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ITEM 5. <br /> A. T <br /> ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY <br /> MEMORANDUM <br /> TO: Economic Development Authority <br /> FROM: Marc Nevinski,Assistant Director of <br /> /y, <br /> Economic Development <br /> eV <br /> DATE: October 11, 1999 <br /> SUBJECT: Micro Loan Request: ProTech <br /> Engineering- Brad Butalla & John House <br /> Issue <br /> Brad Butalla and John House have requested a Supplemental Micro Loan of <br /> $50,000 to assist in the start-up of their new company, ProTech Engineering. <br /> Dollars from.the Micro Loan Fund and several financial institutions will be <br /> used for the purchase of mold making equipment. The company has a four year <br /> agreement to lease a 5,000 square foot bay in the Decker Building on East <br /> Highway 10. ProTech plans to employ four people within two years. <br /> di Background <br /> ProTech Engineering will make molds used in the plastic injection molding <br /> process. Mr. Butalla stated that the industry trend is moving towards a shorter <br /> turn-around time of six to eight weeks while maintaining high tolerances. This <br /> is accomplished using the latest technology to manufacture the molds. At this <br /> time, few companies have such technology and ProTech plans to establish itself <br /> in the market using the latest equipment to keep pace with the industry trend. <br /> Initially ProTech will be a sub-contractor for other mold makers, but the <br /> company intends for its primary customer base to eventually be comprised of <br /> original equipment manufacturers. Several companies have already expressed <br /> in writing an interest in retaining ProTech's services. <br /> Financing for the project will come from a variety sources. Five year loans from <br /> the following asset lenders have been secured. The interest rates are fixed from <br /> 9.25% to 10.25% and the loans are amortized for the full term. <br /> Loans RP Capital $ 124,720 <br /> Copelco Capital $ 114,086 <br /> Center Capital $ 91,270 <br /> Intech Funding Corp $ 155,000 <br /> • Micro Loan $ 50,000 <br /> Equity Investor Contribution $ 65,000 <br /> Owner Contribution $ 45,000 <br /> Total $ 645,076 <br /> 13065 Orono Parkway • P. O. Box 490 • Elk River, MN 55330-1743 • (612) 441-7420 • Fax (612) 441-7425 <br /> Equal Opportunity Housing and Equal Opportunity Employment <br />