Debt

12 Months Ended

Dec. 31, 2020

The following is a summary of the Company's outstanding debt as of December 31:


(Amounts in millions, except percentages)	2020		2019
7.00% first lien credit facility due 2023	$	635.3	$	641.8
13.00% second lien credit facility due 2024	254.6		251.4
Senior secured credit facilities	889.9		893.2
Unamortized debt issuance costs and debt discounts	(32.1)		(42.9)
Total debt, net	$	857.8	$	850.3

First Lien Credit Agreement and Revolving Credit Facility — The First Lien Credit Agreement provides for (a) a senior secured three-year revolving credit facility that may be used for revolving credit loans, swingline loans and letters of credit up to an aggregate principal amount of $35.0 million (the "First Lien Revolving Credit Facility") and (b) a senior secured four-year term loan facility in an aggregate principal amount of $645.0 million (the "First Lien Term Credit Facility" and together with the First Lien Revolving Credit Facility, the "First Lien Credit Facility").

The First Lien Credit Agreement provides that in the event the Company's cash balance exceeds $130.0 million at the end of any month, the Company would be required to use such excess cash to pay any outstanding obligations to the revolving lenders under our First Lien Revolving Credit Facility, and that the Company may not draw on the First Lien Revolving Credit Facility to the extent that the Company would have a cash balance in excess of $130.0 million after giving effect to such borrowing. As

of December 31, 2020, the Company had no borrowings and nominal outstanding letters of credit under the First Lien Revolving Credit Facility.

Second Lien Credit Agreement — The Second Lien Credit Agreement provides for a second lien secured five-year term loan facility in an aggregate principal amount of $245.0 million (the "Second Lien Term Credit Facility" and together with the First Lien Credit Facility, the "Credit Facilities"). Subject to certain conditions and limitations, the Company may elect to pay interest under the Second Lien Term Credit Facility partially in cash and partially in kind. The outstanding principal balance for the Second Lien Credit Agreement is due on the maturity date.

The Credit Facilities are secured by substantially all of the Company's assets and its material domestic subsidiaries that guarantee the payment and performance of the Company's obligations under the Credit Facilities.

In connection with the entry into the Second Lien Credit Agreement, the Company issued warrants (“Second Lien Warrants”) exercisable for an aggregate of 5,423,470 shares of the Company’s common stock, par value $0.01, to the lenders under the Second Lien Credit Agreement. As of the issuance date, the value of each Second Lien Warrant was estimated at $2.41 per share. Each Second Lien Warrant will expire ten years after issuance and entitles the holder thereof to purchase the number of shares of common stock underlying such Second Lien Warrant for $0.01 per share. Each Second Lien Warrant will become exercisable upon the earlier of either (i) immediately prior to a change in control, (ii) the repayment in full of all amounts outstanding under the Second Lien Credit Agreement, (iii) the maturity date under the Second Lien Credit Agreement or (iv) the occurrence and continuance of a default under the Second Lien Credit Agreement (but only during the continuance of a default).

Debt Covenants and Other Restrictions — The Credit Facilities contain various limitations that restrict the Company's ability to: incur additional indebtedness; create or incur additional liens; effect mergers and consolidations; make certain acquisitions or investments; sell assets or subsidiary stock; pay dividends and make other restricted payments; and effect loans, advances and certain other transactions with affiliates. In addition, the First Lien Revolving Credit Facility requires the Company and its consolidated subsidiaries (w) to maintain a minimum interest coverage ratio, (x) to maintain a minimum asset coverage ratio, (y) to not exceed a maximum first lien leverage ratio and (z) to not exceed a total leverage ratio. The First Lien Credit Facility requires the company to not exceed a maximum first lien leverage ratio of 4.00:1.00 and the Second Lien Credit Facility requires the Company to not exceed a maximum secured leverage ratio of 5.50:1.00, commencing September 30, 2019.

The asset coverage covenant contained in the First Lien Credit Agreement requires the aggregate amount of the Company's cash and cash equivalents and other settlement assets to exceed its aggregate payment service obligations. The Company's assets in excess of payment service obligations used for the asset coverage calculation were $196.1 million and $146.8 million as of December 31, 2020 and December 31, 2019, respectively. The table below summarizes the Revolver Financial Covenants Under the First Lien Credit Agreement, the interest coverage, first lien and total leverage ratio covenants, which are calculated based on the four-fiscal quarter period ending on each quarter end beginning September 30, 2019 through the maturity of the First Lien Credit Facility:

Interest Coverage Minimum Ratio

First Lien Leverage Ratio Not to Exceed

Total Leverage Ratio Not to Exceed

July 1, 2019 through June 30, 2020

2.50:1

3.750:1

5.125:1

July 1, 2020 through December 31, 2020

2.50:1

3.500:1

5.000:1

January 1, 2021 through maturity

2.50:1

3.000:1

4.500:1

As of December 31, 2020, the Company was in compliance with its financial covenants: our interest coverage ratio was 3.276 to 1.00, our first lien leverage ratio was 2.503 to 1.00 and our total leverage ratio was 3.505 to 1.00. We continuously monitor our compliance with our debt covenants.

Debt Issuance Costs —For the First Lien Term Credit Facility and the Second Lien Term Credit Facility, the Company presents debt issuance costs as a direct deduction from the carrying amount of the related indebtedness and amortizes these costs over the term of the related debt liability using the effective interest method. For the First Lien Revolving Credit Facility, the Company presents debt issuance costs within "Other assets" on its consolidated Balance Sheets and amortizes these costs ratably over the term of the First Lien Revolving Credit Facility. Amortization of debt issuance costs is recorded within "Interest expense" on the Consolidated Statements of Operations.

The unamortized costs associated with the First Lien Revolving Credit Facility were $1.5 million and $2.4 million as of December 31, 2020 and 2019, respectively.

Debt Discount — The Company records debt discount as a deduction from the carrying amount of the related indebtedness on its Consolidated Balance Sheets with the respective debt discount amortization recorded within "Interest expense."

Debt Extinguishment Costs — In 2019, the Company recognized debt extinguishment costs of $2.4 million in connection with the termination of the First Lien Revolving Credit Facility which are recorded within "Other non-operating expense (income)" on the Consolidated Statements of Operations. There were no debt extinguishment costs recognized in 2020 or 2018.

Maturities — At December 31, 2020, debt totaling $619.2 million and $254.6 million will mature in June 2023 and June 2024, respectively, while debt principal totaling $16.1 million will be paid quarterly in increments of approximately $1.6 million through the maturity date. Any borrowings under the First Lien Revolving Credit Facility will mature in September 2022.