704 - Classification of directors. - New York Statutes

§ 704. Classification of directors. (a) The certificate of incorporation or a by-law adopted by the members may provide that directors elected or appointed at large shall be divided into either two, three, four or five classes for the purpose of staggering their terms of office and that all or some of the directors elected or appointed otherwise than at large shall be divided into the same or a different number of classes, not exceeding five, for the same purpose. All classes of each type shall be as nearly equal in number as possible and, if provision has been made for cumulative voting under section 617 (Cumulative voting), no class shall include less than three directors. (b) The terms of office of the directors initially classified shall be as follows: that of the first class shall expire at the next annual meeting of members if there be members, or of the board if there be no members, the second class at the second succeeding annual meeting, the third class, if any, at the third succeeding annual meeting, the fourth class, if any, at the fourth succeeding annual meeting and the fifth class, if any, at the fifth succeeding annual meeting. After such initial classification, directors to replace those whose terms expire at each annual meeting shall be elected or appointed at such meeting to hold office for a full term in accordance with such classification. (c) If directors are classified and the number of directors is thereafter changed by action of the board: (1) Any newly created directorships or any decrease in directorships shall be so apportioned among the classes as to make all classes as nearly equal in number as possible. (2) If newly created directorships are filled by the board in a corporation having members, there shall be no classification of the additional directors until the next annual meeting of members.