How CAP Works

How the funding process works

Step 1. Prospect, bank customer client submits:

• Financial statements
• Business Plan
• Aging of payables
• Aging of receivables
• Personal financial statements of principals
• As much additional information as possible, for example:
• • company history
  • management history
  • product information
  • inventory details
  • machinery & equipment information
  • real estate information

• Based on this information, and in consultation with the bank, we generate a proposal.

Step 2. Client receives, negotiates and accepts proposal.

• Franklin prepares client underwriting approval memorandum which includes and is based on the following:
• • Client information
  • Detailed description of transaction
  • Nature of business
  • Years in business etc.
  • Recommended structure of transaction and rates
  • Outline of any special circumstances
  • Management history overview
  • Company history summary
  • Company operations detail
  • Company product and or services summary
  • Collateral availability breakdown
  • Financial statement trends
  • Legal organization of company including name of principals
  • Guarantor analysis
  • Receivable aging summary analysis of business five largest receivables
  • Payable aging summary including five largest payables
  • Inventory breakdown into finished, WIP and raw materials
  • Real Estate analysis if any
  • Machinery and equipment analysis

Step 3. Deal is approved by Franklin.

• Transaction approval recommendation is provided to bank with credit committee write up for final Bank/Franklin approval.

Step 4. After Final Approval by Bank and Franklin:

• Transaction is documented and closed.

Pre-funding Check

Step 5. Client submits up to date customer list and receivable aging.

• Franklin captures all client customer and invoice data.
• Franklin verifies authenticity of receivables prior to initial client payout.

Step 6. Franklin continues to receive invoice data from client.

• Franklin captures all data electronically
• Invoice, sales and shipment information is verified by Franklin
• Franklin monitors customer credit worthiness
• Verifies ongoing assignments of receivables prior to funding
• Franklin provides collection effort on past due receivables
• Franklin reviews disputed accounts and mediates successful resolutions
• Franklin sends out monthly statements and processes all collections
• Calculates reserve payment refunds to client and advises Bank
• Franklin disperses advances to client
• Franklin disperses client reserve to blocked client reserve account at bank

Step 7. Client’s Customers pay to designated lock box at the Bank or at Franklin.

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