Document:

Ex-10.11 Cayman Islands Collateral Charge

 

EXHIBIT
10.11

 

			
	FORM RL9
	 	INSTRUMENT NO.
	 
	 	 

CAYMAN ISLANDS

The Registered Land Law (2004 Revision)

THIRD SCHEDULE

COLLATERAL CHARGE

(Collateral to A Debenture)

	 	 	 	 	 	 	 
	REGISTRATION SECTION

	 	BLOCK
	 	PARCEL

	WEST
BAY BEACH NORTH

	 	11D
	 	 	8	 

I/WE, CAYMAN WATER COMPANY LIMITED

HEREBY CHARGE my/our interest in the above mentioned title to secure the payment

to     DEXTRA BANK & TRUST CO. LTD.

of     198 North Church Street, George Town, Grand Cayman, Cayman Islands

of the principal sum of FIFTEEN MILLION SEVEN HUNDRED SEVENTY-ONE THOUSAND NINE HUNDRED
NINETY-SEVEN UNITED STATES DOLLARS (US$15,771,997.00)

with interest at the rate as set out in Schedules A and B attached hereto, payable in accordance
with the
terms of Schedule A and B attached, subject to section 67 of the above law, unless hereby
negatived,
modified or added to. (Here set forth any variation, or make reference to an attached document).

     1)   Requests to Registrar

     2)   Schedule A

     3)   Schedule B

     The principal sum shall be repaid on demand and otherwise in accordance with Schedules A and B
attached hereto together with any interest then due.

     And I/WE the above named Chargor(s) hereby acknowledge that we understand the effect of
section 72 of the Registered Land Law, (2004 Revision).

Dated
this 4th day of August 2006

CAYMAN WATER COMPANY LIMITED

	 	 	 
	Signed by the Chargor
	 	Frederick
W.
McTaggart                  Greg
McTaggart

director                                          director/secretary

	 
	 	 

	in the presence of:- 
	 	Donald
Miller

                DEXTRA BANK & TRUST CO. LTD.

	Signed by the Chargee
	 	Alex
Wood                                     Alitsia
Finlayson

director                                          director/secretary

	 
	 	 

	in the presence of:-
	 	Donald
Miller

 

FOR OFFICIAL USE ONLY

I, the Registrar of Lands in the Cayman Islands hereby certify that this document was
received by me for registration on the
.......................................... day of
...............200......
and that stamp duty assessed/adjudicated by me/Treasury at
C.I.$..........and
Land Registry fees at C.I.$......................................... relating thereto have been paid.

REGISTERED this                      day of                      200

.........................................

REGISTRAR OF LANDS, CAYMAN ISLANDS

 

 

CERTIFICATE
OF IDENTIFICATION

CAYMAN WATER COMPANY LIMITED

By:

By:

Name................................................................................. .

I HEREBY CERTIFY that the above named person..................................................................................

appeared before me on the ........ day of July 2006 and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

CERTIFICATE OF IDENTIFICATION

DEXTRA BANK & TRUST CO. LTD.

By:

By:

Name................................................................................. .

I HEREBY CERTIFY that the above named ..................................................................................

appeared before me on the ........ day of July 2006 and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

CERTIFICATE OF IDENTIFICATION

Name................................................................................. .

I HEREBY CERTIFY that the above named ..................................................................................

appeared before me on the ........ day of ........................
200 ........ and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

			
	*NOTE:	 	Please ensure that the appropriate insertions and/or deletions are made

so that the method of identification is clear.

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THE REGISTRAR OF LANDS IS HEREBY REQUESTED

	a)	 	to register this Charge in favour of the Chargee;
	 
	b)	 	to note on the register that the attached schedule contains an agreement by the Chargor with
the Chargee that the Chargor will not without first obtaining the prior written consent of the
Chargee, sell, lease or sub-lease or agree to lease or sub-lease, charge, let or assign or
transfer or otherwise part with the possession of the charged premises or any part thereof;
	 
	(c)	 	to note on the register that the right to tack and rank in priority to any subsequent charge
is expressly reserved to the Chargee;
	 
	(d)	 	to note on the register that the attached Schedule reserved to the Chargee the right to
consolidate this Charge with any other charge;
	 
	(e)	 	to note on the register that the attached Schedule contains an agreement by the Chargor with
the Chargee that the Chargor will not without first obtaining the prior written consent of the
Chargee create or purport or attempt to create any charge, incumbrance or mortgage which by
virtue of any law or regulation will rank pari passu with or in priority to this Charge or
second or subsidiary to this Charge.

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SCHEDULE “A”

NOW THIS INSTRUMENT WITNESSETH as follows:-

	1.	 	INTERPRETATION
	 
	 	 	Throughout this instrument unless the context otherwise requires the following expressions

have the following meanings:-

	 	a.	 	“The Chargor”, “the Guarantor” (if any) and “the Chargee” includes besides the
parties hereto their respective personal representatives, successors in title and
transferees.
	 
	 	b.	 	“The Principal” means the principal sum hereby advanced and secured and set out
in Item Two (2) of the Schedule “B” hereto.
	 
	 	c.	 	“The Statute” means the Registered Land Law or any re-enactment thereof or any
enactment amending the same.
	 
	 	d.	 	“The Board of Directors” means the Directors of DEXTRA BANK & TRUST CO.
LTD. from time to time.
	 
	 	e.	 	“The Charged Premises” means the land the subject of this Charge as set out in
Item Five (5) of the Schedule “B” hereto.
	 
	 	f.	 	“The Building” or “Buildings” means any building or erection erected on the
Charged Premises whether or not permanently attached thereto and includes all fixtures
and fittings and any chattels owned by the Chargor and used in or about the Charged
Premises.

	2.	 	COVENANTS BY THE CHARGOR
	 
	 	 	In consideration of the Principal lent and advanced by the Chargee to the Chargor at the
request of the Chargor (the receipt whereof is hereby acknowledged), the Chargor HEREBY
COVENANTS with the Chargee during the continuance of this security as follows:-

	 	A.	 	TO PAY PRINCIPAL
	 
	 	 	 	To pay to the Chargee on the date specified in Item One (1) of the Schedule “B” in
accordance with the terms of a Trust Deed made between the Chargee and Consolidated
Water Co. Ltd., the Principal or such part thereof as shall then remain unpaid
together with all interest at the rate set out in Item Three (3) of the Schedule “B”
(subject as hereinafter provided) and all other monies hereby secured then remaining
unpaid: and the Chargor HEREBY CHARGES the Charged Premises with the payment of such
Principal and interest and all other monies hereby secured; and the Chargor shall
on demand lawfully being made in writing by the Chargee requiring payment of the
Principal or the balance thereof then outstanding and all interest and other monies
hereby secured and signed on behalf of the Chargee by any of its officers thereunto
authorized or by its Attorneys-at-Law, pay to the Chargee at the place aforesaid the
Principal or the
entire balance then outstanding and all interest and other monies hereby secured
then outstanding.

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	 	B.	 	TO PAY INSTALLMENTS

	 	(i)	 	Until payment in full of the Principal and of all such other
monies hereby secured, to pay to the Chargee at the place aforesaid the sums on
the dates specified in Item Four (4) of Schedule “B” hereto. Such monthly
payments shall be applied FIRSTLY in satisfaction or on account of interest
accrued on the Principal or such part thereof as shall for the time remain
unpaid, which interest shall be computed at the rate specified in Item Three
(3) of the said Schedule “B” from the date of payment of the Principal or any
part thereof to the Chargor and SECONDLY in reduction of the Principal.
	 
	 	(ii)	 	All payments made under and pursuant to this Charge on account
of Principal or interest or otherwise shall be made without set-off or
counter-claim and free and clear of and without future taxes levies, rates,
imposts, duties, deductions, withholdings or other charges of whatsoever
nature.

	 	C.	 	TO PAY RATES, TAXES AND OUTGOINGS
	 
	 	 	 	At all times duly and regularly to pay all rates, taxes, assessments and outgoings
now or hereafter to become due and payable in respect of the Charged Premises and to
produce on demand all receipts and vouchers in proof of such payments.
	 
