§ 159B-16. Resolution or trust agreement.
§ 159B‑16. Resolution or trust agreement.
In the discretion of the governing board of the issuer, any bondsissued under the provisions of this Chapter may be secured by a trust agreementby and between the issuer and a corporate trustee, which may be any trustcompany or bank having the powers of a trust company within or without theState. Such trust agreement or the resolution providing for the issuance ofsuch bonds may contain such provisions for protecting and enforcing the rightsand remedies of the bondholders and of the trustee as may be reasonable andproper and not in violation of law, and may restrict the individual right ofaction by bondholders. The trust agreement or the resolution providing for theissuance of such bonds may contain covenants including, but not limited to, thefollowing:
(1) The pledge of all or any part of the revenues derived or tobe derived from the project or projects to be financed by the bonds, or fromthe sale or other disposition of power and energy and services and facilitiesrelated to the utilization of power and energy, or from other services oractivities permitted in this Chapter, or from contributions and advances frommembers of a joint agency, or from the electric system or other facilities of amunicipality or a joint agency.
(2) The rents, rates, fees and charges to be established,maintained, and collected, and the use and disposal of revenues, gifts, grantsand funds received or to be received by the municipality or joint agency.
(3) The setting aside of reserves and the investment, regulationand disposition thereof.
(4) The custody, collection, securing, investment, and paymentof any moneys held for the payment of bonds.
(5) Limitations or restrictions on the purposes to which theproceeds of sale of bonds then or thereafter to be issued may be applied.
(6) Limitations or restrictions on the issuance of additionalbonds; the terms upon which additional bonds may be issued and secured; or therefunding of outstanding or other bonds.
(7) The procedure, if any, by which the terms of any contractwith bondholders may be amended, the percentage of bonds the bondholders ofwhich must consent thereto, and the manner in which such consent may be given.
(8) Events of default and the rights and liabilities arising thereupon,the terms and conditions upon which bonds issued under this Chapter shallbecome or may be declared due before maturity, and the terms and conditionsupon which such declaration and its consequences may be waived.
(9) The preparation and maintenance of a budget.
(10) The retention or employment of consulting engineers,independent auditors, and other technical consultants.
(11) Limitations on or the prohibition of free service to anyperson, firm or corporation, public or private.
(12) The acquisition and disposal of property, provided that noproject or part thereof shall be mortgaged by such trust agreement orresolution.
(13) Provisions for insurance and for accounting reports and theinspection and audit thereof.
(14) The continuing operation and maintenance of the project orother facilities.
(15) For bonds that are not issued to pay the cost of a project,the pledge, assignment, mortgage, or grant of a security interest in any realor personal property or interest in real or personal property, including thepledge, assignment, or grant of a security interest in money, rents, charges,or other revenues or proceeds derived by the joint agency from the sale ofproperty, from insurance, or from a condemnation award. In the event of defaulton a bond secured by a pledge, assignment, mortgage, or grant of a securityinterest, the rights of the bond holders and the liabilities arising from thedefault shall be limited, except to the extent provided in a pledge ofrevenues, to the specific property or interest in property pledged, assigned,or mortgaged or in which a security interest was granted to secure the bonds,and no claim for any deficiency shall be made nor any deficiency judgmententered as a result of the pledge, assignment, mortgage, or grant of a securityinterest in the property or the interest in property. (1975, c. 186, s. 1; 1983, c. 574, s. 8; 1991, c. 513,ss. 4, 5; 1995, c. 412, s. 12.)