2. UPS: A Single Source
Transportation and Global Freight Services
Comprehensive Logistics and Distribution Services
Financial Services - UPS Capital
Specialized Mail Services
Consulting Services
Package Delivery
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3. UPS Capital Overview
UPS Capital leverages the supply chain
expertise of UPS to develop financial solutions
that enable companies to operate more
effectively.
• Founded in 1998 as a financial services
subsidiary of UPS
• Staff of over 300 professionals
• Offices throughout the U.S. as well as
Canada, Hong Kong, China, Taiwan
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4. UPS Capital Capabilities
UPS Capital exists to help businesses like yours maximize the financial
resources invested in their supply chains. Our products and services
support your supply chain in three key areas:
Rely on UPS Capital Insurance
Agency, Inc. to mitigate the risks
Protect Your Goods inherent in today’s longer and
more complex supply chains.
Leverage the goods in your
supply chain to attain the capital
Improve Cash Flow you need to run and grow
your business.
Shorten the conversion of
Accelerate & goods to cash, while protecting
Protect Payments your business from customer
credit defaults.
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8. Merchant Services
Accelerate & Protect Payments
Provides credit card payment processing services
including processing for traditional credit cards, stored
value (gift) cards.
Plus, access e-commerce capabilities that make it easy
to build and maintain a thriving online presence:
Orbital® Payment Gateway – Process your transactions
in a secure internet-based environment, without the need
for specialized systems.
Instant Storefront™ – Create your own online store with
an all-inclusive e-commerce solution and integrated
processing through the Orbital Payment Gateway.
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9. Merchant Services
Benefits
No Monthly Minimums or Annual Fees
Expand Payment Options
• Your customers will appreciate expanded payment offerings including MasterCard®,
Visa®, American Express®, Discover®, Diners Club® and JCB® cards. Plus, you can
build repeat business and loyalty using our stored value card and gift card programs.
Get Started Quickly
• With a wide range of options for systems platforms, interfaces, terminals and
communication methods, we can deploy our services with little or no disruption to your
business and with fast merchant account set-up.
Improve Your Operations
• Our comprehensive reporting, expert chargeback and retrieval resolution, and 24/7
terminal support provide the insight and information you need to keep your business
running smoothly.
• Funds are securely and reliably transferred directly into your designated bank account.
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11. Credit Card Fraud Protection
Accelerate & Protect Payments
• UPS Capital has teamed up with CardinalCommerce®, a leader in
delivering payer authentication services, to offer fraud protection
services for your e-commerce credit card transactions.
• Verified by Visa® and MasterCard® SecureCode™ programs, quickly
and easily enabled through CardinalCommerce’s technology, offer
merchants the highest level of fraud protection available in the
eCommerce marketplace today.
All services in connection with the UPS Capital Credit Card Fraud Protection program are provided by CardinalCommerce and all fees charged for services are determined by
CardinalCommerce. All decisions regarding approval will be made solely by CardinalCommerce under CardinalCommerce’s then-current criteria.
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12. Credit Card Fraud Protection
Accelerate & Protect Payments
Credit Card Fraud Protection Services offers the following benefits to
merchants:
Grow globally. With our authentication services, you can process cards from all
over the world without the worry of fraud, giving you almost unlimited
possibilities for growth.
Reduce interchange rates. Fraud protection services help credit card providers,
too. Just like safe driver discounts from car insurance companies, payer
authentication can help reduce interchange rates, often by as much as 20 basis
points.
Eliminate fraud risk. Verified by Visa® and MasterCard® SecureCodeTM
programs save money by eliminating fraudulent online activity and chargebacks.
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14. Alternative Payments
Accelerate & Protect Payments
• Accept alternative payment options including:
PayPal™, Bill Me Later®, eBillme™, Google
Checkout, Amazon Payments™, Green Dot®,
MoneyPak®, ClickandBuy®, Ukash™, and
others.
• Adding these payment options will help to
expand your market by allowing customers more
choices, which can lead to more purchases and
fewer abandoned shopping carts.
