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Notes Payable | 9 Months Ended
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Sep. 30, 2013
Debt Disclosure [Abstract] |
Notes Payable |
| Notes Payable
The notes payable and borrowings of Tiptree's subsidiaries are discussed below: PFG In connection with the PFAS Transaction described in Note 1, PFG issued a note in July 2012 in the amount of $100,000 to a third party. The note bears an annual interest rate of 12.66% and provides for monthly interest and principal payments commencing on August 15, 2012, with final payment due on July 15, 2022. Common stock of Philadelphia Financial Administration Services Company, the borrower, serves as collateral for the note. Operating Subsidiary On December 28, 2012, Operating Subsidiary issued a note payable in the amount of $2,500 with an annual interest rate of 5%. This note was payment for 6.60% of the issued and outstanding Series A preferred stock and 8.80% of the issued and outstanding common shares of PFG. The term of this note is eighteen months commencing on December 28, 2012. On September 18, 2013, Operating Subsidiary entered into a Credit Agreement with Fortress Credit Corp. (Fortress) and borrowed $50,000 thereunder. The Credit Agreement allows Operating Subsidiary to borrow additional amounts up to a maximum aggregate of $125,000, subject to satisfaction of certain customary conditions. The obligations of Operating Subsidiary under the Credit Agreement are secured by liens on substantially all of the assets of Operating Subsidiary. The principal of, and all accrued and unpaid interest on, all loans under the Credit Agreement become immediately due and payable on September 18, 2018. Loans under the Credit Agreement bear interest at a variable rate per annum equal to one-month LIBOR (with a minimum LIBOR rate of 1.25%), plus a margin of 6.50% per annum. The principal amounts of the loan is to be repaid in quarterly installments, the amount of which may be adjusted based on the Net Leverage Ratio (as defined in the Credit Agreement) at the end of each fiscal quarter. As of September 30, 2013, the $50,000 borrowing was recorded as part of notes payable on the consolidated balance sheet of the Company. The company is obligated to pay interest on a monthly basis and has incurred interest expense of $130 for the nine month period ended September 30, 2013. The Company capitalized approximately $2,308 of costs associated with transaction and is amortizing the costs ratably over the life of the facility. The Company recorded approximately $15 of expense for the nine month period ended September 30, 2013 relating to these capitalized costs. Operating Subsidiary believes it was in compliance with all of the financial covenants contained in the Credit Agreement as of September 30, 2013. The following table summarizes the balance and payment activity of the borrowings of the Company's subsidiaries:
Opening Balance on July 31, 2012 | $ | 100,000 |
Principal payments | (2,083 | )
Additional note December 28, 2012 | 2,500 |
Unpaid principal balance at December 31, 2012: | 100,417 |
Principal payments | (3,917 | )
Credit Agreement September 18, 2013 | 50,000 |
Unpaid Principal balance at September 30, 2013 | $ | 146,500 |
Interest expense of $10,879 was incurred on the borrowings for the nine month period ended September 30, 2013. Consolidated CLOs The Company includes in its consolidated balance sheets, as part of liabilities of consolidated CLOs, the debt obligations used to finance the investment in corporate loans and other investments owned by the CLOs that it manages. The carrying amount of the notes represents the accreted value from the initial consolidation (at January 1, 2010 based upon fair values as of December 31, 2009 for Telos 1 and Telos 2 or note issuance date for Telos 3 and Telos 4) and is recognized through the measurement date using the effective interest method or a method that approximates the effective interest method. The tables below summarize the debt obligations of the CLOs consolidated by the Company as of September 30, 2013 and December 31, 2012:
