Project Timber was an entity formed to bid at a receivership auction for a lumber manufacturer previously owned by the principal of our client. A stalking horse purchase agreement had been accepted for the lumber manufacturer by the Receiver, subject to higher and better offers. An auction was scheduled three weeks after Project Timber engaged SC&H Capital to support its arrangement for financing to bid on the lumber manufacturer, which included the real property and production equipment at two sawmills and over 250 pieces of field equipment and rolling stock. Without a funding commitment, Project Timber could not qualify to submit a minimum overbid before the deadline and participate in the auction. Lacking meaningful financial statements to demonstrate adequate cashflow, SC&H Capital procured three term sheets from prospective lenders for financing based on the value of the assets to be purchased at the auction. SC&H Capital negotiated with the lenders and was able to generate a loan commitment, qualifying Project Timber to submit a minimum overbid in time to participate in the auction.
