Title 7

PART 4290

Part 4290 - Rural Business Investment Company (“rbic”) Program

PART 4290 - RURAL BUSINESS INVESTMENT COMPANY (“RBIC”) PROGRAM Authority:7 U.S.C. 1989 and 2009cc et seq. Source:69 FR 32202, June 8, 2004, unless otherwise noted. Editorial Note:Nomenclature changes to part 4290 appear at 85 FR 16522, Mar. 24, 2020.

7:15.1.17.2.9.1SUBPART A
Subpart A - Introduction to Part 4290
7:15.1.17.2.9.1.82.1SECTION 4290.10
   4290.10 Description of the Rural Business Investment Company Program.
7:15.1.17.2.9.1.82.2SECTION 4290.15
   4290.15 Leveraged and Non-leveraged Rural Business Investment Companies.
7:15.1.17.2.9.1.82.3SECTION 4290.20
   4290.20 Legal basis and applicability of this part 4290.
7:15.1.17.2.9.1.82.4SECTION 4290.30
   4290.30 Amendments to Act and regulations.
7:15.1.17.2.9.1.82.5SECTION 4290.40
   4290.40 How to read this part 4290.
7:15.1.17.2.9.1.82.6SECTION 4290.45
   4290.45 Responsibility for implementing this part 4290.
7:15.1.17.2.9.2SUBPART B
Subpart B - Definition of Terms Used in Part 4290
7:15.1.17.2.9.2.82.1SECTION 4290.50
   4290.50 Definition of terms.
7:15.1.17.2.9.3SUBPART C
Subpart C - Qualifications for the RBIC Program
7:15.1.17.2.9.3.82SUBJGRP 82
   Organizing a RBIC
7:15.1.17.2.9.3.82.1SECTION 4290.100
   4290.100 Business form.
7:15.1.17.2.9.3.82.2SECTION 4290.110
   4290.110 Qualified management.
7:15.1.17.2.9.3.82.3SECTION 4290.120
   4290.120 Plan to invest in Rural Areas.
7:15.1.17.2.9.3.82.4SECTION 4290.130
   4290.130 Identified Rural Areas.
7:15.1.17.2.9.3.82.5SECTION 4290.140
   4290.140 Approval of initial Management Expenses.
7:15.1.17.2.9.3.82.6SECTION 4290.150
   4290.150 Management and ownership diversity requirement.
7:15.1.17.2.9.3.82.7SECTION 4290.160
   4290.160 Special rules for Partnership RBICs and LLC RBICs.
7:15.1.17.2.9.3.82.8SECTION 4290.165
   4290.165 Obligations of Control Persons.
7:15.1.17.2.9.3.83SUBJGRP 83
   Capitalizing a RBIC
7:15.1.17.2.9.3.83.9SECTION 4290.200
   4290.200 Adequate capital for RBICs.
7:15.1.17.2.9.3.83.10SECTION 4290.210
   4290.210 Minimum capital requirements for RBICs.
7:15.1.17.2.9.3.83.11SECTION 4290.230
   4290.230 Private Capital for RBICs.
7:15.1.17.2.9.3.83.12SECTION 4290.240
   4290.240 Limitations on non-cash capital contributions in Private Capital.
7:15.1.17.2.9.4SUBPART D
Subpart D - Application and Approval Process for RBIC Licensing
7:15.1.17.2.9.4.84.1SECTION 4290.300
   4290.300 When and how to apply for a RBIC License.
7:15.1.17.2.9.4.84.2SECTION 4290.310
   4290.310 Contents of application.
7:15.1.17.2.9.4.84.3SECTION 4290.320
   4290.320 Contents of comprehensive business plan.
7:15.1.17.2.9.4.84.4SECTION 4290.330
   4290.330 Guarantee fee.
7:15.1.17.2.9.5SUBPART E
Subpart E - Evaluation and Selection of RBICs
7:15.1.17.2.9.5.84.1SECTION 4290.340
   4290.340 Evaluation and selection - general.
7:15.1.17.2.9.5.84.2SECTION 4290.350
   4290.350 Eligibility and completeness.
7:15.1.17.2.9.5.84.3SECTION 4290.360
   4290.360 Initial review of Applicant's management team's qualifications.
7:15.1.17.2.9.5.84.4SECTION 4290.370
   4290.370 Evaluation criteria.
7:15.1.17.2.9.5.84.5SECTION 4290.380
   4290.380 Selection.
7:15.1.17.2.9.5.84.6SECTION 4290.390
   4290.390 Licensing as a RBIC.
7:15.1.17.2.9.6SUBPART F
Subpart F - Changes in Ownership, Structure, or Control
7:15.1.17.2.9.6.84SUBJGRP 84
   Changes in Control or Ownership of RBIC
7:15.1.17.2.9.6.84.1SECTION 4290.400
   4290.400 Changes in ownership of 10 percent or more of RBIC but no change of Control.
7:15.1.17.2.9.6.84.2SECTION 4290.410
   4290.410 Changes in Control of RBIC (through change in ownership or otherwise).
7:15.1.17.2.9.6.84.3SECTION 4290.420
   4290.420 Prohibition on exercise of ownership or Control rights in RBIC before approval.
7:15.1.17.2.9.6.84.4SECTION 4290.430
   4290.430 Notification of transactions that may change ownership or Control.
