An electronic components manufacturer in Grafton, WI was asked to leave its bank because of historic losses and a deficit net worth. The manufacturer was referred to Bellwether Funding, LLC by its prior banker, and BWF quickly reviewed the challenging loan circumstances. After a cursory review, we offered a viable solution to solve several inherent problems uncovered:
- The owner had deferred compensation and notes payable to himself which that were not structured on the balance sheet by the accountant. By restructuring the debts, and subordinating the debts to the bank, we resolved this deficit net worth issue.
- The borrower had a casualty loss from ice damage to the roof that was only partially covered by its insurance carrier. Despite some minor repairs, the roof continued to leak and needed to be replaced. The new loan was structured with a construction line of credit to pay the balance of the funds needed to fund the roof replacement, using the equity in the company’s inventory and equipment.
- A prior partner had a liability on the balance sheet which needed to be settled prior to refinancing. BWF recommended the release of debt by exchanging a parcel of excess land adjacent to the manufacturing facility for the outstanding buyout debt owed to the former partner.
The result was an $880,000 loan package guaranteed by the SBA which paid out the prior bank in full and funded the roof replacement and other needed facility repairs. The borrower stated after closing, “Well done, and thanks for your hard work!”
How can Bellwether Funding help you with your refinancing needs? Call us today at 262-567-3980 to find out!