Sherbrooke — Local investment and solidarity funds (FLI and FLS)
Sherbrooke, QC, Canada
Financial aid for Sherbrooke business development and job creation
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|maxCount
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|timelineUnspecified
grant_single|financingType
Loans and Capital investments
grant_single|eligibleIndustries
- Agriculture, forestry, fishing and hunting
- Mining, quarrying, and oil and gas extraction
- Manufacturing
- Wholesale trade
- Retail trade
- Information and cultural industries
- Professional, scientific and technical services
- Arts, entertainment and recreation
- Accommodation and food services
grant_single|grantors
- Ville de Sherbrooke
grant_single|status
grant_card_status|open
grant_single_labels|terms_and_conditions
- Investments are made through term loans which can include or exclude movable or immovable guarantees, and may or may not require a personal guarantee.
- Loans can be participatory, including either a royalty on net profit or increased sales, or an option to purchase participating shares.
- Loan schedules can be tailored to fit the realities of the business, such as those with seasonal operations.
- The principal may be repaid according to the cash flow generated, particularly in entrepreneurial succession and business expansion cases.
- Interest is payable monthly, with a typical maximum repayment term of 7 years, extendable to 10 years for certain projects based on cash flow generation.
- The total financing duration, including moratoriums, cannot exceed June 1, 2032, for FLI (Local Investment Fund) related investments.
- No investments are made through repayable or non-repayable contributions attributable to a grant.
- Temporary loans by FLS can be provided for short-term durations ranging from weeks to months for bridging finance, subject to verified future income sources with real evidence of receivables.
- FLS cannot invest in capital stock, while FLI can invest through acquisitions of bonds, other debt securities, or equity participations.
- Maximum investment from FLS in a single entity is capped at $100,000.
- Maximum FLI investment in a project must not exceed 50% of eligible expenditures, raised to 80% for social economy enterprises.
- Maximum cumulative repayable financial aid balance from FLI in twelve months is $150,000, with a lifetime balance cap of $300,000.
- Interest rates are established based on risk levels, with adjustments possible based on the type of guarantee provided and investment term.
- Entrepreneurial succession projects can benefit from interest-free loans through FLI, limited to 50% of the FLI portfolio contribution.
- Equity requirements include at least a 20% equity position post-project for start-ups and existing businesses, with flexibility based on project and promoter quality.
- Repayment moratoriums on capital are available up to 12 months, extendable to 24 months for FLS projects in specific conditions, and interest must be paid monthly unless conditions specify otherwise.
- Documentation fees apply at 1.5% of the loan balance, not exceeding $2,000, payable at disbursement.
grant_single_labels|projects
- Entrepreneurial succession planning involving a significant ownership transfer.
- Acquisition of existing businesses or assets.
- Business development initiatives focusing on productivity improvement.
- Digital transformation projects within companies.
- Expansion of business operations and market reach.
- Short-term bridge financing waiting for confirmed sources of income.
- Restructuring initiatives for businesses facing temporary challenges.
grant_single|admissibleProjectsExample
$ 60,000
Launching an environmental education program for schools
grant_single_labels|admissibility
- 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.
grant_eligibility_criteria|who_can_apply
- 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.
grant_eligibility_criteria|who_cannot_apply
- 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.
grant_eligibility_criteria|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.
grant_eligibility_criteria|zone
- Territory of the City of Sherbrooke
grant_single_labels|criteria
- 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.
grant_single_labels|register
- Step 1: Complete Application Form
- Obtain the application form pertinent to the FLI/FLS funding.
- Fill out all sections of the form, ensuring that the information is accurate and up-to-date.
- Date and sign the completed form.
- Step 2: Prepare Supporting Documentation
- Compose a detailed business plan or project description as required.
- Prepare a breakdown of the project's expenses.
- Compile the financial structure of the project, including confirmed financial aid or other financing.
- Gather the financial statements from the past three years.
- Include interim financial statements if applicable.
- Prepare forecasted financial statements.
- Gather declarations of compliance, such as francization or equality in employment certificates, if applicable.
- Gather any additional documents requested by the City of Sherbrooke.
- Step 3: Submit Application
- Submit the completed application form and all supporting documents to the City of Sherbrooke for review.
- Ensure that the submission meets all requirements outlined by the investment policy.
- Step 4: Await Review and Decision
- Wait for the City of Sherbrooke to review the submitted application and materials.
- The application will be evaluated based on eligibility, analysis, and decision criteria.
grant_single_labels|otherInfo
- 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.
