MONARCH CAPITAL

Business Financing Solutions

Offered by

MONARCH CAPITAL PARTNERS

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Any enterprise is built by wise planning, becomes
strong through common sense, and profits
wonderfully by keeping abreast of the facts.
Proverbs 24:3-5 TLB

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Table of Contents

Video Introduction pg. 2
Who are we pg. 4
Product offering pg. 5
Merchant Cash Advance pg. 5
ACH Cash Advance pg. 8
Equipment leasing pg.10
Equipment Financing pg.14
International Trade pg.17
Letters Of Credit pg.18
Purchase Order Financing pg.19
Factoring pg.20
Forfeiting pg.22
Escrow Global Trade Financing pg.25
Merchant Terminal Solutions pg.25
Mezzanine Loan financing pg.26
Hard Money Loans pg.27
Construction Loans pg.29
REO Loans pg.31
Private Equity Financing pg.32
ATM Placements pg.33

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Who are we?

The financiers and purveyors of financial solutions for business owners and
commercial real estate investors.

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Our Target Markets

We provide financial solutions to the below
markets in various forms

 SMALL BUSINESS WORKING CAPITAL LOANS
 MID MARKET WORKING CAPITAL LOANS
 LARGE BUSINESS WORKING CAPITAL LOANS
 COMMERCIAL REAL ESTATE FINANCING

Products Offered

 MERCHANT CASH ADVANCE  MERCHANT TERMINALS
 EQUIPMENT LOANS  MEZZANINE LOANS
 EQUIPMENT LEASING  HARD MONEY LOANS
 MERCHANT LINES OF CREDIT  CONSTRUCTION LOANS
 ACCOUNTS RECEIVABLE FINANCE  REO LOANS
 MERCHANT CUSTOMER CREDIT  PRIVATE EQUITY FINANCING
 ATMS
LINES
 INTERNATIONAL TRADE FINANCE

Merchant Cash Advance

What is it?

A burgeoning $10B Industry.
This is a source of funding that businesses can utilize to bridge the gap for
immediate cash flow needs. It is an advance of cash to a business merchant
from a financier on future accounts receivables also known as trade
receivables as a result of credit or debit card sales.

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Terms

 Must be taking credit cards payments
 In business & transacting credit cards for at least 60 days
 Transacting a minimum of $5000 in credit card payments monthly
 3-6 months credit cards processing statements
 3-6 months banks statements
 Any Fico
 Bad credit, not a deterrent

Advance Amounts

$5000- $4MM

Industries We Serve

Retail

 Retail Shops
 Liquor Stores
 Sports Apparel
 Grocery Stores

Auto & Transportation

 New and used auto sales
 Auto repair
 Trucking & Logistics
 Transporters
 Freight and cargo shippers

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Construction

 General contracting
 Roofing
 Plumbing
 Electrical contractors
 Remodeling
 Woodworking

Hospitality

 Restaurants/Bars
 Catering
 Salons
 Spas
 Hotels/Motels
 Event Venues

Medical

 Doctor's Offices
 Specialists
 Dental Offices
 Clinics
 Emergency and Non-Emergency Transportation

Others

 Day Care-Centers.
 Wholesalers
 Service Providers
 & MORE!

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How to Sell It

 Immediate need for cash  Bank loans a hassle
 We fund A,B,C & D Paper  Requires financing but not
 Cash flow challenges
 Meet payroll interested in bank loans
 Pay Taxes  Not a loan
 Marketing Needs  Advance on existing
 Less than stellar credit
 New in business business

How Is It Repaid

You agree to a fixed percentage of your daily credit card payments accounting
for the loan plus the fee to be taken back by the funder each day.

ACH Business Cash Advances

What is it?

A $10B+dollar business
Where merchant Cash Advances are based on receivables to the business ACH is
based on the cash flow funds in the business checking account as per the
average daily balance. Once the funds are underwritten and granted to the
merchant they are authorized to either daily, weekly or monthly debit their
fees and funds from the merchant’s account until they are fully repaid.

Best Suited For:

Commercial and retail merchants with cash flow challenges
Small business working capital loan
Small business categorized as revenue up to $10M

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Short-term loans operate like traditional term loans in that you receive a
set amount of cash up front that you agree to pay back, along with the
lender’s fees, over a set period of time. However, with short-term loans,
loan amounts tend to be smaller, the repayment period drastically shorter,
and you often pay the lender back daily vs. monthly.

