Form 164. be taken as conclusive, and that the concluding words showed that the parties did not intend to execute a deed. Clement v. Gunhouse, 5 Esp. 83. The maxim expressio unius est exclusio alterius is applicable in such a case. See also Chanter v. Johnson, 14 M. & W. 408. Upon similar grounds it would seem that the form of a debenture concluding as above would show clearly that the instrument was not intended to be a deed, and accordingly that the affixing of the common seal could not make it a deed. The scal will be regarded as an earmark. Dutton v. Marsh, L. R. 6 Q. B. 361. See also Halford v. Cameron's Coal-brook, &c., Co., 16 Q. B. 442; 20 L. J., Q. B. 160; Aggs v. Nicholson, 1 H. & N. 165; 25 L. J., Ex. 348; and Balfour v. Ernest, 5 C. B. N. S. 601; in which cases instruments executed by directors on behalf of companies were sued on as simple contracts, though the seal of the company was aflixed. As already mentioned, a debenture in the above form should be stamped as a promissory note, and the fact that it is so stamped, and is "to bearer," will go still further to show that it was not intended to be a deed, and that it was intended to be a promissory note. Ex parte Colborne and Strawbridge, 11 Eq. 478; Blakely Ordnance Co., 3 Ch. 154; Ex parte City Bank, 3 Ch. 758. If the seal is to be affixed, it may be placed opposite the signatures of the directors, and the secretary can subscribe his name to an attestation clause. Form 165. Mortgage debenture to bearer. Issue of 20,0007. in 200 mortgage debentures of 1007. each, bearing interest at the rate of ten per cent. per annum. The above will be varied according to circumstances. If the debentures are to vary in date and amount, it may run thus:-"Debenture loan not to exceed 20,0007., and carrying interest, &c." And the company doth hereby charge with such payments its undertaking and all its property both present and future [including its uncalled capital for the time being]. This debenture is issued [supra, Form 158]. Given, &c. [supra, Form 158]. As to the effect of such a charge, see supra, p. 229. The words in brackets will be omitted if it is not intended to charge the uncalled capital. As to the power to charge uncalled capital, see supra, p. 237. Some persons prefer to enumerate some of the items charged, e.g., "All the collieries, mining rights, buildings, plant, machinery, book-debts, credits, and monies of the company, and all other its real and personal property both present and future." Sometimes only part of the property is charged. If, in accordance with the plan referred to, supra, p. 230, the debentures are to be secured, in part, by a trust or covering deed, the above form will be altered, by introducing the words "not comprised in the indenture hereinafter mentioned," after the words "present and future;" and by introducing an additional condition as follows: 8. The holders of the debentures of this issue (including the bearer hereof), are entitled, pari passu, to the benefit of an indenture, dated, &c., and made, &c., whereby certain [letters patent] and other property of the company were vested in trustees for securing the payment of the principal monies and interest payable by Form 165. virtue of such debentures. See also Form 166 and Schedule 1, to Form 171. The conditions within referred to : 1. This debenture is one of a series of like debentures issued or about to be issued by the company for securing principal sums, amounting [or not exceeding] in the aggregate 20,000l. If necessary, omit the word "like," and add "such debentures are all to be in like form, saves as to dates of issue and payment, and amount secured." Sometimes a condition as follows is inserted. "The company may issue further debentures ranking pari passu, with the debentures of this series; but so that the aggregate amount of the principal monies secured by the debentures of this series, and such further debentures shall not at any time exceed [30,0001.]. 2. The debentures of the said series shall rank pari passu [as a first charge upon the property within mentioned] and without any preference or priority one over another. If the debentures are not to be a first charge, the words "in point of charge "can be substituted for the words in brackets, or if they are to be a second charge, the above condition will be modified accordingly, e.g., it will provide that: "The debentures of the said series shall rank pari passu without preference or priority, one over another, as a second charge, upon the within mentioned property, namely, next after such of the mortgage debentures issued by the company in the year as shall, for the time being, be outstanding." Sometimes there is a mortgage affecting part of the property charged, in which case the following proviso may be added to Condition 2: "Provided always that so far as regards the hereditaments comprised in an indenture, dated, &c., and made, &c. (being a mortgage for securing 5,000l. and interest), the said debentures shall be subject to such mortgage." 