Debt

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Debt

Debt

The Company maintains a senior secured syndicated credit facility, dated August 5, 2014, among Ebix, Inc., as borrower, its subsidiaries party thereto from time to time as guarantors, Regions Bank (as administrative agent and collateral agent) and the lenders party thereto from time to time (as amended from time to time, the "Credit Facility") that provides a $450 million revolving line of credit (the "Revolver") as well as a term loan (the "Term Loan"), which at June 30, 2023 had a balance of $171.9 million. The Credit Facility was set to mature on February 2023; however, in May 2023, the company entered into Amendment No. 14 to its Credit Facility, which provides for, among other things, an extension of the maturity date from May 23, 2023 to September 30, 2023 ("Credit Facility Maturity Date"), as discussed in more details below. At June 30, 2023 the outstanding balance of the Credit Facility, $616.8 million, was classified as a current liability. The Company expects to address the Credit Facility maturity prior to the Credit Facility Maturity Date, and intends to do so in conjunction with the resolution of the anticipated IPO of EbixCash, as further described within Item 2 "Management's Discussion and Analysis of Financial Conditions and Results of Operations - Liquidity and Capital Resources". The refinancing of the Credit Facility will require the Company to successfully access the debt and/or equity capital markets in the U.S. or internationally. However, there are no assurances that such financing will be available in amounts or on terms acceptable to us, if at all, or that the proceeds received by Ebix, Inc. from the IPO of EbixCash will be in the amount currently expected. Further, no assurances can be given when the IPO will be completed, if at all, or if it will be completed on terms acceptable to the Company.

On July 21, 2023, the Company entered into an amendment No. 15 that specifically provided for, among other things, the deletion of the event of default deadline for the mandatory public opening of subscription to investors of the shares of the Company’s subsidiary EbixCash on the Indian stock market on or by prior to July 31, 2023. Also, Amendment 15 that changed the possible additional amendment fee (the “Amendment Fee”) that had been included as part of Amendment No. 14, as discussed below, from an amount equal to 1.50% of the aggregate principal amount of the outstanding term loan (the “Term Loan and the lenders’ commitments under the revolving line of credit (the “Revolver”), whether or not utilized, to 2%. The Amendment Fee will be waived if all of the Revolver has been terminated and the Term Loan and all other obligations due the lenders are fully repaid on or before August 31, 2023.

On May 23, 2023, the company signed an amendment (“Amendment No. 14”) to its existing credit agreement, extending the maturity date to September 30, 2023. Amendment No. 14 provided for, among other things, an extension of the maturity date for both the Revolver and the term loan the Term Loan, each as existing under the Credit Agreement. It was conditioned, among other things, upon the Company (i) making a $5,000,000 payment of the Term Loan by June 30, 2023 and (ii) paying a customary consent fee which will be payable over time and partially waived if certain conditions are met.

Amendment No. 14 also specifically provided for the application of a certain percentage of the proceeds from certain liquidity events towards payment of outstanding principal and interest obligations at that time. These events would have included the public listing of the shares of the Company’s subsidiary EbixCash on the Indian stock market by July 31, 2023, the proceeds from the issuance of any additional debt and/or securities if raised by the Company and the proceeds from the monetization of any asset sale, if carried out by the Company.

Amendment No. 14 (i) increased the applicable margin for the facilities under the Credit Agreement to (x) 7.50% per annum for SOFR loans and letter of credit fees, (y) 6.50% per annum for base rate loans, and (ii) further increases the applicable margin for the facilities under the Credit Agreement on August 31, 2023 to (x) 8.00% per annum for SOFR loans and letter of credits fees, and (y) 7.00% per annum for base rate loans. Amendment 14 also included the Amendment Fee of 1.50%.

