36-491

36-491. Issuance of bonds

A. The board is authorized, for and on behalf of the authority, to issue bonds for
the purpose of improving health care for residents of this state by providing less
expensive financing for one or more health care facilities.

B. Such bonds may be issued in one or more series, bear such date or dates, be in
such denomination or denominations, mature at such time or times, not exceeding forty
years from the respective dates thereof, mature in such amount or amounts, bear interest
at such rate or rates payable at least annually, be in such form either coupon or
registered, carry such registration privileges, be executed in such manner, be payable in
such medium of payment, at such place or places, be refundable either at or in advance of
maturity, be subject to such terms of redemption, with or without premium, as the board
directs. The bonds may be sold at either public or private sale in such manner and upon
such terms as may be determined by the board to be most advantageous, with appropriate
disclosures of all material information relating to the bonds and the security
therefor. Such bonds shall be fully negotiable within the meaning and for all purposes
of title 47. Such bonds and interest thereon shall be exempt from all taxes of the state
or any of its political subdivisions.

C. Principal and interest on the bonds shall be payable solely from the revenues
derived by the authority from the agreements authorized by this chapter. Unless agreed
to in writing by each participating facility affected, the authority shall not pledge for
the payment of the bonds issued for acquisition of any health care facility payments
received from another participating facility.

D. Any agreement authorizing the issuance of bonds may provide for:

1. Execution of a trust indenture and assignment to a trustee of the agreements
relating to the health care facility to be acquired by the series or issue of bonds in
order to protect the bondholder or bondholders and facilitate the payment of the
principal and interest on the bonds.

2. Payment of the bonds solely from the monies paid by the obligated participating
facility or facilities.

3. Capitalization of a bond reserve from bond proceeds or other payments made by
the participating facility when the board deems necessary.

4. Limitations on the issuance of future bonds or restrictions or formulas relative
to the issuance of future bonds of equal or secondary lien, or for a lien upon or pledge
of the revenues received from or by any participating facility.

5. Restrictions as to liens, encumbrances or alienation of any project or health
care facility.

6. Covenants as to the procedures by which the terms of any agreement for the
benefit of a holder or holders of such bonds may be amended or abrogated, the amount or
percentage of bonds the holder or holders of which must consent thereto and the manner in
which such consent may be given.

7. Assignment to a trustee of any or all agreements made or entered into by the
authority and vesting in the trustee the right to enforce any covenant made to secure or
pay the bonds.

8. Execution and delivery of trust agreements setting forth the powers, duties and
remedies available to trustees, limiting liabilities, describing what occurrences shall
constitute default and prescribing terms and conditions upon which trustees or holders of
bonds of any specified amount or percentage of such bonds may exercise and enforce any
rights, covenants and remedies.

9. Vesting in a trustee or holder of any specified amount or percentage of bonds
the right to apply to any court of competent jurisdiction for, and have granted, the
appointment of a receiver to act under the terms of any agreement.

10. A provision for reclamation of the facility if a payment required under an
agreement or any other condition required in an agreement is not timely paid or is
breached.

11. A provision for the appointment of a receiver to operate the facility during a
period of default in the regular payment or performance under an agreement.

12. A prohibition against the leasing or subleasing of the facility without the
specific written permission of the authority to any other project operator.

E. Bonds bearing the signatures of officers in office on the date of the signing
thereof shall be valid and binding obligations, notwithstanding that before delivery and
payment therefor any or all persons whose signatures appear thereon shall have ceased to
be officers of the authority. The validity of the bonds shall not be dependent on nor
affected by the validity or regularity of any proceedings to acquire the project financed
by the bonds or taken in connection therewith. No action shall be brought questioning
the legality of any agreement, proceedings or issuance of bonds hereunder after two
months from the date the bonds are authorized to be issued by the board.