State Codes and Statutes

Statutes > California > Fin > 22050-22064

FINANCIAL CODE
SECTION 22050-22064



22050.  (a) This division does not apply to any person doing
business under any law of any state or of the United States relating
to banks, trust companies, savings and loan associations, insurance
premium finance agencies, credit unions, small business investment
companies, California business and industrial development
corporations, or licensed pawnbrokers.
   (b) This division does not apply to a check casher who holds a
valid permit issued pursuant to Section 1789.37 of the Civil Code
when acting under the authority of that permit, and shall not apply
to a person holding a valid license issued pursuant to Section 23005
of the Financial Code when acting under the authority of that
license.
   (c) This division does not apply to a college or university making
a loan for the purpose of permitting a person to pursue a program or
course of study leading to a degree or certificate.
   (d) This division does not apply to a broker-dealer acting
pursuant to a certificate then in effect and issued pursuant to
Section 25211 of the Corporations Code.
   (e) This division does not apply to any person who makes no more
than one loan in a 12-month period as long as that loan is a
commercial loan as defined in Section 22502.
   (f) This division does not apply to any public corporation as
defined in Section 67510 of the Government Code, any public entity
other than the state as defined in Section 811.2 of the Government
Code, or any agency of any one or more of the foregoing, when making
any loan so long as the public corporation, public entity, or agency
of any one or more of the foregoing complies with all applicable
federal and state laws and regulations.
   (g) This section shall become operative December 31, 2004.



22051.  This division does not apply to the following:
   (a) Any nonprofit cooperative association organized under Chapter
1 (commencing with Section 54001) of Division 20 of the Food and
Agricultural Code that loans or advances money in connection with any
activity mentioned in that chapter.
   (b) Any corporation, association, syndicate, joint stock company,
or partnership engaged exclusively in the business of marketing
agricultural, horticultural, viticultural, dairy, livestock, poultry,
or bee products on a cooperative nonprofit basis that loans or
advances money to its members or in connection with those businesses.
   (c) Any corporation securing money or credit from any federal
intermediate credit bank organized and existing pursuant to the
provisions of an act of Congress entitled "Agricultural Credits Act
of 1923" that loans or advances money or credit so secured.
   (d) Any corporation created pursuant to the provisions of Part 5
(commencing with Section 14000) of Division 3 of Title 1 of the
Corporations Code.


22052.  This division does not apply to any loan of credit made by a
person not licensed under this division pursuant to a plan having
all of the following characteristics:
   (a) Credit cards issued pursuant to a written application and to
the plan whereby the organization issuing the cards can acquire those
obligations that its members in good standing incur with those
persons with whom the organization has entered into written
agreements setting forth the plan, and where the obligations are
incurred pursuant to those agreements; or whereby the organization
issuing the cards can extend credit to its members.
   (b) The fee for the credit cards is designed to cover the
administrative costs of the plan and is imposed upon the issuance of
the card and on annual renewal dates thereafter.
   (c) Any charges, discounts, or fees resulting from the acquisition
of the charges is paid to the organization issuing the credit cards
by the persons, corporations, or associations with whom the
organization has entered into written agreements.




22053.  In any proceeding under this law, the burden of proving an
exemption is upon the person claiming it.



22054.  This division does not apply to bona fide conditional
contracts of sale involving the disposition of personal property when
these forms of sales agreements are not used for the purpose of
evading this division.


22055.  This division does not apply to premium financing as defined
in Section 18563.



22056.  This division does not apply to the California
Infrastructure and Economic Development Bank, any program authorized
pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of
Division 3 of Title 1 of the Corporations Code, or to the California
Integrated Waste Management Board.



22057.  This division does not apply to any loan that is made or
arranged by any person licensed as a real estate broker by the state
and secured by a lien on real property, or to any licensed real
estate broker when making such a loan. A licensed real estate broker
may make a loan secured by a lien on real property for sale to a
finance lender or arrange for a loan secured by a lien on real
property to be made by a finance lender without obtaining a license
under this division.



22058.  This division does not apply to any cemetery broker licensed
under the Cemetery Act (Chapter 19 (commencing with Section 9600) of
Division 3 of the Business and Professions Code).



22059.  A license to act as a broker under this division does not
authorize the licensee to negotiate or perform any act as a broker in
connection with loans made or to be made by a lender not licensed as
a finance lender under this division.



22060.  This division does not apply to a loan made or arranged by a
licensed residential mortgage lender or servicer when acting under
the authority of that license.



22061.  (a) This division does not apply to any nonprofit church
extension fund.
   (b) For purposes of this section:
   (1) "Nonprofit church extension fund" means a nonprofit
organization affiliated with a church, that is formed for the purpose
of making loans to that church's congregational organization or
organizations for site acquisitions, new facilities, or improvements
to existing facilities, purchased for the benefit of the church
congregational organization.
   (2) What constitutes a "church" shall be determined from the
following criteria, none of which has controlling weight: a distinct
legal existence; a recognized creed and form of worship; a definite
and distinct ecclesiastical government; a formal code of doctrine and
discipline; a distinct religious history; a membership not
associated with any other religion or denomination; a complete
organization of ordained ministers ministering to their
congregations; ordained ministers selected after completing
prescribed courses of study; a literature of its own; established
places of worship; regular congregations; regular religious services;
schools for the religious instruction of youth; and schools for the
preparation of its ministers.
   (3) "Church congregational organization" means a group of
individuals who gather for the purpose of practicing the religion or
manner of worship promulgated by the church with which the
organization is affiliated.
   (4) "Site acquisitions" means purchases of land intended for use
by a church congregational organization.
   (5) "New facilities" means purchases of buildings or structures
intended for use by a church congregational organization.
   (6) "Improvements" means purchases of materials intended to
increase the quality of existing religious sites or facilities.
   (c) For purposes of this section, a nonprofit church extension
fund shall establish that it is exempt from federal taxation pursuant
to Section 501 of Title 26 of the United States Code.
   (d) For purposes of this section, no individual may be held
responsible for the repayment of any loan made by a nonprofit church
extension fund.


