<br><br> <br>Page 1 of 2 <br>41.610 Participation in program -- Investment agreements -- Required terms and <br>conditions. <br>(1) Qualified public depositories in Kentucky shall be eligible to participate in the <br>Linked Deposit Investment Program. <br>(2) An eligible lending institution choosing to participate in the Linked Deposit <br>Investment Program shall enter into a linked deposit investment agreement with the <br>State Investment Commission which shall include requirements necessary to carry <br>out the purposes of the Linked Deposit Investment Program. A linked investment <br>shall bear a minimum rate of two percent (2%) and a maximum rate fixed by the <br>Wall Street Journal prime rate as published on the first business day of each month <br>less four percent (4%). <br>(3) The eligible lending institution that desires to receive a linked deposit investment <br>shall agree to loan the funds to borrowers under the following terms: <br>(a) No loan shall exceed one hundred thousand dollars ($100,000); <br>(b) Maturity dates of the loan shall be set as agreed to between the financial <br>institution and the borrower with a maximum maturity of seven (7) years; and <br>(c) The rate of interest for the term of the loan shall be fixed at the Wall Street <br>Journal prime rate as published on the first business day of each month, with a <br>minimum interest rate of five percent (5%). <br>(4) An eligible lending institution that desires to receive a linked deposit shall accept <br>and review applications for loans from eligible small businesses and agribusinesses. <br>The lending institution shall assume all responsibility for credit underwriting and <br>shall apply all usual lending standards to determine the creditworthiness of each <br>applicant. <br>(5) The eligible lending institution shall forward to the Kentucky Agricultural Finance <br>Corporation or the Cabinet for Economic Development, as appropriate, a completed <br>loan package for review to determine if the loan package is in accordance with the <br>administrative regulations promulgated pursuant to KRS 41.606(7). If the loan <br>package is found to be complete and in accordance with the administrative <br>regulations, it shall be forwarded to the State Investment Commission for funding. <br>(6) The eligible lending institution shall charge no penalty for early payback of the <br>linked deposit loan. Principal repayments received by the lending institution shall <br>be returned to the State Investment Commission annually on the anniversary date of <br>the loan. <br>(7) Applications for renewal of repurchase agreements shall be accompanied by a status <br>report on linked deposit loans. <br>(8) The Commonwealth, the Kentucky Agricultural Finance Corporation, and the <br>Cabinet for Economic Development, their agents and employees, and the State <br>Investment Commission shall not be liable to any eligible lending institution in any <br>manner for payment of the principal or interest on the loan to an eligible small <br>business or to an eligible small agribusiness. Any delay in payments or default on <br>the part of a borrower shall not affect the deposit agreement between the eligible <br>lending institution and the State. <br><br> <br>Page 2 of 2 <br>Effective: July 13, 2004 <br>History: Amended 2004 Ky. Acts ch. 41, sec. 3, effective July 13, 2004. -- Amended <br>1998 Ky. Acts ch. 172, sec. 2, effective July 15, 1998. -- Amended 1996 Ky. Acts <br>ch. 208, sec. 6, effective July 15, 1996. -- Created 1994 Ky. Acts ch. 276, sec. 3, <br>effective July 15, 1994. <br><br>