Section 195.100  General

 

The provisions of Article 1 through Article 16 of the Business Corporation Act of 1983 (Ill. Rev. Stat. 1987, ch. 32, par. 1.01 et seq.) shall apply to Development Credit Corporations providing that in the event of a conflict the provision of the Illinois Development Credit Corporation Act (the "Act") (Ill. Rev. Stat. 1987, ch. 32, par. 1001 et seq.) shall apply.

 

Section 195.120  Articles of Incorporation

 

a)         A statement of the purpose for which a Development Credit Corporation is formed, as required in the Articles of Incorporation, will include the boundaries of the region within which that corporation intends to pursue that purpose.  The initial corporation to be approved will operate throughout the State of Illinois in order to maximize the availability of financing and business expertise.

 

1)         Subsequent corporations may be approved to operate within a specific region of the State of Illinois providing the Director of Financial Institutions is satisfied of the need and the availability of adequate financing and business expertise in accordance with the purposes set forth in Section 4 of the Act.

 

2)         The statement of purpose will further include the intention to pursue that purpose throughout the entire region defined and without prejudice or discrimination.

 

b)         The requirements for the Director's approval of the Articles of Incorporation that the incorporators have the confidence of their respective communities includes the requirement of appropriate business and financial experience (e.g. bank lending officer, venture capitalist, self-employed businessman).

 

Section 195.140  Member Obligations

 

a)         When called upon by a development credit corporation, a member shall make a reasonable loan to further the purpose of the corporation and subject to the maximum amount specified in Section 15 of the Act, but the corporation may not require a member to lend that maximum amount.

 

b)         In accordance with Section 19 of the Act, a development credit corporation is required to maintain an earned surplus equal to the total of the outstanding capital and paid in capital.  An increase in earned surplus may only be derived from net earnings and not by contribution from members or others.

 

Section 195.160  State Funds

 

The Board of Directors of a development credit corporation may accept grants or loans from, or sell non-voting stock to, a State agency but such agency will not become a voting stock holder or member of the corporation. The Director of the Department of Commerce and Community Affairs or its successor shall be given advance notice of all meetings of the Board of Directors for the purpose of suggesting prospects deserving financial help consistent with the purpose of the Act.

 

Section 195.180  Reports and Examinations

 

a)         A Development Credit Corporation shall submit to the Director annually, on or before May 1, a complete statement of its financial condition in accordance with generally accepted accounting principles under the accounting standards of the Financial Accounting Standard Board of the American Institute of Certified Public Accountants, Stamford, Connecticut (1989, no later amendments or editions included), as of the preceding December 31, as audited by a certified public accountant, and attach to the statement a brief summary of the status of each active project with outstanding loans, including but not limited to the following:

 

1)         information on the cost and sources of funds and capital and the total allowable maximum amount available from members, the maximum amount committed by each individual member, and the corporation's outstanding liabilities to members;

 

2)         classification of firms in the corporation's portfolio by standard industrial code, including a breakdown of:  

 

A)        size of firms by sales and number of employees;

 

B)        number and percentage of loans to manufacturing, service and wholesale businesses; and

 

C)        number and percentage of loans to traditional industries and to high technology firms within the manufacturing sector;

 

3)         information on the types of financing provided by the corporation, including guaranteed loans, the size and term of loans, and a breakdown of investments by senior debt, subordinated debt and equity financings;

 

4)         information on interest rates of loans, including percentage of fixed rate and variable rate loans;

 

5)         information on the use of capital provided by the corporation, including number of working capital loans, loans to assist leveraged buyouts by employees, management or others, and secured mortgages for plant expansion or new production facilities;

 

6)         information on resources and actions taken to advance the corporation's marketing program; and

 

7)         information on the corporation's regional offices, including a description of the volume of business and the nature of loan activity at each office.

 

b)         The records of the corporation's regional offices shall be examined annually to determine:

 

1)         compliance with the provisions of the Act; and

 

2)         the accuracy of the information contained in each corporation's annual report.

 

c)         The fee for the annual examination shall be $400 per examiner, per day or part thereof.

 

d)         The Director shall, for good cause, initiate additional investigation of the corporation at any time.

 

e)         The Department may conduct an examination for the purpose of verifying that the licensee has taken necessary actions to correct violations to the Act and/or related rules and shall charge the licensee $550 for each examiner day or portion thereof, when the Director determines the verification examination must be performed on site at any facility of the licensee.

 

(Source:  Amended at 26 Ill. Reg. 14257, effective October 1, 2002)

 

 

Section 195.200  Hearing Procedures

 

All administrative hearings shall be conducted in accordance with 38 Ill. Adm. Code 100.

 

(Source:  Amended at 46 Ill. Reg. 12550, effective July 8, 2022)