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Financing Challenge:
A small publicly traded company was seeking a Revolving Line of Credit. In August 2007, the Company simultaneously purchased an operating company and became a public company through a reverse merger into a public shell. The Company imports and distributes high-end specialty food products to prominent restaurants and hotels throughout the country.

Although the Company has annualized sales of $5 million, it operating losses since inception totaled $1.5 million.

The Company directly approached a number of banks and non-traditional lenders but was turned down by all. The Company was advised to factor its accounts receivable but chose not to do so because it also needed to borrow funds against the value of its inventory.

The Company's inventory was equal to the amount of its receivables. Not being able to borrow against the value of its inventory would adversely affect the Company's working capital.

Creative Financing Solution:
The Company was introduced to Asset Enhancement Solutions, LLC ("AES") and retained AES to arrange a Line of Credit that would include advances against inventory.

AES contacted its financing sources that specialized in high-risk transactions but was turned down by all except one.

Despite the Company having cumulative operating losses of $1.5 million, and not having reported a profitable quarter for 9 months, AES was successful in arranging a $750,000 Revolving Line of Credit with advances against inventory at 50% and advances against receivables at 85%.

This Line of Credit provided the Company with the financing mechanism it needs to achieve its 2009 objectives.

Neil Seiden, 516-767-0100

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