N.Y. Not-for-Profit Corporation Law § 716: Loans to directors, officers and key persons

§ 716. Loans to directors, officers and key persons.

No loans, other than through the purchase of bonds, debentures, or

similar obligations of the type customarily sold in public offerings, or

through ordinary deposit of funds in a bank, shall be made by a

corporation to its directors, officers or key persons, or to any other

corporation, firm, association or other entity in which one or more of

its directors, officers or key persons are directors, officers or key

persons or hold a substantial financial interest, except a loan by one

charitable corporation to another charitable corporation. A loan made in

violation of this section shall be a violation of the duty to the

corporation of the directors or officers authorizing it or participating

in it, but the obligation of the borrower with respect to the loan shall

not be affected thereby.