13 C.F.R. § 307.20   Partial liquidation and liquidation upon termination.


Title 13 - Business Credit and Assistance


Title 13: Business Credit and Assistance
PART 307—ECONOMIC ADJUSTMENT ASSISTANCE INVESTMENTS
Subpart B—Special Requirements for Revolving Loan Funds and Use of Grant Funds

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§ 307.20   Partial liquidation and liquidation upon termination.

(a) Partial liquidation. EDA may require an RLF Recipient to transfer any RLF loans that are more than one hundred and twenty (120) days delinquent to an RLF Third Party for liquidation.

(b) Liquidation upon termination. When EDA approves the termination of an RLF Grant, EDA may assign or transfer assets of the RLF to an RLF Third Party for liquidation.

(c) Terms. The following terms will govern any liquidation:

(1) EDA shall have sole discretion in choosing the RLF Third Party;

(2) The RLF Third Party may be an Eligible Applicant or a for-profit organization not otherwise eligible for Investment Assistance;

(3) EDA may enter into an agreement with the RLF Third Party to liquidate the assets of one (1) or more RLFs or RLF Recipients;

(4) EDA may allow the RLF Third Party to retain a portion of the RLF assets, consistent with the agreement referenced in paragraph (c)(3) of this section, as reasonable compensation for services rendered in the liquidation; and

(5) EDA may require additional reasonable terms and conditions.

(d) Distribution of proceeds. The proceeds resulting from any liquidation upon termination shall be distributed in the following order of priority:

(1) First, for any third party liquidation costs;

(2) Second, for the payment of EDA's Federal Share (as defined in §314.5 of this chapter); and

(3) Third, if any proceeds remain, to the RLF Recipient.

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