Financing your ideas and innovations
Presented by
Bob Humann, Senior Vice President Lending Services
Bank of North Dakota
December 2013
Financing a value-added processing business
Business
Debt financing 60%
Equity 40%
Member investment
Bank debt
•
•
Lead Bank and BND partner
Cash
BND Programs
• Ag PACE Loan
• Envest Loan
NDDF and/or
Regional Councils
Ag PACE: $20K/borrower, 4% interest buydown
Envest: 1% below BND’s Base Rate (3.25-1.00=2.25%)
Biofuels PACE: $250K/project; 5% interest buydown
PACE: $300K/project; 5% interest buydown
•
BND Programs
• Ag PACE Loan
• BioFuels PACE Loan
• USDA Loan Guarantee
Subordinated debt
•
•
SBA 504 Program
NDDF and/or Regional
Councils
Ag PACE
North Dakota farmer can use for
• Sideline business other than
traditional
agriculture
• Develop new irrigated acreage
• Purchase equity shares in a value-added processing
business
• Purchase capital improvements for retention of livestock or
dairy operations
• Purchase equity shares in a condominium grain storage
entity
• Develop subsurface field tiling projects
Ag PACE
• $2 million fund
• BND 50% - 80% of total loan
• Interest buydown 4% below yield rate
• Maximum per borrower of $20K per biennium; $60K lifetime cap
Note: Interest buydown dollars exceeding $20K
must have a net worth of less than $1M
• Loan terms: 5-15 years
• Collateral: Other than equity shares
Envest
• North Dakota resident can use to
• Purchase shares in a start-up or expansion of
ag-processing plant that processes ND-grown products
• Purchase shares in a ND feedlot or dairy operation that
feeds byproducts of an ethanol or biodiesel facility
Envest
• Borrower may not own more than 25% of project
• BND participates up to 70% of total loan
• Interest rate: BND share is BND base less 1%, variable
• Shares in ND feedlot or dairy operation that feeds byproducts of
an ethanol or biodiesel facility: Interest buydown of 4%
• Total buydown amount per borrower may not exceed a lifetime
cap of $20K
• A farmer that receives interest buydown from Ag PACE Fund is
not eligible to receive interest buydown under Envest for funds to
be invested in the same project
• $1 million in buydown funds available from the Beginning Farmer
Revolving Fund
• Loan term: 5-7 years
• Collateral: Other than equity shares
For more information
Bob Humann, Senior Vice President
Lending Services, Bank of North Dakota
701.328.5703
[email protected]
BND Ag Lending Staff Members
Mark Weide, Manager [email protected] 701.328.5790
Loan Officers
Annette Curl, northeast ND [email protected] 701.328.5786
Jim Leier, southwest ND [email protected] 701.328.5802
Bruce Schumacher, southeast ND [email protected] 701.328.5668
Rod Thorson, northwest ND [email protected] 701.328.5635
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Financing Your Ideas and Innovations