AS 44.88.730: Conditions of loan guarantee.

(a) The authority may guarantee a loan under AS 44.88.700 — 44.88.799 if the

(1) loan

(A) is commercially reasonable;

(B) contains payment provisions satisfactory to the authority; and

(C) is secured by acceptable collateral;

(2) project

(A) is allocated new markets tax credits by a qualified community development entity;

(B) promotes economic development in the state; and

(C) is not a housing project;

(3) borrower demonstrates the ability to repay the loan from either or both of the following:

(A) net cash flow of the borrower;

(B) proceeds from the sale of current assets that are collateral for the loan if the sale or receipt of proceeds from the sale is an event that creates a payment obligation; in this subparagraph, “current asset” means property that will be or could be converted into cash within one year in the normal operation of a business;

(4) term of the loan does not exceed 10 years;

(5) loan is originated with and serviced by a financial institution.

(b) The authority may provide a guarantee for up to 100 percent of a loan that qualifies under AS 44.88.700 — 44.88.799.