**Exhibit 10.3.3**

 
|                 | ** ** | **Major Client Group**                        |
|----------------------|------------|-----------------------------------------------|
| Tel:  (02) 9237 9731 | ** ** | ** **                                    |
| Fax:  (02) 9237 9773 |       | Level  23  255 George Street  SYDNEY NSW 2000 |

 

 

13th July 2004

 

The Directors

Channell Pty Limited

Q3, 391 Park Road

REGENTS PARK NSW 2143

 

Dear Sirs,

 

**BANKINGFACILITIES**

 

Further to ourrecent discussions we are pleased to advise that National Australia BankLimited ABN 12 004 044 937 (the **Bank**) hasagreed to provide the facilities (each a **Facility** andcollectively the **Facilities**) described below toChannell Pty Limited ABN 29 002 735 622 (the **Company**).The word **Borrower** used in this letter means the.

 

The Facilitiesare offered subject to the terms and conditions of this letter of offer and thenormal conditions applicable to Bank facilities of this sort and this letter ofoffer supersedes all prior understandings and agreements between the Bank andthe Borrower, whether written or oral, unless specified in this letter ofoffer.

 

**DEBTORFINANCE FACILITY**

 
| **Company:**         |   | Channell  Pty Limited ABN 29 002 735 622                                                                                                                                                                                  |
|----------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                 |   |                                                                                                                                                                                                                      |
| **Limit:**           |   | $1,200,000  (One million two hundred thousand dollars).                                                                                                                                                                   |
| ** **           |   |                                                                                                                                                                                                                      |
| **Purpose:**         |   | To  cover financial requirements of the day to day operations of the Borrower.                                                                                                                                            |
|                 |   |                                                                                                                                                                                                                      |
| **Purchase Charge:** |   | 1.25%  per annum, charged monthly. This fee is calculated on the Limit or peak debt,  whichever is the greater.                                                                                                           |
|                 |   |                                                                                                                                                                                                                      |
| **Interest:**        |   | The  30 day BBSY bid rate shown at approximately 10.10 am (Sydney time) on page “**BBSY** on the Reuters Monitor System” on the day the  facility is drawn and then monthly thereafter, plus a margin of 1.25%. |
| ** **           |   |                                                                                                                                                                                                                      |
| ** **           |   | The  BBSY Rate is currently 5.47% per annum, variable.                                                                                                                                                                    |
| ** **           |   |                                                                                                                                                                                                                      |
|                 |   | Interest  is payable monthly in arrears on the last business day of each month, and  will be debited to the Participating Company’s account.                                                                         |

 

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| **Expiry Date:** |   | 31st  July 2005. The availability of this Facility and its repayment are at  all times at the Bank’s discretion.                                                                                                                                                                                                                                                 |
|------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|             |   |                                                                                                                                                                                                                                                                                                                                                                       |
| **Conditions:**  |   | The  terms contained in the **Annexure F, Debtor  Finance Facility Agreement (“Agreement”)- Terms** attached to this  letter of offer.                                                                                                                                                                                                                           |
| ** **       |   |                                                                                                                                                                                                                                                                                                                                                                       |
| ** **       |   | Fundamentally,  the Agreement sets out the procedure and conditions for the future sale to  the Bank of debts arising out of your business. Under the Agreement, you may  from time to time offer to sell the Bank debts by delivering an offer  document called an Invoice Statement. It is then up to the Bank, in its  discretion, whether or not to accept your offer. |
| ** **       |   |                                                                                                                                                                                                                                                                                                                                                                       |
|             |   | The  Agreement sets our all the terms and conditions of the facility. The terms of  this letter are in addition to the Agreement.                                                                                                                                                                                                                                          |
|             |   |                                                                                                                                                                                                                                                                                                                                                                       |

 

**GUARANTEESBY BANK FACILITY**

 
| **Company:**     |       | Channell  Pty Limited ABN 29 002 735 622                                                                                                                                                                                                                                                                                       |
|------------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|             |       |                                                                                                                                                                                                                                                                                                                           |
| **Limit:**       |       | $342,048  (Three hundred and forty two thousand and forty eight dollars).                                                                                                                                                                                                                                                      |
|             |       |                                                                                                                                                                                                                                                                                                                           |
| **Purpose:**     |       | To  allow for the issue of performance guarantees in the form of the Bank’s usual  Bank Guarantee.                                                                                                                                                                                                                        |
| ** **       | ** ** | ** **                                                                                                                                                                                                                                                                                                                     |
| **Fees**:        |       | An  establishment fee of 3.00% per annum is payable on establishment of each  guarantee and thereafter calendar half-yearly in advance calculated by  reference to the aggregate of all guarantees then on issue and adjusted each  subsequent half-year until the Bank’s liability under all guarantees has  terminated. |
|             |       |                                                                                                                                                                                                                                                                                                                           |
| **Conditions:**  |       | Subject  to the Bank’s usual terms and conditions documented in **Annexure D**.  Guarantees will not be issued unless the Bank receives an executed Guarantee  by Bank Indemnity and Request Form. No guarantee will be issued after the  Expiry Date.                                                                    |
|             |       |                                                                                                                                                                                                                                                                                                                           |
| **Expiry Date:** |       | 31st  July 2005.                                                                                                                                                                                                                                                                                                          |

 

**STANDBYLETTER OF CREDIT FACILITY**

 
| **Company:** |   | Channell  Pty Limited ABN 29 002 735 622                      |
|--------------|--------|---------------------------------------------------------------|
|         |   |                                                          |
| **Limit:**   |   | USDL45,000  (Forty five thousand United States dollars).      |
|         |   |                                                          |
| **Purpose:** |   | To  enable the establishment of documentary letter of credit. |
|         |   |                                                          |
| **Fees:**    |   | An  establishment fee of 3.00% per annum is payable on        |

 

