N.Y. NYS Project Finance Agency Act7/75 § 13: Remedies of noteholders and bondholders

§ 13. Remedies of noteholders and bondholders.

1. In the event that the agency shall default in the payment of

principal of or interest on any issue of notes or bonds after the same

shall become due, whether at maturity or upon call for redemption, and

such default shall continue for a period of thirty days, or in the event

that the agency shall fail or refuse to comply with the provisions of

this act, or shall default in any agreements made with the holders of

any issue of notes or bonds, the holders of twenty-five per centum in

aggregate principal amount of the notes or bonds of such issue then

outstanding, by instrument or instruments filed in the office of the

clerk of the county of Albany and proved or acknowledged in the same

manner as a deed to be recorded, may appoint a trustee to represent the

holders of such notes or bonds for the purposes herein provided.

2. Such trustee may, and upon written request of the holders of

twenty-five per centum in principal amount of such notes or bonds then

outstanding shall, in his or its own name:

(a) by suit, action or proceeding in accordance with the civil

practice law and rules, enforce all rights of the noteholders or

bondholders, including the right to require the agency to collect fees

and charges and interest and amortization payments on mortgages

purchased and eligible loans made by it adequate to carry out any

agreement as to, or pledge of, such fees and charges and interest and

amortization payments on such mortgages and loans and other properties

and to require the agency to carry out any other agreements with the

holders of such notes or bonds and to perform its duties under this act;

(b) bring suit upon such notes or bonds;

(c) by action or suit, require the agency to account as if it were the

trustee of an express trust for the holders of such notes or bonds;

(d) by action or suit, enjoin any acts or things which may be unlawful

or in violation of the rights of the holders of such notes or bonds;

(e) declare all such notes or bonds due and payable and if all

defaults shall be made good, then, with the consent of the holders of

twenty-five per centum of the principal amount of such notes or bonds

then outstanding, to annul such declaration and its consequences.

3. Such trustee shall in addition to the foregoing have and possess

all of the powers necessary or appropriate for the exercise of any

functions specifically set forth herein or incident to the general

representation of bondholders or noteholders in the enforcement and

protection of their rights.

4. The supreme court shall have jurisdiction of any suit, action or

proceeding by the trustee on behalf of such noteholders or bondholders.

The venue of any such suit, action or proceeding shall be laid in the

county of Albany.

5. Before declaring due and payable the principal of notes or bonds

issued in connection with any mortgage purchased by the agency or

securing an eligible loan made by the agency, the trustee shall first

give thirty days' notice in writing to the governor, to the agency, to

the commissioner and to the attorney general of the state.