National Spot Exchange Limited

National Spot Exchange LimitedCircularRef. No.: NSEL/TRD/2012/137 June 21, 2012Dear Members,Commencement of Spot Trading in Sugar M-30 Grade Traders’ Ex-Ambala (T+25) DeliveryContractIn terms of the provisions of the Rules, Bye-Laws and Business Rules of the Exchange, the Members ofthe Exchange are notified that Sugar M-30 Grade Traders’ Ex-Ambala Contract will be launched fortrading on Friday, the 22 nd June 2012.Contracts details and settlement procedure are as under:1) Contract Specifications of M-30 grade Sugar - enclosed as Annexure 1,2) Settlement Schedule and Warehouse Details - enclosed as Annexure 2,3) Deductions and Quality Parameters – Annexure 3,4) Charges relating to Trading, Settlement and delivery - enclosed as Annexure 4,5) Procedure, norms, conditions of delivery, quality check and withdrawal - enclosed as Annexure 5,6) Other Terms and conditions – enclosed as Annexure 6,The terms and conditions of the above referred contract and the process relating to the settlementthereof will be binding on all the members of the Exchange and clients trading through them.For any clarification, the following officials of the Exchange can be contacted:1) Mr. Vineet Gupta at +91 99539 00190 0r through email atVineet.gupta@nationalspotexchange.com2) Mr. Maneesh Pandey at +91 90500 01867 or through email atmaneesh.pandey@nationalspotexchange.comFor and on behalf ofNational Spot Exchange Ltd.H. B. MohantyAsst. Vice PresidentEncl.: As above-------------------------------------- Registered office --------------------------------------102-A, Landmark, Suren Road, Chakala, Andheri (East), Mumbai – 400 093Tel.: 022 – 6761 9900 Fax: 022 – 6726 9525www.nationalspotexchange.com email: NSEL-Trading@nationalspotexchange.com

Annexure 1Contract Specifications of Sugar M-30 Grade Traders’ Ex-Ambala (T+25) Delivery ContractCommodity DetailsCommoditySymbolDescriptionContract SpecificationsDaily ContractTrading periodTrading sessionSugarSM30AMBL25Sugar M-30 GradeShort Selling is Strictly Prohibited. All sellers should possesscommodities before giving sale order. Each buying and sellingtransaction will be settled on Trade to Trade Basis and result intocompulsory deliveryMonday to Saturday except Exchange specified holidaysMonday to Friday: 10:00 AM to 6:00 PMSaturday : 10:00 AM to 2:00 PMTrading Related InformationTrading UnitQuotation / Base ValueTick Size (minimum pricemovement)10 MT` per quintal` 0.10Daily Price Limits 4%Price QuoteInitial Margin 3%Maximum Order SizeDelivery Related InformationEx-Ambala NSEL warehouse including Excise Duty and all expenses.VAT and other taxes will be extra when applicable.1000 MTDeliverable GradeDelivery UnitDry fresh free flowing Sugar delivered at NSEL Warehouses on“AS IS WHERE IS BASIS”10 MT (with a tolerance limit of + 250 kgs) and direct multiplesthereof.Delivery Period Margin 10%Special MarginIn case of additional volatility, a special margin at such percentage, asdeemed fit, will be imposed immediately either on buy or sale side orboth sides in respect of all outstanding position.Delivery Center(s)Delivery LogicPackingWeighmentAuction Related DetailsSymbol for Auction Buy-inSymbol for Auction Sell-outAuction periodExchange designated warehouse at Ambala, within 50 Kms radius ofAmbala municipal limits.Compulsory. Net positions at close of the trading session shall beconsidered as the delivery obligation.The delivery of sugar can be made in the form of either in 50 kg newPP Bag with inner lining of Standard weight. Delivery must be inuniform packaging in multiples of delivery unit.At exchange designated weigh bridgeABM30AMB25ASM30AMB255:00 PM to 5:30 PM on the T+2 day2

A) Settlement Schedule:Annexure 2Particulars Day Pay-In Pay-OutFunds – Normal T+25 Up to 1:00 PM At 5:30 PMCommodities – Normal T+25 Up to 2:30 PM At 5:00 PMCommodities – Auction T+26 Up to 11:00 AM At 1:00 PMFunds – Auction T+26 Up to 12:00 Noon At 1:00 PMB) Details of Exchange Designated Warehouses:Address of the Warehouse : Warehouse No-1, Post Office - Mouli,Shahbad Ambala RoadAmbala – 134 202.Warehouse No-1 And 2, Yathuri Associates, C/oNaraingarh Sugar Mill Ltd, Naraingarh Road,Ambala – 134 202Contact Person :Contact No. :Maneesh Pandey+91 90500 01867Email : maneesh.pandey@nationalspotexchange.comWarehouse timings : 8:00 AM to 8:00 PM3