22062.  (a) This division does not apply to a commercial bridge loan
made by a venture capital company to an operating company.
   (b) For purposes of this section:
   (1) "Venture capital company" means a person other than an
individual or sole proprietorship that meets all of the following:
   (A) Engages primarily in the business of promoting economic,
business, or industrial development through venture capital
investments or the provision of financial or management assistance to
operating companies.
   (B) At all times maintains at least 50 percent of its assets in
venture capital investments or commitments to make venture capital
investments, and maintains or, assuming consummation of the equity
investment to which the commercial bridge loan relates, will maintain
a material equity interest in the operating company.
   (C) Approves each loan made to an operating company through the
venture capital company's board of directors, executive committee, or
similar policy body, based on a reasonable belief that the loan is
appropriate for the operating company after reasonable inquiry
concerning the operating company's financing objectives and financial
situation.
   (D) Complies, when making the loan, with all applicable federal
and state laws and rules or orders governing securities transactions
including, but not limited to, the Securities Act of 1933, the
Securities Exchange Act of 1934, the Investment Company Act of 1940,
and the Corporate Securities Law of 1968.
   (2) "Operating company" means a person that meets all of the
following:
   (A) Primarily engages, wholly or substantially, directly or
indirectly through a majority owned subsidiary or subsidiaries, in
the production or sale, or the research or development, of a product
or service other than the management or investment of capital. This
shall not include any of the following:
   (i) A person that is either an individual or a sole
proprietorship.
   (ii) A person that has no specific business plan or purpose or has
indicated that its business plan is to engage in a merger or
acquisition with an unidentified company or companies or other entity
or person.
   (B) Uses all of the proceeds of the commercial bridge loan for the
operations of its business.
   (C) Approves each commercial bridge loan through its board of
directors, executive committee, or similar policy board, in the
exercise of its fiduciary duty, based on a reasonable belief that the
loan is appropriate for the operating company after reasonable
inquiry concerning the operating company's financing objectives and
financial situation.
   (3) "Commercial bridge loan" means a loan that meets all of the
following criteria:
   (A) A loan of a principal amount of five thousand dollars ($5,000)
or more, or any loan under an open-end credit program, whether
secured by personal property or unsecured, the proceeds of which are
intended by the operating company for use primarily for other than
personal, family, or household purposes.
   (B) Is made with a maturity date not to exceed one year, and in
connection with or in bona fide contemplation of, an equity
investment in the operating company.
   (C) Is secured, if at all, solely by the operating company's
business assets, exclusive of any real property.
   (D) Is subject to the implied covenant of good faith and fair
dealing under Section 1655 of the Civil Code.
   (4) For purposes of paragraph (1), "venture capital investment" is
an acquisition of securities in an operating company that a person,
an investment adviser of the person, or an affiliated person of
either, has or obtains management rights to.
   (c) For purposes of paragraph (3) of subdivision (b), for the
purposes of determining whether a loan is a commercial bridge loan, a
venture capital company may rely on any written statement of
intended purposes signed by the operating company. The statement may
be a separate statement signed by the operating company or may be
contained in another document signed by the operating company, but in
each case it shall be approved by its board of directors, executive
committee, or similar policy body. The venture capital company may
not be required to ascertain that the proceeds of the loan are used
in accordance with the statement of intended purposes.
   (d) For purposes of subparagraph (A) of paragraph (3) of
subdivision (b), the principles set forth in Section 22551 shall be
used to determine whether the specified amount of a commercial bridge
loan is a bona fide principal amount.
   (e) This section shall apply only to a commercial bridge loan made
by a venture capital company to an operating company on or after
January 1, 2004.
   (f) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury, and conflicts of interest.



22063.  (a) This division does not apply to a franchise loan made by
a franchisor to a franchisee or a subfranchisor or by a
subfranchisor to a franchisee.
   (b) For purposes of this section:
   (1) "Franchise" means "franchise," as defined in Section 31005 of
the Corporations Code.
   (2) "Franchisee" means "franchisee," as defined in Section 31006
of the Corporations Code.
   (3) "Franchisor" means "franchisor," as defined in Section 31007
of the Corporations Code.
   (4) "Area franchise" means "area franchise," as defined in Section
31008 of the Corporations Code.
   (5) "Subfranchise" means "subfranchise," as defined in Section
31008.5 of the Corporations Code.
   (6) "Subfranchisor" means "subfranchisor," as defined in Section
31009 of the Corporations Code.
   (7) "Franchised business" means a business operated pursuant to a
franchise or area franchise by a franchisee or pursuant to a
franchise, area franchise or subfranchise by a subfranchisor.
   (8) "Franchise loan" means a commercial loan, as defined in
Section 22502, made by a franchisor to a current or prospective
franchisee or subfranchisor or a commercial loan by a subfranchisor
to a current or prospective franchisee for the acquisition,
construction, operation, development, equipping, expansion,
contraction, consolidation, merger, recapitalization, reorganization,
or termination of a franchised business provided that the following
conditions are satisfied:
   (A) The franchisor or subfranchisor making the franchise loan
shall comply with all applicable federal and state franchise
disclosure and registration laws, regulations, rules and orders,
including, but not limited to, the California Franchise Investment
Law (Division 5 (commencing with Section 31000) of Title 4 of the
Corporations Code) and the Federal Trade Commission Franchise Rule:
Disclosure Requirements and Prohibitions Concerning Franchising and
Business Opportunity Ventures (Code of Federal Regulations, Title 16,
Chapter 1, Subchapter D, Part 436 (16 CFR 436), as amended) in
connection with the offer or sale of any franchise, area franchise,
or subfranchise to which the franchise loan relates.
   (B) The proceeds of the franchise loan are intended by the
borrowing franchisee or subfranchisor for use primarily for other
than personal, family, or household purposes.
   (C) The loan, if secured, is secured solely by the assets of the
franchised business to which the franchise loan relates. Property
used by the borrower primarily for personal, family, or household
purposes, including the borrower's personal residence, shall not be
taken as security for the loan.
   (D) The loan is subject to the implied covenant of good faith and
fair dealing under Section 1655 of the Civil Code.
   (E) The lender shall fully and clearly disclose to the borrower,
at or before the time the loan is made, the rates of interest,
charges, and costs of the loan.
   (c) For purposes of subparagraph (B) of paragraph (8) of
subdivision (b), a lending franchisor or subfranchisor may rely on
any written statement of intended purposes by the borrowing
franchisee or subfranchisor. The statement may be a separate
statement signed by the borrowing franchisee or subfranchisor or may
be contained in another document signed by the borrowing franchisee
or subfranchisor. The lending franchisor or subfranchisor may not be
required to ascertain that the proceeds of a franchise loan are used
in accordance with the statement of intended purposes.
   (d) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury and conflicts of interest.



