2022-09-15T12:40:40-04:00 2021-12-31 341602442 H & J CERTIFIED PUBLIC ACCOUNTANTS INC 7555 FREDLE DR STE 110 CONCORD OH 44077 990 2021-01-01 341567708 GROWTH CAPITAL CORPORATION GROW 2165922332 1360 EAST NINTH ST RM/STE 950 CLEVELAND OH 44114 JOHN KROPF PRESIDENT/EXEC DIR 2165922343 2022-08-12 true JOHN KROPF XXX-XX-XXXX ROLLAND B STANDISH P00169705 4409512997 2022-08-08 2021 2023-04-26 12:10:37Z JOHN KROPF 1360 EAST NINTH STREET IMG CENTER SUITE 950 CLEVELAND OH 44114 2043974 false X GROWTHCAPITALCORP.COM X 1981 OH TO PROVIDE FINANCING ASSISTANCE TO AREA BUSINESSES AS PART OF AN OVERALL MISSION TO FOSTER ECONOMIC GROWTH AND JOB CREATION IN NORTHEAST OHIO. 9 9 6 25 0 4196 0 2688653 2026596 25613 2411 14967 2718462 2043974 0 0 1042465 951976 0 0 1665938 1085519 2708403 2037495 10059 6479 19450824 4546684 17207524 2296905 2243300 2249779 X TO PROVIDE FINANCING ASSISTANCE TO AREA BUSINESSES AS PART OF AN OVERALL MISSION TO FOSTER ECONOMIC GROWTH AND JOB CREATION IN NORTHEAST OHIO. false false 1845861 2026596 GROWTH CAPITAL BEGAN 2021 TRANSITIONING FROM SUPPORTING SMALL BUSINESSES THROUGHOUT OHIO WITH OUR PPP LENDING TO PROCESSING PPP LOAN FORGIVENESS AS OUR CORE 504/CA BUSINESS WAS STILL VERY SLOW TO GAIN TRACTION. OUR FIRST QUARTER LOAN PRODUCTION WAS DISMAL WITH JUST SIX (6) LOAN APPROVALS IN THE FIRST QUARTER OF FISCAL YEAR 2021. WHILE CA LOAN ACTIVITY WAS STILL QUITE DEPRESSED INTO CALENDAR YEAR 2021 LOAN DEMAND FOR OUR 504 PROGRAM BEGAN TO PICK UP IN QUARTER TWO PROVIDING QUITE AN OPERATIONAL CHALLENGE AS THERE WAS STILL MORE THAN 200 PPP LOANS TOTALING APPROXIMATELY 12.5MM OUTSTANDING IN 2021. OUR CORE SBA 504 BUSINESS TOOK OFF IN THE SUMMER MONTHS AND OUR BANKING PARTNERS ARE RECOGNIZING THE CREDIT ENHANCEMENT AND HISTORICALLY LOW RATES OF OUR LENDING AND WE FINISHED THE YEAR VERY STRONG WITH 51 504 LOANS AFTER A VERY SLOW START AVERAGING ABOUT 5 SBA 504 LOAN APPROVALS PER MONTH AFTER THE FIRST QUARTER AND ONCE AGAIN EARNED THE NUMBER ONE CDC IN OHIO. WHILE THE 51 TOTAL LOANS WAS A JUST A FEW OFF OUR HIGH EVER OF 56, WE WERE ABLE TO GENERATE OVER 37.4MM IN TOTAL LOAN APPROVALS WHICH TRANSLATES INTO YET ANOTHER RECORD YEAR OF LOAN PRODUCTION. OUR COMMUNITY ADVANTAGE LENDER WAS MUCH MORE TEMPERED BUT AFTER HAVING JUST 2 CA LOANS FOR 275M APPROVED THROUGH JUNE OF 2021 WE FINISHED THE FISCAL YEAR 9/30/21 VERY STRONG WITH OUR FINAL CA NUMBERS HITTING 10 LOAN APPROVALS FOR OVER 1.8MM KEEPING OUR OVERALL CA LENDING TO LMI AND SBA UNDERSERVED MARKETS TO 88% AND 75% RESPECTIVELY AND ADVANCING OUR MISSION IMPACT. ADDITIONALLY, WE WERE ABLE KEEP OVERALL LOAN DELINQUENCY IN CHECK WITH MODEST INCREASES IN GUARANTEE PURCHASES ALONG