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					Financing Small and Medium Sized Companies in
a credit crunch

                      1              Financial Innovations
Small and Mid-Cap publicly traded Companies
(SME’s) in a credit crunch

   •   What’s the issue?
        • Starved of finance despite good business (in many cases)
   •   Where?
        • Almost everywhere
   •   What’s this about?
        • Small amounts of money : too much for friends and family,
          too modest for a Bank
        • Advice : tailoring the finance, supporting the client firm
        • And earning an appropriate return for Investors

SME’s defined

•   In most countries, ‘SMEs’ are small and medium sized enterprises with up to
500 employees.

•    EU member states define companies with fewer than 50 employees as small
and those with fewer than 250 as medium.

•   In the United States, a small business is a company with fewer than
100 employees and a medium-sized business one with up to 500 employees.

•    Canada defines an SME as any business establishment with 0 to 499 employees
and less than $50 million in gross revenues.

SME’s importance

•    SME’s make up a significant portion of developed countries economies

•     SME’s have been one of the largest contributors to overall employment
and account for above 50% of all job growth

•     1997 Statistics count about 18 million SME’s in the European Union and
over 15 million in the United States

•    SME’s in Europe contributed over 55% of sales compared to 47% in the
US based on 1995 numbers. In 1998, European SME’s provided 65% of turnover

SME’s attraction for specialist investors

  •   Less bureaucracy and less inertia
  •   Thinner management ranks which allow for quick decision making processes
  •   Smaller capital budgets = opportunity for lenders to “fill the gap”
  •   Immediate and available equity component to increase the upside to lenders

SME’s - how the crisis bites

•   Recession does not affect all SME’s equally; positive business opportunities require
    capital quickly
•   But the credit crisis has reduced financing options
•   Bank debt (where available): ties up all corporate assets, blocks other borrowing
•   Lenders in general cannot bear the risks associated with this class of debt
•   Publicly listed SME’s are the “orphans” of capitalism and capital markets
•   For publicly traded SMEs, a ‘Secondary’ equity issue is lengthy, costly and dilutive,
    uncertain, and almost always conducted on a “best efforts” basis
•   No access to cross-border financings, nor advice
•   Management ‘desperation’ often leads to poor use of available capital on hand, i.e.
    paying consultants and other financiers ahead of actual funding

SME’s - bottleneck

  •   Strong demand for SME 'event finance’, supply is tight:
      - Basel II
      - Illiquid markets
      - Credit crunch
  •   Stock exchange quoted SME’s under particular pressure
  •   All the above drives the search for alternative sources

SME’s - candidates for ‘alternative’ finance

  •   Alternative providers of finance can help where the traditional establishment
      cannot, and potentially make a good return

  •   SME’s lack appropriate resources to introduce effective risk management
      practices, and many need support to achieve sound financial growth

  •   Alternative providers can mitigate some risks by offering the necessary
      knowledge, resources and financial advice to SME’s, and monitor the
      borrowers’ activities

  •   Lenders can hand pick the best prospects based on the companies’ willingness
      to pay the going rate (interest rate, cost of capital) and their ability to repay the
      borrowed funds

  •   Equity taken as fees or ‘kickers’ has a 1 in 20 chance of increasing in value by
      1000’s of percent.

SME’s - sources of finance include

    •   Secondary Placements (rare)
    •   Non-bank specialist financiers
    •   Private Equity
    •   Multi-Strategy Funds
    •   Government bodies
    •   Dedicated overseas funds
    •   Trafalgar Capital Advisors:
        a unique conduit for new money to support selected, growing

SME’s and Trafalgar Capital Advisors (TCA)

•          Trafalgar Capital Advisors Investment Strategy:
       •  Corporate finance advisory and short term financing solutions for (mostly)
          publicly listed SME’s from Trafalgar’s alternative investment fund
       • Combined service increasingly perceived to be like a mini merchant bank
•       Innovator in Europe, wide overseas ‘reach’
•       FSA** regulated corporate advisory services
•       No leverage, no shorting
•       Targets low volatility, uncorrelated returns