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| ** **       |   | establishment  of each guarantee and thereafter calendar half-yearly in advance calculated  by reference to the aggregate of all guarantees then on issue and adjusted  each subsequent half-year until the Bank’s liability under all guarantees has  terminated. |
|------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|             |   |                                                                                                                                                                                                                                                                    |
| **Conditions:**  |   | Subject  to the Bank’s usual terms and conditions documented in **Annexure D**  and including without limitation a duly executed Documentary Credit  Agreement.                                                                                                    |
|             |   |                                                                                                                                                                                                                                                                    |
| **Expiry Date:** |   | 15th  March 2005.                                                                                                                                                                                                                                                  |

 

**REVOLVINGLEASE LIMIT**

 
| **Company:**     |       | Channell  Pty Limited ABN 29 002 735 622                                                                                                                           |
|------------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **       | ** ** | ** **                                                                                                                                                         |
| **Limit:**       |       | $250,000  (Two hundred and fifty thousand dollars).                                                                                                                |
| ** **       | ** ** | ** **                                                                                                                                                         |
| **Purpose:**     |       | To  purchase equipment under lease arrangements.                                                                                                                   |
| ** **       | ** ** | ** **                                                                                                                                                         |
| **Fee:**         |       | As  agreed for each individual lease.                                                                                                                              |
| ** **       | ** ** | ** **                                                                                                                                                         |
| **Conditions:**  |       | Subject  to the Bank’s usual terms and conditions documented separately, and including  without limitation the Bank’s duly executed lease documentation. |
| ** **       | ** ** | ** **                                                                                                                                                         |
| **Expiry Date:** |       | 31st  July 2005                                                                                                                                               |

 

**TREASURYFACILITIES**

 

In addition to the above facilities, the Bank’sTreasury Operations have been allocated the necessary authority to quote forthe Company’s risk management requirements. Such facilities will remain uncommitted.

 

**SECURITY**

 

The documentation required by the Bank as security forthe Facilities is set out in the**Schedule **andmust be provided in a form and substance acceptable to the Bank.

 

**REVIEWDATE**

 

All Facilities are subject to annual review by 31stJuly 2005.  If the Bank decides toextend one or all of the Facilities, it may do so on whatever terms it thinksfit, in its absolute discretion after consulting with the Company and willnotify the Company accordingly.

 

**GENERAL**

 

In addition to the normal banking terms and conditionsapplicable to the Facilities, the special terms and conditions set out in thefollowing annexures will also apply:

 

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| ** ** | **Annexure** | ** ** | **Title**                                                        | ** ** |
|------------|--------------|------------|------------------------------------------------------------------|------------|
|       |         |       |                                                             |       |
|       | A            |       | General  Terms and Conditions                                    |       |
|       | B            |       | Financial  Undertakings                                          |       |
|       | C            |       | Conditions  Precedent                                            |       |
|       | D            |       | Letters  of Credit and Guarantees by Bank - Terms and Conditions |       |
|       | E            |       | Schedule                                                         |       |
|       | F            |       | Debtor  Finance Facility Agreement                               |       |

 

**VARIATION OF INTEREST RATES, MARGINS AND FEES**

 

Unless specifically stated, interest rates, marginsand fees may be varied by the Bank in the light of conditions, prevailing fromtime to time.  Although we will endeavourto notify the Company of any change to fees as it occurs, if the Bank does notdo so for any reason, this will not prevent the charging of the new or adjustedfee.

 

**ACCEPTANCE**

 

This offer remains available for acceptance until 31stJuly 2004 after which it will at the Bank’s option lapse.

 

Acceptance of these Facilities and all the terms andconditions of this letter of offer is required by way of a certified extract ofresolution of directors of the Company.

 

**THE CODE OF BANKING PRACTICE**

 

The Bank has adopted the Code of Banking Practice andrelevant provisions of the Code apply to this Letter of Offer if the Borroweris a small business customer (as defined by the Code).  The Borrower can obtain from the Bank uponrequest:

 

(a)                        information on the Bank’s current interest rates and standard feesand charges relating to the Facilities as described in this Letter of Offer ifany;

 

(b)                       general descriptive information concerning the Bank’s bankingservices including:

 

(i)                           for accounts with cheque access, general descriptive informationabout cheques;

 

(ii)                        account opening procedures;

 

(iii)                     the Bank’s obligations regarding the confidentiality of theBorrower’s information;

 

(iv)                    complaint handling procedures;

 

(v)                       bank cheques;

 

(vi)                    the advisability of the Borrower informing the Bank promptly whenthe Borrower is in financial difficulty;

 

(vii)                 theadvisability of the Borrower reading the terms and conditions applying to eachbanking service the Bank provides to the Borrower;

 

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(c)                        general descriptive information above:

 

(i)                           the identification requirements of the Financial TransactionsReports Act 1988;

 

(ii)                        the options available to the Borrower under the tax file numberlegislation; and

 

(d)                       a copy of the Code of Banking Practice.

 

**GENERAL**

 

Please note that the terms, conditions and pricingdetailed in this letter have been provided for the sole use of the Borrower onthe understanding that none of the material will be divulged to outside partieswithout the prior written consent of the Bank.

