0001539894FALSE00015398942022-10-312022-10-31
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 31, 2022
Atlas Financial Holdings, Inc.
(Exact name of registrant as specified in its charter)
| | | | | | | | | | | | | | |
| Cayman Islands | | 000-54627 | | 27-5466079 |
(State or other jurisdiction
of incorporation) | | (Commission
File Number) | | (I.R.S. Employer
Identification No.) |
| | | | | |
| | | | | |
953 American Lane, 3rd Floor Schaumburg, IL (Address of principal executive offices) | 60173 (Zip Code) |
Registrant's telephone number, including area code: (847) 472-6700
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act: None
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange
Act. o
Item 1.01 Entry into a Material Definitive Agreement.
On October 31, 2022, as contemplated by the previously disclosed Term Loan Commitment, among Atlas Financial Holdings, Inc. (the “Company”), certain of its subsidiaries, as borrowers (collectively, the “Borrowers”), and the lenders party thereto, the Company and the Borrowers entered into Amendment No. 5, dated as of October 31, 2022 (the “Amendment”), to Convertible Senior Secured Delayed-Draw Credit Agreement (as amended by Amendment No. 1, dated February 2, 2022, Amendment No. 2, dated March 25, 2022, Amendment No. 3, dated June 9, 2022, and Amendment No. 4, dated September 6, 2022, the “Credit Agreement” and, as amended by the Amendment, the “Amended Credit Agreement”), with Sheridan Road Partners, LLC, as administrative agent (in such capacity, the Agent”), the lenders party to the Credit Agreement (the “Original Lenders”) and the new lenders party to the Amended Credit Agreement (the “New Lenders” and, together with the Original Lenders, the “Lenders”).
Pursuant to the Amendment, the aggregate principal amount of the term loan facility available to the Borrowers under the Amended Credit Agreement (the “Term Loans”) was increased from $7,200,000 to $7,950,000, with such additional amount to be loaned to the Borrowers by the Lenders as set forth in the Amendment. The $750,000 of additional Term Loans was funded on November 1, 2022 and is expected to be used for general corporate purposes.
The Amendment is filed as Exhibit 10.1 to this Current Report. The description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment filed herewith as Exhibit 10.1 to this Current Report.
Forward-Looking Statements
This Current Report on Form 8-K includes forward-looking statements and information within the meaning of the federal securities laws regarding the Company and its businesses. Such statements are based on the current expectations, estimates, projections, and assumptions made by management. The words “anticipate,” “expect,” “believe,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or similar words are used to identify such forward looking information. The forward-looking events and circumstances discussed in this report may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company, including risks regarding the effects and duration of the COVID-19 outbreak, the insurance industry, economic factors, and the equity markets generally and the other risk factors discussed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and subsequent periodic reports. Many of these uncertainties and risks are difficult to predict and beyond management’s control. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made, and the Company and its subsidiaries undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| | | | | |
| 10.1 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
** Certain portion of this exhibit (indicated by "[*****]") have been omitted pursuant to Item 601(b)(10) of Regulation S-K
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | | | | | | | | | | | | | |
| | | ATLAS FINANCIAL HOLDINGS, INC.
(Registrant) |
| Date: November 3, 2022 | By: | /s/ Paul A. Romano |
| | Name: | Paul A. Romano |
| Title: | Vice President and Chief Financial Officer |
Certain portions of this exhibit (indicated by “[*****]”) have been omitted pursuant to Item 601(b)(10) of Regulation S-K
AMENDMENT NO. 5, dated as of October 31, 2022, to CONVERTIBLE SENIOR SECURED DELAYED-DRAW CREDIT AGREEMENT (as amended by Amendment No. 1 thereto, dated as of February 2, 2022, Amendment No. 2 thereto, dated as of March 25, 2022, Amendment No. 3 thereto, dated as of June 9, 2022, and Amendment No. 4 thereto, dated as of September 6, 2022, and as further amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Atlas Financial Holdings, Inc., American Insurance Acquisition Inc., Anchor Group Management Inc. (“AGMI”), Anchor Holdings Group, Inc, optOn Digital IP Inc., optOn Insurance Agency Inc., Plainview Premium Finance Company, Inc., jointly and severally (collectively, the “Credit Parties”), the Lenders (as defined therein), and Sheridan Road Partners, LLC, as administrative agent for the Lenders (in such capacity, the “Administrative Agent”).
