Date 1 March 2001




                              ALL ASSETS DEBENTURE


                                    GIVEN BY



                             ELCOM HOLDINGS LIMITED

                                  IN FAVOUR OF



                     LLOYDS TSB COMMERCIAL FINANCE LIMITED

<PAGE>



ORDER OF CLAUSES

1.      Covenant to Pay
2.      Charging Provisions
3.      Companys Obligations
4.      Additional Obligations of the Company
5.      Further Assurance and Power of Attorney
6.      Acts of Default
7.      Power of Possession and Sale
8.      Appointment of Receiver and his Powers
9.      Additional Powers
10.     Application of Monies
11.     Protection of Third Parties
12.     H M Land Registry
13.     Continuing and Additional Security
14.     Currency Indemnity
15.     Discharge
16.     Service of Notices and Process
17.     Jurisdiction
18.     Representations, Warranties and Undertakings by Company
19.     Transfers and Disclosures
20.     Miscellaneous
21.     Definitions and Interpretation

<PAGE>

THIS  DEBENTURE  is made on the date  referred  to  immediately  after the Fifth
Schedule hereto BY THE PARTY DESCRIBED IN THE FIRST SCHEDULE HERETO (Company) of
the one part in favour of LLOYDS TSB COMMERCIAL FINANCE LIMITED of Boston House,
The Little Green, Richmond,  Surrey TW9 1QB registered in England and Wales with
number 733011 (Security Holder) of the other part.

1.   COVENANT TO PAY

1.1  The Company agrees with the Security Holder:

     1.1.1 to pay the Secured  Monies,  which are now or shall be due, owing and
     payable  to the  Security  Holder,  in  accordance  with  the  terms of the
     transaction,  security,  instrument or other obligation  giving rise to the
     Companys  indebtedness  to the Security  Holder,  including those under the
     Financing Agreement; and

     1.1.2  to  discharge  all  obligations  and  liabilities,  whether  actual,
     accruing  or  contingent,  now or in future  due,  owing or incurred to the
     Security  Holder by the Company,  in whatever  currency  denominated and on
     whatever  account and  howsoever  arising,  whether alone or jointly and in
     whatever style, name or form and whether as principal or surety.

2.   CHARGING PROVISIONS

2.1  As security  for the payment of the Secured  Monies,  the Company with full
     title guarantee now gives the following  mortgages and charges in favour of
     the Security Holder namely:

     2.1.1a fixed charge by way of legal  mortgage on all freehold and leasehold
          property  owned by the Company,  including  but not limited to land of
          which the Company is  registered  as proprietor at H. M. Land Registry
          (details of which are set out in the Third Schedule to this deed)

     2.1.2a fixed  charge  on all of the  following  assets,  whether  now or in
          future belonging to the Company:

          (i)  the  freehold  and  leasehold   properties  of  the  Company  not
               effectively  mortgaged  under clause 2.1.1  including such as may
               hereafter be acquired;

          (ii)all fixtures and fittings  (including trade fixtures and fittings)
               and fixed plant and  machinery in, on or attached to the property
               subject to the legal  mortgage  under  clause 2.1.1 and all spare
               parts,  replacements,  modifications  and additions for or to the
               same;

          (iii)any other freehold and leasehold property which the Company shall
               own together  with all fixtures  and  fittings  (including  trade
               fixtures and  fittings)  and fixed plant and  machinery in, on or
               attached  to such  property  and all spare  parts,  replacements,
               modifications  and additions  for or to the same;

          (iv) all plant and machinery and other  equipment  listed in the Fifth
               Schedule and all spare  parts,  replacements,  modifications  and
               additions for or to the same;

          (v)  all  fixed  plant  and  machinery,  including  all  spare  parts,
               replacements, modifications and additions for or to the same, not
               listed in the Fifth Schedule;

          (vi) all goodwill, unpaid and/or uncalled capital of the Company;

          (vii)all the Companys Intellectual Property;

          (viii)all the Companys Securities;

          (ix) all loan capital,  indebtedness  or liabilities on any account or
               in any manner  owing to the Company  from any  Subsidiary  of the
               Company or a member of the Companys Group;

          (x)  all amounts  realised by an  administrator  or  liquidator of the
               Company,  upon enforcement or execution of any order of the Court
               under Part IV of the Insolvency Act 1986

     2.1.3a fixed charge upon all or any of the following assets, whether now in
          existence or coming into existence in future:

          (i)  all documents of title to any item of property  which at any time
               and  for  any  purpose  has  been or may be  deposited  with  the
               Security Holder;

<PAGE>

          (ii) the assets  mentioned in the title  documents  referred to in the
               immediately preceding sub- paragraph;

          (iii)all monies in the bank account  specified in clauses 3.1.6(i) and
               3.1.7 including  Remittances in respect of which  instructions to
               the Companys bankers have been given under clause 3.1.6 (iii);


          (iv) all  Remittances  in  respect  of the  Companys  Other  Debts and
               Non-Vesting Debts which in accordance with clause 3.1.6(ii) shall
               be  received  by the person or at the  address or post office box
               specified in that sub-clause;

          (v)  all other  Remittances in respect of Other Debts and  Non-Vesting
               Debts  received by the Company  pending their being dealt with in
               accordance with the terms of this deed or any instructions  given
               in accordance with it;

          (vi) any  account in the name of the  Company  under the control of or
               operated  in  accordance  with  the  directions  of the  Security
               Holder.

     2.1.4a fixed charge on all the Companys Other Debts and Non-Vesting  Debts,
          present and future;

     2.1.5a floating  charge on such of the moneys  present and future which the
          Company  may  receive  in  respect  of the  Companys  Other  Debts and
          Non-Vesting  Debts and which,  until any  direction  from the Security
          Holder to the contrary,  are paid into the bank account of the Company
          referred  to in  clause  3.1.8 and which  upon  such  payment  will be
          released from the fixed charge thereon;

     2.1.6a  floating  charge  on the  remainder  of the  undertaking,  property
          rights and assets of the  Company  whatsoever  and  wheresoever,  both
          present and future, not subject to the above charges.

2.2  If the  Security  Holder  shall  enforce any of the above  charges then the
     floating charges created by this deed shall immediately and without further
     formality  become fixed charges.  However,  the Security Holder may also at
     any time give written notice to the Company  immediately  converting all or
     any of the floating  charges into fixed  charges in respect of the whole or
     any part of the Mortgaged Property subject to such floating charges.

2.3  Until the Security Holder shall:

     2.3.1 enforce any of the above charges; or

     2.3.2serve any notice under clause 2.2 on the  Company,  converting  any of
          the floating charges into fixed charges; or

     2.3.3give the  directions  referred to in any of clauses 3.1.4 and 3.1.6 to
          3.1.9  inclusive;  any Remittance which is paid into the Companys bank
          account  under clause 3.1.8 shall,  be released  from the fixed charge
          created by clause 2.1.4 and shall  immediately  become  subject to the
          floating charge created by clause 2.1.5. Such release shall not in any
          way  affect the  continuation  of the fixed  charge  created by clause
          2.1.4 on the remainder of the Companys Other Debts,  outstanding  from
          time to time.

2.4  This  deed  shall  take  effect  subject  to the  provisions  of the  prior
     Encumbrances  over the  Companys  assets  detailed in the Fourth  Schedule,
     except as otherwise varied by any separate deed.

2.5  The floating charges created by this deed shall, unless otherwise agreed by
     the  Security  Holder  in  writing,  automatically  and  without  notice be
     converted into fixed charges:

     2.5.1immediately  preceding  the coming into  existence of any  Encumbrance
          (except as  detailed in the Fourth  Schedule)  or any  disposition  or
          dealing prohibited by this deed; or

     2.5.2 after an Act of Default.

