STREDC Loan Eligibility

Eligible Applicants:

For-profit businesses located within the service area and which employ fewer than 100 employees are eligible. Priority will be given to projects that will provide increases in net new permanent jobs, are located in distressed areas or employing persons living in such areas, and are initiated by minorities and/or women.

Ineligible Applicants:

Projects that involve relocation from one municipality to another unless approved by both municipalities are not eligible. Projects involving newspapers, broadcasting or other news media, medical facilities, libraries, community or civic centers and public infrastructure improvements are ineligible. Retail projects are ineligible unless the Corporation deems the increase in net new permanent jobs significant.

Eligible Activities:*

Loan proceeds are to be used for working capital..

Ineligible Activities:

Loan proceeds may not be used for refinancing except for the purpose of transferring ownership to the employees or other interested party, and thus prevent a business from departing, ceasing or substantially reducing operations within New York State.

Maximum Loan Size:

Loans can be made for up to fifty percent (50%) of the total project cost, or $75,000, whichever is less.

Equity Requirement

Minimum of 10% cash equity injection required.

Interest Rate:**

Interest rate shall be based at determined at time of loan approval. The interest rate, will in no event, go below six percent (6%).

Terms:***

Terms shall be between three and five years, with a maximum loan term of five years.

Participation:

Applicants must have a minimum equity interest of 10% in the business or project and must demonstrate that there is little prospect of obtaining the requested financial assistance from other public and private sources of funding.

Fees:

$250 non-refundable loan application fee. 1% loan service fee. Borrowers shall also be responsible for all closing costs incurred as a result of their loan, including, but not limited to, attorney fees and recording costs.

Payment Schedule:

Payments are due on the first day of each month. Any payment not received on or before the 10th of the month will be assessed a late fee.

Collateral

All loans will be secured by a lien on assets. Personal guarantees of any principal with 20% or more ownership is required.

Code Compliance:

Required.

"REDEC ensures confidentiality of all applicants and does not discriminate against any applicant because of race, color, religion, sex, or national origin."