Financing Challenge:
A Food Trading Company with a Revolving Asset Based Credit Facility had problems with its existing lender. Communications between the Company and the lender deteriorated. The lender insisted on tedious additional weekly and monthly reports that were expensive for the Company to produce as they outsourced their financial management function to their CPA firm. The request for additional information became onerous and very expensive. The lender serviced the Company from two locations, its Corporate Headquarters and a satellite office. These logistics only exasperated communication problems as duplicate requests for the same information became the norm.

Creative Financing Solution:
Asset Enhancement Solutions, LLC (AES) arranged financing with an Asset Based Lender servicing the Company from one central location. The lender made sure the Company was comfortable with the Account Team that would be working with it on a day to day basis. The Company and the lender agreed on standard reports acceptable to both parties resulting in significantly less work and lower fees from its CPA firm. Not only did communications improve, but financing costs were lowered as the new lender reduced the basis points it charged above the LIBOR rate by 10%. The new lender also gave the Company an additional term loan to cover the penalties it paid to terminate its previous loan prior to maturity as well as subsidize the closing costs incurred for the new line of credit.

Contact
Neil Seiden, 516-767-0100
neil.seiden@assetenhancement.com

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