USDA IRP LOAN FUND PROSPERA BUSINESS NETWORK 2015 CHARLOTTE STREET, SUITE 1 BOZEMAN, MT

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1 USDA IRP LOAN FUND Prospera s Intermediary Relending Program Revolving Loan Fund ( IRP Loan Fund ) provides financing to businesses located in Gallatin County and Park County. Prospera s IRP Loan Fund was established with funding from the U.S. Department of Agriculture Rural Development s Intermediary Relending Program (IRP) and the Montana Board of Investments. The goal of the Fund is to support economic growth and the creation of higher paying jobs in Gallatin County and Park County. These loans are made to local businesses that cannot attract sufficient private financing or are unable to secure all of their financing needs through a commercial lender. The IRP Loan Fund is another option for businesses that may not fully satisfy the requirements of a commercial lender. As such, the Fund is a source for gap financing to participate in a project with another lender (the Fund may take a secondary position on collateral). All lending decisions are made by Prospera s Loan Review Committee. ELIGIBLE BUSINESSES Eligible businesses must be located in Gallatin County or in Park County. Preference is given to those businesses engaged in basic economic activities providing quality jobs, with 50% or more of their gross annual revenues derived from outside the county. Quality jobs are defined as those where the combination of wages, benefits and workplace environment contribute to a productive and satisfying work experience for employees. In addition, priority consideration is given to projects that: Propose to create jobs for low to moderate income individuals. Propose to create or expand existing manufacturing and technology-based employment opportunities. Demonstrate a job creation/retention ratio of no less than one job per $20,000 in IRP loan funds. Demonstrate a private investment leverage ratio of at least one dollar of new private investment for every one dollar of IRP loan funds. Interested businesses should discuss their project with Prospera Business Network staff to determine eligibility prior to submitting an application. ELIGIBLE USES OF FUNDS IRP Fund loan funds can be used for most typical business start-up and expansion activities including: land purchase; construction, rehabilitation, expansion or installation of commercial and industrial buildings or facilities; purchase of machinery or equipment; working capital and employee training. The funds may also be used as a match to other funding sources, as long as they are contingent upon approval of the other funding source. GENERAL LOAN TERMS The maximum IRP loan amount shall not exceed $250,000. The cost per job to be created or retained must not exceed $20,000 per job (for example, a $100,000 loan should create or retain 5 jobs). The revolving loan fund amount must be matched on a one-to-one basis from another source, i.e. bank loan, owner investment equity, private funds, SBA, grants, or a combination of sources. Specific loan terms (including the interest rate) will be determined by the Loan Review Committee after review of the application and will be based on the specific project needs. In no case will the minimum allowable interest rate be less than 5%. All loans must be secured with a personal guarantee and other reasonable sources of available collateral. The IRP Fund may take a secondary position on collateral behind a commercial lender. PROSPERA BUSINESS NETWORK 2015 CHARLOTTE STREET, SUITE 1 BOZEMAN, MT

2 APPLICATION REVIEW Completed loan applications will be reviewed by the Loan Review Committee within 21 days of submission to Prospera Business Network. The applicant will receive written notification of the Committee s decision within 7 days of completion of the application review. Loan applications are evaluated on the following criteria: Project feasibility, potential for business success, growth and expansion; ability to repay loan Experience, credibility and qualifications of applicant business ownership and management team Economic impact of project (increased revenues from outside the area, job creation, etc.) Demonstration of need for a loan from the IRP Fund (not able to secure necessary financing from a commercial lender) Degree of leverage with other investment, including public and private sources (at least a 1:1 match) Creation and retention of quality jobs in the region (quality jobs are defined as those where the combination of wages, benefits and workplace environment contribute to a productive and satisfying work experience for employees) Cost per job created or retained must not exceed $20,000 per job (for example, a $100,000 loan should create and retain at least 5 jobs) A completed loan application will include a signed and dated application form (applicant and business information, employment projections, source and use of funds, other sources of financing, references, explanation of need for loan); a written business plan; and required supporting documentation. Required supporting documentation includes: personal financial statement (signed and dated within 3 months); personal and business federal income tax returns (last 3 years); business income statement and balance sheet for 3 most recent years; current year income statement and balance sheet (current year to date within 30 days); monthly cash flow projection with explanation of assumptions (for first year); annual cash flow projections (for 2nd and 3rd year); corporate documents; and resumes of owners/managers and key personnel. Additional documents may be requested by Prospera staff and the Loan Review Committee. There is no loan application fee. However, a 2% loan or $500 loan origination fee (whichever is greater) is payable to Prospera Business Network at the time of loan closing along with the cost of title insurance, recording costs, loan closing fees, appraisals or any other necessary fees. Interested businesses should discuss the details of their project with Prospera Business Network staff to determine eligibility prior to submitting any application materials. CONTACT PAUL REICHERT EXECUTIVE DIRECTOR PREICHERT@PROSPERABUSINESSNETWORK.ORG PROSPERA BUSINESS NETWORK 2015 CHARLOTTE STREET, SUITE 1, BOZEMAN, MT EQUAL OPPORTUNITY STATEMENT: The IRP Loan Fund is an Equal Opportunity Program. Discrimination is prohibited by Federal Law. Complaints of discrimination may be filed with USDA, Director, Office of Civil Rights, Room 326-W, Whitten Bldg., 1400 Independence Ave., SW, Washington, DC PROSPERA BUSINESS NETWORK 2015 CHARLOTTE STREET, SUITE 1 BOZEMAN, MT

