§ 776 - Terms of agreement with bond or noteholder - Vermont Statutes

§ 776. Terms of agreement with bond or noteholder

(a) The authority may, in any resolution of the authority authorizing, or relating to the issuance of any bonds or notes, covenant and contract with the holders of the bonds or notes:

(1) To pledge all or any part of the fares, tolls, rentals, rates, charges and other fees made or received by the authority or any of its subsidiary corporations and other monies received or to be received, to secure the payment of the notes or bonds, subject to the agreements with bondholders or noteholders then existing;

(2) To pledge all or any part of the assets of the authority or of any of its subsidiary corporations to secure the payment of the notes or bonds, subject to the agreements with noteholders or bondholders then existing;

(3) To covenant with respect to the use and disposition of fares, tolls, rentals, rates, charges and other fees made or received by the authority or any of its subsidiary corporations;

(4) To covenant with respect to the setting aside of reserves or sinking funds and the regulation and disposition thereof;

(5) To covenant with respect to the limitations on the purpose to which the proceeds of sale of notes or bonds may be applied and pledging the proceeds to secure the payment of the notes or bonds or of any issue thereof;

(6) To covenant with respect to the limitations on the issuance of additional notes or bonds; the terms upon which additional notes or bonds may be issued and secured; the refunding of outstanding or other notes or bonds;

(7) To covenant the procedure, if any, by which the terms of any contract with noteholders or bondholders may be amended or abrogated, the amount of notes or bonds the holders of which must consent and the manner in which such consent may be given;

(8) To covenant with respect to the limitations on the amount of moneys to be expended by the authority or any of its subsidiary corporations for operating, administrative or other expenses of the authority or any of its subsidiary corporations;

(9) To vest in a trustee or trustees any property, rights, powers and duties in trust as the authority may determine, which may include any or all of the rights, powers and duties of the trustee appointed by the holders of any bonds or notes, and to limit or abrogate the right of the holders of any bonds or notes of the authority to appoint a trustee under this chapter or limiting the rights, powers and duties of such trustee;

(10) To covenant with respect to any other matters, of like or different character, which in any way affect the security or protection of the notes or bonds.

(b) In addition to the powers of the authority to secure its notes and bonds, the authority may, in connection with the issuance of notes and bonds, enter into any agreements the authority deems necessary, convenient or desirable concerning the use or disposition of its moneys or property or the moneys or property of any of its subsidiary corporations, including the mortgaging of any property and the entrusting, pledging or creation of any other security interest in any moneys or property and the doing of any act, including refraining from doing any act, which the authority would have the right to do in the absence of the agreements. The authority may enter into amendments of any agreements within the powers granted to the authority under this chapter and perform those agreements. The provisions of any such agreements may be made a part of the contract with the holders of the notes and bonds of the authority.

(c) Any pledge, mortgage or security instrument made by the authority shall be valid and binding from the time when the pledge, mortgage or security instrument is made. The moneys or property pledged, mortgaged and entrusted and received by the authority shall immediately be subject to the lien of the pledge, mortgage or security instrument without any physical delivery or further act and the lien of the pledge, mortgage or security instrument shall be valid and binding against all parties having claims of any kind in tort, contract or otherwise against the authority, irrespective of whether the parties have notice. Neither the resolution nor any mortgage, security instrument or other instrument by which a pledge, mortgage lien or other security is created need be recorded or filed and the authority shall not be required to comply with any of the provisions of the Uniform Commercial Code. (Added 1973, No. 14, § 2, eff. Feb. 23, 1973.)