N.Y. Private Housing Finance Law § 660: Remedies of noteholders and bondholders

§ 660. Remedies of noteholders and bondholders. 1. In the event that

the corporation 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 corporation shall

fail or refuse to comply with the provisions of this article, or shall

default in any agreement 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 New York 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 such trustee's 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 corporation to carry out

any agreement with such holders and to perform its duties under this

article;

(b) bring suit upon such notes or bonds;

(c) by action or suit, require the corporation 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, annul such declaration and its consequences.

3. 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 New York.

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

the trustee shall first give thirty days' notice in writing to the

corporation.