§ 14-234-208 - Lien in favor of bondholders -- Enforcement -- Appointment of receiver upon default. - Arkansas Statutes

14-234-208. Lien in favor of bondholders -- Enforcement -- Appointment of receiver upon default.

(a) (1) There shall be created a statutory mortgage lien upon the waterworks system acquired or constructed from the proceeds of bonds authorized to be issued.

(2) The lien shall exist in favor of the holder of the bonds, and each of them, and to and in favor of the holder of the coupons attached to the bonds.

(3) The waterworks system shall remain subject to the statutory mortgage lien until payment in full of the principal and interest of the bonds.

(b) Subject to whatever restrictions may be contained in the indenture authorized in this subchapter, any holder of bonds issued under the provisions of this subchapter or of any coupons representing interest accrued thereon may, either at law or in equity, enforce the statutory mortgage lien and may, by proper suit, compel the performance of the duties of the officials of the issuing municipality set forth in this subchapter.

(c) If there be default in the payment of the principal of or interest upon any of the bonds, any court having jurisdiction in any proper action may appoint a receiver to administer the waterworks system on behalf of the municipality with power to charge and collect rates sufficient to provide for the payment of the bonds and interest thereon, and for the payment of the operating expenses and to apply the income and revenues in conformity with this subchapter and the ordinance providing for the issuance of the bonds.