a dead or minimum rent of 5,000l. and certain royalties; that the lessee should Form 642. take all the liabilities of the leases under which the company held the mines; and that the lease should include the plant and machinery belonging to the company; and the lessee agreed to have 10,000l. ready to be expended as capital at the commencement of the lease, and to expend so much of that sum as should be required in working the mines, and that he would indemnify the company and the trustees and the secured creditors of the company against all liabilities up to the date of the lease, other than the monies secured by the deed of trust, for the benefit of the debenture holders; and it was agreed that the liquidators should assign to the lessee all the assets of the company. The agreement was expressed to be made subject to the sanction of the court, and to its being executed as an arrangement with creditors under the Act of 1870.

The agreement was approved at the meeting of debenture holders, and upon summons taken out by the trustees, was confirmed by Malins, V.-C. Shortly afterwards the arrangement was approved at a meeting of members of the company in accordance with s. 160 of the Act of 1862.

A dissentient debenture holder appealed from the order of the V.-C., but the appeal was dismissed. The case is reported in 11 C. Div. 605.

The Northampton Coal and Iron Company, Limited.

Arrangement for reconstruction by sale to new company: debenture holders to accept debentures, and unsecured creditors composition.

The company was being wound up under supervision. Meetings were called pursuant to the following order:

Upon the application of F. J. P., the liquidator of the above-named Form 643. company, and upon hearing the solicitors of the said liquidator, and Order for upon reading an order dated, &c. [supervision order], and an affidavit, meeting. &c. It is ordered that the said liquidator be at liberty to call a meeting or meetings of the creditors and debenture holders of the said company for the purpose of considering a scheme of compromise or arrangement to be made between such creditors and debenture holders and the company, and that the said liquidator be the chairman of such meeting or meetings." Northampton Coal, &c., Co., Malins, V.-C., at Chambers, 8 August, 1876. B. 1433.

And resolutions having been passed approving of the proposed arrangement, an order sanctioning the same was obtained on summons. The order was as follows:

Order con

scheme.

"Upon the application of F. J. P., the liquidator of the above-named Form 644. company, and upon hearing the solicitor for the said liquidator, and upon reading an order dated the 8th August, 1876 [calling meeting, see firming supra]. It is ordered that the scheme of compromise or arrangement, pursuant to 33 & 34 Vict. c. 104, resolved upon at the meetings of the shareholders and debenture holders of the above-named company, held at the Hotel, at, on the 23rd day of August, 1876, and duly confirmed by the shareholders of the said company at a meeting of shareholders held on Monday, the 11th day of September, 1876, at the

Form 644. offices of the company situate at

Form 645.

Order con

firming scheme,

be sanctioned and carried into effect, which said resolutions are as follows, that is to say, “(1.) That J. T. P., the liquidator of this company, be, and he is hereby authorised to sell to a new company to be formed for the purpose of acquiring the same, all the property of this company, subject to the debts and liabilities thereof, in consideration of 8,000 shares of 107. each in such new company, with 61. per share credited as paid up thereon, such shares to be divided among the shareholders of this company in the proportion of one share in such new company for each share now held in this company.

"(2.) That the debenture holders of this company accept in satisfaction and discharge of their claims against such company perpetual debentures to the same amount respectively in a new company intended to be formed for the purpose of acquiring the assets and property of this company, bearing interest at 47. 10s. per cent. per annum from the 30th day of March, 1876.

"(3.) a. That a composition of 12s. in the pound be accepted in satisfaction of the debts due to the creditors of this company (other than the debenture holders). b. And that such composition be payable by three instalments at 3, 6, and 9 months respectively from the date of the confirmation of these resolutions by the Court." Northampton Coal, &c., Co., Malins, V.-C., at Chambers, 12 Sep. 1876. B. 1598.

A scheme of this kind is sometimes sanctioned in a bankruptcy, under s. 28 of the Bankruptcy Act, 1869. Thus in the bankruptcy of Messrs. Fothergill & Hankey the assets were made over to the Aberdare and Plymouth Company Limited, and the creditors received debentures in satisfaction of their claims. See Ex parte Turquand, In re Fothergill, 3 C. Div. 445.

The Darlaston Coal and Iron Company, Limited.

Arrangement for reconstruction by sale to new company: debenture holders and other creditors to accept shares: winding up continued.

