40:37B-27 - Default by authority; appointment of trustee; powers and duties - New Jersey Statutes

40:37B-27.  Default by authority;  appointment of trustee;  powers and duties
    (a) If the bond resolution of an authority authorizing or providing for the  issuance of a series of its bonds shall provide in substance that the holders  of the bonds of such series shall be entitled to the benefits of this section,  then if there shall be a default in the payment of principal of or interest on  any bonds of such series after the same shall become due, whether at maturity  or upon call for redemption, and such default shall continue for a period of 30  days, or if the authority shall fail or refuse to comply with any of the  provisions of this act or shall fail or refuse to carry out and perform the  terms of any contract with the holders of any such bonds and such failure or  refusal shall continue for a period of 30 days after written notice to the  authority of its existence and nature, the holders of 25% in aggregate  principal amount of the bonds of such series then outstanding by instrument or  instruments filed in the office of the Secretary of State and proved or  acknowledged in the same manner as a deed to be recorded, may appoint a trustee  to represent the holders of the bonds of such series for the purposes provided  in this section.

    (b) Such trustee may, and upon written request of the holders of 25% in aggregate principal amount of the bonds of such series then outstanding shall, in his or its own name:

     (1) By any action or proceeding, enforce all rights of the holders of such  bonds, including the right to require the authority to charge and collect  facility charges adequate to carry out any contract as to, or pledge of,  facility revenues, and to require the authority to carry out and perform the  terms of any contract with the holders of such bonds or its duties under this  act;

     (2) Bring an action upon all or any part of such bonds or interest coupons  or claims appurtenant thereto;

     (3) By action, require the authority to account as if it were the trustee of an express trust for the holders of such bonds;

     (4) By action, enjoin any acts or things which may be unlawful or in violation of the rights of the holders of such bonds;  or

     (5) Declare all such bonds due and payable, whether or not in advance of maturity, upon 30 days' prior notice in writing to the authority and, if all defaults shall be made good, then with the consent of the holders of 25% of the  principal amount of such bonds then outstanding, annul such declaration and its  consequences.

    (c) Such trustee shall, in addition to the foregoing, have and possess all of the powers necessary or appropriate for the exercise of the functions specifically set forth herein or incident to the general representation of the holders of bonds of such series in the enforcement and protection of their rights.

    (d) In any action or proceeding by such trustee, the fees, counsel fees and  expenses of the trustee and of the receiver, if any, appointed pursuant to this  act, shall, if allowed by the court, constitute taxable costs and disbursements, and all costs and disbursements, allowed by the court, shall be a first charge upon any facility charges and facility revenues of the authority  pledged for the payment or security of bonds of such series.

     L.1967, c. 136, s. 27, eff. June 28, 1967.