7:15.1.17.2.9.6.84.5SECTION 4290.440
   4290.440 Standards governing prior approval for a proposed transfer of Control.
7:15.1.17.2.9.6.84.6SECTION 4290.450
   4290.450 Notification of pledge of RBIC's shares.
7:15.1.17.2.9.6.85SUBJGRP 85
   Restrictions on Common Control or Ownership of Two or More RBICs
7:15.1.17.2.9.6.85.7SECTION 4290.460
   4290.460 Restrictions on Common Control or ownership of two (or more) RBICs.
7:15.1.17.2.9.6.86SUBJGRP 86
   Change in Structure of RBIC
7:15.1.17.2.9.6.86.8SECTION 4290.470
   4290.470 Prior approval of merger, consolidation, or reorganization of RBIC.
7:15.1.17.2.9.6.86.9SECTION 4290.480
   4290.480 Prior approval of changes to RBIC's business plan.
7:15.1.17.2.9.7SUBPART G
Subpart G - Managing the Operations of a RBIC
7:15.1.17.2.9.7.87SUBJGRP 87
   General Requirements
7:15.1.17.2.9.7.87.1SECTION 4290.500
   4290.500 Lawful operations under the Act.
7:15.1.17.2.9.7.87.2SECTION 4290.502
   4290.502 Representations to the public.
7:15.1.17.2.9.7.87.3SECTION 4290.503
   4290.503 RBIC's adoption of an approved valuation policy.
7:15.1.17.2.9.7.87.4SECTION 4290.504
   4290.504 Equipment of USDA or SBA officials.
7:15.1.17.2.9.7.87.5SECTION 4290.506
   4290.506 Safeguarding the RBIC's assets/Internal controls.
7:15.1.17.2.9.7.87.6SECTION 4290.507
   4290.507 Violations based on false filings and nonperformance of agreements with the Agency or SBA.
7:15.1.17.2.9.7.87.7SECTION 4290.508
   4290.508 Compliance with non-discrimination laws and regulations applicable to federally-assisted programs.
7:15.1.17.2.9.7.87.8SECTION 4290.509
   4290.509 Employment of USDA or SBA officials.
7:15.1.17.2.9.7.88SUBJGRP 88
   Management and Compensation
7:15.1.17.2.9.7.88.9SECTION 4290.510
   4290.510 Approval of RBIC's Investment Adviser/Manager.
7:15.1.17.2.9.7.88.10SECTION 4290.520
   4290.520 Management Expenses of a RBIC.
7:15.1.17.2.9.7.89SUBJGRP 89
   Cash Management by a RBIC
7:15.1.17.2.9.7.89.11SECTION 4290.530
   4290.530 Restrictions on investments of idle funds by RBICs.
7:15.1.17.2.9.7.90SUBJGRP 90
   Secured Borrowing by RBICs
7:15.1.17.2.9.7.90.12SECTION 4290.550
   4290.550 Prior approval of secured third-party debt of RBICs.
7:15.1.17.2.9.7.91SUBJGRP 91
   Voluntary Decrease in Regulatory Capital
7:15.1.17.2.9.7.91.13SECTION 4290.585
   4290.585 Voluntary decrease in RBIC's Regulatory Capital.
7:15.1.17.2.9.8SUBPART H
Subpart H - Recordkeeping, Reporting, and Examination Requirements for RBICs
7:15.1.17.2.9.8.92SUBJGRP 92
   Recordkeeping Requirements for RBICs
7:15.1.17.2.9.8.92.1SECTION 4290.600
   4290.600 General requirement for RBIC to maintain and preserve records.
7:15.1.17.2.9.8.92.2SECTION 4290.610
   4290.610 Required certifications for Loans and Investments.
7:15.1.17.2.9.8.92.3SECTION 4290.620
   4290.620 Requirements to obtain information from Portfolio Concerns.
7:15.1.17.2.9.8.93SUBJGRP 93
   Reporting Requirements for RBICs
7:15.1.17.2.9.8.93.4SECTION 4290.630
   4290.630 Requirement for RBICs to file financial statements and supplementary information with the Agency.
7:15.1.17.2.9.8.93.5SECTION 4290.640
   4290.640 Requirement to file portfolio financing reports with the Agency.
7:15.1.17.2.9.8.93.6SECTION 4290.650
   4290.650 Requirement to report portfolio valuations to the Agency
7:15.1.17.2.9.8.93.7SECTION 4290.660
   4290.660 Other items required to be filed by RBIC with the Agency.
7:15.1.17.2.9.8.93.8SECTION 4290.680
   4290.680 Reporting changes in RBIC not subject to prior approval.
7:15.1.17.2.9.8.94SUBJGRP 94
   Examinations of RBICs by the Agency for Regulatory Compliance
7:15.1.17.2.9.8.94.9SECTION 4290.690
   4290.690 Examinations.
7:15.1.17.2.9.8.94.10SECTION 4290.691
   4290.691 Responsibilities of RBIC during examination.
7:15.1.17.2.9.8.94.11SECTION 4290.692
   4290.692 Examination fees.
7:15.1.17.2.9.9SUBPART I
