Page:United States Statutes at Large Volume 53 Part 2.djvu/695

 53 STAT.] 76TH CONG. , IST SESS.-CH. 411-AUG. 3, 1939 obligor upon the indenture securities shall furnish to the indenture trustee any other evidence of compliance with the conditions and covenants provided for in the indenture than the evidence specified in this section, or as preventing the inclusion of such provisions in such indenture, if the parties so agree. "'DUTIES AND RESPONSIBILITY OF THE TRUSTEE "Duties Prior to Default "SEc. 315. (a) The indenture to be qualified may provide that, prior to default (as such term is defined in such indenture)- "(1) the indenture trustee shall not be liable except for the performance of such duties as are specifically set out in such indenture; and "(2) the indenture trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, in the absence of bad faith on the part of such trustee, upon certificates or opinions conforming to the requirements of the indenture; but such indenture shall contain provisions requiring the indenture trustee to examine the evidence furnished to it pursuant to section 314 to determine whether or not such evidence conforms to the requirements of the indenture. "Notice of Defaults "(b) The indenture to be qualified shall contain provisions requir- ing the indenture trustee to give to the indenture security holders, in the manner and to the extent provided in subsection (c) of section 313, notice of all defaults known to the trustee, within ninety days after the occurrence thereof: Provided, That such indenture may provide that, except in the case of default in the payment of the prin- cipal of or interest on any indenture security, or in the payment of any sinking or purchase fund installment, the trustee shall be pro- tected in withholding such notice if and so long as the board of directors, the executive committee, or a trust committee of directors and/or responsible officers, of the trustee in good faith determine that the withholding of such notice is in the interests of the indenture security holders. "Duties of the Trustee in Case of Default "(c) The indenture to be qualified shall contain provisions requir- ing the indenture trustee to exercise in case of default (as such term is defined in such indenture) such of the rights and powers vested in it by such indenture, and to use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. "Responsibility of the Trustee "(d) The indenture to be qualified shall not contain any provisions relieving the indenture trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that- "(1) such indenture may contain the provisions authorized by paragraphs (1) and (2) of subsection (a) of this section; "(2) such indenture may contain provisions protecting the indenture trustee from liability for any error of judgment made in good faith by a responsible officer or officers of such trustee, unless it shall be proved that such trustee was negligent in ascer- taining the pertinent facts; and 1171 Trustee's duties pri- or to default. Notice of defaults. Proviso. Conditions for with- holding. Duties of the trus- tee in case of default. Liability for negli- gence, etc. Exceptions.

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