The secondary guarantee component for Current Assets

1. This component provides for the secondary collateral on revolving loans issued by financial institutions for livestock farming of breeding breeds and primary hazelnut production.
2. For each new (non-refinanced/non-restructured) loan issued within the component, secondary collateral for up to 50% of the total principal amount of the loan will be provided by the Agency within 18 months following the issuance of the loan or its first tranche, provided that the loan is initially secured by at least 30%. Secondary collateral will be provided to the financial institution if the borrower fails to fulfill their obligations and the financial institution realizes the primary collateral and is unable to recover 100% of the remaining principal amount. The Agency will cover the difference, but no more than 50% of the principal amount existing prior to the realization of the primary collateral, and not exceeding 300,000 GEL.

3. Secondary collateral will only be provided after the program participant presents an audit report confirming the targeted use of the loan.

4. The following individuals can benefit frompreferential agrocredit within the component:

   a) A Georgian citizen, an individual;

   b) An individual entrepreneur registered under Georgian law;

   c) A legal entity registered under Georgian law (except for state/municipal enterprises).

      5. In order for a potential beneficiary to benefit from preferential agrocredit, they must meet the preconditions for issuing such loans established by the financial institution and the requirements of the present project:

a) The participant must be registered in the registry established under the "Farm/Farmer Registration Project";

b) The farm and/or land plot where the specified purpose is planned to be carried out must be owned, co-owned, or leased by the borrower in accordance with Georgian legislation (in the case of co-ownership, consent from the co-owners for the use of the property during the loan period must exist, and in the case of leasing, the lease term must not be shorter than the loan term).

6. Loans within the component are issued for the following purposes:

a) To finance revolving funds for livestock farming of breeding breeds:

a.a) The purchase of non-breeding and young livestock (both imported and locally);

a.b) Financing current costs for livestock feed;

a.c) Financing current veterinary costs for livestock;

a.d) Financing labor resources and veterinary services.

b) To finance revolving funds for primary hazelnut production:

b.a) Financing current costs for pesticides, organic and mineral fertilizers, and biological plant protection products;

b.b) Financing the rental of labor resources and agricultural machinery for agricultural work;

b.c) Financing current costs for fuel and lubricants used for agricultural machinery.