**FSA: Financial Services Authority, independent body that regulates the financial services industry in the UK.

SME’s - TCA: a specialist provider

   •   Privately negotiated financing transactions and fee-generating advisory
       services for (mostly) listed small- and mid-caps
   •   Senior convertible redeemable debentures, Committed Equity Facilities,
       mezzanine finance strips, short term receivable and asset backed loans,
       invoice discounting and factoring
   •   All fees flow into the Fund
   •   Focused on modest sized transactions - uneconomic for most other
       providers (USD 500k - USD 5.0mln)
   •   50% repeat business
   •   Geographic and sector diversification
   •   AIMA best practice

SME’s - TCA’s pragmatic offering:

The Fund’s business model has evolved to include :

•   accounts receivables revolving lines
•   invoice discounting
•   purchase order funding

This reduces transaction duration, is secured by hard collateral and relies more on the
credit of the Borrower’s customers than on the credit of the borrowing Company itself.
The result equals much less risk to the lender.

  TCA Global Credit Master Fund - Profile

•The Fund is registered with Cayman Islands Monetary Authority (CIMA)
• Strategy:

    - Corporate finance advisory and short term financing solutions for publicly listed

    - Directly negotiated debt and equity-related investments in public and, to a lesser
    extent, private companies on a worldwide basis, including companies established in
    Europe, the Americas and Asia
    - Target returns in the range of 12-14%
• No leverage, no shorting
• Low volatility, superior risk-adjusted, uncorrelated returns

TCA Global Credit Master Fund, LP
The Master Fund has two feeder entities:
 TCA Global Credit Fund, LP (U.S. taxable investors)
 TCA Global Credit Fund, Ltd. (Non U.S., tax exempt investors)

TCA Global Credit Master Fund, LP is an evolution of Trafalgar Capital Specialised Investment Fund FIS (TCSIF) which was the first
independent, European-based alternative investment fund focusing on privately-negotiated funding transactions for small and mid-cap
publicly traded companies in Europe and overseas.
TCSIF is also a follow on fund to Montgomery Capital Partners (see track record on Historical Returns page)
Although TCSIF will continue to exist as a stand-alone fund, TCA Global will allow for more flexible investing opportunities, as well as
offer the product for the first time to North American taxable investors and US tax exempt investors such as charitable foundations and
non-US investors.

                           Strategy: CREDIT + Merchant Banking

                           Minimum Investment: USD100,000

                           Fees: 2% / 20%

                           Redemption: 1 Year Lock Up / 90 Days Notice

                           Subscription: 1st of Every Month

                           AUM: Soft Close / USD500 Mln

                           Share Class: USD     / EUR

                              * Transactions will be denominated in US dollars

                                 TCA’s Investment Process

    Deal           Deal                Investment            Legal Due             Portfolio         Transaction    Monitoring to
Origination       Analysis               Review              Diligence             Committee            Close        Repayment

8 investment    Fundamental,          Establish              Engage local                            Documents     Bi-weekly calls
professionals   credit and            most efficient         legal experts         CIO led           executed      with management
and analysts    liquidity             investment             to evaluate                                           to monitor
                                                                                   Deal size and     Investment
                analysis              structure and          and structure                                         evolution of
Global                                                                             duration vis-à-   executed
                                      terms/pipeline         deals                                                 investments
network of      Management                                                         vis portfolio
professional    team track            On site visit          Standardized          capacity                        Identify and action
advisors        record                                       legal                                                 stressed position
                                      Independent                                  Monitor cash
                                                             documents /
Sponsor and     Corporate             board                                        flow to deal                    Notify board on
                                                             jurisdiction to
attend          structure             members                                      flow                            stressed positions
conferences                           approval                                                                     and actions taken
                Evaluate                                     process               Accept/modify
50% repeat      investment                                                         /reject terms                   Completion of
business        risks/reward                                                                                       payment

                    Thorough: fundamental, credit, liquidity, fund & market dynamics
                    Long term relationships with investee companies;
                    50% repeat business
                    In house expertise for work-outs when needed

