RD 4279-1 Application for Loan Guarantee

Position 3

Form RD 4279-1
(Rev. 10-08)

FORM APPROVED
OMB No. 0570-0017
OMB No. 0570-0050
OMB No. 0570-0055

UNITED STATES DEPARTMENT OF AGRICULTURE
RURAL DEVELOPMENT

APPLICATION FOR LOAN GUARANTEE
(Business and Industry and Section 9006 Program)
Section 1001 of Title 18, United States Code provides: “Whoever, in any matter within the jurisdiction of any department or agency of the United States
knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or device a material fact or makes any false, ficitious or fraudulent statements
or representations, or makes or uses any false writing or document knowing the same to contain any false, ficitious or fraudulent statement or entry shall
be fined under this title or imprisoned not more that five years or both.
CERTIFICATION: Information contained below and in attached exhibits is true and complete to my best knowledge. (Misrepresentation of material
facts may be the basis for denial of credit by the United States Department of Agriculture (“USDA”) .)
PART A: Completed By Borrower
1. AMOUNT OF LOAN
$

2. NAME OF BORROWER

3. ADDRESS (Include Zip Code)

4. CONTACT PERSON

5. TELEPHONE NUMBER (Include Area Code)
(
)

6. TAX ID# OR SOCIAL SECURITY# FOR
INDIVIDUALS

7. PROJECT LOCATION (Town/City)

8. POPULATION

12.DATE BUSINESS ESTABLISHED

13. DUNS Number

10. TYPE OF BORROWER
11.NAICS
CODE
Cooperative
Proprietorship
Partnership
Indian Tribe
Corporation
Political Subdivision

14. a. THIS PROJECT IS

15. IF BORROWER IS AN INDIVIDUAL

An expansion

9. COUNTY

(Item 10 checked proprietorship)

New Business

A. IS HE OR SHE A VETERAN?
Refinancing

Transfer of ownership

YES

NO

16. HAS BORROWER OR RELATED INDIVIDUAL EVER BEEN IN RECEIVERSHIP
OR BANKRUPTCY?
YES
NO

Other

B. MARITAL STATUS b. JOBS:

Created

Saved

Married

Separated

Unmarried

17.SCHEDULE OF INSTALLMENT DEBTS, CONTRACTS, NOTES AND MORTGAGES PAYABLE CORRELATED TO LATEST BALANCE
SHEET DATED ________________________________________ , INDICATE WITH ASTERISK (*) DEBTS TO BE REPAID WITH PROPOSED
USDA GUARANTEED LOAN IF APPLICABLE. (*Attach additional sheet if necessary.)
CREDITOR

ORIGINAL
LOAN
AMOUNT

LOAN
BALANCE

DATE OF
LOAN

INTEREST
RATE

MATURITY
DATE

M - MONTHLY
Q - QUARTERLY
A - ANNUAL PAY

CURRENT?
Y = YES
N = NO

SECURITY

18.For Existing Businesses Only - Aging of accounts receivable, correlated to lastest balance sheet dated __________________ , typical selling terms are:
30 Days or Less,
60 Days or Less,
90 Days or Less,
Other (Specify)
30 Days or Less ................ $ _______________________
31 Days to 60 Days ........... $ _______________________

61 to 90 Days .................. $ _______________________
Over 90 Days .................... $ _______________________

19. PROFESSIONAL SERVICE FEES FOR ENGINEERS, ARCHITECTS, LAWYERS, ACCOUNTANTS, LOAN PACKAGERS, APPRAISERS, PROVIDED
IN THE PREPARATION OF THIS APPLICATION (SUBJECT TO USDA APPROVAL)
NAME

SERVICE

FEE/COMPENSATION

SOURCE OF FUNDING

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 0570-0017, 0570-0050, and 0570-0055. The time required to complete this information collection is estimated to average 4 hours
per response, including the time for reviewing instructions, searching exsisting data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

