Terms definition

The terms used in this project shall have the following meaning:

The Agency – Rural Development Agency;

The Component – one of the following credit categories within the project: Preferential agrocredit for current assets, preferential agrocredit for fixed assets, preferential agroleasing, Produce in Georgia;

The Sub-component – a sub-category of the Component;

Annuity – a form of loan repayment meaning equal payments (principal and interest) in regular intervals;

Irregular schedule – an individually developed loan repayment schedule;

The Beneficiary – a person receiving a material benefit;

The initial loan – a loan issued under the Project before its refinancing;

The Stock – a set of items used for production, processing and realization of products;

Infrastructure – a set of industries serving industrial and agricultural production and providing for normal operation of the system. In the wider sense, it provides for the creation of external conditions of the production process, is a specific economic sphere to serve both production and turnover industries;

Legal Entity – an entity founded in compliance with Law of Georgia on Entrepreneurs;

Term of Credit – a term of the credit is defined in the agreement made by and between a credit issuing finance organization and a person the credit is issued to;

Purpose of Credit – a purpose of the loan defined by a specific component/subcomponent;

Secondary Security – a security of the loan, which is used as alternative repayment of the loan in case of an outstanding liability, remained after the use of the primary security;

The Borrower – a natural person or legal entity who takes a loan;

Parallel Loan – one or more loans to be repaid by a single borrower as part of one component or sub-component;

Current Asset – the current asset, which may be converted to cash during one operational cycle;

Fixed Asset – the material asset used by a person for producing goods, delivering goods/providing services, renting (including leasing) or/and administrative purposes and a term of useful use of which is more than one year;

Interest Rate – an interest rate to be accrued to the principal amount of the loan as determined by a finance institution;

Finance Institution – commercial banks registered in Georgia, which participate in the Project;

Grace Period – a period, during which a borrower is not obliged to pay an interest accrued to the principal amount of the loan or/and a principal amount of the loan;

Loan/Credit – a cash issued by a finance institution under the Project with a pre-defined interest rate, term and purpose;

Loan (service) fee – a tariff established by a finance institution to be paid by the borrower for the services related to loan issue;

Purpose loan co-financing – purpose funds paid by the Agency as part of the Project;

Loan Repayment Schedule – a schedule of payment of the principal as well as interest accrued thereto in the pre-defined size and regularity;

Loan re-financing – a whole or partial repayment by a single person of his/her current loan through a new loan issued by the same or any other finance institution;

Security – any property offered by the borrower and acceptable to the finance institution, which in case of selling will reimburse the finance institution any losses incurred by it in result of unpaid loan;

Natural Person – a capable citizen of Georgia;

Primary Agricultural Enterprise – an enterprise occupied with primary agricultural production;

Restructuring – amending a loan/leasing repayment schedule, including through refinancing (any change to the interest rate on the loan is not considered restructuring);

Leasing – transferring certain property by a lessor to a lessee for use for a period defined in the respective agreement, with the right or without the right to purchase this property, in the regularity agreed by the lessor and the lessee, in exchange of certain payment, as per Article 576 of the Georgian Civil Code;

Lessor – a leasing company participating in the Project, the Agency will conclude a respective agreement with;

Lessee – a natural person - citizen of Georgia, an individual entrepreneur or entrepreneur legal entity registered in compliance with Georgian legislation, who is a lessor under the lease agreement signed with a leasing company and who meets the preferential agroleasing requirements;

Lease Agreement – a lease agreement made by and between a lessor and a lessee;

Subject of Leasing – a property transferred by a lessor to a lessee under the lease agreement signed by them;

Term of Leasing – a term agreed by a lessor and a lessee during which a lessor transfers a subject of leasing to a lessee;

Cost of the Subject of Leasing – a cost of the subject of leasing agreed by the lessor and the lessee in the lease agreement;

Participation of the Lessee – a sum paid in advance by the lessee from the cost of the subject of leasing;

Investment by the Lessor – the part of the cost of the subject of leasing financed by the Lessor, an annual interest will be accrued to;

Leasing Payment – any sums to be paid periodically by the Lessee according to the Leasing Agreement Schedule;

Accrued Interest – an annual interest accrued to the Lessor’s investments;

Purpose Lease Co-financing – a leasing payment co-financing sum to be paid by the Agency to the Lessee;

Co-finance Project – “Project of Co-financing of the Agricultural Product Processing and Storing Enterprises”;

Season – an annual time interval as defined by a respective sub-component.

State Enterprise – an enterprise founded in compliance with Law of Georgia on Entrepreneurs, 50% or more of shares of which are owned by the State;

Municipal Enterprise – an enterprise founded in compliance with Law of Georgia on Entrepreneurs, 50% or more of shares of which are owned by the Muncipality;

State Affiliated Enterprise – a daughter enterprise of a state, municipal company or of a company of the Autonomous Republic of Adjara; enterprises financed, directly or indirectly, through the budget funds of the state, municipality or Autonomous Republic of Adjara; enterprises financed by non-entrepreneurial (non-commercial) legal entities; also, state, municipal enterprises and those of Autonomous Republic of Adjara that are transferred to the third parties with the right of management;

Parallel Agroleasing – two or more agroleases under one component or sub-component unrepaid by a lessee;

Floating (variable) Interest Rate – an interest rate on the loan, which varies periodically over the lifetime of the loan. The interest rate consists of two parts: a base rate subject to changes with market conditions (in this case – a refinance rate) and an addition that is a fixed value;

Fixed Interest Rate – an interest rate on the loan, which is constant over the lifetime of the loan;

Refinance Rate – a main instrument of the monetary-credit policy of the National Bank and a kind of reference point for monetary market rates;

Co-finance Agreement – a purpose co-finance agreement made as part of the Project between the Agency and the Beneficiary or the Agency, Beneficiary and Financial Institution.