Northern Ontario Loan Insurance Regulations (SOR/88-503)

3 (1) An applicant requiring that the Minister enter into a loan insurance agreement shall apply in writing to the Minister on or before March 31, 1992 and shall provide a detailed description of the project and any other information that is necessary to effectively evaluate the application.

(2) The Minister may enter into a loan insurance agreement where

• (a) the loan agreement is for an amount of not more than $15,000,000 and not less than $100,000 and the term of the loan does not exceed 15 years;

• (b) the total amount of the loan is to be used to finance the applicant’s project;

• (c) subject to section 4, the loan is to be used to finance only capital costs;

• (d) the applicant is unable to obtain a loan on commercially acceptable terms, without a loan insurance agreement;

• (e) the project would not likely be carried out within the proposed time or scope or in the proposed location, as described in an application made pursuant to subsection (1), without a loan insurance agreement;

• (f) an application made pursuant to subsection (1) includes pro forma financial statements for each year in which loan insurance is required by the lender;

• (g) the project and the applicant’s commercial operations, as the case may be, are or are expected to be commercially viable, subject to reasonable commercial risk;

• (h) an application made pursuant to subsection (1) indicates it is likely that the applicant will have equity representing a minimum of 20 per cent of the capital costs for the project;

• (i) the lender acquires an enforceable security for the purpose of securing the repayment of the loan under the loan agreement in a form consistent with standard banking practices;

• (j) the project would constitute a significant contribution to the economic benefit of the designated region and of Canada; and

• (k) all other requirements of these Regulations are met.