Exhibit 10.12

 

DRAWN AND/OR PREPARED BY:

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Attorney-at-Law

Lex Caribbean Law Offices

Worthing Corporate Centre

Worthing, Christ Church Barbados

DEBENTURE MORTGAGE

STAMPED TO SECURE BDS$9,000,000.00 and US$4,500,000.00 OR THE EQUIVALENT IN
BARBADOS DOLLARS

BARBADOS

THIS DEBENTURE AND DEED OF CHARGE by way of Legal Mortgage is made as of the
15th day of November, 2007 BETWEEN PSMT (BARBADOS) INC., a company incorporated
under the provisions of the Companies Act Chapter 308 of the Laws of Barbados as
Company No. 17693 and having its registered office situate at Aastra Law,
Pinfold Street, Bridgetown, Barbados in this Island (hereinafter called “the
Borrower”) of the FIRST PART REGAN LODGE INC. a company registered under the
provisions of the Companies Act Chapter 308 of the Laws of Barbados as Company
No. 19916 which resulted from the amalgamation of Green Lodge Inc. (Company
No. 19662) and Regan Lodge Inc. (Company No. 19394) and having its registered
office situate at Musson Building, Hincks Street in the City of Bridgetown in
this Island (hereinafter called “the Mortgagor”) of the SECOND PART AND CITICORP
MERCHANT BANK LIMITED a licensed bank and trust company incorporated in the
Republic of Trinidad & Tobago and registered as an External Company under the
provisions of the Companies Act Chapter 308 of the Laws of Barbados as Company
No. 16184 and having its principal office in Barbados situate at ITC Building
Warrens Commercial Centre Warrens in the parish of Saint Michael in this Island
on its own behalf and as security trustee for Citibank N.A. acting through its
International Banking Facility (hereinafter sometimes called “the Mortgagee”) of
the THIRD PART.

WHEREAS Citicorp Merchant Bank Limited (hereinafter sometimes called “Citicorp”)
has at the request of the Borrower agreed to grant and advance to the Borrower
the sum of BDS$9,000,000.00 or other banking and credit facilities or
accommodation upon the terms and conditions contained and implied in the
Citicorp Loan Agreement as hereinafter defined and upon the terms and conditions
contained in this Debenture Mortgage.

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AND WHEREAS Citibank N.A. through its International Banking Facility
(hereinafter called “Citibank”) has at the request of the Borrower agreed to
grant and advance to the Borrower the sum of US$4,500,000.00 or other banking
and credit facilities or accommodation upon the terms and conditions contained
and implied in the Citibank Promissory Note as hereinafter defined and upon the
terms and conditions contained in this Debenture Mortgage.

AND WHEREAS Citibank has obtained the approval of the Exchange Control Authority
of the Central Bank of Barbados to grant and extend to the Borrower the sum of
US$4,500,000.00.

AND WHEREAS the Borrower and the Mortgagor are affiliated companies within the
meaning of Section 440 of the said Companies Act and the respective boards of
directors and shareholders of the Borrower and of the Mortgagor have resolved
that it is desirable and in the interest of the Borrower and the Mortgagor that
the Borrower and the Mortgagor should in consideration of the loan and other
credit facilities and accommodation provided or about to be provided to the
Borrower by the Citicorp and Citibank execute and grant to the Mortgagee such
security as is hereinafter contained and hereunder implied.

AND WHEREAS the Mortgagor is the estate owner of the fee simple absolute in
possession in the Land as hereinafter defined and described in the First
Schedule hereto subject as appears in the Second Schedule hereto and subject
also to the charge mentioned in the Third Schedule hereto and the monies
principal interest and otherwise now remaining secured thereby but otherwise
free from encumbrances.

AND WHEREAS the Mortgagor has agreed to join in these presents for the purpose
of providing the Land and other property of the Mortgagor as security for the
Loans as hereinafter defined.

NOW THIS DEED WITNESSETH as follows:

1.1 In this Debenture Mortgage:-

“Barbados Dollars” or “BDS$” means the lawful currency of Barbados.

“Citibank Agreed Rate” means the rates set out in the Citibank Promissory Note
or from time to time agreed between the Borrower and Citibank.

“Citibank Loan” means the sum of US$4,500,000.00 and (i) all and any amounts
owing by the Borrower to Citibank pursuant to the terms of the Citibank
Promissory Note (ii) interest to the date of payment at such rate and upon such
terms as may from time to time be agreed (or if not agreed according to the
usual practice of Citibank), as

 

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well after as before any demand or judgment; (iii) commissions, fees and other
charges; and (iv) all legal and other costs charges and expenses incurred by
Citibank in relation to the Borrower or the properties hereby mortgaged or the
other assets hereby charged on a full indemnity basis.

“Citibank Promissory Note” means the Promissory Note dated          the day of
                     made by the Borrower payable to Citibank and includes any
other facility or agreement between Citibank and the Borrower.

“Citicorp Agreed Rate” means the rates set out in the Citicorp Loan Agreement or
from time to time agreed between the Borrower and Citicorp.

“Citicorp Loan” means the sum of BDS$9,000,000.00 and (i) all and any amounts
owing by the Borrower to the Citicorp pursuant to the terms of the Citicorp Loan
Agreement, (ii) interest to the date of payment at such rate and upon such terms
as may from time to time be agreed (or if not agreed according to the usual
practice of the Citicorp), as well after as before any demand or judgment;
(iii) commissions, fees and other charges; and (iv) all legal and other costs
charges and expenses incurred by Citicorp in relation to the Borrower or the
properties hereby mortgaged or the other assets hereby charged on a full
indemnity basis.