3  COMPANYS OBLIGATIONS

3.1  The Company  agrees with the  Security  Holder that,  whilst this  security
     exists, it:

     3.1.1will deal with the  Non-Vesting  Debts and their Related  Rights as if
          they were Debts and their  Related  Rights  purchased  by the Security
          Holder under the Financing  Agreement and in particular  will not bank
          or deal with  Remittances  in respect of them  except by dealing  with
          them in accordance with the Financing Agreement;

     3.1.2will not sell,  transfer,  lease,  licence or dispose of the Mortgaged
          Property subject to the floating charges herein, except by way of sale
          at full value in the ordinary course of its business now being carried
          on;

<PAGE>

     3.1.3will not sell,  transfer,  lease,  license or dispose of the Mortgaged
          Property subject to the fixed charges herein without the prior written
          consent of the Security Holder but such restriction shall not prohibit
          the disposal of an asset (other than  freehold or leasehold  property)
          for the purpose of its  immediate  replacement,  modification,  repair
          and/or maintenance;

     3.1.4will deal with the Companys Other Debts outstanding and Remittances in
          accordance with the Security  Holders written  directions;  until such
          directions  are given will only deal with the Companys  Other Debts by
          way of getting in and realising the same in the ordinary course of its
          business;

     3.1.5will execute an  assignment  of the Companys  Other Debts in favour of
          the  Security  Holder in such form as the  Security  Holder  requires,
          whenever the Security Holder so demands;

     3.1.6give  instructions  in accordance  with the directions of the Security
          Holder at any time

          (i)  to debtors to pay  Remittances  in respect of the Companys  Other
               Debts  direct  into such bank  account  under the  control of the
               Security  Holder  (and  whether in the name of the Company or the
               Security  Holder) as the Security  Holder may specify and whether
               or not this is an account opened under the terms hereof and/or

          (ii) to debtors to pay  Remittances  in respect of the Companys  Other
               Debts to such  address,  or post  office box under the control of
               the  Security  Holder  or to  such  person  employed  by or  only
               accepting  instructions  from the Security Holder as the Security
               Holder may specify; and/or

          (iii)to the Companys  bankers that all Remittances in respect of Other
               Debts,  received by means of electronic  funds  transfers  direct
               into  a  bank  account  of  the  Company  ,  shall  forthwith  be
               transferred  to such bank  account  as the  Security  Holder  may
               specify (whether the specified bank account is in the name of the
               Company  or  the  Security  Holder  and  whether  or not it is an
               account  opened under the terms  hereof) but in each case without
               affecting the right of the Security  Holder under clause 3.1.4 to
               give other directions:

     3.1.7will, as directed by the Security  Holder,  open such bank accounts in
          the name of the Company with such mandates as the Security  Holder may
          specify;  such bank accounts can include separate  designated accounts
          or trust  accounts or  accounts  where the  officers  of the  Security
          Holder are  irrevocably  appointed as the only persons able to operate
          the  accounts;  will  thereafter  pay  into  such  bank  accounts  all
          Remittances  which the  Company  may  receive  in respect of its Other
          Debts;  will only deal with the monies in such  account in  accordance
          with the written  directions of the Security  Holder  (subject only to
          such  rights  as the bank at  which  the  account  is held may have in
          respect thereof);

     3.1.8until any contrary  direction,  demand or  requirement by the Security
          Holder  this deed will only pay  Remittances,  which the  Company  may
          receive in respect of the Companys  Other  Debts,  into a bank account
          under the Companys control;

     3.1.9will  only  pay  or  otherwise  deal  with  the  monies  in any of the
          Companys bank account  referred to in clause 3.1.5 in accordance  with
          the written  directions from time to time given by the Security Holder
          (subject to any rights which the bank at which the account is held has
          in respect thereof);

     3.1.10 will not, charge, sell, discount,  factor,  dispose of or, except in
          accordance with this deed,  otherwise deal with its Other Debts or the
          relative  Remittances  unless it has the prior written  consent of the
          Security Holder;

     3.1.11 after  conversion  of the floating  charges  created by clause 2.1.5
          and/or 2.1.6 into fixed charges,  will not, except as permitted by the
          Security Holder, withdraw any credit balance representing  Remittances
          from any of the Companys bank accounts under control of the Company;

     3.1.12 will  authorise  its  bankers  from  time to time  to  provide  copy
          statements  and full  particulars  of all the  Companys  accounts  and
          facilities with them whenever requested by the Security Holder;

     3.1.13 will provide  such other  information,  as the  Security  Holder may
          reasonably request regarding the Companys affairs;

     3.1.14 will,  as soon as  reasonably  practicable  after it becomes  aware,
          provide  the  Security  Holder  with  details of any present or future
          litigation,  arbitration  or  administrative  proceedings in progress,
          pending or, to the  knowledge  of the Company,  threatened  against it
          which might have a material  adverse effect on the Companys ability to
          perform its obligations under this deed;

     3.1.15 will permit the Security Holder free access at all reasonable  times
          to inspect and take copies of and  extracts  from the books,  accounts
          and records of the Company and such other  documents  as the  Security
          Holder may  require  and will  provide  the  Security  Holder with all
          information and facilities which it may require;
<PAGE>

     3.1.16 will grant the  Security  Holder or its  solicitors  on request  all
          reasonable  facilities  to  enable  it or them to  carry  out,  at the
          Companys  reasonable  expense,  such  investigation  of  title  to the
          Mortgaged Property and enquiries about it as would be carried out by a
          prudent mortgagee;


     3.1.17 will use its best  endeavours  to  detect  any  infringement  of its
          rights to the Intellectual  Property;  if aware of such  infringement,
          will immediately give the Security Holder all information available to
          it about such infringement and will commence and diligently  prosecute
          (or permit the  Security  Holder in the name but at the expense of the
          Company to  commence  and  prosecute)  all  proceedings  necessary  to
          prevent such infringement or to recover damages;

     3.1.18 will do everything needed to ensure that the Intellectual  Property,
          to  which  the  Company  is or  may  become  entitled,  is  valid  and
          subsisting  and  remains  owned by the  Company and will take all such
          actions and proceedings as are necessary to protect such  Intellectual
          Property; if any such Intellectual Property shall at any time lapse or
          become void, will do everything necessary to restore such Intellectual
          Property to the Company;

     3.1.19 will comply in all material  respects with all laws  concerning  the
          Mortgaged  Property  and  every  notice,  order,  direction,  licence,
          consent,  permission  lawfully  made or  given  in  respect  of it and
          likewise with the requirements of any competent authority;

     3.1.20 will  duly and  promptly  pay all  monies  which may  become  due in
          respect  of any of  the  Securities;  (it  being  acknowledged  by the
          Company  that the  Security  Holder  shall  not  incur  any  liability
          whatsoever for such monies;)

     3.1.21 forthwith  upon the  execution  of this deed will  deposit  with the
          Security  Holder all  certificates or documents of title in respect of
          the Securities, together as appropriate with duly executed instruments
          of transfer or assignments  thereof in blank;  (it being  acknowledged
          that the Security  Holder shall at any time be entitled to have any of
          the Securities registered either in the name of the Security Holder or
          nominees selected by the Security Holder;)

     3.1.22 will ensure the  delivery or payment to the  Security  Holder of all
          stocks, shares, Securities, rights, monies or other property accruing,
          offered or issued at any time by way of bonus,  redemption,  exchange,
          purchase, substitution, conversion, preference, option or otherwise in
          respect of any Securities or the  certificates  or other  documents of
          title to or representing the same, together with executed  instruments
          of transfer or assignments in blank; (it being  acknowledged  that the
          Security Holder may arrange for any of them to be registered either in
          the name of the Security  Holder or nominees  selected by the Security
          Holder).

