Sample Business Contracts


Debenture Charge - Bank of New Zealand and Total Energy Systems Ltd.


                              Bank of New Zealand
                             A.R.B.N. 000 000 288


[This Security must be registered with the Australian Securities Commission
within 45 days of its date.]


                                DEBENTURE CHARGE


Name of Customer:  TOTAL ENERGY SYSTEMS LIMITED ACN 010 876 150
                   ---------------------------------------------
Date:___________________________________________________________
<PAGE>
 
THIS DEED made the _____ day of ______________ 19______

BETWEEN   The Person(s) described in Item 1 of the Schedule (hereinafter
          referred to as the "Customer") of the one part

AND       BANK OF NEW ZEALAND (A.R.B.N. 000 000 288) (hereinafter referred to as
          the "Bank") of the other part

WITNESSES that for valuable consideration received, the Customer COVENANTS AND
AGREES with the Bank and it is HEREBY DECLARED as follows:

1. INTERPRETATION

(1)  Definitions

     The Customer agrees that in this Security, unless the context Otherwise
     requires:

     "ASC LAW" has the same meaning as it has in the Corporations Act of the
     State or Territory named in Item 4 of the Schedule or, if there is no State
     or Territory so named, has the same meaning as it has in the Corporations
     Act of New South Wales;

     "ATTACHMENT NOTICE" means a notice pursuant to Section 255 or Section 218
     of the Income Tax Assessment Act 1936 (Cth.) or any analogous process
     pursuant to a similar provision of any other law (whether Federal, State,
     of a Territory or of a foreign country or any of its, political
     subdivisions) in respect of unpaid taxes or other statutory charges payable
     by or levied on or assessed or assessable against the Customer or any
     property or assets of the Customer;

     "BANK" includes its successors, transferees and assigns;

     "BANKING DAY" means in relation to any payment, a day on which the Bank is
     open for business in the place where payment is required to be made;

     "CORPORATIONS LAW" has the same meaning as it has in the Corporations Act
     of the State or Territory named in Item 4 of the Schedule or, if there is
     no State or Territory so named. has the same meaning as it has in the Act
     of New South Wales;

     "CUSTOMER" when only one person is named as the Customer includes the
     Customer its successors and assigns and when two or more persons are named
     as the Customer it includes each of those persons severally and any two or
     more of them jointly and each of their respective successors. and assigns
     and a reference to the Customer includes a reference to any one or more of
     the persons named as the Customer;
<PAGE>
 
     "INTELLECTUAL PROPERTY" means all copyrights, patents, designs and
     inventions and fees, royalties and other rights of every kind deriving from
     copyright. patents, designs and inventions now or at any time in the future
     belonging to the Customer;

     "LAW" means common law equity statute law and subordinate legislation;

     "LEASE" (whether as a noun or verb) includes licence or license;

     "MONTH" means calendar month;

     "MONEYS SECURED" has the meaning ascribed to that expression by Clause 2(3)
     as that meaning may be extended by Clause 26(7);

     "MORTGAGED PROPERTY" means all the undertaking, property, rights and assets
     for the time being and from time to time charged in favour of the Bank by
     this Security or intended so to be and references to the "Mortgaged
     Property' include a reference to any part or parts thereof;

     "OFFICER OF THE BANK" means and includes every Bank employee whose title
     includes the word"Manager" and every Bank employee who is occupying an
     office the title of which includes the word"Manager";

     "PERMITTED PRIOR CHARGE" means a mortgage, charge, pledge, lien or other
     security created or permitted to subsist with the prior written consent of
     the Bank and in accordance with and subject to such conditions as the Bank
     may attach to such consent, including any referred to in Item 2 of the
     Schedule;

     "RECEIVER" includes a receiver and manager;

     "SECURITY" includes a guarantee and an indemnity;

     "SECURITY INSTRUMENTS" includes bills of exchange promissory notes drafts
     cheques bills of lading warrants stock warrants bond warrants storage
     warrants contracts contracts of purchase contracts of sale certificates
     certificates of title title deeds leases licences stock shares scrip stock
     certificates scrip for shares certificates for shares wheat certificates
     notes debentures debenture stock inscribed stock bonds options and rights
     to acquire any thereof receipts railway receipts transmission receipts term
     and call deposit receipts liens bills of sale mortgages delivery orders
     assignments life policies marine policies policies of insurance in respect
     of 

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<PAGE>
 
     buildings erections plant machinery stock in trade or other property
     savings certificates grants letters of credit and all deeds documents
     instruments writings and evidence of ownership of or interest in or
     security over real or personal property;

     "SUBSIDIARY" has the same meaning as in the Corporations Law;

     "SURETY" includes:

     (a)  any person (other than the customer) who is liable whether alone or
          jointly, or jointly and severally for payment to the Bank of the
          Moneys Secured or any part thereof; and

     (b)  except in Clause 3(t)(ii) where there is more than one Customer each
          other of the Customers and in respect of the obligations given by any
          two or more (but not all) of the Customers each other of the
          Customers;

     "THIS SECURITY" includes the Schedule;

     "TORRENS STATUTE" means such of the Transfer of Land Act 1958 (Vic), the
     Real Property Act 1900 (NSW), the Real Property Act 1861 (Qld), the Real
     Property Act 1886 (SA), the Transfer of Land Act 1893 (WA) or the
     equivalent enactment in any other State or Territory which is applicable in
     the jurisdiction of the place named in Item 4 of the Schedule;

     "TRUST" means the trust (if any) established by the documents described in
     Item 5 of the Schedule in respect of which the Customer acts as trustee and
     includes each trust (whether or not described in this Security) as trustee
     of which the Customer gives this Security;

     "TRUST DEED" means the documents pursuant to which each Trust was
     established, and includes, in each case, all variations and supplements to
     those documents made now or (with the prior written consent of the Bank)
     made in the future;

     "TRUST FUND" means each trust fund comprised of the assets, property and
     revenues held or to be held by the Customer as trustee of the Trust;

     words importing persons include bodies corporate;

     words importing the singular include the plural and vice-versa and words
     importing gender include every other gender;

     references to any statute, code or order, ordinance, regulation, rule or
     by-law made under or pursuant thereto 

                                       3
<PAGE>
 
     includes all amendments or consolidations of or substitutions for any
     thereof from time to time.

(2)  HEADINGS

     The Clause headings and margin notes shall not affect the interpretation of
     this Security.

(3)  CUSTOMER

     The Customer agrees that where the "Customer" comprises two or more
     persons, the obligations undertaken under this Security by the Customer
     shall be deemed to be undertaken by such persons jointly and also severally
     and the act or default of any one of them shall be deemed to be the act or
     default of both or all of them.

2. MONEYS SECURED

 (1) PAYMENT ON DEMAND
     (Payment of "Moneys Secured")

     Subject to any agreement in writing between the Customer and the Bank to
     the contrary, the Customer will pay to the Bank on demand in writing made
     by or on behalf of the Bank the whole or such part as is specified in the
     demand of:

     (a)  all moneys which now are or at any time in the future may be or become
          due owing or payable to the Bank in any manner or on any account or by
          reason of any transaction or circumstance whatsoever by the Customer
          whether alone or jointly or jointly and severally with any other
          person and in whatever name, firm or style and whether as principal or
          surety or as trustee of a trust(the "Customer in any capacity"),

     (b)  all moneys which the Bank (whether requested so to do or not) has
          already advanced or paid or is liable to pay or may in the future
          (whether requested so to do or not) advance or pay or become liable to
          pay to or for or on account of or on behalf of the Customer in any
          capacity,

     (c)  the amount of all liabilities whether actual contingent or prospective
          and whether direct or indirect now existing or in the future incurred
          by the Customer in any capacity to or in favour of the Bank and
          whether arising on or in respect of any instrument transaction or
          circumstance or in contract or tort or otherwise, including, without
          limitation, the amount of any orders, drafts, cheques, promissory
          notes, bills of exchange and other instruments or engagements (whether
          negotiable or 

                                       4
<PAGE>
 
          not) in respect of which the Customer in any capacity is or may become
          liable in any manner or on any account or by reason of any transaction
          or circumstance whatsoever and which have been or may in the future be
          drawn accepted endorsed discounted or paid by the Bank or which are or
          may as a result of any circumstance or transaction entered into by the
          Bank with or for or on behalf of or at the express or implied request
          of the Customer in any capacity be held or owned by the Bank whether
          as a holder in due course or otherwise and whether such orders,
          drafts, cheques, promissory notes, bills of exchange and other
          instruments or engagements have matured or not,

     (d)  all moneys which now are or at any time in the future may be or become
          due, owing or payable by or on behalf of the Customer in any capacity
          to or in relation to any transaction with or through the Bank for any
          government taxes, charges, duties and imposts (even if of a wholly
          novel character including without limitation, all stamp duties, credit
          business duties, loan instruments duties, financial institutions
          duties, bank account debit tax, penalties and interest) and for
          discounts, postages, commissions, charges, exchanges, re-exchanges,
          fees and expenses according to the usage and course of business of the
          Bank from time to time,

     (e)  the amount of any taxes. duties. imposts, costs. charges. expenses and
          liabilities of any kind or description now or in the future incurred
          by the Bank-

          (i)  about the negotiation. preparation. execution. registration.
               perfection. stamping, construction or enforceability of this
               Security or any document (whether or not under seal and whether
               of further assurance or otherwise) which may be executed by or on
               behalf of the Customer in any capacity or the Bank or any other
               person in pursuance of any of the provisions contained in this
               Security,

         (ii)  under or in respect of this Security or any such document or any
               transaction evidenced or secured thereby,

        (iii)  in the exercise or enforcement or attempted exercise or
               enforcement of any right power or remedy, under this Security or
               any such document or transaction or which the Bank has or is
               entitled to for any reason against the Customer in any capacity
               or in respect of the Mortgaged Property,

     including (without [imitation) the amount of any taxes, duties, imposts,
     costs. charges, expenses and liabilities not 

                                       5
<PAGE>
 
     otherwise mentioned in this paragraph which are incurred by the Bank in
     respect of the Mortgaged Property and the amount of any costs charges and
     disbursements for legal advice and assistance to the Bank as between
     solicitor and own client on a full indemnity basis,

     (f)  all moneys and amounts mentioned in other provisions of this Security
          as being added to or as forming part of the Moneys Secured or which
          the Bank is now or in the future becomes entitled to debit and charge
          to any account of the Customer in any capacity whether pursuant to
          this Security or by reason of any transaction or circumstance or under
          any security or document now or in the future held by the Bank from or
          relating to the Customer in any capacity,

     (g)  all and every part of any moneys and amounts (whether or not failing
          under a preceding paragraph but without limiting the generality
          thereof) -

          (i)  which are presently owing and payable or are owing but not
               presently payable or are owing upon a contingency or remain
               unpaid to the Bank (whether as original obligee or as assignee,
               transferee or in any other capacity) by the Customer in any
               capacity, or

         (ii)  which may be or become owing to the Bank (whether as original
               obligee or as assignee, transferee or in any other capacity) or
               for which the Bank (whether as original obligee or as assignee,
               transferee or in any other capacity) may be or become liable, in
               each case, by reason wholly or partly of past events or by reason
               of anything done or omitted to be done by the Bank (whether as
               original obligee or as assignee, transferee or in any other
               capacity) or by the Customer in any capacity, or

        (iii)  which may reasonably foreseeably become owing to the Bank
               (whether as original obligee or as assignee, transferee or in any
               other capacity) on any account or by reason of any transaction or
               circumstance or in any manner whatsoever by reason of the
               relation of banker and customer or by operation of law or equity
               or otherwise by reason of anything done by the Customer in any
               capacity or done by or through the Bank (whether as original
               obligee or as assignee, transferee or in any other capacity) with
               the consent or at the express or implied request of the Customer
               in any capacity.

                                       6
<PAGE>
 
     (h)  interest on so much of the moneys and amounts mentioned in the
          preceding paragraphs (including interest and compound interest,
          whether turned into or added to principal or not) as shall for the
          time being or from time to time be owing or payable or remain unpaid
          at the rate(s) and otherwise in accordance with any related agreement
          in writing or to the extent that there is no such agreement, at the
          rate(s) from time to time determined (or redetermined) by the Bank
          with reference to all or any part of such moneys and amounts without
          any requirement to give notice to the Customer in any capacity or any
          other person and without (unless the Bank otherwise in writing agrees)
          allowing credit for any credit balance in any account or accounts of
          the Customer whether alone or jointly with any other person with the
          Bank and otherwise on the following terms and conditions:

          (i)  without prejudice to the Bank's right to demand or enforce
               payment of any of the Moneys Secured interest shall accrue from
               day to day, shall be computed from the day or respective days of
               the first to occur of such moneys and amounts being advanced or
               paid or becoming owing, and shall be payable at the end of such
               period(s) ending at the end of such day(s) as the Bank from time
               to time determines (or redetermines) but, if demanded earlier,
               shall be payable on demand,

         (ii)  overdue interest and interest upon which interest has become
               payable shall itself bear interest at the rate(s) and on the
               terms and conditions of this paragraph, may be debited against
               the Customer in any capacity at the option of the Bank and
               without any requirement to give notice, and shall not be or be
               deemed for any reason to have become turned into or added to
               principal except as and from the time when the Bank, in its
               entire discretion and by express entry to that effect in its
               books, turns such interest into and adds it to principal, and

        (iii)  the Bank may continue to debit and add interest and compound
               interest to principal and the provisions herein contained as to
               the moneys and amounts (including interest and compound interest)
               on which interest is payable shall continue to apply until all
               the Moneys Secured (including interest and compound interest)
               have been paid in full notwithstanding that as between the Bank
               and the Customer in any capacity or any other person the
               relationship of banker and customer may have ceased or the death,
               bankruptcy, official management, winding up or going into
               receivership or 

                                       7
<PAGE>
 
               receivership and management or other legal disability of the
               Customer in any capacity or any other person or any composition
               or compromise entered into or assented to by the Bank with or in
               respect of the Customer in any capacity or any other person or
               any judgment obtained against the Customer in any capacity or any
               other person and notwithstanding any other matter or thing
               whatsoever,

     BUT does not include any amount of income tax on any interest or any amount
     in respect Of income tax mentioned in Section 261 Of tile Income Tax
     Assessment Act 1936 (Cth.) included in or added to interest payable by the
     Customer under this Security.

