
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 15USC77ooo]

 
                      TITLE 15--COMMERCE AND TRADE
 
               CHAPTER 2A--SECURITIES AND TRUST INDENTURES
 
                    SUBCHAPTER III--TRUST INDENTURES
 
Sec. 77ooo. Duties and responsibility of the trustee


(a) Duties prior to default

    The indenture to be qualified shall automatically be deemed (unless 
it is expressly provided therein that any such provision is excluded) to 
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 the indenture trustee shall examine the evidence furnished to it 
pursuant to section 77nnn of this title to determine whether or not such 
evidence conforms to the requirements of the indenture.

(b) Notice of defaults

    The indenture trustee shall give to the indenture security holders, 
in the manner and to the extent provided in subsection (c) of section 
77mmm of this title, notice of all defaults known to the trustee, within 
ninety days after the occurrence thereof: Provided, That such indenture 
shall automatically be deemed (unless it is expressly provided therein 
that such provision is excluded) to provide that, except in the case of 
default in the payment of the principal of or interest on any indenture 
security, or in the payment of any sinking or purchase fund installment, 
the trustee shall be protected 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.

(c) Duties of the trustee in case of default

    The indenture trustee shall 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.

(d) Responsibility of the trustee

    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 shall automatically be deemed (unless it is 
    expressly provided therein that any such provision is excluded) to 
    contain the provisions authorized by paragraphs (1) and (2) of 
    subsection (a) of this section;
        (2) such indenture shall automatically be deemed (unless it is 
    expressly provided therein that any such provision is excluded) to 
    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 ascertaining the pertinent facts; and
        (3) such indenture shall automatically be deemed (unless it is 
    expressly provided therein that any such provision is excluded) to 
    contain provisions protecting the indenture trustee with respect to 
    any action taken or omitted to be taken by it in good faith in 
    accordance with the direction of the holders of not less than a 
    majority in principal amount of the indenture securities at the time 
    outstanding (determined as provided in subsection (a) of section 
    77ppp of this title) relating to the time, method, and place of 
    conducting any proceeding for any remedy available to such trustee, 
    or exercising any trust or power conferred upon such trustee, under 
    such indenture.

(e) Undertaking for costs

    The indenture to be qualified shall automatically be deemed (unless 
it is expressly provided therein that any such provision is excluded) to 
contain provisions to the effect that all parties thereto, including the 
indenture security holders, agree that the court may in its discretion 
require, in any suit for the enforcement of any right or remedy under 
such indenture, or in any suit against the trustee for any action taken 
or omitted by it as trustee, the filing by any party litigant in such 
suit of an undertaking to pay the costs of such suit, and that such 
court may in its discretion assess reasonable costs, including 
reasonable attorney's fees, against any party litigant in such suit, 
having due regard to the merits and good faith of the claims or defenses 
made by such party litigant: Provided, That the provisions of this 
subsection shall not apply to any suit instituted by such trustee, to 
any suit instituted by any indenture security holder, or group of 
indenture security holders, holding in the aggregate more than 10 per 
centum in principal amount of the indenture securities outstanding, or 
to any suit instituted by any indenture security holder for the 
enforcement of the payment of the principal of or interest on any 
indenture security, on or after the respective due dates expressed in 
such indenture security.

(May 27, 1933, ch. 38, title III, Sec. 315, as added Aug. 3, 1939, ch. 
411, 53 Stat. 1171; amended Pub. L. 101-550, title IV, Sec. 414, Nov. 
15, 1990, 104 Stat. 2730.)


                               Amendments

    1990--Subsec. (a). Pub. L. 101-550, Sec. 414(1), (2), substituted 
``The indenture to be qualified shall automatically be deemed (unless it 
is expressly provided therein that any such provision is excluded) to'' 
for ``The indenture to be qualified may'' and ``the indenture trustee 
shall examine'' for ``such indenture shall contain provisions requiring 
the indenture trustee to examine''.
    Subsec. (b). Pub. L. 101-550, Sec. 414(3), (4), substituted ``The 
indenture trustee shall'' for ``The indenture to be qualified shall 
contain provisions requiring the indenture trustee to'' and ``That such 
indenture shall automatically be deemed (unless it is expressly provided 
therein that such provision is excluded) to'' for ``That such indenture 
may''.
    Subsec. (c). Pub. L. 101-550, Sec. 414(3), substituted ``The 
indenture trustee shall'' for ``The indenture to be qualified shall 
contain provisions requiring the indenture trustee to''.
    Subsec. (d)(1) to (3). Pub. L. 101-550, Sec. 414(5), substituted 
``such indenture shall automatically be deemed (unless it is expressly 
provided therein that any such provision is excluded) to'' for ``such 
indenture may''.
    Subsec. (e). Pub. L. 101-550, Sec. 414(1), substituted ``The 
indenture to be qualified shall automatically be deemed (unless it is 
expressly provided therein that any such provision is excluded) to'' for 
``The indenture to be qualified may''.

                  Section Referred to in Other Sections

    This section is referred to in sections 77jjj, 77kkk, 77mmm, 77rrr 
of this title.
