Section 71 of The Companies Act, 2013
Documents and Intimation to Debenture Trustees.
56.(1) The listed entity shall forward the following to the debenture trustee promptly:
(a) a copy of the annual report at the same time as it is issued along with a copy of certificate from the listed entity’s auditors in respect of utilisation of funds during the implementation period of the project for which the funds have been raised:
Provided that in the case of debentures or preference shares issued for financing working capital or general corporate purposes or for capital raising purposes the copy of the auditor’s certificate may be submitted at the end of each financial year till the funds have been fully utilised or the purpose for which these funds were intended has been achieved.
(b) a copy of all notices, resolutions and circulars relating to-
(i) new issue of non convertible debt securities at the same time as they are sent to shareholders/ holders of non convertible debt securities;
(ii) the meetings of holders of non-convertible debt securities at the same time as they are sent to the holders of non convertible debt securities or advertised in the media including those relating to proceedings of the meetings;
(c)intimations regarding :
(i) any revision in the rating;
(ii) any default in timely payment of interest or redemption or both in respect of the non convertible debt securities;
(iii) failure to create charge on the assets;
All covenants of the issue (including side letters, accelerated payment clause, etc.)
regarding maintenance of hundred percent asset cover or asset cover as per the terms of offer document/ Information Memorandum and/or Debenture Trust Deed, including compliance with all the covenants, in respect of listed non-convertible debt securities, by the statutory auditor, along with the half-yearly financial results:
Provided that the submission of half yearly certificate is not applicable where bonds are secured by a Government guarantee.
(d) a half-yearly certificate regarding maintenance of hundred percent. asset cover in respect of listed non convertible debt securities, by either a practicing company secretary or a practicing chartered accountant, along with the half yearly financial results:
Provided that submission of such half yearly certificates is not applicable in cases where a listed entity is a bank or non banking financial companies registered with Reserve Bank of India or where bonds are secured by a Government guarantee.
The listed entity shall also disclose to the Debenture Trustee at the same time as it has intimated to the stock exchange, all material events and/or information as disclosed under regulation 51of these regulations in so far as it relates to the interest, principal, issue and terms of non-convertible debt securities, rating, creation of charge on the assets, notices, resolutions and meetings of holders of non-convertible debt securities
(2) The listed entity shall forward to the debenture trustee any such information sought and provide access to relevant books of accounts as required by the debenture trustee.
(3) The listed entity may, subject to the consent of the debenture trustee, send the information stipulated in sub-regulation (1), in electronic form/fax.
- Refer SEBI Master circular for Debenture trustees updated as on 06.07.2023 for the manner of preparation of security cover certificate by the Issuer. The obligations of the Issuer and the Debenture Trustee with respect to preparation and submission of security cover certificate are given thereunder. To view the Circular, Click here.
- Refer SEBI Circular dated 19.05.2022 for revised format on Security Cover. To view circular, Click Here