“Citicorp Loan Agreement” means the Loan Agreement dated the          day of
                     and made between Citicorp and the Borrower and includes any
other facility or agreement between Citicorp and the Borrower.

“Land” means the land more particularly described in the First Schedule hereto.

“Lenders” mean Citibank and the Mortgagee together;

“Loan Agreements” mean the Citibank Promissory Note and the Citicorp Loan
Agreement together.

“Loans” means the Citibank Loan and the Citicorp Loan together.

“Secured Liabilities” means all monies obligations and liabilities whatsoever
whether for principal interest or otherwise in whatever currency which may now
or at any time in the future be due owing or incurred by the Borrower or the
Mortgagor to the Mortgagee or either of the Lenders whether present or future
actual or contingent and whether alone severally or jointly as principal
guarantor surety or otherwise and in whatever name or style and whether on any
current or other account or in any other manner whatsoever.

“United States Dollars” or “US$” means lawful currency of the United States of
America.

1.2 Subject to any expressed provisions to the contrary herein contained the
provisions and definitions contained in or implied by the Property Act Chapter
236 of the Laws of Barbados shall apply and extend to this Deed.

2.1 In pursuance of the said recited agreements and in consideration of the sum
or sums of money which are now or may hereafter be lent and paid by the Lenders
to or on behalf of the Borrower, the Borrower and the Mortgagor hereby jointly
and severally covenant with the Mortgagee:-

(a) to pay all sums due in respect of the Citicorp Loan and in respect of the
Citibank Loan in accordance with the terms of the Loan Agreements together with
interest on all

 

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such sums at the Citicorp Agreed Rate or the Citibank Agreed Rate, as the case
may be, computed from the date of advance of the same as well after as before
any judgment obtained hereunder, usual commission and lawful bank charges.

3.1 In further pursuance of the said recited agreement and for the consideration
aforesaid the Borrower as mortgagor and as beneficial owner hereby CHARGES to
the Mortgagee with the payment to Citibank and to Citicorp in accordance with
the covenants herein contained or implied or in the Citibank Promissory Note or
the Citicorp Loan Agreement for the payment and discharge of the Citibank Loan
and interest thereon and the Citicorp Loan and interest thereon and all other
moneys hereby or in the Citibank Promissory Note or the Citicorp Loan Agreement
expressly or impliedly covenanted to be paid by the Borrower and/or the
Mortgagor as a continuing security on:-

FIRSTLY ALL AND SINGULAR the freehold and leasehold property of the Borrower and
all rights-of-way, easements, licences and privileges, appurtenant or
appertaining thereto both present and future

SECONDLY all plant, machinery, equipment, furniture, fittings, fixtures
(including trade fixtures), vehicles, goods, inventory, stock in trade and other
items of personal property of the Borrower which at any time hereafter may
belong to or be vested in the Borrower or be brought or placed thereon or used
in connection therewith

THIRDLY all of the Borrower’s right, title and interest in all present and
future book debts, accounts and other accounts receivables, contract rights,
cash balances, choses in action, stocks, shares, bonds and securities of any
kind whatsoever and any interests arising therefrom

FOURTHLY the goodwill and the uncalled capital of the Borrower both present and
future

FIFTHLY the undertaking and all other personal property and assets of the
Borrower both present and future

SIXTHLY all existing and future insurance policies pertaining to the property
charged hereby and the proceeds therefrom

The charge hereby created shall as regards the property firstly described above
be a fixed first charge and as regards the property secondly to sixthly
described above shall be a floating charge but so that the Borrower shall not
without the consent in writing of the Mortgagee create any mortgage debenture or
charge upon and so that no lien shall (subject as herein provided) in any case
or in any

 

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manner arise on or affect any part of the property secondly to sixthly described
above ranking either in priority to or pari passu with the charge hereby
created. The Mortgagee may at any time by notice in writing to the Borrower
convert such floating charge into a fixed charge as regards all the assets
covered thereby or any assets specified in the notice which the Mortgagee may in
its absolute discretion consider to be in jeopardy or which may become the
subject of an injunction.

3.2 In further pursuance of the said recited agreement and for the consideration
aforesaid the Mortgagor as mortgagor and as beneficial owner hereby CHARGES to
the Mortgagee with the payment to Citibank and to Citicorp in accordance with
the covenants herein contained or implied or in the Citibank Promissory Note or
the Citicorp Loan Agreement for the payment and discharge of the Citibank Loan
and interest thereon and the Citicorp Loan and interest thereon and all other
moneys hereby or in the Citibank Promissory Note or the Citicorp Loan Agreement
expressly or impliedly covenanted to be paid by the Borrower and/or the
Mortgagor as a continuing security on:-

FIRSTLY ALL AND SINGULAR the freehold and leasehold property of the Mortgagor
and all rights-of-way, easements, licences and privileges, appurtenant or
appertaining thereto both present and future including (without prejudice to the
generality of the foregoing) the estate in fee simple absolute in possession of
the Mortgagor of and in ALL THAT the land and property described in the First
Schedule hereto (the “Land”) subject however as appears in the Second Schedule
hereto

SECONDLY all plant, machinery, equipment, furniture, fittings, fixtures
(including trade fixtures), vehicles, goods and other items of personal property
of the Mortgagor which at any time hereafter may belong to or be vested in the
Mortgagor or be brought or placed thereon or used in connection therewith

THIRDLY all of the Mortgagor’s right, title and interest in all present and
future book debts, accounts and other accounts receivables, contract rights,
cash balances, choses in action, stocks, shares, bonds and securities of any
kind whatsoever and any interests arising therefrom

FOURTHLY the goodwill and the uncalled capital of the Mortgagor both present and
future

FIFTHLY the undertaking and all other personal property and assets of the
Mortgagor both present and future

SIXTHLY all existing and future insurance policies pertaining to the property
charged hereby and the proceeds therefrom subject to the prior charge
particulars of which are contained in the Third Schedule hereto but otherwise
free from encumbrances.

