Debt

The following table presents White Mountains’s debt outstanding as of December 31, 2018 and 2017:



	December 31,			Effective	December 31,			Effective
Millions	2018			Rate ⁽¹⁾	2017			Rate ⁽¹⁾
WTM Bank Facility	$	—		N/A	$	—		N/A
NSM Bank Facility	180.4			7.4%	—
Unamortized issuance cost	(3.8		)		—
NSM Bank Facility, carrying value	176.6			—	—
MediaAlpha Bank Facility	14.3			7.1%	23.9			5.6%
Unamortized issuance cost	(.1		)		(.1		)
MediaAlpha Bank Facility, carrying value	14.2				23.8
Other NSM debt, carrying value	1.9				—
Total debt	$	192.7			$	23.8

⁽¹⁾Effective rate considers the effect of the debt issuance costs.

The following table presents a schedule of contractual repayments of White Mountains’s debt as of December 31, 2018:



Millions	December 31, 2018
Due in one year or less	$	5.2
Due in two to three years	10.4
Due in four to five years	9.4
Due after five years	171.9
Total	$	196.9

WTM Bank Facility

White Mountains had a revolving credit facility with a syndicate of lenders administered by Wells Fargo Bank, N.A., which had a total commitment of $425.0 million (the “WTM Bank Facility”). White Mountains terminated the WTM Bank Facility on May 8, 2018.

White Mountains recorded $0.3 million, $0.6 million, and $1.2 million of interest expense on the WTM Bank Facility for the years ended December 31, 2018, 2017 and 2016.

NSM Bank Facility

On May 11, 2018, NSM entered into a secured credit facility (the “NSM Bank Facility”) with Ares Capital Corporation in order to refinance NSM’s existing debt and to fund the acquisitions of subsidiaries. The NSM Bank Facility is comprised of a term loan of $100.0 million, two delayed-draw term loans of $51.0 million, to fund the Fresh Insurance acquisition, and $30.1 million, to fund the KBK acquisition, and a revolving credit loan commitment of $10.0 million, under which NSM initially borrowed $2.0 million. The term loans under the NSM Bank Facility mature on May 11, 2024, and the revolving loan under the NSM Bank Facility matures on May 11, 2023. During the period from May 11, 2018 through December 31, 2018, NSM repaid $0.8 million on the term loans and $2.0 million on the revolving credit loan. As of December 31, 2018, $180.4 million of the term loans were outstanding and the revolving credit loan was undrawn.

Interest on the NSM Bank Facility accrues at a floating interest rate equal to the three month LIBOR or the Prime Rate, as published by the Wall Street Journal plus, in each case, an applicable margin. The margin over LIBOR may vary between 4.25% and 4.75%, and the margin over the Prime Rate may vary between 3.25% and 3.75%, in each case, depending on the consolidated total leverage ratio of the borrower.

On June 15, 2018, NSM entered into an interest rate swap agreement to hedge its exposure to interest rate risk on $151.0 million of its variable rate term loans. Under the terms of the swap agreement, NSM pays a fixed rate of 2.97% and receives a variable rate, which is reset monthly, based on the then-current LIBOR. As of December 31, 2018, the variable rate received by NSM under the swap agreement was 2.52%. As of December 31, 2018, the effective interest rate for the outstanding term loans of $150.2 million that are hedged by the swap was 7.47%. The effective interest on the outstanding term loans of $30.0 million that are unhedged was 6.85%. The effective interest rate on the total outstanding term loans under the NSM Bank Facility of $180.4 million was 7.42%. See Note 7 — “Derivatives — NSM Interest Rate Swap”.

NSM recorded $8.0 million of interest expense on the NSM Bank Facility for the 2018 ownership period.

The NSM Bank Facility is secured by all property of the loan parties and contains various affirmative, negative and financial covenants that White Mountains considers to be customary for such borrowings, including a maximum consolidated total leverage ratio covenant.

MediaAlpha Bank Facility

On May 12, 2017, MediaAlpha entered into a secured credit facility (the “MediaAlpha Bank Facility”) with Western Alliance Bank, which had a total commitment of $20.0 million and had a maturity date of May 12, 2020. On October 5, 2017, MediaAlpha refinanced the MediaAlpha Bank Facility in order to fund the acquisition of certain assets associated with the Health, Life and Medicare insurance business of Healthplans.com. The total commitment of the MediaAlpha Bank Facility was increased to $28.4 million and has a maturity date of October 6, 2020. The MediaAlpha Bank Facility consists of a $18.4 million term loan facility, which has an outstanding balance of $14.3 million as of December 31, 2018, and a revolving loan facility for $10.0 million, which was undrawn as of December 31, 2018. The MediaAlpha Bank Facility replaced MediaAlpha’s previous credit facility with Opus Bank, which had a total commitment of $20.0 million.

The MediaAlpha Bank Facility carries a variable interest rate that is based on the Prime Rate, as published by the Wall Street Journal, plus a spread of 1.5% on the term loan facility and 0.25% on the revolving credit facility as of December 31, 2018.

During 2018, under the MediaAlpha Bank Facility, MediaAlpha repaid $3.6 million on the term loan and borrowed $3.0 million and repaid $9.0 million on the revolving loan. In 2017, under the MediaAlpha Bank Facility, MediaAlpha borrowed $20.0 million and repaid $2.1 million on the term loan and borrowed $6.0 million on the revolving loan. During 2017, under the previous MediaAlpha Bank Facility, MediaAlpha repaid $12.9 million.

MediaAlpha recorded $1.2 million, $1.0 million, $0.9 million of interest expense on the MediaAlpha Bank Facility for the years ended December 31, 2018, 2017 and 2016.

The MediaAlpha Bank Facility is secured by intellectual property and the common stock of MediaAlpha’s subsidiaries, and contains various affirmative, negative and financial covenants that White Mountains considers to be customary for such borrowings, including a fixed charge coverage ratio and an asset coverage ratio.

Other NSM Debt

On December 12, 2016, in connection with the acquisition of a wholly-owned subsidiary, NSM assumed a secured term loan facility with Ageas Insurance Limited, which has a maturity date of May 11, 2024. As of December 31, 2018, the secured term loan facility has an outstanding balance of $2.2 million. The carrying value of the debt includes a purchase accounting adjustment of $(0.3) million to reflect the debt at its acquisition date fair value. The $(0.3) million is being amortized over the remaining term of the loan.

Debt Covenants

As of December 31, 2018, White Mountains was in compliance with all of the covenants under all of its debt facilities.

Interest

Total interest expense incurred by White Mountains for its indebtedness was $9.5 million, $2.3 million and $3.0 million for the periods ended December 31, 2018, 2017 and 2016. Total interest paid by White Mountains for its indebtedness was $8.8 million, $1.4 million, and $2.1 million for the periods ended December 31, 2018, 2017 and 2016.