(2)  CUSTOMER IN ANY CAPACITY
     (Extended meaning of Customer in any capacity)

     Each reference in this Clause 2 to the Customer In any capacity includes
     (where the context permits)

     (a)  a reference to each other person whose indebtedness to the Bank is
          intended to be secured by this Security whether alone or jointly or
          jointly and severally with any other person, and

     (b)  a reference to the Customer in any of the capacities mentioned in
          Clause 2(1)(a).

(3)  MONEYS SECURED
     (Definition of "Moneys Secured")

     This Security extends and applies to and in relation to each and every item
     of the moneys and amounts referred to in this Clause and all such moneys
     and amounts (whether in the nature of principal, interest. compound
     interest, reimbursement, damages or otherwise) are intended to be secured
     by this Security and are referred to as the "Moneys Secured" in this
     Security.

(4)  MERGER
     (Payment of interest if merger in judgment)

     If the liability of the Customer in any capacity to pay the Bank any of the
     Moneys Secured becomes merged in a judgment or order the Customer will pay
     the Bank on demand interest on the amount for the time being owing under
     the judgment or order at the rate and in the manner provided in Clause 2(l)
     for the payment of interest on the Moneys Secured.

                                       8
<PAGE>
 
(5)  COMPROMISE
     (Money deemed to be unpaid notwithstanding compromise)

     In interpreting this Security money shall be deemed to remain unpaid
     notwithstanding any compromise, compounding or release made or assented to
     by the Bank with or in respect of the Customer in any capacity or any other
     person until the Bank has received the full amount to which it would have
     been entitled if it had not entered into such compromise, compounding or
     release but the amount of moneys deemed to have remained unpaid shall not
     include such sums as the Bank has actually received in respect thereof.

(6)  CERTIFICATE
     (Certificate by Bank officer to be conclusive evidence)

     For the purposes of this Security and to the full extent permitted by law,
     a certificate signed by any officer of the Bank stating any one or more of
     the following:

     (a)  the amount of the Moneys Secured or any part thereof;

     (b)  that such amount falls within the description or any part of the
          description of the Moneys Secured;

     (c)  that such amount is due, owing or payable to the Bank by the Customer
          in any capacity or any other person whose indebtedness to the Bank is
          intended to be secured by this Security;

     (d)  that the Bank is entitled to payment thereof on demand;

     shall be conclusive evidence (or, to the extent that is not permitted by
     law, shall be prima facie evidence) of the truth of its contents and shall
     be binding on the Customer.

3.   ACCELERATION
     (Events causing acceleration of payment of Moneys Secured)

     Notwithstanding any agreement (except an agreement in writing to the
     contrary which specifically refers to this Clause or a clause having the
     effect of this Clause) or course of dealing for the time being subsisting
     between the Customer and the Bank or any indulgence or delay or previous
     waiver of its right to demand payment of the Moneys Secured, the Moneys
     Secured become immediately payable on demand and this Security becomes
     immediately enforceable if any one or more of the following events occurs:

     (a)  (PAYMENT DEFAULT): if the Customer fails to pay any of the Moneys
          Secured when due;

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<PAGE>
 
     (b)  (OTHER DEFAULT): if the Customer fails duty and punctually to perform
          and observe any other covenant, condition or obligation binding on the
          Customer expressed or implied in this Security or any agreement,
          instrument or security which is collateral or ancillary to or
          connected with this Security or to which this Security is collateral
          and (if capable of remedy) such failure is not remedied within
          fourteen (14) days of the Bank giving notice to the Customer requiring
          its remedy;

     (c)  (ENFORCEMENT OF SECURITIES): if an encumbrancer takes possession of or
          a Receiver is appointed to or a warrant of distress or execution is
          levied or enforced against the whole or any part of the undertaking,
          property or assets of the Customer (including the Mortgaged Property);

     (d)  (INDEBTEDNESS DEFAULT): if any indebtedness of the Customer becomes
          due and payable prior to its stated maturity or is not paid upon its
          maturity;

     (e)  (COMPROMISE): if a compromise or arrangement is proposed between the
          Customer and the creditors or any class of creditors of the Customer
          or between the Customer, the creditors or any class of creditors of
          the Customer and any wholly owned subsidiaries of the Customer and the
          creditors or any class of creditors of those subsidiaries or if an
          application is made to a court for an order summoning a meeting of the
          creditors of any class of creditors of the Customer or a meeting of
          the creditors of the Customer and of any of the wholly owned
          subsidiaries of the Customer or of such class or classes of those
          creditors;

     (f)  (CORPORATE INSOLVENCY): if in relation to the Customer-

          (i)  an event happens whereby the Customer is, or if it were a company
               incorporated under the Corporation Law, would be, deemed pursuant
               to the Corporations Law to be unable to pay its debts;

         (ii)  (except for the purposes of a reconstruction or amalgamation
               while solvent on terms approved by the Bank) an application or
               order is made or a resolution is passed, or a meeting is convened
               to consider a resolution, for the winding up, or a notice is
               published for the dissolution without winding up, of the
               Customer;

        (iii)  (except for the purposes of a reconstruction or amalgamation
               while solvent on terms approved by the 

                                       10
<PAGE>
 
                Bank) a liquidator (including a provisional liquidator) is
                appointed to the Customer or the Customer is wound up (whether
                voluntarily or compulsorily) or is placed under official
                management or a meeting of the Customer's creditors is convened
                for the purpose of placing the Customer under official
                management;

          (iv)  (except for the purposes of a reconstruction or amalgamation
                while solvent on terms approved by the Bank) a proposal is made
                by the Customer for a reorganisation, moratorium or other
                administration involving the creditors or any class of the
                creditors of the Customer or a scheme of arrangement or
                composition with or assignment for the benefit of persons
                including the creditors or any class of the creditors of the
                Customer is entered into or resolved to be entered into;

          (v)   an investigation is commenced or made into any part of the
                affairs of the Customer pursuant to the ASC Law;

          (vi)  without the prior written consent of the Bank the Customer
                reduces or attempts to reduce its share capital or passes a
                special resolution determining that any portion of its share
                capital which has not been already called up is not capable of
                being called up except in the event, and for the purposes of a
                winding-up or to buy back any of its ordinary shares;

          (vii) the Customer, without the prior written consent of the Bank.
                makes or attempts to make any alteration in the provisions of
                its memorandum or articles of association which might, in the
                opinion of the Bank, detrimentally affect this Security;

     (g)  (MISREPRESENTATION): if any information furnished to the Bank by or on
          behalf of the Customer in connection with this Security or the
          Customer or any Surety or any transaction in respect of which any
          moneys or amounts forming part of the Moneys Secured (whether prior to
          or after the execution hereof) are or become owing by the Customer to
          the Bank is found to be false or misleading, or if any covenant,
          representation warranty contained in Clause 31 or in any collateral or
          ancillary document or any document entered into in connection with
          this Security proves to be untrue or incorrect in any material
          respect;

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<PAGE>
 
     (h)  (SUB-DIVISION): If the Customer subdivides any parcel of any land
          comprised in the Mortgaged Property or, if any land comprised in the
          Mortgaged Property consists of more than one parcel, calls for an
          apportionment of the Moneys Secured;

     (i)  (MATERIAL CHANGE): if in the opinion of the Bank, there is a material
          adverse change in the business, assets or financial position of the
          Customer which, in the opinion of the Bank, may affect the ability or
          willingness of the Customer duly and punctually to perform and observe
          any covenant, condition or obligation binding on the Customer
          expressed or implied in this Security or any agreement, instrument or
          security which is collateral to this Security or to which this
          Security is collateral;

     (j)  (CHANGE IN CONTROL): where the Customer is a proprietary company
          within the meaning of the Corporations Law if without the prior
          written consent of the Bank any share in the issued share capital of
          the Customer that carries rights to vote at a general meeting of the
          shareholders of the Customer is allotted or transferred to any person,
          whether or not that person is a shareholder in the Customer prior to
          the allotment or transfer or any rights attaching to any shares in the
          issued share capital of the Customer, are varied, altered, enhanced or
          abrogated;

     (k)  (CHANGE OF MANAGEMENT OR CONTROL): if there occurs a transfer, sale or
          other disposition of the assets of the Customer to any person (whether
          acting alone or in concert with other persons), or if any agreement or
          understanding is entered into or obligation assumed by any person in
          relation to the appointment of directors of the Customer such as to
          directly or indirectly transfer the effective management or control of
          the Customer;

     (l)  (CESSATION OF BUSINESS): if the Customer stops payment generally or
          without the prior written consent of the Bank shall cease or threaten
          to cease to carry on its business or where the Customer has been
          admitted to the Official List of any Stock Exchange, if the Customer
          ceases to be so admitted or if shares or other securities of the
          Customer which have been granted Official Quotation are suspended from
          trade on the Stock Exchange or otherwise cease to be tradeable
          (otherwise than by books closing), for a period exceeding 24 hours;

     (m)  (BUILDING WORKS): if 41 the opinion of the Bank any of the Moneys
          Secured are applied for any purpose other than the purpose for which
          they were advanced by the Bank or 

                                       12
<PAGE>
 
          any works for which they were advanced are not carried out and
          performed in a manner satisfactory to the Bank or are not carried out
          or performed with due expedition;

     (n)  (ATTACHMENT NOTICE): if the Customer or the Bank receives notice that
          a decision or threat has been made to issue, or any step is taken to
          serve, an Attachment Notice on any person or an Attachment Notice is
          served on any person;

     (o)  (LOSS OF AUTHORISATIONS): if any of the authorisations, reports or
          evaluations described in Clause 31(2)(b) has not been granted or
          ceases to be in full force and effect or is such that or is modified
          in a manner which, in the opinion of the Bank, may materially and
          adversely affect the business, assets or financial position of the
          Customer or the ability or willingness of the Customer duly and
          punctually to perform and observe its obligations expressed or implied
          under this Security;

     (p)  (FINANCIAL ASSISTANCE FOR ACQUISITION OF OWN SHARES): if the Customer
          breaches section 205 of the Corporations Law, or without the Bank's
          prior written consent, does any act or thing pursuant to Section
          205(10) of the Corporations Law;

     (q)  (TRANSACTION DOCUMENT VOID OR VOIDABLE): if this Security or any
          agreement, instrument or security which is collateral to this Security
          or to which this Security is collateral (any 'Transaction Document")
          or any provision of any Transaction Document ceases for any reason to
          be in full force and effect or becomes void, voidable or
          unenforceable, any law suspends, varies, terminates or excuses
          performance by the Customer of any of its obligations under any such
          document or purports to do any of the same, if it becomes impossible
          or unlawful for the Customer to perform any of its obligations under
          any Transaction Document or for the Bank to exercise all or any of its
          rights. powers and remedies under any Transaction Document or if the
          Customer or any person on its behalf alleges that any Transaction
          Document has been affected as described in this paragraph;

     (r)  (DEFAULT BY SUBSIDIARY): if there occurs in relation to any of the
          Customer's subsidiaries any of the events described in paragraphs (a)
          to (q) (both inclusive) of this Clause construed as if references to
          the "Customer" were each a reference to the subsidiary; or

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<PAGE>
 
     (s)  (TRUSTEE): where the Customer executes this Security as trustee of the
          Trust:

          (i)  if without the Bank's prior written consent the Customer ceases
               to be sole trustee of the Trust;

         (ii)  if without the Bank's prior written consent any part of the
               capital of the Trust Fund is distributed in any way;

        (iii)  if any representation or warranty in Clause 27(3) proves to be
               untrue or incorrect in any material respect;

         (iv)  if an application or order is made in any Court for:

               (A)  removal of the Customer as trustee of the Trust;

               (B)  accounts to be taken in respect of the Trust; or

               (C)  any property of the Trust to be brought into Court or
                    administered by the Court or under its control;

          (v)  if any notice is given or meeting is summoned or proposal is put
               forward for the removal of the Customer as trustee of the
               Mortgaged Property or for the appointment of any other person as
               trustee jointly with the Customer;

         (vi)  if without the prior written consent of the Bank, any alteration
               is made to the Trust Deed or, through the exercise of any power
               under the Trust Deed, to the constitution of the Trust Fund which
               might in the opinion of the Bank detrimentally affect its
               security under this Security, and

        (vii)  if in the case of a unit trust (other than a public unit trust),
               any unit is issued, transferred, redeemed, encumbered or
               otherwise dealt with, without the Bank's prior written consent;

     (t)  (DEFAULT BY SURETY):

          (i)  if there occurs in relation to any Surety any of the events
               described in paragraphs (a) to (s) (both inclusive) of this
               Clause construed as if 

                                       14
<PAGE>
 
               references to the "Customer" were each a reference to the Surety;

         (ii)  where any Surety is a natural person if the Surety dies or
               commits an act of bankruptcy within the meaning of the Bankruptcy
               Act 1966 (Cth.); or

     (u)  (ANALOGOUS EVENTS): anything analogous to or having the same effect as
          any of the events specified above happens under the law of any
          applicable jurisdiction.

4.   FIXED AND FLOATING CHARGE
     (Fixed, floating charge over undertaking, property, rights and assets)

(1)  GRANT OF CHARGE

     The Customer hereby (and to the intent that the security so constituted
     shall be a continuing security in favour of the Bank) charges with the due
     and punctual payment of the Moneys Secured as beneficial owner, the whole
     of its undertaking and all and singular its property, rights and assets
     whatsoever and wheresoever situate both present and future including,
     without limitation, the goodwill of its business and its uncalled and
     called but unpaid capital from time to time (including any premium and
     whether called by its directors or by a Receiver, official manager
     liquidator) and where the Customer gives this Security as trustee of the
     Trust, the Customer hereby (and to the intent) also charges with the due
     and punctual payment of the Moneys Secured as trustee of the Trust and so a
     rank in priority to the interest of the beneficiaries of the Trust all and
     singular the property, rights and assets of the Trust whatsoever and
     wheresoever situate both present and future including, without limitation,
     the goodwill of the business comprised therein, and any proceeds from the
     issue of units in the Trust, if the Trust is a unit trust, which are due
     and payable but remain unpaid, the proceeds of sale of any units in the
     Trust, if the Trust is a unit trust, which have been forfeited and the
     right of the Customer to receive any such proceeds together with the right
     to be indemnified out of the property, assets and revenues comprising the
     Trust Fund in all cases and on all occasions where the Customer as such
     trustee is entitled to be so indemnified.

