§99.15. Security for payment of bonds; provisions of trust indenture or resolution

A. In the discretion of the board, any bonds issued, and any ancillary contracts or swaps made under the provisions of this Subpart, may be secured by a trust indenture by and between the corporation and the indenture trustee, which may be any trust company or bank having the powers of a trust company, whether located within or without the state. Such trust indenture, or the resolution of the board providing for the issuance of such bonds, may:

(1) Pledge or assign all or any part of the income or other assets of the corporation available for such purpose.

(2) Provide for the creation and maintenance of such reserves as the board shall determine to be proper.

(3) Include covenants setting forth the duties of the corporation in relation to the bonds, the income of the corporation, the related agreement and the tobacco assets.

(4) Contain provisions respecting the custody, safeguarding and application of all monies and securities and such provisions for protecting and enforcing the rights and remedies (pursuant thereto and to the related agreement) of the holders and other beneficiaries as may be reasonable and proper and not in violation of law.

(5) Contain such other provisions as the corporation may deem reasonable and proper for priorities and subordination among the holders and other beneficiaries. Any reference in this Subpart to a resolution of the board shall include any trust indenture authorized thereby.

B. Any pledge or security interest made by the corporation shall be valid and binding from the time when the pledge or security interest is made. The income or other assets so pledged and then or thereafter received by the corporation shall immediately be subject to the lien of such pledge or security interest without any physical delivery thereof or further act, and the lien of any such pledge or security interest shall be valid and binding as against all parties asserting or having claims of any kind in tort, contract or otherwise against the corporation, irrespective of whether such parties have notice thereof. Neither the resolution nor any other instrument by which a pledge or security interest is created need be recorded or filed to perfect such pledge or security interest.

C. Whether or not the bonds are of such form and character as to be negotiable instruments under the provisions of the Uniform Commercial Code, the bonds are hereby made negotiable instruments for all purposes, subject only to the provisions of the bonds for registration.

Acts 2001, No. 1145, §1.