§ 14-235-219 - Securing of bonds by trust indenture.
14-235-219. Securing of bonds by trust indenture.
(a) (1) In the discretion of the municipal council or sewer committee, bonds issued under this subchapter may be secured by a trust indenture by and between the municipality and a corporate trustee, which may be any domestic or nonresident trust company or bank having the powers of a trust company.
(2) The trust indenture may convey or mortgage the works or any part of it.
(b) The ordinance authorizing the revenue bonds and fixing the details of it may provide that the trust indenture may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable and proper, not in violation of law, including covenants setting forth the duties of the municipality and the committee in relation to the construction or acquisition of the works and the improvement, operation, repair, maintenance, and insurance of them, and the custody, safeguarding, and application of all moneys, and may provide that the works shall be contracted for, constructed, and paid for under the supervision and approval of consulting engineers employed or designated by the committee and satisfactory to the original bond purchasers, successors, assigns, or nominees. The bond purchasers, etc. may be given the right to require that the security given by contractors and by any depository of the proceeds of bonds or revenues of the works or other moneys pertaining to them be satisfactory to the purchasers, successors, assigns, or nominees.
(c) The indenture may set forth the rights and remedies of the bondholders or the trustee, restricting the individual right of action of bondholders as is customary in trust indentures securing bonds and debentures of corporations.
(d) Except as otherwise provided in this subchapter, the council or committee may provide by ordinance, or in the trust indenture, for the payment of the proceeds of the sale of the bonds and the revenues of the works to such officer, board, or depository as it may determine for the custody of them and for the method of disbursement of them, with such safeguards and restrictions as it may determine.