Note
Part heading added by L 1990, c 106, §4(1).
§206M-9 Issuance of special purpose revenue bonds; bond anticipation notes; refunding bonds. (a) In addition to the other powers that it may have, the development corporation may issue special purpose revenue bonds to finance, in whole or in part, the costs of projects of, for, or to loan the proceeds of the bonds to assist qualified persons. All revenue bonds issued under this chapter are special purpose revenue bonds and part III of chapter 39 shall not apply thereto. All special purpose revenue bonds shall be issued in the name of the development corporation and not in the name of the State.
The legislature finds and determines that the exercise of the powers vested in the development corporation by this chapter constitutes assistance to a high technology industrial, manufacturing, or processing enterprise and that the issuance of special purpose revenue bonds to finance facilities of, for, or to loan the proceeds of the bonds to assist qualified persons, is in the public interest.
(b) The development corporation, with the approval of the governor, may issue special purpose revenue bonds for each single project or industrial park or multi-project program that has been authorized by the legislature by an affirmative vote of two-thirds of the members to which each house is entitled; provided that the legislature shall find that the issuance of the special purpose revenue bonds is in the public interest. Special purpose revenue bonds shall be issued in principal amounts as may be authorized from time to time by law and at the time or times as the development corporation deems necessary and advisable to finance the cost of a project, industrial park, or multi-project program as authorized by law. With respect to the financing of a multi-project program with the proceeds of special purpose revenue bonds, the legislature may authorize the issuance from time to time in one or more series by the development corporation, in each case with the approval of the governor, of special purpose revenue bonds in the aggregate principal amount and during the period as the legislature shall provide. The principal of, premium, if any, and interest on the special purpose revenue bonds shall be payable:
(1) Exclusively from the revenues and receipts derived or to be derived by the development corporation under project agreements or from the revenues and receipts together with any grant from the government in aid of the project or industrial park financed from the proceeds of the bonds;
(2) Exclusively from the revenues and receipts derived or to be derived by the development corporation from a particular project agreement, whether or not the project or industrial park to which it relates is financed in whole or in part with the proceeds of the special purpose revenue bonds; or
(3) From revenues and receipts derived or to be derived by the development corporation generally.
Neither the board members nor any person executing the special purpose revenue bonds shall be liable personally on the bonds by reason of the issuance thereof.
All special purpose revenue bonds of the same issue (or, in the case of an authorized issue for a multi-project program, series), subject to the prior and superior rights of outstanding bonds, claims, obligations, or mechanic's and materialman's liens, shall have a prior and paramount lien on the revenues derived from the project agreement with respect to the project for which the bonds have been issued, over and ahead of all special purpose revenue bonds of the issue (or series) payable from the revenues which may be subsequently issued and over and ahead of any claims or obligations of any nature against the revenues subsequently arising or subsequently incurred; provided that the development corporation may reserve the right and privilege to subsequently issue additional series of special purpose revenue bonds, from time to time, payable from the revenues derived from the project agreement on a parity with the issue or series of special purpose revenue bonds theretofore issued, and the subsequently issued series of special purpose revenue bonds may be secured, without priority by reason of date of sale, date of execution, or date of delivery, by a lien on the revenues in accordance with law, including this chapter.
(c) Special purpose revenue bonds issued pursuant to this chapter may be in one or more issues and in one or more series within an issue and shall be further authorized pursuant to resolution of the board. The special purpose revenue bonds shall be dated, shall bear interest at the rate or rates, shall mature at the time or times not exceeding forty years from their date or dates, shall have the rank or priority, and may be made redeemable before maturity at the option of the development corporation, at the price or prices and under the terms and conditions, all as may be determined by the development corporation.
The development corporation shall determine the form of the special purpose revenue bonds, including interest coupons, if any, to be attached thereto, and the manner of execution of the special purpose revenue bonds, and shall fix the denomination or denominations of the special purpose revenue bonds and, subject to the approval of the director of finance, the place or places of payment of principal and interest, which may be at any bank or trust company approved by the director of finance within or without the State.
The special purpose revenue bonds may be issued in coupon or in registered form, or both, as the development corporation may determine, and provisions may be made for the registration of coupon bonds as to principal alone and also as to both principal and interest, and for the reconversion into coupon bonds of special purpose revenue bonds registered as to both principal and interest. Subject to the approval of the director of finance, the development corporation may sell special purpose revenue bonds in such manner, either at public or private sale, and for such price as it may determine.
(d) Prior to the preparation of definitive special purpose revenue bonds, the development corporation may issue interim receipts or temporary bonds, with or without coupons, exchangeable for definitive bonds when the bonds have been executed and are available for delivery.