The company was being wound up compulsorily, and there was an action pending for the administration of the trusts of a deed for securing debentures. A petition was presented by the liquidator to obtain the sanction of the court to a scheme of reconstruction. The petition was intituled in the action and in the Acts of 1862 and 1867. The scheme provided, among other things, that the debenture holders and unsecured creditors should accept fully paid-up shares in the new company, in satisfaction of their debts. The Master of the Rolls directed that meetings of the debenture holders, the unsecured creditors, and the shareholders should be held, and that the petition should be amended by intituling it in the Act of 1870. W. N. 1877, 139. And the scheme having been approved thereat, an order was made sanctioning the same. W. N. 1877, 165. The following is a copy:

Upon the petition of W., the off. liq., &c. : And this court being of opinion that the arrangement or compromise embodied in the heads of the said reconstruction scheme in the petition set forth including the

said undertaking as varied as afsd. is proper to be carried into effect Form 645. doth hereby sanction the same, and doth declare the said scheme to be binding on all the members and creditors of the said co., and doth order the same arrangement to be carried into effect by the petitioner W. the liquidator, and that the defendants C. H. and R. M. do execute ali such deeds for that purpose as the judge in chambers shall direct: And it is ordered that it be referred to the taxing master to tax as between solicitor and client the costs of the petitioners and respondents and of the other parties hereinbefore mentioned as appearing herein, except the S. Co. & the T. Co., of this application and consequent thereon and of the said action: And it is ordered that such costs when taxed be paid as provided by the said reconstruction scheme as follows, &c., but the said liquidator is notwithstanding to be at liberty to retain such costs as costs of the winding up out of the assets of the co., And [receiver continued as receiver until further order]; And all further proceedings in the action stayed except the account No. 1 directed by the said order dated 2 June, 1877, and any of the parties are to be at liberty to apply in the said action in reference to the carrying of the said arrangement into effect or otherwise as they may be advised. Slater v. Darlaston, &c., Co., 1877, S. 210, M. R., 25 June, 1877. B. 1317.

The Llynvi, Tondû and Ogmore Coal and Iron Company, Limited.

Arrangement for sale of assets to new company: debenture holders to give time, &c., and unsecured creditors to accept composition.

This company was being wound up under the supervision of the court, and the scheme embodied in the following resolutions was proposed.

1. That a new co. be formed with a capital of 258,000l. divided into Form 646. 17,200 7 p. c. preference shares of 57. each, and 8,600 ordinary shares of New co. to be 207. each, for the purpose of acquiring all the property and assets of this formed. co. subject to the debts and liabilities thereof.

made over.

2. That S. the liq. of this co. be, and he is hereby authorised, to sell Assets to be to such new co. as from 31 Dec. 1879, all the property and assets of this co. subject to the debts and liabilities thereof as on the same date, including therein the Llynvi series debentures secured on the Llynvi property, and the Tondû and Ogmore series debentures secured on the Tondû and Ogmore property, but not the general series debentures, the consideration for such sale to be 8,600 ordinary shares of 207. each in the new co. credited as fully paid up, and 8,600 of the said preference shares subject to the liability of paying 57. per share thereon.

3. That each of the members of this co. be entitled to one of the said Rights of ordinary shares in the new co. for each share now held by him in this members. co., on condition that he shall within such time or times as shall be fixed by the committee hereinafter referred to, subscribe or procure to be subscribed for at par one of the said preference shares for every ordinary

Form 646. share to which he shall be so conditionally entitled, and pay up 21. per share thereon, the balance of 31. per share being also made payable within such further time as shall be fixed by the said committee for that purpose.

Special provision.

Interest on debentures reduced as regards

arrears.

How

debenture holders of

general series to be satisfied.

Composition to unsecured creditors.

Reserve fund.

4. That if any of the members of this co. shall make default in subscribing or procuring to be subscribed for the preference shares, which, under the preceding clause, ought to be subscribed for by him, and paying up the said 27. per share thereon; then the liq. may sell the right to such preference shares, together with the corresponding number of ordinary shares to which such member would have been entitled if he had made such subscription and payment, the amount realised by such sale to be paid over to such last-mentioned member.

5. That the debenture holders of this co. of the Llynvi series accept in satisfaction and discharge of their claims against the co. for two years' arrears of interest, ending 30 June, 1879, interest at the rate of 3 p. c. p. a. (the interest for the current half-year ending 31 Dec. 1879, to be paid at the rate of 6 p. c. p. a.), and by indorsement on their debentures shall extend the due date of one-half of such debentures to 31 Dec. 1884, and of the remaining half to 31 Dec. 1886, at which respective dates they are to be paid off at par subject to the right of the new co. to pay off such debentures by instalments of not less than 10 per cent. previously to those dates respectively, six months previous notice to be given of the payment of any such instalment. The rate of interest for the extended periods to be 6 p. c. p. a. as heretofore, and fresh coupons to be issued by the new co. for the half-yearly payments of such interest.

