(a) “Applicant” shall mean a financial institution.

(b) “Application” shall mean a request for a loan or other credit guarantee submitted to the Authority by a financial institution.

(c) “Authority” shall mean the Arkansas Development Finance Authority established by Act 1062 of 1985.

(d) “Board” shall mean the board of directors of the Authority.

(e) “Borrower” shall mean an eligible disadvantaged business enterprise that is seeking the loan for its own purpose in fulfilling a contract or an individual(s) who is building a single family residence for their own habitation who in turn is obtaining the services of an eligible disadvantaged business enterprise entity to build their single family residence.

(f) “Committee” shall mean the Small Business Loan Committee of the Authority Board appointed by the Authority Board to approve guarantees under this program with requirement that all such actions taken by the Committee shall be reported at the next meeting of the Board.

(g) “Eligible disadvantaged business enterprise” shall mean businesses qualified either by the Arkansas Highway and Transportation Department as a disadvantaged business enterprise and/or by the U.S. Small Business Administration as an 8(a) contractor, or such other categories as the Board may designate.

(h) “Eligible purposes” shall mean working capital necessary to secure a performance bond from a surety to complete contract work. Performance bonds shall be specific to particular contracts. In the case of homebuilders, eligible purpose means construction of a low to moderate income single family owner occupied home. Eligible purposes do not include an insured loan made primarily to pay off or refinance an existing debt to a creditor whose loan is inadequately secured or who is in danger of sustaining a loss.

(i) “Escrow Agent” shall mean a company qualified as a funds management service and approved by surety companies to administer payments on a contract in a manner to assure cost accountability.

(j) “Financial institution” shall mean a financial institution defined in ACA Title 23, Chapter 30 or institutions created under Act 567 of 1957 Arkansas General Assembly which provided for Development Finance Corporations and all subsequent amendments.

(k) “Fund” shall mean $500,000 of unrestricted reserves of ADFA which was allocated by the Board to establish a fund to provide guarantees for loans made to Disadvantaged Business Enterprises by Resolution adopted January 20, 1994, or such other funds as may be made available for the purposes of the program.

(l) “Loan Authorization” shall mean a letter from the President or Vice-President of Development Finance or their designees to a financial institution agreeing to insure a loan to a borrower on the terms and conditions and subject to the requirements stated therein.

(m) “Loan Insurance Agreement” shall mean the agreement between the financial institution and the Authority required by Section 11 of these regulations.

(n) “Low to Moderate Income” shall mean eighty percent (80 %) to one hundred forty percent (140%) of the adjusted median household income as determined by HUD.

(o) “Pre-approved Borrower shall mean a borrower with a firm take-out commitment for a specific amount and specific term issued by a bona fide financial institution.

(p) “State” shall mean the State of Arkansas.

(q) “Surety” shall mean a surety agent of a licensed surety company listed by the Small Business Administration as qualified to participate in the SBA Surety Bond Guarantee Program, other sureties and/or insurance agencies as may be approved by the Authority.

(r) “Working Capital Loan” shall mean any loan the proceeds of which are to be used for operating, maintenance and other costs and expenses.