(e) Should any special purpose revenue bond issued under this chapter or any coupon appertaining thereto become mutilated, lost, stolen, or destroyed, the development corporation may cause a new bond or coupon of like date, number, and tenor to be executed and delivered in exchange and substitution for, and upon the cancellation of the mutilated bond or coupon, or in lieu of and in substitution for the lost, stolen, or destroyed bond or coupon. The new bond or coupon shall not be executed or delivered until the holder of the mutilated, lost, stolen, or destroyed bond or coupon:
(1) Has paid the reasonable expenses and charges in connection therewith;
(2) In the case of a lost, stolen, or destroyed bond or coupon, has filed with the development corporation or its fiduciary evidence satisfactory to the development corporation or its fiduciary that the bond or coupon was lost, stolen, or destroyed and that the holder was the owner thereof; and
(3) Has furnished indemnity satisfactory to the development corporation.
(f) The development corporation in its discretion may provide that CUSIP identification numbers shall be printed on the special purpose revenue bonds. If the numbers are imprinted on the bonds:
(1) No such number shall constitute a part of the contract evidenced by the particular bond upon which it is imprinted; and
(2) No liability shall attach to the development corporation or any officer or agent thereof, including any fiscal agent, paying agent, or registrar for the bonds by reason of the numbers or any use made thereof, including any use thereof made by the development corporation, any such officer, or any such agent, or by reason of any inaccuracy, error, or omission with respect thereto or in such use. The development corporation in its discretion may require that all costs of obtaining and imprinting the numbers shall be paid by the purchaser of the bonds. For the purposes of this subsection, the term "CUSIP identification numbers" means the numbering system adopted by the Committee for Uniform Security Identification Procedures formed by the Securities Industry Association.
(g) Whenever the development corporation has authorized the issuance of special purpose revenue bonds under this chapter, special purpose revenue bond anticipation notes of the development corporation may be issued in anticipation of the issuance of the bonds and of the receipt of the proceeds of sale thereof, for the purposes for which the bonds have been authorized. All special purpose revenue bond anticipation notes shall be authorized by the development corporation, and the maximum principal amount of the notes shall not exceed the authorized principal amount of the bonds. The notes shall be payable solely from and secured solely by the proceeds of sale of the special purpose revenue bonds in anticipation of which the notes are issued and the moneys, rates, charges, and other revenues from which would be payable and by which would be secured the bonds; provided that to the extent that the principal of the notes shall be paid from moneys other than the proceeds of sale of the bonds, the maximum amount of bonds that has been authorized in anticipation of which the notes are issued shall be reduced by the amount of notes paid in this manner. The authorization, issuance, and the details of the notes shall be governed by this chapter with respect to special purpose revenue bonds insofar as the same may be applicable; provided that each note, together with all renewals and extensions thereof, or refundings thereof by other notes issued under this subsection, shall mature within five years from the date of the original note.
(h) To secure the payment of any of the special purpose revenue bonds issued pursuant to this chapter, and interest thereon, or in connection with the bonds, the development corporation shall have the power as to the bonds:
(1) To pledge all or any part of the revenues and receipts derived or to be derived by the development corporation as provided in this chapter to the punctual payment of special purpose revenue bonds issued with respect to the project or industrial park financed from the proceeds thereof, and interest thereon, and to covenant against thereafter pledging any such revenues and receipts to any other bonds or any other obligations of the development corporation for any other purpose, except as otherwise stated in the proceedings providing for the issuance of special purpose revenue bonds permitting the issuance of additional special purpose revenue bonds to be equally and ratably secured by a lien upon such revenues and receipts;
(2) To pledge and assign the interest and right of the development corporation under any project agreement and other agreements related to a project or industrial park, and the rights, duties, and obligations of the development corporation thereunder, including the right to receive revenues and receipts thereunder;
(3) To pledge or assign all or any part of the proceeds derived by the development corporation from proceeds of insurance or condemnation awards;
(4) To covenant as to the use and disposition of the proceeds from the sale of the special purpose revenue bonds;
(5) To covenant to set aside or pay over reserves and sinking funds for the special purpose revenue bonds and as to the disposition thereof;
(6) To covenant and prescribe as to what happenings or occurrences shall constitute "events of default", the terms and conditions upon which any or all of the bonds shall become or may be declared due before maturity, and as to the terms and conditions upon which the declaration and its consequences may be waived;
(7) To covenant as to the rights, liabilities, powers, and duties arising upon the breach by the development corporation of any covenant, condition, or obligation;
