Fueling the Entrepreneurial Spirit

Funding the American Dream

Current Loan Programs:

Borrego Express Capital Loan Programs utilize 2 SBA Loan

Products:

Patriot Express Loan Program

Community Express Loan Program

COMMUNITY EXPRESS

BORREGO EXPRESS CAPITAL LOAN PROGRAM

BORREGO SPRINGS BANK, N. A.

LOAN AMOUNTS: $5,000 - $50,000

COLLATERAL: Unsecured

INTEREST RATES:

$5,000 - $25,000 – WSJ PRIME + 4.75%

$26,000 - $50,000 – WSJ PRIME + 3.75%

VARIABLE RATE ADJUSTING CALENDAR QUARTERLY

TERM: 7 YEARS - FULLY AMORTIZING

NO PREPAYMENT PENALITY : 21 DAY PAYOFF NOTIFICATION

COMMUNITY EXPRESS

WHO IS ELIGIBLE?

COMMUNITY EXPRESS: (EFFECTIVE OCTOBER 1, 2008)

All SBA ELIGIBLE BUSINESSES $5,000 - $25,000

$26,000 - $50,000 BUSINESSES LOCATED IN LMI ‘S AND

HUB ZONES

ELIGIBILITY CONTINUED

PATRIOT EXPRESS PROGRAM: ($5,000 - $50,000) (51% OWNED AND OPERATED)

VETERAN OWNED, ACTIVE DUTY MILITARY PARTICIPATING IN THE MILITARY’S TRANSITION ASSISTANCE PROGRAM (TAP), or ACTIVE DUTY WITHIN ONE YEAR OF SEPERATION, ACTIVE RESERVISTS OR NATIONAL GUARD MEMBER, OR A SPOUSE OF ANY OF THESE GROUPS , OR A WIDOWED SPOUSE OF A SERVICE MEMBER OR VETERAN WHO DIED OF SERVICE-CONNECTED DISABILITY

COMMUNITY EXPRESS

LOAN COST

$425 – PACKAGING FEE – DEDUCTED FROM LOAN PROCEEDS

2% SBA GUARANTY FEE ON GUARANTEED PORTION (85%) DEDUCTED FROM LOAN PROCEEDS

LOAN PAYMENTS – AUTO DRAFT FROM BUSINESS CHECKING ACCOUNT AT YOUR LOCAL FINANCIAL INSTITUTION

COMMUNITY EXPRESS

TECHNICAL ASSISTANCE REQUIREMENT

PRE AND POST CLOSING FOR ONE (1) YEAR FROM FUNDING

WHAT IS TECHNICAL ASSISTANCE?

BUSINESS PLAN – REQUIRED FOR ALL LOANS PRIOR TO FUNDING

ACCOUNTING , MARKETING, INVENTORY CONTROL, SALES TRAINING, P.O.S. TRAINING …

SBA APPROVED TECHNICAL ASSISTANCE PROVIDER

COMMUNITY EXPRESS

BUSINESS PLANS

THE BLUEPRINTS FOR BUILDING

YOUR BUSINESS

BUSINESS SUMMARY, MANAGEMENT RESUME AND ANALYSIS, MARKET IDENTIFICATION AND FINANCIAL PROJECTIONS

2 YEAR BREAKOUT OF INCOME AND EXPENSES TO INCLUDE OWNERS SALARY

STARTUP AND/OR NEW PROJECT COSTS

BALANCE SHEET AND CASH FLOW ANALYSIS INCLUDING LOAN PROCEEDS AND EQUITY INJECTION

COMMUNITY EXPRESS

INITIAL CREDIT APPROVAL

PERSONAL FINANCIAL STATEMENTS ARE REQUIRED

INCOME VERIFIED WITH TAX RETURN TRANSCRIPT (4506)

UTILIZING FAIR ISAAC SMALL BUSINESS CREDIT SCORING MODEL FOR FAST EFFICENT CREDIT APPROVAL

EVALUATES THE CREDIT HISTORY OF THE BORROWER ALONG WITH INDUSTRY DATA ON THE BUSINESS

CURRENT AND RECENT PAST DUE ACCOUNTS, COLLECTIONS, JUDGEMENTS, LIENS AND BANKRUPTCY HAVE VERY NEGATIVE AFFECT ON SCORE

COMMUNITY EXPRESS

ELIGIBILITY ISSUES

START-UP BUSINESSES ARE ALLOWED

LOAN PROCEEDS FOR BUSINESS ACQUISITION NOT ALLOWED

FRANCHISE MUST BE ON SBA APPROVED FRANCHISE LIST

www.franchiseregistry.com

LIQUID ASSETS OF INDIVIDUAL OWNER CAN NOT EXCEED $100,000

COMMUNITY EXPRESS

INELIGIBLE BUSINESSES

NOT FOR PROFIT BUSINESS

INVESTMENT REAL ESTATE – APARTMENTS, RENTAL HOUSING OR MULTI-TENANT BUILDINGS

SPECULATIVE REAL ESTATE LOANS OR BUSINESSES

AGRICULTURAL AND FARM BUSINESSES (GROWING CROPS OR ANIMALS)

