A Guide to the by theelixer


									A Guide to the
AERLP Participation Agreement
Since 1996, the Iowa Energy Center’s Alternate Energy Revolving Loan Program (AERLP) played a supporting
role in stimulating renewable energy development within the state of Iowa.

Our partnering lending institutions are responsible for financially qualifying the borrower, while the Energy Center
assists in technically qualifying the borrower. By teaming with experts from lending institutions the Energy
Center is able to cost-effectively process the loans in a timely manner and maximize the impact of the loan
program. To follow is review of the Lenders Participation Agreement.

                                                                                               (front page)

Single Promissory Note
Energy Center is not a lender or debt servicing entity. A single note keeps
Energy Center funds and lender funds on essentially an equal disbursement and
repayment basis, provides a traceable tie to the lender share of the financing,
prevents the borrower from paying off an interest-bearing debt before paying off
zero percent debt, and motivates the lender to service Energy Center funds with
same degree of care as it would its own.

Two general models used:
   • Single loan note with blended interest rate
   • ‘Series A’ note (P & I) coupled with ‘Series B’ note (P only) tied to a
      master loan agreement.

Item 5
Reviews the general requirements for the lender to repay the funds advanced by
the Energy Center including handling of prepayments and/or deficient payments
received from the borrower.
                                                                                         (front page)

Item 7
AERLP funds are for a new Alternate Energy Production Facility. The AERLP
funds cannot be used to refinance debt that existed prior to the borrower re-
questing AERLP funds.

Item 10
Defines the terms under which a loan is considered to be in default and the
general course of action to mitigate a default. Lender rights and responsibilities
for collection of outstanding debt are described.
                                                                                         (back page)

 Item 11
 Discusses rights, limitations and responsibilities of the lender and the Energy
 Center with respect to collateral for the loan.

The AERLP is administered by the Iowa Energy Center. The Energy Center is a research, demonstration and edu-
cation organization dedicated to improving Iowa’s energy efficiency and use of renewable energy.

                                   Iowa Energy Center
                                   2521 University Blvd., Suite 124
                                   Ames, IA 50010
                                   (515) 294-8819

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