INTERSECTIONS INC. (NASDAQ:INTX) Files An 8-K Entry into a Material Definitive Agreement

On April 20, 2017, Intersections Inc. (the “Company”)
refinanced its existing senior secured indebtedness under the
Prior Credit Agreement (as defined below) with a new $20 million
term loan facility (which was fully funded at closing) with PEAK6
Investments, L.P.

New Credit Agreement

In order to consummate the refinancing, the Company and its
subsidiaries entered into a credit agreement (the “New Credit
Agreement”) with PEAK6 Investments, L.P., as Term Lender and as
Administrative Agent, and also entered into a security agreement,
a pledge and security agreement, an intellectual property
security agreement and other related documents. The New Credit
Agreement extends the maturity date, reduces and defers mandatory
quarterly principal payments, and carries a lower interest rate
compared to the Prior Credit Agreement. The maturity date of the
New Credit Agreement is April 20, 2021 and quarterly principal
payments of $1.25 million commencing on September 30, 2019. The
initial interest rate is 9.486% per annum, to be adjusted
annually on March 31 to 7.75% plus 1 year LIBOR, and interest is
payable monthly. The New Credit Agreement is secured by
substantially all of the assets of Intersections and its
subsidiaries and a pledge by Intersections of stock and
membership interests it holds in any domestic and first-tier
foreign subsidiaries.

The Company used approximately $13.9 million of the net proceeds
from the New Credit Agreement to repay in full the aggregate
principal amount outstanding under the Credit Agreement dated as
of March 21, 2016, as amended from time to time (the “Prior
Credit Agreement”), among the Company, the other Credit Parties
party thereto, Crystal Financial SPV LLC, as term lender, and
Crystal Financial LLC, as administrative agent for the secured
parties, and to pay related interest and prepayment penalties,
transaction fees and expenses. The Company expects to use the
remainder of the proceeds from the New Credit Agreement for
general corporate purposes, including to accelerate both
subscriber acquisition and product development.

The New Credit Agreement also requires the prepayment of the
aggregate principal amount outstanding in an amount equal to 25%
of the Company’s excess cash flow (as defined in the New Credit
Agreement) for each fiscal year commencing with the fiscal year
ending December 31, 2018 and continuing thereafter. Certain other
events defined in the New Credit Agreement require prepayment of
the aggregate principal amount of the term loan, including all or
a portion of proceeds received from asset dispositions (except
for proceeds from the sale of assets in our i4c subsidiary of up
to $2.2 million), casualty events, extraordinary receipts, and
equity issuances. In addition, we are permitted to invest up to
$2.2 million, in the aggregate inclusive of amounts already
invested, in our i4c subsidiary to complete the wind-down, which
is expected to be completed by June 30, 2017 (or such later date
as the Administrative Agent may permit). Once amounts borrowed
have been paid or prepaid, they may not be reborrowed.

The New Credit Agreement contains certain customary covenants,
including among other things covenants that limit or restrict the
following: the incurrence of liens; the making of investments
including a prohibition of any capital contributions to our
subsidiary i4c other than to complete the wind-down as noted
above and fair and reasonable allocation of overhead and
administrative expenses; the incurrence of certain indebtedness;
mergers, dissolutions, liquidations, or consolidations;
acquisitions (other than certain permitted acquisitions); sales
of substantially all of our or any of our subsidiaries’ assets,
except for the orderly wind down of the Pet Health Monitoring,
and the exits of our Bail Bonds Industry Solutions and Habits at
Work businesses; the declaration of certain dividends or
distributions; transactions with affiliates (other than parties
to the New Credit Agreement) other than on fair and reasonable
terms; and the formation or acquisition of any direct or indirect
domestic or first-tier foreign subsidiary unless such subsidiary
becomes a guarantor and enters into certain security documents.

The New Credit Agreement requires us to maintain at all times a
minimum cash on hand amount, as defined in the New Credit
Agreement, of at least 20% of the total amount outstanding under
the term loan. We are also required to maintain compliance on a
quarterly basis commencing with the quarter ending December 31,
2017 with minimum consolidated EBITDA (as defined in the New
Credit Agreement and adjusted for certain non-cash, non-recurring
and other items, and up to $4.25 million of non-recurring charges
incurred in the wind-down events) of $2 million; provided
consolidated EBITDA from the immediately preceding quarter in
excess of $2 million may be added to a current quarter to make up
any shortfall and provided further that when we have not met the
minimum consolidated EBITDA test for any quarter (even after
including excess consolidated EBITDA for the prior quarter) the
test for compliance is deferred until the end of the next quarter
and we shall be deemed to be in compliance if, taking into
account consolidated EBITDA in excess of $2 million from the
prior quarter, consolidated EBITDA from the test quarter, and
consolidated EBITDA in excess of $2 million from the subsequent
quarter, we pass the minimum compliance test. Excess consolidated
EBITDA in any quarter can be counted only once for determining
compliance with this covenant.

