______________________________________________________________________________
______________________________________________________________________________
EXHIBIT 4.15
California Petroleum Transport Corporation
and
CalPetro Tankers (Bahamas I) Limited
___________________________________
ISSUE OF ONE DEBENTURE
Dated ________ __, 1994
___________________________________
______________________________________________________________________________
______________________________________________________________________________
Table of Contents
Page No.
ARTICLE I
DEFINITIONS................................ 1
ARTICLE II
COVENANT TO PAY............................... 1
Section 2.1. Covenant to Pay......................................... 1
ARTICLE III
MORTGAGE, CHARGE AND ASSIGNMENT....................... 2
Section 3.1. Charge.................................................. 2
Section 3.2. Legal Securities........................................ 3
Section 3.3. Conversion of Floating Charge........................... 3
Section 3.4. Negative Pledge......................................... 3
Section 3.5. New Accounts............................................ 3
ARTICLE IV
PRESERVATION OF SECURITY........................... 3
Section 4.1. Continuing Security..................................... 3
Section 4.2. Waiver of Defenses...................................... 4
Section 4.3. Immediate Recourse...................................... 4
Section 4.4. Preservation of Rights.................................. 4
Section 4.5. Additional Security..................................... 5
Section 4.6. Certificate............................................. 5
Section 4.7. Discharge............................................... 5
Section 4.8. Registration............................................ 5
Section 4.9. Lender's Powers With Respect to Security Assets......... 5
Section 4.10. Calls................................................... 5
Section 4.11. Delegation By Lender.................................... 6
Section 4.12. Further Assurances...................................... 6
Section 4.13. Redemption of Prior Mortgages........................... 6
Section 4.14. Power of Attorney....................................... 6
Section 4.15. Avoidance of Payments................................... 7
Section 4.16. Powers to Lend.......................................... 7
ARTICLE V
DEALINGS WITH SECURITY ASSETS......................... 7
Section 5.1. Day to Day Business..................................... 7
Section 5.2. Charged Accounts........................................ 8
Section 5.3. Deposit of Proprietary Rights........................... 8
Section 5.4. Liability to Perform.................................... 8
ARTICLE VI
ENFORCEMENT.................................. 8
Section 6.1. When Security Becomes Enforceable....................... 8
Section 6.2. Enforcement of Security................................. 9
Section 6.3. Remedies, Waivers and Consents.......................... 9
ARTICLE VII
RECEIVER................................. 9
Section 7.1. Appointment and Powers of Receiver...................... 9
Section 7.2. Comply with Instructions................................ 11
Section 7.3. Removal and Remuneration................................ 12
Section 7.4. Lender May Exercise Receiver's Powers................... 12
Section 7.5. No Liability As Mortgagee In Possession................. 12
Section 7.6. Protection Of Third Parties............................. 12
Section 7.7. Expenses................................................ 12
Section 7.8. Indemnity............................................... 13
ARTICLE VIII
APPLICATION OF PROCEEDS............................ 13
Section 8.1. Order of Application.................................... 13
Section 8.2. Suspense Accounts....................................... 13
ARTICLE IX
MISCELLANEOUS PROVISIONS............................ 13
Section 9.01. Amendment.............................................. 13
Section 9.02. Severability........................................... 14
Section 9.03. Notices................................................ 14
Section 9.04. Consent to Jurisdiction................................ 14
Section 9.05. Captions............................................... 14
Section 9.06. Governing Law.......................................... 14
Section 9.07. No Partnership......................................... 14
Section 9.08. Counterparts........................................... 15
Section 9.09. Survival............................................... 15
Section 9.10. Integration............................................ 15
Section 9.11. Reproduction of Documents.............................. 15
Section 9.12. Successors and Assigns; Assignment..................... 15
Section 9.13. General Interpretive Principles........................ 15
This Issue of One Debenture, dated ________ __, 1994 (the
"Debenture"), from CalPetro Tankers (Bahamas I) Limited, a company organized
under the laws of The Commonwealth of the Bahamas (the "Owner") to California
Petroleum Transport Corporation, a corporation organized under the laws of the
State of Delaware (the "Lender") is issued pursuant to Clause __ of the
Memorandum of Association and Article 32 of the Articles of Association of
the Owner passed at the meeting of the Directors held on the __ day of
_________, 1994.
PRELIMINARY STATEMENT
The Owner has requested that the Lender make two loans to the
Owner: one in the aggregate principal amount equal to $____________ (the "Term
Loan") and one in the aggregate principal amount equal to $____________ (the
"Serial Loan" and, collectively with the Term Loan, the "Loans"). The Loans
will be made pursuant to the terms and conditions of two Loan Agreements, each
dated as of the date hereof, each between the Lender and the Owner. The net
proceeds of the Serial Loan and the Term Loan will be used by the Owner to
acquire the m.t. _________ (the "Vessel") from Chevron Transport Corporation
(the "Initial Charterer"). The Vessel will be bareboat chartered to the
Initial Charterer pursuant to the Bareboat Charter (the "Initial Charter"),
dated as of the date hereof, between the Owner and the Initial Charterer. As
collateral security for its obligations under the Loan Agreements, the Owner
will assign, pledge, mortgage and grant the Lender a security interest in,
inter alia, the Vessel, the Initial Charter, the earnings and insurances of
the Vessel and will grant this debenture in favor of the Lender.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and of other valuable consideration, receipt of
which is hereby acknowledged, the Owner and the Lender hereby agree as follows:
ARTICLE I
DEFINITIONS
Capitalized terms used in this Debenture shall have the meanings
assigned to such terms in Schedule 1 to this Debenture, and the definitions of
such terms shall be equally applicable to both the singular and plural forms
of such terms.
