New York Laws
Article 2 - Limited-Profit Housing Companies
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.

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