Small business resource guide

G:JA
, C4-<1'S
. i~~/{, ====== SMALL s(, BUSINESS RESOURCE GUIDE
GEORGIA DEPARTMENT OF
COMMUNITY AFFAIRS
November 1996

SMALL
BUSINESS RESOURCE GUIDE
Georgia Department of Community Affairs
60 Executive Park South, N.E. Atlanta, Georgia 30329-2231 (404) 679-1593 This publication is funded in part by a grant from the Appalachian Regional Commission. An Equal Opportunity Employer Jfyou are disabled and would like to receive this publication in an alternative format, please contact the Georgia Department of Community Affairs at (404) 679-1593 or 1 (800) 736-1155 (TDD).

Contents

Introduction and Acknowledgments Secretary of State First Stop Business Information Center How to Operate a Business Legally in Georgia
THE FEDERAL SMALL BUSINESS ADMINISTRATION (SBA)
Your Business and the S.B.A How to Apply for a Small Business Loan

I MINORITY PROGRAMS

28

2 Minority Small Business Resource Organizations

29

3 Minority Business Development Agencies (MBDA) 30

Georgia Minority Subcontractors Tax Credit

31

6 OTHER PROGRAMS OF INTEREST TO

7 SMALL BUSINESSES

:

32

9 Atlanta Economic Development Corporation (AEDC) 33

Small Business Development Centers

10 United States Export Assistance Center (USEAC)

35

Headquarters: University of Georgia at Athens

10 Georgia Procurement Assistance Center (GPAC)

36

Service Corps of Retired Executives (SCORE)

13

Active Corps of Retired Executives (ACE)

13

U.S. Small Business Administration

7(a) Guarantee Loan Program

14

Participants in the U.S. Small Business Administration's Certified Lender Program & Preferred Lender Program 15

Section 504 Program

17

Georgia's Certified Development Companies

19

SBA LowDoc Program

21

GRASP SBA Microloan Program

22

Entrepreneurial Development Loan Fund

24

Small Business Investment Companies (SBIC)

26

Surety Bond Guarantee Program

27

i

Introduction andAcknowledgments

This packet contains infonnation about various federal, state and local programs that directly or indirectly benefit small businesses in the State of Georgia. The packet begins with infonnation on the Secretary of State's First Stop Business Infonnation Center. The Center should be helpful for persons who are considering starting a new business or who need infonnation on where to obtain pennits. This packet also contains the locations of small business development centers (SBDC's) throughout the state. There are a total of nineteen (19) SBDC's in Georgia and five (5) in the metropolitan Atlanta area.
We are indebted to the many agencies who have willingly provided the enclosed information. The infonnation in this packet is reprinted or summarized from their literature. This packet is not comprehensive; no packet could include all laws or programs that might

benefit small business, but it is meant to be thorough. We have tried to avoid errors; however, we suggest that businesses interested in one or more of the programs in the packet contact the agencies directly for more information. Business should be aware that these programs are updated periodically by changes in law or regulation.
We hope that this infonnation is useful in business startups and/or expansions in the State of Georgia.
For further information contact the: Georgia Department of Community Affairs 60 Executive Park South, N.E. Atlanta, Georgia 30329-2231 Ross Avina
(404) 679-1593

1

Secretary of State First Stop Business Information Center

The Secretary of State's office now offers the First Stop Business Infonnation Center for the citizens of Georgia. The center was established in 1995 after studying the problems faced by small business owners when trying to obtain clear and accessible infonnation about state and regulatory requirements.
The primary objective of this center is to facilitate sustainable small business development in Georgia by offering a central location for detennination of what licenses and pennits must be obtained and maintained by individuals and businesses conducting their enterprises in the State of Georgia.
The First Stop Business Infonnation Center provides the small business owner and the prospective entrepreneur with a central point of infonnation and contacts for state regulatory requirements for operating a small business.

For further information contact the Office of the Secretary of State at:
Suite 315 West Tower Floyd State Office Towers 2 Martin Luther King Jr. Drive Atlanta, Georgia 30334 1-800-656-4558 (404) 656-7061 (404) 657-6380 Fax (404) 656-2392 TTY Communication
Current as of: 11/96

2

How to Operate a Business Legally in Georgia

Almost everyone who starts a new business is aware that a business license is necessary to operate legally in Georgia, but what other legal requirements do the state and federal government have? What does the owner need to know about withholding tax, building occupancy permit, and sales and use tax?
Finding out this information can be difficult, since it means talking to several different agencies at the federal, state and local levels. This information is not allinclusive and should not be considered a substitute for legal assistance from a qualified attorney. Also, since the requirements are subject to change, prospective business people should contact the individual departments for the latest information.
Probably the best place to start in assimilating all this information is with the business license. Everyone is generally aware of the need for one, but not everyone knows where to get it. If located within an incorporated city limit, a license must be obtained from the city; if outside the city limits, then from the county.
Also, those who are planning to occupy a new building or use an existing one for a new business, may have to apply for a Certificate of Occupancy from the appropriate city or county zoning department.
Businesses involved in food processing or grocery sales need a food sales establishment license from the Georgia Department ofAgriculture before starting. An inspection is also required and may be requested by phone. An application for business will be accepted if the inspection shows that the establishment meets the department's requirements. Help can be obtained from the Department of Agriculture in preparing for the inspection. It is advised that business owners contact the department before investing in any renovation, equipment or plans. For information, contact: Georgia Department ofAgriculture, Consumer Protection Division, Agriculture Building, Room 306, Atlanta, Georgia 30334 (404) 656-3627
Firms engaged in cooking or preparation of food to be served, including restaurants, hotels and nursing homes, are licensed by the county environmental health departments.

Categories of business that concern the public interest also are subject to special permits, licensing and inspection. This includes schools, nurseries, motor transport, public entertainment, employment agencies, securities dealers and financial institutions. Contact the State of Georgia Information line at (404) 656-2000 for the number of the correct agency. .
Businesses which sell alcoholic beverages must have a state alcoholic beverage license and a local license which is obtained from either the city or county in which the store is located. The application forms for the licenses must be completed before the business is opened. Local authorities and the Department of Revenue can be of assistance in preparing the application. For information and application forms from the state contact: Department of Revenue, Alcohol & Tobacco Unit, 801 Trinity-Washington Building, Atlanta, Georgia; (404) 656-4252
Taxes cannot be ignored, of course. Business owners are required by law to withhold the following from the wages paid to employees: federal income taxes, state income taxes and FICA (Social Security) Insurance.
Income taxes will also be levied by the federal and state governments on earnings of any business. Therefore, each business must file an income tax return with both agencies. Businesses may be required to file estimated tax returns and pay estimated taxes on a quarterly basis.
For federal tax information, contact: U.S. Internal Revenue Service, 275 Peachtree Street, N.E., Atlanta, Georgia 30303; (404) 522-0050
State tax information can be obtained from: Georgia Department of Revenue, Georgia Income Tax Division, Post Office Box 38067, Atlanta, Georgia 30334; (404) 656-4092

3

The IRS has a number of publications that are available upon request to small businesses. One of the most helpful is "Your Business Tax Kit", which includes data and forms for a Federal Employer Identification Number and a tax guide for small businesses that can be ordered by calling Forms and Publications at 1-800829-3676 or through a visit to the IRS office.
In Georgia there is a 4 percent sales and use tax which applies to the retail purchase, retail sale, rental, storage, use or consumption of tangible personal property and certain services. In other words, sales tax must be collected on just about every tangible item sold, except for the exempt categories of prescription drugs, eyeglasses and contact lenses.
A sales tax number is required for each business before opening. The number plus instructions for collection, reporting and remitting the money to the state on a monthly basis can be obtained from: Georgia Department of Revenue, Sales and Use Tax Division, Registration Section, 31 0 Trinity-Washington Building, Atlanta, Georgia 30334 (404) 656-4060. In addition, some counties have exercised local option issues to increase their sales and use tax to pay for certain projects.
Businesses are required by the state to pay unemployment insurance tax if the company has one or more employees for 20 weeks in a calendar year, or it has paid gross wages of $1 ,500 or more in a calendar year. The taxes are payable at a rate of 2.7 percent on the first $8,500 in annual wages of an employee. Unemployment insurance must be reported and returns made to the state. For information contact: Georgia Department of Labor, Adjudication Section, Sussex Place, 148 International Boulevard, Suite 850, Atlanta, Georgia 30303-1751 (404) 656-5590.