Cost

Short-term loans are paid off quickly, most often with daily payments. That’s
why you’ll often see short-term lenders quote their fees as “factor rates”
(similar to Merchant Cash Advance). So, if you are taking out a $100,000
short-term loan, and the lender has a 1.18 factor rate, that means the total
you will need to pay back is $118,000. Let’s say they’d like you to pay back
the total amount in 12 months, so given that there are 22 payment days in a
month, that’s 264 payments you would have to make. The amount of those
payments would be $446.96, making your actual APR 33.54%.

Who Qualifies

Most small businesses can qualify for a short-term loan, given they are okay
with the higher APR and daily payment structure. The interest rate you’ll pay
and the amount you can borrow depends on your business revenues, your
business history, and your credit rating.

The Details

 Maximum Loan Amount-$2,500 - $250,000
 Loan Term: 3-18 months
 %Interest Rates -Starting at 14%
 Speed- As little as 2 days

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Mid-Market Working Capital Loans

This sector can be defined as any business with revenues between $10MM- $1B.
The Mid market is further segmented into 3 categories;

1. Lower Mid-Market $10MM-$50MM Revenue
2. Middle mid-Market $ 50MM $500MM
3. Upper middle market-$500M-$1B

Equipment Leasing

What Is An Equipment Lease?

An equipment lease, is an agreement under which the owner of the equipment,
conveys to the user, the right to use the equipment, in return for a number
of specified rentals, over an agreed upon time. The OWNER of the equipment is
referred to as the “LESSOR”. The USER of the equipment is referred as the
“LESSEE”. Leasing is a form of business financing. It is an additional
source of credit that allows more efficient use of capital resources.

Why Consider Equipment Leasing?

Equipment leasing may be the best method for acquiring modern technology.
Entrepreneurs and corporations face increasing domestic and foreign
competition. It is important that they are aware of the sources of financing
that are available to support their operations and facilitate continued
growth. A robust economy over the past few years has helped contribute to
growth in the lease financing industry. Equipment leasing services can be
facilitated in all U.S. states and Canada as well as all levels of business
and government. Because of the lack of financial resources available to many
small businesses, equipment lease financing is rapidly growing as an

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alternate source of credit. A properly structured equipment lease will allow
the lessee the opportunity to operate equipment for its useful life, often
for less than a loan payment, with the additional optional benefit of
upgrading to a new model at the end of the lease. Of course, a lessee may
trade-up to new equipment any time during the term of the lease. The lessee
may also take the option of purchasing the piece of equipment they have
leased.

How Does Equipment Leasing Work?

Equipment lease financing is simple and convenient. You do the research and
choose the make and model of equipment best suited for the business
enterprise from the vendor/supplier of your choice, for the best cash deal.
The potential Lessee then completes a credit application and provides
supporting financial information as required. Upon lease credit approval and
acceptance, the Lessor will forward the lease contract for signatures. Once
the lease contract and related documentation are returned to, a purchase
order is issued to the vendor. The vendor then delivers the equipment to the
lessees' place of business. After an independent auditor has confirmed
delivery of the equipment, the financier will pay the supplier and the lease
commences.

Typically, a lease involves no money down, which basically results in 100%
financing. The lease client doesn’t worry about paying taxes up front either,
since they are calculated on the rental. Two rentals and a signed lease
contract seal the deal. On a five-year lease, that amounts to less than 5%
investment. Effective costs compared with conventional bank financing are
close. Those who can take advantage of the tax deductibility of the rentals
can often increase expenses for tax purposes thereby reducing or deferring
the payment of taxes.

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Terms

Tailored to the useful life of the equipment with a fixed rental throughout
the term. Upgrade privileges are standard. Trade up value, or a purchase
option can be predetermined.

What is the minimum size of an equipment lease?

 $1,500.00

So What Is It?!?

An equipment lease, is an agreement under which the owner of the equipment,
conveys to the user, the right to use the equipment, in return for a number
of specified rentals, over an agreed upon time. The OWNER of the equipment is
referred to as the “LESSOR”. The USER of the equipment is referred as the
“LESSEE”. Leasing is a form of business financing. It is an additional source
of credit that allows more efficient use of capital resources.

Who Leases?

Almost every enterprise whether it is a corporation, partnership,
proprietorship, professional, charity, club, society, hospital, service, and
every level of government is a potential lessee. Any businesses that require
up-to-date technology to be competitive can be a lessee. Companies that can
get past the fixation of ownership and realize it is the use, not ownership,
of assets that generate income, are prime candidates for leasing. Many
enterprises have leased some type of equipment …many more have not. There is
no definition of a “typical” lessee.