ARTICLE II
COVENANT TO PAY
Section 2.1. Covenant to Pay. The Owner hereby covenants and
agrees to pay and discharge each sum owing under the Term Obligations and the
Serial Obligations as and when the same shall fall due, whether at maturity,
by acceleration or otherwise.
ARTICLE III
MORTGAGE, CHARGE AND ASSIGNMENT
Section 3.1. Charge. As continuing security for the Term
Obligations and the Serial Obligations, equally and ratably, the Owner hereby:
(a) conveys, transfers and assigns absolutely to and unto the Lender
all rights of the Owner in and to the Current Receivables by way
of fixed security;
(b) mortgages, charges and assigns, and agrees to mortgage, charge and
assign to the Lender all present and future rights of the Owner in
and to all freehold or leasehold property of the Owner and all
other estates or interests therein together with all trade
fixtures and fixed plant and machinery now and for the time being
thereon, by way of a fixed charge;
(c) mortgages, charges and assigns, and agrees to mortgage, charge and
assign, to the Lender all rights now owned or hereafter acquired
in and to the goodwill, franchises, patent rights, copyrights,
trademarks and other intangible Assets of the Owner by way of
filed charge;
(d) mortgages, charges and assigns, and agrees to mortgage, charge and
assign, to the Lender all rights relating to the aforesaid
property specified in Sections 3.1(a), (b) and (c) including,
inter alia, negotiable instruments, legal and equitable charges,
reservations of property rights, rights of action, collection,
recovery or security, rights of tracing and unpaid vendor's liens
and similar and associated rights, by way of fixed legal mortgage
and charge; and
(e) mortgages and charges in favor of the Lender all rights of the
Owner now owned or hereafter acquired in and to all other Assets
for the time being of the Owner not subject to the fixed
securities created by Sections 3.1(a), (b), (c) and (d)
wheresoever situate (including, inter alia, all undertakings and
businesses of the Owner) by way of a floating charge and the Owner
shall not be at liberty to create any mortgage or charge on any of
the securities created by this Section 3.1(e) and no lien shall in
any case or in any manner arise on or affect any part of the said
securities in priority to or pari passu with all charges hereby
created, it being the intention that the Owner shall have no
power, without the written consent of the Lender, to part with or
dispose of any part of the said securities except by way of sale
in the ordinary course of its business;
provided, however, that upon the unconditional payment and satisfaction
of the Serial Obligations, the rights of the Lender hereunder will
secure solely and exclusively the Term Obligations;
provided further, that upon the unconditional payment and satisfaction
of the Term Obligations the rights of the Lender hereunder will
terminate and the Lender will at the direction, cost and expense of the
Owner release or reassign to the Owner all remaining rights of the
Lender in and to the balance of the Security Assets.
Section 3.2. Legal Securities. The Owner will forthwith at the
request of the Lender execute a legal mortgage, charge or assignment over all
or any of the Security Assets subject to or intended to be subject to any
fixed security hereby created in favor of the Lender in such form as the
Lender may reasonably require.
Section 3.3. Conversion of Floating Charge. The Lender may at any
time by notice to the Owner convert the floating charges hereby created into a
specific charge as regards any Assets specified in the notice which the Lender
shall consider to be in danger of being seized or sold under any form of
distress, attachment, execution or other legal process or to be otherwise in
jeopardy and (whether or not this security has become enforceable) may at any
time appoint a Receiver (as defined in Section 7.1 hereof) thereof.
Section 3.4. Negative Pledge. The Owner shall not, without the
prior written consent of the Lender, permit the sale, transfer, assignment
lease or other disposition of any Security Asset, or any Encumbrance or other
right in or over any Security Asset to subsist, arise or be created, other
than such Encumbrance as is created by this Debenture.
Section 3.5. New Accounts. If the Lender receives or is deemed to
be affected by notice whether actual or constructive of any subsequent
Encumbrance or other interest affecting any Security Asset or the proceeds of
sale thereof, the Lender may open a new account or accounts for the Owner. If
the Lender does not open a new account it shall nevertheless be treated as if
it had done so at the time when it received or was deemed to have received
notice and as from that time all payments made to the Lender shall be credited
or be treated as having been credited to the new account and shall not operate
to reduce the amount for which this Debenture is security.
ARTICLE IV
PRESERVATION OF SECURITY
Section 4.1. Continuing Security. The security constituted by this
Debenture shall be a continuing security and shall not be satisfied by any
intermediate payment or satisfaction of the Term Obligations and the Serial
Obligations but shall secure the ultimate balance of the Term Obligations and
the Serial Obligations; provided, however, that, in the event that the Serial
Obligations are satisfied and paid in full pursuant to the terms and
conditions of the Serial Loan Agreement, this Assignment will be security
solely and exclusively for the Term Obligations. The security hereby given
shall be in addition to and shall not be discharged, released, prejudiced or
otherwise affected by any other security or Encumbrance now or hereafter held
by the Lender for the Term Obligations or the Serial Obligations.
Section 4.2. Waiver of Defenses. The obligations of the Owner
under this Debenture and this security shall not be discharged, released,
prejudiced or otherwise affected by any act, omission or circumstance which
but for this provision might so operate or otherwise release or discharge the
Owner from the Term Obligations or the Serial Obligations, or the security
created under this Debenture including without limitation and whether or not
known to or discoverable by the Owner or the Lender:
(a) any time, indulgence, waiver, consent or other relief granted to
or composition with the Owner or any other Person;
(b) the taking, variation, extension, compromise, renewal or release
of, or refusal or neglect to perfect or enforce, any rights under
the Term Loan Agreement, the Serial Loan Agreement, this
Debenture, any Security Document or any other guarantee, agreement
or obligation or any right against, or any security granted by,
the Owner or any other Person;
(c) any irregularity, invalidity or unenforceability of any obligation
of the Owner under the Term Loan Agreement, the Serial Loan
Agreement, any Security Document, this Debenture or any other
guarantee, of any government or authority (whether of right or in
fact) purporting to reduce or otherwise affect any such obligation
to the intent that such obligation and this security shall remain
in full force and this Debenture shall be construed accordingly as
if there were no such irregularity, unenforceability, invalidity,
law or order;
(d) any legal limitation, disability, incapacity or other circumstance
relating to the Owner, any guarantor or any other Person;
(e) any defect in or invalidity or inadequacy of the constitution or
incorporation or borrowing powers of the Owner or of its board of
directors, executive committee or other equivalent of analogous
body or in the authorization, execution or delivery of the Term
Loan Agreement, the Serial Loan Agreement, any Security Document,
this Debenture or any other guarantee, agreement or obligation; or
(f) any supplement, amendment or modification to the terms of the Term
Loan Agreement, the Serial Loan Agreement, this Debenture, any
other Security Document or any other guarantee, agreement or
obligation.
Section 4.3. Immediate Recourse. The Owner waives any right it may
have of first requiring the Lender to proceed against or claim payment from
the Owner or enforce the Term Loan Agreement, the Serial Loan Agreement, any
Security Documents or other guarantee, agreement or obligation before
enforcing this Debenture.
Section 4.4. Preservation of Rights. Until the Term Obligations
and the Serial Obligations have been irrevocably paid and discharged in full,
the Lender may:
(a) refrain from applying or enforcing any other security, money or
right held or received by the Lender in respect of the Term
Obligations or the Serial Obligations or apply and enforce the
same in such manner and order as the Lender sees fit; and
(b) hold in a suspense account (without liability to pay interest
thereon) any moneys received or on account of this Debenture by
way of a partial payment.
Section 4.5. Additional Security. This Debenture shall be in
addition to and shall not in any way be prejudiced by any other security now
or hereafter held by the Lender.
Section 4.6. Certificate. A certificate of the Lender setting
forth the amount due from the Owner in respect of the Term Obligations and/or
the Serial Obligations shall, in the absence of manifest error, be prima facie
evidence of such amount.
Section 4.7. Discharge. Where any discharge (whether in respect of
the Term Loan Agreement, the Term Obligations, the Serial Loan Agreement, the
Serial Obligations, this Debenture, or any other guarantee, agreement,
obligation or security or otherwise) is made in whole or in part or any
arrangement is made on the faith of any payment, security or other disposition
which is avoided or must be repaid on bankruptcy, liquidation, winding-up,
dissolution or otherwise, this security and the obligations of the Owner under
this Debenture shall continue as if there had been no such discharge or
arrangement.
Section 4.8. Registration. The Owner hereby agrees to arrange for
this Debenture, any Security Asset or any agreement, document or instrument
relating thereto to be registered with or notified to any Person to preserve
or perfect the Lender's security in any Security Asset.
Section 4.9. Lender's Powers With Respect to Security Assets. The
Lender may without demand or notice to the Owner being required at any time
after this security becomes enforceable exercise at its discretion (in the
name of the Owner or otherwise) and without any further consent or authority
by the Owner, any right which may be exercised by the Person in whose name any
Security Asset is registered or who is the holder thereof under the terms
thereof or otherwise including, but without limitation, all the powers given
to trustees by statute in respect of securities or property subject to a
trust; provided, however, that until the security hereby constituted becomes
enforceable, the Lender shall procure that the rights attached to each such
Security Asset are exercised in such manner as the Owner shall direct so long
as the same is not inconsistent with any term of the Term Loan Agreement, the
Serial Loan Agreement or this Debenture and account to the Owner for any sum
or other distribution paid in respect of such Security Asset.
Section 4.10. Calls. The Owner will for so long as the Term
Obligations and the Serial Obligations remain outstanding pay all sums which
may become due in respect of the Security Assets and in the event of default
the Lender may if it thinks fit make such payments on behalf of the Owner.
Any sums so paid by the Lender shall be immediately due and payable by the
Owner to the Lender without demand or notice being required.
Section 4.11. Delegation By Lender. The Lender may at any time and
from time to time delegate by power of attorney or in any other manner to any
Person or Persons all or any of the rights and discretions which are for the
time being exercisable by the Lender under this Debenture in relation to any
Security Asset. Any such delegation may be made upon such terms (including
power to sub-delegate) and subject to such regulations as the Lender may think
fit. The Lender shall not be in any way liable or responsible to the Owner for
any loss or damage arising from any act, default, omission or misconduct on
the part of any such delegate or sub-delegate.