(2)  EXTENT OF FIXED CHARGE

     The charge so created is -

     (a)  a Fixed charge as regards:

                                       15
<PAGE>
 
          (i)   all estates and other interests in freehold or leasehold land
                and other immovable property (except where the Customer is by
                law prohibited from charging or incompetent to charge the same
                by way of a fixed charge) and all buildings, fences and other
                erections, trade and other fixtures, fixed plant and machine
                from time to time on any such freehold or leasehold land and
                other immovable property;

          (ii)  all book and other debts and monetary claims, together with the
                full benefit of all related guaranteed securities and
                indemnities and all liens, reservations of title, rights of
                tracing and other rights enabling the Customer to enforce any
                such debts or claims;

          (iii) all stocks, shares, debentures (including notes), loan capital,
                rights to subscribe for, convert other securities into or
                otherwise acquire any stocks, shares, debentures and loan
                capital of any other body corporate or any foreign, Federal,
                State, Territorial or local government or any government
                instrumentality, together with all dividends, interest and other
                income and all other rights of whatsoever kind deriving from or
                incidental to any of them;

          (iv)  all goodwill and uncalled capital (including any premium);

          (v)   all Intellectual Property;

          (vi)  all plant and machinery (excluding plant and machinery for the
                time being forming part of the Customer's stock in trade or work
                in progress), and

          (vii) all chattels hired, leased or rented by the Customer to any
                other person together in each case with the benefit of the
                related hiring, leasing or rental contract and any guarantee.
                indemnity or other security for the performance of the
                obligations of any person under or in respect of such contract;
                and

     (b)  a floating charge as regards all other Mortgaged Property.

(3)  CRYSTALLISATION BY NOTICE
     (Fixing of floating charge on notice)

                                       16
<PAGE>
 
     The Bank may by notice in writing to the Company convert the floating
     charge so created into a fixed charge affecting all or any part of the
     property and assets which for the time being are the subject of the
     floating charge.

(4)  CRYSTALLISATION OF FLOATING CHARGE
     (Fixing of floating charge upon certain events)

     As well as becoming a fixed charge by operation of law -

     (a)  the floating charge so created becomes a fixed charge if an event
          specified in Clause 3(e) or 3(f)(i), (ii),(iii),(iv), (v) or (vi), or
          3(l) or 3(s)(i), (ii),(iii) or (iv) occurs in relation to the
          Customer; and

     (b)  the floating charge so created becomes a fixed charge with respect to
          the property and assets affected if an event specified in Clause 3(b)
          (which arises as a result of a breach or threatened breach by the
          Customer of Clause 6(1)(a), 6(1)(c) or 6(1)(e)) occurs or an event
          specified in Clause 3(c) or 3(n) occurs.

(5)  JEOPARDY POWER
     (Bank entitled to possession if seizure or distress)

     If at any time it shall appear to the Bank chat any part of the Mortgaged
     Property shall be in danger of seizure, distress, diligence or other legal
     process, or that the Bank's security there over shall for any other reason
     be in jeopardy, the Bank shall be entitled without notice to the Customer
     to take possession of and hold the same or to appoint a Receiver thereof.

(6)  DECRYSTALLISATION
     (Fixed charge to operate as floating charge on notification by Bank)

     Where pursuant to Clause 4(3), 4(4) or 4(5) the floating charge conferred
     by this Security has become or would be fixed with respect to the whole or
     any of the Mortgaged Property (the "Relevant Assets")

     (a)  the Bank may notify the Customer in writing that the Bank no longer
          requires this Security to operate as a fixed charge with respect to
          the whole or any of the Relevant Assets specified on the Bank's notice
          with effect on and from the effective date specified in the Bank's
          notice,

     (b)  on and from the effective date specified in the Bank's notice -

                                       17
<PAGE>
 
         (i)   the Customer shall be at liberty to deal with the Relevant Assets
               specified in the Bank's notice which were acquired by the
               Customer prior to the effective date as if those Relevant Assets
               had continued to be charged by way of floating charge under this
               Security,

         (ii)  the floating charge conferred by this Security shall continue to
               operate as a floating charge with respect to the Relevant Assets
               specified in the Bank's notice which are acquired on or after the
               effective date, and

         (iii) in the absence of notice to the contrary, any person dealing with
               the Customer in relation to the Relevant Assets shall be entitled
               to rely on the Banks notice as conclusive evidence that the
               Relevant Assets are charged by way of floating charge, or are to
               be treated as if they are charged by way of floating charge,
               under this Security on and from the effective date.

(7) FURTHER ASSURANCE OF RELEVANT ASSETS
     (Floating charge of Relevant Assets)

     The Customer hereby, and by way of further assurance, charges all and
     singular the Relevant Assets with the due and punctual payment of the
     Moneys Secured by way of floating charge on the same terms and subject to
     the same conditions as the floating charge conferred by Clause 4(1) and
     4(2) including, without limitation, the terms and conditions contained in
     Clause 4(3), 4(4) and (5) to the intent that those provisions and Clause
     4(6) and 4(7) shall operate from time to Lime in relation to any Mortgaged
     Property which is subject to or which is to be treated as if it is subject
     to. a floating charge under this Security. If Clause 4(3), 4(4) or 4(5) has
     the effect of converting the floating charge created by this Clause 4(7) to
     a fixed charge in relation to any Relevant Asset, the effect of Clause 4(6)
     shall also then be revoked in relation to that Relevant Asset with effect
     from the date of such conversion.

(8) ADDITIONAL RIGHT OF FURTHER ASSURANCE
     (Specific further assurance)

     Clause 4(7) does not prejudice any rights of the Bank under Clause 5 to
     require the Customer to better or further assure the Mortgaged Property to
     the Bank.

5.  FURTHER ASSURANCE

(1)  GENERAL

                                       18
<PAGE>
 
     (Bank may request Customer to execute further documents for better assuring
     Mortgaged Property)

     The Customer, and every person claiming under or in trust for the Customer,
     will from time to time, whensoever requested by the Bank and at the
     Customer's cost, execute in favour of the Bank, or as the Bank may direct,
     such further or other legal assignments, transfers, mortgages, legal or
     other charges or securities, deeds arid documents as in each such case the
     Bank shall stipulate over the Mortgaged Property for the purpose of more
     effectively providing security to the Bank for the payment or discharge of
     the Moneys Secured.

(2) PROVISIONS IN FURTHER ASSURANCE
     (Form of further assurance determined by Bank)

     Without prejudice to the generality of Clause 5(1), the assignments,
     transfers. mortgages, legal or other charges, or securities, deeds and
     documents to which that Clause refers shall be in such form as shall be
     prepared on behalf of the Bank and may contain provisions such as are
     contained in this Security or provisions to the like effect and such other
     provisions of whatsoever kind (including without limitation powers of sale
     and covenants to pay principal and interest) as the Bank may consider
     requisite for the improvement, perfection or registration of the security
     constituted by this Security or for better assuring the Mortgaged Property
     to the Bank.

(3) ADDITIONAL OBLIGATIONS
     (Implied covenants continue)

     The obligations of the Customer under this Clause 5 shall be in addition to
     and not in substitution for the covenants for further assurance deemed to
     be included in this Security by law.

(4) DEPOSIT OF DEEDS
     (Bank to retain title deeds)

     Subject to the requirements of any person for the time being entitled to a
     Permitted Prior Charge, the Customer will (upon the execution of this
     Security, or upon becoming possessed of any of [hem at any time in the
     future) deposit with the Bank and the Bank will be entitled to retain
     during the subsistence of this Security as further security for the payment
     of the Moneys Secured all deeds and other documents constituting or
     evidencing the title to the Mortgaged Property (including without prejudice
     to the generality of the foregoing any leases granted by the Customer or
     pertaining to the Mortgaged Property if requested by the Bank).

                                       19
<PAGE>
 
(5)  AFFIXATION AND ENDORSEMENT
     (Customer to affix items to or endorse documents)

     The Customer shall, whenever requested by the Bank and at the Customer's
     cost, affix to such items of the Mortgaged Property or endorse or cause to
     be endorsed (a such documents as are referred to in this Clause 5 as the
     document stipulates, labels, signs or memoranda in such form as the Bank
     requires referring or drawing attention to Security.

6.   RESTRICTIONS ON OTHER SECURITIES AND DISPOSALS

(1)  RESTRICTION
     (Negative covenants relating to charges on and certain disposals of the
     Mortgaged Property)

     The Customer agrees that at no time during the subsistence of the security
     constituted by this Security with Customer, otherwise than in favour of the
     Bank, or with the prior written consent of the Bank and in accord with and
     subject to any conditions which the Bank may attach to its consent -

     (a)  (SECURITY INTERESTS): create, grant extend or permit or suffer to
          arise or subsist any mortgage, charge, or fixed security, floating
          charge, pledge, hypothecation or lien (other than a lien arising
          solely by operation of law) or other encumbrance or security interest
          or liability of any kind on or over the Mortgaged Property whether
          ranking or purporting to rank in point of security in priority to,
          equally with, or after the security constituted by this Security or
          enter into an agreement to do so; or

     (b)  (SALE AND OTHER DEALINGS): sell, convey transfer, assign, lease, tend
          or otherwise deal with or part possession or dispose of, whether by
          means of one or a number of transactions related or not and whether
          one time or over a period of time, the whole or any part of the
          Customer's undertaking or (save in the normal course of trading) of
          its property, rights or assets, or enter into an agreement (otherwise
          than an agreement conditional upon the consent or agreement of the
          Bank being obtained) to do so; or

     (c)  (MONETARY CLAIMS): factor or discount or otherwise deal with, dispose
          of. compromise or make or suffer set-off in respect of any of its book
          debts, monetary claims or revenues otherwise than by getting them in
          paying them to such banking account (if any) as is nominated or
          approved

                                       20
<PAGE>
 
     by the Bank (which approval  not be unreasonably withheld) or enter into an
     agreement to do so; or

     (d)  (TRUST OF SALES PROCEEDS): agree to account to or hold upon trust for
          any person the proceeds of sale (including cash, book debts, other
          monetary claims and negotiable and similar instruments) arising out of
          or in connection with any goods sold by the Customer and (whether or
          not in the ordinary course of business) with the express or implied
          authority of the owner of such goods; or

     (e)  (SALE AND LEASE-BACK): convey, transfer, assign, deliver or otherwise
          deal with, part with possession or distribution of any part of the
          Mortgaged Property the subject of the floating charge under this
          Security with the intention or for the purpose of retaining or
          accepting delivery of possession of such property under or pursuant to
          an agreement or arrangement to purchase the same or any lease or
          hiring agreement or arrangement (whether or not containing an option
          for the Customer to purchase) in respect of such property or enter
          into an agreement to do so; or

     (f)  (SECURITY DEPOSITS): deposit moneys with any person if such moneys are
          not repayable unless the Customer pays or discharges any other
          indebtedness or performs or observes any other obligation due to or
          made such person or any other person or where such person requires or
          could for the time being claim or assert set-off or counterclaim or
          enter into an agreement to do so; or

     (g)  (TITLE RETENTION): enter into any transaction under which either (1)
          title to goods supplied to the Customer reserved to the supplier
          thereof or any other person until payment is made for such goods or
          any other goods or services, or (ii) the proceeds of sale by the
          Customer of any goods are held in trust for the supplier of an
          ingredient or component thereof or any other person in contravention
          of the conditions and limitations (if from time to time specified by
          the Bank in relation to such transactions or enter into an agreement
          to do so.

     (h)  (OTHER ACTIONS): do or suffer anything else to be done in derogation
          of the security constituted by this Security.

(2)  POWERS OF RECEIVER
     (Restrictions do not affect Receiver)

     The prohibitions set out in Clause 6(1) shall not be construed as limiting
     any powers exercisable by any Receiver appointed

                                       21
<PAGE>
 
     by the Bank under this Security who is an agent of the Customer.

7.   INSURANCE

(1)  TAKING OUT AND MAINTAINING INSURANCE
     (Customer agrees to insure Mortgaged Property and to comply with insurance
     policies)

     The Customer agrees that the Customer will at all times during the
     subsistence of the security constituted by Security comply with all
     covenants, undertakings and conditions as to the insurance of the Mortgaged
     Property imposed by the terms of any Permitted Prior Charge affecting the
     Mortgaged Property or by the terms of any lease or agreement for lease
     under which the Customer's estate or interest in the Mortgaged Property is
     derived and as far as not prohibited by any such terms, the Customer will:-

     (a)  (INSURE): cause the Mortgaged Property (including, the rent and
          profits, if any, thereof) to be insured and to be kept insured in an
          insurance office or with underwriters approved by the Bank and, if
          through an insurance broker, through an insurance broker approved by
          the Bank (which approvals shall not be unreasonably withheld) against
          loss or damage by fire, storm, tempest, malicious damage, against
          public liability risk or against all such other risks whatsoever as
          the Bank may from time to time stipulate, (in an amount satisfactory
          to the Bank in each case) with the interest of the Bank as mortgagee
          noted by endorsement on the policy of insurance, or if the Bank so
          directs, in the joint names of the Customer and the Bank (the
          "Insurance");

     (b)  (PAY PREMIUMS): duly and punctually pay all premium and other moneys
          payable in connection with the Insurance and promptly upon request by
          the Bank produce to the Bank receipts or other evidence of their
          payment;

     (c)  (NO OTHER INSURANCE): not take out any further or other insurance in
          relation to the Mortgaged Property in the Customer's name alone or do
          or suffer to be done anything which may prejudice any of the Insurance
          or render it void or voidable or which may permit an insurer to
          decline a claim;

     (d)  (INSURED EVENTS): notify the Bank in writing forthwith upon the
          happening of any event which entitles a claim to be made under any of
          the Insurance; and

                                       22
<PAGE>
 
     (e)  (DEPOSIT OF POLICIES): deposit with the Bank as further security for
          the Moneys Secured all policies, certificates of insurance and other
          contracts of insurance relating to the Mortgaged Property (whether or
          not such insurance relates to other property of the Customer) or, if
          the Bank agrees in writing for them not to be so deposited, produce
          the same to the Bank for inspection.

(2)  BANK'S RIGHTS
     (Bank may renew insurance if Customer defaults)

     If the Customer defaults in complying with Clause 7(1) or fails to provide
     the Bank forthwith upon request with evidence satisfactory to the Bank of
     compliance with Clause 7(1) it shall be lawful, but not obligatory, for the
     Bank to effect or renew the Insurance either in its own name or in its name
     and that of the Customer jointly or in the same of the Customer with an
     endorsement of the Bank's interest and any moneys expended by the Bank in
     so effecting or renewing the Insurance shall be reimbursed by the Customer
     to the Bank on demand and shall be added to and form part of the Moneys
     Secured.

