This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
State of ---------.
No. --. $---------
The A. B. Company, of ---------, acknowledges itself indebted to the C. D.
Trust Company, Trustee, or to the bearer hereof, in the sum of --------- dollars, gold coin of the United States of America, which sum it promises to pay to the said the C. D. Trust Company, Trustee, or the bearer hereof, on the delivery and surrender hereof, on the --------- day of ---------, A. D. 19-, at the office of the
C. D. Trust Company, in the City of ---------, with interest thereon from the
---------day of---------, A. D. 19-, at the rate of ---------per centum, per annum, payable ---------at the said office on the --------- day of the months of --------- in each year, in like gold coin of the United States of America, on the presentation and surrender at the office of and to the said the C. D. Trust Company of the annexed coupons as they shall severally become due and payable under the terms hereof.
This bond is one of a series amounting in the aggregate to --------- dollars, consisting of --------- bonds for --------- dollars each, numbered from --------- to
--------, both inclusive, and all of which are of like tenor and date and the payment of which is secured by a duly recorded mortgage bearing date the --------day of ---------, A. D. 19-, duly executed and delivered by the A. B. Company to 6aid the C. D. Trust Company, Trustee, upon all of the corporate property, rights, franchises and privileges therein described and recorded in ---------.
Said the A. B. Company may, at its option, on the---------day of--------, 19-, or at any half-yearly interest period thereafter prior to ---------, 19-, pay the full amount of the principal of this bond in the manner set forth in the mortgage herein mentioned and thereupon (all interest hereon to the date of such payment having been fully paid) this bond shall become satisfied and discharged and all liability for further interest thereon shall cease; provided, that said the A. B. Company shall' pay, in addition to the principal and accrued interest upon this bond, a premium of --------- per centum upon the principal thereof.
This bond shall pass by delivery unless registered, and, <if registered, by transfer on the books of said Trustee, but shall not become obligatory until it shall have been authenticated by a certificate endorsed hereon, and duly signed for or by the Trustee. After registration no transfer except upon the books of said Trustee shall be valid unless the last transfer shall have been to bearer, which shall restore transferability by delivery; but this bond shall continue subject to successive registrations and transfers to a person specified, or to bearer as aforesaid, at the option of the holder hereof.
The holder of this bond shall not have the right to levy upon or cause said mortgaged premises to be sold under or by virtue of any judgment that may be obtained by reason of default in the payment of the principal hereof, or of the interest hereon, when and as the same shall become due by lapse of time or in pursuance of any of the provisions of said mortgage; but such proceedings shall only be had by the Trustee under the mortgage as aforesaid on behalf of and for the equal benefit of all the holders of said bonds, or upon the demand in writing of the holders of not less than a majority in amount of said bonds then outstanding and unpaid, as is provided in the said mortgage, for which provision and for all other the terms and conditions upon which this bond is made and issued, and all other the provisions therein contained for the security of the same, reference is hereby made to said mortgage. And the lien of any judgment that may be obtained upon this bond for any of the reasons aforesaid or any reason whatsoever, and any process, or writ of execution whatsoever, issued upon said judgment; or levy or sale made under such writ or process shall be limited and restricted to said mortgaged premises and no process, attachment, sequestration, or writ of execution whatsoever shall be issued upon said judgment against any other property, real, or personal or mixed, whatsoever or wherever, of said the A. B. Company, its successors or assigns, any provision in the said mortgage or anything in the laws of ---------, or any law, usage or custom to the contrary notwithstanding. In witness whereof, etc.
This form, with its provision for redemption at will, restrictions on right to bring an action on default, and provision against personal liability of the mortgagor affords the maximum of protection to the mortgagor and the minimum of protection to the mortgagee.
See references under Sec. 3764.