Ch. 704

LAWS OF MARYLAND

(a)     The Authority may utilize the Guaranty Fund to

guarantee up to 80 percent of the principal of and interest on a

long-term loan made by a financial institution to an applicant
only if:

(1)  The applicant meets the requirements of § 13-231
and has not violated any provisions of § 13-233.4 of this
subtitle;

(2)  The loan amount is not less than $5,000 and not
more than $500,000;

(3)  The loan is to be used by the applicant for:

(I)   [working] WORKING capital [or];

(II)   [the] THE acquisition AND RELATED
INSTALLATION of machinery or equipment; OR

(III)  NECESSARY IMPROVEMENTS TO REAL PROPERTY
OWNED IN FEE SIMPLE BY THE APPLICANT, BUT IN NO CASE SHALL THE
PORTION OF THE LOAN USED FOR IMPROVEMENTS TO REAL PROPERTY EXCEED
ONE HALF OF THE ENTIRE LOAN AMOUNT; OR

(IV) ACQUISITION OF REAL PROPERTY IN FEE SIMPLE
BY THE APPLICANT IN CONNECTION WITH THE EXTENSION OF EQUITY
PARTICIPATION FINANCING TO THE APPLICANT UNDER SECTIONS 13-235
THROUGH 13-241 OF THIS SUBTITLE;

(4)  The loan shall mature in not less than 1 year and
not more than 10 years from the date of closing of the loan; and

(5)  The; rate of interest on the loan is no greater
than the rate of interest determined by the Authority to be the
monthly weighted average of the prime lending rate, plus 1
percent, prevailing from time to time in the City of Baltimore on
unsecured commercial loans.

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall
take effect July 1, 1987.

Approved June 2, 1987.

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