§ 45-48.1-12 - Payment of bonds and notes.
SECTION 45-48.1-12
§ 45-48.1-12 Payment of bonds and notes.– (a) The principal of premium, if any, and interest on all bonds and notesissued under the provisions of this chapter, unless otherwise provided herein,shall be general obligations of the district or shall be payable solely fromthe funds provided therefor from revenues as herein provided.
(b) In the discretion of the board, any bonds and notesissued hereunder may be secured by a resolution of the board or by a trustagreement between the district and a corporate trustee, which may be any trustcompany or bank having the powers of a trust company within or without thestate, and the trust agreement shall be in a form and executed in a manner asmay be determined by the district. The trust agreement or resolution may pledgeor assign, in whole or in part, the revenues and other moneys held or to bereceived by the district, including the revenues from any facilities alreadyexisting when the pledge or assignment is made, and any contract or otherrights to receive the same, whether then existing or thereafter coming intoexistence and whether then held or thereafter acquired by the district, and theproceeds thereof. The trust agreement or resolution may contain provisions forprotecting and enforcing the rights, security and remedies of the bondholdersor noteholders as may, in the discretion of the district, be reasonable andproper and not in violation of law, including, without limiting the generalityof the foregoing, provisions defining defaults and providing for remedies inthe event thereof which may include the acceleration of maturities andcovenants setting forth the duties of, and limitations on, the district inrelation to the acquisition, construction, improvement, enlargement,alteration, equipping, furnishing, maintenance, use, operation, repair,insurance, and disposition of the water works system, or other property of thedistrict, the custody, safeguarding, investment and application of moneys, theissue of additional or refunding bonds and notes, the fixing, revision andcollection of fees, rates, rents, assessments, or other charges, the use of anysurplus bond and note proceeds, the establishment of reserves, and the makingand amending of contracts.
(c) In the discretion of the board, any bonds or notes issuedunder authority of this chapter, may be issued by the district in the form oflines of credit, loans, or other banking arrangements and under such terms andconditions, not inconsistent with this chapter, and under such agreements withthe purchasers or makers thereof, as the board may determine to be in the bestinterest of the district. In addition to other security provided herein orotherwise by law, bonds or notes issued by the district under any provision ofthis chapter may be secured, in whole or in part, by insurance or letters orlines of credit or other credit facilities, and the district may pledge orassign any of its revenues as security for the reimbursement by the district tothe issuers of such insurance, letters or lines of credit or other creditfacilities of any payments made under the insurance or letters or lines ofcredit or other credit facilities.
(d) It shall be lawful for any bank or trust company to actas a depository or trustee of the proceeds of bonds, notes, revenues, or othermoneys under any trust agreement or resolution and to furnish indemnificationor to pledge securities and issue letters of credit as may be required by thedistrict. Any pledge of revenues or other property made by the district underthis chapter shall be valid and binding and shall be deemed continuouslyperfected from the time when the pledge is made; the revenues, moneys, rightsand proceeds so pledged and then held or thereafter acquired or received by thedistrict shall immediately be subject to the lien of the pledge without anyphysical delivery or segregation thereof or further act; and the lien of anypledge shall be valid and binding against all parties having claims of any kindin tort, contract or otherwise against the district, irrespective of whetherthe parties have notice thereof. Neither the resolution, any trust agreementnor any other agreement by which a pledge is created need be filed or recordedexcept in the records of the district.
(e) Any holder of a bond or note issued by the district underthe provisions of this chapter or of any of the coupons appertaining theretoand any trustee under a trust agreement or resolution securing the same, exceptto the extent the rights herein given may be restricted by the trust agreementor resolution securing the same, may bring suit upon the bonds or notes orcoupons and may, either at law or in equity, by suit, action, mandamus or otherproceedings for legal or equitable relief, including proceeding for theappointment of a receiver to take possession and control of the business andproperties of the district, too operate and maintain the same, to make anynecessary repairs, renewals and replacements in respect thereof and to fix,revise and collect fees and charges, protect and enforce any and all rightsunder the trust agreement, resolution or other agreement, and may enforce andcompel the performance of all duties required by this act or by the trustagreement or resolution to be performed by the district or by any officerthereof.