WITH SEVERAL LOAN COLLATERAL LIQUIDATIONS THAT HELPED MINIMIZE CREDIT LOSSES. FINALLY, OUR FINANCIAL RESULTS WERE EXTREMELY STRONG GENERATING REVENUE IN EXCESS OF 2.0MM FOR JUST THE SECOND TIME IN OUR NEARLY FORTY YEAR OPERATING HISTORY DESPITE LOSING OVER 11MM IN 504 PORTFOLIO OUTSTANDING TO A DEARTH OF PAYOFFS AND THE RESULTING LOSS OF SERVICING INCOME. WE ALSO LOST OHIO REGIONAL 166 INCOME WHEN WE DECLINED TO RENEW OUR CONTRACT WITH THE STATE BUT OUR STRONG FINANCIAL RETURN HAS PROVIDED THE CAPITAL THAT WILL ALLOW US TO INCREASE OUR LOAN LOSS RESERVES CONSIDERABLY AND WORKING TOWARD MITIGATING ANY CREDIT AND FINANCIAL RISKS FROM THE POTENTIAL INCREASE IN CA LOAN DELINQUENCIES CAUSED BY ECONOMIC UNCERTAINTIES. LASTLY, WE WERE ABLE TO RETIRE OVER 13MM IN PPP DEBT IN 2021 VASTLY IMPROVING OUR LEVERAGE AND WE CURRENTLY SIT ON SUFFICIENT LIQUIDITY TO ACTUALLY RETIRE OUR ENTIRE CA DEBT WITH SUFFICIENT OPERATING CASH AVAILABLE FOR OPERATIONS. WE HAVE A STRONG BALANCE SHEET WITH GOOD EQUITY THAT CERTAINLY DEMONSTRATES SOUND FINANCIAL MANAGEMENT AND STEWARDSHIP OF OUR RESOURCES. 1845861 false false false false false false false false false false false false false false true true false false false false false false false false false false false false true false false false false false true false true false false false false false false false false true 4 0 true 6 true false false false false true true false false false X 9 9 false false false false true true true true true false false true true true true true true true true false X JOHN KROPF 2165922332 1360 EAST NINTH STREET IMG CENTER SUITE 950 CLEVELAND OH 44114 JOHN KROPF PRESIDENT/EX 40.00 X 263889 0 62828 JUAN HERNANDEZ BUSINESS DEV 40.00 X 150747 0 22700 JEFFREY SOZIO SBA LOAN OFF 40.00 X 129499 0 29736 ALAN SCHEUFLER PRESIDENT 3.00 X X 0 0 0 DANIEL PRENDERGAST TREASURER 3.00 X X 0 0 0 TIMOTHY BRECKNER DIRECTOR 1.00 X 0 0 0 GLORIA GATES DIRECTOR 1.00 X 0 0 0 WESLEY GILLESPIE DIRECTOR 1.00 X 0 0 0 MJ HILKER DIRECTOR 1.00 X 0 0 0 STEVEN LORENZ DIRECTOR 1.00 X 0 0 0 KEVIN SCHMOTZER DIRECTOR 1.00 X 0 0 0 ANGELA WILCOXSON DIRECTOR 1.00 X 0 0 0 544135 115264 3 false true false ROETZEL ANDRESS 1375 EAST NINTH STREET CLEVELAND OH 44114 LEGAL 147737 1 504 LENDING AND SERVICING ACT 522298 1395051 1395051 7(A) LENDING ACTIVITIES 522298 423273 423273 SBA LENDER REVENUE - PPP 522298 190994 190994 166 LENDING AND SERVICING ACT 17278 17278 2026596 2411 2411 ANNUAL MEETING 900099 14967 14967 14967 2043974 2043974 284998 199499 85499 471704 453807 17897 57205 49388 7817 88895 76748 12147 49174 42455 6719 141563 141563 35244 35244 7088 7088 78639 70775 7864 93914 84523 9391 158596 150666 