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                                                                   EXHIBIT 10.25

                   GENERAL SUBORDINATED SECURITY AGREEMENT

      SECURITY AGREEMENT, dated May __, 2004 but effective as of May 14, 2004,
between STEELBANK, INC., with offices at 5349 Maingate Drive, Mississauga,
Ontario, Canada L4W 1G6 (the "Debtor"), and ANAND DHANDA and RIYAZ JINNAH (the
"Secured Parties");

                              W I T N E S S E T H:

      WHEREAS, the Debtor is a subsidiary of Tarpon Industries, Inc. a Michigan
corporation ("Tarpon"); and

      WHEREAS, Tarpon and the Secured Parties are parties to 8.0% promissory
notes issued by the Tarpon in the aggregate principal amount of $150,000
(herein, as at any time amended, extended, restated, renewed or modified, the
"Notes"); and

      WHEREAS, it is a condition to the willingness of the Secured Parties to
accept the Notes and make the loan evidenced thereby that Debtor execute a
guaranty of even date guaranteeing Tarpon's performance under the Notes; and

      WHEREAS, Debtor's performance under the guarantee is secured by a lien on
Debtor's assets, subordinate only to the liens of Debtor's senior lenders; and

      WHEREAS, Debtor enter into this Agreement and grants to the Secured
Parties the security interest provided for herein;

      NOW, THEREFORE, FOR VALUE RECEIVED, IT IS AGREED:

      Section 1. Terms. Unless otherwise defined herein, capitalized terms used
in this Agreement shall have the meaning specified therefor in the Guaranty. As
used herein the following terms shall have the meanings specified and shall
include in the singular number the plural and in the plural number the singular:

      "Assigned Agreements" shall mean all contracts and agreements of the
Debtor.

      "Collateral" means all of the Debtor's right, title and interest in and
under or arising out of each and all of the following:

            All personal property and fixtures of the Debtor of any type or
      description, wherever located and now existing or hereafter arising or
      acquired, including but not limited to the following:

                  (i) all of the Debtor's goods including, without limitation:

                        (A) all inventory, including without limitation,
                  equipment held for lease, whether raw materials, in process or
                  finished, all material or equipment usable in processing the
                  same and all documents of title covering any inventory (all of
                  the foregoing, "Inventory"), including with-

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                  out limitation that located at the locations listed on
                  Schedule 1 annexed hereto;

                        (B) all equipment (the "Equipment") employed in
                  connection with the Debtor's business, together with all
                  present and future additions, attachments and accessions
                  thereto and all substitutions therefor and replacements
                  thereof, including without limitation that located at the
                  locations listed on Schedule 1 annexed hereto;

                  (ii) all of the Debtor's present and future accounts, accounts
            receivable, general intangibles, contracts and contract rights
            (herein sometimes referred to as "Receivables"), including but not
            limited to the Debtor's rights (including rights to payment) under
            all Assigned Agreements, together with

                        (A) all claims, rights, powers or privileges and
                  remedies of the Debtor relating thereto or arising in
                  connection therewith including, without limitation, all
                  rights of the Debtor to make determinations, to exercise any
                  election (including, but not limited to, election of remedies)
                  or option or to give or receive any notice, consent, waiver or
                  approval, together with full power and authority to demand,
                  receive, enforce, collect or receipt for any of the foregoing
                  or any property which is the subject of the Assigned
                  Agreements, to enforce or execute any checks, or other
                  instruments or orders, to file any claims and to take any
                  action which (in the reasonable opinion of the Secured
                  Parties) may be necessary or advisable in connection with any
                  of the foregoing,

                        (B) all liens, security, guaranties, endorsements,
                  warranties and indemnities and all insurance and claims for
                  insurance relating thereto or arising in connection therewith,

                        (C) all rights to property forming the subject matter of
                  the Receivables including, without limitation, rights to
                  stoppage in transit and rights to returned or repossessed
                  property,

                        (D) all writings relating thereto or arising in
                  connection therewith including without limitation, all notes,
                  contracts, security agreements, guaranties, chattel paper and
                  other evidence of indebtedness or security, all
                  powers-of-attorney, all books, records, ledger cards and
                  invoices, all credit information, reports or memoranda and all
                  evidence of filings or registrations relating thereto,

                        (E) all catalogs, computer and automatic machinery
                  software and programs, and the like pertaining to operations
                  by the Debtor in, on or about any of its plants or warehouses,
                  all sales data and other information relating to sales or
                  service of products now or hereafter manufactured on or about
                  any of its plants, and all accounting information pertaining
                  to operations in, on or about any of its plants, and all media
                  in which or on

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                  which any of the information or knowledge or data is stored or
                  contained, and all computer programs used for the compilation
                  or printout of such information, knowledge, records or data,
                  and

                        (F) all accounts, contract rights, general intangibles
                  and other property rights of any nature whatsoever arising out
                  of or in connection with the foregoing, including without
                  limitation, payments due and to become due, whether as
                  repayments, reimbursements, contractual obligations,
                  indemnities, damages or otherwise;

                  (iii) patents, patent applications, copyrights and
            intellectual property of all description;

                  (iv) all other personal property of the Debtor of any nature
            whatsoever, including, without limitation, all accounts, bank
            accounts, deposits, credit balances, contract rights, inventory,
            general intangibles, goods, equipment, instruments, chattel paper,
            machinery, furniture, furnishings, fixtures, tools, supplies,
            appliances, plans and drawings, together with all customer and
            supplier lists and records of the business, and all property from
            time to time described in any financing statement (UCC-1) signed by
            the Debtor naming the Secured Parties as secured party; and

                  (v) all additions, accessions, replacements, substitutions or
            improvements and all products and proceeds including, without
            limitation, proceeds of insurance, of any and all of the Collateral
            described in clauses (i) through (iii) above.

