<html xmlns="http://www.w3.org/1999/xhtml"><head><meta charset="UTF-8" /><title></title><meta name="Generator" content="PowerTools for Open XML" /><style>span { white-space: pre-wrap; } p.s388d5b66-9559-4337-9243-7cf1760441fdP0 { margin-top: 0; margin-bottom: 0; margin-left: 0; margin-right: 0; text-indent: 0.00in; text-align: justify; background: white; font-family: 'Times New Roman', 'serif'; font-size: 12pt; line-height: 108%; } span.s388d5b66-9559-4337-9243-7cf1760441fdC0 { color: black; background: white; font-family: 'Times New Roman', 'serif'; font-size: 12pt; font-style: normal; font-weight: normal; margin: 0; padding: 0; } span.s388d5b66-9559-4337-9243-7cf1760441fdC0-000000 { color: #0000FF; background: white; font-family: 'Times New Roman', 'serif'; font-size: 12pt; font-style: normal; font-weight: bold; margin: 0; padding: 0; } span.s388d5b66-9559-4337-9243-7cf1760441fdC0-000001 { color: black; background: white; font-family: 'Times New Roman', 'serif'; font-size: 12pt; font-style: normal; font-weight: bold; margin: 0; padding: 0; } span.s388d5b66-9559-4337-9243-7cf1760441fdC0-000002 { color: #0000FF; background: white; font-family: 'Times New Roman', 'serif'; font-size: 12pt; font-style: normal; font-weight: normal; margin: 0; padding: 0; } span.s388d5b66-9559-4337-9243-7cf1760441fd000003 { color: black; background: white; font-size: 12pt; font-style: normal; font-weight: normal; margin: 0; padding: 0; } </style></head><body><div><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    </span><a href="https://sdlegislature.gov/Rules?Rule=68:01:01:05"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000000">68:01:01:05</span></a><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000001">.  Additional loan requirements.</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> Loan requirements in addition to those specified in </span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">SDCL chapter </span><a href="https://sdlegislature.gov/Statutes?Statute=1-16B"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000002">1-16B</span></a><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> are as follows:</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (1)  The amount of the loan, net of the amount required to be deposited in the loan reserve account, may not exceed the lesser of the project costs, plus costs of issuance and capitalized interest, or the sum of the following: </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">eighty</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> percent of the appraised fair market value of the project upon completion, less the outstanding principal amount of any prior mortgage </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">that</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> is not to be discharged with proceeds of bonds of the series, </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">fifty</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> percent of the appraised fair market value of any equipment provided as security, and </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">one hundred</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> percent of the stated amount of any letters of credit or surety obligations;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (2)  To the extent project costs exceed the amount of the loan to be deposited in the loan account, other than to pay costs of issuance, the borrower must provide equity by making a cash contribution or providing a letter of credit, a surety obligation, additional collateral, or some other assurance of completion of the project and payment of project costs;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (3)  The borrower </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> provide title insurance in an amount equal to the loan less the amount deposited in the loan reserve account;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (4)  The borrower </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> provide evidence satisfactory to the authority that the project can be completed in a timely fashion;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (5)  The maximum term of the loan may not exceed </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">eighty</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> percent of the useful life of the project, </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">twenty</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> years, or the final stated maturity of the series of bonds financing the loan, whichever is less;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (6)  The borrower </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> demonstrate to the satisfaction of the authority a capacity to make the </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">scheduled payments of principal and interest on the loan pursuant to the provisions of a loan agreement</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (7)  The borrower </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> demonstrate an adequate source of working capital based on projections;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (8)  A guaranty in favor of the authority must be executed by persons having a </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">twenty-</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">percent</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">-</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">ownership interest in the borrower unless shares of the borrower are traded on a stock exchange or by any corporate guarantor;</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (9)  The borrower </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> supply financial statements for each of the three full fiscal years prior to the date of issuance of the series of bonds and interim financial statements when available; and</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    (10)  Facilities </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">that</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> are not owner-occupied must be leased to meet debt service. The borrower </span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">shall </span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">provide assignments of leases </span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">and </span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">of rent payments to the authority by the date of issuance of any bonds. The terms and conditions of </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">the</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> leasehold estate securing a loan are subject to approval of the authority.</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000001">Source:</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> 13 SDR 134, effective March 31, 1987; 21 SDR 14, effective August 3, 1994</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">; 52 SDR 49, effective November 17, 2025</span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">.</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000001">General Authority:</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> SDCL </span><a href="https://sdlegislature.gov/Statutes?Statute=1-16B-70"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000002">1-16B-70</span></a><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">.</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">    </span><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000001">Law Implemented:</span><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0"> SDCL </span><a href="https://sdlegislature.gov/Statutes?Statute=1-16B-14"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000002">1-16B-14</span></a><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">(7), </span><a href="https://sdlegislature.gov/Statutes?Statute=1-16B-15"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000002">1-16B-15</span></a><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fdC0">, </span><a href="https://sdlegislature.gov/Statutes?Statute=1-16B-18"><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0-000002">1-16B-18</span></a><span class="s388d5b66-9559-4337-9243-7cf1760441fdC0">.</span></p><p dir="ltr" class="s388d5b66-9559-4337-9243-7cf1760441fdP0"><span xml:space="preserve" class="s388d5b66-9559-4337-9243-7cf1760441fd000003"> </span></p></div></body></html>