organising dialogue with investors.
General meetings and written resolutions: giving bondholders a voice
Bond issues do not require bondholders to be convened annually at a general meeting, as is the case for shareholders of a company.
However, it may be necessary for the borrowing company to consult bondholders so that they can vote on requests to amend the documentation, in the event of non-compliance with commitments made or in the event of exceptional circumstances arising during the life of a bond issue.
These collective decisions may take the form of general meetings or written decisions.
A general meeting may be convened at the request of the bond issuer, the representative of the bondholders or by bondholders representing 1/30th of the total amount of the issue.
The centralising agent coordinates the various administrative, technical and legal steps necessary to enable this meeting to be held and to ensure that votes are collected in accordance with the legal framework.
Main duties of the centralising agent:
- Convene bondholders (upon first call and second call) in accordance with the terms and conditions set out in the issue agreement and the French Commercial Code.
- Convene the representative of the bondholders.
- Send bondholders and financial intermediaries the documents required to attend in person or appoint a proxy to vote by post (single participation form).
- Centralise the responses from the various financial intermediaries and bondholders with their proof of ownership (certificate of position).
- Participate in the general meeting by determining the quorum, the results of the votes on the resolutions and drafting the minutes of the meeting.
Better understanding of its investor base
Understanding who holds its bond securities at any given time has become a strategic issue for issuers. In a market where investors change frequently, it is no longer enough to know the initial subscribers: it is now essential to have up-to-date and reliable information on the actual composition of the investor base.
DIIS Group offers a bondholder identification service that provides, at regular intervals or during specific events, an accurate and reliable snapshot of bondholders at a given moment.
This visibility is a strategic asset for strengthening investor relations, anticipating refinancing issues and meeting regulatory requirements.