      "Instrument" shall have the meaning specified in Article 3 of the Uniform
Commercial Code, as in effect from time to time in the State of Michigan and
shall also include any other writing which evidences a right to the payment of
money and is not itself a security agreement or lease and is of a type which is
in the ordinary course of business transferred by delivery with any necessary
endorsement or assignment.

      "Lien" means any mortgage, pledge, hypothecation, assignment, security
interest, deposit arrangement, encumbrance (including any easement, right of
way, zoning restriction and the like), lien (statutory or other) or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any financing lease involving substantially the same economic effect
as any of the foregoing and the filing of any financing statement under the
Uniform Commercial Code or comparable law of any jurisdiction).

      "Permitted Liens" means:

            (a) Liens for taxes, assessments or other governmental charges or
      levies not at the time delinquent or thereafter payable without penalty or
      being contested in good faith by appropriate proceedings and for which
      adequate reserves in accordance with generally accepted accounting
      principles shall have been set aside on its books;

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            (b) Liens of carriers, warehousemen, mechanics, materialmen and
      landlords incurred in the ordinary course of business for sums not overdue
      or being contested in good faith by appropriate proceedings and for which
      adequate reserves shall have been set aside on its books;

            (c) Liens (other than Liens arising under the Employee Retirement
      Income Security Act of 1974, as amended, or Section 412(n) of the Internal
      Revenue Code of 1986, as amended) incurred in the ordinary course of
      business in connection with workers' compensation, unemployment insurance
      or other forms of governmental insurance or benefits, or to secure
      performance of tenders, statutory obligations, leases and contracts (other
      than for borrowed money) entered into in the ordinary course of business
      or to secure obligations on surety or appeal bonds;

            (d) judgment Liens in existence less than 60 days after the entry
      thereof or with respect to which execution has been stayed;

            (e) ground leases in respect of real property on which facilities
      owned or leased by the Debtor or any of its subsidiaries are located;

            (f) easements, rights-of-way, restrictions, minor defects or
      irregularities in title and other similar charges or encumbrances not
      interfering in any material respect with the business of the Debtor and
      its subsidiaries taken as a whole;

            (g) any interest or title of a lessor secured by a lessor's interest
      under any lease of real property on which facilities owned or leased by
      the Debtor or any of its subsidiaries are located;

            (h) a Lien ("Purchase Lien") on any asset securing indebtedness
      (including capitalized lease obligations) incurred or assumed for the
      purpose of financing the purchase price (including capitalized lease
      payments in the nature thereof) of such asset, provided that such Purchase
      Lien attaches only to the asset acquired with the proceeds of such
      indebtedness and attaches concurrently with or within ten (10) days
      following the acquisition thereof (but not including the matters referred
      to in (j) below).

            (i) the existing Liens ("Existing Liens") described on Schedule 2
      annexed hereto.

            (j) liens (the "Acquisition Liens") related to future acquisition
      that have been approved, prior to such acquisitions, but the Secured
      Parties.

      "Person" means any natural person, corporation, firm, association,
partnership, joint venture, limited liability company, joint-stock company,
trust, unincorporated organization, government, governmental agency or
subdivision, or any other entity, whether acting in an individual, fiduciary or
other capacity.

      "Receivables" has the meaning specified therefor in clause (ii) of the
definition of Collateral.

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      "Secured Obligations" means all obligations of the Debtor, whether for
fees, expenses or otherwise, now existing or hereafter arising under this
Agreement and the Guaranty.

      "Senior Indebtedness" shall mean all obligations and liabilities of and
any renewal, extension, refunding, amendment or modification of any such
indebtedness of Debtor, Debtor to Greenfield Commercial Credit (Canada), Inc.,
whether direct or indirect, absolute or contingent, joint or several, secured or
unsecured, due or to become due, no existing or later arising and whatever the
amount and however evidenced.

      Section 2. Security Interests. As security for the payment and performance
of all Secured Obligations the Debtor does hereby grant and assign to the
Secured Parties a continuing perfected security interest in all of the
Collateral, whether now existing or hereafter arising or acquired and wherever
located, subject to the priority, if any, of Existing Liens and pari passu with
the interest held by Joseph Gunnar & Co, LLC as representative of the $2,000,000
8% note holders and any Purchase Liens and Acquisition Lien.

      Section 3. Subordination. The security interest granted in this Agreement
is expressly subordinated to the security interest(s) granted to any holder of
Senior Indebtedness (as defined above) in accordance with the terms of the
Subordination Agreement among Secured Parties and Greenfield Commercial Credit
(Canada), Inc. effective May 18,2004.

      Section 4. General Representations, Warranties and Covenants. The Debtor
represents, warrants and covenants, which representations, warranties and
covenants shall survive execution and delivery of this Agreement, as follows:

            (a) This Agreement is made with full recourse to the Debtor and
      pursuant to and upon all the warranties, representations, covenants, and
      agreements on the part of the Debtor contained herein, in the Guaranty and
      otherwise made in writing in connection herewith or therewith.

            (b) Except for the security interest of the Secured Parties therein,
      the Debtor is, and as to Collateral acquired from time to time after the
      date hereof the Debtor will be, the owner of all the Collateral free from
      any lien, security interest, encumbrance or other right, title or interest
      of any Person (other than Permitted Liens) and the Debtor shall defend the
      Collateral against all claims and demands of all Persons at any time
      claiming the same or any interest therein adverse to the Secured Parties.

