# Presentation: 906040

## US Ex-IM Bank Financing ProposalforCapital Goods Imports from the US

**A Division of The Toronto-Dominion Bank**

**April, 2006**
**ISRAEL**

**US Ex-IM Bank Financing Proposal****for****Capital Goods Imports from the US**

## Table of Contents

- 1	TD Bank Financial Group
- 2   US Ex-Im Bank Financing
- 3    Appendix 1 - TDBFG Key Financials
- 4   Contact Details

- 4
- 9
- 23
- 27

**Your attention is directed to the disclosure warning on the last page of this document**

## TD Bank Financial Group

## Overview

**Overview**

- Founded in 1855 and headquartered in Toronto, Canada with over 52,000 employees globally, The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Financial Group
- TD Bank Financial Group offers a full range of financial products and services to over 14 million customers in Canada and around the world. TD Bank Financial Group ranks among the top 10 banks in North America
- TD Bank Financial Group’s long-term debt is rated Aa3 by Moody’s Investor Service Inc. and A+ by Standard & Poor’s
- The Toronto-Dominion Bank trades on the Toronto and New York stock exchanges under the symbol “TD”
- TD Bank Financial Group is organised into three businesses, each of which contributes to its overall success:
**TD Securities,** the wholesale banking division of TD Bank Financial Group, is a leader in delivering corporate, government and institutional clients with innovative financial solutions
**TD Canada Trust**, a leader in personal and commercial banking in Canada
**TD Wealth Management**, including TD Waterhouse, one of Canada’s largest asset managers, advisors and distributors of investment products and mutual funds

## Operations in Asia

**Extensive experience in Asia/Pacific region; TD has been operating in the region for over 30 years**
**Currently TD has offices and personnel in Tokyo, Seoul, Hong Kong, Singapore and Sydney**
**Over 150 people are based in the region**
**Major product focus in the Asia/Pacific region is:**
**Trade Finance**
**Financial Institutions**
**Treasury**
**Debt Capital Markets**
**ECA financing (US Ex-Im Bank programs)**

-   TD Bank Financial Group

## Structure

-   TD Bank Financial Group

**Toronto-Dominion Bank Financial Group**

**TD Waterhouse**

**Wealth Management & Investing**

**TD Asset Management**

- Discount Brokerage
- Financial Planning
- Investment Advice

- Private Asset Management
- Private Investment Counsel
- TD Harbour Capital
- TD Lancaster Investor Counsel
- TD Mutual Fund
- TD Quantitative  Capital

**TD Bank Financial Group is one of the largest Canadian financial institutions with total assets of over C$365 billion as at Oct 31/05, offering a full spectrum of financing capabilities. **

## Global Presence

**London**

**Tokyo**

**Hong Kong**

**Singapore**

**New York**

**Montreal**

**Toronto**

**Chicago**

**Calgary**

**Houston**

**Mexico City**

**Vancouver**

**Sydney**

**Dublin**

**Seoul**

**Baltimore**

**TD has a global presence through its network of offices with over 52,000 people globally.**

-   TD Bank Financial Group

- Amsterdam

## US Ex-Im Bank Financing

## US Ex-Im Bank

_**Description**_
**The Export-Import Bank of The United States (“US Ex-Im Bank”) is the official export credit agency of the US Government**
**Mission: Promote the export of US goods and services by providing guaranteed financing facilities through commercial banks such as TD Bank**

## Competitive financing for international buyers

**US Ex-Im Bank assists exporters by guaranteeing term financing to creditworthy international buyers, both private and public sector, for purchases of U.S. goods and services. With US Ex-Im Bank’s loan guarantee, international buyers are able to obtain competitive term financing from lenders when financing is otherwise not available or there are no economically viable interest rates on terms over one-to-two years.**
**Benefits:**
**Enables international buyers to obtain loans from lenders **
**Diversifies funding base for borrower**
***Flexible financing options and repayment terms **
**No limits on transaction size **
**Medium-term and long-term financing available** **for different projects **
**Environmental projects will get up to 15 year financing while medical equipment deal will get 7 year repayment terms**