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15. Accelerate & Protect Payments
Case Study
Retailer Grows Business, Expands Internationally with UPS Capital
• A U.S.-based jewelry retailer with approximately $5 million in annual
sales, was selling internationally, but they were experiencing heavy
losses in volume and sales due to fraud issues on international credit
card transactions.
• When the company switched to Credit Card Fraud Protection and
Merchant Services, offered through UPS Capital, its global expansion
strategy became a success.
• With the ability to accept up to 30 percent more transactions, the
company projected sales growth of $1 million per year. In addition, its
overall interchange rate decreased by 10 basis points, contributing to
significant annual savings for the company.
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17. C.O.D. Enhancement Services
Accelerate & Protect Payments
C.O.D. Enhancement Services* accelerate your payments with a
choice of options that can help your bottom line.
C.O.D. Automatic℠
• Receive C.O.D. payments within 3 business days of package
delivery.
• Funds are electronically deposited into your bank account
C.O.D. Secure®
• All the benefits of C.O.D. Automatic.
• Coverage for returned (NSF) C.O.D. checks.
* C.O.D. Enhancement Services products are offered through UPS Capital Trade Protection Services, Inc. UPS Capital Corporation and its affiliates reserve the right to change or cancel
the C.O.D. Enhancement Services program at any time. The C.O.D. Enhancement Services program is governed by the terms and conditions of the contract and certain limitations and
exclusions apply. This document does not in any way alter, supplement, or amend the provisions of the applicable contract and is intended only as a brief summary of the program. The
UPS C.O.D. charge as set forth in the UPS rates in effect at the time of shipping apply to each UPS C.O.D. package shipped. C.O.D. Enhancement Services products may not be
available in all jurisdictions. C.O.D. Secure is a registered trademark of, and C.O.D. Automatic and C.O.D. Direct are service marks of, United Parcel Service of America, Inc.
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18. C.O.D. Enhancement Services
Additional Features
Online Reporting
• Statements
• Check images
• Download of Remittance Data
Email/Fax Statements
• Daily Remittance Statements
• Activity Summary
Monthly Loss Reports (C.O.D. Secure®)
Real Time Fraud Prevention Reports (C.O.D. Secure®)
• Multiple Returned Items Report
Collection Agency Services (C.O.D. Secure®)
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19. C.O.D. Enhancement Services
Existing UPS C.O.D. Process
Day 1 UPS picks up checks and delivers package
Day 2-3 Checks delivered to UPS central processing center
Day 4-8 Checks mailed to shipper
Day 9-10 Checks received and processed by shipper’s accounting
department for deposit
Day 11-16 Shipper’s bank begins the check clearing process
Day 16 Funds available to shipper
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20. C.O.D. Enhancement Services
UPS Capital C.O.D. Enhancements Process
Day 1 UPS delivers package and collects C.O.D. funds.
C.O.D. funds delivered to central processing center and deposit
Day 2
prepared for UPS Capital’s bank account.
Funds transferred to the shipper’s bank account via Automated
Day 3-4 Clearing House (ACH). Funds available same or next business
day.
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22. Receivables Management Solutions
Accelerate & Protect Payments
UPS Capital can help free you from collections hassles and buyer credit risk:
• Trade Credit Insurance1
• Non-Funded Collection Factoring
• Receivables Financing – Factoring2
• Credit Intelligence2
• Credit Put Options2
• Collections Services2
1 Credit Insurance is offered through licensed insurance producers affiliated with UPS Capital Insurance Agency, Inc., and other affiliated insurance agencies. UPS Capital Insurance
Agency, Inc., and its licensed affiliates are wholly owned subsidiaries of UPS Capital Corporation. UPS Capital Insurance Agency, Inc., and its licensed affiliates reserve the right to
change or cancel the program at any time. The Credit Insurance program is governed by the terms, conditions, limitations and exclusions set forth in the applicable Credit Insurance
policy. This advertisement does not in any way alter, supplement, or amend the terms, conditions, limitations or exclusions of the applicable Credit Insurance policy and is intended only
as a brief summary of the program. Please consult the policy for the exact terms and conditions. No warranty, guarantee, or representation, either express or implied, is made as to the
correctness or sufficiency of any information contained herein. Credit Insurance coverage may not be available in all jurisdictions. Credit Insurance is underwritten by a national
insurance company.