4.   ADDITIONAL OBLIGATIONS OF THE COMPANY

4.1  The  Company  agrees  that,  at all times  during the  continuance  of this
     security, it:

     4.1.1will carry on the Companys  business in a proper and efficient  manner
          and will not make any material  alteration  to the Companys  business,
          constituting a change from that carried on at the date hereof;

     4.1.2will maintain  proper and up to date books of account of its business;
          will keep such books of account  and all other  documents  relating to
          the affairs of the  Company at the  Companys  registered  office or at
          such other  place  where the same  ought to be kept and will  promptly
          provide copies thereof to the Security Holder upon request;

     4.1.3will  deliver  to the  Security  Holder  the  copies  of  its  audited
          financial  statements  and any  reports  and notes  accompanying  them
          within 6 months of each year end;

     4.1.4will  punctually  pay all its debts and  liabilities  becoming due and
          payable  and which  would,  on the  winding  up of the  Company,  have
          priority over the charges created by this deed;

     4.1.5will punctually pay all outgoings  payable in respect of the Mortgaged
          Property  and  will  promptly  produce  the  receipts  for them to the
          Security Holder upon request;

     4.1.6will keep all the  Companys  freehold and  leasehold  property in good
          and substantial repair and will allow the Security Holder free access,
          at all reasonable  times,  to view the state and condition of any such
          property,  but without the Security  Holder becoming liable to account
          as a mortgagee in possession;

     4.1.7will observe and perform all the lessees  covenants in any lease under
          which  any of the  Mortgaged  Property  may be held and  will  take no
          action which might lead to such lease being surrendered or forfeited;

     4.1.8will allow the  Security  Holder,  at the expense of the  Company,  to
          carry out repairs or take any action which the  Security  Holder shall
          reasonably  consider  necessary  should the Company fail to observe or
          perform its obligations as a lessee;
<PAGE>

     4.1.9will not  exercise the powers of leasing or  accepting  surrenders  of
          leases,  conferred on a mortgagee in possession by Sections 99 and 100
          of the Law &  Property  Act 1925,  or any other  powers of  leasing or
          accepting  surrenders of leases,  without the prior written consent of
          the Security Holder;

     4.1.10 will make sure that an order of the Court is obtained, under Section
          38(4) of the Landlord and Tenant Act 1954,  excluding  the security of
          tenure provisions of that Act, before granting any lease;

     4.1.11 will insure and keep insured those parts of the  Mortgaged  Property
          as are of an insurable nature against loss or damage by fire and other
          risks usually  insured  against and such other risks that the Security
          Holder shall  reasonably  require to their full  insurable  value with
          insurers approved by the Security Holder;


     4.1.12 will make  sure that all the  Companys  insurance  policies  will be
          endorsed  with notice of the interest of the  Security  Holder in them
          and will produce to the Security  Holder the receipts for each current
          premium  within  fifteen  days  of  its  becoming  due;  failing  such
          production the Security  Holder may effect or renew any such insurance
          as the  Security  Holder  shall  reasonably  think fit at the Companys
          expense;

     4.1.13 will observe and perform all  restrictive  and other  covenants  and
          stipulations  for the time being  affecting the Mortgaged  Property or
          its use or enjoyment;

     4.1.14 will not do or allow  anything to be done on the Company?s  freehold
          or leasehold  property  which shall be treated as a  development  or a
          change of use within the meaning of the Town and Country Planning Acts
          unless the prior written consent (not to be  unreasonably  withheld or
          delayed) of the Security Holder has been obtained;

     4.1.15 will not  infringe  the Town and  Country  Planning  Acts in any way
          which  prejudices  the Security  Holders  security  over the Mortgaged
          Property;

     4.1.16 will  deposit with the  Security  Holder all deeds and  documents of
          title relating to the Companys freehold and leasehold property and the
          insurance  policies  relating  to  the  same,  (subject  only  to  the
          requirements of any prior Encumbrance or of the Companys landlord);

     4.1.17 will not  permit any person to become  entitled  to any  proprietary
          right or interest  which might affect the value of the assets  subject
          to the fixed charges herein.

4.2  If the Company  holds  property as a tenant or lessee and shall be required
     by the landlord either to insure or to reimburse the Companys  landlord for
     any  insurance  premium  paid by him then the  Company  shall be treated as
     having complied with its insuring obligation under this deed if it duly and
     promptly complies with such requirements. However this shall not affect the
     right of the Security Holder to require the Company to produce satisfactory
     evidence that the Company has complied with the landlords requirements.

5.   FURTHER ASSURANCE AND POWER OF ATTORNEY

5.1  At the Security Holders request,  the Company will immediately  sign, seal,
     execute,  deliver  and perfect  all deeds and  instruments  and do all such
     other  acts and things as the  Security  Holder or any  Receiver  appointed
     hereunder  may require in order to perfect or enforce  this  security or to
     use the  powers  given  to each of  them  in this  deed or to  enforce  the
     obligations of the Company  and/or the rights of the Security  Holder under
     this deed.

5.2  The Company will, if called upon by the Security Holder, execute a legal or
     equitable  assignment of any part of the Mortgaged Property,  in such terms
     as the Security  Holder may  require.  The Company will then give notice of
     such assignment to such persons as the Security Holder may specify and take
     such  other  steps as the  Security  Holder may  require  to  perfect  such
     assignment.

5.3  The Company  irrevocably  appoints  the  Security  Holder,  any  directors,
     officers  or  managers  for the time being of the  Security  Holder and any
     other person  authorised  by the  directors of the Security  Holder and any
     Receiver appointed hereunder, jointly and each of them severally, to be the
     lawful attorneys of the Company.  Such appointment  gives each attorney the
     power in the  Companys  name and on its  behalf  and as its act and deed to
     carry out all acts for the  purposes  set out in clauses 5.1 and 5.2.  Each
     attorney so appointed may appoint substitute  attorneys to carry out all or
     any of such  purposes.  The  Company  agrees  to  ratify  and  confirm  any
     instrument, act or thing which any such attorney or substitute attorney may
     lawfully execute or do.

6.  ACTS OF DEFAULT
<PAGE>

6.1  The Secured  Monies shall  become  payable and the charges in favour of the
     Security Holder shall  immediately  become  enforceable,  without notice or
     demand,  by the  Security  Holder at any time  after  any of the  following
     events occur:

     6.1.1if the Company shall breach any of its obligations  under this deed or
          in the Financing  Agreement or any other  agreement  with the Security
          Holder;

     6.1.2if the Company  shall  default in paying any of the Secured  Monies as
          and when they become due;

     6.1.3if the Company shall fail to give the Security Holder such information
          as may  reasonably be requested as to the business,  affairs or assets
          of the Company;

     6.1.4if any representation, warranty or undertaking at any time made by the
          Company to the Security Holder is or was, in the reasonable opinion of
          the Security Holder,  incorrect or misleading in any respect or, being
          on an undertaking, shall not be complied with by the Company;

     6.1.5if the Company  shall  dispose or attempt to dispose of its  principal
          undertaking  or a  substantial  part of it,  without the prior written
          approval of the Security Holder;

     6.1.6 if the Company shall be Insolvent;

     6.1.7if the Company  suspends or threatens to suspend a substantial part of
          its business or if the Security Holder receives information,  from the
          Company or any responsible third party,  whether orally or in writing,
          that  the  Company  is   contemplating  or  is  likely  to  suspend  a
          substantial part of its business;

     6.1.8if the Company shall commence  negotiations  with any of its creditors
          with a  view  to  the  general  readjustment  or  rescheduling  of the
          Companys indebtedness;

     6.1.9if the  Company  shall  default  under any of the  following  with any
          party:

          (i)  a trust deed;

          (ii) a loan agreement;

          (iii) an Encumbrance;

          (iv) any other  agreement  or  obligation  relating  to  borrowing  or
               financing  (including  all  liabilities  in respect of accepting,
               endorsing or discounting  any notes or bills and all  liabilities
               under  debt   purchase,   factoring,   discounting   and  similar
               agreements);

          (v)  any guarantee or indemnity;

     6.1.10 if any borrowing or any other money payable by the Company:

          (i)  becomes payable or is capable of being declared  payable prior to
               its stated date of maturity; or

          (ii) is not paid when due;

     6.1.11 if any Encumbrance created by the Company in favour of another party
          becomes enforceable;

     6.1.12 if any guarantee, indemnity or other security for any of the Secured
          Liabilities  fails or ceases  in any  respect  to have full  force and
          effect or to be  continuing  or is  terminated  or  disputed or is the
          opinion of the Security Holder in jeopardy, invalid or unenforceable;

     6.1.13 if any governmental authority permits, or procures, or threatens any
          reorganisation,  transfer or  appropriation  (whether  with or without
          compensation)  of a substantial  part of the business or assets of the
          Company;

     6.1.14 if the  Company  shall,  without  the prior  written  consent of the
          Security  Holder,  change the nature of its business or trading in any
          way which the Security Holder considers prejudicial to this security;

     6.1.15 if it is  unlawful  for the Company to perform or comply with any of
          its obligations  under this deed or under any other agreement  between
          the Company and the Security Holder or such obligations of the Company
          are not or cease to be legally valid, binding and enforceable;

     6.1.16 if, after the date of this deed,  control (as defined in Section 435
          of the  Insolvency  Act  1986)  or the  power to take  control  of the
          Company changes, without prior written consent of the Security Holder;
          or

     6.1.17 if, in the opinion of the Security Holder, a material adverse change
          occurs in the financial  condition,  results of operations or business
          of the Company.

