Michigan Laws 129.271 – Duties of state before payment or discharge of bonds and ancillary facilities
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Terms Used In Michigan Laws 129.271
- Authority: means the Michigan tobacco settlement finance authority created under section 4. See Michigan Laws 129.263
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Benefited parties: means persons, firms, or corporations that enter into ancillary facilities with the authority according to the provisions of this act. See Michigan Laws 129.263
- Code: means the United States internal revenue code of 1986, as amended, and any successor provision of law. See Michigan Laws 129.263
- Contract: A legal written agreement that becomes binding when signed.
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Federal bankruptcy code: means the federal bankruptcy code, 11 USC 101 to 1330. See Michigan Laws 129.263
- Master settlement agreement: means the settlement agreement and related documents entered into on November 23, 1998, and incorporated into a consent decree and final judgment entered into on December 7, 1998, in Kelley Ex Rel. See Michigan Laws 129.263
- Outstanding: means , when used with respect to bonds, all bonds other than bonds that shall have been paid in full at maturity or that may be considered not outstanding under the applicable authority resolution, trust indenture or trust agreement authorizing the issuance of the bonds and when used with respect to ancillary facilities, all ancillary facilities other than ancillary facilities that have been paid in full or that may be considered not outstanding under such ancillary facilities. See Michigan Laws 129.263
- Person: means an individual, corporation, limited or general partnership, association, joint venture, limited liability company, or a governmental entity, including this state. See Michigan Laws 129.263
- Qualifying statute: means that term as defined in the master settlement agreement, which is 1999 PA 244, MCL 445. See Michigan Laws 129.263
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
- Statute: A law passed by a legislature.
- TSRs: means the portion, which may include any or all, of this state's tobacco receipts sold to the authority under this act and any sale agreement. See Michigan Laws 129.263
(1) This state hereby pledges and agrees with the authority, and the owners of the bonds and benefited parties, that until all bonds and ancillary facilities, together with the interest on the bonds and ancillary facilities and all costs and expenses in connection with any action or proceedings by or on behalf of owners of bonds or benefited parties, are fully paid and discharged, that this state will do all of the following:
(a) Irrevocably direct the escrow agent under the master settlement agreement to transfer the TSRs directly to the authority or its assignee.
(b) Enforce the authority’s rights to receive the TSRs to the full extent permitted by the terms of the master settlement agreement.
(c) Not amend the master settlement agreement in any manner that would materially impair the rights of the owners of the bonds or of the benefited parties.
(d) Not limit or alter the rights of the authority to fulfill the terms of its agreements with owners of the bonds or benefited parties.
(e) Not in any way impair the rights and remedies of owners of the bonds or benefited parties or the security for the bonds or ancillary facilities, provided, that nothing in this act shall be construed to preclude this state’s regulation of smoking, and the taxation and regulation of the sale of cigarettes or other tobacco products.
(f) Not fail to enforce the qualifying statute.
(g) Not amend, supersede, or repeal the qualifying statute in any way that would materially adversely affect the amount of any payment to, or materially impair the rights of, the authority, owners of the bonds, or the benefited parties.
(2) The state budget director is authorized and directed to include the pledge and agreement made under this section in sale agreements and the authority is authorized and directed to include the pledge and agreement in any contract with the owners of the bonds and benefited parties.
(3) Prior to the date that is 1 year and 1 day after the authority no longer has any bonds or ancillary facilities outstanding, the authority shall have no authority to file a voluntary petition under chapter 9 of the federal bankruptcy code or such corresponding chapter or sections as may, from time to time, be in effect, and neither any public officer or any organization, entity, or other person shall authorize the authority to be or become a debtor under chapter 9 of the federal bankruptcy code or any successor or corresponding chapter or sections during that period. This state hereby covenants with the owners of the bonds and benefited parties that this state will not limit or alter the denial of the authority under this subsection during the period referred to in this subsection. The authority is authorized and directed to include this covenant as an agreement of this state in any contract with the owners of the bonds and benefited parties.