2006 Massachusetts Code - Chapter 40F — Section 4A. Stock purchase agreements by commonwealth.

[Text of section effective until July 1, 2010. Repealed by 1987, 324, Sec. 6. See, also, 1990, 528, Sec. 6 and 2000, 159, Sec. 302.]

Section 4A. The state treasurer acting on behalf of the commonwealth shall enter into an agreement with the corporation providing that the commonwealth shall purchase shares of the corporation in the amount of two million dollars per fiscal year of the commonwealth for a period of two such years; in return for said investment the commonwealth shall receive two hundred thousand shares, designated Class A shares, of stock in the corporation per year upon each purchase for a total of four hundred thousand shares by the end of the second year. The state treasurer acting on behalf of the commonwealth shall enter into an agreement with the corporation providing that the commonwealth shall purchase shares of the corporation in the amount of five hundred thousand dollars per fiscal year of the commonwealth for a period of two such years; in return for said investment the commonwealth shall receive one hundred thousand shares, designated Class B shares, of stock in the corporation per year upon each such purchase for a total of two hundred thousand Class B shares by the end of the second year. These shares, together with the shares purchased by the state treasurer pursuant to section four, shall constitute the entire issues of stock of the corporation.

Such stock purchase agreements shall provide for purchase of stock at such time during each such year and upon such terms and under such conditions as the corporation may stipulate. The corporation may pledge such agreements and the rights of the corporation to receive amounts thereunder as security for the payment of debt obligations issued by the corporation. Each such agreement shall constitute a general obligation of the commonwealth for which the faith and credit of the commonwealth shall be pledged for the benefit of the corporation and of the holders of any debt obligations of the corporation which may be secured by a pledge of such agreement or of amounts to be received by the corporation under such agreement.

Amounts received by the corporation under the stock purchase agreement relating to Class A shares of stock may be used (i) to purchase capital participation instruments from community development corporations in return for an investment in specific projects as described in section four, (ii) as security for the payment of debt obligations issued by the corporation to finance the purchase of capital participation instruments as aforesaid, (iii) to pay the normal business expenses of the corporation, or (iv) for any combination of the foregoing.

Amounts received by the corporation under the stock purchase agreement relating to Class B shares of stock may be used (i) to provide financial assistance, loan instruments and guaranties for performance bonds to minority-owned or women-owned contractors notwithstanding the conditions described in section four, except that the CDFC must find (a) that the project plans conform to all applicable environmental, zoning, building, planning or sanitation laws, (b) that there is a reasonable expectation that the project will be successful, and (c) that its participation is necessary to the successful completion of the proposed project because funding for the project is unavailable in the traditional capital markets, or that credit has been offered on terms that would preclude the success of the project, (ii) as security for the payment of debt obligations issued by the corporation to finance the purchase of capital participation instruments as aforesaid, (iii) to pay the normal business expenses of the corporation, or (iv) for any combination of the foregoing.