3 USDA IRP REVOLVING LOAN FUND APPLICATION Thank you for your interest in business financing from Prospera Business Network. If you are considering applying for a business loan from Prospera Business Network, please speak with a member of our lending team before completing this form to learn about the application process and to determine if your business is eligible. CONTACT: PAUL REICHERT EXECUTIVE DIRECTOR PREICHERT@PROSPERABUSINESSNETWORK.ORG PROSPERA BUSINESS NETWORK 2015 CHARLOTTE STREET, SUITE 1, BOZEMAN, MONTANA This loan application is intended to provide Prospera Business Network staff and the Prospera Business Network Loan Review Committee with the necessary information to evaluate the applicant business s eligibility and suitability for financing through Prospera Business Network. Additional information may be requested to complete the evaluation. PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 1/8

4 BUSINESS INFORMATION BUSINESS NAME: PRIMARY CONTACT: BUSINESS ADDRESS: CITY, STATE, ZIP: TELEPHONE: FAX: MOBILE: BUSINESS WEBSITE: FEDERAL TAX ID: * D&B DUNS #: DATE BUSINESS ESTABLISHED: FORM OF BUSINESS ORGANIZATION: CURRENT NUMBER OF EMPLOYEES: AVERAGE GROSS ANNUAL REVENUES (LAST 3 YEARS): PRIMARY APPLICANT OR GUARANTOR: SOCIAL SECURITY NUMBER: CO-APPLICANT OR GUARANTOR: SOCIAL SECURITY NUMBER: CO-APPLICANT OR GUARANTOR: SOCIAL SECURITY NUMBER: DESCRIPTION OF BUSINESS: LIST ANY SUBSIDIARY AND/OR AFFILIATED BUSINESSES: LOAN REQUEST LOAN AMOUNT REQUESTED: $ PURPOSE OF LOAN: HAVE YOU APPLIED FOR OTHER FINANCING FOR THIS PROJECT? IF SO, WHERE? STATUS OF OTHER REQUESTS: * Dun & Bradstreet, or D&B, provides the DUNS Number. More information and free online request form at PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 2/8

5 BUSINESS OWNERSHIP Provide the following information for all principals of the business (individuals, corporations, partnerships, etc. owning 10% or more of the business). Attach an additional sheet if necessary. An individual Personal Financial Statement is required for each principal or partner owning 10% or more of the business. NAME, TITLE, HOME ADDRESS OWNERSHIP % OWNED SINCE (YEAR) TOTAL PROJECT FINANCING Provide the total current capital needs of the business and how the proposed new funding will be used (total use of funds). In addition, specify the amounts of other new sources of funding and how they will be used. Attach letters of commitment from all proposed sources of new funds. SOURCE OF FUNDS USE OF FUNDS PROSPERA BUSINESS NETWORK LOAN COMMERCIAL BANK LOAN OTHER OWNER CASH TOTAL USE OF FUNDS LAND PURCHASE LAND IMPROVEMENT BUILDING PURCHASE BUILDING IMPROVEMENT EQUIPMENT/ MACHINERY FURNITURE/ FIXTURES WORKING CAPITAL EMPLOYEE TRAINING OTHER: TOTAL SOURCE OF FUNDS PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 3/8

6 PARTICIPATING LENDERS AND OTHER SOURCES OF FINANCING LENDER: AMOUNT: CONTACT NAME: TELEPHONE: OTHER LENDER OR SOURCE OF FINANCING: AMOUNT: CONTACT NAME: TELEPHONE: FINANCIAL AND BUSINESS REFERENCES COMPANY: CONTACT: ADDRESS: TELEPHONE: BUSINESS RELATIONSHIP SINCE: COMPANY: CONTACT: ADDRESS: TELEPHONE: BUSINESS RELATIONSHIP SINCE: COMPANY: CONTACT: ADDRESS: TELEPHONE: BUSINESS RELATIONSHIP SINCE: PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 4/8