Why Equipment Leasing?

There is seldom a single reason. It depends very much on the situation of
the enterprise.

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Usually, the motivation to lease is a combination of the following factors.

 Leasing provides up to 100% financing of equipment cost.
 Working capital and credit lines remain free for other uses.
 Reduced costs due to purchase option or fair market value (FMV)

at end of lease.
 After tax costs may be less expensive than other forms of

financing.
 Certainty of a fixed rental for the full term of the lease.
 Pre-determined purchase option and renewal privileges.
 Lease may qualify for off balance sheet accounting.
 Hedge against inflation.
 Leasing may not contravene loan covenants or capital investment

restraints.
 Simplified budgeting and accounting because of fixed rentals.
 Lease rentals may be 100% deductible.
 Quick and easy lease credit procedure and turn-around time.
 Reduced equipment risk.
 Simplified lease documentation.
 Equipment replacement program.
 Operating budget may permit leasing when capital budget does

not.
 Modern equipment can be acquired immediately.
 Taxes not required up front since taxes are calculated on the

rental.
 No down payment
 Seasonal or reduced rental plans available.
 Used or reconditioned equipment leasing is available.

Benefits of Leasing include:

Cash Flow – By making monthly payments, businesses can pay for the equipment
with the improved cash flow generated from their new technology. Leasing
affords a variety of options to match payment terms to business flow of cash,
whether cash flow is project-based, seasonal, related to expansion, etc.

Obsolescence Protection – Leasing allows you to match payment plans to the
equipment’s expected useful life. Leasing provides flexibility at the end of
the term to allow you to either take ownership of the equipment or walk away
and acquire new technology.

Tax Treatments and Benefits – You may be able to write off 100% of your lease
payments from your corporate income because the IRS generally does not

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consider an operating lease to be a purchase. Please consult your accountant
for the exact application for your business.

100% Financing – Leasing typically does not require a large down payment and
you can finance up to 100% of the equipment cost. In many cases service,
supplies, installation, warranty and other soft costs can be included in the
lease. This gives you more money to invest in other revenue-generating
activities and makes it easier to afford multiple products or just save it
for times when you need cash most.

Speed – In most cases, up to $250,000 in equipment lease financing can be
approved with a one page credit application. Approval can usually be secured
in less than 24 hours.

Preserve Cash and Bank Lines – Preserve cash and bank lines by using
equipment leasing as an alternative form of financing specifically for
capital equipment. Use this financing option to maximize liquidity and
access to capital by preserving cash and bank lines for other business needs.

Strengthen Company Credit – Most of the Financing lines are tied to the
business and will not be reflected as leverage on the lessee’s/owner’s
personal credit report. As an alternate result, the financing lines will
build-up and strengthen your business credit as we report the positive pay
history you establish.

However, please note that each leasing situation is different, just as every
business enterprise is different.

Equipment Financing

How does Equipment Financing Work

When you need business equipment, getting a small business equipment loan
could be a smart financial move. You can use these loans to purchase
virtually any type of business equipment, but how much you can borrow depends
on the type of equipment you’re buying and whether the equipment is new or
used.

If you’ve ever had a car loan, you already have a basic idea of how an
equipment loan works. The equipment serves as collateral to secure your loan,
so you probably won’t have to put up additional collateral. Most equipment
loans are usually made at fixed interest rates – usually between 8% and 30% –

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and offer a fixed term length so that your monthly payments are always the
same.
How long you can extend the term of the loan depends on the nature of the
equipment and its expected life. Few lenders would be willing to extend the
term of an equipment loan beyond the expected useful life of the equipment
itself.
For some business owners choosing to lease equipment instead of getting an
actual loan is a more viable option. There may be advantages to leasing, but
with an equipment loan, you own the equipment after the loan is paid off.
With a lease, you don’t own the equipment once the lease term is over.

Cost

The thing to keep in mind with equipment financing is that it prevents the
business owner from having to pay the entire cost of the equipment upfront.
Although they will have to pay more to finance the equipment, they will be
able to spread out the cost over an extended period of time. Let’s say you
have a piece of equipment you would like to purchase that costs $10,000. An
equipment financing company offers to upfront you the cash to purchase that
piece of equipment but will charge you 12% interest to do so. As well, the
lender has requested you pay back the loan in 3 years (or 36 months). With a
12% APR, this means that this $10,000 piece of equipment will actually cost
you $11,957.15 ($1,957.15 in financing fees). The monthly payments would be
$332.14.