(8) Subject to the approval of the director of finance, to designate a national or state bank or trust company within or without the State, incorporated in the United States, to serve as trustee for the holders of the special purpose revenue bonds and to enter into a trust indenture, trust agreement, or indenture of mortgage with the trustee. The trustee may be authorized by the development corporation to receive and receipt for, hold, and administer the proceeds of the special purpose revenue bonds and to apply the proceeds to the purposes for which the special purpose revenue bonds are issued, or to receive and receipt for, hold, and administer the revenues and receipts derived or to be derived by the development corporation under a project agreement or other agreement related to a project or industrial park, and to apply such revenues and receipts to the payment of the principal of and interest on the special purpose revenue bonds, or both, and any excess revenues and receipts to the payment of expenses incurred by the development corporation in administering the special purpose revenue bonds or in carrying out the project agreement or other agreement. If the trustee shall be appointed, any trust indenture, trust agreement, or indenture of mortgage entered into by the development corporation with the trustee may contain whatever covenants and provisions as may be necessary, convenient, or desirable in order to secure the special purpose revenue bonds. The development corporation may pledge and assign to the trustee the interest of the development corporation under a project agreement and other agreements related thereto and the rights, duties, and obligations of the development corporation thereunder, including the right to receive revenues and receipts thereunder. The development corporation may appoint the trustee to serve as fiscal agent for the payment of the principal and interest, and for the purchase, registration, transfer, exchange, and redemption of the special purpose revenue bonds, and may authorize and empower the trustee to perform the functions with respect to the payment, purchase, registration, transfer, exchange, and redemption, as the development corporation may deem necessary, advisable, or expedient, including, without limitation, the holding of the special purpose revenue bonds and coupons that have been paid and the supervision of the destruction thereof in accordance with law;
(9) To execute all instruments necessary or convenient in the exercise of the powers herein granted or in the performance of its covenants and duties;
(10) To invest or provide for the investment of the proceeds of special purpose revenue bonds and revenues and receipts derived by the development corporation in the securities and in such manner as it deems proper; and
(11) To make such covenants and do any and all acts and things as may be necessary, convenient, or desirable in order to secure the special purpose revenue bonds, notwithstanding that the covenants, acts, or things may not be enumerated in this chapter.
No holder or holders of special purpose revenue bonds issued under this chapter shall ever have the right to compel any exercise of the taxing power of the State or any political subdivision of the State to pay the special purpose revenue bonds or the interest thereon and no moneys other than the revenues pledged to the special purpose revenue bonds shall be applied to the payment thereof.
(i) Special purpose revenue bonds bearing the signature or facsimile signature of officers in office on the date of the signing thereof shall be valid and sufficient for all purposes, notwithstanding that before the delivery thereof and payment therefor any or all of the persons whose signatures appear thereon shall have ceased to be officers of the development corporation. The special purpose revenue bonds shall contain a recital that they are issued pursuant to this chapter which recital shall be conclusive evidence of their validity and of the regularity of their issuance.
(j) Subject to authorization by an act enacted by the legislature by an affirmative vote of two-thirds of the members to which each house is entitled, the development corporation may issue special purpose revenue bonds for the purpose of refunding special purpose revenue bonds then outstanding and issued under this chapter whether or not the outstanding special purpose revenue bonds have matured or are then subject to redemption. The development corporation may issue special purpose revenue bonds for the combined purposes of:
(1) Financing or refinancing the cost of a project or industrial park, or the improvement or expansion thereof; and
(2) Refunding special purpose revenue bonds that shall theretofore have been issued under this chapter and then shall be outstanding, whether or not the outstanding bonds have matured or then are subject to redemption.
Nothing in this subsection shall require or be deemed to require the development corporation to elect to redeem or prepay special purpose revenue bonds being refunded, or to redeem or prepay special purpose revenue bonds being refunded that were issued, in the form customarily known as term bonds in accordance with any sinking fund installment schedule specified in any proceeding authorizing the issuance thereof, or, if the development corporation elects to redeem or prepay any such bonds, to redeem or prepay as of any particular date or dates. The issuance of the special purpose revenue bonds, the maturities and other details thereof, the rights and remedies of the holders thereof, and the rights, powers, privileges, duties, and obligations of the development corporation with respect to the bonds, shall be governed by the foregoing provisions of this chapter insofar as the same may be applicable.
(k) If special purpose revenue bonds issued pursuant to this chapter are issued bearing interest at a rate or rates which vary from time to time and with a right of holders to tender the bonds for purchase, the development corporation may contract for such support facility or facilities and remarketing arrangements as are required to market the special purpose revenue bonds to the greatest advantage of the development corporation upon such terms and conditions as the development corporation deems necessary and proper.
The development corporation may enter into contracts or agreements with the entity or entities providing a support facility; provided that any contract or agreement shall provide, in essence, that any amount due and owing by the development corporation under the contract or agreement on an annual basis shall be payable solely from the revenue and receipts of the project agreement and any obligation issued or arising pursuant to the terms of the contract or agreement in the form of special purpose revenue bonds, notes, or other evidences of indebtedness shall only arise at such time as either:
(1) Moneys or securities have been irrevocably set aside for the full payment of a like principal amount of special purpose revenue bonds issued pursuant to this chapter; or
(2) A like principal amount of the issue or series of special purpose revenue bonds to which the support facility relates are held in escrow by the entity or entities providing the support facility. [L 1983, c 152, pt of §2; am L 2000, c 72, §13]
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