Vermont Statutes Title 10 Sec. 243
Terms Used In Vermont Statutes Title 10 Sec. 243
- Bond: means a note, bond, debenture, or any other evidence of indebtedness issued by a municipality or by the State of Vermont under subchapter 4 of this chapter to finance a project in whole or in part or to refund indebtedness incurred for that purpose. See
- eligible facility: means the creation, establishment, acquisition, construction, expansion, improvement, reclamation, or renovation of an eligible facility. See
- Federally guaranteed security: means any security, investment, or evidence of indebtedness that is either directly or indirectly insured, or guaranteed, in whole or in part, as to the repayment of principal or interest, or both, by the United States or any instrumentality thereof. See
- Lien: A claim against real or personal property in satisfaction of a debt.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Municipality: means a city, town, or incorporated village. See
- Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
§ 243. Security documents
(a) An assignment, pledge, mortgage or other encumbrance of all or part of a municipality‘s right to receive payments with respect to an eligible facility contained in a security document shall be fully effective from the time when the security document is executed with or without any subsequent physical delivery or segregation of the money and without any filing or recording under the Uniform Commercial Code or otherwise.
(b) A security document may contain covenants of the municipality as to:
(1) the creation and maintenance of reserves;
(2) the issuance of other bonds with respect to the eligible facility;
(3) the custody, investment and application of monies;
(4) the disposition of insurance or condemnation proceeds;
(5) the use of surplus bond proceeds;
(6) action by the municipality in the event of a default by the user under the financing document;
(7) the subjecting of additional property to the lien of the security document;
(8) any other matter which affects the security for the bonds in any way;
(9) pledging any federally guaranteed security and monies received therefrom whether such security is acquired by the municipality or by a user to secure the payment of the bonds.
(c) A security document may limit the rights of bondholders to enforce obligations of the municipality thereunder or under the financing document. (Added 1973, No. 197 (Adj. Sess.), § 1; amended 1975, No. 18, § 10, eff. March 27, 1975; 1981, No. 54, § 10, eff. April 28, 1981; 1993, No. 89, § 3(b), eff. June 15, 1993.)