If a business employs three or more, workers' compensation insurance must be carried to provide protection to those injured on on-the-job accidents. The State Board ofWorkers' Compensation aids people who need claim assistance. For information contact: State Board of Workers' Compensation, 270 Peachtree Street N.W., Atlanta, Georgia 30303-1299 (404) 656-3875.
Virtually all business entities are subject to the federal minimum wage, overtime and child labor laws.
Information on these laws and other federal laws pertaining to labor, may be obtained from: Daniel Bremer, District Director, U.S. Department of Labor, Wage and Hour Division, Room 668 1375 Peachtree Street, N.E., Atlanta, Georgia 30367 (404) 347-4258.
Incorporating a business allows a firm to take advantage of the limited liability of a corporation. A corporation is usually a taxpayer separate from its owners, unless the company decides it wants to be an "S" corporation for special tax consideration. Contact an attorney or accountant for information on just what each designation can mean to the firm.
Legal assistance will be needed to incorporate. Basically, this involves checking with the Secretary of State to see if the name chosen for the business is available. Typed Articles of Incorporation must then be submitted, along with a fee. Additionally, a notice of incorporation must be published in the official legal newspaper for the county. There is also a fee for this printing. Each business must submit a consent from a person who will act as registered agent for service of process on the corporation. This consent must be filed along with the Articles of Incorporation. The articles must name at least three directors, unless the corporation will have two or fewer shareholders. For more information, contact: Secretary of State, Corporations Division, 306 West Tower, Floyd Building, Two Martin Luther King Jr. Drive, S.E., Atlanta, Georgia 30334; (404) 656-2185.

4

Trademarks and service marks may be registered under federal laws or state laws. In Georgia, an application form should be filed, along with a $15 fee and copies of the trademark or service mark. Registration is then good for 10 years. In Georgia contact: Special Services Division, Secretary of State, Corporations Division, 306 West Tower, Floyd Building, Two Martin Luther King Jr. Drive, S.E., Atlanta, Georgia 30334 (404) 656-2861
For federal information contact: U.S. Department of Commerce, Trademark Office, 2021 Jefferson Davis Highway, Arlington, Virginia 22202 (703) 305-8341 (703) 308-9000 (800) 786-9199

Businesses that use any name other than the owner's must register this fictitious name with the county as required by the Trade Name Registration Act. This registration requirement does not apply to corporations doing business under their corporate names or to those practicing any profession under a partnership name. For information contact the Clerk of the Superior Court for the county in which the business is located.
And last but not least, if an established business is to be bought, the purchaser must comply with the Bulk Sales Law. This law requires that at least five days before the actual purchase, each creditor must be personally notified of the proposed sale. In counties of more than 200,000 population, this intent must be published at least one time in the county legal newspaper not less than seven days prior to completion of the purchase. An attorney should be consulted about this procedure.

5

The Federal Small Business Administration
(SBA)
6

Your Business and the S.B.A.

The U.S. Small Business Administration is a small Surety Bonding:

independent federal agency created by Congress in 1953 SBA is committed to making the bonding process

to assist, counsel and champion the millions of accessible to small and emerging contractors who, for

American small businesses.

whatever reasons, find bonding unavailable to them.

The mission of SBA is to help people get into business and stay in business. To do this, SBA acts as an advocate for small business. At the direction of Congress, the Agency espouses the cause of small business, explains small business's role and contributions to our society and

The Agency is authorized to guarantee to a qualified surety up to 90% of losses incurred under bid, payment, or performance bonds issued to contractors on contracts valued up to $1.25 million. For further information call (404) 347-0210.

economy and advocates policies that help small business. Small Business Investment Companies (SBIC):

The Agency also provides new and established small SBA licenses, regulates and provides financial

business owners with financial assistance, management assistance to privately owned and operated small

counseling and training. SBA helps small firms get a fair business investment companies. Their major function

share of government and assists in the bonding process. is to make "venture" or "risk" investments by supplying

equity capital and by extending unsecured loans and

Advocacy

loans not fully collateralized to small business

Congress specified these basic statutory duties for enterprises. SBIC's are privately capitalized and obtain

SBA's Office of Advocacy:

financial leverage from SBA. They are intended to be

Serve as a focal point for feedback concerning the profit-making corporations.

policies and activities of any part of the executive branch of the federal government which affects small business.
Counsel small businesses in dealing with the federal government.
Represent small businesses before other federal agencies.

Business Development:
Statistics show that most small business failures are due to lack ofgood management. For this reason, SBA places special emphasis on improving the management ability of small business owners and managers. The Agency's Business Development program includes free individual counseling, courses, conferences, workshops, problem

Enlist the help of government and private groups to disseminate information about the federal government.
Financial Assistance

clinics and a wide range of publications.
SCORE & ACE: SCORE (Service Corps of Retired Executives) and ACE (Active Corps of Executives) help current and

SBA offers a variety of loan programs to eligible small prospective small business owners solve their business

business concerns which cannot borrow on reasonable problems and make long range plans by providing free

terms from conventional lenders without government counseling and conducting low cost workshops and

help. There are two types of regular business loans: seminars. (According to an Atlanta Journal article dated

Direct loans from SBA (very limited).

4/5/95, the Atlanta SCORE Chapter was ranked #1 in

Guaranty loans, under which SBA guarantees up to the nation).

90% of the loan which bank or other private lenders

agree to make.

Small Business Institutes (SBI):

Regular business loans may be used for: Building construction, expansion, or conversion Purchase of machinery and equipment, furnishings,
and fixtures
Inventory

SBI's are located on college and university campuses throughout Georgia. At each SBA school, senior and graduate students of business administration and their faculty advisors provide free, on-site management counseling to small firms.

Working Capital

7

Small Business Development Center (SBDC):
SBDC is headquartered at the University of Georgia in Athens, provides free managerial and technical counseling, management training programs, research studies and other types of specialized assistance to small businesses. There are 19 sub-centers are located strategically throughout Georgia to provide these services.
Procurement Assistance:
Each year the federal government contracts to purchase billions of dollars worth of goods and services from private companies. SBA helps businesses obtain a fair share of this governmental business, as required by law.
Procurement specialists in the Atlanta Regional Office counsel small businesses on how to prepare bids and obtain prime contracts and subcontracts, direct them to government agencies that buy the products or services small firms supply, help get their names on bidders lists and assist in obtaining drawings and specifications for proposed purchases. For more information call the Procurement Office at (404) 347-7587.

Business Information Center:
A state of the art business information center, known as the BIC was formally opened in October, 1992. Located in the Atlanta District Office, the BIC features seven DELL Corp. personal computers, two Apple MacIntosh computers, four VCR units for the facility's library of small business topics, two Epsons and one Personal Laser Writer printer. The BICis open Monday through Friday, 8:00 A.M. to 4:00 P.M., and is available to the small business person free of charge.
For further information contact:
The Small Business Administration 1720 Peachtree Road, N.W. Suite 600 Atlanta, Georgia 30309 (404) 347-2441

Procurement Automated Source Systems (PASS):
This computerized system lists the names of small companies and their capabilities so that federal procurement officers, procurement officials and private contracts can readily locate small firms capable of performing federal work. PASS computer terminals are located in the SBA's 10 regional offices and in the offices of more than 125 major federal procurement officials and private prime contractors. Contact any SBA office to obtain the appropriate PASS forms.

Special Emphasis Areas:
SBA makes special efforts to help Veterans, Women and Minorities to get into business and become successful business owners and managers.

