9-441.04. Additional security for bonds

485 words·~2 min read·/az/title-9/9-441-04

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

A. In connection with the issuance of bonds pursuant to section 9-441.03, or the incurring of obligations under leases, and in order to secure the payment of these bonds or obligations, a municipality, in addition to its other powers, may:

1. Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which shall consent to and the manner in which the consent may be given.

2. Vest in any obligees the right to enforce the payment of the bonds or any covenants securing or relating to the bonds.

3. Vest in any obligee holding a specified amount of such bonds the right, in the event of a default, to take possession of and use, operate and manage any housing development area or any part of the area, title to which is in the municipality, or any monies connected with the development, to collect the rents and revenues arising from the development and to dispose of the monies in accordance with the agreement of the municipality with such obligees.

4. Provide for the powers and duties of the obligees and limit the liabilities of the obligees.

5. Provide the terms and conditions on which the obligees may enforce any covenant or rights securing or relating to the bonds.

6. Exercise all or any part or combination of the powers granted by this subsection.

7. Make covenants and do any and all acts and things necessary, convenient or desirable to secure its bonds, or, in the discretion of the municipality, as will tend to make the bonds more marketable even if the covenants, acts or things are not enumerated in this section.

B. A municipality, by its resolution, trust indenture, mortgage, lease or other contract, may confer on any obligee holding or representing a specified amount in bonds issued pursuant to section 9-441.03 the right, in addition to all rights that may otherwise be conferred, on the happening of an event of default as defined in such resolution or instrument, by an action or proceeding in any court of competent jurisdiction, both of the following:

1. To require the municipality and its officials, agents and employees to account as if it and they were the trustees of an express trust.

2. To obtain the appointment of a receiver of any housing development area of the municipality or any part of the area, title to which is in the municipality, and of the rents and profits from the development.

C. If a receiver is appointed, the receiver may enter and take possession of, carry out, operate and maintain the housing development area or any part of the area and collect and receive all fees, rents, revenues or other charges and shall keep monies in a separate account and apply them in accordance with the obligations of the municipality as the court directs.