[Code of Federal Regulations]

[Title 13, Volume 1]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 13CFR123.303]



[Page 353]

 

                TITLE 13--BUSINESS CREDIT AND ASSISTANCE

 

                CHAPTER I--SMALL BUSINESS ADMINISTRATION

 

PART 123_DISASTER LOAN PROGRAM--Table of Contents

 

                Subpart D_Economic Injury Disaster Loans

 

Sec. 123.303  How can my business spend my economic injury disaster loan?



    (a) You can only use the loan proceeds for working capital necessary 

to carry your concern until resumption of normal operations and for 

expenditures necessary to alleviate the specific economic injury, but 

not to exceed that which the business could have provided had the injury 

not occurred.

    (b) Loan proceeds may not be used to:

    (1) Refinance indebtedness which you incurred prior to the disaster 

event;

    (2) Make payments on loans owned by another federal agency 

(including SBA) or a Small Business Investment Company licensed under 

the Small Business Investment Act;

    (3) Pay, directly or indirectly, any obligations resulting from a 

federal, state or local tax penalty as a result of negligence or fraud, 

or any non-tax criminal fine, civil fine, or penalty for non-compliance 

with a law, regulation, or order of a federal, state, regional, or local 

agency or similar matter;

    (4) Repair physical damage; or

    (5) Pay dividends or other disbursements to owners, partners, 

officers or stockholders, except for reasonable remuneration directly 

related to their performance of services for the business.