Some text in this preview is hidden by to prevent copying

Highlighted text indicates that you need to enter information. Our guidance notes will help you with the editing.

Debenture Agreement

£19.00

A Debenture is a document creating security, normally a collection of mortgages and/or fixed and floating charges over the borrower’s assets.

 
 
  • Professionally Drafted & Regularly Updated
  • Written in Plain English – Easy to Use & Edit
  • 100% Money Back Guarantee
  • Instant download with guidance notes

When a lender makes a loan to a borrower the lender will also want some form of security in exchange for giving the loan, which is designed to protect the lender's position in the event the borrower fails to repay the loan. If the lender wants to have security for the sum that has been borrowed there will generally be two different agreements: 

  1. a Loan Agreement which covers the borrowing (also called a “Credit Agreement” or “Facility Agreement”); and
  2. a security document such as a Debenture which sets out the terms of the security given to the lender in return.

A Debenture secures a loan using the borrower's assets and all terms and conditions and warranties are recorded in the Debenture.

Companies borrow finance from a range of sources and there are different types of charges that a lender may take in order to have security for the sum borrowed. Security over the company's assets is usually in the form of an 'all-monies' Debenture, secured with fixed and floating charges over all the company's assets. Thus, a Debenture is a written agreement between a lender and a borrower that records the details of the parties to the loan and sets out the charges the lender will have i.e. "fixed" and/or "floating" charges over the assets of the company.

Security created by a company needs to be registered at Companies House; if the charge affects land it may also need to be registered at the Land Registry or in the case of unregistered land with the registrar of land charges.

Every type of charge on a company's assets must be registered at Companies House within 21 days of the creation of the charge. Failure to do so renders the charge void against the company's administrator or liquidator, or any creditor of the company. This means that the debt for which the charge was given will remain payable, but it will be unsecured. It is important to note that as security is taken as protection against insolvency, the fact that a charge is not valid as against a liquidator or administrator means that the security will effectively be worthless if not registered.

N.B. Failure to register any charge at Companies House within 21 days of the creation of the charge renders the charge void against an administrator, liquidator or another creditor, however, the charge remains valid against the company.

The statutory duty to register the charge rests on the company and its officers, but the lender is entitled to register the charge on the company’s behalf so as to ensure that the priority of the charge is not lost.

N.B. If a registrable charge is not registered in time, then the company that created the charge and every officer of the company who is in default are liable to a fine.

In order to register the Debenture the following documents must be filed with Companies House within 21 days of the date of creation of the charge: 

  • The Debenture
  • The Loan Agreement
  • The relevant Form (Form MG01 for a charge created before 6 April 2013 & Form MR01 for a charge created on or after 6 April 2013),
  • The required Fee

N.B. When a charge has been created the company also has a duty to update its register of charges however failure to do so will not affect the validity of the security.

Please note that even if the company does not need to inform Companies House that it has fully or partly paid off a charge, generally when a charge is released it is in the interest of the company to lodge with Companies House a memorandum of satisfaction using Form MR04 (regardless of whether the charge was originally created before, on or after 6 April 2013).

Finally, it is clear that a Debenture over a borrower’s assets is an invaluable document as it gives the holder priority rights for repayment should the company become insolvent. Furthermore this Debenture also contains a clause giving the lender the right to appoint a receiver.

This Debenture template contains the following clauses:

  1. Definitions and Interpretation
  2. Borrower's Obligations
  3. Security
  4. Crystallisation
  5. Borrower's Representations and Warranties
  6. Borrower's Undertakings and Covenants
  7. Borrower's Liability
  8. Enforcement
  9. Receivers
  10. Powers of Sale
  11. Accounts
  12. Attorney
  13. Sums Received
  14. Indemnities
  15. Release
  16. Confidential Information
  17. Variation
  18. Severance
  19. Waiver
  20. Rights of Third Parties
  21. Assignment and Subcontracting
  22. Entire Agreement
  23. Succession
  24. Notices
  25. Governing Law and Jurisdiction

SCHEDULE 1

SCHEDULE 2

SCHEDULE 3


This Debenture is in Microsoft Word format, written in plain English, easy to use and edit.

Check My Template Service

£59.99


If you need help with editing your Template the Check My Template Service is the solution for you.


With our Check My Template Service, a lawyer will check over your edited document to ensure the information you added is correct and the document is complete, legally binding and will achieve your goals. We will also check that your use of defined terms is correct and consistent and correct spelling mistakes, so that you can be confident that your edited document template is ready for signature.

What You Get: 

ok Icon Detailed assessment of your edited document template

ok Icon We answer all questions you might have relating to your document template

ok Icon Check that your use of defined terms is correct and consistent

ok Icon  Correct spelling mistakes

ok Icon Ensuring your document template is ready to sign


How It Works: 

 Edit your document template as fully as possible

 Send the document to us - either by uploading it through our website or by e-mailing it to info@thelegalstop.co.uk

 We will get in touch with you if we need more information

 We return your reviewed document ready to sign within 2 working days


Uploading ...

Need help with your template? Do you have questions on a template? Please get in touch!

You can use the phone number or contact form below to get in touch with us.

+44 (0) 208 870 5522

Uploading ...

Send

Can’t Find Your Template? Request It Now!

If we currently don’t have the template you need we can always draft it for you at no extra cost & 100% money back guaranteed, simply send us a no obligation request by filling in the form below.

We aim for a 7 day turnaround - you will receive an email notification when your template is ready for download from our website.

Request a Template Service

Can’t Find Your Template? Request It Now!

  • If we don’t have your template we can draft it for you
  • We aim for 7-day turnaround – you get notified when your template is ready
  • No obligation & No extra costs!

Are you human?

10 + 6 =

Please add the two numbers

Continue
This site uses cookies to improve your user experience. By using this site you agree to these cookies being set. To find out more see our Privacy Policy OK