Singapore legislation
Section 266
Section 266
Duties of trustees
(1)
A trustee for the holders of debentures must —
at all times exercise due diligence and vigilance in carrying out its functions and duties, and in safeguarding the rights and interests of the holders of debentures;
ensure that it has the ability and powers to perform all of its duties as set out in the trust deed;
ensure that any trustee appointed for the holders of any collateral upon which the debentures are secured is subject to duties that are at least equivalent to those imposed under paragraphs (a) and (b); and
comply with such other requirements as the Authority may prescribe by regulations made under section 341, or as the Authority may impose in respect of any particular offer or transaction relating to the debentures.
(2)
Where, after due inquiry, the trustee for the holders of debentures at any time is of the opinion that the assets of the borrowing entity and of any of its guarantor entities which are or should be available whether by way of security or otherwise, are insufficient, or likely to become insufficient, to discharge the principal debt as and when it becomes due, the trustee may apply to the Authority for an order under this subsection.
(3)
The Authority, on such application —
after giving the borrowing entity an opportunity of making representations in relation to that application, by written order served on the entity at its registered office in Singapore, may impose such restrictions on the activities of the borrowing entity, including restrictions on advertising for deposits or loans and on borrowing by the entity as the Authority thinks necessary for the protection of the interests of the holders of the debentures; or
may, and if the borrowing entity so requires, must direct the trustee to apply to the court for an order under subsection (5); and the trustee must apply accordingly.
(4)
Where —
after due inquiry, the trustee at any time is of the opinion that the assets of the borrowing entity and of any of its guarantor entities which are or should be available, whether by way of security or otherwise, are insufficient or likely to become insufficient, to discharge the principal debt as and when it becomes due; or
the borrowing entity has contravened an order made by the Authority under subsection (2),the trustee may, and where the borrowing entity has requested the trustee to do so, must apply to the court for an order under subsection (5).
(5)
Where an application is made to the court under subsection (3) or (4), the court may, after giving the borrowing entity an opportunity to be heard, by order, do all or any of the following things:
direct the trustee to convene a meeting of the holders of the debentures for the purpose of placing before them such information relating to their interests and such proposals for the protection of their interests as the trustee considers necessary or appropriate, and of obtaining their directions in relation thereto and give such directions in relation to the conduct of the meeting as the court thinks fit;
stay all or any actions or proceedings before any court by or against the borrowing entity;
restrain the payment of any moneys by the borrowing entity to the holders of debentures of the borrowing entity or to any class of such holders;
appoint a receiver of such of the property as constitutes the security (if any) for the debentures;
give such further directions from time to time as may be necessary to protect the interests of the holders of the debentures, the members of the borrowing entity or any of its guarantor entities or the public,but in making any such order the court must have regard to the rights of all creditors of the borrowing entity.
(6)
The court may vary or rescind any order made under subsection (5) as the court thinks fit.
(7)
A trustee in making any application to the Authority or to the court must have regard to the nature and kind of the security given when the offer of the debentures was made, and if no security was given must have regard to the position of the holders of the debentures as unsecured creditors of the borrowing entity.
(8)
A trustee may rely upon any certificate or report given or statement made by any advocate and solicitor, auditor or officer of the borrowing entity or guarantor entity if it has reasonable grounds for believing that such advocate and solicitor, auditor or officer was competent to give or make the certificate, report or statement.