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ITEM # 6. <br />REQUEST FO R ACTIO N <br />ver <br />To Item Number <br />Economic Development Authority <br />Agenda Section Meeting Date Prepared by <br /> August 11, 2008 Catherine Mehelich, Director of <br /> Economic Develo ment <br />Item Description Reviewed by <br />Consider EDA Micro Loan Applications <br />- Pomeroy Tool, Inc. Reviewed by <br />- Ethanol Technology of Minnesota, LLC <br />Action Requested <br />The EDA is asked to consider the EDA Finance Committee's recommendation for approval with <br />conditions on the following Micro Loan applications: <br />1) $100,000 Micro Loan to Pomeroy Tool, Inc. (Long &Quyen, Inc.) <br />2) $74,000 Micro Loan to Ethanol Technology of Minnesota, LLC <br />Background/Discussion <br />The attached staff reports to the EDA Finance Committee and August 6, 2008 committee meeting <br />minutes provide background regarding the two separate Micro Loan requests. A representative from <br />each of the applicants is anticipated to be at the EDA meeting to respond to any questions about the <br />proposed projects. <br />Financial Impact <br />The Micro Loan Fund has a current cash balance of approximately $970,360 (including $100,000 Micro <br />Loan committed for issuance to Sportech, Inc.). <br />The Finance Committee is recommending EDA approval of the following Micro Loans and terms: <br />Applicant: Ethanol Technology of Minnesota, LLC <br />Loan Terms: $74,000 at 3% interest, 10-year amortization; 5-year balloon payrrlent <br />Purpose: Purchase equipment and complete remodeling for expanded business venture <br />Security: 2°d position lien on equipment, inventory, accounts receivable, real estate <br />& personal guarantee <br />Job/Wage Goals: Create 7 full-time positions at wages not less than $15/hour within 2-years <br />Applicant: Pomeroy Tool, Inc. (Long &Quyen, Inc.) <br />Loan Terms: $100,000 at 3% interest, 10-year amortization 5-year balloon payment <br />Purpose: Purchase existing precision machining business and continue operations in Elk River <br />Security: Priority position on accounts receivable, personal guarantee and life insurance <br />Job/Wage Goals: Retain 4 full-time positions and create 2 full-time positions at wages not less than <br />$15/hour within 2-pears. <br />S:\EDA\Micro Loan Fund\Finance Committee\2008\8.11.08 EDA Action Requested.doc <br />