 

We trust thatthe Facilities meet Borrower’s current requirements.  If any matter needs clarification, please donot hesitate to contact me or Sam Mandoukos.

 
| Yours  faithfully            |
|------------------------------|
|                         |
| ** **                   |
| **Graeme Johnson**           |
| Senior  Relationship Manager |

 

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**ANNEXURE A**

 

**GENERALTERMS AND CONDITIONS**

 
|   | **CONTENTS** |                            |
|--------|--------------|---------------------------------|
|   |         |
|   | 1.           | REPRESENTATIONS  AND WARRANTIES |   |
|   | 2.           | GENERAL UNDERTAKINGS            |   |
|   | 3.           | ACCOUNTS                        |   |
|   | 4.           | EVENTS OF DEFAULT               |   |
|   | 5.           | POTENTIAL  EVENTS OF DEFAULT    |   |
|   | 6.           | OPEN TREASURY  TRANSACTIONS     |   |
|   | 7.           | NON-WAIVER                      |   |
|   | 8.           | CLASS ORDER                     |   |
|   | 9.           | COSTS AND EXPENSES              |   |
|   | 10.          | PAYMENTS AND TAXES              |   |
|   | 11.          | LATE PAYMENTS                   |   |
|   | 12.          | ILLEGALITY                      |   |
|   | 13.          | CHANGE IN  CIRCUMSTANCE         |   |
|   | 14.          | TRUSTS                          |   |
|   | 15.          | SET-OFF                         |   |
|   | 16.          | CHANGE OF OWNERSHIP             |   |
|   | 17.          | APPOINTMENT OF  CONSULTANTS     |   |
|   | 18.          | BREAK COSTS                     |   |
|   | 19.          | HOLDING OVER                    |   |
|   | 20.          | ASSIGNMENT                      |   |
|   | 21.          | CONFIDENTIALITY                 |   |
|   | 22.          | INCONSISTENCY                   |   |
|   | 23.          | GOVERNING  LAW AND JURISDICTION |   |
|   | 24.          | DEFINITIONS                     |   |

 

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**1.****                           REPRESENTATIONS AND WARRANTIES**

 

The Borrower represents and warrants to the Bank that as at the date ofthis letter of offer and at all times thereafter:

 

(a)                        (**incorporation**)  It is duly incorporated and validly existingunder the laws of its place of incorporation;

 

(b)                       (**power**)  It has full power, authority and legal rightto carry on its business as presently conducted;

 

(c)                        (**information is accurate**)  All financial accounts, reports and factualinformation furnished to the Bank at any time are true and accurate and notmisleading in any material respect, and no material change has taken place inrespect to any of them since the date they were presented to the Bank;

 

(d)                       (**no default**)   It is not in material default of any law orany agreement, security or instrument with the Bank or any other financialinstitution, and it is not in default in respect of any material monetaryobligation contracted by or imposed upon it;

 

(e)                        (**no litigation**)   No litigation, arbitration or administrativeproceedings are current or pending or, to its knowledge, threatened against it;

 

(f)                          (**solvency**)   It is solvent;

 

(g)                       (**no potential event of default**)  No Potential Event of Default has occurredand is continuing;

 

(h)                       (**no undisclosed trusts**)  Except as disclosed to and agreed to by theBank in writing, it is not trustee of any trust;

 

(i)                           (**insurance**)  It hastaken out and kept in full force and effect insurance over all of its physicalassets and its premises for such amounts and against such risks as a reasonablyprudent person in the Borrower’s position would take out including, withoutlimitation, terrorism insurance.

 

The Borrower also gives the above representations and warranties inrespect of every guarantor and Security Provider.

 

These representations and warranties are deemed to be repeated withreference to the facts and circumstances then existing at each date ofutilisation of any financial accommodation, rollover of any bills of exchangeor notes, at the beginning of each new interest period and at the date ofexecution of each new document under which credit or financial accommodation isgranted by the Bank.

 

**2.****                           GENERAL UNDERTAKINGS**

 

The Borrower undertakes to the Bank that, except with the prior writtenconsent of the Bank:

 

(a)                        (**notify defaults**)  Itwill promptly advise the Bank of any Event of Default or potential Event ofDefault;

 

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(b)                       (**insurance**)  It willtake out and keep in full force and effect the insurance policies referred toin sub-paragraph 1(i) above, and further:

 

(i)                          provideevidence to the Bank of the currency of all insurances on each annual review,or upon request by the Bank, whichever is the earlier, and promptly comply withany request to take out further insurance cover as the Bank may reasonablyrequire to supplement the existing insurance policies of the Borrower; and

 

(ii)                       not do or omitto do, or suffer or permit to be done or not done, anything which maymaterially prejudice any insurance policy; and

 

(iii)                    not vary, rescind,terminate or cancel any insurance policy without the written consent of theBank;

 

(c)                        (**comply with laws**)  Itwill comply with all applicable laws and pay all obligations that if unpaidmight result in a lien or claim against any of the Borrower’s assets;

 

(d)                       (**plant and machinery**) It will maintain its plant and machinery in a state of good repair, fairwear and tear excepted;

 

(e)                        (**other financial accommodation**)  It will not raise any financial accommodationfrom any other party, or give any security in relation to it;

 

(f)                          (**disposal of assets**) it will not dispose of any assets having an aggregate value greater than$100,000 other than in its usual and ordinary course of business;

 

(g)                       (**continue to stay in business**)  It will not engage in any other businessother than that in which it is presently operating;

 

(h)                     (**no merger or acquisition**)  It will not merge with or acquire anothercompany or entity;

 

(i)                         (**no disposal of subsidiaries**)  It will not dispose of any of itssubsidiaries; and

 

(j)                         (**not give security**)  It will not give any security over itsassets.

 

**3.****                           ACCOUNTS**

 

The Borrower will prepare its financial accounts in accordance withgenerally accepted Accounting Standards

 

The Borrower will deliver to the Bank:

 

(a)                        (**annual accounts**) within four months after the close of each financial year a copy of the annualreport of the Borrower, and an audited consolidated balance sheet andconsolidated profit and loss account of the Borrower for that financial year;

 

(b)                       (**quarterly management accounts**) within 30 days after theclose of each financial quarter, a copy of the unaudited quarterly balancesheet and profit and loss account of the Borrower;

 

(c)                        (**Budgets**) by 30th November each year theborrower is to provide a copy of the annual budget projected monthly for theensuing 12 months with assumptions attached; and

 

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(d)                       (**other information**) such other financial information as theBank may reasonably require, within fourteen days after request.

