Credit Facilities / Terms
- Committed or demand facilities
- 2–4 year contract term
- Up to 85% of eligible accounts receivable
- Up to 60% of eligible raw materials and finished goods inventories; higher if supported by an appraisal
- Up to 80% of appraised liquidation value of equipment with an amortization schedule of up to 72 months
- Up to 75% of the appraised value of owner occupied real estate with an amortization schedule of up to 180 months
- Personal guarantees in most situations
- Modest covenants structured on the necessary cash flow to service the contemplated capital structure
- Interest rates floating based on Wall Street Journal prime rate with a floor of 5%
- Competitive closing and facility fees
- Periodic audits conducted by First Business Capital Corp. staff at competitive rates
- Bank participations welcomed
General Features / Terms
- Committed documents with financial covenants
- Competitive pricing: prime based; reasonable fees
- Limited personal guaranty where appropriate
- Flexible cash management options — local banking
- 2 or 3 year loan agreement
Client / Transaction Profile
- Manufacturers, Distributors, Processors, and Business Service companies
- Privately/closely held ownership
- Sales of $5 – $50 million
- Referred to First Business Capital Corp. by an advisor
- Critical timeline/sense of urgency
- Structural change in the business
- Recent performance (last 30-90 days) indicative of future
- Trade Accounts Payable no longer an issue after First Business Capital Corp. financing
Pre-proposal Information
- Current & prior year comparable interim financial statement
- Last 3 individual monthly financial statements
- Prior 2 years of fiscal year-end financial statements
- Monthly projections (income statement & balance sheet)
- Accounts receivable & payable agings (same date as F/S)
- Inventory reports summarizing composition & locations
- Most recent borrowing base certificate from current lender
- Product brochures, business plan, & industry analysis
- Shareholder composition, management/owner bios
- Personal financial statements of the principal shareholders
- M&E appraisal
- Real estate appraisal, most recent survey, & Phase I environmental assessment
Process Time Line
First Business Capital Corp. will respond as the circumstances determine. We are able to conduct many activities concurrently.
- Review request and information provided
- Visit: meet owner/managers; tour operations
- Prepare Proposal Request
- Review Proposal Request; issue Proposal Letter
- Execute Proposal Letter; receive deposit; schedule audit
- Audit 4-8 days; appraisal within 2-4 weeks
- Review audit; present request to DLC for approval
- Prepare and finalize documentation; close
- Expect to close within 4 weeks of the start of the audit
