Regulation 26 - Obligations of debenture trustee - Securities and Exchange Board of India (Issue and Listing of Municipal Debt Securities) Regulations, 2015

CHAPTER VII OBLIGATIONS OF INTERMEDIARIES AND ISSUERS 1 [ Obligations of debenture trustee. 26 . (1) The debenture trustee shall be vested with the requisite powers for protecting the interest of holders of municipal debt securities: Provided that, where the issuer is a body corporate to which the Companies Act, 2013 applies such powers shall include a right to appoint a nominee director on the Board of the issuer, in consultation with institutional holders of such securities. (2) The debenture trustee shall carry out its duties and perform its functions in terms of these regulations, the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993, the trust deed and the offer document/placement memorandum, with due care, diligence and loyalty. (3) The debenture trustee shall monitor the separate escrow account maintained in respect of the earmarked revenue. (4) The debenture trustee shall ensure disclosure of all material events on an ongoing basis. (5) The debenture trustee shall supervise the implementation of the obligations cast in terms of provisions of these regulations. ] ************ NOTES:- 1. Substituted vide NOTIFICATION No. SEBI/LAD-NRO/GN/2019/40 dated 27-09-2019 before it was read as, Obligations of monitoring agency and trustee. 26. (1) The monitoring agency appointed under sub-regulation (7) of regulation 5 shall be vested with the requisite powers for protecting the interest of holders of debt securities. (2) The monitoring agency shall inspect on half yearly basis, the utilization of issue proceeds in accordance with objects of the issue as specified in offer document and report, material deviation, if any, to the concerned stock exchange for public dissemination. (3) The monitoring agency shall monitor earmarked revenue in the separate escrow account. (4) The debenture trustee, wherever appointed, shall be vested with the requisite powers for protecting the interest of holders of debt securities: Provided that , where the issuer is a corporate municipal entity, such powers shall include a right to appoint a nominee director on the Board of the issuer, in consultation with institutional holders of such securities. (5) the debenture trustee, wherever appointed, shall disclose the information to the investors and the general public by issuing a press release in any of the following events: (a) default by issuer to pay interest on debt securities or redemption amount; (b) failure to create a charge on the assets; (c) revision of rating assigned to the debt securities. (6) The debenture trustee, wherever appointed, shall carry out its duties and perform its functions under these regulations, the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993, the trust deed and offer document, with due care, diligence and loyalty. (7) The debenture trustee, wherever appointed, shall ensure disclosure of all material events on an ongoing basis (8) The debenture trustees, wherever appointed, shall supervise the implementation of the conditions regarding creation of security for the debt securities and debenture redemption reserve.