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Debt and Finance Lease Obligations | 3 Months Ended
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Mar. 31, 2023
Debt Disclosure [Abstract] |
Debt and Finance Lease Obligations | Note 12. Debt and Finance Obligations The components of debt and finance obligations consisted of the following:
|  | March 31, |  |  | December 31, |
(in thousands, except interest rates) |  | 2023 |  |  | 2022 |
2021 Credit Facility - Term Loan B, 9.9% interest rate at March 31, 2023 and 9.4% at December 31, 2022, due through 2028(1) |  | $ | 394,000 |  |  | $ | 395,000 |
Forest Park Hotel Construction Loan, 6.5% interest rate at March 31, 2023 and 8.8% at December 31, 2022, due through 2028(1) |  |  | 12,400 |  |  |  | 11,491 |
FlyOver Iceland Credit Facility, 7.7% interest rate at March 31, 2023 and 6.9% at December 31, 2022, due through 2027(1) |  |  | 4,742 |  |  |  | 4,965 |
FlyOver Iceland Term Loans, 11.8% weighted-average interest rate at March 31, 2023 and 10.1% at December 31, 2022, due through 2024(1) |  |  | 564 |  |  |  | 594 |
Less unamortized debt issuance costs |  |  | (10,757 | ) |  |  | (11,848 | )
Total debt |  |  | 400,949 |  |  |  | 400,202 |
Finance lease obligations, 9.1% weighted-average interest rate at March 31, 2023 and December 31, 2022, due through 2067 |  |  | 64,538 |  |  |  | 64,729 |
Financing arrangements |  |  | 2,178 |  |  |  | 5,013 |
Total debt and finance obligations (2)(3) |  |  | 467,665 |  |  |  | 469,944 |
Current portion |  |  | (10,751 | ) |  |  | (13,192 | )
Long-term debt and finance obligations |  | $ | 456,914 |  |  | $ | 456,752 |
(1) Represents the weighted-average interest rate in effect as of the end of the respective periods, including any applicable margin. The interest rates do not include amortization of debt issuance costs or commitment fees. (2) The estimated fair value of total debt and finance leases was $318.1 million as of March 31, 2023 and $301.8 million as of December 31, 2022. The fair value of debt was estimated by discounting the future cash flows using rates currently available for debt of similar terms and maturity, which is a Level 2 measurement. Refer to Note 14 – Fair Value Measurements. (3) Cash paid for interest on debt was $11.4 million during the three months ended March 31, 2023 and $7.0 million during the three months ended March 31, 2022. 2021 Credit Facility Effective July 30, 2021, we entered into a $500 million credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provides for a $400 million term loan (“Term Loan B”) and a $100 million revolving credit facility (“Revolving Credit Facility”). The proceeds of the Term Loan B, net of $14.8 million in related fees, were used to repay the $327 million outstanding balance under our then $450 million revolving credit facility and to provide for financial flexibility to fund future acquisitions and growth initiatives and for general corporate purposes. LIBOR Transition Amendment On February 6, 2023, we entered into the LIBOR Transition Amendment to the 2021 Credit Facility to replace the London Interbank Offered Rate (“LIBOR”) with the Secured Overnight Financing Rate (“SOFR”). In accordance with the LIBOR replacement provisions outlined in the 2021 Credit Facility, additional credit spread adjustments apply to SOFR ranging from 0.11448% (for a one-month duration) up to 0.71513% (for a 12-month duration). Term Loan B The Term Loan B has a maturity date of July 30, 2028 and is subject to quarterly amortization of principal of $1.0 million. Interest rates are based on SOFR (plus additional credit spread adjustments as detailed above under “LIBOR Transition Amendment”) plus a 5.00% credit spread, with a SOFR floor of 0.50%. The Term Loan B carries no financial covenants. As discussed in Note 13 – Derivative, we entered into an interest rate cap agreement that manages our exposure to interest rate increases on $300 million in borrowings and provides us with the right to receive payment if the one-month SOFR exceeds 5.0% (“strike rate”). Revolving Credit Facility The Revolving Credit Facility has a maturity date of July 30, 2026. As of March 31, 2023, capacity remaining under the Revolving Credit Facility was $89.1 million, reflecting $100.0 million total facility size, less $10.9 million in outstanding letters of credit. In addition to borrowing based on one, three, six, or twelve month SOFR tenors (plus additional credit spread adjustments as detailed above under “LIBOR Transition Amendment”), we also have the option to borrow based on the “Base Rate”, which for any day is a fluctuating rate equal to the highest of the Fed Funds Rate plus 0.50%, Bank of America’s publicly announced “prime rate”, and SOFR plus 1.00%. Credit spreads for SOFR and Base Rate borrowings are based on Viad’s total net leverage ratio and range from 2.50% to 3.50% for SOFR borrowings and from 1.50% to 3.50% for Base Rate borrowings. Additionally, a 1.00% floor applies to the Bate Rate. The Revolving Credit Facility includes an undrawn fee ranging from 0.30% to 0.50% that is based on Viad’s total net leverage ratio. The Revolving Credit