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                                                                   EXHIBIT 10.30

                                    DEBENTURE

THIS DEBENTURE is made the 29th day of May Two Thousand and Two

BETWEEN: OCEAN CONVERSION (CAYMAN) LIMITED, a company incorporated under the
         Laws of the Cayman Islands, the registered office of which is at
         Campbell Corporate Services Ltd. P.O. Box 268GT, Scotiabank Building,
         Cardinal Avenue, George Town, Grand Cayman (hereinafter called "the
         Borrower")

                           of the One Part

AND:     THE BANK OF N. T. BUTTERFIELD & SON LTD., a bank registered in Bermuda,
         of P. O. Box HM 195, 65 Front Street, Hamilton, Bermuda (hereinafter
         called "the Bank")

                           of the Other part

WHEREAS:

(A)      The Bank has agreed to grant a loan to the Borrower in the amount of
         US$2.4 million upon having the same secured in the manner hereinafter
         appearing.

(B)      The proceeds of the loan shall be used by the Borrower to finance the
         cost of constructing a new reverse osmosis plant on land owned by the
         Water Authority of the Cayman Islands and described as the title to
         Cayman Islands registered Parcel 34 of Block 20B in the George Town
         East Registration Section of Grand Cayman. In order to secure
         repayment of the said sum, the Borrower has agreed to enter into this
         Debenture.

NOW THIS DEED WITNESSETH as follows:-

1.       INTERPRETATIONS AND DEFINITIONS

         (a)      In this Deed:

                  (i)      "Charged Assets"     means the goodwill,
                                                undertaking, property, assets,
                                                revenues and rights charged
                                                under sub-clause 4(a);

                  (ii)     "Charged Property"   means the property referred to
                                                in sub-clause 4(a)(i);

                  (iii)    "Default Rate"       means such rate of interest as
                                                shall be calculated by the Bank
                                                from time to time to be the sum
                                                of the Interest Rate, plus the
                                                excess cost of interest that
                                                the Bank would incur in funding
                                                the overdue amount in the London
                                                Interbank Market for such period
                                                as the Bank determines to be
                                                reasonable in the circumstances
                                                (as to which a certificate of
                                                the Bank shall be conclusive
                                                evidence) plus two Percentum
[SEAL]                                          (2%)Per annum;

                  (iv)     "Credit Facility"    Means the corresponding Credit
                                                Facility made available under
                                                the Loan Agreement;

                  (v)      "Events of Default"  means the events of default set
                                                out in clause 6; .

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                                      - 2 -

                  (vi)     "Interest Rate"      means the interest rate set out
                                                in sub-clause 3(a);

                  (vii)    "Loan Agreement"     means the Bank's commitment
                                                letter to the Borrower dated 2
                                                January 2002 (and agreed and
                                                accepted on behalf of the
                                                Borrower on 21 January 2002) as
                                                amended or substituted by
                                                agreement in writing by the Bank
                                                and the Borrower from time to
                                                time;

                  (viii)   "Principal Sum"      shall mean the demand loan in
                                                the sum of US$2,400,000.00 or
                                                so much thereof as is
                                                outstanding from time to time;

                  (ix)     "Receiver"           has the meaning given to it in
                                                sub-clause 10(a) and shall
                                                include any substituted
                                                receiver(s) and manager(s); and

                  (x)      "Securities"         means the property referred to
                                                in sub-clause 4(a)(ii).

         (b)      In this deed the expressions "the Borrower" and "the Bank"
                  where the context admits include their respective successors
                  and assigns whether immediate or derivative.

         (c)      Words importing any gender shall include any other gender and
                  words importing the singular number only shall include the
                  plural number and vice versa and words importing persons and
                  all references to persons shall include corporations and
                  firms.

         (d)      Unless the context otherwise requires, reference to clause,
                  sub-clause or schedule is to a clause, sub-clause or schedule
                  (as the case may be) of or to this deed.

         (e)      The clause headings do not form part of this deed, are for
                  convenience only and shall not be taken into account in its
                  construction or interpretation.

2.       COVENANT TO PAY MONEY

         (a)      The Borrower hereby covenants to repay to the Bank on demand
                  the Principal Sum together with:

                  (i)      interest to the date of repayment at such rates and
                           upon such terms as may from time to time be payable
                           hereunder;

                  (ii)     any commissions, fees and other charges charged by
                           the Bank to the Borrower; and

                  (iii)    all expenses incurred by the Bank in relation to the
                           Borrower or the preparation or enforcement of any
                           guarantees or security for any moneys, obligations or
                           liabilities hereby secured including legal and other
                           costs on a full indemnity basis.

         (b)      Pending the aforementioned demand, commencing 31st December
                  2002, the Borrower shall repay the aforementioned amounts by
                  way of equal semi-annual instalments of US$240,000.00 each
                  over a term of five (5) years. In the event a balance remains
                  at the end of the said term, the Bank reserves the right to
                  require a balloon payment.

3.       INTEREST

         (a)      The Interest Rate for each Interest Period shall be such rate
                  as shall be calculated by the Bank (as well after as before
                  judgement) to be one and one-half percent (1.5%) above the
                  three (3) month rate the Bank is offered funds in the London
                  Interbank Euro Dollar market in the approximate amount of

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                                      - 3 -

                  the monies drawn or to be drawn by the Borrower under the Loan
                  Agreement on or immediately before the date which is two (2)
                  business days before the beginning of such Interest Period.
                  The Interest Rate shall be established two (2) business days
                  Prior to each Interest Period "Interest Period" shall mean
                  each successive period of 90 days calculated from the date of
                  initial drawdown.

         (b)      The Borrower shall pay interest at the Interest Rate (or at
                  the Default Rate during the continuation of any Event of
                  Default) whether before or after judgement to the date of
                  payment on (i) all commission, fees and other charges and any
                  legal and other costs, charges and expenses incurred by the
                  Bank in relation to the Borrower or the assets charged under
                  this deed or in enforcing the security charged under this
                  deed; and (ii) all money and liabilities due under this deed;

         (c)      The aforementioned interest shall be paid quarterly in arrears
                  calculated from the date of initial drawdown on the basis of a
                  360 day year; provided that if any such interest payment
                  should fall due and payable on a day which is not a business
                  day, the payment shall be made on the next following business
                  day.

4.       FIXED AND FLOATING CHARGES

         (a)      As a continuing security for the payment of all money and the
                  discharge of all obligations and liabilities covenanted to be
                  paid or met or otherwise secured by the Borrower under this
                  deed the Borrower as beneficial owner hereby charges to the
                  Bank:

                  (i)      all freehold and leasehold property of the Borrower
                           (excluding the Borrower's Cayman Islands leasehold
                           property interest in Cayman Islands registered Parcel
                           34 of Block 20B in the George Town East Registration
                           Section of Grand Cayman (the "Red Gate Road Plant
                           Property") and Parcel 219 of Block 32B in the Lower
                           Valley Registration Section of Grand Cayman (the
                           "Lower Valley Plant Property")) both present and
                           future and all buildings and fixtures (including
                           trade fixtures), plant machinery, vehicles, computers
                           and office and other equipment of the Borrower
                           (which for the avoidance of doubt excludes the
                           seawater desalination plants operated by the Borrower
                           but which are not its property such as, at the date
                           hereof, the seawater desalination plants at the Red
                           Gate Road Property and the Lower Valley Property)
                           both present and future (excluding stock in trade of
                           the Borrower) from time to time on any such property
                           with the benefit of all existing and future leases,
                           underleases, tenancies and agreements relating to
                           such property (including all rents and profits from
                           such property) ("the Charged Property");

                  (ii)     all stocks, shares, bonds and securities of any kind
                           whether marketable or otherwise and all other
                           interests including (but not limited to) loan capital
                           of the Borrower both present and future in any
                           company, firm, consortium or entity including all
                           allotments, accretions, offices, rights, benefits and
                           advantages at any time accruing, offered or arising
                           in respect of or incidental to such stocks, shares,
                           bonds and securities and all stocks, shares, rights,
                           money or property accruing to them or offered at any
                           time by way of conversion, redemption, bonus,
                           preference, option or otherwise in respect of them
                           ("the Securities");

                  (iii)    all book and other debts, revenues and claims both
                           present and future (including things in action which
                           may give rise to a debt, revenue or claim) due or
                           owing or which may become due or owing to or
                           purchased or otherwise acquired by the Borrower
                           (including, without limitation, all payments due to
                           the Borrower from the Water Authority of the Cayman
                           Islands under a 26 October 2001 Contract with respect
                           to the procurement of and operating contract for a
                           sea water desalination plant at Red Gate Road, George
                           Town, Grand

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                                      - 4 -

                           Cayman) and the full benefit of all rights and
                           remedies relation to such book and other debts,
                           revenues and claims including (but not limited to)
                           any negotiable or non-negotiable instruments,
                           guarantees, indemnities, debentures, legal and
                           equitable charges and other security reservation of
                           proprietary rights, rights of tracing liens and all
                           other rights and remedies of any nature in respect of
                           such property;

                  (iv)     the uncalled capital, goodwill and all patents,
                           patent applications, trade marks, trade names,
                           registered designs and copyrights and all licences
                           and ancillary and connected rights relating to the
                           intangible property both present and future of the
                           Borrower;

                  (v)      the undertaking and all other assets of the
                           Borrower both present and future including (but not
                           limited to) the stock in trade of the Borrower and
                           the property described in sub-clauses 4(a)(i) to
                           4(a)(iv) (if and insofar as the charges on such
                           property or on any part or parts of such property
                           contained in this deed shall for any reason be
                           ineffective as fixed charges).

         (b)      The charges created by sub-clause 4(a) shall as regards the
                  property described in sub-clauses 4(a)(i) to 4(a)(iv) be fixed
                  charges and as to the property described in sub-clause
                  4(a)(v) shall be a first floating charge.

5.       RESTRICTIONS ON THE BORROWER

         (a)      The Borrower covenants that it will not (without the prior
                  consent in writing of the Bank):

                  (i)      sell, assign, discount, part or pledge, charge or
                           otherwise dispose of all or any part of the property
                           described in sub-clause 4(a)(iii) or deal with it
                           save in accordance with sub-clause 7(b)(xi); or

                  (ii)     (except for charges in favour of the Bank created
                           under this deed) create or attempt to create or
                           permit to subsist any mortgage, debenture, charge or
                           pledge or permit any lien or other incumbrance (save
                           a lien arising by operation of law in the ordinary
                           course of trading) to arise on or affect all or any
                           of the Charged Assets; or

                  (iii)    part with possession or transfer, sell, lease or
                           otherwise dispose of all or any of the Charged Assets
                           or attempt so to do (save in the case of assets
                           charged by way of floating charge only which may be
                           sold or otherwise disposed of in the usual course of
                           trading conducted at the date of this deed and for
                           the purpose of carrying on its business).