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20.PROVIDE INFORMATION BELOW ON KEY PEOPLE (PROPRIETOR, PARTNERS, OFFICERS, DIRECTORS, KEY EMPLOYEES
AND STOCKHOLDERS WITH 20% OR MORE INTEREST IN THE BUSINESS). ALSO INCLUDE PERSONS OR CORPORATION THAT WILL
GUARANTEE LOAN. (*Optional, used for monitoring purposes only.)
NAME AND POSITION

RACE *

SEX *

U.S. CITIZEN
ANNUAL
% OF
YES OR NO COMPENSATION OWNERSHIP

OUTSIDE
NET WORTH

PERSONAL/
CORPORATE
GUARANTEE: YES OR NO

ATTACH THE FOLLOWING IF NOT ALREADY SUBMITTED:
21. ATTACH BUSINESS PLAN that should as a minimum include description of business or project, management experience,
products or services, proposed use of funds, community benefits, type and number of jobs, availability of labor or raw materials
or supplies, names of any corporate parents, affiliates, subsidiaries and describe relationship, including products, ownership
between borrower, parent, affiliates, etc..
22. “Certification of Non-Relocation and Market Capacity Information Report,” Form 4279-2. (Not applicable to Section 9006
Program).
23. State Clearinghouse comments or recommendations.
24. For companies listed on major stock exchanges and or subject to the Securities and Exchange Commission regulations, a
copy of Form 10-K, “ Annual Report Pursuant to Section 13 or 15D of the Act of 1934.”
25. “Request for Environmental Information,” Form RD 1940-20, and attachments. (If applicable)
26. Independent Feasibilty Study. (If applicable, see RD Instruction 4279-B, for Section 9006 Program, see
§4280.128(b)(1)(vii).
27. Architectural or Engineering Plans. (If applicable)
28. Cost estimates and forecasts of contingency funds to cover cost increases or project changes.
29. Financial Statements; a) At least 3 years historical income statements and balance sheets (if an existing business), including
parents, affiliate and subsidiary firms, Annual Audits if available; b) Current (not more than 90 days old) balance sheet and
profit and loss statement (if an existing business); c) Pro-forma balance sheet (at startup); d) 2 years of projections: income
statements, balance sheets and cash flow statements supported by a list of assumptions (monthly first year, quarterly for 2nd
year). For the Section 9006 program, instead of complying with this item, comply with the requirements in § 4280.128.
30. Record of any pending or final regulatory or legal (civil or criminal) action against the business, parent, affiliate, proposal
guarantors, subsidiaries, principal stockholders, officers and directors.
31. If a health care facility, a “Certificate of Need” (if required by state law).
32. Current personal (not more than 60 days old) and corporate (not more than 90 days old) financial statements on guarantors
in Item 20, above.
33. Technical Report (Section 9006 Program only; see §4280.128(b)(1)(vi) or § 4280.128(c)(1)(ii), as applicable.
34. Franchise agreement, if applicable.
By my signature, I certify that I have read the General Borrower Certifications contained in this application. My signature represents my
agreement to comply with the limitations outlined in the General Borrower Certifications.
BORROWER SIGNATURE
CORPORATE SEAL

ATTEST

BY

TITLE

TITLE

DATE

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GENERALBORROWER CERTIFICATIONS
(1) ASSURANCE AGREEMENT (TITLE VI, CIVIL RIGHTS ACT OF 1964)
“Recipient” herein hereby assures the United States Department of Agriculture that Recipient is in compliance with and will continue to
comply with title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et. seq.), 7 C.F.R. part 15, and USDA regulations promulgated hereunder,
7 C.F.R. §1901.202 of subpart E of part 1901. In accordance with that Act and the regulations referred to above, Recipient agrees that in
connection with any program or activity for which Recipient receives Federal financial assistance (as such term is defined in 7 C.F.R. §15.2)
no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the
benefits of, or be otherwise subjected to discrimination.
A.

Recipient agrees that any transfer of any aided facility, other than personal property, by sale, lease or other conveyance of
contract, shall be, and shall be made expressly, subject to the obligations of this agreement and transferee’s assumption thereof.

B.