	 	D.	 	REPAIRS ETC.
	 
	 	 	 	Sub-Section (c) of Section 67 of the Statute shall not apply to this Charge nor to
any instrument of variation executed pursuant to this Charge and instead thereof the
Chargor shall so long as any money remains owing on this Charge or any variation
thereof keep the Buildings on the Charged Premises in good and substantial repair
and condition to the satisfaction of the Chargee and to permit the Chargee or its
agents with or without workmen and others at all reasonable times to enter into or
upon the Charged Premises and examine the state and condition thereof and of the
Building and to forthwith repair and make good all defects and wants of reparation
of which notice in writing shall have been given to the Chargor by the Chargee AND
IN CASE OF DEFAULT to permit the Chargee with or without workmen to enter on the
Charged Premises and effect such repairs to the Building as the Chargee may consider
necessary and on demand to pay to the Chargee all reasonable costs and expenses
incurred in relation to any such inspection and or the effecting of such repairs and
until payment by the Chargor such costs and expenses shall be treated as a further
advance repayable with interest in manner herein provided and in such event the
Chargor shall execute an instrument of variation pursuant to Section 69 of the above
Statute upon such terms as the Chargee shall then require.

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	 	E.	 	RESTRICTIVE AGREEMENTS AND CONDITIONS
	 
	 	 	 	At all times to comply with the restrictive covenants (if any) endorsed on the Land
Register for the Charged Premises or any Buildings thereon and not to use the
Charged Premises or any Buildings thereon for any purpose other than that permitted
by such restrictive covenants and not to alter or add to or cause to be altered or
added to any Building structure or erection on the Charged Premises without the
written consent of the Chargee first had and obtained.
	 
	 	F.	 	INSURANCE
	 
	 	 	 	Sub-Section (d) of Section 67 of the above Statute (and Sub-Section (j) thereof only
so far as it relates to the said Sub-Section (d) shall not apply to this Charge or
to any instrument of variation executed pursuant to this Charge and instead thereof
the Chargor shall so long as any money shall remain owing on the security of this
Charge or any variation thereof insure and keep insured in the joint names of the
Chargor and Chargee any buildings or erections from time to time erected or in the
course of erection of an insurable nature upon being or forming part of the Charged
Premises (whether affixed to the freehold or not) with an insurance office of repute
approved from time to time by the Chargee against loss or damage occasioned by fire
(including fire occasioned by any of the undermentioned perils), lightning, (whether
accompanied by fire or not), earthquake, hurricane, cyclone, tornado, windstorm,
flood (including overflow of the sea), riot, strike, public liabilities and such
other perils and on such other terms and conditions as the Chargee may from time to
time deem fit for a sum not less than the full insurable value of the said
buildings. The interest of the Chargee under the policy or policies of insurance to
be effected on the buildings as hereinbefore provided shall for all purposes be
deemed the primary interest in the said policies the subject matter thereof and the
moneys payable thereunder shall be payable to the Chargee in priority to all other
moneys that may from time to time become payable under any other policy of insurance
of whatsoever class and wheresoever the same may be effected in any name or names
whatsoever, other than that of the Chargee AND it is hereby agreed and declared that
all monies received under or by virtue of any insurance as aforesaid whether
received by the Chargor the Chargee or any receivers appointed by the Chargee
(notwithstanding the provisions of Section 73(7) of the Statute) shall at the
option of the Chargee either be forthwith applied in or towards substantially
rebuilding reinstating or repairing the buildings or erections destroyed or damaged
or in or towards payment of the moneys for the time being secured by these presents
including any premiums paid under the aforesaid power and the Chargor DOTH HEREBY
IRREVOCABLY APPOINT the Chargee the attorney for the Chargor during the subsistence
of this security to collect and receive and give valid receipts and discharges for
all moneys that may be or may become payable to the Chargor under any policies of
insurance with full powers to adjust compromise and submit to arbitration and give
receipts and acquittances for and compound all or any claims under every such policy
of insurance and the said policy shall be deposited at the offices of the Chargee
during the continuance of this security.
	 
	 	G.	 	TO PAY INSURANCE PREMIUMS
	 
	 	 	 	At all times to punctually pay every sum from time to time payable for keeping on
foot every such insurance or within seven (7) days after the first day upon which it
becomes payable and on demand deliver to the Chargee the policy or policies of

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	 	 	 	such insurance duly endorsed as aforesaid or other proper evidence of the
subsistence thereof and also on demand to deliver to the Chargee the receipts for or
other sufficient evidence of repayment of every sum payable as aforesaid AND it is
hereby agreed and declared that if the Chargor shall make default in any of the
above matters the Chargee may insure and keep insured all or any of the
Buildings in manner aforesaid and that the expense of so doing shall be paid by the
Chargor to the Chargee on demand and in the meantime shall be added to the Principal
sum and bear interest accordingly in manner herein provided and in such event the
Chargor shall execute an instrument of variation pursuant to Section 69 of the
Statute upon such terms as the Chargee shall then require.
	 
	 	H.	 	NOT TO SELL LEASE CHARGE ETC.
	 
	 	 	 	Sub-Sections (f) and (g) of Section 67 of the Statute shall not apply to this
Charge nor to any instrument of variation executed pursuant to this Charge and
instead thereof the Chargor shall not during the continuance of this security
without prior consent in writing of the Chargee which consent shall not be
unreasonably withheld sell lease charge let or otherwise part with the possession of
the Charged Premises or the Buildings whether by license trust or otherwise and in
the event of the Chargee giving consent to lease or let the said Charged Premises or
the buildings and effects thereon to require the proposed lessee or tenant to enter
into a covenant direct with the Chargee to pay the rent so accruing direct to the
Chargee.
	 
	 	I.	 	NOT TO ASSIGN CHARGE
	 
	 	 	 	Not to assign or transfer this Charge to any purchaser, assignee, or other successor
in title to the Charged Premises without the Chargee’s express consent in writing.
	 
	 	J.	 	NOT TO RANK PARI PASSU
	 
	 	 	 	Not to apply for or accept any loan which by virtue of any law or regulation will
rank pari passu with or in priority to this security in respect of the Charged
Premises the subject of this Charge nor to do any act which shall have the effect of
diminishing or decreasing the value of the security hereby charged without first
obtaining the written consent of the Chargee.
	 
	 	K.	 	NOT TO MAKE ALTERATIONS OR ADDITIONS
	 
	 	 	 	Not to without the written consent of the Chargee first had and obtained which
consent shall not be unreasonably withheld make or permit or suffer to be made any
material change or additions whatsoever in or to the Charged Premises or the
Buildings the subject of this security or the use hereof.
	 
	 	L.	 	CHARGOR’S COSTS AND FEES
	 
	 	 	 	To pay the examination of the title herein and preparation of this Charge together
with the Stamp Duty and registration fees now or hereafter payable on this Charge or
any instrument of variation or discharge or partial discharge or power of attorney
executed pursuant to this Charge and any such monies as aforesaid shall be
recoverable from the Chargor as a debt, shall bear interest at the rate hereinbefore
mentioned and shall be charged upon the property hereby charged.

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	 	M.	 	WHERE CHARGOR IS A COMPANY (ONLY)

	 	(i)	 	Chargor’s Warranty
	 
	 	 	 	The Chargor hereby represents and warrants to the Chargee that it is duly
incorporated and existing in good standing under the laws of the Cayman
Islands (or under the laws of some other jurisdiction and duly registered to
carry on business in the Cayman Islands) and that it is qualified to do
business wherever necessary to carry on its present operations and that the
making and performance of this Charge is within its corporate powers having
been properly authorised by all necessary governmental and corporate
approvals and does not contravene any law or any contractual restrictions
binding on the Chargor and that the Charge is a legal valid and binding
obligation of the Chargor enforceable against the Chargor in accordance with
its terms and that there are not now any pending or threatened actions or
proceedings before any court or administrative agency which may materially
adversely affect the Chargor’s financial conditions and operations.
	 
	 	(ii)	 	Not to Change Corporate Structure
	 
	 	 	 	Not to reorganize, consolidate, merge or amalgamate with any other
corporation or corporations or make or cause any change in the existing
shareholdings without the prior written consent of the Chargee.