         (b)      Notwithstanding anything in this deed, if the Borrower
                  charges, pledges or otherwise incumbers, contrary to
                  sub-clause 5(a)(ii), any of the Charged Assets described in
                  sub-clause 4(a)(v) or attempts to do so without the prior
                  consent in writing of the Bank or if any creditor or other
                  person attempts to bring any distress, execution,
                  sequestration or other process against any of the Charged
                  Assets described in sub-clause 4(a)(v) the floating charge
                  created under this deed over those assets shall automatically
                  without notice operate as a fixed charge instantly on such
                  event occurring.

         (c)      During the continuance of this security the statutory and
                  other powers of leasing, letting, entering into agreements for
                  leases or lettings and accepting or agreeing to accept
                  surrenders of leases or tenancies shall not in relation to all
                  or any part of the Charged Assets be exercisable by the
                  Borrower nor shall the Borrower part with possession of all or
                  any part of the Charged Assets nor confer any licence, right
                  or interest to occupy nor grant any licence or permission to
                  assign, underlet or part with possession of all or any part
                  of the Charged Assets nor agree, suffer or permit any
                  variation or addition to the terms of any lease, tenancy or
                  licence without in every such case obtaining the prior consent
                  in writing of the Bank, save as permitted by sub-clause
                  5(a)(iii) above.

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                                      - 5 -

6.       EVENTS OF DEFAULT

         (a)      The Bank shall cease to be under any further commitment to the
                  Borrower and all money and liabilities secured under this deed
                  shall immediately become due and payable on demand and the
                  security shall become enforceable and if so required by the
                  Bank the Borrower shall immediately provide cash cover on
                  demand or a guarantee acceptable to the Bank for all
                  contingent liabilities of the Borrower to the Bank and for all
                  notes or bills, bonds, guarantees, indemnities and all
                  instruments entered into or agreed to be entered into by the
                  Bank for or at the request of the Borrower on the occurrence
                  of any of the following Events of Default:

                  (i)      if the Borrower fails to pay any sum which may from
                           time to time become due to the Bank on the due date
                           or fails to comply with any provision or to meet any
                           obligation or liability contained or incorporated
                           herein or in any facility from or other agreement
                           with the Bank;

                  (ii)     if the Borrower is in breach of any agreement,
                           covenant, condition or other provision, express or
                           implied, in or under any other agreement, deed or
                           document from time to time entered into between the
                           Borrower and the Bank (including without limitation
                           under the Loan Agreement or under any charge
                           registered in favour of the Bank over the Charged
                           Property pursuant to the Registered Land Law (1995
                           Revision) or any statutory modification or
                           re-enactment thereof) or any other obligation or duty
                           it may from time to time be under to the Bank
                           generally;

                  (iii)    if any representation, warranty, certificate or
                           undertaking made by the Borrower to the Bank from
                           time to time is or becomes incorrect or misleading in
                           any material respect;

                  (iv)     if the Borrower defaults or receives notice of
                           default under any trust deed, loan agreement,
                           debenture or any other agreement, deed or document or
                           any other obligation relating to borrowing or under
                           any guarantee or indemnity or if any borrowing or
                           other money payable under any borrowing or guarantee
                           or indemnity becomes or is capable of being declared
                           payable prior to its stated maturity or is not paid
                           when due or any incumbrances from time to time
                           created by the Borrower become enforceable;

                  (v)      if a petition is presented or an order made or a
                           resolution passed or analogous proceedings are taken
                           for appointing an inspector of or winding up the
                           Borrower or for dissolution or if the Borrower is
                           struck off the Register of Companies or a notice is
                           issued convening a meeting for the purpose of passing
                           any such resolution (save for the purpose of and
                           followed by an amalgamation or reconstruction not
                           involving insolvency on terms previously approved in
                           writing by the Bank);

                  (vi)     if an encumbrancer shall take possession or exercise
                           or attempt to exercise any power of sale or a
                           Receiver shall be appointed of the whole or any part
                           of the undertaking, property or assets of the
                           Borrower;

                  (vii)    if any judgment or order made against the Borrower is
                           not complied with within seven days or if an
                           execution, distress, sequestration or other process
                           is levied or enforced upon or sued out against any
                           part of the undertaking, property or assets or
                           revenues of the Borrower;

                  (viii)   if the Borrower fails to pay its debts as and when
                           they fall due or becomes or is deemed to be insolvent
                           or unable to pay its debts whether within the meaning
                           of Section 95 of the Companies Law (2001 Second
                           Revision) or otherwise or the Borrower proposes or

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                                      - 6 -

                           enters into any composition or arrangement with its
                           creditors generally or any class of its creditors;

                  (ix)     if the Borrower without the prior written consent of
                           the Bank ceases or threatens to cease to carry on its
                           business or any part thereof the Bank considers
                           material in the normal course or changes the nature
                           or mode of conduct of its trading in any respect
                           which the Bank may consider material;

                  (x)      if the undertaking, property or assets of the
                           Borrower or any part thereof from time to time
                           considered by the Bank to be material is sold,
                           disposed of or compulsorily acquired (otherwise than
                           in the normal course of trading for the purpose of
                           carrying on business or on terms previously approved
                           in writing by the Bank) whether in a single
                           transaction or a number of transactions or is
                           nationalised, seized, forfeited or appropriated;

                  (xi)     if any guarantee, indemnity or other security created
                           in favour of the Bank is in jeopardy or is not or
                           ceases to be in full force and effect or is voidable
                           or unenforceable or is disputed, revoked or
                           terminated or it becomes unlawful or impossible for
                           the Bank to exercise any right or power vested in it
                           under any such security and is considered by the Bank
                           to be material;

                  (xii)    if any licence, authorisation, consent or
                           registration necessary or desirable to enable the
                           Borrower to comply with its obligations to the Bank
                           or to carry on its business in the normal course
                           shall be revoked, withheld, materially modified or
                           fail to be granted or perfected or shall cease to
                           remain in full force and effect;

                  (xiii)   if by or under the operation of any Government the
                           management of the Borrower or its authority in the
                           conduct of its business is curtailed to the point of
                           making it effectively inoperative by any seizure or
                           intervention or proceedings of any nature;

                  (xiv)    If the Borrower makes or attempts to make any
                           alterations to the provisions of its Memorandum or
                           Articles of Association which might, in the opinion
                           of the Bank, affect its interests hereunder or shall
                           fail or neglect to comply with any or all of the
                           provisions of the Companies Law (2001 Second
                           Revision) or any statutory modification or
                           re-enactment thereof or any other of the laws of the
                           Cayman Islands in so far as the same may relate to
                           it;

                  (xv)     if the Borrower shall without obtaining the prior
                           written consent of the Bank by its directors,
                           shareholders or otherwise declare and pay any
                           dividends or capital distributions or repay any
                           shareholder loans or any capital or make any capital
                           expenditure whatever or make any other expenditures
                           otherwise than in the ordinary course of business or
                           permit or cause to be done anything that will result
                           in any change in the shareholdings as constituted on
                           the date hereof;

                  (xvi)    if control of the Borrower is acquired by any person
                           or company or group of connected persons not having
                           control of the Borrower at the date hereof (unless
                           with the prior consent in writing of the Bank not to
                           be unreasonably withheld) where "control" means the
                           power of any person or company or group of connected
                           persons to control the composition of the Board of
                           Directors of the Borrower or otherwise secure
                           (whether through the holding of shares directly or
                           through nominees, the possession of voting power or
                           by virtue of any powers conferred by the Memorandum
                           or Articles of Association of the Borrower or any
                           other document or agreement) that the affairs of the
                           Borrower are conducted in accordance with the wishes
                           of that person or company or group of connected
                           persons;

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                                      - 7 -

                  (xvii)   if any of the foregoing events occurs in relation to
                           (i) any third party which now or hereafter has
                           guaranteed or provided security for or given an
                           indemnity in respect of any money, obligation or
                           liability hereby secured or (ii) any subsidiary or
                           holding company of the Borrower or of any such third
                           party or (iii) any subsidiary of any such holding
                           company or if any individual now or hereafter liable
                           as such third party shall commit an act of
                           bankruptcy, die or become of unsound mind;

                  (xviii)  if the Borrower shall without the prior consent in
                           writing of the Bank create or purport or attempt to
                           create any mortgage, pledge, lien, charge, assignment
                           or other encumbrance ranking or which by any means
                           may come to rank in whole or in part pari passu with
                           or in priority to or subordinate to any of the
                           charges hereby created;

                  (xix)    if in any country in which the Borrower carries on
                           business or has assets any event occurs which
                           corresponds with or has an effect similar to any of
                           the foregoing events or if the Borrower becomes
                           subject to proceedings or an order, appointment or
                           filing under the insolvency laws of such country, or

                  (xx)     if at any time the Borrower shall in good faith
                           determine that a material adverse change in the
                           financial condition of the Borrower has occurred or
                           that the Borrower is unlikely to be able to meet any
                           of its obligations hereunder.

         (b)      The Borrower hereby covenants immediately to notify the Bank
                  in writing of the occurrence of any of the Events of Default
                  specified in clause 6(a) or of the occurrence of any event
                  which with the lapse of time or giving of notice would or may
                  constitute an Event of Default.

7.       COVENANTS BY THE BORROWER

         (a)      The Borrower hereby represents and warrants to the Bank that
                  (i) it is a duly organised corporation existing in good
                  standing under the Laws of the Cayman Islands, (ii) it is duly
                  qualified to do business wherever necessary to carry on its
                  present operations, (iii) the making and performance of this
                  Debenture is within its powers having been duly authorised by
                  all necessary governmental and corporate approvals and does
                  not contravene any law or any contractual restriction binding
                  on the Borrower or the Memorandum and Articles of Association
                  of the Borrower, (iv) this Debenture is a legal, valid and
                  binding obligation of the Borrower enforceable against the
                  Borrower in accordance with its terms, and (v) there are no
                  pending or threatened actions or proceedings before any court
                  or administrative agency which may materially adversely affect
                  the Borrower or its financial conditions and operations.

