CHAPTER 3. SWAP AGREEMENTS

IC 21-29-3
    Chapter 3. Swap Agreements

IC 21-29-3-1
Liberal construction
    Sec. 1. This chapter applies notwithstanding any other law. Thischapter shall be liberally construed.
As added by P.L.2-2007, SEC.270.

IC 21-29-3-2
Investment powers
    Sec. 2. This chapter shall not be construed as limiting orrestricting the investment powers otherwise provided stateeducational institutions, including the power to adopt and implementinvestment policies under IC 21-29-2-1 and IC 21-29-2-2.
As added by P.L.2-2007, SEC.270. Amended by P.L.79-2010, SEC.1.

IC 21-29-3-3
Powers and duties of state educational institutions
    Sec. 3. (a) Subject to subsections (b) through (d), any stateeducational institution may enter into and modify, amend, orterminate one (1) or more swap agreements that the state educationalinstitution determines to be necessary or desirable in connection withor incidental to the issuance, carrying, or securing of obligations.Swap agreements entered into by a state educational institution must:
        (1) contain the provisions (including payment, term, security,default, and remedy provisions); and
        (2) be with the parties;
that the state educational institution determines are necessary ordesirable after due consideration is given to the creditworthiness ofthe parties.
    (b) A state educational institution may not:
        (1) enter into, modify, amend, or terminate any swap agreementwithout the specific approval of the public finance directorappointed under IC 4-4-11-9;
        (2) enter into any swap agreement under this section other thanfor the purpose of managing an interest rate or similar risk thatarises in connection with or incidental to the issuance, carrying,or securing of obligations by the state educational institution; or
        (3) carry on a business of acting as a dealer in swap agreements.
    (c) A swap agreement is considered as being entered into inconnection with or incidental to the issuance, carrying, or securingof obligations if:
        (1) the swap agreement is entered into not more than onehundred eighty (180) days after the issuance of the obligationsand specifically indicates the agreement's relationship to theobligations;
        (2) the board of trustees of the state educational institutionspecifically designates the swap agreement as having arelationship to the particular obligations;        (3) the swap agreement amends, modifies, or reverses a swapagreement described in subdivision (1) or (2); or
        (4) the terms of the swap agreement bear a reasonablerelationship to the terms of the obligations.
    (d) Payments to be made by a state educational institution to anyother party under a swap agreement are payable only from the samesource or sources of funds from which the related obligations arepayable.
As added by P.L.2-2007, SEC.270. Amended by P.L.182-2009(ss),SEC.365.

IC 21-29-3-4
Credit enhancement and liquidity agreements
    Sec. 4. With regard to entering into any swap agreement, the stateeducational institution may enter into credit enhancement or liquidityagreements with payment, security, default, remedy, and other termsand conditions as determined by the state educational institution.
As added by P.L.2-2007, SEC.270.

IC 21-29-3-5
Enforcement of swap agreements.
    Sec. 5. (a) This section does not apply in cases of bad faith oractual knowledge to the contrary by a party.
    (b) A party that enters into any swap agreement with a stateeducational institution may rely on a representation by that stateeducational institution that the state educational institution isauthorized or empowered to enter into the swap agreement, andnotwithstanding the failure by the state educational institution tocomply with the provisions of this chapter, that party may enforce theswap agreement against the state educational institution, subject tothe terms of the swap agreement and subject to prior claims onsources from which the swap agreement may be payable.
As added by P.L.2-2007, SEC.270.