MIRA INFORM REPORT

Report Date :

04.01.2011

IDENTIFICATION DETAILS

Name :	MOTIF INDIA INFOTECH PRIVATE LIMITED
Registered Office :	1/A, Wall Street – II, Near Gujatar College, Ellisbridge, Ahmedabad – 380006, Gujarat
Country :	India
Financials (as on) :	31.03.2010
Date of Incorporation :	27.03.2000
Com. Reg. No.:	04-37637
CIN No.: [Company Identification No.]	U72200GJ2000PTC037637
TAN No.: [Tax Deduction & Collection Account No.]	AHMM01149B
PAN No.: [Permanent Account No.]	AACCM1005A
Legal Form :	Private Limited Liability Company
Line of Business :	Service Provider for IT and IT Enabled Services.

RATING & COMMENTS

MIRA’s Rating :

Ba (49)

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 700000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear
Comments :	Subject is an established company having satisfactory track. Trade relations are reported as fair. Business is active. Payments are reported to be usually correct and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES:

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – April 1, 2010

Country Name	Previous Rating (31.12.2009)	Current Rating (01.04.2010)
India	A1	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INFORMATION PARTED BY

Name :	Ms. Mudra Shelat
Designation :	Accountant
Contact No.:	91-9925044642
Date :	03.01.2011

LOCATIONS

Registered Office :	1/A, Wall Street – II, Near Gujatar College, Ellisbridge, Ahmedabad – 380006, Gujarat, India
Tel. No.:	91-79-26569828
Mobile No.:	91-9925044642 (Ms. Mudra Shelat)
Fax No.:	91-79-26563825
E-Mail :	mudra.shelat@motifinc.com careers@motifinc.com kaushal.mehta@motifinc.com
Website :	http://www.motifinc.com
Area :	4000 sq.fts
Location :	Rented
Overseas Offices :	USA Motic Inc 292 Gibraltar Drive, Suite 102, Sunnyvale, CA - 94089 Tel No.: +1-408-7473445 Fax No.: +1-408-7473446 PHILIPPINES Motif Limited - Philippine Branch 4/F, E-Commerce Plaza, 1 Garden Road Eastwood, Cyberpark Bagumbayan, Quezon City - 1110, Manila Tel No.: 63-2-900-1158 Fax No.: 63-2-900-0865 AUSTRALIA Level 8, 100 Walker Street, North Sydney NSW - 2060 Tel No.: +61-2-8404-4188 Fax No.: +61-2-8404-4170

DIRECTORS

(AS ON 10.08.2009)

Name :	Mr. Kaushal Vinodbhai Mehta
Designation :	Chairman and Managing Director
Address :	Rasik Nivas, Near Bharti Society, Ellisbridge, Ahmedabad – 380006, Gujarat, India
Date of Birth/Age :	17.10.1965
Qualification :	M S from USA
Date of Appointment :	27.03.2000
Name :	Mrs. Parul Kaushalbhai Mehta
Designation :	Director
Address :	Rasik Nivas, Near Bharti Society, Ellisbridge, Ahmedabad – 380006, Gujarat, India
Date of Birth/Age :	05.01.1964
Date of Appointment :	27.03.2000

KEY EXECUTIVES

Name :	Ms. Mudra Shelat
Designation :	Accountant

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

(AS ON 10.08.2009)

Names of Shareholders	No. of Shares
Motif Inc, USA	6631205
Kaushal Vinodbhai Mehta	100
Parul Kaushalbhai Mehta	100
Total	6631405

(AS ON 10.08.2009)

Category	Percentage
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	100.00
Total	100.00

BUSINESS DETAILS

Line of Business :	Service Provider for IT and IT Enabled Services.
Exports :
Products :	IT and IT Enabled Services
Countries :	US
Terms :
Selling :	L/c, Cash
Purchasing :	Cash and Credit

GENERAL INFORMATION

Customers :

Corporates

No. of Employees :

600 (In office)

Bankers :

· Citi Bank

Branch C. G. Road, Ahmedabad, India

· ICICI Bank

JMC, Ahmedabad, India

Facilities :

