Moveable Hypothec Agreement

Letterhead

{{company_name}}

{{company_address}}

Phone: {{phone}}

Email: {{email}}

Website: {{website}}

MOVEABLE HYPOTHEC AGREEMENT

This Moveable Hypothec Agreement (hereinafter referred to as the “Agreement”) is made and entered into on this {{day}} day of {{month}}, {{year}}, by and between:

**Hypothecator:**

{{hypothecator_company_name}}, a company duly incorporated and registered under the laws of {{hypothecator_country}}, with its principal place of business at {{hypothecator_address}} (hereinafter referred to as the “Debtor” or “Hypothecator”).

AND

**Hypothecatee:**

{{hypothecatee_company_name}}, a company duly incorporated and registered under the laws of {{hypothecatee_country}}, with its principal place of business at {{hypothecatee_address}} (hereinafter referred to as the “Creditor” or “Hypothecatee”).

RECITALS

WHEREAS, the Hypothecator is indebted to the Hypothecatee in the principal sum of {{currency}} {{amount}} ({{amount_in_words}} Rand) (hereinafter referred to as the “Indebtedness”), for {{reason_for_indebtedness}}.

WHEREAS, the Hypothecator desires to secure the payment of the Indebtedness and the performance of all obligations under this Agreement by hypothecating certain movable property to the Hypothecatee.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties hereto agree as follows:

HYPOTHECATION OF MOVABLE PROPERTY

The Hypothecator hereby hypothecates, pledges and encumbers in favour of the Hypothecatee, as security for the due and proper fulfilment of all the Hypothecator’s obligations to the Hypothecatee, the movable property described in Schedule A hereto (hereinafter referred to as the “Hypothecated Property”). The Hypothecated Property includes, but is not limited to, the following:

{{description_of_movable_property}}

The Hypothecator warrants that it is the sole and absolute owner of the Hypothecated Property and that the said property is free from any other encumbrances, liens, or claims of any third party.

CONTINUING SECURITY

This hypothec shall constitute a continuing security for the due and proper fulfilment of all obligations of the Hypothecator to the Hypothecatee, present and future, howsoever arising, including without limitation, all amounts due and owing, interest, costs and charges.

POSSESSION OF HYPOTHECATED PROPERTY

Notwithstanding the hypothecation, the Hypothecator shall retain possession and use of the Hypothecated Property, unless and until an event of default occurs as provided for in this Agreement.

OBLIGATIONS OF THE HYPOTHECATOR

The Hypothecator undertakes to:

a) Maintain the Hypothecated Property in good order and repair at its own expense.

b) Insure the Hypothecated Property against all risks, including but not limited to loss, theft, and damage, for its full replacement value, with an insurance company acceptable to the Hypothecatee. The Hypothecatee shall be named as a loss payee on such insurance policy.

c) Not sell, alienate, encumber, or dispose of the Hypothecated Property without the prior written consent of the Hypothecatee.

d) Permit the Hypothecatee or its authorised representatives to inspect the Hypothecated Property at any reasonable time.

e) Notify the Hypothecatee immediately of any loss, damage, or seizure of the Hypothecated Property.

EVENTS OF DEFAULT

An Event of Default shall occur if:

a) The Hypothecator fails to pay any amount of the Indebtedness when due.

b) The Hypothecator breaches any term or condition of this Agreement or any other agreement between the Hypothecator and the Hypothecatee.

c) Any representation or warranty made by the Hypothecator in this Agreement proves to be false or misleading.

d) The Hypothecator becomes insolvent, files for bankruptcy, or is placed under liquidation or business rescue.

REMEDIES ON DEFAULT

Upon the occurrence of an Event of Default, the Hypothecatee shall be entitled, without prejudice to any other rights or remedies available to it in law, to:

a) Declare the entire Indebtedness immediately due and payable.

b) Take immediate possession of the Hypothecated Property wherever it may be found, without prior notice or judicial intervention.

c) Sell the Hypothecated Property by public auction or private treaty, at such price and on such terms as the Hypothecatee deems fit, and apply the proceeds of such sale towards the satisfaction of the Indebtedness and all costs incurred in the recovery of the Hypothecated Property and sale thereof. Any surplus shall be paid to the Hypothecator, and any shortfall shall remain due and payable by the Hypothecator to the Hypothecatee.

d) Exercise any other rights or remedies available to a secured creditor under the laws of {{country_of_jurisdiction}}.

GOVERNING LAW AND JURISDICTION

This Agreement shall be governed by and construed in accordance with the laws of {{country_of_jurisdiction}}.

The parties hereby irrevocably submit to the non-exclusive jurisdiction of the courts of {{country_of_jurisdiction}} for the purpose of any legal action or proceeding arising out of or relating to this Agreement.

GENERAL PROVISIONS

a) **Amendment:** No amendment or variation of this Agreement shall be valid unless reduced to writing and signed by both parties.

b) **Waiver:** No indulgence or extension of time granted by the Hypothecatee shall constitute a waiver of any of its rights under this Agreement.

c) **Severability:** If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.

d) **Entire Agreement:** This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior discussions, negotiations and agreements, whether oral or written.

SIGNATURES

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

**HYPOTHECATOR**

___________________________

Name: {{hypothecator_signatory_name}}

Title: {{hypothecator_signatory_title}}

Date: {{date_signed_hypothecator}}

**HYPOTHECATEE**

___________________________

Name: {{hypothecatee_signatory_name}}

Title: {{hypothecatee_signatory_title}}

Date: {{date_signed_hypothecatee}}

**SCHEDULE A: DESCRIPTION OF HYPOTHECATED PROPERTY**

{{schedule_a_description}}