Who Qualifies

Most businesses can qualify for equipment financing. How much they qualify
for – and the interest rate they’ll pay – depends on the value of the
equipment, the business history, and their credit rating.
Equipment financing can be a great option if one’s credit rating is less than
perfect, as the equipment collateralizes the loan.
Large Dollar Amount Financing –Lease Lines of Credit

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Middle Market Transactions – For larger dollar figure acquisitions they are
worth pursuing as the payout can be quite rewarding. Some of the specific
programs are:

 Master lease lines of credit and operating leases
 Transaction size – $150,000 – $50,000,000
 Term length – 24-84 months
 Off balance sheet financing
 Buy outs – Fair Market Value, $1, 10%, 20%, larger balloons
 Payment types – Monthly, Quarterly, Seasonal, Cash Flow Based
 Structures – Master Lease Lines, Operating Lease, Refinances
 Equipment types – Most new or used business equipment, furniture,

vehicles, software, etc.
Application Requirements:

 Application Requirements – Full financial package
 Documentation – Varies based on financial product
Regardless of the best-laid plans, businesses often have to move quickly. A
One-Page Application shows to your potential client how expeditious we look
to facilitate their transaction.

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International Trade Finance, $ 9+ Trillion Industry

Trade Finance, $9+ Trillion Industry

Trade finance is used when financing is required by buyers and sellers to
assist them with the trade cycle funding gap. Buyers and sellers can also
choose to use trade finance as a form of risk mitigation. For this to be
effective the financier requires:

 Control of the use of funds, control of the goods and the source
of repayment

 Visibility and monitoring over the trade cycle through the
transaction

 Security over the goods and receivables
Trade finance helps settle the conflicting needs of the exporter and the
importer. An exporter needs to mitigate the payment risk from the importer
and it would be in their benefit to accelerate the receivables. On the other
hand the importer wants to mitigate the supply risk from the exporter and it

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would be in their benefit to receive extended credit on their payment. The
function of trade finance is to act as a third-party to remove the payment
risk and the supply risk, whilst providing the exporter with accelerated
receivables and the importer with extended credit.

Letters of Credit

Letters of credit (LCs) are one of the most secure instruments available to
international traders. An LC is a commitment by a bank on behalf of the buyer
that payment will be made to the beneficiary (exporter) provided that the
terms and conditions stated in the LC have been met, consisting of the
presentation of specified documents. The buyer pays his bank to render this
service. An LC is useful when reliable credit information about a foreign
buyer is difficult to obtain, but the exporter is satisfied with the
creditworthiness of the buyer’s foreign bank. This method also protects the
buyer since the documents required to trigger payment provide evidence that
the goods have been shipped or delivered as promised. However, because LCs
have many opportunities for discrepancies, documents should be prepared by
well-trained professionals or outsourced. Discrepant documents, literally not
having an “i dotted and t crossed,” can negate the bank’s payment obligation.

Characteristics of A letter of credit Applicability Recommended for use in
new or less-established trade relationships when the exporter is satisfied
with the creditworthiness of the buyer’s bank.Risk is evenly spread between
seller and buyer, provided that all terms and conditions are adhered to.

Pros • Payment made after shipment
• A variety of payment, financing, and risk mitigation options available

Cons • Complex and labor-intensive process
• Relatively expensive method in terms of transaction costs Key Points
• An LC, also referred to as a documentary credit, is a contractual
agreement whereby the issuing bank (importer’s bank), acting on behalf
of its customer (the buyer or importer), authorizes the nominated bank

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(exporter’s bank), to make payment to the beneficiary or exporter
against the receipt of stipulated documents.

• The LC is a separate contract from the sales contract on which it is
based; therefore, the bank is not concerned whether each party fulfills
the terms of the sales contract.

• The bank’s obligation to pay is solely conditioned upon the seller’s
compliance with the terms and conditions of the LC. In LC transactions,
banks deal in documents only, not goods.

• LCs can be arranged easily for one-time deals.

• Unless the conditions of the LC state otherwise, it is always
irrevocable, which means the document may not be changed or cancelled
unless the seller agrees. Confirmed Letter of Credit A greater degree
of protection is afforded to the exporter when an LC issued by a
foreign bank (the importer’s issuing bank) is confirmed by a U.S. bank
and the exporter asks its customer to have the issuing bank authorize a
bank in the exporter’s country to confirm (the advising bank, which
then becomes the confirming bank). This confirmation means that the
U.S. bank adds its engagement to pay the exporter to that of the
foreign bank. If an LC is not confirmed, the exporter is subject to the
payment risk of the foreign

Requirements

 Issued on behalf of buyer in international transaction by buyers bank.
 Buyer must have an approved credit line for amount of transaction of

equal cash deposited in bank account.
 Need the following documentation: Pro-Forma Invoice, Letter of Credit,

Commercial Invoice, Bill of Lading, Packing lists and Draft.