Facility carries financial covenants. On March 23, 2022, we entered into the First Amendment to the 2021 Credit Facility and on March 28, 2023, we entered into the Second Amendment to the 2021 Credit Facility. The amendments modified the financial covenants to the following: • Maintain a total net leverage ratio of not greater than 4.50 to 1.00 at March 31, 2023 and 4.00 to 1.00 at June 30, 2023 and thereafter; and • Maintain an interest coverage ratio of not less than 2.0 to 1.00. As of March 31, 2023, our total net leverage ratio was 2.83 to 1.00, the interest coverage ratio was 3.48 to 1.00, and we were in compliance with all covenants under the Revolving Credit Facility. In addition to U.S. dollar borrowings, we may borrow funds on the Revolving Credit Facility in Canadian Dollars based on the Canadian Dollar Offered Rate, Pound Sterling based on the Sterling Overnight Index Average, and Euros based on the Euro Interbank Offered Rate, plus applicable credit spreads. No such borrowings had been made as of March 31, 2023. Forest Park Hotel Construction Loan Facility Effective May 17, 2022, Pursuit, through a 60% owned subsidiary, entered into a construction loan facility for borrowings up to $17.0 million Canadian dollars for the development and construction of the Forest Park Hotel in Jasper National Park. Construction of the hotel was completed in August 2022. During January 2023, we completed our final borrowing under the construction loan facility bringing the total amount borrowed to approximately $16.8 million Canadian dollars. The construction loan facility required interest only payments at Canada Prime plus 2.35% through January 31, 2023, at which time it was converted to a 6.5% fixed rate term loan. The term loan matures on February 1, 2028 and requires interest only payments through July 31, 2024. FlyOver Iceland Credit Facility Effective February 15, 2019, FlyOver Iceland ehf., (“FlyOver Iceland”) a wholly-owned subsidiary of Esja, entered into a credit agreement with a €5.0 million (approximately $5.6 million U.S. dollars) credit facility (the “FlyOver Iceland Credit Facility”) with an original maturity date of March 1, 2022. The loan proceeds were used to complete the development of the FlyOver Iceland attraction. The loan bears interest at the three month Euro Interbank Offered Rate plus 4.9%. FlyOver Iceland entered into an addendum effective December 1, 2021 wherein the principal payments were deferred for twelve months beginning December 1, 2021, with the first payment due December 1, 2022. The addendum extended the maturity date to March 1, 2025, which was further extended to September 1, 2027 by way of an option as permitted in the addendum, and provided for a semi-annual waiver of certain covenants through June 30, 2022 with the first testing date as of December 31, 2022. Conditions to the addendum included securing additional capital of ISK 75.0 million (approximately $0.6 million) in January 2022, which was completed, in order to strengthen FlyOver Iceland’s liquidity position. There were no other changes to the terms of the FlyOver Iceland Credit Facility. Effective November 2, 2022, FlyOver Iceland received a financial covenant waiver for the 2022 through 2023 testing periods. FlyOver Iceland Term Loans During 2020, FlyOver Iceland entered into three term loans totaling ISK 90.0 million (approximately $0.7 million U.S. dollars) (the “FlyOver Iceland Term Loans”). The first term loan for ISK 10.0 million was entered into effective October 15, 2020 with a maturity date of April 1, 2023 and bears interest on a seven-day term deposit at the Central Bank of Iceland. The second term loan for ISK 30.0 million was entered into effective October 15, 2020 with a maturity date of October 1, 2024 and bears interest on a seven-day term deposit at the Central Bank of Iceland plus 3.07%. The third term loan for ISK 50.0 million was entered into effective December 29, 2020 with an original maturity date of February 1, 2023 and bears interest at one-month Reykjavik InterBank Offered Rate (“REIBOR”) plus 4.99%. Effective November 23, 2022, FlyOver Iceland entered into an amendment to the ISK 50.0 million term loan wherein the maturity date was extended to February 1, 2024. The Icelandic State Treasury guarantees supplemental loans provided by credit institutions to companies impacted by the COVID-19 pandemic. Accordingly, the Icelandic State Treasury guaranteed the repayment of up to 85% of the principal and interest on the ISK 10.0 million and ISK 30.0 million term loans and 70% of the principal amount on the ISK 50.0 million term loan. Loan proceeds were used to fund FlyOver Iceland operations. Financing arrangements We entered into insurance premium financing arrangements with two financial intermediaries in order to finance certain of our insurance premium payments. The financing arrangements are payable within the next 12 months and bear a weighted average interest rate of 4.9%. The aggregate amount of premiums financed was $9.5 million with a remaining principal balance of $2.2 million as of March 31, 2023.

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