Massachusetts General Laws
Chapter 121c - Economic Development and Industrial Corporations
Section 10 - Debentures; Issuance Authorized; Trust Agreements as Security

Section 10. To provide funds for the general purposes of the corporation, including working capital, the corporation may from time to time issue debentures; provided, however, that such debentures outstanding at any one time shall not exceed five million dollars unless specifically approved by MOBD and the director. Such debentures unless otherwise authorized by law shall not be deemed to constitute a debt of the commonwealth or of the municipality or a pledge of the faith and credit of the commonwealth or of the municipality and shall be subordinated to all other obligations of the corporation and shall be payable at such time or times and in such installments, if any, as the corporation shall determine, but solely out of the net assets of the corporation; and the holders thereof shall be entitled to interest thereon but only out of the net earnings of the corporation, and in no event at a rate higher than the rate specified therein.
Such debentures may be secured by a trust agreement by and between the corporation and a corporate trustee, which shall be located within the commonwealth and shall be a trust company or bank having the powers of a trust company. Such trust agreement shall contain such provisions for protecting and enforcing the rights and remedies of the debenture holders as may be reasonable and proper and not in violation of law. It shall be lawful for any bank or trust company incorporated under the laws of the commonwealth which may act as depository under such trust agreement to furnish such indemnifying bonds or to pledge such securities as may be required by the corporation. Such trust agreement shall set forth the rights and remedies of the debentureholders and of the trustee, and may restrict the individual right of action by debentureholders. In addition to the foregoing, such trust agreement may contain such other provisions as the corporation may deem reasonable and proper for the security of the debentureholders. All expenses incurred in carrying out the provisions of such trust agreement may be treated as an item of current expense.

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