Recipient shall:
(1) Keep such records and submit to the Government such timely, complete, and accurate information as the Government may
determine to be necessary to ascertain compliance with this agreement and the regulations.
(2) Permit access by authorized employees of the USDA during normal business hours to such books, records, accounts and other
sources of information and its facilities as may be pertinent to ascertaining such compliance.
(3) Make available to users, participants, beneficiaries and other interested persons such information regarding the provisions
of this agreement and the regulations, and in such manner as the USDA finds necessary to inform such persons of the protection
assured them against discrimination.

C.

The obligations of this agreement shall continue:
(1) As to any real property, including any structure, acquired or improved with the aid of the Federal financial assistance, so
long as such real property is used for the purpose for which the Federal financial assistance is made or for another purpose
which affords similar services or benefits, or for as long as the recipient retains ownership or possession of the property,
whichever is longer.
(2) As to any personal property acquired or improved with the aid of the Federal financial assistance, so long as Recipient
retains ownership or possession of the property.
(3) As to any other aided facility or activity, until the last advance of funds under the loan or grant has been made.

D.

Upon any breach or violation of this agreement the Government may, at its option:
(1) Terminate or refuse to render or continue financial assistance for the aid of the property, facility, project, service or activity.
(2) Enforce this agreement by suit for specific performance or by any other available remedy under the laws of the United States or
the State in which the breach or violation occurs.

Rights and remedies provided for under this agreement shall be cumulative.
(2) EQUAL OPPORTUNITY AGREEMENT (EXECUTIVE ORDER 11246, AS AMENDED)
“Recipient” (whether one or more) and the USDA, pursuant to the rules and regulations of the Secretary of Labor (“Secretary”) issued
under the authority of Executive Order 11246, as amended, agree:
In consideration of financial assistance (whether by a loan, grant, loan guaranty, or other form of financial assistance) made or to be
made by the USDA to Recipient, Recipient hereby agrees, if the cash cost of construction work performed by Recipient or a construction
contract financed with such financial assistance exceeds $10,000—unless exempted by rules, regulations or orders of the Secretary
issued pursuant to section 204 of Executive Order 11246 of September 4, 1965.
A.

To incorporate or cause to be incorporated into any contract for construction work, or modification thereof, subject to the
relevant rules, regulations, and orders of the Secretary or of any prior authority that remain in effect, which is paid for in whole
or in part with the aid of such financial assistance, the following “Equal Opportunity Clause”:

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During the performance of this contract, the contractor agrees as follows:
(1) The contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex
or national origin. The contractor will take affirmative action to ensure that applicants are employed, and that employees are
treated equally during employment, without regard to their race, color, religion, sex or national origin. Such action shall include, but
not be limited, to the following: employment, upgrading demotion or transfer; recruitment or recruitment advertising;
layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship.
The contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be
provided by the USDA setting forth the provisions of this nondiscrimination clause.
(2) The contractor will, in all solicitations or advertisements for employees placed by or on behalf of the contractor, state that
all qualified applicants will receive consideration for employment without regard to race, color, religion, sex or national
origin.
(3) The contractor will send to each labor union or representative of workers with which he has a collective bargaining
agreementor other contract or understanding, a notice, to be provided by the USDA, advising the said labor union or
workers’ representative of the contractor’s commitments under this agreement as required pursuant to section 202(3)
of Executive Order 11246, and shall post copies of the notice in conspicuous places available to employees and
applicants for employment.
(4) The contractor will comply with all provisions of Executive Order 11246, and of all rules, regulations and relevant orders
of the Secretary of Labor and of any prior authority which remain in effect.
(5) The contractor shall furnish all information and reports required by Executive Order 11246, rules, regulations, and
orders, or pursuant thereto, and will permit access to his books, records, and accounts by the USDA, Office of Civil
Rights, and the Secretary for purposes of investigation to ascertain compliance with such rules, regulations, and orders.
(6) In the event of the contractor’s noncompliance with the Equal Opportunity (Federally Assisted Construction) clause or
with any of the said rules, regulations, or orders, this contract may be cancelled, terminated, or suspended in whole or in part
and the contractor may be declared ineligible for further Government Contracts or Federally Assisted construction contracts on accordance with procedures authorized in Executive Order No. 11246, and such other sanctions may be imposed
and remedies invoked as provided in Executive Order 11246, or by rule, regulation or order of the Secretary, or as provided
by Law No.
(7) The contractor will include the provisions of this Equal Opportunity (Federally Assisted Construction) clause in every
subcontract or purchase order, unless exempted by the rules, regulations, or orders of the Secretary of Labor issued
pursuant to section 204 of Executive Order 11246, so that such provisions will be binding upon each
such subcontractor or vendor. The contractor will take such action with respect to any subcontract or purchase order
USDA may direct as a means of enforcing such provisions, including sanctions for non-compliance: Provided, however,
that in the event the contractor becomes involved in or is threatened with litigation with a subcontractor or vendor as a
result such direction by the USDA, the contractor may request the United States to enter into such litigation to protect the
interest of the United States.
B.