22064.  (a) This division does not apply to the following:
   (1) A program-related investment defined in subsection (c) of
Section 4944 of the Internal Revenue Code and United States Treasury
Regulations Section 53.4944-3 that is made by a private foundation,
tax-exempt organization within the meaning of Section 509(a) of the
Internal Revenue Code.
   (2) A loan, guaranty, or investment made by a public charity,
tax-exempt organization within the meaning of paragraph (1), (2), or
(3) of subsection (a) of Section 509 of the Internal Revenue Code
that meets all of the following requirements:
   (A) The primary purpose of the loan, guaranty, or investment is to
accomplish one or more of the exempt purposes of the public charity
making the loan, as described in Section 170(c)(2)(B) of the Internal
Revenue Code.
   (B) Neither the production of income nor the appreciation of
property is a significant purpose of the loan, guaranty, or
investment.
   (C) No purpose of the loan, guaranty, or investment is to
accomplish one or more of the purposes described in Section 170(c)(2)
(D) of the Internal Revenue Code.
   (b) Subdivision (a) shall not exempt from the provisions of this
division a tax-exempt organization that is making consumer loans as
defined in Sections 22203 and 22204.
   (c) A loan that is secured by any assets owned by an individual
shall be exempt under subdivision (a) only if the individual
providing the security is an "accredited investor" as defined in
paragraph (5) or (6) of subsection (a) of Section 230.501 of Title 17
of the Code of Federal Regulations. Property held by an individual
for personal, family, or household purposes, including an individual'
s personal residence, may not be taken as security for a loan.
   (d) A program-related investment by a private foundation, and any
loan, guaranty, or investment made by a public charity that is exempt
under subdivision (a) is subject to the implied covenant of good
faith and fair dealing under Section 1655 of the Civil Code.
   (e) (1) Subdivision (a) shall exempt from the provisions of this
division a program-related investment by a private foundation, or a
loan, guaranty, or investment by a public charity, only if the
following conditions are satisfied:
   (A) The organization making the program-related investment, loan,
guaranty, or investment is exempt from federal income taxes under
Section 501(c)(3) of the Internal Revenue Code and is organized and
operated exclusively for one or more of the purposes described in
Section 501(c)(3) of the Internal Revenue Code.
   (B) No part of the net earnings of the organization making the
program-related investment, loan, guaranty or investment inures to
the benefit of a private shareholder or individual.
   (C) No broker's fee will be paid in connection with the making of
the program-related investment, loan, guaranty, or investment or
placement of the program-related investment, loan, guaranty or
investment.
   (2) This subdivision does not prohibit the organization making the
program-related investment, loan, guaranty, or investment from
charging interest on the loan or investment or fees on the guaranty.
   (f) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity that is made for
the primary purpose of accomplishing one or more of the organization'
s exempt purposes described in Section 501(c)(3) of the Internal
Revenue Code, and no significant purpose of which is the production
of income or the appreciation of property within the meaning of
subsection (c) of Section 4944 of the Internal Revenue Code. A
recipient shall be required to use all funds received from the
private foundation or the public charity only for the charitable
purposes for which the program-related investment, loan, guaranty, or
investment was made.
   (g) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity if the organization
consummates not more than 35 loans in a calendar year. In the making
and negotiating of these loans, the private foundation or public
charity shall take into consideration the financial ability of the
recipients to repay the loans in the time and manner provided.
   (h) Nothing in this section is intended to abrogate or diminish
the application of any other applicable laws that are designed to
govern the tax-exempt organizations described in subdivision (a),
including, but not limited to, laws pertaining to recordkeeping and
reporting to the Attorney General and the Internal Revenue Service or
to protect borrowers, including, but not limited to, laws pertaining
to licenses, unfair competition, usury, and conflicts of interest.


State Codes and Statutes

Statutes > California > Fin > 22050-22064

FINANCIAL CODE
SECTION 22050-22064



22050.  (a) This division does not apply to any person doing
business under any law of any state or of the United States relating
to banks, trust companies, savings and loan associations, insurance
premium finance agencies, credit unions, small business investment
companies, California business and industrial development
corporations, or licensed pawnbrokers.
   (b) This division does not apply to a check casher who holds a
valid permit issued pursuant to Section 1789.37 of the Civil Code
when acting under the authority of that permit, and shall not apply
to a person holding a valid license issued pursuant to Section 23005
of the Financial Code when acting under the authority of that
license.
   (c) This division does not apply to a college or university making
a loan for the purpose of permitting a person to pursue a program or
course of study leading to a degree or certificate.
   (d) This division does not apply to a broker-dealer acting
pursuant to a certificate then in effect and issued pursuant to
Section 25211 of the Corporations Code.
   (e) This division does not apply to any person who makes no more
than one loan in a 12-month period as long as that loan is a
commercial loan as defined in Section 22502.
   (f) This division does not apply to any public corporation as
defined in Section 67510 of the Government Code, any public entity
other than the state as defined in Section 811.2 of the Government
Code, or any agency of any one or more of the foregoing, when making
any loan so long as the public corporation, public entity, or agency
of any one or more of the foregoing complies with all applicable
federal and state laws and regulations.
   (g) This section shall become operative December 31, 2004.



22051.  This division does not apply to the following:
   (a) Any nonprofit cooperative association organized under Chapter
1 (commencing with Section 54001) of Division 20 of the Food and
Agricultural Code that loans or advances money in connection with any
activity mentioned in that chapter.
   (b) Any corporation, association, syndicate, joint stock company,
or partnership engaged exclusively in the business of marketing
agricultural, horticultural, viticultural, dairy, livestock, poultry,
or bee products on a cooperative nonprofit basis that loans or
advances money to its members or in connection with those businesses.
   (c) Any corporation securing money or credit from any federal
intermediate credit bank organized and existing pursuant to the
provisions of an act of Congress entitled "Agricultural Credits Act
of 1923" that loans or advances money or credit so secured.
   (d) Any corporation created pursuant to the provisions of Part 5
(commencing with Section 14000) of Division 3 of Title 1 of the
Corporations Code.


