1. A. An application fee of $500 shall be submitted at the time of application.

2. B. Applications will be processed for a matching equity capital investment or for a co-investment as follows.

   1. 1. Applications will be processed in the order in which they are received.
   2. 2. LEDC staff will conduct an initial screening of the application for completeness.
   3. 3. An incomplete application will be returned to the submitter. A previously incomplete application may be resubmitted, which will establish a new time and date received for that application.
   4. 4. An incomplete application not resubmitted within 30 days will forfeit the application fee.
   5. 5. LEDC staff will begin the evaluation process within 30 days of receipt.
3. C. Information submitted with the application either for a match investment or co-investment representing the applicant's business plan, financial position, financial projections, personal financial statements and background checks will be kept confidential to the extent allowed under the Public Records Law, R.S. 44:1 et seq. Confidential information in the files of LEDC and its accounts acquired in the course of duty will be used solely by and for LEDC. However, in the event of a BIDCO's licensure surrender, dissolution, bankruptcy, or other indication of insolvency previously confidential information shall be disclosable under the Public Records Law.
4. D. A BIDCO shall submit to LEDC evidence of its OFI approval with the application.

5. E. Application for a matching investment will contain the following information. The applicant may provide other information which it believes relevant. LEDC may request further information beyond what is specified below:

   1. 1. name of BIDCO, address (mailing and physical);
   2. 2. specify the amount of LEDC investment/ commitment requested;
   3. 3. specify the minimum and maximum amounts of non-LEDC capital to be raised if the LEDC makes the requested investment/commitment;
   4. 4. specify applicant's projected timetable, with milestones for completion of the fund raising;
   5. 5. specify whether applicant anticipates taking in all of the committed capital investment at closing, or whether applicant plans a phase in. If a phase-in is planned, specify the proposed schedule. It is permissible to have different scenarios based on the actual amount of capital raised;

   6. 6. market―identify the proposed market of the applicant:

      1. a. describe and discuss the types of businesses that the BIDCO will finance. Discuss the extent to which the BIDCO intends to specialize in certain industries, or if special circumstances will be addressed;
      2. b. describe the size range of businesses that it is contemplated the BIDCO will finance, with a general indication of where most of the focus is expected;
      3. c. discuss the life cycle stage or stages of the companies which the BIDCO will likely finance, with an indication of where most of the focus is contemplated, i.e., start-up, expansion;
      4. d. discuss the geographic area in which the BIDCO plans to focus. Specify the city or parish in which the BIDCO's principal office will be located, and discuss intentions, if any, to establish any additional offices;
   7. 7. Management Assistance. Discuss the plans of the BIDCO to provide management and/or technical assistance to companies for which the BIDCO provides financing. Discuss the BIDCO's plans for monitoring its financing, and enforcing provisions of loan or investment agreements. Discuss how the BIDCO plans to handle problem loans and investments;
   8. 8. Idle Funds. Describe plans for the management of the idle funds of the BIDCO;
   9. 9. Realization of Returns by Investors. Discuss long term plans and strategies for providing a tangible return to the investors in the BIDCO including dividend policy, public markets, future mergers and acquisitions, sinking funds, etc.;
   10. 10. Tax and Accounting Issues. Discuss relevant tax and accounting issues for the BIDCO;
   11. 11. submit business and professional references for all stockholders, members of the board and corporate officers;
   12. 12. Management Structure. Describe the proposed management structure for the BIDCO;
   13. 13. describe the proposed responsibilities of each of the members of the management team. If any of these people will not be full time, describe their other activities;
   14. 14. describe the responsibilities of any management position for which a person has not been identified;
   15. 15. specify any other key people including any advisors, consultants, attorneys and accountants, and submit resumes and/or descriptions of firms. LEDC reserves the right to perform general and criminal background checks on these key people;
   16. 16. identify all principal shareholders (i.e., owning directly or indirectly, or controlling directly or indirectly,
       10 percent or more of the voting stock of the BIDCO), by name with specific ownership identified;

   17. 17. Financial Projections. Provide the following financial projections:

       1. a. returns-on-average assets and returns-on-capital performance projections, year by year, for a 10 year period. These projections should show summary cash flow, summary income and expense (including taxes), and summary balance sheet data. For these performance projections, operating income and expenses can be grouped by category. Emphasis must be placed on a specific exit strategies including provisions for a sinking fund to buy out LEDC's position. Specify the assumptions used for the performance projections;
       2. b. specify computer programs used for projections, if any, and specify formulas used.

