Section 4019 - Eligibility for a Guarantee to a Farm Enterprise(a) A Corporation shall only execute a Guarantee to a Farm Enterprise upon a finding of eligibility. The Corporation's board of directors shall adopt a resolution that the Borrower and the Loan meet each of the eligibility findings. The eligibility resolution will be part of the board of directors' minutes of the meetings in which the Guarantee was approved. A finding of eligibility shall include all of the following: (1) The Borrower is the owner of a Farm Enterprise.(2) The Guarantee is necessary because the Farm Enterprise suffered a significant economic injury related to the disaster.(3) At least 50 percent of the Borrower's revenue during the calendar year in which the disaster occurred originated from locations in the Disaster Area.(4) Loan proceeds will be used to fund Physical Damage and/or Economic Injury costs. (A) One year of operating expenses shall be included as part of the Economic Injury costs, if necessary to sustain the farm production.(5) Borrower is creditworthy.(6) Loan proceeds will not be used to bring the Borrower's economic circumstances to a condition better than before the disaster occurred.(7) The total approved Guarantees will not exceed the total authorized by the Agency.(8) Loans approved are in accordance with Section 14071 of the California Corporations Code.(b) Loan Guarantees as provided in subsection (a)(4)(A) shall be eligible for renewal on a yearly basis.(c) An eligible Borrower is eligible for the following Guarantees:(1) One Line of Credit Guarantee. The term of the Line of Credit Guarantee cannot exceed twenty-four (24) months. The Guarantee must be issued within six-months of receipt of the Borrower's original Application. Upon the maturity of the Line of Credit, the Line of Credit Guarantee can be renewed or converted into a term loan in amounts less than or equal to the original Line of Credit Guarantee. A renewed Line of Credit Guarantee would be issued for an additional period that cannot exceed twenty-four (24) months. A Line of Credit Guarantee converted into a term loan would be fully amortizing over a seven-year period.(2) One Term Loan Guarantee. The term loan can have up to a 12-month interest-only period; however, the Term Loan must be fully amortized on the seven-year maturity date. The Guarantee must be issued within six-months of receipt of the Borrower's original Application.(d) A Borrower may receive one or more additional Guarantees, which can be either Term Loans or Line of Credit Guarantees, provided the purpose of the additional Guarantee(s) is to preserve collateral and/or prevent the State from paying a loss claim on a Guarantee made to a Borrower under subsection (c) of this section. The Corporation must obtain permission from the Director in writing before issuing an additional Guarantee.Cal. Code Regs. Tit. 10, § 4019
1. New section filed 3-22-91 as an emergency; operative 3-22-91 (Register 91, No. 16). A Certificate of Compliance must be transmitted to OAL by 7-22-91 or emergency language will be repealed by operation of law on the following day.
2. Repealer filed 3-19-92 as an emergency; operative 3-19-92 (Register 92, No. 15). A Certificate of Compliance must be transmitted to OAL 7-17-92 or emergency language will be repealed by operation of law on the following day.
3. Renumbering of former section 4019 to section 4619 and new section 4019 filed 6-2-92; operative 6-2-92 (Register 92, No. 24).
4. Amendment of subsection (c), new subsections (c)(1)-(3) and amendment of NOTE filed 2-11-2002; operative 3-13-2002 (Register 2002, No. 7).
5. Amendment 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.
6. Editorial correction of HISTORY 5 (Register 2005, No. 27).
7. 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 14075(b), Corporations Code. Reference: Sections 14060, 14067, 14068, 14071 and 14075(a), Corporations Code.
1. New section filed 3-22-91 as an emergency; operative 3-22-91 (Register 91, No. 16). A Certificate of Compliance must be transmitted to OAL by 7-22-91 or emergency language will be repealed by operation of law on the following day.
2. Repealer filed 3-19-92 as an emergency; operative 3-19-92 (Register 92, No. 15). A Certificate of Compliance must be transmitted to OAL 7-17-92 or emergency language will be repealed by operation of law on the following day.
3. Renumbering of former section 4019 to section 4619 and new section 4019 filed 6-2-92; operative 6-2-92 (Register 92, No. 24).
4. Amendment of subsection (c), new subsections (c)(1)-(3) and amendment of Note filed 2-11-2002; operative 3-13-2002 (Register 2002, No. 7).
5. Amendment 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.
6. Editorial correction of History5 (Register 2005, No. 27).
7. 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).