Restructuring & $3 Million Credit Facility
The Client
A machining and manufacturing company specializing in tight tolerance CNC machining and welding of large and small manufactured parts. They work with most types of metals, plastics and other manufacturing materials and can help develop and build specialized machinery for most any industry, including defense, science, technology, transportation, high vacuum and the oil industry.
The Situation
After the company had lost two of its major customers to offshore suppliers, they defaulted on their senior conventional credit facility and had five equipment leases in default — three of which resulted in judgments recorded against the business and the company owner’s personal residence. In addition, significant litigation was stacking up with the company’s creditors.
The Solution
Business Capital engaged the company’s lender and every one of its creditors, negotiated permanent reductions and releases of all liens and personal guarantees with every creditor as a condition to funding. The restructuring resulted in slashed cash burn rates of over 60%, positioning the company on stronger footing and allowing for maximization of the new $3 Million credit facility secured by Business Capital.
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