Section 211 CAMA 2020
Trustees for debenture holders
(1) Whether or not a debenture is secured by a charge over the company’s property, there may be created in relation to such debenture, a trust deed appointing trustees for the debenture holders.
(2) It is the duty of such trustee to safeguard the rights of the debenture holders and, on behalf of and for the benefit of the debenture holders, exercise the rights, powers and discretions conferred upon him by the trust deed.
(3) Charges securing the debentures may be created in favour of the debenture holders by vesting them in the trustees.
(4) Any provision contained in a trust deed or in any contract with the holders of debentures secured by a trust deed is void if it would have the effect of exempting a trustee from, or indemnifying him against, liability for any breach of trust or failure to show the degree of care and diligence required of him as trustee having regard to the powers, authorities or discretions conferred on him by the trust deed.
(5) In subsection (4), nothing is deemed to invalidate any release otherwise validly given in respect of anything done or omitted to be done by a trustee on the agreement to such release of a majority of at least three quarters in value of the debenture holders present in person, or where proxies are permitted, by proxy at a meeting summoned for the purpose.
(6) Notwithstanding any provision contained in the debentures or trust deed, the Court may, on the application of any debenture holder or of the Commission, remove any trustee and appoint another in his place if satisfied that such trustee has interests which conflicts or may conflict with those of the debenture holders or that for any reason it is undesirable that such trustee should continue to act :
Provided that where any such application is made by a debenture holder, the Court if it deems fit, may order the applicant to give security for the payment of the costs of the trustee and may direct that the application be heard in Chambers.
