Section 6: Duties of debenture holders’ representative

6. Duties of debenture holders’ representative (1) Every debenture holders’ representative shall— (a) exercise reasonable diligence to ascertain whether or not the borrowing company has committed a breach of the terms and conditions of the agency deed; (b) except where he is satisfied that the breach will not materially prejudice any security conferred by the deed or the interests of the debenture holders, do all such things as he is empowered to do to cause the borrowing company to remedy a breach of those terms and conditions; (c) exercise reasonable diligence to ascertain whether or not the assets of the borrowing company that are or may be available, whether by way of security or otherwise, are sufficient or likely to be sufficient to discharge the amounts of the debentures as they become due; (d) hold for the benefit of the debenture holders, and account to them for, any money or property coming into his hands by way of payment of principal or interest under the agency deed or on a realisation of the security conferred by the deed. C35 – 229 [Issue 1] Companies Act (2) Where, after due inquiry, a debenture holders’ representative is of the opinion that the assets of the company are insufficient or likely to be insufficient to discharge the amounts of the debentures as they become due, he may, having regard to— (a) any other powers or remedies available to him for the protection of the interests of the debenture holders; (b) the availability, by way of security or otherwise, of any assets of any corporation that has guaranteed or agreed to guarantee the repayment of the amounts of the debentures; (c) the possible effects on the borrowing company’s affairs of any application to the Court under this paragraph; and (d) all other relevant circumstances, apply to the Court for an order under subparagraph (3). (3) On an application for an order under this subparagraph, the Court may, after giving the borrowing company an opportunity of being heard, and having regard to the rights of all creditors of the borrowing company, give such directions as it thinks fit to protect the interests of the debenture holders, the members of the borrowing company, or the public, whether by way of— (a) staying any proceedings by or against the borrowing company; (b) restraining the payment by it of any money to any holders of debentures or to any class of such holders; or (c) appointing a receiver of such of its property as constitutes the security for the debentures, or otherwise.