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This entry was published on 2014-09-22
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SECTION 20.19
Security for bonds or notes
Arts and Cultural Affairs (ACA) CHAPTER 11-C, TITLE E, ARTICLE 20
§ 20.19. Security for bonds or notes. 1. The principal of and interest
on any bonds or notes issued by a trust may be secured by a pledge of
any revenues and receipts of the trust, including without limitation the
receipt of sums as tax-equivalency payments or loan repayments, and may
be secured by a lease, loan agreement, mortgage, pledge, security
interest or other instrument covering all or any part of a combined-use
facility or cultural facility as authorized by this article, including
any additions, improvements, extensions to or enlargements of such a
facility thereafter made. Bonds or notes issued for a combined-use
facility or cultural facility as authorized by this article may also be
secured by an assignment of any lease of such combined-use facility or
cultural facility as authorized by this article and by an assignment of
the revenues and receipts of a trust from any such lease and by the
assignment of any loan agreement with a participating cultural
institution and by an assignment of the revenues and receipts of a trust
from any such loan agreement and by the assignment of any mortgage,
pledge, security interest or other instrument covering a combine-use
facility or cultural facility.

2. A trust may provide in any proceedings under which bonds or notes
may be authorized for the time and manner of and the requisites for
disbursements for the cost of a combined-use facility or cultural
facility authorized by this article, and for all certificates and
approvals of construction and disbursements as the trust shall deem
necessary.

3. Any pledge by a trust of, or security interest granted in,
earnings, revenues or other monies, including tax-equivalency payments,
accounts, contract rights, general intangibles or other personal
property shall be valid and binding from the time when the pledge is
made; the earnings, revenues or other monies so pledged and thereafter
received by the trust shall immediately be subject to the lien of such
pledge or other security interest, without any physical delivery of the
collateral thereof or further act, and the lien of any such pledge or
other security interest shall be valid and binding as against all
parties having claims of any kind in tort, contract or otherwise against
the trust irrespective of whether such parties have notice thereof. No
resolution or any other instrument by which a pledge or other security
interest is created need be recorded, and no notice thereof need be
filed in any public office.

4. In the discretion of a trust, the bonds may be secured by a trust
indenture, which may contain any lawful provisions for protecting and
enforcing the rights and remedies of the bondholders, by and between the
trust and a corporate trustee, as distinguished from a member of the
board of trustees of a trust, which may be any trust company or bank
having the powers of a trust company in the state. A trust may provide
by such trust indenture for the payment of the proceeds of the bonds and
the revenues of a combined-use facility or cultural facility authorized
by this article to the trustee under such trust indenture or other
depository, and for the method of disbursement thereof, with such
safeguards and restrictions as it may determine. If the bonds shall be
secured by a trust indenture the bondholders shall have no authority to
appoint a separate trustee to represent them.