FISHING AND SHORE OPERATIONS

MEDICAL FACILITIES (INCLUDING NURSING HOMES AND ALF’S)

COMMUNITY EXPRESS

INELIGIBLE BUSINESSES CONTINUED

MINING OPERATIONS (INCLUDING SAND AND GRAVEL PITS)

LOANS FUNDS TO OPERATE OR ESTABLISH OPERATIONS IN A FOREIGN COUNTRY

BUSINESSES ENGAGED IN TEACHING, INSTRUCTING, COUNSELING OR INDOCTRINATING RELIGION OR RELIGIOUS BELIEFS, WHETHER IN A RELIGIOUS OR SECULAR SETTING

A BUSINESS WITH ANY PRODUCTS OR SERVICES OF A SEXUAL NATURE

COMMUNITY EXPRESS

INELIGIBLE BUSINESSES CONTINUED

BUSINESSES THAT IS ENGAGED IN LENDING BANKS ARE NOT ELIGIBLEMORTGAGE BROKERS ARE OKMORTGAGE BANKER IS NOTPAWN SHOP – DEPENDS ON INCOME SOURCE

BUSINESSES THAT ARE ENGAGED IN GAMBLING

BUSINESSES ENGAGED IN PYRAMID SALES AND DISTRIBUTION

COMMUNITY EXPRESS

INELIGIBLE BUSINESSES CONTINUED

A BUSINESS THAT RESTRICTS PATRONAGE

CONSUMER AND MARKETING COOPERATIVES

A BUSINESS ENGAGED IN LOBBYING ACTIVITIES (50%)

INSURANCE COMPANIES

SBA LOAN PACKAGERS

A BUSINESS OR BORROWER THAT HAS A PRIOR LOSS TO THE GOVERNMENT

COMMUNITY EXPRESS

APPLICATION PROCESS

PREFERRED METHOD IS THROUGH A TA PROVIDER, PARTICIPATING BANK PARTNER, OR DIRECT FROM BORROWER

UPON INITIAL CREDIT REVIEW (FAIR ISAAC SMALL BUSINESS CREDIT SCORE), PROCESSING / UNDERWRITING CHECKLIST IS ISSUED TO BORROWER AND/OR THE TA PROVIDER

Y

UNDERWRITING PROCESS

ALL PROGRAMS:

REVIEW OF THE BUSINESS PLAN AND PROJECTIONS

(DOES IT MAKE SENCE? IS IT REALISTIC?)

VERIFICATION OF INFORMATION SUBMITTED

(TIME IN BUSINESS, HOUSEHOLD INCOME (4506), OWNERSHIP OF THE BUSINESS,

REVIEW OF LEASE AND BUSINESS FORMATION DOCUMENTS)

COMMUNITY EXPRESS

CLOSING PROCESS

COMMITMENT LETTER AND CLOSING DOCUMENTS ARE ISSUED ONCE ALL CHECKLIST ITEMS ARE RECEIVED, REVIEWED, AND APPROVED BY UNDERWRITING, (INCLUDING THE BUSINESS PLAN AND TA CERTIFICATE)

FUNDING THEN OCCURS AFTER RECEIPT AND REVIEW OF EXECUTED LOAN DOCUMENTS

NOTE: IF LOAN DOCUMENTS REQUIRE ANY CHANGES, CONTACT THE CLOSER IMMEDIATELY

Program Updates

Community Express

Patriot Express

Community Express Loan Program

The community express loan program will expire on April 30, 2011.

We will stop taking applications for the Community Express loan Program on

April 1, 2011

Patriot Express Loan Program

The Patriot Express Loan program has been extended for another 3 years by the SBA.

Potential New Products

We are currently evaluating the potential of the new Small Loan Advantage Program as well as the feasibility of the 7(a) program to deliver small dollar loans to businesses across the US.

COMMUNITY EXPRESS

QUESTIONS?

THANKS FOR YOUR INTEREST IN OUR

LOAN PROGRAMS