            (c) There is no financing statement (or similar statement or
      instrument of registration under the law of any jurisdiction) now on file
      or registered in any public office covering any interest of any kind in
      the Collateral, or intended to cover any such interest, which has not been
      terminated or released by the secured party named therein and so long as
      the Guaranty remains outstanding or any of the Secured Obligations of the
      Debtor remain unpaid, the Debtor will not execute and there will not be on
      file in any public office any financing statement (or similar statement or
      instrument of registration under the law of any jurisdiction) or
      statements relating to the Collateral, except (i) financing statements
      filed or to be filed in respect of and covering the security interest of
      the Secured Parties hereby granted and provided for and (ii) with respect
      to Permitted Liens.

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            (d) The chief executive office and chief place of business of the
      Debtor is located at the address of the Debtor listed on the signature
      page hereof, and the Debtor will not move its chief executive office and
      chief place of business except to such new location as the Debtor may
      establish in accordance with the last sentence of this Section 4(d). The
      originals of all Assigned Agreements and all documents (as well as all
      duplicates thereof) evidencing all Receivables and all other contract
      rights or accounts and other property of the Debtor and the only original
      books of account and records of the Debtor relating thereto are, and will
      continue to be, kept at such chief executive office or at such new
      location as the Debtor may establish in accordance with the last sentence
      of this Section 4(d). The Debtor shall establish no such new location
      until (i) it shall have given to the Secured Parties not less than 30
      days' prior written notice of its intention to do so, clearly describing
      such new location and providing such other information in connection
      therewith as the Secured Parties may reasonably request, and (ii) with
      respect to such new location, it shall have taken such action,
      satisfactory to the Secured Parties (including, without limitation, all
      action required by Section 8 hereof), to maintain the security interest of
      the Secured Parties in the Receivables intended to be granted at all times
      fully perfected and in full force and effect.

            (e) Debtor has no Collateral located outside of the Province of
      Ontario on the date hereof.

            (f) The name of the Debtor is as set forth on the signature page
      hereto and the Debtor shall not change such name, conduct its business in
      any other name or take title to the Collateral in any other name while
      this Agreement remains in effect without the consent of the Secured
      Parties. The Debtor has never had any name, or conducted business under
      any name in any jurisdiction, other than its name set forth on the
      signature page hereto, during the past six years other than as set forth
      in Schedule 3 annexed hereto.

            (g) At the Debtor's own expense, the Debtor will: (i) keep the
      Collateral fully insured at all times with financially sound and
      responsible insurance carriers against loss or damage by fire and other
      risks, casualties and contingencies and in such manner and to the same
      extent that like properties are customarily so insured by other entities
      engaged in the same or similar businesses similarly situated and keep
      adequate insurance at all times against liability on account of damage to
      persons and properties and under all applicable workers' compensation
      laws, by insurers and in reasonable amounts approved by the Secured
      Parties, for the benefit of the Debtor and the Secured Parties, (ii) upon
      request by the Secured Parties, promptly deliver the insurance policies or
      certificates thereof to the Secured Parties, and (iii) keep the Collateral
      in good condition at all times (normal wear and tear excepted) and
      maintain same in accordance with all manufacturer's specifications and
      requirements. Upon any failure of the Debtor to comply with its
      obligations pursuant to this Section 4(g), the Secured Parties may at its
      option, and without affecting any of its other rights or remedies provided
      herein or as a secured party under the Uniform Commercial Code, procure
      the insurance protection it deems necessary and/or cause repairs or
      modifications to be made to the Collateral and the cost of either or both
      of which shall be a lien against the Collateral added to the amount of the
      indebtedness secured hereby and payable on demand with interest at a rate
      per annum equal to 15%.

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            (h) Subject to the rights of the holders of the Senior Indebtedness,
      the Debtor hereby assigns to the Secured Parties all of Debtor's right,
      title and interest in and to any and all monies which may become due and
      payable with respect to the Collateral under any policy insuring the
      Collateral (except proceeds relating to tangible personal property which
      are applied to restoration or replacement), including return of unearned
      premium, and shall cause any such insurance company to make payment
      directly to the Secured Parties for application to amounts outstanding
      under the Note in accordance with the terms of the Note and, to the extent
      not provided therein, in such order as the Secured Parties shall
      determine.

            (i) The Debtor will not use the Collateral in violation of any
      statute or ordinance or applicable insurance policy and will promptly pay
      all taxes and assessments levied against the Collateral.

            (j) The Debtor will not sell, transfer, change the registration, if
      any, dispose of, attempt to dispose of, substantially modify or abandon
      the Collateral or any part thereof other than sales of Inventory in the
      ordinary course of business and the disposition of obsolete or worn-out
      Equipment in the ordinary course of business.

            (k) The Debtor will not assert against the Secured Parties any claim
      or defense which the Debtor may have against any seller of the Collateral
      or any part thereof or against any other Person with respect to the
      Collateral or any part thereof.

            (l) The Debtor will indemnify and hold the Secured Parties harmless
      from and against any loss, liability, damage, costs and expenses
      whatsoever arising from the Debtor's use, operation, ownership or
      possession of the Collateral or any part thereof.

            (m) The Debtor will maintain the confidentiality of all customer
      lists and not sell or otherwise dispose of such lists except that the
      Debtor shall deliver copies thereof to the Secured Parties upon its
      request, which may be made at any time and from time to time after an
      Event of Default.

