CHAPTER 159

An Act to amend and reenact § 18.1-147 of the Code of Virginia, relating
to membership in industrial development corporations and loans to
such corporations by its members.
Be it enacted by the General Assembly of Virginia:

1. That § 13.1-147 of the Code of Virginia be amended and reenacted
as follows:

§ 13.1-147. Any financial institution is authorized to become a mem-
ber of a corporation by making application to the board of directors on
such form and in such manner as the board of directors may require and
membership shall become effective upon acceptance of such application by
said board. Membership shall be for the duration of the corporation, pro-
vided, however, that upon written notice given to the corporation two years
in advance, a member may withdraw from membership at the expiration
date of such notice and shall not thereafter be obligated to make any loans
to the corporation.

Each such member shall make loans to the corporation as and when
called upon by it to do so, upon such terms and conditions as shall be
approved from time to time by the board of directors, subject to the fol-
lowing conditions:

(a) All loans shall be evidenced by negotiable instruments of the
corporation and shall bear interest at a rate of not less than one-half of
one per cent in excess of the rate of interest determined by the board of
directors to be the prime rate on unsecured commercial loans as of the
date of the loan.

(b) All loan limits shall be established at the thousand dollar amount
nearest to the amount computed in accordance with the provisions of this
section.

(c) No loan to a development corporation shall be made if immedi-
ately thereafter the total amount of the obligations of the said corpora-
tion would exceed ten times the amount then paid in on its outstanding
capital stock.

(d) The total amount outstanding at any one time on loans to a
development corporation made by any member shall not exceed the fol-
lowing limit, to be determined as of the time such member becomes a
member, on the basis of figures contained in the most recent year-end
statement furnished by such member to State or federal supervisory
authorities, as the case may be: Two per cent of the capital and perma-
nent surplus of banks and trust companies; one-half of one per cent of
the total outstanding loans made by a savings and loan association, or
two hundred fifty thousand dollars, whichever is the lesser; one per cent
of the total outstanding loans made by an industrial loan company; one
per cent of the capital and unassigned surplus of stock insurance com-
panies, except fire insurance companies; one per cent of the unassigned
surplus of mutual insurance companies, except fire insurance companies;
one-tenth of one per cent of the assets of fire insurance companies.

All loan limits shall be recomputed as of the first day of January of
each even-numbered year, but no member’s loan limit shall be increased
as the result of such recomputation without the consent of such member.

(e) Each call for loans made by the corporation shall be prorated
among the members of the corporation in substantially the same propor-
tion that the adjusted loan limit of each member bears to the aggregate
of the adjusted loan limits of all members. The “adjusted loan limit” of
a member shall be the amount of such member’s loan limit, reduced by the
balance of outstanding loans made by such member to the corporation and
the investment of such member in capital stock of the corporation at the
time of such call.

f) A member of a corporation created under this article shall not be
a member of more than one such corporation.

2. An emergency exists and this act is in force from its passage.