Secured Loan	31.03.2010	31.03.2009
	(Rs. In Millions)
(Secured against Fixed Deposits with bank)
Bank of India	22.900	23.813
State Bank of India	18.208	21.484
Citibank NA	0.000	15.999
Total	41.108	61.296

Banking Relations :	--
Auditors :
Name :	Vivek S. Shah Chartered Accountant
Address :	4^th Floor, Shreeji House, B/H. M. J. Library, Ellisbridge, Ahmedabad - 380006, Gujarat, India
Name :	Ramanlal G Shah and Company Chartered Accountant
Address :	Shree Ji House, Behind M J Liabrary, Ellis Bridge, Ahmedabad - 380008
Tel. No.:	91-79-26578819/ 26575530
Fax No.:	91-79-26575401
E-Mail :	rgshahca@vsnl.net
Holding Company :	Motif Inc, USA

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
7000000	Equity Shares	Rs.10/- each	Rs.70.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
6631450	Equity Shares	Rs.10/- each	Rs.66.315 Millions

(Of the above 6631250 Shares of Rs.10/-each held by Motif Inc, USA)

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2010	31.03.2009	31.03.2008
SHAREHOLDERS FUNDS
1] Share Capital		66.315	66.315	66.314
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		104.488	109.669	66.318
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		170.803	175.984	132.632
LOAN FUNDS
1] Secured Loans		41.108	61.296	0.000
2] Unsecured Loans		0.000	0.000	0.000
TOTAL BORROWING		41.108	61.296	0.000
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		211.911	237.280	132.632
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		105.049	92.042	29.578
Capital work-in-progress		0.000	2.674	2.441
INVESTMENT		0.000	0.000	0.000
DEFERREX TAX ASSETS		10.242	3.708	1.096
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	0.000	0.000	0.000
	Sundry Debtors	58.338	97.493	42.598
	Cash & Bank Balances	96.724	105.557	77.979
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	46.414	34.882	15.413
Total Current Assets		201.476	237.932	135.990
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	63.102	75.002	17.693
	Other Current Liabilities	20.142	5.205	7.396
	Provisions	21.612	18.869	11.383
Total Current Liabilities		104.856	99.076	36.472
Net Current Assets		96.620	138.856	99.518
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		211.911	237.280	132.632

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2010	31.03.2009	31.03.2008
	SALES
		TOTAL INCOME	576.965	466.522	217.127
Less	EXPENSES
		TOTAL EXPENSES	535.756	396.915	195.445
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION		41.209	69.607	21.682
Less/ Add	DEPRECIATION/ AMORTISATION		50.502	25.674	8.384
	PROFIT BEFORE TAX		(9.293)	43.933	13.298
Less	TAX		(6.532)	2.753	3.292
	PROFIT AFTER TAX		(2.761)	41.180	10.006
	EARNINGS IN FOREIGN CURRENCY
		Export Earnings	567.771	459.252	208.781
	TOTAL EARNINGS		567.771	459.252	208.781
	IMPORTS
		Computer and Parts	3.497	6.248	7.422
	TOTAL IMPORTS		3.497	6.248	7.422
	Earnings Per Share (Rs.)		(0.42)	6.30	1.51

KEY RATIOS

PARTICULARS		31.03.2010	31.03.2009	31.03.2008
PAT / Total Income	(%)	(0.48)	8.82	4.60
Return on Total Assets (PBT/Total Assets}	(%)	(3.03)	13.31	8.03
Return on Investment (ROI) (PBT/Networth)		(0.05)	0.25	0.10
Debt Equity Ratio (Total Liability/Networth)		0.85	0.91	0.27
Current Ratio (Current Asset/Current Liability)		1.92	2.40	3.72

LOCAL AGENCY FURTHER INFORMATION

SUNDRY CREDITORS DETAILS:

Rs. In Millions

Particulars	31.03.2010	31.03.2009	31.03.2008
Sundry Creditors	63.102	75.002	17.693

NOTE:

Registered office of the company has been shifted from 502, Wall Street I Nrgujarat College, Ahmedabad – 380006, Gujarat, India to present address w.e.f. 209.09.2008.