Subpart I - Financing of Enterprises by RBICs
7:15.1.17.2.9.9.95SUBJGRP 95
   Determining Eligibility of an Enterprise for RBIC Financing
7:15.1.17.2.9.9.95.1SECTION 4290.700
   4290.700 Requirements concerning types of enterprises to receive financing.
7:15.1.17.2.9.9.95.2SECTION 4290.720
   4290.720 Enterprises that may be ineligible for Financing.
7:15.1.17.2.9.9.95.3SECTION 4290.730
   4290.730 Financings which constitute conflicts of interest.
7:15.1.17.2.9.9.95.4SECTION 4290.740
   4290.740 Portfolio diversification (“overline” limitation).
7:15.1.17.2.9.9.95.5SECTION 4290.760
   4290.760 How a change in size or activity of a Portfolio Concern affects the RBIC and the Portfolio Concern.
7:15.1.17.2.9.9.96SUBJGRP 96
   Structuring RBIC Financing of Eligible Enterprises - Types of Financings
7:15.1.17.2.9.9.96.6SECTION 4290.800
   4290.800 Financings in the form of Equity Securities.
7:15.1.17.2.9.9.96.7SECTION 4290.810
   4290.810 Financings in the form of Loans.
7:15.1.17.2.9.9.96.8SECTION 4290.815
   4290.815 Financings in the form of Debt Securities.
7:15.1.17.2.9.9.96.9SECTION 4290.820
   4290.820 Financings in the form of guarantees.
7:15.1.17.2.9.9.96.10SECTION 4290.825
   4290.825 Purchasing securities from an underwriter or other third party.
7:15.1.17.2.9.9.96.11SECTION 4290.830
   4290.830 Minimum term of Financing.
7:15.1.17.2.9.9.96.12SECTION 4290.835
   4290.835 Exceptions to minimum term of Financing.
7:15.1.17.2.9.9.96.13SECTION 4290.840
   4290.840 Maximum term of Financing.
7:15.1.17.2.9.9.96.14SECTION 4290.845
   4290.845 Maximum rate of amortization on Loans and Debt Securities.
7:15.1.17.2.9.9.96.15SECTION 4290.850
   4290.850 Restrictions on redemption of Equity Securities.
7:15.1.17.2.9.9.96.16SECTION 4290.860
   4290.860 Financing fees and expense reimbursements a RBIC may receive from an Enterprise.
7:15.1.17.2.9.9.96.17SECTION 4290.880
   4290.880 Assets acquired in liquidation of Portfolio securities.
7:15.1.17.2.9.9.97SUBJGRP 97
   Limitations on Disposition of Assets
7:15.1.17.2.9.9.97.18SECTION 4290.885
   4290.885 Disposition of assets to RBIC's Associates or to competitors of Portfolio Concerns.
7:15.1.17.2.9.9.97.19SECTION 4290.900
   4290.900 Management fees for services provided to an Enterprise by RBIC or its Associate.
7:15.1.17.2.9.10SUBPART J
Subpart J - Financial Assistance for RBICs (Leverage)
7:15.1.17.2.9.10.98SUBJGRP 98
   General Information About Obtaining Leverage
7:15.1.17.2.9.10.98.1SECTION 4290.1100
   4290.1100 Type of Leverage and application procedures.
7:15.1.17.2.9.10.98.2SECTION 4290.1120
   4290.1120 General eligibility requirements for Leverage.
7:15.1.17.2.9.10.98.3SECTION 4290.1130
   4290.1130 Leverage fees payable by RBIC.
7:15.1.17.2.9.10.98.4SECTION 4290.1140
   4290.1140 RBIC's acceptance of remedies under § 4290.1810.
7:15.1.17.2.9.10.99SUBJGRP 99
   Maximum Amount of Leverage for Which a RBIC Is Eligible
7:15.1.17.2.9.10.99.5SECTION 4290.1150
   4290.1150 Maximum amount of Leverage for a RBIC.
7:15.1.17.2.9.10.100SUBJGRP 100
   Conditional Commitments To Reserve Leverage for a RBIC
7:15.1.17.2.9.10.100.6SECTION 4290.1200
   4290.1200 Leverage commitment to a RBIC - application procedure, amount, and term.
7:15.1.17.2.9.10.100.7SECTION 4290.1220
   4290.1220 Requirement for RBIC to file financial statements at the time of request for a draw.
7:15.1.17.2.9.10.100.8SECTION 4290.1230
   4290.1230 Draw-downs by RBIC under Leverage commitment.
7:15.1.17.2.9.10.100.9SECTION 4290.1240
   4290.1240 Funding of RBIC's draw request through sale to third-party.
7:15.1.17.2.9.10.101SUBJGRP 101
   Distributions by RBICs With Outstanding Leverage
7:15.1.17.2.9.10.101.10SECTION 4290.1500
   4290.1500 Restrictions on distributions to RBIC investors while RBIC has outstanding Leverage.
7:15.1.17.2.9.10.102SUBJGRP 102
   Funding Leverage by Use of Guaranteed Trust Certificates (“TCs”)
