N.Y. Education Law § 485: Notes and bonds of the fund

§ 485. Notes and bonds of the fund. 1. (a) Subject to the provisions

of section four hundred eighty-six of this chapter, the fund shall have

the power and is hereby authorized from time to time to issue its

negotiable bonds and notes in such principal amount as, in the opinion

of the fund, shall be necessary, after taking into account other monies

which may be available for the purpose, to provide sufficient funds for

achieving its corporate purposes, including the construction,

acquisition, reconstruction, rehabilitation or improvement of the school

portion of combined occupancy structures pursuant to this article, the

payment of interest on bonds and notes of the fund, establishment of

reserves to secure such bonds and notes, and all other expenditures of

the fund incident to and necessary or convenient to carry out its

corporate purposes and powers;

(b) The fund shall have power, from time to time, to issue renewal

notes, to issue bonds to pay notes and, whenever it deem refunding

expedient, to refund any bonds by the issuance of new bonds, whether the

bonds to be refunded have or have not matured, and to issue bonds partly

to refund bonds then outstanding and partly for any other purpose. The

refunding bonds shall be sold and the proceeds applied to the purchase,

redemption or payment of the bonds to be refunded;

(c) Except as may otherwise be expressly provided by the fund, every

issue of its notes or bonds shall be general obligations of the fund

payable out of any revenues or monies of the fund, subject only to any

agreements with the holders of particular notes or bonds pledging any

particular receipts or revenues;

(d) Whether or not the notes or bonds are of such form and character

as to be negotiable instruments under the provisions of article eight of

the uniform commercial code, the notes or bonds shall be and hereby are

made negotiable instruments within the meaning of and for all the

purposes of the uniform commercial code, subject only to the provisions

of the notes or bonds for registration.

2. The notes and bonds of the fund shall be authorized by resolution

of the trustees, shall bear such date or dates, and shall mature at such

time or times, in the case of any such note, or any renewals thereof,

not exceeding five years, from the date of issue of such original note,

and in the case of any such bond not exceeding forty years from the date

of issue, as such resolution or resolutions may provide. The notes and

bonds shall bear interest at such rate or rates, be in such

denominations, be in such form, either coupon or registered, carry such

registration privileges, be executed in such manner, be payable in such

medium of payment, at such place or places and be subject to such terms

of redemption as such resolution or resolutions may provide. The notes

and bonds of the fund may be sold by the fund, at public or private

sale, at such price or prices as the fund shall determine. No notes or

bonds of the fund may be sold by the fund at private sale, however,

unless such sale and the terms thereof have been approved in writing by

the city comptroller.

3. Any resolution or resolutions authorizing any notes or bonds or any

issue thereof may contain provisions, which shall be a part of the

contract with the holders thereof, as to:

(a) pledging all or any part of the fees and charges made or received

by the fund, and all or any part of (i) the rentals or other payments to

be received by the fund with respect to the school portion of combined

occupancy structures financed with the proceeds of such bonds and notes,

and (ii) the rentals or other payments to be received by the fund with

respect to the non-school portion of combined occupancy structures and

(iii) any other monies, assets or accounts received or to be received by

the fund or pledged or assigned to the fund to secure the payment of

such notes or bonds or of any issue thereof, subject to such agreements

with bondholders or noteholders as may then exist;

(b) pledging all or any part of the assets of the fund to secure the

payment of such notes or bonds or of any issue of notes or bonds,

subject to such agreements with noteholders or bondholders as may then

exist;

(c) the use and disposition of the gross income of the fund in

connection with combined occupancy structures financed or constructed,

acquired, reconstructed, rehabilitated or improved by it or on its

behalf;

(d) the setting aside of reserves or sinking funds and the regu-

lation and disposition thereof;

(e) limitations on the purpose to which the proceeds of sale of notes

or bonds may be applied and pledging such proceeds to secure the payment

of the notes or bonds or of any issue thereof;

(f) limitations on the issuance of additional notes or bonds; the

terms upon which additional notes or bonds may be issued and secured;

the refunding of outstanding or other notes or bonds;

(g) the procedure, if any, by which the terms of any contract with

noteholders or bondholders may be amended or abrogated, the amount of

notes or bonds the holders of which must consent thereto, and the manner

in which such consent may be given;

(h) limitations on the amount of monies to be expended by the fund for

operating, administrative or other expenses of the fund;

(i) vesting in a trustee or trustees such property, rights, powers and

duties in trust as the fund may determine, which may include any or all

of the rights, powers and duties of the trustee appointed by the

bondholders pursuant to this article, and limiting or abrogating the

right of the bondholders to appoint a trustee under this article or

limiting the rights, powers and duties of such trustee;

(j) any other matters, of like or different character, which in any

way affect the security or protection of the notes or bonds.

4. It is the intention hereof that any pledge made by the fund shall

be valid and binding from the time when the pledge is made; that the

monies or property so pledged and thereafter received by the fund shall

immediately be subject to the lien of such pledge without any physical

delivery thereof or further act; and that the lien of any such pledge

shall be valid and binding as against all parties having claims of any

kind in tort, contract or otherwise against the fund, irrespective of

whether such parties have notice thereof. Neither the resolution nor any

other instrument by which a pledge is created need be recorded.

5. Neither the trustees of the fund nor any person executing the notes

or bonds shall be liable personally on the notes or bonds or be subject

to any personal liability or accountability by reason of the issuance

thereof.

6. The fund, subject to such agreements with noteholders or

bondholders as may then exist, shall have power out of any funds

available therefor to purchase notes or bonds of the fund, which shall

thereupon be cancelled, at a price not exceeding (a) if the notes or

bonds are then redeemable, the redemption price then applicable plus

accrued interest to the next interest payment date thereon, or (b) if

the notes or bonds are not then redeemable, the redemption price

applicable on the first date after such purchase upon which the notes or

bonds become subject to redemption plus accrued interest to such date.

7. Neither the state nor the city of Yonkers shall be liable on the

notes or bonds of the fund and such notes and bonds shall not be a debt

of the city or the state, and such notes and bonds shall contain on the

face thereof a statement to such effect.