Section 4.12. Further Assurances. The Owner shall at its own
expense execute and deliver all such agreements, documents and instruments and
do all such assurances, acts and things as the Lender may require for
perfecting or protecting this security over any Security Asset or for
facilitating the realization of such property and in the exercise of all
rights vested in the Lender or in any sub-delegate as aforesaid. The Owner
shall in particular execute all transfers, conveyances, assignments and
assurances of such property whether to the Lender or its nominees and give all
notices, orders and directions which the Lender may think expedient and, for
the purposes of this Section, a certificate in writing by the Lender to the
effect that any particular assurance, act or thing required by it is
reasonably required shall be conclusive evidence of such fact in favor of all
third parties.
Section 4.13. Redemption of Prior Mortgages. The Lender may at any
time after the security hereby constituted has become enforceable redeem any
prior Encumbrance against any Security Asset or procure the transfer thereof
to itself and may settle and pass the accounts of the prior Encumbrances. Any
accounts so settled and passed shall be conclusive and binding on the Owner.
All principal moneys, interest, costs, charges and expenses of and incidental
to such redemption and transfer shall be immediately due by the Owner to the
Lender without notice or demand being required.
Section 4.14. Power of Attorney. (a) The Owner hereby by way of
security irrevocably nominates, constitutes and appoints the Lender and every
Receiver of any Security Asset appointed hereunder and every such delegate or
sub-delegate as aforesaid, each of them acting alone or jointly with any other
of them, to be its attorney (the "Attorney") and on its behalf and in its name
or otherwise to sign under seal or otherwise and deliver all such agreements,
documents and instruments and do all such assurances, acts and things which the
Owner ought to do but fails to do under the covenants and provisions contained
in the Indenture or this Debenture (including without prejudice to the
generality of the foregoing to make any demand upon or give any notice or
receipt to any Person owing moneys to the Owner and to execute and deliver any
charges, legal and equitable generally in its name and on its behalf to
exercise all or any of the rights conferred by or pursuant to this Debenture
or by statute on the Attorney and (without prejudice to the generality of the
foregoing) to sign under seal or otherwise and deliver and otherwise perfect
any assurance, agreement, instrument or act which the Attorney may deem proper
in or for the purpose of exercising any of such rights.
(b) The Owner hereby ratifies and confirms and agrees to ratify
and confirm any such Attorney described in Section 4.14(a).
Section 4.15. Avoidance of Payments. No assurance, security or
payment which may be avoided under any enactment relating to bankruptcy, and
no release, settlement or discharge given or made by the Lender on the faith
of any such assurance, security or payment, shall prejudice or affect the
right of the Lender to enforce the security created by or pursuant to this
Debenture in respect of the full extent of the moneys thereby secured. The
Lender shall be at liberty at its absolute discretion to retain the security
so created as security for the Term Obligations and Serial Obligations,
equally and ratably, for a period of seven months in the case of fixed
security and thirteen months in the case of floating security after the Term
Obligations and Serial Obligations shall have been paid in full,
notwithstanding any release, settlement, discharge or arrangement given or
made by the Lender on or as a consequence of, such termination of liability.
If at any time within the period of six months in the case of fixed security
and twelve months in the case of floating security after such termination a
petition shall be presented to a competent court for an order for the winding
up of the Owner or the Owner shall commence to be wound up voluntarily, the
Lender shall be at liberty, notwithstanding as aforementioned, to continue to
retain such security or any part thereof for and during such further period as
the Lender in its absolute discretion shall determine. The Owner agrees that
such security shall be deemed to have been and to have remained held by the
Lender as and by way of security for the payment to the Lender of all or any
sums which are now or may become due and owing to the Lender under the Term
Loan Agreement, the Serial Loan Agreement and the rest of the Security
Documents.
Section 4.16. Powers to Lend. The Lender may advance money on the
security of any Security Asset for the purpose of defraying any costs,
charges, losses and expenses which shall be paid or incurred by it in relation
to this Debenture (including the remuneration of any Receiver) or which the
Lender anticipates may be paid or incurred in the exercise of the rights
vested in it or for all other purposes of this Debenture or any of them and
the Lender may advance such moneys at such rates of interest and generally on
such terms and conditions as it shall think fit.
ARTICLE V
DEALINGS WITH SECURITY ASSETS
Section 5.1. Day to Day Business. For so long as the security
hereby constituted shall not have become enforceable, the Owner may in the
ordinary course of trading (a) for the purpose of getting in and realizing any
Current Receivable compromise, settle, release or otherwise dispose any
thereof, including any Encumbrance or other security relating thereto, save
that nothing in this Section 5.1 shall be construed so as to permit the Owner
to sell, factor or discount any Current Receivable and, (b) acquire, deal in
and dispose of any Security Asset specified in Section 3.1(b) other than
pursuant to the applicable terms of the Term Loan Agreement and the Serial
Loan Agreement.
Section 5.2. Charged Accounts. The Owner shall cause all sums
hereafter received or recovered by or for it in respect of any Current
Receivable to be directly credited to a separate and distinct account as the
Lender may from time to time designate and, if called upon to do so by notice
in writing from the Lender, shall execute an absolute assignment of any such
Current Receivable in favor of the Lender, all at the cost of the Owner. Until
the security hereby constituted is fully discharged in accordance with the
terms hereof, the Owner shall not be entitled to withdraw any sum standing to
the credit of any such account established as aforesaid without the prior
written consent of the Lender.
Section 5.3. Deposit of Proprietary Rights. The Owner shall, if
the Lender so requires, deposit with the Lender all certificates and other
documents of title or evidence of ownership in relation to the patents and
rights referred to in Section 3.1(c).
