Article 3. Equipment Trust Certificates of California Public Utilities Code >> Division 10. >> Part 3. >> Chapter 7. >> Article 3.

The district shall have power to purchase equipment such as cars, trolley buses and motorbuses, rolling equipment, and may execute agreements, leases and equipment trust certificates in the forms customarily used by private corporations engaged in the rapid transit business appropriate to effect such purchase and leasing of rolling equipment and may dispose of such equipment trust certificates upon such terms and conditions as the board may deem appropriate. All money required to be paid by the district under the provisions of such agreements, leases and equipment trust certificates shall be payable solely from the revenue or income to be derived from the transportation system and from grants or loans, or both, as provided in Sections 30701, 30702, and 30703 of this part. Payment for such equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable solely from such revenue, income, grants, or loans, and title to such equipment shall not vest in the district until the equipment trust certificates are paid.

The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, lessor or vendor for the benefit and security of the equipment trust certificates and may direct such trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the district.

The agreements and leases shall be duly acknowledged before some person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds and such agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from such revenue, income, grants or loans.

The covenants, conditions and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any agreement securing the payment of bonds, notes or certificates of the district.