Company: FOACW
Filing Date: 2025-05-20
Form Type: 10-K/A
Source: 0001828937-25-000032
Chunk: 89

Company: Finance of America Companies Inc.
Filing Date: 2025-05-20
Form: 10-K/A
Chunk 89
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 bankruptcy.”

The agreements that govern our warehouse facilities and lines of credit typically contain covenants relating to our financial condition and we may experience difficulties in complying with such financial covenants.

The agreements that govern our warehouse facilities and lines of credit typically contain, and we expect that other financing facilities that we may enter into in the future will typically contain, covenants that, among other things, impose requirements relating to minimum tangible or adjusted tangible net worth, maximum leverage ratio of total liabilities (which may include off-balance sheet liabilities) or indebtedness to tangible or adjusted tangible net worth, minimum liquidity or minimum liquid assets, and minimum net income or pre-tax net income. As a result of fair value related accounting adjustments, we experienced difficulties complying with one such financial covenant relating to net income with respect to the fourth fiscal quarter of 2024 and ultimately were required to obtain a waiver with respect to such financial covenant for the fourth fiscal quarter of 2024. We have also at times had difficulties complying with certain financial covenants in years prior to 2024 and have had to obtain waivers or amendments to the terms of the affected covenants. In a few instances, we elected to terminate the applicable financing arrangement rather than seeking an amendment or waiver, in particular in connection with financings of FAM due to the discontinuation and wind-down of the traditional mortgage lending segment, the commercial lending segment, and the home improvement lending business operated by FAM. While we have been able to secure amendments or waivers with respect to, or to terminate, all affected lending arrangements, there is no assurance that our lenders would provide waivers for or agree to amendments to address any future difficulties we encounter in complying with our financial covenants. Further, we may have to agree to other covenants in connection with securing waivers or amendments in the future. If we were to experience difficulties in complying with financial covenants in the future and we were not able to secure a waiver or amendment or terminate the applicable financing arrangement, we could breach such a financial covenant and an event of default could occur. Upon the occurrence and during the continuance of an event of default, the holders of our indebtedness could elect to declare all the funds borrowed to be due and payable. See “—Our failure to comply with the requirements of our outstanding indebtedness could result in an event of default that could materially and adversely affect our financial condition and ultimately force us into liquidation or bankruptcy.”

Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebted