Thursday, October 09, 2014

some words from the March 17, 2012 memo about covenants, commenter at Throckmorton suggests likelihood that MH accounts may be frozen soon. Any corroboration for this?

http://wp.production.patheos.com/blogs/warrenthrockmorton/files/2014/09/Current-Financial-Situation-March-17-12.pdf

So, what does the above table tell us?
1. We are taking in $30.25 per adult and spending $4 7.30 per adult.
2. We will run out of cash in early July.
3. We will be out of compliance with our loan covenants in early June.

If this was a risk back in early 2012 how close has Mars Hill gotten to being out of compliance with any applicable or relevant loan covenants by now?

Well, one "Mars Hill Insida" had this to say earlier today
http://www.patheos.com/blogs/warrenthrockmorton/2014/10/08/petition-asks-evangelical-council-for-financial-accountability-to-suspend-mars-hill-church/#comment-1626220421
Mars Hill is about to have their accounts frozen and the bank is going to take over. All of this is irrelevant at this point.

Follow later by ...

http://www.patheos.com/blogs/warrenthrockmorton/2014/10/08/petition-asks-evangelical-council-for-financial-accountability-to-suspend-mars-hill-church/#comment-1626295140
Wrong. Its called loan covenants. It is what MH is running up against. I don't have to prove anything...you can either believe me or not.

We can establish from the earlier published memo of 2012 that loan covenants were considered a risk factor in Mars Hill's financial situation in the past, so simply mentioning their existence as a variable that could impact financial accounts isn't uncalled for.  While Mars Hill Insida might not have a mountain of docs at the ready to establish that Mars Hill is about to have their accounts frozen the existence of loan covenants has since become a matter of public record.  There may be some speculation afoot here but it's possible for at least some of that speculation to be informed and educated.  We'll see.

Slow news week, obviously, but as Wenatchee The Hatchet has been noticing this year most of the news this year was about stuff that was arranged a few years ago.  If Mars Hill has all of its real estate still cross collateralized into a single loan then any breach of any loan covenants might spell fiscal disaster for the organization, or might it not?  We'll just have to wait and see.

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