 

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The charge hereby created shall as regards the property firstly described above
be a fixed charge subject to the prior charge particulars of which are contained
in the Third Schedule hereto and as regards the property secondly to sixthly
described above shall be a floating charge but so that the Mortgagor shall not
without the consent in writing of the Mortgagee create any mortgage debenture or
charge upon and so that no lien shall (subject as herein provided) in any case
or in any manner arise on or affect any part of the property secondly to sixthly
described above ranking either in priority to or pari passu with the charge
hereby created. The Mortgagee may at any time by notice in writing to the
Mortgagor convert such floating charge into a fixed charge as regards all the
assets covered thereby or any assets specified in the notice which the Mortgagee
may in its or their absolute discretion consider to be in jeopardy or which may
become the subject of an injunction.

3.3 The Borrower and / or the Mortgagor if and when required by the Mortgagee so
to do execute to the Mortgagee or as the Mortgagee shall direct such further
legal or other mortgages or charges as the Mortgagee shall require of and on all
the Borrower and/or the Mortgagor’s estate and interest in any premises and
property now belonging to the Borrower or the Mortgagor or which may hereafter
be acquired by or belong to the Borrower or the Mortgagor (including any
vendor’s lien) to secure all monies and liabilities hereby agreed to be paid or
intended to be hereby secured such mortgages or charges to be prepared at the
cost of the Borrower and / or the Mortgagor and to be substantially in
accordance with and subject to the terms and conditions contained in this Deed
including a power of sale and all other clauses for the benefit of Mortgagee as
the Mortgagee may reasonably require.

4. During the continuance of this security the Borrower and / or the Mortgagor
jointly and severally covenant with the Mortgagee in the following manner:-

(a) to furnish to the Mortgagee such financial information regarding the
Borrower and/or the Mortgagor as is set out in the Loan Agreements and also from
time to time such other information respecting the assets and liabilities of the
Borrower or the Mortgagor as the Mortgagee may reasonably require;

(b) to keep all buildings and inventories of stock in trade and other insurable
property subject hereto insured from loss or damage by fire, hurricane,
earthquake, riot and strike and against loss or damage by or from such
additional perils risks or events as in the name of the

 

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Mortgagee at a level of insurance coverage that is used for properties of
similar use and value and with an insurance company that is approved from time
to time by the Mortgagee and to forthwith deliver the certificates of insurance
evidencing the policy or policies for every such insurance to the Mortgagee and
to also duly and regularly pay the premiums and other sums of money necessary
for keeping on foot such insurances and deliver the appropriate insurance
certificate evidencing renewal of the insurance policy to the Mortgagee at least
five days before the same shall become due and if the Borrower and / or the
Mortgagor have failed to comply with the provisions of this section, the
Mortgagee may require any noncomplying insurance of the said buildings and other
property to be cancelled and new insurance of the said buildings and other
buildings and other property to be effected in a company or companies to be
named by the Mortgagee and also may without reference to the Borrower or the
Mortgagor effect or maintain any insurance herein provided for and mortgage
clauses in a form approved by the Mortgagee shall be attached to all such
insurance policies and the foregoing covenants and provisions as to insurance
shall apply to all buildings and other property whether now or hereafter erected
on the property and in the case of inventories of stock in trade wherever
situate and that in case the Borrower or the Mortgagor shall neglect to effect
any such insurance or to pay any such premium and to deliver the renewal
insurance certificate therefor or in any respect to comply with the provisions
of this covenant then and in every such case happening it shall be lawful for
the Mortgagee in its absolute discretion to insure the said buildings and other
property or any of them in manner aforesaid or to any less amount And it is
hereby declared that all moneys received under or by virtue of any such
insurance as aforesaid are hereby charged to and shall be paid to the Mortgagee
(or if not paid by the insurers directly to the Mortgagee held on trust for the
Mortgagee) and shall at the option of the Mortgagee either be applied in or
towards rebuilding reinstating or repairing the buildings and other property
destroyed or damaged or in or towards payment of the moneys for the time being
secured by these presents and further that the Borrower and the Mortgagor will
not suffer permit or allow any act to be done or omitted to be done which would
result in the cancellation of any of the insurances required to be carried
pursuant hereto or which would afford the insurers a valid defence in law to any
claim by the Borrower or the Mortgagor under any of the policies of insurance
required to be carried hereunder;

(c) to give to the Mortgagee such particulars relating to the buildings and
other insurable property subject hereto or any part thereof and such assistance
as the Mortgagee shall reasonably require for the purpose of effectuating any
such insurance as aforesaid;

(d) if the Mortgagee shall give to the Borrower and the Mortgagor

 

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particulars of any insurance effected by the Mortgagee in respect of any
buildings or other insurance property subject hereto, while such insurance
remains in force except with the written consent of the Mortgagee not to effect
or keep in force any other policy insuring the same buildings or other insurance
property or any part thereof against the same risks;

(e) to immediately inform the Mortgagee of any circumstances which may affect
the validity of and/or the premium payable under any policy of insurance;

(f) to keep all buildings and other property subject hereto in good and
substantial repair and condition and permit the Mortgagee and the agents of the
Mortgagee upon giving two (2) days prior notice of the same at all reasonable
times during the day time and without any further consent to enter into and upon
any lands and premises of the Borrower and / or the Mortgagor subject to this
charge and inspect the buildings and other property subject hereto and view the
state thereof and upon receipt of notice in writing from the Mortgagee
immediately to remedy restore repair amend and make good all such defects decays
wants of reparation amendment and upkeep of the property subject hereto as the
Mortgagee may reasonably require and if the Borrower or the Mortgagor shall
neglect to do so the Mortgagee may at its or their discretion enter upon the
said lands and premises from time to time in order to repair and keep in repair
the said buildings and other property and without thereby becoming liable as a
mortgagee in possession.

(g) not without the written consent of the Mortgagee first had and obtained to
make or permit or suffer to be made any material change or addition whatsoever
to the lands and buildings subject hereto or the use thereof;

(h) not do or permit or suffer to be done or permitted anything in consequence
whereof the buildings and other property subject hereto may in any way
deteriorate or lessen in value or any policy of insurance be increased;

(i) to maintain their corporate existence in good standing under the laws of
Barbados and do all such acts and things and file such returns and documents to
and with the competent authorities in Barbados in order to comply in all
material respects with all laws in force governing companies in Barbados and
affecting the Borrower and the Mortgagor and will in the event or reorganisation
reconstruction of the Borrower or the Mortgagor execute all such instruments
acts and things (if any) as may reasonably be required by the Mortgagee to
ensure that all the covenants and obligation binding on the Borrower and the
Mortgagor hereunder shall continue to bind the successors of the Borrower and of
the Mortgagor;

(j) to keep proper books of accounts and records in accordance with sound
accounting practices and ensure that the same shall be open for inspection by or
on behalf of the Mortgagee;

 

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(k) except for the Permitted Liens (as described in the Citicorp Loan Agreement)
not apply for or accept any lien which by virtue of any statute law or
regulation will rank pari passu or in priority to this security in respect of
the property hereby charged or any part thereof without first obtaining the
written consent of the Mortgagee;

(1) to insure and keep insured to the reasonable satisfaction of the Mortgagee
against liability to pay compensation under the National Insurance Act and
Occupier’s Liability Act from time to time in force in Barbados;

(m) not to permit the withdrawal from the Borrower or the Mortgagor of any
capital or allow any reconstruction or corporate reorganisation which may result
in any such withdrawal nor engage in any capital expenditure in an amount in
excess of US$500,000 (or the equivalent thereof) without the prior approval of
the Mortgagee, such consent not to be unreasonably withheld;

(n) not without the written consent of the Mortgagee first had and obtained to
sell, lease, transfer, part with the possession of or otherwise dispose of any
of their freehold or leasehold interest in any of their real property;

(o) not without the written consent of the Mortgagee first had and obtained to
sell, lease, transfer, part with possession of or otherwise dispose of any of
their material property or assets which shall be required for the efficient
carrying on of its business, such written consent of the Mortgagee not to be
unreasonably withheld, provided however that the Mortgagee may withhold such
consent if in its sole discretion such sale, lease, transfer, disposal of
possession or other disposal shall or may affect the value or level of the
security it requires for any of its loans or other sums due to it by the
Borrower.

(p) except for loans and guarantees permitted pursuant to Section 4.01(1) of the
Citicorp Loan Agreement, not to make any loans or give any guarantees without
the prior written approval of the Mortgagee (such consent not to be unreasonably
withheld);

(q) to comply with all enactments and regulations under the Town and Country
Planning Act Chapter 240 of the Laws of Barbados for the time being in force and
with all By-Laws whether under that Act or in any other legislation which may
affect any property of the Borrower or of the Mortgagor from time to time;

(r) to punctually pay and indemnify the Mortgagee and any receiver

 

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appointed by it against all existing and future rent rates taxes duties levies
deductions charges withholdings assessments impositions and outgoings whatsoever
(whether imposed by agreement statute or otherwise and whether in the nature of
capital or revenue and even if wholly novel) now or at any time during the
continuance of this security payable in respect of the property hereby secured
or any part thereof or by the owner or occupier thereof. If any such sums shall
be paid by the Mortgagee or by any such receiver the same shall be repaid by the
Borrower or the Mortgagor on demand with interest at the Citibank Agreed Rate or
at the Citicorp Agreed Rate;

(s) not without the prior consent in writing of the Bank cause or permit any
person to be registered under the Land Registration Act Chapter 229 of the Laws
of Barbados as proprietor of the Land or any part thereof or interest therein
nor without such consent shall the Borrower or the Mortgagor create or permit to
arise any overriding interest affecting the Land within the definition in that
Act; provided however that the Mortgagor may with the written consent of the
Mortgagee, which said consent shall not be unreasonably withheld, become
registered under the said Land Registration Act as the proprietor of the Land or
part thereof;

(t) to maintain any and all regulatory registrations, approvals, consents,
licences and filings registered by the Borrower or the Mortgagor in order to
properly conduct its business, including to grant the security over the property
hereby secured;

(u) to conduct and carry on their business in a proper and efficient manner and
not make any substantial alteration in the nature of or mode of conduct of that
business;

(v) to furnish to the Mortgagee on an annual basis evidence of payment of Value
Added Tax, Pay As You Earn deductions, National Insurance contributions and
other statutory payments;

(w) to repay to the Mortgagee immediately on demand all moneys expended by the
Mortgagee:-

(i) in carrying out repairs to or work upon any property as authorised by this
Deed;

(ii) in paying all charges in connection with any inspection of any property of
the Borrower or of the Mortgagor for the purposes of this security or in
connection with any such repairs or work as aforesaid;

(iii) in effecting any insurance policy on the buildings or other insurance
property subject in accordance with this Deed;

 

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(iv) in taking recovering and keeping possession of any property of the Borrower
or of the Mortgagor and generally in any other proceedings taken to realise the
moneys hereby secured or in perfecting or protecting the security for the said
moneys together with a proper allowance for the time and services of any person
appointed by the Mortgagee and all Attorneys-at-Law and agents’ charges and
commissions for or in respect of the collection of any overdue interest the
principal sum insurance premiums taxes or any other moneys whatsoever payable by
the Borrower and / or the Mortgagor hereunder and in relation to any other
matter hereunder whether any action or other judicial proceeding to enforce such
payment has been taken or not.