 

**4.****                           EVENTS OF DEFAULT**

 

If an Event of Default occurs, the Borrower will immediately notify theBank.  The notice will contain fulldetails of the Event of Default, and such further information as the Bank mayrequire from the Borrower regarding the Event of Default.

 

If an Event of Default occurs, the Bank may, by written notice to theBorrower, terminate the Facilities and demand repayment of the Money Owing.

 

**Eventof Default**means:

 

(a)                        (**payment default**) the Borrower fails to pay to the Bank any MoneyOwing from time to time due and payable to the Bank;

 

(b)                       (**other defaults**) the Borrower fails to perform and observeany other terms or conditions of the Documents;

 

(c)                        (**representations and warranties**) a representation or warrantygiven to the Bank in a Document or otherwise is incorrect or false in amaterial respect when made or deemed to be repeated;

 

(d)                       (**other financial accommodation**) the Borrower fails to dulyperform or observe any of the terms and conditions of any other financialaccommodation (whether provided by the Bank or any other person);

 

(e)                        (**orders and judgments**) an order for payment is made orjudgment is entered or signed against the Borrower and is not satisfied within7 days;

 

(f)                          (**receivers**) a receiver, manager, receiver and manager,liquidator, provisional liquidator or administrator is appointed in respect ofthe Borrower for the whole or any part of its undertaking, property or assets;

 

(g)                       (**investigators**) a person is appointed under legislation toinvestigate or manage any part of the affairs of the Borrower;

 

(h)                       (**winding up**) a ground for winding up or bankruptcy of theBorrower arises;

 

(i)                           (**stop payment**) the Borrower or any Security Provider stopspayment generally or ceases or threatens to cease to carry on its business or thematerial part of its business;

 

(j)                           (**meeting of creditors**) the Borrower convenes a meeting of itscreditors or proposes or enters into any arrangement or composition for thebenefit of its creditors;

 

(k)                        (**winding up resolution**) a resolution is passed for thewinding up of the Borrower, other than for the purpose of a reconstruction oramalgamation previously approved in writing by the Bank;

 

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(l)                           (**material adverse change**) a change occurs in the financialcondition or in the whole or a major part of the operations of the Borrower,which has had or could reasonably be expected to have a materially adverseeffect on the ability of the Borrower to perform its obligations to the Bank;

 

(m)                     (**other security providers**) any of the above events occurs inrelation to any person or Borrower  whois a guarantor, or Security Provider in connection with the Facilities;

 

(n)                       (**loss of security**) anything occurs which in the Bank’sreasonable opinion terminates or reduces the enforceability of any part of theSecurity Documents.

 

**5.****                           POTENTIAL EVENT OF DEFAULT**

 

If aPotential Event of Default occurs, the Borrower will keep the Bank fullyinformed of all developments in resolving the matter.

 

If a Potential Event of Default occurs, the Bank retains the right toreview the availability of the Facilities and to notify the Borrower of theoutcome of the review.

 

**6.****                           OPEN TREASURY TRANSACTIONS**

 

If the Bank terminate the Facilities following the occurrence of anEvent of Default, and if at that time there are any Treasury Transactions inexistence between the Bank and the Borrower (**OpenPositions**) then:

 

(a)                        the Bank may close out the Open Positions, by entering into oppositepositions for the balance of the unexpired term, or by such other means as maybe usual in the relevant market.  Anysuch close out shall be at market rates prevailing at the time;

 

(b)                       any costs incurred by the Bank in closing out Open Positions under **paragraph (a)** will be paid by the Borrower to the Bank upondemand by the Bank.  Any gain derivedfrom the closing out of the Open Positions will be credited to the Borrower andset off against the Money Owing;

 

(c)                        the Bank will give to the Company reasonable particulars of themanner of close out of the Open Positions, and the basis of calculation of anyamounts payable by or to the Borrower arising from that close out.

 

**7.****                           NON-WAIVER**

 

The liabilities of the Borrower and the rights of the Bank are notaffected by anything which might otherwise have that effect at law or in equityincluding, without limitation, one or more of the following (whether occurringwith or without the consent of a person):

 

(a)                        anyinaccuracy, insufficiency or forgery of or in any certificate or otherinstrument which purports to be made, issued or delivered under the Documentsor under any letter of credit, Bank guarantee or other instrument issued underthe Documents; or

 

(b)                       the Bank oranother person granting time or other indulgence (with or without theimposition of an additional burden) to, compounding or compromising with orwholly or partially releasing the Borrower or another person in any way; or

 

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(c)                        laches,acquiescence, delay, acts, omissions or mistakes on the part of the Bank oranother person; or

 

(d)                       any variationor novation of a right of the Bank or another person, or alteration of adocument, in respect of the Borrower or another person including, withoutlimitation, an increase in the maximum liability of or other variation inconnection with a letter of credit or guarantee; or

 

(e)                        the invalidityor unenforceability of an obligation or liability of a person other than theBorrower; or

 

(f)                          invalidityor irregularity in the execution of this agreement by the Borrower or anydeficiency in the powers of the Borrower to enter into or observe itsobligations under this letter of offer.

 

**8.****                           CLASS ORDER**

 

If the Borrower applies for a Class Order, it will notify the Bankimmediately in writing.  The Bank mayreview (and if considered appropriate, terminate) all or any of the Facilitiesmade available to the Borrower.

 

In this paragraph a “Class Order” means an order made by the AustralianSecurities and Investments Commission pursuant to Part 2M.6 of the CorporationsAct.

 

**9.****                           COSTS AND EXPENSES**

 

The Borrower will pay to the Bank on demand all Taxes, costs andexpenses of any nature incurred by the Bank in relation to the Documents andthe Facilities, whether payable directly or indirectly.  These amounts are payable regardless of whetherthe Facilities are ever drawn down.

