The troubled Sports Museum of America in lower Manhattan is seeking bondholder approval to allow $57 million of debt initially sold to finance its development to be purchased at less than 19 cents on the dollar to stave off the museum's closure.

In 2006, the New York Liberty Development Corp. issued $52 million of tax-exempt Liberty bonds and $5 million of federally taxable bonds on behalf of the for-profit borrower, National Sports Museum Management LLC, for the project, then called the National Sports Museum.

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