[BCLLC]

I have a client who sold his company for $4.8 million over a year ago.

Instead of taking a lump sum for the sale, it is structured as a consulting agreement that goes until 2025. The way that it is structured is he is paid $24k/month for the first 18 months, $40k/month for the next 60 months, and $46k/month for the last 60 months. The current balance is approx $4 million.

The agreement is with an aerospace company that has been in business for over 50 years. The agreement has no requirements. He just collects the payments and sits on the board of directors.

The client is looking to either transfer the payments to someone else and receive a discounted lump sum or borrow against the agreement. Funds will be used for a new business venture.

I realize this is outside the box but any ideas?

Thanks

[NickHubbard]

Just sent you a PM

[Kevin Henry-Seacoast]

You may want to seek settlement funding companies. There are a few in Florida. Client First Settlement Funding in Boca. The other route would be speaking with a wealth manager that would be willing to lend vs. his earn-out.

[bdshaw]

Hi everyone- Kevin's idea is great, however. I may have a different solution. In the past I have financed deals like this by discounting a portion of the payments and leaving the balance for your client to either collect or discount at a later time. Right now the time value of the last 60 months are low compared to the first 60 or 75.
You may not want to mention the name of the aerospace company here but it would be quite helpful if you could give us their bond rating. That will give us a very good idea of their worthiness. When I say we I mean the whole board.
Bob Shaw
734-929-3800
rshaw@advancecredit.com