N.Y. Private Housing Finance Law § 28: Payments from earnings

§ 28. Payments from earnings. 1. There shall be paid annually out of

the earnings of the company, after providing for all taxes, assessments

and expenses, a sum for interest on and amortization of the mortgage

indebtedness of all mortgages of the company, depreciation charges and

reserves if, when and to the extent deemed necessary by the commissioner

or the supervising agency, as the case may be, plus a dividend of six

per centum on outstanding stock and interest not exceeding six per

centum on the outstanding income debentures of the company; the

obligation in respect of such payments shall be cumulative, and any

deficiency in interest, amortization, depreciation, reserves, if any,

and dividends in any year shall be paid either from any cash surplus

derived from earnings remaining in the treasury of the company in excess

of the amount necessary to provide such cumulative annual sums or from

the first available earnings in subsequent years. If, at the end of any

three year period, the gross receipts should exceed the payments or

charges necessary for the purposes of the project or projects and are

not needed for a sinking fund, reserves or other purposes, the balance

may be paid in further reduction of any indebtedness to the extent and

upon terms and conditions approved by the commissioner and the state

comptroller or by the supervising agency, as the case may be. A sinking

fund may be authorized by the commissioner or the supervising agency, to

purchase and retire bonds, income debentures or stock of the company at

a price approved by the commissioner or the supervising agency, as the

case may be, not exceeding par value thereof with accrued or unpaid

dividends or interest or if it be not practical to purchase such stock

or income debentures at a price so approved, the money in such sinking

fund may be added to the surplus of such company. Any stock or income

debentures purchased out of such sinking fund shall be cancelled and

shall not be reissued.

2. Anything contained in this article to the contrary notwithstanding,

a company which receives a loan from the state, the New York state

housing finance agency or a municipality after July first, nineteen

hundred sixty-nine, or a mutual company which has been duly authorized

to issue income debentures to finance the modernization or replacement

of project improvements or the acquisition and installation of energy

saving equipment and which is otherwise authorized to pay dividends upon

its shares or interest upon its income debentures, may, with the

approval of the commissioner or the supervising agency as the case may

be, pay such dividends or interest in excess of six per centum per

annum, but in no event shall any such rate exceed the interest rate

prescribed by the superintendent of financial services pursuant to

section fourteen-a of the banking law, provided, however, if the voting

stock of a mutual company has not been issued and delivered to the stock

subscribers, then the additional authorization of such stock subscribers

is required to be obtained by a majority vote.

3. No director or officer of a company shall receive, directly or

indirectly, any salary, compensation or emolument from such company, as

such director or officer or in any other capacity, unless authorized by

the commissioner or the supervising agency, as the case may be.