6.2  At any time after any Act of Default:

     6.2.1the Security Holder shall cease to be under any further  commitment to
          the Company and may at any time thereafter  declare the Secured Monies
          (or such of them as the  Security  Holder  may  specify)  either to be
          immediately  due and  payable or to be payable at any time  thereafter
          immediately  on demand,  even if this  conflicts with the terms of any
          other agreement or arrangement; and/or

<PAGE>

     6.2.2the Company shall  immediately on demand provide cash cover for all of
          its contingent liabilities to the Security Holder (including under the
          Financing Agreement) and for all notes or bills accepted,  endorsed or
          discounted and all guarantees or other instruments entered into by the
          Security Holder; and/or


     6.2.3 the Security Holder may retain:

          (i)  any monies in any account referred to in clause 3.1.5; and/or

          (ii) any  monies  in  any  account  operated  by the  officers  of the
               Security Holder under clause 3.1.6; and/or

          (iii)any Remittance  received in accordance  with clause 3.1.5 (ii)for
               such period as the Security Holder reasonably considers necessary
               to ensure the  Companys  compliance  with the terms of this deed;
               and/or

     6.2.4the Security Holder may exercise in the name of the Company any voting
          rights  attached to the Securities and all powers given to trustees by
          Sections  10(3) and (4) of the Trustee Act 1925 (as amended by Section
          9 of the  Trustee  Investments  Act 1961) in  respect  of  securities,
          property  subject to a trust and any powers or rights  exercisable  by
          the  registered  holder  of  any of the  Securities  or by the  bearer
          thereof.  The  Security  Holder  will not then  need  any  consent  or
          authority from the Company.

7.   POWER OF POSSESSION AND SALE

7.1  At any time after this  security  shall  become  enforceable,  the Security
     Holder  and/ or any  Receiver  appointed  under  this  deed  may,  in their
     discretion, enter upon and take possession of the Mortgaged Property or any
     part of it. They may also at their discretion, when exercising their powers
     given in this deed,  sell,  call in,  collect and  convert  into monies the
     Mortgaged  Property or any part of it. By way of  extension of these powers
     such sale,  calling in and conversion may be done for such consideration as
     the  Security  Holder or any  Receiver  shall  consider  sufficient.  It is
     irrelevant  whether  the  consideration  shall  consist of cash,  shares or
     debentures in some other company or any other property or partly of one and
     partly of some  other  type of  consideration.  Such  consideration  may be
     immediately  payable or payable by instalments  or deferred.  Instalment or
     deferred  payments may be with or without  security and on such other terms
     as the Security Holder or the Receiver shall think fit.

8.  APPOINTMENT OF RECEIVER AND HIS POWERS

8.1  Section  109 of the Law of  Property  Act 1925  (restricting  the  power to
     appoint a receiver)  shall not apply to this deed. At any time after an Act
     of Default  or after any other  event,  as a result of which this  security
     shall  become  enforceable  or, if the  Company at any time so  requests in
     writing,  the  Security  Holder may without  further  notice to the Company
     appoint any person to be a Receiver.  Their appointment shall extend to the
     whole or any part of the Mortgaged Property. The Security Holder may remove
     any Receiver (except an administrative  receiver).  In case of such removal
     or the retirement or death of any Receiver, the Security Holder may appoint
     another  in his  place.  At the  time of his  appointment  (or at any  time
     afterwards) the Security Holder may fix the remuneration of the Receiver on
     such basis as the Security Holder shall determine. This may include a fixed
     fee or an hourly rate or a commission.

8.2  The  Security  Holder  may  appoint  more  than  one  person  to act as the
     Receiver. Where more than one person shall be appointed to act as Receiver,
     those so appointed shall carry out their duties, exercise their rights, and
     be subject to their obligations jointly as well as severally. References in
     this deed to the Receiver shall be to each and all of them as appropriate.

8.3  Any appointment,  or fixing of the remuneration of the Receiver or any such
     removal  shall  be  made  in  writing  and be  signed  by any  director  or
     authorised officer of the Security Holder.

8.4  Any Receiver  appointed  under this deed shall be the agent of the Company.
     He shall be in the same position as a Receiver  appointed  under the Law of
     Property Act 1925.  The Company shall be solely  responsible  for his acts,
     omissions,  losses,  misconduct,  defaults and  remuneration.  The Security
     Holder shall not in any way be liable or responsible  either to the Company
     or to any other person for any of them.

8.5  The  Receiver  shall,  without  the need for any consent on the part of the
     Company, have all of the following powers, unless any shall specifically be
     excluded by the terms of his  appointment.  He may exercise these powers in
     such way, at such time and on such terms as he shall  think fit,  necessary
     or
<PAGE>

     expedient and whether in his name or the name of the Company. Any Receiver,
     whether  appointed  solely or jointly,  shall have the powers  granted to a
     receiver by the Law of Property Act 1925 and the  Insolvency  Act 1986.  He
     shall also have all of the following powers:

     8.5.1to enter upon,  take  possession  of, collect and get in the Mortgaged
          Property  and for that  purpose  to have  possession  of all  records,
          correspondence and other documents relating to the Mortgaged Property;

     8.5.2to  lease  the  Mortgaged  Property,  in the  name of the  Company  or
          otherwise  (whether or not the  Receiver  shall have taken  possession
          thereof);

     8.5.3to  carry  on or  permit  the  carrying  on of all or any  part of the
          business  of  the  Company  and  to  manage,   develop,   reconstruct,
          amalgamate or diversify the Companys  business,  including  purchasing
          supplies and materials;

     8.5.4to do all  acts  which  the  Company  might do for the  protection  or
          improvement  of the  Mortgaged  Property  or for  obtaining  income or
          returns from it;

     8.5.5to raise or borrow  any money,  which may be needed  from time to time
          for any of the purposes of the Receivers  appointment,  whether in the
          name of the Company or otherwise;  for such purpose the Receiver shall
          have power to secure any monies so borrowed by mortgage or charge over
          the Mortgaged  Property,  whether ranking in priority to or pari passu
          with or after any or all of the charges created by this deed.

     8.5.6to sell or concur in  selling  the  Mortgaged  Property  including  by
          public or private treaty, by tender, for cash or on credit, in one lot
          or in parcels,  with or without special  conditions or stipulations as
          to title,  time or mode of payment of purchase  money or otherwise and
          whether forthwith upon his appointment or later;

     8.5.7to allow  the whole or any part of the sale  monies  of the  Mortgaged
          Property to remain  outstanding on mortgage of the property sold or on
          any other  security or even  without any  security  and without  being
          responsible  for any loss  caused  and with  full  power to buy in and
          rescind  or vary any  contract  for sale and to resell  without  being
          responsible for loss;

     8.5.8to let or let on hire, lease or surrender and accept surrenders of the
          Mortgaged Property;

     8.5.9to execute  assurances  of the  Mortgaged  Property in the name and on
          behalf of the Company or otherwise and to do all other acts and things
          for completing the sale of the Mortgaged Property;

     8.5.10 to sever fixtures  belonging to the Company and sell them separately
          from any other part of the Mortgaged Property;

     8.5.11 to make any  arrangement or compromise with any person in respect of
          the Mortgaged Property;

     8.5.12 to repair, decorate, furnish, maintain, alter, improve, renew or add
          to any of the  Mortgaged  Property  as he shall  think fit and  effect
          maintain,  renew or increase indemnity  insurance and other insurances
          and obtain bonds;

     8.5.13 to  settle,  arrange,  compromise,  and  submit to  arbitration  any
          accounts,  claims, questions or disputes whatsoever which may arise in
          connection  with  the  business  of the  Company  or any  part  of the
          Mortgaged Property or in any way relating to the security  constituted
          by this deed and to bring,  prosecute,  defend,  enforce,  compromise,
          submit  to  and  discontinue  any  actions,  suits,   arbitrations  or
          proceedings whatsoever, whether civil or criminal;