7930 22519 21393 1126 213762 213762 PROV LOAN LOSS RESERVE 212450 212450 LOAN SERVICING EXPENSE 117752 117752 SBA LOAN GUARANTEE EXP 3992 3992 2037495 1845861 191634 0 5043142 2333973 948741 1089004 68406 12854 13312282 1039265 11095 14978 67158 56610 19450824 4546684 267967 222840 16939557 2074065 17207524 2296905 X 2243300 2249779 2243300 2249779 19450824 4546684 X 6479 X false true X true false X 2043974 2043974 2043974 2037495 2037495 2037495 SCHEDULE D, PAGE 3, PART X GROWTH CAPITAL IS INCORPORATED AS A NOT-FOR-PROFIT ORGANIZATION UNDER CHAPTER 17 OF THE OHIO REVISED CODE, IS EXEMPT FROM FEDERAL INCOME TAXES UNDER INTERNAL REVENUE CODE SECTION 501(C)(4). GROWTH CAPITAL'S POLICY IS TO RECORD A LIABILITY FOR ANY TAX POSITION TAKEN THAT IS BENEFICIAL TO THE GROWTH CAPITAL, INCLUDING PENALTIES AND INTEREST, WHEN IT IS MORE LIKELY THAN NOT THE POSITION TAKEN WILL BE OVERTURNED BY A TAXING AUTHORITY UPON EXAMINATION. MANAGEMENT BELIEVES THERE ARE NO SUCH POSITIONS AS OF DECEMBER 31, 2021 AND, ACCORDINGLY, NO LIABILITY HAS BEEN ACCRUED. SCHEDULE D, PAGE 4, PART XI, LINE 2D SPECIAL EVENT EXPENSE 0 SCHEDULE D, PAGE 4, PART XII, LINE 2D SPECIAL EVENT EXPENSE 0 X true true X X X false false false false false false false false false JOHN KROPF PRESIDENT/EXEC DIR 174031 89858 30000 32828 326717 JUAN HERNANDEZ BUSINESS DEV DIR 115747 35000 5180 17520 173447 JEFFREY SOZIO SBA LOAN OFFICER 99499 30000 6030 23706 159235 SEE BELOW false SCHEDULE L, PART V PART IV - LINE 28C: MEMBERS OF THE BOARD AND CERTAIN STANDING COMMITTEES INCLUDE EMPLOYEES OF LENDING INSTITUTIONS WHO MAY BE A PARTY TO THE LOAN AGREEMENT WITH AN APPLICANT. GROWTH CAPITAL'S POLICY IS FOR THESE APPLICABLE MEMBERS TO ABSTAIN FROM VOTING ON APPROVAL OF THESE APPLICANTS. FORM 990, PAGE 2, PART III, LINE 4A GROWTH CAPITAL BEGAN 2021 TRANSITIONING FROM SUPPORTING SMALL BUSINESSES THROUGHOUT OHIO WITH OUR PPP LENDING TO PROCESSING PPP LOAN FORGIVENESS AS OUR CORE 504/CA BUSINESS WAS STILL VERY SLOW TO GAIN TRACTION. OUR FIRST QUARTER LOAN PRODUCTION WAS DISMAL WITH JUST SIX (6) LOAN APPROVALS IN THE FIRST QUARTER OF FISCAL YEAR 2021. WHILE CA LOAN ACTIVITY WAS STILL QUITE DEPRESSED INTO CALENDAR YEAR 2021 LOAN DEMAND FOR OUR 504 PROGRAM BEGAN TO PICK UP IN QUARTER TWO PROVIDING QUITE AN OPERATIONAL CHALLENGE AS THERE WAS STILL MORE THAN 200 PPP LOANS TOTALING APPROXIMATELY 12.5MM OUTSTANDING IN 2021. OUR CORE SBA 504 BUSINESS TOOK OFF IN THE SUMMER MONTHS AND OUR BANKING PARTNERS ARE RECOGNIZING THE CREDIT ENHANCEMENT AND HISTORICALLY LOW RATES OF OUR LENDING AND WE FINISHED THE YEAR VERY STRONG WITH 51 504 LOANS AFTER A VERY SLOW START AVERAGING ABOUT 5 SBA 504 LOAN