Purchase Order Financing

What is Purchase Order Financing?

Get cash for your business

Purchase order financing is a funding option for businesses that need cash to
fill single or multiple customer orders. In many businesses cash flow
problems exist. There will be times where there is simply not enough money
available to cover the costs of doing business. As a result, there may be an

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order from a client that isn’t able to be fulfilled due to a lack of cash. A
company may not be able to afford the supplies necessary to meet the client’s
particular needs. Having to turn the order down would obviously mean loss of
revenue and perhaps even a tarnished reputation.

If word gets around that a company is turning away business because they
can’t afford to complete jobs, customer trust is diminished. Groups that
considered giving that company their business will likely think twice.
Therefore, to avoid such scenarios, it is imperative that businesses find the
money that they need. For some companies, purchase order financing is a great
way to go.

Purchase order financing involves one company paying the supplier of another
company, for goods that have been ordered to fulfill a job for a customer.
This is an advance and may not be for the entire amount of the supplies, but
it will cover a large portion of it. In some cases, companies can qualify for
100% financing. The purchase order finance company will then collect the
invoice from the end customer. The purchase order finance company makes their
money by charging the company in need of funds various fees. These fees are
taken out of the collected invoice. The remaining amount is returned to the
company.

A second option is for the purchase order financing company to open up a line
of credit with the supplier. The line of credit will be opened in their name
and backed by them. This allows businesses with poor credit or few assets to
get the supplies that they need.

Purchase order financing can be quite advantageous. It is pretty easy to
qualify for and much easier than bank financing. Also, it does not require a
company to have stellar credit. What is important is the creditworthiness of
the client who has created the purchase order. If this person has a strong
credit history, then purchase order financing is pretty easy. Many companies
will require that the client be a commercial one or a government agency.
There might also be other requirements. For example, the company may need to
be profitable or earn so much in sales each month. The requirements will
likely differ based on the financier.

Unlike bank financing lenders, purchase order financing hinges mostly on the
financial strength and creditworthiness of the company who has placed an
order with a particular business, and not on the business itself. This makes
it a viable option for new businesses and those with average credit.

Purchase Order Financing – How It Works & Benefits

Purchase order financing is an effective form of business financing in which
money is advanced against a purchase order for finished goods or value added
products to finance the manufacturing of the item.

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Factoring

Factoring is a form of asset-based financing and is the process of selling
commercial accounts receivables by a business in order to obtain immediate
cash payment of the accounts before their actual due date.

Factoring differs from borrowing in that the accounts receivables are
actually sold rather than merely offered as collateral. The net result is
that the company can convert its receivables into immediate operating cash so
that they will not have to wait 30, 60 and 90 days or more for their
customers to pay.

This process places the time, cost, and effort of collection into the hands
of a funding company, allowing the proprietor the time to concentrate on what
they do best – run the company. The company receives the cash it needs, when
it needs it, so that the owner may best manage the business.

Factoring can be a great option for companies that need money quickly, but
who aren’t able to secure a conventional, bank loan. Factoring is known by
other names. Receivables factoring, invoice discounting, invoice factoring
and debtor financing are other commonly used names.

Factoring benefits both companies. The seller gets the capital that they want
or need and the factor is able to make money by charging the seller a
discount fee on the invoice.

A good factoring company will research the credit history of the seller’s
customers prior to purchasing the invoices. They will want to be confident
that these companies have a history of paying their bills.

Factoring is a way for companies to infuse cash into their business without
taking on additional debt. By selling their accounts receivables at a
discount, they can get money right away without having to wait to collect it
themselves. In exchange, the factor, is able to make money on the invoices by
charging the company a discount fee for their services. One company gets the
money they need to continue operating and/or grow their business, while
another one has the opportunity to make money by helping businesses grow and
prosper.

Money fuels business. When cash flow stalls, it compromises the ability to
run the company effectively. Most business owners and operators agree that if
they could get paid today on work already completed, it would drive their
business success forward. A financier then comes in and provides this needed
cash flow which is referred to as, factoring. Companies can receive up to 92%
of the invoice amount immediately, and gives the remaining balance when their
clients settle in full. Invoices can be submitted for factoring directly

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upon completion of work or product delivery. Revenue flows directly and
instantly to the business. No delays. No collection hassles. The factoring
company often assume all credit risk and responsibility for client payment.
In return, the Factoring Company is paid a small fee at the end of the
process. Set-up time can be as little as 2 or 3 business days and the
business is not tied into a long-term contract. In factoring the client’s
ability to pay, and not the credit of their growing business is the main
determinate.