## Typical features of US Ex-Im Bank Financing

**Medium to long term financing available to Buyers of US manufactured **_**capital equipment/services**_
**Offer different products for different purposes  (i.e. insured loans & guaranteed loans & CGFs etc)**
**Facility amount is typically in the range of US$500,000  to US$20,000,000 (no cap on upper limit)**
**Usual repayment term is **_**5 years**_** (can be extended up to 7 years in certain cases, i.e. environmental  and medical equipment)**
_**Unsecured**_** lending (no collateral on real estate)**
**Minimal restrictions/covenants in the loan agreement**
**Competitive pricing**
**Buyer (or Guarantor) must meet certain credit standards depending on nature and size of transaction**

***Product***
***Features***

## Eligible Goods and Financeable Value

**Goods must be shipped from US to the Buyer**
**Either produced/originated in the US or meet foreign content requirements (min 50% US content)**
**Financeable value is the **_**lesser of**_**:**
**	****	****i.    85% of the value of eligible goods/services and**
**	****	****ii. 100% of the US content of goods/services **
** ****Capital equipment and services, including:**
- Construction Equipment
- Oil drilling-related Equipment
- Design & Engineering Services
- Power Generation and Distribution Equipment
- Computer Systems
- Pollution Control, Waste Treatment, Environmental Equipment
**Medical Equipment (MRI, X-Ray, Ultrasound, etc.)**
- Other General Capital Equipment / Machinery

**Imports eligible for US Ex-Im Bank Financing generally include all capital equipments and services, except items relating to military / defence and those considered hazardous to the environment.**

## Application Requirements

**Audited financial statements for the last 3 years and the latest interim financial statements**
**Background of the company - ownership, management, operations and financials**
**Details of the import transaction including proforma invoices / purchase orders**
**Credit Reference from house bank with a lending relationship**
**Trade Reference**
**Credit Report from a Credit Agency like D&B, etc. (done by TD)**

**Information required for submitting the credit application to US Ex-Im Bank includes the following:**

## Initial Credit Standards

**Minimum 3 years in the same line of business**
**Positive operating profits/net income in the last 2 years**
**Positive cash from operations in the last fiscal year**
**Debt Service Coverage Ratio > 1.5x**
**Total Liabilities / Equity  < 1.75x**
**Facility Amount / Equity < 0.4x**
**In the case of new business, start up, etc. a corporate guarantor meeting the above financial standards is required**
**If borrower / guarantor meets above, we will go into detailed credit analysis (i.e. background, management, operations, competition etc)**

***Key Financial***
***Parameters***

**Key financial ratios required to be met are indicated below. **

*Transactions *_*WILL BE CONSIDERED*_* if some of the above ratios are not met provided that there are reasonable indications that the facility  can be repaid.*

## Transaction Steps

**Preliminary review of the Buyer’s financials and import transaction by TD**
**Letter of Intent to be signed between TD and the Corporate Entity buying the US Goods (the “Buyer”)**
**Good Faith Deposit and Submission of financial and other information for credit application**
**Credit Application to US Ex-Im Bank by TD**
**Approval from US Exim and regulatory approval (if necessary)**
**Execution of Credit Agreement **
**Funding (through Letter of Credit or Direct Disbursement)**
**Repayment of loan according to Credit Agreement**

**The application and approval process typically  takes 10-14 weeks.  **

## Sample Transaction

**	****Purchase Price of Equipment****	****	****	****US$****	****5,000,000**
**	****Importer’s Down-payment/Other Financing(15%)****	**_**US$**__**	**__**   750,000**_
**	****Financeable amount of Equipment****	****	****US$****	****4,250,000**
** ****Plus US Ex-Im Bank’s exposure fee (* 3.02%)****	****US$ ****	****   128,350**
** ****Total loan amount will be****	****	****	****US$****	****4,378,350**
**	*** (indicative subject to final US Ex-Im Bank’s analysis)
**Availability Period****	****	****	****	****6 months (can be extended up ****	****	****	****	****	****	****to 12 months)**
**	****Repayment Terms****	****	****	****	****5 Years (in 10 equal semi- annual ****	****	****	****	****	****	****installments of $437,835 principal****	****	****	****	****	****	****plus interest accrued)**
**	**

**Assuming 5 year financing for a US$5mm equipment imported from the US.**

-   US Ex-Im Bank Financing

## All in cost for 5 year term loan

|  |  |
| --- | --- |
| Bank Arrangement fee | 1.50% |
| LC Issuance | 0.25% |
| LC Nego/disbursement fee | 0.25% |
| EXIM Premium | 3.02% |
| Avg - 5 year | 1.00% |
| Interest applied | 1.00% |
| Total | 2.00% |
|  |  |
| All in Cost | 2.00% |
| Current Libor rate | 5.03% |
| Total all in cost | 7.03% |
| ** IF REQUESTED INTEREST RATE CAN BE FIXED |  |

