Letter of lien and Set Off

COMPANY 1as the Company

COMPANY 2

as Secured Creditors

And

BANK 1

as Security Agent

LETTER OF LIEN AND SET OFF

This LETTER OF LIEN AND SET OFF is entered into and made on ______________, 2004.

BY

(1)              COMPANY 1, a company organised and existing under the laws of the People’s Republic of Bangladesh having its registered office at Address__________________ Bangladesh (the “Company“);

IN FAVOUR OF

(2)              THE FINANCIAL INSTITUTIONS SET FORTH IN SCHEDULE 1 HEREUNDER, THE SECURED CREDITORS;

(3)              BANK 1, as security agent for and on behalf of the Secured Creditors pursuant to the terms of the Agency Agreement (the “Security Agent“).

WHEREAS

(A)            The Secured Creditors have made available credit facilities to the Company on and subject to the terms of the Facility Agreements.

(B)             In consideration of the Secured Creditors making available the credit facilities under the Finance Documents and pursuant to the conditions of the Finance Documents, the Company has agreed, inter alia, to enter into this Letter of Lien and Set Off in favour of the Secured Creditors.

(C)             In consideration of OPIC making available the OPIC Guaranty under the OPIC Guaranty Agreement and pursuant to the conditions of the therein, the Company has agreed, inter alia, to enter into this Letter of Lien and Set Off in favour of OPIC.

INTERPRETATION

Definitions

In this Letter:

Account Bank” means Bank 1 Dhaka Branch;

Accounts” means, collectively, the accounts established pursuant to Section 2.2 of the Accounts Agreement and “Account” means any one of them;

Accounts Agreement” means the Accounts Agreement dated as of the date hereof among the Company, the Secured Parties (as defined therein), the Intercreditor Agent, the Account Bank, Security Agent and the Facility Agent;

Agency Agreement” means the Agency Agreement dated as of the date hereof among the Company, the Secured Creditors (as defined therein), the Intercreditor Agent, the Security Agent and the Facility Agent;

Credit Facility” has the meaning set forth in the Intercreditor Agreement;

Event of Default” means an “Event of Default” as defined under each of the Credit Document;

Facility Agreements” means the Finance Documents and the OPIC Guaranty;

Finance Documents” has the meaning set forth in the Intercreditor Agreement;

Intercreditor Agreement” means the Intercreditor Agreement dated as of the date hereof among the Secured Creditors, the Intercreditor Agent, the Govco Administrative Agent, the Security Agent and the Facility Agent;

Liabilities” means all present and future obligations and liabilities (whether actual or contingent or whether owed jointly or severally or in any other capacity whatsoever) of the Company to the Secured Creditors under the Facility Agreements;

OPIC” means Overseas Private Investment Corporation.

OPIC Guaranty” has the meaning given to it in the OPIC Guaranty Agreement;

OPIC Guaranty Agreement” means the OPIC Guaranty Agreement between OPIC, the Dollar Lenders, and the Govco Administrative Agent, dated as of [          ] 2004;]

Secured Creditors” has the meaning set forth in the Intercreditor Agreement; and

Security Period” means the period beginning on the date of this Deed and ending on the date upon which all of the Liabilities have been unconditionally and irrevocably paid and discharged in full.

NOW, THEREFORE, THE COMPANY HEREBY declares and acknowledges as follows:

1.             Terms defined, or incorporated by reference, in the Intercreditor Agreement have the same meaning when used in this Letter unless otherwise defined in this Letter or the context otherwise requires and the principles of interpretation therein shall apply to this Letter as if set out in full in this Letter, except that references therein to “this Agreement” shall be deemed to be references to this Letter.

2.             The Security Agent has agreed to become a party to this Letter for the better preservation and enforcement of the rights of the Secured Creditors and the Security Agent shall not assume any obligations under this Letter.