            (n) The Debtor will not enter into any agreement that is
      inconsistent with the Debtor's obligations under this Agreement, without
      the prior written consent of the Secured Parties.

      Section 5. Special Provisions Concerning Assigned Agreements. The Debtor
represents, warrants and agrees as follows:

            (a) The Assigned Agreements constitute the legal, valid and binding
      obligations of the Debtor and, to the best of its knowledge, the other
      parties thereto, enforceable in accordance with their respective terms.

            (b) The Debtor will faithfully abide by, perform and discharge each
      and every material obligation, covenant and agreement to be performed by
      the Debtor under the Assigned Agreements.

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            (c) At the request of the Secured Parties, and at the sole cost and
      expense of the Debtor, the Debtor will enforce or secure the performance
      of each and every material obligation, covenant, condition and agreement
      contained in the Assigned Agreements to be performed by the other parties
      thereto.

            (d) The Debtor will not modify, amend or agree to vary any of the
      Assigned Agreements in any material respect other than in the ordinary
      course of business, or otherwise act or fail to act in a manner likely
      (directly or indirectly) to entitle any party thereto to claim that the
      Debtor is in default under the terms thereof.

            (e) The Debtor will not terminate or permit the termination of any
      Assigned Agreement, except in accordance with its terms, other than in the
      ordinary course of business.

            (f) Without the prior written consent of the Secured Parties, the
      Debtor will not, other than in the ordinary course of business, waive or
      in any manner release or discharge any party to any Assigned Agreement
      from any of the material obligations, covenants, conditions and agreements
      to be performed by it under such Assigned Agreement including, without
      limitation, the obligation to make all payments in the manner and at the
      time and places specified.

            (g) Subject to the rights of the holder of the Secured Indebtedness,
      if the Secured Parties so request after the occurrence of an Event of
      Default and unless and until it is cured, the Debtor will hold any
      payments received by it which are assigned and set over to the Secured
      Parties by this Agreement for and on behalf of the Secured Parties and
      turn them promptly over to the Secured Parties forthwith in the same form
      in which they are received (together with any necessary endorsement) for
      application to amounts outstanding under the Note in accordance with the
      terms of the Note and, to the extent not provided therein, in such order
      as the Secured Parties shall determine.

            (h) The Debtor will appear in and defend every action or proceeding
      arising under, growing out of or in any manner connected with the Assigned
      Agreements or the obligations, duties or liabilities of the Debtor and any
      assignee thereunder.

            (i) Should the Debtor fail to make any payment or to do any act as
      herein provided after 15 day's notice by the Secured Parties, the Secured
      Parties may (but without obligation on the Secured Parties's part to do so
      and without notice to or demand on the Debtor and without releasing the
      Debtor from any obligation hereunder) make or do the same in such manner
      and to such extent as the Secured Parties may deem reasonably necessary to
      protect the security interests provided hereby, including specifically,
      without limiting the general powers, the right to appear in and defend any
      action or proceeding purporting to affect the security interests provided
      hereby and the Debtor, and the Secured Parties may also perform and
      discharge each and every obligation, covenant and agreement of the Debtor
      contained in any Assigned Agreement and, in exercising any such powers,
      pay necessary costs and expenses, employ counsel and incur and pay
      reasonable attorneys' fees.

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            (j) Upon the request of the Secured Parties, the Debtor will send to
      the Secured Parties copies of all notices, documents and other papers
      furnished or received by it with respect to any of the Assigned
      Agreements.

      Section 6. Special Provisions Concerning Receivables.

            (a) As of the time when each Receivable arises, the Debtor shall be
      deemed to have warranted as to each such Receivable that such Receivable
      and all papers and documents relating thereto are genuine and in all
      respects what they purport to be, and that all papers and documents
      relating thereto:

                  (i) will be signed by the account debtor named therein (or
            such account debtor's duly authorized agent) or otherwise be binding
            on the account debtor;

                  (ii) will represent the genuine, legal, valid and binding
            obligation of the account debtor evidencing indebtedness unpaid and
            owed by such account debtor arising out of the performance of labor
            or services or the sale and delivery of merchandise or both;

                  (iii) to the extent evidenced by writings, will be the only
            original writings evidencing and embodying such obligation of the
            account debtor named therein; and

                  (iv) will be in compliance and will conform with all
            applicable federal, state and local laws (including applicable usury
            laws) and applicable laws of any relevant foreign jurisdiction.

            (b) The Debtor will keep and maintain at the Debtor's own cost and
      expense satisfactory and complete records of the Receivables, including,
      but not limited to, records of all payments received, all credits granted
      thereon, all merchandise returned and all other dealings therewith, and
      the Debtor will make the same available to the Secured Parties, at the
      Debtor's own cost and expense, at any and all reasonable times upon notice
      from the Secured Parties. The Debtor shall, at the Debtor's own cost and
      expense, deliver the Receivables (including, without limitation, all
      documents evidencing the Receivables) and such books and records to the
      Secured Parties or to its representatives upon its demand at any time
      after the occurrence of an Event of Default unless and until it is cured
      and, if prior to the Maturity Date, Acceleration. If the Secured Parties
      shall so request, the Debtor shall legend, in form and manner satisfactory
      to the Secured Parties, the Receivables and other books, records and
      documents of the Debtor evidencing or pertaining to the Receivables with
      an appropriate reference to the fact that the Receivables have been
      assigned to the Secured Parties and that the Secured Parties has a
      security interest therein.

