MIRA INFORM REPORT

Report Date :

12.07.2012

IDENTIFICATION DETAILS

Name :	GUARDIAN LIFECARE PRIVATE LIMITED
Registered Office :	A-258, Okhla Industrial Area, Phase –I, New Delhi, Delhi – 110020,
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	28.07.2003
Com. Reg. No.:	55-121502
Capital Investment/ Paid-up Capital:	Rs.194.159 Millions
CIN No.: [Company Identification No.]	U51397DL2003PTC121502
TAN No.: [Tax Deduction & Collection Account No.]	DELG06382F
PAN No.: [Permanent Account No.]	AAB649903G
Legal Form :	Private Limited Liability Company
Line of Business :	Retail Chain of Health and wellness stores.
No. of Employees:	Not Available

RATING & COMMENTS

MIRA’s Rating :

Ca (12)

RATING		STATUS	PROPOSED CREDIT LINE
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

Status :	Moderate
Payment Behaviour :	Slow and Delayed
Litigation :	Clear
Comments :	Subject is established company having poor track. Financial position of the company is under severe pressure. There appears huge accumulated losses recorded by the company which tends to be increasing over years. Business is active. Payments are reported to slow and delayed. Initially, the company can be considered for business dealings only safe and secured 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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
India	A1	A1

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

LOCATIONS

Registered Office :	A-258, Okhla Industrial Area, Phase –I, New Delhi, Delhi – 110020, India
Tel. No.:	Not Available
Fax No.:	Not Available
E-Mail :	neeta.guglani@guardianlifecare.com
Web site:	www.gurdian.com
Head Office :	Guardian House, Plot No.55, Sector 37, Udyog Vihar, Phase VI, Gurgaon – 122001, Haryana, India
Tel. No.:	0124-4777300,4777301,40644061/62
Fax No.:	Not Available
E-Mail :	contact@gurdianlifecare.com
Web site:	www.gurdianlifecare.com

DIRECTORS

As on 30.11.2011

Name :

Mr. Ashutosh Garg

Designation :

Managing Director

Address :

LTH -3, PH – The Laburnum, Sushant Lok, Guragoan, Haryana -12202, India

Date of Birth/Age :

30.09.1956

Date of Appointment :

24.01.2005

Din No.:

00013624

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U72200DL2000PTC105891	Equation Enterprises Private Limited	Director	25/05/2000	25/05/2000	-	Active	NO
2	U72900DL2000PTC107191	TRICE INFOTECH PRIVATE LIMITED	Director	11/12/2000	11/12/2000	06/07/2009	Active	NO
3	U99999DL2001PTC110426	C MAIL INFOTECH PVT. LTD.	Director	17/04/2001	17/04/2001	06/07/2009	Active	NO
4	L32202RJ1992PLC017750	SHYAM TELECOM LIMITED	Director	01/08/2002	01/08/2002	31/07/2008	Active	NO
5	U93090DL1998NPL097629	YPO (DELHI CHAPTER) U/S25	Director	06/03/2003	06/03/2003	30/06/2009	Active	NO
6	U51397DL2003PTC121362	GUARDIAN HOSPITALS PRIVATE LIMITED	Director	05/08/2003	05/08/2003	-	Active	NO
7	U65993DL1992PLC048665	HANSUTTAM FINANCE LIMITED	Director	20/10/2003	20/10/2003	-	Active	NO
8	U52311DL2004PTC127661	GUARDIAN NUTRITION AND HEALTH SUPPLEMENTS PRIVATE LIMITED	Director	16/07/2004	16/07/2004	-	Active	NO
9	U51397DL2003PTC121502	Guardian Lifecare Private Limited	Managing director	24/01/2005	24/01/2005	-	Active	NO
10	U92132DL2006PTC147878	EQUATION MEDIA PRIVATE LIMITED	Director	23/03/2006	23/03/2006	-	Active	NO
11	U15543HP2007PTC030747	GUARDIAN WATER RESOURCES PRIVATE LIMITED	Director	28/05/2007	28/05/2007	-	Active	NO

Name :

Mr. Vera Garg

Designation :