         (b)      The Borrower hereby further covenants with the Bank that
                  during the continuance of this security the Borrower will at
                  all times and as applicable immediately:

                  (i)      notify the Bank by fax and confirm in writing of the
                           occurrence of any event which will or may in due
                           course constitute an Event of Default;

                  (ii)     conduct and carry on its business in a proper,
                           efficient and business-like manner and not make any
                           substantial alteration in the nature of or mode of
                           conduct of that business and keep or cause to be kept
                           proper books of account relating to such business;

                  (iii)    pay into such account as the Bank may direct all
                           money which it shall receive in respect of book or
                           other debts and without prejudice to the provisions
                           of this deed the Borrower shall not without the prior
                           consent of the Bank sell, factor, discount, charge or
                           assign any assets described in sub-clause 4(a)(iii)
                           or purport to do so and shall if called

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                                      - 8 -

                           upon by the Bank from time to time execute legal
                           assignments of any book or other debts to the Bank;

                  (iv)     observe and perform all covenants and stipulations
                           from time to time affecting its freehold or leasehold
                           property or the mode of user or enjoyment of such
                           property and not, without the prior consent in
                           writing of the Bank, enter into any onerous or
                           restrictive obligations affecting any such property
                           nor do or suffer or omit to be done any act, matter
                           or thing which would infringe any provision of any
                           statute, order or regulation from time to time in
                           force affecting any such property;

                  (v)      observe and perform all covenants and stipulations
                           from time to time affecting its patents, patent
                           applications, trade marks, trade names, registered
                           designs and copyrights and all other industrial or
                           intangible property or any licence or ancillary or
                           connected rights from time to time relating to
                           industrial or intangible property and preserve and
                           maintain and renew when necessary or desirable all
                           such licences and rights;

                  (vi)     use its best endeavours to enforce and, at its own
                           cost, institute, continue or defend all proceedings
                           relating to any of the Charged Assets;

                  (vii)    keep all buildings and erections and all plant,
                           machinery, fixtures, fittings, vehicles, computers
                           and office and other equipment and every part of such
                           property in good and substantial repair and in good
                           working order and condition and not pull down or
                           remove or sell or otherwise dispose of any of such
                           property without the prior consent in writing of the
                           Bank except in the ordinary course of use, repair,
                           maintenance or improvement. If the Borrower is at any
                           time in default in complying with this covenant the
                           Bank shall be entitled but not bound to repair and
                           maintain such property with power for the Bank, its
                           agents and their respective employees to enter any of
                           the Borrower's property for that purpose or to
                           inspect that property and any sum so expended by the
                           Bank shall be repayable by the Borrower to the Bank
                           on demand together with interest at the Default Rate
                           from the date of payment by the Bank;

                  (viii)   at its own expense insure and keep insured any of the
                           Charged Assets of an insurable nature with insurers
                           previously approved by the Bank in writing against
                           loss or damage by fire, burglary, theft, civil
                           commotion, explosion, aircraft, flood, storm,
                           tempest, lightning, burst pipes and such other risks
                           and contingencies as the Bank shall from time to time
                           request to the full replacement value of such assets
                           from time to time including fees of architects,
                           surveyors, engineers and all other professional fees
                           and demolition charges together (in the case of
                           leasehold properties) with loss of rent for 3 years
                           in the joint names of the Borrower and the Bank or,
                           at the option of the Bank, in the name of the
                           Borrower. The interest of the Bank shall be noted on
                           the policy and the policy shall contain such
                           provisions for the protection of the Bank as the
                           Bank may reasonably require. The Borrower must
                           maintain such other insurance policies (with the
                           interest of the Bank noted on such policies)
                           containing like provisions for the protection of the
                           Bank as are normally maintained by prudent companies
                           carrying on similar businesses. The Borrower shall
                           pay within one week of them becoming due all premiums
                           and other money necessary for effecting and keeping
                           up such insurances and on demand produce to the Bank
                           the policies of such insurance and proof of such
                           payments failing which the Bank may take out or renew
                           such insurances in any sum which the Bank may think
                           expedient and all money expended by the Bank under
                           this provision shall be reimbursed by the Borrower on
                           demand and bear interest at the Default Rate from the
                           date of

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                                      - 9 -

                           payment by the Bank up to the date of payment by the
                           Borrower. All money to be received by virtue of any
                           insurance maintained or effected by the Borrower on
                           the Charged Assets (whether or not in pursuance of
                           the obligations under this sub-clause) shall be paid
                           to the Bank (or if not paid by the insurers directly
                           to the Bank held on trust for the Bank) and shall at
                           the option of the Bank be applied in reduction of the
                           money obligations and liabilities secured under this
                           deed or in replacing, restoring or reinstating the
                           property or assets destroyed, damaged or lost (any
                           deficiency being made good by the Borrower);

                  (ix)     punctually pay and indemnify the Bank and any
                           Receiver appointed by it against all existing and
                           future rent, rates, taxes, duties, charges,
                           assessments, impositions and outgoings (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
                           all or any part of the Charged Assets or by the owner
                           or occupier of those assets. If any such sums shall
                           be paid by the Bank or by any such Receiver then the
                           sums shall be repaid by the Borrower on demand with
                           interest at the Default Rate from the date of
                           payment by the Bank or any such Receiver;

                  (x)      not (without the prior written consent of the Bank)
                           vary, surrender, cancel, assign, charge or otherwise
                           dispose of or permit to be forfeit any lease of
                           leasehold premises or any credit, sale, hire
                           purchase, rental or like agreement for any equipment
                           used in its business considered by the Bank to be
                           material and generally fulfil its obligations under
                           every such lease and agreement and when required,
                           produce to the Bank proof of all payments from time
                           to time due from the Borrower under such lease or
                           agreement;

                  (xi)     get in and realise all book and other debts and
                           claims charged under this deed in the ordinary
                           course of its business and pay into such account as
                           the Bank shall from time to time direct all money
                           which it may receive in respect of those book and
                           other debts and claims immediately on receipt and
                           pending such payment hold such money on trust for the
                           Bank (provided that the Company may use the same in
                           the usual course of trading conducted at the date of
                           this deed and for the purposes of carrying on the
                           business) and not (without the prior consent in
                           writing of the Bank) charge or otherwise dispose of
                           or release, exchange, compound, set off or grant time
                           or indulgence or otherwise deal with all or any of
                           those book and other debts and claims or purport so
                           to do;

                  (xii)    not (without the prior consent in writing of the
                           Bank) form or co-operate in the formation of,
                           purchase or acquire any new subsidiary, permit any
                           subsidiary to issue any share or loan capital except
                           to the Borrower or to a wholly-owned subsidiary of
                           the Borrower or transfer assets hereby charged to any
                           subsidiary save on terms previously approved in
                           writing by the Bank;

                  (xiii)   not do or cause or permit to be done anything which
                           may in any way depreciate, jeopardise or otherwise
                           prejudice the value to the Bank of the security
                           hereby charged and not (without the prior consent in
                           writing of the Bank) incur any expenditure or
                           liabilities of an exceptional or unusual nature;

                  (xiv)    deposit with the Bank, its solicitors or a nominee of
                           the Bank and permit the Bank, its solicitors or its
                           nominee during the continuance this security to hold
                           and retain the following:

                           I.       all deeds and documents of title relating to
                                    all freehold and leasehold property from
                                    time to time belonging to the

<PAGE>

                                     - 10 -

                                    Borrower (and the insurance policies
                                    relating to such property) excluding any in
                                    respect of the Red Gate Road Plant Property
                                    and the Lower Valley Plant Property;

                           II.      all stock and share certificates and
                                    documents of title relating to the
                                    Securities and such deeds of transfer in
                                    blank and other documents as the Bank may
                                    from time to time require for perfecting its
                                    title to the Securities (executed by or
                                    signed on behalf of the registered holder)
                                    or for vesting or enabling it to vest the
                                    Securities in itself or its nominees or in
                                    any purchaser;

                           III.     all assurance policies from time to time
                                    effected by the Borrower on the lives of key
                                    employees; and

                           IV.      all such documents relating to the Charged
                                    Assets as the Bank may from time to time
                                    require; and

                  (xv)     not (without the prior consent in writing of the
                           Bank) permit any person (i) to be registered as
                           proprietor of any freehold or leasehold property
                           present or future from time to time hereby charged
                           nor create or permit to arise any overriding interest
                           affecting such property, or (ii) to become entitled
                           to any proprietary right or interest which might
                           affect the value of any land, fixtures or fixed plant
                           and machinery hereby charged.

8.       FURTHER SECURITY

         The Borrower shall at any time if and when required by the Bank execute
         such further legal or other mortgages, fixed or floating charges or
         assignments in favour of the Bank as the Bank shall from time to time
         require over all or any of the Charged Assets both present and future
         to secure all moneys, obligations and liabilities covenanted under this
         deed to be paid or otherwise secured under this deed, such further
         mortgages, charges or assignments to be prepared by or on behalf of the
         Bank at the cost of the Borrower and to contain an immediate power of
         sale without notice and such other clauses for the benefit of the Bank
         as the Bank may reasonably require.

9.       Powers of the Bank

         At any time after the Bank shall have demanded payment or discharge of
         any money, obligation or liability hereby secured, in addition to all
         other powers or rights vested in it by law or otherwise, the Bank may,
         without any notice except as hereinafter provided and whether or not it
         shall have appointed a Receiver, enter into possession and sell all or
         any of the goodwill, undertaking, assets, rights and property hereby
         charged (provided that, in the case of the charge over the Charged
         Assets described in clause 4(a)(v), such charge shall, prior to the
         exercise of such power, operate as a fixed charge) or any part thereof
         at public or private sale or in any other manner and for such
         consideration and generally on such terms and conditions as the Bank
         may think fit. Upon any such sale, the Bank shall have the right to
         deliver, assign and transfer to each purchaser thereof such goodwill,
         undertaking, assets, rights or property in the name and on behalf of
         the Borrower. Each purchaser at any such sale shall hold the property
         so sold absolutely free from any equity or right of redemption of the
         Borrower who hereby specifically waives all rights of redemption, stay
         or appraisal which the Borrower has or may have under any rule or law
         or statute now existing or hereinafter adopted. The Bank shall give to
         the Borrower ten days written notice of its intention to make any such
         public or private sale. Such notice in case of public sale shall state
         the time and place fixed for such sale and in case of private sale the
         day on which such goodwill, undertaking, assets, rights and property or
         that portion thereof so being sold will first be offered for sale. Any
         such public sale shall be held at such time or times within ordinary
         business hours and at such place as the Bank may fix in the notice of
         such sale. At such sale, such goodwill, undertaking, assets, rights and
         property may be sold in one lot as an entirety or in separate parcels
         as the Bank may determine. The Bank shall not be obliged to make any
         public or private sale and may cause the same to be adjourned from time
         to time by announcement at the time and place fixed for the

<PAGE>

                                     - 11 -

         sale and such sale may be made at any time or place to which the same
         may be so adjourned. In case of any sale on credit or for future
         delivery the undertaking, assets, rights and property so sold may be
         retained by the Bank until the selling price is paid by each purchaser
         thereof but the Bank shall incur no liability in the case of the
         failure of such purchaser to take up and pay for such undertaking,
         assets, rights and property so sold and in case of any such failing
         such undertaking, assets, rights and property may again be sold upon
         like notice. The Bank instead of exercising the power of sale herein
         conferred upon it may proceed by a suit or suits at law or in equity to
         foreclose this Debenture and sell all or any of the goodwill,
         undertaking, property, assets and rights hereby charged or any part
         thereof under a judgment or decree of a court or courts of competent
         jurisdiction, the Borrower having been given due notice of all such
         action.

