N.Y. Public Authorities Law § 1836-e: Loan agreements

§ 1836-e. Loan agreements. 1. If the authority approves an application

for a loan under this subtitle, the local development corporation may

enter into a loan agreement with the employee ownership association

whereby the local development corporation agrees to loan to the employee

ownership association the remaining funds necessary for the eligible

project.

2. No such loan may exceed forty percent of the cost of the project

and the repayment of such loan shall be secured by a mortgage thereon

which shall not be a junior encumbrance thereon by more than fifty

percent of such cost, and by means of the guarantees of the loans made

by banking organizations which guaranty shall not exceed eighty percent

of the cost of the project, except as provided in paragraphs (a) and (b)

of subdivision two of section eighteen hundred three and paragraph (a)

of subdivision seven of section eighteen hundred twenty-three of this

chapter.

3. The local development corporation may not enter into any loan

agreement unless the authority determines through an appropriate method

that there is reasonable assurance of repayment. The authority shall

establish such requirements or terms as it may deem necessary or

desirable to secure the repayment of the loan and to protect the

interests of the authority and the holders of its bonds.

4. Subject to the requirements of this subtitle, the authority is

authorized to determine the form and substance of any loan agreement

made pursuant to this subtitle.