22052.  This division does not apply to any loan of credit made by a
person not licensed under this division pursuant to a plan having
all of the following characteristics:
   (a) Credit cards issued pursuant to a written application and to
the plan whereby the organization issuing the cards can acquire those
obligations that its members in good standing incur with those
persons with whom the organization has entered into written
agreements setting forth the plan, and where the obligations are
incurred pursuant to those agreements; or whereby the organization
issuing the cards can extend credit to its members.
   (b) The fee for the credit cards is designed to cover the
administrative costs of the plan and is imposed upon the issuance of
the card and on annual renewal dates thereafter.
   (c) Any charges, discounts, or fees resulting from the acquisition
of the charges is paid to the organization issuing the credit cards
by the persons, corporations, or associations with whom the
organization has entered into written agreements.




22053.  In any proceeding under this law, the burden of proving an
exemption is upon the person claiming it.



22054.  This division does not apply to bona fide conditional
contracts of sale involving the disposition of personal property when
these forms of sales agreements are not used for the purpose of
evading this division.


22055.  This division does not apply to premium financing as defined
in Section 18563.



22056.  This division does not apply to the California
Infrastructure and Economic Development Bank, any program authorized
pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of
Division 3 of Title 1 of the Corporations Code, or to the California
Integrated Waste Management Board.



22057.  This division does not apply to any loan that is made or
arranged by any person licensed as a real estate broker by the state
and secured by a lien on real property, or to any licensed real
estate broker when making such a loan. A licensed real estate broker
may make a loan secured by a lien on real property for sale to a
finance lender or arrange for a loan secured by a lien on real
property to be made by a finance lender without obtaining a license
under this division.



22058.  This division does not apply to any cemetery broker licensed
under the Cemetery Act (Chapter 19 (commencing with Section 9600) of
Division 3 of the Business and Professions Code).



22059.  A license to act as a broker under this division does not
authorize the licensee to negotiate or perform any act as a broker in
connection with loans made or to be made by a lender not licensed as
a finance lender under this division.



22060.  This division does not apply to a loan made or arranged by a
licensed residential mortgage lender or servicer when acting under
the authority of that license.



22061.  (a) This division does not apply to any nonprofit church
extension fund.
   (b) For purposes of this section:
   (1) "Nonprofit church extension fund" means a nonprofit
organization affiliated with a church, that is formed for the purpose
of making loans to that church's congregational organization or
organizations for site acquisitions, new facilities, or improvements
to existing facilities, purchased for the benefit of the church
congregational organization.
   (2) What constitutes a "church" shall be determined from the
following criteria, none of which has controlling weight: a distinct
legal existence; a recognized creed and form of worship; a definite
and distinct ecclesiastical government; a formal code of doctrine and
discipline; a distinct religious history; a membership not
associated with any other religion or denomination; a complete
organization of ordained ministers ministering to their
congregations; ordained ministers selected after completing
prescribed courses of study; a literature of its own; established
places of worship; regular congregations; regular religious services;
schools for the religious instruction of youth; and schools for the
preparation of its ministers.
   (3) "Church congregational organization" means a group of
individuals who gather for the purpose of practicing the religion or
manner of worship promulgated by the church with which the
organization is affiliated.
   (4) "Site acquisitions" means purchases of land intended for use
by a church congregational organization.
   (5) "New facilities" means purchases of buildings or structures
intended for use by a church congregational organization.
   (6) "Improvements" means purchases of materials intended to
increase the quality of existing religious sites or facilities.
   (c) For purposes of this section, a nonprofit church extension
fund shall establish that it is exempt from federal taxation pursuant
to Section 501 of Title 26 of the United States Code.
   (d) For purposes of this section, no individual may be held
responsible for the repayment of any loan made by a nonprofit church
extension fund.


22062.  (a) This division does not apply to a commercial bridge loan
made by a venture capital company to an operating company.
   (b) For purposes of this section:
   (1) "Venture capital company" means a person other than an
individual or sole proprietorship that meets all of the following:
   (A) Engages primarily in the business of promoting economic,
business, or industrial development through venture capital
investments or the provision of financial or management assistance to
operating companies.
   (B) At all times maintains at least 50 percent of its assets in
venture capital investments or commitments to make venture capital
investments, and maintains or, assuming consummation of the equity
investment to which the commercial bridge loan relates, will maintain
a material equity interest in the operating company.
   (C) Approves each loan made to an operating company through the
venture capital company's board of directors, executive committee, or
similar policy body, based on a reasonable belief that the loan is
appropriate for the operating company after reasonable inquiry
concerning the operating company's financing objectives and financial
situation.
   (D) Complies, when making the loan, with all applicable federal
and state laws and rules or orders governing securities transactions
including, but not limited to, the Securities Act of 1933, the
Securities Exchange Act of 1934, the Investment Company Act of 1940,
and the Corporate Securities Law of 1968.
   (2) "Operating company" means a person that meets all of the
following:
   (A) Primarily engages, wholly or substantially, directly or
indirectly through a majority owned subsidiary or subsidiaries, in
the production or sale, or the research or development, of a product
or service other than the management or investment of capital. This
shall not include any of the following:
   (i) A person that is either an individual or a sole
proprietorship.
   (ii) A person that has no specific business plan or purpose or has
indicated that its business plan is to engage in a merger or
acquisition with an unidentified company or companies or other entity
or person.
   (B) Uses all of the proceeds of the commercial bridge loan for the
operations of its business.
   (C) Approves each commercial bridge loan through its board of
directors, executive committee, or similar policy board, in the
exercise of its fiduciary duty, based on a reasonable belief that the
loan is appropriate for the operating company after reasonable
inquiry concerning the operating company's financing objectives and
financial situation.
   (3) "Commercial bridge loan" means a loan that meets all of the
following criteria:
   (A) A loan of a principal amount of five thousand dollars ($5,000)
or more, or any loan under an open-end credit program, whether
secured by personal property or unsecured, the proceeds of which are
intended by the operating company for use primarily for other than
personal, family, or household purposes.
   (B) Is made with a maturity date not to exceed one year, and in
connection with or in bona fide contemplation of, an equity
investment in the operating company.
   (C) Is secured, if at all, solely by the operating company's
business assets, exclusive of any real property.
   (D) Is subject to the implied covenant of good faith and fair
dealing under Section 1655 of the Civil Code.
   (4) For purposes of paragraph (1), "venture capital investment" is
an acquisition of securities in an operating company that a person,
an investment adviser of the person, or an affiliated person of
either, has or obtains management rights to.
   (c) For purposes of paragraph (3) of subdivision (b), for the
purposes of determining whether a loan is a commercial bridge loan, a
venture capital company may rely on any written statement of
intended purposes signed by the operating company. The statement may
be a separate statement signed by the operating company or may be
contained in another document signed by the operating company, but in
each case it shall be approved by its board of directors, executive
committee, or similar policy body. The venture capital company may
not be required to ascertain that the proceeds of the loan are used
in accordance with the statement of intended purposes.
   (d) For purposes of subparagraph (A) of paragraph (3) of
subdivision (b), the principles set forth in Section 22551 shall be
used to determine whether the specified amount of a commercial bridge
loan is a bona fide principal amount.
   (e) This section shall apply only to a commercial bridge loan made
by a venture capital company to an operating company on or after
January 1, 2004.
   (f) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury, and conflicts of interest.



