Answer in brief.
(1) Which are the precautions to be taken by the Secretary while corresponding with debenture holders ?
Ans. Following precautions to be taken by the secretary while corresponding with the debenture holders. The following precautions taken by secretary while corresponding with debenture holders are as follows:
(1) Correct or Precise Information: The letter acts as a representative of the organization. Secretary should always provide correct, up to date and factual information to the debenture holders in precise and compact manner. Utmost care should be taken by secretary while giving facts and figures to debenture holders.
(2) Legal provisions: The Secretary must keep in mind legality of content in correspondence with the debenture holders. While corresponding with the debenture holders, secretary should compulsorily follow relevant provisions of the Companies Act, 2013 with latest amendments and other relevant laws.
(3) Image of the company: While drafting the letters, secretary has to try his best to remove their doubts, queries and difficulties in a polite and courteous manner. It is helpful for getting favourable response and build up goodwill of the organization.
(4) Prompt Reply: In any correspondence prompt reply is very important. The company Secretary must give prompt replies to any queries of the debenture holders. Secretary should provide quick reply to complaint letters without any delay to the debenture holders.
(5) Secrecy: The secrecy of any business is essential. The Secretary must keep secrecy regarding the affairs of the company while corresponding with the debenture holders and shall not disclose any confidential matter of the Company. Secrecy is important so that no other party can take undue advantage of it.
(6) Courtesy: The letter to the debenture holders should be polite. A courteous letter shows empathy, respect and mutual understanding. It is helpful for getting favourable response and build up goodwill of the organization. Secretary should not use any harsh words while corresponding with debenture holders. Also, rude language should be avoided.
(7) Transparency: While corresponding with debenture holders, secretary must maintain transparency. To maintain greater transparency it is – necessary to disclose all correct and accurate information of the company. Secretary should provide true and actual or real facts of the company in correspondence.
(8) Conciseness: The letter acts as a representative of the organization. Thus, secretary should always provide all the information in concise or compact manner. Correspondence with the debenture holders must be brief and to the point. A letter should not be lengthy. Secretary should provide maximum information in minimum words.
(2) What are the circumstances under which correspondence can be made with debenture holders ?
Ans: Following are the circumstances under which secretary has to enter into correspondence with debenture holders:
(1) Informing the applicant about allotment of debentures.
(2) Informing about the payment of Interest through:
(a) Interest Warrant
(b) Electronic Payment of Interest
(c) Letter for conversion of debentures into equity shares.
(d) Letter for redemption of debentures.