2 Services for these products are provided by third-party vendors, with which UPS Capital Corporation has business relationships.
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23. Receivables Management Solutions
Benefits
•Expand international and domestic sales while effectively managing credit risk.
•Protect against bad-debt losses caused by insolvency or bankruptcy of your
buyers.
•Obtain credit protection for all of your buyers or for only a selected few.
•Convert your qualified receivables into cash, instead of waiting for payment.
•Make better credit decisions based on proprietary information.
•Outsource your collection function for all or for more difficult collections.
•Structure a flexible solution that meets your business needs.
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24. Trade Credit Insurance
Accelerate & Protect Payments
• Preserves and expands both domestic and international sales while
minimizing credit risk through the protection of a business’s accounts
receivable
• Provides you with business intelligence needed to help expand sales,
minimize risk, avoid unexpected bad-debt loss and get paid for what you
sell.
• Each credit insurance policy is structured to fit your particular business
situation.
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25. Trade Credit Insurance
Benefits
• Increase sales safely by providing credit
information on potential customers
• Better borrowing position with secured
receivables
• Strengthens the balance sheet and protects
profitability
• Collection services
• Protection for the entire portfolio or top buyer(s)
from unforeseen or unpredictable bad debt loss
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26. Non-Funded Collection Factoring
Accelerate & Protect Payments
• Provides flexible credit coverage and professional collections of domestic and
international receivables
• Provides flexibility to cover a selected portion of a receivables portfolio
• Can provide coverage for very large debtors
• Provides the ability to increase sales safely
• Better borrowing position with insured receivables
• Reduces cost of underwriting buyers
• Flexible terms
• No large up-front deductible
• Pay as you go service fees
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27. Receivables Financing
Accelerate & Protect Payments
• Converts accounts receivable into immediate cash.
• Protects against non-payment of your customer.
• Provides greater flexibility than traditional bank lines.
• Improves your collection efficiency.
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28. Credit Intelligence
Accelerate & Protect Payments
• Provides key credit information on buyers while helping you to grow your
business with informed credit decisions.
• Gain access to multiple information sources with a broad reach of
international data.
• Online system with around the clock access to credit information.
• Monitor the credit condition of key buyers.
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29. Credit Put Options
Accelerate & Protect Payments
• Offers 100% non-cancelable protection.
• Eliminates coinsurance and deductibles.
• Protection of single debtor(s) or buyer(s).
• Covers distressed debtor(s) or buyer(s).
• Flexible terms from 6 months to 3 years.
• Documentation is straightforward.
• Strong counterparties.
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30. Collections Services
Accelerate & Protect Payments
• Capability to provide global assistance for collection and litigation.
• Specialized and experienced professional collection staff.
• Improve the efficiency of your collection efforts.
• Customized programs to meet your business needs.
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31. Receivables Management Solutions
Case Study
Client Overview
• A US-based manufacturer / distributor of stainless steel bottles had experienced
significant growth over the past three years. The manufacturer / distributor had
plans to expand to overseas markets, including Asia, and was pursuing
additional sales channels such as trade shows.
• The company typically offered customers open account terms of net 30 days
but had recently experience bad debt losses of $20,000. They were also
concerned about concentration - their largest 20 of 2,000 customers
represented half of their total sales.
Solution
• A Trade Credit Insurance policy was put into place to help protect the company
against additional bad debt losses from concentration and from their expansion
into foreign markets.
• The company was also able to begin extending credit terms beyond 30 days to
become more competitive in the marketplace.
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33. Protect Your Goods
As you seek to enter new markets, expand into new lines of business, or trade
internationally, your business is exposed to risk.
UPS Capital Insurance Agency, Inc.*, offers solutions to protect your business
against the associated risks of trade.
•Cargo Insurance
•Flexible Parcel Insurance
* Insurance is offered through licensed insurance producers affiliated with UPS Capital Insurance Agency, Inc., and other affiliated insurance agencies. UPS Capital Insurance Agency,
Inc. and its licensed affiliates are wholly owned subsidiaries of UPS Capital Corporation. UPS Capital Insurance Agency, Inc. and its licensed affiliates reserve the right to change or
cancel the program at any time. The insurance program is governed by the terms, conditions, limitations and exclusions set forth in the applicable insurance policy. This document does
not in any way alter, supplement, or amend the terms, conditions, limitations or exclusions of the applicable insurance policy and is intended only as a brief summary of the program.