6. Similar provisions as to debentures of Tondû and Ogmore series. 7. That the debenture holders of this co. of the general series accept in satisfaction and discharge of their claims against this co. for two years' arrears of interest, prior to 23 May, 1879, interest at 3 p. c. p. a., the interest from such 23 May, 1879, to 31 Dec. 1879, to be paid at the due rate of 6 p. c. p. a., and also to accept in satisfaction and discharge of their claim against this co. for principal, 84 p. c. of the nominal value of their debentures (being the amount actually advanced on such debentures) giving credit as against such 84 p. c. for any amount already paid to them on account of the principal of their debentures.

8. That a composition of 10s. in the pound payable half in cash and half in preference shares of the new company within 4 calendar months from the date of the order of court sanctioning this scheme of arrangement be accepted in satisfaction of the debts due to the simple contract creditors of this co., except such debts as are due to workmen for wages, in the case of which a composition of 10s. in the pound shall be payable wholly in cash within the like period.

9. Dividend payable to the holders of preference shares in new co, to be cumulative.

10. That with a view to the protection of the debenture holders, and in order to form a fund for their payment, one-half only of the surplus profits of the co. in each year after payment of the dividend on the pre

ference shares, shall be distributed among the ordinary shareholders, and Form 646. the remaining half of such surplus profits shall be invested and accumulated as a reserve fund to be applied in paying off the debentures. Provided that the obligation to keep up such reserve fund shall cease when all the present debentures are paid off, or if all the holders of such debentures for the time being consent thereto.

entitled to

11. The debenture holders shall be entitled to vote at all elections of Debenture directors of the new co., each debenture holder having the same number holders to be of votes in respect of the principal monies secured by his debenture or votes. debentures as he would have had if he were the holder of share capital to the like amount, and every 207. of share capital shall give one vote. 12. That the present committee of holders of debentures and shares, Committee to acting by a majority of their number, shall, subject to the approval of superintend carrying out the court, direct and control the carrying out of the foregoing resolu- of scheme. tions, and the taking of the necessary legal and other proceedings to give effect thereto, and have power to make modifications from time to time in any of the details of the scheme embodied in the foregoing resolutions, provided that no modification affecting the rights of the holders of the Llynvi series debentures shall be made without the consent in writing of the trustees for such series, or their solicitors, and that no modification affecting the rights of the Tondû and Ogmore series of debentures, or of the General series of debentures, shall be made without the consent in writing of the trustees for such respective series, or their solicitor or solicitors.

Pursuant to the directions of Malins, V.-C., meetings of the shareholders, debenture holders, and creditors of the company were convened, to consider the arrangement; and resolutions of approval were duly passed. A petition was then presented and an order made, 30 January, 1880, sanctioning the arrangement. On 17 Feb. 1880 an agreement was made between S., the liquidator, of the first part, the committee of debenture holders of the second part, and C. on behalf of the intended new company of the third part. The agreement recited: the formation of the old company; the resolution to wind up and appointing S. liquidator; the supervision order; that the capital was 430,000l., divided into 8,600 shares of 501. each, the whole of which had been called up; that at the commencement of the winding up the company had issued debentures to the total amount of 221,5837. as follows, that is to say-(a) Debentures called "Llynvi Series," to the amount of 78,2451. charged upon the old company's property at L.; (b) Debentures called "Tondû and Ogmore Series," to the amount of 130,6837., charged upon the old company's property at T. and O.; (c) Debentures called "General Series," to the amount of 12,655l., charged (subject to the charges in favour of the debenture holders of the L. Series and of the T. and O. Series) upon the L. and T. and O. properties, and also upon the plant and stocks of the company; and that at the commencement of the winding up, the company was indebted to unsecured creditors (other than workmen for wages) to the amount of 62,7781. 10s., including 27,3371. 38. 8d. for arrears of rent and royalties; and that the business had been kept going with the sanction of the court; and that the meetings had been held and approved of the scheme set forth in schedule; and that order had been made sanctioning the scheme; and that the new company was intended to be formed for the purpose of carrying out the scheme; and that the capital of the new company was to be 258,000l., in 17,200 7 p. c. preference shares of 51. each, and 8,600 ordinary shares of 201. each, and provided as follows: