California Code of Regulations › Title 10 - Investment › Chapter 7 - Business, Transportation and Housing Agency: Small Business Loans and Guarantees › Article 2 - Loan Guarantees › Section 5001 - Guarantee Procedures

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
The potential Borrower applying for a Guarantee shall provide
				  a completed Application to the Corporation for review and processing in
				  accordance with the following procedures:
(a) No Guarantee shall be executed by a
				Corporation until the proposed Guarantee has been reviewed by the Corporation's
				loan committee and approved by its Board of Directors, unless the Corporation's
				Board of Directors has delegated the authority to approve a proposed Guarantee
				to the Corporation's loan committee. No Guarantee shall be approved or executed
				by a Corporation if the Lender is the same entity as the Corporation issuing
				the Guarantee.
(b) Upon completion
				of the review and approval by the Corporation's loan committee and/or Board of
				Directors, the Corporation shall issue a commitment to Guarantee and an
				executed Guarantee to the Lender.
(c) In the event that a Guarantee is issued
				to a Lender without first complying with the requirements of subsection (a),
				and the Lender relies upon the Guarantee in making the Loan, the failure by the
				Corporation to so comply shall not constitute a defense on the part of either
				the Agency or the Corporation to paying a Demand for payment made pursuant to
				section 5003.
(d) In any case where funds are disbursed to
				a Lender pursuant to a Demand and the Corporation has failed to comply with
				subsection (a), the Agency shall immediately exercise all available legal
				remedies to recover from the Corporation the funds disbursed pursuant to the
				Demand.
1. Order of
				  Repeal filed 6-3-85 by OAL pursuant to Government Code Section
				  11349.7;
				  effective thirtieth day thereafter (Register 85, No. 26).
2.
				  Repealer and new section filed 6-24-91; operative 7-24-91 (Register 91, No.
				  42).
3. Amendment of subsections (a)-(c) filed 6-9-97 as an
				  emergency; operative 6-9-97 (Register 97, No. 24). A Certificate of Compliance
				  must be transmitted to OAL by 10-7-97 or emergency language will be repealed by
				  operation of law on the following day.
4. Reinstatement of
				  subsections (a)-(c) as they existed prior to 6-9-97 emergency amendment by
				  operation of Government Code section
				  11346.1(f)
				  (Register 98, No. 30)
5. Amendment of subsections (a)-(c) and NOTE
				  filed 7-24-98; operative 7-24-98 pursuant to Government Code section
				  11343.4(d)
				  (Register 98, No. 30).
6. Amendment of subsections (c)-(d) filed
				  12-27-2004 as a deemed emergency pursuant to Corporations Code section
				  14024;
				  operative 12-27-2004 (Register 2004, No. 53). A Certificate of Compliance must
				  be transmitted to OAL by 6-27-2005 or emergency language will be repealed by
				  operation of law on the following day.
7. Editorial correction of
				  HISTORY 6 (Register 2005, No. 27).
8. Certificate of Compliance as
				  to 12-27-2004 order, including amendment of NOTE, transmitted to OAL 5-25-2005
				  and filed 7-7-2005 (Register 2005, No. 27).
Note: Authority cited: Section
					 14024,
					 Corporations Code. Reference: Sections
					 14055,
					 14060,
					 14064
					 and
					 14071,
					 Corporations Code.