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Advantage IllinoisLoan Participation Program1
Advantage Illinois (“AI”) Origin of Funding Small Business Jobs Act of 2010 Title III – “State Small Business Credit Initiative” 1.5 BN Divided according to state/territorypopulation and unemployment experience during2008 & 2009 Illinois’ Allocation: 78,365,264 Small Business Definitions Maximum Borrower/Recipient Size: 750Employees Maximum Loan/Investment Size: 20MM or Less2
Advantage Illinois (“AI”)AI Performance - December 2017 AI Funds Obligated/Expended: 92 Million Loans/Investments (including “Follow-On Financing”) 818 Million Private Sector Loans/Investments Catalyzed(including “Follow-On Financing”) 726 Million Total Created/Retained Jobs Committed:5,212 (3,706 / 1,506)3
Advantage Illinois (“AI”)Prohibited Uses Passive Real Estate “Ownership Interests” Purchases of Shares/Stock “Goodwill”, (though almost all other Tangible/Intangible assets may be financed) Support of “Companion Loans” permitted Certain Industries/Purposes4
Advantage Illinois (“AI”)Loan Programs Participation Loan Program (“PLP”)o Equipment Term Loanso Real Estate Term Loanso Revolving Lines of Credit FAMEMinority/Women/Disabled/Veteran-Owned Businesses SBA Supported Projects5
Advantage Illinois (“AI”)Standard Participation Loan Program DCEO’s Participation is subordinated to Lender Documentation and loan servicing is “short and simple”. Maximum Participation - lesser of: a) 25% of the Project, b) 50% ofthe Loan, or c) up to 1.5MM, depending on job creation/retention. Maximum term 10 years. Interest Rate – 2.0% below Bank rate. Refinancing of one Lender’s loans by an unrelated Lender nowpermitted. (Refinancing of a Lender’s existing exposure ispossible under substantially limited terms/conditions.)6
Advantage Illinois (“AI”)Fund for the Advancement of MinorityEnterprises (“FAME”)PLP Targeted toward Minority/Women/Disabled/VeteranOwned Businesses Structure similar to PLP, maximum participation - lesser ofa) 50% of the “Project”, b) 50% of the Loan, or c) up to 400K, depending on job creation/retention. Interest Rate - currently 2.0% Maximum amortization - 7 years. Majority ownership, (51% or more), and “control”.7
Advantage Illinois (“AI”)Revolving Line of Credit PLP Program Basic structure is similar to the Standard PLP. Maximum participation - lesser of a) 25% of the “Project”, b) 50%of the RLOC Facility, or c) up to 1.5MM, depending on jobcreation/retention. Maximum term - 2 years. (Refinancing of PLP-supported Facilitypossible but requires reapplication and probably facility increase.) Refinancing of one Lender’s RLOC facility by an unrelated Lenderis permitted. DCEO Participation deposited with Lender at closing; Lender pays¼% p.a. interest on the entire DCEO’s Participation.8
Advantage Illinois (“AI”)PLP Assistance in Conjunction with Small BusinessAdministration (“SBA”) Supported Activity DCEO participation limited to “purposes other than thosefinanced with SBA assistance”. Thus DCEO may participatein up to 50% of “Companion Loans” provided by the Lender tothe same Borrower, when documented with separate,unguaranteed Notes. DCEO’s credit exposure subordinated to the Lender’s, andwhen required, to the SBA’s interests as well. DCEO may not support Lender’s unguaranteed portion underthe SBA-7A Guarantee. Same restrictions apply in relation to other Federal Programs9
Search: DCEO Advantage Illinois10
Advantage IllinoisVictor Narusis, Acting Advantage Illinois ManagerIL Department of Commerce & Economic Opportunity100 West Randolph Street (Suite 3-400)Chicago Illinois, 60601Direct Phone: (312) 497-3160E-Mail: victor.narusis@illinois.gov11
THANK YOU12
Standard Participation Loan Program DCEO's Participation is subordinated to Lender Documentation and loan servicing is "short and simple". Maximum Participation - lesser of: a) 25% of the Project, b) 50% of the Loan, or c) up to 1.5MM, depending on job creation/retention. Maximum term 10 years. Interest Rate - 2.0% .