Section 5.4. Liability to Perform. Notwithstanding any other
provision herein contained to the contrary, the Owner shall remain liable to
observe and perform all of the respective conditions and obligations assumed
by it in respect of each Security Asset and the Lender shall be under no
obligation by reason of this Debenture, nor shall the Lender be required in
any manner, to perform or fulfil any obligation of the Owner in respect of any
Security Asset or to make any payment or make any enquiry as to the maturity,
amount, nature or sufficiency of any rental, interest, proceeds, payments or
receipts received by it or them or the Owner or to present or file any claim
or take any other action or give any notice to collect, exercise or enforce
the payment of any amount or the taking up of any rights or property to which
the Owner may have been or to which it may be now or hereafter entitled
thereunder at any time.
ARTICLE VI
ENFORCEMENT
Section 6.1. When Security Becomes Enforceable. The security
hereby conferred shall become immediately enforceable and the floating charge
created by this Debenture shall be deemed to have crystallized and the power
of sale and other powers conferred by statute as varied or amended by this
Debenture shall be immediately exercisable (i) if the Owner fails to meet the
Term Obligations and the Serial Obligations in the manner specified in Section
2.1 or (ii) upon and after the occurrence of any Event of Default as defined
in the Term Loan Agreement or the Serial Loan Agreement. After this security
has become enforceable, the Lender may in its discretion enforce all or any
part of this security, and exercise all or any rights of enforcement hereby
granted, in such manner as the Lender sees fit.
Section 6.2. Enforcement of Security. For the purposes of all
powers implied by statute the Term Obligations and the Serial Obligations
shall be deemed to have become due and payable on the date hereof and any
statutory restrictions on the power of sale and restrictions on the right of
consolidation shall not apply to this security.
Section 6.3. Remedies, Waivers and Consents. No delay or omission
of the Lender in exercising any right under this Debenture shall impair or be
construed as a waiver of such right nor shall any single or partial exercise
of any such right preclude any further exercise thereof or the exercise of any
other right. The rights provided in this Debenture are cumulative and not
exclusive of any rights provided by law, agreement or otherwise. Any waiver
and any consent by the Lender under this Debenture must be in writing and may
be given subject to any conditions thought fit by the Lender. Any waiver or
consent shall be effective only in the instance and for the purpose for which
it is given.
ARTICLE VII
RECEIVER
Section 7.1. Appointment and Powers of Receiver. At any time after
this security becomes enforceable the Lender may without further notice
appoint in writing under its hand any one or more Person(s) to be a receiver
or receiver and manager (hereinafter each called "a Receiver") as the Lender
at its sole discretion may see fit of any Security Asset in like manner in
every respect as if the Lender had become entitled under statute to exercise
the power of sale thereby conferred. Every Receiver so appointed shall, in
addition to any powers conferred by statute or common law, have and be
entitled to exercise all rights to do any or all of the following things:
(a) Take Possession. Enter upon and take immediate possession of, get
in and collect any Security Asset and undertake any works of
demolition, building, reconstruction, repair or decoration thereon;
(b) Sell Assets. Subject to any necessary consent or approval of any
judicial, administrative, governmental or other regulatory body,
office or agency, sell, convert into money and realize any
Security Asset by public auction or private contract, dispose of,
grant options and other rights in respect of and exercise all
other rights conferred on an owner under any statute, at common
law or otherwise, in respect of any Security Asset and generally
in such manner and on such terms (which may consist wholly or
partly of shares or securities of any company or body corporate)
as the Receiver shall think fit and transfer, convey, assign or
grant an assurance of the same in the name and on behalf of the
Owner. Without prejudice to the generality of the foregoing, the
Receiver may do any of these things for a consideration consisting
of cash, debentures or other obligations, shares or other valuable
consideration in cash or in any other form whatsoever and any such
consideration may be payable in a lump sum or by installments
spread over such period as the Receiver may think fit;
(c) Compromise. Settle, adjust, refer to arbitration, compromise and
arrange any claims, accounts, disputes, questions and demands with
or by any Person who is or claims to be a creditor of the Owner or
relating in any way to any Security Asset;
(d) Borrow and Create Security. Borrow or raise money and secure the
repayment thereof and interest thereon by mortgaging,
sub-mortgaging or otherwise charging any Security Asset or this
Debenture (whether or not in priority to the sums and obligations
secured by this Debenture) in such manner and on such terms as the
Receiver shall think fit; provided, however, that:
(i) no Receiver shall exercise such right without first
obtaining the written consent of the Person appointing him
and the Lender shall not incur any responsibility to the
Owner or any other Person by reason of giving or refusing
its consent, whether directly or subject to any limitation or
condition; and
(ii) no Person lending such money shall be concerned to enquire
as to the existence of such consent or the terms thereof or
as to the propriety or purpose of the exercise thereof or to
see to the application of any money so borrowed or raised;
(e) Employ Agents. Employ solicitors, managers, agents and others as
the Receiver shall deem necessary;
(f) Receipts. Give valid receipts and discharges for all moneys and
claims and execute all assurances and things which may be proper
or desirable for realizing any Security Assets;
(g) Consideration. Receive or pay any consideration in cash or other
valuable consideration and so that the same may be receivable or
payable either immediately or at a later time and in a lump sum or
by installments spread over such period as the Receiver shall
think fit;