7:15.1.17.2.9.10.102.11SECTION 4290.1600
   4290.1600 Agency's authority to issue and guarantee Trust Certificates.
7:15.1.17.2.9.10.102.12SECTION 4290.1610
   4290.1610 Effect of prepayment or early redemption of Leverage on a Trust Certificate.
7:15.1.17.2.9.10.102.13SECTION 4290.1620
   4290.1620 Functions of agents, including Central Registration Agent, Selling Agent and Fiscal Agent.
7:15.1.17.2.9.10.102.14SECTION 4290.1630
   4290.1630 Regulation of Brokers and Dealers and disclosure to purchasers of Leverage or Trust Certificates.
7:15.1.17.2.9.10.102.15SECTION 4290.1640
   4290.1640 Agency's access to records of the CRA, Brokers, Dealers and Pool or Trust assemblers.
7:15.1.17.2.9.10.103SUBJGRP 103
   Miscellaneous
7:15.1.17.2.9.10.103.16SECTION 4290.1700
   4290.1700 Agency's transfer of interest in a RBIC's Leverage security.
7:15.1.17.2.9.10.103.17SECTION 4290.1710
   4290.1710 Agency's authority to collect or compromise claims.
7:15.1.17.2.9.10.103.18SECTION 4290.1720
   4290.1720 Characteristics of Agency's guarantee.
7:15.1.17.2.9.11SUBPART K
Subpart K - RBIC's Noncompliance With Terms of Leverage
7:15.1.17.2.9.11.104SUBJGRP 104
   Computation of RBIC'S Capital Impairment
7:15.1.17.2.9.11.104.1SECTION 4290.1810
   4290.1810 Events of default and the Agency's remedies for RBIC's noncompliance with terms of Debentures.
7:15.1.17.2.9.11.104.2SECTION 4290.1830
   4290.1830 RBIC's Capital Impairment definition and general requirements.
7:15.1.17.2.9.11.104.3SECTION 4290.1840
   4290.1840 Computation of RBIC's Capital Impairment Percentage.
7:15.1.17.2.9.12SUBPART L
Subpart L - Ending Operations as a RBIC
7:15.1.17.2.9.12.105.1SECTION 4290.1900
   4290.1900 Termination of participation as a RBIC.
7:15.1.17.2.9.13SUBPART M
Subpart M - Miscellaneous
7:15.1.17.2.9.13.105.1SECTION 4290.1910
   4290.1910 Non-waiver of rights or terms of Leverage security.
7:15.1.17.2.9.13.105.2SECTION 4290.1920
   4290.1920 RBIC's application for exemption from a regulation in this part 4290.
7:15.1.17.2.9.13.105.3SECTION 4290.1930
   4290.1930 Effect of changes in this part 4290 on transactions previously consummated.
7:15.1.17.2.9.13.105.4SECTION 4290.1940
   4290.1940 Integration of this part with other regulations applicable to USDA's programs.
7:15.1.17.2.9.14SUBPART N
Subpart N - Requirements for Operational Assistance Grants to RBICs
7:15.1.17.2.9.14.105.1SECTION 4290.2000
   4290.2000 Operational Assistance Grants to RBICs.
