Pennsylvania § 8106 - Sinking fund depository and trustee for bondholders or noteholders.

§ 8106. Sinking fund depository and trustee for bondholders or noteholders.

(a) General rule.--Every local government unit issuing bonds or notes other than notes issued under section 8109 (relating to small borrowing for capital purposes) shall appoint a sinking fund depository which may also serve as paying agent for the bonds or notes. The sinking fund depository shall be a bank or bank and trust company authorized to do business in this Commonwealth and may serve as one for one or more series of bonds or notes. Funds, which may include interest accrued and to accrue on lawful investments, in an amount sufficient for the payment of the principal of and the interest on the bonds or notes shall be deposited with the sinking fund depository not later than the date fixed for the disbursement thereof unless the ordinance authorizing the issuance of the bonds or notes requires that the deposits be made on an earlier date or on earlier dates.

(b) Fiscal agent or trustee.--If the ordinance authorizing the issuance of the bonds or notes provides for a fiscal agent or authorizes the execution of a trust indenture appointing a trustee, the fiscal agent or trustee shall also be the sinking fund depository.

(c) Remedy for failure to make deposit.--If the local government unit shall fail or refuse to make any required deposit in the sinking fund, the sinking fund depository, the fiscal agent or the trustee, as the case may be, may and, upon request of the holders of 25% in principal amount of the outstanding notes and bonds and upon being indemnified against cost and expense, shall exercise any remedy provided in this subpart or at law or in equity for the equal and ratable benefit of the holders of the outstanding notes, bonds and coupons and shall disburse all funds so collected equally and ratably to the holders of the notes, bonds and coupons as provided in the ordinance authorizing the bonds, subject to any limitations contained in Subchapter D of Chapter 82 (relating to remedies).