Work with Across Nations :

It's as easy as 1-2-3

Step 1.      From day 1st we will assist you in finding out whether your case
                  qualifies for a 504 loan.

• An operating, for-profit business, organized as a Corporation, Sole Proprietorship, Partnership, LLC, etc.
• Combined with affiliates, have a tangible net worth of less than $8.5 million and 2 years average net income after taxes less than $3 million.

Across Nations Pioneers will work with you on evaluating whether your borrower’s business qualifies for the SBA 504 Loan Program.

Step 2.      We will support your borrower with financing of up to 90% of
                  the project cost.

• Refinance
• Purchase of Buildings
• Purchase of Land
• Purchase of Machinery
• Building Extension
• Some of soft costs covered by the SBA 504 loan are: (Appraisal, Environmental Report, Architectural costs and most of closing costs).

Project Cost is not limited to Purchase Price or Appraisal Value: it also includes costs involved with moving, renovation, new machineries and even refinance for up to 50%
of project.

Step 3.      You can give to your borrower a lowest fixed blended interest
                  rate.

• Low LTV allows bank to be competitive on pricing/terms Fully amortizing
  20-year loan
• With Across Nation’s fully underwriting package include Federal Debenture.

The Partner lender provides mortgage funding of 50% of the total project cost, while Across Nations funding will provide 40% of the project cost
(the second deed of trust at a below-market fixed interest rate).

A Presentation on Behalf of the CDCs SBA 504

What is 504 ???

• Economic Development Financing Tool

- Finances Fixed Assets for Healthy, Expanding Small Businesses
• Community Benefits From :

- Jobs Created
- Increased Tax Base

Typical 504 Structure      $1,000,000

Interest Rate

• 5.45% fixed for 20 years (August 2009 Sale)
• Rate = 10 Year Treasury +Margin of 200 – 250 b.p
  >Margin = Spread to Investor + Servicing Fee (SBA, Colson & CDC)

The Financing Dilemma
Typical Growth Curve

• Growing Sales means
  - Growing A/R
• Cash Requirements also Increase

- Larger Inventory
- Increased Payroll
• With limited cash, how can be needed fixed assets be acquired?

Program Guidelines

Occupancy

• Existing Building = 51%
• New Construction = 60%
  » 20% permanently leased; 20% to be occupied within 10 years

Down Payment

• Typical = 10%
• Start-up = 15%
• Special Use = 15%
• Both = 20%

Fees; Bond Sale Costs

• Fees are added to the 40% 504 portion and financed over 20 years
• Adds apprx. 20 bp to the 504 interest rate on an “APR” basis

Ineligible Uses of Funds

• Working Capital
• Inventory
• Franchise Fees
• Autos/Trucks/Planes

Eligible Businesses

• Most privately held companies will qualify
• Size
  - Net Worth < $8.5 million
  - After Tax Income<$3 million (2 years average)
• For = Profit
• Creates Jobs Or Meets a Public Policy Goal
  - Rural, Increased Productivity, Displaced Business, Export,
    Woman, Minority or Veteran Owned, Commercial Revitalization,
    Compliance with environmental Laws

Eligible Projects

• Real Estate
  - Existing Building
  - Additions & Major Renovations
  - Land/Building Construction
• Machinery & Equipment
  - Minimum 10 Year Life
• Refinance
  - Any debt involve with project (Conventional, 7a and 504 etc.)
  - Up to 50% of total project
• Financing includes both hard and soft costs

Loan Size

• Minimum Project = $ 125,000
• Maximum Project = unlimited
• Maximum 504 Loan = $1,500,000
  - (Except : Public Policy Loan = $2,000,000
    Manufacturing Loans and energy saving Loans = $4,000,000)
• Bank portion can exceed 50%

What does the 1st Trust Lender Do?

• Approval :     Issue term sheet stating rates, maturities, collateral &
                      other terms Process normal bank approval
• Closing :       Option to provide bridge financing & monitor construction
                      Colse with regular bank documents
• 504 Closing : Provide copies of bank docs, appraisal and environmental.
                      Execute 3rd Party Lien holder Agreement and Interim Lender
                      Letter Pay SBA's 0.00% bank fee

How Much Paperwork is Needed for a 504 Loan?

• Essentially the same information that any commercial lender will require including :
  - Historical financial statements/tax returns for the business
  - Business debt schedule
  - Personal financial statements and tax return for the owners
  - History/description of business and owners' resumes
  - Contract to purchase, construction/renovation estimates

What is a Certified Development Company (CDC)?

• Non-Profit(typically) lender certified by SBA to provide the 504 portion of the financing
• Organizations whose primary mission is promoting economic development by
  providing 504 financing to small businesses
• Across Nations CDCs have other governmental financing programs
  available as well