## Why use TD

***Strong expertise and track record in raising US Ex-Im Bank financing****** ***

**Among the largest arrangers of US Ex-Im Bank financing globally in different sectors**
**Named “Bank of the Year 2004” by US Ex-Im Bank in April 2004**
**In 2005, TD secured approval for more than 55 US Ex-Im Bank transactions**
**Dedicated team in Singapore, Toronto, Baltimore and Houston to manage the process with US Ex-Im Bank**

-   US Ex-Im Bank Financing

## Selected US Ex-Im Bank Transactions

**2003**

- Export of Oncology Equipment for hospital expansion to Acibadem Saglik Hizmetleri A.S.
**Turkey**

**2004**

**US$2,715,913**

**2005**

**US$5,466,690**

- Export of Medical Equipment to
-  Florence Nightingale Hospital
-  **Turkey**

**2004**

**US$1,833,790**

**2004**

**US$1,043,090**

- Export of Surgical Equipment to
- Bionik Medikal Insaat
**Turkey**

**2005**

**Selected US Ex-Im Bank Transactions**

- Export of Pipelayers to
- Essar Constructions Ltd
**India**

- Export of Sugar Cane Harvesting and Processing Equipment to Cia. Agricola Industrial Santa Ana
**Guatemala**

**US$1,746,939**

- Multiple Suppliers Sales to
- Vidyut Metallics Private Limited
**India**

**2005**

**US$5,000,000**

- Export of Medical Equipment to Sema Egitim Ogretim Isletmeleri ve Saglik Hizmetleri A.S.,
**Turkey**

**2005**

**2005**

**Stryker**

## Slide 20

## Appendix 1 - TDBFG Financials

## Highlights

**Highlights**

-   TD Bank Financial Group

**(Millions of Canadian Dollars)****	****2005**
**Net Income – Operating Cash Basis****	****$2,583**
**Net Income – Reported Basis****	****$2,229**

**(Canadian Dollars)****	****2005**
**Diluted Earnings by Share – Operating****Cash Basis****	****$3.71**
**Diluted Earnings per Share – Reported****Basis****	****$3.20**
**Dividends per Share****	****$1.58**

**Net income (loss)**
- (millions of Canadian Dollars)

**Diluted Earnings and dividends per share**
- (Canadian Dollars)

## Highlights

-   TD Bank Financial Group

## Highlights

**Highlights**

-   TD Bank Financial Group

**Wholesale Banking Revenues Highlights**

**Revenues**
**(millions of Canadian Dollars)****	****2005****	****2004****	****2003**
- Corporate banking	$266	$303	$335
- Investment banking and capital markets	$1,467	$1,594	$1,552
- Equity Investments	$255	$299	$149
- Total	$1,988	$2,196	$2,036

## Contact Details

## Contact Details

_***TDB Singapore Branch***_
**1, Temasek Avenue**
**#15-02 Millenia Tower**
**Singapore 039192**

**Akhil  LAMBA****	**
**Singapore**
**65.6434.6070****	**
**akhil.lamba@tdsecurities.com**

**Sumit PALIWAL**
**Singapore**
**65.6434.6059**
**sumit.paliwal@tdsecurities.com**

**Siok Kheng CHUA**
**Singapore**
**65.6434.6012**
**siokkheng.chua@tdsecurities.com**

**Suha KOCABAL**
**Singapore**
**65.6434.6077**
**suha.kocabal@tdsecurities.com**

## Important Notice

**This report has been prepared solely for informational purposes only and is not intended to provide financial, legal, accounting or tax advice and should not be relied upon in that regard.  **
**Information provided in this report is believed to be accurate and reliable, but we cannot guarantee it is accurate or complete or current at all times and no representation is made in this regard.  Conclusions and opinions do not guarantee any future event or performance. **
**Neither The Toronto-Dominion Bank nor any of its subsidiaries or affiliates are liable for any errors or omissions in the information or for any loss or damage suffered.  **
**Copyright 2004 by The Toronto-Dominion Bank. "TD Securities" is a trademark of The Toronto-Dominion Bank, representing TD Securities Inc., TD Securities (USA) Inc., TD Securities Limited and certain investment activities of The Toronto-Dominion Bank.  **