Educational Boards

school

$2,000,000

Accounts Receivable Line of Credit and Purchase Order Facility

Distributor of Educational Boards

The Company was founded in 2006 and is headquartered in South Alabama. The Company is primarily a reseller/distributor of Promethean Educational Boards mainly in Mississippi and Arkansas. The Company’s key customer base are educational institutions ranging from K-12 public and private school systems to four year universities.

The Company’s former loan officer approached Southeastern about the Company’s current growth and need for additional working capital. The Company had a current working capital facility with a regional bank, but needed an increase in their existing line due to growth, the seasonal nature of the business, and a slow paying customer base. After their current Bank declined a request for an increase in their line of credit, the Company’s former loan officer put the Company in contact with Southeastern.

After review of the financial package and discussions with the Company, their accountant, and the manufacturer of the Educational Boards, it was determined there was sufficient collateral (A/R) available to support an increase in the current line of credit. However, due to the seasonal nature of the Company’s business, it was determined that the Company needed a facility to accommodate the seasonal increase in sales. After further review of the Company’s cash flow cycle, both Southeastern and the Company felt that a Purchase Order facility would suit the Company best.

Result

• The Company’s former loan officer was able to help a former customer and therefore obtain a new customer relationship along with the opportunity to provide the operating line once the bank is ready.

• The Company was able to get the additional working capital needed to handle positive growth in 2010 and to pursue additional business.

• Due to the slow paying customer base coupled with the large increase in orders experienced during the 3rd and 4th quarters of each year, the Purchase Order facility allows the Company to fulfill their current commitments in addition to the ability to go after additional business.

• The Company gains a lending partner that is able to handle the rapid growth.

• The Company is not locked into any type of contract or long term commitment. Once the referring Bank is ready to assume the operating line, the Bank simply pays off Southeastern without any type of penalty to the Company.