Section 3.04 - Loans From the FundMassDevelopment may make and administer Loans from the Fund to finance Environmental Site Assessments and Environmental Cleanup Actions, in accordance with the following provisions:
(1)General Provisions.(a) No Loan shall be given unless:1. the Borrower submits an Application in accordance with 946 CMR 3.06; and2. the Borrower, in MassDevelopment's opinion, satisfies the requirements and criteria contained in 946 CMR 3.04 and 3.06.(b) No Loan shall be made to finance an Environmental Site Assessment or an Environmental Cleanup Action that is eligible for funding under M.G.L. c. 21J. Eligibility under M.G.L. c. 21J shall be evidenced by the issuance of a Certificate of Eligibility in accordance with 503 CMR 2.00et seq.(c) No Loan shall be given to finance an Environmental Site Assessment or an Environmental Cleanup Action unless the Borrower certifies in the Application and in the Loan documents that the Borrower shall transfer the results of the Environmental Site Assessment to the appropriate regional office of the Department of Environmental Protection if the Borrower does not proceed with the development of the Project after the performance of an Environmental Site Assessment.(2)Loan Amounts.(a) The maximum amount of a Loan for an Environmental Cleanup Action relating to an Eligible Project (which is not a Priority Project) shall not exceed $500,000.(b) The maximum amount of a Loan for an Environmental Site Assessment relating to an Eligible Project (which is not a Priority Project) shall not exceed $50,000.(c) The maximum a mount of financing available from the Fund for an Environmental Site Assessment and an Environmental Cleanup Action for a Priority Project shall not exceed $2,000,000.(d) No Loan shall be given in the total estimated amount required to complete a response action at a Project Site. Borrower shall provide evidence satisfactory to MassDevelopment that the Borrower has secured a Requisite Match to the Loan, in an amount to be determined by MassDevelopment. Notwithstanding the foregoing, MassDevelopment may waive the requirement of the Requisite Match and provide funding for the entire response action.(3)Loan Structure.(a) MassDevelopment may structure a Loan from the Fund in the following forms:2. a guarantee of Borrower's debt 4. obtaining a line of credit; or5. obtaining a letter of credit.(b) Loan proceeds shall be advanced in disbursements, upon receipt by MassDevelopment of invoices and receipts satisfactory to MassDevelopment to reimburse costs incurred by the Borrower in connection with performing an Environmental Site Assessment or Environmental Cleanup Action only. Loan proceeds may only be used to reimburse costs incurred for work approved by MassDevelopment.(4)Loan Security.(a) A Loan shall be secured by collateral in the form and amount as determined by MassDevelopment, which may include, but shall not be limited to, the following:1. a first lien real estate mortgage and security agreement on the Project Site, or other real property owned by Borrower and any Guarantor;2. a first lien security interest on personal property and other tangible and intangible property and assets at or related to the Project Site, owned by the Borrower and any Guarantor, including without limitation, all accounts, funds, proceeds, fixtures, equipment, machinery, profits, products, leases, licenses, patents, trademarks, copyrights and contracts;3. a first lien pledge of personal property and other tangible and intangible property at or related to the Project Site, owned by the Borrower and any Guarantor, including without limitation, all accounts, funds, proceeds, and profits;4. a first lien assignment of leases, rents, contracts, permits, development rights or other rights or interests related to the Project Site, owned by the Borrower and any Guarantor; and5. pledge of options or warrants for the purchase of stock, shares of stock, or other forms of equity owned by the Borrower and/or any Guarantor.(b) Any security given in connection with a Loan may, in MassDevelopment's discretion, be subordinate to other financing obtained by a Borrower in connection with the acquisition, remediation or development of a Project Site.(5)Loan Interest Rates. The interest rate due and payable under a Loan shall be determined by MassDevelopment at a rate comparable to then-prevailing commercial loan rates set by MassDevelopment for brown fields transactions. Notwithstanding the foregoing, MassDevelopment may set an interest rate for a Loan that is below its prevailing rates in order to make an Eligible Project financially feasible .(6)Loan Terms and Conditions. Loans shall be made upon terms and conditions outlined in a commitment letter drafted by MassDevelopment and accepted by the Borrower. The terms and conditions for each Loan shall be determined by MassDevelopment in accordance with its internal underwriting criteria and shall be based upon MassDevelopment's review of the Application, the financial statements, the anticipated economic impact associated with the Eligible Project, and any other documents required by MassDevelopment from the Borrower and any Guarantor or Matching Party.(7)Legal Documents. Any Loan made from Fund shall be documented by standard loan documents by and between MassDevelopment, the Borrower, the Guarantor or Matching Party, if any, and any other party required by the Fund's legal counsel.