Security for Bonds Flow of Funds Investments Clause Samples
The 'Security for Bonds; Flow of Funds; Investments' clause establishes how funds related to bond issuances are managed, secured, and invested. It typically outlines the creation of specific accounts or funds where bond proceeds and related revenues are deposited, details the order in which these funds are used to pay expenses, debt service, and other obligations, and sets guidelines for how any surplus funds may be invested. For example, it may require that all revenues from a financed project be deposited into a designated account, with payments made first to bondholders before any other uses. The core function of this clause is to protect bondholders by ensuring that there is a clear, prioritized process for handling funds, thereby reducing the risk of mismanagement or diversion of monies intended for debt repayment.
Security for Bonds Flow of Funds Investments. Section 5.01. Pledge; Special Obligations 27 Section 5.02. Flow of Funds 27 Section 5.03. Application of Net Insurance Proceeds 28 Section 5.04. Title Insurance 29 Section 5.05. Reserve Fund 30 Section 5.06. Rebate Fund 31 Section 5.07. Investment of Moneys 31 Section 6.01. Compliance with Agreements 33 Section 6.02. Compliance with Lease Agreement 33 Section 6.03. Observance of Laws and Regulations 33 Section 6.04. Other Liens 33 Section 6.05. Prosecution and Defense of Suits 34 Section 6.06. Accounting Records and Statements 34 Section 6.07. Recordation and Filing 34 Section 6.08. Tax Covenants 34 Section 6.09. Continuing Disclosure 38 Section 6.10. Further Assurances 38
Security for Bonds Flow of Funds Investments