10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549 

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024 or 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to                 

COMMISSION FILE NUMBER 001-35872

 EVERTEC, Inc.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) 

Puerto Rico		66-0783622
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)
Cupey Center Building,	Road 176, Kilometer 1.3,
San Juan,	Puerto Rico	00926
(Address of principal executive offices)		(Zip Code)

(787) 759-9999

(Registrant’s telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	EVTC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act. 

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐  No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

At April 25, 2024, there were 64,409,434 outstanding shares of common stock of EVERTEC, Inc.

TABLE OF CONTENTS

		Page
Part I. FINANCIAL INFORMATION
Item 1.	Financial Statements
	Unaudited Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023	1
	Unaudited Condensed Consolidated Statements of Income and Comprehensive (Loss) Income for the three months ended March 31, 2024 and 2023	3
	Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2024 and 2023	4
	Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	34
Item 4.	Controls and Procedures	35
Part II. OTHER INFORMATION		36
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Mine Safety Disclosures	36
Item 5.	Other Information	36
Item 6.	Exhibits	37
SIGNATURES		38

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Report”) contains “forward-looking statements” within the meaning of, and subject to the protection of, the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact contained in this Report, including, without limitation, statements regarding our position as a leader within our industry; our future results of operations and financial position; our business strategies; objectives of management for future operations, including, among others, statements regarding our expected growth, international expansion and future capital expenditures; the impact of market conditions and other macroeconomic factors on our business, financial condition and results of operations; the timing and anticipated outcome of the accelerated share repurchase agreement; the sufficiency of our cash and cash equivalents; our future capital expenditures and debt service obligations; and the expectations, anticipated benefits of and costs associated with acquisitions, are forward-looking statements.

Words such as “believes,” “expects,” "anticipates," "intends," "projects," “estimates,” and “plans” and similar expressions of future or conditional verbs such as "will," "should," "would," "may," and "could" or the negatives of these terms or variations of them or similar terminology are generally forward-looking in nature and not historical facts. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and may involve significant risks and uncertainties, and that actual results may vary materially from those in the forward-looking statements as a result of various factors. Among the factors that significantly impact our business and could impact our business in the future are:

•our reliance on our relationship with Popular, Inc. (“Popular”) for a significant portion of our revenues pursuant to our second Amended and Restated Master Services Agreement (“A&R MSA”) with them, and as it may impact our ability to grow our business;

•our ability to renew our client contracts on terms favorable to us, including but not limited to the current term and any extension of the MSA with Popular;

•our dependence on our processing systems, technology infrastructure, security systems and fraudulent payment detection systems, as well as on our personnel and certain third parties with whom we do business, and the risks to our business if our systems are hacked or otherwise compromised;

•our ability to develop, install and adopt new software, technology and computing systems;

•a decreased client base due to consolidations and/or failures in the financial services industry;

•the credit risk of our merchant clients, for which we may also be liable;

•the continuing market position of the ATH network;

•a reduction in consumer confidence, whether as a result of a global economic downturn or otherwise, which leads to a decrease in consumer spending;

•our dependence on credit card associations, including any adverse changes in credit card association or network rules or fees;

•changes in the regulatory environment and changes in macroeconomic, market, international, legal, tax, political, or administrative conditions, including inflation or the risk of recession;

•the geographical concentration of our business in Puerto Rico, including our business with the government of Puerto Rico and its instrumentalities, which are facing severe political and fiscal challenges;

•additional adverse changes in the general economic conditions in Puerto Rico, whether as a result of the government’s debt crisis or otherwise, including the continued migration of Puerto Ricans to the U.S. mainland, which could negatively affect our customer base, general consumer spending, our cost of operations and our ability to hire and retain qualified employees;

•operating an international business in Latin America, Puerto Rico and the Caribbean, in jurisdictions with potential political and economic instability;

•the impact of foreign exchange rates on operations;

•our ability to protect our intellectual property rights against infringement and to defend ourselves against claims of infringement brought by third parties;

•our ability to comply with U.S. federal, state, local and foreign regulatory requirements;

•evolving industry standards and adverse changes in global economic, political and other conditions;

•our level of indebtedness and the impact of rising interest rates, restrictions contained in our debt agreements, including the secured credit facilities, as well as debt that could be incurred in the future;

•our ability to protect our IT systems and prevent a cybersecurity attack or breach to our information security;

•the possibility that we could lose our preferential tax rate in Puerto Rico;

•our inability to integrate Sinqia S.A. ("Sinqia") successfully into the Company or to achieve expected accretion to our earnings per common share;

•any loss of personnel or customers in connection with the Sinqia Transaction (as defined below in Note 2 to the Unaudited Condensed Consolidated Financial Statements); and

•any possibility of future catastrophic hurricanes, earthquakes and other potential natural disasters affecting our main markets in Latin America, Puerto Rico and the Caribbean.

