2023 New York Laws › PBA - Public Authorities › Article 8 - Miscellaneous Authorities › Title 4 - Dormitory Authority › 1686 - Remedies of Bondholders.

§  1686.  Remedies  of bondholders. 1. In the event that the authority
shall default in the payment of principal of or interest on any  of  the
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 authority shall fail or refuse to comply
with the provisions of this title, or shall  default  in  any  agreement
made  with  the  holders  of  the  bonds, the holders of twenty-five per
centum in aggregate principal amount of the bonds  then  outstanding  by
instrument or instruments filed in the office of the clerk of the county
in which the dormitory is located and proved or acknowledged in the same
manner  as  a deed to be recorded may appoint a trustee to represent the
bondholders for the purposes herein provided;
2. Such trustee may, and  upon  written  request  of  the  holders  of
twenty-five  per  centum  of  the  principal  amount  of  the bonds then
outstanding upon any dormitory shall, in his or its own name
(a) by suit, action or special proceeding enforce all  rights  of  the
bondholders,  including the right to require the authority and the board
to collect rental and other revenues of any dormitory adequate to  carry
out  any  agreement as to, or pledge of, such rental and other revenues,
and to require the authority and  the  board  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) declare all bonds due and payable upon any dormitory, and  if  all
defaults  shall  be  made  good,  annul, upon the written consent of the
holders of twenty-five per centum in principal amount of the bonds  then
outstanding, such declaration and its consequences.
3.  The  supreme  court shall have jurisdiction of any suit, action or
proceeding by the trustee on behalf of the bondholders. The venue of any
such suit, action or proceeding shall be laid in the county in which the
dormitory is located.
4. Before declaring the principal of all bonds  due  and  payable  the
trustee  shall  first  give  thirty  days'  notice  in  writing  to  the
authority.
5. 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 dormitory or any  part
or  parts  thereof  and  operate  and  maintain the same and collect and
receive all rentals and other revenues thereafter arising  therefrom  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
rentals and other revenues derived from the dormitory.
6. Such trustees 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  the bondholders in the enforcement and protection of
their rights.