1991-11-01 - Laserfiche WebLink

Home Browse Search

the operation of the System, provided that all revenues derived from the disposition of such properties shall be deposited in the Water and Sewer Revenue Fund. Section 20. (a) There shall be a statutory mortgage lien upon the System, which shall exist in favor of the holders and registered owners of the Bonds until payment in full of the interest on and principal of the Bonds; and the System shall remain subject to such statutory mortgage lien until payment in full of the principal of and interest on the Bonds. Such statutory mortgage lien shall be interpreted according to the decision in City of Harrison v. Braswell, above. (b) If there be any default in the payment of the principal of or interest on any of the Bonds, or if the City defaults in any Bond Fund requirements or in the performance of any of the other covenants contained and set forth in this Ordinance, the Trustee may, and upon the written request of the holders and registered owners of not less than ten percent (10%) in principal amount of the Bonds then outstanding shall, by proper suit compel the performance of the duties of the officials of the City under the laws of Arkansas. And in the case of a default in the payment of the principal of and interest on any of the Bonds, the Trustee may, and upon the written request of holders or registered owners of not less than ten percent (10%) in principal amount of the Bonds then outstanding shall, apply in a proper action to a court of competent jurisdiction for the appointment of a receiver to administer the System on behalf of the City and the holders and registered owners with power to charge and collect (or by mandatory injunction or otherwise to cause to be charged and collected) rates sufficient to provide for the payment of the expenses of operation, maintenance and repair and to pay any Bonds and interest outstanding and to apply the revenue in conformity with the laws of Arkansas and with this Ordinance. When all defaults in principal and interest payments have been cured, the custody and operation of the System shall revert to the City. (c) No holder or registered owner of any of the out- standing Bonds shall have any right to institute any suit, action, mandamus or other proceeding in equity or at law for the protection or enforcement of any right under this Ordinance or under the laws of Arkansas unless such holder or registered owner previously shall have given to the Trustee written notice of the default on account of which such suit, action or proceeding is to be taken, and unless the holders and registered owners of not less than ten percent (10%) in principal amount of the Bonds then outstanding shall have made written request of the Trustee after the right to exercise such powers or right of action, as the case may be, shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers herein granted or granted by the laws of Arkansas, or to institute such action, suit or proceeding in its name, and unless, also, there shall have been offered to the Trustee reasonable security and indemnity against the costs, expenses and liabilities to be incurred therein w1,1my\bQtct.oa2 —21-