Quick Answer: Who Is Known As Debenture Trustee?

Who can be a debenture holder?

Debentures are part of loan.

A shareholder or member is the joint owner of a company; but a debenture holder is only a creditor of the company.

Shareholders are invited to attend the annual general meeting of the company.

Debenture holders are not invited, unless any decision affecting their interest is taken..

What debenture means?

A debenture is a type of debt instrument that is not backed by any collateral and usually has a term greater than 10 years. Debentures are backed only by the creditworthiness and reputation of the issuer. Both corporations and governments frequently issue debentures to raise capital or funds.

Can a trust issue debentures?

Any provision contained in a trust deed for securing the issue of debentures, or in any contract with the debenture-holders secured by a trust deed, shall be void in so far as it would have the effect of exempting a trustee thereof from, or indemnifying him against, any liability for breach of trust, where he fails to …

Can a company issue unsecured debentures?

Yes, private companies can issue NCD of both types (secured and unsecured), however, they cannot issue debentures carrying voting rights. If the private company is issuing secured NCDs, it must fulfill the criteria prescribed by SEBI for issuing such an instrument.

Can private company issue debentures to public?

A private company can convert loans raised or debentures issued by the company into shares by passing a special resolution if there is such condition attached to the debentures issued or loan raised so as to convert the said debentures or loans into equity shares in the company as given under Section 62(3).

Can a listed company issue unlisted debentures?

16 March 2010 can a listed company issue unlisted non convertible debentures to a bank on private placement basis……….? … You will have to file the Information memorandum and the Listing Application Form duly filled for listing of debentures. In case you require any other details, please state.

What are the rights of debenture holders?

Rights as a Debenture HolderTo receive interest / redemption in due time.To receive a copy of the trust deed on request.To apply for winding up of the company if the company fails to pay its debt.To approach the Debenture Trustee with your grievance, if any.

What are unsecured debentures?

A debt security, issued by a government or large company, that is not secured by an asset or lien, but rather by the all issuer’s assets not otherwise secured. … Some unsecured bonds, such Treasury securities, are considered risk-free. See also: Debenture.

Are there any debentures on which interest is not payable?

Interest on Debentures is a charge against the profit of the company. We calculate Interest on Debentures at a fixed rate of interest on the nominal value. Interest is not payable on debentures issued as collateral security.

Who is a debenture trustee?

Debenture trustee is a person who safeguards the interest of debenture holders and serves as a liaison between the issuer company and the debenture holders. … Issue of unlisted secured debentures on private placement basis to selected group of persons; and.

Can NBFC issue unsecured debentures?

Under the existing regime, unsecured bonds are treated as public deposits and hence, debentures issued by NBFCs had to necessarily be secured and issued as per section 71 of the Companies Act, 2013 and rules made thereunder. … The revised guidelines are not applicable to tax exempt bonds offered by NBFCs.

What are the different types of debentures?

Companies use debentures when they need to borrow the money at a fixed rate of interest for its expansion. Secured and Unsecured, Registered and Bearer, Convertible and Non-Convertible, First and Second are four types of Debentures. Let us learn more about Debentures in detail.

Why is Debenture Trustee required?

A debenture trustee has various duties to perform viz. To ensure there is no breach in terms of the issue of debentures. To ensure that all conditions regarding the creation of debentures are met. To take the required steps to meet debenture holder obligations in case of a breach.

Can one person company issue debentures?

Yes, but not in the form of shares. An OPC can raise fund for the company through debt like taking loans from the bank or any financial institutions or by issuing debentures or deposits. But OPC cannot issue debenture which is fully or partial convertible debenture.

Can debentures be listed?

The government on Sunday said private companies which list non-convertible debentures (NCDs) on stock exchanges will not to be regarded as listed companies. The government on Sunday said private companies which list non-convertible debentures (NCDs) on stock exchanges will not to be regarded as listed companies.