PROVIDED ALWAYS that all moneys expended by the Mortgagee as aforesaid shall
carry interest at the appropriate rate and until payment the same with interest
as aforesaid shall be a charge on the property.

5. The Borrower and the Mortgagor hereby further jointly and severally covenant
with the Mortgagee that during the continuance of this security neither the
Borrower nor the Mortgagor shall at any time without the prior consent in
writing of the Mortgagee:-

(a) except for Permitted Liens, create or attempt to create or permit to subsist
any mortgage or charge upon or permit any lien or other encumbrance to exist or
arise on or affect any part of the properties hereby secured;

(b) except for loans and indebtedness permitted pursuant to Section 4.01(1) of
the Citicorp Loan Agreement, apply for any loan or incur any further
indebtedness or borrow any sums of money in addition to the facilities hereby
secured;

(c) except for loans and indebtedness permitted pursuant to Section 4.01(1) of
the Citicorp Loan Agreement, permit any subsidiaries now or hereafter wholly
owned or controlled by the Borrower or the Mortgagor to increase any existing
borrowings or enter into any new borrowings;

(d) pay any dividends or make any distributions to any of the shareholders of
the Borrower;

(e) repay any loans to directors or shareholders of the Borrower or the
Mortgagor or repay any inter company loans until the facilities hereby secured
are

 

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repaid in full unless the Mortgagee shall be duly satisfied that such repayment
shall not affect the Borrower’s or the Mortgagor’s ability to fulfill its
obligations under the Loan Agreements or this Debenture Mortgage;

(f) sell any accounts receivables with or without recourse(other than sells in
the ordinary course of business for collection of past due accounts
receivables);

(g) enter into any sale or leaseback transactions for the sale or leaseback of
any of the assets of the Borrower or of the Mortgagor;

(h) except as permitted pursuant to the Loan Agreements, make or permit to be
made any loans, investments or advances;

(i) except as permitted pursuant to the Loan Agreements, consolidate with or
amalgamate into any other company or society or sell all or substantially all of
its assets or permit any other company or society to amalgamate into the
Borrower or the Mortgagor or acquire all or a substantial part of the assets or
capital stock of the Borrower or of the Mortgagor or of any other person, firm
or company if such acquisition is analogous in either purpose or effect to a
consolidation or amalgamation.

6.1 If any Event of Default shall occur and be continuing then:

(a) the Lenders shall cease to be under any further commitment to the Borrower
and the Mortgagor and may at any time thereafter (notwithstanding any
conflicting agreement or arrangement) declare the Secured Liabilities (or such
of them as the Mortgagee may specify) to be immediately due and payable or
payable forthwith on demand;

(b) the security hereby constituted shall become immediately enforceable and the
power of sale and other powers conferred by the Property Act, CAP 236 of the
Laws of Barbados (the “Property Act”) as varied or extended by this Debenture
Mortgage shall become immediately exercisable without the restrictions contained
in the Property Act as to the giving of notice or otherwise; and

(c) the floating charges hereby created shall immediately attach and become
fixed charges.

6.2 Each of the following events shall constitute an Event of Default, that is
to say:

(a) if default is made in the payment of any principal to Citicorp under the
terms of the Citicorp Loan Agreement under the Citibank Promissory Note; or if

 

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default is made in the payment of any interest or any other sum of money payable
to Citicorp under the terms of the Citicorp Loan Agreement or to Citibank under
the terms of the Citibank Promissory Note or hereunder within five (5) Business
Days of the date such amount become due and payable;

(b) if the Borrower fails to perform or observe any covenant, agreement or
obligation on the part of the Borrower contained in the Loan Agreements beyond
any cure periods provided therein;

(c) if the Borrower or the Mortgagor fails to perform or observe any covenant,
agreement or obligation on the part of the Borrower or the Mortgagor contained
herein and such failure continues for more than 30 consecutive days after
written notice from the Mortgagee to the Borrower or the Mortgagor, as
applicable, requiring such failure to be remedied;

(d) if the Borrower defaults under any loan agreement facility letter or other
agreement or obligation relating to borrowing (which expression includes all
liabilities in respect of accepting endorsing or discounting any notes or bills
and all unpaid rental and other liabilities present and future under
hire-purchase credit sale conditional sale leasing and similar agreements but
excludes any trade payables and the Loan Agreements) or under any guarantee
(which expression includes all contingent liabilities undertaken in respect of
the obligations or liabilities of any third party including all guarantees
indemnities or bonds whether constituting primary or secondary obligations or
liabilities) in any case which is outstanding in a principal amount in excess of
BDS$500,000.00 (or the then equivalent amount in any other currency) or if any
borrowing or other money payable under any of the foregoing becomes or is
capable of being declared payable prior to its stated maturity or is not paid
when due or if any mortgage charge or other security now or hereafter created by
the Borrower or the Mortgagor becomes enforceable or if any facility or
commitment now or hereafter available to the Borrower is withdrawn or cancelled
by reason of default;

(e) if an Event of Default as defined in either of the Loan Agreements occurs;

(f) if the Land or any material part thereof is compulsorily acquired or
requisitioned or notice is given of the intention to compulsorily acquire the
Land or any part thereof which materially and adversely affects value of the
Collateral;

 