These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Forward-looking statements should, therefore, be considered in light of various factors, including those set forth under Part 1, Item 1A. "Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 29, 2024, as updated by Part II, Item 1A.“Risk Factors” in this Report, and in Part I, Item 2.“Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Report, as may be updated in our subsequent filings with the SEC. The Company undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events unless it is required to do so by law.

WHERE YOU CAN FIND MORE INFORMATION

All reports we file with the SEC are available free of charge via the Electronic Data Gathering Analysis and Retrieval (EDGAR) System on the SEC’s website at www.sec.gov. We also provide copies of our SEC filings at no charge upon request and make electronic copies of our reports available for download through our website at www.evertecinc.com as soon as reasonably practicable after filing such material with the SEC.

EVERTEC, Inc. Unaudited Condensed Consolidated Balance Sheets

(In thousands, except share information)

1

	March 31, 2024		December 31, 2023
Assets
Current Assets:
Cash and cash equivalents	$	293,666	$	295,600
Restricted cash	23,597		23,073
Accounts receivable, net	141,332		126,510
Settlement assets	42,068		51,467
Prepaid expenses and other assets	62,336		64,704
Total current assets	562,999		561,354
Debt securities available-for-sale, at fair value	2,093		2,095
Equity securities, at fair value	10,843		9,413
Investment in equity investees	21,859		21,145
Property and equipment, net	60,777		62,453
Operating lease right-of-use asset	14,824		14,796
Goodwill	777,932		791,700
Other intangible assets, net	490,188		518,070
Deferred tax asset	19,879		47,847
Derivative asset	6,962		4,385
Other long-term assets	28,130		27,005
Total assets	$	1,996,486	$	2,060,263
Liabilities and stockholders’ equity
Current Liabilities:
Accrued liabilities	$	116,977	$	129,160
Accounts payable	66,629		66,516
Contract liability	18,938		21,055
Income tax payable	—		3,402
Current portion of long-term debt	23,867		23,867
Short-term borrowings	80,000		—
Current portion of operating lease liability	7,575		6,693
Settlement liabilities	40,446		47,620
Total current liabilities	354,432		298,313
Long-term debt	941,717		946,816
Deferred tax liability	53,576		87,916
Contract liability - long term	52,062		41,825
Operating lease liability - long-term	8,686		9,033
Other long-term liabilities	34,116		40,984
Total liabilities	1,444,589		1,424,887
Commitments and contingencies (Note 14)
Redeemable non-controlling interests	40,658		36,968
Stockholders’ equity
Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued	—		—
Common stock, par value $0.01; 206,000,000 shares authorized; 64,408,959 shares issued and outstanding as of March 31, 2024 (December 31, 2023 - 65,450,799)	644		654
Additional paid-in capital	—		36,527
Accumulated earnings	512,535		538,903
Accumulated other comprehensive (loss) income, net of tax	(5,922)		18,209
Total stockholders’ equity	507,257		594,293
Non-redeemable non-controlling interest	3,982		4,115
Total equity	511,239		598,408
Total liabilities and equity	$	1,996,486	$	2,060,263

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2

EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Income and Comprehensive (Loss) Income

(In thousands, except per share information)

	Three months ended March 31,
	2024		2023
Revenues	$	205,318	$	159,814
Operating costs and expenses
Cost of revenues, exclusive of depreciation and amortization	102,448		76,417
Selling, general and administrative expenses	35,626		23,875
Depreciation and amortization	34,441		19,432
Total operating costs and expenses	172,515		119,724
Income from operations	32,803		40,090
Non-operating income (expenses)
Interest income	3,360		1,133
Interest expense	(19,939)		(5,643)
Loss on foreign currency remeasurement	(4,456)		(4,864)
Earnings from equity method investments	1,071		1,155
Other income, net	3,840		1,010
Total non-operating expenses	(16,124)		(7,209)
Income before income taxes	16,679		32,881
Income tax expense	292		2,818
Net income	16,387		30,063
Less: Net income attributable to non-controlling interest	408		11
Net income attributable to EVERTEC, Inc.’s common stockholders	15,979		30,052
Other comprehensive (loss) income, net of tax of $157 and $(116)
Foreign currency translation adjustments	(26,476)		17,605
Gain (loss) on cash flow hedges	2,348		(1,545)
Unrealized loss on change in fair value of debt securities available-for-sale	(3)		$	(20)
Other comprehensive (loss) income, net of tax	$	(24,131)	$	16,040
Total comprehensive (loss) income attributable to EVERTEC, Inc.’s common stockholders	$	(8,152)	$	46,092
Net income per common share - basic attributable to EVERTEC, Inc.’s common stockholders	$	0.25	$	0.46
Net income per common share - diluted attributable to EVERTEC, Inc.’s common stockholders	$	0.24	$	0.46

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3

EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity

(In thousands, except share information)

