OUR

SOLUTIONS

INVESTMENT CRITERIA

Aequum provides senior secured structured loans tailored to borrower’s capital needs. In an effort to provide transparency, below are general loan structures and guidelines for Aequum’s target borrower profile

Loan Structure:
Revolving Lines and Term Loans

Loan Amounts:
$5 – $35M+

Tenor:
1 to 3 Years

Spread:
SOFR + 4.5% to 7.0%

Fees:
1.00% to 1.50%

Duration:
1 to 3 Years

Industries:
Preference in Business Services, Wholesale, Manufacturing, Consumer Products, Tech enabled, E-Commerce

Geography:
United States

Other:
Senior Secured, Flexible, Covenant – Lite

Flexible Tailored Funding Solutions

Aequum unlocks value through creative structuring, providing companies with enhanced liquidity to execute on growth, turnarounds, and other initiatives where banks and other traditional lenders fall short.

Asset-Based Revolving Credit(A/R & Inventory)

Asset‑Based Lending (ABL) is a type of revolving credit facility secured by a company’s assets—most commonly accounts receivable and inventory. The amount a borrower can draw is determined by a borrowing base, which is recalculated regularly (often weekly or monthly).

How It Works

  • The lender establishes a credit limit, but the actual amount available depends on the value of eligible assets.
  • As A/R is collected or inventory is sold, availability increases again—making it a true revolving structure.

Hard Asset-Backed Facilities (Machinery & Equipment)

Loans secured by operational equipment such as manufacturing machinery, vehicles, or industrial tools.
 
Key traits:
  • Advance rates based on Net Orderly Liquidation Value (NOLV).
  • Amortization mirrors the useful life of the equipment.
  • Based heavily on third‑party appraisals.
 
Use cases: liquidity, capital expenditures, refinancing, and acquisition financing.

Stretch ABLs & Structured Overadvances

Stretch – Allows companies to borrow beyond what its collateral would normally support. These loans are designed for borrowers who may be “under‑secured” but still have predictable earnings or cash flow. They provide greater liquidity by offering higher advance rates than standard ABL structures.

Structured – Hybrid structure that combines an asset‑based loan with a cash‑flow loan. This allows a company to access more capital than either structure could provide on its own, making it ideal for businesses that either (1) have strong assets but unstable cash flow, or (2) strong cash flow but limited assets. These loans “stretch” the borrowing capacity by blending both collateral‑based and cash‑flow‑based lending

Cash-Flow Supported Special-Situation & Term Loans

Cash‑flow supported term loans are financing structures where the lender relies primarily on a company’s projected or recurring cash flow—rather than hard assets—to secure repayment. These loans are commonly used to provide growth capital, acquisition financing, or working capital for companies whose cash flow is strong enough to support debt but may not have sufficient collateral for traditional asset‑based loans.

Special‑situation term loans are a subset of term loans designed for companies facing non‑standard or event‑driven situations, such as rapid growth, liquidity challenges, turnarounds, restructuring needs, or opportunistic transactions. These loans offer flexible structures, often taking forms such as first‑lien, second‑lien, or unitranche debt, and may be underwritten based on cash flow, collateral, guarantor strength, or recurring revenue—depending on the situation.

Carve-Out Financings & Complex Capital Structures

Carve‑out financing refers to funding that supports a company selling or separating a specific business unit, asset group, or division from its parent organization. It is used in carve‑out transactions—common in M&A—where a business “carves out” non‑core assets to unlock value, streamline operations, or fund growth. Financing may involve senior debt, mezzanine debt, private equity, or leveraged buyout structures, depending on the deal’s objectives
 
Carve‑Out & Complex Capital Structure loans provide flexible, customized funding for businesses undergoing strategic separation, restructuring, or transactions requiring layered, intricate debt arrangements.

Hard Asset-Backed Facilities (Real Estate)​

Loans backed by owned commercial property like plants, warehouses, or offices.

Key traits:

  • Advance rates typically 65–80% of appraised value.
  • Terms 5–20 years, often with balloon payments.
  • Secured by stable, high‑value property assets.
  • Valued through formal appraisals (income, cost, or market approaches).

 

Use cases: long‑term financing, facility upgrades, expansion, or refinancing.