94- 457 C.M.R. ch. 3, § 6

Current through 2024-51, December 18, 2024

Section 457-3-6 - Terms and Conditions

A. Loans must be secured by collateral having a fair market value (ordinarily determined by appraisal) sufficient to provide adequate security for the loan. The Authority may, in the reasonable exercise of its judgment, require assignments of leases or contracts in favor of the Loring Development Authority or one or more trustees acting on behalf of the bondholders, as applicable, secured or unsecured personal or corporate guarantees, and letters of credit.

B. Any project approved for a Certificate of Approval shall include covenants requiring the borrower to:

1. Make periodic payments of principal and interest;

2. Pay any taxes and governmental charges assessed against the borrower or the collateral;

3. Comply with all applicable federal, state and local laws, regulations and ordinances;

4. Make any lease payments imposed on borrower in connection with the project;

5. Obtain, maintain and pay for insurance against damage to or loss of the collateral;

6. Maintain and repair the collateral;

7. Permit the Loring Development Authority or its agent to inspect the collateral and to inspect and copy the borrower's books and records at any reasonable time;

8. Provide to the Loring Development Authority periodic financial reports in form and content, at times and for periods acceptable to the Loring Development Authority and prepared by persons acceptable to the Loring Development Authority and also provide to the Loring Development Authority, when specifically requested, annual income tax returns;

9. Refrain from transferring any interest in the collateral without the Loring Development Authority's prior written consent;

10. Repay any advances necessary to protect the collateral or enforce the rights of the Loring Development Authority;

11. Execute such further assurances as may be reasonably required;

12. Keep the collateral free from liens and encumbrances not approved in advance in writing by the Loring Development Authority; and

13. If the bonds are tax-exempt, take such action as may be necessary to preserve the tax-exempt status of the bonds.

B. Optional Covenants.

In addition, the Authority may impose such other terms and conditions as it may reasonably deem prudent or desirable to assure sale of bonds at reasonable rates, completion and continuation of the project, preservation of collateral and repayment of the bonds.

94- 457 C.M.R. ch. 3, § 6