7 ADDITIONAL INFORMATION Provide narrative responses addressing each of the following items: 1. Explain how the applicant business satisfies the applicable eligibility requirements for financing from Prospera Business Network. 2. Describe the applicant business s need for a loan from Prospera Business Network. Explain why a commercial bank loan or other source of funding cannot satisfy the current capital needs of the business. 3. Describe how the loan funds will be used and their significance to the growth and expansion of the business (if not specifically addressed in the business plan). 4. Describe the projected economic impact of this loan. Include the projected job retention and job creation over the term of the loan. Include the percentage of revenues from outside the area and any projected increase in revenues from outside the area. Also describe the quality of jobs including salaries, wages, and types of employment benefits. 5. Describe the business and personal property proposed as collateral to secure this loan, include the value (and source of valuation) and any current liens on the property (if applicable). Provide a copy of the most recent real estate appraisal if real estate is proposed as collateral. 6. Describe any existing business debt as well as personal debt, including original amounts, current balances, monthly payments, etc. 7. Has the company or any of its principals ever filed for bankruptcy protection? If yes, please explain in detail. 8. Describe and explain any outstanding debts between the company and related parties such as the owners or relatives of the owners. Describe and explain any other sorts of related party transactions, if any. 9. Is the company or any of its principal officers or shareholders involved in any litigation, either as a plaintiff or defendant? If so, please explain in detail. 10. Has the company or any of its principals ever been under indictment, on parole, on probation, charged with or convicted of any criminal offense other than a minor vehicle violation? If yes, please explain in detail. PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 5/8

8 BUSINESS PLAN Provide a written business plan addressing the following areas: Organization and Operating Plan: describe the business and the products/services offered, the location, legal structure, the ownership and management team, personnel, accounting and recordkeeping Marketing Plan: describe the target market, customers, competitors, pricing strategy, distribution channels, promotional plan Growth Plan: describe the financial needs of the business, the proposed use of funds, and how this is significant to the future growth strategy of the business Financial Plan: based on the growth plan, formulate a revenue and expense projection (cash flow) for the next three years (monthly cash flow projection for 1 st and 2 nd years, annual cash flow for 3 rd year) REQUIRED SUPPORTING DOCUMENTATION The following supporting documentation is required: Personal federal income tax returns for last 3 years Personal financial statement (dated within last 3 months) Business federal income tax returns for last 3 years Business financial statements (balance sheet and income statements) for last 3 years plus current year to date (within 30 days) Accounts payable aging report Accounts receivable aging report Corporate documents Most recent real estate appraisal (if property is proposed as collateral) Copy of lease or rental agreement (if applicable) PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 6/8

9 APPLICATION TERMS AND CONDITIONS 1. Prospera Business Network shall maintain in confidence all personal, business, trade, commercial and financial information provided with this loan application (including all supporting documents and attachments). 2. Applications for funding will be approved or rejected at the sole discretion of the Loan Review Committee. Prospera Business Network staff does not make lending decisions. 3. The undersigned acknowledges and agrees that Prospera Business Network will investigate the creditworthiness of the applicant business and its owners, including review of credit histories and verification of tax information. 4. The undersigned acknowledges and agrees that Prospera Business Network will contact the business and trade references provided with this application. 5. The undersigned authorizes Prospera Business Network to contact the applicant s existing lender (or lenders) for loan payoff information and credit reference (if applicable). 6. The undersigned acknowledges that there is no fee associated with submitting this loan application and agrees to pay a 2% loan origination fee to Prospera Business Network (2% of loan amount) at the time of loan closing (if this application is approved). CERTIFICATION STATEMENT I hereby certify that the statements and information contained in this application, including all attachments, are warranted to be true, valid and correct. To the best of my knowledge, they present accurately the condition of the applicant business and the intended operations for the period set forth in this application. I have read, understand and agree to comply with all terms and conditions set forth in this application. I hereby authorize Prospera Business Network to make all inquiries it deems necessary to verify the accuracy of the information provided herein, to determine my credit-worthiness, and for any other purpose related to this loan application. APPLICANT SIGNATURE PRINT NAME AND TITLE DATE PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 7/8