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(g) if any other creditor or an encumbrancer takes possession or exercises or
attempts to exercise any power of sale or a receiver is appointed of the whole
or any part of the property assets or revenues of the Borrower or of the
Mortgagor;

(h) if the Borrower or the Mortgagor ceases or threatens to cease to carry on
business or becomes insolvent;

(i) if a distress or execution or other process of law be levied upon or issued
against any of the property of the Borrower or of the Mortgagor;

(j) if an order be made or an effective resolution be passed for the winding up
of the Borrower or of the Mortgagor;

(k) if a receiver be appointed of any of the Borrower’s or any of the
Mortgagor’s property by any court of debenture holder or trustees for debenture
holders;

(1) if any security created by any mortgage of charge securing an amount in
excess of BDS$250,000.00 (or the then equivalent amount in any other currency)
given by the Borrower or by the Mortgagor shall become enforceable and the
mortgagee or chargee thereof takes any steps to enforce the same;

(m) if any indebtedness or obligation in an amount in excess of BDS$250,000.00
(or the then equivalent amount in any other currency) of the Borrower or of the
Mortgagor for the repayment or any borrowed monies shall become due and payable
prior to the specified maturity date thereof due to any default hereunder or is
otherwise not paid when due and payable (giving effect to all grace periods
therein);

(n) except as permitted pursuant to Section 5(d) hereof, the Borrower or the
Mortgagor makes any reduction in its issued share capital;

(o) if any judgment is entered up in the High Court against the Borrower or the
Mortgagor or if any order made against the Borrower or the Mortgagor is not
complied with or discontinued within a period of ten (10) consecutive days after
entry thereof or if an execution distress sequestration or other process is
levied or enforced upon or sued out against any part of the property assets or
revenues of the Borrower or the Mortgagor;

(p) if the Borrower or the Mortgagor, without the prior consent in writing of
the Mortgagee ceases or threatens to cease to carry on the Borrower’s or the
Mortgagor’s business or any material part thereof in the normal course or
changes the nature or mode of conduct of the Borrower’s or Mortgagor’s trading
in any material respect;

 

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(q) if any material part of the property assets or revenues of the Borrower or
of the Mortgagor is sold or disposed of or threatened to be sold or disposed of
(otherwise than in the normal course of trading) whether in a single transaction
or a number of transactions or is nationalised compulsorily acquired seized or
appropriated;

(r) if any necessary consent to the user of the property hereby charged for its
existing use is revoked or withdrawn or if any notice served with a view to
forfeiture of any leasehold premises hereby charged pursuant to Section 167 of
the Property Act Chapter 236 (“the Property Act”) is not complied with within
the period specified;

(s) if any licence authorisation consent or registration at any time necessary
or desirable to enable the Borrower to comply with the Borrower’s obligations to
the Mortgagee or to the Lenders or any one of them, or if any licence
authorisation consent or registration at any time necessary or desirable to
enable the Mortgagor to comply with the Mortgagor’s obligations to the
Mortgagee, or to carry on the Borrower’s or the Mortgagor’s business in the
normal course shall be revoked withheld or materially modified or shall fail to
be granted or perfected or shall cease to remain in full force and effect;

(t) if any representation warranty or undertaking furnished to the Lenders or
the Mortgagee at or prior to the date of this Debenture Mortgage or from time to
time thereafter made to the Mortgagee by the Borrower or the Mortgagor is or
becomes incorrect or misleading in a material respect.

(u) if either the Borrower or the Mortgagor:

(i) becomes insolvent, or commits any act of bankruptcy, within the meaning of
the Bankruptcy and Insolvency Act, 2001 of the Laws of Barbados; or

(ii) commences negotiations with any one or more of its creditors with a view to
the general readjustment or rescheduling of all or a material portion of its
indebtedness; or

(iii) makes a general assignment for the benefit of or a composition with its
creditors; or

(iv) makes, or gives notice of its intention to make, a proposal within the
meaning of Section 12 of the Bankruptcy and Insolvency Act, 2001, or if any such
proposal is made in respect of the either of them.

 

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(v) if any guarantee indemnity or other security for any of the Secured
Liabilities fails or ceases in any respect to have full force and effect or to
be continuing or is terminated or disputed or in the opinion of the Mortgagee is
in jeopardy invalid or unenforceable or if this Debenture Mortgage or the
security constituted by it is disputed or in the opinion of the Mortgagee is in
jeopardy;

(w) if at any time it is or becomes unlawful for the Borrower or the Mortgagor
to perform or comply with any or all of its obligations under this Debenture
Mortgage or any other agreement between the Borrower and the Mortgagee or any of
such obligations of the Borrower or the Mortgagor are not or cease to be legal
valid binding and enforceable;

(x) if control (within the meaning of Section 441 of the Companies Act, CAP 308
of the Laws of Barbados) or the power to take control of the Mortgagor or the
Borrower is acquired by any person or company or group of affiliates (as defined
in such Act) not having control of it at the date of this Debenture Mortgage
(unless with the prior consent in writing of the Mortgagee); or

(y) if in the opinion of the Mortgagee a material adverse change occurs in the
financial condition results of operations or business of the Mortgagor or the
Borrower.

7. It is hereby agreed and declared as follows:

7.01 The security hereby created shall be without prejudice and in addition to
any other security or securities of whatever nature and howsoever effected which
the Mortgagee may now or from time to time hereafter hold or take from or
against the Borrower and/or the Mortgagor.