Forfaiting

Forfaiting is a method of trade finance that allows exporters to obtain cash
by selling their medium and long-term foreign accounts receivable at a
discount on a “without recourse” basis. A forfaiter is a specialized finance
firm or a department in a bank that performs non-recourse export financing
through the purchase of medium and long-term trade receivables. “Without
recourse” or “non-recourse” means that the forfaiter assumes and accepts the
risk of non-payment. Similar to factoring, forfaiting virtually eliminates
the risk of non-payment, once the goods have been delivered to the foreign
buyer in accordance with the terms of sale. However, unlike factors,
forfaiters typically work with exporters who sell capital goods and
commodities, or engage in large projects and therefore need to offer extended
credit periods from 180 days to seven years or more. In forfaiting,
receivables are normally guaranteed by the importer’s bank, which allows the
exporter to take the transaction off the balance sheet to enhance key
financial ratios. The current minimum transaction size for forfaiting is
$100,000. In the United States, most users of forfaiting are large
established corporations, but small and medium-size companies are slowly
embracing forfaiting as they become more aggressive in seeking financing
solutions for exports to countries considered high risk.

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The Varied Aspects of Forfaiting

Applicability-Suited for exports of capital goods, commodities, and large

projects on medium and long-term credit (180 days to seven years or more).

Risks-Risk of non-payment inherent in an export sale is virtually eliminated.

Pros-Eliminates the risk of non-payment by foreign buyers

Offers strong capabilities in emerging and developing markets

Cons-Cost is often higher than commercial lender financing

Limited to medium and long-term transactions and those exceeding
$100,000

Key Points

 Forfaiting eliminates virtually all risk to the exporter, with 100
percent financing of contract value.

 Exporters can offer medium and long-term financing in markets where the
credit risk would otherwise be too high.

 Forfaiting generally works with bills of exchange, promissory notes, or
a letter of credit.

 In most cases, the foreign buyers must provide a bank guarantee in the
form of an aval, letter of guarantee or letter of credit.

 Financing can be arranged on a one-shot basis in any of the major
currencies, usually at a fixed interest rate, but a floating rate
option is also available.

 Forfaiting can be used in conjunction with officially supported credits
backed by export credit agencies such as the U.S. Export-Import Bank.

How Forfaiting Works

The exporter approaches a forfaiter before finalizing the transaction’s
structure. Once the forfaiter commits to the deal and sets the discount rate,
the exporter can incorporate the discount into the selling price. The
exporter then accepts a commitment issued by the forfaiter, signs the
contract with the importer, and obtains, if required, a guarantee from the
importer’s bank that provides the documents required to complete the
forfaiting. The exporter delivers the goods to the importer and delivers the
documents to the forfaiter who verifies them and pays for them as agreed in
the commitment. Since this payment is without recourse, the exporter has no
further interest in the financial aspects of the transaction and it is the
forfaiter who must collect the future payments due from the importer.

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When to Contact a Forfaiter

Forfaiting is widely used by exporters and financial institutions throughout
Europe because their sales and financing professionals work very closely
together to develop a contract price proposal that makes the cost of
financing competitive and attractive to foreign buyers, an approach not
widely embraced and practiced in the United States. Thus, exporters should
contact a forfaiter at the earliest possible point in formulating their sales
and financing proposals so that they might better understand the subtleties
and complexities of dealing in certain markets, including how to create a
medium-term financing proposal at interest rates that are competitive,
without reducing the margin on the sale.

Cost of Forfaiting

The cost of forfaiting to the exporter is determined by the rate of discount
based on the aggregate of the LIBOR (London inter-bank offered rate) rates
for the tenor of the receivables and a margin reflecting the risk being sold.
In addition, there are certain costs that are borne by the importer that the
exporter should also take into consideration. The degree of risk varies based
on the importing country, the length of the loan, the currency of the
transaction, and the repayment structure–the higher the risk, the higher the
margin and therefore the discount rate. However, forfaiting can be more cost-
effective than traditional trade finance tools because of the many attractive
benefits it offers to the exporter.

Major Advantages of Forfaiting

Volume: Forfaiting can work on a one-off transaction basis, without requiring
an ongoing volume of business.