                                           SME Transaction Risks
                                                           Credit

                                                           Duration

                                                           Corporate specific execution risks

                                                           General market conditions

                                Risk Analysis and Management Processes

                                                             Iterative Process


1. 95% of portfolio companies are listed and
                                                                                                  1. Portfolio construction: exposures and
                                                                                                  concentration limits
2. Fundamental analysis and proprietary due
                                                                                                  2. Instruments: duration, no market risk
diligence questionnaire

                                                                                                  3. Structures: asset-backed, cash repayments and
3. Dedicated relationship manager

                            Corporate Governance: external administrator, independent valuation agent and oversight from
                            independent directors – 50% of Board Directors are independent

                                                                  Morningstar Rating

Historical Returns
Year           Jan    Feb     Mar      Apr     May      Jun      Jul      Aug      Sep      Oct      Nov      Dec      YTD
2010          1.07%   0.88%                                                                                           1.96%
2009          1.30%   1.42%   1.06%   1.25%   0.91%    1.22%    1.27%    1.07%    0.87%    1.48%    1.15%    1.02%    14.95%
2008          1.39%   1.53%   1.27%   1.88%   1.69%    1.59%    1.64%    1.61%    1.44%    1.28%    1.40%    1.31%    19.59%
2007 **       1.14%   3.60%   2.12%   1.98%   2.32%    2.08%    1.51%    1.31%    1.21%    1.88%    1.00%    1.41%    23.79%
2006          0.97%   1.48%   0.99%   1.93%   2.08%    1.60%    0.65%    0.76%    0.24%    0.83%    0.99%    1.02%    14.39%
2005          1.86%   1.43%   1.22%   1.41%   0.87%    1.72%    1.10%    0.92%    1.04%    1.09%    1.05%    1.23%    16.00%
2004 *                                                                                              2.19%    2.36%    4.60%
* Montgomery Capital Partners track record (November 2004 – January 2007)
** Trafalgar Capital SIF track record (February 2007 – Present)
The above monthly returns are net of fees (2% management fee / 20% performance fee). Audited results for 2004-2008.

    120.00%                                                                                           Total Cumulative Return for the period
    100.00%                                                                                           Nov’04-Feb’10 is: 140.86%
          M 05

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TCA Founding Partners

Bob Press
Founding Partner

Bob Press’s career spans over two decades in finance. He began his career in the Capital Markets Group of Chemical Bank and rose to
become the head of global derivative products trading from 1986-1990. He has been a principal in asset management, brokerage and
investment banking companies and has served on industry panels and as an officer and director of public and private companies. His
diverse background includes years of experience in structured finance, asset-backed lending, securitisations and mergers and acquisitions
both within the US, Europe and Asia. Prior to the formation of Trafalgar Capital Advisors, Bob was co-Founder and Portfolio Manager of
Montgomery Equity Partners L.P., a Cornell Capital Partners L.P. sponsored PIPE fund. Bob has a BA in Economics with extensive
coursework in computer science from Brandeis University, Massachusetts.

Andrew Garai
Founding Partner

Andrew Garai is co-Founder and Managing Partner of Trafalgar Capital Advisors, London. He has been active in financial services in the
UK and Continental Europe for over two decades. Andrew is a graduate of Oxford University followed by an MBA course at IESE,
Barcelona. Moving into institutional stockbroking, Andrew was first based in Munich with a specialist institutional equity brokerage firm, then
for Dresdner Bank both in Frankfurt and in the London Branch where he set up the institutional equity sales desk. He continued with
German equity sales and research at Bear Stearns and LCF Edmond de Rothschild Securities, before moving to build a European and
overseas sales team at Fidelity Brokerage. Subsequently, acting as an independent consultant, Andrew has been engaged in marketing and
business development internationally with clients including a specialist AIM-listed active investment company, and for US, UK and
Continental European firms in the traditional and alternative investment industry.