The New Credit Agreement also contains customary events of
default, including among other things non-payment defaults,
covenant defaults, inaccuracy of representations and warranties,
bankruptcy and insolvency defaults, material judgment defaults,
ERISA defaults, cross-defaults to other indebtedness, invalidity
of loan documents defaults, change in control defaults, conduct
of business defaults, and criminal and regulatory action
defaults. Further, if our rights to provide services to
subscribers under our agreements with Bank of America cease as a
result of Bank of America transferring the provision of such
services or using a different service provider and such cessation
results in greater than a 20% decline in our consolidated
revenue, a covenant violation (and resulting event of default)
will arise under the New Credit Agreement.

Warrant

In connection with the New Credit Agreement, PEAK6 Investments,
L.P. purchased, for an aggregate purchase price of $1.5 million
in cash, a warrant (the “Warrant”) to purchase an aggregate of
1,500,000 shares of the Company’s common stock at an exercise
price of $5.00 per share. The Warrant is immediately exercisable,
has a five-year term and shall be exercised solely by a “net
share settlement” feature that requires the holder to exercise
the Warrant without a cash payment upon the terms set forth
therein. The Warrant includes a feature to provide for increases
in the number of shares issuable upon exercise in the event of a
future change of control transaction (as defined therein), with
the number of increased shares based upon the time elapsed from
issuance of the Warrant and the difference between the exercise
price of the Warrant and the transaction price in the change of
control, all as more fully set forth in the Warrant. The Warrant
also provides for adjustments in the underlying number of shares
and exercise price in the event of recapitalizations, stock
splits or dividends and other corporate events.

Stock Redemption

In connection with the New Credit Agreement, the Company used the
proceeds from the sale of the Warrant to repurchase 419,498
shares of the Company’s common stock, to a redemption agreement
(the “Redemption Agreement”) from PEAK6 Capital Management LLC
at a price of $3.60 per share, for an aggregate repurchase price
of approximately $1.5 million. PEAK6 Capital Management LLC is an
affiliate of PEAK6 Investments.

The repurchase was made to the Company’s previously announced
share repurchase program. Following the repurchase, the Company
has approximately $15.3 million remaining under its repurchase
program. The repurchases may be made on the open market, in block
trades, through privately negotiated transactions or otherwise,
and the program may be suspended or discontinued at any time.
However, the Company is currently prohibited from repurchasing
any shares of common stock under the New Credit Agreement.

Incorporation by Reference

The foregoing descriptions of the New Credit Agreement, the
Warrant, and the Redemption Agreement are not intended to be
complete and are qualified in their entirety by reference to the
full text of such agreements, copies of which are attached as
Exhibits 10.1 through 10.3 to this Current Report on Form 8-K and
incorporated by reference into this Item 1.01.

Item 1.02. Termination of a Material Definitive Agreement.

In connection with the entry into the New Credit Agreement
described in Item 1.01 above, effective April 20, 2017, the
Company and its applicable subsidiaries satisfied and discharged
all obligations under, and terminated, the Prior Credit
Agreement, except for obligations that to the express terms of
the Prior Credit Agreement survive payment of the obligations.

The Prior Credit Agreement provided for a $20.0 million term loan
that was scheduled to mature on March 21, 2019, and required the
Company to make quarterly and certain other mandatory
prepayments. As of April 20, 2017, $13.4 million was outstanding
under the Prior Credit Agreement. The Company incurred early
termination penalties of approximately $0.4 million as a result
of the termination.

Item 2.03

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 1.01 is incorporated by
reference into this Item 2.03.

Item 3.02. Unregistered Sales of Equity Securities.

The information disclosed under the subheading “Warrant” in
Item 1.01 is incorporated by reference into this Item 3.02.

The issuance of the Warrant was made in reliance on the exemption
from registration contained in Section 4(a)(2) of the Securities
Act of 1933, as amended (the “Act”).

Item 7.01 Regulation FD Disclosure.

A copy of the Company’s press release, issued on April 21, 2017,
announcing the closing of the transactions described above is
attached hereto as Exhibit 99.1 and is incorporated herein by
reference.

The information in this report shall not be deemed “filed” for
purposes of Section 18 of the Securities Exchange Act of 1934,
nor shall it be deemed incorporated by reference in any filing
under the Act or the Securities Exchange Act of 1934, except as
shall be expressly set forth by specific reference in such a
filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

The following exhibits are filed herewith.