Please consult the policy for the exact terms and conditions. No warranty, guarantee, or representation, either express or implied, is made as to the correctness or sufficiency of any
information contained herein. Insurance coverage may not be available in all jurisdictions. Insurance is underwritten by a national insurance company.
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34. Cargo Insurance*
Protect Your Goods
• Protects shipments against loss or damage from the time they leave your
facility until the client receives them, regardless of mode of transportation
or carrier
• Customizable programs that can cover shipping risk, warehouse risk and
contingency coverage to protect the buyer and seller, or choose
CargoEdgeSM, our most comprehensive policy
• Insure a single shipment or all shipments (comprehensive coverage)
• Simple claims process that delivers efficient resolution and settlement
• May also protect against concealed damage, expediting expenses, general
average losses, labels and brand issues
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35. CargoEdge℠*
Protect Your Goods
• Our most comprehensive and far-reaching cargo
insurance policy
• Ensures that your goods are covered in the
majority of situations, under one simplified policy
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36. Cargo Insurance*
Benefits
• Worldwide, multimodal (land, ocean or air) coverage available on any
transportation carrier
• Customized programs that cover shipping risk, warehouse risk and
contingency coverage to protect your financial interest in the goods
• Fast claims resolution with most claims processed within 12 days — many
insurers ask for 30 days
• Choose CargoEdgeSM, our most far-reaching coverage in one simple policy
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37. Cargo Insurance*
Case Study
Client Overview
• A US-based distributor of heavy-duty winter clothing imported goods
from the Far East / Asia and Africa.
Challenge
• The company was using their general business-owner’s insurance
policy (BOP) to insure shipments. However, the cost for BOP
insurance was excessive and the coverage for the company’s
shipments was not comprehensive.
Solution
• UPS Capital Insurance Agency, Inc., was able to position a
comprehensive Cargo Insurance policy to save money for the
company while expanding coverage for their shipments.
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39. Flexible Parcel Insurance*
Protect Your Goods
• Flexible Parcel Insurance goes above and beyond the standard
protection offered by UPS and is designed to protect time-sensitive
goods and other hard-to-value items in the event of loss, damage or
delay.
• Three types of Flexible Parcel Insurance are available:
– Basic: Covers loss or damage to goods in transit up to
selling price.
– Expanded: Covers consequential losses as a result of
delayed shipments. Also covers items that are excluded from
Declared Value (e.g., the face value of phone cards).
– Time in Transit: Covers delays in transit for time-sensitive
or perishable goods.
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40. Flexible Parcel Insurance*
Benefits
• Protects against damage to high-value,
perishable, or time-sensitive items
• Protects items that are ineligible for standard
carrier liability programs
• Protects against costly consequences related to
your shipments, such as reconstructing
documents or interest on a late payment
• Flexible Parcel Insurance also provides coverage
up to your selling price – not just your cost
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41. Flexible Parcel Insurance*
Case Study
Client Overview
• Leading paper maker was required to ship original “certificates of origin”
prior to shipping goods.
• Certificates must arrive at destination within 5 days or company had to pay
for expedited reconstruction in order to complete order.
Challenge
• Company was paying high reconstruction costs for a critical part of their
transactions. They sought to mitigate their risk.
Solution
• UPS Capital provided a Flexible Parcel Insurance – “Time in Transit” policy
to cover the company’s certificates.
• If the certificates did not arrive within 5 business days, the reconstruction
claim would be paid, thereby reducing the customer’s exposure.
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43. Improve Cash Flow
The financial expertise of UPS Capital combined
with UPS’s proficiency in facilitating international
trade makes us unique in the marketplace. We
provide solutions that help finance your international
trade.
UPS Capital Cargo Finance ®
Export Credit Agency*
Global Asset-Based Lending
Loans made in California are pursuant to a Department of Corporations California Finance Lenders License. Products
may not be available in all areas and may be modified based on requirements. Check with your UPS Capital
representative for local availability. Credit availability is subject to approval.