6. F. A business plan which contains the following information shall be submitted for either a match investment or a co-investment request.

   1. 1. Provide a market analysis that the applicant deems relevant.
   2. 2. Marketing Strategy. Describe the BIDCO's plans and approach to marketing its services, including methods of identifying potential applicants for financing assistance.
   3. 3. Screening Process and Evaluation Criteria. Discuss the anticipated number of business firms that will be reviewed for possible financing assistance, in comparison with the number that will actually be financed. Discuss the approach to screening business firms, and the evaluation criteria for deciding whether, and under what terms and conditions, to provide financing assistance.
   4. 4. Financing. Describe and discuss the financing instruments that are intended to be used by the BIDCO (e.g., debt with capital features, royalty, capital, pure debt (with SBA or not), etc.). Discuss the anticipated mix of the various types of financing instruments. Discuss the anticipated size range of loans/investments to be made, and information regarding pricing, term, and other conditions. Discuss risk/return expectations on projects. Discuss methods of exit from investments.
   5. 5. Specify applicant's start-up budget, including funds already expended and a detailed projected budget for completion of the fund raising. Specify the person or persons who will be working on the start-up phase, including how much of their time they will spend; how, if at all, they will be compensated; and their resumes and references. List applicant's seed investors, if any, with amount invested and number of shares of stock owned. Specify any additional amount of seed capital applicant is seeking, including a discussion of possible sources.
   6. 6. Describe and discuss the applicant's fund raising strategy for raising the private capital.
   7. 7. Specify the principal investor sources that the Applicant will be targeting.
   8. 8. Attach all specific financing commitments already obtained, including documentation for each. This should include the evidence of the initial required capital.
   9. 9. Describe specific demonstrations of interest from private investor sources, including documentation where possible.
   10. 10. Capital Structure. Leverage―discuss the BIDCO's plans and prospects for leveraging its capital by borrowing money, use of the SBA guarantee secondary market, or other approaches. With respect to borrowing money, describe the degree of leverage the BIDCO will seek and over what time period. Identify sources of debt financing the applicant plans to utilize. Describe how the applicant plans to structure the debt. If use of the SBA program is contemplated, discuss applicant's approach to this activity and analyze its potential profitability. If applicant is relying heavily on the SBA guarantee program, describe its alternate course of action if the SBA guarantee program is eliminated or its effectiveness significantly curtailed.

   11. 11. Financial Projections. Provide the following financial projections:

       1. a. returns-on-average assets and returns-on-capital performance projections, year by year, for a 10 year period. These projections should show summary cash flow, summary income and expense (including taxes), and summary balance sheet data. For these performance projections, operating income and expenses can be grouped by category. Specify the assumptions used for the performance projections;
       2. b. specify computer programs used for projections, if any, and specify formulas used.
   12. 12. Fee Income. Discuss the potential for fee income, and any plans that the BIDCO might have for generating fee income.
   13. 13. Complementary and Affiliate Relationships. Discuss the nature of complementary or affiliate relationships that are anticipated with banks, commercial lenders, investment bankers, venture capitalist and other institutions. This discussion can be based on general types of institutions and should identify specific institutions where complementary or affiliate relationships have already been discussed or arranged.

7. G. Application for a co-investment will contain the following information. The applicant may provide other information which it believes relevant. LEDC may request further information beyond what is specified below:

   1. 1. the proposed amount, terms, and conditions of the investment;
   2. 2. a business and funding plan for the recipient completed in accordance with the standards outlined in LEDC program material for all other LEDC programs;
   3. 3. identify all "principal shareholders" (i.e., owning directly or indirectly, or controlling directly or indirectly,
      10 percent or more of the voting stock of the BIDCO), by name with specific ownership identified;
   4. 4. the recipient must have its primary operating activities located in Louisiana, and the application of the funding must result in meaningful economic impact to the area of Louisiana where its activities are conducted.

Authority Note

AUTHORITY NOTE: Promulgated in accordance with R.S. 51:2312 (A) (7), (B) (1) and (B)(3).

Historical Note

HISTORICAL NOTE: Promulgated by the Department of Economic Development, Economic Development Corporation, LR 18:1358 (December 1992), amended LR 23:554 (May 1997), LR 26:2244 (October 2000).