TRI-COUNTY COMMUNITY DEVELOPMENT
CORPORATION

Presentation
Any project requiring gap financing or seed capital loans for which no other conventional private or government resource exists can be presented to TCCDC for credit consideration. Said project and loan request should be presented by a representative of the lead bank. Projects for which no TCCDC member is acting as lead bank may still be presented by the appropriate advocate for the borrower.

The written presentation of the request should ideally include the following:
      1. Business plan including company history and structure.
      2. Three years historical financial information (Statements and tax returns).
      3. Two years sales and cash flow projections.
      4. Schedule of collateral.
      5. Explanation of need for TCCDC financing.
      6. Terms and conditions of conventional bank loan and any other
          financing arrangements.
      7. Any other pertinent information.

Approval
Approved of requests will be based on two broad criteria that being the external need for the project in question including such things as the potential market for the product or service, the job growth potential and the general economic impact on the area; and the risk associated with the project including the current financial position, the available collateral and the soundness of the projections.

Limitations
Loan requests are to be categorized as seed capital loans or gap financing. In the case of seed capital loans, a maximum of $10,000 will be advanced and in no case should this amount, together with any other subordinated loans, be more than 50% of all amounts to be borrowed. A minimum of one job should be created.

Gap financing requests will be limited on a graduated basis as follows:
      Project Cost                  Maximum Loan
      $30-100,000                  30% of Project Cost
      $100-500,000                Greater of 20% of Project Cost or $30,000
      $500-1,000,000             Greater of 15% of Project Cost or $100,000
      $1,000,000 and up        Greater 10% of Project Cost or $150,000

Terms
Loan terms, interest rate, amortization schedule, balloon payment, etc... will normally be the same as that established by the conventional lender.

Goal
Retain and create employment in Morgan, Cass, and Scott counties. Growth in the tri-county wage pool will have a multiplier effect for total demand of goods and services, which will benefit the entire area

Methods
      1. Provide gap financing with subordinated debt.
      2. Invest in projects that need greater owner equity in order to meet loan
          standards established by banks and various government assistance
          programs.
      3. Use small seed capital loans (probably not over $10,000) to assist
          businesses that lack adequate equity or operating history to qualify for a
          conventional bank loan.
      4. Draw on the expertise of our board members and investors to assist new
          and expanding businesses. Our combined resources and contacts are a
          valuable resource to assist local economic development.
      5. Invest or participate with other public and/or private entities to provide
          industrial sites or buildings to retain or attract employers.
      6. Encourage local municipal units to take a proactive position in economic
          development. Explore methods to allow local units to create revolving loan
          funds to leverage with CDC funds.

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