10.      APPOINTMENT AND POWERS OF RECEIVER

         (a)      At any time after the Bank shall have demanded payment or
                  discharge of any money, obligation or liability hereby secured
                  and the same shall not have been satisfied in full or if
                  requested by the Borrower, the Bank may in writing under its
                  common seal or under the hand of any director, officer or
                  manager for the time being of the Bank appoint any person to
                  be a Receiver of the undertaking, property, assets and rights
                  hereby charged or any part thereof (with power to authorise
                  any joint receiver to exercise any power independently of any
                  other joint receiver) and may remove any Receiver so appointed
                  and appoint another in his place. In addition to all other
                  powers vested in him by law or otherwise a Receiver shall have
                  the power on behalf and at the cost of the Borrower to do or
                  omit to do anything in relation to the undertaking, property
                  or assets charged hereby or any part thereof and in particular
                  (but without limitation), the following powers:-

                  (i)      to take possession of, collect and get in and give
                           receipts binding on the Borrower for all or any
                           property, assets and rights hereby charged and to
                           bring, defend or discontinue any proceedings or
                           submit to arbitration in the name of the Borrower or
                           otherwise as may seem expedient;

                  (ii)     to make calls conditionally or unconditionally on the
                           members of the Borrower in respect of uncalled
                           capital;

                  (iii)    to carry on, manage, develop, reconstruct, amalgamate
                           or diversify or authorise or concur in any such
                           action relating to, the business of the Borrower or
                           any part thereof and to exercise in respect of the
                           Securities, all voting or other powers or rights
                           available to a registered holder thereof in such
                           manner as he may think fit and to manage and conduct
                           the same without being responsible for loss or damage
                           and for any of those purposes to raise or borrow any
                           money from or incur any liability to the Bank or
                           others on such terms with or without security as he
                           may think fit and so that any such security may be
                           or include a charge on the whole or any part of the
                           property hereby charged ranking in priority to this
                           security or otherwise;

                  (iv)     whether forthwith or later, to sell or concur in
                           selling by public auction or private contract, and to
                           let or concur in letting and to accept surrenders,
                           grant licences or otherwise dispose of or deal with
                           all or any of the goodwill, undertaking, assets,
                           rights and property hereby charged in such manner and
                           for such consideration and generally on such termS
                           and conditions as the Receiver may think fit with
                           full power to convey or otherwise transfer such
                           goodwill, undertaking, assets, rights or property in
                           the name and on behalf of the Borrower or other the
                           estate owner and any such sale may be for cash,
                           debentures or other obligations, shares, stocks or
                           other valuable consideration and may be payable in a
                           lump sum immediately or by instalments spread over
                           such period as the Receiver shall think fit and so
                           that any consideration received in a form other than
                           cash shall ipso facto forthwith on receipt be and
                           become charged with the payment

<PAGE>

                                     - 12 -

                           of all moneys, obligations and liabilities secured
                           hereby. Plant, machinery and other fixtures may be
                           severed and sold separately from the premises
                           containing them without the consent of the Borrower
                           being obtained thereto;

                  (v)      to make any arrangements or compromise, allow time
                           for payment or enter into, abandon, cancel or
                           disregard any contracts which he shall think
                           expedient in the interests of the Bank;

                  (vi)     to make and effect all repairs, improvements and
                           renew such of the plant, machinery, chattels and
                           property of the Borrower as he shall think fit and
                           maintain, renew, take out or increase insurances;

                  (vii)    to promote the formation of companies with a view to
                           the same purchasing, leasing, licensing or otherwise
                           acquiring all or any of the goodwill, undertaking,
                           property, assets or rights of the Borrower or
                           otherwise;

                  (viii)   without any further consent by or notice to the
                           Borrower, exercise on behalf of the Borrower all the
                           powers, rights and provisions conferred on a landlord
                           or a tenant at law or under any lease, sub-lease or
                           other contract or agreement to which the Borrower is
                           a party relating to rents or otherwise in respect of
                           any part of the property hereby charged but without
                           any obligation to exercise any of such powers and
                           without any liability in respect of powers so
                           exercised or omitted to be exercised;

                  (ix)     to appoint managers, accountants, lawyers, agents,
                           officers, servants and workmen for any of the
                           aforesaid purposes at such salaries or remuneration
                           and for such periods and upon such terms as he or
                           they may determine; and

                  (x)      to sign any document, execute any deed and do all
                           such other acts and things as may be considered to be
                           incidental or conducive to any of the matters and
                           powers aforesaid and which he may and can lawfully do
                           as agent for the Borrower.

         (b)      All money received by such Receiver or by the Bank in the
                  exercise of any powers conferred by this Debenture shall be
                  applied after the discharge of any taxes or the remuneration
                  and expenses of such Receiver and all liabilities having
                  priority thereto in or towards satisfaction of such of the
                  moneys, obligations and liabilities hereby secured and in such
                  order as the Bank in its absolute discretion may from time to
                  time conclusively determine.

         (c)      A Receiver appointed by the Bank shall be the agent of the
                  Borrower and the Borrower shall alone be solely responsible
                  and liable for his acts, defaults or remuneration.

         (d)      Neither the Bank nor any Receiver shall be liable to account
                  as mortgagee in possession in respect of all or any of the
                  property charged hereby nor be liable for any loss upon
                  realisation or for any neglect or default or omission of any
                  nature whatsoever for which a mortgagee in possession might be
                  liable.

         (e)      No purchaser, chargor or chargee or other person or company
                  dealing with the Bank or with any Receiver appointed by it or
                  with its or his, attorneys or agents shall be bound or
                  concerned to see or enquire whether the powers exercised or
                  purported to be exercised have become exercisable or whether
                  any money remains due actually or contingently on the security
                  of this Debenture or as to the necessity or expediency of the
                  stipulations and conditions subject to which any sale shall
                  have been made or otherwise as to the propriety or regularity
                  of such sale, calling in, collection or conversion or to see
                  to the application of any money paid to the Bank and in the
                  absence of mala fides on the part of such purchaser,
                  mortgagor, mortgagee or other

<PAGE>

                                     - 13 -

                  person or company such dealing shall be deemed so far as
                  regards the safety and protection of such purchaser, chargor,
                  chargee person or company to be within the powers hereby
                  conferred and to be valid and effectual accordingly.

         (f)      The Borrower hereby covenants with the Bank on demand to pay
                  all costs, charges and expenses incurred by the Bank or by any
                  Receiver appointed by it in the exercise of any powers
                  conferred by this Debenture or which they or he shall properly
                  incur in or about the preservation or attempted preservation
                  of this security or of the goodwill, undertaking, property,
                  assets and rights hereby charged with interest at the highest
                  rate payable by the Borrower to the Bank.

11.      POWER OF ATTORNEY

         The Borrower by way of security hereby irrevocably appoints the Bank
         and the persons deriving title under it and any Receiver appointed
         hereunder jointly and also severally to be its attorney to execute and
         complete in favour of the Bank or its nominees or of any purchaser any
         documents which the Bank may require for perfecting its title to or for
         vesting the Securities or any property, assets or rights hereby charged
         or agreed to be charged in the Bank or its nominees or in any purchaser
         and otherwise generally for it and in its name and on its behalf and as
         its act and deed or otherwise to execute, seal and deliver and
         otherwise perfect and do any such legal or other mortgage, charge or
         assignment as aforesaid and all such deeds, assurances, agreements,
         instruments, acts and things which may be required for the full
         exercise of all or any of the powers hereby conferred or which may be
         deemed proper on or in connection with any sale or other disposition
         thereof or any of the purposes aforesaid. The Borrower hereby ratifies
         and confIrms and agrees to ratify and confirm any instrument, act or
         thing which any such attorney may execute or do.

12.      CONTINUING SECURITY

         (a)      This security shall be a continuing security notwithstanding
                  any settlement of account or other matter whatsoever and is in
                  addition to and shall not merge or otherwise prejudice or
                  affect any other right or remedy of the Bank or the security
                  created by any deposit of documents or any guarantee, lien,
                  pledge, bill, note, mortgage or other security now or
                  hereafter held by or available to the Bank and shall not be in
                  any way prejudiced or affected thereby or by the invalidity
                  thereof or by the Bank now or hereafter dealing with,
                  exchanging, releasing, modifying or abstaining from,
                  perfecting or enforcing any of the same or any rights which it
                  may now or hereafter have or giving time for payment or
                  indulgence or compounding with any other person liable.

         (b)      It shall be lawful for but not obligatory on the Bank to
                  advance and pay all sums of money necessary for the purpose of
                  remedying any breach or breaches of covenants or obligations
                  whether imposed on the Borrower under the provisions of this
                  Debenture or any collateral or additional charges or
                  securities hereto or implied by law and all monies so paid and
                  all costs and expenses incurred by the Bank in relation to any
                  payment or act by or on behalf of the Bank shall be repayable
                  on demand and in addition to the other monies hereby secured
                  and shall bear interest at the Default Rate.

13.      CURRENCY

         (a)      All moneys received or held by the Bank or by a Receiver under
                  this Debenture may from time to time after demand has been
                  made by the Bank be converted into such other currency as the
                  Bank considers necessary or desirable to cover the obligations
                  and liabilities (actual or contingent) of the Borrower in that
                  other currency at the then prevailing spot rate of exchange of
                  the Bank (as conclusively determined by the Bank) for
                  purchasing that other currency with the existing currency.

