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CHANGE OF DIRECTORS / APPOINTMENT
OF ADMINISTRATOR
On the management being taken over, the secured creditor can change
the directors of borrower company if borrower is a company and appoint
administrator if borrower is not a company. A notice to the effect
is also published in the newspaper.
On publishing of such notice, the earlier directors (in case of
a company) and persons holding any office of power of superintendence
(if borrower is not a company) shall be deemed to have vacated their
office.
Any contract of management, which borrower had with any director
or manager of borrower holding office shall be deemed to be terminated.
The new directors/administrator appointed by secured creditor will
take over in custody or control all the property, effects or actionable
claims to which the business of the borrower is entitled.
The new directors/administrator shall alone be entitled to exercise
all the powers of superintendence, direction and control of business
of borrower.
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