7.02 This Debenture Mortgage is given by the Borrower and the Mortgagor to the
Mortgagee and is accepted and taken by the Mortgagee as a continuing and running
security for payment to the Lenders of all money which is now owing or at any
time hereafter may be owing by the Borrower or the Mortgagor to the Mortgagee or
to the Lenders or for which the Borrower and/or the Mortgagor may be or become
liable to the Mortgagee or the Lenders together with interest thereon at the
Citicorp Agreed Rate or the Citibank Agreed Rate, as the case may be, from the
time or times of the same having been advanced lent or paid as aforesaid,
commission, banking charges, law and other costs, charges and expenses, and
notwithstanding the money and liabilities hereby secured or intended to be
secured may from time to time or at any time or times hereafter be reduced by
payments or otherwise yet the Mortgagee may at any time or times hereafter
recover under this

 

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Debenture Mortgage any sum or sums which may be found to be due and owing by the
Borrower and/or the Mortgagor to the Mortgagee or to the Lenders on a final
settlement of account and interest thereon as aforesaid, commission, banking
charges, law and other costs, charges and expenses.

7.03 The moneys hereby secured or expressed and intended so to be shall be
limited for principal in accordance with the provisions of the Stamp Duty Act,
Cap. 91 of the Laws of Barbados and any statutory modification thereof
subsisting from time to time during the continuance of this security. The
Mortgagee shall be at liberty at any time and from time to time during the
continuance of this security in its absolute discretion as it may think fit
without reference to the Mortgagor and/or the Borrower to increase the stamp
duty already paid thereon to cover any existing or proposed increase in the
total indebtedness and liability of the Borrower and/or the Mortgagor to the
Mortgagee or to the Lenders expressed to be secured hereunder in excess of the
amount for which this Debenture Mortgage is currently stamped if the same is
insufficiently stamped for such purpose and all legal costs, charges and
expenses incurred by the Mortgagee in connection with such increase of stamp
duty shall be deemed to be properly incurred by the Mortgagee.

8. (1) At any time after an Event of Default under Section 6.2 has occurred, the
Mortgagee may in writing under the hand of any attorney or manager for the time
being of the Mortgagee or any person authorised by the Mortgagee in writing
appoint any person or persons (whether an officer of the Mortgagee or not) to be
a receiver or receivers or receiver/manager (hereinafter usually referred to as
a “receiver’) as to remuneration or otherwise the Mortgagee shall think fit and
remove any receiver so appointed and appoint another or others in his or their
place.

(2) Any receiver so appointed shall be deemed to be the agent of the Borrower
and of the Mortgagor (which shall alone be responsible for his or their acts or
defaults and for his or their remuneration) and the Mortgagee and any receiver
so appointed shall have power at any time after an Event of Default under
Section 6.2 has occurred (and without obtaining any further consent of or giving
any notice to the Borrower or the Mortgagor):

(a) to take possession of collect and get in any property hereby charged and for
that purpose to take any proceedings in the name of the Borrower and / or the
Mortgagor or otherwise as may seem expedient;

(b) to carry on manage or concur in carrying on and managing the business of the
Borrower and / or the Mortgagor or any part thereof and for any of those
purposes to raise or borrow any money that may be required upon the security of
the whole or any part of the property hereby charged in priority to this Deed or
otherwise;

 

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(c) to sell or concur in selling (but where necessary with the leave of the
Court) and to let or concur in letting and to accept surrenders or leases or
tenancies of all or any of the property hereby charged or mortgaged and to carry
any such sale letting or surrender into effect by conveying leasing letting or
accepting surrenders in the name and on behalf of the Borrower and / or the
Mortgagor or other the estate owner Any such sale may be for cash debentures or
other obligations shares stock or other valuable consideration and may be
payable in a lump sum or by installments spread over such period as the receiver
shall think fit. Plant machinery and other fixtures may be severed and sold
separately from the property containing them without the consent of the Borrower
or the Mortgagor being obtained thereon;

(d) to make any arrangement or compromise which he or they shall think
expedient;

(e) to make and effect all repairs, renewals and any improvements of the
Borrower’s and / or the Mortgagor’s plant machinery and effects and maintain or
renew all insurances;

(f) to appoint managers, agents, officers, servants and workmen for any of the
aforesaid purposes at such salaries and for such periods as the receiver may
determine;

(g) to do all such other acts and things as may be considered to be incidental
and conducive to any of the matters or powers aforesaid and which he or they
lawfully may or can do as agent for the Borrower and the Mortgagor.

(3) All monies received by such receiver shall after providing for his or their
remuneration and for all costs and expenses in carrying on the business of the
Borrower and / or the Mortgagor or the sale or disposal of the whole or any part
of the property hereby charged or mortgaged be applied in providing for:-

(a) all rates rents taxes assessments and outgoings whatever affecting the
property hereby charged;

(b) all annual sums or other payments and the interest on all principal sums (if
any) having priority to this security;

(c) the premiums on fire or other insurance and the cost of executing repairs,
renewals and improvements of the Borrower’s and / or the Mortgagor’s plant,
machinery and effects; and

 

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(d) in or towards satisfaction of the money hereby secured and the receiver
shall pay the residue (if any) of the monies received by him to the Borrower and
/ or the Mortgagor.

(4) In appointing or refraining from appointing a receiver the Mortgagee shall
not incur any liability to the receiver of the Borrower or the Mortgagor or
otherwise.

9. It is hereby agreed and declared as follows:-

(l) All moneys payable hereunder by the Borrower and / or the Mortgagor to the
Lenders or any one of them shall be paid to the Lenders or any one of them
without any deductions whatsoever at the Mortgagee’s principal place of business
in Barbados or at such other place in Barbados as Lenders or any one of them may
from time to time designate for the purpose.

