Compilation of Rules and Regulations of the State of Georgia › Department 413 - GRANTS OF THE ONEGEORGIA AUTHORITY › Chapter 413-6 › Subject 413-6-1 - ENTREPRENEUR AND SMALL BUSINESS DEVELOPMENT › Rule 413-6-1-.10 - Awarding of Guarantees and Subsequent Funds

Current through Rules and Regulations filed through June 27, 2024
ESBD loan guarantees to the Lender will be made in the form
				 of an agreement and shall generally carry the following terms:
(1) ESBD limits loan guarantees from $15,750
				to $112,500 based on a total project cost of $35,000 to $250,000. These limits
				can be waived upon recommendation of the Executive Director of the OneGeorgia
				Authority.
(2) The exact terms of
				the loan will be negotiated between the Lender and the sub-recipient business;
				however, the interest rate shall not exceed prime +2%.
(3) Once approved, the guarantee agreement
				made available by the OneGeorgia Authority or its Agent constitutes a legal
				agreement incorporating by reference the approved final application and adding
				any conditions that may be necessary or appropriate.
(4) As part of the guarantee conditions,
				lenders must file a final report on the impact and performance of the project,
				in a format prescribed by the OneGeorgia Authority or its Agent.
(5) The OneGeorgia Authority or its Agent may
				approve a guarantee subject to certain conditions that will be incorporated
				into the guarantee agreement. Because of the limited amount of funds available,
				the One Georgia Authority or its Agent may also guarantee an amount less than
				the amount requested in the application. Lenders will have thirty (30) days
				from the date of the guarantee agreement to accept any conditions and/or the
				reduced guarantee amount. If the applicant fails to accept the conditions or
				lower guarantee amount within the required period, the OneGeorgia Authority
				and/or the Agent with One Georgia Authority approval may unilaterally withdraw
				the guarantee.
(6) The OneGeorgia
				Authority or its Agent will provide lenders with specific instructions and
				forms to be used under the guarantee agreement.
(7) The term of the guarantee shall not
				exceed the lesser of ten years from the date of issuance of the guarantee OR
				the amortized useful life of the financed asset.
(8) The Lender's right to exercise the
				guarantee shall be enumerated in the ESBD Loan Guarantee Agreement; however,
				the following minimum stipulations must exist or be satisfied before a Lender
				may exercise the guarantee:
A) The
				Sub-Recipient must have defaulted on the Lender's loan pursuant to applicable
				requirements, covenants and terms contained within properly recorded loan and
				security documents;
B) The Lender
				must have exhausted all collateral foreclosure and recapture actions available
				to it pursuant to properly recorded loan and security documents; and
C) The maximum amount of the Lender's
				reimbursement under the Guarantee will be 50% of the original principal amount
				of the loan not collected through the sub-recipient's regular amortization of
				the approved loan or amounts collected under items A and B above.