22063.  (a) This division does not apply to a franchise loan made by
a franchisor to a franchisee or a subfranchisor or by a
subfranchisor to a franchisee.
   (b) For purposes of this section:
   (1) "Franchise" means "franchise," as defined in Section 31005 of
the Corporations Code.
   (2) "Franchisee" means "franchisee," as defined in Section 31006
of the Corporations Code.
   (3) "Franchisor" means "franchisor," as defined in Section 31007
of the Corporations Code.
   (4) "Area franchise" means "area franchise," as defined in Section
31008 of the Corporations Code.
   (5) "Subfranchise" means "subfranchise," as defined in Section
31008.5 of the Corporations Code.
   (6) "Subfranchisor" means "subfranchisor," as defined in Section
31009 of the Corporations Code.
   (7) "Franchised business" means a business operated pursuant to a
franchise or area franchise by a franchisee or pursuant to a
franchise, area franchise or subfranchise by a subfranchisor.
   (8) "Franchise loan" means a commercial loan, as defined in
Section 22502, made by a franchisor to a current or prospective
franchisee or subfranchisor or a commercial loan by a subfranchisor
to a current or prospective franchisee for the acquisition,
construction, operation, development, equipping, expansion,
contraction, consolidation, merger, recapitalization, reorganization,
or termination of a franchised business provided that the following
conditions are satisfied:
   (A) The franchisor or subfranchisor making the franchise loan
shall comply with all applicable federal and state franchise
disclosure and registration laws, regulations, rules and orders,
including, but not limited to, the California Franchise Investment
Law (Division 5 (commencing with Section 31000) of Title 4 of the
Corporations Code) and the Federal Trade Commission Franchise Rule:
Disclosure Requirements and Prohibitions Concerning Franchising and
Business Opportunity Ventures (Code of Federal Regulations, Title 16,
Chapter 1, Subchapter D, Part 436 (16 CFR 436), as amended) in
connection with the offer or sale of any franchise, area franchise,
or subfranchise to which the franchise loan relates.
   (B) The proceeds of the franchise loan are intended by the
borrowing franchisee or subfranchisor for use primarily for other
than personal, family, or household purposes.
   (C) The loan, if secured, is secured solely by the assets of the
franchised business to which the franchise loan relates. Property
used by the borrower primarily for personal, family, or household
purposes, including the borrower's personal residence, shall not be
taken as security for the loan.
   (D) The loan is subject to the implied covenant of good faith and
fair dealing under Section 1655 of the Civil Code.
   (E) The lender shall fully and clearly disclose to the borrower,
at or before the time the loan is made, the rates of interest,
charges, and costs of the loan.
   (c) For purposes of subparagraph (B) of paragraph (8) of
subdivision (b), a lending franchisor or subfranchisor may rely on
any written statement of intended purposes by the borrowing
franchisee or subfranchisor. The statement may be a separate
statement signed by the borrowing franchisee or subfranchisor or may
be contained in another document signed by the borrowing franchisee
or subfranchisor. The lending franchisor or subfranchisor may not be
required to ascertain that the proceeds of a franchise loan are used
in accordance with the statement of intended purposes.
   (d) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury and conflicts of interest.



