Mortgages and charges of shares

(1) A mortgage or charge of shares of a company incorporated under this Act must be in writing signed by, or with the authority of, the holder of the registered share to which the mortgage or charge relates. (2) Repealed. (3) A mortgage or charge of shares of a company incorporated under this Act need not be in any specific form but it must clearly indicate– (a) the intention to create a mortgage or charge; and (b) the amount secured by the mortgage or charge or how that amount is to be calculated. (4) A mortgage or charge of shares of a company incorporated under this Act may be governed by the law of a jurisdiction other than Belize but if a law other than the laws of Belize is specified as the governing law– (a) the mortgage or charge must be in compliance with the requirements of its governing law in order for the mortgage or charge to be valid and binding on the company; and (b) the remedies available to a mortgagee or chargee shall be governed by the governing law and the instrument creating the mortgage or charge save that the rights between the mortgagor or mortgagee as a member of the company and the company shall continue to be governed by the Memorandum and the Articles of the company and this Act. International Business Companies[CAP. 270 45 (5) If no law is specified to govern a mortgage or charge of shares of a company incorporated under this Act, the instrument creating the mortgage or charge shall be governed by the laws of Belize and, in the case of a default by the mortgagor or chargor on the terms of the mortgage, the mortgagee or chargee is entitled to the following remedies– (a) subject to any limitations or provisions to the contrary in the instrument creating the mortgage or charge, the right to sell the shares; and (b) the right to appoint a receiver who, subject to any limitations or provisions to the contrary in the instrument creating the mortgage or charge, may– (i) vote the shares; (ii) receive dividends and other payments in respect of the shares; and (iii) exercise other rights and powers of the mortgagor or chargor in respect of the shares, until such time as the mortgage or charge is discharged. (6) Sub-section (5) also applies to a mortgage or charge of shares of a company incorporated under this Act where the law of Belize is specified as the governing law. (7) Subject to any provisions to the contrary in the instrument of mortgage or charge of shares of a company incorporated under this Act, all amounts that accrue from the enforcement of the mortgage or charge shall be applied in the following manner– (a) firstly, in meeting the costs incurred in enforcing the mortgage or charge; 46 (b) secondly, in discharging the sums secured by the mortgage or charge; and (c) thirdly, in paying any balance due to the mortgagor or chargor. (8) The remedies referred to in sub-section (5) are not exercisable until– (a) a default has occurred and has continued for a period of not less than 30 days, or such shorter period as may be specified in the instrument creating the mortgage or charge; and (b) the default has not been rectified within 14 days from service of the notice specifying the default and requiring rectification thereof. (9) In the case of the mortgage or charge of registered shares, there may be entered in the share register of the company– (a) a statement that the shares are mortgaged or charged; (b) the name of the mortgagee or chargee; and (c) the date on which the statement and name are entered in the share register.