Annexure 3Quality ParameterQuality Specifications of Sugar confirming to the following quality standards will bedeliverable. Sugar in crystal form manufactured by vacuum pan processDeliverable GradeMGrain SizeMedium as determined by the methods prescribed in IS:498-2003ICUMSA Maximum of 200 ICUMSA as determined by ICUMSA GS 9/1/2/3-8,Prescribed in Sugar Analysis ICUMSA Methods Book.Polarization99.80% minimum on dry basis.Moisture0.08% maximumForeign Matter Less than 0.20%Crop Year ReferenceOnly sugar of current year is allowed for delivery.It may please be noted that 2.00 Kg weight loss per sampled lot will be considered on account ofhandling and sampling loss, which will be adjusted before issuing warehouse receipts to theseller / depositor.4

A) Storage ChargesCharges relating to Trading, Settlement and deliveryAnnexure 4• ` 0.25 per bag per day (1 day billing cycle exclusive of tax, if any).• These charges are inclusive of insurance and fumigation charges.• Storage Charges are waived off for those members and their constituents, who sale Sugar M-30 on SM30AMB25 out of the delivery receivable against the purchase position of SM30AMB2contracts.B) Cost of transaction: In respect of trading, delivery and settlement of Sugar M-30, the followingcharges shall be applicable:Sr.No.Charges Amount Remarks1. Transaction charges ` 10/- per lac of turnoverto be paid by both buyerand seller.This will apply on all transactions.2. Delivery Allocation /Warehouse ReceiptTransfer Charges` 90/- per lac to bevalued at trade ratepayable by both the buyerand seller.This will apply in all cases, whereverdelivery of goods takes place,irrespective of fresh stock beingdeposited or transfer of warehousereceipts pertaining to existingwarehouse stock.Additional Delivery and QC charges on Fresh deposit of commodities over and above theTransaction Charges.1. Sampling and Qualitycertification charges` 750/- per lot of 10 MTpayable by the seller atthe time of delivery ofphysical stock.This is payable in case of delivery ofphysical stock i.e. tendering freshdelivery of commodities by the seller.2. Delivery Charges ` 1000/- per lot of 10 MTpayable by the seller atthe time of delivery ofphysical stock.This is payable in case of tenderingfresh delivery of commodities by theseller.(b)Fresh deposit or withdrawal of physical stockCost of labor towardsunloading / stacking atthe time of deposit ofphysical commodityCost of labor towardslifting of physical stockPayable by seller basedon actuals, to be settledin cash between theseller and the labour /warehouseman directlyPayable by buyer basedon actuals, to be settledin cash between thebuyer and the labour /warehouseman directlyWeigh bridge charges Payable by respectiveparties directly to weighbridge at the time ofdepositing physical stockThis is payable by the seller only in thecase of delivery of physical stock, not incase of transfer of warehouse receiptThis payable by the buyer only in case oflifting of physical stock.Weighing will be done in presence ofwarehouseman representative, butcharges will be payable by the sellerdirectly to the weigh bridge in case of5

Cost of change of bags,if requiredor lifting of physicalstock.Payable by the respectiveparties directly to thewarehouseman based onactual.deposit of physical stock. Similarly, thebuyer will pay weigh bridge charges incase of lifting of physical stock directly.This is not applicable in case of transferof warehouse receipts.In case the warehouseman finds somebags not in usable conditions, thisamount will be payable by the seller, butthe seller will get back the bags rejectedby the warehouseman. Similarly, in casethe buyer wants some bags to bechanged, he has to pay this amount tothe warehouseman, depending uponnumber of bags to be changed.6

