Kemper lowers pricing on amended $225 million revolver, now due 2020

By Toni Weeks

San Luis Obispo, Calif., June 8 – Kemper Corp. amended and restated its credit agreement on June 2 with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

As with the previous agreement, the credit agreement provides for a $225 million, five-year revolving credit facility. The previous facility was set to expire March 7, 2016.

The amended and restated agreement includes an accordion feature to expand the facility up to $300 million during the term, which will now expire on June 2, 2020.

Proceeds may be used for general corporate purposes, including the repayment of debt.

As of closing, no borrowings were outstanding under the original agreement or the amended and restated agreement.

The amended and restated credit agreement contains covenants generally consistent with those in the original agreement, with revisions to several covenants and other provisions, including the following changes:

• Cross default threshold for defaults in other material indebtedness was increased to $100 million from $75 million, and the default threshold for judgments was increased to $100 million from $75 million;

• Permitted indebtedness owed pursuant to Federal Home Loan Bank borrowings was increased to $500 million from $250 million;

The definition of required lenders was decreased to lenders holding more than 50% of all loans and revolving commitments from lenders holding more than 66 2/3% of all loans and revolving commitments;

• Combined facility fee and borrowing rates were lowered by 12.5 basis points. The interest rate is Libor plus 105 bps to 135 bps, and the facility fee rate varies from 20 bps to 27.5 bps. Both are based on leverage;

• Provisions were added to enable loans to be denominated in euro, pound sterling or Canadian dollars or in U.S. dollars, and to determine interest rates with references to either the Libor rate or Alternate Base Rate, plus the applicable margin;

• The aggregated letter-of-credit facility exposure limitation was reduced to $15 million from $25 million; and

• The section on swingline loans was deleted, removing the $20 million limitation on same-day borrowing for loans denominated in U.S. dollars and accruing interest based on the Alternative Base Rate.

Wells Fargo Bank, NA and Fifth Third Bank are co-syndication agents. J.P. Morgan Securities LLC and Wells Fargo Securities, LLC are joint bookrunners and joint lead arrangers.

Kemper is a diversified insurance holding company based in Chicago.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.