Section 10.06.485. Loans to directors, officers, and employees.

   (a) A loan may not be extended to an officer or employee without authorization by the board. A loan may not be extended to a director without the approval of two-thirds of the voting shares. An employee or officer who is also a director is considered a director for purposes of this section. A shareholder is not disqualified from voting on a loan to a shareholder as a director because of personal interest.
   (b) A loan to a director, officer, or employee and a loan secured by the shares of the corporation may not be made unless the loan would be permissible as a distribution under AS 10.06.358 - 10.06.365. A loan under this subsection impairs the retained earnings or paid-in capital accounts to the extent of the loan.
   (c) For purposes of this section, a loan may consist of cash, securities, or personal or real property.
   (d) If a corporation acts as a guarantor on a loan to a director, officer, or employee, the guarantee is treated as a loan under this section.
   (e) A director, officer, or employee of an affiliate corporation is a director, officer, or employee of the lending corporation for purposes of this section.
   (f) A loan is to be judged by the duties of directors and officers to act in good faith in a manner reasonably believed to be in the best interests of the corporation and with the care, including reasonable inquiry, that an ordinarily prudent person in a like position would use under similar circumstances.

Authorities

10.06.480

Notes

References

AS 10.06.480 Liability of directors and contributions from shareholders and other directors.

History

(Sec. 1 ch 166 SLA 1988)