§ 573. Incorporation and organization of non-profit housing
corporations. 1. A housing development fund company shall be
incorporated pursuant to the provisions of this article and the
provisions of either (a) the business corporations law, (b) the
not-for-profit corporation law, or (c) the not-for-profit corporation
law and article two of this chapter.

2. The term "housing development fund corporation" or "housing
development fund company" shall be included as a part of the corporate
name as set forth in the certificate of incorporation.

3. The certificate of incorporation of any such corporation shall, in
addition to any other requirements of law, provide:

a. that the company has been organized exclusively to develop a
housing project for persons of low income;

b. that all income and earnings of the corporation shall be used
exclusively for corporate purposes, and that no part of the net income
or net earnings of the corporation shall inure to the benefit or profit
of any private individual, firm, corporation or association;

c. that if the corporation receives a temporary loan or advance from
the housing development fund or a municipal housing development fund, as
established by or pursuant to article eleven of the private housing
finance law, it shall be authorized to enter into an agreement with the
commissioner of housing and community renewal of the state of New York
or the supervising agency, as the case may be, providing for regulation
with respect to rents, profits, dividends and disposition of property or
franchises;

d. that if the corporation receives a temporary loan or advance from
the housing development fund or a municipal housing development fund, as
established by or pursuant to article eleven of the private housing
finance law, the commissioner of housing and community renewal of the
state of New York or the supervising agency, as the case may be, shall
have the power, if, in his or its discretion, he or it determines either
that any such temporary loan or advance is in jeopardy of not being
repaid, or that the proposed housing project for which such temporary
loan or advance was made is in jeopardy of not being constructed, to
appoint to the board of directors of such corporation a number of new
directors, which number shall be sufficient to constitute a majority of
such board, notwithstanding any other provision of such certificate of
incorporation or of any other provision of law.

4. The certificate of incorporation of any such corporation organized
pursuant to the business corporation law and this article shall, in
addition, provide that each housing project of such corporation shall be
operated exclusively for the benefit of the persons or families who are
entitled to occupancy in such housing project by reason of ownership of
shares in such corporation, and that such corporation may issue shares
for home owners purchase notes if the purchase transaction has received
the written endorsement of the commissioner in accordance with
supplementary rules and regulations of the commissioner made therefor
and if at least two hundred dollars in money or property is received by
such corporation toward the issuance of such shares.

5. The secretary of state shall not file the certificate of
incorporation of any such corporation or any amendment thereto unless
the consent or approval of the commissioner or the supervising agency,
as the case may be, is affixed thereon or attached thereto. Consent to
the filing of such certificate of incorporation shall be based upon
findings by the commissioner or supervising agency as to the character
and competence of the sponsor.