Director

Address :

LTH -3, PH – The Laburnum, Sushant Lok, Guragoan, Haryana -12202, India

Date of Birth/Age :

26.08.1959

Date of Appointment :

11.09.2008

Din No.:

00013653

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U72200DL2000PTC105891	Equation Enterprises Private Limited	Director	14/06/2004	14/06/2004	-	Active	NO
2	U52311DL2004PTC127661	GUARDIAN NUTRITION AND HEALTH SUPPLEMENTS PRIVATE LIMITED	Director	16/07/2004	16/07/2004	-	Active	NO
3	U51397DL2003PTC121502	Guardian Lifecare Private Limited	Director	11/09/2008	09/05/2005	-	Active	NO
4	U51397DL2003PTC121362	GUARDIAN HOSPITALS PRIVATE LIMITED	Director	01/06/2005	01/06/2005	-	Active	NO
5	U92132DL2006PTC147878	EQUATION MEDIA PRIVATE LIMITED	Director	23/03/2006	23/03/2006	-	Active	NO
6	U15543HP2007PTC030747	GUARDIAN WATER RESOURCES PRIVATE LIMITED	Director	28/05/2007	28/05/2007	-	Active	NO

Name :

Mr. Rajsekar Kuppuswami Mitta

Designation :

Director

Address :

1, Nweron Raod, #24-3 New One, Singapore

Date of Birth/Age :

29.11.1956

Date of Appointment :

13.10.2205

Din No.:

01040742

Name :

Mr. Rajeev Kumar Bakshi

Designation :

Director

Address :

4427, Cameron Court, Richmond BC, Canada

Date of Birth/Age :

14.05.1959

Date of Appointment :

13.10.2205

Din No.:

00748587

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U51397DL2003PTC121502	Guardian Lifecare Private Limited	Director	13/10/2005	09/05/2005	-	Active	NO

Name :

Mr. Nalinkant Amratlal Rathod

Designation :

Director

Address :

Wisma Bakrie 2, 6^th Floor, Jakarta, JI HR Rasuna Said, Kav B -11, Kunnigan, Jakarta

Date of Birth/Age :

12.05.1950

Date of Appointment :

11.09.2008

Din No.:

00272129

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U74140AP1999PTC032745	ELITSER IT SOLUTIONS INDIA PRIVATE LIMITED	Director	11/07/2000	11/07/2000	-	Active	NO
2	L26931AP1986PLC006480	RESTILE CERAMICS LIMITED	Director	01/04/2009	27/01/2003	-	Active	NO
3	L65990MH1984PLC031909	PIONEER INVESTCORP LIMITED	Director	21/08/2008	18/01/2008	-	Active	NO
4	U51909AP2008PTC058254	RESTILE MARKETING PRIVATE LIMITED	Director	19/03/2008	19/03/2008	-	Under Process of Striking off	NO
5	U51397DL2003PTC121502	Guardian Lifecare Private Limited	Director	11/09/2008	24/03/2008	-	Active	NO
6	U65910KA1996PTC020066	ATREYA FINANCE PRIVATE LIMITED	Director	30/09/2009	30/03/2009	-	Active	NO
7	U18907GJ1993PLC018901	BELL GRANITO CERAMICA LIMITED	Director	26/07/2011	08/04/2009	-	Active	NO
8	U24230MH2004PTC148417	NEXGEN HEALTHCARE PRIVATE LIMITED	Director	25/09/2009	29/08/2009	-	Active	NO
9	U24229MH2001PTC130260	ENEM NOSTRUM REMEDIES PRIVATE LIMITED	Director	25/09/2009	29/08/2009	-	Active	NO
10	U72900MH2007PTC173481	NOSTRUM TECHNOLOGIES PRIVATE LIMITED	Director	25/09/2009	29/08/2009	-	Active	NO
11	U24239MH2007PTC167239	Symmetrix Biotech Private Limited	Director	25/09/2009	29/08/2009	-	Active	NO

Name :

Mr. Ron Drori

Designation :

Director

Address :

UI, Sarmacka 18 AP14, Warsaw

Date of Birth/Age :