To be bound by the provisions of the Equal Opportunity Clause in construction work performed by Recipient and paid for in
whole or in part with the aid of such financial assistance.

C.

To notify all prospective contractors to file the required “Compliance Statement,” Form RD 400-6, with their bids.

D.

Form AD-425, Instructions to Contractors, will accompany the notice of award of the contract. Bid conditions for all nonexempt
Federal and Federally assisted construction contracts require inclusion of the appropriate “Hometown” or “Imposed” plan
affirmative action and equal employment opportunity requirements. All bidders must comply with the bid conditions contained
in the invitation to be considered responsible bidders and hence eligible for the award.

E.

To assist and cooperate actively with the USDA and the Secretary in obtaining the compliance of contractors and subcontrac
tors with the porovisions of the Equal Opportunity Clause and the said rules, regulations, and orders, to obtain and furnish to
the USDA and the Secretary, Form AD-560, “Certification of Nonsegregated Facilities”, to submit the Monthly Employment
Utilization Report, Form CC-257, as required and such other information as may be required for the supervision of such
compliance, and to otherwise assist the USDA in the discharge of its primary responsibility for securing compliance.

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F.

To refrain from entering into any contract, or extension or other modification of a contract, subject to such Executive Order
with a contractor debarred from Government contracts or Federally assisted construction contracts pursuant to part 11,
subpart D, of such Executive Order or to prior authority; and to carry out such sanctions and penalties for violation of the
provisions of the Equal Opportunity Clause as may be imposed upon contractors and subcontractors by the USDA or the
Secretary pursuant to such subpart D.

G.

That if Recipient fails or refuses to comply with these undertakings, the USDA may take any or all of the following actions: (a)
cancel, terminate, or suspend said financial assistance in whole or in part; (b) refrain from extending any further assistance
under the program involved until satisfactory assurance of future compliance has been received from Recipient; and (c) refer
the case to the USDA Office of Civil Rights Enforcement and Adjudications Program Complaint and Adjudication Division,
U.S. Department of Agriculture for appropriate action.

(3) FEDERAL COLLECTION POLICIES FOR CONSUMER OR COMMERCIAL DEBTS
A.

The Recipient (Borrower) certifies, acknowledges and agrees that any loss claim(s) paid by the Government to the Lender on
account of any guarantee made pursuant to this application will be a Federal debt owed to the Government by the Recipient. In
such a case, the Government may use all legal collection remedies, including those under the Debt Collection Improvement Act.
The Government’s right to collect this Federal debt will not be affected by any release provided to the Recipient by the Lender.
Lender agrees that any collection by the Government of this Federal debt will not be shared with the Lender.

B.