     8.5.14 to enter into, complete,  disclaim, abandon or disregard,  determine
          or rectify any of the  outstanding  contracts or  arrangements  of the
          Company  and allow  time for  payment  of any  debts,  either  with or
          without security;

     8.5.15 to  exercise  or permit the Company or any nominee of the Company to
          exercise  any  powers or rights  incidental  to the  ownership  of the
          Mortgaged Property, in such manner as he may think fit;

     8.5.16 to form a subsidiary of the Company and  transfer,  lease or licence
          to  such  subsidiary  or any  other  person  all or  any  part  of the
          Mortgaged Property on such terms and conditions as he may think fit;

     8.5.17 to give  complete  discharges  in  respect  of all  monies and other
          assets  which may come into the hands of the  Receiver in the exercise
          of his powers;

     8.5.18 to carry out and  enforce  specific  performance  of or  obtain  the
          benefit  of all  the  Companys  contracts  or  those  entered  into in
          exercise of the powers or authorities conferred by this deed;

     8.5.19 to make, or require the directors of the Company to make, calls upon
          the  shareholders  of the  Company in  respect  of any  capital of the
          Company;

     8.5.20 to enforce payment of any call so made by action (in the name of the
          Company or the Receiver) or in any other way;
<PAGE>

     8.5.21 to exercise  all or any of the powers and  authorities  conferred on
          the  Receiver  under the  provisions  of the Law of Property  Act 1925
          without any further consent by or notice to the Company;

     8.5.22 to demand  and get in all rents and other  income,  whether  accrued
          before or after the date of his appointment;

     8.5.23 to exercise the powers conferred on a landlord or a tenant under the
          Landlord  and  Tenant  Acts 1927 and 1954 but  without  liability  for
          powers so exercised;

     8.5.24 to do all things necessary to make sure that the Company performs or
          observes all of its obligations to the Security Holder;

     8.5.25 to  delegate  to any person,  for such time as the  Security  Holder
          shall approve, any of the powers conferred upon the Receiver;


     8.5.26 to take legal  proceedings  for all or any of the  purposes  set out
          above;

     8.5.27 to  employ  and  dismiss  managers,  solicitors,  officers,  agents,
          auctioneers, workmen and employees for the purpose of carrying out any
          of the powers and duties of the  Receiver  or the  obligations  of the
          Company at such  salaries or  remuneration  and on such other terms of
          service as the Receiver in his discretion may think fit;

     8.5.28 to have access to and make use of the premises, plant, equipment and
          accounting  and other  records of the Company and the  services of its
          staff in order to exercise his powers and duties;

     8.5.29 to do all such  other  acts and things  without  limitation,  as the
          Receiver  may  consider to be  incidental  or  conducive to the lawful
          exercise of his powers and duties.

8.6  The Security  Holder may at any time give up  possession of any part of the
     Mortgaged Property and/or withdraw from the receivership.

8.7  Whether or not a Receiver shall be appointed  under this deed, the Security
     Holder may at any time after this  security  shall have become  enforceable
     and without giving notice,  exercise all or any of the powers,  authorities
     and discretions conferred on a Receiver as set out above.

9    ADDITIONAL POWERS

9.1  In  addition  to the powers of leasing or  accepting  surrenders  of leases
     conferred on  mortgagees  by Sections 99 and 100 of the Law of Property Act
     1925,  it shall be lawful for the Security  Holder or any Receiver  without
     the restrictions contained in those Sections:

     9.1.1to grant any lease of the  Mortgaged  Property  upon such terms as the
          Security  Holder or the Receiver  shall in its absolute and unfettered
          discretion  think fit; and

     9.1.2to accept a surrender of any lease of the  Mortgaged  Property on such
          terms as the Security  Holder or the Receiver in its or his discretion
          shall think fit.

9.2  Section 103 of the Law of Property Act 1925 (restricting the power of sale)
     shall not apply.  However the power of sale and the other powers  conferred
     on mortgagees by that Act shall apply to this security but without the Acts
     restrictions as to giving notice or otherwise. Accordingly for the purposes
     of a sale or other  exercise  of any such  powers the whole of the  Secured
     Monies shall be treated as due and payable  immediately  upon the execution
     and delivery of this document.

9.3  The restrictions on the right of consolidating  mortgage securities,  which
     are contained in Section 93 of the Law of Property Act,  shall not apply to
     this security.

9.4. The Security  Holder may, at any time without  discharging  or in any other
     way  affecting  this  security or any remedy that the  Security  Holder may
     have,  grant to the Company (or to any other  person) time or indulgence or
     abstain from perfecting or enforcing any remedies,  securities,  guarantees
     or rights  which the  Security  Holder may now or  afterwards  have from or
     against the Company or any other person.

9.5  If the Security  Holder receives or is treated as having received notice of
     any subsequent  mortgage or charge affecting any of the Mortgaged  Property
     then the Security  Holder may open a new account  with the  Company.  If it
     does not open a new account,  it shall nevertheless be treated as if it had
     done so at the time when it received or was treated as having received such
     notice.  From that time all  payments  made by the Company to the  Security
     Holder  shall be credited or be treated as having been  credited to the new
     account.  Such payments  shall not operate to reduce the amount  secured by
     this  deed when the  Security  Holder  received  or was  treated  as having
     received such notice.
<PAGE>

10.  APPLICATION OF MONIES

10.1 All monies  received by the Security  Holder or by the Receiver under or by
     virtue of this deed shall be applied in the following order;

     10.1.1 in the discharge of all Liabilities having priority to the mortgages
          and charges  hereby  created or the matters  referred to  hereafter in
          this clause 10.1;


     10.1.2 in  payment  of all  costs,  charges  and  expenses  incurred  in or
          incidental to the exercise or  performance  (or attempted  exercise or
          performance)  of any of the powers or  authorities  conferred by or in
          any other way connected with this deed; and then

     10.1.3 in payment to the Receiver of his  remuneration  fixed in accordance
          with clause 8.1 of this deed; and then

     10.1.4 in payment to the Security  Holder of the Secured  Monies due to the
          Security  Holder in such order as the Security  Holder in its absolute
          discretion thinks fit; and then

     10.1.5 in payment to the Company of any surplus.

10.2 Any surplus shall not carry  interest.  The Receiver or the Security Holder
     may pay any surplus into any of the  Companys  bank  accounts  including an
     account opened  specifically  for such purpose.  The Security  Holder shall
     then have no further liability for such surplus.

10.3.Following the  enforcement  of this  security,  any monies  received by the
     Security  Holder  may  be  appropriated  by  the  Security  Holder  in  its
     discretion  in or towards  the  payment  and  discharge  of any part of the
     Secured Monies.

10.4 The  Security  Holder or the  Receiver  may credit any monies to a suspense
     account for so long and in such manner as the Security Holder may from time
     to time determine.  The Receiver may retain the same for such period as the
     Receiver and the Security Holder consider expedient.

10.5 All  monies  received  by the  Company  under any  insurance  policy on the
     Mortgaged  Property  shall be  treated  as part of the  Mortgaged  Property
     subject  only to any rights of third  parties  having  priority  and to the
     requirements of any lease of the Mortgaged Property.  They shall be applied
     at the  discretion  of the Security  Holder  either in reducing the Secured
     Monies  or  towards  making  good the loss or damage  for which the  monies
     became  payable.  Any monies received by the Company under any insurance on
     the Mortgaged  Property  shall be held on trust for payment to the Security
     Holder pending such application.

11.  PROTECTION OF THIRD PARTIES

     11.1 No person  paying or handing over monies to the Receiver and obtaining
          a discharge shall have any responsibility or liability to see to their
          correct application.

     11.2 No  person  dealing  with the  Security  Holder or the  Receiver  need
          enquire :

          11.2.1 whether  any event has  happened  giving  either  the  Security
               Holder or the Receiver the right to exercise any of his powers;

          11.2.2 as to the  propriety or  regularity  of any act  purporting  or
               intending to be an exercise of such powers;


          11.2.3 as to the  validity or  regularity  of the  appointment  of any
               Receiver purporting to act or to have been appointed as such; or

          11.2.4 whether any money remains owing upon this security.

     11.3 All the protection to purchasers  contained in Sections 104 and 107 of
          the Law of Property Act 1925 shall apply to any person purchasing from
          or dealing with the Receiver or the Security  Holder as if the Secured
          Monies had become due and the statutory power of sale and appointing a
          receiver in relation to the Mortgaged  Property had arisen on the date
          of this deed.

