1. Letter of Credit Basics Seminar Foreign Receivable Financing Programs Davi Tserpelis Senior Vice President Commercial Banking davi.tserpelis@citi.com – 631-265-4484

2. Objective  Provide an overview of government sponsored lending programs available to support cash flow for exporters –Small Business Administration  SBA Export Working Capital Program –Export – Import Bank of the US  EXIM Working Capital Guarantee Program  EXIM Medium-Term Guarantee Program  EXIM Long-Term Guarantee Program  EXIM Financial Institution Buyer Credit Program 2

3. Export Working Capital Programs: Who do they support?  Programs are primarily for small and medium-sized businesses that are U.S. domiciled exporters  Company is a manufacturer, trading company, wholesaler, distributor or a service company  Qualifying businesses: –SBA products- determined by an entity’s industry (NAICS code) and either number of employees or Annual Receipts (in millions) –EXIM products – determined by EXIM Country Limitation Schedule and US content requirements 3

4. Export Working Capital Programs Common qualifying business purpose usage  Finance of foreign accounts receivable  Acquire inventory for export or to be used to manufacture goods for export  Pay the manufacturing costs of goods for export  Purchase goods or services for export  Support standby letters of credit related to export transactions  Working capital directly related to export orders  Support an indirect export. (The borrower’s direct customer is located in the United States and his customer is overseas)  Goods must be shipped from the USA 4

5. EXIM Working Capital Program Standard Structure Basics  Facility Size $1,000,000 minimum  Up to 90% against foreign receivables up to 180 days old (depending on credit insurance) and up to 75% against export related inventory  Typically a one year annually renewable credit line  Monthly borrowing base certificate  Fees vary 5

6. Working Capital Guaranty Program core benefits  Enable clients to grow their export business  Enable clients to borrow against foreign accounts receivable and inventory typically not conventionally financed  Higher leverage and advance rate than conventional financing with government guarantee 6

7. Determining which product is the best fit: EXIM’s WCGP vs. SBA EWCP DescriptionEX-IM Bank WCGPSBA EWCP If product does not meet 50% US contentNoYes Products manufactured abroad 100%NoYes, must be shipped from the USA Defense product or defense customers;NoYes, subject to Citi ‘s credit policy Transaction Specific ( large contract 1-3 buyers) YesNo 90 % advance rate of foreign A/RsYes, dependent on underwriterYes, dependent on underwriter and foreign receivable insurance requirements A/R credit insurance requiredTypically, no, only required in some cases by underwriterYes, but can be mitigated with three or more years of documented positive buyer experience, only 80% advance rate on A/R’s without insurance Use of proceeds To acquire inventory and pay for productions costs; To purchase goods for resale; Delivery of services; To support stand-by letters of credit with reduced (25%) collateral. Yes Loan maxUnlimited$5 MM Loan minimum1MM FeesApplication Fee, Facility fee depends on term of loan: 6 months:.75% of loan amount 12 months: 1.50% of loan amount (The facility fee is reduced if 100% of the borrower’s A/R are either insured or covered by a letter of credit.) or if borrower meets industry medium quartile for 4 out of 7 key ratios SBA charges a guaranty fee of.25% per year Interest rateNegotiable with lenderNegotiable with lender( should include ongoing fee) Requirement to use outside counselYes, only certain approved EXIM lawyersNo, unless required by underwriter Field examinations requiredYes, semi-annual at borrower’s cost, annual with audited financialsNo, (but subject to Citi’s underwriting requirement ) Monitoring of borrowing baseYes 7

8. EXIM Medium-Term/Long-Term Guarantee Program Overview  Term loans for your client to purchase large ticket items from your Company wherein bank has a local presence  Finance refurbished items, construction cost, computer software, engineering cost and some local overseas cost, etc  No defense articles or services, or military buyers and shipped from US  Buyer must be in an eligible country according to EXIM Country Limitation Schedule and bank  Buyer must be in business for at least three years and able to provide current financial statements and three years of audited financial statements  Finance up to 85% of the purchase price or the US content, whichever is less  Finance term between 2 and 5 years for Medium Term and 5-10 for Long Term  Minimum $1,000,000 8

9. Financial Institutional Buyer Credit (FIBC) Program  Allows bank to lend to a foreign buyer of US goods and services on a short- term basis backed by insurance  This policy affords coverage against commercial defaults and political events that result in nonpayment under a buyer obligation.  The policy also provides coverage against political risks such as war, revolution, expropriation or confiscation by a government authority, cancellation of import or export licenses after shipment and foreign exchange inconvertibility, and commercial losses due to protracted default, insolvency of the buyer or failure to reimburse for other reasons. Devaluation is not covered.  Political only coverage is 100%;  Non-sovereign obligors/guarantors, including non-sovereign public sector and private sector financial (non-letter of credit) and non-financial institutions is 90% coverage; and  Approved agricultural commodities are covered at 98% 9

10. How the Lender will support you… Citibank is a preferred lender of programs Educate Company on products and identify best product for Company Help qualify Company for program and process loan request including application completion and underwriting Process Bank and Government Agency Approval Ensure that government agency is notified of loan closing Service relationship and present other complimentary solutions (ex. trade credit, foreign exchange, international banking) 10

11. © 2012 Citigroup Inc. Citibank, N.A. Member FDIC. Citi with Arc Design is a registered service mark of Citigroup Inc. Citigroup is an equal credit opportunity lender. Fees and conditions apply to certain of these products and services. Please contact your Citibank representative for the specific terms that apply to each product and service. All banking, commercial loans and credit lines are provided by Citibank, N.A. (Citibank), an equal opportunity lender, or its banking or lending affiliates. All credit products are subject to satisfaction of Citibank’s underwriting guidelines and credit approval. Fees and conditions, Including minimum balances, apply to some deposit and other products and services described. Treasury products are made available through Citibank. Subject to credit approval. Citibank is an equal credit opportunity lender. Offer subject to change or termination at anytime without notice, and cannot be combined. The terms, conditions and fees for accounts, products, programs and services are subject to change. All accounts and services are subject to approval. Thank You For your Time Today Davi Tserpelis Senior Vice-President Commercial Banking 631-265-4484 davi.tserpelis@citi.com 11