(3)  CLAIMS
     (Insurance moneys to be held in trust for Bank)

     All claims and moneys received or receivable under any Insurance or any
     insurance of the Mortgaged Property taken out by the Customer in
     contravention of this Clause shall (subject to the rights and claims of any
     person entitled to the benefit of a Permitted Prior Charge or any lessor of
     any part of the Mortgaged Property) be held by the person receiving such
     moneys in trust for the Bank and shall be applied in repaying or reducing
     the Moneys Secured or, if the Bank so requires, in repairing, replacing,
     restoring or rebuilding the property damaged or destroyed and to pay the
     surplus (if any) to the Customer.

(4)  POWER TO COMPROMISE CLAIMS
     (Bank may compromise claims)

     In the event of damage or loss the Bank shall alone have full power to
     settle or compromise any claim against any insurer under any insurance
     covering the Mortgaged Property whether or not such insurance also covers
     other property.

8.   GENERAL UNDERTAKINGS
     (Customer undertakes to preserve business and Mortgaged Property)

                                       23
<PAGE>
 
     The Customer agrees that the Customer will at all times during the
     subsistence of the security constituted by this Security:-

     (a)  (BUSINESS): carry on and maintain the present character of its
          business in a proper and efficient manner and cause each of its
          subsidiaries to do the same;

     (b)  (MORTGAGED PROPERTY): maintain and protect the Mortgaged Property and
          put into and keep in good and substantial repair and in good working
          order and condition the Mortgaged Property and all buildings fences
          and other erections, and improvements, trade and other fixtures and
          the plant and machinery at any time existing upon or forming part of
          any land comprised in the Mortgaged Property ("Improvements") and not
          at any time (except in the ordinary course of repair, maintenance or
          improvement) demolish, pull down, remove, dismantle, injure, alter or
          add to any of them or by any means lessen or suffer to be lessened the
          value of the Mortgaged Property without the prior consent in writing
          of the Bank;

     (c)  (REPAIR): amend every defect in the repair, working order and
          condition of the Mortgaged Property and any Improvements forthwith on
          being required so to do by the Bank;

     (d)  (ENTRY BY BANK): permit the Bank its agents, servants, employees,
          contractors, consultants and workmen at all times to enter into and
          upon the Mortgaged Property to view and examine the state of repair
          order and condition of the Mortgaged Property and the Improvements and
          do or perform any act, matter or thing which ought to have been done
          or performed by the Customer under this Security or to make good any
          default of the Customer under this Mortgage, and to inspect and take
          copies of or extracts from all books of account, vouchers and other
          documents (including those kept in computer records or other
          electronic forms of data storage) relating in any way to the business
          transactions of the Customer, all at the cost of the Customer (without
          the Bank being or being deemed to be a mortgagee in possession by
          virtue of any such entry) and any moseys expended for all or any of
          such purposes shall form part of the Moneys Secured;

     (c)  (REMOVAL):  if requested by the Bank at any time, remove any structure
          which encroaches on any land in the Mortgaged Property,

                                       24
<PAGE>
 
     (f)  (LEASED PROPERTY): duly and punctually pay all rent and perform and
          observe the covenants and other contained in any lease or agreement
          for lease under which any of the Mortgaged Property may be without
          prejudice to the generality of the foregoing take no step whatsoever
          whereby any such agreement may be forfeited, surrendered or terminated
          or omit to do anything if such omission may such forfeiture, surrender
          or termination and give notice to the Bank forthwith upon the
          happening of an as a result of which the lease or agreement may be or
          become liable to be forfeited, surrendered or terminated.

     (g)  (PERMITTED PRIOR CHARGE): perform and observe all covenants and
          obligations, binding on the Customer any Permitted Prior Charge or any
          other encumbrance and all restrictive and other covenants and
          stipulations for the time being affecting any of the Mortgaged
          Property or its use or enjoyment;

     (h)  (RENT AND TAXES): duly and punctually pay all rents, rates, taxes,
          duties, charges, outgoings and assessments of every description (even
          of a wholly novel character) now or in the future charged or
          chargeable or payable to the Customer or upon or in respect of the
          Mortgaged Property or upon its use or upon the owner or occ in respect
          of the Mortgaged Property and cause each of its subsidiaries to do the
          same in relation to itself, its undertaking, property, rights and
          assets;

     (i)  (COMPLIANCE WITH STATUTES): (unless the Bank requires the Customer to
          make or join with the Bank in such objections, appeals or
          representations as the Bank may consider expedient, in which case the
          Customer shall at the cost of the Customer make or join with the Bank
          in making those objections appear representations) comply with and
          procure that all tenants, employees, agents, contractors or sub-
          contractor of the Customer comply with all statutes, regulations,
          ordinances and by-laws and the requirements of relevant authority or
          order binding on each of them or where non-compliance may impose a
          charge or liability on the Mortgaged Property or prejudicially affect
          this Security or render this Security or the Mortgaged Property liable
          to forfeiture (including without limitation, giving all notices and
          effecting any registration required by law in relation to the Customer
          or the ownership of any land comprised in the Mortgaged Property, and
          obtaining all consents and approvals required in relation to any
          construction on, or use of the Mortgaged Property, and complying with
          all building and fire regulations) and deliver or produce to the Bank
          forthwith upon receipt any notice or order or proposal of

                                       25
<PAGE>
 
          any relevant authority relating to the ownership, use or conditions of
          the Mortgaged Property;

     (j)  (AMOUNTS): keep proper accounting and financial statements in such
          manner and form as may be lawfully required or permitted and therein
          make true and complete entries of all dealings and transactions of and
          in relation to its business and that of each of its subsidiaries and
          procure that the same are at all reasonable times available for
          inspection by the Bank, its employees, professional advisers and
          agents and provide the Bank, its employees. professional advisers and
          agents with all such information respecting the Customer's or any of
          subsidiaries business and affairs as the Bank from time to time
          requires.

     (k)  (AUDIT): at least once in each year or more often if so required by
          the Bank cause the accounting records and financial statements of the
          Customer and its subsidiaries to be duty audited by an auditor
          approved by the Bank (such approval not to be unreasonably withheld)
          and immediately in the future provide the Bank a Copy of the balance
          sheet and trading and profit and loss account of the Customer and each
          of its subsidiaries duly certified by such auditor and the report of
          such auditor;

     (l)  (TITLE RETENTION): provide the Bank on request with information in
          writing as to the number of, and the amount involved in, transactions
          under which either (i) title to goods supplied to the Customer is
          reserved to the supplier thereof or any other person until payment is
          made for such goods or any other goods or services, or (ii) the
          proceeds of sale by the Customer of any goods are held in trust for
          the supplier of any ingredient or component thereof or any other
          person;

     (m)  (COPIES OF ACCOUNTS): furnish to the Bank copies of all reports,
          accounts and notices and circulars issued by it to its members as and
          when issued;

     (n)  (CALLS): not without the prior written consent of the Bank call up or
          receive in advance of calls any of the uncalled capital (or premium)
          hereby charged or apply the same to any purpose other than in or
          towards payment of the Moneys Secured;

     (o)  (RECEIPTS): produce to the Bank forthwith upon demand the receipts for
          all payments referred to in this clause;

                                       26
<PAGE>
 
     (p)  (ACCELERATION EVENTS): do all thing necessary to ensure that no event
          referred to in Clause 3 occurs and notify the Bank in writing
          forthwith upon becoming aware of the occurrence of any such event;

     (q)  (PRIORITY AGREEMENT): if the Customer creates or grants a mortgage,
          charge or encumbrance over the Mortgaged Property after the date of
          this Security ("the Subsequent Security") forthwith upon execution or
          creation of the Subsequent Security and in any event:

          (i)  before any request is made to the Bank to produce the relevant
               instrument of title for registration of the Subsequent Security;
               and

          (ii) before any moneys are secured actually or contingently by the
               Subsequent Security;

          procure the holder of the Subsequent Security to enter into a priority
          agreement with the Bank so as to preserve and confirm the Bank's
          position as mortgagee ranking in priority to the holder of the
          Subsequent Security for an amount and on terms satisfactory to the
          Bank;

     (r)  (INFORMATION): give to the Bank such oral or written information as
          the Bank requires with respect to the Mortgaged Property and all
          matters relating to (he business or affairs of the Customer; and

     (s)  (RESTRICTED TRANSACTIONS): if the Customer is a proprietary company -

          (i)  not make any loan to any member or officer (whether present or
               future) of the Customer or any body corporate which is a related
               body corporate of the Customer within the meaning of the
               Corporations Law or to any spouse, issue, brother, sister or
               ancestor of any such member or officer Without the prior written
               consent of the Bank;

          (ii) include or cause to be included as a term of all loans (whether
               present or future) made to the Customer by any member or officer
               (whether present or future) of the Customer or any body corporate
               which is a related body corporate of the Customer within the
               meaning of the Corporations Law or by any spouse, issue, brother,
               sister or ancestor of any such member or officer a provision that
               for so long as the Moneys Secured remain unpaid no part of such
               loan nor any interest thereon shall be repaid without the written
               consent of the Bank;

                                       27
<PAGE>
 
         (iii) not declare or pay any dividend without the prior written consent
               of the Bank; and

          (iv) not pay or provide any salary or benefit to any member or officer
               (whether present or future) of the Customer or of any body
               corporate which is a related body corporate of the Customer
               within the meaning of the Corporations Law or to any spouse,
               issue, brother, sister or ancestor of such member or officer in
               excess of the amount paid for the financial year of the Customer
               immediately prior to the date of this Security without the prior
               written consent of the Bank or except as required by law.

9.   BANK'S RIGHT TO REMEDY DEFAULT
     (Bank entitled to remedy Customer's default)

(1)  REMEDIAL ACTION
     If at any time the Customer fails, or is believe by the Bank to have
     failed, to perform or observe any of the covenants or conditions contained
     in this Security, it shall be lawful, but not obligatory, for the Bank (but
     without prejudice to any other rights, power or remedy of the Bank) to do
     ad things and pay all moneys necessary or expedient in the opinion of the
     Bank to make good such failure to the satisfaction of the Bank and all
     moneys so paid (with any costs, charges and expenses so incurred) shall be
     deemed to have been properly expended and shall form part of the Moneys
     Secured.

(2)  NOT MORTGAGEE IN POSSESSION
     No exercise by the Bank of its powers under this Clause shall render the
     Bank, or make the Bank liable to account as a mortgagee in possession.

10.  BANK'S RIGHTS ON DEFAULT

(1)  CLAUSE 3 EVENTS
     (Bank's rights on occurrence of Clause 3 events)

     Subject to Clause 10(2), if an event described in Clause 3 occurs the Bank
     may thereupon or at any time after such occurrence (in addition to any
     other rights, powers and remedies conferred on a mortgagee by law) do all
     or any of the following things without giving any or further notice or
     demand to the Customer-

     (a)  (POSSESSION): enter upon and take possession of the Mortgaged Property
          and manage and use the Mortgaged Property and enter into receipt of
          the rents and profits of the Mortgaged Property (with power to demand
          and

                                       28
<PAGE>
 
          recover the same by action or otherwise and give effectual receipts
          therefor) and cam on at the risk of the Customer any business or
          pursuit for the time being or usually carried out on or comprised in
          the Mortgaged Property with all the powers of an absolute owner;

     (b)  (LEASE): whether in or out of such possession and receipt, lease or
          otherwise permit the use of the Mortgaged Property by third persons
          (whether alone or with others and with or without the Bank) in the
          manner and with the powers described in this Security;

     (c)  (SALE): whether in or out of such possession and receipt, sell the
          Mortgaged Property and exercise all other powers conferred upon a
          mortgagee by law;

     (d)  (RECEIVER): whether in or out of such possession and receipt and
          whether or not the Bank is entitled to appoint a Receiver under any
          statute, by writing appoint any person or persons (including any
          employee of the Bank if so permitted by law) to be a Receiver of the
          Mortgaged Property with all the powers and on the terms and conditions
          described in this Security; and

     (e)  (AGENT): appoint and employ one or more agents to act jointly or
          severally on behalf of the Bank in the exercise of any right, Power or
          remedy conferred on the Bank by any law or this Security.

(2)  NO DEMAND OR NOTICE
     (Requirement for demand waived)

     Before the Bank exercises a right, power or remedy conferred by Clause
     10(1) or on a mortgagee by law, the Bank shall give any notice or demand
     and allow any time to elapse which the Bank is required by law to give or
     allow, but to the extent that any notice, demand or lapse of time which is
     otherwise applicable by law is capable of being waived or negatived by
     agreement, it is waived and negatived and, to the extent that any period of
     time which is required to be allowed by law is not capable of being so
     waived or negatived, but is capable of being a being fixed as a lesser
     period, that period is fixed as the longer of whichever is permitted to be
     fixed of  the minimum period required by law.

(3)  NOT ACCOUNTABLE AS MORTGAGEE IN POSSESSION
     (Bank not accountable as mortgagee in possession)

     The Bank shall not by reason of entry into possession of the Mortgaged
     Property be liable to account as in possession or

                                       29
<PAGE>
 
     for anything except actual receipts or be liable for any loss upon
     realization or for any omission for which a mortgagee in possession might
     be liable.

(4)  WITHDRAWAL
     (Bank may withdraw from possession after entry)

     The Bank and any Receiver appointed under this Security may at any time, in
     the Bank's or the Receiver's discretion, withdraw from possession after
     entry or appointment, re-enter and withdraw as often as the Bank or
     Receiver deems expedient.

11.  POWER OF SALE

(1)  METHOD OF SALE
     (Power to sell and ancillary powers)

     Without derogation from the powers referred to in the previous clause and
     merely by way of example and  thereto, upon the power of sale becoming
     exercisable by the Bank, the Bank may forthwith or at any time or from time
     to time in the future -

     (a)  (SALE): sell all or any part or parts of the Mortgaged Property by
          public auction, public tender or private or partly by any such mode of
          sale (and unless prohibited by law with power on a sale by auction to
          of the property offered for sale) and for cash or on terms and upon
          such terms and conditions as thinks fit and either separately as a
          whole or in lots (granting and securing such easements as the Bank
          fit) or together with any other real or personal property which for
          the time being may be mortgage or otherwise held by the Bank from the
          Customer (whether of the same tenure or otherwise) with apportion the
          purchase money and expenses of sale between the Mortgaged Property and
          the other in any manner which the Bank thinks fit and on any sale any,
          time may be allowed for the payment of the or any part or parts of the
          purchase money either with or without taking security for the payment
          of the purchase money and with or without interest and if with
          interest then at any rate or rates nominated Bank;

     (b)  (MAKE PROPERTY MORE SALEABLE): apply for and obtain an amendment of
          the title to or to any Mortgaged Property and do or cause to be done
          any other act deed or thing in the opinion of the Bank or desirable
          for perfecting the title of the Customer thereto or for making the
          Mortgaged Property more saleable or for enabling any land comprised in
          the Mortgaged Property to be sold in subdivided or lots, including but
          not limited to, causing to be made surveys, obtaining town planning,

                                       30
<PAGE>
 
          building permits consents and approvals, acquiring rights of
          carriageway, drainage, sewerage and other easements to any adjacent
          lands, creating over such land rights of carriageway, drainage,
          sewerage and other easements laying out and constructing such roads,
          drains, sewers and other services, and constructing improvements to
          such land, all as are in the opinion of the Bank necessary or
          desirable;

     (c)  (SURRENDER OF TITLE): surrender to the Crown all or any part or parts
          of the Mortgaged Property and with the Crown or with any person all or
          any part of the Mortgaged Property for other property of any either
          with or without giving or receiving any money or other consideration
          for the purpose of equal exchange and any property so acquired shall
          thereupon be held by the Bank on account of the Customer as further
          security (or the Moneys Secured and the power of sale and all other
          rights powers or remedies by any law conferred on the Bank shall apply
          to and be capable of being enforced in respect of that property.

