Singapore legislation
Clause 268
Clause 268
Obligations of borrowing corporation
(1)
Where there is a trustee for the holders of any debentures of a borrowing corporation, the directors of the borrowing corporation shall —
at the end of a period not exceeding 3 months ending on a day (being a day after the date of the issue of the relevant prospectus) which the trustee is hereby required to notify the borrowing corporation in writing; and
at the end of each succeeding period thereafter, being a period of 3 months or such shorter time as the trustee may, in any special circumstances allow,prepare a report that relates to that period and complies with the requirements of subsection (2) and within one month after the end of each such period lodge a copy of the report relating to that period with the Authority and with the trustee.
(2)
The report referred to in subsection (1) shall be signed by not less than 2 of the directors on behalf of all of them and shall set out in detail any matters adversely affecting the security or the interests of the holders of the debentures and, without affecting the generality of subsection (1), shall state —
whether or not the limitations on the amount that the corporation may borrow have been exceeded;
whether or not the borrowing corporation and each of its guarantor corporations have observed and performed all the covenants and provisions binding upon them respectively by or pursuant to the debentures or any trust deed;
whether or not any event has happened which has caused or could cause the debentures or any provision of the relevant trust deed to become enforceable and, if so, particulars of that event;
whether or not any circumstances affecting the borrowing corporation, its subsidiaries or its guarantor corporations or any of them have occurred which materially affect any security or charge included in or created by the debentures or any trust deed and, if so, particulars of those circumstances;
whether or not there has been any substantial change in the nature of the business of the borrowing corporation or any of its subsidiaries or any of its guarantor corporations since the debentures were first issued to the public which has not previously been reported upon as required by this section and, if so, particulars of that change; and
where the borrowing corporation has deposited money with or lent money to or assumed any liability of a corporation which is related to the borrowing corporation, particulars of —
the total amounts so deposited or loaned and the extent of any liability so assumed during the period covered by the report; and (ii)the total amounts owing to the borrowing corporation in respect of money so deposited or loaned and the extent of any liability so assumed as at the end of the period covered by the report, distinguishing between deposits, loans and assumptions of liabilities which are secured and those which are unsecured, but not including any deposit with or loan to or any liability assumed on behalf of a corporation if that corporation has guaranteed the repayment of the debentures of the borrowing corporation and has secured the guarantee by a charge over its assets in favour of the trustee for the holders of the debentures of the borrowing corporation.
(3)
Any person who fails to comply with subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $20,000 and, in the case of a continuing offence, to a further fine not exceeding $2,000 for every day or part thereof during which the offence continues after conviction.
(4)
Where there is a trustee for the holders of any debentures issued by a borrowing corporation, the borrowing corporation and each of its guarantor corporations which has guaranteed the repayment of the moneys raised by the issue of those debentures shall, whether or not any demand therefor has been made —
in writing furnish the trustee, within 21 days after the creation of the charge, with the particulars of any charge created by the corporation or the guarantor corporation, as the case requires; and
when the amount to be advanced on the security of the charge is indeterminate, in writing furnish the trustee, within 7 days after the advance, with particulars of the amount or amounts in fact advanced.
(5)
Where any such advance referred to in subsection (4)(b) is merged in a current account with bankers or trade creditors, it shall be sufficient for particulars of the net amount outstanding in respect of any such advance to be furnished every 3 months.
(6)
The directors of every borrowing corporation and of every guarantor corporation shall cause to be made out and lodged with the Authority and with the trustee for the holders of the debentures, if any —
a profit and loss account for the first 6 months of every financial year of the corporation and a balance-sheet as at the end of that period, not later than 3 months after the expiration of the period of 6 months; and
a profit and loss account for every financial year of the corporation and a balance-sheet as at the end of that period, not later than 5 months after the expiration of that financial year.
(7)
Any person who fails to comply with subsection (6) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $15,000 and, in the case of a continuing offence, to a further fine not exceeding $1,000 for every day or part thereof during which the offence continues after conviction.
(8)
Section 201(4) to (7) and (11) to (16) and section 207(1), (2) and (7) of the Companies Act (Cap. 50), shall, with such adaptations as are necessary, be applicable to every profit and loss account and balance-sheet made out and lodged under subsection (6) as if that profit and loss account and balance-sheet were a profit and loss account and balance-sheet referred to in those sections.
(9)
Where —
the directors of a borrowing corporation do not lodge with the trustee for the holders of debentures a report as required by subsection (1); or
the directors of a borrowing corporation or the directors of a guarantor corporation do not lodge with the trustee the balance-sheets and profit and loss accounts as required by subsection (6) within the time prescribed,the trustee shall forthwith lodge notice of that fact with the Authority.
(10)
Notwithstanding anything in subsection (8), a profit and loss account and balance-sheet of a borrowing corporation or its guarantor corporation required to be made out and lodged in accordance with subsection (6) —
need not be audited; or
the audit thereof may be of a limited nature or extent,if the trustee for the holders of the debentures of the borrowing corporation has, by notice in writing, consented to the audit being dispensed with or being of a limited nature or extent, as the case may be.
(11)
Where the trustee has by notice in writing given his consent under subsection (10), the directors of the borrowing corporation, or the directors of the guarantor corporation, in respect of whose profit and loss account and balance-sheet the notice was given, shall lodge with the Authority a copy of the notice at the time when the profit and loss account and balance-sheet to which the notice relates are lodged with the Authority.
(12)
Notwithstanding anything in this section, a profit and loss account and balance-sheet of a borrowing corporation or its guarantor corporation required to be made out and lodged in accordance with subsection (6) may, unless the trustee for the holders of the debentures of the borrowing corporation otherwise requires in writing, be based upon the value of the stock in trade of the borrowing corporation or the guarantor corporation, as the case may be, as reasonably estimated by the directors of the borrowing corporation or guarantor corporation.
(13)
The estimation of the directors referred to in subsection (12) shall be made on the basis of the values of such stock in trade as adopted for the purpose of the profit and loss account and balance-sheet of that corporation laid before the corporation at its last preceding annual general meeting and certified in writing by the directors as such.
(14)
In this section, a reference to a director of a borrowing corporation, in a case where the borrowing corporation is not a corporation, shall be read as a reference to such person of the borrowing corporation as the Authority may approve by notice in writing.