22064.  (a) This division does not apply to the following:
   (1) A program-related investment defined in subsection (c) of
Section 4944 of the Internal Revenue Code and United States Treasury
Regulations Section 53.4944-3 that is made by a private foundation,
tax-exempt organization within the meaning of Section 509(a) of the
Internal Revenue Code.
   (2) A loan, guaranty, or investment made by a public charity,
tax-exempt organization within the meaning of paragraph (1), (2), or
(3) of subsection (a) of Section 509 of the Internal Revenue Code
that meets all of the following requirements:
   (A) The primary purpose of the loan, guaranty, or investment is to
accomplish one or more of the exempt purposes of the public charity
making the loan, as described in Section 170(c)(2)(B) of the Internal
Revenue Code.
   (B) Neither the production of income nor the appreciation of
property is a significant purpose of the loan, guaranty, or
investment.
   (C) No purpose of the loan, guaranty, or investment is to
accomplish one or more of the purposes described in Section 170(c)(2)
(D) of the Internal Revenue Code.
   (b) Subdivision (a) shall not exempt from the provisions of this
division a tax-exempt organization that is making consumer loans as
defined in Sections 22203 and 22204.
   (c) A loan that is secured by any assets owned by an individual
shall be exempt under subdivision (a) only if the individual
providing the security is an "accredited investor" as defined in
paragraph (5) or (6) of subsection (a) of Section 230.501 of Title 17
of the Code of Federal Regulations. Property held by an individual
for personal, family, or household purposes, including an individual'
s personal residence, may not be taken as security for a loan.
   (d) A program-related investment by a private foundation, and any
loan, guaranty, or investment made by a public charity that is exempt
under subdivision (a) is subject to the implied covenant of good
faith and fair dealing under Section 1655 of the Civil Code.
   (e) (1) Subdivision (a) shall exempt from the provisions of this
division a program-related investment by a private foundation, or a
loan, guaranty, or investment by a public charity, only if the
following conditions are satisfied:
   (A) The organization making the program-related investment, loan,
guaranty, or investment is exempt from federal income taxes under
Section 501(c)(3) of the Internal Revenue Code and is organized and
operated exclusively for one or more of the purposes described in
Section 501(c)(3) of the Internal Revenue Code.
   (B) No part of the net earnings of the organization making the
program-related investment, loan, guaranty or investment inures to
the benefit of a private shareholder or individual.
   (C) No broker's fee will be paid in connection with the making of
the program-related investment, loan, guaranty, or investment or
placement of the program-related investment, loan, guaranty or
investment.
   (2) This subdivision does not prohibit the organization making the
program-related investment, loan, guaranty, or investment from
charging interest on the loan or investment or fees on the guaranty.
   (f) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity that is made for
the primary purpose of accomplishing one or more of the organization'
s exempt purposes described in Section 501(c)(3) of the Internal
Revenue Code, and no significant purpose of which is the production
of income or the appreciation of property within the meaning of
subsection (c) of Section 4944 of the Internal Revenue Code. A
recipient shall be required to use all funds received from the
private foundation or the public charity only for the charitable
purposes for which the program-related investment, loan, guaranty, or
investment was made.
   (g) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity if the organization
consummates not more than 35 loans in a calendar year. In the making
and negotiating of these loans, the private foundation or public
charity shall take into consideration the financial ability of the
recipients to repay the loans in the time and manner provided.
   (h) Nothing in this section is intended to abrogate or diminish
the application of any other applicable laws that are designed to
govern the tax-exempt organizations described in subdivision (a),
including, but not limited to, laws pertaining to recordkeeping and
reporting to the Attorney General and the Internal Revenue Service or
to protect borrowers, including, but not limited to, laws pertaining
to licenses, unfair competition, usury, and conflicts of interest.



State Codes and Statutes

State Codes and Statutes

Statutes > California > Fin > 22050-22064

FINANCIAL CODE
SECTION 22050-22064



22050.  (a) This division does not apply to any person doing
business under any law of any state or of the United States relating
to banks, trust companies, savings and loan associations, insurance
premium finance agencies, credit unions, small business investment
companies, California business and industrial development
corporations, or licensed pawnbrokers.
   (b) This division does not apply to a check casher who holds a
valid permit issued pursuant to Section 1789.37 of the Civil Code
when acting under the authority of that permit, and shall not apply
to a person holding a valid license issued pursuant to Section 23005
of the Financial Code when acting under the authority of that
license.
   (c) This division does not apply to a college or university making
a loan for the purpose of permitting a person to pursue a program or
course of study leading to a degree or certificate.
   (d) This division does not apply to a broker-dealer acting
pursuant to a certificate then in effect and issued pursuant to
Section 25211 of the Corporations Code.
   (e) This division does not apply to any person who makes no more
than one loan in a 12-month period as long as that loan is a
commercial loan as defined in Section 22502.
   (f) This division does not apply to any public corporation as
defined in Section 67510 of the Government Code, any public entity
other than the state as defined in Section 811.2 of the Government
Code, or any agency of any one or more of the foregoing, when making
any loan so long as the public corporation, public entity, or agency
of any one or more of the foregoing complies with all applicable
federal and state laws and regulations.
   (g) This section shall become operative December 31, 2004.



22051.  This division does not apply to the following:
   (a) Any nonprofit cooperative association organized under Chapter
1 (commencing with Section 54001) of Division 20 of the Food and
Agricultural Code that loans or advances money in connection with any
activity mentioned in that chapter.
   (b) Any corporation, association, syndicate, joint stock company,
or partnership engaged exclusively in the business of marketing
agricultural, horticultural, viticultural, dairy, livestock, poultry,
or bee products on a cooperative nonprofit basis that loans or
advances money to its members or in connection with those businesses.
   (c) Any corporation securing money or credit from any federal
intermediate credit bank organized and existing pursuant to the
provisions of an act of Congress entitled "Agricultural Credits Act
of 1923" that loans or advances money or credit so secured.
   (d) Any corporation created pursuant to the provisions of Part 5
(commencing with Section 14000) of Division 3 of Title 1 of the
Corporations Code.


22052.  This division does not apply to any loan of credit made by a
person not licensed under this division pursuant to a plan having
all of the following characteristics:
   (a) Credit cards issued pursuant to a written application and to
the plan whereby the organization issuing the cards can acquire those
obligations that its members in good standing incur with those
persons with whom the organization has entered into written
agreements setting forth the plan, and where the obligations are
incurred pursuant to those agreements; or whereby the organization
issuing the cards can extend credit to its members.
   (b) The fee for the credit cards is designed to cover the
administrative costs of the plan and is imposed upon the issuance of
the card and on annual renewal dates thereafter.
   (c) Any charges, discounts, or fees resulting from the acquisition
of the charges is paid to the organization issuing the credit cards
by the persons, corporations, or associations with whom the
organization has entered into written agreements.




22053.  In any proceeding under this law, the burden of proving an
exemption is upon the person claiming it.



22054.  This division does not apply to bona fide conditional
contracts of sale involving the disposition of personal property when
these forms of sales agreements are not used for the purpose of
evading this division.


22055.  This division does not apply to premium financing as defined
in Section 18563.



22056.  This division does not apply to the California
Infrastructure and Economic Development Bank, any program authorized
pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of
Division 3 of Title 1 of the Corporations Code, or to the California
Integrated Waste Management Board.



22057.  This division does not apply to any loan that is made or
arranged by any person licensed as a real estate broker by the state
and secured by a lien on real property, or to any licensed real
estate broker when making such a loan. A licensed real estate broker
may make a loan secured by a lien on real property for sale to a
finance lender or arrange for a loan secured by a lien on real
property to be made by a finance lender without obtaining a license
under this division.



22058.  This division does not apply to any cemetery broker licensed
under the Cemetery Act (Chapter 19 (commencing with Section 9600) of
Division 3 of the Business and Professions Code).



22059.  A license to act as a broker under this division does not
authorize the licensee to negotiate or perform any act as a broker in
connection with loans made or to be made by a lender not licensed as
a finance lender under this division.