The Federal Government is authorized by law to take any and all actions in the event your loan payments become delinquent
or you default on your loan:

• Report your name and account information to a credit reporting agency.
• Assess interest and penalty charges for the period of time that payment is not made.
• Assess charges to cover additional administrative costs incurred by the Government to service your account.
• Offset amounts to be paid to you under other Federal programs.
• Refer your account to a private collection agency to collect the amount due.
• Foreclosure on any security you have given for the loan.
• Pursue legal action to collect through the courts.
• Report any written off debt to the Internal Revenue Service as taxable income.
• If you are a current or retired Federal employee, take action to offset your salary, or civil service retirement benefits.
• Debar or suspend you from doing business with the Federal Government either as a participant or principal throughout
the Executive Branch of the Federal Government for a period of debarment or suspension.
(4) STATEMENT REQUIRED BY THE PRIVACY ACT
The USDA is authorized by the Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et. seq.) or other Acts administered by
USDA to solicit the information requested on USDA application forms.
Disclosure of information requested is voluntary. However, failure to disclose certain items of information requested, including your
Social Security Number or Federal Identification Number, will result in the rejection of your application.
The principal purposes for collecting the requested information are to determine eligibility for USDA credit or other financial
assistance, the need for interest credit or other servicing actions, for the servicing of your loan, and for statistical analysis.
Information provided may be used outside of the Department of Agriculture for the following purposes:

• To provide the basis for borrower success stories in USDA news releases.
• Referral to the appropriate law enforcement agency as required by 40 FR 38924 (1975).
• Referral to employees, business, landlords, creditors or others to determine repayment ability and eligibility for
USDA programs.

• Referral to a contractor providing services to USDA in connection with your loan.
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• Referral to a credit reporting agency.
• Referral to a person or organization when USDA decides such referral is appropriate to assist in the collection or servicing of the loans.
• Referral to a Federal Records Center for storage.
Every effort will be made to protect the privacy of applicants and borrowers.
WARNING
All information supplied to USDA by you or your agents in connection with your loan application may be released to interested third
parties, including competitors, without your knowledge or consent under the provision of the Freedom of Information Act (5 U.S.C. 522).
Much of the information not clearly marked “Confidential” may routinely be released if a request is received for same. Further, if we receive a
request for information marked “Confidential,” the Federal Government will release the information unless you can demonstrate
to our satisfaction that release of the information would be likely to produce substantial competitive harm to your business or would
constitute a clearly unwarranted invasion of personal privacy. Also, forms, consultant reports, etc., cannot be considered confidential in
their entirety if confidential material contained therein can reasonably be segregated from other information.
Information submitted may be made available to the public during the time it is held in Government files regardless of the action taken by
USDA on your application.
FEDERAL EQUAL CREDIT OPPORTUNITY ACT STATEMENT
Federal law does not allow discrimination of any kind. You cannot be denied a loan because of your race, color, religion, national
origin, sex, marital status, handicap, or age (if you can legally sign a contract). You cannot be denied a loan because all or part of your
income is from a public assistance program. If you believe that you have been discriminated against for any of these reasons, you can
write the secretary of Agriculture, Washington, D.C. 20250. You cannot be denied a loan because you exercised your rights under
the Consumer Credit Protection Act. You must have exercised these rights in good faith. The Federal Agency responsible for
seeing this law is obeyed is the Federal Trade Commission, Washington, D.C. 20580.

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PART B: Completed By Lender
2. ADDRESS (Include Zip Code)

1. NAME OF LENDER

3. LENDER TAX ID NUMBER

4. CONTACT PERSON

5. TELEPHONE NUMBER (Include Area Code)
(
)

6. IS LOAN WITHIN LENDER’S LEGAL
LENDING LIMIT?
Yes
No

7. GUARANTEE PERCENT
REQUESTED? __________ %

8. WHY IS GUARANTEE NEEDED?

9. LIST ANY OFFICER, DIRECTOR, STOCKHOLDER OR EMPLOYEE WHO HAS A FINANCIAL INTEREST IN THE BORROWER,
OR VICE VERSA,AND DESCRIBE THE RELATIONSHIP AND INTEREST:

10.LIST ALL FEES LENDER WILL CHARGE FOR THE LOAN, INCLUDING THE USDA GUARANTEE FEE:

11.LENDER’S SERVICING PLAN (FIELD INSPECTIONS, INTERIM STATEMENTS, ANNUAL AUDITS CREDIT ANALYSIS, ETC.):

12.LIST ANY OTHER USDA GUARANTEED BUSINESS AND INDUSTRY LOANS MADE BY LENDER:
Borrower Name

Program Type

Total Loan Amount

Guaranteed Loan Amount

Closing Date

13.PROPOSED KEY EMPLOYEE LIFE INSURANCE, EMPLOYEE NAME(S) AND AMOUNT(S)
Assigned to Guaranteed Loan?
Assigned to Guaranteed Loan?

