Texas Local Government Code 372.025 – Terms and Conditions of Bonds
(a) Revenue bonds may be issued to mature serially or in any other manner but must mature not later than 40 years after their date. A provision may be made for the subsequent issuance of additional parity bonds or subordinate lien bonds under terms and conditions specified in the ordinance or order authorizing the issuance of the bonds.
(b) The bonds shall be executed and the bonds and interest coupons appertaining to them are negotiable instruments within the meaning and for all purposes of the Uniform Commercial Code (§ 1.101 et seq., Business & Commerce Code). The ordinance or order authorizing the issuance of the bonds must specify:
(1) whether the bonds are issued registrable as to principal alone or as to both principal and interest;
(2) whether the bonds are redeemable before maturity;
(3) the form, denomination, and manner of issuance;
(4) the terms, conditions, and other details applying to the bonds including the price, terms, and interest rates on the bonds; and
(5) the manner of sale of the bonds.
Terms Used In Texas Local Government Code 372.025
- Lien: A claim against real or personal property in satisfaction of a debt.
- 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
(c) The ordinance or order authorizing the issuance of the bonds may specify that the proceeds from the sale of the bonds:
(1) be used to pay interest on the bonds during and after the period of acquisition or construction of an improvement financed through the sale of the bonds;
(2) be used for creating a reserve fund for payment of the principal of and interest on the bonds and for creating other funds; and
(3) may be placed in time deposit or invested, until needed.