1. E XPORT -I MPORT B ANK of the U NITED S TATES E XPORT -I MPORT B ANK of the U NITED S TATES Jobs Through Exports Export-Import Bank Intro & Medium-Term Program Overview Xiomara Creque Regional Director Global Business Development Tues. July 27, 2010

2. Introduction to Export-Import Bank The Export-Import Bank (Ex-Im Bank) is the U.S. government’s official export credit agency (ECA) Our mission is to assist finance the export of U.S. goods and services to international markets Since Ex-Im Bank’s founding in 1934, we have supported more than $400 billion in U.S. exports

3. Introduction (continued) Ex-Im Bank assumes credit and country risks the private sector may be unable or unwilling to accept without support Often, we help level the playing field for U.S. exporters by matching the financing other governments provide to their exporters Ex-Im Bank and its ECA counterparts are sometimes referred to as “lenders (or insurers) of last resort”

4. Total Worldwide Portfolio In fiscal year (Oct. 1-Sep. 30) 2009, we approved 2,891 transactions valued at $21billion, which supported an estimated $26.4 billion in U.S. exports to markets worldwide. Ex-Im Bank authorized $4.4 billion in direct support to U.S. small-businesses as primary exporters. There were 515 small-business first time users of Ex- Im Bank programs.

5. Total Worldwide Portfolio

6. Portfolio by Sector

7. Reasonable Assurance of Repayment  We must always establish a reasonable assurance of repayment to approve a transaction  A key element of this is the applicant performing its own due diligence prior to submitting a request – i.e. “Know Your Transaction” (KYT) (http://www.exim.gov/pub/pdf/Due-Diligence- Guidelines.pdf)

8. Financing Coverage Pre-Export Financing Post-Export Financing Working Capital Guarantees Insurance Guarantees Direct Loans

9. Medium-Term Program  Covers new U.S.-made capital equipment and related services  Enables intl. buyers to obtain loans from lenders  Refurbished equipment, software, banking and legal fees, up to 30% in local costs may also be eligible  Transactions eligible: < $10 million  Max tenor: up to five (5) years  Costs: one (1)-time flat “exposure” fee, which may be financed and (for guarantees) commitment fee of 0.125% p.a. that acrues 60 days post-approval  Availability: refer to our Country Limitation Schedule (http://www.exim.gov/tools/country/country_limits.cfm)

10. Medium-Term Credit Standards (MTCS) Criteria when considering foreign buyers (borrowers):  Minimum three (3)-year operating history  Reliable financial statements  Achieve certain financial ratios:  Positive Operating Profit during last 2 years  Positive Net Income during last 2 years  Positive Cash-Flow-From-Operations (latest year)  EBITDA/Debt Service > 150%  Total Liabilities/Total Net Worth < 175%  Ex-Im Bank Exposure/Total Net Worth < 40% (http://www.exim.gov/pub/pdf/ebd-m-39.pdf)

11. Medium-Term Insurance and Guarantees U.S. Supplier EX-IM Foreign Buyer Bank (U.S. or Intl) Payment Goods & Services Loan Guarantee Financials

12. MT Program Repayment Terms Contract Price Max Tenor <$80,000 Two (2) years $80,000 to <$175,000 Three (3) yrs $175,000 to <$350,000 Four (4) yrs $350,000 to $10 million Five (5) yrs

13. Loan Guarantees  MT guarantees cover commercial lenders against repayment risks on a foreign buyer’s debt obligation  Guarantees commit full faith and credit of U.S. government  Guaranteed loans are fully transferable (i.e. may be securitized)  Offer protection of 100% on the principal and interest of 85% of commercial contract – foreign buyers are required to make 15% cash payment  Guaranteed lenders have signed a Master Guarantee Agreement (MGA) with Ex-Im Bank  These lenders offer foreign buyers fixed or floating rate loans – typically floating rate based on spread over 6-month USD LIBOR

14. Example of Insurance or Guarantee Finance Model* Net contract price $1,000,000 Cash payment ($150,000) Financed portion $850,000 Exposure fee @ 1.75% +$14,875 Total financed $864,875 * For direct loans, Commercial Interest Reference Rates (CIRR) – http://www.exim.gov/tools/cirr_rates.cfm

15. Ex-Im Bank Exposure Fee Level of Country: (1-7)2 Percentage of Cover:100.0% Product: (MT Insurance = 2, Loan or Guarantee = 3)3 Repayment Period: (Years)5.00 Drawdown Period: (Months)6 Financed? (Y/N)Y Paid: Up Front (F) or As Drawn (D)D Exposure Fee Is: Transaction Risk Increment 012345 1.50 % 1.67 % 1.84 % 2.00 % 2.18 % 2.35 % 2.52 % (Political Only) (Sovereign) (Non-Sovereign -------------------------------------------------------------------------------------------->) Exposure Fee Calculator

16. Structured Finance Approach  Can do medium or long-term repayment  Use existing corporate balance sheet and add elements of traditional project finance  Level of structuring tailored for each transaction  For smaller projects this approach lowers transaction costs compared to traditional project finance

17. Environmental Exports Program  Maximum OECD repayment term for Long-Term Loans and Guarantees of 10-15 years after project completion.  Repayment terms of 15-18 years for renewable energy and water treatment projects!!  Capitalization of interest during construction.  Up to 15% local cost support within the U.S. scope of supply.  RESULTS: Transactions approved under the Program grew from

18. Support for Renewable Energy Exports  Ex-Im Bank often plays a critical early- stage role in helping small clean energy companies finance their operations.  Powerlight, GT Solar, Evergreen Solar, and Southwest Windpower examples of companies that received early-stage financial support from Ex-Im Bank, and who went on to attract substantial equity investment.

19. Small Solar Power Project – Example  Project:  1 MW solar power project in South Korea  The key elements of the transaction:  U.S. exporter: PowerLight Corporation, California  Guaranteed lender: City National Bank, California  Borrower: S&P Corporation – a private sector Korean company established to own and operate the Project  Guarantors: 2 relatively small private sector Korean companies  Ex-Im guaranteed loan amount: approx. $7.8 million  Repayment Period: 15 years under EEP  Source of Loan Repayment: revenue stream from local electricity retailer, corporate guarantees and security and collateral

20. How to Apply Preliminary/Final Commitment, application, Attachment G, plus a few items that are listed in “Attachment F: Project and Structured Finance”. www.exim.gov Export Import Bank of the United States