Harvester Enterprise Loan Program Open For Application
July 18, 2024
The Harvester Enterprise Loan Program (HELP) is now open for application. Application materials are linked below:
Application materials and a summary of the scope of the Program can be found on the webpage for the Department of Industry, Energy, and Technology (IET) linked HERE.
FFAW received an information session from provincial government yesterday on HELP, and it was confirmed that all chartered banks and credit unions will receive similar information sessions on the Program by the end of this week if they have not already. While your bank if your primary point of contact, your inshore member representative will offer any assistance they can but please note that FFAW does not have access to administration of the Program.
APPLICATION PROCESS
- Applications must be made to financial institution by the borrower via HELP Application and supporting documentation
- Financial institutions advise IET of request for loan guarantee under the program
- After receiving supporting documentation from the financial institution, IET, in consultation with the Department of Fisheries, Forestry, and Agriculture (FFA) prepares assessment for Innovation and Business Investment Corporation (IBIC) decision (*IBIC is funding the $15-million enhancement to the Program)
- Department of Finance issues Loan Guarantee
- Upon approval, IET issues Loan Guarantee Offer to the financial institution and Financing Agreement(s) to Harvester.
PROGRAM CRITERIA:
- Enterprise viability or potential viability
- Ability to repay the loan
- The loan/grant is necessary to benefit of the business
- A favourable credit history
SECURITY REQUIREMENTS:
• Borrowers required to provide adequate security.
• May include a promissory note, personal/corporate guarantee, mortgages or security
agreements that capture vessel, equipment and fishing licenses.
ELIGIBLE APPLICANTS:
• Company is an NL entity
• Shareholder(s) of the company is resident(s) of NL
• Proprietor is a Canadian citizen and resident of NL
• Core harvester certified by the Professional Fish Harvesters Certification Board
• Holds or eligible to hold commercial fishing license
DOWN PAYMENT REQUIREMENTS
• Minimum cash down payment of 0% from applicant. No maximum.
• Optional patient down payment loan from IET:
– 10% for vessel acquisition / refit
– 15% for Purchase of License or enterprise
REPAYMENT TERMS
• Negotiated between the borrower and the lender, based on the following:
– 20 year term Vessels, depending on life expectancy, for construction, purchase and upgrades. Combined purchase of vessel, equipment and licenses.
– 15 year term license acquisition only.
– 12 year term used vessels, vessel upgrades (dependent on life expectancy)
– Refinancing at with same terms as above (No DP required if >15% equity)
– Flexible loan repayment options (annual principal payments, assignment of catch and/or a percentage of gross revenue)
AMOUNT OF LOAN GUARANTEE
• The province’s guarantee can provide up to 100 per cent of an outstanding loan
• Up to $3 million for vessel only related items;
• Up to $4 million for combining of enterprises; and
• Up to $2 million for license acquisition only.
MAXIMUM INTEREST RATES
• As negotiated between the borrower and the lender, to a maximum of commercial prime plus 2 per cent or 2.5 per cent, depending on the term of the loan.
• Floating interest rates can be converted to fixed rates.