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ELK RIVER ECONOMIC DEVELOPMENT AUTHQTY <br /> MEMORANDUM <br /> TO: Elk River Economic Development Authority <br /> FROM: Marc Nevinski, Assistant Director of <br /> Economic Development <br /> DATE: December 11, 2000 <br /> SUBJECT: Subordination Request - ProTech Engineering <br /> Micro Loan <br /> Issue <br /> The Bank of Elk River is requesting that the EDA subordinate its first position on <br /> ProTech Engineering's accounts payable as collateral on a $25,000 line of credit. <br /> Background <br /> In November of 1999, ProTech Engineering, a startup mold manufacturer, received a <br /> • <br /> $50,000 Micro Loan from the EDA to purchase machinery and equipment. To date, <br /> the company, located in the Decker Building,has hired two full time employees as <br /> well as a parttime position. The company has also met its sales goal for the year of <br /> $500,000. The loan repayment history is excellent. <br /> To ensure the EDA's collateral position, staff filed a blanket UCC-1at the time of the <br /> loan and holds a first position on the company's accounts, inventory, documents, <br /> fixtures and the like, along with a second position on four pieces of equipment. <br /> Action Requested <br /> Staff recommends that the EDA consider approving the request by The Bank of Elk <br /> River to subordinate its first position on ProTech Engineering's accounts receivable. <br /> 13065 Orono Parkway • P. 0. Box 490 • Elk River, MN 55330-1743 • (612) 441-7420 • Fax (612) 441-7425 <br /> Equal Opportunity Housing and Equal Opportunity Employment <br />