Products are offered through UPS Capital Business Credit, a subsidiary of UPS Capital Corporation. UPS Capital
Corporation is neither an agent for, nor associate of, UPS Capital Business Credit for the purposes of originating,
processing, underwriting or servicing government guaranteed loans (e.g., Ex-Im guaranteed loans). Products may not
be available in all areas and may be modified based on requirements. Check with your UPS Capital or UPS Capital
Business Credit representative for local availability. Credit availability is subject to approval.
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44. UPS Capital Cargo Finance®
Improve Cash Flow
Provides inventory financing, on a
transactional basis, to customers who are
importing goods via UPS Ocean Freight
and using UPS Customs Brokerage.
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45. UPS Capital Cargo Finance®
Benefits
• Increase sales by offering better terms to your customers
• Lower your cost of goods by paying your suppliers earlier in the
supply chain
• Improve relationships with suppliers
• Reduce or eliminate the need for letters of credit
• Gain efficiencies in the supply chain, reducing transit times and
unexpected delays (further reducing costs)
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46. UPS Capital Cargo Finance®
Improve Cash Flow
International Supplier
Bill of Ocean Freight U.S. Customs U.S. Borrower Invoices Created End Customers
Lading Created Clearance
Day 1 Day 15-30 Day 60+
The financing of international in-transit inventory shipped (all modes) by UPS
How it works:
1. US-based borrower purchases inventory from an international supplier
2. UPS Capital finances a portion of the value of the international in-transit inventory that is
moved by UPS (air/ocean freight or small package)
3. UPS Capital will extend credit lines of $150,000 to $500,000 with up to 60 day terms
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47. UPS Capital Cargo Finance®
Case Study
Client Overview
• Wholesaler of building materials that supplies hardwood flooring and decking to
big-box home improvement retailers, wholesalers and manufacturers.
Challenge
• Company was forced to pay suppliers in Brazil when shipments left port, draining
valuable cash flow until the shipments arrived in the U.S. and were sold to
customers.
• Needed additional cash flow to fund continued operations and growth.
Solution
• UPS and UPS Capital provided an end-to-end solution that included Ocean
Freight, Customs Brokerage, UPS Small Package, Cargo Insurance, and UPS
Capital Cargo Finance.
• UPS Capital’s financing of imports increased working capital, leading to
increased imports and business growth.
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49. Global Asset-Based Lending
Improve Cash Flow
• A revolving line of credit secured by foreign warehoused inventory,
international in-transit inventory, domestic inventory and
receivables.
• Committed facility with a $2MM to $50MM credit limit
• Advance rates of 50% or more on inventory per appraisal
• Generally used for finished goods but can also advance on raw
materials
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50. Global Asset-Based Lending
Traditional Asset-Based Loan Structure
$2 Million $12 Million
Inventory in U.S. Accounts
Warehouse Receivable
Typical ABL Loan
Inventory (50% LTV) $1.0 million
Accounts Receivable (80% LTV) $9.6 million
Total Loan $10.6 million
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51. Global Asset-Based Lending
Global Asset-Based Loan Structure (Example)
$2 Million
Inventory in Asian
Warehouse
$2 Million $12 Million
Inventory in U.S. Accounts
Warehouse Receivable
$2 Million
Inventory In transit
Integrated GABL
ABL Loan Typical ABL Loan
Loan
In Country (U.S.) Inventory (50% LTV) $1 million $1 million
In Transit Inventory (50% LTV) — $1 million
Out of Country (Non U.S.) Inventory (50% LTV) — $1 million
Accounts Receivable (80% LTV) $9.6 million $9.6 million
Total Loan $10.6 million $12.6 million
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52. Global Asset-Based Lending
Improve Cash Flow
Company Overview
• Wholesaler of seasonal outdoor products.
• Profitable with revenues in excess of $96 million.
• Suppliers: Located in China, Taiwan and Dominican Republic.
• Customers: Fortune 500 Retailers.
Challenge
• Client needed additional working capital to fund continued operations and growth
heightened by the seasonality of the business.