APPROVALS PER MONTH AFTER THE FIRST QUARTER AND ONCE AGAIN EARNED THE NUMBER ONE CDC IN OHIO. WHILE THE 51 TOTAL LOANS WAS A JUST A FEW OFF OUR HIGH EVER OF 56, WE WERE ABLE TO GENERATE OVER 37.4MM IN TOTAL LOAN APPROVALS WHICH TRANSLATES INTO YET ANOTHER RECORD YEAR OF LOAN PRODUCTION. OUR COMMUNITY ADVANTAGE LENDER WAS MUCH MORE TEMPERED BUT AFTER HAVING JUST 2 CA LOANS FOR 275M APPROVED THROUGH JUNE OF 2021 WE FINISHED THE FISCAL YEAR 9/30/21 VERY STRONG WITH OUR FINAL CA NUMBERS HITTING 10 LOAN APPROVALS FOR OVER 1.8MM KEEPING OUR OVERALL CA LENDING TO LMI AND SBA UNDERSERVED MARKETS TO 88% AND 75% RESPECTIVELY AND ADVANCING OUR MISSION IMPACT. ADDITIONALLY, WE WERE ABLE KEEP OVERALL LOAN DELINQUENCY IN CHECK WITH MODEST INCREASES IN GUARANTEE PURCHASES ALONG WITH SEVERAL LOAN COLLATERAL LIQUIDATIONS THAT HELPED MINIMIZE CREDIT LOSSES. FINALLY, OUR FINANCIAL RESULTS WERE EXTREMELY STRONG GENERATING REVENUE IN EXCESS OF 2.0MM FOR JUST THE SECOND TIME IN OUR NEARLY FORTY YEAR OPERATING HISTORY DESPITE LOSING OVER 11MM IN 504 PORTFOLIO OUTSTANDING TO A DEARTH OF PAYOFFS AND THE RESULTING LOSS OF SERVICING INCOME. WE ALSO LOST OHIO REGIONAL 166 INCOME WHEN WE DECLINED TO RENEW OUR CONTRACT WITH THE STATE BUT OUR STRONG FINANCIAL RETURN HAS PROVIDED THE CAPITAL THAT WILL ALLOW US TO INCREASE OUR LOAN LOSS RESERVES CONSIDERABLY AND WORKING TOWARD MITIGATING ANY CREDIT AND FINANCIAL RISKS FROM THE POTENTIAL INCREASE IN CA LOAN DELINQUENCIES CAUSED BY ECONOMIC UNCERTAINTIES. LASTLY, WE WERE ABLE TO RETIRE OVER 13MM IN PPP DEBT IN 2021 VASTLY IMPROVING OUR LEVERAGE AND WE CURRENTLY SIT ON SUFFICIENT LIQUIDITY TO ACTUALLY RETIRE OUR ENTIRE CA DEBT WITH SUFFICIENT OPERATING CASH AVAILABLE FOR OPERATIONS. WE HAVE A STRONG BALANCE SHEET WITH GOOD EQUITY THAT CERTAINLY DEMONSTRATES SOUND FINANCIAL MANAGEMENT AND STEWARDSHIP OF OUR RESOURCES. FORM 990, PAGE 6, PART VI, LINE 6 GROWTH CAPITAL MAINTAINS A MEMBERSHIP OF AT LEAST 25 PERSONS ELECTED FROM EACH OF THE FOLLOWING FOUR GROUPS: (I) GOVERNMENT; (II) PRIVATE SECTOR LENDING INSTITUTIONS, (III) COMMUNITY ORGANIZATIONS; AND (IV) BUSINESS ORGANIZATIONS. FORM 990, PAGE 6, PART VI, LINE 7A IF IT IS NECESSARY TO ELECT ADDITIONAL MEMBERS, AN APPOINTED OFFICER OF THE BOARD SHALL NOTIFY THE BOARD CHAIR WHO IMMEDIATELY APPOINTS A COMMITTEE FROM AMONG THE BOARD. NOMINATIONS ARE REPORTED AND NEW MEMBERS ARE ELECTED AT A MEETING OF THE MEMBERS WHERE A QUORUM IS PRESENT AND BY AN AFFIRMATIVE VOTE BY A MAJORITY OF THOSE MEMBERS PRESENT. FORM 990, PAGE 6, PART VI, LINE 7B THE MEMBERS ELECT THE BOARD OF DIRECTORS AND NEW MEMBERS. FORM 990, PAGE 6, PART VI, LINE 11B THE 990 IS PREPARED BY AN INDEPENDENT