RD 4280-4 Letter of Conditions

Form RD 4280-4 Form Approved

(12-06) OMB No. 0570-0035

RURAL ECONOMIC DEVELOPMENT GRANT

LETTER OF CONDITIONS

[ (1) Date]

[ (2) __Name____]

President

[ (3) __RUS Utility____]

[ (4) __Address___]

[ (5) __City, State, Zip___]

Dear Mr./Mrs. [ (6) __Name____]:

We are pleased to announce that the application of the _[ (7) Grantee]________ (the Grantee) for a grant in the amount of _[ (8) $ Amount]________ (Grant) to make an initial loan to __ (9) Ultimate Recipient___](Ultimate Recipient) and to establish a revolving loan fund (Revolving Loan Fund) in accordance with the Grantee’s Revolving Loan Fund Plan dated __[ (10) Date]__, as approved by Rural Development (Plan) has received approval of Rural Development, subject to the following terms and conditions:

A. The Grantee provides:

1. evidence that it has created a Revolving Loan Fund Account (Account)

and has deposited the approved contribution amount in the Account.

2. a resolution of its Board of Directors adopting the Plan approved by Rural

Development.

3. satisfactory evidence that it has obtained fidelity bond coverage on all of its

officers, employees or agents that are authorized to receive or disburse

funds from the Revolving Loan Fund, in the total amount of the Grant, or

the Revolving Loan Fund, whichever is greater.

4. duplicate original sets of duly authorized and executed copies of this Letter

of Conditions.

5. duplicate original sets of duly authorized and executed copies of the Rural

Economic Development Grant Agreement (Grant Agreement.)

According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a valid OMB control number. The valid OMB control number for this information collection is 0570-0035. The time required to complete this information collection is estimated to average one hour per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

6. a legal opinion from its counsel stating that the Grantee possesses the

necessary legal authority to execute the Letter of Conditions and the Grant

Agreement and to execute the Plan.

7. evidence of satisfactory written procedures to:

(i) minimize the time elapsing between receipt of funds from Rural

Development and disbursement of funds to the Ultimate Recipient,

(ii) ensure funds control and accountability in accordance with 7 CFR

parts 3015 and 3019 as applicable,

(iii) limit cash advances from Rural Development to the minimum

amounts needed for the actual, immediate cash required for

carrying out the project.

And,

B. Rural Development approves

1. the Grantee’s loan agreement, promissory note(s), and security agreement

which will be entered into with the Ultimate Recipient.

2. a legal opinion provided by counsel for the Ultimate Recipient, regarding

the legal ability of the Ultimate Recipient to incur debt and perform its

obligations under the loan agreement.

3. satisfactory evidence that the following other terms and conditions have

been met:

(i)

(ii)

The enclosed certification form entitled "Certification Regarding Debarment,

Suspension, Ineligibility and Voluntary Exclusion - Lower Tier Covered

Transactions" must be referenced in, and included as an exhibit to, the loan agreement that you execute with the Ultimate Recipient. The Ultimate Recipient in turn, must require these certifications in any lower tier covered transactions. Please note this certification is for the signature of the Ultimate Recipient.

Please evidence acceptance of the terms and conditions of this Letter of Conditions by executing and dating the enclosed duplicate original in the space provided and returning it to Rural Development within 30 days from the date of this Letter of Conditions. The Grantee must comply with the conditions set forth in this Letter of Conditions within 120 days from the date of its acceptance. Unless extended, if the Grantee has not complied with these stipulations, the Grant commitment will be automatically rescinded.

Sincerely,

[ (12) __State Director____]

Accepted and Agreed to:

_______________________

[ (13) __Intermediary___]

by: ______________________ ___________________________

[ (14) __President__] [ 15) __Date___]

(SEAL)Attested to for the Grantee:

by: ______________________

[ (16) __Secretary___]

Enclosures:

• Duplicate Original Letter of Conditions

• Rural Economic Development Grant Agreement

• Certification Regarding Debarment, Suspension, Ineligibility

and Voluntary Exclusion - Lower Tier Covered Transactions

• Form of Legal Opinion

• Standard Form 270

INSTRUCTIONS FOR FORM RD 4280-4

Rural Economic Development Grant Letter of Conditions

Rural Economic Development Loan and Grant Program

Rural Development and the Intermediary complete this form. Rural Development uses this form for establishing the terms and conditions between the Intermediary and the Government regarding a grant.

Submit the original of the completed form in hard copy to the appropriate Rural Development State Office.

Features for transmitting the form electronically are available to those customers with access credentials only. If you would like to establish online access with USDA, follow the instructions provided at the USDA eForms web site.

Rural Development and the Intermediary complete all of the items specified in the following table.

Fld Name/Item No.	Instruction
1. Date	Enter the date the Letter of Conditions was signed.
2. Name	Enter the name of the contact for the intermediary.
3. RUS Utility	Enter the name of the intermediary.
4. Address	Enter the address of the intermediary.
5. City/State/Zip	Enter the City/State/Zip of the intermediary.
6. Name	Enter the name of the contact for the intermediary.
7. Grantee	Enter the name of the grant recipient.
8. Amount	Enter the amount of the grant.
9. Ultimate Recipient	Enter the name of the ultimate recipient of the grant.
10. Date	Enter the date the Revolving Loan Fund Plan was dated.
11. State Director	State Director’s signature.
12. Intermediary	Intermediary’s signature.

13. President	President’s signature.
14. Date	Enter the date the president signs.
15. Secretary	Secretary of the board’s signature.