Past version: Effective up to 28 Sep 2011
A trust deed required by Rule 308(5) must include the following provisions:—
(1) A limitation on the amount that the issuer or any guarantor company may borrow. For the purpose of this limitation:—
(a) any advances made by the issuer or any guarantor company to their holding company, or to any of their subsidiaries or their holding company's subsidiaries; and
(b) any investment by the issuer or any guarantor company in the shares of their subsidiaries or their holding company's subsidiaries,
must not be brought into account as an asset unless the company to or in which the advance or investment is made is a guarantor company and covenants with the trustee to limit itself to the same limitation of liabilities as the borrowing company.
(2) A covenant that on request in writing by the trustee, the issuer will cause any wholly-owned subsidiary (whether formed or acquired before or after the date of the Trust Deed) of the issuer to become a guarantor company. The covenant may be qualified, but must provide that the trustee is entitled:—
(a) in the case of secured debentures if the value of the security is or is believed by the trustee to have become less than the principal amount outstanding; or
(b) in the case of debentures or unsecured notes if the ratio limiting the liabilities or borrowing for the purpose of the Trust Deed has been or is believed by the trustee to have been infringed or its maintenance is threatened,
to call upon the issuer to procure any one or more of its subsidiaries (whether formed or acquired before or after the date of the Trust Deed) to become a guarantor company.
(3) The directors of the issuer must prepare a report that relates to each quarter and lodge it with the trustee within one month of the end of the period. The report must be signed by 2 directors and state:
(a) whether or not any limitation of liabilities or borrowings as prescribed by the Trust Deed has been exceeded;
(b) whether or not the issuer and the guarantor company have observed and performed all the covenants and obligations binding upon them respectively pursuant to the Trust Deed;
(c) whether or not any event has happened which has caused or could cause the security created by the Trust Deed to become enforceable;
(d) whether or not any material trading or capital loss has been sustained by the issuer or any guarantor company;
(e) whether or not any circumstances materially affecting the issuer or any guarantor company have occurred which adversely affect the debt securities;
(f) whether any contingent liabilities have been incurred by the issuer or any guarantor company. If so, to state the amount incurred, and whether or not any contingent liability has matured or is likely to mature within the next twelve months, which will materially affect the ability of the issuer or any guarantor company to repay the debt securities;
(g) whether or not there has been any change in any accounting method or method of valuation of assets or liabilities;
(h) whether or not any circumstances have arisen which render adherence to the existing method of valuation of assets or liabilities misleading or inappropriate; and
(i) any substantial change in the nature of the issuer's or any guarantor company's business since the issue of the debt securities.
(4) Within three months of the expiration of the full year and the half year, the issuer must provide the trustee the consolidated profit and loss account and balance sheet (which must be prepared in accordance with the approved accounting standards) of the issuer and of any guarantor company. The accounts relating to the full year must be audited.
(5) The directors shall notify the trustee immediately when they are aware that any condition of the Trust Deed cannot be fulfilled.
(6) A meeting of holders of debt securities must be called on a requisition in writing signed by holders of at least 10% of the nominal amount of the outstanding debt securities.