8

How to Apply for a Small Business Loan

Take the Following Information to your Banker and Discuss Your Financial Requirements With Him/Her
1. State the kind of business to be established or expanded in enough detail to describe the nature of the proposed operations.
2. State the total investment required for your business and the amount of funds you will provide. Expenditures of loan proceeds should be designated for machinery, equipment, inventory, operating expenses, etc.
3. Describe organization of the business: proprietorship, partnership, or corporation. If the business is to be operated under a franchise agreement, please bring or forward a copy of the agreement.
4. State your experience and management capabilities.
5. If it is an existing business, have a Profit and Loss Statement for the previous full year and for the current year-to-date. Interim statements must not be over 90-days old.
6. If it is an existing business, prepare a current Balance Sheet (dated within 90-days) showing all assets and liabilities pertaining to the business. Also, provide one from the last year-end.
7. Prepare a current Personal Financial Statement of the owner or each partner or stockholder owning 20% or more of the voting stock.

8. Prepare a list of collateral which will be offered as security, showing date of purchase, its original cost and your estimate of present value.
9. Prepare a detailed estimate of earnings for the next two (2) years and show total sales, cost of sales, total operating expenses, and net profit. .
If the bank is unwilling or unable to lend the requested amount or to give the terms desired, ask whether or not they would make the loan with an SBA guaranty of up to 90%. If the bank considers the loan request workable within an SBA guaranty, they should give you an SBA application to fill out and they will, in tum, forward the application package to the SBA for consideration. If approved, the loan will be disbursed through the bank.
NOTE: By law, the Agency may not make a loan ifa
business can obtain funds from a bank or other private source. You, therefore, must seek private financing before applying to the SBA.
Effective October 1, 1985, the regular SBA Direct Loan Program was discontinued. There is limited funding for direct loans to Vietnam Era Veterans (August 5, 1964-May 7, 1975), Disabled Veterans with 30% or more service connected disability, and persons with eligible handicaps. Direct loan applicants must first seek private financing and all applications are considered on a case-by-case basis.

9

Small Business Development Centers

Headquarters: University of Georgia at Athens

Although listing sources of technical assistance is not the primary purpose of this publication, the Small Business Development Centers (SBDC's) are the primary way that Georgia tries to meet the needs of small business owners and would-be business owners when they have questions about the fundamentals of business operations. Examples ofthe kind of assistance provided include: business plan development, market research, record keeping and accounting, cash flow

analysis, financing alternatives and international trade. The University of Georgia System also provides specialized information and assistance to businesses on topics ranging from agriculture to industrial engineering. The SBDC's are referral sources for this specialized assistance. Listed below are the cities and telephone numbers of the SBDC's in Georgia. They are funded by both the University System and the U.S. Small Business Administration.

STATE OFFICE-Hank Logan, State Director
University of Georgia Chicopee Complex I I 80 East Broad Street Athens, Georgia 30602-54 I2 (706) 542-7436 Gist 241-7436 FAX: (706) 542-6776
NORTHEAST GEORGIA DISTRICT SBDC
AUGUSTA SBDC Jeff Sanford, Center Manager 106I Katherine Street Augusta, Georgia 30904-6 I05 (706) 737-1790 FAX: (706) 737-7937

DEKALBSBDC Eric Bonaparte 750 Commerce Drive Decatur, Georgia 30030-2622 (404) 373-6930 FAX: (404) 687-9684

GAINESVILLE SBDC Ron Simmons, Center Manager 456 Jesse Jewel Parkway, Suite 30 Gainesville, Georgia 30501-4203 (770) 531-5681 FAX: (404) 531-5684

GWINNETT SBDC Robert Andoh, Center Manager Gwinnett Technical Institute 1250 Atkinson Road Lawrenceville, Georgia 30246 (770) 806-2124 FAX: (404) 339-2329

NORTHWEST GEORGIA DISTRICT SBDC-Robert Dickson, District Director

CLAYTON STATE COLLEGE SBDC Alex Ferdinand, Center Manager Post Office Box 265 Morrow, Georgia 30260 (770) 961-3440 FAX: (404) 961-3428

FLOYD COLLEGE SBDC Drew Tonsmeire, Center Manager Post Office Box 1864 Rome, Georgia 30162-1864 (706) 295-6326 FAX: (706) 295-6732

continues on next page IkF 10

NORTHWEST GEORGIA DISTRICT SBDC-eontinued

GEORGIA STATE SBDC Lee Quartennan, Center Mgr. University Plaza, Box 874 Atlanta, Georgia 30303-3083 (404) 651-3550 FAX: (404) 651-1035

KENNESAW STATE COLLEGE SBDC Carlata Roberts, Center Manager Post Office Box 444 Marietta, Georgia 30061 (770) 423-6450 FAX: (404)423-6564

MORRIS BROWN COLLEGE SBDC Ray Johnson, Center Manager 643 Martin Luther King Jr. Dr. N.W. Atlanta, Georgia 30314 (404) 220-020 I FAX: (404) 220-0236

DALTONSBDC Mike Doyle, Center Manager Dalton College Technical Building, Room 112 213 North College Drive Dalton, GA 30720 (706) 272-2707 FAX: (706) 272-2701

SOUTHEAST GEORGIA DISTRICT SBDC -David Mills, District Director

BRUNSWICK SBDC 1107 Fountain Lake Drive Brunswick, Georgia 31525-3039 (912) 264-7343 FAX: (912) 681-0648

MACONSBDC Denise Ricketson, Center Manager Post Office Box 13212 Macon, Georgia 31208-3212 (912) 751-6592 FAX: (912) 751-6607

SAVANNAH SBDC Harry O'Brien, Center Manager 450 Mall Boulevard, Suite H Savannah, Georgia 31406-4824 (912) 356-2755 FAX: (912) 353-3033

STATESBORO SBDC David Lewis, Center Manager Landrum Center, Box 8156 Statesboro, Georgia 30460 (912) 681-5194 FAX: (912) 681-0648

WARNER ROBINS SBDC Ron Reaves, Center Manager 151 Osigian Boulevard Warner Robins, Georgia 31088 (912) 953-9356 FAX: (912) 953-9376

11

SOUTHWEST GEORGIA DISTRICT SBDC
Sue Ford, District Director
ALBANYSBDC Sue Ford, Center Manager 230 S. Jackson Street Suite 333 Albany, Georgia 31701-2885 (912) 430-4303 FAX: (912) 430-3933
VALDOSTA SBDC Suzanne Barnett, Center Mgr. Baytree West Professional Office 1205 Baytree Road, Suite 9 Valdosta, Georgia 31602-2731 (912) 245-3738 FAX: (921) 245-3741

COLUMBUSSBDC Tom Snyder, Center Manager 928 45th Street, North Building Room 523 Columbus, Georgia 31904-6572 (706) 649-7433 FAX: (706) 649-1928
LAGRANGESBDC David Baldwin, Center Manager LaGrange College 601 Broad Street LaGrange, GA 30240 (706) 812-7353 FAX: (706) 845-0391

12

SCORE & ACE

Service Corps of Retired Executives (SCORE)
Active Corps of Retired Executives (ACE) Sponsored by U.S. Small Business Administration
SCORE is Free counseling for small businesses A non-profit association of retired executives with
25 years of counseling experiences Brains, ideas, skills and experience Volunteers ready to share their skills and insight

Georgia SCORE Chapters

Atlanta

1720 Peachtree Road, N.W Suite 600, North Tower Atlanta, Georgia 30309 (404)347-2441 (Voice mail box to order brochures) (404) 347-2460 (To speak with a counselor)

Athens

Gerald Rucker 340 Weatherly Woods Drive Winterville, Georgia 30683 (706) 545-5965

Augusta

c/o Executive Tax Service 106 Pleasant Home Road LePavillion Center, Suite 2-R Augusta, Georgia 30907 (706) 869-9100

Columbus

1st Union Bank 101 13th Street Columbus, Georgia 31902 (706) 596-8331

Dalton

P. O. Box 1941 305 Thornton Avenue Dalton, GA 30720 (706) 278-7373

Savannah

Trust Company Bank 33 Bull Street, Suite 580 Savannah, Georgia 31401 (912) 652-4335

13

u.s. Small Business Administration
7(a) Guarantee Loan Program

Small Business Administration (SBA) loans and loan guarantees are available to businesses which cannot borrow on reasonable terms from conventional lenders. Two major programs exist: the 7(a) or regular loan guarantee program and the 504 or Certified Development Company program. Normally, the limit of SBA assistance to anyone borrower whether participating in one or both programs is $750,000. Total project costs can be much higher with private and other public sources providing additional financing.

