§ 45-12-5.1 - Callable bonds.
SECTION 45-12-5.1
§ 45-12-5.1 Callable bonds. – (a) Bonds issued by any cities, towns or other political subdivisions of thisstate may be issued subject to call and prepayment prior to their statedmaturities at the option of the issuer. All, or less than all, of the bondscomprising an issue may be subject to call simultaneously or from time to time.
(b) Every bond issued subject to prepayment shall indicate:
(1) That the bond is subject to call and prepayment;
(2) The time or times at which the bond may be prepaid;
(3) The schedule of premiums, if any, which are payable; and
(4) The time and type of notice which must be given by theissuer before the bond can be prepaid.
(c) The coupons, if any, attached to the bonds shall, asappropriate, indicate that they may become void as a result of the bond beingcalled for prepayment. Unless otherwise provided in the proceedings authorizingthe issue of bonds, the officers of the city, town or other politicalsubdivision authorized to sell the bonds shall determine whether the bondsshall be issued subject to call and prepayment, and if issued, the officersshall decide the details of these bonds. No bond shall be called forprepayment, unless the issuer has deposited with the paying agent or agents forthe bond for prepayment a sufficient amount of cash, or securities issued bythe United States of America, the state of Rhode Island, or its politicalsubdivisions, with maturities and interest rates adequate to provide asufficient amount of cash, to pay the bond in full on the date on which it isprepayable. The notice may state: (1) that it is conditioned on the deposit ofmoneys, in an amount necessary to effect the redemption with the paying agentor agents no later than the redemption date; and/or (2) that the city, town orpolitical subdivision retains the right to rescind such notice on or prior tothe scheduled redemption date, and such notice and optional redemption shall beof no effect if such monies are not so deposited or if the notice is rescinded.Bonds may be prepaid with the proceeds of refunding bonds as provided in thefollowing section, or with other funds available for that purpose; and cities,towns and other political subdivisions may raise money by taxation for thepurpose of prepaying bonds. For the purposes of this section "bond" shallinclude note. The powers conferred by this section may be used with regard tobonds authorized for any purpose by any general, special, or other law,including § 45-12-5.2.