Overcoming Milestone Billing To Seal a Deal

The Company
This is a North Carolina-based distributor of fixtures for the commercial building space. It has three owners; two based in North Carolina and one based in the Company’s Utah office.

The Situation
The business had a small bank line but having seen considerable growth over the past year and a half, was seeking a larger line. A third-party consulting firm referred the owners to Celtic Capital. The hurdle for us was overcoming contract issues as once in audit, we found the Company had milestone billings that we would be unable to lend against.

The Solution
Upon discussing with the owners why milestone billing was an issue and providing them with a solution so that we could move forward, the owners acted on our idea and changed the language of their contracts. We then established a $1,000,000 Accounts Receivable Line of Credit which was used to pay off the bank, catch the owners up on some past due taxes and provide the working capital needed to fund future growth.

The Result
Sales are trending up and now that the Company has the excess availability to manage its growth, the outlook is positive for 2022 and beyond.

About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.

As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.

If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.