Procedure, conditions, norms of Deposit, Quality and Withdrawal of CommodityDeposit of SugarAnnexure 5The members and their clients willing to deposit sugar in the Exchange accredited warehouse areadvised to note the below mentioned procedure / conditions / norms.1. Members and their respective clients willing to deposit / stock sugar shall be liable to ensurethe statutory compliances with respect to Essential Commodities Act, 1955 and SugarControl order, 1966 relating to stock of sugar.2. Members and their respective clients willing to deposit commodity in the ExchangeWarehouse or Exchange accredited warehouse will be required to give at least 1 day priorintimation to the warehouse for necessary storage arrangements. Based on the intimationreceived from the depositor, delivery schedule will be intimated by the warehousesupervisor. Loading and Unloading of commodity will be done on first cum first serve basis.3. The commodity should reach the designated warehouse latest by 4:00 PM on T+1, in orderto have a hassle free delivery of commodity.4. Members and their respective Clients willing to deposit commodity in the Exchangeaccredited Warehouse will require to contact Warehouse Manager in advance for availabilityof space for necessary storage and Certification arrangements. Based on the intimationreceived, the depositor may bring and deposit commodity at Exchange accreditedWarehouse.5. There is no discretion between any origins – states within the country and hence stocks willbe accepted based on the contract specifications as specified by the Exchange.6. Sugar of current season will be accepted based on the contract specifications as specified bythe Exchange.7. Before deposit, goods have to be compulsorily weighed at the designated weigh bridge andwill be monitored and certified by the warehouse supervisor. It is to be ensured that theSugar delivered at the warehouse should comply strictly with the acceptable tolerance limitsas prescribed by the Exchange in the contract specification.8. Warehouse receipt will be issued by designated warehouse for all Sugar kept in thedesignated warehouse. The process flow for issuance of Warehouse Receipt, along with otherdocuments would be as under:Document Issued by PeriodWarehouse Receipt (for commoditiesto be stored initially and to be soldor lifted back at the option of thedepositor)WarehouseD+1 Up to 5:00 PMWhere D stands for the date of Deposit9. On expiry of the validity period of the stocks deposited, the depositor / buyer has to take outthe goods from the warehouse within 2 days from the date of expiry of validity period unlessspecifically allowed for storage for extended period. If the depositor / buyer fails to removethe goods within the time as mentioned above, the warehouse manager may remove thesame and sell the goods in public auction with a prior notice of 5 days to the depositor /client. The sale proceeds may be sent to the depositor / buyer of the goods after adjustingall the dues of the warehouse storage. Besides, Exchange may also impose penalty as it maydeem fit and proper.7

Withdrawal (Delivery out of Commodity from Exchange designated Warehouse):1. Members are required to give at least 1 day prior intimation to the warehouse for necessaryarrangements. Based on the intimation received from the withdrawer, delivery schedule willbe intimated by the warehouse supervisor. Loading of Sugar will be done on first cum firstserve basis. No vehicle will be allowed for withdrawing the goods after 5:00 PM in theevening. The warehouse manager’s decision will be final in this case.2. The buyer member shall submit the Letter of Authority requesting the Warehouse managerto issue the delivery of Commodity to the bearer of the Authority Letter along with originalCopy of the Warehouse Receipt. The Members are advised to instruct their representative tocarry some identity Proof (ID proof of his representative such as Voter ID / PAN / Passport toenable the Exchange) along with the Authority Letter and Original Warehouse Receipt forlifting the stock from the accredited warehouse.8

Other Terms and conditionsAnnexure 6Taxes, Duties, Cess and Levies: EX-WAREHOUSE – Ambala. Inclusive of Excise Duty butexcluding VAT and other charges. Delivery lifting charges are borne by the buyer. Sellers tenderingcommodity or Buyers taking delivery or their clients shall have necessary registration from theconcerned tax and other authorities and obtain relevant licenses, if any, required by them. TheMember giving delivery and the Member taking delivery will exchange appropriate tax forms asprovided in law and as customary and neither of the parties will unreasonably refuse to do so. Incase any of the member or his client fails to provide necessary forms in respect of sales tax resultinginto pecuniary loss to the other party, the Exchange will impose a charge on the party in default andafter collection thereof, will pass on the same to the member, who or whose client has suffered suchloss. In addition to above, the Exchange can impose additional penalty on the party in default.Deliverable grade of commodity: The selling members tendering delivery will have to deliversuch grades as may be acceptable as per the contract specifications. The buyer has no optionto select a particular grade and the delivery offered by the seller and allocation by the Exchangeshall be binding on him.Penal Provisions: Members have to compulsorily complete their funds and commoditypay-in obligations as per the pay in and delivery schedule. In case of default to complete pay-inwithin the scheduled time, the settlement shall be made through auction / close-out process atthe cost and risk of the defaulting member. In addition to the auction / close-out loss, a penaltyof 5% shall be levied upon the defaulting member, out of which 3% shall be passed on tothe corresponding buyer / seller.Delivery allocation: Delivery will be allocated at client level after the pay-in of commodities.Tax Invoice: The respective Clients of Members or the Member himself in case he sells onhis own account, after execution of sale shall have to raise invoice in triplicate One copy forthe onward delivery to the buyer, one copy to be sent to exchange and the third to be retained bythe seller for his own records.Warehouse, Insurance and Transportation charges: As specified in Annexure – 4.Extension of delivery period: As per decision of the Exchange due to a force majeure orotherwise.Legal obligation: The members will provide appropriate tax forms wherever required as per lawand as customary and neither of the parties (seller member and buyer member) will unreasonablyrefuse to do so.Applicability of Business Rules: The general provisions of Business Rules of the Exchangeand decisions taken by the Board of Directors and Executive Committee of the Exchange inrespect of matters specified above will apply mutatis mutandis. The Exchange may furtherprescribe additional measures relating to delivery procedures, warehousing, quality certification,margin and risk management from time to time. In case of any interpretational dispute orclarifications, the decision of the Exchange shall be final and binding on the members and others.*********9