         (b)      Neither the Bank nor any Receiver shall be liable to the
                  Borrower for any loss resulting from any fluctuation in
                  exchange rates before or after the exercise of any of the
                  powers under this Debenture.

<PAGE>

                                     - 14 -

         (c)      No payment to the Bank (whether under any judgment or court
                  order or otherwise) shall discharge the obligation or
                  liability of the Borrower in respect of which it was made
                  unless and until the Bank shall have received payment in full
                  in the currency in which such obligation or liability was
                  incurred and to the extent that the amount of any such payment
                  shall on actual conversion into such currency fall short of
                  such obligation or liability (actual or contingent) expressed
                  in that currency, the Bank shall have a further separate cause
                  of action against the Borrower and shall be entitled to
                  enforce the charges hereby created to recover the amount of
                  the shortfall.

14.      INDEMNITY

         The Borrower hereby agrees to indemnify both the Bank and any Receiver
         against all losses, actions, claims, expenses, demands and liabilities
         whether in contract, tort, equity or otherwise now or hereafter
         incurred by it or him or by any manager, officer, director or employee
         for whose liability, act or omission it or he may be answerable,
         responsible or liable for anything done or omitted in tile exercise or
         purported exercise of the powers herein contained or occasioned by any
         breach by the Borrower or any of its covenants or other obligations to
         the Bank. The Borrower shall so indemnify the Bank and any such
         Receiver on demand and shall pay interest on the sums demanded at the
         Default Rate.

15.      MISCELLANEOUS

         (a)      Any statutory or other powers of granting or agreeing to grant
                  or of accepting or agreeing to accept surrenders of leases or
                  tenancies of the property hereby charged or any part thereof
                  shall not during the continuance of this security be capable
                  of being exercised by the Borrower without the prior written
                  consent of the Bank.

         (b)      No neglect, omission or forbearance on the part of the Bank to
                  take advantage of or enforce any right or remedy arising out
                  of any breach or non-observance or any covenant or condition
                  herein or in any collateral or additional charges or
                  securities hereto contained or implied shall be deemed to be
                  or operate as a general waiver of such covenant or condition
                  or the right to enforce or take advantage of the same in
                  respect of any breach or non-observance thereof either
                  original or recurring.

         (c)      Each of the provisions of this Debenture is severable and
                  distinct from the others and if at any time one or more of
                  such provisions is or becomes invalid, illegal or
                  unenforceable, the validity, legality and unenforceability of
                  the remaining provisions hereof shall not in any way be
                  affected or impaired thereby.

         (d)      Any demand or notice hereunder may, without prejudice to any
                  other effective mode of making the same, be deemed to have
                  been properly and effectively made, given and served to and on
                  the Borrower at any time by a letter sent to them by
                  registered post addressed to its registered office and signed
                  by the Bank or any manager, officer, director, secretary,
                  attorney, agent or lawyer on its behalf and every such demand
                  or notice posted in the Cayman Islands shall be deemed to have
                  been given and served 7 days following the posting thereof.
                  Any such notice or demand or any certificate as to the amount
                  at any time secured hereby shall be conclusive and binding
                  upon the Borrower if signed by an officer of the Bank.

         (e)      This Debenture shall, at the Borrower's expense, be impressed
                  in the first instance with the stamp duty due under the Stamp
                  Duty Law (2001 Revision) as amended as at the date hereof) to
                  cover the Principal Sum of US$2,400,000.00 secured hereby but
                  the Bank shall be at liberty and is hereby empowered at any
                  time or times hereafter (without any further licence or
                  consent on the part of the Borrower) to impress additional
                  stamp duty hereon or on any collateral or additional charges
                  or securities hereto at the Borrower's own cost and expense to
                  cover any sum or sums by which the Borrower's indebtedness to
                  the Bank may exceed the said amount and in the event of such
                  upstamping as aforesaid the Borrower hereby covenants and
                  agrees with the Bank that this Debenture and the property
                  hereby charged

<PAGE>

                                     - 15 -

                  and the properties comprised in any collateral or additional
                  charges or securities hereto shall stand security for such
                  additional sum or sums and be charged with the payment thereof
                  and all other monies including interest due hereunder.

16.      GOVERNING LAW

         This Debenture shall be governed and construed solely according to the
         laws of the Cayman Islands and the parties hereby submit to the
         non-exclusive jurisdiction of the Courts of the Cayman Islands.

<PAGE>

                                     - 16 -

IN WITNESS WHEREOF the parties hereto have caused this Debenture to be executed
as a Deed the day and the year first above written.

EXECUTED AS A DEED by            )
OCEAN CONVERSION                 ) /s/ [ILLEGIBLE]
(CAYMAN) LIMITED in the          ) -------------------------
presence of:-                    ) Director
                                 )
/s/ [ILLEGIBLE]                  ) /s/ [ILLEGIBLE] for CAMPBELL SECRETARIES LIMI
-----------------------------    ) --------------------------
Witness                            Assistant Secretary

EXECUTED AS A DEED by The        )
Bank of N.T. Butterfield &       ) /s/ [ILLEGIBLE]
Son Ltd.                         ) --------------------------
in the presence of:-             ) Director Officer
                                 )
/s/ [ILLEGIBLE]                  ) __________________________
------------------------------   ) Director/Secretary
Witness                          )

                                                                          [SEAL]

<PAGE>

                                     - 17 -

I, John Wolf of Campbells, 4th Floor, Scotiabank Building, P.O. Box 884GT,
George Town, Grand Cayman, make oath and say:-

1.       That the foregoing Debenture bearing the date 29th day of May, 2002
         between Ocean Conversion (Cayman) Limited ("the Borrower") of the one
         part and The Bank of N. T. Butterfield & Son Ltd. of the other part
         was executed by the Borrower on the 11th day of April 2002.

2.       I was present and did see William T. Andrews a duly authorised Director
         and Melanie Jackson for and on behalf of Campbell Secretaries Limited
         the duly authorised Assistant Secretary of the Borrower execute the
         said Debenture as a deed for the purposes therein mentioned on the 11th
         day of April 2002 between the hours of 4.00 p.m. and 4.30 p.m. in the
         afternoon at George Town, Grand Cayman, Cayman Islands.

3.       The Borrower is a company formed under the Companies Law of the Cayman
         Islands with registered office situate at Campbell Corporate Services
         Ltd., P.O. Box 268 GT, Scotiabank Building, George Town, Grand Cayman,
         Cayman Islands.

4.       That the name subscribed as a witness attesting to tile due execution
         of the said Debenture by the Borrower is of the proper handwriting of
         me this deponent and I reside at No. 13 Pirates Lair, South Sound,
         Grand Cayman, Cayman Islands and I am an attorney-at-law.

                        _______________________________
                                     Witness

SWORN at George Town, Grand Cayman, Cayman Islands this 29th day of May 2002
before me.

                     _____________________________________
                         NOTARY PUBLIC - CAYMAN ISLANDS<PAGE>

                                                                   EXHIBIT 10.31

                                   DEBENTURE

THIS DEBENTURE is made the           day of                        2002 BETWEEN:

(1)      OCEAN CONVERSION (BVI) LTD., a company incorporated under the laws of
         the British Virgin Islands, whose registered office is at the offices
         of McNamara Corporate Services Limited, 2nd Floor, 116 Main Street,
         P O Box 3342, Road Town, Torto1a, British Virgin Islands (the
         "BORROWER"); and

(2)      THE BANK OF N.T. BUTTERFIELD & SON LIMITED, a bank organised and
         existing under the laws of the island of Bermuda, whose registered
         office is at 65 Front Street, Hamilton, Bermuda (the "BANK").

NOW THIS DEBENTURE WITNESSES and IT IS AGREED as follows:

1        COVENANT TO PAY

1.1      The Borrower covenants to pay and discharge to the Bank on demand all
         moneys obligations and liabilities whether principal interest or
         otherwise which may now or at any time in the future be due owing or
         incurred by the Borrower to the Bank whether 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 together with interest charges and
         other expenses so that interest shall be calculated and compounded as
         may be agreed from time to time between the parties or, if not agreed,
         in accordance with the usual practice of the Bank from time to time as
         well after as before any demand made or judgment obtained hereunder.

2        CHARGE

2.1      The Borrower as beneficial owner hereby charges with the payment or
         discharge of all moneys obligations and liabilities hereby covenanted
         to be paid or discharged by the Borrower including an initial facility
         in the sum of One Million Two Hundred and Fifty Thousand United States
         Dollars (US$1,250,000) together with all costs and expenses incurred by
         the Bank in relation to this Debenture or the moneys obligations and
         liabilities hereby secured:

         (a)      by way of first fixed charge:

                  (i)      all mechanical, electrical and other equipment and
                           all civil engineering works or plant including
                           appurtenances thereto now or in the future belonging
                           to the Borrower and used or to be used in the supply
                           construction operation and otherwise in connection
                           with any reverse osmosis desalination plant and all
                           parts chemicals and supplies which may from time to
                           time be used in connection with the plant;

                                        1

<PAGE>

                  (ii)     all other plant and machinery computers office and
                           other equipment now or in the future belonging to the
                           Borrower and the full benefit of any warranties or
                           maintenance contracts for any of the same;

                  (iii)    all cash at bank, book debts and other debts
                           including rents now or in the future due or owing to
                           the Borrower;

                  (iv)     all stocks shares bonds and other securities now or
                           in the future belonging to the Borrower together with
                           all dividends and other rights deriving therefrom;

                  (v)      the goodwill of the Borrower and its uncalled capital
                           for the time being;

                  (vi)     the benefit of any licences and all patent
                           applications inventions trade marks service marks
                           designs and trade names copyright knowhow and other
                           intellectual property rights and all fees, royalties
                           and other rights of every kind deriving therefrom now
                           or in the future belonging to the Borrower;

                  (vii)    all other fixed assets of the Borrower to include all
                           undertaking and all other property assets and rights
                           whatsoever and wheresoever present and future not
                           hereby effectively charged by way of first fixed
                           charge;

         (b)      by way of first floating charge the whole of the Borrower's
                  undertaking and all its property and assets whatsoever and
                  wheresoever present and future other than the property and
                  assets from time to time effectively charged to the Bank by
                  way of legal mortgage or fixed charge by this Debenture.

         Nothing herein shall be construed as creating a charge over any land or
         interest therein, unless the Bank shall have first obtained a requisite
         non-belonger land holding licence under the provisions of the
         Non-Belongers Land Holding Regulation Act (Cap. 122) to hold such
         charge.