     11.4 No person  dealing with the Security  Holder or the Receiver  shall be
          affected by express notice that any act is unnecessary or improper.
<PAGE>

12.  H.M. LAND REGISTRY

12.1 The Company  will notify the  Security  Holder of any freehold or leasehold
     property which it now owns or which it may own after the date of this deed.
     The Company  will,  upon  request and at its cost , join with the  Security
     Holder in  registering  this security as a fixed charge  against any of the
     freehold or leasehold  property of which the Company is now  registered  or
     may in  future  apply  to be  registered  as the  proprietor  at H.M.  Land
     Registry.

12.2 The Company hereby applies to the Chief Land Registrar for a restriction to
     be entered on the Companys title to any land in the following terms:

          Except under an order of the  Registrar no  disposition  or dealing by
          the  proprietor  of the land is to be  registered or noted without the
          consent   of  the   proprietor   for  the   time   being   of   Charge
          No................

13.  CONTINUING AND ADDITIONAL SECURITY

13.1.This security is a continuing  security.  It shall apply to all the Secured
     Monies despite any interim settlement of account until a final discharge of
     this security shall be given by the Security Holder to the Company.

13.2 This security is in addition to and shall not merge or otherwise  prejudice
     or  affect  any  other  right  or  remedy  of the  Security  Holder  or any
     assignment,  bill,  note,  guarantee,  mortgage or other security now or in
     future in  favour of the  Security  Holder or held by or  available  to the
     Security Holder, whether created by the Company or any third party.

13.3 This security shall not in any way be prejudiced or affected by:

     13.3.1 any  guarantee,  mortgage or other security now or in future held by
          or  available to the Security  Holder or by the  invalidity  of any of
          them  or by the  Security  Holder  now  or  afterwards  dealing  with,
          exchanging,  releasing,  modifying or  abstaining  from  perfecting or
          enforcing  any of them or any  rights  which it may now or  afterwards
          have;  or 13.3.2 by the  Security  Holder  giving  time for payment or
          indulgence or compounding with the Company or any other persons.

14.  CURRENCY INDEMNITY

14.1 For  the  purpose  of or  pending  the  discharge  of any  of  the  Secured
     Liabilities  secured  by this  deed the  Security  Holder  or any  Receiver
     appointed hereunder may convert any monies received,  recovered or realised
     under this deed  (including the proceeds of any previous  conversion)  from
     their existing  currency into such other currency as the Security Holder or
     such Receiver may think fit. Any such  conversion  shall be effected at the
     then  prevailing  spot selling rate of  exchange,  of the Security  Holders
     bankers, for such other currency against the existing currency.

14.2 The Company  will  indemnify  the  Security  Holder  against any  shortfall
     between:

     14.2.1 any amount  received or recovered by the Security  Holder in respect
          of any of the Secured  Liabilities  which is converted  in  accordance
          with  clause  14.1  into the  currency  in which  such  liability  was
          payable;  and 14.2.2 the amount  payable to the Security  Holder under
          this deed in the currency of such liability.

15.  DISCHARGE

     15.1 Upon payment and complete discharge and performance of all the Secured
          Liabilities  and of all costs,  charges and  expenses  incurred by the
          Security Holder under or in relation to this deed, the Security Holder
          shall,  at the request and cost of the Company,  duly  discharge  this
          security and any further  security given in accordance with its terms.
          The  Security  Holder  will also  transfer  to the  Company any of the
          Mortgaged  Property  which has been  assigned  or  transferred  to the
          Security Holder.

     15.2 The right of the Security  Holder to recover the Secured  Monies or to
          enforce the terms of this deed shall not be affected by any payment or
          any act or thing  which  may be  avoided  or  adjusted  under the laws
          relating  to  bankruptcy  or  insolvency  or  under  Part  VI  of  the
          Insolvency Act 1986. Any release or discharge given or settlement made
          by the Security Holder relying on any such payment, act or thing shall
          be void and of no effect.
<PAGE>

16.  SERVICE OF NOTICES AND PROCESS

16.1 Except  as stated to the  contrary  herein,  any  written  notice  from the
     Security Holder to the Company and any  proceedings  issued by the Security
     Holder requiring service on the Company may be given or served:

     16.1.1 by delivering it at or posting it to the Companys  registered office
          or to such other address of the Company advised to and acknowledged by
          the  Security  Holder  as being  effective  for the  purposes  of this
          clause; or

     16.1.2 by  delivering  it at or posting it to any address last known to the
          Security Holder at which the Company carried on business.


     16.1.3 by handing it Companys officers;


     16.1.4 by a fax or e-mail to the Companys  number or address advised to and
          acknowledged  by the  Security  Holder as suitable  for  communication
          between the parties .

16.2 Any such notice or process shall be considered served:

     16.2.1 if delivered - at the time of delivery; or

     16.2.2 if sent by post - 48 hours from the time of posting; or

     16.2.3 if sent by fax or e-mail - at the time of transmission; or

     16.2.4 if handed over - at the time of handing over.

16.3 Any notice in  writing  by the  Company  to the  Security  Holder  required
     hereunder  shall take  effect at the time it is  received  by the  Security
     Holder at its  registered  office or at such  other  address  the  Security
     Holder may advise in writing to the Company for this purpose.

17.  JURISDICTION

17.1 This  deed  shall  be  interpreted  and  shall be  governed  by the laws of
     England.  The Company  will accept the  non-exclusive  jurisdiction  of the
     English Courts in connection with any matter arising under this deed.

18.  REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY COMPANY

18.1 The  Company  certifies  that the  execution  of this  deed  has been  duly
     authorised by a resolution  of the Companys  Board of Directors and that it
     does  not  break  any of the  provisions  of the  Companys  Memorandum  and
     Articles of Association or of any other Encumbrance,  security or agreement
     entered into prior to the date of this deed or the laws of any jurisdiction
     applying to the Company.

18.2 The Company represents and warrants to the Security Holder that:

     18.2.1 it is and will at all times be the sole  beneficial  owner with full
          title guarantee of all the Mortgaged Property and that no Encumbrances
          affect  it  except  the  Encumbrances  (if any) set out in the  Fourth
          Schedule and general liens in the ordinary course of business;

     18.2.2 it has and will at all times have the necessary  power to enter into
          and perform its obligations under this deed;

     18.2.3 this deed  constitutes  its legal,  valid,  binding and  enforceable
          obligations  and is an effective  security  over all and every part of
          the Mortgaged Property in accordance with its terms;

     18.2.4 all necessary authorisations and consents to enable or entitle it to
          enter into this deed have been  obtained and these will remain in full
          force and effect during the existence of this security;

     18.2.5  the  Company  has  acquired,   maintained  and  complied  with  all
          Environmental  Licences (if any) needed for its use or  occupation  of
          the Mortgaged Property or for the conduct of its current business;


     18.2.6 the Company has  complied  with all other  applicable  Environmental
          Laws and has not done or  permitted  any act or  omission  whereby its
          Environmental Licences (if any) could be varied or revoked;

     18.2.7 so far as  the  Company  is  aware  there  has  been  no  discharge,
          spillage, release or emission of any prescribed, dangerous, noxious or
          offensive  substance or any  controlled  waste on, into or from any of
          the Mortgaged  Property or any premises  adjoining any part of it; and
          no such  substances  or any  controlled  waste  have  been  stored  or
          disposed of on or in any part

<PAGE>
          of the Mortgaged  Property or, so far as the Company is aware,  in any
          adjoining  premises except in accordance with the  requirements of the
          applicable Environmental Laws;

     18.2.8 the  Company  is not in  breach  of and has not  incurred  or become
          subject to any civil or  criminal  liability  under any  Environmental
          Laws or the terms of any Environmental Licence;

     18.2.9 the Company has obtained and maintained all such insurance  policies
          as would be  maintained by prudent  companies  carrying on business of
          the type  carried  on by the  Company  at all  relevant  times and has
          complied in all material  respects  with the terms and  conditions  of
          such policies.

18.3 The Company  undertakes that no Encumbrances  (other than a general lien in
     the ordinary course of business)  ranking in priority to or pari passu with
     the  charges  created by this deed will  arise  after the date of this deed
     over the Mortgaged Property.

