Article 16. Acquisition And Cancellation Of Bonds Of Nonconsenting Bondholders of California Government Code >> Division 1. >> Title 6. >> Chapter 5. >> Article 16.

If the holders of one or more of the original bonds do not enter any proposal or contract with the legislative body to refund the bonds but the holders of 75 percent or more of the bonds do contract with the legislative body which conducts the proceedings, it may refund all of the bonds pursuant to this chapter. In such event, prior to recording the reassessment, sufficient money to provide adequately for the retirement or payment of the original bonds of the nonconsenting holders shall be set aside in the proper fund for that purpose.

Any local agency authorized by this chapter to appropriate money to aid in refunding the original bonds of the district may make an advancement, contribution, or an additional contribution to provide money to pay or retire bonds of the nonconsenting holders.

When any local agency, person, or corporation advances money for the payment or retirement of the original bonds of nonconsenting holders, the legislative body may deliver at par all or part of the new bonds which are not to be delivered to consenting bondholders to such local agency, person, or corporation, or sell at par all or part of such bonds, and from the proceeds wholly or partly reimburse such local agency, person, or corporation. The legislative body may contract to make such sale or delivery.

If the legislative body makes all or part of such advancement it may reimburse the local agency of which it is the legislative body, entirely or partially by taking all or part of such new bonds at par.

Any cash collected on reassessments and not required to pay consenting bondholders may also be used to reimburse in whole or in part any local agency, person, or corporation making the advance, and the legislative body may contract to so apply such cash.

The legislative body may use any other method of raising funds for the payment or retirement of the original bonds of nonconsenting bondholders which will adequately provide the money necessary for such payment or retirement prior to the recordation of the reassessment.

When money is placed in any fund for the retirement or payment of the original bonds of nonconsenting holders it shall be used only for that purpose. After all the original bonds of nonconsenting holders have been paid or retired, any sum remaining in the fund shall be returned to the local agency which advanced it.

If the proposals or contract with the bondholders so provides, the legislative body may sell all of the new bonds for cash and pay the bondholders in cash at a price to be fixed in the proposals or contract.

If the discharge of the original bonds of any nonconsenting holders at less than par has been authorized by any final decree or order confirming a plan of readjustment pursuant to a federal bankruptcy law in any proceedings initiated pursuant to this chapter, the legislative body may perform all acts necessary to discharge the bonds pursuant to the decree or order.