	 	N.	 	CHARGOR’S POWER OF ATTORNEY
	 
	 	 	 	The Chargor further hereby covenants that the Chargor will on demand at the
Chargor’s own cost and expense during the continuance of this Charge do and execute
or cause to be done and executed all such instruments acts deed and things to
perfect this security and to preserve and protect the rights and privileges of the
Chargee granted by this Charge or by operation of law and to this end the Chargor
hereby undertakes and agrees on demand to execute cause to be verified and deliver
to the Chargee a power of attorney, in favour of the Chargee in form required by the
Chargee to enable the Chargee to enter the same in the register of powers of
attorney or with the consent of the Registrar of Lands to file a copy thereof
certified by the Registrar of Lands in the file of powers of attorney.

	 	3.	 	CHARGEE’S EXPENSES
	 
	 	 	 	Without prejudice to and in addition to any other remedy of the Chargee in respect thereof
the Chargor HEREBY COVENANTS with the Chargee that on demand the Chargor will pay to the
Chargee the amount of all the Chargee’s expenses incurred by the Chargee in relation to the
security hereby constituted with interest thereon from the date when the Chargor becomes
liable therefor until payment thereof at the rate for the time being payable hereunder in
the manner hereby provided with regard to the payment of interest and the Chargor HEREBY
CHARGES the Charged Premises with the payment of such expenses and the interest thereon and
for the avoidance of doubt it is hereby declared that the expression “Chargee’s expense”
includes not only all such expenses as would otherwise be allowable on the taking of an
account between the Chargor and a Chargee but also (and in so far as they are not so
allowable) includes all

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	 	 	 	moneys, costs, charges and expenses paid and all liabilities incurred by the Chargee
(including legal costs, charges and expenses ascertained as between Attorney-at-Law and own
client) on or in connection with or incidental to the Charged Premises and security and
without prejudice to the generality of the foregoing shall include all moneys, costs,
charges and expenses paid and all liabilities incurred by the Chargee in
           or in connection with or incidental to, amongst other things:-

	 	a.	 	Effecting any insurance whatever on or in connection with the Charged Premises
or any part thereof;
	 
	 	b.	 	Inspecting surveying or obtaining any report of any nature or kind whatsoever
on or in relation to the Charged Premises or any building or other erection or
engineering work thereon or any part or parts thereof;
	 
	 	c.	 	Considering or enforcing or attempting to enforce any of the rights and powers
hereby or by Law vested in the Chargee in relation to the Charged Premises or this
security;
	 
	 	d.	 	Doing or considering any other matter or thing whatsoever which the Chargee may
consider to be for the benefit, preservation or improvement of this security.

	 	4.	 	VARIATION OF RATE OF INTEREST
	 
	 	 	 	Intentionally deleted.
	 
	 	5.	 	RIGHT TO PREPAY PRINCIPAL
	 
	 	 	 	Intentionally deleted.
	 
	 	6.	 	SERVICE OF NOTICE
	 
	 	 	 	Any demand or notice hereunder shall be properly and effectually made given and served on
the Chargor at any time by letter or other instrument in writing signed by the Chargee or on
its behalf by its Attorney-at-Law, agent, clerk or other person authorized either in writing
or orally by the Directors and addressed to the Chargor and left in some conspicuous place
on the Charged Premises or sent by registered post to his address appearing in the Land
Register or to his address appearing in this Instrument or the address subsequently
furnished by the Chargor to the Chargee and every such demand or notice sent by post as
aforesaid shall be deemed to have been given and served on the fifth (5th) day following the
posting thereof.
	 
	 	7.	 	WAIVER
	 
	 	 	 	That no neglect or omission on the part of the Chargee to take advantage of or enforce any
right or remedy arising out of any breach non-observance or non-performance of any covenant
or condition herein contained or by law implied, shall be deemed to be or operate as a
general waiver of such covenant or condition or prejudice the right of the Chargee in
enforcing or taking advantage thereof either original or recurring.

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	 	8.	 	LOSS
	 
	 	 	 	The Chargee shall not be answerable for any loss happening in or about the exercise or
execution of any powers conferred on the Chargee howsoever or by Law implied or of any
trusts connected thereto nor shall be deemed a Chargee in possession when entering in to
inspect or to effect repairs or remedy breaches.
	 
	 	9.	 	MERGER
	 
	 	 	 	The taking of a judgment or judgments or any covenant or covenants herein contained shall
not operate as a merger of the said covenant or covenants or affect the Chargee’s rights to
interest at the rate and times herein set forth.
	 
	 	10.	 	SAFEKEEPING OF DOCUMENTS (IF ANY)
	 
	 	 	 	The Chargee shall be entitled to keep and retain all relevant documents referred to herein
for the Charged Premises during the continuance of this security subject to production to
the Registrar of Lands and any person or company approved by the Chargee from time to time
at the request and cost of the Chargor to enable endorsements thereon of any transaction
affecting the Charged Premises which may be subject or subsequent to this security PROVIDED
HOWEVER that if the said documents held by the Chargee in relation to the said Charged
Premises or these presents is and/or are destroyed or suffer damage as the result of any
fire, Act of God, civil commotion or the Queen’s enemies the Chargee shall not be held
liable for such loss or destruction nor shall the Chargee be called upon to obtain another
original document or copy or copies of any of the said documents in place of those lost
and/or destroyed as aforesaid. The Chargee however shall be entitled but not obliged to
obtain another original document and/or certified copy or copies of the said documents and
the costs and expenses if any incidental thereto shall be payable by the Chargor under the
Chargor’s covenants herein.
	 
	 	11.	 	EVENTS OF DEFAULT
	 
	 	 	 	The provisions of Sections 72 and 75 of the Statute shall apply to this Charge subject to
such modifications and additions and varied events as are herein contained if any other
creditors of the Chargor shall proceed against the Charged Premises or any part thereof or
if the Chargor shall commit a breach of any of the agreements and covenants on its behalf
herein contained or implied and on the part of the Chargor to be kept observed and performed
or if the Chargor shall become bankrupt or makes assignment of any composition for the
benefit of the Chargor’s creditors or being a company goes into liquidation (other than a
voluntary liquidation for the purposes of a reconstruction only the terms of which have been
previously approved by the Chargee) or suffers the appointment of a receiver over any part
of the Chargor’s assets and in addition to all other rights conferred on the Chargee it
shall be lawful for the Chargee to enter into and upon the premises the subject of this
security and to receive the rents and profits thereof to or for the Chargee’s own use and
benefit or to make use of all or any of the Chargee’s present or future securities in such
order and lawful or equitable manner as the Chargee may be advised.
	 
	 	12.	 	CHARGEE’S REMEDIES
	 
	 	 	 	Sections 72 and 75 of the Statute shall be varied in respect of this Charge and of any
instrument of variation executed pursuant to this Charge so as to entitle the Chargee

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	 	 	 	immediately upon default by the Chargor in payment of the whole or any part of any sum
payable specified in Item Four (4) of the Schedule “B” or whenever there shall be any breach
or non-observance of any covenants or conditions expressed or implied herein to serve on the
Chargor notice in writing to pay the money owing or to perform and observe the agreement as
the case may be and further so as to provide that if the Chargor does not comply within one
month of the date of service of such notice the Chargee may thereupon without further notice
either:-

	 	(a)	 	appoint a receiver of the income of the Charged Premises; or
	 
	 	(b)	 	sell the Charged Premises without further notice by private treaty as well as by public
auction; or
	 
	 	(c)	 	enter into possession of the charged property; or
	 
	 	(d)	 	in the event that the Chargee does appoint a receiver or enter into possession
of
the charged property, exercise its powers of sale or appointment of a receiver
at any time thereafter without further notice;

	 	 	 	PROVIDED ALWAYS and it is hereby expressly declared and agreed that in any case where any
such modification of the Statute (or any other modification provided for in this Charge)
shall require the sanction of the Court the Chargee shall have the right at its option to
waive any modification where it is in favour of the Chargee or to seek the sanction of the
Court thereto and should the Chargee fail to obtain the sanction of the Court to any
particular modification or should the Chargee elect to waive its rights under any
modification then the original provisions of the Statute shall apply without modification.
	 
