Alternative Funding Solutions Invoice Factoring A product used for cash flow acceleration NOT a loan Asset for Asset = off balance sheet

Factoring 101 It’s all about the invoice Because cash flow matters 2) Company presents invoice & back-up to Lender/Factor 3) Lender stamps assignment language on invoice and sends to Debtor 4) Lender advances Company on face value of invoices 5) Debtor remits payment to Lender 1) Company delivers product & generates invoice It’s all about the invoice Because cash flow matters

Why Companies Factor Features Benefits Who is it for? Invoices are sold and assigned to the Factor Customers (debtors) are notified on the face of the invoice Credit decision based on the strength and diversity of the debtor base Payment of the invoice are directed to the Factor Advance rates typically 80% - 95% Reserves, if collected, are released upon payment by debtor Continuous source of working capital Increased liquidity Back office support including: collections, cash application, credit analysis of new and existing customers Same day funding on approved invoices Benefits - Recently formed businesses - Rapidly growing companies - Poor financial trends (losses, highly leveraged, negative net worth, bankruptcy, etc) - Inadequate books and record-keeping Companies looking to enhance their balance sheets by improving debt-to- equity and debt-to-asset ratios. - Company seeking quick and easy solution for cash flow constraints Who is it for? Factoring provides an unlimited means of cash flow for your customers’ business

We are the solution your customer is looking for The Missing Piece We are the solution your customer is looking for Slow pay cycle time Short-term cash flow needs Purchasing equipment needs Expansion financing Means to meet daily operating expenses Violation of bank covenants No fixed assets / Yes current assets Weak company credit, but strong debtor base

How To Identify Prospects Listen “I can make my payment as soon as my customer pays me.” “I have to offer my customers payment terms, but it’s killing me.” “Collecting payments from my customers is a real pain.” “I’m just a small shop. I can’t do everything.” “I am working with a freight broker that is offering Quick Pay.” “I did the work and never got paid.” Ask How long does it take for your customers to pay you? Would it make a difference to your business if you got paid within 24 hrs? Would it help if you had back office help, including collections? Would it help if you could credit check new customers before performing the work? Funding source declines. Why?

What To Do With Prospects Introduce the basic concept of factoring Perform the work, prepare the invoice, send invoice, rate confirmation/contract and signed BOL/Work Order/Timesheet to Factor. Get money in your account within 24 hrs. Get permission to pass on contact information Introduce your factoring partner and set the call. Email or call lead information to Factor Most factors only need the contact & company name, phone number and email address. No need to collect and assemble a package. Factor will qualify the lead and collect items needed for Underwriting. Most Factors offer residual commission on leads that result in new business!!

Collateralized Working Capital And Sale Leasebacks Jason Sincleair

What is it? Sale Leasebacks consist of a business selling one or multiple assets to a Lessor and the Lessor immediately leasing it back to them. Collateralized Working Capital is the same concept other than it is booked as a loan and not a lease.

Benefits The benefits are the same as doing a standard lease Can be used by customers with a wide breadth of Credit Customer Retains the Asset Converts equity into cash, some funders lend up to 60% Tax Friendly Payback terms are longer Lower payments Transaction is fast

Who is a customer? Any entity that owns an asset or assets that can be remarketed. Most app-only lenders are doing an in-house desk top appraisal in order to associate a value of an asset in case of liquidation. A percentage of the equipment value that is obtained will be what a lessor will lend. In most cases somewhere between 40%-60%

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