Speed: Commitments can be issued within hours or days depending on details
and country.

Simplicity: Documentation is usually simple, concise, and straightforward.

Forfaiting Industry Profile

Forfaiting was developed in Switzerland in the 1950s to fill the gap between
the exporter of capital goods, who would not or could not deal on open
account, and the importer, who desired to defer payment until the capital
equipment could begin to pay for itself. Although the number of forfaiting

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transactions is growing worldwide, there are currently no official statistics
available on the size of the global forfaiting market. However, industry
sources estimate that the total annual volume of new forfaiting transactions
is around $30 billion and that forfaiting transactions worth $60 to $75
billion are outstanding at any given time. Industry sources also estimate
that only 2 percent of world trade is financed through forfaiting. U.S.
forfaiting transactions account for only 3 percent of that volume.Forfaiting
firms have opened around the world, but the Europeans maintain a hold on the
market, including in North America. Although these firms remain few in number
in the United States, the innovative financing they provide should not be
overlooked as a viable means of export finance for U.S. exporters.

Escrow Global Trade

As an exporter, the business proprietor want to know that they’ll be paid on
time and in full; and as an importer, he/she wants to ensure they’ll receive
the goods on time and to the required quality.

Escrow services offer peace of mind to both transacting parties by
safeguarding funds in an escrow account until the pre-agreed conditions of
the escrow contract are met. An escrow agreement assures the seller that the
buyer has the ability to pay for the goods, and they assure the buyer that
they will only have to pay for the goods once they are received in the
condition described by the seller.

Merchant Terminals & Payment Solutions

This allows a business to accept the widest range of payment solutions
possible. This allows the merchant to accept payments such as checks, debit
and credit cards of all forms and e-payment software solutions

Also called “Retail Management System” this software is no longer just about
processing sales but comes with many other capabilities such as inventory
management, membership system, supplier record, bookkeeping, issuing of
purchase orders, quotations and stock transfers, barcode label creation, sale
reporting and in some cases remote outlets networking or linkage, to name
some major ones.

Nevertheless it is the term POS system rather than Retail Management System
that is in vogue among both end-users and vendors.

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We offer a range of payment solutions in the most technological advance
forms.

Product Range + Mobile Performance and
Reliability
Processing transactions reliably
and securely + Internet Protocol (IP) Platform
Internet based platforms
Ecommerce capabilities + Available and Monitored 24x7
Security payment Validation
software + Authorizations in Less Than Three
Merchant Compatibility Seconds
+ Web
+ Handles Millions of Transactions
+ Retail
+ Mail Order/Telephone(MOTO) + Geodistant Redundant Data
Centers

Check payment acceptance

ECheck conversion systems with
guarantees

Commercial Real Estate Finance

Mezzanine Loans

Mezzanine loans are similar to second mortgages, except a mezzanine loan is
secured by the stock of the company that owns the property, as opposed to the
real estate. If the company (usually a LLC) fails to make the payments, the
mezzanine lender can foreclose on the stock in a matter of a few weeks, as
opposed to the 18 months it often takes to foreclose a mortgage in many
states. If you own the company that owns the property, you control the
property.

A hard money company has a more challenging time foreclosing on a hard money
loan that has been defaulted on than it does mezzanine loan usually based on
state laws, In contrast, a mezzanine loan is secured by the stock of a
company, which is personal property and can be seized much faster.

Mezzanine loans are also fairly big. It is hard to find a mezzanine lender
who will slug through all of the required paperwork for a loan of less than

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$2 million. It is occasionally possible to obtain mezzanine loans as small
as $1 million. In addition, mezzanine lenders typically want big projects.
If the commercial property owner is seeking financing on real estate worth
$10 million or under, they may have a challenging time attracting the
interest of any mezzanine lenders.

There are three typical uses for a mezzanine loan. Suppose the owner of a
$10 million shopping center has a $5 million first mortgage from a conduit.
The owner wants to pull out some equity, but he cannot simply refinance the
shopping center because the first mortgage has either a lock-out clause or a
huge defeasance prepayment penalty. In this instance, he could probably
obtain a $2.5 million mezzanine loan to free up some cash.

Suppose an experienced office building investor wanted to buy a partially-
vacant office building in a fine location. Once again, assume that the
purchase price is $10 million (when the office building is still partially-
vacant) and that the conduit first mortgage is $5 million.

