ET 2000

NEW BUSINESS DEVELOPMENT PROGRAM

The Small Business Assistance Program of the Oak Ridge Chamber of Commerce and the East Tennessee Economic Council

I. INTRODUCTION

The Oak Ridge Chamber of Commerce (ORCC) and the East Tennessee Economic Council (ETEC) have established the ET 2000 New Business Development Program, a coordinated small business assistance program of below market early stage real estate space; an extensive network of professional, technical and academic business development experts providing a curriculum of business training and support; and a series of public/private financial assistance programs (headlined by a $1.7 million United States Department of Energy funded Revolving Loan Fund) designed to increase technology-based small business access to necessary start-up and expansion capital.

ET 2000 is a comprehensive program of small business development "tools" ultimately designed to achieve a self-perpetuating pro business development environment that consistently generates and expands healthy small business within the City of Oak Ridge and the East Tennessee Technology Corridor as a whole.

II. MANAGEMENT

The ET 2000 New Business Development Program is coordinated by staff of the Oak Ridge Chamber of Commerce. Daily operations of the ET 2000 program are managed by the Oak Ridge Chamber of Commerce Director of Small Business Services.

III. REAL ESTATE COMPONENT--ET 2000 Small Business Incubator Program

By the middle of 1995, the ET 2000 Program will manage approximately 38,000 square feet of small business incubator space in three (3) facilities located in two (2) Oak Ridge industrial parks. 12,000 square feet of existing incubator space has been incorporated into the program. 20,000+/- square feet of new small business incubator space is under construction through a partnership of the U.S. Economic Development Administration (EDA), the City of Oak Ridge and the Oak Ridge Chamber of Commerce. Occupancy is projected for September 1995. Approximately 4,500 square feet of the Technology 2020 telecommunications business and conference center facility will be designated as "high end" small business incubator space for ventures requiring access to sate-of-the-art telecommunications technology.

In addition to the business resources outlined below, incubator tenants benefit from several other services including:

(Voice mail and facsimile services
Integrated System Digital Network (ISDN) or Fiber Optic Telephone System
(Shared access to office equipment; and
(Common use training and conference facilities,
(Technology 2020) incubator tenants have access to the facility's T-1 communications lines, teleconferencing equipment and other state-of-the-art telecommunications technology. Tenancy in an ET 2000 Small Business Incubator is an opportunity for small business ventures which are engaged in developing or producing a product to enjoy access to a unique array of high quality business assistance resources in an expressly pro-small-business environment. Demand for ET 2000 Small Business Incubator Space requires that priority be given to those businesses with innovative technology and/or potential for expansion and employment growth.

RATES AND TERMS
1) Lease Rates: Lease rates in the ET 2000 Small Business Incubator Program incubator facilities will always be below market rates for comparable space. Lease rates in all three incubator facilities are graduated so that final year rates will be approaching market rates for comparable space in the private sector.
2) Lease Terms: Tenants are offered up to three (3) year lease terms in the ET 2000 incubator facilities. ET 2000 is envisioned as a "training" opportunity for developing small business. It is not intended as a permanent solution to the real estate needs of the area small business community. The ET 2000 Small Business Incubator Program is NOT intended to compete with private sector commercial and industrial real estate providers.
Tenant companies occasionally require expanded space in excess of the capabilities of the ET 2000 facilities. ET 2000 staff assists these companies in locating appropriate space within the Oak Ridge service area. Assuming these companies provide sufficient notice to ET 2000 to allow marketing of the space, there are no penalties for early cancellation of lease terms. The goal of the ET 2000 program is to successfully "graduate" tenant companies into viable private sector firms.

IV. BUSINESS RESOURCES COMPONENT-- ET 2000 Business Resources Network
The ET 2000 Business Resources Network is a unique network of professional, academic and technical experts providing business assistance to incubator tenants and financial assistance program recipients at pro bono and below market rate terms. The program includes:
- (Continuous program development and oversight by an Advisory Council made up of community, business and academic leaders;
- (One-on-one and group consultation with expert professional services providers such as attorneys, accountants, marketing/advertising consultants and architects/engineers/space partners, etc.;
- (Access to academic and non-academic technical experts in a variety of specialty areas;
- (Available broadbased and/or industry specific employee training and retraining assistance from our recognized network of experts;
- (Regular Oak Ridge Chamber of Commerce sponsored group training programs covering a wide variety of valuable business topics;
- (A Resource Center to provide ET 2000 Small Business Incubator tenants and ET 2000 Financial Assistance Fund recipients with access to business assistance materials ranging form video taped training sessions to business planning software to a myriad of printed brochures, forms, periodicals and business assistance publications;
- (Beginning in the middle of 1995, a full time Tennessee Small Business Development Center Advisor co-located with the Resource Center to provide hands-on business development assistance; and
- (Expert assistance in participating at the level of their choice in the acclaimed Tennessee Quality Awards (TQA) continuous workplace quality improvement program. In addition to the ET 2000 Business Resource Network, incubator tenants and financial assistance recipients have access to the traditional business assistance available through the U.S. Small Business Administration (SBA) and the Service Core of Retired Executives (SCORE).
  
  V. FINANCIAL ASSISTANCE COMPONENT--ET 2000 Financial Assistance Fund
  The ET 2000 Financial Assistance Fund is designed to fill "gaps" in the existing marketplace which are not adequately addressed by private lenders and public sector programs. Generally, the Oak Ridge Chamber of Commerce intends to utilize limited public funds which have been pledged by the U.S. Department of Energy to leverage significant private investment in the ORCC service area.
  The U.S. Department of Energy has pledged $1.7 million to establish and administer a revolving loan fund to stimulate investment in technology-oriented small and medium sized business enterprises. The ET 2000 Financial Assistance Fund targets small and medium sized businesses which are engaged in activities such as manufacturing a product or providing technology-based services which create new jobs and represent new economic activity in the area.
  
  RATES AND TERMS
  Specific rates and terms for ET 2000 Financial Assistance Fund participation are determined by the Loan Committee on a case-by-case basis according to the requirements of each transaction.
  The ET 2000 Financial Assistance Fund is intended to provide "gap" financing to the business community of the Oak Ridge Service Area. It is NOT intended to compete with existing capital sources, but to assist only those "qualified" businesses which cannot otherwise obtain suitable financing. Business seeking assistance from the Fund must document a legitimate need which cannot be met by the existing market.
  The Loan Committee will only consider investing in companies which demonstrate business acumen, technical expertise and knowledge of their target market through completion of a sound, realistic business plan and market analysis. The Loan Committee prefers participation which does not extend longer than five (5) years. Consideration may be given, on a case-by-case basis, to extending loan amortization and utilizing "balloon" or "bullet" repayment schedules in instances where a clear need is demonstrated.