§11-50-407. Provisions in mortgages, deeds of trust, etc., executed as security for bonds as to rights of parties thereto, etc.; execution, etc., of contracts as security for repayment of moneys borrowed.

(a) Any mortgage, deed of trust or pledge agreement made by any district incorporated under this article for the security of any of its bonds or to define the rights, remedies and privileges of the holders of such bonds and the duties of the district to such holders may contain such agreements, obligations, covenants and provisions as the board of directors may deem advisable respecting the operation and maintenance of the gas system or systems and the collection and application of the revenues subject to such mortgage, deed of trust or pledge agreement and respecting the rights and duties of the parties to such instrument or the parties for the benefit of whom such instrument is made, with it being expressly provided that any such mortgage or deed of trust may be subject to the sale of the system or systems at foreclosure to utility companies or corporations regulated by the Alabama Public Service Commission.

(b) To further secure the repayment of any money borrowed by it, any such district may enter into a contract or contracts binding itself for the proper application of the money borrowed, for the continued operation and maintenance of any gas system or systems owned or to be acquired or constructed by it or any part or parts thereof, for the imposition and collection of reasonable rates for and the promulgation of reasonable regulations respecting any service furnished from its gas system or systems, for the disposition and application of its gross revenues or any part thereof and for any other act or series of acts not inconsistent with the provisions of this article for the protection of the loan and the assurance that the revenues from its gas system or systems will be sufficient to operate such system or systems, maintain the same in good repair and in good operating condition, pay all reasonable insurance thereon, pay the principal of and interest on any bonds payable from such revenues and maintain such reserves and funds as may be deemed appropriate for the protection of the loan and the efficient operation of such system or systems.

(Acts 1951, No. 762, p. 1319, §11; Acts 1969, No. 634, p. 1161, §2.)