19.  TRANSFERS AND DISCLOSURES

19.1 This deed is freely transferable by the Security Holder. References in this
     deed to the Security  Holders shall include its  successors,  assignees and
     transferees.

19.2 The Company may not assign or transfer  any of its  obligations  under this
     deed. Nor may the Company enter into any transaction  which would result in
     any such obligations passing to another person.

19.3 The Security Holder may disclose any information  about the Company and any
     member of the Companys  Group and any other person  connected or associated
     with it to any member of the Security Holders Group and/or to any person to
     whom it is proposing to transfer or assign or has  transferred  or assigned
     this deed.  The Company  represents and warrants that it has and (so far as
     permitted by law) will maintain any necessary  authority by or on behalf of
     any such persons to agree to the provisions of this clause.

20.  MISCELLANEOUS

20.1 No delay or omission on the part of the Security  Holder in exercising  any
     right or  remedy  under  this deed  shall  impair  that  right or remedy or
     operate  as or be  taken to be a  waiver  of it.  Any  single,  partial  or
     defective  exercise  of any such  right or  remedy  shall not  prevent  the
     further exercise of that or any other right or remedy.

20.2 The Security  Holders rights under this deed are  cumulative.  They are not
     exclusive of any rights provided by law. They may be exercised from time to
     time and as often as the Security Holder sees fit.

20.3 Any waiver by the Security  Holder of any terms of this deed or any consent
     or approval  given by the Security  Holder under it shall only be effective
     if given in writing.  Such consent and  approval  shall then only apply for
     the  purpose  stated  and be subject to any  written  terms and  conditions
     imposed by the Security Holder.

20.4 If at any time any one or more of the provisions of this deed is or becomes
     illegal,  invalid or  unenforceable  in any  respect  under the laws of any
     jurisdiction  then neither the legality,  validity or enforceability of the
     remaining   provisions  of  this  deed  nor  the   legality,   validity  or
     enforceability  of such provision  under the law of any other  jurisdiction
     shall be in any way affected or impaired as a result.

20.5 Any certificate  signed by a director or authorised officer of the Security
     Holder  as to the  amount  of  the  Secured  Monies  at the  date  of  such
     certificate shall, in the absence of manifest error, be conclusive evidence
     of such amount and be binding on the Company.

20.6 This deed may be executed in any number of counterparts. It will then be as
     effective as if all signatures on the counterparts were on a single copy of
     this deed.

20.7 The paper on which this deed is written  is, and will  remain at all times,
     the  property of the  Security  Holder,  even after the  discharge  of this
     security.

21.  DEFINITIONS AND INTERPRETATION

<PAGE>

     21.1 In this deed any words  whose  meaning  is  defined  in the  Financing
          Agreement shall have the same meaning.

     21.2 In this deed the following  words shall have the meaning set out after
          each of them:

          Act of  Default  - in  relation to the Company - any event set out in
          clause 6.1;

          Debts; has the same meaning as in the Financing Agreement;

          Encumbrance   -  any  mortgage,  charge,  pledge,  lien,  assignment,
          hypothecation,   security  interest,  title  retention,  flawed  asset
          agreement,  preferential  right,  trust  arrangement or other security
          arrangement, whether by law or agreement.

          Environmental  Laws; - all laws,  directions and  regulations  and all
          codes  of  practice,  circulars  and  guidance  notes  issued  by  any
          competent  authority  or agency  (whether  in the  United  Kingdom  or
          elsewhere and whether or not having the force of law)  concerning  the
          protection  of the  environment  or human  health,  including  without
          limitation the  conservation  of natural  resources,  the  production,
          storage, transportation, treatment, recycling or disposal of any waste
          or any noxious,  offensive or dangerous  substance or the liability of
          any person,  whether civil or criminal, for any damage to or pollution
          of  the  environment  or the  rectification  thereof  or  any  related
          matters.

          Environmental Licence; - any permit, licence,  authorisation,  consent
          or other approval required by any Environmental Law.

          Financing  Agreement;  - the  agreement  (if  any)  for the  sale  and
          purchase of Debts and/or a conditional sale agreement and/or any other
          type of agreement between the Company and the Security Holder, details
          of which are set out in the  Second  Schedule  and any  amendments  or
          alterations  to it or them  and any  replacement  of it  which  may be
          agreed between the parties.

          Group; - in relation to any company, that company, the company and its
          Subsidiaries,  its  holding  company (as defined in Section 736 of the
          Companies Act 1985) and the Subsidiaries of that holding company.

          Insolvent;  - the happening of any of the following events in relation
          to the Company:

          1.   a distress or execution  being levied on or issued against any of
               the Mortgaged Property;

          2.   entering   or  seeking  to  enter  into  any  formal   scheme  of
               arrangement of its affairs or composition in  satisfaction of its
               debts with its creditors in accordance  with the  Insolvency  Act
               1986;

          3.   taking any  corporate  action by the  Company for its winding up,
               dissolution or  re-organisation  (otherwise than for the purposes
               of an  amalgamation  or  reconstruction  while  solvent  on terms
               previously approved in writing by the Security Holder) or for the
               appointment  of a  Receiver,  administrator,  trustee  or similar
               officer to in respect of it or all or any part of its  revenue or
               assets;

          4.   a petition being presented or an order being made for the winding
               up of the Company;

          5.   an administration order being made or applied for;

          6.   a meeting of creditors being called for winding up the Company or
               for any other purpose referred to in the Insolvency Act 1986;

          7.   a statutory demand under the Insolvency Act 1986 being served;

          8.   an encumbrancer  taking possession of any part of the undertaking
               or property of the Company or a Receiver or being  appointed over
               it;

          9.   entering into any informal arrangement or composition with or for
               the benefit of the Companys general body of creditors;

          10.  being unable to pay its debts as they become due;

          11.  being deemed insolvent under the Insolvency Act 1986.

          Intellectual   Property;   -  all  patents  (including   applications,
          improvements,  prolongations,  extensions and right to apply therefor)
          designs  (whether  registered  or  unregistered)  copyrights,   design
          rights,   trade  marks  and  service  marks  (whether   registered  or
          unregistered)  utility  models,  trade and  business  names,  knowhow,
          formulae,  inventions,  confidential  information,  trade  secrets and
          computer software  programs and systems  (including the benefit of any
          licences  or  consents  relating  to any of the  above)  and all fees,
          royalties or other rights derived  therefrom or incidental  thereto in
          any part of the world.
<PAGE>

          Mortgaged Property;  - the subject matter of the mortgages and charges
          (or any or any part of them, if the context so allows) created by this
          deed and set out at clause 2.

          Non Vesting  Debts;  - all or any Debts of the Company to be purchased
          by the Security Holder  pursuant to the Financing  Agreement but which
          fail to vest absolutely and effectively in the Security Holder for any
          reason, together with the Related Rights to such Debts.

          Other Debts; - all sums due and owing or accruing due and owing to the
          Company  whether or not on account of its  trading  both  present  and
          future except:

          1.   Non-Vesting Debts; and

          2.   any Debts whilst they remain absolutely and effectively vested in
               or held on trust for the  Security  Holder  under  the  Financing
               Agreement  and  whether  such  vesting  results  from a legal  or
               equitable assignment.

          Receiver; - includes a receiver or a manager or a receiver and manager
          or an  administrative  receiver  as defined  in  Section  29(2) of the
          Insolvency  Act 1986 or a receiver of part only of the property of the
          Company or a receiver only of the income arising from such property or
          from part of it.

          Related Rights; - has the same meaning as in the Financing Agreement.

          Remittances;  - cash,  cheques,  bills  of  exchange,  negotiable  and
          non-negotiable   instruments,   letters  of  credit,  orders,  drafts,
          promissory  notes,  electronic  payments  and any  other  instruments,
          methods or forms of payment or engagement.

          Secured Liabilities; - both the Secured Monies and the obligations and
          liabilities in clause 1.1.2.

