Sole Structuring Agent and Joint Bookrunner to Ariel Re Sponsored Titania Re Ltd. on the $125mm Series 2023-1 Class A and Class B Notes

On February 23, 2023, Ariel Re sponsored a 144A CAT Bond through Titania Re Ltd.

• The Class A notes priced at 12.25% – 8.4% below the mid-point of their initial pricing guidance
• The Class B notes priced at 12.75% – 8.1% below the mid-point of their initial pricing guidance
• For each class, the investor spread tightened by 150bps from the wide end of the initial pricing guidance

The transaction received strong investor support; upsizing from the original target of $115 million to $125 million

• Class A notes were upsized from $65 million to $75 million while the Class B notes closed at their initially targeted size of $50 million
• Titania 2023-1 was the first transaction since June 2022 where a Cat Bond transaction settled below the initial price guidance, indicating a more robust equilibrium matching capital with demand
• The transaction introduced a first-of-its-kind carbon offset feature

Class A and Class B notes offer index-based coverage across the U.S., Puerto Rico, U.S. Virgin Islands, D.C., and Canada

• Class A Notes provide annual aggregate Named Storm and Earthquake coverage
• Class B Notes provide per-occurrence and Named Storm only coverage

Issuance consisted of Class A and Class B notes of differing risk profiles

• Class A Expected loss (AIR; WSST): 2.95%
• Class B Expected loss (AIR; WSST): 4.26%

HTCMA acted as Sole Structuring Agent and Joint Bookrunner

• Sole party responsible for working with client to optimize Cat Bond structure
• Presented innovative structuring ideas and assisted in finalizing basis risk analysis
• Assisted in all aspects of the structuring and placement including, but not limited to:
  • Structuring and coordination with legal counsel
  • Providing in-depth basis risk analysis to maximize benefit to Ariel Re
  • Finalizing investor presentation and offering documents
  • Managing marketing process