N.Y. Public Authorities Law § 2513: Remedies of bondholders and noteholders

* § 2513. Remedies of bondholders and noteholders. 1. In the event

that the authority shall default in the payment of principal or of

interest on any issue of bonds or notes after the same shall become due,

whether at maturty or upon call for redemption, and such default shall

continue for a period of thirty days, or in the event that the authority

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

shall default in any agreement made with the holders of any issue of

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

principal amount of the bonds or notes of such issue then outstanding,

by instrument or instuments filed in the office of the clerk of the

county in which the principal office of the authority is located, and

proved or acknowledged in the same manner as a deed to be recorded, may

appoint a trustee to represent the holders of such bonds or notes 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 bonds or notes then

outstanding shall, in his or its own name:

(a) enforce all rights of the bondholders or noteholders, including

the right to require the authority to collect interest and principal

payments on the bonds held by it adequate to carry out any agreement as

to, or pledge of, such interest and principal payments, and to require

the authority to carry out any other agreements with the holder of such

bonds or notes and to perform its duties under this title.

(b) bring suit upon such bonds or notes.

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

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

(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 bonds or notes.

(e) declare all such bonds or notes 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 bonds or notes

then outstanding, to annul such declaration and its consequences.

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

all the powers necessary or appropriate for the exercise of any

functions specifically set forth herein or incident to the general

representation of bondholders in the enforcement and protection of their

rights.

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

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

mayor, to the authority and to the comptroller.

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

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

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

county of New York.

* NB (Discontinued-Board of Directors never appointed)