3.             In exercising its rights, powers and discretion under this Letter, each of the Secured Creditors and the Security Agent shall act in accordance with the provisions of the Intercreditor Agreement and the Security Sharing Agreement. The Security Agent is a party to this Letter in its capacity as agent for the Secured Creditors, on the terms set out in the Security Sharing Agreement. The Security Agent is not and shall not be deemed to be a fiduciary or trustee for any party.

4.             All amounts available in the accounts maintained by the Company with any bank in Bangladesh and listed in Schedule 2 and any other bank account maintained by the Company with any bank in Bangladesh from time to time (the “Accounts”) shall be kept under lien as security for the payment and discharge of the Liabilities. The Company undertakes that in event of opening of any new accounts, the details will be provided to the Security Agent and the Secured Creditors.

5.             The lien on the Accounts created pursuant to this Letter in favour of the Security Agent on behalf of the Secured Creditors and each of the Secured Creditors shall be irrevocable and shall continue until the Liabilities have been fully and irrevocably discharged.

6.             The Company hereby admits, acknowledges and declares that on the issuance of any Event of Default Notice, the Security Agent on behalf of the Secured Creditors (upon receiving instructions in accordance with the Security Sharing Agreement) or any Secured Creditor shall be entitled without any notice to the Company to withdraw the amounts available in the Accounts and apply the same (including any accrued interest thereon) towards discharging the Liabilities.

7.             The Company admits and acknowledges that until all the Liabilities have been discharged in full, any amount available in the Accounts of the Company will remain subject to the security created by this Letter.

8.             The Company hereby agrees that the Security Agent, on receiving instructions from the Secured Creditors in accordance with the Intercreditor Agreement, shall, or any Secured Creditor may, at any time or times hereinafter, following the issuance of an Event of Default Notice, without notice to the Company set off, transfer or apply all or any of the monies from time to time standing to the credit of the Accounts in or towards the discharge and satisfaction of the Liabilities.

9.             The Company further agrees that the Security Agent may set off any amount standing to the credit of any of the Accounts against any amount owed by the Company to the Secured Creditors under the Facility Agreements but unpaid and such right of set off shall be irrevocable and binding until the Liabilities have been irrevocably and fully discharged.

10.         The Company agrees that it shall forthwith upon execution of this Letter, execute and deliver to each bank with which an Account is held a notice of this Letter of Lien and Set Off in the form set out in Part 1 of Schedule 3 and procure that each such bank acknowledges such notice in the form of acknowledgement set out in Part 2 of Schedule 3, and shall deliver a copy of the acknowledgement from each bank, bearing original signatures of the parties signing the same, to the Security Agent.

11.         The Company agrees that upon opening any new Account, it shall carry out the procedure described in Paragraph 10 above with respect to the bank with which such new Account is held.

12.     The Security Agent may assign and transfer all of its respective rights and obligations hereunder to a replacement Security Agent appointed in accordance with the terms of Agency Agreement. Upon such assignment and transfer taking effect, the replacement Security Agent shall be and be deemed to be acting as Security Agent for each of the Secured Creditors for the purposes of this Deed in place of the existing Security Agent.

13.     The Company authorises the Secured Creditors and the Security Agent to execute any document necessary to transfer the security granted to the Secured Creditors under this Letter to any new Secured Creditor.

14.     This Deed shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the Company, the Secured Creditors and the Security Agent provided, however, that the Company may not assign or transfer any of its rights or liabilities hereunder without the prior written consent of the Secured Creditors and the Security Agent. The Secured Creditors shall not transfer, assign or grant their rights hereunder, including in connection with an assignment or transfer of all or any part of its interest under this Letter except in accordance with the relevant provisions of the Facility Agreements.

15.         Upon the expiry of the Security Period, the Security Agent and each Secured Creditor shall, at the cost of and upon a request from the Company, take such action as is necessary to release the lien on Accounts created under this Letter.

16.         The Company declares that all necessary corporate formalities including board approval, statutory and government approvals have been adopted and/or complied with in connection with the execution of this instrument.