On February 21, 2023, the company entered into Amendment No. 13 to its Credit Facility, which provides for, among other things, an extension of the maturity date from February 21, 2023 to May 23, 2023 ("Credit Facility Maturity Date"). Amendment No. 13 to the Credit Facility required the Company to make a $5 million prepayment of the Revolver on February, 21, 2023 and a $5 million amortization payment on the Term Loan on March 31, 2023. Any repayments under the Revolver will be accompanied by a corresponding reduction in the aggregate revolving commitments. Lastly, amendment No. 13 modified certain other provisions within the Credit Agreement and has resulted in an approximately 1% per annum interest rate increase beginning February 21, 2023.

On April 9, 2021, The Company entered into Amendment No. 12 to its Credit Facility. Amendment No. 12 provided for, among other things, a waiver of any potential event of default arising under the Credit Facility from the failure to timely deliver the Company's audited financial consolidated financial statements and related compliance certificate for the year ended December 31, 2020, provided that there is no good faith determination by the requisite lenders under the Credit Facility of a "Material Circumstance" (as defined and further described in Amendment No. 12), which determination (if any) may only be made within a specified period described in Amendment No. 12 and is subject to certain cure rights of the Company. Amendment No. 12 also modified the applicable margin that applies from the date of the amendment forward, modified certain mandatory prepayment provisions, as well as certain other covenants related to restricted payments, investments and certain reporting requirements.

On March 31, 2021, Ebix entered into Amendment No. 11 to the Credit Facility. Amendment No. 11 provided, for, among other things, a limited waiver through April 10, 2021, of any potential event of default arising under the Credit Facility from failure to deliver the Company's audited consolidated financial statements and related compliance certificate for the year ended December 31, 2020. Amendment No. 11 also modified certain covenants contained in the Credit Facility, including with respect to certain permitted restricted payments and investments.

As of June 30, 2023, the Company's condensed consolidated balance sheets include $2.3 million of remaining deferred financing costs in connection with the Credit Facility, which are being amortized as a component of interest expense through the Credit Facility Maturity Date. $1.4 million of such deferred financing costs pertain to the Revolver, and $0.9 million pertains to the Term Loan, which is netted against the current portion of the Term Loan as reported on the condensed consolidated balance sheets. At December 31, 2022, the Company's Consolidated Balance Sheets included $1.2 million of remaining deferred financing costs in connection with the Credit Facility, with $0.7 million pertaining to the Revolver, and $0.5 million pertaining to the Term Loan, of which $0.5 million was netted against the current portion of the Term Loan.

    As of June 30, 2023, the outstanding balance on the Revolver was $444.9 million and the Revolver carried an interest rate of 11.95% at June 30, 2023. The balance on the Revolver is included in the current liabilities section of the condensed consolidated balance sheets. During the six months ended June 30, 2023, the average and maximum outstanding balances of the revolving line of credit component of the Credit Facility were both $444.9 million. At December 31, 2022, the outstanding balance on the Revolver was $449.9 million and the Revolver carried an interest rate of 9.69%.

    As of June 30, 2023, the outstanding balance on the Term Loan was $171.9 million, of which $171.9 million is due within the next twelve months. $17.5 million of principal payments were made during the six months ended June 30, 2023, of which $0.0 million were scheduled amortization payments. This Term Loan also carried an interest rate of 11.95% at June 30, 2023. The Term Loan is included in the current liabilities section of the condensed consolidated balance sheets at June 30, 2023. At December 31, 2022, the outstanding balance on the Term Loan was $189.4 million, of which $189.4 million was due within twelve months. The Term Loan also carried an interest rate of 9.69% at December 31, 2022.

    The Company maintains working capital debt facilities with banks in international markets for working capital funding requirements to support our foreign exchange and payment remittance businesses. We are required to extend short term credits to franchisee networks (B2B) and corporate customers. Additionally we are required to maintain minimum levels of foreign currency inventory across branches and airport operations. Typically, these facilities carry interest rates of 9.00% to 10%, are rupee-denominated working capital lines, and are collateralized against the receivables of these businesses and existing foreign currency inventory on hand.

    As of June 30, 2023 and December 31, 2022, the total of these working capital facilities was $5.0 million and $3.4 million, respectively, and is included in current liabilities in the Company's condensed consolidated balance sheets.