§ 45-33.2-7. Security for bonds — Trust agreements.
(a) In the discretion of the officers authorized to sell the bonds, but subject to the
provisions of the vote authorizing the bonds, bonds issued under this chapter may
be secured by one or more trust agreements between the city or town and a corporate
trustee or trustees, which may be any trust company or bank having the powers of a
trust company within or without the state. A trust agreement under this section shall
be in a form and executed in a manner that may be determined by the officers. A trust
agreement may pledge or assign project revenues, in whole or in part. It may contain
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§ 45-33.2-7. Security for bonds — Trust agreements.
(a) In the discretion of the officers authorized to sell the bonds, but subject to the
provisions of the vote authorizing the bonds, bonds issued under this chapter may
be secured by one or more trust agreements between the city or town and a corporate
trustee or trustees, which may be any trust company or bank having the powers of a
trust company within or without the state. A trust agreement under this section shall
be in a form and executed in a manner that may be determined by the officers. A trust
agreement may pledge or assign project revenues, in whole or in part. It may contain
provisions for protecting and enforcing the rights, security, and remedies of the
bondholders as may be reasonable and proper and not in violation of law, including
without limiting the generality of the preceding, provisions defining defaults and
providing for remedies in the event of defaults, which may include the acceleration
of maturities, and covenants stating duties of, and limitations on, the city or town
in relation to carrying out and otherwise administering the project or projects, the
custody, safeguarding, investment and application of project revenues, the issue of
additional bonds under this chapter, the determination of tax increments, the fixing
of fees and charges, if any, in relation to the project or projects, the collection
of project revenues, the use of any surplus bond proceeds, the establishment of reserves,
and the replacement of bonds or coupons which become mutilated or are destroyed or
lost. Subject to the provisions of this chapter, moneys subject to the trust agreement
shall be held, invested, and applied as provided in the trust agreement; provided,
that moneys not deposited in trust with a corporate trustee shall be in the custody
of the city or town treasurer.
(b) It is lawful for any bank or trust company to act as a depository or trustee of the
proceeds of bonds or of other moneys under any trust agreement and to furnish indemnifying
bonds or to pledge securities that may be required by the trust agreement. The trust
agreement or resolution may establish the rights and remedies of the bondholders and
the trustee, and may restrict the individual right of action by bondholders. All expenses
incurred in carrying out the provisions of the trust agreement or resolution may be
treated as current operating expenses.