3. The charge created by this debenture shall be a floating security, and accordingly the company may, in the course of its business and for the purpose of carrying on the same, deal with the property hereby charged in such manner as the company may think fit, and in particular, may sell, lease and exchange the same, may pay and receive money, and may declare and pay dividends out of profits. [See, as to this clause, supra, p. 231.] 4. If the company [supra, p. 245, (6)]. 5. The power given by Clause 3 hereof shall cease if default is made in the payment of any principal monies hereby secured at the time when the same become payable in accordance with the tenor hereof, or if any such order or resolution as aforesaid is made or passed. If Clause 4 is not inserted, the above clause should be modified by substituting the following words: "Or if default is made in the payment of any interest hereby secured for a period of six months after the same shall have become payable, or if an order of some court of competent jurisdiction is made or a special or extraordinary resolution is passed for the winding up of the company "-for the last thirteen words of the above clause. 6. Nothing herein contained shall be taken to authorise the creation of any mortgage or charge on the [freehold and leasehold] property for the time being of the company in priority to the charge hereby created. The power given by Clause 3 is sometimes more or less qualified. Form 165. Form 166. Debenture secured by trust deed. 7 to 11. [Same as Clauses 1, 2, 3, 4, and 7 of Form 158.] The above debenture should be stamped as a mortgage, infra, p. 241. It is not usual to register such debentures as bills of sale, and where it is desired to have a registered security, there should be a trust deed as in Form 171, and the debenture will then be framed as in the first schedule to that form. Debentures, whether secured by a charge therein contained or by a trust deed, are commonly called "mortgage debentures," and although where the debenture is secured by a trust deed, the technical propriety of the name may be questioned, there can be no doubt of its propriety when the debenture itself contains a charge, for the charge is an equitable mortgage. Whether technically correct or not, the term is in common use, and concisely expresses what is in substance the distinguishing characteristic of the instrument. The Mortgage Debenture Act, 1865 [supra, p. 53], applies the term mortgage debenture to the securities to be issued pursuant thereto, but of course the Act gives no exclusive right to the name, and hundreds of companies have accordingly applied the name to securities issued by them independently of the Act. Sometimes the term "mortgage debenture bond," or "first mortgage debenture," is preferred. The debenture, coupon, and conditions will be as in Forms 158, 158a, and 1586, omitting, if thought desirable, Clause 5 of the conditions, but adding the following: The holders of the debentures of the above issued (including the bearer hereof) are and will be entitled pari passu to the benefit of and subject to the provisions contained in an indenture dated the of day and made between the company of the one part, and A., B., and C. of the other part [whereby the property of the company, both present and future, was vested in trustees for securing the payment of the principal monies and interest payable in respect of the said debentures]. The words in brackets will be varied according to circumstances. Sometimes they are omitted altogether. Form 167 will also in some cases be inserted immediately before the above clause. Form 167. Power to call for registered debenture instead off debenture to bearer. Upon the request in writing of the bearer hereof the company will issue to him a debenture in either of the forms set forth in the second and third schedules to the indenture below mentioned. Such debenture shall provide for the payment of the principal monies and interest hereby secured and then remaining unpaid, at the times hereby fixed for the payment thereof respectively. Upon or before such issue this debenture must be surrendered to the company, and the person making such request must pay the expense of stamping the new debenture, and such sum, not exceeding ten shillings, for the expense of issuing the same as the company shall prescribe. It is not at all uncommon now, where debentures are secured by a trust deed, besides giving subscribers the option of taking their debentures in one of several forms [supra, p. 225], to set out the forms in schedules to the trust deed, and insert on each debenture a clause as above. That clause is intended for use where three forms of debentures are used, namely, "to bearer," "registered," and "registered Form 167; with coupon to bearer," but it can easily be modified. The clause can only be inserted where the form of debentures is set out in some trust deed [see Form 171] or other document: if there is no trust deed, the company can execute a deed poll reciting its intention to issue debentures in the forms set forth in the schedules, and this deed can be filed with the Registrar of Joint Stock Companies. TRUST DEED for SECURING MORTGAGE DEBENTURES ISSUED by a The following precedent can be readily adapted to secure the payment of deben- The provisions of the following precedent are more elaborate than in many