• Client’s current lender was uncomfortable about increasing needs for advances on
inventory in transit.
Solution
• UPS Capital increased senior debt facility from $20 million to $35 million
• Credit lines of $3 million on in-transit & $2.5 million on foreign inventory that were not
available previously
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54. Inventory Buyer Credit
Improve Cash Flow
Short-term Loan
• Lines of credit to foreign companies purchasing raw materials, spare parts or
inventory items from the U.S.
• Loans backed by a U.S. Ex-Im Bank insurance policy (coverage is typically 90%).
• 100% of contract value can be financed for eligible products.
• Inventory loans are offered in select markets and for U.S. products only.
• Loan Amount: From $150,000 to $3 million.
• Repayment terms for each advance are generally 90 to 180 days.
• Collateral may be required for facilities exceeding $1 million.
Products are offered through UPS Capital Business Credit, a subsidiary of UPS Capital Corporation. UPS Capital Corporation is neither an agent for, nor associate of, UPS Capital
Business Credit for the purposes of originating, processing, underwriting or servicing government guaranteed loans (e.g., Ex-Im guaranteed loans). Products may not be available in
all areas and may be modified based on requirements. Check with your UPS Capital or UPS Capital Business Credit representative for local availability. Credit availability is subject to
approval.
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55. Equipment Buyer Credit
Improve Cash Flow
Medium-term Loan
• Direct U.S. dollar loans to foreign entities to finance the import of U.S. capital
equipment.
• Loans are backed by a guarantee or insurance by an Export Credit Agency (US Ex-Im
Bank is the Export Credit Agency of the United States).
• Coverage is typically 100%.
• Amount eligible for financing is typically 85% of contract value.
• Local cost financing of up to 30% of the contract value may also be available.
• Co-finance arrangements between ECAs could increase amounts eligible for
financing.
• Loan amounts range from $350,000 to $10 million.
• Repayment terms typically range from three (3) to seven (7) years, depending on
contract amount and type of equipment.
• Terms of 10 to 18 years may be available depending on the nature of the project and
type of equipment.
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56. Equipment Buyer Credit
Improve Cash Flow
Long-term Loan
• Loans in excess of $10 million (US Ex-Im Bank Coverage is typically 100%).
• Repayment terms range from 7 to 12 years, depending on the nature of project, the
type of equipment, and the country classification.
• An 18 year term may be available for deals involving environmental equipment.
• Amount eligible for financing is typically 85% of the contract value.
• Local cost finance equal to 30% of the contract value may be available.
• Co-finance arrangements between ECAs could increase amounts eligible for
financing.
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57. U.S. Exporter Working Capital Lines
Improve Cash Flow
U.S. Exporter Working Capital Lines
• Revolving, or transaction specific, working capital lines of credit
from $250,000 to $2 million
• Help fulfill export sales orders
• Turn export-related inventory and accounts receivable into cash
• Advance rates are typically more generous than those that are
generally available in the market
• Eligible exporters must be based in the U.S. and the goods
must be shipped from the U.S.
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58. Equipment Buyer Credit
Borrower Eligibility Requirements
• Borrower must have been in the same line of business for a
minimum of three (3) years
• EBITDA/Debt Service (including proposed debt if more than 25% of
total liabilities) is at least 1.5x for the last fiscal year
• Overall exposure should not exceed 40% of the borrower’s tangible
net worth
• Borrower’s total liabilities should not exceed 1.75x tangible net worth
• Borrower must have net profits during the two most recent fiscal
years
• Net operating cash flow must be positive in the last fiscal year
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59. Equipment Buyer Credit
Success Story
Client Overview
• An Argentina-based hospital needed approximately $1 million in new medical
equipment from a U.S.-based supplier.
Challenge
• The U.S. supplier was willing to extend terms. However, the Argentine hospital was
unable to get financing in their local market.
Solution
• UPS Capital provided an end-to-end solution that included air freight and financing for
the medical equipment.
• UPS Capital financed $1 million, while UPS Logistics managed the delivery of all
equipment.
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60. Thank you
UPS Capital Corporation
35 Glenlake Parkway
Atlanta, GA 30328
1-877-263-8772
www.upscapital.com