Use of Loan Proceeds Land and Building Acquisition Inventory Machinery and Equipment Working Capital Renovation of Building Accounts Receivable Leasehold Improvement Refinancing of Current and Secured Debt

Business Eligibility Eligible businesses include for-profit businesses
only. Ineligible businesses include:
Non-profit organizations Passive income and real estate companies Developer/landlord deals Financial institutions Religious institutions
Business Size Standards Manufacturing businesses cannot employ more than
500 people, unless otherwise specified in the Standard Industrial Classification (SIC) code. Retail and service businesses cannot have more than $5 million in sales, unless otherwise specified in the SIC code. Wholesale business cannot employ more than 100 people unless otherwise specified in the SIC code.
'IYpe of Financing Borrower must be the user of the loan proceeds.
Loan Amount Up to $750,000 total SBA exposure per small
business concern. SBA can guarantee up to 80% of loans for $100,000 or less and up to 75% of loans for more than $100,000, up to a maximum of $750,000. The percentage SBA guarantees depends on the project.

Repayment Term The bank sets the loan term from 1 to 25 years
depending on the purpose, use of proceeds, ability to repay, and the useful life of the assets being purchased.
Interest Rate The bank determines the interest rate. The SBA
guarantee is available only if the bank's interest rate does not exceed 2.75% above "the New York prime rate" on a loan with a repayment term of 7 years or more and 2.25% on a loan with a repayment of less than 7 years.
Down Payment The cash or equity injection of the small business
concern varies depending on the collateral pledged to secure the loan, the viability of the project, and the profitability of the company. This requirement could vary from 10% to 40% depending on these factors.
Refinancing Loans can be refinanced under certain conditions at
the discretion of the SBA.
Basic Credit Criteria Adjusted cash flow must be sufficient to service the
debt. Adequate collateral sufficient to secure the loan. Personal guarantees required of the major principals
or owners.

Loan Servicing The bank services the loan.

continues on next page IEF 14

Fees

Participants in the u.s. Small Business Administration's



Guaranty fee of 2% on the guaranteed amount of the loan

Certified Lender Program & Preferred Lender Program

paid to the SBA.

This list includes only those banks

Usual and customary fees charged with CLP and/or PLP status as of

by the bank which are dictated by 8/6/96. All banks are eligible to

the bank.

participate in SBA's Guaranteed

The legal and closing fees are paid Loan Programs.

by the borrower.

*Colonial Bank 500 Northridge Road Suite 200 Atlanta, GA 30350 David Boehmig (770) 642-0800

Source of Funds

*AT&T Capital Corporation

The bank provides the funds and 500 Chastain Center Blvd. the SBA provides a guarantee to Suite 555

the bank.

Kennesaw, GA 30144 Doug Hood

Benefits of an SBA

(404) 514-4428

Community Bank & Trust P. O. Box 1900 Cornelia, GA 30531 William M. Galardi (706) 778-2265

Guaranteed Loan

*BDC of Georgia, Inc.



Encourages the bank to make the loan because the SBA guarantee decreases the bank's exposure and increases the bank's liquidity.

4000 Cumberland Parkway Suite 1200-A Atlanta, GA 30339 Tom Dorman

Provides banks with a marketable (404) 434-0273

security guaranteed by the federal

government.

*Bank of America

Improves the bank's loan volume 1230 Peachtree Street

and quality.

Suite 3600

Atlanta, GA

Reduces or limits the bank's Timothy D. Smith

credit risk.

(404) 249-6981

Provides loans to small

businesses which are not Bank of Coweta

available otherwise.

P. O. Box 1218



Provides loan applicants with longer maturity.

Newan, GA 30264 J. Daniel Preston, Jr. (770) 253-1340

*Eastside Bank & Trust P.O. Box 1428 Snellville, GA 30278 Frayne Bentley (404) 979-2265
Fidelity National Bank P.O. Box 105075 Atlanta, GA 30348 Daniel Ford (404) 240-1525
*First Capital Bank 1725 Indian Trail Road Norcross, GA 30093 Kathleen Bradford (404) 921-6400
First Colony Bank 300 South Main Street

For further information contact: Bank of North Georgia

The Small Business Administration 12355 Arnold Mill Road

(SBA)

Alpharetta, GA 30201

1720 Peachtree Street, Suite 600 Joy Manbeck

Atlanta, Georgia 30309

(770) 664-7861

(404) 347-2441

Note: You may also contact your *The Coastal Bank

local bank or any ofthe

P.O. Box 9747

preferred lenders listed on Savannah, GA 31412-9747

the following pages.

William L. Kleinpeter

Current as of: 6/95

(912) 235-4400

Alpharetta, GA 30201 Robert J. Shaw (404) 355-1922
First National Bank of Alma P.O. Box 2028 Alma, GA 31510 Zach Johnson (912) 632-7262
*First National Bank of Cherokee
1589-C Highway 92 N

Box 1238

,Woodstock, GA 30188

*Denotes Preferred Lender Status

Donna Pierson (404) 591-9000

15

*First South Bank, N.A. P.O. Box 14099 Macon, GA 31203-4099 H. Randolph Lee, Jr. (912) 477-4428
*First State Bank & Trust Co. P.O. Box 280 Cordele, GA 31015 Jeff Johnson (912) 273-1631
*Georgia Bankers Bank 3715 Northside Parkway Suite 800, Bldg. 300 Atlanta, GA 30327 Ken Vassey (404) 848-2900
Gulf Coast Bank & Trust Co. 4515 Chamblee-Dunwoody Rd. Suite #149 Atlanta, GA 30338 Juan Lago (404) 936-9015
Habersham Bank P.O. Box 1980 Cornelia, GA 30531 Daryl Grinstead (706) 778-1000
Middle Georgia Bank P.O. Box 25, Main Street Byron, GA 31000 W. L. Brown (912) 956-4300
*Milton National Bank 11650 Alpharetta Highway Roswell, GA 30076 Mark Bryant (404) 664-1990
*Money Store Investment Corp. 2970 Clairmont Rd. NE, Suite 800 Atlanta, GA 30329 Frank Talluto (404) 636-4075

Mountain National Bank P.O. Box 49 Tucker, GA 30085-0049 Dale Earnhart (404) 491-8808

*Union County Bank P.O. Box 398 Blairsville, GA 30512 Steve Cockerham (706) 745-2151

*NationsBank P.O. Box 4685 Atlanta, GA 30302 Paul Hinds (404) 607-5727
Regions Bank 6637 Roswell Road Atlanta, GA 30328 Susan Battle (404) 255-8550
*Southern Crescent Bank 1585 Southlake Parkway Morrow, GA 30260 Robert Quinton (404) 968-6868
*SouthTrust Bank of Georgia, N. A. 150 East Ponce de Leon Avenue Suite 425 Decatur, GA 30030 John. R. McArthur (404) 841-2184
*The Summit National Bank 4360 Chamblee-Dunwoody Road Atlanta, GA 30341 Andree London (404) 454-0441
SunTrust, Atlanta P. O. Box 4418, MC 31 Atlanta, GA 30302 Dedee Padgette (404) 624-2995

Vine Street Trust 5901-C Peachtree Dunwoody Road S-420 Atlanta, GA 30328 Brian C. Faulk (770) 551-8822
*Zions First National Bank 3390 Peachtree Road, N.E. Suite 900 Atlanta, GA 30326 Michael Schwartz (404) 238-0878
Certified lenders have the expertise to originate and process SBA loans and receive SBA decision on loan guarantee applications within three working days. Preferred lenders have the ability to originate, process and service loans backed by SBA guarantees. Preferred lenders do not need SBA approval for each guarantee application, but SBA does review preferred lenders' guaranteed loan portfolio periodically. (Preferred lenders, without prior SBA approval, may only guaranteed up to 70% ofloan principal.)

