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Pre-Export FinancingWorking Capital Guarantee ProgramThankyouforjoiningus,theWebinarwillbeginshortlyWhileyouarewaitingpleasecheckouttheupcomingwebinarson

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Pre-Export FinancingWorking Capital Guarantee ProgramNOVEMBER 10, 2016

XiomaraCreque-BrombergExportFinanceManagerintheOfficeofMinorityandWomenOwnedBusinessesofEXIM’sSmallBusinessGroup• Sheconductsbusinessdevelopmentmissions,visitsEXIMprospects,costumers,banks,organizationsandspeaksbeforeexportingandinternationalgroups.• Morethan25yearsofexperienceinthebankingandcorporatesector,shehasmanagedaportfoliocomprisedofgroundbreakinginfrastructure,oil&gasandenergyprojectsintheAmericas.

Today’s Presenter

Note: Provides no protection to exporter against foreign buyer non-payment

Working Capital Guarantee Program – Basic Parameters

Ø90 % Guarantee on principal and interest for export-related inventory and A/R

§ Guarantee also covers certain liquidation costs

ØGenerally one year or less

ØMust be fully collateralized

ØCovers exporter performance risk

Lines of Credit

ØTransaction Specific

ØTransaction Specific Revolving

ØRevolving§ Multiple transactions or specifically

identified ones§ May be committed for up to 3 years

with annual reviews

U.S. Content Policy

ØGoods must have at least 50% U.S. content to guarantee the entire transaction

ØExports must be manufactured in and shipped from the U.S.

Lender Benefits

ØExpand services to existing customersØAttract new customersØIncrease profitØImprove credit’s risk ratingØMeet CRA requirements with limited risk

Exporter Benefits

ØIncrease sales/profitsØExpand collateral base

§ Export-related inventory, including WIP

o Supports Standby L/Cs, Bid and Performance Bonds

§ Export-related accounts receivable

Expansion of your Client’s Collateral Base

Sectors Supported

19%

18%

15%

12%

10% 9% 9%

8%

Frozen Foods Medical Equipment/Devices

Electrical Instruments Telecommunications

Air Quality Equipment Testing Equipment

Lumber and Millwork Transportation Equipment

Type of Exporters

ØManufacturersØTrading CompaniesØWholesalers/DistributorsØService Companies

Eligible U.S. Exporters

Ø Reasonable assurance of repayment§ Minimum 1 year operating history

§ Debt service ability

§ Adequately capitalized relative to requested loan amount

Ø Business operations in the U.S.Ø Indirect exporters

§ 100% of line of credit

Borrower Profile

Ø Tight liquidity, negative cash flowØ Losses or erratic earningsØ Minimal net worth; short operating historyØ Large contract in relation to balance sheetØ Collateral shortfall; WIP financing needed

Use of Financing

L/Cs, Bid and Performance Bonds

Ø Commercial or Standby (Domestic and Foreign)§ Collateralized at 25% (10% prior approval)

§ Term cannot exceed loan term

Ø Warranty Letters of Credit§ Lender must extend other credit

§ 100% collateralized; 25% must be in cash

§ Maximum Amount: 20% of loan up to $1,500,000

§ Term cannot exceed loan term

Paying Off Existing Lines

Ø Initial disbursement may take out existing loan, subject to:§ Borrower’s financial condition

§ Sufficient collateral

§ Additionality guidelines

§ EXIM Bank prior approval

Restrictions on Use of Funds

Ø No disbursements without export orders unless pre-approved; sampling is required

Ø Inventory less than or equal to 60% of outstanding loan on revolving lines

Ø Purchase of fixed assets

Ø Military exports

Ø Off-cover countries

Ø Acquisitions

Eligible Collateral – Export Related A/R

Ø Export-Related Accounts Receivable§ Up to 90% advance rate

§ Remove if >60 days late, 90 days with insurance

§ Sales on terms not to exceed 180 days

Ø Retainage Accounts Receivables have a 25% RateØ Receivables must be in US Dollars

§ A waiver can be requested. Unhedged foreign currency has a 70% advance rate.

Ineligible Collateral – Export Related A/R

Ø No intra-company receivables

Ø No receivables from military organizations

Ø No receivables from prohibited countries

Ø No L/Cs until goods are shipped

Eligible Export Related Inventory

Ø May include raw materials; work-in-progress and finished goods

Ø Must be located in the US

Ø Must be valued at lower of actual cost or market value

Ø Advance rate up to 75%

Collateral for Service Companies

Ø Disbursements allowed against contract related-costsØ Contract and proceeds assigned to lenderØ Requirements

§ 3 years audited or reviewed financial statements

§ Demonstrated ability to perform under contract

Terms of Sale

Ø Cash payment prior to shipping

Ø Irrevocable L/C sometimes confirmed

Ø Receivables insured with export credit insurance (EXIM Bank or other comparable insurance)

Ø Uninsured, open account

Ø Documentary collections

EXIM Bank Fees

Ø Application Fee - $100Ø Facility Fee - Annual

§ 1.75%

Ø Reduced Facility Fee – Annual§ 1.25%

§ At least 4 of 7 RMA Median Standard Met

§ 100% of export receivables are L/C’s or insured

Delegated Authority Activity

Ø Over 98% of our transactions are done by Delegated Authority Lenders

Ø Lender’s are not required to have to EXIM Bank approval before closing

Authorizations

$880$1,095 $1,174 $1,255

$1,381$1,531

$2,178

$3,227 $3,253

$2,599$2,389

$620$850 $918 $990 $1,076

$1,233$1,450

$2,151 $2,074

$1,794 $1,792

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Millions

FiscalYearEnd

WorkingCapitalGuaranteeAuthorizationsFY2004throughFY2014

TotalAuthorizations SmallBusinessAuthorizations

©2015 Export-Import Bank of the United States

www.exim.gov1-800-565-3946 (EXIM)

Contact:Xiomara Creque-BrombergExport Finance Manager Minority and Woman owned BusinessPhone: 202-565-3477Email: xiomara.creque@exim.gov

Questions?

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Forquestions,pleasecontactIvanaPivovarnikatIPivovarnik@wipp.org

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