	 	13.	 	FURTHER ADVANCES AND CONSOLIDATION
	 
	 	 	 	The right contained in Section 81(1) of the Statute to make further advances and to give
credit to the Chargor on a current or continuing account and the right contained in Section
82 of the Statute to consolidate charges are expressly reserved to the Chargee.
	 
	 	14.	 	POWER TO TRANSFER CHARGE
	 
	 	 	 	The Chargee may at any time transfer assign or charge the benefit of this Charge and the
transferee shall have the benefit of all the covenants by the Chargor and the provisions
herein contained and may at any time thereafter exercise all rights and remedies of the
Chargee for securing the said sum and interest and every statement of fact contained in
such transfer shall as against the Chargor be deemed to be conclusive and binding.
	 
	 	15.	 	THE GIVING OF TIME
	 
	 	 	 	The giving of time to the Chargor or the neglect or forbearance of the Chargee in requiring
or enforcing payment of the Principal and interest hereby secured or any other variation of
the provisions of this instrument or other dealing between the Chargor and the Chargee shall
not in any way prejudice or affect this security or the joint and several covenants of the
Chargor hereinbefore contained or the continuing liability of the Chargor by virtue thereof.

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	 	16.	 	RIGHT OF REDEMPTION
	 
	 	 	 	This security is a continuing security to the Chargee and shall avail the Chargee in
respect of all present and future indebtedness of the Chargor to the Chargee which may arise
hereunder and shall continue notwithstanding any payments from time to time made by the
Chargor or other settlement of account or other thing whatsoever, but it is hereby agreed
that upon performance of all the Chargor’s obligations hereunder and upon payment to the
Chargee of all moneys secured or payable hereunder the Chargee will at any time thereafter
at the request and costs of the Chargor discharge this Charge.
	 
	 	17.	 	ORDER OF REALIZING SECURITY
	 
	 	 	 	This security shall not be affected by nor affect any other security which the Chargee may
now or hereafter hold from the Chargor or any other person and the Chargee shall be at
liberty to realize its securities in such order and manner and to apply and appropriate any
monies at any time or times paid by or on behalf of the Chargor or resulting from a
realization of this or any other security or any part thereof to such account or item of
indebtedness and in such sequence, priority and order as the Chargee may in its absolute
discretion from time to time determine, any direction from the Chargor to the contrary
notwithstanding.
	 
	 	19.	 	CHARGEE’S EXERCISE OF REMEDIES
	 
	 	 	 	The Chargee shall be entitled to exercise its remedies under this Charge concurrently,
consecutively or in such order as the Chargee in its discretion may from time to time
decide and without exercising or exhausting any one remedy before proceeding with another.
	 
	 	20.	 	THE WORDS “CHARGOR”, “CHARGEE”, ETC.
	 
	 	 	 	The words “Chargor”, “Chargee”, and “Attorney” herein used importing the singular number
only shall where the context so requires or admits be deemed also to include the plural
number and the words “he”, “his”, “him” and “himself” referring to the Chargor appearing
herein importing the masculine gender and singular number shall where the context so
requires or admits be deemed to include also the feminine and neuter genders and the plural
number and if there be more than one Chargor and Guarantor (if any) covenants and
agreements expressed to be made by the Chargor and Guarantor shall be deemed to be made by
such persons jointly and severally.
	 
	 	21.	 	CHARGE AS CONTINUING SECURITY
	 
	 	 	 	Intentionally deleted.
	 
	 	22.	 	TREATMENT OF WOODEN CONSTRUCTION
	 
	 	 	 	Where a building on the charged property is, in the opinion of the Chargee or any Quantity
Surveyor employed by the Chargee, of lumber or part lumber construction, the Chargor
covenants that he will, at his expense, have a pest control agency inspect and, where
necessary, eradicate termites in the structure and render written confirmation to

12

 

	 	 	 	the Chargor that the building is termite free, such written confirmation to be rendered once
in every 12 months that any bond remains outstanding. Should the chargor omit or otherwise
fail to have these inspections made, the Chargee will then have the right to have any such
inspections and treatments undertaken and the Chargor hereby covenants that the cost of such
inspection and treatment will be payable by the Chargor on demand of the Chargee together
with the cost of any surveyor or other professional who the Chargee deems necessary to
employ to ascertain the extent of any termite or other wood boring organism infestation and
to eradicate the same together with interest on such costs at the rate payable under the
principal sum as hereinbefore provided.
	 
	 	23.	 	DIRECTIONS TO REGISTRAR OF LANDS
	 
	 	 	 	AND the Registrar of Lands is hereby requested and directed pursuant to Section 64 (3), 68,
69, 81 and 82 of the said Law:

	 	(a)	 	to register the Statutory Charge and this schedule in favour of the Chargee;
and
	 
	 	(b)	 	to note on the Register that the Statutory Charge and this schedule:

	 	(i)	 	contain an agreement by the Chargor with the Chargee that the
Chargor may not without the prior written consent of the Chargee lease, charge,
let or otherwise part with possession of the charged property;
	 
	 	(ii)	 	contain an agreement by the Chargor with the Chargee that the
Chargor may not sell or transfer the charged property;
	 
	 	(iii)	 	include provision for the Chargee to make further advances, to
tack and to rank in priority to any subsequent charge;
	 
	 	(iv)	 	give to the Chargee the right to consolidate the Statutory
Charge and this schedule with any other charge;
	 
	 	(v)	 	contain an agreement by the Chargor with the Chargee that the
Chargor will not without first obtaining the prior written consent of the
Chargee create or purport or attempt to create any charge, encumbrance or
mortgage which by virtue of any law or regulation will rank pari passu with or
in priority to the Statutory Charge.

	 	24.	 	CAPTIONS
	 
	 	 	 	The captions appearing at the head of each clause and sub-clause of this Schedule to the
Charge have been inserted as a matter of convenience and for reference only and shall not
define limit or enlarge the scope or meaning of this Schedule or Charge or any provision
hereof.
	 
	 	25.	 	CAYMAN LAW
	 
	 	 	 	This Schedule shall be governed and construed solely according to the Laws of the Cayman
Islands.

13

 

AND FOR BETTER SECURING to the Chargee the payment of the moneys intended to be hereby secured and
every part thereof for Principal, interest, costs, expenses or otherwise the Chargor HEREBY CHARGES
to the Chargee all his estate and interest and all the estate and interest which he is entitled or
able to transfer and dispose of in ALL THAT parcel of land described in Item Five (5) of the
Schedule “B” hereto.

	 	 	 	 	 	 	 
	SIGNED by the Chargors in the

	 	 	)	 	 	CAYMAN WATER COMPANY LIMITED
	presence of

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	Frederick
W. McTaggart
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	Donald Miller 
 

Witness

	 	 	)

)

)

)	 	 	Greg
McTaggart
 

	 
	SIGNED for and on behalf of Chargee

in the presence of

	 	 	)	 	 	 
	 

	 	 	)	 	 	DEXTRA BANK & TRUST CO. LTD.
	 
	 	 	 	 	 	 
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	Alex
Wood
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	Donald Miller 
 

Witness

	 	 	)

)

)

)	 	 	Alitsia
Finlayson

 

14

 

SCHEDULE “B”

	 	 	 	 	 	 	 
	 	1.	 	 	DATE BONDS REPAYABLE:

	 	On demand upon occurrence of an event of default.
	 	 	 	 	 
	 	 
	 	2.	 	 	PRINCIPAL SUM:

	 	US$15,771,997.00
	 	 	 	 	 
	 	 
	 	3.	 	 	INTEREST RATE:

	 	Payable in accordance with a
Trust Deed made between the
Chargee and Consolidated
Water Co. Ltd.
	 	 	 	 	 
	 	 
	 	4.	 	 	AMOUNT OF MONTHLY PAYMENT

OF PRINCIPAL AND INTEREST:

	 	Payable in accordance with the terms
of a Trust Deed made between the Chargee
and Consolidated Water Co. Ltd.
	 	 	 	 	 
	 	 
	 	5.	 	 	THE CHARGED PREMISES:

	 	WEST BAY BEACH NORTH BLOCK 11D
PARCEL 8

15Ex-10.12 Cayman Islands Collateral Charge

 

EXHIBIT
10.12

 

			
	FORM RL9
	 	INSTRUMENT NO.
	 