     (d)  (FIXTURES): sever fixtures belonging to the Customer and sell them
          under the power of sale herein conferred apart from the Mortgaged
          Property.

(2)  PROTECTIVE PROVISIONS
     (Power of sale exercisable despite neglect or waiver)

     The Bank's powers of sale may be exercised notwithstanding any previous
     neglect or waiver of any right to prior sale and no demand or notice of
     sale made or given under this Security shall be deemed to be waived because
     prior negotiations or payment of interest or payment on account of the
     Moneys Secured by the Customer subsequent to such demand or notice and such
     demand or notice shall remain in full force and effect notwithstanding
     negotiations or payment until expressly waived in writing by the Bank.

(3)  PURCHASE MONEYS
     (Bank accountable only for moneys actually received)

     The Bank shall be accountable for or chargeable with so much only of the
     purchase money as it actually receives upon a sale and only from the time
     of such receipt notwithstanding that it may have transferred the Mortgaged
     Property to the purchaser and taken a mortgage from the purchaser to secure
     so much of the purchase money as may not have been then actually paid or
     that the Bank may have sold the Mortgaged Property to a purchaser on terms
     without transferring it to the purchaser and notwithstanding a sale the
     Customer shall remain liable

                                       31
<PAGE>
 
     for the Moneys Secured beyond the amount of moneys actually received by the
     Bank.

12.  POWER TO LEASE
     (Mortgaged Property May be leased on terms determined by Bank)

     Upon the Bank becoming entitled to exercise its powers to lease the
     Mortgaged Property the Bank may lease or otherwise permit the use of the
     Mortgaged Property by third parties (whether alone or with others and with
     or without the Bank) for such term and on such terms and conditions as the
     Bank thinks fit and either taking or not taking any fine or premium and
     either at a pecuniary rent or in consideration of the tenant paving or
     delivering to the Bank a share or proportion of the returns or profits
     derived by the tenant from the use of the leased premises and either with
     or without the option to the lessee at during the currency or at the
     termination of any such lease of purchasing the leased premises or any part
     thereof or of renewing any such lease and either for the purpose of
     occupation building agriculture grazing mining or for any other purpose and
     under and subject to such terms and conditions in all respects as the Bank
     thinks fit and if with an option of purchase at such price and upon such
     terms and conditions as the Bank thinks fit with power to the Bank to
     compromise with and make concessions to tenants and vary and accept
     surrenders of leases upon such terms and conditions as the Bank thinks fit
     and to determine any tenancy now existing or which may in the future be
     created and to eject any person from the Mortgaged Property and to
     institute and carry on any proceedings for that purpose.

13.  RECEIVER

(1)  APPOINTMENT AND REMOVAL
     (Bank may appoint or remove one or more Receivers)

     The Bank may appoint one or more persons to be a Receiver or Receivers of
     the whole or any part of the Mortgaged Property or of the income thereof or
     both and may:

     (a)  remove any Receiver previously appointed hereunder; and

     (b)  appoint another person or persons as Receiver or Receivers, either in
          place of a Receiver so removed or who has otherwise ceased to act or
          to act jointly with a Receiver previously appointed.

     If at any time and by virtue of any such appointment any two or more
     persons shall hold office as Receiver of the same part or parts of the
     Mortgaged Property or the income thereof or both, each person shall be
     entitled (unless the contrary shall

                                       32
<PAGE>
 
     be stated in the deed or other instrument appointing them) to exercise all
     the powers and discretions by this Security or by statute conferred on a
     Receiver individually and to the exclusion of the other or others of them.

(2)  WRITING REQUIRED
     (Appointment in writing)

     Every such appointment or removal of a Receiver, and every delegation or
     revocation by the Bank in the exercise of any right to delegate its powers
     or to revoke any such delegation herein contained shall be made either by
     deed or by instrument in writing under the hand of any officer of the Bank
     or any person authorized in writing in that behalf by any officer of the
     Bank.

(3)  POWERS OF RECEIVER
     (General powers)

     Every Receiver for the time being holding office by virtue of such an
     appointment shall (subject to any limitations or restrictions expressed in
     the deed or other instrument appointing him but notwithstanding any
     bankruptcy, winding-up, official management or dissolution of the Customer)
     have in relation to the assets and income in respect of which he is
     appointed power in the name and on behalf and at the cost of the Customer
     to do or omit to do anything which the Customer himself could do or have
     done as an absolute owner and irrespective of any such bankruptcy, winding-
     up, official management or dissolution and, without prejudice to the
     generality of the foregoing:

     (a)  all the powers conferred by law on mortgagors but without the
          restrictions hereby imposed on the Customer;

     (b)  (with the consent of the Bank) all the powers conferred bylaw on
          mortgagees in possession as such powers are hereby varied and extended
          and applicable to the Bank in accordance with the provisions hereof,
          and

     (c)  all the powers conferred by law on Receivers appointed under any
          statute.

     (Specific powers)

     In addition and without prejudice to the generality of the foregoing the
     Bank and every such Receiver shall (notwithstanding any bankruptcy,
     winding-up, or official management or dissolution of the Customer) have the
     Power to do all the following things, namely:-

                                       33
<PAGE>
 
          (i)  (TO TAKE POSSESSION): to take possession of, collect and get in
               the Mortgaged Property and for that purpose to make, or to
               require the directors of the Customer to make, calls upon the
               holders of the Customer's share capital (including in relation to
               any premium) in respect of any such capital of the Customer which
               remains uncalled and to enforce payment of calls so made and any
               previous unpaid calls by taking proceedings in the name of the
               Customer or his own name;

         (ii)  (TO MANAGE): to carry on and manage, or concur in the carrying on
               and management of, the whole or any part of the Customer's
               business including the power where the Customer has one or more
               subsidiaries of supervising, controlling and financing such
               subsidiary or subsidiaries (inclusive of bodies corporate as are
               referred to in sub-paragraph (v) below) and its or their business
               or businesses and the conduct thereof:

        (iii)  (TO IMPROVE): to alter, rehabilitate, improve, develop, complete,
               construct, modify, refurbish or any of the Mortgaged Property
               including without limitation the power to complete or undertake
               or in the completion or undertaking, with or without
               modification, of any project in which the Customer was concerned
               or interested prior to his appointment, being a project for the
               alteration, improvement, development, completion, construction,
               modification, rehabilitation, refurbishment or repair of
               Mortgaged Property;

         (iv)  (TO SELL OR LEASE): to sell, or concur in selling, leasing or
               otherwise disposing of the whole or any pa the Mortgaged Property
               without, so far as it is possible to so provide, the need to
               observe the restrictions imposed by law and upon such terms and
               conditions as he shall think fit;

          (v)  (SHARES): to promote, or otherwise acquire, the share capital of
               any body corporate with a view (if the Customer itself shall be a
               body corporate) to such first-mentioned body becoming a
               subsidiary of the Customer and purchasing, leasing or otherwise
               acquiring an interest in the whole or any part of the Mortgaged
               Property or carrying on any business in succession to the
               Customer or any subsidiary Customer;

                                       34
<PAGE>
 
         (vi)  (CONVEYANCE): to carry any sale, lease or other disposal of any
               land or buildings and other property assets into effect by
               conveying, transferring, assigning or leasing in the name of the
               Customer and for that purpose to enter into covenants and other
               contractual obligations in the name of and so as the Customer;

        (vii)  (FIXTURES): to sever fixtures belonging to the Customer and sell
               them apart from any other part of Mortgaged Property,

       (viii)  (LEGAL ACTION): to take or defend any such proceedings as he
               shall think fit in the name of the Customer or otherwise,
               including proceedings for the compulsory winding-up of the
               Customer;

         (ix)  (COMPROMISE): to enter into or make any such agreement,
               arrangement or compromise as he shall think fit and carry out and
               enforce specific performance or otherwise obtain the benefit of
               all contracts entered into or held by the Customer or entered
               into in exercise of the powers hereby conferred:

          (x)  (INSURANCE): to insure any such assets or liabilities as he shall
               think fit or as the Bank shall direct and to renew any
               insurances;

         (xi)  (EMPLOYEES AND AGENTS): to appoint and employ such managers,
               officers and workmen and engage such professional advisers as he
               shall think fit including without prejudice to the generality of
               the foregoing power to employ his partners and firm;

        (xii)  (RENT REVIEW): to operate any rent review clause in respect of
               any property in respect of which he was appointed or any part
               thereof and to apply for any new or extended tenancy;

       (xiii)  (TO BORROW): to raise or borrow money from the Bank or any other
               person to rank for payment in prior to the security constituted
               by this Security and with or without a mortgage or charge on the
               Mortgaged Property or any part of it;

        (xiv)  (PERFORM COVENANTS): to do all things necessary to perform or
               observe any of the covenants on the part of the Customer herein
               contained;

                                       35
<PAGE>
 
         (xv)  (INCIDENTAL POWER): to do all such other things as may seem to
               him to be incidental or conducive to other power vested in him in
               the realization of the security hereby constituted; or

        (xvi)  (DELEGATION): to delegate to any person for such time(s) as the
               Bank shall approve any of the power conferred on him.

(4)  CONSIDERATION ON SALE
     (Receiver may accept various forms of consideration)

     In making any sale or other disposal in the exercise of their respective
     powers (including a disposal to any such body corporate as is mentioned in
     this clause) a Receiver or the Bank may accept, as and by way of
     consideration for such sale or other disposal, cash, shares, loan capital
     or other obligations, including without limitation consideration
     fluctuating according to or dependent upon profit or turnover and
     consideration the amount of which is to determined by a third party.

(5)  PAYMENT BY INSTALMENTS
     (Consideration on sale may be by installments)

     Any consideration for a sale or other disposal by a Receiver or the Bank
     may be receivable in a lump sum or in installments, and upon receipt by the
     Receiver or the Bank shall by virtue of such receipt be and become
     chargeable with the payment of the Moneys Secured.

(6)  PERSONAL LIABILITY OF RECEIVER
     (Contracts may limit liability)

     Any contract for any sale or other disposal by the Receiver or the Bank may
     contain conditions excluding or restricting the personal liability of the
     Receiver or the Bank to the full extent permitted by law.

(7)  INVOLUNTARY LOSS
     (Receiver not answerable for losses)

     A Receiver shall not be answerable or accountable for any involuntary loss
     happening in or about the exercise or attempted exercise of the powers
     hereby conferred or for any more money than shall actually come to his
     hands or for the negligence, default or dishonesty of any officer, servant,
     agent or auctioneer.

(8)  AGENT OF CUSTOMER

                                       36
<PAGE>
 
     (Receiver is Customer's agent)

     Every Receiver so appointed shall be deemed at all times and for all
     purposes to be the agent of the Customer and the Customer shall be solely
     responsible for his acts and defaults and for the payment of his
     remuneration. The appointment of a Receiver shall not render or deem the
     Bank liable as a mortgagee in possession.

(9)  REMUNERATION OF RECEIVER
     (No maximum rate)

     Every Receiver so appointed shall be entitled to remuneration for his
     services at a rate to be fixed by agreement between him and the Bank (or,
     failing such agreement, to be Fixed by the Bank) appropriate to the work
     and responsibilities involved upon the basis of charging from time to time
     adopted in accordance with his current practice or the current practice of
     his firm and, to the extent that it is lawful so to provide, without being
     limited to any maximum rate specified by law.

(10) ADVANCES
     (Bank may advance moneys to Receiver)

     The Bank may at the request of a Receiver advance to the Receiver such
     moneys as the Bank thinks fit and all moneys so advanced shall be deemed
     moneys advanced on account of the Customer and form part of the Moneys
     Secured.

(11) REIMBURSEMENT
     (Costs of receivership and enforcement are Moneys Secured)

     All moneys and amounts paid or for which the Receiver or the Bank becomes
     liable in the exercise of any of the powers conferred on each of them under
     this Security or at law shall be reimbursed by the Customer on demand and
     shall form part of the Moneys Secured.

(12) MONEYS PAID TO BANK
     (Only moneys paid to Bank satisfy Moneys Secured)

     Only moneys actually paid by any such Receiver to the Bank in satisfaction
     or discharge of the Moneys Secured shall be capable of being applied by the
     Bank in satisfaction thereof.

(13) BANK'S RIGHTS
     (Bank may exercise Receivers powers)

     Notwithstanding that a Receiver may or may not have been appointed it shall
     be lawful for the Bank at any time after

                                       37
<PAGE>
 
     the Bank shall have become entitled to appoint a Receiver and without
     giving any notice to exercise all or any of the powers authorities and
     discretions which may be conferred on a Receiver under this Security.

14.  APPLICATION OF MONEYS
     (Order of application of moneys received under Security)

     All moneys received by the Bank or a Receiver under or by virtue of this
     Security shall be applied (subject to the claims of any secured and
     unsecured creditors ranking in priority to this Security) in the following
     order-

     FIRST     in or towards payment of all costs charges and expenses of and
               incidental to the appointment remuneration and removal of any
               Receiver and the exercise (including the attempted exercise) by
               the Bank or a Receiver of all or any of the powers conferred by
               this Security or by law;

     SECONDLY  in or towards payment of the Moneys Secured in such order or
               manner as the Bank in its absolute discretion sees fit;

     THIRDLY   in or towards payment of moneys owing under or in respect of
               subsequent mortgages and charges in the order of their respective
               priorities; and

     FOURTHLY  in payment of any surplus to the Customer or other person
               entitled to the Mortgaged Property;

     and any such surplus does not carry interest and shall be deemed to have
     been duly paid and the Bank shall have no further liability in respect of
     such surplus if it is paid to the credit of a suspense or impersonal
     account or an account in the name of the Customer or other person entitled
     thereto in the books of the Bank whether specially opened for the Purpose
     or otherwise and in applying any moneys in or towards payment of any of the
     Moneys Secured the Customer shall be credited only with so much moneys
     available for that purpose as has actually been received by the Bank and
     with effect from but excluding the date of receipt.

