6.1. HANDOUT EDA 05-19-2014 - Laserfiche WebLink

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r INITIATIVE FOUNDATION LOAN PROGRAM GUIDELINES: Lender Match Loan Program 6 r�e rt PROGRAM DESCRIPTION <"n Under the Lender Match loan program, the Initiative Foundation provides crucial capital to eligible businesses that minimizes the out of pocket cash outlay otherwise needed for a down m payment on the purchase of equipment or real estate,and thereby preserves precious rt working capital. The Initiative Foundation provides up to $50,000 of subordinated financing to match the senior financing provided by a financial institution issued under its standard loan policy guidelines. The combined financing of both loans may not exceed 100% of the total financing package or value of assets. In most cases, the Initiative Foundation will make a final decision on credit requests within three to five business days, based on information <s provided by the financial institution. G; N O TYPES OF BUSINESS ELIGIBLE The targeted sectors for the program are manufacturing, technology,wholesale, and other j3 businesses,which contribute to the economic base of central Minnesota through the provision of existing and new employment opportunities. Financing for startup entities and nonprofit organizations may qualify. Generally, retail and personal service businesses do not qualify. COLLATERAL AND GUARANTEES The collateral for an Initiative Foundation loan generally consists of a sole second priority interest in the fixed assets to be acquired, along with a subordinated general security interest in all assets of the borrower. Collateral coverage may not exceed 100% of the cost of the assets to be acquired through financing. Personal guarantees from all primary owners of the business are required. PROGRAM LENDING GUIDELINES • Initiative Foundation Loan: Up to a maximum of$50,000. This loan is originated and serviced by the Initiative Foundation. • Origination Fee: The borrower will pay a one percent origination fee,and other third party expenses such as loan document preparation and any related filing fees. • Financial Institution Loan: Must be equal to or greater than the Initiative Foundation loan,and issued according to the institution's loan policy for debt service coverage and collateral. • Maximum Size of Loan: Typically, combined loans are equivalent to the amount of the assets being acquired. This normally includes only hard costs for the purchase or other assets,but does not include applicable taxes,shipping, set-up,training, or other incidental costs. 6�''��v3k'a"l '�: 1'i'i1•n Equal cppnrtuniry 1�nrL�i providt r and omployer