	 	 

CAYMAN ISLANDS

The Registered Land Law (2004 Revision)

THIRD SCHEDULE

COLLATERAL CHARGE

(Collateral to A Debenture)

	 	 	 	 	 	 	 
	REGISTRATION SECTION

	 	BLOCK
	 	PARCEL

	WEST BAY NORTH EAST

	 	9A
	 	 	8	 

I/WE, CAYMAN WATER COMPANY LIMITED

HEREBY CHARGE my/our interest in the above mentioned title to secure the payment

to     DEXTRA BANK & TRUST CO. LTD.

of     198 North Church Street, George Town, Grand Cayman, Cayman Islands

of the principal sum of FIFTEEN MILLION SEVEN HUNDRED SEVENTY-ONE THOUSAND NINE HUNDRED
NINETY-SEVEN UNITED STATES DOLLARS (US$15,771,997.00)

with interest at the rate as set out in Schedules A and B attached hereto, payable in accordance
with the
terms of Schedule A and B attached, subject to section 67 of the above law, unless hereby
negatived,
modified or added to. (Here set forth any variation, or make reference to an attached document).

     1)   Requests to Registrar

     2)   Schedule A

     3)   Schedule B

     The principal sum shall be repaid on demand and otherwise in accordance with Schedules A and B
attached hereto together with any interest then due.

     And I/WE the above named Chargor(s) hereby acknowledge that we understand the effect of
section 72 of the Registered Land Law, (2004 Revision).

Dated
this 4th day of August 2006

CAYMAN WATER COMPANY LIMITED

	 	 	 
	Signed by the Chargor
	 	Frederick
W.
McTaggart                 Greg
McTaggart

director                                          director/secretary

	 
	 	 

	in the presence of:- 
	 	Donald
Miller

            DEXTRA BANK & TRUST CO. LTD.

	Signed by the Chargee
	 	Alex
Wood                                    Alitsia
Finlayson

director                                          director/secretary

	 
	 	 

	in the presence of:-
	 	Donald
Miller

 

FOR OFFICIAL USE ONLY

I, the Registrar of Lands in the Cayman Islands hereby certify that this document was
received by me for registration on the
.......................................... day of
...............200......
and that stamp duty assessed/adjudicated by me/Treasury at
C.I.$..........and
Land Registry fees at C.I.$......................................... relating thereto have been paid.

REGISTERED this                      day of                      200

.........................................

REGISTRAR OF LANDS, CAYMAN ISLANDS

 

 

CERTIFICATE
OF IDENTIFICATION

CAYMAN WATER COMPANY LIMITED

By:

By:

Name................................................................................. .

I HEREBY CERTIFY that the above named person..................................................................................

appeared before me on the ........ day of July 2006 and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

CERTIFICATE OF IDENTIFICATION

DEXTRA BANK & TRUST CO. LTD.

By:

By:

Name................................................................................. .

I HEREBY CERTIFY that the above named ..................................................................................

appeared before me on the ........ day of July 2006 and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

CERTIFICATE OF IDENTIFICATION

Name................................................................................. .

I HEREBY CERTIFY that the above named ..................................................................................

appeared before me on the ........ day of ........................
200 ........ and

being identified by*......................................... (or being known to me)

acknowledged the above signature or mark to be his/theirs and that he/they had freely and

voluntarily executed this instrument and understood its contents.

..................................................................................

Signature and designation of the person certifying

			
	*NOTE:	 	Please ensure that the appropriate insertions and/or deletions are made

so that the method of identification is clear.

2

 

THE REGISTRAR OF LANDS IS HEREBY REQUESTED

	a)	 	to register this Charge in favour of the Chargee;
	 
	b)	 	to note on the register that the attached schedule contains an agreement by the Chargor with
the Chargee that the Chargor will not without first obtaining the prior written consent of the
Chargee, sell, lease or sub-lease or agree to lease or sub-lease, charge, let or assign or
transfer or otherwise part with the possession of the charged premises or any part thereof;
	 
	(c)	 	to note on the register that the right to tack and rank in priority to any subsequent charge
is expressly reserved to the Chargee;
	 
	(d)	 	to note on the register that the attached Schedule reserved to the Chargee the right to
consolidate this Charge with any other charge;
	 
	(e)	 	to note on the register that the attached Schedule contains an agreement by the Chargor with
the Chargee that the Chargor will not without first obtaining the prior written consent of the
Chargee create or purport or attempt to create any charge, incumbrance or mortgage which by
virtue of any law or regulation will rank pari passu with or in priority to this Charge or
second or subsidiary to this Charge.

3

 

SCHEDULE “A”

NOW THIS INSTRUMENT WITNESSETH as follows:-

	1.	 	INTERPRETATION
	 
	 	 	Throughout this instrument unless the context otherwise requires the following expressions

have the following meanings:-

	 	a.	 	“The Chargor”, “the Guarantor” (if any) and “the Chargee” includes besides the
parties hereto their respective personal representatives, successors in title and
transferees.
	 
	 	b.	 	“The Principal” means the principal sum hereby advanced and secured and set out
in Item Two (2) of the Schedule “B” hereto.
	 
	 	c.	 	“The Statute” means the Registered Land Law or any re-enactment thereof or any
enactment amending the same.
	 
	 	d.	 	“The Board of Directors” means the Directors of DEXTRA BANK & TRUST CO.
LTD. from time to time.
	 
	 	e.	 	“The Charged Premises” means the land the subject of this Charge as set out in
Item Five (5) of the Schedule “B” hereto.
	 
	 	f.	 	“The Building” or “Buildings” means any building or erection erected on the
Charged Premises whether or not permanently attached thereto and includes all fixtures
and fittings and any chattels owned by the Chargor and used in or about the Charged
Premises.

	2.	 	COVENANTS BY THE CHARGOR
	 
	 	 	In consideration of the Principal lent and advanced by the Chargee to the Chargor at the
request of the Chargor (the receipt whereof is hereby acknowledged), the Chargor HEREBY
COVENANTS with the Chargee during the continuance of this security as follows:-

	 	A.	 	TO PAY PRINCIPAL
	 
	 	 	 	To pay to the Chargee on the date specified in Item One (1) of the Schedule “B” in
accordance with the terms of a Trust Deed made between the Chargee and Consolidated
Water Co. Ltd., the Principal or such part thereof as shall then remain unpaid
together with all interest at the rate set out in Item Three (3) of the Schedule “B”
(subject as hereinafter provided) and all other monies hereby secured then remaining
unpaid: and the Chargor HEREBY CHARGES the Charged Premises with the payment of such
Principal and interest and all other monies hereby secured; and the Chargor shall
on demand lawfully being made in writing by the Chargee requiring payment of the
Principal or the balance thereof then outstanding and all interest and other monies
hereby secured and signed on behalf of the Chargee by any of its officers thereunto
authorized or by its Attorneys-at-Law, pay to the Chargee at the place aforesaid the
Principal or the
entire balance then outstanding and all interest and other monies hereby secured
then outstanding.

4

 

	 	B.	 	TO PAY INSTALLMENTS

	 	(i)	 	Until payment in full of the Principal and of all such other
monies hereby secured, to pay to the Chargee at the place aforesaid the sums on
the dates specified in Item Four (4) of Schedule “B” hereto. Such monthly
payments shall be applied FIRSTLY in satisfaction or on account of interest
accrued on the Principal or such part thereof as shall for the time remain
unpaid, which interest shall be computed at the rate specified in Item Three
(3) of the said Schedule “B” from the date of payment of the Principal or any
part thereof to the Chargor and SECONDLY in reduction of the Principal.
	 
	 	(ii)	 	All payments made under and pursuant to this Charge on account
of Principal or interest or otherwise shall be made without set-off or
counter-claim and free and clear of and without future taxes levies, rates,
imposts, duties, deductions, withholdings or other charges of whatsoever
nature.

	 	C.	 	TO PAY RATES, TAXES AND OUTGOINGS
	 
	 	 	 	At all times duly and regularly to pay all rates, taxes, assessments and outgoings
now or hereafter to become due and payable in respect of the Charged Premises and to
produce on demand all receipts and vouchers in proof of such payments.
	 