17.         The Company hereby agrees that in the event of any conflict between the terms of this Letter and any procedures regarding the operation of any of the Accounts agreed between the Company and the bank with whom such account is held, this Letter shall prevail.

18.         Any provision of this Letter which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability but that shall not invalidate the remaining provisions of this Letter or affect such provision in any other jurisdiction.

19.         This Letter shall be governed by and construed and interpreted in accordance with the laws of the People’s Republic of Bangladesh.

SCHEDULE 1  – LIST OF SECURED CREDITORS

Part A – Dollar Lenders

(1)              Company 3

(2)              Bank 1

(3)              Company 4

Part B – Citi/EBL Lenders

(1)              Bank 1

(2)              Bank 2

Part C – Corporate Lenders

(1)              Bank 3

(2)              Bank 4

(3)              Bank 5

(4)              Bank 6

(5)              Company 5

(6)              Bank 7

Part D – Refinancing Lenders

(1)              Bank 2

(2)              Company 6

(3)              Bank 8

Part E – L/C Lenders

(1)              Bank 3

(2)              Bank 6

(3)              Bank 2

(4)              Bank 8

(5)              Bank 9

(6)              Bank 7

Part F – Working Capital Lenders

(1)              Bank 3

(2)              Bank 4

(3)              Bank 5

(4)              Bank 6

(5)              Bank 2

(6)              Bank 8

(7)              Bank 7

Part G – OPIC

SCHEDULE 2
Description of the Accounts

No. Name of the Bank Account No. Type of Account Name of Account Remarks
1.                 1
2.
3.                 1
4.                 1
5.
6.
7.                 1
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34. Debt Payment Account

SCHEDULE 3
Part 1

Form of Notice of Letter of Lien

(On letterhead of Company)

To:       [Account Bank]

Date: [      ]

Dear Sirs,

1.                 We hereby give you notice of a Letter of Lien and Set Off dated _______________________ from ourselves in favour of [          ] (the “Security Agent“), ______________, ________________, ___________________, ___________________ and _____________________ (the “Letter of Lien“) creating a lien over our right, title and interest in and to account number [          ], account name [          ] (including any renewal or redesignation of such account ) and all monies standing to the credit of that account from time to time (the “Account“).

2.                 Please note that we have agreed with the Security Agent as agent for the Secured Creditors and each Secured Creditor under the Letter of Lien that, amongst other things, upon notification to you from the Security Agent or any Secured Creditor that an Event of Default Notice has been issued:

2.1.1       our authority to make any transfer from the Account (save as instructed by the Security Agent or any Secured Creditor) ceases;

2.1.2              we shall have no further right to withdraw or require that any moneys be released or transferred from the Account or otherwise to give any instructions in relation thereto; and

2.1.3              at all times thereafter you are hereby authorised and instructed by us to act solely on the written instructions of the Security Agent or any Secured Creditors (including, but not limited to, in relation to the making of any transfer from the Account).

3.                 Please accept this notice by signing the enclosed acknowledgement and returning it to the Security Agent at [                   ] marked for the attention of [                 ].

Yours faithfully

….…………………….

for and on behalf of

______________________________
SCHEDULE 3
Part 2

Form of Acknowledgement of Letter of Lien

To:       [Security Agent]

[Address]

[Date]

Dear Sirs

At the request of [          ] (the “Company“) in a notice of a letter of lien and set-off (the “Notice“) to us dated[          ], we agree to accept the terms of the Notice and deliver to you in accordance with the Notice this acknowledgement and we confirm and agree that:

(i)                   we have received the Notice together with a copy of the Letter of Lien referred to therein and acknowledge its form and content;

(ii)                 we will act in accordance with the terms of the Notice;

(iii)                we have noted in the Notice the restrictions imposed upon the Company and the authority of the Security Agent and the Secured Creditors in respect of the Account and will not act in such a way as to breach those restrictions or to ignore the authority of the Security Agent or any Secured Creditor;

(iv)                we have not previously received any other notice of assignment or letter of lien relating to the Account; and

(v)                 we waive all rights which we may have at any time to set-off any amounts owed to us at any time by the Company against any amounts standing to the credit of the Account for so long as the Letter of Lien remains in force.

