DEED OF COMPOSITION WITH CREDITORS FOR PAYMENT IN INSTALLMENT BY THE DEBTOR AND GUARANTOR (WHERE PAYMENT IS SECURED BY AN ASSIGNMENT OF MONEY DUE UNDER CONTRACTS)
THIS DEED OF COMPOSITION is made on this ___ day of ____
BETWEEN
Sh.____________, S/o Sh.__________, R/o ____________________ (hereinafter called "the Debtor" which expression shall unless repugnant to the context include his heirs, legal representative and assigns) of the first part;
Sh.____________, S/o Sh.__________, R/o ____________________ (hereinafter called "the Trustee" which expression shall unless repugnant to the context include his heirs, legal representative and assigns) of the second part;
Sh.____________, S/o Sh.__________, R/o ____________________ and Sh.____________, S/o Sh.__________, R/o ____________________ (both hereinafter collectively referred to as "the Guarantor" which expression shall unless repugnant to the context include their heirs, legal representative and assigns) of the third part;
AND
All the several persons, firms and companies, being the Creditors of the Debtor, whose names and seal are hereunder signed and affixed and the amount of debt owed to them is set out in Annexure A to this document(hereinafter called "the Creditors" which expression shall unless repugnant to the context include their heirs, legal representative, successors and assigns as the case may be) of the fourth part:
WHEREAS
1. The Debtor is indebted to the Creditors to amounts as detailed in Annexure A hereto.
2. The Debtor is unable to pay the Creditors their debts in full and hence has proposed to pay to the Trustee a sum of Rs._____ to be distributed among the Creditors in proportion to their debts respectively and that such sum may be received by the Creditors in full discharge of their respective debts and claims against the Debtor;
3. The said composition is to be paid by way of three installments. The first of such installment to be paid on the _____ day of _________ and is to be secured by the assignment to the Trustee of the moneys due and accruing under certain contracts more particularly hereinafter specified. The second and third of the installments to be paid on the __ day of ____ and the ___ day of ___ , respectively and is to be secured by the joint and several promissory notes of the Guarantor;
4. The Guarantor has agreed to join in this deed for the purpose of guaranteeing the due payment of the said composition.
5. The Creditors have agreed to accept the offer of the Debtor and to take the said composition in full discharge to their respective debts and in consideration thereof, to grant to the Debtor the release hereinafter contained.
NOW THIS DEED WITNESSES AS FOLLOWS:
1. In pursuance of the premises the Debtor as beneficial owner hereby assigns to the Trustee all his rights, title and interest under the contracts dated _______ executed between Sh.________ and the Debtor. The Debtor further assigns all the moneys which are now payable or may become payable hereafter at any time under the said contracts.
2. The Trustee shall as soon as possible collect, get in, receive and compel payment of the said moneys. The Trustee shall further pay and apply the same, in or towards payment to each of the creditors and shall hold the surplus, if any, in trust towards payment of the remaining installments of this composition.
3. The Debtor and the Guarantor hereby jointly and severally covenant with the Trustee and the Creditors and each of them that if the said money shall not be sufficient to pay the first installment of the said composition the Debtor and the Guarantor or any one of them, shall on demand from the Trustee pay to him such sum as would make up the deficiency.
4. The Debtor hereby covenants with the Trustee to provide him all assistance for the discharge of his duties as a trustee. Further, the Debtor hereby appoints the Trustee as his attorney in his name and on his behalf to collect the said money and do all such acts as may be necessary and expedient thereto.
5. In further pursuance of the said agreement, the Debtor hereby covenants with the Trustee and each of the Creditors that the Debtor would pay the Creditors, the 2nd and 3rd installment of the composition on ________ and ________, respectively. The Guarantors have for the purpose of the timely payment of the remaining installments paid to the Trustee their joint and several promissory notes, the delivery of which the Trustee hereby acknowledges. The said promissory notes would be utilized towards the payment of the remaining installments to the Creditors as and when the payments are due.
6. The Guarantor shall not be released from his liability under this deed by reason of time being granted or indulgence granted to or by reason of any compromise or composition with the Debtor by the Trustee or the Creditor or any of them.
7. The Creditors hereby covenant that so long as the Debtor or the Guarantor pays the installments in time they shall not bring any action or legal proceedings against the Debtor. In case there is any breach of the covenant herein contained, this deed may be taken as a defense by the Debtor.
8. As and when the debts owed by the Debtor to the Creditors is paid in full, the Trustee shall certify to this effect. On the Trustee so certifying, the Debtor shall be released and discharged from all action, claim and demand in respect of the debts owed by him.
9. In the eventuality of the Debtor failing to pay or caused to be paid to the Trustee the any of the installment as aforesaid, within the specified time, the release of the debts by the Creditors as aforesaid shall be null and void.
10. In case the Debtor is adjudicated insolvent before payment of the whole of the said sum, in that case also the release of the said debts herein before contained shall be void and of no effect. In such an eventuality the Creditors and each of them shall be free to exercise all such rights and remedies that they would have been entitled to, had this deed not been executed.
11. The release herein before contained is only in respect of the Debtor and shall in no respect prejudice the rights of the Creditors or any of them against parties other than the Debtor, and the Creditors hereby expressly reserve all the rights and remedies against any such party or parties.
12. If any dispute shall arise with regard to any matter or things done under the foregoing provisions or otherwise in relation to this deed the same shall, if the parties fail to agree, be referred to the arbitration of Sh.____________, S/o Sh.__________, R/o ____________________. The decision of the arbitrator shall be final and binding on the parties.
IN WITNESS WHEREOF, the parties to this deed have scribed their hands on the day and year above mentioned.
Witnesses:
1.
The Debtor
2.
The Trustee
3.
The Guarantor
4.