Trafalgar Capital Advisors - Contact Information
                      Joanne Broeders
               18851 NE 29th Avenue, Suite 306
                     Aventura, FL 33180
                    305-466-9276 (Direct)
                     305-546-7189 (Cell)
                     786-323-1651 (Fax)

                        Andrew Garai
                        London Office
                   The Dickens, Kirk Street
                     16 Northington Street
                      London WC1N 2DG
                 (+44)0207 269 6880 (Direct)
                  (+44) 07785 274005 (Cell)
                  (+44) 0207 405 0161 (Fax)

                        Andrew Garai
                         Zurich Office
                   Alfred-Escher-Strasse 17
                     CH-8002 Switzerland
                  (+41) 44 202 11 46 (Direct)

This document is being furnished by Trafalgar Capital Advisors LTD, the Manager (“Manager”) of TCA Global Credit Master Fund LP (the “Fund”) solely for use
in connection with consideration of an investment in the Fund by prospective investors. The information contained herein does not constitute an offer to sell or
the solicitation of an offer to purchase any security or investment product. Any such offer or solicitation may only be made by means of delivery of an approved
confidential offering memorandum and only in those jurisdictions where permitted by law. Prospective investors should inform themselves and take appropriate
advice as to any applicable legal requirements and any applicable taxation and exchange control regulations in the countries of their citizenship, residence or
domicile which might be relevant to the subscription, purchase, holding, exchange, redemption or disposal of any investments. The information contained
herein does not take into account the particular investment objectives or financial circumstances of any specific person who may receive it. Before making an
investment, prospective investors are advised to thoroughly and carefully review the offering memorandum with their financial, legal and tax advisers to
determine whether an investment such as this is suitable for them. There is no guarantee that the investment objectives of the Fund will be achieved. No
statement herein supersedes any statement to the contrary in the Fund’s confidential offering documents. All information contained herein is confidential. This
document may not be reproduced or copied without the prior written consent of the Manager. This document is subject to revision at any time and the Manager
is not obligated to inform you of any changes made.
The performance representations contained herein are not representations that such performance will continue in the future or that any investment scenario or
performance will even be similar to such or description. In fact, there may be sharp differences between prior performance results of related funds; such
performance should not be construed as an indicator of future performance of the Fund. Performance information and/or results, unless otherwise indicated,
are un-audited and their appearance in this document reflects the estimated returns net of all expenses, including the management and performance fees
similar to those of the Fund.
Certain information contained in this material constitutes forward-looking statements, which can be identified by the use of forward-looking terminology such as
“may,” “will,” “should,” “expect,” “anticipate,” “target,” “project,” “estimate,” “intend,” “continue,” or “believe,” or the negatives thereof or other variations thereon
or comparable terminology. Such statements are not guarantees of future performance or activities. Due to various risks and uncertainties, actual events or
results or the actual performance of the Fund described herein may differ materially from those reflected or contemplated in such forward-looking statements.
The Fund has no operating history. An investment in the Fund is speculative and involves a high degree of risk. Opportunities for withdrawal and transferability
of interests are restricted. As a result, investors may not have access to capital except according to the terms of withdrawal specified within the confidential
offering memorandum and other related documents. The fees and expenses that will be charged by the Fund and/or its Manager may be higher than the fees
and expenses of other investment alternatives and may offset profits.
With respect to the present document and/or its attachments, the Manager makes no warranty or representation, whether express or implied, and assumes no
legal liability for the accuracy, completeness or usefulness of any information disclosed. In addition to exposure to adverse market conditions, investments may
also be exposed to changes in regulations, change in providers of capital and other service providers.
The Manager does not accept any responsibility or liability whatsoever caused by any action taken in reliance upon this document and/or its attachments. The
private investment fund described herein has not been registered under any federal, state or foreign securities laws. These interests will be offered and sold
only to “Accredited Investors” as such terms are defined under federal securities laws. By accepting this document and/or attachments, you agree that you or
the entity that you represent meet all investor qualifications in the jurisdiction(s) where you are subject to the statutory regulations related to the investment in
the type of fund described in this document.


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