Tiptree’s Fortegra South Bay units get three-year $125 million revolver

By Wendy Van Sickle

Columbus, Ohio, Oct. 11 – Tiptree Inc. subsidiary Fortegra Financial Corp.’s South Bay Financial Corp. and South Bay Funding LLC subsidiaries entered into a three-year $125 million secured revolving credit agreement on Oct. 6, according to an 8-K filing with the Securities and Exchange Commission.

Fifth Third Bank, NA is the bookrunner, lead arranger and administrative agent.

The credit agreement provides for a $20 million revolver with a $2 million sublimit for swingline loans available to South Bay Financial and a $105 million revolver with a $5.5 million sublimit available to South Bay Funding, in each case subject to a borrowing base.

At the borrowers’ election, no later than 30 days prior to the maturity date, the borrowers may request that the total principal amount of revolving loans be converted into a term loan with a maturity date 364 days after the revolving loans’ maturity date and quarterly amortization payments.

Borrowings bear interest at term SOFR plus 275 basis points. There is an undrawn commitment fee of 25 bps.

Financial convents include a minimum interest coverage ratio of 2.0 to 1.0 and a maximum tangible net worth ratio of 5.0 to 1.0.

Proceeds may be used to refinance existing debt, for capital expenditures, for working capital and other general corporate purposes.

Tiptree is a New York-based company that provides insurance and insurance services, real estate, asset management and specialty finance services.

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