King Trade Capital Is Pleased To Announce The Completion Of A $750,000 Production Financing Facility For A Texas Based Manufacturer (the “Company”)

Friday, June 26, 2015

The Company historically had manufactured customized uniforms for a major commercial customer that made up the bulk of their annual sales.  Unfortunately, in 2014 the client’s end customer made the decision to move production overseas, resulting in a severe reduction in sales, and placed a large strain on cash flow. In the search to fill the facilities underutilized capacity, the Company used its status as a minority owned business to transition into the government sector.

After serving as a subcontractor on several government contracts, the Company displayed the level of quality and performance that directly caught the eyes of government contracting officers. As a result, the Company was awarded its first large direct government contract in March of 2015.

Having maxed out their current credit facility with their regional bank, the Company needed a financial partner to help finance the government contract and repair their balance sheet. Their bank, being familiar with King Trade Capital, introduced KTC as a finance solution to help them fulfill their contract.

King Trade Capital worked with the bank to carve-out the government contract from the bank’s existing collateral in order to allow them to finance the fulfillment of the contract. KTC worked quickly to properly structure an inter-creditor agreement acceptable to the bank. The Client is now producing to fulfill the contract and is operating at close to full capacity. Once the contract is completed, the Client’s balance sheet will be stronger which will directly benefit not only the client but the bank.

King Trade Capital’s ability to quickly structure a production facility to support the funding of raw materials and direct labor costs allowed the Client to produce the goods for the government contract. With a strong financial partner, highly experienced in production and work in process funding for government contracts, the Company is now able to enter into discussions with the government for even larger contracts.