7:15.1.17.2.9.15SUBPART O
Subpart O - Additional Requirements for Non-Leveraged Licensees and Exceptions to Regulations
7:15.1.17.2.9.15.105.1SECTION 4290.3000
   4290.3000 Non-leveraged RBICs - General.
7:15.1.17.2.9.15.105.2SECTION 4290.3001-4290.3002
   4290.3001-4290.3002 [Reserved]
7:15.1.17.2.9.15.105.3SECTION 4290.3003
   4290.3003 Responsibilities for implementing Non-leveraged RBICs.
7:15.1.17.2.9.15.105.4SECTION 4290.3004
   4290.3004 [Reserved]
7:15.1.17.2.9.15.105.5SECTION 4290.3005
   4290.3005 Qualifications for the Non-leveraged RBIC Program.
7:15.1.17.2.9.15.105.6SECTION 4290.3006-4290.3009
   4290.3006-4290.3009 [Reserved]
7:15.1.17.2.9.15.105.7SECTION 4290.3010
   4290.3010 Application and Approval Process for RBIC licensing without Leverage.
7:15.1.17.2.9.15.105.8SECTION 4290.3011-4290.3014
   4290.3011-4290.3014 [Reserved]
7:15.1.17.2.9.15.105.9SECTION 4290.3015
   4290.3015 Evaluation and selection of Non-leveraged RBICs.
7:15.1.17.2.9.15.105.10SECTION 4290.3016-4290.3019
   4290.3016-4290.3019 [Reserved]
7:15.1.17.2.9.15.105.11SECTION 4290.3020
   4290.3020 Changes in Ownership, Structure, or Control.
7:15.1.17.2.9.15.105.12SECTION 4290.3021-4290.3024
   4290.3021-4290.3024 [Reserved]
7:15.1.17.2.9.15.105.13SECTION 4290.3025
   4290.3025 Managing the Operations of a RBIC.
7:15.1.17.2.9.15.105.14SECTION 4290.3026-4290.3029
   4290.3026-4290.3029 [Reserved]
7:15.1.17.2.9.15.105.15SECTION 4290.3030
   4290.3030 Financing of Enterprises by RBICs.
7:15.1.17.2.9.15.105.16SECTION 4290.3031-4290.3034
   4290.3031-4290.3034 [Reserved]
7:15.1.17.2.9.15.105.17SECTION 4290.3035
   4290.3035 Recordkeeping, Reporting, and Examination Requirements for RBICs.
7:15.1.17.2.9.15.105.18SECTION 4290.3036-4290.3039
   4290.3036-4290.3039 [Reserved]
7:15.1.17.2.9.15.105.19SECTION 4290.3040
   4290.3040 Financial Assistance for RBICs.
7:15.1.17.2.9.15.105.20SECTION 4290.3041
   4290.3041 Events of default and the Agency's remedies for RBIC's noncompliance with terms of licensure.
7:15.1.17.2.9.15.105.21SECTION 4290.3042-4290.3044
   4290.3042-4290.3044 [Reserved]
7:15.1.17.2.9.15.105.22SECTION 4290.3045
   4290.3045 Computation of RBIC's Capital Impairment.
7:15.1.17.2.9.15.105.23SECTION 4290.3046-4290.3049
   4290.3046-4290.3049 [Reserved]
7:15.1.17.2.9.15.105.24SECTION 4290.3050
   4290.3050 Operational Assistance Grants for RBICs.
7:15.1.17.2.9.15.105.25SECTION 4290.3051-4290.3099
   4290.3051-4290.3099 [Reserved]