14.COLLATERAL AVAILABLE FOR THE USDA GUARANTEED LOAN:
Value
Presently Owned or
Value
Type
to be Acquired

Discount
Factor

Accounts Receivable
Inventory
Office Furniture and Equipment
Automotive Equipment
Machinery and Equipment
Building
Land
Other:
TOTALS
* Indicate by asterisk liens to be paid off with USDA guaranteed loan funds

7

Prior Liens
*

Net Collateral
Value

15.
Project Purpose and Funding

Borrower Contribution

USDA Guaranteed Loan

Other Funds

Total

Working Capital

Office Furniture and Equipment
Automotive Equipment
Machinery and Equipment
Real Estate
Debt Restructuring

Fees: Professional, USDA Guarantee

Other

TOTAL
Proposed
Financing

16.

Loan
Amount

Interest Rate
“V” variable

Base Rate
As of Today

Interest Rate
Tied To

Days Interest
Computed On

Monthly
Payments

Term
“Y” - “Mo”

TOTAL

17.

B&I

Section 9006 Program

Tangible book equity cannot include appraisal surplus or subordinated debt.
May include Proprietorship, Partnership, or other forms of Net Worth

Cash equity injection or fair market value of equity in real proerty that
is to be pledged as collateral for the loan.
Cash equity:
$
Equity in real property:
$
TOTAL EQUITY:
$

When Loan Note Guarantee is issued:
Common Stock
Preferred Stock
Retained Earnings
Capital Surplus

Total Eligible Project Cost

Other *

Equity percentage
(=Total Equity/Total Project Cost)

TOTAL

USDA use:
15% Equity if loan < $600,000
25% Equity if loan > $600,000

8

$
%
OK
OK

ATTACH THE FOLLOWING IF NOT ALREADY SUBMITTED:
18. Intergovernmental Review Clearance (If applicable).
19. Credit reports on the borrower, its principlas, and any parent, affiliate or subsidiary firms.
20. Proposed term Loan Agreement between lender and borrower (See subpart B to 4279, section 4279.161(b)(11) for minimum requirements). For the Section 9006 Program, see §4279.128(b)(2)(xii))
21. Appraisal reports (Submit as soon as available).
22. Lender’s analysis including: spreadsheets of the balance sheets and income statements for 3 years historical, proforma balance
sheet at start up, 2 years projected yearend balance sheets and income statements with appropriate ratios and comparison with
industrial standards (such as D&B, RMA). All data must be shown in total dollars and also in common size form, obtained by
expressing all balance sheet items as a percentage of assets, and all income and expenses as a percentage of sales. The lender’s
credit analysis must address the borrower’s management, repayment ability, history of debt repayment, necessity for any debt
refinancing, and the credit reports on the borrower, its principals, and any parent, affiliate or subsidiary firms.
GENERAL LENDER CERTIFICATION
Lender certifies that it has reviewed the General Lender Certifications contained in this application. Lender’s signature represents
the
lending institution’s agreement to comply with the limitations outlined in the General Lender Certifications.
Lender institution certifies that it meets all criteria to be considered as an Eligible Lender.
Lender certifies that it has completed a comprehensive analysis of the proposal, the proposed borrower is eligible, the loan is for authorized
purposes, and there is reasonable assurance of repayment ability based on the proposed borrower’s history, projections, equity, and the
collateral to be obtained.

