspaper
circulating in the district where the Borrower was last known to reside or
carry on business shall be deemed to have been effectually given and received
on the day on which such advertisement appears.

30. It is hereby expressly agreed that the Bank shall be at liberty to

assign the debt and the benefit of these presents and the security for the
advance and the security documents to the Industrial Development Bank of
India / Small Industries Development Bank of India / National Bank for
Agriculture and Rural Development (hereinafter referred to as the “Refinancing
Agency") as security for any refinance obtained by the Bank from said
Refinancing Agency in respect of the loan agreed to be advanced by the Bank to
the Borrower and the Borrower shall if and whenever required by the Bank to do
so, at the Borrower's own
expenses do and execute and join in doing and executing all such acts, things,
deeds, documents, or assurance as the bank may require, for the effectuation
of such assignment.

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31. The Borrower shall upon every reasonable request of the Bank or of the
Refinancing Agency allow the Bank or the Refinancing Agency or any officer,
servant or agent of the Bank or of the Refinancing Agency or any accountant
appointed by the Bank or by the said Refinancing Agency to inspect the
Borrower’s premises and the hypothecated goods and the Borrower's books of
account and vouchers for ensuring that the Borrower has duly complied with the
terms of the proposal and of these presents.

32. The Borrower will furnish the Bank with all such information as the Bank
may reasonably require for the Bank’s satisfaction as to due compliance with
the terms of the proposal and of the sanction, grant and utilisation of the
said advance and all such periodical reports and information at such times, in
such form and containing such particulars as the Bank may call for including
information relating to the financial condition of the Borrower.

33. The Bank shall be at liberty (and the Borrower hereby gives his consent
to the Bank) to furnish to the said Refinancing
Agency Bank any such information or report, whether received by the bank from
the Borrower of otherwise in the Bank's possession.

34. Nothing herein contained shall be deemed to limit or affect

prejudicially the rights and powers of the Bank under any law or under any
other documents executed or to be executed by the Borrower in favour of the
bank.

35. The Bank shall, without notice to or without any consent of the
Borrower, be absolutely entitled and have full right, power and authority to
make disclosure of any information relating to Borrower including personal
information, details in relation to documents, Loan, defaults, security,
obligations of Borrower, to the Credit Information Bureau of India (CIBIL)
and/or any other governmental/regulatory/statutory or private agency/entity,
credit bureau, RBI, the Bank’s other branches/ subsidiaries / affiliates /
rating agencies, service providers, other banks / financial institutions, any
third parties, any assignees/potential assignees or transferees, who may need
the information and may process the information, publish in such manner and
through such medium as may be deemed necessary by the publisher/ Bank/ RBI,
including publishing the name as part of willful defaulter’s list from time to
time, as also use for KYC information verification, credit risk analysis, or
for other related purposes. The Borrower waives the privilege of privacy and
privity of contract.

36. The courts of the state in which the bank lending branch is situated
will have jurisdiction for all disputes.

IN WITNESS WHEREOF, the Borrower has executed this Agreement

the day and year first above written.

Schedule "A"

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 (Short particulars of the hypothecated goods)

Schedule "B"

Amount of instalments. Date of Payment of instalments.

Rs.

Rs.

Rs.

(Signed by the above named (Signature/s of Borrower

Name/s of the Borrower)

Address of Borrower/s

THE COMMON SEAL of the within named _____________________ Ltd., was

pursuant to a resolution of its Board of Directors passed in that behalf
on the ______day of __________ 200__ hereunto affixed in the presence of
Mr._______________________________and Mr._____________________________.

NOT TO BE WITNESSED.

Note: Borrower's Loan application to be annexed.

Document checked

Date:

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In case of any discrepancy or dispute, English version will be treated
as authentic.

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