Delaware § 1412 - Trust agreements to secure bonds; pledges and assignments; contents of authorizing resolutions; depositaries for bond sales proceeds.

§ 1412. Trust agreements to secure bonds; pledges and assignments; contents of authorizing resolutions; depositaries for bond sales proceeds.

(a) In the discretion of the authority, any revenue bonds issued under this chapter may be secured by a trust agreement by and between the authority and a corporate trustee, which may be any trust company or bank having the powers of a trust company.

(b) (1) The resolution authorizing the issuance of the bonds or the trust agreement may pledge or assign the revenues to be received from the operation of the project or projects on account of which the bonds are issued and, in the case of bonds issued to finance a sewerage system, may pledge or assign as security for such bonds the revenues to be received from its water system to the extent authorized by § 1411 of this title, but shall not convey or mortgage any project or any part thereof, and may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable and proper and not in violation of law, including covenants setting forth the duties of the authority in relation to the acquisitions, construction, improvement, maintenance, operation, repair and insurance of the project or projects on account of which such bonds are issued, and provisions for the custody, safeguarding and application of all moneys and for the employment of consulting engineers in connection with such construction, reconstruction or operation.

(2) Such resolution or trust agreement may set forth the rights and remedies of the bondholders and of the trustees in the case of a trust agreement and may restrict the individual right of action by bondholders as is customary in trust agreements or trust indentures securing bonds or debentures of corporations.

(3) In addition to the foregoing, such resolution or trust agreement may contain such other provisions as the authority may deem reasonable and proper for the security of the bondholders.

(c) Except as is in this chapter otherwise provided, the authority may provide for the payment of the proceeds of the sale of the bonds and its revenues to such officer, board or depositary as it may designate for the custody thereof and for the method of disbursement thereof, with such safeguards and restrictions as it may determine.

(d) All expenses incurred in carrying out such resolution or trust agreement may be treated as a part of the cost of operation of the project or projects.

16 Del. C. 1953, §  1412;  49 Del. Laws, c. 417.;