21.09.1958

Date of Appointment :

17.05.2011

Din No.:

03519651

Other Directorship:

S.No.	CIN/LLPIN	Name of the Company/ LLP	Current designation of the Director/ Designated Partner	Date of appointment at current designation	Original date of appointment	Date of cessation	Company/ LLP Status	Defaulting status
1	U51397DL2003PTC121502	Guardian Lifecare Private Limited	Director	30/11/2011	17/05/2011	-	Active	NO

KEY EXECUTIVES

Name :	Mr. Neeta Guglani
Designation :	Secretary
Address :	1070B/29, Krishna Colony, Gurgaon- – 122001, Haryana, India
Date of Birth/Age :	18.04.1976
Date of Appointment :	12.03.2008
Pan No.:	AJFPG5906P

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.11.2011

Names of Shareholders	No. of Shares
Ashutosh Garg	6595136
Veera Garg	243353
Rajsekar Kuppuswami Mitta	1695397
Equation Enterprises Private Limited	2770182
Ashwin Garg	10000
Varun Garg	10000
Dipankar Sanyal	20000
Rajeev Kumar Bakshi	385715
Nalinkant Amratlal Rathod	973091
Manu Sawhney	100000
Akshaya Bhagava	135135
Rohit Sobti	119204
Venkates Sethuraman	130000
George Castelaino	130000

As on 30.11.2011

Category	Percentage
Foreign holdings [Foreign institutional investors, Foreign Companies, Foreign Financial Institutions, Non-resident Indian or Overseas corporate bodies or others]	30.60
Bodies corporate	17.31
Directors or relatives of directors	35.84
Other top fifty shareholders	16.25
Total	100.00

BUSINESS DETAILS

Line of Business :

Retail Chain of Health and wellness stores.

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

· IDBI Bank Limited, IDBI Tower WTC Complex, Cuffe Parade, Mumbai – 400005, Maharashtra, India

· Syndicate Bank, Corporate Finance Branch, Sector – 5, R.K Puram, New Delhi -110022, Delhi, India

Facilities :

Rs. In Millions

UNSECURED LOAN	31.03.2011	31.03.2010
Rupee term loans banks unsecured	1.471	0.293
Loans directors unsecured	5.500	5.500
Total	6.971	5.793

Banking Relations :	--
Financial Institution:	Indiabulls Housing Finance limited, F -60, Malhotra Building 2^nd Floor, Connught Place, New Delhi – 110001, Delhi, India
Auditors :
Name :	Price Waterhouse and Company Chartered Accountant
Address :	8 The Floor, Building 8, Tower B, DLF Cyber City, Gurgaon – 122002, Haryana, India
Pan No.:	AAAFP8828M
Enterprises which are owned, or have significant influence of or are partners with Key management personnel and their relatives:	Equation Enterprises Private Limited CIN No.: U72200DL2000PTC105891
Subsidiaries :	· Guardian Nutrition And Heal Th Supplements Private Limited CIN No.:U52311DL2004PTC127661 · Equation Media Private Limited CIN No.U92132DL2006PTC147878 · Guardian Hospitals Private Limited CIN No.: U51397DL2003PTC121362 · Guardian Water Resources Private Limited U15543HP2007PTC030747

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
25000000	Equity Share	Rs.10/- each	Rs.250.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
19415912	Equity Share	Rs.10/- each	Rs.194.159 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		194.159	194.159	161.398
2] Share Application Money		0.839	0.839	0.000
3] Reserves & Surplus		329.145	329.145	327.945
4] (Accumulated Losses)		(767.692)	(539.629)	(329.296)
NETWORTH		(243.549)	(15.486)	160.047
LOAN FUNDS
1] Secured Loans		0.000	0.000	0.000
2] Unsecured Loans		6.971	5.793	1.109
TOTAL BORROWING		6.971	5.793	1.109
DEFERRED TAX LIABILITIES		0.000	0.000	0.000
TOTAL		(236.578)	(9.693)	161.156
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		107.687	93.003	107.080
Capital work-in-progress		0.079	24.356	25.312
INVESTMENT		11.791	14.291	8.817
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	298.083	282.231	208.917
	Sundry Debtors	93.054	61.734	60.996
	Cash & Bank Balances	25.578	23.968	25.451
	Other Current Assets	2.653	3.517	3.195
	Loans & Advances	83.637	139.314	145.536
Total Current Assets		503.005	510.764	444.095
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditor	448.809	290.901	112.687
	Other Current Liabilities	404.352	354.638	306.606
	Provisions	5.979	6.568	4.855
Total Current Liabilities		859.140	652.107	424.148
Net Current Assets		(356.135)	(141.343)	19.947
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		(236.578)	(9.693)	161.156

