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Mercantile Commercial Capital to Become a National Bank
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We’re proud to announce a new phase of our company, and a very unique opportunity we thought you’d want to be made aware of. Our company is taking the next, natural progression and morphing into a national bank (it will actually be acquired and become a division of the new bank). While this information will only have been public for a very short time once you’re reading it here, we wanted you to be among the first to know. We have already submitted the formal national bank charter application to the OCC and FDIC, and have already held our preliminary meeting with federal regulators from Dallas and Atlanta late last month. We expect to get our charter approved in the June timeframe and open our new bank doors in late Fall. We have diligently and quietly been working on this since late Summer, and our new firm will be known as Emergent National Bank.

So why exactly are we doing this, you might be wondering? The simple and straight-forward answer is the creation of additional value for you and for us. As successful as MCC has become in our five years of business, we still have some limitations that could easily be overcome if only we weren’t a non-bank lender but an actual bank. For starters, there are a tremendous amount of additional banking products and services that we currently don’t offer at MCC, but our existing Clients and Referral Partners have asked us to provide (“begged” might be a better way to put it). See, we hear the frustrations of dealing with other financial institutions from our Clients and Referral Partners daily. Many have actually gotten a bit frustrated that we’ve stayed so focused on just our core business of financing commercial property for business owners and entrepreneurs for so long (they usually cool-down once we explain that our singular focus and specialization are THE primary reasons for their terrific lending experiences). But as smart entrepreneurs and capitalists, we KNOW the time is now right to bring our refreshingly competent ways into the full banking industry again and continue our successes within the gaping opportunities we see. With the banking industry’s state of affairs what it is today, any good contrarian would comment that NOW is the correct time to launch a bank, especially one that will continue to focus on the needs of an under-served market: business owners and entrepreneurs. We’ve become known as “America’s 504 Loan Experts,” but it’s now time to be the “Small Business Banking Experts” and help in even greater ways.

My business partner, Geof Longstaff (also a Principal in Small Bay Development and the Chairman of the Orlando-Sanford International Airport Authority Board), and I have joined teams with our old friend and colleague, Shannon Marks, currently a commercial developer and formerly the Co-Senior Lender at First National Bank of Central Florida. Shannon will become Emergent’s new President with Geof as the Chairman and me as the Senior Executive Vice President, still in charge of the MCC division, the bank’s governmental lending programs, and the bank’s marketing efforts. As I do not have technical, traditional banking experience in the eyes of federal regulators — past stints at large, non-bank commercial lenders like GE Capital and Heller Financial do not count, nor does leading MCC for the past five years technically count – Shannon will very ably lead the bank in his capacity as President.

What should seem interesting to you already is that each of us are entrepreneurs in our own right and that we will be bringing to life the nickname we were given several years ago, that of “the entrepreneurial bankers.” This isn’t another case of “serial bankers” launching another “me-too” bank. We will continue to do things differently and better than the industry at large… just as we have at MCC for over five years. And fear not, we won’t dilute the branding of MCC or change the focus of that division in any way – we consider it the engine of Emergent’s future growth. And yes, we will continue NOT to take ourselves too seriously and have the kind of fun we’ve become known for. We strongly believe a fun, focused enterprise that “works hard and plays hard” is the ideal business for all parties involved, be they Clients, Employees, Referral Partners, Shareholders or even potential Clients. So continue to expect better business as usual from us… just soon, on a bigger, broader stage.

We have assembled a very capable Board (which has committed over $5.97 million in capital or 17% of the total raise already) and have been meeting since October to finalize various plans. In addition to the MCC team already being in place, which will allow our bank (unlike virtually all other de novo banks) to immediately have loans producing revenues and profits, Shannon has already quietly assembled a very capable group of current bankers and other banking staff in town to move over to Emergent once the doors open. We have also secured (the lease is finalized) our new corporate headquarters and first branch in the affluent area of Winter Park.

We have been asked countless times in our first few years of existence at MCC if we needed more investors (that’s usually a good sign that you’re making a positive splash in the marketplace)… while we always politely declined, we never did keep a list. I suppose shame on us. Those interested eventually stopped asking us if we’d take more capital, as we never did raise more than our original $1.2 million. You should know that unlike many start-up banks who announce their intentions first, we like to “stack the odds” in our favor; so by the time you’re reading this, we’ll already count over $21 million in “soft commitments” . . . well on our way to realizing our vision (and goal of $37 million).

While our forthcoming prospectus will not allow us to so enthusiastically tell you how great an investment this will be, I can tell you that Geof’s previous community bank, First Mercantile National Bank, sold at a 220% return over 9 years or approximately 24% annualized. I can also mention that in purchasing MCC for Emergent at our independent, third-party’s valuation of $11 million, our MCC shareholders will realize a 817% return over 5 ½ years or approximated 124% annualized (not including substantial distributions paid since the second year of operations). We think both of these examples demonstrate our capabilities to create shareholder value and be good financial stewards. And neither of those examples include some of the dynamic capabilities our new bank will soon have which will serve to maximize shareholder value. No other start-up bank we are aware of has had the kind of advantages MCC brings to Emergent. This is truly an exciting time for us as it soon will be for the business owners and entrepreneurs of Central Florida and beyond.

Should you want to discuss more about our upcoming bank opening in further detail, kindly email or call us to schedule a phone appointment or if you’re in the local area, we’ll be happy to schedule a meeting with you in-person. Also, if you want to share this information on a VERY limited basis with other potentially interested parties, please feel free to do so, but we ask that you notify us when you do, so we may keep track of who has seen our information.

As always, you have our continued Best wishes for Success in all you do.

Respectfully Yours,

Chris and Geof

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