Thcker Federal S&L Association 2985 W. Frank Gordy Parkway Marietta, GA 30066 Robert Garcia (404) 977-6688

16

Section 504 Program

Small Business Administration (SBA) loans and loan guarantees are available to small businesses which cannot

borrow on reasonable terms from conventional lenders. Two major programs exist, the 7(a) or regular loan

guarantee program and the 504 or Certified Development Company (CDC) program. The 504 loan program is a

long-term, fixed asset, subordinated mortgage financing program for healthy and expanding small businesses as

well as start-ups. Debentures guaranteed by SBA are pooled and sold in the private market in order to fund the

loan proceeds. The limit of SBA assistance to anyone borrower participating in one or both programs is $750,000.

(If certain policy objectives are met, the limit of assistance for the 504 program is $1,000,000.) Total project

costs will be much higher with required private sector and owner's equity financing.

.

ELIGIBLE BUSINESSES
Must be for profit corporation, partnership, or proprietorship;
Net worth must not exceed $6 million; Average net profit after tax not to exceed $2 million
for the last 2 years; The small business applicant must be the user of the
fixed assets financed; The project financed should stimulate economic
development and create one job per $35,000 of the SBA debenture amount; Meet industry-specific definitions of a small business as determined by SBA.
ELIGIBLE USE OF PROCEEDS
Purchase land; Make site improvements to land; Acquire existing building; Construction or renovation; Purchase machinery & equipment with a useful life
of at least 10 years; Make a major addition to an existing building; A contingency up to 10% of the project cost for a
project involving construction; Some professional fees necessary to the project
(survey, appraisal) Leasehold improvements to an existing building with
a minimum useful life of 20 years.

INELIGIBLE BUSINESSES
Non-profits Passive income and real estate companies Financial institutions or any enterprise primarily
engaged in the business of lending or investing Developer/Landlord Projects

INELIGIBLE USE OF PROCEEDS Refinancing Counseling or consulting fees Finders fees Origination fees Working Capital Short life assets (inventory, vehicles, or office furniture) Private lenders closing costs Venture capital Repayment or consolidation of existing debt

TYPICAL LOAN STRUCTURE AS A % OF PROJECT COST:

Bank

50% 45% 40%

35%

SBA

40% 40% 40%

35%

Business 10%

15% 20%

30%

Total

100% 100% 100% 100%

17

COMPARISON OF CDC LOAN WITH PRIVATE SECTOR LOAN

Maximum Loan Amount Minimum Loan Amount Term of Loan Rate of Interest Collateral
Job Creation

CDC Portion Maximum debenture amount is $750,000 for anyone business (or $1,000,000 for certain public policy objectives)
At least $50,000 - All loans are in increments of $1,000.
Maturity of 10 or 20 years. Based on weighted useful life of the assets being purchased with the proceeds of the loan.
Fixed, below commercial, determined on date of debenture sale Tied to U.S. Treasury Bonds of 5 and 10 year terms.
Subordinated mortgage in assets purchased with loan. Always requires a Personal Guarantee and key person life insurance.
Must create one new full-time job for each $35,000 of the SBA debenture within 2 years of the loan closing.

Private Sector Lender Portion No maximum-Bank share must be at least equal to or greater than the SBA portion.
Equivalent amount to SBA portion.
At least 7 years for a 10 year debenture. At least 10 years for a 20 year debenture.
Up to bank and small business to negotiate. May be fixed or variable Must be "Reasonable".
Secured by first mortgage position with assets purchased with the loan.
No job creation requirement

Incentives to the Small Business Concern Long Term (10 or 20 years) Low down payment (10%) on fixed asset purchase Reasonable and fixed rate Loan can be prepaid with no penalty after half the term

For more information contact: The local Certified Development Company on the following page.
Current as of: 6/96

Advantages to Financial Institutions
Private sector lenders make their own credit decisions
Improves their loan quality by providing 50% of the loan amount and receiving 100% first collateral mortgage position
Set their own rates and fees Offers their small business customers a better deal-
Reduced debt service, better cash flow and within individual loan limits leaves funds available for other types of financing.
18

continues on next page lJJ.;F

Georgia's Certified Development Companies
ATLANTA LOCAL DEVELOPMENT CORPORATION
Mr. Walter Huntley, Jr., President 230 Peachtree Street, NW, Suite 1650 Atlanta, Georgia 30303 (404) 658-7000 City of Atlanta Only Lonnie Saboor, Contact Person
THE BUSINESS GROWTH CORPORATION OF GEORGIA
Mr. Gordon Bradl, President 4000 Cumberland Parkway, Suite 1200-A Atlanta, Georgia 30339 (404) 434-0273 State Wide Vicki Schoen, Contact Person
CERTIFIED DEVELOPMENT COMPANY OF N.E. GEORGIA
Mr. Jim Dove, President 305 Research Drive Athens, Georgia 30610 (706) 548-3141 Chris McGahee, Contact Person
COASTAL AREA DISTRICT DEVELOPMENT AUTHORITY
Mr. James Floyd, President Post Office Box 1917, 127 "F' Street Brunswick, Georgia 31521 (912) 264-7363
CSRA LOCAL DEVELOPMENT CORPORATION
Mr. Robert Fries, President 2123 Wrightsboro Road Post Office Box 2800 Augusta, Georgia 30904 (706) 737-1823 Randy Griffin, Contact Person
SMALL BUSINESS ASSISTANCE CORPORATION
Mr. David Byck, President 31 West Congress Street Savannah, Georgia 31401 (912) 232-4700 Chatham County Only Tony O'Reilly, Contact Person

ECONOMIC DEVELOPMENT CORPORATION OF FULTON COUNTY
Mr. Edward Nelson, President 141 Pryor Street, Suite 5001 Atlanta, Georgia 30303 (404) 730-8073 Colleen Robbs, Contact Person
GEORGIA MOUNTAINS REGIONAL ECONOMIC DEVELOPMENT CORPORATION
Mr. W.L. Savage, President 1010 Ridge Road Gainesville, Georgia 30501 (707) 536-3431
HEART OF GEORGIA LOCAL DEVELOPMENT CORPORATION
Mr. Frank Radford, Jr. President 501 Oak Street Eastman, Georgia 31023 (912) 374-4771 John Lee, Contact Person
MIDDLE FLINT AREA DEVELOPMENT CORPORATION
Mr. Rufus Greene, President 228 West Lamar Street Americus, Georgia 31709 (912) 928-8729 Bobby Lowe, Contact Person
NORTH GEORGIA CERTIFIED DEVELOPMENT CORPORATION
Mr. J.L. Hufstetler, President 503 West Waugh Street Dalton, Georgia 30720 (706) 272-2300 Charles Millirons, Contact Person
OCONEE AREA DEVELOPMENT CORPORATION
Mr. C.D. Gamer, MD, President Post Office Box 707 Milledgeville, Georgia 31060 (912) 453-5327

19

SOUTH GEORGIA AREA DEVELOPMENT CORPORATION
Mr. Gerald Thompson, President 327 West Savannah Avenue Post Office Box 1223 Valdosta, Georgia 31601 (912) 333-5281 Don Chauncey, Contact Person
SOUTHEAST GEORGIA DEVELOPMENT CORPORATION
Mr. Ken Hayes 3395 Harris Road Waycross, Georgia 31501 (912) 285-6097
SOUTHWEST GEORGIA ECONOMIC DEVELOPMENT CORPORATION
Mr. Jack Brannon, President 30 East Broad Street, P.O. Box 346 Camilla, Georgia 31730 (912) 336-5617 Robert Murray, Jr., Contact Person