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Income
		Other Income
		TOTAL (A)	1234.360	1053.680	696.770
Less	EXPENSES
		TOTAL (B)	1425.590	1227.053	840.191
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		(191.230)	(173.373)	(143.421)
Less	FINANCIAL EXPENSES (D)		22.210	21.730	10.540
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		(213.440)	(195.103)	(153.961)
Less/ Add	DEPRECIATION/ AMORTISATION (F)		14.620	15.230	18.350
	PROFIT BEFORE TAX (E-F) (G)		(228.060)	(210.333)	(172.311)
Less	TAX (H)		0.000	0.000	7.084
	PROFIT AFTER TAX (G-H) (I)		(228.060)	(210.333)	(179.395)
	Earnings Per Share (Rs.)		(11.75)	(12.46)	(11.66)

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	(18.48)	(19.96)	(25.75)
Net Profit Margin (PBT/Sales)	(%)	(18.48)	(19.96)	(24.73)
Return on Total Assets (PBT/Total Assets}	(%)	(37.35)	(34.84)	(31.26)
Return on Investment (ROI) (PBT/Networth)		(0.94)	(13.58)	(1.08)
Debt Equity Ratio (Total Liability/Networth)		3.56	42.50	2.65
Current Ratio (Current Asset/Current Liability)		0.59	0.78	1.05

LOCAL AGENCY FURTHER INFORMATION

Check List by Info Agents	Available in Report [Yes/No]
Year of Establishment	Yes
Locality of the Firm	Yes
Constitution of the firm	Yes
Premises details	No
Type of Business	Yes
Line of Business	Yes
Promoters background	Yes
No. of Employees	Yes
Name of Person Contacted	No
Designation of contact person	No
Turnover of firm for last three years	Yes
Profitability for last three years	Yes
Reasons for variation <> 20%	-
Estimation for coming financial year	No
Capital the business	Yes
Details of sister concerns	Yes
Major Suppliers	No
Major Customers	No
Payment Terms	No
Export / Import Details [If Applicable]	No
Market Information	-
Litigations that the firm / promoter involved in	-
Banking Details	Yes
Banking Facility Details	Yes
Conduct of the banking account	-
Buyer visit details	-
Financials, if provided	Yes
Incorporation details, if applicable	Yes
Last accounts filed at ROC	Yes
Major Shareholders, if applicable	Yes

Note: The Registered office of the company has been shifted from 85, Anand Lok, New Delhi -79, Delhi, India to the present address we.e.f. 09.09.2010

ABOUT THE COMPANY

The company is an eight-year-old retail chain of health and wellness stores. They are present in 26 cities across India. Positioned as "The Chemists India Trusts", Guardian's customer premise has been built on providing "reliable medicines" in a retail environment that is uniquely branded. Guardian currently serves 1 crore customers each year. The company has been honoured as the "Most Admired Retailer of the Year for the year 2010 in Healthcare and Pharmacy category at the India Retail Forum. Guardian Lifecare is the only pharmacy chain that is present at the prestigious Terminal 3 of Delhi International Airport.

The company has also started its Franchisee business and currently has 28 Franchisees.