2.2      The Bank may convert the floating charge at any time by notice in
         writing to the Borrower into a fixed charge as regards all the property
         and assets which for the time being are the subject of such floating
         charge or, as the case may be, such of the said property and assets as
         are specified by such notice. The floating charge created by this
         Debenture shall unless otherwise agreed in writing by the Bank
         automatically and without notice immediately be converted into a fixed
         charge in the event that the Borrower shall create or permit to subsist
         any mortgage charge pledge lien or other security interest other than
         this Debenture or if any person takes any step to levy any distress
         attachment execution or other legal process against any of the said
         property or assets.

2.3      The security from time to time constituted by or pursuant to this
         Debenture shall be in

                                        2

<PAGE>

         addition to and shall not prejudice determine or affect any other
         security which the Bank may from time to time hold for or in respect of
         all or any part of the moneys obligations and liabilities hereby
         secured. No prior security held by the Bank over the property charged
         by this Debenture or any part of it shall merge in the security created
         hereby or pursuant hereto which will remain in force and effect as a
         continuing security until discharged by the Bank.

3        RESTRICTIONS ON DEALING

3.1      The Borrower shall not without the prior written consent of the Bank:

         (a)      create or permit to subsist any mortgage debenture charge
                  pledge lien (other than a lien arising by operation of law in
                  the ordinary course of trading) or other encumbrance or
                  security interest on any of its assets other than this
                  Debenture;

         (b)      sell transfer lease lend or otherwise dispose of the whole or
                  any part of its undertaking or (save in the normal course of
                  trading at not less than market value) of its assets or enter
                  into any agreement or grant any option for any such sale
                  transfer lease loan or other disposal;

         (c)      part with possession of any freehold or leasehold property
                  grant or agree to grant any option or any licence tenancy or
                  other right of occupation to any person or exercise the powers
                  of leasing or agreeing to lease or of accepting or agreeing to
                  accept surrenders provided that such restrictions shall not be
                  construed as a limitation on the powers of any receiver
                  appointed under this Debenture and being an agent of the
                  Borrower;

         (d)      pull down or remove or redevelop or make any material
                  alteration to the whole or any part of any buildings or sever
                  unfix or remove any fixtures or remove any plant or machinery
                  belonging to or in use by the Borrower except for the purpose
                  of effecting repairs or replacing the same;

         (e)      redeem or purchase its own shares, or pay dividend and profit
                  shares unless there is a minimum cash flow of US$500,000 after
                  debit service is retained to support the operating costs of
                  the reverse osmosis plant of the Borrower, and

         (f)      amend or waive any of its rights under the agreement to
                  produce portable water from sea water between the Borrower and
                  the Government of the British Virgin Islands as amended by a
                  supplemental agreement dated 14 March 1991 and a further
                  supplemental agreement dated 24 January 1992 (hereinafter the
                  "CONTRACT").

4        REPRESENTATIONS WARRANTIES AND COVENANTS BY THE BORROWER

4.1      The Borrower represents and warrants to the Bank as at the date of this
         Debenture and so long as any sums secured by this Debenture remain
         outstanding and undertakes that:

                                        3

<PAGE>

         (a)      it is duly incorporated validly existing and in good standing
                  under the laws of the British Virgin Islands;

         (b)      it has and will at all times have the necessary power to enter
                  into and perform its obligations under this Debenture;

         (c)      this Debenture constitutes its legal valid binding and
                  enforceable obligations and is a first priority security over
                  the assets charged hereunder and every part thereof effective
                  in accordance with its terms;

         (d)      all necessary authorisations and consents to enable or entitle
                  it to enter into this Debenture have been obtained and will
                  remain in full force and effect during the subsistence of the
                  security constituted by this Debenture;

         (e)      the entry into and performance by it of, and the
                  transactions contemplated by, this Debenture do not and will
                  not:

                  (a)      conflict with any law or regulation or judicial or
                           official order;

                  (b)      conflict with the constitutional documents of the
                           Borrower; or

                  (c)      conflict with any document which is binding upon the
                           Borrower or any of its assets;

         (f)      all approval from any government, tax monetary or other
                  authorities have been obtained and are in full force and
                  effect;

         (g)      the execution of this Debenture and the borrowings and
                  repayment of the loan will not contravene any agreement to
                  which the Borrower is a party;

         (h)      it is not in default under any agreement to which it is a
                  party nor is it the subject of any actual, pending or
                  threatened legal proceedings either of which has or may have a
                  material adverse effect on the Borrower's financial condition;

         (i)      the financial statements and all other financial and other
                  information delivered to the Bank are true and accurate, do
                  not omit any material facts or other information which might
                  make them misleading and no material change has occurred since
                  the date of those valuations or the dates when such other
                  financial and other information was delivered to the Bank;

         (j)      the Startup Date (as defined in the Contract) of the Contract
                  is 31 May 1992 and the termination date is 31 May 2006,
                  there have been no amendments to the Contract since the
                  Supplemental Agreement # 2 dated 24 January 1992, and there
                  have been no defaults under the Contract;

                                        4

<PAGE>

         (k)      other than this Debenture, it has not assigned or agreed to
                  assign, charge or in any way encumber any of its present or
                  future rights, title and interest in and to the Contract or
                  any of its other assets (other than a lien arising by
                  operation of law in the ordinary course of trading);

         (l)      no right of action is vested in any party under the Contract
                  in respect of any representation, breach of condition, breach
                  of warranty or breach of any other express or implied term by
                  the Borrower thereunder; and

         (m)      it has no knowledge of any fact that would or might prejudice
                  or affect any right, power or ability of the Bank to enforce
                  this Debenture or condition thereof.

4.2      The Borrower shall:

         (a)      conduct and carry on its business in a proper and efficient
                  manner and not make any substantial alteration in the nature
                  of or mode of conduct of that business and keep or cause to be
                  kept proper books of account and records relating to such
                  business;

         (b)      perform its obligations in a prompt and efficient manner and
                  maintain and enforce its rights under the Contract and not do
                  or omit to do anything in relation thereto which may
                  reasonably be expected adversely and materially to affect the
                  ability of the Borrower to perform its obligations under the
                  Contract this Debenture or any agreement with the Bank;

         (c)      keep all buildings and all plant machinery fixtures and
                  fittings in good repair and condition and permit any person or
                  persons nominated by the Bank free access at all times to view
                  the state and condition thereof;

         (d)      insure and keep insured such of its property as is insurable
                  with such insurer and against such risks and in such amounts
                  and otherwise in such terms as the Bank may require and will
                  maintain such other insurances as are normally maintained by
                  prudent companies carrying on similar businesses with the
                  interest of the Bank noted upon all policies of such insurance
                  or, if the Bank shall require, in the joint names of the
                  Borrower and the Bank and will produce or deposit with the
                  Bank all such policies and receipts for all premium and other
                  payments necessary for effecting and maintaining such
                  insurances;

         (e)      apply any insurance proceeds in making good the loss or damage
                  or at the Bank's option in or towards the discharge of the
                  moneys obligations and liabilities secured by this Debenture;

         (f)      punctually pay all rents taxes duties assessments and other
                  outgoings and observe and perform all restrictive and other
                  covenants under which any of the property subject to this
                  Debenture is held;

                                        5

<PAGE>

         (g)      pay into its account with the Bank all moneys which it may
                  receive in respect of its book or other debts and all licence
                  fees, royalties and other moneys deriving from its
                  intellectual property and until such payment hold all such
                  moneys on trust for the Bank;

         (h)      deal with its book or other debts and all licence fees,
                  royalties and other moneys deriving from its intellectual
                  property in accordance with any directions from time to time
                  given in writing by the Bank and in default of and subject to
                  any such directions not release factor sell at discount charge
                  assign or otherwise deal with such debts, licence fees,
                  royalties or other moneys otherwise than by getting in and
                  paying the same into such account;

         (i)      deposit with the Bank all deeds certificates and documents
                  constituting or evidencing title to the property or any part
                  thereof charged by this Debenture and all insurance policies;

         (j)      comply with the provisions of all present or future statutes
                  and directives and every notice order or directions made under
                  any of the foregoing;

         (k)      not do or cause or permit to be done anything which may in any
                  way depreciate, jeopardise or otherwise prejudice the value to
                  the Bank of the security hereby charged;

         (l)      provide the Bank with all financial and other information with
                  respect to the assets, liabilities and affairs of the Borrower
                  and its subsidiaries and associated companies (if any) that
                  the Bank may form time to time require.

         (m)      if required by the Bank, procure that each subsidiary of the
                  Borrower shall guarantee to the Bank payment of all moneys,
                  obligations and liabilities hereby covenanted to be paid and
                  charge all its undertaking, property and assets to secure the
                  same in such manner as the Bank shall from time to time
                  require;

         (n)      if required by the Bank, will cause each of its subsidiaries
                  to, permit the Bank or any agent or representative of the
                  Bank, examine and make copies of and abstracts from the
                  records and books of account of the Borrower and visit the
                  premises and properties of the Borrower and to discuss the
                  affairs, finances and accounts of the Borrower and its
                  subsidiaries with any of the officers or knowledgeable
                  employees of the Borrower or such subsidiaries.

4.3      The Borrower hereby further covenants with the Bank that during the
         continuance of the security constituted by this Debenture the Borrower
         will:

         (a)      furnish to the Bank copies of the profit and loss account,
                  balance sheet and directors' report in respect of each
                  financial year of the Borrower, its holding companies and such
                  of the subsidiaries of the Borrower or its holding companies
                  as the Bank may from time to time require showing a true and
                  fair view of their

                                        6

<PAGE>

                  respective affairs, profit or loss and source and application
                  of funds certified by duly qualified auditors approved by the
                  Bank forthwith upon the same becoming available and not in any
                  event later than the expiration of ninety (90) days from the
                  end of such financial year and also at the time of issue
                  copies of all, annual reports and other information of a
                  financial or business nature circulated to shareholders or to
                  any class of creditors and from time to time such other
                  information, statements, forecasts and projections of the
                  Borrower, its holding companies and the subsidiaries of the
                  Borrower as the Bank may require;

         (b)      at the request of the Bank furnish copies of annual financial
                  statements of its shareholders, and promptly inform the Bank
                  of its financial position generally which would be material to
                  be known to a director or a lender;

         (c)      furnish the Bank with copies of all notices given to or
                  received from any person in relation to the Contract promptly
                  after the same are given or as the case may be received;

         (d)      notify the Bank immediately of any default or event likely to
                  cause a default of the Borrower or the Government of the
                  British Virgin Islands under the terms of the Contract, and of
                  any action taken by any party or any act or event which could
                  terminate or invalidate the Contract;

         (e)      maintain in full force and effect all government tax monetary
                  and other approval consents and licences required to enable
                  the Borrower to maintain its corporate status to continue to
                  carry on its business and affairs.

