Sherbrooke — Local investment and solidarity funds (FLI and FLS)

• The applicant must be a for-profit business legally constituted under the laws of Quebec or Canada, or a collective business (cooperatives and non-profit organizations) with commercial activities as per the Social Economy Act.
• The business must operate within the territory of the City of Sherbrooke and have its headquarters in Quebec.
• The business must be registered with the Quebec Enterprise Register (REQ).
• The business must align with one of the eligible economic sectors: Primary, Manufacturing, Key Tertiary and Technological, Traditional Tertiary, or Tourism.
• The business cannot be registered in the Register of companies ineligible for public contracts (RENA) or be a state-controlled company.
• The business must not be under the protection of the Companies’ Creditors Arrangement Act or the Bankruptcy and Insolvency Act.
• The business must show an ethical conduct that upholds the integrity of the government or municipality and must not have a history of non-compliance with labour standards or human rights legislation.
• The business should not be involved in specific sectors including armament production, fossil fuel extraction, gambling, violent games, sexual exploitation, real estate management and development, or certain prohibited activities related to cannabis.
• Financial aid should not be used to make payments to entities in any of the aforementioned excluded situations.
• The business or project should aim for a significant contribution to socio-economic and environmental improvements in the territory.

Who is eligible?

• Primary sector companies in agriculture, fishing, forestry, and mining.
• Manufacturing and wholesale trade sectors.
• "Engine" and technological tertiary sector companies using innovative technologies.
• Traditional tertiary sector businesses, particularly those in revitalization areas or providing unique community services.
• Tourism-related companies offering leisure or business tourism activities, such as agrotourism and cultural tourism.

Who is not eligible

• Companies registered on the Register of enterprises ineligible for public contracts (RENA), including their subcontractors.
• Entities that have failed to meet obligations from previous financial aid within the last two years and have been formally notified.
• State-owned companies or enterprises controlled directly or indirectly by any level of government.
• Companies under the protection of the Companies' Creditors Arrangement Act or the Bankruptcy and Insolvency Act.
• Enterprises with ethical conduct concerns damaging to the image of government or regional county municipality.
• Businesses with poor environmental responsibility histories.
• Companies with a record of not complying with labor standards or human rights legislation.
• Organizations involved in the production or distribution of weaponry.
• Companies engaged in fossil fuel exploration, extraction, or refining, except those transitioning to a low-carbon economy.
• Establishments operating games of chance, such as casinos or bingo halls.
• Businesses involved in violent games, combat sports, racing, or similar activities.
• Enterprises linked with sexual exploitation like erotic bars or the production of pornographic material.
• Real estate management and development companies.
• Companies related to tobacco or drug consumption services.
• Businesses producing recreational cannabis products or certain cannabis-related goods.
• Professional service providers such as legal services, accounting, and consulting, listed in Annex C.

Eligible expenses

• Additional working capital needed for the project of the company, compared to existing operating expenses, for a maximum period of two years, which corresponds to the year of project completion and the following year, determined on the basis of justified and reasonable expenses.
• Capital expenses strictly and directly related to the realization of the company's project, such as the acquisition of technology, land, buildings, equipment, machinery, and rolling stock, as well as construction, expansion, renovation, and development of land and premises.
• Professional fees incurred prior to the company's project realization, such as feasibility analysis, external audit, or impact study.
• Professional fees strictly and directly related to the realization of the company's project, such as the implementation of technology, equipment, and machinery, as well as the acquisition, construction, renovation, and development of land and premises.
• For entrepreneurial succession projects, expenses related to the acquisition of property titles of the targeted company (voting shares or units) and the company's assets.
• Professional fees strictly and directly related to the transaction and acquisition of the business as well as the transfer of the company's management.

Eligible geographic areas

• Territory of the City of Sherbrooke

• Economic viability of the funded company, including profitability, repayment capability, and positive outlook.
• Knowledge and experience of the promoters, demonstrating relevant industry expertise and management skills.
• Environmental and societal impacts, with an emphasis on sustainable business practices.
• Openness towards employees, considering their approach to workplace relations.
• Participation of other financial partners, including minimum involvement from financial institutions and promoters' own capital contributions.
• Self-financing capability guiding the selection of enterprises to sustain fund continuity.

• The investment policy respects a partnership convention with Fonds locaux de solidarité FTQ, allowing for joint investments between the FLI and FLS but permitting exceptions where either can invest alone.
• There is a prescribed mechanism for handling repayment defaults, including legal measures, and recovery costs are shared between FLI and FLS.
• The interest rate is determined based on a risk analysis and may include reductions for eco-responsible projects.
• The City of Sherbrooke may amend the investment policy, provided it remains within the regulatory framework set by MEIE for FLI and Fonds locaux de solidarité FTQ for FLS.
• Applications require a comprehensive submission including financial statements and a business plan, demonstrating sound business viability and potential impact.