Form 8

Corporate identity number of the company	U51397DL2003PTC121502
Name of the company	GUARDIAN LIFECARE PRIVATE LIMITED
Address of the registered office or of the principal place of business in India of the company	A-258, Okhla Industrial Area, Phase –I, New Delhi, Delhi – 110020, India Email: neeta.guglani@guardianlifecare.com
This form is for	Creation of charge
Type of charge	Immovable Property
Particular of charge holder	The Saraswat Co- Operative Bank Limited, 2^nd Floor Above F C Road Branch Ganehwadi, Opposite Hotel Vaishali, Shivaji Nagar, Pune -411004, Maharashtra, India Email: ajisingh@indiabulls.com
Nature of instrument creating charge	Loan Agreement dated 31st July 2011 executed between Indiabulls Housing Finance Limited (Lender/IIHFL) and M/s Guardian Lifecare Private Limited and Guardian Nutrition and Health Supplements Private Limited(Borrowers). As a security for the repayment of the loan, an equitable mortgage of property was created by way of deposit of original title deeds relating hereto, with the lender.
Date of instrument Creating the charge	31.07.2011
Amount secured by the charge	Rs.41.000 Millions
Brief of the principal terms an conditions and extent and operation of the charge	Rate of interest: Currently 15% p.a (adjustable Rate of Interest =IHFL-LFRR-2% p.a) Terms of repayment 120 Equated monthly Installments(EMIs) of Rs. 6,61,474/-. No prepayment permitted within 6 months of commencement of EMIs. Margin None Extent and operation of the charge Equitable mortgage by deposit of original title deeds in favour of IHFL to secure the loan sanctioned by IHFL to the Borrowers alongwith interest thereon, add. interest, charges, fees etc. and all other amount payable by the Borrowers to IHFL.The security created in favour of IHFL, to be continuing security to IHFL till all such time that the entire loans/dues/outstanding of Borrower(s) are repaid in full. Others: The borrower shall not transfer,lease out,assign,dispose off or otherwise part with the mortgaged property or any part thereof without the prior written consent of the lender. Other terms and conditions as per Loan Agreement.
Short particulars of the property charged (Including location of the property)	Plot no. 52, sector 34, Infocity, Gurgaon

Contingent Liabilities:

Bank Guarantee 50.000 Millions

Corporate Guarantee given on behalf of Subsidiary Company Rs.5.118 Millions

b) The Company had received an assessment order relating to assessment year 2008–09 & 2009-10, wherein certain items had been disallowed and the returned loss had been reduced. The Company has filed an appeal to the CIT (Appeals) against the same. Also, penalty proceedings under section 271(1)(c) have been initiated against the Company & against which stay has been taken.

c) During the financial year 2008-09 the Company had received an assessment order relating to assessment year 2006 – 07, wherein certain items had been disallowed and the returned loss had been reduced. The Company has filed an appeal to the CIT (Appeals) against the same. Also, penalty proceedings under section 271(1)(c) have been initiated against the Company & against which stay has been taken.

d) For assessment year 2007-2008 the company had filed the return of income declaring a loss of Rs. 36.452 Millions As per the assessment order certain capital receipts have been considered as revenue receipts and certain expenses have been disallowed. Accordingly, the Company received an assessment order under section 143(3) of the Income Tax Act, 1961 with a demand of Rs.58.694 Millions. The Company then filed an application for rectification under section 154 of the Income Tax Act, 1961 against the said order. Thereafter, the Company received an order under Section 154 of the Income Tax Act whereby the demand was reduced to Rs. 18.183 Millions The company has deposited, under protest, an amount of Rs. 9.000 Millions till March 31, 2011 which has been disclosed under Loans and Advances and has filed an appeal with CIT (Appeals).

e) Deputy Commissioner, commercial Tax Noida has made provisional assessment for the month of September 2009 and raised a demand of Rs. 0.162 Millions The company has deposited the same and has filed appeal against the order before additional commissioner (appeal) commercial tax, Noida.

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.55.37
UK Pound	1	Rs.85.95
Euro	1	Rs.67.87

INFORMATION DETAILS

Report Prepared by :

BYI

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	2
PAID-UP CAPITAL	1~10	2
OPERATING SCALE	1~10	2
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	2
--PROFITABILIRY	1~10	-
--LIQUIDITY	1~10	1
--LEVERAGE	1~10	1
--RESERVES	1~10	1
--CREDIT LINES	1~10	1
--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	NO
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	NO
TOTAL		12

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

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