§ 12 — Payment of bonds

Massachusetts § 12

• Jurisdiction: Massachusetts
• Part I: ADMINISTRATION OF THE GOVERNMENT
• Title VII: CITIES, TOWNS AND DISTRICTS
• Ch. 40N: MODEL WATER AND SEWER COMMISSION

Text

Section 12. The principal of, premium, if any, and interest on all bonds issued under the provisions of this chapter, unless otherwise provided herein, shall be payable solely from the funds provided therefor from revenues as herein provided. Bonds of each issue shall be dated, shall bear interest at such rate or rates, including rates variable from time to time as determined by such index, banker's loan rate or other method determined by the commission, and shall mature at such time or times, as may be determined by the commission, and may be made redeemable before maturity at the option of the commission at such price or prices and under such terms and conditions as may be fixed by the commission prior to the issue of bonds. The commission shall determine the form of bonds, including interest coupons, if any, to be attached thereto, and the matter of execution of bonds, and shall fix the denomination of bonds and the place of payment of principal and interest, which may be at any bank or trust company within or without the commonwealth. In case any officer whose signature or a facsimile of whose signature shall appear on any bonds or coupons shall cease to be such officer before the delivery thereof, such signature or such facsimile shall nevertheless be valid and sufficient for all purposes as if he had remained in office until after such delivery. The commission may also provide for authentication of bonds by a trustee or fiscal agent. Bonds may be issued in bearer or in registered form, or both, and, if notes, may be made payable to bearer or to order, as the commission may determine, and provision may be made for the registration of any coupon bonds as to principal alone and also as to both principal and interest, for the reconversion into coupon bonds of bonds registered as to both principal and interest and for the interchange of bonds registered as to both principal and interest and for the interchange of registered and coupon bonds. The commission may by resolution delegate to the executive director or any member of the commission or any combination of them the power to determine any of the matters set forth in this section including the power to award such notes to a purchaser or purchasers at public sale. The commission may sell its bonds in such manner, either at public or private sale, for such price, at such rate or rates of interest, or at such discount in lieu of interest, as it may determine will best effect the purposes of this chapter.The commission may issue interim receipts or temporary bonds, with or without coupons, exchangeable for definitive bonds when such bonds shall have been executed and are available for delivery. The commission may also provide for the replacement of any bonds which shall have become mutilated or shall have been destroyed or lost.In the discretion of the commission, any bonds issued hereunder may be secured by a resolution of the commission or by a trust agreement between the commission and a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the commonwealth, and such trust agreement shall be in such form and executed in such manner as may be determined by the commission. Such trust agreement or resolution may pledge or assign, in whole or in part, the revenues and other moneys held or to be received by the commission, including the revenues from any facilities already existing when the pledge or assignment is made, and any contract or other rights to receive the same, whether then existing or thereafter coming into existence and whether then held or thereafter acquired by the commission, and the proceeds thereof, but shall not convey or mortgage the water works system or the sewer works system. Such trust agreement or resolution may contain such provisions for protecting and enforcing the rights, security and remedies of the bondholders as may, in the discretion of the commission, be reasonable and proper and not in violation of law, including, without limiting the generality of the foregoing, provisions defining defaults and providing for remedies in the event thereof which may include the acceleration of maturities and covenants setting forth the duties of, and limitations on, the commission in relation to the acquisition, construction, improvement, enlargement, alteration, equipping, furnishing, maintenance, use, operation, repair, insurance and disposition of the water works system, the sewer works system or other property of the commission, the custody, safeguarding, investment and application of moneys, the issue of additional or refunding bonds, the fixing, revision and collection of fees, rates, rents, assessments or other charges, the use of any surplus bond proceeds, the establishment of reserves, and the making and mending of contracts.In the discretion of the commission any bonds or notes issued under authority of this chapter, including notes issued under authority of section nine, may be issued by the commission in the form of lines of credit or other banking arrangements and under such terms and conditions, not inconsistent with this chapter, and under such agreements with the purchasers or makers thereof, as the commission may determine to be in the best interest of the commission. In addition to other security provided herein or otherwise by law, bonds or notes issued by the commission under any provision of this chapter, including section nine hereof, may be secured, in whole or in part, by letter of credit issued to the commission by any bank, trust company or other financial institution, within or without the commonwealth, and the commission may pledge or assign any of its revenues as security for the reimbursement by the commission to the issuers of such letter of credit of any payments made under the letters of credit.It shall be lawful for any bank or trust company to act as a depository or trustee of the proceeds of bonds, revenues or other moneys under any such trust agreement or resolution and to furnish such indemnification or to pledge such securities and issue such letters of credit as may be required by the commission. Any such trust agreement or resolution may set forth the rights and remedies of bondholders and of the trustee and may restrict the individual right of action by bondholders. In addition to the foregoing, any such trust agreement or resolution may contain such other provisions as the commission may deem reasonable and proper for the security of bondholders. Any pledge of revenues or other property made by the commission under this chapter shall be valid and binding and shall be deemed continuously perfected for the purposes of chapter one hundred and six from the time when the pledge is made; the revenues, moneys, rights and proceeds so pledged and then held or thereafter acquired or received by the commission shall immediately be subject to the lien of such pledge without any physical delivery or segregation thereof or further act; and the lien of any such pledge shall be valid and binding against all parties having claims of any kind in tort, contract or otherwise against the commission, irrespective of whether such parties have notice thereof. Neither the resolution, any trust agreement nor any other agreement by which a pledge is created need be filed or recorded except in the records of the commission, and no filing need be made under the provisions of chapter one hundred and six.Any holder of a bond issued by the commission under the provisions of this chapter or of any of the coupons appertaining thereto and any trustee under a trust agreement or resolution securing the same, except to the extent the rights herein given may be restricted by such trust agreement or resolution securing the same, except to the extent the rights herein given may be restricted by such trust agreement or resolution, may bring suit upon the bonds or coupons and may, either at law or in equity, by suit, action, mandamus, or other proceedings for legal or equitable relief, including proceedings for the appointment of a receiver to take possession and control of the business and properties of the commission, to operate and maintain the same, to make any necessary repairs, renewals and replacements in respect thereof and to fix, revise and collect fees and charges, protect and enforce any and all rights under such trust agreement, resolution or other agreement, and may enforce and compel the performance of all duties required by this act or by such trust agreement or resolution to be performed by the commission or by any officer thereof.