            (c) Except in the ordinary course of business prior to an Event of
      Default and, if prior to the Maturity Date, Acceleration, the Debtor will
      not rescind or cancel any indebtedness evidenced by any Receivable or
      modify any material term thereof or make any adjustment with respect
      thereto, or extend or renew the same, or compromise or settle

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      any dispute, claim, suit or legal proceeding relating thereto, or sell any
      Receivable or interest therein, without the prior written consent of the
      Secured Parties, except that the Debtor may grant discounts in connection
      with the prepayment of any Receivable in an amount which is customary in
      the line of business in which the Debtor is engaged and consistent with
      the Debtor's past practices.

            (d) The Debtor will duly fulfill all obligations on its part to be
      fulfilled under or in connection with the Receivables and will do nothing
      to impair the rights of the Secured Parties in the Receivables.

            (e) The Debtor shall endeavor to collect or cause to be collected
      from the account debtor named in each Receivable, as and when due
      (including, without limitation, Receivables which are delinquent, such
      Receivables to be collected in accordance with generally accepted lawful
      collection procedures) any and all amounts owing under or on account of
      such Receivable, and credit forthwith (on a daily basis) upon receipt
      thereof all such amounts as are so collected to the outstanding balance of
      such Receivable. The costs and expenses (including reasonable attorney's
      fees) of collection, whether incurred by the Debtor or the Secured
      Parties, shall be borne by the Debtor.

            (f) If any of the Receivables becomes evidenced by an Instrument
      (other than a check received in payment of a Receivable and deposited in
      the ordinary course of business), the Debtor will notify the Secured
      Parties thereof, and, upon request by the Secured Parties, promptly
      deliver such Instrument to the Secured Parties appropriately endorsed to
      the order of the Secured Parties as further security for the satisfaction
      in full of the Secured Obligations.

            (g) Upon request of the Secured Parties, at any time when an Event
      of Default and, if prior to the Maturity Date, Acceleration shall exist,
      the Debtor shall promptly notify (in manner, form and substance
      satisfactory to the Secured Parties) all Persons who are at any time
      obligated under any Receivable that the Secured Parties possesses a
      security interest in such Receivable and that all payments in respect
      thereof are to be made to such account as the Secured Parties directs.

      Section 7. Special Provisions Concerning Equipment. The Debtor will do
nothing to impair the rights of the Secured Parties in the Equipment. The Debtor
shall cause the Equipment to at all times constitute and remain personal
property. The Debtor will at all times keep all Equipment insured with
financially responsible insurance companies in favor of the Secured Parties, at
the expense of the Debtor, against such perils and in such amounts as are
customary for Persons in the same general line of business as the Debtor and
operating in similar geographic locations and markets. If the Debtor shall fail
to insure the Equipment to the Secured Parties's satisfaction, or if the Debtor
shall fail so to endorse and deposit all policies or certificates with respect
thereto, the Secured Parties shall have the right (but shall be under no
obligation) to procure such insurance and the Debtor agrees to reimburse the
Secured Parties for all costs and expenses of procuring such insurance, together
with interest at a rate per annum equal to 15%. The Secured Parties may apply
any proceeds of such insurance when received by it pursuant to the terms of this
Section 7 or Section 4(h) hereof toward the payment of any of the Secured
Obligations, whether or not the same shall then be due. The Debtor retains all
liability

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and responsibility in connection with the Equipment and the liability of the
Debtor to pay the Secured Obligations shall in no way be affected or diminished
by reason of the fact that such Equipment may be lost, destroyed, stolen,
damaged or for any reason whatsoever unavailable to the Debtor.

      Section 8. Financing Statements; Documentary Stamp Taxes.

            (a) The Debtor will, at its own expense, make, execute, endorse,
      acknowledge, file and/or deliver to the Secured Parties from time to time
      such lists, descriptions and designations of Inventory, warehouse
      receipts, bills of lading, documents of title, vouchers, invoices,
      schedules, confirmatory assignments, conveyances, financing statements,
      transfer endorsements, powers of attorney, certificates, reports and other
      assurances or instruments and take such further steps relating to the
      Collateral and other property or rights covered by the security interest
      hereby granted, which the Secured Parties deems appropriate or advisable
      to perfect, preserve or protect its security interest in the Collateral.
      The Debtor hereby constitutes the Secured Parties its attorney-in-fact to
      execute and file in the name and on behalf of the Debtor such additional
      financing statements and other documents as the Secured Parties may
      request, such acts of such attorney being hereby ratified and confirmed;
      such power, being coupled with an interest, is irrevocable until the
      Secured Obligations are paid in full. Further, to the extent permitted by
      applicable law, the Debtor authorizes the Secured Parties to file any such
      financing statements and other documents without the signature of the
      Debtor or to execute the same on behalf of the Debtor. The Debtor will pay
      all applicable filing fees and related expenses in connection with any
      such financing statements.

            (b) The Debtor agrees to procure, pay for, affix to any and all
      documents and cancel any documentary tax stamps required by and in
      accordance with, applicable law and the Debtor will indemnify and hold the
      Secured Parties harmless against any liability (including interest and
      penalties) in respect of such documentary stamp taxes.