This may surprise you, but the right mezzanine lender might be willing to
lend a whopping $4 million! But isn't that 90% loan-to-value? Yes, but when
the vacant space is rented - remember, our buyer is a pro - the property will
increase to $12 million in value. Suddenly the mezzanine lender is back to
75% loan-to-value and his rationale is obvious. This kind of deal is called
a value-added deal.

The third and final use of mezzanine loans is for new construction. Suppose
a developer wanted to build a 400 room hotel across the street from
Disneyland. Hotels today are out of favor, and a commercial construction
lender might only be willing to make a loan of 60% loan-to-cost. If the
total cost was $20 million, the developer would ordinarily have to come up
with 40% of $20 million or $8 million. That's a lot of dough.

A $3 million mezzanine loan solves the developer's problem. The commercial
construction lender would advance $12 million, the mezzanine lender would
make a $3 million mezzanine loan, and the developer would "only" have to come
up with $5 million.

Hard Money Loans

Commercial hard money loans are based on real estate value, so factors like
the investor’s income or credit history don’t affect eligibility for funding.
In addition the possibilities exist for those investors seeking loans for
emergency cash-outs and non-bankable transactions.

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Terms

• ARV: Up to 70% of the ARV of the property (see the note below)
• Length of Term: 6 Month Balloon Note (longer on case-by-case basis)
• Payments: Monthly interest only payments usually required
• Fees: No application fees
• Points: Points vary depending on the loan.
• Rates: We charge rates based on the market and project but are
• Closing: Usually within 5 - 14 days of approval
• Commitment: Same day or next day if all requirements are met in

application
• Draws: Flexible draw schedules for renovation money
• No prepayment penalty
• No second mortgages: We only lend in the first position.
• Amounts: From $200,000 to $5,000,000
• No Personal Information: No employment verification, proof of funds

Markets

Nationally and Canada and International

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Construction loans

Construction Loans are
not easy to procure as
traditional mortgages.
The terms, rates and
fees may differ widely.
A Construction Loan is
generally a short-term
and interest only loan.
Such a HOME CONSTRUCTION
LOAN is usually replaced
by a regular mortgage on
completion of construction.

New Home Construction Loans

The greatest advantage with this type of Construction Loan is that
application and processing fees are reduced.

Construction-To-Permanent Loans

In this case, the lender automatically modifies the Construction Loan into a
mortgage after construction is complete. The Commercial real estate borrower
deals with just one lender, fills out one loan application, and pays only one
set of closing costs. But the investor also agrees to the mortgage rate and
terms before construction is complete. There's no chance to shop around for a
new lender after the house is finished.

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Commercial Construction Loans

A loan given to a business for the purpose of constructing a building or
improving existing real estate already owned by the company. Commercial
Construction Loans are very large and long term loans that are difficult to
obtain. However, we at Monarch Capital can facilitate such loans providing
all the requirements are met.

Construction Land Loans

A Construction Loan finances the land, land improvements (such as clearing,
grading, utilities, driveway, etc.), actual construction costs, finishes in
the home (such as carpeting, appliances, etc.), architects and engineer's
fees, permit fees, interest payments on the Construction Loan while the home
is under construction (so investor can have payments deferred if they so
wish) and closing costs on the transaction.

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Business Construction Loans

Construction Loans for a business are a little harder to obtain than
RESIDENTIAL CONSTRUCTION LOANS. Certain banks prefer specific types of
property for lending money, and the terms for Construction Loans are
generally much shorter than with a mortgage. In addition, business
construction loans take much more into consideration than just credit history
- factors such as the industry of the building company, how profitable it is,
how long the business owner has owned the company, and their business
experience or entrepreneurship will be some of the deciding factors as well.
On the other hand you we might be able to present such deals to some of our
private investors who carry an appetite for such deals and can provide much
easier terms for on such loan requests.

Construction Hard Money Loans

Creative lending solutions are needed for borrower’s who have low credit
scores, low income, no cash flow or are in need of a quick closing! Hard
Money Loan can finance single family residence - residential construction
loan, unimproved & improved property of all types - hard money construction
loans including land purchases, developer lots or raw land.

Owner Builder Construction Loans

This is financing is best suited for the owner builder. The program include,
conventional, kit or log home construction financing, and allows the builder
to self-build a home for investment purposes, it is the easiest, most
flexible Construction Loan available whether building a home for investment,
rental or resale.

Real Estate Owned (REO)

Real estate owned (REO) properties are foreclosures that a lender has
unsuccessfully attempted to sell at auction and are still available for
purchase. Those properties are often priced much lower than market value, and
are good bargains for people in the commercial real estate industry who are
willing to take advantage of overlooked opportunities that require a quick
closing.

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