48-3218. Covenants in resolution or trust agreement
742 words·~3 min read·
/az/title-48/48-3218A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A. Any resolution or trust agreement pertaining to the issuance of bonds under this article shall authorize the undertaking and may in addition contain covenants as to:
1. The purpose to which the proceeds of the sale of the bonds may be applied and the use and disposition thereof including, if deemed desirable, the appointment of a trustee or depository for the proceeds of the bonds.
2. The pledging of the revenue of the district, or any part thereof, or all or any part of the revenue from the undertaking, including improvements or extensions thereafter constructed or acquired, to the payment of the principal of and interest on bonds issued pursuant to this article, and for such reserve and other funds as may be deemed necessary or advisable.
3. The fixing, establishing and collection of such fees, rentals or other charges for the use of the services and facilities of the district or such undertaking and the revision thereof from time to time, as will always provide revenues at least sufficient to provide for all expenses of operation, maintenance and repair of the services and facilities of the district or such undertaking, the payment of the principal of and interest on all bonds or other obligations payable from the revenues of the district or such undertaking and all reserve and other funds required by the terms of the resolution authorizing the issuance of such bonds.
4. Limitations or restrictions on issuing additional bonds or other obligations payable from the revenues of the district, or any part thereof, or all or any part of the revenues of the undertaking and the rights and remedies of the holders of such additional bonds, or refunding bonds, issued therefor.
5. The procedure, if any, by which the terms of any covenant with the holder or holders of bonds issued pursuant to this article may be amended, abrogated or altered.
6. The rank or priority as to lien and source of security for payment from the revenues of the district or the undertaking between and among bonds issued pursuant to this article and bonds issued pursuant to other lawful authority. The priorities assigned under this section do not impair any obligations in covenants of existing bonds.
7. The appointment of a trustee or trustees to hold and apply any revenues derived from the undertaking.
8. The appointment of a trustee or trustees to act for and on behalf of bondholders, and the manner and terms of the appointment, and the powers of such trustee or trustees.
9. The manner and terms on which all bonds or other obligations issued pursuant to this article may be declared immediately due and payable on default in the payment of the principal of or interest thereon, or in the performance of any covenant or agreement with bondholders, and the manner and terms on which such default may be declared cured, and the acceleration of the maturity of such bonds or other obligations rescinded and repealed.
10. Budgets for the annual operation, maintenance and repair of such undertaking or program and restrictions and limitations on expenditure for such purposes, and the manner of adoption, modification, repeal or amendment thereof.
11. The insurance to be maintained on the undertaking, or any part thereof, and the use and disposition of the proceeds of any insurance.
12. The keeping of books of account relating to the undertaking and the audit and inspection thereof.
13. The method and means for enforcing and collecting fees, rentals or other charges for the services and facilities of the district or the undertaking and rules including reasonable penalties for such enforcement and collection.
14. Rights and remedies of the holders of bonds and the manner of exercising and enforcing such rights and remedies.
15. Such other and additional covenants deemed necessary for the security of the holders of bonds or other obligations issued pursuant to this article.
B. All such covenants and agreements constitute valid and binding contracts between the district and the holders of any bonds or other obligations issued pursuant to such resolution, regardless of the time of issuance thereof, and, subject to any limitations contained in such resolution or trust agreement or this article, are enforceable by any holder or holders of such bonds or other obligations, acting either for himself or themselves alone, or acting in behalf of all other holders of such bonds or other obligations, by appropriate proceedings in any court of competent jurisdiction.