Debt Obligations

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Debt Obligations

Note 12. Debt Obligations

Debt obligations consists of the following:

	As of			As of
	March 31,			December 31,
	2023			2022
Revolver facility	$	77,900		$	80,900
Debt issuance costs		(2,552	)		(2,783	)
Revolver facility, net	$	75,348		$	78,117
Term Loan	$	209,844		$	212,500
Debt issuance costs		(1,295	)		(1,393	)
Term loan, net	$	208,549		$	211,107
Total debt obligations	$	283,897		$	289,224

	March 31, 2023
										Weighted
	Maturity Date	Aggregate Facility Size		Outstanding Debt		Amount Available		Net Carrying Value		Average Interest Rate
Term Loan	12/22/2025	$	212,500	$	209,844	$	—	$	208,549		6.62	%
Revolver Facility	12/22/2025		162,500		77,900		84,600		75,348		6.20	%
Total		$	375,000	$	287,744	$	84,600	$	283,897

Revolving Credit Facility State Tax Credits

Enhanced State Tax Credit Fund III, LLC, a subsidiary of ECG, had a $10 million revolving credit facility with a regional financial institution restricted solely for the purchase of allocable state tax credits from various state tax credit incentive programs. The facility bore interest at 0.25% above the Prime Rate and matured on June 15, 2022. The facility was not renewed upon maturity.

Revolving Credit Facility and Term Loan

On December 22, 2021, the Company entered into a new credit agreement (the "Credit Agreement") with JPMorgan, in its capacity as administrative agent and collateral agent, and Texas Capital Bank, as joint lead arrangers and joint bookrunners, and the other loan parties party thereto. The Credit Agreement consists of two facilities. The first is a revolving credit facility with an available balance of $125 million (the "Revolver Facility"). The second is a term loan for $125 million (the "Term Loan"). In addition to the Term Loan and Revolver Facility, the Credit Agreement also includes a $125 million accordion feature. In October 2022, the accordion feature was exercised with the acquisition of WTI at which point it was split into $87.5 million worth of term loan and $37.5 million of revolver.

Both facilities are "Term SOFR Loans" meaning loans bearing interest based upon the "Adjusted Term SOFR Rate". The Adjusted Term SOFR Rate is the Secured Overnight Financing Rate ("SOFR") at the date of election, plus 2.10%. The Company can elect one or three months for the Revolver Facility and three or six months for the Term Loan. Principal is contractually repaid at a rate of 1.25% on the term loan quarterly effective March 31, 2023. The Revolving Credit Facility has no contractual principal repayments until maturity, which is December 22, 2025 for both facilities. Certain P10 subsidiaries are encumbered by this debt agreement.

The Credit Agreement contains affirmative and negative covenants typical of such financing transactions, and specific financial covenants which require P10 to maintain a minimum leverage ratio. As of March 31, 2023, P10 was in compliance with its financial covenants required under the facility. As of March 31, 2023, the balance drawn on the revolving credit facility is $77.9 million and on the term loan, the balance is $209.8 million. The balance as of December 31, 2022 was $80.9 million on the revolving credit facility and $212.5 million on the term loan. For the three months ended March 31, 2023 and March 31, 2022, $4.8 million and $0.9 million of interest expense was incurred, respectively.

Debt Payable

Future principal maturities of debt as of March 31, 2023 are as follows:

2023	$	7,969
2024		10,625
2025		269,150
	$	287,744

Debt Issuance Costs

Debt issuance costs are offset against the Revolver Facility and Term Loan. Unamortized debt issuance costs for the Revolver Facility and Term Loan as of March 31, 2023 and December 31, 2022 were $3.8 million and $4.2 million, respectively.

Amortization expense related to debt issuance costs totaled $0.3 million for the three months ended March 31, 2023 and $0.2 million for the three months ended March 31, 2022. This is reported in interest expense, net on the Consolidated Statements of Operations. During the three months ended March 31, 2023 and March 31, 2022, we recorded $0 and $8 thousand in debt issuance costs, respectively, which is included in debt obligations on the Consolidated Balance Sheets.