TROUP COUNTY LOCAL DEVELOPMENT CORPORATION
Mr. Fred Turner, President Post Office Box 357 LaGrange, Georgia 30241 (706) 883-1655 Troup County Only Alesia Nixon, Contact Person
UPTOWN INC. Mr. J.D. Kirven III, President Post Office Box 1237 Columbus, Georgia 31902 (706) 571-6057 Muscogee County Only

20

Low Doc SBA's New Quick & Easy Lending Program

QUICK SBA turnaround

Interest Rates

EASY one page SBA application
LowDoc simplifies the application process. LowDoc provides a rapid response from SBA - usually
only two or three days. LowDoc focuses on character, credit and experience LowDoc is for small business loans of $100,000 or
less. SBA guarantees up to 90 percent of the loan. The applicant completes the front of a one-page SBA
application; the lender completes the back. Lenders may require additional information from the applicant. For loans over $50,000, the applicant includes a copy of U.S. Income Tax Schedule C or the front page of the corporate or partnership returns for the past three years. Personal financial statements are required for all guarantors.
Who is eligible:

Applicants negotiate terms with the lender. Interest rates are tied to the prime rate and may be
fixed or variable; however, they cannot exceed SBA maximums: -For loans of less than seven years, up to 2.25 percent over prime; -For loans of seven years or longer, up to 2.75 percent over prime;Loans under $50,000 may be subject to slightly higher rates.
Maturity
Length of time for repayment depends on -The ability to repay and -The use ofthe loan proceeds; however -It may not exceed 25 years for fixed assets or 10 years for all other uses
For more information call our voice-mail system at (404) 347-2441 or visit with us at: 1720 Peachtree Road, Suite 600 Atlanta, Georgia 30309

Entrepreneurs starting or expanding a business
Businesses whose average annual sales for the preceding three years do not exceed $5 million and employ 100 or less, including affiliates.
Businesses that satisfy other statutory criteria

21

GRASP SBA MICROLOAN PROGRAM

GRASP was founded in 1986 to provide a comprehensive approach for the development and growth of small businesses. GRASP delivers practical business development services to help you succeed in today's competitive world. Our SBA Microloan Program helps you finance your business's growth and expansion.

BACKGROUND:

In May 1993, the U.S. Small ELIGffiILITY:

Business Administration Borrowers must: Participate in an intensive

(SBA) in Washington, D.C.

technical assistance program

selected GRASP as one of 51

established by GRASP before

new lenders of its Microloan

and after loans are made. This

Demonstration Program. There

may include training and/or

are 96 lenders in 44 states.

management counseling.

PURPOSE: AMOUNT: TERMS: FEES:

Loans are to assist women, low income, minority entrepreneurs, small business owners, and other such individuals possessing the capability to operate successful businesses.
The average loan is expected to be about $7,500. The amount will vary up to a maximum of $25,000 per loan.
The term is based on the type of loan, the quality of and makeup of collateral, and the needs ofthe borrower. The term may not exceed six years. The targeted average term is three years.
Fees will be charged for credit reports and closing costs directly incurred by GRASP. In addition, you will pay no more than $100 for pre-loan assistance before you receive a loan.

Have business plans approved by GRASP.
Be located in Clayton, Cobb, DeKalb, Douglas, Fayette, Fulton, Gwinnett, Henry, or Rockdale counties.
Have less than 10 employees. The SBA has set maximum size standards which vary from industry to industry.
Meet type-of-business eligibility requirements established by the SBA.
Comply with regulations which prohibit discrimination based on race, color, religion, sex, marital status, disability, age or national origin.

RATES:

11.625% per annum for loans of $7,500 or less, and 10.875% per annum for loans more than $7,500.

22

INELIGffiLE BUSINESSES:
The following types of businesses are ineligible for the SBA Microloan Program: Charitable and non-profit organization. However,
for-profit enterprises owned by non-profit organizations are eligible.
Media businesses, such as those dealing with the creation, origination, expression or distribution of ideas, values, thoughts or opinions. This includes theaters, specialty stores, delivery and transportation concerns limiting themselves to the sale or distribution of ineligible materials.
Academic schools, including denominational nurseries, kindergartens and pre-schools. However, technical, secretarial, vocational, and trade schools are eligible.
Floor planning concerns.
Gambling concerns. However, eligible small business concerns which derive less than 1/3 of their income from the sale of lottery tickets are eligible.
Businesses involved in speculation of any kind, including real estate, stocks, bonds or commodities.
Businesses primarily engaged in lending or invested.
Pyramid sales distribution plans.
Loans to applicants engaged in illegal activities.
Loans to persons on probation or parole, and loans to persons who have defaulted on any government obligation or any SBA guaranteed loan.

For further information contact:
GRASP Microloan Program 55 Marietta Street Suite 2000 Atlanta, Georgia 30303 (404) 659-5955 Current as of: 11/96

USE OF PROCEEDS:
Loan proceeds may be used for working capital, inventory, supplies, furniture, fixtures, machinery, or equipment. The use of loan proceeds to purchase real estate or leasehold improvements is prohibited.

23

Entrepreneurial Development Loan Fund

BACKGROUND: PURPOSE:

The Entrepreneurial Development Loan Fund (EDLF) is a loan program of the Atlanta Business Community Development Corporation, which was formed in April, 1994 as a cooperative ofthe Atlanta ChamberofCommerce, The Atlanta Project, and six founding institutions, which have made available a total of $11.5 million. The financial institutions are Bank South, First Union, NationsBank, Trust Company, and Wachovia.
To facilitate economic development, particularly in targeted Atlanta Project cluster areas by making credit available to small businesses located within those areas, particularly businesses owned by minorities and women.

USE OF PROCEEDS:
TERM:
TYPES OF LOANS:

AMOUNT:

Typically, loans range from a low of $25,000 to a maximum of $100,000, However, smaller amounts and larger amounts may be considered.

FEES:

A $ I00 non-refundable loan application fee and an $8 credit report fee are required. These fees must be paid when the loan application is submitted. Additional loan closing fees and charges may be required after loans are approved.

RATES:

Interest rates are competitive with bank rates. They may float with the prevailing prime rate of they may be fixed for the term of the loan. Typically rates will range from 2% over prime to 3% over prime.

Loan proceeds may be used for working capital, inventory, supplies, furniture, machinery or equipment. Generally, the use of loan proceeds for any legitimate business purpose is permitted.
Typically, the loan term does not exceed five years, or one year for renewable lines of credit. However, the loan term may exceed five years if needed.
The EDLF makes term loans to purchase supplies and business equipment, and to fund working capital needs, including operating expenses. The EDLF also provides lines of credit to fund contract working capital needs (Le., payroll, materials, insurance, etc.), to finance purchase orders, to purchase inventory, or to finance accounts receivable.

24

ELIGIBILITY: To be eligible, the EDLF loan applicant must: A. Be organized as a for-profit enterprise.
B. Demonstrate management experience in your business, trade or profession.
C. Be located within the Atlanta metropolitan area.
D. Demonstrate at least a 10% equity position in the business. The equity requirement may exceed 10% based on the nature ofthe business, the financial condition, past or projected performance of the business, use of proceeds, or other related considerations. Generally, businesses with a negative net worth are not eligible.

TECHNICAL ASSISTANCE:
TO APPLY:

On-going business assessment and advisory services are available through the EDLF program designed to help strengthen the financial condition of the business and improve performance.
If you would like to apply for an EDLF loan, or if you would like more information about the program, please call 659-5955 and ask for an EDLF Loan Officer. The center operates between the hours of 8:30 a.m and 5:00 p.m., Monday - Friday.

Current as of: 11/96

APPLICATION REQUIREMENTS:
A variety of information is required at the time of loan application. If all information is not available at the time of loan application, you will have one month to complete your loan package. Application requirements include, but are not limited to the following: A. Satisfactory personal credit history. B. Adequate collateral. C. Personal tax returns for three years. D.Personal financial statement on owners. E. Monthly cash flow projections for 24 months. F. Satisfactory business plan. G. Business license. H. Business checking account. 1. Satisfactory bookkeeping system. J. Business tax returns, balance sheet and income
statement for three years or the start date of your business if less than three years. K. Resumes stating related business experience of owners.

