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City to revolve into more business loans. The remaining payments go back to DTED. 3.0 IC Services, Inc 3.1 IC Services, a Roseville company since 1996 located at 2976 Cleveland Ave N., provides water, die, and integrated component-level processing for semiconductor manufacturers and helps clients market their products faster by functioning as an extension of an internal production line. Jeff Miller and John Cook are founders and owners ofIC Services. IC Services has experienced incredible growth over the past five years and have currently reached is production capacity. In order to continue this projected growth and meet it contracts over the next two years, IC Services must expand its manufacturing facility and purchase additional equipment. IC Services currently has 64 employees. 3.2 IC Services must purchase over $5 million in equipment to meet the projected demands for growth of the company in the next two years. To finance these expensive up front capital costs and keep the current management and business structure in place, IC Services must seek alternate sources of financing. A below market rate loan that can be provided from the Minnesota Investment Fund is critical to the company's future success. In addition, IC Services will be injecting additional equity and private investor financing and bank financing. 3.3 Based upon 45 new jobs that would be created by IC Services over the next two years, the company is eligible for $298,000 in Minnesota Investment Fund loans. Thirty-eight of the jobs would pay between $12 - $15 per hour and 7 would pay over $15 per hour. Under the program companies are eligible for $6,000 per job created between $12-$15 per hour and $10,000 per job over $15 per hour. If the jobs are not created at those wage levels, the loan must be paid back on a prorated basis. IC Services is confident that these jobs will be created at those wage levels or above. 3.4 City staff is proposing to loan the $298,000 at 4 percent interest (typical interest rates under the program) over a lO-year period. The City's loan will be secured by a first lien on the equipment purchased. The useful life of the equipment is 10 years. 3.5 The loan would be paid back in full ifIC Services relocates out of the City of Roseville or the company is sold. If the equipment becomes obsolete the City would require additional collateral and/or prepayment of the loan. City staff and the State of Minnesota will be verifying vendor warranties and useful life of the equipments prior to approval of loan documents. RCA MN Investment Fund Hearing (PF3275 11/27/00)- Page 2 of 4