      Section 9. Special Provisions Concerning Remedies and Sale. In addition to
any rights and remedies now or hereafter granted under applicable law and not by
way of limitation of any such rights and remedies, upon the occurrence of an
Event of Default the Secured Parties shall have all of the rights and remedies
of a secured party under the Uniform Commercial Code as enacted in any
applicable jurisdiction in addition to the rights and remedies provided herein,
in the Note and in any other agreement executed in connection with the Note
whereby the Debtor has granted any Lien to the Secured Parties. Without in any
way limiting the foregoing, upon the giving of notice to the Debtor of Secured
Parties's intent to pursue any one or all of the following or any other
remedies:

            (a) Upon the occurrence of an Event of Default, and unless and until
      it is cured, the Secured Parties shall have all of the rights and remedies
      of a secured party under the Uniform Commercial Code as enacted in any
      applicable jurisdiction in addition to the rights and remedies provided
      herein, in the Note and any other document whereby the Debtor has granted
      any Lien to the Secured Parties. The Secured Parties shall have the right,
      without further notice to, or assent by, the Debtor, in the name of the
      Debtor or in the name of the Secured Parties or otherwise:

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<PAGE>

                  (i) to ask for, demand, collect, receive, compound and give
            acquittance for the Receivables or any part thereof;

                  (ii) to extend the time of payment of, compromise or settle
            for cash, credit or otherwise, and upon any terms and conditions,
            any of the Receivables;

                  (iii) to endorse the name of the Debtor on any checks, drafts
            or other orders or instruments for the payment of moneys payable to
            the Debtor which shall be issued in respect of any Receivable;

                  (iv) to file any claims, commence, maintain or discontinue any
            actions, suits or other proceedings deemed by the Secured Parties
            necessary or advisable for the purpose of collecting or enforcing
            payment of any Receivable;

                  (v) to make test verifications of the Receivables or any
            portion thereof;

                  (vi) to notify any or all account debtors under any or all of
            the Receivables to make payment thereof directly to the Secured
            Parties for the account of the Secured Parties and to require the
            Debtor to forthwith give similar notice to the account debtors;

                  (vii) to require the Debtor forthwith to account for and
            transmit to the Secured Parties in the same form as received all
            proceeds (other than physical property) of collection of Receivables
            received by the Debtor and, until so transmitted, to hold the same
            in trust for the Secured Parties and not commingle such proceeds
            with any other funds of the Debtor;

                  (viii) to take possession of any or all of the Collateral and,
            for that purpose, to enter, with the aid and assistance of any
            Person or Persons and with or without legal process, any premises
            where the Collateral, or any part thereof, are, or may be, placed or
            assembled, and to remove any of such Collateral;

                  (ix) to execute any instrument and do all other things
            necessary and proper to protect and preserve and realize upon the
            Collateral and the other rights contemplated hereby;

                  (x) upon notice to such effect, to require the Debtor to
            deliver, at the Debtor's expense, any or all Collateral to the
            Secured Parties at a place designated by the Secured Parties; and

                  (xi) without obligation to resort to other security, at any
            time and from time to time, to sell, re-sell, assign and deliver all
            or any of the Collateral, in one or more parcels at the same or
            different times, and all right, title and interest, claim and demand
            therein and right of redemption thereof, at public or private sale,
            for cash, upon credit or for future delivery, and at such price or
            prices and on such terms as the Secured Parties may determine, with
            the amounts realized from any such sale to be applied to the Secured
            Obligations in the manner determined by the Secured Parties.

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<PAGE>

      The Debtor hereby agrees that all of the foregoing may be effected without
      demand, advertisement or notice (except as otherwise provided herein or as
      may be required by law), all of which (except as otherwise provided) are
      hereby expressly waived, to the extent permitted by law. The Secured
      Parties shall not be obligated to do any of the acts hereinabove
      authorized, but in the event that the Secured Parties elects to do any
      such act, the Secured Parties shall not be responsible to the Debtor
      except for its gross negligence or willful misconduct.

            (b) The Secured Parties may take legal proceedings for the
      appointment of a receiver or receivers (to which the Secured Parties shall
      be entitled as a matter of right) to take possession of the Collateral
      pending the sale thereof pursuant either to the powers of sale granted by
      this Agreement or to a judgment, order or decree made in any judicial
      proceeding for the foreclosure or involving the enforcement of this
      Agreement. If, after the exercise of any or all of such rights and
      remedies, any of the Secured Obligations shall remain unpaid, the Debtor
      shall remain liable for any deficiency. After the indefeasible payment in
      full of the Secured Obligations, any proceeds of the Collateral received
      or held by the Secured Parlies shall be turned over to the Debtor and the
      Collateral shall be promptly reassigned to the Debtor by the Secured
      Parties without recourse to the Secured Parties and without any
      representations, warranties or agreements of any kind.

            (c) Upon any sale of any of the Collateral, whether made under the
      power of sale hereby given or under judgment, order or decree in any
      judicial proceeding for the foreclosure or involving the enforcement of
      this Agreement:

                  (i) the Secured Parties may, to the extent permitted by law,
            bid for and purchase the property being sold, and upon compliance
            with the terms of sale may hold, retain and possess and dispose of
            such property in its own absolute right without further
            accountability, and may, in paying the purchase money therefor,
            deliver any Note or claims for interest thereon and any other
            instruments evidencing the Secured Obligations or agree to the
            satisfaction of all or a portion of the Secured Obligations in lieu
            of cash in payment of the amount which shall be payable thereon, and
            the Note and such instruments, in case the amounts so payable
            thereon shall be less than the amount due thereon, shall be returned
            to the Secured Parties after being appropriately stamped to show
            partial payment;

                  (ii) the Secured Parties may make and deliver to the purchaser
            or purchasers a good and sufficient deed, bill of sale and
            instrument of assignment and transfer of the property sold;

