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¥1. <br /> <br />· Business must be a for-profit corporation, partnership, or sole <br /> proprietorship. <br />· Business must be a sma//business as defined by the Small Business <br /> Admimstradon (SBA). <br />· Business must have a positive net worth. <br />· Reli~ous, polidcal, and pornograpl~ic enterprises are not eligible to use <br /> the ]Economic Development Micro Loan Fund. <br /> <br />MICRO LOAN FUND TERMS & CONDITIONS <br /> <br />1. Loan Structure <br />All EDA Micro Loans will be structured as flartidjOation loans and will be serviced by <br />the project's primary lending institution. Such an arrangement allows for the central <br />distribution and collection of funds and sh,nplifies the financing process for all <br />parties involved. A participation agreement will be signed by the borrower, prkmary <br />lender and the EDA. The EDA may require additional agreements to be signed by <br />fl:e borrower (i.e. securi~, a~eement, personal gmarantees, job performance <br />agreement). <br /> <br />2. Simultaneous Micro Loans <br />The simultaneous use of different Micro Loan Fund Programs by any one borrower <br />or for any one project is prokibited. <br /> <br />3. Call of Loan <br />A loan shall become due and payable in full if a business relocates outside of the city <br />of Elk River prior to the matuhty date of the EDA loan. <br /> <br />4. Late Payment Charge <br />A late payment charge of up to 8% of the installment amount may be enforced. <br /> <br />REGULATION FOR NEW CONSTRUCTION AND IMPROVEMENTS <br /> <br />All buildings wkich public funds will be used for construction or renovation are to <br />be brought into confomqance with city codes and policies. Repairs may include the <br />following systems and portions of real property: <br />a. Mechanical heating, plumbing, and electrical <br />b. Structural; including the facade of the structure and ener~, related <br /> improvements. <br />c. Hook-up to city set,rices (i.e. water, sewer) <br /> <br />VII. LOAN SECURITY AND GUARANTEES <br /> <br />Applicant must be able to secure the loan by proxdding the EDA with a minimum of <br />a subordinate mortg-age upon the building and/or assets or other approved collateral. <br /> <br />Applicant must demonstrate the financial means to repay the loans, as determined by <br />the Economic Development Authority. <br /> <br />Whenever possible, personal guarantees will be made part of any loan ag'reement. <br /> <br />Elk River Economic Development Aufl~ont3, <br />Micro Loan Fund Policy & Guidelines <br /> <br />Page 5 of 8 <br /> <br /> <br />