Such bonds shall be issued in all respects as provided by article 1 of chapter 1 of this title (s. 40:1-1 et seq.), except that no filing of a supplemental debt statement shall be required and that such bonds may either be sold for cash and the purchase price of such water distribution system paid in cash, or such bonds may be delivered to such adjoining municipality in full or partial payment of such purchase price, and in that event may be disposed of by such adjoining municipality pursuant to resolution of its governing body. In making payment for such water distribution system, due regard and provision shall be given to any amount due for water supplied to such adjoining municipality under an existing contract for the supply of water, and to any liabilities, liquidated or unliquidated, incurred by such adjoining municipality with respect to such water distribution system, and to any other items of debt between the two municipalities.