(h) Dealings. Generally to deal with and effect any transaction or
arrangement of any kind whatsoever in respect of any Security
Asset;
(i) Legal Proceedings. Settle, arrange, compromise and submit to
arbitration any accounts, claims, questions or disputes whatsoever
which may arise in connection with any Security Asset or in any
way relating to the security constituted by this Debenture, to
bring, take, defend, compromise, submit to and discontinue any
actions, suits, arbitration or proceedings whatsoever whether
civil or criminal in relation to the matters aforesaid, to enter
into, complete, disclaim, abandon or disregard, determine or
rectify all or any of the outstanding agreements or arrangements
of the Owner in any way relating to or affecting the Security
Assets or any part thereof and to allow time for payment of any
debts either with or without security as the Receiver shall think
expedient;
(j) In Owner's Name. Generally at his option to use the name of the
Owner in the exercise of all or any of the rights hereby conferred;
(k) Exercise of Rights. Exercise, or permit the Owner or any nominee
of the Owner to exercise, any rights incident to the ownership of
any Security Asset in such manner as the Receiver may think fit
and in particular (as regards shares, stock and securities) any
voting rights conferred by the same and (as regards securities)
any rights of enforcing the same by foreclosure, sale or otherwise;
(l) Corporate Transfers. Transfer any Security Asset to any other
company or body corporate, whether or not formed or acquired for
the purpose;
(m) Carry on Business. Generally manage and carry on and conduct any
of the undertakings and businesses of the Owner;
(n) Calls. Make calls, conditionally or unconditionally, on the
members of the Owner in respect of all or any part of its uncalled
capital with such and the same rights of enforcement as are
conferred by the Memorandum of Association and Articles of
Association of the Owner upon its directors in this respect;
(o) General Powers. Sign under seal or otherwise and deliver all such
agreements, documents and instruments and do all such other acts
and things as the Receiver may consider desirable or necessary for
realizing any Security Asset or incidental or conducive to any of
the matters or rights conferred on a Receiver under or by virtue
of this Debenture and to exercise in relation to any Security
Asset all such rights as the Receiver should be capable of
exercising if the Receiver were the beneficial owner of the same;
and
(p) Moneys received by Receiver. All moneys received by a Receiver
shall after providing for the matters specified by any law be
applied by him in or towards satisfaction of this Debenture and
thereafter of any other incumbrance of which he shall have notice
and thereafter the Receiver shall pay the residue of the moneys
received by him to the Owner.
Section 7.2. Comply with Instructions. Any Receiver shall in the
exercise of the Receiver's rights conform to any regulations and directions
from time to time made and given by the Person appointing him but so that no
Person dealing with the Lender or any Receiver shall be concerned to enquire
whether the Receiver has so conformed to any such regulations or directions.
Section 7.3. Removal and Remuneration. The Lender may from time to
time by writing under its hand remove any Receiver appointed by it and may
whenever it may deem it expedient appoint a new Receiver in the place of any
Receiver whose appointment may for any reason have terminated and may from
time to time fix the remuneration of any Receiver appointed by it.
Section 7.4. Lender May Exercise Receiver's Powers. All or any of
the rights which are conferred by this Debenture (either expressly or
impliedly) upon a Receiver of any Security Asset may be exercised after the
security hereby created becomes enforceable by the Lender in relation to any
Security Asset without first appointing a Receiver of the same or
notwithstanding the appointment of a Receiver of the same.
Section 7.5. No Liability As Mortgagee In Possession. The Lender
shall not nor shall any Receiver appointed as aforesaid by reason of the
Lender or the Receiver entering into possession of any Security Asset be
liable to account as mortgagee in possession or be liable for any loss or
realization or for any default or omission for which a mortgagee in possession
might be liable. Every Receiver duly appointed by the Lender shall be deemed
to be the agent of the Owner for all purposes and shall as such agent be
deemed to be in the same position as a Receiver duly appointed by a mortgagee
under statute. The Owner alone shall be responsible for its agreements,
obligations, acts, omissions, defaults and losses and the Lender shall not
incur any responsibility therefor (either to the Owner or to any other Person
whatsoever) by reason of appointing such Receiver or for any other reason
whatsoever. Every such Receiver and the Lender shall be entitled to all the
rights, privileges and immunities by statute conferred on mortgagees and
receivers when such receivers have been duly appointed.
Section 7.6. Protection Of Third Parties. No purchaser, mortgagee
or other Person dealing with the Lender or the Receiver or the agents of the
Lender or the Receiver shall be concerned to enquire whether any of the Term
Obligations or Serial Obligations are due or owing, the right which the Lender
or the Receiver is purporting to exercise has become exercisable or any money
remains due under this Debenture, as to the propriety or regularity of the
actions of the Lender or such Receiver, or to see to the application of any
money paid to the Lender or to such Receiver.
Section 7.7. Expenses. All costs, charges and expenses incurred
and all payments made by the Lender or any Receiver appointed hereunder in the
exercise in good faith of any right hereby conferred whether or not occasioned
by any act, neglect or default of the Lender or such Receiver shall bear
interest from the date of the same being incurred or becoming due at the
Default Rate. The amount of all such costs, charges, expenses and payments and
all interest thereon and all remuneration payable hereunder shall be payable
by the Owner on demand. All such costs, charges, expenses and payments shall
be paid and charged as between the Lender and the Owner on the basis of a full
indemnity and not on the basis of party and party or any other kind of
taxation.
