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Debt and Finance Obligations | 9 Months Ended
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Sep. 30, 2024
Debt Disclosure [Abstract] |
Debt and Finance Obligations | Note 11. Debt and Finance Obligations The components of debt and finance obligations consisted of the following:
|  | September 30, |  |  | December 31, |
(in thousands, except interest rates) |  | 2024 |  |  | 2023 |
Debt: |  |  |  |  |  |
2021 Credit Facility - Term Loan B 9.1% interest rate at September 30, 2024 and 10.5% at December 31, 2023, due through 2028 (1) |  | $ | 318,000 |  |  | $ | 321,000 |
2021 Credit Facility - Revolving Credit Facility - Viad Corp borrowings 8.5% interest rate at December 31, 2023, due through 2026 (1) |  |  | — |  |  |  | 57,000 |
Jasper Term Loan 6.5% interest rate at September 30, 2024 and December 31, 2023, due through 2028 (1) |  |  | 12,376 |  |  |  | 12,655 |
Jasper Revolving Credit Facility 9.5% weighted-average interest rate at December 31, 2023, due through 2028 (1) |  |  | — |  |  |  | 3,020 |
FlyOver Iceland Credit Facility 9.0% interest rate at September 30, 2024 and 8.9% at December 31, 2023, due through 2029 (1) |  |  | 3,902 |  |  |  | 4,049 |
FlyOver Iceland Term Loans 12.3% weighted-average interest rate at September 30, 2024 and 13.8% at December 31, 2023, due through 2024 (1) |  |  | 11 |  |  |  | 475 |
Less unamortized debt issuance costs |  |  | (8,001 | ) |  |  | (9,453 | )
Total debt |  |  | 326,288 |  |  |  | 388,746 |
Finance obligations: |  |  |  |  |  |
Finance lease obligations (2) 9.2% weighted-average interest rate at September 30, 2024 and December 31, 2023, due through 2067 |  |  | 63,197 |  |  |  | 63,929 |
Financing arrangements |  |  | 716 |  |  |  | — |
Total debt and finance obligations (3)(4) |  |  | 390,201 |  |  |  | 452,675 |
Current portion |  |  | (8,314 | ) |  |  | (8,371 | )
Long-term debt and finance obligations |  | $ | 381,887 |  |  | $ | 444,304 |
(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, commitment fees, or any expense or income related to the Interest Rate Cap as discussed in Note 12 – Derivative. (2) Refer to Note 20 – Leases and Other for additional information. (3) The estimated fair value of total debt and finance leases was $318.4 million as of September 30, 2024 and $349.8 million as of December 31, 2023. 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 13 – Fair Value Measurements for additional information. (4) Cash paid for interest on debt was $36.1 million during the nine months ended September 30, 2024 and $35.7 million during the nine months ended September 30, 2023. 2021 Credit Facility Effective July 30, 2021, we entered into a $500 million credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provided 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 prior $450 million revolving credit facility and to provide for financial flexibility to fund future acquisitions and growth initiatives and for general corporate purposes. On October 6, 2023, we entered into the Third Amendment to the 2021 Credit Facility, which among other things, increased the principal amount of the Revolving Credit Facility by $70 million, bringing the total amount of revolving capacity to $170 million, and added Brewster Inc., an Alberta corporation and a wholly-owned subsidiary of the Company, as a co-borrower. In connection with the amendment, we prepaid $70 million of the outstanding balance on our existing Term Loan B using $60 million from the Revolving Credit Facility, which has a lower credit spread as discussed below, and $10 million of cash from the Company’s balance sheet. 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”) for U.S. dollar borrowings on our Term Loan B and Revolving Credit Facility. 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). As discussed below under “Term Loan B”, those additional credit spread adjustments were eliminated for our Term Loan B borrowings with the Fourth Amendment to the 2021 Credit Facility (as discussed below), but remain in place for borrowings under our Revolving Credit Facility. CDOR Transition Amendment On June 28, 2024, we entered into the Canadian Benchmark Replacement Conforming Changes Amendment (“CDOR Transition Amendment”) to the 2021 Credit Facility to replace the Canadian Dollar Offered Rate (“CDOR”) with the Canadian Overnight Repo Rate Average (“CORRA”) for Canadian dollar borrowings on our revolver. Additional credit spread adjustments apply to CORRA ranging from 0.29547% (for a one-month duration) up to 0.32138% (for a three-month duration). Term Loan B The Term Loan B has a maturity date of July 30, 2028, is subject to quarterly amortization of principal of $1.0 million, and carries no financial covenants. Interest rates are based on SOFR plus a credit spread, with a SOFR floor of 0.50%. On April 26, 2024, we entered into the Fourth Amendment to the 2021 Credit Facility, which among other things, (i) reduced the SOFR credit spread from 5.00% to 4.25% on the Term Loan B and (ii) set the additional credit spread adjustments to 0% on the Term Loan B. As discussed in Note 12 – Derivative, we entered into an interest rate cap agreement that manages our exposure to interest rate increases on $300 million of borrowings under the 2021 Credit Facility or other SOFR-based 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 and 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. These amendments modified the financial covenants to the following: • Maintain a total net leverage ratio of not greater than 4.00 to 1.00; and • Maintain an interest coverage ratio of not less than 2.00 to 1.00. As of September 30, 2024, our