The Credit Parties, the Administrative Agent and the Lenders whose signatures appear at the foot of this Agreement (who include the Requisite Lenders, as defined in the Credit Agreement) hereby agree as follows:
1. Definitions, Etc. All terms used herein, unless otherwise defined, shall have the meanings ascribed thereto in the Credit Agreement. References to “Articles” and “Sections” in this Amendment are references to Articles and Sections of the Credit Agreement. References to “Attachments” are references to attachments to this Amendment No. 5.
2. Purposes. The purposes of this Amendment No. 5 are to provide for (a) an increase in the Total Term Loan Commitment from $7,200,000 to $7,950,000, and (b) the other modifications and supplements to the terms of the Credit Agreement and the other Credit Documents provided for herein.
3. Increased Commitment. Each of the Lenders designated on Attachment 1 as a “Supplementing Lender” shall increase the amount of its Term Loan Commitment by the amount indicated on Attachment 1 ($750,000 in the aggregate). All of the parties acknowledge that the Term Loan Commitments of the Lenders other than the Supplementing Lenders have been fully satisfied and that any Term Loans made from and after the date hereof shall be made solely by the Supplementing Lenders in proportion to their respective Term Loan Commitments set forth on Attachment 1.
4. Amendments.
(a) Total Term Loan Commitment. The definition of the term “Total Term Loan Commitment” in Section 1.1 is hereby amended to provided that the term means the aggregate amount of the Term Loan Commitments as of the date of this Amendment No. 5 which is $7,950,000.
(b) Borrowings. Section 2.2 is hereby amended by revising Section 2.2(c) to read in its entirety as follows:
(c) Delayed Draw and Expansion Loans. During the Availability Period, subject to the satisfaction of the conditions set forth in Article IV, additional Term Loans in the aggregate principal amount of $1,000,000 (“Delayed-Draw Loans”) and, after the Delayed-Draw Loans have been fully funded, Expansion Loans in the aggregate principal amount of $4,950,000 may be borrowed during the Availability Period. All Delayed-Draw Loans and
Expansion Loans shall be made pursuant to a Borrowing Certificate delivered to the Administrative Agent pursuant to Section 2.2(a).
(c) Collateral. The Credit Parties will as promptly as practicable deliver a copy, executed by Fifth Third Bank, National Association (the “Depository Bank”), of the Amendment to Deposit Account Control Agreement by and among certain of the Credit Parties (including AGMI), the Administrative Agent and the Depository Bank heretofore executed by the applicable Credit Parties and the Administrative Agent.
5. Miscellaneous.
(a) Except as expressly provided in this Amendment No. 5, the Credit Documents as in existence prior to the date hereof shall remain unmodified and in full force and effect.
(b) From and after the date hereof, all references to the Credit Agreement in the Credit Documents shall be deemed references to the Credit Agreement as amended and supplemented by this Amendment No. 5.
(c) This Amendment No. 5 is a Credit Document and the provisions of Sections 9.11, 9.14, 9.15, 9.16, 9.19 and 9.20 are incorporated herein by reference adjusted mutatis mutandis so that references to the Credit Agreement shall be deemed references to this Amendment No. 5.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties have caused this Amendment No. 5 to be duly executed and delivered as of the date first above written.
| | | | | |
ATLAS FINANCIAL HOLDINGS, INC., a Cayman Islands exempted company limited by shares By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO ANCHOR GROUP MANAGEMENT INC., a New York corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO optON DIGITAL IP INC., a Delaware corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO UBI HOLDINGS INC., a Delaware corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO | AMERICAN INSURANCE ACQUISITION INC., a Delaware corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO ANCHOR HOLDINGS GROUP, INC., a New York corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO optON INSURANCE AGENCY INC., a Delaware corporation By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO PLAINVIEW PREMIUM FINANCE COMPANY, INC., a Delaware corporation
By: /s/ Scott D. Wollney Name: Scott D. Wollney Title: President & CEO |
[*****]
[Lender Signature Pages Omitted]