Notes Payable



The Company's Notes Payable consisted of the following:	At
	March 31, 2014			December 31, 2013
Wells Fargo Bank, N.A. credit facility, maturing August 2019 ⁽¹⁾	$	7,067		$	—
Synovus Bank, revolving line of credit, maturing April 2017	6,098			3,273
Total	$	13,165		$	3,273

Maximum balance allowed on the Wells Fargo Bank, N.A. credit facility ⁽¹⁾	$	100,000		$	75,000
Interest rate at the end of the respective period, Wells Fargo Bank, N.A. credit facility⁽²⁾	4.25		%	—		%

Maximum balance allowed on the Synovus Bank, revolving line of credit	$	15,000		$	15,000
Interest rate at the end of the respective period, Synovus Bank, revolving line of credit	3.24		%	3.24		%

⁽¹⁾- The maturity date was extended to August 2, 2019 and the maximum balance was increased to $100.0 million, effective April 11, 2014.

⁽²⁾ - At December 31, 2013 the Company had no borrowings outstanding under the Revolving Facility, thus no interest rate can be defined.

The following table presents the aggregate maturities for the Company's notes payable by year at March 31, 2014:



	Maturities
Remainder of 2014	$	6,098
2015	—
2016	—
2017	—
2018	—
Thereafter ⁽¹⁾	7,067
Total maturities	$	13,165

⁽¹⁾- Effective April 11, 2014, the maturity date was extended to August 2, 2019.

$100.0 million Secured Credit Agreement - Wells Fargo Bank, N.A.

On April 11, 2014 the Company amended the original credit agreement, entered into on August 2, 2012, (as amended, the "Credit Agreement"), with a syndicate of lenders, among them Wells Fargo Bank, N.A., who also serves as administrative agent ("Wells Fargo" or the "Administrative Agent"). The Credit Agreement provides for an extended maturity to August 2, 2019 (subject to earlier termination) and an increased revolving credit facility of $100.0 million (the "Revolving Facility") with a sub-limit of $10.0 million for swingline loans and $10.0 million for letters of credit. The Credit Agreement includes a provision pursuant to which, from time to time, the Company may request that the lenders in their discretion increase the maximum amount of commitments under the Facilities by an amount not to exceed $50.0 million. The Credit Agreement also contains financial covenants, which the Company must maintain. See the section below, "Financial Covenants" for a presentation of the Company's more significant covenants associated with the Credit Agreement. The amendment to the Credit Agreement also serves to (1) reduce the interest rate margin on revolving loans by 0.35% for each pricing level and (2) reduce the unused line fee paid on undrawn revolving commitments by 0.05% for each pricing level.

Financial Covenants - Secured Credit Agreement - Wells Fargo Bank, N.A.

At March 31, 2014 and December 31, 2013, respectively, the Company was required to comply with various financial covenants set forth in the Credit Agreement. The following describes the Credit Agreement's more significant financial covenants in effect at March 31, 2014 and the calculations used to arrive at each ratio (capitalized terms used but not defined in this paragraph are defined in the Credit Agreement or as otherwise provided below):

Total Leverage Ratio - the ratio of (i) Consolidated Total Debt as of such date to (ii) Consolidated Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") for the Measurement Period ending on or immediately prior to such date.

Fixed Charge Coverage Ratio - the ratio of (a) Consolidated Adjusted EBITDA less the actual amount paid by the Borrowers and their Subsidiaries in cash on account of Capital Expenditures less cash taxes paid by the Borrowers and their Subsidiaries to (b) Consolidated Fixed Charges, in each case for the Measurement Period ending on or immediately prior to such date.

Reinsurance Ratio - the ratio (expressed as a percentage) of (a) the aggregate amounts recoverable by the Borrowers and its Subsidiaries from reinsurers divided by (b) the sum of (i) policy and claim liabilities plus (ii) unearned premiums, in each case of the Borrowers and their Subsidiaries determined in accordance with U.S. GAAP.

Risk-Based Capital ("RBC") Ratio - the ratio (expressed as a percentage) of NAIC RBC (as defined in the NAIC standards) for any Regulated Insurance Company on an individual basis, calculated at the end of any Fiscal Year, to the "authorized control level" (as defined in the NAIC standards).

The following table presents the Credit Agreement's more significant financial covenants at March 31, 2014, except for the RBC ratios, which under the Credit Agreement reflect the ratios calculated as of the most recent year-end, in this case, December 31, 2013:



		Actual At
Covenant	Covenant Requirement	March 31, 2014
Total leverage ratio	not more than 3.25	0.84
Fixed charge coverage ratio	not less than 2.00	3.51
Reinsurance ratio	not less than 50%	68.0%

		Actual At
		December 31, 2013
RBC Ratios:
RBC Ratio - Bankers Life of Louisiana	not less than 250%	435.0%
RBC Ratio - Southern Financial Life Insurance Company	not less than 250%	2,096.0%
RBC Ratio - Insurance Company of the South	not less than 250%	366.0%
RBC Ratio - Lyndon Southern Insurance Company	not less than 250%	305.0%
RBC Ratio - Life of the South Insurance Company	not less than 250%	430.0%
RBC Ratio - Response Indemnity Company of California	not less than 250%	39,754.0%

$15.0 million Revolving Line of Credit - Synovus Bank

At March 31, 2014, the Company's subsidiary, South Bay had a $15.0 million revolving line of credit agreement (the "Line of Credit") with Synovus Bank, entered into in October 2013, with a maturity date of April 2017. The Line of Credit bears interest at a rate of 300 basis points plus 90-day LIBOR. South Bay uses the Line of Credit for its premium-financing product. The Line of Credit allows South Bay to finance up to 90% of the eligible receivables less an applicable reserve of $500,000. At March 31, 2014, the balance of premium financing receivables included in notes receivable, net, on the Consolidated Balance Sheet, totaled $9.8 million. At March 31, 2014, South Bay was in compliance with the covenants required by the Line of Credit.