Section 7.8. Indemnity. Each of the Lender and every Receiver,
attorney, manager, agent or other Person appointed by the Lender hereunder
shall be entitled to be indemnified out of the Security Assets in respect of
all obligations, costs, charges and expenses incurred and payments made by
such Person in good faith in the execution or purported execution of any right
vested in such Person pursuant hereto and against all actions, proceedings,
obligations, costs, claims and demands in respect of any matter or thing done
or omitted in any way relating to any Security Asset and the Lender and any
such Receiver may retain and pay all sums in respect of the same out of any
moneys received under the rights hereby conferred.
ARTICLE VIII
APPLICATION OF PROCEEDS
Section 8.1. Order of Application. Any moneys received by the
Lender pursuant to this Debenture or under the powers hereby conferred shall
after the security hereby constituted shall have become enforceable but
subject to the payment of any claims having priority to this security be
applied for the following purposes and in the following order of priority (but
without prejudice to the right of the Lender to recover any shortfall from the
Owner):
(a) in satisfaction of or provision for all costs, charges and
expenses incurred and payments made by the Lender or any Receiver
appointed hereunder and of all remuneration due hereunder with
interest on such costs, charges, expenses and payments at the
Default Rate;
(b) in or towards payment of interest on the Term Obligations and
Serial Obligations, pro rata, in accordance with their respective
outstanding balances;
(c) in or towards payment of principal on the Term Obligations and
Serial Obligations, pro rata, in accordance with their respective
outstanding balances;
(d) in payment of the surplus (if any) to the Owner or other Person
entitled thereto.
Section 8.2. Suspense Accounts. Any moneys received under the
rights hereby conferred may, at the discretion of the Lender, be placed in a
suspense account and kept there for so long as the Lender thinks fit.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment. This Debenture may be amended from time
to time by written agreement signed by the parties hereto.
Section 9.02. Severability. If any provision of this Debenture is
held to be in conflict with any applicable statute or rule of law or is
otherwise held to be unenforceable for any reason whatsoever, such
circumstances shall not have the effect of rendering the provision in question
inoperative or unenforceable in any other case or circumstance, or of
rendering any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatsoever. The invalidity of any
one or more phrases, sentences, clauses or Sections of this Debenture
contained, shall not affect the remaining portions of this Debenture, or any
part thereof.
Section 9.03. Notices. All demands, notices and communications
hereunder shall be in writing, personally delivered or mailed by certified
mail-return receipt requested, and shall be deemed to have been duly given
upon receipt (a) in the case of the Lender, at the following address: c/o JH
Management Corporation, Room 6/9, One International Place, Boston,
Massachusetts 02110-2624, (b) in the case of the Owner, at the following
address: United House, 14-16 Nelson Street, Douglas, Isle of Man, or at other
such address as shall be designated by such party in a written notice to the
other parties.
Section 9.04. Consent to Jurisdiction. Any legal suit, action or
proceeding against the Owner arising out of or relating to this Debenture, or
any transaction contemplated hereby, may be instituted in any federal or state
court in The City of New York, State of New York and the Owner hereby waives
any objection which it may now or hereafter have to the laying of revenue of
any such suit, action or proceeding, and the Owner hereby irrevocably submits
to the jurisdiction of any such court in any such suit, action or proceeding.
The Owner hereby irrevocably appoints and designates CT Corporation System,
having an address at 1633 Broadway, New York, New York, its true and lawful
attorney-in-fact and duly authorized agent for the limited purpose of
accepting servicing of legal process and the Owner agrees that service of
process upon such party shall constitute personal service of such process on
such Person. The Owner shall maintain the designation and appointment of such
authorized agent until all amounts payable under this Debenture shall have
been paid in full. If such agent shall cease to so act, the Owner shall
immediately designate and appoint another such agent satisfactory to the Lender
and shall promptly deliver to the Lender evidence in writing of such other
agent's acceptance of such appointment.
Section 9.05. Captions. The captions or headings in this Debenture
are for convenience only and in no way define, limit or describe the scope or
intent of any provisions or sections of this Debenture.
Section 9.06. Governing Law. This Debenture shall be governed by
and interpreted in accordance with the laws of the [Commonwealth of the
Bahamas] [Isle of Man], without giving effect to the principles of conflicts
of law.
Section 9.07. No Partnership. Nothing herein contained shall be
deemed or construed to create a partnership or joint venture among the parties
hereto and the services of each party shall be rendered as an independent
contractor and not as agent for any other party.
Section 9.08. Counterparts. This Debenture may be executed in any
number of counterparts and by different parties hereto on separate
counterpart, each of which shall be deemed to be an original. Such
counterparts shall constitute one and the same agreement.
Section 9.09. Survival. The representations, covenants and
agreements contained in or made pursuant to this Debenture in respect of
either party hereto shall survive the execution and delivery of this Debenture
and shall continue in effect so long as such party's obligations hereunder
remain outstanding.
Section 9.10. Integration. This Debenture and the Schedule and
Exhibits hereto constitute the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements, understandings or representations pertaining to the subject
matter hereof, whether oral or written. There are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth or incorporated herein.
Section 9.11. Reproduction of Documents. This Debenture and all
documents relating thereto, including, without limitation, (a) consents,
waivers and modifications which may hereafter be executed, (b) documents
received by any party at the closing, and (c) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course
of business) and that any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence.
Section 9.12. Successors and Assigns; Assignment. This Debenture
shall be binding upon and inure to the benefit of the Owner and the Lender and
their respective successors and assigns. The Owner shall not have the right
to assign its rights hereunder or any interest herein without the prior
written consent of the Lender. The Lender, at its sole option, shall have the
right to assign this Debenture, the Serial Loan Agreement, the Term Loan
Agreement, the Security Documents and any of its rights and interest hereunder
and thereunder.