The Creditors
Annexure A hereinabove referred
S.No.
Name and Address of the Creditor
Amount of Debt Due(in Rs.)
THIS DEED OF COMPOSITION is made on this ___ day of ____
BETWEEN
Sh.____________, S/o Sh.__________, R/o ____________________ (hereinafter called "the Debtor" which expression shall unless repugnant to the context include his heirs, legal representative and assigns) of the first part;
Sh.____________, S/o Sh.__________, R/o ____________________ (hereinafter called "the Trustee" which expression shall unless repugnant to the context include his heirs, legal representative and assigns) of the second part;
Sh.____________, S/o Sh.__________, R/o ____________________ and Sh.____________, S/o Sh.__________, R/o ____________________ (both hereinafter collectively referred to as "the Guarantor" which expression shall unless repugnant to the context include their heirs, legal representative and assigns) of the third part;
AND
All the several persons, firms and companies, being the Creditors of the Debtor, whose names and seal are hereunder signed and affixed and the amount of debt owed to them is set out in Annexure A to this document(hereinafter called "the Creditors" which expression shall unless repugnant to the context include their heirs, legal representative, successors and assigns as the case may be) of the fourth part:
WHEREAS
1. The Debtor is indebted to the Creditors to amounts as detailed in Annexure A hereto.
2. The Debtor is unable to pay the Creditors their debts in full and hence has proposed to pay to the Trustee a sum of Rs._____ to be distributed among the Creditors in proportion to their debts respectively and that such sum may be received by the Creditors in full discharge of their respective debts and claims against the Debtor;
3. The said composition is to be paid by way of three installments. The first of such installment to be paid on the _____ day of _________ and is to be secured by the assignment to the Trustee of the moneys due and accruing under certain contracts more particularly hereinafter specified. The second and third of the installments to be paid on the __ day of ____ and the ___ day of ___ , respectively and is to be secured by the joint and several promissory notes of the Guarantor;
4. The Guarantor has agreed to join in this deed for the purpose of guaranteeing the due payment of the said composition.
5. The Creditors have agreed to accept the offer of the Debtor and to take the said composition in full discharge to their respective debts and in consideration thereof, to grant to the Debtor the release hereinafter contained.
NOW THIS DEED WITNESSES AS FOLLOWS:
1. In pursuance of the premises the Debtor as beneficial owner hereby assigns to the Trustee all his rights, title and interest under the contracts dated _______ executed between Sh.________ and the Debtor. The Debtor further assigns all the moneys which are now payable or may become payable hereafter at any time under the said contracts.
2. The Trustee shall as soon as possible collect, get in, receive and compel payment of the said moneys. The Trustee shall further pay and apply the same, in or towards payment to each of the creditors and shall hold the surplus, if any, in trust towards payment of the remaining installments of this composition.
3. The Debtor and the Guarantor hereby jointly and severally covenant with the Trustee and the Creditors and each of them that if the said money shall not be sufficient to pay the first installment of the said composition the Debtor and the Guarantor or any one of them, shall on demand from the Trustee pay to him such sum as would make up the deficiency.
4. The Debtor hereby covenants with the Trustee to provide him all assistance for the discharge of his duties as a trustee. Further, the Debtor hereby appoints the Trustee as his attorney in his name and on his behalf to collect the said money and do all such acts as may be necessary and expedient thereto.
5. In further pursuance of the said agreement, the Debtor hereby covenants with the Trustee and each of the Creditors that the Debtor would pay the Creditors, the 2nd and 3rd installment of the composition on ________ and ________, respectively. The Guarantors have for the purpose of the timely payment of the remaining installments paid to the Trustee their joint and several promissory notes, the delivery of which the Trustee hereby acknowledges. The said promissory notes would be utilized towards the payment of the remaining installments to the Creditors as and when the payments are due.
6. The Guarantor shall not be released from his liability under this deed by reason of time being granted or indulgence granted to or by reason of any compromise or composition with the Debtor by the Trustee or the Creditor or any of them.
7. The Creditors hereby covenant that so long as the Debtor or the Guarantor pays the installments in time they shall not bring any action or legal proceedings against the Debtor. In case there is any breach of the covenant herein contained, this deed may be taken as a defense by the Debtor.
8. As and when the debts owed by the Debtor to the Creditors is paid in full, the Trustee shall certify to this effect. On the Trustee so certifying, the Debtor shall be released and discharged from all action, claim and demand in respect of the debts owed by him.
9. In the eventuality of the Debtor failing to pay or caused to be paid to the Trustee the any of the installment as aforesaid, within the specified time, the release of the debts by the Creditors as aforesaid shall be null and void.
10. In case the Debtor is adjudicated insolvent before payment of the whole of the said sum, in that case also the release of the said debts herein before contained shall be void and of no effect. In such an eventuality the Creditors and each of them shall be free to exercise all such rights and remedies that they would have been entitled to, had this deed not been executed.
11. The release herein before contained is only in respect of the Debtor and shall in no respect prejudice the rights of the Creditors or any of them against parties other than the Debtor, and the Creditors hereby expressly reserve all the rights and remedies against any such party or parties.
12. If any dispute shall arise with regard to any matter or things done under the foregoing provisions or otherwise in relation to this deed the same shall, if the parties fail to agree, be referred to the arbitration of Sh.____________, S/o Sh.__________, R/o ____________________. The decision of the arbitrator shall be final and binding on the parties.
IN WITNESS WHEREOF, the parties to this deed have scribed their hands on the day and year above mentioned.
Witnesses:
1.
The Debtor
2.
The Trustee
3.
The Guarantor
4.
The Creditors
Annexure A hereinabove referred
S.No.
Name and Address of the Creditor
Amount of Debt Due(in Rs.)
