Direct 166 Loan Program
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Direct 166 Loan Program

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  • The program requires the creation or retention of one job for each $15,000 of loan proceeds within a 3 year period. There is a Priority Investment Area map for eligible areas. The office of Strategic Research updates the map on January 1 st and July 1 st of each year.e
  • When are personal guarantees required? For privately held companies, occasionally we will consider a Letter of credit in lieu of a personal guarantee. If the company has sales greater than $150 million and impressive financial performance.

Direct 166 Loan Program Direct 166 Loan Program Presentation Transcript

  • 166 Direct Loan
    • 166 Direct Loan Program
      • The 166 Loan Program was created in 1982 to promote economic development in the State of Ohio.
      • Created a large revolving loan fund out of which loans are made. As repayments are collected, new loans are made.
      • The 166 Loan Program provides low-interest loans to businesses willing to commit to create new jobs or preserve existing employment opportunities in the State of Ohio.
  • 166 Direct Loan
    • Available Funding
      • Loan amounts of $500,000 to $1 million
      • Typically between 30-50% of the projects allowable costs
      • Up to $15,000 per job ($35,000 in priority investment areas)
      • Partner with bank and equity
    • Rate and Term
      • Interest rates are fixed
      • Term conditions upon the useful life of the assets
        • Maximum of up to 15 years for real estate
        • Maximum of up to 10 years for machinery and equipment
  • 166 Direct Loan
    • Collateral /Security Requirements
      • Shared first priority mortgage and/or lien position on assets financed loan proceeds
      • Personal guarantees from owners with 20% ownership in company
        • May be required:
          • Corporate guarantees from related companies
          • Full or partial letter of credit
          • Life insurance on key business owners
      • Equity Requirement - 10% of the loan amount
      • No pre-payment penalty
      • Take-out financing
        • Funds will only be disbursed once the project has been completed. The borrower will be responsible for securing financing for project related cost through loan closing and project completion.
  • 166 Direct Loan
    • Eligible Businesses and Costs include:
      • Manufacturing, Research and Development, Distribution
      • Retail projects are ineligible
      • Fixed asset investments
        • Land and building acquisition
        • Building expansion, renovation and construction
        • Equipment purchases
        • Acquisition of ongoing business fixed assets
        • Limited soft costs
  • For More Information:
    • Web Site:
      • For all ODOD debt financing information discussed today or more detailed information
      • http://development.ohio.gov/EDD/Loans_Grants.htm
    • Questions? Contact:
    • Office of Financial Incentives
    • State of Ohio, Department of Development
    • (614) 466-5420
  • Ohio Department of Development Financing Programs Ohio Economic Development Association Office of Financial Incentives October 14, 2009