Section 9.13. General Interpretive Principles. For purposes of
this Debenture except as otherwise expressly provided or unless the context
otherwise requires:
(a) the defined terms in this Debenture shall include the plural
as well as the singular, and the use of any gender herein shall be deemed to
include any other gender;
(b) accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles as in effect on the date hereof;
(c) references herein to "Articles", "Sections", "Subsections",
"paragraphs", and other subdivisions without reference to a document are to
designated Articles, Sections, Subsections, paragraphs and other subdivisions
of this Debenture;
(d) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to paragraphs and
other subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Debenture as a whole and not to any particular
provision; and
(f) the term "include" or "including" shall mean without
limitation by reason of enumeration.
IN WITNESS WHEREOF this Debenture has been executed by the Owner
the day and year first above written.
SIGNED, SEALED and DELIVERED )
as a Deed and Debenture )
by )
for and on behalf of )
CALPETRO TANKERS (BAHAMAS I)
LIMITED )
in the presence:- )
SIGNED by )
for and on behalf of )
CALIFORNIA PETROLEUM TRANSPORT
CORPORATION )
in the presence of:- )
SCHEDULE 1
Defined Terms Used in the Debenture
"Assets" means, in relation to any person, the whole or any part of its
business, undertaking, property and assets and includes, without limitation,
any right to receive revenues.
"Assignment of Earnings and Insurances" means the assignment between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner assigns to the Lender all of its
right, title and interest in, to and under the freights and hires (as well as
any charters entered into after the Closing Date) with respect to the Vessel
to secure its obligations under the Loan Agreements.
"Assignment of Guarantee" means the assignment between the Owner and the
Lender, as amended from time to time in accordance with the terms thereof,
pursuant to which the Owner assigns to the Lender all of its right, title and
interest in, to and under the Chevron Guarantee to secure its obligations
under the Loan Agreements.
"Chevron" means Chevron Corporation.
"Chevron Guarantee" means the guarantee of the obligations of the
Initial Charter given by Chevron.
"Closing Date" means ________ __, 1994.
"Current Receivables" means (a) all obligations of the trade debtors of
the Owner due or owing to the Owner on account of the prevailing debit
balances of the present book debts of the Owner and (b) all rights relating to
the aforesaid property specified in paragraph (a), including, inter alia,
negotiable instruments, legal and equitable charges, reservations of property
rights, rights of action, collection, recovery or security, rights of tracing
an unpaid vendor's liens and similar and associated rights (and each reference
to a "Current Receivable" shall be construed as a reference to the whole or
any part of any one or more of them).
"Encumbrance" means any encumbrance and includes any mortgage, charge
(whether fixed or floating, pledge, lien, hypothecation, title retention or
other security agreement or security interest of any kind whatsoever and
howsoever arising and any equivalent or analogous interest to any of the
foregoing.
"Event of Default" means an Event of Default under Section ____ of the
Loan Agreement.
"guarantee" means any guarantee and also includes any indemnity, any
other form of assurance against financial loss and any other contingent
obligation or other obligation in respect of the payment of, or indemnity
against the consequences of default in the payment of, any indebtedness of any
person or the performance of any obligation by any person (and each reference
to the act of guaranteeing shall be construed accordingly).
"Initial Charter" means with respect to each Vessel, the Bareboat
Charter, dated as of ________ 1, 1994, between the Initial Charterer and
the Owner.
"Initial Charterer" means Chevron Transport Corporation.
"Issue of One Debenture" means each Issue of One Debenture between the
Owner and the Lender, as amended from time to time in accordance with the
terms thereof, pursuant to which the Owner grants to the Lender a security
interest in all of its assets.
"Person" means an individual, a partnership, a corporation, a joint
venture, an unincorporated association, a joint-stock company, a trust, or
other entity or a government or any agency or political subdivision thereof.
"right" means any right (actual or contingent, present or future)
expressed to be created under any agreement, law or directive, or arising by
operation of law and includes any power, authority, discretion, privilege,
remedy, title or interest arising under, by reason of, or in connection
therewith.
"Security Assets" means all of the present and future assets of the
Owner, including, inter alia, the Current Receivables (and each reference to a
"Security Asset" shall be construed as a reference to the whole or any part of
any one or more of them).
"Security Documents" means the Loan Agreement, the Mortgage, the
Assignment of Charter, the Assignment of Earnings and Insurances, the
Assignment of Guarantee, the Assignment of Management Agreement, the Issue of
One Debenture, collectively.
"Serial Loan Agreement" means the Loan Agreement, dated as of _______
1, 1994 between the Lender and the Owner pursuant to which the Lender will
make the Serial Loan to the Owner.
"Serial Obligations" means the payment, performance or obligations of
any kind or nature whatsoever of the Owner under and pursuant to the Serial
Loan Agreement, any Security Document and any instrument, agreement or
document referred to therein.
"Term Loan Agreement" means the Loan Agreement, dated as of _______ 1,
1994 between the Owner and the Lender pursuant to which the Lender makes the
Term Loan to the Owner.
"Term Obligations" means the payment, performance or obligations of any
kind or nature whatsoever of the Owner under and pursuant to the Term Loan
Agreement, any Security Document and any instrument, agreement or document
referred to therein.
"Trustee" means Chemical Trust Company of California.