22060.  This division does not apply to a loan made or arranged by a
licensed residential mortgage lender or servicer when acting under
the authority of that license.



22061.  (a) This division does not apply to any nonprofit church
extension fund.
   (b) For purposes of this section:
   (1) "Nonprofit church extension fund" means a nonprofit
organization affiliated with a church, that is formed for the purpose
of making loans to that church's congregational organization or
organizations for site acquisitions, new facilities, or improvements
to existing facilities, purchased for the benefit of the church
congregational organization.
   (2) What constitutes a "church" shall be determined from the
following criteria, none of which has controlling weight: a distinct
legal existence; a recognized creed and form of worship; a definite
and distinct ecclesiastical government; a formal code of doctrine and
discipline; a distinct religious history; a membership not
associated with any other religion or denomination; a complete
organization of ordained ministers ministering to their
congregations; ordained ministers selected after completing
prescribed courses of study; a literature of its own; established
places of worship; regular congregations; regular religious services;
schools for the religious instruction of youth; and schools for the
preparation of its ministers.
   (3) "Church congregational organization" means a group of
individuals who gather for the purpose of practicing the religion or
manner of worship promulgated by the church with which the
organization is affiliated.
   (4) "Site acquisitions" means purchases of land intended for use
by a church congregational organization.
   (5) "New facilities" means purchases of buildings or structures
intended for use by a church congregational organization.
   (6) "Improvements" means purchases of materials intended to
increase the quality of existing religious sites or facilities.
   (c) For purposes of this section, a nonprofit church extension
fund shall establish that it is exempt from federal taxation pursuant
to Section 501 of Title 26 of the United States Code.
   (d) For purposes of this section, no individual may be held
responsible for the repayment of any loan made by a nonprofit church
extension fund.


22062.  (a) This division does not apply to a commercial bridge loan
made by a venture capital company to an operating company.
   (b) For purposes of this section:
   (1) "Venture capital company" means a person other than an
individual or sole proprietorship that meets all of the following:
   (A) Engages primarily in the business of promoting economic,
business, or industrial development through venture capital
investments or the provision of financial or management assistance to
operating companies.
   (B) At all times maintains at least 50 percent of its assets in
venture capital investments or commitments to make venture capital
investments, and maintains or, assuming consummation of the equity
investment to which the commercial bridge loan relates, will maintain
a material equity interest in the operating company.
   (C) Approves each loan made to an operating company through the
venture capital company's board of directors, executive committee, or
similar policy body, based on a reasonable belief that the loan is
appropriate for the operating company after reasonable inquiry
concerning the operating company's financing objectives and financial
situation.
   (D) Complies, when making the loan, with all applicable federal
and state laws and rules or orders governing securities transactions
including, but not limited to, the Securities Act of 1933, the
Securities Exchange Act of 1934, the Investment Company Act of 1940,
and the Corporate Securities Law of 1968.
   (2) "Operating company" means a person that meets all of the
following:
   (A) Primarily engages, wholly or substantially, directly or
indirectly through a majority owned subsidiary or subsidiaries, in
the production or sale, or the research or development, of a product
or service other than the management or investment of capital. This
shall not include any of the following:
   (i) A person that is either an individual or a sole
proprietorship.
   (ii) A person that has no specific business plan or purpose or has
indicated that its business plan is to engage in a merger or
acquisition with an unidentified company or companies or other entity
or person.
   (B) Uses all of the proceeds of the commercial bridge loan for the
operations of its business.
   (C) Approves each commercial bridge loan through its board of
directors, executive committee, or similar policy board, in the
exercise of its fiduciary duty, based on a reasonable belief that the
loan is appropriate for the operating company after reasonable
inquiry concerning the operating company's financing objectives and
financial situation.
   (3) "Commercial bridge loan" means a loan that meets all of the
following criteria:
   (A) A loan of a principal amount of five thousand dollars ($5,000)
or more, or any loan under an open-end credit program, whether
secured by personal property or unsecured, the proceeds of which are
intended by the operating company for use primarily for other than
personal, family, or household purposes.
   (B) Is made with a maturity date not to exceed one year, and in
connection with or in bona fide contemplation of, an equity
investment in the operating company.
   (C) Is secured, if at all, solely by the operating company's
business assets, exclusive of any real property.
   (D) Is subject to the implied covenant of good faith and fair
dealing under Section 1655 of the Civil Code.
   (4) For purposes of paragraph (1), "venture capital investment" is
an acquisition of securities in an operating company that a person,
an investment adviser of the person, or an affiliated person of
either, has or obtains management rights to.
   (c) For purposes of paragraph (3) of subdivision (b), for the
purposes of determining whether a loan is a commercial bridge loan, a
venture capital company may rely on any written statement of
intended purposes signed by the operating company. The statement may
be a separate statement signed by the operating company or may be
contained in another document signed by the operating company, but in
each case it shall be approved by its board of directors, executive
committee, or similar policy body. The venture capital company may
not be required to ascertain that the proceeds of the loan are used
in accordance with the statement of intended purposes.
   (d) For purposes of subparagraph (A) of paragraph (3) of
subdivision (b), the principles set forth in Section 22551 shall be
used to determine whether the specified amount of a commercial bridge
loan is a bona fide principal amount.
   (e) This section shall apply only to a commercial bridge loan made
by a venture capital company to an operating company on or after
January 1, 2004.
   (f) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury, and conflicts of interest.



