SelectQuote amends facility to add incremental, delayed-draw term loans

By Rebecca Melvin

New York, Feb. 24 – SelectQuote Inc. amended its credit agreement on Wednesday to provide incremental and delayed-draw term loans, according to an 8-K filing with the Securities and Exchange Commission.

The amendment to the Nov. 5, 2019 credit agreement provides for a $231,029,411.80 senior secured incremental term loan via new lenders and a $145 million senior secured delayed-draw term loan commitment that may be drawn from time to time subject to certain conditions.

The proceeds of the amended agreement will be used to prepay $84 million of outstanding term loans to a non-consenting lender, to finance permitted acquisitions and investments, to pay transaction expenses and for general corporate purposes.

The existing term loan balance was brought down to $240,882,352.91.

The interest rate on the term loan borrowings is Libor plus 500 basis points, with a 0.75% Libor floor, which represents a reduction from the initial term loan’s pricing of Libor plus 600 bps, with a 1% floor.

In addition, some covenants governing the company’s operating flexibility were changed.

The company entered the amendment with Morgan Stanley Capital Administrators Inc. as administrative agent.

SelectQuote paid a 25-bps consent fee to each of the lenders consenting to the amendment.

The insurance company is headquartered in Overland Park, Kansas.

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