SelectQuote(SLQT) - 2025 Q2 - Quarterly Results

Financial Transactions - The Borrower has received not less than $350,000,000 in cash proceeds from the sale of preferred stock[10] - The Borrower will prepay Term Loans in an aggregate principal amount of $260,000,000 on the Twelfth Amendment Effective Date[11] - The Borrower has entered into a Senior Preferred Stock Purchase Agreement dated February 10, 2025[10] - The company secured a $425 million senior secured term loan facility and a $75 million senior secured revolving credit facility[67] - Proceeds from the term loans will be used for specified equity payments totaling up to $325 million, funding cash to the balance sheet for at least two years of interest payments, and general corporate purposes[68] - The company has drawn $145 million from the first amendment incremental term loans and established a delayed draw term loan commitment of $145 million, which has been fully drawn[69] - The second amendment included a fully drawn delayed draw term loan A commitment of $100 million and an undrawn term loan B commitment of $100 million[70] - The aggregate amount of revolving loan commitments was increased to $135 million following the third amendment[71] - Following the fourth amendment, all second amendment delayed draw term loan B commitments were terminated, and the aggregate amount of revolving loan commitments was reduced to $100 million[72] Loan Agreement Conditions - The amendments to the Credit Agreement will become effective upon satisfaction of specified conditions[9] - The Borrower must ensure that no Default or Event of Default has occurred prior to the effectiveness of the amendments[9] - The Administrative Agent will receive a written opinion from counsel for the Credit Parties as part of the conditions for effectiveness[11] - The Borrower must provide incumbency certificates and good standing certificates as part of the conditions for effectiveness[12] - The effectiveness of any Extension Amendment is subject to the satisfaction of specific conditions, including solvency and no existing defaults[161] - The Borrower must provide an Extension Request at least five Business Days prior to the response date for Lenders[159] - No Event of Default shall have occurred at the time an Extension Request is delivered to Lenders[158] - The Administrative Agent must receive a solvency certificate from the Borrower's chief financial officer prior to closing[166] Compliance and Obligations - The Borrower must comply with all Requirements of Law to avoid Material Adverse Effects[183] - The Borrower has no pending litigation that would reasonably be expected to have a Material Adverse Effect[186] - The Borrower must ensure compliance with representations and warranties as of the borrowing date, maintaining material accuracy[175] - No Default or Event of Default should occur as a result of the Loan or Letter of Credit obligations[176] - The Borrower must maintain a minimum Asset Coverage Ratio of 2.35:1.00 for January 31, 2025, following the sale of Non-Core Assets[178] - The operations of each Credit Party and its subsidiaries are in compliance with all applicable Environmental Laws, with no pending or threatened violations[195] - As of the Closing Date, the Borrower and its subsidiaries are solvent[196] - There are no strikes or work stoppages involving any Credit Party or its subsidiaries that would have a Material Adverse Effect[197] - Each Credit Party and its subsidiaries own or have the right to use all necessary Intellectual Property for their business operations[199] - As of the Closing Date, no Credit Party or its subsidiaries have any outstanding equity interests that are subject to liens other than permitted liens[200] Payment and Interest Terms - The Term Loan and Revolving Loans bear interest at a rate equal to Adjusted Term SOFR or the Base Rate plus the Applicable Margin[88] - Interest on each Loan is paid in arrears on each Interest Payment Date, with specific provisions for past due amounts[89] - The Borrower must pay an Unused Commitment Fee of 0.50% per annum on the daily balance of the Aggregate Revolving Loan Commitment, less the sum of all Revolving Loans and Letter of Credit Obligations[130] - Upon termination of all Revolving Loan Commitments, the Borrower shall pay a fee of $500,000 to the Revolver Agent[133] - A prepayment premium of 1.0% will be applicable if the Borrower makes a voluntary prepayment of Term Loans before specified termination dates[135] - The Borrower must pay all amounts due without set-off or deduction, and payments must be made in immediately available funds by 2:00 p.m. New York time[136] Borrowing Procedures - The Borrower must deliver a duly executed Notice of Borrowing to the Applicable Agent[176] - The Borrower must provide written notice for each Revolving Loan borrowing, which must be received by the Revolver Agent before 3:00 p.m. on the requested date[99] - The proceeds of each requested Borrowing will be promptly made available to the Borrower by deposit into its operating account[100] - The Borrower has the option to convert or continue loans as SOFR Loans, with a minimum amount of $250,000 required for such elections[102] - The Borrower may prepay Revolving Loans in whole or in part without penalty or premium[105] - Any prepayment of Term Loans must be in amounts greater than or equal to $100,000, with prior written notice required[106] - The Borrower can permanently reduce the Aggregate Revolving Loan Commitment by at least $500,000, with reductions allocated pro rata among all Lenders[107] - The Borrower is required to prepay an aggregate principal amount of Term Loans equal to 50% of Excess Cash Flow for the Excess Cash Flow Period, minus voluntary prepayments made during that period[121] Financial Reporting - The Borrower provided audited consolidated financial statements for the fiscal year ended June 30, 2019, including balance sheet and cash flow statements[173] - The unaudited consolidated profit and loss statements for July and August 2019 were also delivered[173] - The audited consolidated balance sheet for the fiscal year ended June 30, 2019, presents a fair view of the financial condition of the Borrower and its subsidiaries[192] - Since June 30, 2019, there have been no events that could reasonably be expected to have a Material Adverse Effect[193] - All financial performance projections have been prepared in good faith, acknowledging that actual results may vary significantly from these projections[194] Legal and Jurisdictional Provisions - The agreement includes a waiver of personal service for legal processes, allowing service by mail to specified addresses[25] - Each party consents to non-exclusive jurisdiction, permitting legal proceedings in various jurisdictions[26] - The parties waive the right to a jury trial in any actions related to the agreement[27] - The agreement includes provisions for the treatment of unknown claims and defenses[34] - The agreement reaffirms all payment and performance obligations under existing loan documents[30] - Each Credit Party releases claims against the Administrative Agent and Lenders related to the Loans and Loan Documents[31] Loan Modifications and Amendments - The agreement has undergone multiple amendments since its original date, with the latest being the Twelfth Amendment[49] - The transactions are treated as a "significant modification" of existing Term Loans for tax purposes[37] - New Term Loans will be treated as issued in "registered form" for tax purposes[38] - The exchange of Term Loans is treated as a "recapitalization" under U.S. tax law[40] - Non-Funding Lenders do not have voting or consent rights under Loan Documents[151] - Non-Funding Lenders will not earn or receive their portion of the Unused Commitment Fee during the period they are classified as such[155] - The Aggregate Excess Funding Amount for a Non-Funding Lender includes all unpaid obligations and Letter of Credit Obligations reallocated to other Lenders[154] - Each Applicable Agent is authorized to use cash collateral to pay the Aggregate Excess Funding Amount on behalf of Non-Funding Lenders[153]