25

Small Business Investment Companies

Small Business Investment Companies (SBIC's) exist to supply equity capital, long-tenn loans and management assistance to qualifying small businesses. The privately owned and operated SBIC's use their own capital and funds borrowed from the Small Business Administration (SBA) to provide financing to small businesses in the fonn of equity securities and long-tenn loans. SBIC's are for profit and select small businesses to be fmanced within the Rules and Regulations set by SBA. Section 301(d) SBIC's (also known as Specialized SBIC's) are a specialized type of SBIC that provide assistance solely to small businesses owned by socially or disadvantaged persons.
SBIC's invest in a broad range of industries. Some SBIC's seek out small businesses with known products or services because of the strong growth potential ofsuch finns. Some SBIC's specialize in the field in which their management has special competency. Most SBIC's,

however, consider a wide variety of investment opportunities.

Only finns defined by the SBA as "small" are eligible

for SBIC financing. The SBA defines a company as

small when its net worth is $18 million or less, and its

average net (after tax) income for the preceding two

years does not exceed $6 million. For businesses in

industries for which the above standards alternative size standards are available. In

daeretetnonoinloiwn~

whether a business qualifies, all of the business' parents,

subsidiaries, and affiliates are considered.

Listed below are active SBIC's and Specialized SBIC's in Georgia. Other SBIC's located in other states might also be able to serve the needs of small businesses in Georgia.

Preferred Level of Investments: Investment Policy: Investment Type:
Industry Preference: Geographic Preference:

Regular SBICs Cordova Capital Ralph Wright & Paul Dibella, Managers 3350 Cumberland Circle, Suite 970 Atlanta, Georgia 30339 (770) 951-1542
$1.0 - $3.0 million Equity
Early Stage, Expansion Later Stage
Diversified
Southeast

Specialized SBIes Renaissance Capital Corporation Anita Stephens, President 34 Peachtree Street, N.W., Ste. 2230 Atlanta, Georgia 30303 (404) 658-9061
$300,000 Loans and equity investments Early Stage, Expansion Diversified Southeast

For additional information contact: Don Christensen, Investment Division 409 Third Street, S.W. Washington, D.C. 20416 (202) 205-6510
Current as of: 11196

26

Surety Bond Guarantee Program

What is a Surety Bond?
A surety bond is a three party instrument between the surety, the contractor and the project owner, The agreement guarantees a contractor will comply with the contract and surety company assumes the risk of performance to the owner (obligee) in the event of contractor default. SBA's Surety Bond Guarantee Program enables small contractors to obtain the surety bonds necessary to compete for government and nongovernment contracts. SBA's guarantee permits a small business contractor to obtain a surety bond when the company might otherwise be unable to obtain a bond. This program makes the bonding process accessible to small and emerging contractors, thus enabling them to establish a bonded tract record.

For further information contact:
Edith Fuller SBA Surety Bond Division (404) 347-0210, ext. 20 Current as of: 11/96

Who needs a bond?
Almost all sizable construction projects and some service contracts require bonding. The Miller Act requires prime contractors on some federal projects to post a surety bond. Many states, counties, municipalities, private sector projects and subcontractors also require surety bonds.

Who is eligible to apply for a Surety Guarantee?
Any contractor meeting SBA's size standard requirement can apply for an SBA surety guarantee. In general, a firm is classified as "small" if the company's average annual receipts over the last three fiscal years do not exceed $5 million.

Are there any guidelines concerning the Surety Guarantee?
You need to consider the following before applying: The face value of an SBA Guarantee contract cannot
exceed the sum of $1.25 million. SBA will guarantee a surety 70-90 % of the face
value of a contract depending on the program and the social/disadvantaged status of the applicant.
What costs are involved? The premium charged by the surety. An SBA charge of $6 per every $1,000 of the contract
amount (final bonds only).

27

Minority Programs
=============================================== 28 ================================================

Minority Small Business Resource Organizations

These organizations provide a variety of technical counseling and financial assistance to minority small business.

Atlanta Business League 8818 Washington Street, S.W. Atlanta, Georgia 30315 (404) 584-8126

Atlanta Public Schools Contract Compliance Office 1631 LaFrance Street, N.B. Atlanta, Georgia 30307 (404) 371-7129

Business Development Center - NAACP 2034 Stewart Avenue, S.W. Atlanta, Georgia 30315 (404) 768-5755

Department of Commerce Minority Business Development Agency (MBDA) Summit Building, Room 1715 401 West Peachtree Street, N.W. Atlanta, Georgia 30308 (404) 730-3300

Small Business Administration Minority Small Business Division 1720 Peachtree Road, N.W., Suite 636 Atlanta, Georgia 30309 (404) 347-7416

29

Minority Business Development Agencies (MBDA)

The u.s. Department ofCommerce's Minority Business
Development Agency funds Business Development Centers nationwide: to assist start-up, expansion and acquisition of competitive minority-owned firms offering quality goods and services. Minority Business Development Centers (MBDCs), Native American Business Development Centers and Minority Enterprise Growth Assistance Centers - known as MBDCs, NABDCs and Regional MEGA Centers - provide business assistance for bonding, bidding, estimating, financing, procurement, international trade, franchising, acquisitions, mergers, and joint ventures to increase opportunities in domestic and international markets for minority entrepreneurs.

Atlanta: Augusta:

The MBDA-funded centers are operated by private firms, non-profit organizations, state and local government agencies, American Indian tribes and educational institutions. The centers provide accounting, administration, business planning, construction and marketing information. They also identify minority-'owned firms for contract and subcontract opportunities with federal, state, and local government agencies and the private sector. Operations of the centers are administered by MBDA's Regional and District Offices which oversee the centers' business assistance services to minority entrepreneurs in six multi-state regions.

Columbus:

Atlanta MBDC Harry Zacharias, Director 75 Piedmont Road N.E. Suite 256 Atlanta, Georgia 30303 (404) 586-0973 (404) 586-8131 FAX
Augusta MBDC Kelly McKie, Director 1394 Laney-Walker Boulevard Augusta, Georgia 30901 (706) 722-0994 (706) 722-1730 FAX
Columbus MBDC Post Office Box 1696 Columbus, Georgia 31902 (706) 324-4253 (706) 324-0335 FAX

30

Georgia Minority Subcontractors Tax Credit

In an effort to assist minority-owned businesses, the State of Georgia has a new law which provides for an income tax adjustment, on the State Tax Return, to any company which subcontracts with a minority-owned firm to furnish goods, property or services to the State of Georgia. This includes, but is not restricted to, the construction of any building or structure for the state. The law also defines minority-owned business for the purpose of this program.
A minority-owned business can be one ofthe following: 1. a business which is owned by a member ofa minority
race, or
2. a partnership of which a majority of interest is owned by one or more members of a minority race, or
3. a public corporation of which a majority of the common stock is owned by one or more members of a minority race.
Legislation passed in 1984 (Georgia Code Annotated Title 48, Chapter 7, Article 38) provides for an income tax adjustment, beginning with Tax Year 1985. The law allows a corporation, partnership, or individual, in computing Georgia taxable income, to subtract from federal taxable income or federal adjusted gross income, 10 percent of the amount of qualified payments to minority subcontractors. A payment to a minority subcontractor is a qualified payment if: 1. the payment is for goods, property or services
furnished by the minority subcontractor to the taxpayer and delivered by the taxpayer to the State in furtherance of a State contract to which the taxpayer is a party, and the payment does not exceed the value of the goods, property or services to the taxpayer;
2. the payment is made during the taxable year for which the subtraction from federal taxable income or federal adjusted gross income is claimed;
3. the payment is made to a subcontractor who at the same time of the payment is certified as a minority subcontractor by the Department ofAdministrative Services. The total amount which may be subtracted from federal taxable income or federal adjusted gross income of any taxpayer in computing Georgia taxable income shall be limited to $100,000 per taxable year.

