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John “Jack” Helin
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TAB 5
The city is working to build in some conditions to protect its investment, Helin said. Before
giving its $150,000, the city will ask that SeQuin file an application with the federal Food and
Drug Administration for approval of the product. The company must have at least two prototypes
built and a letter of intent on future purchase orders. The state will request similar provisions,
including a Medicare reimbursement number or reimbursement authorization from several
private insurance companies.
In addition, the state requires a letter of intent that a customer will buy at least 24 beds. It also
wants the company to show evidence that it will spend at least $500,000 on equipment and
working capital expenses. To protect its building investment, the city will retain ownership of the
building and require guaranteed lease payments. The city has also asked for 6 percent equity, in
the form of stocks, in the company. Details of the plan are still being worked out, said Cliff
Mesner, city attorney. "Don't consider this a done deal," he said.
Some decisions will include the size of the building. Originally it was thought to be 20,000
square feet, but Mesner said the city could not afford it. The state pledged money for at least
10,000 square feet, and the city would pay for additional construction costs for a larger building.
For the deal to go through, the first step is getting local investors lined up. A March 1 deadline
for the city's commitment is sought by the company, as well as a March 31 deadline for the
state's commitment. Mesner said that was optimistic. The project requires approval from the city
council, the Department of Economic Development and the governor.
Completed by:
Levon Little’
Colin Baenziger & Associates
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