1 / 13

Version 2 -- 6/13/13

Version 2 -- 6/13/13. 2008 Video Lottery Terminal legislation included a 1.5 percent set aside of revenue to benefit small, minority- and women-owned business account The Maryland Department of Business and Economic Development manages revolving loan fund

kaloni
Télécharger la présentation

Version 2 -- 6/13/13

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Version 2 -- 6/13/13

  2. 2008 Video Lottery Terminal legislation included a 1.5 percent set aside of revenue to benefit small, minority- and women-owned business account • The Maryland Department of Business and Economic Development manages revolving loan fund • AAEDC approved in April 2013 to be a fund manager • The VOLT Fund = AAEDC’s program • AAEDC planned allocation: • 70% conventional small business • 30% early-stage technology companies HISTORY

  3. REQUIREMENTS • TARGETED AREAS: 50% of the fund to small businesses located within a 10-mile radius of Maryland’s three casinos: • Maryland Live! (Anne Arundel) • Hollywood Casino Perryville (Cecil County) • Casino at Ocean Downs outside of Ocean City (Worcester County) • NON-TARGETED AREAS: Remaining funds for loans to small, minority- and women-owned businesses located in other areas of the state

  4. Loans amounts from $25,000 - $500,000 • Priced at below current market interest rates • Eligible purposes: • business or commercial real estate acquisition • building improvements • equipment/vehicle purchase • leasehold improvements • business start-up costs • working capital • Start ups and existing businesses eligible LOANS TO SMALL BUSINESS

  5. Use of standard underwriting practices • repayment capacity • financial strength of the company/guarantors • industry and management experience • collateral protection • Total processing time is 45-90 days • We ask for 3 years of financial statements, tax returns on the company and guarantors, and a personal financial statement • Post-closing servicing administered by AAEDC staff: • loan monitoring • billing • collections APPLICATION PROCESS

  6. Personal credit (640 or above) • Historical/projected Debt Service Coverage Ratio (DSCR) of 1.00x • Collateral required when available • All owners over 20% must personally guaranty the loan • Life insurance on owner/guarantor where no valid succession plan is in place • In addition, for start-up businesses: • minimum equity injection of 10% • business plan required • management and industry experience LOAN REQUIREMENTS

  7. LOANS TO TECHNOLOGY COMPANIES • Promising early stage companies • Loans to help attract follow-on funding from venture capital firms, angel investors and other sources • Loan amounts range from $100,000 to $250,000 (long term debt with payment deferred to future liquidity event) • Applications considered on a real-time basis as they are identified • Typical investor due diligence and evaluation process

  8. ELIGIBILITY CRITERIA FORTECHNOLOGY COMPANIES • High potential early stage small, minority- and women-owned technology company with clear path to follow-on funding, particularly engaged in cyber security, energy, life sciences or Health IT • Prefer company be affiliated with a member of the Maryland Business Incubation Association (MBIA)

  9. ELIGIBILITY CRITERIA FORTECHNOLOGY COMPANIES • Defendable intellectual property with clear ownership or licensing arrangement • Cash flow break-even reached within 18 months • Leader who is an experienced entrepreneur/demonstrates willingness to acquire needed management talent • Recognizable $20 million addressable market

  10. EXCLUDED TRANSACTIONS & INDUSTRIES • Financing existing debt where the fund is in position to take a loss • Loans to effect ownership change that will not benefit the business • Loans for the reimbursement of funds owed to an owner or reimbursement of equity injection • Loans for repayment of delinquent state or federal taxes

  11. EXCLUDED TRANSACTIONS & INDUSTRIES • Non-owner occupied real estate • Firms involved in speculative activities that develop profits from fluctuations rather than the normal course of trade • Firms involved in lending activities • Pyramid sales plans • Firms involved in gambling activities

  12. EXCLUDED TRANSACTIONS & INDUSTRIES • Adult bookstores/entertainment facilities • Gun shops • Liquor stores • Pawn shops • Tanning salons • Tattoo parlors • Check-cashing services

More Related