Sec. 8. (a) The refunding bonds shall be special obligations of the issuing body and shall be payable from and secured by a lien upon the revenues of the enterprise, as shall be more fully described in the ordinance or resolution of the governing body authorizing the issuance of the refunding bonds, and, subject to the constitution and to the prior or superior rights of any person, any issuing body shall have power by ordinance or resolution of its governing body to pledge and assign for the security of the refunding bonds all or any part of the gross or the net revenues of such enterprise.

(b) As additional security for any issue of refunding bonds hereunder, or any part thereof, any issuing body shall have power, and is hereby authorized, by ordinance or resolution of its governing body to confer upon the holders of the refunding bonds all rights, powers and remedies which said holders would be entitled to if they were the owners and had possession of the notes, bonds or other obligations for the refinancing of which such refunding bonds shall have been issued including, but not limited to, the preservation of the lien of such notes, bonds or other obligations without extinguishment, impairment or diminution thereof. In the event any issuing body exercises the power conferred by this subsection:

(1) each refunding bond shall contain a recital to the effect that the holder thereof has been granted the additional security provided by this subsection; and

(2) each note, bond or other obligation of the issuing body to be refinanced by any such refunding bonds, shall be kept intact and shall not be cancelled or destroyed until the refunding bonds, and interest thereon, have been finally paid and discharged but shall be stamped with a legend to the effect that such note, bond, or other obligation has been refunded pursuant to this chapter.

(c) All refunding bonds of the same issue shall be equally and ratably secured, without priority by reason of number, date of bonds, of sale, of execution or of delivery, by a lien upon the revenues of the enterprise in accordance with the provisions of this section and the ordinance or resolution authorizing the issuance of such refunding bonds.

(d) Nothing in this section or in any other section of this chapter shall be deemed in any way to alter the terms of any agreements made with the holders of any outstanding notes, bonds, or other obligations of the issuing body or to authorize the issuing body to alter the terms of any such agreements, or to impair, or to authorize the issuing body to impair the rights and remedies of any creditors of the issuing body.

(e) Nothing in this section or any other section of this chapter shall be deemed in any way to authorize any issuing body to do anything in any manner or for any purpose which would result in the creation or incurring of a debt or indebtedness or the issuance of any instrument which would constitute a bond or debt within the meaning of any provision, limitation, or restriction of the constitution relating to the creation or incurring of a debt or indebtedness or the issuance of an instrument constituting a bond or debt.

[Pre-Local Government Recodification Citation: 19-8-7-8.]

As added by Acts 1980, P.L.8, SEC.10.