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6.0. HRSR 04-11-2005 Item 6. II City of Elk -� River MEMORANDUM TO: Economic Development Authority FROM: Catherine Mehelich, Director of Economic Development DATE: April I I, 2005 SUBJECT: Consider Micro Loan Policy Waiver for Badger Ventures, LLC (Gradient Technology) Attachments • Participation and Subordination Agreement between the Economic Development Authority for the City of Elk River and The Bank of Elk River • Economic Development Micro Loan Fund Policy • Background In June 2004 the EDA awarded a $100,000 Micro Loan to Badger Ventures,LLC (Gradient Technology) in addition to $145,556 in tax abatement (tax rebate) assistance from the City and County for the construction of a 13,000 square foot building in the Elk River Business Park. The loan, subject to recent amendments to the EDA's Micro Loan Policy,will be structured as a participation loan with The Bank of Elk River. A participation loan allows for the central distributions and collection of funds by the project's primary lending institution. Issue In order to finalize the participation loan, a Participation and Subordination Agreement has been prepared by the bank outlining the terms of the EDA's interest in the loan. Staff has reached agreement with the bank on the attached Participation Agreement;however a section of the Agreement is inconsistent with a requirement in the EDA's recently amended Micro Loan Policy. Staff is requesting that the EDA consider waiver of a particular policy provision in this case. Analysis In June 2004 the EDA amended the Micro Loan policy to include the following provision under Section V. Micro Loan Fund Terms &Conditions, Item 1) Loan Structure: • Badger Ventures,LLC Micro Loan EDA Meeting April 11,2005 Page 2 of 2 "The participation agreement shall include the provision that if the borrower defaults on the • loan, the EDA will collect all further payments during the default based on a pro rata basis with the participating bank, excluding the distribution of proceeds resulting from the foreclosure on collateral." The provision was added with the intent that if a company were to get behind in loan payments that the payments would be distributed on a pro rated basis. The Badger Ventures,LLC participation loan is being structured whereas tax rebate payments, as provided from the City to The Bank of Elk River through an Assignment, would be dedicated to the payment of the EDA Micro Loan. The Bank has agreed that all collections of tax rebates will be remitted to the EDA. Paragraph 4 of the Agreement further indicates that under an event of default any proceeds other than tax rebates may be applied on a pro rata basis. At the time of the Micro Loan Policy amendments the EDA did not contemplate a situation where the EDA could be senior with respect to tax rebate collections and subordinate with respect to other collections. In this case that structure appears to provide the EDA adequate protection that its portion of the loan will have a sufficient source of revenue to cause it to be repaid. Requested Action Staff recommends that the EDA and Council approve a waiver from this provision of the • Micro Loan Policy for the Badger Ventures,LLC Micro Loan. PARTICIPATION AND SUBORDINATION AGREEMENT THIS AGREEMENT is made as of , 2005,by and between the Economic Development Authority for the City of Elk River, a public body corporate and politic, or its assigns (the"Purchaser"), and The Bank of Elk River,Minnesota banking corporation(the "Seller"). The Seller has provided, inter alia, a loan in the amount of$977,500.00 (hereafter the "Loan") to Badger Ventures, LLC, a Minnesota limited liability company(hereafter the "Borrower"). The Loan was memorialized in a Loan Agreement dated July 8, 2004,Note A and Mortgage A in the amount of$877,500.00, and Note B and Mortgage B in the amount of $100,000.00. Mortgage A secures performance under Note A, and Mortgage B secures performance under Note B. The Seller desires to sell and the Purchaser desires to purchase an interest in Note B as set forth in this Agreement. In consideration of the foregoing and the mutual agreements set forth herein,the Seller and the Purchaser agree as follows: 1. The Seller hereby sells and the Purchaser hereby purchases, without recourse to the Seller, a 100%participation in Note B, in exchange for$100,000.00. Purchaser shall have the benefit of subordinate security as stated in Mortgage B. Seller retains all rights under Note A and Mortgage A. • 2. In this Agreement, "Collections"means all payments received by the Seller on account of the Loan, including without limitation payments to the Seller by the Borrower or any guarantor,payments received by the Seller by means of setoff, and net proceeds of any security received by the Seller. The Seller shall receive all Collections of principal, interest and other charges, fees and expenses on the Loan. Notwithstanding paragraph 4 hereof, all Collections by Seller under an Assignment of Tax Rebates shall be remitted to the Purchaser promptly. 3. Purchaser has purchased Note B and is entitled to the secondary and subordinate Mortgage B as security. Purchaser shall also be entitled to the benefit of the Guaranties, Assignments of Rent and other security devices (other than Mortgage A),but Purchaser's interests and rights shall always be second and subordinate to Seller's interests and rights. Purchaser agrees not to exercise or enforce these interests or rights against any entity or person liable for payment of the indebtedness,unless and until all indebtedness owing to Seller under the Loan Agreement,Note A, and Mortgage A shall be been fully paid. 4. Other than tax rebates, at the Seller's discretion, any proceeds other than tax rebates, received by the Seller on account of the Loan or any such other extension of credit after the occurrence of an Event of Default, and any proceeds received by the Seller from any such • security after the occurrence of an Event of Default, and any payments received from any • guarantor after the occurrence of an Event of Default,may be applied by the Seller to either entirely to Note A or alternatively to Note B and such other extensions of credit on a pro rata basis in proportion to the then unpaid principal balances of the Loan and such other extensions of credit. In this Agreement, "Event of Default"means an Event of Default under the Loan Agreement that is not waived or cured. 5. The Seller shall hold the Loan Agreement,the Notes, and all security instruments, guaranties and other writings concerning the Loan, and shall maintain records pertaining to the Loan. At all reasonable times, the Seller shall permit the Purchaser to inspect and copy such writings and records. At the Purchaser's request from time to time, the Seller shall provide the Purchaser with available financial and nonfinancial information on the Borrower and any guarantors of the Loan, including without limitation accrual status, status of principal and interest payments, available financial statements,collateral values and lien status, and any available information bearing on the continuing creditworthiness of the Borrower and any guarantors of the Loan. The Seller may administer the Loan and any security and guaranties therefor as though it were the sole owner and holder thereof. Notwithstanding the foregoing,the Seller shall not,without the prior written consent of the Purchaser: (a) forgive any principal or interest under Note B; or(b) agree to any extension of the maturity date of the Note B; or(c) agree to the release,substitution or exchange of any security for or guaranty of Note B. 6. All expenses of administration of the Loan, including without limitation all advances for preservation of security, expenses of collection, enforcement, foreclosure and sale, • attorneys' fees, court costs and disbursements, shall be paid by the Seller, in its discretion, and added to the principal amount of Note A. 7. If all or any portion of any payment or recovery under the Loan Agreement,Note B, or any guaranty or security is recovered from the Seller by the Borrower, any trustee in bankruptcy or debtor in possession, or any other person or entity following the Seller's payment to the Purchaser, the Purchaser shall thereupon return and pay over to the Seller an amount equal to the payment to the Purchaser which has been recovered from the Seller,together with any interest thereon which the Seller is required to pay in connection therewith. 8. The Purchaser acknowledges that it has made an independent investigation of, and has satisfied itself with respect to,the credit standing of the Borrower and any guarantor of the Loan, the value of any security for the Loan, the validity and enforceability of the Loan Agreement,Note B and Mortgage B and any guaranty and security and all other matters in connection with the Loan, that the Purchaser is not relying upon the Seller's judgment. Seller makes no warranty of any kind, express or implied, in connection with the Loan or any of the foregoing. • 9. Neither the Purchaser nor the Seller may sell,pledge, assign, sub-participate, or • otherwise transfer its interest in the Note B or any security or guaranty therefor without the prior written consent of the other party, except that the Seller may sell other participations in Note A. 10. The Purchaser consents to the personal jurisdiction of the state and federal courts located in the State of Minnesota in connection with any controversy related to this Agreement or any transaction relating to this Agreement,waives any argument that venue in such forums is not convenient, and agrees that any litigation initiated by the Purchaser against the Seller in connection with this Agreement or any transaction relating to this Agreement shall be venued in either the District Court of Sherburne County, Minnesota, or the United States District Court, District of Minnesota, Fourth Division. 11. The Seller agrees to pay to the Purchaser, and the Purchaser agrees to pay to the Seller, interest on any past due amount payable by such party under this Agreement, at the interbank federal funds rate in effect from time to time. The Seller shall not be liable to the Purchaser for any action taken or omitted or for any error in judgment, except for bad faith or willful misconduct. The Seller has no fiduciary or trust relationship with the Purchaser in connection with this Agreement or the Loan. Nothing contained herein shall be deemed to prohibit or restrict the right of the Seller, in its discretion, to extend additional credit to the Borrower, any guarantor or any other person and to demand and receive payment therefor. This Agreement constitutes the entire agreement and understanding of the Seller and the Purchaser with respect to the subject matter hereof, shall bind and benefit the Seller and the Purchaser and their respective successors and assigns, and cannot be amended, enlarged, altered, supplemented, • abridged, modified,nor any provision waived, except by a writing duly signed by the Seller and the Purchaser. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Minnesota. 12. Upon written request from the Purchaser, the Seller will furnish to the Purchaser a copy of Note A, the Loan documents, and all financial statements issued by the Borrower in conformity with the Loan documents. The Seller shall give the Purchaser notice of any default in any payment of principal or interest on the Loan or any acceleration of the maturity of the Loan; any material change in the Loan documents; or any Event of Default communicated to the Borrower or communicated by such Borrower to an officer of the Seller responsible for the relationship with the Borrower. The failure to provide notices of default to Purchaser shall not allow Purchaser any remedy or in any way alter Seller's rights or remedies. 13. Seller is hereby granted full power and authority to determine that the conditions to making the Loan have been met and, in connection with such Loan, to waive the performance of obligations of the Borrower or to excuse the nonoccurrence of conditions; to exercise collection rights with respect to any Collateral,to foreclose against any Collateral or to accept a transfer in lieu of foreclosure; to collect and receive any and all payments, collections and proceeds of Collateral made or delivered by or for • the account of the Borrower and at its sole discretion to release such payments, collections and proceeds to the Borrower or apply the same to the payment of indebtedness; to enforce rights against third parties; and otherwise to do and refrain from doing any and all acts and things which it would be required or permitted to do or refrain from doing under or with respect to the loan documents as fully as if it had retained its entire interest as lender under the loan documents,but acting on behalf of Purchaser. Executed as of the date first above written. ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF ELK RIVER By: Catherine Mehelich Title: Executive Director THE BANK OF ELK RIVER • By: Tom McNair Its: Vice President • \004 City ofEllc +^r�■rte•. Ri' ver The Light Industrial Hub of the Northwest Metro Economic Development Micro Loan Fund Policy & Guidelines And Application Revised: June 2004 September 1999 Economic Development Authority for the City of Elk River 13065 Orono Parkway Elk River,MN 55330 (763) 635-1040 ELK RIVER ECONOMIC DEVELOPMENT MICRO LOAN FUND POLICY& GUIDELINES Revised June 2004 PURPOSE The Economic Development Authority for the City of Elk River (EDA) recognizes the need to stimulate private sector investment into manufacturing facilities and equipment in order to create new jobs,boost productivity and retain existing jobs for local residents.Additionally, the need exists to encourage investment in the expansion and/or rehabilitation of commercial and retail buildings in order to maintain the economic viability of Elk River's central business district. Subsequently, the purpose of this program is to provide low interest,long-term (i.e. greater than one year) loans as incentives for industrial development within the City of Elk River and to encourage commercial and retail business owners in the central business district to rehabilitate their existing buildings. II. LOAN PROGRAMS In order to meet the economic and community development objectives of the EDA, two distinct loan programs exist within the Micro Loan Fund to promote business growth in Elk River. Industrial Incentive Program Purpose: The purpose of the Industrial Incentive Program is to encourage industrial development that supports the tax base and brings quality jobs to the city. Amount: Up to $100,000 of secondary financing not to exceed 20% of the project cost. Equity: Must have private-sector commitments for 50% of the project cost. Borrower to provide 10% or more of project financing. Rate: Fixed;2 points below the lowest prime rate published in the Wall Street Journal the day the loan is closed, or 3%,whichever is greater. Term: Financing with a balloon payment in up to 5-years. The balloon payment must not be longer than the balloon payment of the participating bank. Loans may be amortized up to the following limits: 15-years on real estate uses; 10-years on equipment uses. • Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 2 of 8 Extension: In the event that the Borrower is unable to obtain conventional financing to replace the Micro Loan at the end of five years, the loan may be extended up to two additional years at a market rate of interest. Criteria: 1. Borrower must be an industrial firm and create one new full-time job for each$20,000 loaned within 2 years. Said jobs must pay a minimum wage of$10.00 per hour plus benefits. Loans in excess of$75,000 shall meet the City's Business Subsidy Policy for new job and wage goals, as well as location requirements. 