 

The Borrower will pay to the Bank all legal costs incurred in relationto the preparation, negotiation, execution, registration, administration andenforcement of the Documents (including the Bank’s solicitors’ fees on asolicitor and own client basis).

 

**10.****                    PAYMENTS AND TAXES**

 

All payments due by the Borrower to the Bank must be made on the duedate in immediately available funds.

 

If payment is due on a day on which the Bank is not open for businessin the relevant State, then payment must be made on the next business day inthat State.

 

Notwithstanding, and without limitation to, any other provision of thisletter of offer:

 

**(a)**                        if GST is imposed on any supply made bythe Bank under or in connection with this letter of offer or the facilitiesoffered in this letter of offer, where any amount or consideration (“consideration”)payable or to be provided by or on behalf of the Borrower under or inconnection with this letter of offer or the facilities offered in this letterof offer in relation to that supply is exclusive of GST (“GST-exclusive consideration”), the Bank may in addition to that GST-exclusive consideration,recover from the Borrower, or from a person acting on its behalf, an additionalamount on account of GST, such additional

** **

**11**

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** **

**amount to be calculated by multiplying theGST-exclusive consideration for the relevant supply by the prevailing GST rate.This sub-paragraph (a) does not apply to a supply for which the considerationis inclusive of GST; or**

** **

(b)                       where the Bankmakes a supply under or in connection with this letter of offer or thefacilities offered in this letter of offer which is not a taxable supply andthe Bank is not entitled to an input tax credit (whether in whole or in part)in respect of the amount of any GST charged to or recovered from the Bank byany person, or payable by the Bank, or in respect of any amount which isrecovered from the Bank by way of reimbursement of GST referable directly orindirectly to that supply, the Bank shall be entitled to increase any amount orconsideration payable by the Borrower on account of such input tax and recoverfrom the Borrower the amount of any such increase.

 

Anyadditional amount on account of GST, or on account of an amount for which theBank is not entitled to an input tax credit, recoverable from the Borrowerpursuant to sub-paragraph (a) or sub-paragraph (b) of this paragraph shall becalculated without any deduction or set-off of any other amount and is payableby the Borrower upon demand by the Bank whether such demand is by means of aninvoice or otherwise.

 

Inrelation to any consideration payable or to be provided under or in connectionwith this letter of offer or the facilities offered in this letter of offerthat is inclusive of GST (“**the existing GST inclusiveconsideration**”) in the event of an increase in the GST rate, theBank may, subject to issuing a Tax Invoice or Adjustment Note, as appropriate,recover from the Borrower an additional amount on account of the increase inthe GST rate. This additional amount is to be determined by converting theexisting GST inclusive consideration to a GST exclusive amount (“**value**”) and multiplying it by the new prevailing GST rateand by subtracting from that result the previous GST component.

 

For thepurposes of the above paragraph:

 

(i)                           the existing GST inclusive consideration is to be converted to thevalue by using the GST rate immediately prior to the new prevailing GST rate;and

 

(ii)                        the previousGST component is equal to the difference between the existing GST inclusiveconsideration and the value.

 

**11.****                    LATE PAYMENTS**

 

If any amount is not paid to the Bank when due, it will accrue interestat the Default Rate until it is paid. That interest will be calculated on daily balances and added to the debtmonthly if not paid.  This paragraph doesnot relieve the Borrower of its obligation to make payments when due.

 

All payments must be made without set-off or counter-claim, and be freeand clear of any withholding or deduction for taxes, levies, imposts orgovernment charges of any kind unless prohibited by law.  If any deduction is required by Law, theBorrower will make the deduction, pay the Tax, and pay to the Bank furtheramount(s) sufficient to ensure that the Bank receives the same net amount as itwould have received if no deduction had been made.

 

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**12.****                    ILLEGALITY**

 

If any change in Law makes it unlawful or impossible for the Bank tomaintain or give effect to its obligations under the Documents, then the Bankshall promptly notify the Borrower.

 

The Bank and the Borrower will negotiate in good faith to restructureeach affected Facility in a manner which resolves the problem.  If no agreement is reached within 30 (thirty)days after the Bank notified the Borrower, then the Borrower will repay to theBank on demand so much of the Money Owing as relates to the affected Facility.

 

**13.****                    CHANGE IN CIRCUMSTANCE**

 

Thisparagraph applies if any order of any court or any change in Law, or in theofficial interpretation or application of Law by any government authority:

 

(a)                        subjects theBank to any Taxes or duties with respect to the Facilities or any part of them,or changes the basis  of taxation of theBank for payment under the Documents (except for taxes on the overall netincome of the Bank); or

 

(b)                       imposes,modifies or deems applicable any reserve, capital, adequacy or liquidityadequacy requirements against any asset of, deposit with or for the account ofor loans by the Bank; or

 

(c)                        imposes on theBank any other condition with respect to the Documents or the obligations ofthe Bank under them, or if the Bank complies with any request from anyapplicable fiscal or monetary authority (whether or not having the force oflaw);

 

If theresult of the above is to increase the cost to the Bank of making available ormaintaining a Facility, or to reduce the amount receivable in respect of aFacility, or reduce any other amount due to the Bank in connection with aFacility by an amount which the Bank considers material, then:

 

I.                               theBank will use its best efforts to notify the Borrower of that event; and

 

II.                           theBorrower and the Bank will negotiate in good faith to restructure each affectedFacility in a manner which resolves the problem; and

 

III.                       if no agreementis reached within 30 days after the Bank notified the Borrower, the Borrowerwill pay to the Bank on demand, as additional interest or charges, an amountwhich will compensate the Bank for the additional costs, calculated from thedate of that notification.

 

**14.****                    TRUSTS**

 

The Borrower warrants to the Bank that it is not thetrustee of any trust.

 

**15.****                    SET-OFF**

 

If an Event of Default occurs, the Bank may at any time without noticeto the Borrower combine, consolidate or merge all or any of the Borrower’saccounts, and may set off the whole or any part of the Money Owing against anycredit balance in those accounts.

