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If it is a start-up
(defined as less than one full calendar year of operations), then one
year of St. Cloud's Mortgage debt service must be pledged as
additional cash collateral, or the borrower must demonstrate the
capacity to service at least 50% of the combined debt service from
another direct source.
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The borrower must
inject a minimum 20% equity of actual hard project costs PLUS working
capital and inventory. Amounts due vendors, suppliers, broker, or
seller are not included in the 20%. Verification and evidence of the
required cash equity and its source (non-borrowed) must be determined
prior to loan approval.
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St. Cloud Mortgage
loans has a maximum LTV of 50% of the lesser of cost or appraised
value.
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St. Cloud Mortgage
collateral must include a first position UCC-1 financing statement and
security agreement on all FF&E.
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The borrower must have
owned and operated (materially participated) a gas-station/c-store or
truck stop within the last five (5) years.
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St. Cloud Mortgage loan
amount cannot exceed $2 million.
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There is a strong
preference for national brands.
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Consider common market
valuation methods: 3.5x gross profit and/or 15% cap rate on NOI.
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The interest must be a
variable rate tied to prime (par rate of at least P+1%).
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If it is a purchase of
an existing property with an operating history, St. Cloud Mortgage
must receive a copy of the sellers tax returns to verify revenues and
gross profits.
