Southland Holdings, Inc. 8-K

What Happened
Southland Holdings, Inc. announced in an 8‑K (filed Jan 16, 2026) that Zurich Insurance Company Ltd., a surety for the company, has advanced approximately $15 million under a general indemnity agreement (GIA) to pay bonded construction contract obligations and support project progress. As of the filing date, Southland is legally obligated to indemnify and reimburse Zurich for those advances. The company is working with Callodine Commercial Finance, LLC (as agent) and the lenders under its Term Loan and Security Agreement (originally dated Sept 30, 2024, amended March 3, 2025) to determine the impact of the advances on the Credit Agreement and to seek additional surety funds and a long‑term financing arrangement.

Key Details

• Surety: Zurich Insurance Company Ltd. has advanced ≈ $15,000,000 under a general indemnity agreement.
• Indemnity: Southland is obligated to indemnify and reimburse the surety for the advanced funds.
• Financing partners: Company is working with Callodine Commercial Finance, LLC (agent) and the lenders under the Term Loan and Security Agreement (dated Sept 30, 2024; amended Mar 3, 2025).
• Next steps/uncertainty: Southland is seeking advancement of additional surety funds and a long‑term financing solution, but “there can be no assurances” a resolution will be reached.

Why It Matters
This filing highlights a material cash‑flow and credit issue: the company has third‑party surety advances of about $15M that it must repay, which could affect liquidity and its borrowing arrangements under the existing Credit Agreement. Investors should note the company is negotiating with its lenders and sureties to secure additional surety support and a longer‑term financing plan; however, the outcome is uncertain. The situation may influence the company’s ability to complete bonded projects, meet project obligations, and maintain access to surety capacity and credit.