                  (iii) the Secured Parties is hereby irrevocably appointed the
            true and lawful attorney-in-fact of the Debtor in its name and
            stead, to make all necessary deeds, bills of sale and instruments of
            assignment and transfer of the property thus sold and for such other
            purposes as are necessary or desirable to effectuate the provisions
            (including, without limitation, this Section 9) of this Agreement,
            and for that purpose it may execute and deliver all necessary deeds,
            bills of sale and instruments of assignment and transfer, and may
            substitute one or more Persons

                                       13
<PAGE>

            with like power, the Debtor hereby ratifying and confirming all that
            its said attorney, or such substitute or substitutes, shall lawfully
            do by virtue hereof; but if so requested by the Secured Parties or
            by any purchaser, the Debtor shall ratify and confirm any such sale
            or transfer by executing and delivering to the Secured Parties or to
            such purchaser all property, deeds, bills of sale, instruments or
            assignment and transfer and releases as may be designated in any
            such request;

                  (iv) all right, title, interest, claim and demand whatsoever,
            either at law or in equity or otherwise, of the Debtor of, in and to
            the property so sold shall be divested; such sale shall be a
            perpetual bar both at law and in equity against the Debtor, its
            successors and assigns, and against any and all Persons claiming or
            who may claim the property sold or any part thereof from, through or
            under the Debtor, its successors or assigns;

                  (v) the receipt of the Secured Parties or of the officer
            thereof making such sale shall be a sufficient discharge to the
            purchaser or purchasers at such sale for his or their purchase
            money, and such purchaser or purchasers, and his or their assigns or
            personal representatives, shall not, after paying such purchase
            money and receiving such receipt of the Secured Parties or of such
            officer therefor, be obliged to see to the application of such
            purchase money or be in any way answerable for any loss,
            misapplication or non-application thereof; and

                  (vi) to the extent that it may lawfully do so, and subject to
            any legal requirement that the Secured Parties act in a commercially
            reasonable manner, the Debtor agrees that it will not at any time
            insist upon, or plead, or in any manner whatsoever claim or take the
            benefit or advantage of, any appraisement, valuation, stay,
            extension or redemption laws, or any law permitting it to direct the
            order in which the Collateral or any part thereof shall be sold, now
            or at any time hereafter in force, which may delay, prevent or
            otherwise affect the performance or enforcement of this Agreement,
            the Note or any other agreement executed in connection with the Note
            whereby the Debtor has granted any Lien to the Secured Parties, and
            the Debtor hereby expressly waives all benefit or advantage of any
            such laws and covenants that it will not hinder, delay or impede the
            execution of any power granted or delegated to the Secured Parties
            in this Agreement, but will suffer and permit the execution of every
            such power as though no such laws were in force. In the event of any
            sale of Collateral pursuant to this Section, the Secured Parties
            shall, at least 10 days before such sale, give the Debtor written,
            telecopied or telex notice of its intention to sell.

      Section 10. Application of Moneys.

            (a) Except as otherwise provided herein or in the Note or Guaranty,
      all moneys which the Secured Parties shall receive, in accordance with the
      provisions hereof, shall be applied (to the extent thereof) in the
      following manner: First, to the payment of all costs and expenses
      reasonably incurred in connection with the administration and enforcement
      of, or the preservation of any rights under, this Agreement or any of the
      reasonable expenses and disbursements of the Secured Parties (including,
      without

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<PAGE>

      limitation, the reasonable fees and disbursements of its counsel and
      agents); Second, to the payment of all Secured Obligations arising out of
      the Note in accordance with the terms of the Note and, if not therein
      provided, in such order as the Secured Parties may determine; and Third,
      to the payment of all other Secured Obligations in such order as the
      Secured Parties may determine.

            (b) If after applying any amounts which the Secured Parties has
      received in respect of the Collateral any of the Secured Obligations
      remain unpaid, the Debtor shall continue to be liable for any deficiency,
      together with interest.

      Section 11. Fees and Expenses, etc. Any and all fees, costs and expenses
of whatever kind or nature, including but not limited to the reasonable
attorneys' fees and legal expenses incurred by the Secured Parties in connection
with this Agreement, the filing or recording of any documents (including all
taxes in connection therewith) in public offices, the payment or discharge of
any taxes, counsel fees, maintenance fees, fees and other costs relating to the
encumbrances or otherwise protecting, maintaining, preserving the Collateral, or
in defending or prosecuting any actions or proceedings arising out of or related
to the Collateral, shall be borne and paid by the Debtor on written demand by
the Secured Parties setting forth in reasonable detail the nature of such
expenses and until so paid shall be added to the principal amount of the Secured
Obligations and shall bear interest at a rate per annum equal to 15%. In
addition, the Debtor will pay, and indemnify and hold the Secured Parties
harmless from and against, any and all liabilities, obligations, losses, damages
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the Collateral, including (without
limitation) claims of patent or trademark infringement and any claim of unfair
competition or anti-trust violation.

      Section 12. Miscellaneous.

            (a) All notices, communications and distributions hereunder shall be
      in writing (including telecopied communication) and telecopied, personally
      delivered or delivered by Federal Express or other reputable overnight
      courier service, if to the Debtor addressed to it at its address set forth
      opposite its signature below, if to the Secured Parties, addressed to it
      at its address set forth opposite its signature below, or as to either
      party at such other address as shall be designated by such party in a
      written notice to such other party complying as to delivery with the
      terms of this Section. All such notices and other communications shall be
      effective (i) if telecopied, upon receipt by the addressee, (ii) if
      personally delivered, upon such delivery and (iii) if delivered by
      overnight courier service, on the business day following delivery thereof
      to such courier service in time for next-business-day delivery.

