The Appalachian Development Corporation
The following highlights financing programs are available through the Appalachian Development Corporation (ADC). The ADC is certified by the Small Business Administration to act as a Certified Development Corporation covering six upstate counties in South Carolina. Their office is located at 30 Century Circle in Greenville, SC and the phone number is (864) 242-9733.
Small Business Administration (SBA) 504 Loan Program
Eligible Businesses: Virtually all types of for-profit firms.
Eligible Uses: Acquisition of capital assets that includes land, buildings and equipment. All project costs can be financed including acquisition costs and soft costs such as life insurance, legal, appraisal, environmental and bridge loan costs.
Dollar Amounts: The financing structure consists of 50% first mortgage by the financial institution, the next 40% is done through the SBA 504 program as a second lien position, the applicant has to put up 10%. The SBA 40% can be up to $2,000,000 or 40% of the total project whichever is less. In addition, manufacturing firms can now fund up to $4,000,000 or 40% of the total eligible project, whichever is less.
Terms & Conditions:
1. Rate: Fixed rate for the duration of the loan and is normally at or below market.
2. Fees: SBA portion between 2% and 3 ½% that can be financed in the transaction.
3. Collateral: Typically the assets being financed leaving other company assets available as collateral for other borrowings.
4. Term: 10 years or 20 years with monthly payments.
Special: Financial institutions set their own interest rate, terms and fees on its portion of the project. Financial institutions can earn Community Reinvestment Credit.
Revolving Loan Fund (RLF) Including the USDA Intermediary Relending Program
Eligible Businesses: For-profit firms involved in manufacturing, industrial, service, and most retail firms. Restaurants and similar retail food-related firms are not eligible.
Eligible Uses: Funds can be used to finance fixed assets such as land, building, machinery, equipment, real property improvements, etc. Working capital loans are also available. Refinancing of old debt is not eligible.
Dollar Amounts: Maximum amount is $200,000. Minimum amount $20,000.
Terms & Conditions:
1. Rate: Normally fixed rates but can be variable if both borrower and lender agree. Rates will normally be less than market or prime.
2. Fees: Loan origination fee payable at closing, and borrower pays all closing costs.
3. Collateral: Sufficient collateral to support credit risk.
4. Term: Maximum
- fixed assets = 15 years
- working capital = 5 years
Special: The RLF loan must leverage private sector investment, either loans or equity. The business/borrower must contribute at least 10 percent of the project costs in equity. The borrower must show that their business will generate sufficient cash flow to repay the debt requested. Personal guaranties will be required of all principals owning 20% or more of the business. RLF loans may not be used for the relocation of a business from one state to another. Compliance with Federal Non-Relocation, Civil Rights and other Federal regulations is required.
Business Carolina Inc. (BCI)
This information highlights financing programs available through Business Carolina, Inc., a statewide business lending company that specializes in providing solutions to new and existing small and mid-sized businesses. Since 1992, they have represented the U.S. Department of Agriculture (USDA) and the Small Business Administration in administering loan programs. Their main office is located in Columbia, South Carolina (803) 461-3801, and their field office is in Greenville, South Carolina. For more information contact Logan Bagley at (864) 232-3674.
SBA 7(a) Loan Guarantee Program
Eligible Businesses: Existing or new for-profit, retail manufacturing, wholesale and service firms
Eligible Uses: Land, building, renovation or expansion, equipment, leasehold improvements, debt refinancing and working capital
Dollar Amounts: Loan amounts from $150,000 to $2,000,000
Terms & Conditions:
1. Rate: Prime + 2% to 2.75% variable
2. Collateral: Must pledge sufficient assets to secure loan.
3. Term: Up to 25 years, fully amortized
Other: Any owner with 20 percent or more of interest in the business must be a personal guarantor.
SBA Lowdoc Loan Program
Eligible Businesses: New or existing for-profit that need to quickly secure financing
Eligible Uses: May be used for expansion or renovation; real estate acquisition, leasehold improvements, working capital; refinance debt.
