N.Y. Comp. Codes R. & Regs. tit. 21 § 4209.4

Current through Register Vol. 46, No. 50, December 11, 2024

Section 4209.4 - Assistance

(a) A regional corporation may use trust funds to provide the following types of assistance for eligible projects undertaken by eligible businesses:

(1) loan guarantees; and

(2) working capital loans.

(b) Loan guarantees may be made:

(1) solely to guarantee repayment of short- and medium-term loans for working capital, revolving lines of credit, and seasonal inventory and accounts-receivable loans advanced by banking organizations, provided such loans are secured by a security agreement, chattel paper, loan agreement, or such other instruments or documents deemed necessary or convenient by the regional corporation;

(2) for an amount which shall not exceed the lesser of 90 percent of the total project cost, or $100,000. Notwithstanding anything to the contrary in this paragraph, a loan guarantee may be made for up to 90 percent of the total project cost up to a maximum of $150,000 for interim financing where another lender or guarantor will provide permanent financing within 180 days;

(3) for a term not to exceed five years; and

(4) if it can be backed by a reserve (determined by the regional corporation) within the regional corporation's loan fund account of between 25 percent and 100 percent of the amount of the loan guarantee.

(c) Working capital loans may be made:

(1) for an amount not to exceed the lesser of 90 percent of the total project cost or $100,000;

(2) at interest rates determined by the regional corporation, which in no event shall be less than five percent;

(3) for a term not to exceed five years; and

(4) provided they are secured by lien positions on collateral at the highest level of priority that can accommodate an eligible business's ability to raise sufficient debt and equity capital to implement an eligible project.

(d) A regional corporation shall deposit any principal repaid by an eligible business to the regional corporation for a working capital loan into the regional corporation's loan fund account.

N.Y. Comp. Codes R. & Regs. Tit. 21 § 4209.4

Renumbered from 4209.5 New York State Register July 11, 2018/Volume XL, Issue 28, eff. 7/11/2018