10 EQUAL OPPORTUNITY STATEMENT This Program is an Equal Opportunity Program. Discrimination is prohibited by Federal Law. Complaints of discrimination may be filed with USDA, Director, Office of Civil Rights, Room 326-W, Whitten Bldg., 1400 Independence Ave., SW, Washington, DC COMPLIANCE WITH PROHIBITION OF DISCRIMINATION The following information is requested by the Federal Government in order to monitor compliance with Federal laws prohibiting discrimination against applicants seeking to participate in this program. You are not required to furnish this information, but are encouraged to do so. This information will not be used in evaluating your application or to discriminate against you in any way. However, if you choose not to furnish it, we are required to note the racial/national origin of the individual applicants on the basis of visual observation or surname. ETHNICITY Hispanic or Latino: Not Hispanic or Latino: RACE White: Black or African American: (MARK 1 OR MORE) American Indian/Alaska Native: Asian: Native Hawaiian or Other Pacific Islander: GENDER Male: Female: PROSPERA BUSINESS NETWORK LOAN APPLICATION FORM (EFFECTIVE: NOVEMBER 2009) 8/8

11 PERSONAL FINANCIAL STATEMENT As of, 2013 Complete this form for each principal, or each limited partner who owns 10% or more interest, and each general partner, or each stockholder owning 10% or more of voting stock, and any other person or entity providing a guaranty of the loan. Name Business Phone ( ) Residence Address Residence Phone ( ) Business Name of Applicant/Borrower Balance ASSETS (Omit Cents) LIABILITIES Business Phone ( ) Balance (Omit Cents) Cash on hand and in banks $ Accounts Payable $ Savings accounts and CDs $ Notes Payable (Section 2) $ IRA or other Retirement Accounts $ Auto Loans Monthly Payment $ $ Accounts & Notes Receivable $ Credit Cards Monthly Payment $ $ Life Insurance Cash Value only (Section 8) $ Other Installment Loans (Section 5) $ Stocks & Bonds (Section 3) $ Loan on Life Insurance $ Real Estate (Section 4) $ Mortgages on Real Estate (Section 4) $ Automobile Yr./Make $ Unpaid Taxes (Section 6) $ Automobile Yr./Make $ Other Liabilities (Section 7) $ Other Personal Property (Section 5) $ Total Liabilities $ Other Assets (Section 5) $ Net Worth $ Total Assets $ Total Liabilities & Net Worth $ Section 1 Source of Income Contingent Liabilities Salary $ As Endorser or Co-Maker $ Net Investment Income $ Legal Claims & Judgments $ Real Estate Income $ Provision for Federal Income Tax $ Other Income (Describe below) $ Other Special Debt $ Description of Other Income in Section 1 Note: Alimony or child support payments need not be disclosed in Other Income unless it is desired to have such payments counted in total income. Section 2 - Note Payable to Bank and Others (Use attachments as necessary. Each attachment must be identified as a part of the statement, signed & dated.) Name and Address of Noteholder(s) Original Balance Current Balance Payment Amount Payment Frequency How Secured or Endorsed & Type of Collateral PROSPERA BUSINESS NETWORK PERSONAL FINANCIAL STATEMENT (EFFECTIVE: APRIL 2009) PAGE 1/2

12 Section 3 Stocks & Bonds (Use attachments as necessary. Each attachment must be identified as a part of the statement, signed and dated.) Number of Shares Name of Securities Cost Market Value Quotation Or Exchange Date of Quotation Or Exchange Total Value Section 4 Real Estate Owned (List each parcel separately. Each attachment must be identified as a part of the statement, signed and dated.) Type of Property Address of Property Date Purchased Original Cost Present Market Value Mortgage Balance Monthly Payments Monthly Rental Income Name & Address of Mortgage Lender Section 5 Other Personal Property & Other Assets including business investments not described above (Describe, and if any is pledged as security, provide details of debt in Section 2 above. If assets are pledged for the debt of others, state name and address of lien holder, amount of lien, terms of payment, and if delinquent, describe delinquency.) Section 6 Unpaid Taxes (Describe in detail: type, to whom payable, when due, amount, and to what property, if any a tax lien attaches.) Section 7 Other Liabilities (Describe in detail.) Section 8 Life Insurance Held (Give face amount and cash surrender value of policies, name of insurance company and beneficiaries.) I authorize Prospera Business Network/Lender to make inquiries as necessary to verify the accuracy of the statements made and to determine my creditworthiness. I certify that the statements contained in the attachments and above are true and accurate as of the stated date(s). These statements are made for the purpose of either obtaining a loan or guaranteeing a loan. I understand false or misleading statements may result in rejection of the loan application and shall constitute a default of the loan agreement. Have you ever filed bankruptcy? Yes No Do you have a will? Yes No Do you have life insurance? Yes No Do you have disability insurance? Yes No Signature: Date: Social Security #: Signature: Date: Social Security #: PROSPERA BUSINESS NETWORK PERSONAL FINANCIAL STATEMENT (EFFECTIVE: APRIL 2009) PAGE 2/2