FMC Financial Services Dallas Texas.

Small Businesses contribute 55% to the GNP of the United States, pay 70% of federal taxes, and are the largest growing sector of the economy. The Problem Although small businesses are the largest contributors to the economy, they experience a failure rate of 80% during the first five years. Half of the survivors fail over following three years. The major reasons for failure are lack of sufficient capital, business knowledge, and no exit planning.The Solution In its 28 years of working with businesses, FMC Financial Services, Inc. has identified the necessary business components and provides the solution by providing financing, knowledge, and exit planning. Business success and wealth are achieved at a 90% success rate. Financing Since capital is not easily accessible to emerging businesses, FMC Financial Services, Inc. has developed a variety of financing solutions using federal programs and equity capital. Financing includes 7-a, 504, B&I, SBIC, MESBIC and private investment capital. Knowledge The most important behavior distinguishing an entrepreneur from a business owner, is that an entrepreneur takes responsibility to understand the “business side of the business”. Failing that, they just own a job with all the related debt. Seminars: A series of thirteen essential business seminars and are offered on a regular basis. Examples are “Your Access to Capital”, and “The Five Biggest Mistakes in Business and How to Avoid Them”. FMC School of Business for Business Owners: FMC Financial Services, Inc. employs a distinctive teaching method developed from years of practical experience and problem solving. Three semesters are offered, and a background in accounting and finance is not required. Exit Planning Put simply, Exit Planning is about leaving your business on your own terms. It is one of the most essential parts of your overall Business Plan, and ensures you will receive the maximum financial return for your business and minimize you tax liability. Eventually every business owner will exit their business even if it is “feet first”. FMC has developed a proven system that assures an orderly transfer of ownership when you leave your business while realizing the maximum wealth for your hard work. Senior Management To assure that the highest quality of advice and service is available to our clients, seasoned professionals, having a combined 177 years of experience are ready to assist. Value Added Services Business Plans, Business Models, and Business Valuations Exit Planning, ESOP, Business Brokerage, Franchising Business Turnarounds 8-a Minority Business Contracting, Business Education - Business School.

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Financing Overview

Types of Financing

FMC Financial Services, Inc. has developed extensive expertise in providing various types of financing needed by small businesses. Generally financing can be divided into two categories; debt and equity. Debt financing is money borrowed and is to be paid back to a lender over a period of time. Equity financing is money invested into a business and the investor receives a percentage of ownership in the business. Unlike debt financing, the money invested does not have to be paid back.

Sources of Financing

Debt and equity are provided through two sources; government and conventional. Various government agencies such as the Small Business Administration (SBA) 7-A, 504, and the Business Industrial Foundation (B&I) make available funding to commercial businesses. Again this type of financing is government sponsored. All other funding programs not government sponsored, are referred to a “conventional” .

Financing Programs

Billions of dollars will be funded to small business this year through various government programs. A snapshot of what programs are available and the types of funding are as follows.

Debt Financing

U. S. Small Business Administration 7(a) loan guarantee program
This program was established in 1953 and provides debt financing by offering a loan guarantee to a qualified lender who makes the loan. Therefore it is referred to as a “guaranty” program. Funds can be used to finance working capital, real estate, equipment, accounts receivable, inventory. Loans made for non-real estate purposes have maturities ranging from 5 to 10 years. Real estate loans have a maximum maturity of 25 years. The maximum loan amount available to a small business is $2,000,000. Payments are usually scheduled on a monthly basis without balloon principal payments. Interest rates are negotiable and float or can be fixed, but cannot exceed prime plus 2.75%

U. S. Small Business Administration 504 Certified Development Company Loans
This program was established in 1980 to provide fixed asset financing for growing businesses. Unlike the “guaranty” program, funds come directly from the government treasury through a bond auction and can only be used for real estate and equipment. The unique concept of this program is that the SBA funds 40% of the project and takes a second lien behind the first lien lender which funds 50% of the project. The borrower injects 10% of their funds as equity into the project. The first lien lender can offer more aggressive financing terms to the borrower, because they will have a first lien on the entire project with only 50% on their funds at risk. The first lien lender’s interest rates are negotiable, but the government’s second lien note is always fixed and is set at the prevailing rate when the bonds are issued. The maximum amount available to a small business is $4,000,000. This has been a very popular program for financing owner occupied real estate for small business owners.

United States Department of Agriculture (USDA) Business and Industrial Guaranteed Loan Program
The Business and Industry (B&I) Guaranteed Loan Program helps create jobs and stimulates rural economies by providing financial backing for rural businesses. This program provides guarantees up to 80 percent of a loan made by a commercial lender. Loan proceeds may be used for working capital, machinery and equipment, buildings and real estate, and certain types of debt refinancing. B&I loan guarantees can be extended to loans made by recognized commercial or other authorized lenders in rural areas (this includes all areas other than cities of more than 50,000 people and the contiguous and urbanized area of such cities or towns). The maximum aggregate B&I Guaranteed Loan(s) amount that can be offered to any one borrower is $25 million. A maximum of 10 percent of program funding is available to value-added cooperative organizations for loans above $25 million to a maximum aggregate of $40 million. Loan terms usually range from 7years to 25 years depending on the purpose of the loan, and the lender negotiates interest rates.

Debt and Equity Programs

Small Business Investment Company (SBIC) In 1958 Congress created The Small Business Investment Company (SBIC) program which are licensed by the Small Business Administration, and are privately owned and managed investment firms. They provide venture capital to small independent businesses, both new and already established. All SBICs are profit-motivated businesses and not only fund loans but inject equity. Loans may have a maturity of no more than 20 years and can be structured as subordinated debt with detachable warrants that can be converted into stock at the appropriate time. SBICs may not invest in the following: other SBICs, finance and investment companies or finance-type leasing companies, unimproved real estate, companies with less than one-half of their assets and operations in the United States, passive or casual businesses (those not engaged in a regular and continuous business operation), or companies which will use the proceeds to acquire farm land. An SBIC is not permitted to control, either directly or indirectly, any small business on a permanent basis. The cost of money on SBIC loans is regulated by the SBA and is governed by applicable state regulations, or by SBA regulations. In general, investment funds used to purchase securities must go directly to the small business concern issuing the securities.

Minority Enterprise Small Business Investment Company (MESBIC)
They function identically as SBICs but they are able customized programs for minority owned
businesses.

Private Equity
FMC has developed several preferred investor sources many of which are previous owners of companies that FMC assisted in their exit strategy. The typical investment is made in amounts ranging from $500,000 to $6,000,000 to private companies with revenues of $5 to $50 million. We look for companies that seek growth capital to take advantage of market opportunities or to meet the capital needs created by:

• buyout a retiring partner,
• acquire a competitor,
• capital to expand market share

In addition to equity capital, FMC provides business management expertise to our portfolio companies. We are skilled at working with existing owners beginning early on in the process of securing growth capital. Often CEO/Owners know where they want to take the company but lack the resources to develop and implement a successful financial plan to meet their goals.

WHICH FINANCING PROGRAM IS RIGHT FOR YOU?

Each program has eligibility and credit requirements. To determine which program may fit your specific need, please contact a financial advisor at FMC Financial Services, Inc. to set an appointment and to review your project.