California Code of Regulations
Title 10 - Investment
Chapter 3 - Commissioner of Financial Protection and Innovation
Subchapter 3 - Commercial Financing Disclosures
Section 951 - Factoring; Example Transaction

(a) For factoring transactions where the finance charge, annual percentage rate, or term varies based upon the type of the legally enforceable claim assigned, where the provider offers the recipient an agreement that describes the general terms and conditions of the commercial financing transactions that will occur under the agreement, and where the financer provides disclosures based upon an example of a transaction that could occur under the agreement under section 22803 of the code, the provider shall give the recipient a separate disclosure table under section 913 for each type of legally enforceable claim.

(b) Maximum draw amount. If the agreement between a financer and recipient permits an advance of funds to the recipient up to and including an approved advance limit for legally enforceable claims that have not yet been paid by the account debtor, the example transaction used in making the disclosures shall be equal to the approved advance limit.

(c) No maximum draw amount. If the agreement between a provider and recipient does not specify an approved advance limit for legally enforceable claims that have not yet been paid by the account debtor, the example transaction used in making the disclosures shall assume the recipient has drawn $10,000.