To be a certified minority subcontractor, a company must meet the definition of a minority-owned business and in addition, meet the following criteria: 1. be organized in the State of Georgia; or 2. report income from your business for Georgia
income tax purposes; or 3. ifminority stockholders, report earnings for Georgia
income tax purposes. We make an appeal requesting businesses in your community to return the application for certification to the Department of Administrative Services. Should these businesses have questions or need new applications, please contact:
Small and Minority Business Program 200 Piedmont Avenue Suite 1304, West Floyd Building Atlanta, Georgia 30334 (404) 656-6315 (800) 495-0053
Current as of: 11/96

31

Other Programs ofInterest to Small Businesses
========================================= 32 ===::::;:==============================

Atlanta Economic Development Corporation (AEDC)

The Atlanta Economic Development Corporation (AEDC) is a private non-profit corporation founded in 1976 to promote and implement economic development within the city.

encourage the efficient use of energy resources for commercial, industrial, or mixed-use facilities; acquisition of commercial, industrial and mixed-use properties; and inventory and office equipment.

AEDC represents a partnership ofthe public and private sectors for the purpose of creating and/or retaining jobs, encouraging capital investment, promoting business and neighborhood development and expanding the tax base of the city of Atlanta.
SMALL BUSINESS DEVELOPMENT AEDC provides financial and technical assistance to small minority and female owned businesses to expand and/or relocate in the city.
In cooperation with local financial institutions and government agencies, provides a variety of financial aids for business development projects that have corresponding public benefits.
As a process broker and intermediary, AEDC prepares financial packages designed to bridge the gap between initiation of and financial support from foundations, corporations, banks, government entities and other funding sources to make projects come to fruition.

BUSINESS IMPROVEMENT LOAN FUND (BILF)

TargdAreas
Auburn Avenue Bankhead Highway Campbellton Road Cascade Road East Atlanta Georgia Avenue Heart Of Atlanta
(including Underground Atlanta)

Kirkwood Memorial Drive MLKlAshby Pryor Road StewartlLakewood SylvanIDill West EndlWest View

AEDC manages the City of Atlanta's Business Improvement Loan Fund (BILF) Program, which is designed to encourage the revitalization of targeted business districts in Atlanta, and to support commercial! industrial development in other eligible areas.
Loans can be made for: additions and/or improvements to commercial, industrial and mixed-use property; purchase of equipment and fixtures, which are part of the real estate; emergency conservation designated to

The forms of financial assistance available through the BILFare: DIRECT LOANS up to $50,000 are available to
businesses that are not able to obtain a market rate loan. The interest rate is determined by the project's cash flow, and the loan must be repaid on a monthly basis over a term not to exceed 7 years.
LOAN PARTICIPATION is provided for larger loans (usually $50,000 or more) in the Community Development Impact Areas (CDIA) Loans may be made to small business concerns to assist in meeting local injection requirements for SBA loans with no more than 10% of the total project financial provided from the BILE The interest rate is determined by the project's cash flow, and the repayment term may not exceed that of the longest participating lender (maximum 25 years).
THE PHOENIX FUND Financing/Advantage and Opportunities Include: Below Prime Interest Rate Loan Term Range from
3 to 7 years
Loan Amounts from $10,000-$100,000
Low Equity Injection
Fixed Asset and Working Capital
A Team of Dedicated Professionals
WHAT IS THE PHOENIX FUND?
The Phoenix Fund is a program created to assist small and medium-sized businesses. The fund provides financial assistance for: construction or renovation of privately-owned
commercial buildings;
equipment purchases needed to operate a business;
and, in some cases, working capital.
The Atlanta Economic Development Corporation through its Phoenix Fund provides loans from $10,000$100,000 at a rate below prime. By assisting small businesses with affordable loans, the Fund works toward its goal of creating and retaining jobs for low! moderate income residents in the City of Atlanta.

33

This program is funded by the Economic Development Administration (EDA) of the U.S. Department of Commerce and the City of Atlanta.

Typical Structure: Source

Amount

Private Financing

67%

Phoenix Fund

33%

Total

100%

May include all or a combination of: capital invested by the borrower or other Financing from private entities SBA affiliated loan programs

For more information on the Phoenix Loan Fund and other financing programs, please contact: Marc Younger AEDC 230 Peachtree Street, Suite 100 Atlanta, Georgia 30303 (404) 658-7734 Fax: (404) 668-7734
Current as of: 11196'

Terms of the Phoenix Fund:

Loan Amount:

$ I0,000-$ I00,000

Term of Loan:

Maturity dates range from 3 to 7 years

Interest:

The interest rate of the loan is one-half (1/2) of the current prime interest rate, plus two (2) percent (1/2 prime +2), with a minimum rate of 4%.

34

United States ExportAssistance Center (USEAC)

u.s. Export Assistance Centers (USEAC) serve as onestop-shops for export assistance, combining all federal export resources under one roof. In September, 1995 the Export Assistance Center in Atlanta opened its doors to provide customer focused services to exporters. The Atlanta EAC is unique in that it integrates an extensive state export assistance network with federal resources.
The mission of the Export Assistance Center is to:

For more information contact: Susanne Keough 285 Peachtree Center Avenue Suite 200 Atlanta, Georgia 30303 (404) 657-1964 (404) 6571970 Fax
Current as of: 11/96

increase the number of successful u.S. exporters and their expansion into existing and new markets
create jobs through exports
increase the international competitiveness of U.S. industry by providing a single point of contact for export marketing and trade finance assistance
The Atlanta EAC provides marketing assistance, a resource center and financial assistance. The professional counseling services provided by EAC counselors is free of charge. Most market research and trade information is furnished at no cost to the client. Formal applications for trade finance programs involve fees.

The Atlanta EAC combines the export promotion and finance resources of the following agencies:

U.S. Department of Commerce U.S. Small Business Administration The Georgia Department of Agriculture The Georgia Department ofIndustry, Trade and Tourism Georgia Tech Center for International Standards
and Quality Department of Community Affairs Service Corps of Retired Executives Small Business Development Center

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Georgia Procurement Assistance Center (GPAC)

In an effort to broaden the base offmns supplying goods and services to the federal government, the Defense Logistics Agency contracts with procurement assistance centers around the country to assist firms in their efforts to do business with the federal government. The Georgia Procurement Assistance Center (GPAC) is one such center. GPAC since its inception in September, 1985, has been providing assistance to Georgia firms interested in finding opportunities within the federal market.

For further information contact: Charles Catlett Georgia Tech Economic Development Institute 208 O'Keefe Building Atlanta, Georgia 30332 (404) 894-6121
Current as of: 11/96

The major purpose of GPAC is to promote economic and business development in Georgia and provide assistance and direction to firms in the procurement market. The Center helps firms solicit bids and locate procurement opportunities with the Department of Defense and area military facilities seeking certain goods and services. Although assistance is given upon request to any firm, the majority of clients are small and disadvantaged businesses. The Center will offer assistance as long as the firm shows interest and effort.

A free overview ofgovernment procurement is provided to interested companies and assistance is given for placement on the mailing lists of government buying centers. The Center staff evaluates the firm's ability to supply items.They use this information to match firms and government procurement opportunities. In addition, contractors are interested in areas such as packaging, quality control, and cost accounting. If necessary, the Center will assist the contractor through the entire bidding process. Government buyers are beginning to rely on the Center to locate new qualified sources as well as assisting current prime contractors with problem areas. The Center also offers a computer matching service that matches opportunities listed in the Commerce Business Daily (CBD) with client capabilities. Although all other services are free ofcharge, a yearly fee of $150 is charged to companies who want to participate in the computer matching service.

The Georgia Tech Research Institute (GTRI) has 12 regional offices around the state. GPAC has a counselor in each of these offices. These counselors also help to ensure that GPAC's services are available statewide.

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GEORGIA DEPARTMENT OF
COMMUNITY AFFAIRS
60 Executive Park South, N.E. Atlanta, Georgia 30329-2231
(404) 679-4940 Publication Number: 0277
*Printed on Recycled Paper