CPA AND THEN PRESENTED TO THE FINANCE COMMITTEE, FINANCE STAFF, AND THE EXECUTIVE DIRECTOR FOR REVIEW AND APPROVAL. THE COMPLETE RETURN IS THEN ELECTRONICALLY DISTRIBUTED TO THE BOARD OF DIRECTORS FOR REVIEW PRIOR TO FILING WITH THE IRS. AN OFFICER SIGNS THE 990. FORM 990, PAGE 6, PART VI, LINE 12C EACH YEAR, THE BOARD MEMBERS ARE ASKED TO REVIEW THE ORGANIZATION'S CONFLICT OF INTEREST POLICY. AMONG OTHER THINGS, THE POLICY MAKES CLEAR THAT ALL DECISIONS OF THE BOARD, OFFICERS, AND EMPLOYEES OF THE ORGANIZATION ARE MADE SOLELY ON THE BASIS OF A DESIRE TO PROMOTE THE BEST INTEREST OF THE ORGANIZATION AND THE PUBLIC GOOD. THE CONFLICT OF INTEREST STATEMENT REQUESTS BOARD MEMBERS TO IDENTIFY TO THE BEST OF THEIR KNOWLEDGE AFFILIATIONS WITH ORGANIZATIONS THAT MAY BE POTENTIALLY RELATED TO THE FINANCIALS OR OTHER SUBSTANTIVE OPERATIONS OF THE ORGANIZATION. THEY ARE ALSO ASKED TO IDENTIFY CIRCUMSTANCES INVOLVING EITHER THEMSELVES, OR A MEMBER OF THEIR EXTENDED FAMILY, THAT MAY BE CONSTRUED AS A CONFLICT OF INTEREST. AT THE STAFF LEVEL, THE ORGANIZATION'S PERSONNEL ALSO ENSURE THAT THERE ARE NO CONFLICTS OF INTEREST WHEN CONSIDERING THE ENGAGEMENT OF A NEW VENDOR. IF A POTENTIAL CONFLICT IS IDENTIFIED, APPROPRIATE STEPS ARE TAKEN TO BOTH ASSESS THE NATURE OF THE POTENTIAL CONFLICT AND, SUBSEQUENTLY, TO ENSURE THAT THE POSSIBILITY OF AN ACTUAL CONFLICT IS MITIGATED. SUCH MITIGATION IS MANAGED AND THE LETTER AND SPIRIT OF THE CONFLICTS POLICY ARE UPHELD. FORM 990, PAGE 6, PART VI, LINE 15A THE EXECUTIVE COMMITTEE ANNUALLY EVALUATES THE PERFORMANCE OF THE EXECUTIVE DIRECTOR. COMPENSATION IS BASED ON PERFORMANCE AND COMPARED TO OTHER STATE AND NATIONAL SBA LENDERS AS WELL AS LOCAL BANKING INDUSTRY COMPENSATION LEVELS. THE BOARD HAS ADOPTED THE IRS-WRITTEN "REBUTTABLE PRESUMPTION" CHECKLIST WHICH IS COMPLETED CONTEMPORANEOUS WITH THE PERFORMANCE REVIEW BY THE EXECUTIVE COMMITTEE. FORM 990, PAGE 6, PART VI, LINE 15B COMPENSATION FOR STAFF WITHIN THE ORGANIZATION IS DETERMINED BY THE EXECUTIVE DIRECTOR. COMPENSATION IS BASED ON PERFORMANCE AND COMPARED TO OTHER STATE AND NATIONAL SBA LENDERS AS WELL AS LOCAL BANKING INDUSTRY COMPENSATION LEVELS. THIS COMPENSATION IS A COMPONENT OF THE BUDGET, WHICH IS REVIEWED AND APPROVED BY THE EXECUTIVE AND FINANCE COMMITTEES AND ALSO BY THE BOARD AS A WHOLE. FORM 990, PAGE 6, PART VI, LINE 19 THE ORGANIZATION'S CURRENT GOVERNING DOCUMENTS, FORM 990 CONFLICT OF INTEREST POLICY AND FINANCIAL STATEMENTS ARE MADE AVAILABLE TO THE PUBLIC UPON REQUEST. THE FORM 990 CAN ALSO BE FOUND ON SEVERAL PUBLICALLY- ACCESSIBLE WEBSITES. FORM 990, PART XI, LINE 9 SPECIAL EVENT EXPENSE 0 SPECIAL EVENT EXPENSE 0