cases is requisite, but the draftsman can readily expunge the clauses not required in any particular case. of between The THIS INDENTURE made the Company, Limited, (hereinafter called the company,) of the one part, and A., of, and B., of, of the other part. WHEREAS the company is seised of the freehold hereditaments the short particulars of which are specified in the first schedule hereunder written, for an estate of inheritance in fee simple in possession, free from incumbrances; and is possessed of the several leasehold hereditaments, the short particulars of which are specified in the third column of the second schedule hereunder written, for the several terms of years specified in the second column of the same schedule, and granted by the several indentures of lease, the dates whereof and parties whereto are specified in the first column of the same schedule, at the rents and royalties, and subject to the covenants and conditions in the said several leases respectively reserved and contained, but otherwise free from incumbrances: AND WHEREAS the company is entitled to the full benefit and advantage of certain agreements, the dates whereof and parties whereto, and the short particulars of which are specified in the first and second columns respectively of the third schedule hereunder written, at the several rents (if any,) and subject to the terms and conditions in the said agreements respectively reserved and contained, but otherwise free from incumbrances: AND WHEREAS the company is possessed of other personal property of considerable value; namely, of plant, machinery, stock-in-trade, debts, and other choses in action, monies, chattels and effects: AND WHEREAS the directors of the company in exercise of the powers vested in them by the regulations of the Form 168 Trust deed. Parties. Recitals. Testatum 1. Grant of freeholds. Form 168. company have determined to borrow for the purposes of the company the sum of 100,000l. by the issue of 1,000 mortgage debentures for 1007. each, bearing interest at the rate of six per cent. per annum payable half-yearly on the 1st day of November and 1st day of May in each year, according to the coupons annexed thereto (such debentures and coupons respectively to be in the form set forth in the fourth schedule hereunder written,) and to further secure the principal monies and interest for the time being payable according to the tenor of the said debentures (hereinafter called the debentures), and the performance of the stipulations and conditions therein contained in manner hereinafter appearing: NOW THIS INDENTURE WITNESSETH, that for effectuating the said intention and in consideration of the premises the Company doth hereby grant unto the said A. and B., their heirs and assigns: ALL and singular the lands and hereditaments, mines, strata, veins, or seams of coal, culm, and other minerals, powers, and privileges, respectively specified or referred to in the first schedule hereunder written; TOGETHER with the messuages, engine-houses, forges, foundries, buildings, fixed engines, plant and machinery, railways, tramways, and other fixtures in or upon the said lands and hereditaments, and with all privileges, easements, franchises, advantages, rights, and appurtenances, to the said hereditaments, or any of them, appertaining or with the same or any of them, now or heretofore enjoyed or reputed as part or member thereof or appurtenant thereto; AND ALL the estate, right, title, interest, claim and demand whatsoever of the company in, to, or upon the same: TO HAVE AND TO HOLD the said hereditaments and premises hereinbefore expressed to be hereby granted unto and to the use of the said A. and B., their heirs and assigns, but upon and for the trusts and purposes hereinafter expressed concerning the same: AND THIS INDENTURE ALSO WITNESSETH, that, for further effectuating the said intention and for the consideration aforesaid, the company doth hereby demise unto the said A. and B., their executors, administrators, and assigns: ALL and singular, the lands, hereditaments, copper-works, brick-works, patent-fuel- works, mines, veins, seams, beds, and strata of coal, culm, and other minerals, powers and privileges specified or referred to in the second schedule hereunder written, with their respective rights, easements, and appurtenances: To HAVE AND TO HOLD the said premises hereinbefore expressed to be hereby demised unto the said A. and B., their executors, administrators, and assigns, for all the respective residues now unexpired of the said several terms for which the same premises were respectively granted by the several indentures of lease mentioned in the first column of the said schedule, except the last day of each of the said terms, but upon and for the trusts and purposes hereinafter expressed of and concerning the same: AND THIS INDENTURE ALSO WITNESSETH, that, for further effectuating the said intention and for the consideration aforeAssignment of said, the company doth hereby assign unto the said A. and B., their executors, administrators, and assigns: ALL and singular, the full Habendum. Testatum 2. Demise of leaseholds. Habendum. Testatum 3. benefit of agreements for leases, &c. |