Companies Act, 1973 (Act No. 61 of 1973)Chapter V: Share capital, Acquisition by Companies of own Shares, Shares, Allotment and Issue of Shares, Members and Register of Members, Debentures, Transfers, and Restrictions on Offering Shares for SaleDebentures117. Security for debentures |
| 1) | The binding of movable property as security for any debenture or debentures may be effected by- |
| a) | a deed of pledge and the delivery of the movable property concerned to one or more debenture-holders or to a trustee for debenture-holders; or |
| b) | a notarial bond, collateral notarial bond or notarial surety bond executed in favour of one or more debenture-holders or of a trustee for debenture holders; or |
| c) | the pledging of incorporeal rights by means of cession of such rights, whether present or future, in due and proper form. |
| 2) | The binding of a ship may be effected by a deed of mortgage in the form prescribed by the Merchant Shipping Act, 1951 (Act No. 57 of 1951), recorded in the register by the proper officer at the ship's port of registry. |
| 3) | The binding as aforesaid of immovable property may be effected by a mortgage bond, collateral mortgage bond or surety bond executed in favour of one or more debenture holders or of a trustee for debenture-holders. |
| 4) | A wholly owned subsidiary shall be deemed to have and always to have had the power to mortgage any of its property as collateral security for the issue of debentures by its holding company. |