4.4      If the Borrower shall fail to satisfy the Bank that it has performed
         any of its obligations under clauses 4.2 and 4.3, then the Bank may
         take such steps as it considers appropriate procure the performance of
         such obligation and shall not thereby be deemed to be a mortgagee in
         possession and the moneys expended by the Bank shall be reimbursed by
         the Borrower on demand and until so reimbursed shall carry interest as
         mentioned in clause 1 from the date of payment to the date of
         reimbursement.

5        ENFORCEMENT

5.1      This Debenture shall become enforceable:

         (a)      upon demand by the Bank;

         (b)      if any of the moneys obligations and liabilities secured by
                  this Debenture shall not be paid or discharged by the Borrower
                  in accordance with clause 1 immediately upon it coming due; or

         (c)      if the Borrower shall be in breach of any provision of this
                  Debenture or of any agreement containing any terms and
                  conditions of or applicable to the moneys obligations and
                  liabilities secured by this Debenture; or

                                        7

<PAGE>

         (d)      upon the presentation of a petition for the winding up of the
                  Borrower or an order made or the passing by the Borrower of a
                  resolution for voluntary winding up; or

         (e)      if an encumbrancer shall take possession of or a receiver
                  shall be appointed over or any secured creditor of the
                  Borrower shall seek to enforce his security in respect of all
                  or any of the property or assets charged by this Debenture; or

         (f)      if the Borrower shall enter into any composition or
                  arrangement for the benefit of its creditors; or

         (g)      if any information, representation, warranty or undertaking
                  from time to time provided or made to the Bank by the Borrower
                  is or becomes incorrect or misleading in a material respect;
                  or

         (h)      if the Borrower defaults under the Contract, or any trust
                  deed, loan agreement, debenture or other agreement or
                  obligation relating to borrowing (which expression includes
                  all liabilities in respect of accepting, endorsing or
                  discounting any notes or bills, all unpaid rental and other
                  liabilities, present and future, under hire-purchase, credit
                  sale, conditional sale, leasing and similar agreements the
                  purchase price or charge for all acquisitions or services
                  payment of which is deferred for three months or more and all
                  liabilities under debt purchase, factoring and like agreements
                  contingent on non-payment of any debt) 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) 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 paid when due or if
                  any debenture, mortgage, charge or other security from time to
                  time created by the Borrower becomes enforceable; or

         (i)      if any judgment or order made against the Borrower is not
                  complied with within seven days from the date of entry thereof
                  or if an execution, distress, sequestration or other process
                  is levied or enforced upon or sued out against any part of the
                  undertaking, property, assets or revenues of the Borrower; or

         (j)      if the Borrower stops payment or agrees to declare a
                  moratorium or becomes or is deemed to be insolvent or unable
                  to pay its debts within the meaning of the Companies Act
                  (British Virgin Islands) or when they fall due or if a notice
                  is issued convening a meeting of or the Borrower proposes to
                  enter into any composition or arrangement with its creditors
                  or any class of its creditors; or

         (k)      if any material part of the assets or revenues of the Borrower
                  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 or
                  if any partnership

                                        8

<PAGE>

                  of which the Borrower is or becomes a partner is dissolved; or

         (l)      if any part of the security hereby created or any guarantee,
                  indemnity or other security for any money obligation or
                  liability hereby secured fails or ceases in any respect to
                  have full force and effect or to be continuing or is
                  terminated or disputed or becomes in jeopardy, invalid or
                  unenforceable; or

         (m)      if any licence, authorisation, consent or registration at any
                  time necessary or desirable to enable the Borrower to comply
                  with its obligations to the Bank or to carry on its 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; or

         (n)      if control of the Borrower is acquired by any person or group
                  of connected persons not having control of the Borrower at the
                  date hereof (unless with the prior consent in writing of the
                  Bank); or

         (o)      if it becomes illegal under any law applying to the Bank for
                  it to make or maintain any credit facility secured by this
                  Debenture; or

         (p)      if:

                  (i)      any of the foregoing events occurs without the prior
                           consent in writing of the Bank in relation to: (A)
                           any third party which now or hereafter has guaranteed
                           or provided security for or given an indemnity in
                           respect of any obligation and liabilities hereby
                           secured; or (B) any subsidiary or holding company of
                           the Borrower of any such third party or any
                           subsidiary of any such holding company; or

                  (ii)     any individual now or hereafter liable as such third
                           party shall commit an act of bankruptcy, die or
                           become of unsound mind;

         (q)      the Borrower shall have failed to repay, forthwith, any
                  obligation or liability which has become illegal for the Bank
                  to continue to hold, fund or maintain due to a change in, or
                  in the interpretation of, any law or regulation or compliance
                  with any guidelines or request from any governmental authority
                  (whether or not having the force of law); or

         (r)      if the Borrower shall cease or threaten to cease to carry on
                  its business, or any other event shall take place which in the
                  opinion of the Bank puts in jeopardy all or any part of the
                  security created by this Debenture.

5.2      The Borrower hereby covenants to immediately notify the Bank in writing
         of the occurrence of any enforceable event specified in clause 5.1 or
         of the occurrence of any event or circumstance which with the lapse of
         time will or may constitute an enforceable event.

                                        9

<PAGE>

6.       RECEIVER

6.1      At any time after this Debenture has become enforceable or if the
         Borrower so requests in writing the Bank may without further notice to
         the Borrower appoint by writing under hand or under seal any one or
         more persons (whether an officer of the Bank or not) either singly
         jointly severally or jointly and severally to be a receiver, receiver
         and manager or administrative receiver (each a "Receiver") of all or
         any part of the property charged by this Debenture and either at the
         time or appointment or any time thereafter may fix his or their
         remuneration and except as otherwise required by statute may remove
         any such Receiver and appoint another or others in his or their place.

6.2      Any Receiver shall be the agent of the Borrower which shall be solely
         responsible for his acts and defaults and the payment of his
         remuneration,

6.3      Any Receiver shall:

         (a)      take possession of collect and get in all or any part of the
                  property in respect of which he is appointed and for that
                  purpose to take any proceedings in the name of the Borrower or
                  otherwise as may seem expedient;

         (b)      carry on or concur in carrying on the business of the Borrower
                  and to raise money from the Bank or others on the security of
                  any property charged by this Debenture;

         (c)      purchase or acquire any land and purchase, acquire and grant
                  any interest in or right over land;

         (d)      sell or concur in selling let or concur in letting and
                  terminate or accept surrenders of leases or tenancies or any
                  of the property charged by this Debenture and to carry any
                  such transactions into effect;

         (e)      sell, assign let or otherwise dispose of or concur in selling,
                  assigning, letting or otherwise disposing of all or any of the
                  debts and any other property in respect of which he is
                  appointed;

         (f)      make any arrangement or compromise between the Borrower and
                  any other person which he may think expedient;

         (g)      make and effect all repairs improvement and insurances;

         (h)      purchase materials tools equipment goods or supplies;

         (i)      call up any uncalled capital of the Borrower with all the
                  powers conferred by the Memorandum and Articles of Association
                  of the Borrower in relation to calls;

                                       10

<PAGE>

         (j)      employ engage and appoint managers and other employees and
                  professional advisers;

         (k)      do all such other acts and things as may be considered to be
                  incidental or conducive to any other matters or powers
                  aforesaid or to the realisation of the security constituted by
                  this Debenture and which he lawfully may or can do.

7        APPLICATION OF PROCEEDS

7.1      Any moneys received by the Bank or any Receiver shall subject to the
         repayment of any claims having priority to the charges created by this
         Debenture be applied in the following order but without prejudice to
         the right of the Bank to recover any shortfall from the Borrower:

         (a)      in the payment of all costs charges and expenses of and
                  incidental to the appointment of the Receiver and the exercise
                  of all or any of his powers and of all outgoings paid by him;

         (b)      in the payment of the Receiver's remuneration;

         (c)      in or towards the satisfaction of the moneys obligations and
                  liabilities secured by Debenture in such order as the Bank in
                  its absolute discretion thinks fit;

         (d)      in payment of the surplus (if any) to the person or persons
                  entitled to it.

7.2      All moneys received recovered or realised by the Bank under this
         Debenture 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 shall think fit pending its application from to time in or
         towards the discharge of any of the moneys obligations and liabilities
         secured by this Debenture.

8        PROTECTION OF THIRD PARTIES

8.1      No person dealing with a Receiver or the Bank shall be concerned to
         enquire whether any power which he or it is purporting to exercise has
         become exercisable or whether any money is due under this Debenture or
         as to the application of any money paid raised or borrowed or as to the
         propriety or regularity of any sale by or other dealing with such
         Receiver or the Bank. All the protection to purchasers contained in any
         statute shall apply to any person purchasing from or dealing with a
         Receiver or the Bank.

9        ENTRY INTO POSSESSION

9.1      If the Bank or any Receiver shall enter into possession of the property
         hereby charged or any part thereof it or he may from time to time and
         at any time go out of such possession. Neither the Bank nor any
         Receiver shall in any circumstances (either by reason of any entry into
         or taking of possession of any such property or for any other reason
         and

                                       11

<PAGE>

         whether as mortgagee in possession or on any other basis) be liable to
         account to the Borrower for anything except its or his actual receipts
         or be liable to the Borrower for any loss or damage arising from any
         realisation of the property hereby charged or from any act default or
         omission in relation thereto.

10       POWER OF ATTORNEY

10.1     the Borrower irrevocably appoints the Bank any Receiver and any person
         nominated by the Bank jointly and also severally to be the attorney of
         the Borrower with the power of substitution and in its name and
         otherwise on its behalf and as its act and deed to sign or execute all
         deeds instruments and documents which the Bank or any Receiver may
         require or deem proper for any of the purposes of or which the Borrower
         ought to do under this Debenture. The Borrower agrees to ratify and
         confirm anything such attorney shall lawfully and properly do.