 

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For that purpose, the Bank may redeem and/or appropriate all or anypart of any account, deposit or other arrangement between the Bank and theBorrower under which the Bank may be indebted to the Borrower, even if thebalance on any such account and the Money Owing are not expressed in the samecurrencies.  The Bank may make anycurrency conversion it considers necessary or desirable for this purpose.

 

**16.****                    CHANGE OF OWNERSHIP**

 

If the Borrower is listed on a stock exchange, the Borrower willpromptly notify the Bank if a majority of the shares in the Borrower becomesheld by a person who did not hold a majority of the shares as at the date ofthe letter of offer.  For this purpose,associates shall be treated as the one person.

 

In the case of a company which is not listed on a stock exchange, notransfer of shares (or issue of shares) in that company may be made, withoutthe Bank’s prior written consent.  Thatconsent will not apply to a transfer or issue to any company which is a relatedcorporation of the Company.

 

The Bank may review (and if considered appropriate terminate) allFacilities made available to the Borrower upon the occurrence of a change inshareholdings or an issue of shares referred to in this paragraph.

 

**17.****                    APPOINTMENT OF CONSULTANTS**

 

The Bank may at any time appoint accounting, financial management andother consultants to examine the affairs of the Borrower and to makerecommendations relating to the manner in which the Borrower carries on itsbusiness.  The Borrower will provide allassistance considered necessary or desirable by the consultant to enable theconsultant to conduct a proper examination of the affairs of the Borrower.  This includes, without limitation, making theBorrower’s financial records available to the Consultant.  The Borrower shall pay the fees of theConsultant.

 

**18.****                    BREAK COSTS**

 

The Borrower indemnifies the Bank against any loss, cost, charge, lossof profit or expense incurred by the Bank in connection with:

 

(a)                        the Borrowermaking a payment under any Document on a date which is not expressly contemplatedin the Document, whether that payment is made as a result of demand by the Bankfollowing an Event of Default or any other reason; and

 

(b)                       any financialaccommodation provided by the Bank at a fixed rate being repaid in whole or inpart during the period to which that fixed rate applies.

 

**19.****                    HOLDING OVER**

 

If the Bank continues to make a Facility available to the Borrowerafter its Expiry Date, and this letter of offer has not been extended, amendedor replaced, then the terms of this letter of offer will continue to apply tothe Facility unless the Bank otherwise notifies the Borrower.  The previous sentence is not a waiver of anyEvent of Default, or a waiver of any of the Bank’s rights under this letter ofoffer.

 

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**20.****                    ASSIGNMENT**

 

The Bank may assign, novate, sub-participate or sell down by whateverform, all its rights under the Documents with the prior consent of the**Borrower, which consent will not be unreasonably withheldor delayed.

 

The Borrower may not assign its rights or novate its obligation underthe Documents.

 

**21.****                    CONFIDENTIALITY**

 

The Bank and the Borrower will keep confidential the terms of theFacilities, the Documents, and any information which either of them may provideto the other.  This obligation does notprevent disclosure:

 

(a)                        if allowed orrequired by Law, or required by any stock exchange;

 

(b)                       in connectionwith legal proceedings relating to the Documents;

 

(c)                        if theinformation is generally and publicly available;

 

(d)                       to a subsidiaryof the Bank, in which case this **paragraph 21**will apply to the subsidiary.

 

**22.****                    INCONSISTENCY**

 

                                      Ifany provision of this letter of offer is inconsistent with any provision of theDocuments, this letter of offer will prevail.

 

**23.****                    GOVERNING LAW AND JURISDICTION**

 

                                      Thisletter of offer is governed by the Laws of New South Wales.  Each party submits to the jurisdiction of theLaws of that state, including appeal courts.

 

**24.****                    DEFINITIONS**

 

The following terms shall have the following meanings in this letter ofoffer:

 

**AccountingStandards** means the accounting standardsprescribed under the Corporations Act, Chapter 2M to the CorporationsRegulations and, where not inconsistent with those accounting standards andschedule, the accounting standards adopted from time to time by the majoraccounting bodies in Australia in respect of the preparation of accounts andfinancial statements.

 

**AuthorisedOfficer**means:

 

(a)                        in the case ofthe Bank, a director, secretary or an officer whose title contains the word **manager** or a person performing the functions of any of them;and

 

(b)                       in the case ofthe Borrower or a Security Provider, a person appointed by the Borrower or thatSecurity Provider to act as an Authorised Officer under the Documents to whichit is a party and whose specimen signature as Authorised Officer has beenprovided to the Bank.

 

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**BaseLending Rate** means the rate described assuch or any rate replacing that rate as published from time to time by the Bankin the financial press and includes any rate adopted by the Bank to replace it.

 

**Bill** has the same meaning as in the Bills of Exchange Act 1909 (Cwlth)and a reference to the drawing or acceptance or endorsement of, or otherdealing with, a Bill is to be interpreted in accordance with that act.

 

**BusinessDay** means a day (not being a Saturday or aSunday) on which the Bank is open for general banking business in Sydney.

 

**DefaultRate** means 4.50% per annum above the Bank’sBase Lending Rate from time to time.

 

**Documents** means this letter of offer, the Security Documents and eachsecurity document (however described) including every guarantee, mortgage,charge, debenture, set-off agreement and other instrument, notice, form,agreement or encumbrance from time to time held by the Bank from the Borrowerand any Security Provider.

 

**Dollars**,**$ or A$** means the lawful currencyof Australia.

 

**Law** means any law or regulation (including any policy, directive orguidelines, whether or not having the force of law, but compliance with whichis in accordance with the practice of responsible bankers).

