1. (1) A lender may apply to the Department to enroll a Qualified Loan in the Program. The Department, at its sole discretion will determine whether a Loan is eligible and meets all the requirements for enrollment.

2. (2) A Qualified Loan does not mean a loan:

   1. (a) With a variable interest rate;
   2. (b) With an origination fee that exceeds 1.5%, and with an annual interest rate that exceeds the lesser of 18% or the Prime Rate plus 7%;
   3. (c) With an origination fee that is equal to or exceeds 1.5%;
   4. (d) With an annual interest rate that exceeds the lesser of 18% or the Bank Short-Term Rate plus 7%;
   5. (e) That results in more than $250,000 being enrolled into the Program for any Business, or any affiliates or subsidiaries of a Business;
   6. (f) For working capital with a term exceeding seven years;
   7. (g) For working capital with an amortization exceeding seven years;
   8. (h) For capital assets with a term exceeding the useful life of the assets;
   9. (i) For capital assets with amortization exceeding the useful life of the assets;
   10. (j) For the purchase of real property that is not used for the business operations of the Borrower;
   11. (k) For the purchase of owner-occupied residential housing;
   12. (l) For the construction, improvement or purchase of residential housing that is owned, or to be owned, by the Principal or their immediate family members.
   13. (m) For the purchase of securities;
   14. (n) For the purpose of lobbying activities;
   15. (o) For the purpose of repayment of delinquent federal, state, county or other local government taxes; and,

   16. (p) That includes, in whole or part:

       1. (A) The refinancing of an existing loan made by the lender to the Borrower;
       2. (B) The refinancing of an existing loan enrolled in another state or federal credit enhancement or credit insurance program;
       3. (C) The refinancing of an existing personal loan not used for business purposes;
       4. (D) Reimbursement of funds owed to any owner, including funds to repay any equity injection or injection of capital for the business’ continuance;

3. (3) The Principals of a Qualified Loan may not be:

   1. (a) An executive officer, director, or principal shareholder of the lender;
   2. (b) A member of the immediate family of an executive officer, director or principal shareholder of the lender;
   3. (c) A person with a related interest to any of the persons described in paragraphs (3)(a) or (3)(b) above; or,
   4. (d) Delinquent on federal, state or local taxes.  A Business that has entered into, and is current on, a repayment agreement with the applicable taxing authority is not considered to be delinquent.
4. (4) The Business and the activities of the Business must be compliant with all federal, state or local laws.

Statutory/Other Authority

ORS 285A.075 & ORS 285B.780 - ORS 285B.799

Statutes/Other Implemented

ORS 285B.780 - ORS 285B.799

History

OBDD 9-2023, adopt filed 06/13/2023, effective 06/13/2023