(1)(a) The principal and interest
on any bonds or notes issued by the authority may be secured by a trust indenture
by and between the authority and a corporate trustee. Such trust indenture or the
resolution providing for the issuance of such obligations may pledge or assign all or
any part of the revenues or assets of the authority, including, without limitation,
student obligations, student obligation commitments, institutional loans, moneys
deposited or pledged by or on behalf of one or more institutions of higher
education, moneys deposited or pledged by the division, temporary loans,
contracts, agreements, and other security or investment obligations, the fees or
charges made or received by the authority, the moneys received in payment of
student obligations and institutio
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(1) (a) The principal and interest
on any bonds or notes issued by the authority may be secured by a trust indenture
by and between the authority and a corporate trustee. Such trust indenture or the
resolution providing for the issuance of such obligations may pledge or assign all or
any part of the revenues or assets of the authority, including, without limitation,
student obligations, student obligation commitments, institutional loans, moneys
deposited or pledged by or on behalf of one or more institutions of higher
education, moneys deposited or pledged by the division, temporary loans,
contracts, agreements, and other security or investment obligations, the fees or
charges made or received by the authority, the moneys received in payment of
student obligations and institutional loans and interest on such moneys, including
the proceeds of insurance on such obligations and loans and any other moneys
received or due to be received by the authority.
(b) Such trust indenture or resolution may contain such provisions for
protecting and enforcing the rights and remedies of the holders of any of the bonds
or notes as may be reasonable and proper and not in violation of law, including
covenants setting forth the duties of the authority in relation to the purposes to
which proceeds of the bonds or notes may be applied, the disposition or pledging of
the revenues or assets of the authority, the terms and conditions for the issuance of
additional bonds or notes, and the custody, safeguarding and application of all
moneys. Any such trust indenture or resolution may set forth the rights and
remedies of the holders of any bonds or notes and of the trustee and may restrict
the individual right of action by any such holders.
(c) In addition, any such trust indenture or resolution may contain such other
provision as the authority may deem reasonable and proper for the security of the
holders of any bonds or notes, including but not limited to provisions for insurance,
letters of credit, standby credit agreements, take-out commitments, or other forms
of credit insuring against default or guaranteeing timely payment with respect to
student obligations, institutional loans, or bonds. All expenses incurred in carrying
out the provisions of such indenture or resolution may be paid from the revenues or
assets pledged or assigned to the payment of the principal of and the interest on
bonds or notes or from any other funds available to the authority.
(2) (a) Any pledge made by the authority, by one or more institutions of
higher education, by a nonprofit corporation acting on behalf of one or more
institutions of higher education, or by the division shall be valid and binding from
the time when the pledge is made. The revenues and moneys so pledged and
thereafter received by or otherwise credited to such pledging parties shall
immediately be subject to lien of such pledge without any physical delivery, filing,
or further act, and the lien of such pledge shall have priority over any and all other
obligations and liabilities of such pledging parties, subject to any contractual
covenants by the pledging parties and any prior pledges and liens, and shall be
valid, binding, and enforceable against all parties having claims of any kind in tort,
contract, or otherwise against such pledging parties, irrespective of whether such
claiming parties have notice of such lien. Neither the resolution nor any other
instrument by which a pledge is created need be recorded. Each pledge,
agreement, and indenture made for the benefit or security of any of the bonds of
the authority shall continue to be effective until the principal of and interest on the
bonds for the benefit of which the same are made has been fully paid or provision
for such payment duly made.
(b) In the event of default in any such payment or in any agreements of the
authority made as part of the contract under which the bonds were issued, whether
contained in the resolution authorizing the bonds or in any trust indenture executed
as security for such bonds, said payment or agreement may be enforced by suit,
mandamus, or either of such remedies.
(3) Any bank or trust company that may act as depository of the proceeds of
bonds or of revenues or other moneys may furnish such indemnifying bonds or
pledge such securities as required by the authority.