22063.  (a) This division does not apply to a franchise loan made by
a franchisor to a franchisee or a subfranchisor or by a
subfranchisor to a franchisee.
   (b) For purposes of this section:
   (1) "Franchise" means "franchise," as defined in Section 31005 of
the Corporations Code.
   (2) "Franchisee" means "franchisee," as defined in Section 31006
of the Corporations Code.
   (3) "Franchisor" means "franchisor," as defined in Section 31007
of the Corporations Code.
   (4) "Area franchise" means "area franchise," as defined in Section
31008 of the Corporations Code.
   (5) "Subfranchise" means "subfranchise," as defined in Section
31008.5 of the Corporations Code.
   (6) "Subfranchisor" means "subfranchisor," as defined in Section
31009 of the Corporations Code.
   (7) "Franchised business" means a business operated pursuant to a
franchise or area franchise by a franchisee or pursuant to a
franchise, area franchise or subfranchise by a subfranchisor.
   (8) "Franchise loan" means a commercial loan, as defined in
Section 22502, made by a franchisor to a current or prospective
franchisee or subfranchisor or a commercial loan by a subfranchisor
to a current or prospective franchisee for the acquisition,
construction, operation, development, equipping, expansion,
contraction, consolidation, merger, recapitalization, reorganization,
or termination of a franchised business provided that the following
conditions are satisfied:
   (A) The franchisor or subfranchisor making the franchise loan
shall comply with all applicable federal and state franchise
disclosure and registration laws, regulations, rules and orders,
including, but not limited to, the California Franchise Investment
Law (Division 5 (commencing with Section 31000) of Title 4 of the
Corporations Code) and the Federal Trade Commission Franchise Rule:
Disclosure Requirements and Prohibitions Concerning Franchising and
Business Opportunity Ventures (Code of Federal Regulations, Title 16,
Chapter 1, Subchapter D, Part 436 (16 CFR 436), as amended) in
connection with the offer or sale of any franchise, area franchise,
or subfranchise to which the franchise loan relates.
   (B) The proceeds of the franchise loan are intended by the
borrowing franchisee or subfranchisor for use primarily for other
than personal, family, or household purposes.
   (C) The loan, if secured, is secured solely by the assets of the
franchised business to which the franchise loan relates. Property
used by the borrower primarily for personal, family, or household
purposes, including the borrower's personal residence, shall not be
taken as security for the loan.
   (D) The loan is subject to the implied covenant of good faith and
fair dealing under Section 1655 of the Civil Code.
   (E) The lender shall fully and clearly disclose to the borrower,
at or before the time the loan is made, the rates of interest,
charges, and costs of the loan.
   (c) For purposes of subparagraph (B) of paragraph (8) of
subdivision (b), a lending franchisor or subfranchisor may rely on
any written statement of intended purposes by the borrowing
franchisee or subfranchisor. The statement may be a separate
statement signed by the borrowing franchisee or subfranchisor or may
be contained in another document signed by the borrowing franchisee
or subfranchisor. The lending franchisor or subfranchisor may not be
required to ascertain that the proceeds of a franchise loan are used
in accordance with the statement of intended purposes.
   (d) Nothing in this section is intended to abrogate or diminish
the application of any other laws that are designed to protect
borrowers, including, but not limited to, laws pertaining to
licensing, unfair competition, usury and conflicts of interest.



22064.  (a) This division does not apply to the following:
   (1) A program-related investment defined in subsection (c) of
Section 4944 of the Internal Revenue Code and United States Treasury
Regulations Section 53.4944-3 that is made by a private foundation,
tax-exempt organization within the meaning of Section 509(a) of the
Internal Revenue Code.
   (2) A loan, guaranty, or investment made by a public charity,
tax-exempt organization within the meaning of paragraph (1), (2), or
(3) of subsection (a) of Section 509 of the Internal Revenue Code
that meets all of the following requirements:
   (A) The primary purpose of the loan, guaranty, or investment is to
accomplish one or more of the exempt purposes of the public charity
making the loan, as described in Section 170(c)(2)(B) of the Internal
Revenue Code.
   (B) Neither the production of income nor the appreciation of
property is a significant purpose of the loan, guaranty, or
investment.
   (C) No purpose of the loan, guaranty, or investment is to
accomplish one or more of the purposes described in Section 170(c)(2)
(D) of the Internal Revenue Code.
   (b) Subdivision (a) shall not exempt from the provisions of this
division a tax-exempt organization that is making consumer loans as
defined in Sections 22203 and 22204.
   (c) A loan that is secured by any assets owned by an individual
shall be exempt under subdivision (a) only if the individual
providing the security is an "accredited investor" as defined in
paragraph (5) or (6) of subsection (a) of Section 230.501 of Title 17
of the Code of Federal Regulations. Property held by an individual
for personal, family, or household purposes, including an individual'
s personal residence, may not be taken as security for a loan.
   (d) A program-related investment by a private foundation, and any
loan, guaranty, or investment made by a public charity that is exempt
under subdivision (a) is subject to the implied covenant of good
faith and fair dealing under Section 1655 of the Civil Code.
   (e) (1) Subdivision (a) shall exempt from the provisions of this
division a program-related investment by a private foundation, or a
loan, guaranty, or investment by a public charity, only if the
following conditions are satisfied:
   (A) The organization making the program-related investment, loan,
guaranty, or investment is exempt from federal income taxes under
Section 501(c)(3) of the Internal Revenue Code and is organized and
operated exclusively for one or more of the purposes described in
Section 501(c)(3) of the Internal Revenue Code.
   (B) No part of the net earnings of the organization making the
program-related investment, loan, guaranty or investment inures to
the benefit of a private shareholder or individual.
   (C) No broker's fee will be paid in connection with the making of
the program-related investment, loan, guaranty, or investment or
placement of the program-related investment, loan, guaranty or
investment.
   (2) This subdivision does not prohibit the organization making the
program-related investment, loan, guaranty, or investment from
charging interest on the loan or investment or fees on the guaranty.
   (f) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity that is made for
the primary purpose of accomplishing one or more of the organization'
s exempt purposes described in Section 501(c)(3) of the Internal
Revenue Code, and no significant purpose of which is the production
of income or the appreciation of property within the meaning of
subsection (c) of Section 4944 of the Internal Revenue Code. A
recipient shall be required to use all funds received from the
private foundation or the public charity only for the charitable
purposes for which the program-related investment, loan, guaranty, or
investment was made.
   (g) Subdivision (a) shall only exempt from the provisions of this
division a program-related investment by a private foundation or a
loan, guaranty, or investment by a public charity if the organization
consummates not more than 35 loans in a calendar year. In the making
and negotiating of these loans, the private foundation or public
charity shall take into consideration the financial ability of the
recipients to repay the loans in the time and manner provided.
   (h) Nothing in this section is intended to abrogate or diminish
the application of any other applicable laws that are designed to
govern the tax-exempt organizations described in subdivision (a),
including, but not limited to, laws pertaining to recordkeeping and
reporting to the Attorney General and the Internal Revenue Service or
to protect borrowers, including, but not limited to, laws pertaining
to licenses, unfair competition, usury, and conflicts of interest.


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