	 	D.	 	REPAIRS ETC.
	 
	 	 	 	Sub-Section (c) of Section 67 of the Statute shall not apply to this Charge nor to
any instrument of variation executed pursuant to this Charge and instead thereof the
Chargor shall so long as any money remains owing on this Charge or any variation
thereof keep the Buildings on the Charged Premises in good and substantial repair
and condition to the satisfaction of the Chargee and to permit the Chargee or its
agents with or without workmen and others at all reasonable times to enter into or
upon the Charged Premises and examine the state and condition thereof and of the
Building and to forthwith repair and make good all defects and wants of reparation
of which notice in writing shall have been given to the Chargor by the Chargee AND
IN CASE OF DEFAULT to permit the Chargee with or without workmen to enter on the
Charged Premises and effect such repairs to the Building as the Chargee may consider
necessary and on demand to pay to the Chargee all reasonable costs and expenses
incurred in relation to any such inspection and or the effecting of such repairs and
until payment by the Chargor such costs and expenses shall be treated as a further
advance repayable with interest in manner herein provided and in such event the
Chargor shall execute an instrument of variation pursuant to Section 69 of the above
Statute upon such terms as the Chargee shall then require.

5

 

	 	E.	 	RESTRICTIVE AGREEMENTS AND CONDITIONS
	 
	 	 	 	At all times to comply with the restrictive covenants (if any) endorsed on the Land
Register for the Charged Premises or any Buildings thereon and not to use the
Charged Premises or any Buildings thereon for any purpose other than that permitted
by such restrictive covenants and not to alter or add to or cause to be altered or
added to any Building structure or erection on the Charged Premises without the
written consent of the Chargee first had and obtained.
	 
	 	F.	 	INSURANCE
	 
	 	 	 	Sub-Section (d) of Section 67 of the above Statute (and Sub-Section (j) thereof only
so far as it relates to the said Sub-Section (d) shall not apply to this Charge or
to any instrument of variation executed pursuant to this Charge and instead thereof
the Chargor shall so long as any money shall remain owing on the security of this
Charge or any variation thereof insure and keep insured in the joint names of the
Chargor and Chargee any buildings or erections from time to time erected or in the
course of erection of an insurable nature upon being or forming part of the Charged
Premises (whether affixed to the freehold or not) with an insurance office of repute
approved from time to time by the Chargee against loss or damage occasioned by fire
(including fire occasioned by any of the undermentioned perils), lightning, (whether
accompanied by fire or not), earthquake, hurricane, cyclone, tornado, windstorm,
flood (including overflow of the sea), riot, strike, public liabilities and such
other perils and on such other terms and conditions as the Chargee may from time to
time deem fit for a sum not less than the full insurable value of the said
buildings. The interest of the Chargee under the policy or policies of insurance to
be effected on the buildings as hereinbefore provided shall for all purposes be
deemed the primary interest in the said policies the subject matter thereof and the
moneys payable thereunder shall be payable to the Chargee in priority to all other
moneys that may from time to time become payable under any other policy of insurance
of whatsoever class and wheresoever the same may be effected in any name or names
whatsoever, other than that of the Chargee AND it is hereby agreed and declared that
all monies received under or by virtue of any insurance as aforesaid whether
received by the Chargor the Chargee or any receivers appointed by the Chargee
(notwithstanding the provisions of Section 73(7) of the Statute) shall at the
option of the Chargee either be forthwith applied in or towards substantially
rebuilding reinstating or repairing the buildings or erections destroyed or damaged
or in or towards payment of the moneys for the time being secured by these presents
including any premiums paid under the aforesaid power and the Chargor DOTH HEREBY
IRREVOCABLY APPOINT the Chargee the attorney for the Chargor during the subsistence
of this security to collect and receive and give valid receipts and discharges for
all moneys that may be or may become payable to the Chargor under any policies of
insurance with full powers to adjust compromise and submit to arbitration and give
receipts and acquittances for and compound all or any claims under every such policy
of insurance and the said policy shall be deposited at the offices of the Chargee
during the continuance of this security.
	 
	 	G.	 	TO PAY INSURANCE PREMIUMS
	 
	 	 	 	At all times to punctually pay every sum from time to time payable for keeping on
foot every such insurance or within seven (7) days after the first day upon which it
becomes payable and on demand deliver to the Chargee the policy or policies of

6

 

	 	 	 	such insurance duly endorsed as aforesaid or other proper evidence of the
subsistence thereof and also on demand to deliver to the Chargee the receipts for or
other sufficient evidence of repayment of every sum payable as aforesaid AND it is
hereby agreed and declared that if the Chargor shall make default in any of the
above matters the Chargee may insure and keep insured all or any of the
Buildings in manner aforesaid and that the expense of so doing shall be paid by the
Chargor to the Chargee on demand and in the meantime shall be added to the Principal
sum and bear interest accordingly in manner herein provided and in such event the
Chargor shall execute an instrument of variation pursuant to Section 69 of the
Statute upon such terms as the Chargee shall then require.
	 
	 	H.	 	NOT TO SELL LEASE CHARGE ETC.
	 
	 	 	 	Sub-Sections (f) and (g) of Section 67 of the Statute shall not apply to this
Charge nor to any instrument of variation executed pursuant to this Charge and
instead thereof the Chargor shall not during the continuance of this security
without prior consent in writing of the Chargee which consent shall not be
unreasonably withheld sell lease charge let or otherwise part with the possession of
the Charged Premises or the Buildings whether by license trust or otherwise and in
the event of the Chargee giving consent to lease or let the said Charged Premises or
the buildings and effects thereon to require the proposed lessee or tenant to enter
into a covenant direct with the Chargee to pay the rent so accruing direct to the
Chargee.
	 
	 	I.	 	NOT TO ASSIGN CHARGE
	 
	 	 	 	Not to assign or transfer this Charge to any purchaser, assignee, or other successor
in title to the Charged Premises without the Chargee’s express consent in writing.
	 
	 	J.	 	NOT TO RANK PARI PASSU
	 
	 	 	 	Not to apply for or accept any loan which by virtue of any law or regulation will
rank pari passu with or in priority to this security in respect of the Charged
Premises the subject of this Charge nor to do any act which shall have the effect of
diminishing or decreasing the value of the security hereby charged without first
obtaining the written consent of the Chargee.
	 
	 	K.	 	NOT TO MAKE ALTERATIONS OR ADDITIONS
	 
	 	 	 	Not to without the written consent of the Chargee first had and obtained which
consent shall not be unreasonably withheld make or permit or suffer to be made any
material change or additions whatsoever in or to the Charged Premises or the
Buildings the subject of this security or the use hereof.
	 
	 	L.	 	CHARGOR’S COSTS AND FEES
	 
	 	 	 	To pay the examination of the title herein and preparation of this Charge together
with the Stamp Duty and registration fees now or hereafter payable on this Charge or
any instrument of variation or discharge or partial discharge or power of attorney
executed pursuant to this Charge and any such monies as aforesaid shall be
recoverable from the Chargor as a debt, shall bear interest at the rate hereinbefore
mentioned and shall be charged upon the property hereby charged.

7

 

	 	M.	 	WHERE CHARGOR IS A COMPANY (ONLY)

	 	(i)	 	Chargor’s Warranty
	 
	 	 	 	The Chargor hereby represents and warrants to the Chargee that it is duly
incorporated and existing in good standing under the laws of the Cayman
Islands (or under the laws of some other jurisdiction and duly registered to
carry on business in the Cayman Islands) and that it is qualified to do
business wherever necessary to carry on its present operations and that the
making and performance of this Charge is within its corporate powers having
been properly authorised by all necessary governmental and corporate
approvals and does not contravene any law or any contractual restrictions
binding on the Chargor and that the Charge is a legal valid and binding
obligation of the Chargor enforceable against the Chargor in accordance with
its terms and that there are not now any pending or threatened actions or
proceedings before any court or administrative agency which may materially
adversely affect the Chargor’s financial conditions and operations.
	 
	 	(ii)	 	Not to Change Corporate Structure
	 
	 	 	 	Not to reorganize, consolidate, merge or amalgamate with any other
corporation or corporations or make or cause any change in the existing
shareholdings without the prior written consent of the Chargee.

	 	N.	 	CHARGOR’S POWER OF ATTORNEY
	 
	 	 	 	The Chargor further hereby covenants that the Chargor will on demand at the
Chargor’s own cost and expense during the continuance of this Charge do and execute
or cause to be done and executed all such instruments acts deed and things to
perfect this security and to preserve and protect the rights and privileges of the
Chargee granted by this Charge or by operation of law and to this end the Chargor
hereby undertakes and agrees on demand to execute cause to be verified and deliver
to the Chargee a power of attorney, in favour of the Chargee in form required by the
Chargee to enable the Chargee to enter the same in the register of powers of
attorney or with the consent of the Registrar of Lands to file a copy thereof
certified by the Registrar of Lands in the file of powers of attorney.

	 	3.	 	CHARGEE’S EXPENSES
	 
	 	 	 	Without prejudice to and in addition to any other remedy of the Chargee in respect thereof
the Chargor HEREBY COVENANTS with the Chargee that on demand the Chargor will pay to the
Chargee the amount of all the Chargee’s expenses incurred by the Chargee in relation to the
security hereby constituted with interest thereon from the date when the Chargor becomes
liable therefor until payment thereof at the rate for the time being payable hereunder in
the manner hereby provided with regard to the payment of interest and the Chargor HEREBY
CHARGES the Charged Premises with the payment of such expenses and the interest thereon and
for the avoidance of doubt it is hereby declared that the expression “Chargee’s expense”
includes not only all such expenses as would otherwise be allowable on the taking of an
account between the Chargor and a Chargee but also (and in so far as they are not so
allowable) includes all

8

 

	 	 	 	moneys, costs, charges and expenses paid and all liabilities incurred by the Chargee
(including legal costs, charges and expenses ascertained as between Attorney-at-Law and own
client) on or in connection with or incidental to the Charged Premises and security and
without prejudice to the generality of the foregoing shall include all moneys, costs,
charges and expenses paid and all liabilities incurred by the Chargee in
           or in connection with or incidental to, amongst other things:-

	 	a.	 	Effecting any insurance whatever on or in connection with the Charged Premises
or any part thereof;
	 
	 	b.	 	Inspecting surveying or obtaining any report of any nature or kind whatsoever
on or in relation to the Charged Premises or any building or other erection or
engineering work thereon or any part or parts thereof;
	 
	 	c.	 	Considering or enforcing or attempting to enforce any of the rights and powers
hereby or by Law vested in the Chargee in relation to the Charged Premises or this
security;
	 
	 	d.	 	Doing or considering any other matter or thing whatsoever which the Chargee may
consider to be for the benefit, preservation or improvement of this security.

	 	4.	 	VARIATION OF RATE OF INTEREST
	 
	 	 	 	Intentionally deleted.
	 
	 	5.	 	RIGHT TO PREPAY PRINCIPAL
	 
	 	 	 	Intentionally deleted.
	 
	 	6.	 	SERVICE OF NOTICE
	 
	 	 	 	Any demand or notice hereunder shall be properly and effectually made given and served on
the Chargor at any time by letter or other instrument in writing signed by the Chargee or on
its behalf by its Attorney-at-Law, agent, clerk or other person authorized either in writing
or orally by the Directors and addressed to the Chargor and left in some conspicuous place
on the Charged Premises or sent by registered post to his address appearing in the Land
Register or to his address appearing in this Instrument or the address subsequently
furnished by the Chargor to the Chargee and every such demand or notice sent by post as
aforesaid shall be deemed to have been given and served on the fifth (5th) day following the
posting thereof.
	 
	 	7.	 	WAIVER
	 
	 	 	 	That no neglect or omission on the part of the Chargee to take advantage of or enforce any
right or remedy arising out of any breach non-observance or non-performance of any covenant
or condition herein contained or by law implied, shall be deemed to be or operate as a
general waiver of such covenant or condition or prejudice the right of the Chargee in
enforcing or taking advantage thereof either original or recurring.

9

 

	 	8.	 	LOSS
	 
	 	 	 	The Chargee shall not be answerable for any loss happening in or about the exercise or
execution of any powers conferred on the Chargee howsoever or by Law implied or of any
trusts connected thereto nor shall be deemed a Chargee in possession when entering in to
inspect or to effect repairs or remedy breaches.
	 
	 	9.	 	MERGER
	 
	 	 	 	The taking of a judgment or judgments or any covenant or covenants herein contained shall
not operate as a merger of the said covenant or covenants or affect the Chargee’s rights to
interest at the rate and times herein set forth.
	 
	 	10.	 	SAFEKEEPING OF DOCUMENTS (IF ANY)
	 
	 	 	 	The Chargee shall be entitled to keep and retain all relevant documents referred to herein
for the Charged Premises during the continuance of this security subject to production to
the Registrar of Lands and any person or company approved by the Chargee from time to time
at the request and cost of the Chargor to enable endorsements thereon of any transaction
affecting the Charged Premises which may be subject or subsequent to this security PROVIDED
HOWEVER that if the said documents held by the Chargee in relation to the said Charged
Premises or these presents is and/or are destroyed or suffer damage as the result of any
fire, Act of God, civil commotion or the Queen’s enemies the Chargee shall not be held
liable for such loss or destruction nor shall the Chargee be called upon to obtain another
original document or copy or copies of any of the said documents in place of those lost
and/or destroyed as aforesaid. The Chargee however shall be entitled but not obliged to
obtain another original document and/or certified copy or copies of the said documents and
the costs and expenses if any incidental thereto shall be payable by the Chargor under the
Chargor’s covenants herein.
	 
	 	11.	 	EVENTS OF DEFAULT
	 
	 	 	 	The provisions of Sections 72 and 75 of the Statute shall apply to this Charge subject to
such modifications and additions and varied events as are herein contained if any other
creditors of the Chargor shall proceed against the Charged Premises or any part thereof or
if the Chargor shall commit a breach of any of the agreements and covenants on its behalf
herein contained or implied and on the part of the Chargor to be kept observed and performed
or if the Chargor shall become bankrupt or makes assignment of any composition for the
benefit of the Chargor’s creditors or being a company goes into liquidation (other than a
voluntary liquidation for the purposes of a reconstruction only the terms of which have been
previously approved by the Chargee) or suffers the appointment of a receiver over any part
of the Chargor’s assets and in addition to all other rights conferred on the Chargee it
shall be lawful for the Chargee to enter into and upon the premises the subject of this
security and to receive the rents and profits thereof to or for the Chargee’s own use and
benefit or to make use of all or any of the Chargee’s present or future securities in such
order and lawful or equitable manner as the Chargee may be advised.
	 
	 	12.	 	CHARGEE’S REMEDIES
	 
	 	 	 	Sections 72 and 75 of the Statute shall be varied in respect of this Charge and of any
instrument of variation executed pursuant to this Charge so as to entitle the Chargee

10

 

	 	 	 	immediately upon default by the Chargor in payment of the whole or any part of any sum
payable specified in Item Four (4) of the Schedule “B” or whenever there shall be any breach
or non-observance of any covenants or conditions expressed or implied herein to serve on the
Chargor notice in writing to pay the money owing or to perform and observe the agreement as
the case may be and further so as to provide that if the Chargor does not comply within one
month of the date of service of such notice the Chargee may thereupon without further notice
either:-

	 	(a)	 	appoint a receiver of the income of the Charged Premises; or
	 
	 	(b)	 	sell the Charged Premises without further notice by private treaty as well as by public
auction; or
	 
	 	(c)	 	enter into possession of the charged property; or
	 
	 	(d)	 	in the event that the Chargee does appoint a receiver or enter into possession
of
the charged property, exercise its powers of sale or appointment of a receiver
at any time thereafter without further notice;

	 	 	 	PROVIDED ALWAYS and it is hereby expressly declared and agreed that in any case where any
such modification of the Statute (or any other modification provided for in this Charge)
shall require the sanction of the Court the Chargee shall have the right at its option to
waive any modification where it is in favour of the Chargee or to seek the sanction of the
Court thereto and should the Chargee fail to obtain the sanction of the Court to any
particular modification or should the Chargee elect to waive its rights under any
modification then the original provisions of the Statute shall apply without modification.
	 
	 	13.	 	FURTHER ADVANCES AND CONSOLIDATION
	 
	 	 	 	The right contained in Section 81(1) of the Statute to make further advances and to give
credit to the Chargor on a current or continuing account and the right contained in Section
82 of the Statute to consolidate charges are expressly reserved to the Chargee.
	 
	 	14.	 	POWER TO TRANSFER CHARGE
	 
	 	 	 	The Chargee may at any time transfer assign or charge the benefit of this Charge and the
transferee shall have the benefit of all the covenants by the Chargor and the provisions
herein contained and may at any time thereafter exercise all rights and remedies of the
Chargee for securing the said sum and interest and every statement of fact contained in
such transfer shall as against the Chargor be deemed to be conclusive and binding.
	 
	 	15.	 	THE GIVING OF TIME
	 
	 	 	 	The giving of time to the Chargor or the neglect or forbearance of the Chargee in requiring
or enforcing payment of the Principal and interest hereby secured or any other variation of
the provisions of this instrument or other dealing between the Chargor and the Chargee shall
not in any way prejudice or affect this security or the joint and several covenants of the
Chargor hereinbefore contained or the continuing liability of the Chargor by virtue thereof.

11

 

	 	16.	 	RIGHT OF REDEMPTION
	 
	 	 	 	This security is a continuing security to the Chargee and shall avail the Chargee in
respect of all present and future indebtedness of the Chargor to the Chargee which may arise
hereunder and shall continue notwithstanding any payments from time to time made by the
Chargor or other settlement of account or other thing whatsoever, but it is hereby agreed
that upon performance of all the Chargor’s obligations hereunder and upon payment to the
Chargee of all moneys secured or payable hereunder the Chargee will at any time thereafter
at the request and costs of the Chargor discharge this Charge.
	 
	 	17.	 	ORDER OF REALIZING SECURITY
	 
	 	 	 	This security shall not be affected by nor affect any other security which the Chargee may
now or hereafter hold from the Chargor or any other person and the Chargee shall be at
liberty to realize its securities in such order and manner and to apply and appropriate any
monies at any time or times paid by or on behalf of the Chargor or resulting from a
realization of this or any other security or any part thereof to such account or item of
indebtedness and in such sequence, priority and order as the Chargee may in its absolute
discretion from time to time determine, any direction from the Chargor to the contrary
notwithstanding.
	 
	 	19.	 	CHARGEE’S EXERCISE OF REMEDIES
	 
	 	 	 	The Chargee shall be entitled to exercise its remedies under this Charge concurrently,
consecutively or in such order as the Chargee in its discretion may from time to time
decide and without exercising or exhausting any one remedy before proceeding with another.
	 
	 	20.	 	THE WORDS “CHARGOR”, “CHARGEE”, ETC.
	 
	 	 	 	The words “Chargor”, “Chargee”, and “Attorney” herein used importing the singular number
only shall where the context so requires or admits be deemed also to include the plural
number and the words “he”, “his”, “him” and “himself” referring to the Chargor appearing
herein importing the masculine gender and singular number shall where the context so
requires or admits be deemed to include also the feminine and neuter genders and the plural
number and if there be more than one Chargor and Guarantor (if any) covenants and
agreements expressed to be made by the Chargor and Guarantor shall be deemed to be made by
such persons jointly and severally.
	 
	 	21.	 	CHARGE AS CONTINUING SECURITY
	 
	 	 	 	Intentionally deleted.
	 
	 	22.	 	TREATMENT OF WOODEN CONSTRUCTION
	 
	 	 	 	Where a building on the charged property is, in the opinion of the Chargee or any Quantity
Surveyor employed by the Chargee, of lumber or part lumber construction, the Chargor
covenants that he will, at his expense, have a pest control agency inspect and, where
necessary, eradicate termites in the structure and render written confirmation to

12

 

	 	 	 	the Chargor that the building is termite free, such written confirmation to be rendered once
in every 12 months that any bond remains outstanding. Should the chargor omit or otherwise
fail to have these inspections made, the Chargee will then have the right to have any such
inspections and treatments undertaken and the Chargor hereby covenants that the cost of such
inspection and treatment will be payable by the Chargor on demand of the Chargee together
with the cost of any surveyor or other professional who the Chargee deems necessary to
employ to ascertain the extent of any termite or other wood boring organism infestation and
to eradicate the same together with interest on such costs at the rate payable under the
principal sum as hereinbefore provided.
	 
	 	23.	 	DIRECTIONS TO REGISTRAR OF LANDS
	 
	 	 	 	AND the Registrar of Lands is hereby requested and directed pursuant to Section 64 (3), 68,
69, 81 and 82 of the said Law:

	 	(a)	 	to register the Statutory Charge and this schedule in favour of the Chargee;
and
	 
	 	(b)	 	to note on the Register that the Statutory Charge and this schedule:

	 	(i)	 	contain an agreement by the Chargor with the Chargee that the
Chargor may not without the prior written consent of the Chargee lease, charge,
let or otherwise part with possession of the charged property;
	 
	 	(ii)	 	contain an agreement by the Chargor with the Chargee that the
Chargor may not sell or transfer the charged property;
	 
	 	(iii)	 	include provision for the Chargee to make further advances, to
tack and to rank in priority to any subsequent charge;
	 
	 	(iv)	 	give to the Chargee the right to consolidate the Statutory
Charge and this schedule with any other charge;
	 
	 	(v)	 	contain an agreement by the Chargor with the Chargee that the
Chargor will not without first obtaining the prior written consent of the
Chargee create or purport or attempt to create any charge, encumbrance or
mortgage which by virtue of any law or regulation will rank pari passu with or
in priority to the Statutory Charge.

	 	24.	 	CAPTIONS
	 
	 	 	 	The captions appearing at the head of each clause and sub-clause of this Schedule to the
Charge have been inserted as a matter of convenience and for reference only and shall not
define limit or enlarge the scope or meaning of this Schedule or Charge or any provision
hereof.
	 
	 	25.	 	CAYMAN LAW
	 
	 	 	 	This Schedule shall be governed and construed solely according to the Laws of the Cayman
Islands.

13

 

AND FOR BETTER SECURING to the Chargee the payment of the moneys intended to be hereby secured and
every part thereof for Principal, interest, costs, expenses or otherwise the Chargor HEREBY CHARGES
to the Chargee all his estate and interest and all the estate and interest which he is entitled or
able to transfer and dispose of in ALL THAT parcel of land described in Item Five (5) of the
Schedule “B” hereto.

	 	 	 	 	 	 	 
	SIGNED by the Chargors in the

	 	 	)	 	 	CAYMAN WATER COMPANY LIMITED
	presence of

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	Frederick
W. McTaggart
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	Donald Miller 
 

Witness

	 	 	)

)

)

)	 	 	Greg
McTaggart
 

	 
	SIGNED for and on behalf of Chargee

in the presence of

	 	 	)	 	 	 
	 

	 	 	)	 	 	DEXTRA BANK & TRUST CO. LTD.
	 
	 	 	 	 	 	 
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	Alex
Wood
	 

	 	 	)	 	 	 
	 

	 	 	)	 	 	 
	Donald Miller 
 

Witness

	 	 	)

)

)

)	 	 	Alitsia
Finlayson
 

14

 

SCHEDULE “B”

	 	 	 	 	 	 	 
	 	1.	 	 	DATE BONDS REPAYABLE:

	 	On demand upon occurrence of an event of default.
	 	 	 	 	 
	 	 
	 	2.	 	 	PRINCIPAL SUM:

	 	US$15,771,997.00
	 	 	 	 	 
	 	 
	 	3.	 	 	INTEREST RATE:

	 	Payable in accordance with a
Trust Deed made between the
Chargee and Consolidated
Water Co. Ltd.
	 	 	 	 	 
	 	 
	 	4.	 	 	AMOUNT OF MONTHLY PAYMENT

OF PRINCIPAL AND INTEREST:

	 	Payable in accordance with the terms
of a Trust Deed made between the Chargee
and Consolidated Water Co. Ltd.
	 	 	 	 	 
	 	 
	 	5.	 	 	THE CHARGED PREMISES:

	 	WEST BAY NORTH EAST BLOCK 9A PARCEL
8

15

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