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Broadband Authority Program and Project Update

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Tool for the above loans made to broadband providers ... ACD.net WEST. Project ... Softswitch and broadband gateways $5 million loan to build out IP network ... – PowerPoint PPT presentation

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Title: Broadband Authority Program and Project Update


1
Broadband Authority Program and Project Update
  • March 17, 2005

2
Mission and Lending Criteria
Missionattract investment to underserved
communities and encourage competition and more
affordable broadband services across the state in
all markets Tool for the aboveloans made to
broadband providers and grants combined with
loans in limited areas (using bond sale proceeds
and NO general fund dollars for this
purpose) Lending Criteriaadequate cash flow,
solid business plan, sufficient borrower equity,
guarantees and other security requirements as
necessary
3
Typical Loan Terms Conditions
TermsSenior lender with term loans ranging from
5 to 7 years and 12 to 24 month interest-only
draw periods if necessary Interest Rate8
percent fixed (also have limited availability of
a variable rate currently pegged at less than 5
percent) Equity100 percent project financing
available but net equity on company balance sheet
should equal 20 percent (at a minimum) of loan
request. GuaranteesTypically required but
usually NOT collateralized. Operating deficit
reserves and other alternatives to personal
guarantees utilized on occasion
4
MBDA is achieving its vision and making an impact
17.7 M Approved Projects
10M in Applications
10M Near-Term Applications
6-10M in likely loan applications Fiber and
wireless projects in underserved areas 2nd RFP
for Digital Divide Investment Program
Area Servedin dark
ISP Wireless PCS Broadband M-33 Access Appia
Communications ACD.net ACD.net WEST SpeedNet Michi
gan Lightwave Merit Networks UPLink Services Inc.
(seed) LDMI Lighthouse Broadband
UPLink Services, Inc. OneWorld AriaLink Endless
Journey
Additional DDIP Applications VoEx Lucre.Net Emmet
Wireless Grid 4 T2 Communications NBD
Communications First Step Michwave QIC
Borrower
5
ISP Wireless
  • Project
  • 341,836 loan for the expansion of fixed wireless
    broadband service in seven low-to-moderate income
    communities
  • Purchase of tower antenna and customer premise
    equipment
  • Status
  • ISP Wireless is expanding customer base
  • Internet Service Provider (ISP) business since
    1995
  • Stable business and revenues

6
PCS Broadband
  • Project
  • 510,000 loan for the expansion of fixed wireless
    broadband service in areas where small-to-medium
    enterprises (SMEs) are underserved
  • Purchase of tower antenna, routers and customer
    premise equipment
  • Status
  • Premise cabling company since 1992 and enterprise
    phone systems sales since 2000

7
M-33 Access
  • Project
  • Expanding contract service to community college
    and school districts
  • Refinancing of existing debt and purchase of
    equipment (towers, antennae, customer premise
    equipment)
  • 1.3 million loan
  • Status
  • Largest wireless broadband network grid of its
    kind in the US
  • New contract saving schools nearly 1 million and
    provide higher speed services

Note Illustrative only wireless coverage does
not blanket entire counties
8
ACD.net
  • Project
  • Facilities-based carrier expands DSL service to
    new markets and within existing areas
  • Re-financing of existing debt
  • New financing for expansion into new markets, new
    fiber routes and new equipment
  • 1.2 million loan
  • Status
  • Expansions in mid-Michigan complete
  • SBC mirroring activity

9
ACD.net WEST
  • Project
  • Acquisition of Quantum Connections assets and
    expansion of broadband service
  • 1,681,139 loan
  • Project will provide broadband service for
    business and residential customers
  • Status
  • Nearing completion of acquisition and transition

10
Appia Communications
  • Project
  • 758,000 loan to Traverse City-based INSORS, Inc.
    (dba Appia Communications)
  • Expansion and upgrades of network operations
    centers to expand service and provide redundancy
  • Enhanced converged voice and data network
    services for small and medium-sized enterprises
  • Status
  • Currently offers service in Kalamazoo, Detroit,
    Traverse City, Chicago and Indianapolis
  • Loan expanding footprint into Lansing and Grand
    Rapids

11
SpeedNet
  • Project
  • 1.5 million to finance the purchase of
    non-line-of-sight tower equipment and customer
    premise equipment and expansion in Tri-City area
    (Saginaw, Midland, Bay City)
  • Status
  • SpeedNet LLC, with headquarters in Saginaw
  • Uses licensed 2.1 GHz, 2.5 GHz and 2.6 GHz MMDS
    spectrum to provide fixed wireless broadband
    service
  • Currently serves the Alpena, Saginaw and Mount
    Pleasant areas

12
Michigan Lightwave
  • Project
  • Dark fiber network in Macomb County
  • Michigan Lightwave partnered with Macomb ISD and
    county government on network
  • 826,327 loan for completion and purchase of dark
    fiber network
  • New network will provide high-capacity, low-cost
    circuits for large enterprises
  • Status
  • Michigan Lightwave, LLC
  • Operates successful dark fiber network in
    Kalamazoo County

Project serves 25 new communities in Macomb
County and extends into St. Clair and Oakland
Counties
13
Merit Networks
  • Project
  • 4.1 million loan approved
  • Acquisition of fiber IRUs and construction of
    laterals to improve their backbone network
  • Borrower
  • Provider of high-speed data services to numerous
    universities and other public institutions
    throughout the State of Michigan
  • Currently determining whether tax exempt
    financing possible

14
LDMI
  • Project
  • Softswitch and broadband gateways
  • 5 million loan to build out IP network
  • Integrated voice and data services to
    Southeastern Lower Michigan
  • Expand facilities-based infrastructure
  • Borrower
  • Southfield-based Competitive Local Exchange
    Carrier (CLEC)
  • 300 Plus Michigan employees

15
UP Link
  • Project
  • 815,000 loan requested
  • Purchase of tower antennae, customer premise
    equipment and construction of wireless tower
  • 50,000 Seed Loan recipient
  • Underserved Upper Peninsula market
  • MBDA Board consideration in March
  • Borrower
  • UpLink Services, Inc.
  • Purchased earlier this year by several Marquette
    investors with strong technology and finance
    background

16
Lighthouse Broadband
  • Project
  • 500,000 loan for capital build-out costs to
    deploy Broadband Over Powerline (BPL) Initiative
  • CMS Partnership
  • Approved in February
  • Borrower
  • Shpigler Group (dba Lighthouse Broadband)
  • Management consulting firm for communications and
    technology
  • Operating two other BPL pilots across the country
  • Selected by Consumers Energy to pilot BPL
    initiative in Grand Ledge and likely St. Johns.

17
MBDA current portfolio of approved projects
Total number of counties at least partially
impacted by approved loans 45 Total number of
cities impacted by approved loans once networks
are built and lit 150 Total number of loan
applications received in last 12 months
25 Total amount of approved projects
17.7M Total amount in project pipeline
(approved, received and expected 05
applications) 35 to 40M
18
For More Information www.broadbandauthority.org
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