15.  POWER OF ATTORNEY

(1)  JOINT AND SEVERAL ATTORNEYS

     The Customer appoints tile following, namely -

     (a)  the Bank,

                                       38
<PAGE>
 
     (b)  each officer of the Bank,

     (c)  each and every person to whom the Bank shall from time to time have
          delegated the exercise of the power of attorney conferred by this
          Clause, and

     (d)  any Receiver appointed under this Security and for the time being
          holding office as such jointly and severally to be the attorney or
          attorneys of the Customer and in the Customer's name and otherwise on
          Customer's behalf and as the Customer's act and deed to sign, seal,
          execute, deliver, perfect and do all other instruments (including
          transfers and other instruments pursuant to the Torrens Statute), acts
          and things that may be required (or which the Bank or any Receiver
          appointed under this Security shall consider required for carrying out
          any obligation imposed on the Customer by or pursuant to this Security
          (including, without limitation, the obligations imposed on the
          Customer pursuant to Clause 5), for executing, certifying as correct
          or amending any documents to enable their registration, enforcing
          settling, compromising and discharging any claim against any insurer
          in the name of the Customer or the Bank or both and whether or not the
          insurance covers other property as well as the Mortgaged Property, for
          conveying or transferring any legal or other title or interest in land
          and carrying any sale, lease or other dealing by the Bank or such
          Receiver into effect getting in the Mortgaged Property, for
          instituting proceedings with or defending any legal proceeding
          (including arbitration) on behalf of the Customer in connection with
          this Security or the Mortgaged Property and for executing and
          appealing from judgments, and generally for enabling the Bank and the
          Receiver to exercise the respective powers conferred on them by this
          Security or by law.

(2)  BANK'S POWERS
     (Delegation not to preclude Bank's powers)

     The Bank shall have full power to delegate the power conferred on it by
     this Clause, but no such delegation by Bank to any person shall preclude
     the subsequent exercise of such power by the Bank itself or any subsequent
     delegation thereof by the Bank to any other person and the Bank may revoke
     any such delegation at any time.

(3)  RATIFICATION BY CUSTOMER
     (Customer to ratify acts of attorneys)

     The Customer shall ratify and confirm all transactions entered into by the
     Bank, any officer of the Bank, any delegate of the

                                       39
<PAGE>
 
     Bank or such Receiver in the exercise or purported exercise of the Bank's
     or such officer of the Bank or such delegate's or such Receiver's
     respective powers and all transactions entered into, documents executed
     things done by the Bank or such officer of the Bank or such delegate or
     such Receiver by virtue of the power of attorney given by this Clause.

(4)  IRREVOCABILITY
     (Power of attorney irrevocable)

     The power of attorney hereby granted is as regards the Bank. each officer
     of the Bank, its delegates and any  Receiver (and as the Customer hereby
     acknowledges) granted irrevocably and for value as part of the  constituted
     by this Security to secure the proprietary interest of and the performance
     of obligations owed to  Bank.

16.  PROTECTION OF PURCHASERS
     (Purchasers not bound to inquire)

     No purchaser, or other person dealing with the Bank or its delegate or any
     Receiver appointed hereunder shall  bound to see or inquire whether the
     right of the Bank or such Receiver to exercise any of its or his powers has
     or has become exercisable or be concerned with any notice to the contrary
     or be concerned to see whether  delegation by the Bank shall have lapsed
     for any reason or been revoked and need not enquire as to the application
     of any moneys paid to the Bank, any officer of the Bank, its delegate or a
     Receiver and the receipt of the Bank, officer of the Bank, its delegate or
     a Receiver is a good discharge on behalf of the Customer.

17.  EFFECTIVENESS OF SECURITY

(1)  OTHER SECURITY
     (Not affected by nor to affect other security)

     This Security is in addition to and does not prejudice, nor is it
     prejudiced by, any other security which the Bank  at any time hold for any
     of the Moneys Secured, and no other security held by the Bank over the
     whole or any  of the Mortgaged Property is extinguished, postponed,
     lessened or otherwise prejudicially affected by this Security  or merges in
     this Security.

(2)  CONTINUITY

     (Obligations remain in force notwithstanding discharge of Mortgaged
     Property)

                                       40
<PAGE>
 
     This security shall remain in full force and effect as a continuing
     security until discharged by the Bank. The Customer is not entitled to a
     discharge of this Security at a time when there are, or it is reasonably
     foreseeable that there are likely to be any moneys or amounts which fall
     within the description of the Moneys Secured. The Bank may at any time in
     its absolute discretion discharge the whole or any part of the Mortgaged
     Property from the operation of this Security but such discharge shall not
     relieve the Customer from the obligation to pay any moneys or amounts which
     fall with the description of the Moneys Secured which may be outstanding at
     the time of such discharge or in the future.

(3)  BILLS AND OTHER SECURITY
     (Not to affect bills or other securities)

     Nothing contained in this Security or in any other security or Security
     Instruments now or in the future held or taken by the Bank as security for
     the payment of the Moneys Secured or any of them is intended to or shall
     operate so as to, prejudice or affect any Security Instrument, bill, note,
     mortgage, pledge, charge or other security of any kind whatsoever which the
     Bank may have for the Moneys Secured or any of them or any right, remedy or
     privilege of the Bank under any of them.

(4)  BANKRUPTCY OR INSOLVENCY CLAIMS
     (Void or voidable payments not to discharge liability of Customer)

     Notwithstanding any discharge or partial discharge by the Bank of this
     Security, if in relation to any payment made to the Bank of any sum of
     money by or on behalf or on account of the Customer a claim is made by any
     person under or by virtue of any law relating to bankruptcy or the
     protection of creditors to the effect that the payment is void or voidable
     and that claim is upheld by a court or is conceded or compromised by the
     Bank in its unfettered discretion and without notice to the Customer then -

     (a)  (NO DISCHARGE): that payment (or such part of that payment as is
          payable under the claim as so upheld. conceded or compromised) shall
          be deemed not to have discharged a liability of the Customer under
          this Security for its payment, and as between the Customer and the
          Bank the payment to the Bank shall be deemed never to have been made;

     (b)  (RESTORATION OF SECURITY): where such a claim is upheld. conceded or
          compromised the Customer shall, if required by the Bank, restore to
          the Bank any security held by it from the Customer immediately prior
          to such discharge or

                                       41
<PAGE>
 
          partial discharge and in addition to the other moneys recoverable by
          the Bank under this Security the Customer shall be liable to pay to
          the Bank on demand all costs and expenses whatsoever (including legal
          costs and expenses as between solicitor and own client) incurred by
          the Bank in or in connection with any negotiations or proceedings
          relating to any such claim; and

     (c)  (AUTHORITY TO DEBIT ACCOUNT): the Bank may debit any account of the
          Customer in the books of the Bank or any account of which the Customer
          may be one of the proprietors with any sum which the Bank in its
          opinion may be or become liable to pay as a consequence of any such
          payment being void or voidable or any claim, being conceded or
          compromised and the amount of any such debit shall be binding on the
          Customer and shall form part of the Moneys Secured.

(5)  CONTINGENT LIABILITIES
     (Payment of maximum amount of contingent liability to trustee)

     Where this Security purports to make an amount payable on demand or refers
     to payment to the Bank of moneys which include an amount and in either case
     that amount represents a contingent or prospective liability or any other
     liability that cannot be quantified or may not become payable -

     (a)  (SELECTION OF TRUSTEE): the Customer (with the prior written consent
          of the Bank), the Bank or a Receiver (as the case may be) may select a
          trustee approved by the Bank;

     (b)  (CONSENT): the Bank shall not unreasonably refrain from giving its
          consent to selecting or from approving a proposed trustee selected by
          the Customer or a Receiver;

     (c)  (PAYMENT TO TRUSTEE): the Customer, the Bank or the Receiver (as the
          case may be) may pay to the trustee a fund equal to the maximum amount
          of the contingent, prospective, unquantifiable or uncertain liability
          that is reasonably foreseeable at the time of payment;

     (d)  (DISCHARGE): subject to Clause 17(4) and to Clause 17(5)(c), payment
          to the trustee operates as a complete discharge to the Customer in
          respect of that liability, and

     (e)  (SATISFACTION OF LIABILITY): the trustee shall hold the fund on trust
          to satisfy the liability from time to time out of the fund and to pay
          the balance (if any) when the 

                                       42
<PAGE>
 
          liability has ceased or been satisfied in the same manner as is
          provided in Clause 14.

18.  REMEDIES, TIME OR INDULGENCE

(1)  CUMULATIVE RIGHTS
     (Additional to other rights)

     The rights, powers and remedies provided by this Security to the Bank are
     cumulative and are not, nor are they to be construed as, exclusive of any
     rights, powers and remedies provided by law.

(2)  FAILURE TO EXERCISE RIGHTS
     (No waiver)

     No failure of the Bank to exercise, or delay by the Bank in exercising, any
     of the rights (including, but not limited to the right to make demand),
     powers, discretions and remedies provided by this Security or by law
     (collectively the "Bank's Rights") shall operate as a waiver of any of
     them, nor shall any single or partial waiver of any of the Bank's Rights
     preclude any further or other exercise of that one of the Bank's Rights
     concerned or the exercise of any of the Bank's Rights.

(3)  WAIVER IN WRITING
     (Writing required for waivers)

     Any waiver or consent by the Bank under this Security is effective only if
     in writing signed by the Bank or an  of the Bank and then only to the
     extent expressly stated in such writing.

(4)  NOTICE OF THIS SECURITY NOT REQUIRED
     (Bank not bound to notify others of Security)

     It shall not be incumbent on the Bank to give notice of this Security to
     any person nor to exercise any power or authority contained or implied in
     this Security or vested in the Bank under this Security or by law nor shall
     Bank be answerable or accountable for any loss occasioned by its omission
     or delay so to do or for any loss happening in or about or occasioned by
     the exercise or execution or a partial or attempted exercise or execution
     of any power or right or authority or any trust connected therewith nor for
     any other involuntary loss howsoever the same may be incurred (and whether
     through negligence or otherwise).

19.  ACCOUNTS

                                       43
<PAGE>
 
(1)  NEW ACCOUNT
     (Opening up a new account on subsequent charge)

     If the Bank at any time receives notice of any subsequent mortgage,
     assignment, charge or other interest affecting the whole or any part of the
     Mortgaged Property, the Bank shall be entitled to open a new account or
     account for the Customer in its books and if the Bank does not in fact do
     so then (unless the Bank gives express written notification to the Customer
     that it has not done so) as from the time when the Bank received such
     notice all payments made by the Customer to the Bank shall (in the absence
     of any express appropriation to the contrary by the Customer to have
     treated as having been credited to such new account of the Customer and not
     as having been applied in reduction of the Moneys Secured outstanding at
     the time of receipt of such notice by the Bank.

(2)  SUSPENSE ACCOUNT
     (Moneys may be credited to suspense account)

     All moneys received, recovered or realized by the Bank under or pursuant to
     this Security (including the provision of any conversion of currency) may
     be credited, at the discretion of the Bank to any suspense or impersonal
     account and may be held in such account for so long as the Bank thinks fit
     (with interest accruing thereon at such rate as the Bank considers fit)
     pending their application at such time or times as the Bank may decide in
     the discharge of Moneys Secured or any of them.

(3)  COMBINING ACCOUNTS
     (Bank may combine accounts)

     If the Customer has two or more accounts with the Bank, the Bank may at any
     time without notice to any person combine any such two or more accounts of
     the Customer with the Bank.

(4)  SET-OFF
     (Bank has right of set-off)

     The Bank may set off or transfer any sum standing to the credit of any one
     or more accounts with the Bank of the Customer or any person liable jointly
     with the Customer in or towards satisfaction of any of the Liabilities of
     the Customer to the Bank on any other account or in any other respect.

(5)  BANK'S RIOTS
     (Bank's rights are exercisable notwithstanding previous dealings or this
     Security)

                                       44
<PAGE>
 
     The Bank's rights under this Clause shall exist and be exercisable whether
     or not the Bank has agreed to permit a   set-off for the purpose of
     calculation of interest between any two or more accounts and
     notwithstanding any course of dealing between the Customer and the Bank and
     notwithstanding anything in this Security or that the Money Secured may be
     or may be expressed to be advanced on any specified account or on two or
     more accounts or that the accounts are with different branches of the Bank
     of that any one account or more stand in credit.

(6)  BANK MAY TREAT COMBINED ACCOUNTS AS ONE
     (Bank may decline to honour outstanding instruments)

     Upon a combination of accounts the Bank may decline to pay any cheque or
     other order or instrument, make advances or meet any obligations to for or
     for the accommodation of or on behalf of the Customer as if the combine
     accounts had at all times been conducted as a single account.

(7)  LIABILITIES
     (All types of liabilities covered)

     The liabilities referred to in this Clause may be actual, contingent,
     prospective, primary, collateral, several or joint liabilities, and the
     accounts, sums, and liabilities referred to in this Clause may be
     denominated in any one or more currencies.

20.  CURRENCY CONVERSION AND EXCHANGE RISK

(1)  CURRENCY CONVERSION
     (Bank may convert any sum into another currency)

     Where it is accessary pursuant to this Security or where in the Bank's
     opinion it is necessary or desirable for any purpose connected with or
     arising out of this Security to convert a sum of money expressed in one
     currency ("First Currency") into a sum expressed in another currency
     ("Second Currency") the rate of conversion to be used will be the rate at
     which the Bank would have been able to purchase the Second Currency with
     the First Currency on the date of conversion for value the same day in the
     market for foreign currency in Sydney including any premium.

