(a) Plan lender; eligible plan.
(1) Plan lender means any corporation,
(including a wholly owned subsidiary, or a lender that is a thrift
organization whose membership is limited to employees and former employees
of the corporation, its subsidiaries or affiliates) that extends or
maintains credit to finance the acquisition of margin stock of the
corporation, its subsidiaries, or affiliates under an eligible plan.
(2) Eligible plan means any employee stock option, purchase, or ownership plan adopted
by a corporation and approved by its stockholders that provides for
the purchase of margin stock of the corporation, its subsidiaries,
or affiliates.
5-761.1
(b) Credit to exercise rights under or finance an
eligible plan.
(1) If a plan lender extends or maintains
credit under an eligible plan, any margin stock that directly or indirectly
secured that credit shall have good faith loan value.
(2) Credit extended under
this section shall be treated separately from credit extended under
any other section of this part except section 221.3(b)(1) and (b)(3).
(c) Credit to ESOPs. A nonbank lender may extend and maintain purpose credit
without regard to the provisions of this part, except for section
221.3(b)(1) and (b)(3), if such credit is extended to an employee
stock ownership plan (ESOP) qualified under section 401 of the Internal
Revenue Code, as amended (26 USC 401).
