Maryland Code, CORPORATIONS AND ASSOCIATIONS 2-416
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Terms Used In Maryland Code, CORPORATIONS AND ASSOCIATIONS 2-416
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- including: means includes or including by way of illustration and not by way of limitation. See
- Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
(a) A corporation may lend money to, guarantee an obligation of, or otherwise assist an officer or other employee of the corporation or of its direct or indirect subsidiary, including an officer or employee who is a director of the corporation or the subsidiary, if the loan, guarantee, or assistance:
(1) In the judgment of the directors, reasonably may be expected to benefit the corporation; or
(2) Is an advance made against indemnification in accordance with § 2-418(f) of this subtitle.
(b) The loan, guarantee, or other assistance may be:
(1) With or without interest;
(2) Unsecured; or
(3) Secured in any manner that the board of directors approves, including a pledge of the stock of the corporation.