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Ares Commercial Finance announced today that it has provided a $30 million senior secured credit facility to Monolith Brands Group, Inc. (“the Company”).  The Company is a consumer products platform focused on acquiring omnichannel brands in niche product categories. Proceeds of the credit facility will be used to refinance existing indebtedness, provide ongoing working capital and help fund future acquisitions.

Encina Business Credit, LLC (“EBC”) announces the completion of a $75.0 million revolving credit facility for Horizon Global Corporation (“Horizon”). The facility will be used to replace an existing facility and will provide for ongoing working capital.

A recent Supreme Court case and related law changes in many states have resulted in significant new state sales tax obligations on many SaaS providers. It’s important to understand that these changes could result in new tax collection responsibilities on your business even in states where you have operated without them in the past.

Executives need to act quickly to make sure that their existing operations are in compliance with the new rules and that their systems can adapt as sales growth and law changes trigger additional obligations.  

From the second quarter Phoenix Management “Lending Climate in America” survey results reveals optimism in the U.S. economy with results for the near-term economy exceeding pre-pandemic predictions for the first time since the country shutdown due to COVID.

Since reaching an 11-year record low in Q2 2020, confidence in the near-term economy (next 6 months) has steadily climbed quarter over quarter to a 2.79 weighted average GPA in Q2 2021. Additionally, lender confidence in the U.S. economy in the long-term increased (by 7 percentage points) to 2.36 from the previous quarter’s results of 2.29.

PNC Bank, National Association, announced today the closing of a $42.38 million senior secured credit facility for Madison-Kipp Corporation (MKC), a portfolio company of Dallas, TX-based Trive Capital. PNC Bank, N.A., served as administrative agent.

Encina Business Credit, LLC announced today that it has provided a $30 million senior secured revolving credit facility to an e-commerce retailer.

The senior secured revolving line of credit, which is collateralized by accounts receivable, credit card receivables, and inventory, was used by the company’s private equity investor to finance its acquisition and ongoing working capital financing needs.

On March 27, 2020, Congress approved the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”).  The CARES Act includes extensive provisions to address the current public health crisis, including, among other things, $349 billion of commitments for general business loans under Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) through June 30, 2020 under Title I of the CARES Act, titled “Keeping American Workers Paid and Employed Act,”  which sets out the terms for the “Paycheck Protection Program.”

The Paycheck Protection Program has been of particular interest to members of Secured Finance Network because it provides potential interim financing for small businesses that are typical borrowers from many member lenders.

Following up on the description in the articles above here are answers to some frequently asked questions from members of the Secured Finance Network.

SLR Business Credit announced it provided a $2,500,000 asset-based revolving line of credit to a producer of high-quality fresh and frozen meat.

When a group of investors with industry experience found the opportunity to purchase a Midwest producer of high-quality fresh and frozen ground meat out of bankruptcy via a 363 sale, they turned to their community bank.

Santander Bank announced that it closed the following deals:

•            A $142 million deal with WEX Inc., a ME-based financial technology service provider. The deal will support WEX Inc.'s acquisitions of Noventis, a provider of bill and invoice payment delivery, and Discover Benefits, a provider of employee benefits administration.

•            A $120 million deal with The Eastern Company, a CT-based industrial metals products manufacturer. The deal will support The Eastern Company's acquisition program and aid in its purchase of Big 3 Precision Products, Inc., a turnkey packaging solutions provider. 

The Q3 2020 Asset-Based Lending Index reflects improving confidence for lenders, fears of a double-dip downturn subsiding, and exhibits the continuing impact of PPP funds distributed in April. The U.S. economy rebounded during Q3 as lockdowns subsided, leading to a GDP surge of 33%.

This growth had a clear impact on portfolio health with non-accruals, special mention, and write-offs reducing quarter over quarter.

TSL: Congrats on your 10-year anniversary! Scott, what would you say are the biggest changes Gibraltar Business Capital has undergone over these last 10 years?

Scott Winicour: Thanks! It’s been a wild ride these last ten years, but probably the biggest change is when I bought the company from my father ten years ago with the help of private equity. It was a very small, regional player in the factoring space that did average-sized deals of $50,000 to $250,000. One of the biggest changes today is we don’t really do any factoring anymore, and that’s because we’ve morphed into an asset-based lender as opposed to a more traditional factor.  Another big change is that we now have a nationwide presence.  So, we went from a small, localized factoring-only business to a national brand name that people know, with salespeople all across the country. That is, by far, the biggest change.

People's United Bank, N.A. a subsidiary of People's United Financial, Inc. (NASDAQ: PBCT), has expanded its Commercial Specialty Business with the formation of a dedicated Lender Finance team. The team will be led by Patrick Lee, Managing Director, Head of Lender Finance, Asset-Based Lending, and be an extension of the Bank’s existing Asset-Based Lending group.

Two months ago we discussed the questions that lenders should be asking their borrowers as borrowers were beginning to finalize their June 30, 2020 results and report the initial impact of the Covid shutdown and the CARES Act program funds. With the end of August around the corner, the second quarter results and even July 2020 results are available.

It is time to consider updating and expanding discussions with borrowers looking toward the remainder of 2020.

The outline of questions is a guideline to facilitate a discussion focused on the thought processes the business is going through and the financial impact over the past few months and into the future. Open ended questions that encourage a discussion are the most important tools lenders can use to understand their borrowers and the impact of the Covid-19 situation.

D.A. Davidson & Co. acted as financial advisor to Pacific Premier in the transaction and delivered a fairness opinion to the Board of Directors of Pacific Premier. Holland & Knight LLP served as legal counsel to Pacific Premier. Piper Sandler & Co. acted as financial advisor to Opus and delivered a fairness opinion to the Board of Directors of Opus. Sullivan & Cromwell LLP served as legal counsel to Opus.

This is a new feature providing advice from WISF members to young professionals on a specific topic.  We need your input.  If you have a question you would like to see answered in this column, please submit to Michele Ocejo at mocejo@sfnet.com.

Dear WISF,

“Once you are established within a job and/or have already experienced some degree of internal growth, what additional steps would you recommend to continue career growth and development? Early in the career, there are multiple paths and opportunities an early career individual can pursue.  However, once in the mid-level, the continued growth opportunities may not be as bountiful.”

MUFG Union Bank today announced that Anvar Hodjaev has been named Head of Healthcare for its Commercial Banking division. Based in Los Angeles, he will lead the bank's Healthcare industry team and report to Adam Feit, Managing Director and Head of Financial Sponsors, Healthcare, and Life Sciences.

"Anvar brings a wealth of experience and expertise to a crucial business for MUFG Union Bank," Feit said. "As half of our lending commitments come from industry specialties, we continue to lean into our ability to leverage the combination of both local coverage and specialized industry expertise in critical individual sectors for our clients."

First Eagle Alternative Credit, LLC (“First Eagle” or the “firm” ) today announced that it has added asset-based lending solutions to its direct lending platform and appointed industry veterans Larry Klaff and Lisa Galeota to lead this initiative at the firm.

Klaff and Galeota join First Eagle from Gordon Brothers Finance Company, a majority-owned portfolio company of BlackRock Capital Investment Corporation, where they worked together and at its predecessor firm for over 13 years. During that time they sourced, originated and structured asset-based facilities valued at over $1 billion across a wide variety of industries. They will be based at First Eagle’s Boston office and will report directly to Chris Flynn, President of First Eagle Alternative Credit.