N.Y. PBA Law § 3035

* § 3035. Exchange of notes or bonds of the corporation for short-term\nobligations of the city. 1. The corporation may issue its notes or bonds\nin exchange for short-term obligations of the city, provided that the\nprincipal amount of the corporation's notes or bonds issued in any such\nexchange shall not exceed the principal amount of such short-term\nobligations and accrued interest thereon at the stated rate to the date\nof such exchange.\n 2. (a) Upon or at any time after receipt of the short-term obligations\nof the city exchanged in accordance with subdivision one hereof, the\ncorporation may deliver any or all of such short-term obligations to the\ncity for cancellation, without receiving payment of principal or\ninterest in respect thereof, in which event the city shall thereupon\ncancel such obligations without making any payment of principal amount\nor accrued interest thereon and the city shall have no further liability\nwith respect thereto. Notwithstanding the foregoing, the corporation\nshall not deliver at any time bond anticipation notes received pursuant\nto subdivision one to the city for cancellation without receiving\npayment of principal or interest in respect thereof unless the mayor and\nthe city comptroller shall have requested in writing that such\nshort-term obligations be delivered for cancellation.\n (b) Upon or at any time after receipt of the short-term obligations of\nthe city exchanged in accordance with subdivision one hereof the\ncorporation may exchange any or all of such short-term obligations for\nother short-term obligations issued by the city pursuant to the local\nfinance law and the corporation may exchange any or all of such bond\nanticipation notes included in such short-term obligations for bonds of\nthe city issued pursuant to the local finance law, all on such terms and\nconditions as the corporation may deem proper.\n 3. The corporation shall not exchange any of its bonds or notes for\nshort-term obligations of the city pursuant to subdivision one hereof\nunless (a) the city shall have agreed to observe the conditions set\nforth in section three thousand thirty-eight of this chapter, subject to\nsuch modifications as are permitted thereunder and as the corporation\nmay then approve, and (b) the board of directors of the corporation\nshall have determined that the terms of such exchange will not prejudice\nthe rights of holders of other bonds and notes of the city.\n * NB The corporation shall continue for a term ending the later of\nJuly 1, 2008 or one year after its liabilities have been fully paid and\ndischarged per § 3033 sub 1.\n