Borrowings

9 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Borrowings

9. Borrowings

As of March 31, 2023, the Company did not have any outstanding related party borrowings. Related party borrowings of the Company's subsidiaries as of June 30, 2022, are summarized in the following table:

(in thousands)	Borrower	June 30, 2022
Seller Note	GECM	$	6,270
Total principal		$	6,270
Unamortized debt issuance cost			-
Total related party notes payable			6,270
Less current portion of related party notes payable			-
Related party notes payable, net of current portion		$	6,270

The Company’s and subsidiaries’ other outstanding borrowings are summarized in the following table:

(in thousands)	Borrower	March 31, 2023			June 30, 2022
GEGGL Notes	GEG	$	26,945		$	26,945
Total principal		$	26,945		$	26,945
Unamortized debt discounts and issuance costs			(1,208	)		(1,413	)
Long term debt			25,737			25,532

During the three and nine months ended March 31, 2023, the Company incurred interest expense of $0.6 million and $1.9 million, respectively, on related-party and other borrowings. During the three and nine months ended March 31, 2022, the Company did not have any related-party or other borrowings. See Note 10 – Convertible Notes for interest expense on Convertible Notes and Note 11 – Non-Controlling Interests and Redeemable Preferred Stock of Subsidiaries for interest expense on the preferred stock of subsidiaries.

The Company’s aggregate future required principal debt repayments are summarized in the following table:

(in thousands)	Principal Due
For the three months ending June 30, 2023	$	-
For the year ending June 30, 2024		-
For the year ending June 30, 2025		-
For the year ending June 30, 2026		-
For the year ending June 30, 2027		26,945
Thereafter		-
Total	$	26,945

Additional details of each borrowing are discussed below.

Seller Note

On May 4, 2022 as part of the consideration paid to acquire the Monomoy UpREIT investment management agreement, GECM issued ICAM a $6.3 million promissory note (the Seller Note). The Seller Note was due on August 4, 2023 and had no prepayment penalties. The Seller Note bore interest of 6.5% per annum, which was paid quarterly.

In August and December 2022, the Company settled the principal amount of $0.6 million and $2.0 million, respectively, by transferring 50,000 and 200,000 shares of GECC stock, respectively. In February 2023, the Company repaid the remaining principal of $3.7 million in full.

GEGGL Notes

On June 9, 2022, we issued $26.9 million in aggregate principal amount of 7.25% notes due 2027 (the GEGGL Notes), which included $1.9 million of GEGGL Notes issued in connection with the partial exercise of the underwriters’ over-allotment option. The GEGGL Notes are unsecured obligations and rank: (i) pari passu, or equal, with the Convertible Notes and any future outstanding unsecured unsubordinated indebtedness; (ii) senior to any of our indebtedness that expressly provides it is subordinated to the GEGGL Notes; (iii) effectively subordinated to any future secured indebtedness; and (iv) structurally subordinated to any future indebtedness and other obligations of any of our current and future subsidiaries. We pay interest on the GEGGL Notes on March 31, June 30, September 30 and December 31 of each year. The GEGGL Notes will mature on June 30, 2027. The GEGGL Notes can be called on, or after, June 30, 2024. Holders of the GEGGL Notes do not have the option to have the notes repaid prior to the stated maturity date. The GEGGL Notes were issued in minimum denominations of $25 and integral multiples of $25 in excess thereof.

The GEGGL Notes include covenants that limit additional indebtedness or the payment of dividends subject to compliance with a net consolidated debt to equity ratio of 2:1. As of March 31, 2023 our net consolidated debt to equity ratio is -0.29:1.00.