          Secured  Monies;  - all the monies  which now or at any time in future
          may be owing due and/or payable (but remaining  unpaid) by the Company
          to the  Security  Holder  in any  manner  and  for any  reason  on any
          account;  Secured  Monies  include all such monies due by the Company,
          either alone or jointly  with any other  person or on any  partnership
          account  (even  though  the  whole  of any  part  of  such  monies  is
          represented or secured by any mortgages,  guarantees,  trust receipts,
          bills of  exchange,  leasing,  hire or  conditional  sale  agreements,
          assignments,  agreements for  discounting or factoring of Debts or any
          other agreements or securities) and whether or not any of them have or
          has fallen due or become payable and whether or not default shall have
          been made in respect  thereof;  Secured  Monies  also means any of the
          following items, whether now or in the future:

          1.   all monies due or payable under the Financing  Agreement (if any)
               or by virtue of any  guarantee or indemnity  given by the Company
               to the Security Holder;

          2.   all advances which the Security  Holder has made or shall make to
               the Company;

          3.   any  indebtedness now or hereafter to be incurred by the Security
               Holder for or at the request of the Company, including all monies
               which the Security  Holder shall pay or become  liable to pay for
               or on account of the  Company or any other  person at the request
               or order of the Company or under its  authority,  either alone or
               jointly  with any other  person and  whether or not by any of the
               following:

               3.1  the Security Holder making direct advances; or

               3.2  the Security Holder drawing, accepting, endorsing, paying or
                    discounting any Remittance; or

               3.3  the  Security  Holder  entering  into any  bond,  guarantee,
                    indemnity or letter of credit; or

               3.4  the Security Holder confirming orders; or

               3.5  the Security Holder otherwise  accepting any other liability
                    for or on behalf of the Company;

          4.   all monies  which the  Security  Holder can charge to the Company
               and all costs  charges  and  expenses  incurred  by the  Security
               Holder  following  default in  payment  of any such  monies or of
               breach by the Company of any of the provisions of this deed.

          5.   the charges of  surveyors  and/or  solicitors  instructed  by the
               Security  Holder  in  connection  with any part of the  Mortgaged
               Property

          6.   all costs and charges and expenses which the Security  Holder may
               from time to time incur in:
<PAGE>

               6.1  stamping,   perfecting,   registering   or  enforcing   this
                    security; or

               6.2  the  negotiations  for the preparation and execution of this
                    deed,   and  the  Financing   Agreement  or  any  guarantee,
                    indemnity,  priority  arrangement,   waiver  or  consent  in
                    respect of them; or

               6.3  obtaining payment or discharge of Secured Monies; or

               6.4  paying any rent, rates, taxes or outgoings for the Mortgaged
                    Property; or

               6.5  insuring, repairing,  maintaining, managing or realising any
                    part of the Mortgaged Property; or

               6.6  the  preservation  or  exercise  of any  rights  under or in
                    connection with this deed or any attempt to do so; or

               6.7  giving a discharge or release of this security; or

               6.8  dealing with or  obtaining  advice about any other matter or
                    question arising out of or in connection with this deed with
                    the intention  that the Security  Holder shall be afforded a
                    full  complete and  unlimited  indemnity  against all costs,
                    charges  and  expenses  paid or  incurred  by it and whether
                    arising  directly or  indirectly in respect of this security
                    or of any other security held by the Security Holder for the
                    Secured Monies;

          7.   all monies expended by any attorney appointed under clause 5.3 in
               exercising his powers;

          8.   interest  on all monies due and owing to the  Security  Holder at
               such rate as may from  time to time be  payable  pursuant  to any
               agreement or arrangement relating thereto.

          Securities;  - all stocks,  shares,  bonds and  securities of any kind
          whatsoever and whether marketable or otherwise and all other interests
          (including  but not limited to loan  capital)  both present and future
          held by the Company in any person and includes all allotments, rights,
          benefits and advantages  whatsoever at any time  accruing,  offered or
          arising  in  respect  of or  incidental  to the same and all  money or
          property  offered  at  any  time  by  way  of  dividend,   conversion,
          redemption, bonus, preference, option or otherwise in respect thereof.

          Security  Holder;  - where the context permits  includes its officers,
          agents and representatives.

          Subsidiary; -

          1.   a subsidiary  within the meaning of Section 736 of the  Companies
               Act 1985; and

          2.   unless the context otherwise requires,  a subsidiary  undertaking
               within the meaning of Sections  258-260 of the Companies Act 1985
               as substituted by Section 21 of the Companies Act 1989.


21.3 In the construction and interpretation of this deed:

     21.3.1 the singular  shall include the plural and vice versa;  reference to
          one gender shall include a reference to any other genders;

     21.3.2 references  to persons  shall be treated as  including  individuals,
          firms,  partnerships,  corporations,  organs  of  government,  whether
          local,  national or supra national and any other entity  recognised by
          law;

     21.3.3 references  to any Act of  Parliament  shall be treated as including
          each Act as amended,  modified or re-enacted from time to time and all
          rules,  regulations,   orders  and  subordinate  legislation  made  in
          accordance with it;

     21.3.4 references to clauses and to schedules are to those in this deed;

     21.3.5 where  the  Company  has an  obligation  to carry out an act then it
          shall be fully responsible for the costs and expenses of doing so;

     21.3.6 where the  Security  Holder  acts in  accordance  with this deed the
          Company  will  indemnify  the  Security  Holder  against all costs and
          expenses incurred;

     21.3.7 where any discretion is vested in a Receiver or the Security  Holder
          it shall be treated as an absolute discretion;

     21.3.8 each of the  provisions of this deed shall be severable and distinct
          from one another;


     21.3.9  references  to this  deed and  other  documents  referred  to in it
          includes any  supplemental  or collateral  document to each of them or
          which  is  entered  into  pursuant  to each of them  and any  document
          varying,  supplementing,  novating or replacing  the same from time to
          time;

     21.3.10  references  to charges shall be treated as references to mortgages
          and charges created by this deed;
<PAGE>

     21.3.11 references  to this  security  shall be treated as reference to the
          security created by this deed;

     21.3.12 headings to clauses are for reference only and shall not affect the
          interpretation of this deed;

     21.3.13 the meaning of general  words  introduced  by the word other or the
          word otherwise shall not be limited by reference to any preceding word
          or  enumeration  indicating  a  particular  class of acts,  matters or
          things.

<PAGE>


                                 FIRST SCHEDULE
                             (Page 3 - The Parties)

The Company

Elcom Holdings Ltd a Company registered in England and

Wales with Companies  Registry number 2838561 and whose registered  office is at
1st Floor, Bouverie House, 154 Fleet Street, London EC4A 2JD




                                 SECOND SCHEDULE
    (Clause 21 (Definition of Financing Agreement), Clauses 1.1.1 and 6.1.1)

The Agreement for the purchase of Debts entered into between the Company and the
Security Holder dated 1 March 2001




                                 THIRD SCHEDULE
                                 (Clause 2.1.1)

Land Registered at H.M. Land Registry

London Borough/County and District            Title Numbers and Description


<PAGE>


                                FOURTH SCHEDULE
                            (Clauses 2.4 and 18.2.1)

Encumbrances to which this security is subject.




                                 FIFTH SCHEDULE
                               (Clause 2.1.2(iv))
            (Plant and machinery subject to fixed charge hereunder)

<PAGE>

IN WITNESS  whereof the parties have  executed this deed on the 1st day of March
2001 which is the date on which this deed becomes effective.

THE COMPANY

EXECUTED AND DELIVERED AS A DEED        )
                                        )
BY  ELCOM HOLDINGS LIMITED              )     /s/ Robert J. Crowell
                                        )     Signature of Director
                                        )
                                        )
acting by   Robert J. Crowell           )     /s/ Peter A. Rendall
(Director)*                             )     Signature of **Director/Company
                                        )     Secretary
and*        Peter A. Rendall            )
(** Director/Company Secretary)         )
                                        )

THE SECURITY HOLDER

EXECUTED AND DELIVERED AS A DEED        )
BY LLOYDS TSB COMMERCIAL FINANCE        )
LIMITED                                 )     /s/ Peter Anderson
                                        )     Signature of Director   Attorney

acting by   Peter Anderson              )     /s/ Simon Barnes
(Director)*  Attorney                   )     Signature of **Director/Company
                                        )     Secretary
and*        Simon Barnes                )
(** Director/Attorney)                  )
                                        )


Key  *       = insert full names
     **      = delete as applicable
     ***     = insert Companys name

{17032.00019:AHP1029.DOCv}