Pennsylvania Statutes Title 53 P.S. Municipal and Quasi-Municipal Corporations § 16999.18. Remedies of bondholders

(a) If the city fails or neglects to pay or cause to be paid the principal of or the interest on any bond as the same shall become due, whether at the stated maturity or upon call for prior redemption, the holder thereof shall, subject to subsection (b) of this section, and to any reasonable limitations upon individual rights of action properly provided in the ordinance or bond resolution, have the right to recover the amount due in an action in a court of competent jurisdiction, but the judgment shall be limited to payment out of the revenues of the municipal utility for whose benefit the bonds were issued.

(b) Notwithstanding any provision in the bonds, the ordinance, or in the bond resolution, if the city shall default in the payment of the principal of or the interest on any series of bonds after the same shall become due, whether at the stated maturity or upon call for prior redemption, and such default shall continue for 30 days, or if the city shall fail to comply with any provision of the bonds, the ordinance or in any bond resolution, the holders of 25% in aggregate principal amount of the bonds of such series then outstanding, by an instrument or instruments filed in the department of records in the city signed and acknowledged in the same manner as a deed to be recorded, may appoint a trustee, who may be the sinking fund depository, to represent the holders of all such bonds and such representation shall be exclusive for the purposes herein provided. Such trustee may, and upon written request of the holders of 25% in principal amount of such bonds then outstanding and upon being furnished with indemnity satisfactory to it, shall, in its own name, take one or more of the actions set forth below and the taking of such actions shall preclude similar action whether previously or subsequently initiated by individual holders of bonds:

(c) The court in cases of extreme hardship may provide for the payment of sums levied in five or less annual installments with interest at a rate sufficient to cover the interest accruing on the bonds.