(a) Except as provided by subsection (c), a corporation may not lend money to or guarantee the obligation of a director of the corporation unless:
- (1) the particular loan or guarantee is approved by a majority of the votes represented by the outstanding voting shares of all classes, voting as a single voting group, except the votes of shares owned by or voted under the control of the benefited director; or
- (2) the corporation's board of directors determines that the loan or guarantee benefits the corporation and either approves the specific loan or guarantee or a general plan authorizing loans and guarantees.
- (b) The fact that a loan or guarantee is made in violation of this section does not affect the borrower's liability on the loan.
- (c) This section does not apply to loans and guarantees authorized by statute regulating any special class of corporations.
As added by P.L.149-1986, SEC.19.