total net leverage ratio was 1.65 to 1.00, the interest coverage ratio w as 4.13 to 1.00, and we were in compliance with all covenants under the Revolving Credit Facility. Interest rates for U.S. dollar borrowings on our Revolving Credit Facility are based on SOFR (plus additional credit spread adjustments as detailed above under “LIBOR Transition Amendment”). We also have the option to borrow U.S. funds based on the “Base Rate”, which for any day is the highest of the Fed Funds Rate plus 0.50%, Bank of America’s publicly announced “prime rate,” and SOFR plus 1.00%. Interest rates for Canadian dollar borrowings on our Revolving Credit Facility are based on CORRA (plus additional credit spread adjustments as detailed above under “CDOR Transition Amendment”). We also have the option to borrow Canadian funds based on the “Canadian Prime Rate”, which for any day is the higher of the per annum rate of interest designated by Bank of America (acting through its Canada branch) from time to time as its prime rate for commercial loans made by it in Canada in Canadian dollars, and the CORRA Rate for a one-month Interest Period as of such day, plus 1.00%. Credit spreads for borrowings on our Revolving Credit Facility are based on Viad’s total net leverage ratio and range from 2.50% to 3.50% for SOFR and CORRA borrowings and from 1.50% to 2.50% for Base Rate and Canadian Prime Rate borrowings. Additionally, a 1.00% floor applies to the Base Rate and a 0% floor applies to the Canadian Prime 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. As of September 30, 2024, capacity remaining under the Revolving Credit Facility was $164.3 million, reflecting $170 million total facility size, less $5.7 million in outstanding letters of credit. In addition to U.S. dollar borrowings and Canadian dollar borrowings, we may also borrow funds on the Revolving Credit Facility in Pound Sterling based on the Sterling Overnight Index Average and Euros based on the Euro Interbank Offered Rate (“EURIBOR”), plus applicable credit spreads. No such borrowings had been made as of September 30, 2024. Jasper Credit Facility Effective May 16, 2023, Pursuit entered into a $27.0 million Canadian dollar (approximately $20.0 million U.S. dollars) credit facility (the “Jasper Credit Facility”). The Jasper Credit Facility provides for a $17.0 million Canadian dollar term loan (“Jasper Term Loan”) and a $10.0 million Canadian dollar revolving credit facility (“Jasper Revolving Credit Facility”). The Jasper Credit Facility matures on January 31, 2028. The Jasper Revolving Credit Facility carries financial covenants as follows: • Maintain a pre-compensation fixed-charge coverage ratio of not less than 1.30 to 1.00; and • Maintain a post-compensation fixed-charge coverage ratio of not less than 1.10 to 1.00. As of September 30, 2024, both the pre-compensation and post-compensation fixed-charge coverage ratios were 2.25 to 1.00, and Pursuit was in compliance with all covenants under the Jasper Credit Facility. Jasper Term Loan The proceeds of the Jasper Term Loan reflect the outstanding balance under Pursuit’s prior Forest Park construction loan facility at the time it was converted to the Jasper Term Loan of $16.8 million Canadian dollars. The Jasper Term Loan bears interest at a 6.5% fixed rate. Jasper Revolving Credit Facility The proceeds of the Jasper Revolving Credit Facility are used to fund capital improvements. As of September 30, 2024, capacity remaining under the Jasper Revolving Credit Facility was $10.0 million Canadian dollars (approximately $7.4 million U.S. dollars). The Jasper Revolving Credit Facility bears interest at the Canadian Prime Rate plus 2.25%. 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 EURIBOR plus 5.5%. FlyOver Iceland entered into an addendum effective December 1, 2021 wherein the principal payments were deferred for twelve months beginning December 1, 2021, with equal quarterly principal payments due beginning December 1, 2022 and the maturity date was extended to September 1, 2027. On February 27, 2024, FlyOver Iceland reached an agreement to amend and extend the FlyOver Iceland Credit Facility, wherein the principal payments are deferred for six months beginning March 1, 2024, with equal quarterly principal payments due beginning September 1, 2024 and a maturity date of September 1, 2029. The amended terms also include a modification of the financial covenants and an adjustment of the interest rate to three month EURIBOR plus 5.5%, decreasing to 4.9% once FlyOver Iceland’s leverage ratio is below 4.00 to 1.00. 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 and matured on April 1, 2023. It bore interest on a seven-day term deposit rate at the Central Bank of Iceland. The second term loan for ISK 30.0 million was entered into effective October 15, 2020 and matured and was repaid in full on October 1, 2024. It bore 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, w hich was extended to February 1, 2024 by way of a subsequent amendment, and bore interest at one-month Reykjavik InterBank Offered Rate (“REIBOR”) plus 4.99%. On February 27, 2024, FlyOver Iceland reached an agreement with its lender to refinance the ISK 50.0 million loan with a new ISK 50.0 million term loan, which was repaid on August 1, 2024. 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 7.6%. Changes to our financing arrangements are as follows:
(in thousands) |  |  |
Balance at December 31, 2023 |  | $ | — |
Additions |  |  | 13,062 |
Payments |  |  | (12,253 | )
Foreign currency translation adjustment |  |  | (93 | )
Balance at September 30, 2024 |  | $ | 716 |

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