Item 1.01. Entry into a Material Definitive Agreement.
On February 3, 2021, Standard Premium Finance Holdings, Inc., a Florida
corporation (the "Company"), through its wholly-owned subsidiary, Standard
Premium Finance Management Corporation (the "Borrower"), entered into a two year
secured revolving credit agreement with a maximum aggregate borrowing capacity
of $35,000,000 (the "Loan Agreement") with First Horizon Bank (the "Lender").
On October 5, 2021, the Borrower and the Lender entered into a First Amendment
to Loan Agreement which increased the maximum aggregate borrowing capacity under
the Loan Agreement to $45,000,000. The amended Loan Agreement also adjusted the
Borrower's maximum total balance sheet leverage to 3.5 to 1 to be tested as of
the end of each fiscal quarter. All other material terms of the Loan Agreement
remain in full force and effect. The foregoing description of the First
Amendment to Loan Agreement is only a summary and is qualified in its entirety
by reference to the full text of the First Amendment to Loan Agreement, which is
filed as Exhibit 10.1 to the Current Report on Form 8-K filed on October 5, 2021
and incorporated herein by reference.
On November 30, 2022, the Borrower and the Lender entered into a Second
Amendment to Loan Agreement ("Second Amendment"), which extended the maturity
until November 30, 2025. The Second Amendment also changed the index rate of the
loan from one-month LIBOR to one-month SOFR in anticipation of the retirement of
published LIBOR rates in 2023. The Second Amendment changed and simplified the
calculation of the Minimum Interest Coverage Ratio. The Second Amendment
favorably removed the Minimum Required Subordinated Debt of $8,500,000 and
instead requires a total Minimum Tangible Net Worth of $13,500,000. The
definitions within Acceptable Receivables were changed to include Insurance
Company Receivables of 120 days or less, and a maximum Insurance Company
Receivables of 10% of Acceptable Receivables, among other minor changes. The
Applicable Margin above the index rate was favorably changed to allow for
reductions in the Applicable Margin based on the Company's Ratio of Total
Liabilities to Tangible Net Worth. All other material terms of the Loan
Agreement remain in full force and effect. The foregoing description of the
Second Amendment to Loan Agreement is only a summary and is qualified in its
entirety by reference to the full text of the Second Amendment to Loan
Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and
incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
10.1 Second Amendment to Loan Agreement between Standard Premium
Finance Management Corporation and First Horizon Bank dated November
30, 2022.
104 Cover Page Interactive Data File (formatted as Inline XBRL and
contained in Exhibit 101)
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