2. Borrower must comply with the provisions of the city's industrial and business park zoning ordinances. Redevelopment Financing Program Purpose: The Redevelopment Financing Program is available to business and property owners in the central business district (CBD) for the rehabilitation and restoration of their buildings. Amount: Up to $50,000 of secondary financing (not to exceed 40% of the project cost. Equity: Must have private-sector commitments for 50% of the project cost. Borrower to provide 10% or more of project financing. • Rate: Fixed;2 points below the lowest prime rate published in the Wall Street Journal the day the loan is closed, or 2%,whichever is greater. Term: Financing with a balloon payment in up to 3-years. Loans may be amortized up to the following limits: 15-years on real estate uses; 10-years on equipment uses. Extension: In the event that the Borrower is unable to obtain conventional financing to replace the Micro Loan at the end of three years,the loan may be extended up to two additional years at a market rate of interest. Criteria: 1. At a minimum, 20% of Micro Loan dollars must be used for the improvement of the building's facade. 2. Borrower must be located in the Central Business District (see attached map). III. USES 1. Permitted Fund Uses: • a. Building construction b. Land acquisition Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 3 of 8 c. Machinery d. Furniture, fixtures, and equipment (FF&E) • e. Renovation and modernization of buildings f. Exterior renovation of retail, commercial and industrial buildings g. Public infrastructure needed for economic development expansions h. Investment real estate with a minimum of 50% of the space pre-leased 2. Ineligible Fund Uses: a. Expenditures for the construction and/or renovation of residential units b. Working capital c. Refinancing of existing debt d. Inventory IV. BUSINESSES ELIGIBILITY Any project meeting the above criteria, and located or proposed to be located within the city limits of Elk River as defined by this program,may be eligible for an Economic Development Micro Loan as further defined herein: • Business must be a for-profit corporation,partnership, or sole proprietorship. • Business must be a small business as defined by the Small Business Administration (SBA). • • Business must have a positive net worth. • Religious,political, and pornographic enterprises are not eligible to use • the Economic Development Micro Loan Fund. V. MICRO LOAN FUND TERMS & CONDITIONS 1. Loan Structure All EDA Micro Loans will be structured as participation loans and will be serviced by the project's primary lending institution. Such an arrangement allows for the central distribution and collection of funds and simplifies the financing process for all parties involved.A participation agreement will be signed by the borrower, primary lender and the EDA. The agreement will include the following provisions, among others: • If Borrower does not meet the job and wage goals specified in the Subsidy Agreement, the interest rate will change to 2 points above the participating bank's rate, effective from the two year anniversary of the loan closing. Upon subsequent achievement of the jobs and wage goals, the interest rate will revert back to the rate when the loan was originated, effective from the date of attainment of the job and wage goals. • If Borrower defaults on the loan,the EDA will collect all further payments during the default based on a pro-rata basis with the participating bank excluding the distribution of proceeds resulting from the foreclosure on collateral. • Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 4 of 8 The EDA may require additional agreements to be signed by the borrower (i.e. security agreement,personal guarantees,job performance agreement). • 2. Simultaneous Micro Loans The simultaneous use of different Micro Loan Fund Programs by any one borrower or for any one project is prohibited. 3. Call of Loan A loan shall become due and payable in full if a business relocates outside of the city of Elk River prior to the maturity date of the EDA loan. 4. Late Payment Charge A late payment charge of up to 8% of the installment amount may be enforced. VI. REGULATION FOR NEW CONSTRUCTION AND IMPROVEMENTS All buildings which public funds will be used for construction or renovation are to be brought into conformance with city codes and policies. Repairs may include the following systems and portions of real property: a. Mechanical heating,plumbing, and electrical b. Structural;including the facade of the structure and energy related improvements. c. Hook-up to city services (i.e.water, sewer) VII. LOAN SECURITY AND GUARANTEES • Applicant must be able to secure the loan by providing the EDA with a minimum of a subordinate mortgage upon the building and/or assets or other approved collateral. Applicant must demonstrate the financial means to repay the loans, as determined by the Economic Development Authority. Whenever possible,personal guarantees will be made part of any loan agreement. VIII. TIMING OF PROJECT EXPENSES No project should commence until the Elk River Economic Development Authority has approved the loan application. Any costs incurred prior to the approval of the loan application are generally not eligible expenditures. No building construction should commence until the required City permits are secured. The applicant will be responsible for all legal,recording,and other fees required for protection of a security interest in the loan,payable by a 1%processing fee,which is paid at the time of application. IX. PROCEDURAL GUIDELINES FOR APPLICATION AND APPROVAL • 1. All applicants shall first contact a primary lending institution to determine if additional equity is needed, and if so,how much. Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 5 of 8 2. The applicant and the primary lender shall then meet with City Staff to obtain information about the Micro Loan program, discuss the project, and obtain application forms. 3. The applicant shall complete and submit an application form to the City,along with a processing fee of 1% of the loan request. (The fee is used to cover processing expenses and will be returned if application is denied.) The applicant must provide evidence of their ability to meet the equity requirements or provide a letter of commitment for conventional financing from the primary lending institution. 4. The application will be reviewed by the City staff to determine if it conforms to all City policies and ordinances and to consider the following: a. The availability and applicability of other governmental grants and/or loan programs. b. Whether the proposed project will result in conformance with building and zoning codes. c. Whether it is desirous and in the best interests of the public to provide funding for the project. 5. The EDA Finance Committee and EDA Commissioners will review each application in terms of its consistency with the goals of the Growth Management, Strategic, and Economic Development Plans and in relation to the project's overall impact on the community's economy. Redevelopment Loan • applications will also be reviewed by an HRA member in conjunction with the EDA Finance Committee. They will also evaluate the project application in terms of the following: a. Project Design- Evaluation of project design will include review of proposed activities, time lines and a capacity to implement. b. Financial Feasibility-Availability of funds,private involvement, financial packaging and cost effectiveness. • Appropriate ratio of private funds to Micro Loan funds. • Sufficient cash flow to cover proposed debt service as demonstrated by financial statements and projections. • Business must show a positive net worth. • Letter of Commitment from applicant pledging to complete the project during proposed project duration,if the loan application is approved. • Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 6 of 8 • Letter of Commitment from other financing sources stating terms and conditions of their participation in the project if • applicable. • Sufficient collateral. c. All other information as required in the application and/or additional information as may be requested by the Economic Development Authority. d. Project compliance with all city codes and policies. e. Program Objectives - In addition to quality job and wage creation/retention requirements, the applicant must meet all Micro Loan Fund criteria and demonstrate how the proposed activities will meet at least one of the following objectives: • The project contributes to the fulfillment of the city's approved and adopted economic development and/or redevelopment plans. • The project prevents or eliminates slums and blight. • The project increases the local tax base. • • The project brings a structure into compliance with an existing building code violation. 6. A written request for an extension shall be accompanied by a copy of current financial statements and a$500 upfront processing fee. The processing fee is used to cover processing expenses and will be returned if request is denied. The application for an extension beyond the original term should include a letter of denial from a conventional lender. Refinancing will not be allowed solely for the purpose of reducing the interest rate due to lower market interest rates. 7. The EDA Finance Committee will recommend the approval, denial, or request a resubmission. A recommendation from the Finance Committee will be forwarded to the EDA for final action. X. LOAN POLICY REVIEW The above criteria will be reviewed on an annual basis to ensure that the policies reflected in this document are consistent with the economic development goals set forth by the City. • Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 7 of 8 XI. COMPLIANCE WITH STATE STATUTES Each company receiving assistance in excess of$75,000 from the EDA Micro Loan • Fund shall be subject to the provisions and requirements set forth by Minnesota State Statute 116J.993 and the City's Business Subsidy Policy summarized below: Progress Reports The borrower shall file a report annually for two years after the closing of the loan or until all goals set forth in the application have been meet,which ever is later. Reports shall be completed using the format drafted by the State of Minnesota and shall be filed with the City in March of each year for the previous year. Maintain Facility The borrower agrees to maintain and operate its facility at