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CHANNEL FUNDING AGREEMENT

THIS CHANNEL FUNDING AGREEMENT (this “Agreement”) is dated [•] and


made between:

MAHINDRA AND MAHINDRA FINANCIAL SERVICES LIMITED, a company


incorporated and registered under Companies Act, 1956 (1 of 1956) and having its
registered office at Apollo Bunder, Gateway Building, Mumbai 400001 (hereinafter
referred to as the “Lender” which expression shall, unless it be repugnant to the
subject, meaning or context thereof, be deemed to mean and include its successors
and assigns).
AND
____________________________________________ a company Registered
under the Companies Act 1956 and having its registered office at
_______________________________(the “Borrower” which expression shall,
unless it be repugnant to the subject, meaning or context thereof, be deemed to
mean and include its successors and permitted assigns);

(The Borrower and the Lender are hereinafter collectively referred to as the
“Parties” and individually as the “Party”).

Whereas MMFSL is a leading Non-banking finance company engaged primarily in


the business of leasing and finance, hire purchase and advancement of loan;

AND WHEREAS the Borrower is an authorized dealer for vehicles manufactured by


__________;

AND WHEREAS it is the perception of the Borrower that provision of the loan facility
(“Said Facility”) by MMFSL to him would assist him in maintaining desired quantum
of inventory in his stock;

AND WHEREAS the Borrower therefore requested MMFSL to provide a sum specified
in the schedule I of this agreement for meeting his above stated requirements;

AND WHEREAS MMFSL has agreed to provide the Said Facility and the Borrower has
agreed to avail of the Said Facility;

NOW THIS AGREEMENT WITNESSES AS FOLLOWS:

1. The Borrower shall give a formal written request letter to MMFSL for availing
of the Said Facility from time to time stating his requirements and MMFSL
shall in turn release the payment as requested by the Borrower.

2. The Borrower shall provide the guarantee of its directors and/or ______ by
way of collateral security for the Said Facility and shall execute a Demand
Promissory Note as a collateral security against the repayment of the Said
Facility as availed by the Borrower.

3. The Borrower shall repay the amount so provided under the Said Facility as
per Schedule I to this agreement.

4. The Said Facility shall be secured by an Inventory of vehicles held in the


stock by the Borrower at any time and pledged by him in favor of MMFSL.
The said inventory shall be given by the Borrower to MMFSL and the total
value of the vehicles under the Said Facility as on ____ should not be less
than Rs. _____/-

5. The Borrower declares that that the said inventory is free from any charges
and undertakes to keep them free of any charge and/or encumbrances
during the time such inventory is pledged to MMFSL.

6. The Borrower shall pay the interest on the outstanding balance of the Said
Facility @ ___% P.A. from the date the Said Facility is availed by the
Borrower.

7. The Borrower shall repay the amount provided under the Said Facility as
availed from time to time as per the terms and conditions of MMFSL
prevailing at the time of sanction of the Said Facility.

8. During the currency of this agreement should the price of any of the vehicles
under the Said Facility be reduced either by way of excise duty or
government levies or by the Borrower themselves, the entire loss on account
of the dip in the prices shall be borne by the Borrower.

9. The Borrower hereby agrees to indemnify and to keep indemnified and save
harmless MMFSL from time to time and at all times hereafter against all
actions, suits, proceedings, claims, demands, duties, penalties, taxes and all
costs, losses and expenses that may be brought or made against or incurred
of suffered by MMFSL by reason of any false or misleading information or
documents given by the Borrower to MMFSL hereunder or any act of default,
non-observance or non-performance on the part of the Borrower in respect of
the Said Facility availed under this agreement.

10. Courts in Mumbai alone shall have exclusive jurisdiction to in all


disputes between the parties arising in respect of this agreement.

11.All the disputes, differences and/or claims arising out of these presents or in
any way touching or concerning the same or as to construction, meaning or
effect hereof or as to the rights and liabilities of the parties hereto shall be
settled by arbitration to be held in accordance with the provisions of the
Arbitration and Conciliation Act 1996 or any statutory amendments thereof
and shall be referred to the sole arbitrator to be nominated by MMFSL. In the
event of death, refusal, neglect, inability or incapability of a person so
appointed to act as an arbitrator, MMFSL may appoint a new arbitrator. The
arbitrator shall not be required to give any reasons for the award and the
award of the arbitrator shall be final and binding on all parties concerned.
The arbitration shall be held in Mumbai.

12. The Borrower accepts that the contents of this agreement has been
read out, explained and interpreted by MMFSL in language known to the
Borrower.

IN WITNESS WHEREOF the parties have hereunto set and subscribed their
respective hands to this writing on ___ day of the ___ month 2011.