§ 502 — Issue of any class of preferred shares in series

§ 502. Issue of any class of preferred shares in series.\n (a) If the certificate of incorporation so provides, a corporation may\nissue any class of preferred shares in series. Shares of each such\nseries when issued, shall be designated to distinguish them from shares\nof all other series.\n (b) The number of shares included in any or all series of any classes\nof preferred shares and any or all of the designations, relative rights,\npreferences and limitations of any or all such series may be fixed in\nthe certificate of incorporation, subject to the limitation that, unless\nthe certificate of incorporation provides otherwise, if the stated\ndividends and amounts payable on liquidation are not paid in full, the\nshares of all series of the same class shall share ratably in the\npayment of dividends including accumulations, if any, in accordance with\nthe sums which would be payable on such shares if all dividends were\ndeclared and paid in full, and in any distribution of assets other than\nby way of dividends in accordance with the sums which would be payable\non such distribution if all sums payable were discharged in full.\n (c) If any such number of shares or any such designation, relative\nright, preference or limitation of the shares of any series is not fixed\nin the certificate of incorporation, it may be fixed by the board, to\nthe extent authorized by the certificate of incorporation. Unless\notherwise provided in the certificate of incorporation, the number of\npreferred shares of any series so fixed by the board may be increased\n(but not above the total number of authorized shares of the class) or\ndecreased (but not below the number of shares thereof then outstanding)\nby the board. In case the number of such shares shall be decreased, the\nnumber of shares by which the series is decreased shall, unless\neliminated pursuant to paragraph (e) of this section, resume the status\nwhich they had prior to being designated as part of a series of\npreferred shares.\n (d) Before the issue of any shares of a series established by the\nboard, a certificate of amendment under section 805 (Certificate of\namendment; contents) shall be delivered to the department of state.\nSuch certificate shall set forth:\n (1) The name of the corporation, and, if it has been changed, the name\nunder which it was formed.\n (2) The date the certificate of incorporation was filed by the\ndepartment of state.\n (3) That the certificate of incorporation is thereby amended by the\naddition of a provision stating the number, designation, relative\nrights, preferences, and limitations of the shares of the series as\nfixed by the board, setting forth in full the text of such provision.\n (e) Action by the board to increase or decrease the number of\npreferred shares of any series pursuant to paragraph (c) of this section\nshall become effective by delivering to the department of state a\ncertificate of amendment under section 805 (Certificate of amendment;\ncontents) which shall set forth:\n (1) The name of the corporation, and, if it has been changed, the name\nunder which it was formed.\n (2) The date its certificate of incorporation was filed with the\ndepartment of state.\n (3) That the certificate of incorporation is thereby amended to\nincrease or decrease, as the case may be, the number of preferred shares\nof any series so fixed by the board, setting forth the specific terms of\nthe amendment and the number of shares so authorized following the\neffectiveness of the amendment.\n When no shares of any such series are outstanding, either because none\nwere issued or because no issued shares of any such series remain\noutstanding, the certificate of amendment under section 805 may also set\nforth a statement that none of the authorized shares of such series are\noutstanding and that none will be issued subject to the certificate of\nincorporation, and, when such certificate becomes accepted for filing,\nit shall have the effect of eliminating from the certificate of\nincorporation all matters set forth therein with respect to such series\nof preferred shares.\n