 

**MoneyOwing** means all money owing to the Bank bythe Borrower on any account, and includes without limitation:

 

(a)                        all money lentor advanced by the Bank to the Borrower, in any currency, and which have notbeen repaid to the Bank;

 

(b)                       all money owingby the Borrower to the Bank in respect of any bills accepted and/or endorsedand/or discounted facility made available by the Bank, including the face valueof all bills of exchange which are from time to time outstanding (although thematurity dates of such outstanding bills has not occurred);

 

(c)                        the aggregateamount of the Bank’s liability under any documentary letter of credit, standbyletter of credit, performance bond or bank guarantee issued by the Bank onbehalf of or at the request of the Borrower, although no payment under it shallhave been made or demanded;

 

(d)                       the aggregateamount of money unpaid to the Bank in respect of any Treasury Transaction, inany currency;

 

(e)                        all interest,fees, charges and other money which the Borrower is required to pay to Bankunder any Document, and which are from time to time owing or unpaid to theBank; and

 

(f)                          Break Costsbeing any loss, cost, charge or expense incurred pursuant to paragraph 18 ofthis Annexure.

 

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The term includes, without limitation, any money and amounts owing bythe Borrower to the Bank which:

 

(a)                        are presentlyowing and payable, are owing but not presently payable or are owing upon acontingency;

 

(b)                       may becomeowing or remain unpaid or for which the Bank may become liable by reason whollyor partly of past events or by reason of anything done or omitted by the Bankor the Borrower;

 

(c)                        may reasonably,foreseeably become owing or remain unpaid on any account or in any mannerwhatsoever by reason of the relation of bank and customer or by operation oflaw or equity or otherwise by reason of anything done by the Bank with theconsent or at the express or implied request of the Borrower.

 

**PotentialEvent of Default** means an event omission orcircumstance which with the giving of notice and/or lapse of time and/or othercondition would become an Event of Default.

 

**Schedule **means the schedule to this letter of offer set out as **Annexure E**.

 

**SecurityDocuments** means the various documentsdescribed in the **Schedule **to this letter ofoffer.

 

**SecurityProvider** means each person who is party toany of the Security Documents****but excludingthe Bank and the Company.

 

**Taxes** or **Tax** means any tax, levy, impost,deduction, charge, withholding and duty imposed by any authority and includeswithout limitation any withholding tax, financial institutions duty, stampduty, transaction duty and other government charges or any kind (includingpenalties) payable in respect of the Documents, or any payments, ortransactions under them.  It does notinclude income tax on the Bank’s own income.

 

**TreasuryTransaction**includes, without limitation,any interest rate or currency forward rate agreement, swap, financial option,futures contract, currency exchange agreement, reciprocal purchase agreement,swaption, floor, collar, cap and any similar type of interest rate or currencyrisk management or forward purchase or sale agreement, however described.

 

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**ANNEXURE B**

 

**FINANCIALUNDERTAKINGS**

 

**1.****                           FINANCIAL RATIOS**

 

The Borrower undertakes to the Bank to comply with the followingfinancial undertakings unless the Bank otherwise consents in writing:

 

(a)                        InterestCover Ratio: earnings before interest and tax(EBIT) must not at any time fall below a figure of 2 times the total amount ofinterest payable by the Borrower.

 

**2.****                           **Theratios in **paragraph 1** will be determined on anannualised basis, based on the most recent accounts of the Borrower availableat that time.

 

**3.****                           TERMS USED**

 

In this Annexure, the terms Total Liabilities, Contingent Liabilities,Total Tangible Assets, Total Current Assets, Total Current Liabilities,Earnings before Interest, Tax and Finance Lease Repayments, Gross InterestExpense plus Finance Lease Repayments and Net Profit after Tax and any otheraccounting or financial terminology will be interpreted in accordance with theAccounting Standards in respect of the accounts of the Borrower on aconsolidated basis.

 

**4.****                           DEPARTURES FROM ACCOUNTING STANDARDS**

 

If the Borrower wishes to depart from the Accounting Standards inpreparing its accounts, the parties will consult with each other on the changes(if any) required to the undertakings in **paragraph 1** toensure that they remain consistent.

 

**5.****                           COMPLIANCE CERTIFICATE**

 

The Borrower will also deliver to the Bank on a calendar quarterlybasis a certificate as to compliance, with Financial Undertakings, givingreasonable particulars of any calculations. The certificate will be signed by a director or chief financial officerof the Borrower.

 

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**ANNEXURE C**

 

**CONDITIONSPRECEDENT**

 

The Bank isnot obliged to make the Facilities available to the Borrower unless the Bankhas received the following in form and substance acceptable to the Bank:

 

(a)                       (**board minutes**) a certified copyof:

 

(i)                           an extractof the minutes of a meeting of the board of directors of the Borrower whichevidences the resolutions authorising the acceptance and observance ofobligations under (and acknowledgment that the Borrower will benefit from) thisletter of offer and the appointment of Authorised Officers of the Borrower; and

 

(ii)                        an extract ofthe minutes of a meeting of the board of directors of each Security Providerwhich evidences the resolution authorising the appointment of AuthorisedOfficers of the Security Provider;

 

(b)                       (**other authorisations**) a certifiedcopy of each authorisation necessary to enter into, observe obligations underand enforce the Documents;

 

(c)                        (**power of attorney**) the original ofeach power of attorney under which any person signs and delivers a Document forthe Borrower or any Security Provider and, if required by the Bank, evidence ofits stamping and registration;

 

(d)                       (**specimen signatures**) a certifiedspecimen signature of each Authorised Officer of each Borrower and of everySecurity Provider;

 

(e)                        (**signed Documents**) each Documentsigned and delivered and, if required by the Bank, evidence of its stamping andregistration;

 

(f)                          (**solvency declaration**) a statutorydeclaration that each Borrower is solvent, signed by a director of theBorrower;

 

(g)                       (**securities**) the SecurityDocuments;

 

(h)                       (**no Events of Default**) evidencethat no Event of Default or event which with the giving of notice, lapse oftime or fulfilment of any conditions would be likely to become an Event ofDefault continues unremedied or would result from the provision of the proposeddrawing;

 

(i)                           (**other documents**) the Bank hasreceived the other approvals, opinions or documents which it has reasonablyrequested;

 

(j)                           (**establishment fee**) payment of theestablishment fee, if any and however described;

 

(k)                        (**other requirements**) such otherconditions precedent as the Bank may specify by notice to the Company;

 

(l)                           (**legal opinion**) if requested, alegal opinion from solicitors for the Bank, the Borrower and each SecurityProvider; and

 

(m)                     (**payment of costs**) evidence thatall legal and other costs and expenses (including stamp duty and registrationfees) incurred by the Bank in connection with the Facilities have been paid.