            (b) No delay on the part of the Secured Parties in exercising any of
      its rights, remedies, powers and privileges hereunder or partial or single
      exercise thereof, shall constitute a waiver thereof. None of the terms and
      conditions of this Agreement may be changed, waived, modified or varied
      in any manner whatsoever unless in writing duly signed by the Debtor and
      the Secured Parties. No notice to or demand on the Debtor in any case
      shall entitle the Debtor to any other or further notice or demand in
      similar or

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<PAGE>

      other circumstances or constitute a waiver of any of the rights of the
      Secured Parties to any other or further action in any circumstances
      without notice or demand.

            (c) The obligations of the Debtor hereunder shall remain in full
      force and effect without regard to, and shall not be impaired by, (i) any
      bankruptcy, insolvency, reorganization, arrangement, readjustment,
      composition, liquidation or the like of the Debtor; (ii) any exercise or
      non-exercise, or any waiver of, any right, remedy, power or privilege
      under or in respect of the Note, this Agreement or any other agreement
      executed in connection with the Note whereby the Debtor has granted any
      Lien to the Secured Parties or any other agreement executed in connection
      with any of the foregoing, the Secured Obligations or any security for any
      of the Secured Obligations; or (iii) any amendment to or modification of
      any of the foregoing; whether or not the Debtor shall have notice or
      knowledge of any of the foregoing. The rights and remedies of the Secured
      Parties herein provided are cumulative and not exclusive of any rights or
      remedies which the Secured Parties would otherwise have.

            (d) This Agreement shall be binding upon the Debtor and its
      successors and assigns and shall inure to the benefit of the Secured
      Parties and its successors and assigns, except that the Debtor may not
      transfer or assign any of its obligations, rights or interest hereunder
      without the prior written consent of the Secured Parties and any such
      purported assignment by the Debtor shall be void. All agreements,
      representations and warranties made herein shall survive the execution and
      delivery of this Agreement.

            (e) If Debtor has, forms or acquires any subsidiary, such subsidiary
      shall thereupon guaranty the Secured Obligations and enter into a security
      agreement with the Secured Parties substantially identical to this
      Agreement, all in form and substance satisfactory to the Secured Parties.

            (f) The descriptive headings of the several sections of this
      Agreement are inserted for convenience only and shall not in any way
      affect the meaning or construction of any provision of this Agreement.

            (g) Any provision of this Agreement, which is prohibited or
      unenforceable in any jurisdiction, shall, as to such jurisdiction, be
      ineffective to the extent of such prohibition or unenforceability without
      invalidating the remaining provisions hereof, and any such prohibition or
      unenforceability in any jurisdiction shall not invalidate or render
      unenforceable such provision in any other jurisdiction.

            (h) All rights, remedies and powers provided by this Agreement may
      be exercised only to the extent that the exercise thereof does not violate
      any applicable provision of law, and the provisions hereof are intended to
      be subject to all applicable mandatory provisions of law that may be
      controlling and to be limited to the extent necessary so that they will
      not render this Agreement invalid, unenforceable in whole or in part or
      not entitled to be recorded, registered or filed under the provisions of
      any applicable law.

            (i) This Agreement and the rights and obligations of the parties
      hereunder shall be construed in accordance with and be governed by the
      laws of the State of

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<PAGE>

      Michigan except to the extent that matters of title, or creation,
      perfection and priority of the security interests created hereby, or
      procedural issues of foreclosure are required to be governed by the laws
      of the state in which the Collateral, or part thereof, is located. EACH
      PARTY HERETO KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND ALL
      RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING,
      COUNTERCLAIM OR OTHER LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN
      CONNECTION WITH, THIS AGREEMENT, THE NOTE OR ANY FINANCING DOCUMENT, OR
      ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR
      WRITTEN) OR ACTIONS OF ANY SUCH PARTY. THIS PROVISION IS A MATERIAL
      INDUCEMENT FOR THE SECURED PARTY'S ENTERING INTO THIS AGREEMENT.

            (J) It is expressly agreed, anything herein, in the Note or in any
      other agreement or instrument executed in connection with the Note to the
      contrary notwithstanding, that the Debtor shall remain liable to perform
      all of the obligations, if any, assumed by it with respect to the
      Collateral and the Secured Parties shall not have any obligations or
      liabilities with respect to any Collateral by reason of or arising out of
      this Agreement, nor shall the Secured Parties be required or obligated in
      any manner to perform or fulfill any of the obligations of the Debtor
      under or pursuant to any or in respect of any Collateral.

            (k) This Agreement may be executed in any number of counterparts and
      by the different parties hereto on separate counterparts, each of which
      when so executed and delivered shall be an original, but all of which
      counterparts taken together shall be deemed to constitute one and the same
      instrument.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.

Addresses

                                                DEBTOR:

                                                STEELBANK, INC.

5349 Maingate Drive
Mississauga, Ontario L4W 1G6                    BY: /s/ Peter Farquhar
                                                    -------------------------
                                                Name: Peter Farquhar
                                                Title: Director

                                                SECURED PARTIES:

8028 Ritchie Hwy, #114                          By: /s/ ANAND DHANDA
Pasadena, MD 21122                                  ------------------------
                                                    ANAND DHANDA

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<PAGE>

Heritage Field                                  By: /s/ RIYAZ JINNAH
Burton Dassett                                      ------------------------
Southam Warwickshire cv 472 ab                      RIYAZ JINNAH
England

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