§ 35-A:8 — Bonds and Notes of the Bank

I. The bank shall have the power and is hereby authorized from time to time to issue its bonds or notes in such principal amounts as it shall deem necessary to provide funds for any purposes authorized by this chapter, including the making of loans, the payment, funding or refunding of the principal of, or interest or redemption premiums on, any bonds or notes issued by it whether the bonds or notes or interest to be funded or refunded have or have not become due, the establishment or increase of such reserves to secure or to pay such bonds or notes or interest thereon and all other costs or expenses of the bank incident to and necessary or convenient to carry out its corporate purposes and powers.
II. Except as may be otherwise expressly provided herein or by the bank in its authorizing resolution, every issue of bonds or notes shall be general obligations payable out of any revenues or funds of the bank, subject only to any agreements with the holders of particular bonds or notes pledging any particular revenues or funds. Any such bonds or notes may be additionally secured by a pledge of any grant or contributions from the United States of America or the state or any governmental unit or any person, firm or corporation or a pledge of any income or revenues, funds or moneys of the bank from any source whatsoever.
III. Any provision of any law to the contrary notwithstanding, any bond or note issued pursuant to this chapter shall be fully negotiable within the meaning and for all purposes of the negotiable instruments law of this state, and each holder or owner of such bond or note, or of any coupon appurtenant thereto, by accepting such a bond or note or coupon shall be conclusively deemed to have agreed that such bond, note or coupon is and shall be fully negotiable within the meaning and for all purposes of said negotiable instruments law of this state, subject only to the provisions of the bonds and notes for registration.
IV. Bonds or notes of the bank shall be authorized by resolution of the bank and may be issued in one or more series and shall bear such date or dates, mature at such time or times, not exceeding with respect to notes, 8 years from the date of issue of the original notes and with respect to bonds 50 years from the date of their issue, provide sinking fund payments, bear interest at such rate or rates of interest per annum or within such maximum rate, be in such denomination or denominations, be in such form, either coupon or registered, carry such conversion or registration privileges, have such rank or priority, be executed in such manner, be payable from such sources in such medium of payment at such place or places within or without the state, and be subject to such terms of redemption (with or without premium) as such resolution or resolutions may provide. In case any of the members, executive director or officers of the bank whose signatures appear on any notes or bonds or coupons shall cease to be such members, executive director or officers before the delivery of such notes or bonds, such signatures shall, nevertheless, be valid and sufficient for all purposes, the same as if such members, executive director or officers had remained in office until such delivery.
V. Bonds or notes of the bank may be sold at public or private sale at such time or times and at such price or prices as the bank shall determine.
VI. Bonds or notes may be issued under the provisions of this chapter without obtaining the consent of the governor and council or of any department, division, commission, board, bureau or agency of the state, and without any other proceeding or the happening of any other conditions or things than those proceedings, conditions or things which are specifically required by this chapter.
VII. The bank may from time to time issue its notes as provided under this chapter and pay and retire or fund or refund such notes from proceeds of bonds or of other notes, or from any other funds or moneys of the bank available or to be made available for such purpose in accordance with any contract between the bank and the holders of the notes. Unless provided otherwise in any contract between the bank and the holders of notes, and unless such notes shall have been otherwise paid, funded or refunded, the proceeds of any bonds of the bank issued among other things, to fund such outstanding notes, shall be held, used and applied by the bank to the payment and retirement of the principal of such notes and the interest due and payable thereon.
VIII. The bank is authorized to provide for the issuance of its bonds or notes in such amounts as it may deem necessary for the purpose of refunding any bonds or notes of the bank then outstanding, including the payment of any redemption premium thereon and any interest accrued or to accrue to the earliest or subsequent date of redemption, purchase or maturity of such bonds or notes. The proceeds of any such bonds or notes issued for the purpose of refunding outstanding bonds or notes, may, in the discretion of the bank, be applied to the purchase or retirement at maturity or redemption of such outstanding bonds or notes either on their earliest or any subsequent redemption date, and may, pending such application, be placed in escrow to be applied to such purchase or retirement at maturity or redemption on such date as may be determined by the bank. Any such escrowed proceeds, pending such use, may be invested and reinvested, subject to any agreements with note or bondholders, in such manner as the bank shall determine, maturing at such time or times as shall be appropriate to assure the prompt payment, as to principal, interest and redemption premium, if any, on the outstanding bonds or notes to be so refunded. The interest, income and profits, if any, earned or realized on any such investment may also be applied to the payment of the outstanding bonds or notes to be so refunded. After the terms of the escrow have been fully satisfied and carried out, any balance of such proceeds and interest, income and profits, if any, earned or realized on the investments thereof may be returned to the bank for use by it in any lawful manner.
IX. Bonds or notes issued by the bank may be secured in whole or in part by insurance or by letters or lines of credit or other credit facilities as provided by resolution of the bank authorizing such bonds or notes. Any such insurance, letter or line of credit or credit facility may provide for reimbursement to be made over such period of time, at such rate of interest and upon such other terms, conditions and covenants as shall be approved by resolution of the bank authorizing such bonds or notes.

Legislative History

1977, 491:1. 1988, 52:1, eff. April 4, 1988.