Section 506. Bonds and security interests

(a)  No  corporation  shall  issue  bonds  except  for  money or other
  property, tangible or intangible, or labor or services actually received
  by or performed for the  corporation  or  for  its  benefit  or  in  its
  formation or reorganization, or a combination thereof. In the absence of
  fraud  in  the transaction, the judgment of the board as to the value of
  the consideration received by the corporation shall be conclusive.
    (b) A corporation may pay reasonable interest on its bonds, may  issue
  its  bonds at a reasonable discount and may pay a reasonable premium for
  the redemption thereof prior to maturity, but the holders of  its  bonds
  shall  not  be entitled at any time to receive any part of the income or
  profit of the corporation nor at  maturity  to  receive  more  than  the
  principal  sum  thereof  plus  interest  due and accrued thereon. In the
  absence of fraud in the transaction, the judgment of the board as to the
  reasonableness of any  such  interest,  discount  or  premium  shall  be
  conclusive.  However,  with  respect  to  bonds  not  a part of a public
  offering, notwithstanding the terms of the instrument, no  member  of  a
  corporation  shall  be entitled to receive, directly or indirectly, as a
  holder or beneficiary of such bond, prior  to  maturity  or  redemption,
  more  than  simple interest thereon at a rate equal to the higher of (1)
  the maximum interest authorized pursuant to section 5-501 of the general
  obligations law or (2) one percent  over  the  prime  rate  of  interest
  generally  prevailing  on  the  interest due date in the Federal Reserve
  District of New York, nor at  maturity  or  redemption,  more  than  the
  principal  sum  thereof  plus  any  interest,  not exceeding the maximum
  interest herein specified, due and accrued thereon.
    (c) A corporation may, in its certificate of incorporation or by-laws,
  confer upon the holders of any bonds issued  or  to  be  issued  by  the
  corporation, rights to inspect the corporate books and records and, upon
  default  of interest or principal, to vote in the election of directors.
  The certificate of incorporation or the by-laws may apportion the number
  of votes that may be cast with respect to bonds  on  the  basis  of  the
  amount of bonds held.
    (d) The board may authorize any mortgage or pledge of, or the creation
  of a security interest in, all or any part of the corporation's personal
  property,   or   any   interest   therein.  Unless  the  certificate  of
  incorporation provides otherwise, no vote  or  consent  of  the  members
  shall be required to approve such action by the board.