Manufacturer expands 
with SEDA-COG partnership
 
Metal Integrity, formerly Zero-D Precision Machining, was doing so well in State College, the owners decided to expand into a second location in Carbondale. Financing through SEDA-Council of Governments (SEDA-COG) and Kish Bank made this possible.

Owners Marc Dagata and Dan Lutz employ 20 workers between the two locations, and anticipate growth.

"We expect to grow the business significantly and add five to 10 employees as a result," Dagata said.

The Carbondale location is twice the size of the business in State College, so they needed significant financing to buy it. Kish Bank recommended the U.S. Small Business Administration (SBA) 504 loan program through SEDA-COG to spread the debt and risk of this large purchase.

A $200,000 SBA 504 loan assisted in the real estate acquisition of the Carbondale business, and a $333,200 SBA 504 loan assisted in purchasing the equipment. Kish Bank provided the balance of the financing.

"Without SEDA-COG's loan assistance, we probably would not have been able to expand our business. We're very appreciative of the SBA loan program at SEDA-COG that helps businesses like ours that want to grow," Dagata said. "We were ecstatic."

The loan process went smoothly and quickly with SEDA-COG's staff expertise, he said.

"Through (SEDA-COG senior relationship manager) John Reichard's leadership, experience, and knowledge, we overcame questions and challenges very quickly," Dagata said. "Melodee (SEDA-COG loan closing specialist) gave us very detailed instructions about what was needed, so it helped us provide it very quickly."

They completed both loans and closed on the acquisition in less than 90 days without disrupting the existing business. Dagata said they highly recommend businesses use the SBA 504 loan program through SEDA-COG for financing needs.

Kish Bank strives to provide customers with the best tools and support to help them grow their businesses. Kristie McKnight, vice president and commercial relationship manager at Kish Bank in State College, said they were excited to partner with Dagata and Lutz.

"Throughout the course of our conversations with the borrower, we worked through several scenarios on how we could structure the financing to best meet their needs. Through these conversations, we explored the SEDA-COG SBA 504 program, which proved to be an excellent fit within our overall financing package," McKnight said. "The team at SEDA-COG worked quickly and efficiently to pull this financing together to help make our customer's dreams a reality. We are proud to have been a part of this next step with our valued client, and look forward to many more opportunities as their business grows."

Metal Integrity is a contract manufacturer, so they tailor their products to their clients' needs. The State College facility at 341 Airport Road focuses on precision machining, and makes equipment for many industries, including aviation, lab equipment, and industrial components.

The Carbondale facility at 47 N. Scott St. manufactures precision sheet metal components for a wide variety of customers. They are specialists in machining and fabricating, focusing on complicated precision components. They have a highly experienced engineering staff that assists with part designs.

"It's a $50 billion-a-year industry, and we're just trying to carve out our little piece of it - and we're having fun doing it," Dagata said. "Being able to offer a wider mix of products will allow us to better serve our current and future customers."

Dagata and Lutz have been friends for over 25 years and wanted to be in business together because they both have a strong commitment to the customer. They believe in under-promising and over-delivering.

Dagata is company president and manages the business side, and Lutz has over 30 years of engineering and manufacturing experience that allows Metal Integrity to offer design-for-manufacturing services that most shops can't. They bought a business in State College about three years ago and called it Zero-D Precision Machining. Since buying the one in Carbondale, they renamed the business Metal Integrity.

For more information about Metal Integrity, visit www.metalintegrity.com .
SEDA-COG's Business Finance staff can help businesses find the best loan for their needs. Contact SEDA-COG today to start a partnership at 570-524-4491 or finance@seda-cog.org .



 
At Kish Bank, we strive to provide our customers with the best tools and support to help them grow their businesses. When we were presented with the opportunity to be a part of an exciting potential acquisition with our valued customer, Metal Integrity, Inc., we were eager to partner with Marc and Dan.
 
Throughout the course of our conversations with the borrower we worked through several scenarios on how we could structure the financing to best meet their needs. Through these conversations we explored the SEDA-COG SBA 504 program, which proved to be an excellent fit within our overall financing package. The team at SEDA-COG worked quickly and efficiently to pull this financing together to help make our customers dreams a reality. We are proud to have been a part of this next step with our valued client, and look forward to many more opportunities as their business grows.

For over a century, solid and enduring values have made Kish Bank, the banking subsidiary of Kish Bancorp, Inc., a strong financial institution and a vital part of the communities it serves. Kish Bank has been one of Pennsylvania's fastest growing community bank franchises, with assets now in excess of $800 million and 15 offices throughout Centre, Huntingdon, and Mifflin counties. Kish is dedicated to improving the economic well-being and quality of life for our communities by backing small and medium-sized enterprises, encouraging the formation of new enterprises, and supporting informal and newly emerging businesses.

NADCO, the trade association for the nation's Certified Development Companies (CDCs), reports that the effective interest rate for the 20-year debentures decreased from 4.94% in February to 4.92% in March. 

The 10-year effective rate rose from 4.66% in January to 5.11% in March.

The debentures that funded this month's 20-year 504 loans were sold to investors at an interest rate of 3.20%, which is a decrease from February.

For more information about financing real estate projects in Pennsylvania using the SBA 504 program, visit  www.sedacogldc.org or contact one of our staff.

Loan
Rate
Effective
SBA 504
5.11%
March 10-year loan
SBA 504
4.92%
March 20-year loan
SEDA-COG PIDA
3.5%
Through March 31, 2018
SEDA-COG RLF/TEAM
4%
Through March 31, 2018

SEDA-COG's Business Finance Department serves the entire state of Pennsylvania for the SBA 504 Loan Program.
 
SEDA-COG serves an 11-county area in central Pennsylvania including Centre, Clinton, Columbia, Juniata, Lycoming, Mifflin, Montour, Northumberland, Perry, Snyder, and Union counties.  
 
For more information, visit www.seda-cog.org/finance or www.sedacogldc.org.

Contact our Business Finance staff today!

Senior Relationship Manager II
Business Finance Director


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