§ 7526 Corporate Funds For Director Nominees

• •A company can't spend its money to support someone running for a director position if there are more people running than there are spots available.
• •The company's board must give permission before any money is spent on supporting a nominee for director.
• •This rule helps keep things fair when too many people want to be directors.

Imagine a school club where only 3 kids can be leaders, but 5 kids want to be leaders.

The club can't use its money to help any of the 5 kids get elected unless the club's board says it's okay. This makes sure the club doesn't play favorites.