1553 - Second Stage Loan Program.

     § 1553.  Second Stage Loan Program.        (a)  Establishment.--There is established a program to be     known as the Second Stage Loan Program. The program shall     provide loan guarantees to commercial lending institutions that     make loans to life sciences, advanced technology or     manufacturing businesses.        (b)  Application for enrollment.--A commercial lending     institution may apply for enrollment in the program authorized     by this section. The application shall be on the form prescribed     by the board and shall include or demonstrate all of the     following:            (1)  The name and address of the commercial lending        institution and the name and title of the individual who will        serve as the point of contact for the commercial lending        institution.            (2)  A statement defining the service area of the        commercial lending institution.            (3)  A statement describing the commercial lending        activities engaged in by the commercial lending institution        and how the institution intends to expand those activities as        a result of its participation in the program authorized by        this section.            (4)  Any other information required by the board.        (c)  Enrollment approval.--Upon being satisfied that all     requirements have been met, the board may enroll the commercial     lending institution in the program authorized by this section,     and, if enrolled, the authority shall execute a master guarantee     agreement in favor of the commercial lending institution. In     addition to any other terms and conditions required by the     board, the master guarantee agreement shall provide for the     following:            (1)  The procedure for the submission of a claim for        payment by the commercial lending institution. This procedure        shall require that the commercial lending institution        demonstrate that it has exhausted all available remedies        against the borrower, other guarantors and collateral for the        loan before seeking payment under the agreement.            (2)  A requirement that a percentage of any moneys        recovered by the commercial lending institution subsequent to        any payment made under the master guarantee agreement by the        authority be remitted to the authority.            (3)  Periodic reporting requirements by the commercial        lending institution regarding itself and regarding the loans        for which guarantee certificates have been issued under this        section.        (d)  Application for guarantee.--A commercial lending     institution enrolled in the program authorized by this section     may submit an application to the authority for the guarantee of     a proposed loan. The application shall be on the form prescribed     by the board and shall include or demonstrate all of the     following:            (1)  The name and address of the borrower, the type of        business the borrower conducts, the location and age of the        business and the names and addresses of the principals of the        borrower.            (2)  The number of projected new or retained employees of        the borrower as a result of the loan.            (3)  A copy of the borrower's last two years of financial        statements prepared or reported on by an independent        certified public accountant.            (4)  A statement describing the purpose of the loan, the        requested amount of the loan, a copy of the commercial        lending institution's commitment letter and applicable credit        underwriting that supports the repayment of the loan, as well        as the collateral and other guarantees offered by the        borrower to support the loan.            (5)  Any other information required by the board.        (e)  Application review.--            (1)  The board shall review the application to determine        all of the following:                (i)  That the borrower owns and operates a life            sciences, advanced technology or manufacturing business.                (ii)  That the borrower's business has been in            existence for at least two years but no more than seven            years at the time of application.                (iii)  That the borrower is financially responsible            and has the ability to repay the loan.                (iv)  That the use of loan proceeds by the borrower            will result in jobs being created or retained within this            Commonwealth.                (v)  That the borrower's business is located within            the commercial lending institution's service area and            within this Commonwealth.                (vi)  That the borrower and the commercial lending            institution have met all other requirements established            by the board.            (2)  Upon being satisfied that all requirements have been        met, the board may approve the guarantee, and, if approved,        the authority shall issue a guarantee certificate for the        loan to the commercial lending institution stating the terms        and amount of the guarantee.            (3)  The board may establish a subcommittee composed of        one or more members of the board and staff of the department        to review and approve applications for guarantees under this        section.        (f)  Limitations.--            (1)  During the first two years of the term of a loan for        which a guarantee certificate has been issued, the guarantee        may not exceed 50% of the outstanding principal amount of the        loan. From the end of year two through either the end of year        seven or the end of the term of the loan, whichever occurs        first, the guarantee may not exceed 25% of the outstanding        principal amount of the loan. The guarantee will terminate at        the end of seven years.            (2)  At no time may a guarantee exceed $1,000,000 for any        one loan.        Cross References.  Section 1553 is referred to in section     1543 of this title.