the site where the loan is used for a period of 5-years after the date the loan is closed. Goal Attainment In addition to attaining or exceeding the jobs and wages goals set forth in Section IV of the Application, the borrower agrees to achieve at least one of the goals for community development set forth in Section IX,part 5, subdivision (e) of the Micro Loan Fund Policy. Redevelopment loans in the Central Business District are exempt from job creation and wage goals stated in Section IX,part 5, subdivision (e) provided the loan amount does not exceed 50% of the project cost. Failure to Comply Businesses failing to comply with the above provisions will be subject to fines, repayment requirements in accordance with the state statute, and be deemed ineligible by the State to receive any loans or grants from public entities for a period of 5-years. XII. RIGHT OF REFUSAL The Elk River Economic Development Authority may deny any project which it deems inappropriate according to the guidelines established in this document. • Elk River Economic Development Authority Micro Loan Fund Policy&Guidelines Revised June 2004 Page 8 of 8 ELK RIVER ECONOMIC DEVELOPMENT MICRO LOAN FUND APPLICATION I. CONTACT INFORMATION Company: Address: City / State / Zip Contact Person(s) Business Phone Fax Home Phone Email Check One: Proprietor Corporation Partnership Social Security No. Federal ID # State ID # • II. NATURE OF LOAN REQUEST Which Micro-Loan Program are you applying for? Industrial Incentive Program Redevelopment Financing Program Amount Requested: $ Total Project Cost: $ Type of project: New construction for a start up business. New construction for an existing business. On site expansion Equipment purchase Remodeling: (circle one)Commercial/ Retail / Industrial Other • Please give a brief summary of your business and its products or service: • Please give a brief summary of the project: Please describe how this loan will impact your project: III. FINANCING Project Costs Land $ • Site improvements $ Buildings (attach plans & costs) $ Equipment/Machinery/Fixtures (attach list and estimated costs) $ Remodeling $ Industrial Inventory/Working Capital $ Other (attach description) $ Total Costs $ Comments: • Elk River Economic Development Authority Micro Loan Fund Application Page 2 of 7 Revised June 2004 Proposed Sources of Financing • SOURCE NAME TERMS AMOUNT Bank Loan $ Bank Loan $ Other Private Funds $ Applicant Contribution $ Other $ Fed Grant/Loan $ State Grant/Loan $ EDA Micro Loan $ Total Financing $ • Collateral Assignments Lien Description of Collateral Position To Bank 1 To Bank 2 To Private Sources To Other Sources To Federal Govt To State To EDA Micro Loan • Elk River Economic Development Authority Micro Loan Fund Application Page 3 of 7 Revised June 2004 Value of Collateral • Book Value Cost Existing Liens Land $ $ $ Buildings $ $ $ Machinery&Equip. $ $ $ Other $ $ $ Other $ $ $ IV. JOB & WAGE GOALS Present# of Employees Total Payroll Jobs To Be Created* Please provide the following information on jobs you expect to create. Average Are the Jobs Expected Number Hourly Annual Permanent or Hiring • Job Title of Jobs Wage Salary Temporary? Date *If loan is for job retention only,please explain in Business Plan. Job Creation Timetable In conjunction with the Micro Loan,job and wage goals will be expected within two years. Please indicate on the table below when the above listed individual jobs will be created. Number Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Qtr. Job Title of Jobs 1 2 3 4 5 6 7 8 Elk River Economic Development Authority Micro Loan Fund Application Page 4 of 7 Revised June 2004 IV. PROJECT CONTACTS Attorney • Name Address Phone Accountant Name Address Phone Financing Sources (lenders,partners, etc...) Name Address Phone Name • Address Phone Name Address Phone Name Address Phone Parent Company Name Address Phone • Elk River Economic Development Authority Micro Loan Fund Application Page 5 of 7 Revised June 2004 • Others Name • Address Phone Name Address Phone V. ATTACHMENTS CHECK LIST Please attach the following: A) Written Business Plan: 1. Description of Business 2. Ownership 3. Management 4. Date Established 5. Products/Services 6. Future Plans • B) Financial Statements for Past Two Years C) Financial Projections for Two Years D) Resume of Owner/Management E) Personal Financial Statements of Proprietor,Partners, Guarantors F) Letter of Commitment from Applicant Pledging to Complete During the Proposed Project Duration G) Letter of Commitment from the Other Sources of Financing, Stating Terms and Conditions of their Participation in Project H) Other I) Other • J) Fee (1% of amount of loan request). Elk River Economic Development Authority Micro Loan Fund Application Page 6 of 7 Revised June 2004 VI. AGREEMENT • I /We certify that all information provided in this application is true and correct to the best of my/our knowledge. I /We authorize the City of Elk River and the Finance Committee to check credit references and verify financial and other information. I /We agree to provide any additional information as may be requested by the City and the Finance Committee. DATE APPLICANT NAME BY BY S • Elk River Economic Development Authority Micro Loan Fund Application Page 7 of 7 Revised June 2004