Terms defined in the Notice have the same meanings when used herein, unless otherwise stated.

Yours faithfully

______________________

for and on behalf of

[          ]

as Account Bank

IN WITNESS WHEREOF the Company signs and executes this Letter of Lien and Set Off on the day first written above.

COMPANY 1

The common seal of

COMPANY 1

was affixed hereto in the presence of

acting in accordance with the laws of

the People’s Republic of Bangladesh

under the authority of COMPANY 1

Limited pursuant to its board resolution

dated ___________________

SIGNATORIES

FOR COMPANY 1

___________________________

The common seal of

COMPANY 1

was affixed hereto in the presence of

___________________________

acting in accordance with the laws of

the People’s Republic of Bangladesh

under the authority of COMPANY 1

pursuant to its board resolution

dated ________________

DOLLAR LENDERS

GOVCO, INC.

By:  ……………………………………..

Name:

Title:

COMPANY 4

By:  ……………………………………..

Name:

Title:

______/            LENDERS

BANK 2

By:  ……………………………………..

Name:

Title:

BANK 1

DHAKA BRANCH

By:  ……………………………………..

Name:

Title:

CORPORATE LENDERS

BANK 3

By:  ……………………………………..

Name:

Title:

BANK 4

By:  ……………………………………..

Name:

Title:

BANK 5

By:  ……………………………………..

Name:

Title:

BANK 6

By:  ……………………………………..

Name:

Title:

COMPANY 5

By:  ……………………………………..

Name:

Title:

BANK 7

By:  ……………………………………..

Name:

Title:

REFINANCING LENDERS

BANK 2

By:  ……………………………………..

Name:

Title:

COMPANY 6

By:  ……………………………………..

Name:

Title:

BANK 8

By:  ……………………………………..

Name:

Title:

L/C LENDERS

BANK 6

By:  ……………………………………..

Name:

Title:

BANK 2

By:  ……………………………………..

Name:

Title:

BANK 8

By:  ……………………………………..

Name:

Title:

BANK 9

By:  ……………………………………..

Name:

Title:

BANK 7

By:  ……………………………………..

Name:

Title:

BANK 3

By:  ……………………………………..

Name:

Title:

WORKING CAPITAL LENDERS

BANK 7

By:  ……………………………………..

Name:

Title:

BANK 3

By:  ……………………………………..

Name:

Title:

BANK 6

By:  ……………………………………..

Name:

Title:

BANK 2

By:  ……………………………………..

Name:

Title:

BANK 8

By:  ……………………………………..

Name:

Title:

BANK 4

By:  ……………………………………..

Name:

Title:

BANK 5

By:  ……………………………………..

Name:

Title:

SECURITY AGENT

BANK 1

By:  ……………………………………..

Name:

Title:

SCHEDULE 1

LIST OF SECURED CREDITORS

DOLLAR LENDERS

Lenders Contact Details
Company 3
Company 4

CITI/EBL LENDERS

Lenders Contact Details
Bank 1
Bank 2

CORPORATE LENDERS

Lenders Contact Details
Bank 3
Bank 4
Bank 5
Bank 6
Company 5
Bank 7

REFINANCING LENDERS

Lenders Contact Details
Bank 2
Company 6
Bank 8

L/C LENDERS

Lenders Contact Details
Bank 6
Bank 2
Bank 8
Bank 9
Bank 7
Bank 3

WORKING CAPITAL LENDERS

Lenders Contact Details
Bank 7
Bank 3
Bank 6
Bank 2
Bank 8
Bank 4
Bank 5

Drafted by:

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M.L.Hotel Tower Ltd,208,Shahid Syed Nazrul Islam Sarani,
Bijoy Nagar, Dhaka-1000.
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