Vettin of Pari Passu security sharing Agreement on Company

Dated: October 18, 2005

Mr. AFirst Assistant Vice PresidentBank 1

Banani Branch

73/B, Kemal Ataturk Avenue

Banani Commercial Area

Dhaka

 Mr. MSenior Vice President & ManagerBank 1

Banani Branch

73/B, Kemal Ataturk Avenue

Banani Commercial Area

Dhaka

Dear Sir,

RE:     VETTING OF PARI PASSU SECURITY SHARING AGREEMENT A/C COMPANY 1

We refer to your letter dated 03.10.2005 on the above subject.

We have perused the draft of the Lender’s Pari-Passu Security Sharing Agreement (the ‘Agreement’) to be executed among Arab Bangladesh Bank Limited, Bank 1 and Company 1. Our opinion on the Agreement is as follows:

Clause of the Agreement Our Observation
Particulars of Bank 1 Please replace ‘The Bank 1’ by ‘Bank 1’
Recital B Please replace ‘executed between BANK 1 and the Borrower’ by ‘issued by BANK 1 and duly accepted by the Borrower (hereinafter referred to as the ‘BANK 1 Sanction Advice’)’.In your letter it is mentioned that the total credit facilities is Tk. 8.85 crore but the amount here is 11.35 crore. Please clarify.
Recital C Please replace ‘executed between ABBL and the Borrower’ by ‘issued by ABBL and duly accepted by the Borrower (hereinafter referred to as the ‘ABBL Sanction Letter’)’.
Numbering of Recital C & D Please renumber the last two recitals as D & E
Recital D We suggest to rephrase recital B as follows:

“BANK 1 and ABBL have agreed to share the security interests over the fixed and floating assets of the Borrower on pari passu basis in the manner stipulated hereunder in Section 3”
Section-1, Definition Please insert the following definition in Section 1.1:

“Sanction Letters” means collectively the BANK 1 Sanction Advice & ABBL Sanction Letter and “Credit Contract” means any one of them.
Section-1, Definition of ‘Credit Facility’ Please replace the definition of ‘Credit Facility’ with the following:

‘Facilities’ means collectively the BANK 1 Loan and ABBL Loan and ‘Facility means any of them.
Section 3.1.3 In Recital B, it is mentioned that BANK 1 Loan is secured by two letter of hypothecation. But in this clause only one hypothecation is mentioned.  Please amend accordingly.
Section 5.1 In line 5 of Section 5.1 the word ‘Agreement’ should be replaced with the words ‘Sanction Letters’.
Section 5.2 In line 2 of Section 5.2 the word ‘Loans’ should be replaced with the words ‘Facilities’.
New Clause to be added Please add the following new clauses:

“9.5 No failure or delay by any of the Chargees in exercising any right, power or remedy shall operate as a waiver thereof or otherwise impair any of its rights, powers or remedies. No single or partial exercise of any such right shall preclude any other or further exercise thereof or the exercise of any other legal right. No waiver of any such right shall be effective unless notice is given in writing.

9.6 This Agreement shall remain in force till the Borrower has adjusted all of its Secured Indebtedness.

9.7 Neither this Agreement nor any terms hereof may be changed, waived, discharged, or terminated unless such change, waiver, discharge or termination is in writing signed by all the parties hereto.

9.8 There shall be 3 (three) engrossment of this Agreement on stamp papers, one each to be furnished to the Chargees and the Borrower all of which constitute one agreement and each of which shall constitute an original.”
Signature of the Borrower The Borrower is a necessary party in the Pari-Passu Security Sharing Agreement but the Signature Column does not provide scope for the signature of the Borrower. Please amend accordingly.
General All blanks should be filled in and appropriate dates should be inserted. Also ensure all the commercial terms and conditions throughout the Agreement.Please ensure that the Agreement is executed in non-judicial stamp of Tk. 150.00 only.

Except the above, we are of the opinion that the Agreement is in order.

All papers/documents referred to us are returned herewith.

Should you have any query, do not hesitate to contact us.

Thanking you.

Yours faithfully,

_______________

Barrister-at-Law

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