Shimmick Corp Secures $15M in Loan Agreements

Shimmick Corporation (NASDAQ:SHIM), a Delaware-incorporated heavy construction company with a market capitalization of $56.7 million, has entered into a material definitive agreement, securing a $15 million loan to bolster its financial flexibility. The loan, provided by an affiliate of Ansley Park Capital LLC, was finalized on March 31, 2025, according to the company’s recent SEC filing. InvestingPro data reveals the company has been quickly burning through cash, with a concerning current ratio of 0.61, indicating potential liquidity challenges.

The Irvine, California-based Shimmick Corp, operating under the SIC code for heavy construction contractors, has disclosed the terms of the loan through its wholly-owned subsidiaries. The loan is structured as two promissory notes, each contributing to the total borrowing capacity, and is intended for project expenses and general corporate purposes. According to InvestingPro analysis, which offers 12+ additional insights about the company’s financial health, SHIM’s short-term obligations currently exceed its liquid assets.

These promissory notes carry a maturity date of April 1, 2031, with an interest rate of 12.50% per annum. In case of default, as outlined in the loan agreement, the lender is entitled to an increased interest rate of 2.0% above the standard rate. The agreement also allows the lender to demand immediate payment following any default, subject to certain cure periods.

As collateral for the loan, Shimmick Corp has pledged specific items of equipment, related leases, rental contracts, chattel paper, accounts, security deposits, general intangibles, and any subsequent proceeds. The loan agreement includes typical affirmative and negative covenants consistent with such financial arrangements.

Furthermore, Shimmick Corp and one of its wholly-owned subsidiaries have each entered into a separate guaranty agreement, unconditionally assuring the liabilities of the borrowing entities under the loan agreement.

This financial move comes as part of Shimmick Corp’s strategy to support its ongoing projects and maintain corporate liquidity. The company, previously known as SCCI National Holdings, Inc., has made this information public through the mandatory 8-K filing with the Securities and Exchange Commission.

Investors and stakeholders can review the complete details of the loan and security agreement, the forms of the promissory notes, and the guaranty agreements in the exhibits attached to the 8-K report. These documents offer a comprehensive view of the terms and conditions governing the new financial obligations undertaken by Shimmick Corporation.

In other recent news, Shimmick Corp reported a notable earnings miss for Q4 2024, with an earnings per share (EPS) of -0.91, significantly below the forecasted 0.11. The company’s revenue also fell short, coming in at $104 million compared to the expected $173.7 million. Despite these challenges, Shimmick maintains a strong project backlog of $822 million, which could indicate potential future growth. The company is focusing on expanding its electrical infrastructure and improving project margins, forecasting a 10-15% revenue increase in 2025. Additionally, Shimmick aims for a gross margin of 9-12% in the upcoming year. In terms of analyst activity, there were no specific upgrades or downgrades mentioned, but the company continues to attract attention with its strategic initiatives. CEO Yirael Yal expressed confidence in the company’s future, citing strong client relationships and a solid foundation as key growth drivers.

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