Sec. 5. (a) Bonds issued under this chapter may be secured by a trust agreement between the commission and a corporate trustee, which may be any trust company or bank having the powers of a trust company in Indiana.

     (b) A resolution adopted by the commission providing for the issuance of bonds, and any trust agreement under which the bonds are issued, may pledge or assign all or any part of the revenues received by the commission except that part necessary:

(1) to pay the cost of the commission’s administrative operation, maintenance, and repair expenses, and to provide reserves for those expenses; and

(2) for depreciation reserves required by a bond resolution or trust agreement of the commission.

     (c) The commission may not mortgage any property.

     (d) When authorizing the issuance of bonds for a project, the commission may:

(1) limit the amount of bonds that may be issued as a first lien and charge against the revenues pledged to the payment of the bonds; or

(2) authorize the later periodic issuance of additional bonds secured by the same lien to provide funds:

(A) for the completion of the project on account of which the original bonds were issued; or

(B) to pay the cost of additional projects.

The commission may issue additional bonds only on terms and conditions provided in the bond resolution adopted by the commission, in a trust agreement, or in a supplemental agreement. The additional bonds may be secured equally and ratably without preference, priority, or distinction with the original issue of bonds or may be made junior to the original issue.

     (e) A pledge or an assignment made by the commission is valid and binding from the time the pledge or assignment is made. Revenues pledged and received by the commission are immediately subject to the lien of the pledge or assignment without physical delivery or further act. The lien of the pledge or assignment is valid and binding against all parties having claims of any kind against the commission, whether or not the parties have notice. Neither the resolution nor a trust agreement by which a pledge is created or assignment made need be filed or recorded except in the records of the commission.

     (f) A trust agreement or a resolution providing for the issuance of bonds may contain reasonable provisions for protecting and enforcing the rights and remedies of the bondholders.

     (g) A bank or trust company incorporated under the laws of the state and acting as the depository of the proceeds of bonds or other funds of the commission may furnish indemnifying bonds or pledge securities as required by the commission.

     (h) A trust agreement may do the following:

(1) Set forth the rights and remedies of the bondholders and the trustee.

(2) Restrict the individual right of action by bondholders as is customary in trust agreements or trust indentures securing bonds or debentures of private corporations.

(3) Contain other provisions the commission considers reasonable and proper for the security of the bondholders.

     (i) All expenses incurred in carrying out the provisions of a trust agreement may be treated as a part of the cost of the operation of the project.

[Pre-2008 Recodification Citation: 15-1.5-9-4.]

As added by P.L.2-2008, SEC.4.