§ 159-90. Limitations on details of bonds; additional provisions.
§ 159‑90. Limitations on details of bonds; additional provisions.
(a) In fixing the details of revenue bonds, the State or theissuing municipality, as the case may be, shall be subject to the followingrestrictions and directions:
(1) The maturity dates may not exceed the maximum maturityperiods prescribed by the Commission for general obligation bonds pursuant toG.S. 159‑122. For bonds issued in reimbursement of a loan or advance,the maximum maturity period to be used in determining the maturity dates of thebonds shall be the maximum permissible period prescribed by the Commission forthe original project for which the loan or advance was expended, calculatedfrom the date the original project is completed.
(2) Any bond may be made subject to redemption prior tomaturity, including redemption on demand of the holder, with or withoutpremium, on such notice and at such time or times and with such redemptionprovisions as may be stated. When any such bond shall have been validly calledfor redemption and provision shall have been made for the payment of theprincipal thereof, any redemption premium, and the interest thereon accrued tothe date of redemption, interest thereon shall cease.
(3) The bonds may bear interest at such rate or rates, payablesemiannually or otherwise, may be in such denominations, and may be payable insuch kind of money and in such place or places within or without the State ofNorth Carolina, as the State Treasurer or the issuing municipality, as the casemay be, may determine.
(b) In addition to the foregoing provisions of this section, infixing the details of revenue bonds the State or the issuing municipality, asthe case may be, may provide that bonds
(1) May be made payable from time to time on demand or tenderfor purchase by the owner provided a Credit Facility supports such bonds,unless the Commission specifically determines that a Credit Facility is notrequired upon a finding and determination by the Commission that the proposedbonds will satisfy the conditions set forth in G.S. 159‑86(b);
(2) May be additionally supported by a Credit Facility;
(3) May be made subject to redemption prior to maturity, with orwithout premium, on such notice and at such time or times and with suchredemption provisions as may be stated in the bond order or trust agreement orwith such variations as may be permitted in connection with a Par Formulaprovided in such bond order or trust agreement;
(4) May bear interest, notwithstanding the provisions of G.S.159‑125(a), at a rate or rates that may vary as permitted pursuant to aPar Formula and for such period or periods of time, all as may be provided inthe bond order or trust agreement; and
(5) May be made the subject of a remarketing agreement wherebyan attempt is made to remarket the bonds to new purchasers prior to theirpresentment for payment to the provider of the Credit Facility or to theissuing municipality or the State.
No Credit Facility, repayment agreement, Par Formula or remarketingagreement shall become effective without the approval of the Commission.
As used in this subsection, the following terms shall have thefollowing meanings:
"Credit Facility" means an agreement entered into by anissuing municipality or by the State Treasurer on behalf of the State with abank, savings and loan association or other banking institution, an insurancecompany, reinsurance company, surety company or other insurance institution, acorporation, investment banker or other investment institution, or anyfinancial institution providing for prompt payment of all or any part of theprincipal (whether at maturity, presentment for purchase, redemption oracceleration), redemption premium, if any, and interest on any bonds payable ondemand or tender by the owner issued in accordance with this section, inconsideration of the issuing municipality or the State agreeing to repay theprovider of such Credit Facility in accordance with the terms and provisions ofsuch repayment agreement, provided, that any such repayment agreement shallprovide that the obligation of the issuing municipality or the State thereundershall have only such sources of payment as are permitted for the payment ofbonds issued under this Article.
"Par Formula" shall mean any provision or formula adopted bythe issuing municipality or the State to provide for the adjustment, from timeto time, of the interest rate or rates borne by any such bonds so that thepurchase price of such bonds in the open market would be as close to par aspossible. (Ex. Sess. 1938, c.2, s. 5; 1949, c. 1081; 1967, c. 100, s. 1; c. 711, s. 2; 1969, c. 688, s. 1;1971, c. 780, s. 1; 1983, c. 554, s. 11; 1985, c. 265, s. 1; 1991, c. 508, s.4.)