N.Y. Public Authorities Law § 561: Bonds of the authority

§ 561. Bonds of the authority. 1. The authority shall have the power

and is hereby authorized from time to time to issue its negotiable bonds

in conformity with applicable provisions of the uniform commercial code

for any corporate purpose or power. The authority shall have power from

time to time and whenever it deems refunding advantageous or desirable,

to refund, redeem or otherwise pay, including by purchase or tender any

bonds by the issuance of new bonds, whether the bonds to be refunded

have or have not matured, and may issue bonds partly to refund bonds

then outstanding and partly for any other corporate purpose or power.

The refunding bonds may be exchanged for the bonds to be refunded, with

such cash adjustments as may be agreed, or may be sold and the proceeds

applied to the purchase or payment of the bonds to be refunded. The

authority may issue general or special obligation bonds. Every issue of

general obligation bonds shall be payable out of any moneys or revenues

of the authority, subject only to any agreements with the holders of

particular bonds pledging any particular tolls or revenues. Every issue

of special obligation bonds shall be payable out of any revenues,

receipts, monies or assets of the authority, the metropolitan

transportation authority and its subsidiary corporations and the New

York city transit authority and its subsidiary corporations identified

for such purposes in accordance with agreements with the holders of

particular bonds.

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

bear such date or dates, mature at such time or times, not exceeding

fifty years from their respective dates, bear interest at such rate or

rates, be payable at such time or times, 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 bonds may

be sold at public or private sale for such price or prices as the

authority shall determine. Notwithstanding the foregoing provisions,

such bonds as may be authorized by resolution of the board and issued on

or before June thirtieth, nineteen hundred sixty-five, shall bear

interest at such rate or rates as such resolution may provide.

3. The bonds may be issued for any corporate purpose of the authority.

4. Any resolution or resolutions authorizing any bonds or any issue of

bonds may contain provisions, which shall be a part of the contract with

the holders of the bonds thereby authorized, as to

(a) pledging all or any part of the tolls and revenues of the project

or of all or any part of any or all such projects to secure the payment

of the bonds or of any issue of the bonds subject to such agreements

with bondholders as may then exist;

(b) the rates of the tolls to be charged, and the amounts to be raised

in each year by tolls, and the use and disposition of the tolls and

other revenues;

(c) the setting aside of reserves or sinking funds, and the regulation

and disposition thereof;

(d) limitations on the right of the authority to restrict and regulate

the use of the project in connection with which such bonds are issued;

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

issue of bonds then or thereafter to be issued may be applied and

pledging such proceeds to secure the payment of the bonds or of any

issue of the bonds;

(f) limitations on the issuance of additional bonds; the terms upon

which additional bonds may be issued and secured; the refunding of

outstanding or other bonds;

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

bondholders may be amended or abrogated, the amount of bonds the holders

of which must consent thereto, and the manner in which such consent may

be given;

(h) limitations on the amount of moneys derived from any project to be

expended for operating, administrative or other expenses of the

authority;

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

duties in trust as the authority may determine which may include any or

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

bondholders pursuant to section five hundred sixty-seven hereof, and

limiting or abrogating the right of the bondholders to appoint a trustee

under section five hundred sixty-seven hereof or limiting the rights,

duties and powers of such trustee;

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

way affect the security or protection of the bonds.

4-a. Any resolution or resolutions authorizing any bonds or any issue

of bonds maturing in not exceeding ten years from their date (hereafter

in this subdivision four-a referred to as "short term obligations") may

contain, in addition to all other provisions authorized by this title,

provisions, which shall be a part of the contract with the holders of

the short term obligations thereby authorized, as to (a) refunding the

short term obligations and, if so provided, outstanding bonds by the

issuance of bonds of the authority either by the sale of bonds and the

application of the proceeds to the payment of the short term obligations

and outstanding bonds or by the exchange of bonds for the short term

obligations and outstanding bonds; provided, however, that the authority

shall make no covenant to refund which shall require it to issue bonds,

the aggregate principal amount of which shall exceed by more than ten

per centum the aggregate principal amount of the short term obligations

and outstanding bonds to be refunded thereby;

(b) satisfying, paying or discharging the short term obligations, at

the election of the authority, by the tender or delivery of bonds of the

authority in exchange therefor; provided, however, that the aggregate

principal amount of bonds shall not exceed by more than ten per centum

the aggregate principal amount of the short term obligations to satisfy,

pay or discharge which the bonds are tendered or delivered;

(c) exchanging or converting the short term obligations, at the

election of the holder thereof, for or into bonds of the authority;

provided, however, that the aggregate principal amount of the bonds

shall not exceed by more than ten per centum the aggregate principal

amount of the short term obligations to be exchanged for or converted

into bonds;

(d) pledging bonds of the authority as collateral to secure payment of

the short term obligations and providing for the terms and conditions of

the pledge and manner of enforcing the pledge, which terms and

conditions may provide for the delivery of the bonds in satisfaction of

the short term obligations; provided, however, that the aggregate

principal amount of the bonds pledged shall not exceed by more than ten

per centum the aggregate principal amount of the short term obligations

to secure which they are pledged;

(e) depositing bonds in escrow or in trust with a trustee or fiscal

agent or otherwise providing for the issuance and disposition of the

bonds as security for carrying out any provisions in any resolution

adopted pursuant to the foregoing paragraphs (a), (b), (c) and (d)

hereof and providing for the powers and duties of the trustee or fiscal

agent or other depositary and the terms and conditions on which the

bonds are to be issued, held and disposed of;

(f) any other matters of like or different character which relate to

any provision or provisions of any resolution adopted pursuant to the

foregoing paragraphs (a), (b), (c), (d) and (e) hereof.

In computing the amount of bonds of the authority which may be

outstanding at any one time, short term obligations shall be excluded to

the extent that the resolution authorizing the issuance of such short

term obligations shall provide for the issuance of bonds pursuant to

paragraphs (a), (b), (c) or (d) of this section, but the bonds provided

to be issued by such resolution shall be included in making such

computation whether or not such bonds are outstanding.

The authority shall have power to make contracts for the future sale

from time to time of short term obligations, by which the purchasers

shall be committed to purchase short term obligations from time to time

on the terms and conditions stated in such contracts, and the authority

shall have power to pay such consideration as it shall deem proper for

such commitments.

4-b. The authority shall have power from time to time to issue notes

(herein referred to as notes) for any corporate purpose or power and

from time to time to issue renewal notes maturing not later than five

years, from their respective dates whenever the authority shall

determine that payment thereof can be made in full from any moneys or

revenues which the authority expects to receive from any source. The

authority may pledge such moneys or revenues (subject to any other

pledge thereof) for the payment of the notes and may in addition secure

the notes in the same manner as herein provided for bonds or otherwise.

The notes shall be issued in the same manner as bonds. The authority

shall have power to make contracts for the future sale from time to time

of the notes, by which the purchasers shall be committed to purchase the

notes from time to time on terms and conditions stated in such

contracts, and the authority shall have power to pay such consideration

as it shall deem proper for such commitments.

4-c. It is the intention hereof that any pledge of tolls or other

revenues or other moneys made by the authority shall be valid and

binding from the time when the pledge is made; that the tolls or other

revenues or other moneys so pledged and thereafter received by the

authority 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

authority 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 members of the board nor any person executing the bonds

shall be liable personally on the bonds or be subject to any personal

liability or accountability by reason of the issuance thereof.

6. The authority shall have power out of any funds available therefor

to purchase bonds. The authority may hold, cancel or resell such bonds,

subject to and in accordance with agreements with bondholders.