Lender’s Name

Date

By:
Officer Signature

Officer Title

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GENERAL LENDER CERTIFICATIONS
LENDER ______________________________________
(1) RESTRICTIONS AND DISCLOSURE OF LOBBYING ACTIVITIES
If any funds have been or will be paid to any person for influencing or attempting to influence an officer or employee of any agency,
a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this
commitment providing for the United States to guarantee a loan, the undersigned shall complete and submit Standard Form-LLL,
“Disclosure of Lobbying Activities,” in accordance with its instructions.
Submission of this statement is a prerequisite for making or entering into this transaction imposed by §3017.510, Participants’
responsibilities. The regulations were published as part IV of the January 30, 1989, Federal Register (pages 4722-4733). Copies of the
regulations may be obtained by contacting the Department of Agriculture agency offering the proposed covered transaction.
(2) CERTIFICATION REGARDING DEBARMENT, SUSPENSION, AND OTHER RESPONSIBILITY MATTERS - PRIMARY
COVERED TRANSACTIONS
This certification is required by the regulations implementing Executive Order 12649, Debarment and Suspension, 7 C.F.R. §3017.510,
Participants’ responsibilities. The regulations were published as part IV of the January 30, 1989, Federal Register (pages 4722-4733).
Copies of the regulations may be obtained by contacting the Department of Agriculture agency offering the proposed covered
transaction.
The inability of a person to provide the certification required below will not necessarily result in denial of participation in this covered
transaction. The prospective participant shall submit an explanation of why it cannot provide the certification set out on this form.
The certification or explanation will be considered in connection with the department or agency’s determination whether to enter into
this transaction. However, failure of the prospective primary participant to furnish a certification or an explanation shall disquailify
such person from participation in this transaction.
The certification in this clause is a material representation of fact upon which reliance was placed when the department or agency
determined to enter into this transaction. If it is later determined that the propective primary participant knowingly rendered an
erroneous certification, in addition to other remidies available to the Federal Government, the department or agency may terminate this
transaction for cause.
The terms “covered transaction,” “debarred,” “suspended,” “ineligible,” “lower tier covered transaction,” “participant,” “person,”
“primary covered transaction,” “principal,” and “voluntarily excluded,” as used in this clause, have the meanings set out in Definitions and Coverage sections of rules implementing Excutive Order 12649. You may contact the person to which this proposal is
submitted for assistance in obtaining a copy of those regulations.
The prospective primary participant agrees by submitting this form that, should the proposed covered transaction be entered into, it
shall not knowingly enter into a lower tier covered transaction with a person who is debarred, suspended, ineligible, or voluntarily
excluded from participation in this covered transaction, unless authorized by the department or agency entering into this transaction.
The prospective primary particpant further agrees by submitting this form that it will include the clause titled “Certification Regarding
Debarment, Suspension, Ineligibility and Voluntary Exclusion - Lower Tiered Transactions, provided by the department or agency
entering into this covered transaction, without modification, in all lower tier covered transactions and in all soliciations for lower
tier covered transactions.
A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that
is not debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it knows that the certification
is erroneous. A participant may decide the method and frequency by which it determines the eligibility of its principals. Each
participant may, but is not required to, check the Non-procurement List.
Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in good faith
the certification required by this clause. The knowledge and information of a participant is not required to exceed that which is normally
possessed by a prudent person in the ordinary course of business dealings.
Except for transactions authorized under paragraph 5 of this section, if a participant in a covered transaction knowingly enters into a

10

lower tier covered transaction with a person who is suspended, debarred, ineligible, or voluntarily excluded from participation in this
transaction, in addition to other remedies available to the Federal government, the department or agency may terminate this transaction
for cause or default.
(A)

The prospective primary participant certifies to the best of its knowledge and belief, that it and its principals:
(1) are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from covered
transactions by any Federal department or agency;
(2) have not within a three-year period preceding this proposal been convicted of or had a civil judgement rendered against them for
commission of a fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public
offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State, or local) transaction
or contract under a public transaction; violation of Federal, or State antitrust statutes or commission of embezzlement, theft,
forgery, bribery, falsification or destruction of records, making false statement, or receiving stolen property;
(3) are not presently indicated for or otherwise criminally or civilly charged by a government entity (Federal, State, or local)
with commission of any of the offenses enumerated in paragraph A.2. of this certification; and
(4) have not within a three-year period preceding this applicaion or proposal had one or more public transactions (Federal, State,
or local) terminated for cause or default.

(B)

Where the prospective primary participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal.

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