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Company Type:
-- Site Prep Contractor
Location:
-- Western USA
Background:
In business since 2004, the company is both a vertical and horizontal home builder.
In addition to custom building, they specialize in subdivision site preparation, moving dirt, installation of utilities, pouring foundations, and more.
Cash strapped, this site prep contractor was past due on equipment rental payments and had an outstanding tax lien, but they also had a significant amount of contracted future work. They needed to purchase equipment to continue operations.
Situation
Payment Delays Result in Poor Cash Flow and Missed Rental Payments
The customer was under contract to work on 192 lots but was experiencing a delay in payment for work previously performed. As a result, they were past due on payments for equipment on rent from the local equipment dealer, past due on payments for financed equipment, and had some outstanding tax liens. The customer also needed money for short-term operations while they waited for their accounts receivable to pay.
They needed a lender that would:
- Realize the value of their existing contracts
- Understand the reasons causing their current situation
- Recognize the value in their existing equipment
They also needed the transactional expertise to payoff existing debt and obtain working capital to continue operation.
Refinance of Existing Equipment Provides Working Capital to Payoff Outstanding Debts
CCG structured a loan that accomplished the following:
- Used free and clear collateral to pay off tax lien and provide a working capital loan for operations
- Converted the rented equipment into a purchase (paying all past due rentals)
- Refinance the debt and equipment with their existing lender with a payment plan that was consistent with their cash flow
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