 

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**ANNEXURED**

 

**LETTERS OF CREDIT AND GUARANTEES BY BANK -TERMS**

 

References to **Borrower** in this Annexure are references to the company orcompanies specified as **Participating Companies**in respect of any Letters Of Credit or Guarantees By Bank Facility in theletter of offer.

 

**1.****                           REQUEST FOR ISSUE**

 

The Borrower may request the Bank to issue a letter of credit orguarantee by delivering to the Bank a properly signed request (in a formspecified by the Bank from time to time) stating:

 

(a)                        the amount;

 

(b)                       thebeneficiary;

 

(c)                        the contractin respect of which the letter of credit or guarantee is requested; and

 

(d)                       the expiry date,if applicable.

 

Each letter of credit and guarantee will be in the Bank’s usual form,unless otherwise agreed and the Borrower agrees to execute such additionaldocumentation or forms required by the Bank’s normal practice.

 

**2.****                           AUTHORITY TO MAKE PAYMENTS**

 

The Borrower irrevocably authorises the Bank to immediately pay anyamount for which a demand or request is made at any time under a letter ofcredit or guarantee without reference to or further authority from theBorrower.  The Bank need not investigateor enquire whether a claim or demand on the Bank has been properly made.  The Bank may meet any claim or demand on theBank notwithstanding that the Borrower may dispute the validity of the claim ordemand.

 

**3.****                           BORROWER’S UNDERTAKING TO REIMBURSE**

 

The Borrower agrees to pay to the Bank on demand an amount equal toeach amount demanded from or paid by the Bank under any letter of credit orguarantee together with any incidental costs or expenses.

 

**4.****                           INDEMNITY BY THE BORROWER**

 

As a separate obligation, the Borrower indemnifies the Bank against allactions, proceedings, claims and demands brought or made against the Bank andagainst all losses, costs, charges, damages and expenses which the Bank incursor sustains or for which the Bank becomes liable, directly or indirectly,because of the issue of any letter of credit or guarantee.

 

**5.****                           PRESERVATION OF BORROWER’S LIABILITY**

 

The liabilities of the Borrower and the rights of the Bank under this **Annexure D** are not affected by anything which mightotherwise have that effect at law or in equity including,

 

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without limitation, one or more of the following (whether occurringwith or without the consent of a person):

 

(a)                        anyinaccuracy, insufficiency or forgery or in any certificate or other instrumentwhich purports to be made, issued or delivered under this letter of offer orunder any letter of credit or guarantee; or

 

(b)                       the Bank oranother person granting time or other indulgence (with or without the impositionof an additional burden) to, compounding or compromising with or wholly orpartially releasing the Borrower or another person in any way; or

 

(c)                        laches,acquiescence, delay, acts, omissions or mistakes on the part of the Bank oranother person; or

 

(d)                       any variationor novation of a right of the Bank or another person, or alteration of adocument, in respect of the Borrower or another person including, withoutlimitation, an increase in the maximum liability of or other variation inconnection with a letter of credit or guarantee; or

 

(e)                        the invalidityor unenforceability of an obligation or liability of a person other than theBorrower; or

 

(f)                          invalidityor irregularity in the execution of this letter of offer by the Borrower or anydeficiency in the powers of the Borrower to enter into or observe itsobligations under this letter of offer.

 

**6.****                           LATE PAYMENTS**

 

If a drawing is made under a letter of credit or guarantee and is notpromptly reimbursed by the Borrower to the Bank, an interest rate of 4.50% perannum over the Bank’s Base Rate shall apply to the amount of the drawing.  That amount together with interest shall bedebited to any account in the name of the Borrower.

 

**7.****                           INSURANCE UNDERTAKINGS**

 

The Borrower undertakes to:

 

(a)                        insure goods relating to each letter of credit to the Bank’ssatisfaction; and

 

(b)                       deliver to the Bank a copy of any insurance policy or certificaterelating to those goods when received or at a time agreed to by the Bank.

 

**8.****                           UNIFORM CUSTOMS AND PRACTICE**

 

Each documentary letter of credit will be subject to the terms of theUniform Customs and Practice for Documentary Letters of Credit (1993 Revision)International Chamber of Commerce Publication No. 500, or any subsequentrevision of it and otherwise must be in a form satisfactory to the Bank.

 

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**ANNEXUREE**

 

**SCHEDULE**

 

**GROUPMEMBERS:**

 
| **Company Name**  | ** ** | **ABN**         | ** ** | **Registered office**                | ** ** |
|-------------------|------------|-----------------|------------|--------------------------------------|------------|
| Channell  Pty Ltd |       | 29  002 735 622 |       | 5/391  Park Rd Regents Park NSW 2143 |       |

 

**SECURITIES:**

 

The followingSecurity Documents must be held in a form and substance satisfactory to theBank prior to drawdown of the Facilities.

 

1.                             Firstranking registered charge given to the Bank by Channell Pty Ltd ABN 29 002 735622 over all its assets and undertakings.

 

2.                             Debtor Finance Agreement

 

3.                             MasterLease Agreement between the Bank and Channell Pty Ltd ABN 29 002 735 622

 

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