| September 30, 2013
| Aggregate Principal amount |  | Spread over three Months LIBOR |  | Unamortized Discount |  | Carrying Amount
Description |  |  |  |  |  |  |
Telos 4 (maturity July 2024) |  |  |  |  |  |  |
Class A | $ | 214,000 |  |  | 1.30 | % |  | $ | 984 |  |  | $ | 213,016 |
Class B | 46,500 |  |  | 1.80 | % |  | 2,111 |  |  | 44,389 |
Class C | 29,000 |  |  | 2.75 | % |  | 1,430 |  |  | 27,570 |
Class D | 19,250 |  |  | 3.50 | % |  | 1,592 |  |  | 17,658 |
Class E | 16,000 |  |  | 5.00 | % |  | 2,009 |  |  | 13,991 |
Class X | 3,500 |  |  | 0.95 | % |  | — |  |  | 3,500 |
Subordinated | 10,700 |  |  | N/A |  |  | 527 |  |  | 10,173 |
Telos 3 (maturity October 2024) |  |  |  |  |  |  |
Class A | 225,000 |  |  | 1.42 | % |  | — |  |  | 225,000 |
Class B | 36,500 |  |  | 2.25 | % |  | — |  |  | 36,500 |
Class C | 26,500 |  |  | 3.00 | % |  | 582 |  |  | 25,918 |
Class D | 18,000 |  |  | 4.25 | % |  | 837 |  |  | 17,163 |
Class E | 15,000 |  |  | 5.50 | % |  | 1,537 |  |  | 13,463 |
Class F | 6,000 |  |  | 5.50 | % |  | 756 |  |  | 5,244 |
Subordinated | 29,000 |  | (1) | N/A |  |  | 1,364 |  |  | 27,636 |
Telos 2 (maturity April 2022) |  |  |  |  |  |  |
Class A-1 | 241,000 |  |  | 0.26 | % |  | 31,506 |  |  | 209,494 |
Class A-2 | 40,000 |  |  | 0.40 | % |  | 8,941 |  |  | 31,059 |
Class B | 27,500 |  |  | 0.55 | % |  | 7,716 |  |  | 19,784 |
Class C | 22,000 |  |  | 0.95 | % |  | 9,668 |  |  | 12,332 |
Class D | 22,000 |  |  | 2.20 | % |  | 12,095 |  |  | 9,905 |
Class E | 16,000 |  |  | 5.00 | % |  | 13,210 |  |  | 2,790 |
Subordinated | 2,000 |  |  | N/A |  |  | 1,670 |  |  | 330 |
Telos 1 (maturity October 2021) |  |  |  |  |  |  |
Class A-1D | 49,560 |  |  | 0.27 | % |  | 6,328 |  |  | 43,232 |
Class A-1R | 18,584 |  |  | 0.29 | % |  | 2,374 |  |  | 16,210 |
Class A-1T | 68,145 |  |  | 0.27 | % |  | 8,697 |  |  | 59,448 |
Class A-2 | 60,000 |  |  | 0.40 | % |  | 13,132 |  |  | 46,868 |
Class B | 27,200 |  |  | 0.49 | % |  | 7,467 |  |  | 19,733 |
Class C | 22,000 |  |  | 0.85 | % |  | 9,468 |  |  | 12,532 |
Class D | 22,000 |  |  | 1.70 | % |  | 11,763 |  |  | 10,237 |
Class E | 16,000 |  |  | 4.25 | % |  | 12,942 |  |  | 3,058 |
Subordinated | 40,223 |  |  | N/A |  |  | 26,832 |  |  | 13,391 |
| $ | 1,389,162 |  |  |  |  | $ | 197,538 |  |  | $ | 1,191,624 |
(1) | In addition to original amount of $24,000 reflects $5,000 issued by Telos 3 to a third party.
| December 31, 2012
| Aggregate Principal amount |  | Spread over three Months LIBOR |  | Unamortized Discount |  | Carrying Amount
Description |  |  |  |  |  |  |
Telos 2 (maturity April 2022) |  |  |  |  |  |  |
Class A-1 | $ | 241,000 |  |  | 0.26 | % |  | $ | 33,980 |  |  | $ | 207,020 |
Class A-2 | 40,000 |  |  | 0.40 | % |  | 9,592 |  |  | 30,408 |
Class B | 27,500 |  |  | 0.55 | % |  | 8,248 |  |  | 19,252 |
Class C | 22,000 |  |  | 0.95 | % |  | 10,223 |  |  | 11,777 |
Class D | 22,000 |  |  | 2.20 | % |  | 12,633 |  |  | 9,367 |
Class E | 16,000 |  |  | 5.00 | % |  | 13,340 |  |  | 2,660 |
Subordinated | 2,000 |  |  | N/A |  |  | 1,719 |  |  | 281 |
Telos 1 (maturity October 2021) |  |  |  |  |  |  |
Class A-1D | 80,000 |  |  | 0.27 | % |  | 11,097 |  |  | 68,903 |
Class A-1R | 30,000 |  |  | 0.29 | % |  | 4,163 |  |  | 25,837 |
Class A-1T | 110,000 |  |  | 0.27 | % |  | 15,258 |  |  | 94,742 |
Class A-2 | 60,000 |  |  | 0.40 | % |  | 14,163 |  |  | 45,837 |
Class B | 27,200 |  |  | 0.49 | % |  | 8,026 |  |  | 19,174 |
Class C | 22,000 |  |  | 0.85 | % |  | 10,065 |  |  | 11,935 |
Class D | 22,000 |  |  | 1.70 | % |  | 12,371 |  |  | 9,629 |
Class E | 16,000 |  |  | 4.25 | % |  | 13,148 |  |  | 2,852 |
Subordinated | 40,223 |  |  | N/A |  |  | 28,145 |  |  | 12,078 |
| $ | 777,923 |  |  |  |  | $ | 206,171 |  |  | $ | 571,752 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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