63B-1-309 - Securing of obligations -- Provisions in mortgages given as security -- Procedure upon default.
63B-1-309. Securing of obligations -- Provisions in mortgages given as security --Procedure upon default.
(1) The principal and interest on any obligation issued under this part:
(a) shall be secured by a pledge and assignment of the revenues out of which thatobligation shall be made payable;
(b) may be secured by a mortgage covering all or any part of the facility for which therevenues from the obligation were used;
(c) may be secured by a pledge and assignment of the lease of that facility; and
(d) may be secured by any other security device on that facility that is considered mostadvantageous by the authority.
(2) (a) The proceedings under which the obligations are authorized to be issued underthis part and any mortgage given to secure the obligations may contain any agreements andprovisions customarily contained in instruments securing obligations, including, but not limitedto, provisions respecting:
(i) the fixing and collection of rents for any facility covered by the proceedings ormortgage;
(ii) the terms to be incorporated in the lease of that facility;
(iii) the operation, maintenance, and insurance of that facility;
(iv) the creation and maintenance of special reserve or other funds and accounts from theproceeds of sale of obligations or from the revenues of that facility; and
(v) the rights and remedies available in the event of a default to the holders of obligationsor to the trustee under a mortgage, as the authority may determine in accordance with this part.
(b) All these mortgages, trust deeds, security agreements, or trust indentures shallprovide that no deficiency judgment upon foreclosure may be entered against the authority, thisstate, or any of its political subdivisions.
(3) The proceedings authorizing obligations under this part, and any mortgage securingthese obligations, may provide that, if there is a default in the payment of the principal of or theinterest on these obligations or in the performance of any agreement contained in the proceedingsor mortgage, the payment or performance may be enforced by the appointment of a receiverrelative to that facility with power to charge and collect rents and to apply the revenues from thefacility in accordance with the proceedings or the provisions of the mortgage.
(4) (a) Any mortgage made under this part to secure obligations issued pursuant to it mayalso provide that, in the event of a default in the payment of the mortgage or the violation of anyagreement contained in the mortgage, the mortgage may be foreclosed or otherwise realized on inany manner permitted by law.
(b) The mortgage may also provide that any trustee under the mortgage or the holder ofany of the obligations secured by the mortgage may become the purchaser at any foreclosure sale,if that trustee is highest bidder.
(c) A breach of the agreement does not impose any general obligation or liability upon,nor a charge against, the authority or the general credit or taxing power of this state or any of itspolitical subdivisions.
Renumbered and Amended by Chapter 86, 2003 General Session