(2) Any notice hereunder shall be deemed to be duly served in the case of notice
to the Borrower or the Mortgagor if it is addressed to the Borrower or the
Mortgagor at and left at or posted by registered post to the property or the
Borrower’s or the Mortgagor’s last address known to the Mortgagee and in the
case of notice to Mortgagee if it is addressed to the Mortgagee at and left at
or posted by registered post to the Mortgagee’s principal place of business in
Barbados or the place if any for the time being designated in writing by the
Mortgagee for the payment of moneys hereunder and any such notice which is
posted as aforesaid shall be deemed to have been served forty-eight (48) hours
after the posting thereof.

(3) No delay in the exercise or omission to exercise any right power or remedy
available to the Mortgagee upon any default under this Debenture Mortgage shall
impair such right power or remedy or be construed as a waiver thereof or as
acquiescence in such default nor shall any act or omission of the Mortgagee in
respect of any default or any acquiescence by the Mortgagee in any default
affect or impair any right power or remedy of the Mortgagee in respect of any
other default.

(4) Neither the Borrower nor the Mortgagor shall be entitled to exercise any
powers of leasing or accepting surrenders of leases given by any Statute in that
behalf except with the consent in writing of the Mortgagee.

(5) The provisions of any Statute restricting the mortgagee’s right of
consolidation shall not apply to this Debenture Mortgage.

(6) The taking of a judgment or judgments on any covenant or covenants herein
contained shall not operate as a merger of the said covenant or covenants or
affect the Lenders’ right to interest at the rate and time herein set forth.

 

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10. The Borrower and the Mortgagor hereby irrevocably appoint the Mortgagee and
all others deriving title under the Mortgagee to be the attorney and attorneys
of the Borrower and the Mortgagor for it and in its name and on its behalf and
as its act and deed or otherwise to sign seal and deliver and otherwise perfect
any conveyance by the Mortgagee as mortgagee in any exercise of the power of
sale vested in it by virtue of these presents and/or the provisions of the
Property Act Chapter 236 of the Laws of Barbados and for that purpose to act by
the Mortgagee’s own proper officers agents and attorneys.

10.1 The Borrower hereby certifies by its being a party to these presents that
it is a company resident in Barbados for the purposes of the Exchange Control
Act of Barbados (as amended).

10.2 The Mortgagor hereby certifies by its being a party to these presents that
it is a company resident in Barbados for the purposes of the Exchange Control
Act of Barbados (as amended).

IN WITNESS WHEREOF this Debenture Mortgage is executed under Seal in the manner
herein appearing.

THE FIRST SCHEDULE HEREINBEFORE REFERRED TO

ALL THAT land (formerly part of a larger area said to contain 20234.27 square
metres but found by subsequent survey to contain 20109 square metres or
thereabouts itself formerly part of the lands of the Lodge Plantation) situate
at the corner of Lodge Road and Highway 2 in the parish of Saint Michael in
Barbados containing by admeasurement 16,985 square metres or thereabouts and
made up of two parcels of land containing 3,488 and 13,497 square metres and
being the lots numbered 2 and 3 respectively delineated and shown on a plan
certified on the 2nd day of March 2001 by Michael H. Hutchinson, Land Surveyor
ABUTTING AND BOUNDING on a road 7.14 metres wide on lands now or late of
Gardiner Austin & Company Ltd. on a public road called Highway 2 on another
public road called Lodge Road and on a road 6.23 metres wide or howsoever else
the same may abut and bound Together with the buildings and erections thereon.

 

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THE SECOND SCHEDULE HEREINBEFORE REFERRED TO

The easements restrictive covenants and conditions contained or mentioned in a
Conveyance dated the 16th day of July, 1971 (recorded in the Registration Office
of Barbados on the 17th day of December, 1971 as Deed Number 6314) and made
between Cyril A. Thornton et al of the One Part and Rocklyn Bus Co. Limited of
the Other Part.

THE THIRD SCHEDULE HEREINBEFORE REFERRED TO

Debenture/Mortgage dated the 7th day of May, 2001 (recorded in the Registration
Office of Barbados on the 5th day of July, 2001 Deed Number 4915) and made
between Regan Lodge Inc. and Citicorp Merchant Bank Limited.

 

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THE COMMON SEAL of PSMT (BARBADOS)

INC. was hereto affixed by Atulkumar Chandubhai

Patel in the presence of:-

 

)

  

LOGO [g42433exg22_1.jpg]

    

)

       

)

            

PSMT (BARBADOS) INC.

CNR OF LODGE HILL & GREEN HILL ROAD

WARRENS, ST MICHAEL BB12001

Witness:

 

/s/ SHARON C.I. CARTER

       

Name:

 

SHARON C.I. CARTER

       

Address:

 

22 EALING PARK, STAGE 1

CHRIST CHURCH.

       

Occupation:

 

ATTORNEY-AT-LAW

       

THE COMMON SEAL of REGAN LODGE

INC. was hereto affixed by Atulkumar Chandubhai

Patel in the presence of:-

 

)

  

LOGO [g42433exg22_2.jpg]

     )         )      

         

LOGO [g42433exg22_3.jpg]

Witness:

Name:

Address:

 

Occupation:

 

/s/ SHARON C.I. CARTER

SHARON C.I. CARTER

22 EALING PARK, STAGE 1

CHRIST CHURCH.

ATTORNEY-AT-LAW

                                     

 

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LOGO [g42433exg_p25whole-page.jpg]

 

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DATED   2007

PSMT (BARBADOS) INC.

AND

REGAN LODGE INC.

TO

CITICORP MERCHANT BANK LIMITED

 

 

DEBENTURE AND DEED OF CHARGE

BY WAY OF LEGAL MORTGAGE

 

 

LEX CARIBBEAN

ATTORNEYS-AT-LAW