N.Y. Public Authorities Law § 1835-c: Loans to lenders

§ 1835-c. Loans to lenders. 1. The authority shall have the power and

is hereby authorized to make and contract to make loans to lenders on

such terms and conditions as it shall determine, and all lenders are

authorized to borrow from the authority in accordance with the

provisions of this section and upon such terms and conditions as the

authority may impose, provided that the business development corporation

established under article five-A of the banking law shall receive no

more than five million dollars and any other lender shall receive no

more than two million dollars in loans to lenders from the authority in

any twelve month period.

2. The authority shall require as a condition of each loan to a lender

that such lender enter into written commitments to make within such

period of time as the authority may require loans for agricultural

business projects in accordance with the standards and criteria

prescribed by the authority. Such loans for agricultural business

projects shall be in an aggregate principal amount equal to the amount

of such loan to the lender and shall require the disbursement of such

loan proceeds by the lender to borrowers to pay the costs of such

projects; provided that no borrower shall receive more than two hundred

thousand dollars in loans for agricultural business projects that are

financed by loans to lenders from the authority in any twelve month

period.

3. The authority shall require the submission to it by each lender to

which the authority has made a loan to lender such documentation and

other evidence satisfactory to the authority that the lender has made

loans for agricultural business projects in accordance with the

standards and criteria prescribed by the authority, and in this

connection the authority through its members, agents and employees may

inspect the books and records of such lender.

4. The authority shall require that each lender receiving a loan to

lender pursuant to this section shall issue and deliver to the authority

an evidence of its indebtedness to the authority which shall constitute

an unconditional obligation of such lender and shall bear such date or

dates, shall mature at such times or times, shall be subject to

prepayment and shall contain such other provisions consistent with this

subtitle as the authority shall require.

5. Notwithstanding any other provision of this subtitle, the interest

rate and other terms of loans to lenders made from the proceeds of any

issue of loans to lenders bonds or notes of the authority shall be at

least sufficient to assure the payment of principal, redemption premium,

if any, and interest on such bonds and notes as the same become due and

payable.

6. The authority may require that loans to lenders made pursuant to

this subtitle shall be secured as to the payment of both principal and

interest by a pledge of collateral security in such amounts as the

authority may determine to be necessary to assure the payment of such

loans and the interest thereon as the same become due and payable. Such

collateral security may consist of (a) obligations of or guaranteed by

the United States of America, (b) obligations of the state or

obligations the principal and interest of which are guaranteed by the

state, excluding any obligations of the authority, (c) obligations of

any corporation wholly owned by the United States of America, (d)

obligations of any corporation sponsored by the United States of America

which are or may become eligible as collateral for advances to member

banks as determined by the board of governors of the federal reserve

system, or (e) certificates of deposit or time deposits secured in such

manner, if any, as the authority shall determine.

7. The authority may require that any collateral security for loans to

lenders be deposited with a bank, trust company or other financial

institution (other than the lender pledging such collateral security)

which shall be located in the state and designated by the authority as

custodian therefor or may require each lender to enter into an agreement

with the authority containing such provisions as the authority shall

require to (a) adequately identify and maintain such collateral

security, (b) service such collateral security, and (c) require the

lender to hold such collateral security in trust for the authority and

be accountable to the authority as the trustee of an express trust. The

authority may also establish such additional requirements as it shall

deem necessary with respect to the pledging, assigning, setting aside or

holding of such collateral security and the making of substitutions of

or additions thereto and the disposition of income and receipts

therefrom.

8. The authority may require as a condition of any loans to lenders

such representations and warranties as it shall determine to be

necessary to secure such loans and carry out the purposes of this

subtitle, and may make and execute contracts for the administration,

servicing or collection of any loans to lenders or other financing with

a lender and may pay the reasonable value of services rendered to the

authority pursuant to such contracts.