2023 New York Laws › PBA - Public Authorities › Article 8 - Miscellaneous Authorities › Title 18 - State of New York Municipal Bond Bank Agency Act › 2440 - Remedies of Bondholders and Noteholders.

§ 2440. Remedies of bondholders and noteholders. (1) In the event that
the  agency  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
maturity  or  upon  call for redemption, and such default shall continue
for a period of thirty days, or in the event that the agency 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
instruments  filed in the office of the clerk of the county in which the
principal office of the agency 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  agency  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 agency to carry out any other agreements with the  holders  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 agency 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
governor, to the agency and to the attorney general of the state.
(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 in which the principal office of the agency is located.
(6) The remedies granted by this section shall not apply to  tax  lien
collateralized securities. The remedies available to the holders of such
securities shall be expressly limited to those set forth in the contract
with the owners of such securities.