(2)  EXCHANGE RISK
     (Customer indemnifies Bank against exchange risk)

     If any sum due from the Customer under this Security or any order or
     judgment given or made in relation to this Security has to be converted
     from one currency ("First Currency") into another currency ("Second
     Currency") for the purposes of:

                                       45
<PAGE>
 
     (a)  making or Ming a claim or proof against the Customer;

     (b)  obtaining an order or judgment in any court or other tribunal; or

     (c)  enforcing any order or judgment given or made in relation to this
          Security;

     the Customer shall, indemnify and hold harmless the Bank from and against
     any loss suffered as a result of any discrepancy between:

     (d)  the rate of exchange used for such purpose to convert the sum from the
          First Currency into the Second Currency, and

     (e)  the rate of exchange determined in accordance with Clause 20(1) of
          this Security to convert the sum from the First Currency into the
          Second Currency on the date of receipt of a sum paid to it in
          satisfaction, in whole or in part, of any such order, judgment, claim
          or proof.

(3)  INDEPENDENT OBLIGATION
     (Indemnity given is independent obligation)

     The indemnity in Clause 20(2) of this Security constitutes a separate and
     independent obligation of the Customer, applies irrespective of any time,
     waiver or other indulgence granted by the Bank, and survives the
     termination of this Security.

(4)  EXTENT OF ANY DISCHARGE
     (No discharge except to extent of currency purchased)

     The purported payment of any Moneys Secured in a currency other than the
     currency in which those Moneys Secured are agreed to be due and payable
     shall not discharge such Moneys Secured except to the extent of the amount
     of the currency agreed to be due and payable which the Bank actually
     receives as a result of the purchase of the currency agreed to be due and
     payable with the amount of the currency received by the Bank.

21.  NOTICES

(1)  SIGNATURE OF NOTICES
     (Officer of Bank or solicitor may sign)

     Any notice, certificate or demand which the Bank desires or is required to
     give to or make upon the Customer for any purpose in connection with this
     Security may be signed for and on behalf of the Bank by any officer of the
     Bank or by any solicitor for the time being acting for the Bank, whose

                                       46
<PAGE>
 
     signature may be handwritten or printed or otherwise reproduced by
     mechanical means.

(2)  SERVICE
     (Additional methods of service)

     In addition to the sufficient methods of service provided for by statute
     any notice, certificate or demand by the Bank shall be deemed to be duly
     given to or made upon the Customer if:-

     (a)  left for the Customer, or sent by prepaid post or by telex, lettergram
          (telegram) or facsimile transmission to the Customer, at:

          (i)  its address set forth herein;

         (ii)  the Customers registered office or any one of its principal
               places of business in any State or Territory of the Commonwealth
               of Australia or elsewhere; or

        (iii)  any premises owned or occupied by the Customer,

     (b)  delivered personally to any officer of the Customer or

     (c)  advertised in the government gazette of the state, country or place in
          which this Security is executed by the Customer.

(3)  VALIDITY OF SERVICE
     (Due service)

     Any such method of service shall be valid, effectual and sufficient
     notwithstanding that:-

     (a)  at the date of service the Customer may be insolvent, or should be in
          receivership or liquidation or provisional liquidation), whether
          voluntary or compulsory, or under official management;

     (b)  The Customer shall not receive or read such notice, certificate or
          demand; or

     (c)  where such notice, certificate or demand is sent by post or lettergram
          (telegram) it is returned to Bank through the post office unclaimed;

     and notwithstanding any other matter or event whatsoever.

(4)  DEEMED RECEIPT
     (When received)

                                       47
<PAGE>
 
     Any such notice, certificate or demand shall be deemed to have been
     received by the Customer:-

     (a)  if left or delivered personally, on the same day;

     (b)  if sent by post, on the second business day (in the place to which it
          is addressed) after the date of posting

     (c)  if sent by telex, upon receipt of the Customer's answerback code;

     (d)  if sent by lettergram (telegram), on the next business day (in the
          place to which it is addressed) after dispatch

     (e)  if sent by facsimile transmission, upon despatch: and

     (f)  if advertised, on the date of publication of the relevant gazette.

(5)  CERTIFICATES
     (Certification of service)

     A certificate signed by an officer of the Bank or by any solicitor for the
     time being acting for the Bank as to time and manner of giving or making
     such notice, certificate or demand shall be conclusive evidence thereof.

(6)  DEEMED SERVICE
     (Where two or more persons as the Customer)

     Where more than one person is named as the Customer, any demand,
     certificate or notice served on one of them (or deemed to have been so
     served) shall be regarded as effectively served on the other or others of
     them.

22.  DEALINGS WITH PRIOR MORTGAGEES

(1)  PRIOR MORTGAGES
     (Sale may be subject to or discharged from prior mortgages)

     Any sale by the Bank or a Receiver appointed hereunder may be made either
     subject to or discharged from any prior mortgage or other security and the
     Bank or such Receiver may settle and pass the accounts of any person in the
     prior mortgage or other security may for the time being be vested.

(2)  CUSTOMER BOUND BY SETTLED ACCOUNTS

     Any account so settled and passed shall as between the Bank (or, as the
     case may be, the Receiver) on the one hand and the

                                       48
<PAGE>
 
     Customer on the other hand be deemed to be properly settled and passed and
     shall be binding on the Customer accordingly.

(3)  REDEMPTION OF PRIOR MORTGAGES
     (Bank may redeem or pay out prior mortgage)

     If any person or persons entitled to the benefit of any prior mortgage or
     other security ranking in point of security in priority to this Security
     shall call in the moneys thereby secured or shall take any step to enforce
     the same the Bank may thereupon, by agreement or in exercise of its
     statutory power, either redeem such mortgage or other security or make
     payment of such moneys and take a transfer of the benefit thereof, and the
     money so expended by the Bank (including all costs of and incidental to any
     such transaction) shall be reimbursed by the Customer to Bank on demand and
     shall (but only if the Bank shall so elect in a case where the Bank has
     taken such a transfer so secured hereby and be added to and form part of
     the Moneys Secured. The Customer will upon the written request of the Bank
     made at any time execute in favour of the Bank and at the cost of the
     Customer all such deeds or other documents as the Bank may require in order
     to have any mortgage or security transferred to the Bank pursuant to this
     Clause 22(3) registered or for more perfectly assuring or securing the
     property secured thereby in favour of the Bank. The Customer authorises the
     Bank to complete any mortgage or security transferred to the Bank pursuant
     to this Clause 22(3) by filling in blanks and correcting mistakes in order
     to make it conform to the contractual intention of the parties or to supply
     immaterial deficiencies, and in particular, to insert details of any dates
     or amounts left blank when the Customer executed it and to certify as
     correct for the purpose of registration in respect of any registering
     authority.

23.  PROVISIONS SEVERABLE
     (Power to sever)

     Each of the provisions contained in this Security shall be severable and
     distinct from one another and if at any time any one or more such
     provisions is or becomes invalid, illegal or unenforceable, the validity,
     legality and enforceability of each of the remaining provisions of this
     Security shall not in any way be affected, prejudiced or impaired thereby.

24.  THE BANK'S DISCRETIONS

(1)  NO OBLIGATION TO EXERCISE RIGHTS
     (Bank under no obligation to exercise rights)

     Any power, remedy, right or privilege which may be exercised or any
     determination which may be made hereunder by the Bank

                                       49
<PAGE>
 
     may be exercised or made or declined to be exercised or made in the
     absolute and unfettered discretion of the Bank. The Bank shall not be under
     any obligation to do so or to give reasons therefor and the Bank is not
     liable or accountable for any loss occasioned by or arising out of or in
     connection with its omission to exercise any power right or authority or to
     make any determination or any delay in exercising any power right or
     authority or making any determination or the exercise or partial exercise
     of any power, right or authority or the performance of any trust connected
     therewith.

(2)  OTHER SECURITY
     (Bank not under obligation to resort to other security)

     The Bank is not under any obligation to resort to any other security or
     guarantee it may hold for the Moneys Secured or any part thereof in
     priority to this Security or any other security and, subject to the
     mandatory requirements of any applicable law, the Customer may not require
     the Bank to marshall or consolidate this Security with any other security
     or any other security with this Security.

(3)  NEGOTIABLE INSTRUMENTS
     (Bank may make demand notwithstanding bills are outstanding)

     The Bank may make demand under this Security notwithstanding the currency
     of a negotiable instrument and any demand made under this Security may
     include the amount of any bills of exchange, promissory notes or other
     negotiable instruments in respect of which the Customer may be liable to
     the Bank notwithstanding that those instruments may not then have matured.

(4)  MEETINGS OF CUSTOMER
     (Officer of Bank may attend meetings)

     The Bank, through any officer of the Bank, may attend all meetings of the
     directors of the Customer and all general meetings of the Customer and may
     speak at those meetings, if the officer of the Bank thinks fit and, if
     required by the Bank, the Customer will procure its articles of association
     to be amended to give effect to this Clause.

25.  ASSIGNMENT

(1)  BANK'S RIGHT OF ASSIGNMENT
     (Bank may assign Security)

     The Bank shall have a full and unfettered right to assign the whole or any
     part of the benefit of this Security free of any equity, set-off or
     counterclaim and the expression the "Bank"

                                       50
<PAGE>
 
     wherever used in this Security shall be deemed to include the assignees and
     other successors, whether immediate or derivative, of the Bank, who shall
     be entitled to enforce and proceed upon this Security in the same manner as
     if named as the Bank under this Security.

(2)  BANK'S RIGHT TO GIVE INFORMATION
     (Bank may inform assignee)

     The Bank shall be entitled to impart any information concerning the
     Customer to any such assignee or other successor or proposed assignee or
     successor as well as to any body corporate which is a related body
     corporate of the Bank within the meaning of the Corporations Law (or which
     would be so related if it applied to determine the question).

26.  CUSTOMER AS SURETY

     The following provisions of this Clause apply where the liability of the
     Customer to the Bank is that of surety for the obligations of another
     person or persons (each a "Principal Debtor"):

(1)  LIABILITY OF CUSTOMER
     (Liability of Customer not to be affected by variation in principal
     liability)

     The liability of the Customer hereunder shall not be impaired, released,
     discharged or otherwise affected by any act, event or omission which might
     otherwise have that effect at law or in equity including without limiting
     the generality of the foregoing, any one or more of the following -

     (a)  (VARIATION OF FACILITY): any determination, variation or increase by
          the Bank of any credit or facilities to any Principal Debtor; or

     (b)  (GRANT OF TIME): the grant by the Bank to any Principal Debtor or any
          other person of any time, credit, indulgence or concession; or

     (c)  (DEALINGS WITH SECURITIES): any dealing with, or exchange, renewal,
          variation, release, or modification, abstention from perfecting or
          enforcing any securities or rights which the Bank may now or hereafter
          acquire with respect of the Moneys Secured; or

     (d)  (RENEWAL OF BILLS): the renewal by the Bank of any bills, promissory
          notes or other negotiable instruments or Security Instruments: or

                                       51
<PAGE>
 
     (e)  (DEALINGS WITH OTHER SECURITIES): any compounding, compromise.
          discharge. release, abandonment, variation, relinquishment, renewal or
          transfer in whole or part of, or other dealing with this Security or
          Security Instruments or of the indebtedness or liabilities of any
          Principal Debtor or other person or guarantor to the Bank or by any
          neglect or omission of the Bank to enforce any of its rights against
          any of them; or

     (f)  (ABSTINENCE FROM CLAIM): the Bank's abstaining from proving or
          maintaining any right or proof or from enforcing payment of any
          dividend or composition; or

     (g)  (FAILURE TO OBTAIN OTHER SECURITY): the Bank's obtaining or failure to
          obtain any other guarantee (whether contemporaneously with this
          Security or otherwise) or the failure or refusal of any person to
          provide other security, or

     (h)  (APPLICATION OF ADVANCES): the Bank's agreeing with any Principal
          Debtor at any time as to the applicability if any advances or other
          accommodation; or

     (i)  (DEATH OR BANKRUPTCY): the death, incapacity, official management,
          liquidation, receivership, bankruptcy, or insolvency of any Principal
          Debtor any guarantor, co-surety or any other person; or

     (j)  (COMPOSITION): the Bank becoming a party to or bound by any compromise
          or assignment of property or arrangement or composition of debts or
          scheme of reconstruction by or relating to any Principal Debtor in any
          capacity, any guarantor, co-surety or any other person; or

     (k)  (DEFECTIVE SECURITY): any security held or taken at any time by the
          Bank being void. defective or inform; or

     (l)  (LOSS OF SECURITY): any property the subject of a security being
          forfeited, extinguished, surrendered, or determined.

(2)  SEVERAL CUSTOMERS
     (Discharge of one Customer not to affect liability of others)

     Where two or more persons are named in this Security as the Customer no
     release, discharge, composition or arrangement between the Bank and any one
     or more of those persons shall release or discharge, or prejudice, or
     otherwise affect, the Bank's right and remedies hereunder against any other
     of those persons.

                                       52
<PAGE>
 
(3)  CUSTOMER'S CLAIMS
     (Customer not to make claims unless Moneys Secured paid in full)

     Until the Moneys Secured have been paid or discharged in full and the Bank
     is satisfied that it will not be under liability to repay any of them on
     the ground of preference or otherwise and notwithstanding any payment of
     money recoverable from the Customer under this Security or any purported
     release or cancellation of this Security the Customer will not by virtue of
     such payment or by any other means or on any other ground, except with the
     prior written consent of the Bank or as provided below -

     (a)  claim any set-off or assert any counterclaim against any Principal
          Debtor in relation to any liability of Customer to that Principal
          Debtor, or

     (b)  make or enforce any claim or right against any Principal Debtor or
          prove in competition with the Bank, in respect of any payment
          hereunder made by the Customer or otherwise; or

     (c)  be entitled to claim or have the benefit of, any set-off, counterclaim
          or proof against, or dividend, compos or payment by, any Principal
          Debtor or any Principal Debtor's estate; or

     (d)  be entitled to claim or otherwise obtain the benefit of any security
          or guarantee or indemnity at any time by the Bank for or in respect of
          any of the Moneys Secured or be entitled to assert against the Bank
          any of subrogation in respect of any moneys paid to the Bank; or

     (e)  claim or enforce any right of contribution against any co-surety.

(4)  BANKRUPTCY OR WINDING-UP OF PRINCIPAL DEBTOR
     (Customer to exercise rights if required by Bank)

     If the Customer shall have any right of proof in the bankruptcy or winding-
     up of any Principal Debtor which will not derive from a payment made
     hereunder, the Customer shall (except where the Bank otherwise requires)
     exercise that right and shall (except as aforesaid) claim any related right
     of contribution from any co-surety.

