N.Y. Public Authorities Law § 1040: Remedies of bondholders

* § 1040. Remedies of bondholders. 1. If, and to the extent, and in

the events, provided in the resolution authorizing the bonds, the

holders of not less than twenty-five per centum in the aggregate

principal amount of bonds at any time outstanding, may 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,

appoint a trustee to represent all the bondholders for the purposes

hereafter provided, which trustee or successor trustee may, however, be

removed or a new trustee appointed at any time by the holders of not

less than fifty-one per centum of such bonds by similar instrument or

instruments so filed, and so proved or acknowledged. Subject to such

authorizing resolution, such trustee may, and upon written request of

the holders of not less than twenty-five per centum in principal amount

of the bonds then outstanding shall, in his or its name:

(a) by suit, action or special proceeding enforce all rights of the

bondholders, including the right to require the authority and the

members or officers thereof to collect rates and other revenue adequate

to carry out any agreements as to, or pledge of, such rates and revenue,

and to require the authority and members or officers thereof to carry

out any other agreements with the bondholders and to perform its and

their duties under this title;

(b) bring suit upon the bonds;

(c) by action or suit in equity, require the authority to account as

if it were the trustee of an express trust for the bondholders;

(d) by action or suit in equity, enjoin any acts or things which may

be unlawful or in violation of the rights of the bondholders;

(e) after thirty days' notice in writing to the authority and if, and

in the events, specified in the resolution, declare all bonds due and

payable, and thereafter if, and in the events, specified in the

resolution, annul such declaration and its consequences.

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

proceeding by the trustee on behalf of the bondholders and the venue

thereof shall be laid in Albany county.

3. Subject to the authorizing resolution, any such trustee, whether or

not all bonds have been declared due and payable, shall be entitled as

of right to the appointment of a receiver who may enter and take

possession of the properties of the authority or any part or parts

thereof and operate and maintain the same and collect and receive all

rates, charges and other revenues thereafter arising therefrom and

exercise such other powers of the authority as the court may deem

advisable in the same manner as the authority itself might do and shall

deposit all such moneys in a separate account and apply the same in such

manner as the court shall direct. In any suit, action or proceeding by

the trustee the fees, counsel fees and expenses of the trustee and of

the receiver, if any, shall constitute taxable disbursements and all

costs and disbursements allowed by the court shall be a first charge on

any rates, charges and other revenues derived from such properties.

* NB Terminated July 1, 1963