N.Y. Real Prop. Law § 120-A
Any banking corporation or individual acting as trustee in respect to any mortgage upon real property against which bonds shall have been issued to the public and which mortgage shall have been given to such trustee by a corporation organized under the provisions of section one hundred twenty-one hereof, pursuant to a plan of reorganization approved by the court and which became effective under section one hundred twenty-two hereof, or which mortgage shall have been given pursuant to a plan of reorganization heretofore or hereafter approved and confirmed under the bankruptcy acts of the United States, or which mortgage shall have been given to such trustee under a voluntary plan of reorganization by a corporation caused to be organized by a bondholders' committee for the purpose of acquiring the property secured by such mortgage at a sale under a judgment of foreclosure and sale of a prior mortgage given to secure bonds theretofore issued to the public, may, with the approval of the supreme court in the county where all or part of the property affected by such mortgage is situate, sell, assign, discharge or satisfy such mortgage upon such consideration in cash as the court shall deem fair and equitable to the bondholders and as the court by order shall direct. Such order may be made upon the application of the trustee or the holder of twenty-five per cent of the bonds or of the mortgagor or owners of the property securing such mortgage. The court may approve a sale, assignment, discharge or satisfaction at such price as may appear to the court to be fair and in the best interests of the bondholders and not less than the cash value of said mortgage if sold at a public sale, unless duly acknowledged dissents thereto by holders of more than one-third of the principal amount of the bonds then outstanding have been filed. If the application for such sale shall be consented to by the holders of two-thirds of the principal amount of the bonds outstanding such consent shall constitute a presumption that it is fair and in the best interests of the bondholders that said mortgage be liquidated at the price fixed in such consent and the court may approve a sale at such amount unless it shall appear to the court that such amount is less than the cash value of said mortgage if sold at a public sale. If the application shall not be made by the trustee then notice shall be given to the trustee and in any event the order directing notice to the bondholders of the application to liquidate such mortgage shall provide for personal service of such notice not less than thirty days before the return date thereof upon not less than ten specified bondholders whose addresses are known to the applicant and notice by mail to all of the bondholders whose addresses are known and the publication of such notice once a week on a week day for three successive weeks preceding the return date thereof in one newspaper of general circulation published in the city or county where the real property securing said mortgage is located. Except as herein otherwise provided all proceedings hereunder and the rights of the parties hereto, shall be governed by section one hundred twenty-two hereof ; except that if the order shall become effective it shall be without prejudice to the right of any particular bondholder who has filed a duly acknowledged dissent therefrom, within the time fixed in the order, to have the court determine the cash value of the mortgage securing such bond if sold at a public sale and providing for the payment or securing his ratable share of such amount as a condition for declaring the order effective.
If any provision of this section or of section one hundred twenty-two hereof or any clause, sentence, paragraph or any part of such section or the application thereof to any person or circumstance shall be held unconstitutional or invalid, such decision or judgment shall not affect or impair the constitutionality or validity of the remainder thereof, but shall be confined in its operation to the clause, sentence, paragraph or part thereof directly involved in such decision or judgment.
N.Y. Real Prop. Law § 120-A