(5)  PAYMENT IN GROSS
     (All payments received by the Bank deemed to be payments in gross)

                                       53
<PAGE>
 
     All moneys from time to time received by the Bank in reduction of the
     indebtedness of any Principal Debtor to Bank or from any co-surety shall be
     regarded as payment in gross without any right on the part of the Customer
     stand in place of the Bank in respect of or to claim the benefit of any
     moneys so received as against any Principal Debtor until the whole of the
     indebtedness of that Principal Debtor has been paid or satisfied and so
     that in the event of the Customer going into liquidation, official
     management or bankruptcy, the Bank shall be entitled to prove the total
     indebtedness of that Principal Debtor in relation to the Moneys Secured
     (including for all moneys which the Customer has paid hereunder) and to
     retain and carry to a suspense account and appropriate at the discretion of
     the Bank any amounts received until the Bank has been paid one hundred
     cents in the dollar in respect of the Moneys Secured.

(6)  MONEYS RECEIVED BY CUSTOMER
     (Moneys or property received by Customer to be held in trust for Bank)

     If while the Customer shall remain under any liability to the Bank under
     this Security any moneys or other property or assets shad be received by
     the Customer in consequence of anything done with the consent of the Bank
     or in pursuance of any of the other provisions of this Clause or in breach
     of any such provisions, such moneys, other property or assets shall be held
     upon trust to pay or transfer the same to the Bank to the extent of such
     liability.

(7)  REFERENCE TO DEBTOR
     (Extension of "Moneys Secured")

     Each reference to the Customer in paragraphs 2(1)(a), (b), (c), (d), (c),
     (f) and (g) and in Clause 3, shall also be read as a reference to each
     Principal Debtor.

27.  CUSTOMER AS TRUSTEE
     (Certain provisions to apply if Customer is trustee)

(1)  APPLICABILITY

     The following provisions of this clause apply if the Customer gives this
     Security as trustee of the Trust.

(2)  UNDERTAKINGS BY CUSTOMER

     The Customer:

                                       54
<PAGE>
 
     (a)  (BINDING SECURITY): acknowledges and agrees that this Security is
          binding on it personally and in its capacity as trustee of the Trust,

     (b)  (SUCCESSOR TRUSTEE): shall cause any successor of the Customer as
          trustee of the Trust to execute such documents as the Bank may require
          to ensure that this Security is binding on such successor, and

     (c)  (RIGHT OF INDEMNITY): upon the floating charge created by this
          Security becoming a fixed charge and on demand by the Bank, shad
          exercise its rights of indemnity in relation to the Trust Fund and its
          rights against the beneficiaries to cause payment of the Moneys
          Secured to the Bank or otherwise hold such rights for the Bank.

(3)  REPRESENTATIONS AND WARRANTIES

     The Customer represents and warrants in respect of each Trust that:

     (a)  (SOLE TRUSTEE): the Customer is the sole trustee of the Trust and no
          action has been taken to remove or replace it;

     (b)  (PARTICULARS): full particulars of the terms of the Trust have been
          disclosed to the Bank prior to the execution of this Security;

     (c)  (TRUST DOCUMENTS): the copies of the Trust Deed constituting the Trust
          and any other documents relating to the Trust and the Memorandum and
          Articles of Association of the Customer delivered to the Bank before
          the Customer executed this Security are true copies of those documents
          as in force at the date of this Security;

     (d)  (POWER): the Customer has power under the Trust Deed to execute and
          perform its obligation under this Security, and all necessary action
          has been taken to authorises the execution and performance of this
          Security under the Trust Deed and the Memorandum and Articles of the
          Customer;

     (e)  (BENEFIT): this Security is executed and all transactions secured by
          this Security are or will be entered into as part of the due and
          proper administration of the Trust and are or will be for the benefit
          of the beneficiaries;

                                       55
<PAGE>
 
     (f)  (RIGHT OF INDEMNITY): the Customer has a right to be fully indemnified
          out of the Trust Fund and no action has been taken to restrict or
          limit that right;

     (g)  (DEFAULT): the Customer is not in default under the Trust Deed; and

     (h)  (VESTING DATE): no vesting date for the Trust Fund has been
          determined,

     and further warrants that each of the above warranties will remain true as
     long as this Security remains in force.

(4)  BENEFICIARIES' CLAIMS

     The Banks rights under this Security shall rank in priority to the claims
     of beneficiaries to the Trust Fund.

(5)  DISTRIBUTION OF INCOME
     (Distribution of income allowed)

     Nothing in this clause shall prevent the Customer from distributing the
     income (but not the capital) of the Trust Fund in accordance with the Trust
     Deed until the Bank by written notice directs the Customer not to make such
     distributions or until this Security becomes immediately enforceable,
     whichever occurs first.

(6)  NEGATIVE COVENANTS

     Except with the prior written consent of the Bank:

     (a)  the Trust Deed shad not be altered;

     (b)  the Customer shall not retire as trustee of the Trust. nor shall any
          new or additional trustee be appointed; and

     (c)  the Customer shall not default in its duties as trustee of the Trust.

(7)  SUCCESSORS

     In this Security references to the Customer include the Customer's
     successors as trustee of the Trust.

28.  PARTNERSHIP
     (Security not to be affected by changes in partnership)

     Where this Security is given in respect of the indebtedness of a
     partnership this Security shall continue to notwithstanding

                                       56
<PAGE>
 
     any changes which may from time to time take place in the constitution of
     the part notwithstanding that the partnership ceases to carry on business,
     and shall continue to bind the notwithstanding that the Customer is not a
     member of the partnership or having once been a partnership the Customer is
     no longer a member thereof.

29.  RESUMPTION

(1)  CLAIM FOR COMPENSATION
     (Bank entitled to claim compensation)

     If the Mortgaged Property or any part thereof is or is proposed to be
     resumed or acquired by the government or public authority or the use to
     which the Mortgaged Property or any part thereof may lawfully be put is or
     to be altered the Customer shall notify the Bank forthwith and, if
     requested by the Bank, shall at the  expense claim or join with the Bank in
     making claim for all or any moneys which may become payable purchase money
     or compensation or otherwise in respect of the Mortgaged Property and in
     making app consent or permission to use the Mortgaged Property for such
     purposes as the Bank may think appropriate.

(2)  COMPROMISE OR SETTLEMENT
     (Bank to approve compromise or settlement)

     The Customer shall not without the consent and approval in writing of the
     Bank compromise agree or the purchase money or compensation or any
     proportion thereof payable in respect of any such acquisition or execute
     any releases therefor notwithstanding anything in any statute under which
     any purchase money or compensation may be payable.

(3)  COMPENSATION RECEIVED
     (Customer to hold compensation in trust for Bank)

     If the Customer receives any purchase moneys or compensation as a result of
     any exercise by any government or any public authority of any power under
     any law or by reason of or as a result of some right to receive or purchase
     moneys having arisen, then such moneys shall be held by the Customer on
     trust for the application in or towards payment of the Moneys Secured and
     shall be paid to the Bank forthwith upon.

30.  MORATORIUM
     (Moratorium laws do not apply)

     Any existing or future moratorium legislation or regulations shall have no
     application to this Security or to the Secured and such legislation and
     regulations, are hereby expressly

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     excluded from applying to this Security Moneys Secured to the full extent
     permitted by law.

31.  COVENANT FOR TITLE AND OTHER REPRESENTATIONS AND WARRANTIES

(1)  GOOD TITLE

     The Customer covenants that it has good right, title and authority to
     charge the Mortgaged Property in the contemplated by this Security free of
     any encumbrance except any Permitted Prior Charge.

(2)  REPRESENTATIONS AND WARRANTIES

     The Customer represents and warrants that:

     (a)  (POWER): the Customer has power to enter into and observe its
          obligations under this Security,

     (b)  (AUTHORISATIONS): the Customer has the reports and evaluations and has
          in full force and effect and authorisations necessary to enter into
          this Security, observe obligations under it, allow it to be enforce
          enable the Customer to carry on any undertaking or activity
          contemplated by any purpose agreed by to be the purpose for which the
          Moneys Secured are provided.

     (c)  (ENFORCEABILITY): the Customer's obligations under this Security are
          valid, binding and are enforceable it in accordance with its terms;

     (d)  (CONSTITUENT DOCUMENTS): this Security and the transactions under it
          do not contravene the Customer constituent documents or any law,
          regulation or official directive or any of the obligations or
          undertaking which the Customer or any assets of the Customer are bound
          or cause a limitation on the Customer's or the powers of its directors
          to be exceeded;

     (c)  (DISCLOSURE): the Customer has fully disclosed in writing to the Bank
          all facts relating to the Customer, this Security, the Mortgaged
          Property and anything in connection with them which are material to
          the assessment of the nature and amount of the risk undertaken by the
          Bank in providing any of the Moneys Secured or accepting this Security
          as security for doing so or which are material to establishing the
          form of any notifications to be lodged in any official register in
          connection with this Security or the Mortgage Property;

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<PAGE>
 
     (f)  (EVENTS OF DEFAULT): no event mentioned in Clause 3 has occurred which
          continues to be unremedied; and

     (g)  (MATERIAL DEFAULT): to the best of the knowledge information and
          belief of the Customer, the Customer is not in material default under
          any material agreement binding on the Customer and no action, suit,
          proceedings, litigation or administrative proceeding before any court,
          board or arbitration or administrative body is presently in course or
          pending or threatened which would have a material adverse effect on
          the business, assets or financial condition of the Customer or which
          brings into question the validity of this Security or the Bank's right
          to recover any of the Moneys Secured,

     and the Customer covenants that each of these representations and
     warranties is true and correct at the date of execution by the Customer of
     this Security

32.  BANKING DAYS
     (Payments to be on Banking Days)

     When any day specified in this Security or in any notice or demand made
     under or in relation to this Security for the payment of any moneys or the
     performance of any act is not a Banking Day the payment shall be made or
     the act performed on the Banking Day next preceding that day.

33.  PAYMENTS FREE OF DEDUCTION
     (All payments to be free of deductions or to be grossed up)

(1)  NO DEDUCTIONS

     All payments to be made under this Security shall be made free and clear of
     and without deduction for taxes, levies, imposts, duties, charges, fees or
     withholdings of any nature whatsoever now or hereafter imposed by any
     governmental, fiscal or other authority.

(2)  GROSS-UP

     If the Customer shall at any time be compelled by law to deduct or withhold
     any amount from any payment to be made under this Security the Customer
     will concurrently pay to the Bank such additional amounts as will result in
     payment to the Bank of the full amount which would have been received if
     such deduction or withholding had not been made. If due to any statutory
     provision the Customer is not obliged to pay such additional amounts, the
     Customer shall not be obliged to pay them under this Security but the Bank
     may then demand payment

                                       59
<PAGE>
 
     of the Moneys Secured as if such non-payment were an event mentioned in
     Clause 3.

34.  LAW AND JURISDICTION
     (See Schedule for law and jurisdiction)

     This Security shall be governed by and construed in accordance with the
     laws of the place named in Item 4 of the Schedule and the Customer hereby
     irrevocably submits to the non-exclusive jurisdiction of the courts of that
     place.

35.  PRIORITY AMOUNT
     (Maximum prospective liability specified in Schedule)

     For the purpose only of Fixing priorities in accordance with Section 282 of
     the Corporations Law between this Security and any other charge given by
     the Customer and without affecting any obligation of the Customer under
     this Security, the prospective liabilities secured by this Security
     include, without limitation, the prospective liabilities identified in
     paragraph (1) of Item 3 of the Schedule and the maximum prospective
     liability secured by this Security is the amount specified in paragraph (2)
     of Item 3 of the Schedule.

36.  SUSPENSION OF CHARGE

(1)  SUSPENSION
     (Suspension because of conditional prohibition by law)

     If, without any consent, approval, notification or condition or other
     required action being obtained, made, satisfied or carried out, a law
     prohibits any property or asset of the Customer from being charged or
     provides that if such property or asset is charged, this Security is void,
     voidable or unenforceable:

     (a)  this Security shall not operate to charge any such property or asset
          of the Customer in each such case unless and until the consent,
          approval, notification or condition or other required action has been
          obtained, made, satisfied or carried out with respect to the property
          or asset concerned; and

     (b)  the Customer will diligently make all applications, pay all costs and
          expenses and do all things necessary to obtain or have made, satisfied
          or carried out any consent, approval, notification, condition or other
          action referred to in the preceding paragraph (a).

(2)  PROHIBITED CHARGES
     (Suspension because of absolute prohibition by law)

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<PAGE>
 
     Subject to sub-Clause 36(1), this Security shall not operate to charge any
     property or asset of the Customer absolutely prohibited by law from being
     charged in the manner contemplated by this Security or which, by this
     Security, would cause this Security to be absolutely void, voidable or
     unenforceable.

(3)  CERTAIN CLAUSES TO APPLY
     (Certain Clauses to apply to property not charged)

     Notwithstanding sub-Clause 36(1) and (2), any reference in Clauses 3, 6, 7,
     3, 29 and 31 of this Secured Mortgaged Property shall include any property
     or asset which is not, or which is not for the time being, a result of this
     Clause 36.

(4)  NO PREJUDICE TO SECURITY
     (Operation of Security not to be prejudiced)

     Nothing in this Clause 36 shall prejudice the operation of this Security on
     any property or asset of the Customer otherwise referred to in sub-Clause
     36(1) or (2).

37.  COUNTERPARTS
     (Counterparts constitute one instrument)

     This security may consist of a number of counterparts and such counterparts
     taken together constitute one same instrument.

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                                   SCHEDULE


Item 1:   Name and Address of Customer:

          TOTAL ENERGY SYSTEMS LIMITED ACN 010 876 150 a company duly
          incorporated according to law having its registered office at 3rd
          Floor, Invicta House, 172 Edward Street, Brisbane Qld

Item 2:   Permitted Prior Charges:

          Nil

Item 3:   (1) (Clause (35) - prospective liabilities)

          The prospective liabilities secured by this deed include, without
          limitation:

          Omnibus Facility comprising a mix of Overdraft/Commercial Bill
          Acceptance/Discount/Import Letter of Credit/Bills of Lading
          Surrendered/Trade Bills Discounted/Cheque Encashment Letter of
          Credit/Forward Exchange Cover Facilities under Facility Letter dated
          30 January 1995.

          (2) (Clause (35) - maximum prospective liability)

          Maximum prospective liability is $10,00,000 (together with interest,
          fees and expenses thereon or in connection therewith)

Item 4:   Governing Law:

          Queensland

Item 5:   Trust Details:
          (Complete only if this Security is given by the Customer as Trustee of
          a Trust.)

          Name of Trust: None disclosed


          Description (including dates and parties) of all documents
          establishing the Trust:


          Description (including date and parties) of all amendments to the
          documents establishing the Trust:

                                       62

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