	Number of Shares of Common Stock	Common Stock		Additional Paid-in Capital		Accumulated Earnings		Accumulated  Other Comprehensive Income (Loss)		Non-Redeemable Non-Controlling Interest		Total Stockholders’ Equity
Balance at December 31, 2023	65,450,799	$	654	$	36,527	$	538,903	$	18,209	$	4,115	$	598,408
Share-based compensation recognized	—	—		7,349		—		—		—		7,349
Repurchase of common stock	(1,516,793)	(15)		(30,943)		(39,042)		—		—		(70,000)
Restricted stock units delivered	474,953	5		(9,761)		—		—		—		(9,756)
Net income	—	—		—		16,497		—		(110)		16,387
Cash dividends declared on common stock, $0.05 per share	—	—		—		(3,273)		—		—		(3,273)
Adjustment of redeemable noncontrolling interest to redemption value	—	—		(3,172)		—		—		—		(3,172)
Excise tax on repurchase of common stock	—	—		—		(550)		—		—		(550)
Other comprehensive loss	—	—		—		—		(24,131)		(23)		(24,154)
Balance at March 31, 2024	64,408,959	$	644	$	—	$	512,535	$	(5,922)	$	3,982	$	511,239

	Number of Shares of Common Stock	Common Stock		Additional Paid-in Capital		Accumulated Earnings		Accumulated  Other Comprehensive Loss		Non-Controlling Interest		Total Stockholders’ Equity
Balance at December 31, 2022	64,847,233	$	648	$	—	$	487,349	$	(16,486)	$	3,237	$	474,748
Share-based compensation recognized	—	—		5,557		—		—		—		5,557
Repurchase of common stock	(187,976)	(1)		—		(6,268)		—		—		(6,269)
Restricted stock units delivered	419,205	4		(5,557)		(321)		—		—		(5,874)
Net income	—	—		—		30,052		—		11		30,063
Cash dividends declared on common stock, $0.05 per share	—	—		—		(3,249)		—		—		(3,249)
Other comprehensive income	—	—		—		—		16,040		125		16,165
Balance at March 31, 2023	65,078,462	$	651	$	—	$	507,563	$	(446)	$	3,373	$	511,141

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4

EVERTEC, Inc. Unaudited Condensed Consolidated Statements of Cash Flows

(In thousands)

	Three months ended March 31,
	2024		2023
Cash flows from operating activities
Net income	16,387		$	30,063
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	34,441		19,432
Amortization of debt issue costs and accretion of discount	1,874		396
Operating lease amortization	1,810		1,626
Unrealized gain on change in fair value of equity securities	(2,325)		—
Deferred tax benefit	(5,720)		(2,208)
Share-based compensation	7,349		5,557
Earnings of equity method investment	(1,071)		(1,155)
Loss on foreign currency remeasurement	4,456		4,864
Other, net	797		2,530
Decrease (increase) in assets:
Accounts receivable, net	(14,756)		10,044
Prepaid expenses and other assets	130		(5,388)
Other long-term assets	(1,484)		(261)
(Decrease) increase in liabilities:
Accrued liabilities and accounts payable	(11,031)		(13,417)
Income tax payable	(3,347)		(639)
Contract liability	8,721		3,089
Operating lease liabilities	(4)		310
Other long-term liabilities	(252)		(332)
Total adjustments	19,588		24,448
Net cash provided by operating activities	35,975		54,511
Cash flows from investing activities
Additions to software	(16,494)		(9,257)
Property and equipment acquired	(5,389)		(4,063)
Purchase of equity securities	(111)		—
Acquisitions, net of cash acquired	—		(23,317)
Net cash used in investing activities	(21,994)		(36,637)
Cash flows from financing activities
Withholding taxes paid on share-based compensation	(9,756)		(5,874)
Net increase (decrease) in short-term borrowings	80,000		(20,000)
Dividends paid to noncontrolling interest holders	(1,142)		—
Dividends paid	(3,273)		(3,249)
Repurchase of common stock	(70,000)		(6,269)
Repayment of long-term debt	(5,967)		(5,187)
Repayment of other financing agreement	(6,212)		—
Net cash used in financing activities	(16,350)		(40,579)
Effect of foreign exchange rate on cash, cash equivalents and restricted cash	(3,768)		(275)
Net decrease in cash, cash equivalents and restricted cash	(6,137)		(22,980)
Cash, cash equivalents, restricted cash and cash included in settlement assets at beginning of the period	343,724		215,657
Cash, cash equivalents, restricted cash, and cash included in settlement assets at end of the period	$	337,587	$	192,677

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

Notes to Unaudited Condensed Consolidated Financial Statements

Note 1 - The Company and Basis of Presentation	7
Note 2 - Business Acquisition	7
Note 3 – Property and Equipment, net	8
Note 4 - Goodwill and Other Intangible Assets	9
Note 5 - Debt and Short-Term Borrowings	10
Note 6 - Financial Instruments and Fair Value Measurements	11
Note 7 - Redeemable Non-Controlling Interests	13
Note 8 - Equity	13
Note 9 - Share-based Compensation	14
Note 10 - Revenues	18
Note 11 - Current Expected Credit Losses	16
Note 12 - