Exhibit 10.31
AGREEMENT
THIS AGREEMENT is made this 1st day of February, 2002,
BETWEEN: CONSOLIDATED WATER CO. LTD.
a Cayman Islands company having its registered office at
Trafalgar Place, West Bay Road, P.O. Box 1114, ▇▇▇▇▇▇ Town,
Grand Cayman B.W.I. ("CWC")
AND: CAYMAN HOTEL & GOLF INC.
a Canada corporation having its address for service in the
Cayman Islands in care of ▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, P.O. Box 1994, ▇▇▇▇▇▇ Town, Grand Cayman
B.W.I.("the Customer")
RECITAL:
The Customer wishes to obtain a supply of potable water in specified volume (i)
by pipe for the Hotel known as the Hyatt Regency, on both sides of the West Bay
Road, Grand Cayman and the irrigation of its golf course and (ii) by the
Customer's truck for the Rum Point restaurant at Rum Point, and CWC has agreed
to supply the water on the terms set out in this Agreement;
AGREEMENT:
1. SUPPLY OF WATER
(1) Subject to sub-clause (4), CWC will supply the Customer from
the Commencement Date until the expiry of the Term, on the
terms and conditions set out in this Agreement potable water
to the quality standard required by its Concession at the
meter or meters referred to in Clause 2(3) at a maximum rate
of 260 gallons per minute at 62 pounds per square inch gauge.
(2) The Volume of water supplied will be a minimum of 170,000 U.S.
gallons per day. The maximum volumes to be supplied will be
the amount from time to time agreed by CWC who must use its
best endeavours to supply the Customer's demands in full.
(3) Notwithstanding that CWC has connected any water supply to a
hydrant or sprinkler system in the Hotel, it is expressly
agreed that CWC will be under no obligation to provide water
for fire fighting purposes or to ensure that the Water Tank
contains water at any time whatever or under any
circumstances, and will only supply water for those purposes
if it is able to do so, and will not be liable for any damage
whatever to the Hotel or any part of it caused by fire or any
related cause.
(4) For the purposes of this Agreement, the water supplied to the
Customer is deemed to be the amount of water shown by:-
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(a) the meter measuring the amount of water passing through the
Fire Pump; plus
(b) the meter measuring the amount of water flowing into the
Irrigation Tank; plus
(c) the Property Meter
less the amount of water shown by the Main Meter.
(5) CWC must give not less than twenty-four (24) hours' notice to
the Customer of any occasion on which to its knowledge the
Water Tank will for any reason contain less than 250,000 U.S.
gallons of water and if in circumstances unforeseen by CWC,
the water in the Water Tank is, or within twenty-four (24)
hours will be, reduced below 250,000 U.S. gallons, CWC must
notify the Customer immediately it becomes aware of that fact.
2. PAYMENT
(1) From the Commencement Date until the end of the Term, the
Customer will, subject to sub-clause (6) and clause 4, pay a
price per 1,000 U.S. gallons equal to the total of the
following:-
(a) for the Required Monthly Gallonage in any calendar
month, US$8.50 subject to adjustment on 1st January,
2003 and on each January 1st thereafter in accordance
with sub-clause (2);
(b) for any volume supplied in excess of the Required
Monthly Gallonage in any calendar month, the price
charged to commercial consumers from time to time
within that part of the Licence Area in which the
Hotel is situated; and
(c) the Energy Adjustment Factor from time to time.
(2) On each 1st January commencing 1st January, 2003 the
Consumption Charge per 1,000 U.S. gallons of the Required
Monthly Gallonage in that year will be adjusted to the figure
obtained by reference to the following formula:-
5.41 X USPPIL + 3.09 X CICPIL
------------- -------------
USPPI00 CICPI00
For the purposes of this clause:-
USPPIL is the United States Producer Price Index for
Industrial Commodities at the preceding September 30th and
USPPI00 is that index at September 30, 2000, and
CICPIL is the Cayman Islands Consumer Price Index at the
preceding September 30th and CICPI00 is that index at
September 30, 2000.
BUT if the Cayman Islands Government does not produce a
Consumer Price Index at any relevant date, the United States
Government Consumer Price Index for that date and September
30, 2000 must be used.
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(3) (a) CWC must furnish, fix and maintain in good repair the
Main Meter, the Property Meter and the meters
measuring the volumes of water flowing into the
Irrigation Tank and passing through the Fire Pump for
determining the quantity of water used by the
Customer. The Customer must pay the rental specified
in paragraph (b) for the use of the Property Meter
and the meter measuring the volume of water passing
through the Fire Pump only, which will remain the
property of CWC. If any meter is damaged by the
Customer, its servants, agents or invitees, CWC will
repair or replace the meter but at the Customer's
expense. The Customer is liable for the cost of all
water passing through (i) the Property Meter and (ii)
the meters measuring the volumes of water flowing
into the Irrigation Tank and passing through the Fire
Pump, less water passing through the Main Meter
unless any meter is found to be defective after a
complaint by the Customer to CWC. CWC will charge the
Customer for water used based on the average water
consumption of the previous twelve (12) months when
the defective meter was working, pro rata for the
period when the meter was not recording correctly or
not recording at all.
(b) Meter rates are as follows:-
SIZE MONTHLY RENTAL CONNECTION FEE RECONNECTION FEE
---- -------------- -------------- ----------------
20 mm (3/4") CI$ 3.50 CI$ 80.00 CI$ 50.00
25 mm (1") CI$ 5.00 CI$120.00 CI$ 75.00
38 mm (1 1/2") CI$ 7.50 CI$175.00 CI$110.00
50 mm (2") CI$10.00 CI$240.00 CI$150.00
75 mm (3") CI$15.00 CI$360.00 CI$225.00
100 mm (4") CI$25.00 CI$560.00 CI$300.00
150 mm (6") CI$40.00 CI$800.00 CI$350.00
(4) CWC must invoice the Customer for the Monthly Charge for the
previous calendar month and any unpaid balance on the account
(including interest on any late payments at the rate set out
below) and the Customer must pay each invoice within
twenty-one (21) days failing which the Customer must pay CWC
interest at the rate of 1 1/2% per month calculated on a daily
basis from the due date to the date of payment, which CWC may
charge whether or not it continues to supply water. If any
invoice remains unpaid for 30 days from its date then CWC may
cease supplying water until the Customer pays all invoices up
to date.
(5) The water supply service must be used only by the Customer or
his tenants or guests and must not be re-sold or otherwise
supplied to third parties, either within or outside the
boundaries of the Hotel.
(6) For the period beginning on the date of this agreement and
ending on 31st May, 2002 only, for any gallonage supplied in
excess of the Required Monthly Gallonage in any calendar
month, the Customer will pay a price per 1000 U.S. gallons
equal to the price payable pursuant to subclause 2(1)(a) and
(c) in the relevant calendar month for the Required Monthly
Gallonage.
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3. SECURITY DEPOSIT
The Customer must pay CWC on the date of this Agreement, a deposit of
US$50,000.00 which CWC must hold on account of the payment of the
Monthly Charge during the last month of this Agreement. So long as the
Customer has paid all charges (including any interest on late payments)
due under this Agreement during the previous year, CWC must, on every
anniversary of the payment of the deposit, compute and credit the
Customer against the following month's ▇▇▇▇ for water under this
Agreement, interest on that deposit at the average rate paid by Cayman
National Bank during the previous year on fixed deposits of
US$50,000.00 for periods of one year. If at the end of this Agreement
any portion of the deposit remains unused, CWC must immediately refund
it to the Customer without interest.
4. MINIMUM WATER QUANTITY
(1) The Customer must pay the Consumption Charge for at least
170,000 U.S. gallons of water per day whether or not it is
used if CWC was able to supply that quantity on the particular
day. If CWC could not have supplied that quantity of water on
any day, the Customer need only pay for the quantity which
could have been supplied.
(2) Notwithstanding sub-clause (1), if in any month after May 2002
the Customer does not use the minimum water quantity for which
he has paid the Consumption Charge, CWC must give credit in
succeeding months for the Consumption Charge paid in respect
of the unused water against the Monthly Charge for water used
in those months in excess of the minimum quantity BUT except
in respect of credits earned after 31st May, 2026, which will
expire on the expiration of this Agreement, unused credits
earned in each 24 month period which commences 1st June during
the Term (the first of which will commence 1st June, 2002)
will expire at the end of each such 24 month period.
5. FORCE MAJEURE
Notwithstanding anything to the contrary in this Agreement, the
Customer's rights against CWC and any corresponding obligations of the
Customer will be suspended during any period in which CWC cannot carry
out its obligations under this Agreement because of FORCE MAJEURE which
includes, without limitation, hurricane, fire, flood or other acts of
God, accident, explosion, war, strike, lockout, labour trouble,
expropriation by Governmental authority, regulation, orders or requests
of Governmental agencies or inability by the exercise of reasonable
diligence to obtain supplies, materials or power.
6. ASSIGNMENT
(1) The Customer may not assign the benefit of this Agreement
without first obtaining CWC's consent (such consent not to be
unreasonably withheld or delayed) BUT:-
(a) may without that consent and subject to it remaining fully
liable to CWC in all respects assign this Agreement to
o any wholly owned subsidiary company or any company
which owns all of the Customer's shares; or
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o any successor to the Customer by consolidation,
merger or other corporate action; or
o the operator of the Hotel (currently the Hyatt
Regency, Grand Cayman) from time to time; or
o any purchaser of the Customer or purchaser of the
Hotel.
(b) in every case, each assignee of the Customer must assume
and will be taken to have assumed the obligations under
this Agreement and will be liable in addition to the
Customer, from the date of the assignment, to comply with
all the Customer's obligations in it.
The Customer must give notice to CWC within one month after
any transaction under this clause, supplying a copy of the
instrument.
On CWC's giving consent to any assignment and the assignee
agreeing to accept all of the Customer's obligations under
this Agreement, the Customer will be released from all those
obligations as of the date of CWC's consent, but without
prejudice to CWC's right of action in respect of any
antecedent breaches by the Customer.
(2) CWC agrees that if at any time CWC assigns or transfers the
Concession or the Concession is granted to another company in
which CWC has an interest, it will assign this Agreement to
the assignee, transferee or grantee (as the case may be) of
the Concession.
7. TERMINATION
(1) This Agreement may, without prejudice to any other rights
which the terminating party may have against the other, be
terminated by either party before the end of the Term if the
other party:-
(a) does not comply with any of its representations,
warranties or agreements set out in this Agreement and
does not remedy the breach (if capable of remedy) within
30 days of service on it of notice so to do; or
(b) is prohibited from performing its obligations under this
Agreement as a result of any applicable law or regulation.
(2) The Customer may terminate this Agreement at any time after
the Lease has been terminated by the Customer pursuant to the
termination provisions contained in the Lease.
8. NOTICES
(1) A notice or other communication under or in connection with
this Agreement shall be in writing and shall be delivered
personally or sent by telefax, as follows:-
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(a) if to CWC, to:-
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇
P.O. Box 1114
▇▇▇▇▇▇ Town, Grand Cayman B.W.I.
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:-
▇▇▇▇▇ & ▇▇▇▇▇▇▇
One ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
P.O. Box 472
▇▇▇▇▇▇ Town, Grand Cayman B.W.I.
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Customer, to:-
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ B.W.I.
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:-
▇▇▇▇▇ & ▇▇▇▇▇▇▇
P.O. Box 1994
▇▇▇▇▇▇ Town, Grand Cayman B.W.I.
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇ or 949-0673
or to another person, address or telefax number specified by a
party by written notice to the others.
(2) In the absence of evidence of earlier receipt, a notice or
other communication is deemed given:-
(a) if delivered personally, when left at the address referred
to in Clause 8(1).
(b) if sent by telefax, on completion of its transmission or,
if sent on a day which is not a working day at the
recipient's address, at 9:00 a.m. (recipient's time) on
the next succeeding working day at the recipient's
address.
9. ENTIRE AGREEMENT, BINDING EFFECT AND MODIFICATION
This Agreement is binding on the parties and their respective
successors and assigns and may be amended or modified only by a further
written agreement signed by both parties. This Agreement sets out the
entire agreement of the parties with respect to its subject matter and
supersedes all previous agreements and understandings whether oral or
written relating to it.
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10. NO WAIVER OF TERMS
Unless there is a written agreement to the contrary, no neglect,
omission or forbearance on CWC's part to take advantage of or enforce
any right or remedy arising out of any breach or non-observance of any
of the terms and conditions contained or implied in this Agreement will
be deemed to be or operate as a general waiver of that term or
condition or the right to enforce or take advantage of it in respect of
any breach or non-observance of it either original or recurring.
11. DEFINITIONS
For the purposes of this Agreement:-
(1) "the Commencement Date" means the 1st day of February, 2002.
(2) "the Concession" means the concession granted to CWC under the Law,
as amended from time to time.
(3) "the Consumption Charge" means the charge in sub-clause 2(1)(a)
subject to adjustment in accordance with sub-clause 2(2).
(4) "the Energy Adjustment Factor" means the Energy Adjustment Factor
as defined in the Concession.
(5) "the Fire Pump" means the Customer's fire pump connected to the
Water Tank.
(6) "the Hotel" means the hotel presently known as the Hyatt Regency,
the Britannia golf course, the Hyatt beach club and ▇▇▇▇▇▇▇▇▇'▇
restaurant and the Rum Point restaurant comprised in the Land
Registers referred to in the Schedule.
(7) "the Irrigation Tank" means the Customer's irrigation tank marked
as such on the Plan.
(8) "the Law" means the Water (Production and Supply) Law (1996
Revision) which expression includes any amendment, consolidation or
re-enactment of it.
(9) "the Lease" means the lease under the Registered Land Law between
the Customer as landlord and CWC as tenant of part of the land
comprised in Registration Section ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
Parcel 79REM1.
(10) "the Licence Area" means the area for which CWC has been granted
the Concession under the Law.
(11) "the Main Meter" means the water meter edged purple on the Plan
metering the supply of water to that part of the Britannia
Development known as "Britannia Villas".
(12) "the Monthly Charge" means the total of the Consumption Charge and
the Energy Adjustment Factor in respect of each month.
(13) "the Plan" means the plan attached to this Agreement marked
`Property Plan' and initialled by the parties for the purposes of
identification.
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(14) "the Property Meter" means the water meter at the boundary of the
Property to which the Water Pipe is connected, the location of
which is marked in pink on the Plan.
(15) "the Required Monthly Gallonage" means 170,000 multiplied by the
number of days in the relevant calendar month.
(16) "the Term" means the period of twenty-five (25) years or until the
earlier expiry of the Concession or any renewal of it, commencing
on the Commencement Date.
(17) "the Water Pipe" means the water pipe coloured ▇▇▇▇▇ on the Plan
running from the Property Meter to the Main Meter.
(18) "the Water Tank" means the water tank owned by CWC located on the
Property and marked as such on the Plan.
12. APPLICABLE LAW AND FORUM
This Agreement is governed by and must be construed in accordance with
the laws of the Cayman Islands and both parties submit to the
non-exclusive jurisdiction of the Cayman Islands Courts.
THE SCHEDULE
THE HOTEL
REGISTRATION SECTION BLOCK PARCEL
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West Bay Beach South 12C 27
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▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 24 & 26
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▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 79REM1
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▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 89
---------------------------------------- -------------------------------------- --------------------------------------
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 88
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▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ 94
---------------------------------------- -------------------------------------- --------------------------------------
West Bay Beach South 12C 154
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▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇ & 173
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SIGNED for and on behalf of ) CONSOLIDATED WATER CO. LTD.
CONSOLIDATED WATER CO. LTD. by )
)
a Director, in the presence of:- )
Per: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
) --------------------------
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ) Director
-----------------------------------
Witness
SIGNED on behalf of CAYMAN ) CAYMAN HOTEL & GOLF INC.
HOTEL & GOLF INC. by )
▇▇▇▇▇ ▇▇▇▇▇ , a Director, )
and by ▇▇▇▇▇ ▇▇▇▇▇▇ , a Director ) Per: /s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------
the presence of:- ▇▇▇▇▇▇▇ ▇▇▇▇▇ ) Director
)
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ) Per: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------- ---------------------------
Witness Director
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