§ 501. Authorized shares.\n (a) Every corporation shall have power to create and issue the number\nof shares stated in its certificate of incorporation. Such shares may be\nall of one class or may be divided into two or more classes. Each class\nshall consist of either shares with par value or shares without par\nvalue, having such designation and such relative voting, dividend,\nliquidation and other rights, preferences and limitations, consistent\nwith this chapter, as shall be stated in the certificate of\nincorporation. The certificate of incorporation may deny, limit or\notherwise define the voting rights and may limit or otherwise define the\ndividend or liquidation rights of shares of any class, but no such\ndenial, limitation or definition of voting rights shall be effective\nunless at the time one or more classes of outstanding shares or bonds,\nsingly or in the aggregate, are entitled to full voting rights, and no\nsuch limitation or definition of dividend or liquidation rights shall be\neffective unless at the time one or more classes of outstanding shares,\nsingly or in the aggregate, are entitled to unlimited dividend and\nliquidation rights.\n (b) If the shares are divided into two or more classes, the shares of\neach class shall be designated to distinguish them from the shares of\nall other classes. Shares which are entitled to preference in the\ndistribution of dividends or assets shall not be designated as common\nshares. Shares which are not entitled to preference in the distribution\nof dividends or assets shall be common shares, even if identified by a\nclass or other designation, and shall not be designated as preferred\nshares.\n (c) Subject to the designations, relative rights, preferences and\nlimitations applicable to separate series and except as otherwise\npermitted by subparagraph two of paragraph (a) of section five hundred\nfive of this article, each share shall be equal to every other share of\nthe same class. With respect to corporations owning or leasing\nresidential premises and operating the same on a cooperative basis,\nhowever, provided that (1) liquidation or other distribution rights are\nsubstantially equal per share, (2) changes in maintenance charges and\ngeneral assessments pursuant to a proprietary lease have been and are\nhereafter fixed and determined on an equal per-share basis or on an\nequal per-room basis or as an equal percentage of the maintenance\ncharges, and (3) voting rights are substantially equal per share or the\ncertificate of incorporation provides that the shareholders holding the\nshares allocated to each apartment or dwelling unit owned by the\ncorporation shall be entitled to one vote in the aggregate regardless of\nthe number of shares allocated to the apartment or dwelling unit or the\nnumber of shareholders holding such shares, shares of the same class\nshall not be considered unequal because of variations in fees or charges\npayable to the corporation upon sale or transfer of shares and\nappurtenant proprietary leases that are provided for in proprietary\nleases, occupancy agreements or offering plans or properly approved\namendments to the foregoing instruments.\n
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