Term Sheet for $5,000,000 Revolving Line of Credit between Positive Physicians Holdings and LegacyTexas Bank

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Summary

Positive Physicians Holdings (PPH) and LegacyTexas Bank have outlined preliminary terms for a $5,000,000 revolving line of credit. The loan is intended for general corporate purposes, with a five-year maturity and interest-only monthly payments, with principal due at maturity. The interest rate is variable, and the loan is secured by a first lien on all assets of PPH and stock of Positive Physicians Insurance Company. Financial covenants and regular financial reporting are required. This term sheet is not a binding commitment but an initial indication of terms, subject to further approval and due diligence.

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EX-10.13 23 pphis1exhibit1013.htm EXHIBIT 10.13 Exhibit
Exhibit 10.13

TERM SHEET
September 10, 2018
Borrower(s):
Positive Physicians Holdings (PPH)
Lender:
LegacyTexas Bank
Loan Amount and Type:
$5,000,000 Revolving Line of Credit
Purpose:
General Corporate Purposes
Maturity:
5 years
Repayment:
Interest-only monthly with Principal due at maturity.
Pricing:
Variable 1 Month Libor + 2.75%, or WSJP + 0.0%
Fees:
25 bps unused
Guarantors:
Any existing or future material subsidiaries of the Borrower.
Collateral:
First lien security interest in: All assets of Borrower, Stock of Positive Physicians Insurance Company (PPIC).
Financial Covenants:
To be customary with facility type and use, and may include the following: Minimum Total Adjusted Capital and RBC Ratios for Insurance Companies, Minimum Fixed Charge Coverage Ratio, Maximum Total Leverage Ratio, and Minimum Liquidity Maintenance Agreement.
Reporting:
Financial reporting will include, but will not be limited to the following: Annual and Quarterly financial statements of Borrower and Insurance Companies.
Other Fees:
Borrower is responsible for all related closing costs including, but not limited to, documentation preparation fees, filing fees, and any other due diligence or closing costs deemed necessary by lender including bank’s reasonable attorney’s fees.
This term sheet is for discussion purposes only. This is not a commitment to lend, but rather an indication of the terms and conditions of a loan(s) that LegacyTexas Bank, (“Lender”) would consider providing to you for the requested financing.  The following loan parameters should be regarded as preliminary and are subject to change based upon further underwriting, subsequent Lender approval and receipt and review of all due diligence information, including third party reports, as well as site inspections of any property and/or collateral, all of which must be acceptable to the Lender in its sole discretion. This letter does not purport to summarize all of the conditions, covenants, representations, warranties, and other provisions that would be contained in definitive legal documentation.