Neptune Insurance Holdings Inc.NP
Neptune Insurance Holdings Inc. Debt Disclosure
Debt
Debt consists of the following as of December 31:
| (In thousands) | 2025 | 2024 | |||||||||
| 2024 Term Loan | $ | - | $ | 135,000 | |||||||
| 2025 Term Loan | - | - | |||||||||
| Total debt | - | 135,000 | |||||||||
| Less: unamortized deferred financing fees | - | (1,349) | |||||||||
| Less current maturities of debt | - | (8,550) | |||||||||
| Debt, net | $ | - | $ | 125,101 | |||||||
| Revolving credit facility | $ | 240,000 | $ | - | |||||||
Amended and Restated Credit Agreement
On May 8, 2023, the Company amended and restated its prior credit agreement entered into during 2021 (“2023 Amended and Restated Credit Agreement”) in its entirety with its existing lender, increasing its borrowing base on the term loan to $190,000 (“2023 Term Loan”) and providing access to incremental loans and a revolving line of credit of $10,000. During the year ended December 31, 2024, and prior to the refinancing on June 13, 2024, the Company made aggregate principal repayments of $4,475.
2024 Credit Agreement
On June 13, 2024, the Company entered into a credit agreement (“2024 Credit Agreement”) comprised of a $171,000 term loan (“2024 Term Loan”) and a revolving line of credit commitment of $10,000 (“2024 Revolver”) as well as access to incremental loans. The Company used the proceeds from the 2024 Term Loan in part to pay down the remaining balance of the 2023 Term Loan under the 2023 Amended and Restated Credit Agreement. A loss on extinguishment of debt of $5,346 was recognized in the consolidated statements of income during the year ended December 31, 2024, related to the pay down of the 2023 Term Loan, consisting of the prepayment penalty of $1,741 and the write-off of unamortized deferred financing fees of $3,348 and deferred financing asset of $257.
During the year ended December 31, 2025, and prior to the refinancing on April 10, 2025, the Company made aggregate principal repayments of $4,000. During the year ended December 31, 2024, the Company made aggregate principal repayments of $36,000. The Company recorded amortization expense of $111 and $556 for the years ended December 31, 2025 and 2024, respectively. Interest expense related to the 2024 Credit Agreement was $2,617 and $7,974 for the years ended December 31, 2025 and 2024, respectively.
2025 Credit Agreement
On April 10, 2025, the Company amended and restated its 2024 Credit Agreement (the “2025 Amended and Restated Credit Agreement”) with its existing lenders to, among other things, increase its borrowing base on the term loan to $301,000 (the “2025 Term Loan”) and extend the maturity date to April 30, 2030. The proceeds of the 2025 Term Loan
were used to repay in full all outstanding obligations under the 2024 Term Loan and to finance a dividend. The revolving loan commitment remained at $10,000 (“2025 Revolver”) and its maturity date was also extended to April 30, 2030. The Company applied modification accounting to the 2024 Credit Agreement and capitalized $477 of deferred financing fees, $36 of deferred financing asset, and recognized interest expense of $518 for third party fees related to the 2025 Amended and Restated Credit Agreement. Unamortized deferred financing fees of $1,238 related to the 2024 Term Loan continued to be amortized over the term of the 2025 Term Loan. During the year ended December 31, 2025, and prior to the refinancing on November 10, 2025, the Company made aggregate principal repayments of $50,000.
First Amendment to the 2025 Credit Agreement
On November 10, 2025, Neptune Flood entered into the first amendment to the 2025 Amended and Restated Credit Agreement (“First Amendment”) with its existing lenders to, among other things, to increase the maximum availability of the 2024 Revolver to $260,000 (“Amended 2025 Revolver”). The Company used proceeds drawn on the Amended 2025 Revolver from the First Amendment to paydown the outstanding balance of the 2025 Term Loan. The Company applied modification accounting to the Amended 2025 Revolver and capitalized $426 of deferred financing asset related to the First Amendment. Unamortized deferred financing fees of $1,264 related to the 2025 Amended and Restated Credit Agreement were reclassified to deferred financing asset and deferred financing asset of $106 related to the 2025 Amended and Restated Credit Agreement continues to be amortized over the term of the Amended 2025 Revolver. At the Company's option, the interest rate on the Amended 2025 Revolver may be based on either ABR plus an applicable margin ranging from 0.75% to 2.00% or Term SOFR ranging from 1.75% to 3.00%, depending on the Company’s total net leverage ratio for the prior fiscal quarter. Interest is payable quarterly and the maturity date was extended to November 10, 2030, at which time any outstanding principal and accrued interest is due. As of December 31, 2025, the total amount outstanding under the revolving credit facility was $240,000.
Incremental Loans: The Company may request up to three tranches of incremental term loans (“Incremental Term Loan”) or increases to the existing Revolver (“Additional Revolving Commitment”), subject to lender participation and agent approval. Each Incremental Term Loan request must be for a minimum principal amount of $10,000. The total amount of Additional Revolving Commitments under all such requests shall not exceed $10,000 over the term of the agreement. Any Incremental Term Loan(s) must (a) rank pari passu in right of payment and be secured solely by the existing collateral, (b) have no obligors other than the loan parties, (c) mature no earlier than the latest maturity date of any then-outstanding term loans, and (d) not have a shorter weighted average life to maturity than the existing Term Loans. Incremental Term Loans may be priced differently but must otherwise be treated no more favorably than existing term loans, subject to exceptions for loans maturing after the latest maturity date.
Borrowings under the Amended Credit Agreement are secured by a first-priority lien on substantially all of the Company’s stock and assets and are subject to certain restrictive covenants primarily relating to net leverage ratios. Under the 2024 Credit Agreement, the Company was subject to two key financial covenants which began with the fiscal quarter ending June 30, 2024. First, the Company was required to maintain a total net leverage ratio that did not exceed 4.50 through the quarter ending September 30, 2024. This threshold tightened over time, requiring a maximum ratio of 4.25 for quarters ending from December 31, 2024 through March 31, 2025. Under the 2025 Amended and Restated Credit Agreement, the Company was required to maintain a total net leverage ratio that did not exceed 5.00 through the quarter ending September 30, 2025. This threshold will tighten to 4.50 for the quarters ending from December 31, 2025 through June 30, 2026, and further reduce to 4.00 for quarters ending on or after September 30, 2026. Second, the Company is required to maintain an interest coverage ratio of at least 2.00 for any rolling four-quarter period ending on the last day of each fiscal quarter, starting with the quarter ending June 30, 2024. The Company was in compliance with both covenants as of December 31, 2025.
The First Amendment contains a number of customary negative covenants for agreements of this type that, among other things and subject to certain exceptions, restrict the Company’s ability to: create, incur, or assume any additional indebtedness; create, incur, or assume any liens; engage in mergers, consolidations, or amalgamations; make investments, loans, or advances; pay dividends; sell assets; engage in certain transactions with affiliates; enter into restrictive agreements; enter into sale and leaseback transactions; execute amendments to organizational documents or certain other material agreements; and make certain accounting changes.
Interest expense was $18,243, $17,520 and $21,326 for the years ended December 31, 2025, 2024, and 2023, respectively, of which $562, $871 and $1,194 was attributable to the amortization of the debt issuance costs, respectively, and $70, $34 and $34 was attributable to the amortization of the deferred financing asset, respectively. Accrued interest associated with the outstanding debt is included within accrued expenses on the consolidated balance sheets. As of December 31, 2025, and 2024, the Company had $932 and $451, respectively, of accrued interest associated with the debt.
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.