OPERATIONS:

During the year, (year ended 31^st March 2010) the company’s total Income was Rs.576.965 Millions against the previous year income of Rs.466.522 Millions. The company’s income has increased by 23.67% in comparison to last year. The company has made a net loss of Rs.2.761 Millions against a net profit of Rs.41.181 Millions during the previous year, on account of higher depreciation of Rs.50.502 Millions on addition of significant amount of fixed assets in the company.

FUTURES PLANS OF THE COMPANY:

Management plans to continue providing high quality back office transaction processing and email response services to current client to retain and grow their business. In addition, Motif Inc, (Motif India)’s parent company plans to extend its US sales and support team to help market the services provided by Motif India. Motif India will reimburse Motif, Inc. all its cost associated to marketing its services plus a five percent margin should the group decide to extend in geography, Motif India will provide the necessary IT, trading Operations and quality functions to support this expansion. The company may evaluate owning its own premises should that make business sense at the time of consideration to avail of the special economic Zone (SEZ) benefits provided by the government of India.

CONTINGENT LIABILITY:

Particulars	Rs. In Millions 31.03.2010	Rs. In Millions 31.03.2009	Rs. In Millions 31.03.2008
Claim against the company not acknowledged as debt
Refer point (i)	0.283	0.282	0.282
Refer point (ii)	8.419	8.418	--
Refer point (iii)	20.113	0.000	--
Refer point (iv)	11.835	11.835

I. Vide its notice dated 17.03.2006 the ESIC had raised a demand of Rs.0.283 Millions for ESI to be collected on the entertainment allowance part of the salary with retrospective effect for the period 04/2001 to 09/2004. the company has challenged the petition before the ESI court at Ahmedabad and was granted a stay under the condition that the company will deposit 50% of the said amount, consequently the company had deposited Rs.0.137 million with the ESI court.

II. Vide its notice dated 29^th December 2008, the Accessing Officer has raised the demand based for Rs.8.418 Million for A. Y.2005-06 Based on the TPO order dated 21^st October 2009. The company has challenged the demand and field the appeals with commissioner appeals on 27^th January 2009. The appeal is pending before the commissioned of income tax.

III. Vide its Draft Assessment order dated 29^th December, 2009, the Assessing officer raised the demand for Rs.20.113 Millions for A. Y. 2006-07 based on TPO order received on 11^th April 2009. The company has filed and appeared for personal hearing before dispute resolution panel as provided section 144 C.

IV. The service tax department wide its show cause notice dated 9^th June 2009 has asked the company as to why not a Service Tax of Rs.11.835 Millions and penalty thereon under the provisions of service to be leaved and the services hires in the nature of “Business Auxiliary Services and Business Supports Services” pertaining to the financial years 2006-07 and 2007-08.

These said services were hired by the company from Motif Inc, USA under and agreement entered into with them on 1^st November 2006 and from specific Hub Corporation, Manila under the agreement entered into with them on 19^th August 2006.

The company has however, made in submission vide letter dated 12^th June 2009. The company has received order from commissioner on 15^th January, 2010. During the year been under audit, company has filed appeal before CESTAT on 13^th April 2010 and the hearing for the same is pending. The company has been advised thought a legal opinion to the effect that the said demand is not tenable under the exiting provisions of service tax laws and according to the status of the company and also under the provisions and status of the company as applicable to the periods for which the demand has been raised. Further the said option advises the company that it has a valid ground for non payment of the said demand and penalty thereon. Relying on said opinion, the management of the company has decided against payment and provision for the same and also continuing the same stand during the current financial year.

FIXED ASSETS:

· AC Machine

· Computer

· Furniture Fixtures

· Office Equipments

· Electrical Fittings

· Vehicles

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.67
UK Pound	1	Rs.69.45
Euro	1	Rs.59.37

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	5
PAID-UP CAPITAL	1~10	5
OPERATING SCALE	1~10	5
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	6
--PROFITABILIRY	1~10	6
--LIQUIDITY	1~10	6
--LEVERAGE	1~10	5
--RESERVES	1~10	6
--CREDIT LINES	1~10	5
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		49

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
-	NB	New Business	-

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.