§ 575. Bond required. 1. At the time of filing each registration\nstatement, the trading stamp company must also file with the secretary\nof state a bond payable to the people of the state of New York and duly\nexecuted by the company and a corporate surety qualified to do business\nin this state; such bond shall be conditioned upon the performance by\nthe trading stamp company of its obligation to redeem trading stamps\nissued by retailers in this state when they are duly presented for\nredemption by the rightful holders.\n 2. The principal sum of the bond required by this article shall be as\nfollows: if the company has not previously done business as a trading\nstamp company in this state, or if the company's gross receipts from\nsuch business during its last fiscal year was not in excess of one\nhundred thousand dollars the principal sum shall be ten thousand\ndollars; for each additional one hundred thousand dollars, or fraction\nthereof, of gross receipts from such business in this state, an\nadditional ten thousand dollars, but such bond shall not exceed one\nhundred fifty thousand dollars.\n 3. On the effective date of each new bond, any and all liability on\nall bonds previously filed under this article shall terminate, and all\nrightful holders of trading stamps who prosecute their claims under this\narticle shall prosecute such claims solely against the new bond and only\nby filing proofs of claim with the secretary of state in the manner\nprovided in this article.\n 4. In lieu of the bond required by this section, the trading stamp\ncompany may post with the secretary of state (a) money equal to the\namount of the bond otherwise required or (b) securities equal to one\nhundred twenty percent of the bond otherwise required. Such securities\nshall be of the same kinds and classes as those in which the comptroller\nmay invest the funds of the state pursuant to section ninety-eight of\nthe state finance law, or in which a fiduciary may invest funds he holds\nfor investment pursuant to subparagraphs A through I of subparagraph (1)\nof paragraph (a) of section 11-2.2 of the Estates, Powers and Trusts\nLaw.\n
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