Film Related Obligations

6 Months Ended

Sep. 30, 2023


	September 30, 2023		March 31, 2023
	(Amounts in millions)
Film related obligations:
Production Loans	$	1,198.9	$	1,349.9
Production Tax Credit Facility	234.3		231.8
Programming Notes	67.9		83.6
Backlog Facility and Other	186.6		226.0
IP Credit Facility	124.8		143.8
Total film related obligations	1,812.5		2,035.1
Unamortized debt issuance costs	(10.7)		(11.5)
Total film related obligations, net	1,801.8		2,023.6

Less current portion	(1,259.5)		(1,007.2)
Total non-current film related obligations	$	542.3	$	1,016.4

Production Loans. Production loans represent individual and multi-title loans for the production of film and television programs that the Company produces. The majority of the Company's production loans have contractual repayment dates either at or near the expected completion or release dates, with the exception of certain loans containing repayment dates on a longer term basis, and incur primarily SOFR-based interest at a weighted average rate of 7.10% (before the impact of interest rate swaps, see Note 17 for interest rate swaps). Production loans amounting to $1,070.8 million are secured by collateral which consists of the underlying rights related to the intellectual property (i.e. film or television show), and $128.1 million are unsecured.

Production Tax Credit Facility. In January 2021, as amended in March 2022, the Company entered into a non-recourse senior secured revolving credit facility (the "Production Tax Credit Facility") based on and secured by collateral consisting solely of certain of the Company’s tax credit receivables. The maximum principal amount of the Production Tax Credit Facility is $235.0 million, subject to the amount of collateral available, which is based on specified percentages of amounts payable to the Company by governmental authorities pursuant to the tax incentive laws of certain eligible jurisdictions that arise from the production or exploitation of motion pictures and television programming in such jurisdiction. Cash collections from the underlying collateral (tax credit receivables) are used to repay the Production Tax Credit Facility. Advances under the Production Tax Credit Facility bear interest at a rate equal to SOFR plus 0.10% to 0.25% depending on the SOFR term (i.e.,

one, three or six months), plus 1.50% per annum or the base rate plus 0.50% per annum (effective interest rate of 6.93% at September 30, 2023). The Production Tax Credit Facility matures on January 27, 2025. As of September 30, 2023, there was $0.7 million available under the Production Tax Credit Facility.

Programming Notes. Programming notes represent individual unsecured loans for the licensing of film and television programs that the Company licenses. The Company's programming notes have contractual repayment dates in October 2023 and November 2023, and incur SOFR-based interest at a weighted average rate of 8.05%.

IP Credit Facility. In July 2021, as amended in September 2022, certain subsidiaries of the Company entered into a senior secured amortizing term credit facility (the "IP Credit Facility") based on and secured by the collateral consisting solely of certain of the Company’s rights in certain library titles. The maximum principal amount of the IP Credit Facility is $161.9 million, subject to the amount of collateral available, which is based on the valuation of cash flows from the libraries. The cash flows generated from the exploitation of the rights will be applied to repay the IP Credit Facility subject to cumulative minimum guaranteed payment amounts as set forth below:

Cumulative Period From
September 29, 2022 Through:

Cumulative Minimum Guaranteed Payment Amounts

Payment Due Date

(in millions)

September 30, 2023

$30.4

November 14, 2023

September 30, 2024

$60.7

November 14, 2024

September 30, 2025

$91.1

November 14, 2025

September 30, 2026

$121.4

November 14, 2026

July 30, 2027

$161.9

July 30, 2027

Advances under the IP Credit Facility bear interest at a rate equal to, at the Company’s option, SOFR plus 0.11% to 0.26% depending on the SOFR term (i.e., one or three months) plus 2.25% per annum (with a SOFR floor of 0.25%) or the base rate plus 1.25% per annum (effective interest rate of 7.81% at September 30, 2023). The IP Credit Facility matures on July 30, 2027.

Backlog Facility and Other:

Backlog Facility. In March 2022, as amended in August 2022, certain subsidiaries of the Company entered into a committed secured revolving credit facility (the "Backlog Facility") based on and secured by collateral consisting solely of certain of the Company's fixed fee or minimum guarantee contracts where cash will be received in the future. The maximum principal amount of the Backlog Facility is $175.0 million, subject to the amount of eligible collateral contributed to the facility. Advances under the Backlog Facility bear interest at a rate equal to Term SOFR plus 0.10% to 0.25% depending on the SOFR term (i.e., one, three or six months), plus an applicable margin amounting to 1.15% per annum. The applicable margin is subject to a potential increase to either 1.25% or 1.50% based on the weighted average credit quality rating of the collateral contributed to the facility (effective interest rate of 6.58% at September 30, 2023). The Backlog Facility revolving period ends on May 16, 2025, at which point cash collections from the underlying collateral is used to repay the facility. The facility maturity date is up to 2 years, 90 days after the revolving period ends, currently August 14, 2027. As of September 30, 2023, there was $175.0 million outstanding under the Backlog Facility, and there were no amounts available under the Backlog Facility (March 31, 2023 - $175.0 million outstanding).

Other. The Company has other loans as described below, which are secured by contracted receivables which are not yet recognized as revenue under certain licensing agreements. Outstanding loan balances under these "other" loans must be repaid with any cash collections from the underlying collateral if and when received by the Company, and may be voluntarily repaid at any time without prepayment penalty fees. As of September 30, 2023, an aggregate of $11.6 million remains outstanding under the loans as discussed in the following paragraphs.

In June 2022, the Company borrowed $118.6 million under a loan agreement (the "June 2022 Distribution Loan"), which was fully repaid in the second and third quarter of fiscal 2023.

In September 2022, the Company borrowed $43.4 million under a loan agreement which was to mature on March 28, 2026 (the "September 2022 Distribution Loan") and bore interest at a rate equal to Term SOFR plus 0.11%, plus an applicable margin amounting to 1.50% per annum. The remaining balance of the September 2022 Distribution Loan was fully repaid during the quarter ended September 30, 2023.

In December 2022, the Company borrowed $16.2 million under a loan agreement which matures on November 1, 2025 (the "December 2022 Distribution Loan"), and bears interest at a rate equal to Term SOFR plus 0.11%, plus an applicable margin amounting to 2.10% per annum (effective interest rate of 7.54% at September 30, 2023). The December 2022 Distribution Loan provides for total borrowings up to an aggregate of $18.7 million. As of September 30, 2023, $11.6 million remains outstanding under the December 2022 Distribution Loan.In June 2023, the Company borrowed an aggregate of $158.1 million under a loan agreement (the "June 2023 Distribution Loan"), of which $110.0 million was to mature on June 30, 2026 and bore interest at a rate equal to Term SOFR plus 1.50% per annum and $48.1 million was to mature on August 6, 2025 and bore interest at a rate equal to Term SOFR plus 1.40% per annum. The June 2023 Distribution Loan was fully repaid during the quarter ended September 30, 2023.