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
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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