11       CURRENCY INDEMNITY

11.1     For the purpose of or pending the discharge of any of the moneys
         obligations and liabilities secured by this Debenture the Bank may
         convert any moneys received recovered or realised by the Bank under
         this Debenture (including the proceeds of any previous conversion) from
         their existing currency into such other currency as the Bank may think
         fit and any such conversion shall be effected at the Bank's then
         prevailing spot selling rate of exchange for such other currency
         against the existing currency. As a separate and independent obligation
         the Borrower agrees to indemnify and hold harmless the Bank against any
         shortfall between any amount received or recovered by it in respect of
         any payment due under this Debenture and converted in accordance with
         the clause into the currency in which such amount was payable and the
         amount in such currency which was due and payable to the Bank under
         this Debenture.

12       NEW ACCOUNTS

12.1     If the Bank shall at any time receive actual or constructive notice of
         any charge or other interest affecting any part of the property hereby
         charged then the Bank may open a new account or accounts for the
         Borrower and if the Bank does not do so then the Bank shall be treated
         as if it had in fact done so at the time when it received or was deemed
         to receive notice and as from that time all payments made by the
         Borrower to the Bank shall be credited or treated as having been
         credited to the new account and shall not operate to reduce the amount
         secured by this Debenture at the time when the Bank received or was
         deemed to received such notice.

13       PRIOR CHARGES

13.1     If there is any encumbrance over any of the property charged by this
         Debenture which ranks in priority to this Debenture and any
         proceedings or steps are taken to exercise or enforce any powers or
         remedies conferred by such prior encumbrance the Bank or any Receiver
         appointed under this Debenture in respect or such property may (but
         without

                                       12

<PAGE>

         prejudice to any rights the Receiver) redeem such prior encumbrance or
         procure its transfer to itself and may settle and pass the accounts of
         any prior mortgagee, chargee or encumbrancer. Any account so settled
         and passed shall be conclusive and binding on the Borrower and all the
         principal interest costs charges and expenses of and incidental to such
         redemption or transfer shall be secured on the property charged by this
         Debenture and all the powers conferred by any prior encumbrance upon
         the encumbrancer or any receiver thereunder shall be exercisable by the
         Bank or a Receiver in like manner as if the same were expressly
         included in this Debenture.

14       FURTHER ASSURANCE

14.1     The Borrower shall at its own cost whenever requested by the Bank
         immediately execute and sign all such deeds and documents and do all
         such things as the Bank may require for the purpose of perfecting or
         more effectively providing security to the Bank for the payment and
         discharge of the moneys obligations and liabilities secured by this
         Debenture or to facilitate the realisation of the property and assets
         mortgaged and charged by this Debenture or the exercise of any rights
         vested in the Bank or any Receiver.

15       SET-OFF

15.1     The Bank may at any time and without notice to the Borrower combine or
         consolidate all or any of the Borrower's then existing accounts with
         and liabilities to the Bank and set off or transfer any sum or sums
         standing to the credit of any one or more of such accounts in or
         towards satisfaction of any of the liabilities of the Borrower to the
         Bank on any other account or in any other respects. The Bank shall
         notify the Borrower that such a transfer has been made.

16       COSTS AND INDEMNITY

16.1     All reasonable costs, expenses and disbursements incurred by the Bank
         in relation to this Debenture or the moneys obligations and liabilities
         hereby secured including for the avoidance of doubt all amounts the
         Bank may incur in the negotiation, preparation and completion, and in
         the maintenance, protection and enforcement of any of its rights, and
         may from time to time require to compensate it for its internal
         management and administrative costs and expenses, stamp duty and legal
         fees (attorney-and-own-client basis), and any amount which the Bank may
         certify to be necessary to compensate the Bank for any increased costs
         or reduction in return resulting from compliance with any change in, or
         in the interpretation of any law or regulation of any official
         directive or request (whether or not having the force of law), shall be
         reimbursed by the Borrower to the Bank on demand on a full indemnity
         basis and until so reimbursed shall carry interest in accordance with
         the provisions set out in clause 1 from the date of payment to the date
         of reimbursement and be secured on the property charged by this
         Debenture. A certificate signed by the Bank as to the amount of such
         costs and expenses shall be conclusive and binding upon the Borrower.

                                       13

<PAGE>

16.2     The Bank and every Receiver attorney or other person appointed by the
         Bank under this Debenture and their respective employees shall be
         entitled to be indemnified on a full indemnity basis out of the
         property charged by this Debenture in respect of all liabilities and
         expenses incurred by any of them in or directly or indirectly as a
         result of the exercise or purported exercise of any of the powers
         authorities or discretions vested in them under this Debenture and
         against all actions proceedings losses costs claims and demands in
         respect of any matter or thing done or omitted in any way relating to
         the property charged by this Debenture and the Bank and any such
         Receiver may retain and pay all sums in respect of the same out of the
         moneys received under the powers conferred by this Debenture.

17       MISCELLANEOUS

17.1     The Bank may without discharging or in any way affecting the security
         created by this Debenture or any remedy of the Bank grant time or other
         indulgence or abstain from exercising or enforcing any remedies
         securities guarantees or other rights which it may now or in the future
         have from or against the Borrower and may make any arrangement
         variation or release with any person or persons without prejudice
         either to this Debenture or the liability of the Borrower for the
         moneys obligations and liabilities secured by this Debenture.

17.2     The Borrower shall not assign or transfer any rights or obligation
         under this Debenture. The Bank shall have a full and unfettered right,
         on giving written notice to the Borrower, to assign the whole or any
         part of the benefit and/or obligations of this Debenture and the
         expression "the Bank" shall include its successors and assigns and the
         Bank shall be entitled to disclose any information to any actual or
         prospective assignee successor or participant.

17.3     The provisions of this Debenture shall be severable and if at any time
         any one or more such provisions is or becomes invalid illegal or
         unenforceable the validity legality and enforceability of the remaining
         provisions shall not in any way be impaired.

17.4     The rights and remedies of the Bank provided by this Debenture are
         cumulative and are not exclusive of any rights powers or remedies
         provided by law and may be exercised from time to time and as often as
         the Bank may deem expedient.

17.5     Any reference in this Debenture to any statute or any section of any
         statute shall be deemed to include reference to any statutory
         modification or re-enactment thereof for the time being in force.

18       NOTICES

18.1     Any demand or notice under this Debenture shall be in writing and may
         be served personally on any director or the secretary of the Borrower
         or may be sent by post telex or facsimile or may be delivered to the
         registered office of the Borrower or its last known place of business.
         If such demand or notice is sent by post it shall be deemed to have

                                       14

<PAGE>

         been received seven days after it was posted and shall be effective
         notwithstanding that it was not in fact delivered or was returned
         undelivered. If sent by telex or facsimile it shall be deemed to have
         been received (whether or not actually received) at the time of
         dispatch.

19       GOVERNING LAW AND JURISDICTION

19.1     This Debenture shall be governed by and construed in accordance with
         the laws of the British Virgin Islands and the Borrower irrevocably
         submits to the non-exclusive jurisdiction of the courts of the British
         Virgin Islands and the courts of Bermuda.

IN WITNESS WHEREOF this Debenture has been executed as a deed the day and year
first above written.

THE COMMON SEAL of Ocean                  )    /s/ [ILLEGIBLE]
Conversion (BVI) Ltd was hereunto affixed )    ---------------------------
and attested to by Glenn Harrigan and                Director
Romney Penn, directors                    )    /s/ [ILLEGIBLE]
in the presence of:                       )    ---------------------------
                                          )    Director
/s/ [ILLEGIBLE]
-------------------------
Witness

THE COMMON SEAL of The Bank of            )    /s/ [ILLEGIBLE]
N.T. Butterfield and Son Limited was      )    ---------------------------
hereunto affixed and attested to by       )    Authorised Signatory

______________________________
in the presence of:

/s/ [ILLEGIBLE]
--------------------------------
Witness

                                                                          [SEAL]

                                       15

<PAGE>

                                    AFFIDAVIT

         I Carlene Herbert of McNamara, Tortola, British Virgin Islands, make
OATH and SAY as follows:-

1.       I was present at Road Town, Tortola, British Virgin Islands on the 15th
day of July, 2002 and did then and there see Glenn Harrigan and Romney Penn as
Directors of OCEAN CONVERSION (BVI) LTD duly sign the foregoing Debenture and
affix the Company's Seal thereto.

2.       The signatures "Glenn Harrigan" and "Romney Penn" duly set and
subscribed to the said Debenture at the foot or end thereof opposite the Seal of
the party of the One Part executing the same are of the proper handwritings of
Glenn Harrigan and Romney Penn aforesaid and the signature "Carlene Herbert"
thereto also set and subscribed as that of the witness attesting the due
execution thereof by Glenn Harrigan and Romney Penn on behalf of OCEAN
CONVERSION (BVI) LTD aforesaid is of the proper handwriting of me this
deponent.

SWORN at Road Town, Tortola     )

British Virgin Islands          )       /s/ [ILLEGIBLE]
                                        -----------------------------
this 15th day of July, 2002     )

                                )

         BEFORE ME:

/s/ [ILLEGIBLE]
-----------------------------
NOTARY PUBLIC

[SEAL]       [SEAL]

                                       16

<PAGE>

                                    AFFIDAVIT

         I BETH TAYLOR VESEY of 2 Cherry Dale, Smith's, Bermuda, make
OATH and SAY as follows:-

1.       I was present at the offices of the Bank of N.T. Butterfield & Son Ltd.
on the 22nd day of august, 2002 and did then and there see Michael A. McWatt &
Philip C. Jones an authorised signatory of THE BANK OF N.T. BUTTERFIELD & SON
LIMITED duly sign the foregoing Debenture and affix the Company's Seal thereto.

2.       The signature "[ILLEGIBLE]" duly set and subscribed to the said
Debenture at the foot or end thereof opposite the Seal of the party of the One
Part executing the same is of the proper handwriting of Michael McWatt & Philip
Jones aforesaid and the signature "[ILLEGIBLE]" thereto also set and subscribed
as that of the witness attesting the due execution thereof by [ILLEGIBLE]
Michael McWatt, Philip C. Jones on behalf of THE BANK OF N.T. BUTTERFIELD & SON
LIMITED aforesaid is of the proper handwriting of me this deponent.

SWORN at City of Hamilton,    )

Island of Bermuda             )

                                      /s/ [ILLEGIBLE]
this 22nd day of August, 2002 )       -----------------------------

                              )

         BEFORE ME:

/s/ [ILLEGIBLE]
--------------------------
NOTARY PUBLIC

Seal

         JOHN BARRITT
         NOTARY PUBLIC
         "CEDAR HOUSE"
        41 CEDAR AVENUE
        HAMILTON, BERMUDA                                                 [SEAL]

                                       17

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