Pledge Contract Example

A pledge contract is a contract that seeks or is intended to leave a property or possession as collateral, which must be in full availability and solvency in order to have it.

If there is income or profit, it will continue to be received by whoever pledges the property or thing object of this contract, or you can leave as payment the payment or profit produced by the thing or object that remains captivated.

Example of a pledge contract:

GARMENT CONTRACT

Contract entered into in Mexico City, Federal District, on August 15, 2012, and for the same purpose the Messrs. Carolina Rojo Uribe, 29 years old, appear, of Mexican nationality, married, employed, native and neighbor of the municipality of Texcoco Estado de México, residing at house number 45 on Dávalos street, colonia Tipillo, who declares that he has no tax debts and with federal taxpayer registration number rpe00845, a person who will be referred to as “The debtor"; and on the other hand, Mr. Romualdo Mendieta Pérez, who declares to be of age with 47 years of age, with his domicile at Ing. Raúl Méndez number 546 Col Contreras, Cuajimalpa Federal District delegation, who declares to be a merchant by profession, meet up to date on tax debts, his federal taxpayer registry is 9853sop5 Mr. Who from now on will be referred to as “El creditor"; Both parties acknowledge their powers to enter into this contract and will be bound by the following statements and clauses:

STATEMENTS:

1. “The debtor” declares to be the owner of a truck; property that is in the total and legal possession and domain of him, property that is guaranteed by the invoice with number 8964 dated January 6, 2011 that guarantees a truck of the Audi brand, model Q7.
2. The debtor declares that the vehicle that he offers as a pledge is free of all encumbrances and up to date with all his payments and contributions; For this, the corresponding documents that support such circumstance will be attached.
3. "The debtor" declares that on August 6 of this year, he received a loan of (250,000 pesos 00/100), a loan that has an agreed 4% interest. The parties agreed to enter into a pledge contract for which the following clauses will be followed:

CLAUSES:

First.- As a guarantee for the debt contracted with "The creditor", the debtor, pledges the articles mentioned in point "A", of the declarations of this contract, which are will be fully available, both for the enjoyment and for the management of "The creditor" during the time it takes to settle said debt, leaving the laws that mark limits.

Second.- "The debtor" grants and delivers the vehicle to "The creditor", leaving "The debtor" completely in agreement that use by "The creditor" and that the expenses are made to maintain said vehicle in good condition optimal.

Third.- The parties agree that the fruits or benefits of the use of this vehicle will be reduced from the interest and debt generated by this pledge contract.

Quarter.- "The debtor" can sell the vehicle that is the object of this contract outside the established term, and to carry out the sale, he must complete the cost of the debt together with the interest on him.

Fifth.- In the event that the vehicle is completely damaged, or is used outside the scope of the law or its nature, it may proceed to deposit it in a third person, who would be chosen after agreement by both parts.

In the event that there is greater damage to said vehicle, a bond may be posted to guarantee it.

Seventh.- In the event that the debt is not paid within the established period, "The creditor" may publicly dispose of to restore the value of the corresponding debt and, if applicable, restore the excess cost to "The debtor" not without first covering the alternative expenses and costs judicial.

Eighth.- The debtor party renounces the jurisdiction that corresponds to it by law because it is in residence in the State of Mexico, and will be subject to the jurisdiction and laws of Mexico City, District Federal.

After reading this contract to the parties, and being fully compliant with it, it is signed, with a witness for each of the parties, who will sign this contract.

Three copies will be made, of which the parties will keep one and the third may be kept by a person fully accepted by the parties.

After identifying the witnesses, this pledge contract is signed.

Mexico Federal District, August 15, 2012

"The debtor" "The creditor"
Signature Signature

Witness Witness
Signature Signature