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Ineligible Project <br />Costs <br />Building Construction <br />Construction includes the erection of a new building and/or a <br />major addition to an existing building. <br />Purchase Machinery and Equipment <br />Oakdale Seed Fund proceeds can be used to finance the purchase <br />of major items of machinery and equipment independent of land <br />and building. These items are defined to have a useful life of at <br />least 7 years. The term of the loan will be commensurate with the <br />life of the asset. <br />The following costs should not be construed as part of the project <br />costs under this program. <br />a) Management fees <br />b) Financing costs and fees <br />c) Franchise fees <br />d) Debt consolidation <br />e) Moving costs <br />Leasehold <br />Improvements Financing should be permitted for leasehold improvements <br />including construction on leased land. The lease should be equal to <br />or greater than the term of the loan. The remaining economic life <br />of the facility or leasehold improvements should be equal to or <br />greater than the term of the Seed Fund loan. Financing may be <br />provided if the land or building owner allows the EDA to secure <br />lien positions on the land or building and improvements, sufficient <br />to fully secure its exposure or if other collateral sufficient in value <br />to fully protect the interest of the Oakdale EDA is offered. <br />Limited or Single <br />Purpose Assets <br />The construction or the purchase of limited use assets should not <br />be financed under the Oakdale Seed Fund unless the liquidating <br />value of the asset plus other available collateral, if sold, would be <br />54 <br />