Dollar Amounts: Maximum amount is $150,000.
Terms & Conditions:
1. Rate: Prime + 2% to 2.75% variable
2. Collateral: Sufficient collateral to support credit risk
3. Term: Up to 25 years
SBA Micro-Loan Program for Entrepreneurs
Eligible Businesses: New and existing for-profit firms
Eligible Uses: Working capital, inventory, supplies, furniture, machinery and equipment. Funds may not be used to purchase real estate, provide a down payment on a project, or refinance existing debt.
Dollar Amounts: Maximum amount is $20,000.
Terms & Conditions:
1. Rate: Set by BCI
2. Fees: Borrower pays legal fees of lender.
3. Collateral: Must be sufficient to support credit risk.
4. Term: Maximum of 6 years
Other: Personal guarantees are required.
USDA Business & Industry Loan Program (B&I)
Eligible Businesses: New and existing for-profit and non-profit firms. Program is available to businesses located in census tracts with a population of 50,000 or less.
Eligible Uses: Purchase existing businesses, buildings or land, machinery, equipment, working capital, refinance construction loans or other indebtedness.
Dollar Amounts: Loans range from $1,000,000 to $5,000,000.
Terms & Conditions:
1. Rate: Variable at Prime + 1.50% to Prime + 2.50%
2. Collateral: Must be secured with fixed and/or non-fixed assets sufficient to support credit risk.
3. Term: Up to 25 years
Other: Personal guarantees of the principals are required with a 20% or more ownership of the company. Existing businesses must meet minimum tangible equity requirement.
USDA Intermediary Relending Program (IRP)
Eligible Businesses: For-profit manufacturing, industrial, and service firms. Limited to projects in rural areas and cities with a population of 25,000 or less.
Eligible Uses: Land, building, machinery, equipment, and working capital.
Dollar Amounts: Up to 75% of total project costs with a loan not to exceed $250,000.
Terms & Conditions:
1. Rate: Variable tied to NY Prime.
2. Collateral: Must be secured with first lien position on assets.
3. Term: Maximum - land & building = 15 years.
- machinery & equipment = 10 years.
- working capital = 5 years.
Other: Personal guarantees of the principals are required.
SC Jobs Economic Development Authority (JEDA)
The following information highlights financing programs available thru the South Carolina Jobs Economic Development Authority (JEDA). JEDA is a statewide not-for-profit agency that seeks to develop the business and economic welfare of SC through loans, investments and the financial promotion of export of goods and services produced within the state. Their office is located in Columbia, SC (803) 737-0268.
Tax-exempt Industrial Revenue Bond Program (IRB)
Eligible Businesses: Manufacturing and 501(c) (3) non-profit firms.
Eligible Uses: Land, building, machinery, and equipment.
Dollar Amounts: Maximum amount is $10,000,000.
Terms & Conditions:
1. Rate: Market rates either fixed or variable.
2. Fees: $500 nonrefundable application fee, issuance cost and annual fixed fees are paid by borrower and, where applicable, may be financed.
3. Collateral: Fixed assets sufficient to support project.
4. Term: Dependent upon assets being financed.
Other: Credit enhanced by financial institution or company with a rating of “BAA” or better.
Taxable Industrial Revenue Bond Program (TIRB)
Eligible Businesses: Manufacturing and 501(c) (3) non-profit firms.
Eligible Uses: Land, building, machinery, equipment and working capital.
Dollar Amounts: Minimum amount is $3,000,000.
Terms & Conditions:
1. Rate: Market rates either fixed or variable.
2. Fees: $500 nonrefundable application fee, issuance cost and annual fixed fees are paid by borrower and, where applicable, may be financed.
3. Collateral: Fixed assets sufficient to support project.
4. Term: Dependent upon assets being financed.
Other: Credit enhanced by financial institution or company with a rating of “BAA” or better
