Sec. 42b-3. Public entities authorized to establish system of registered obligations notwithstanding state or local laws. System may provide for certificated or uncertificated obligations or both.
Sec. 42b-3. Public entities authorized to establish system of registered obligations notwithstanding state or local laws. System may provide for certificated or
uncertificated obligations or both. (a) Notwithstanding the provisions of the general
statutes or any special act, any municipal charter or home rule ordinance or any local
law requiring the issuance of bonds in bearer form or with coupons attached, each issuer
is authorized to establish and maintain a system of registration with respect to each
obligation which it issues. The system may either be: (1) A system pursuant to which
only certificated registered public obligations are issued; (2) a system pursuant to which
only uncertificated registered public obligations are issued; or (3) a system pursuant to
which both certificated and uncertificated registered public obligations are issued. The
issuer may amend, discontinue and reinstitute any system, from time to time, subject
to covenants.
(b) The system shall be established, amended, discontinued or reinstituted for the
issuer by, and shall be maintained for the issuer as provided by, the official or official
body.
(c) The system shall be described in the registered public obligation or in the official
actions which provide for original issuance of the registered public obligation and in
subsequent official actions providing for amendments and other matters from time to
time. Such description may be by reference to a program of the issuer which is established
by the official or official body.
(d) The system shall define the method or methods by which transfer of the registered public obligation shall be effective with respect to the issuer and by which payment
of principal and any interest shall be made. The system may permit the issuance of
registered public obligations in any denomination to represent several registered public
obligations of smaller denominations. The system may also provide for the form of any
certificated registered public obligation or of any writing relating to an uncertificated
registered public obligation, for identifying numbers or other designations, for a sufficient supply of certificates for subsequent transfers, for record and payment dates, for
varying denominations, for communications to holders or owners of obligations and
for accounting, cancelled certificate destruction, registration and release of security
interests and other incidental matters. Unless the issuer otherwise provides, the record
date for interest payable on the first or fifteenth days of a month shall be the fifteenth
day or the last business day of the preceding month, respectively, and for interest payable
on other than the first or fifteenth days of a month, shall be the fifteenth calendar day
before the interest payment date.
(e) Under a system pursuant to which both certificated and uncertificated registered
public obligations are issued, both types of registered public obligations may be regularly
issued, or one type may be regularly issued and the other type issued only under described
circumstances or to particular described categories of owners, and provision may be
made for registration and release of security interests in registered public obligations.
(f) The system may include covenants of the issuer as to amendments, discontinuances and reinstitutions of the system and the effect of such on the exemption of interest
from the income tax provided for by the code.
(g) Whenever an issuer shall issue an uncertificated registered public obligation,
the system of registration may provide that a true copy of the official actions of the
issuer relating to such uncertificated registered public obligation be maintained by the
issuer or by the person, if any, maintaining such system on behalf of the issuer, as long
as the uncertificated registered public obligation remains outstanding and unpaid. A
copy of such official actions, verified to be such by an authorized officer, shall be admissible before any court of record, administrative body or arbitration panel without further
authentication.
(h) Nothing in this chapter shall preclude a conversion from one of the forms of
registered public obligations provided for by this chapter to a form of obligation not
provided for by this chapter if interest on the obligation so converted will continue to
be exempt from the income tax provided for by the code.
(i) The rights provided by other laws with respect to obligations in forms not provided for by this chapter shall, to the extent not inconsistent with this chapter, apply
with respect to registered public obligations issued in forms authorized by this chapter.
(P.A. 83-519, S. 3, 23; P.A. 06-196, S. 271.)
History: P.A. 06-196 made a technical change in Subsec. (g), effective June 7, 2006.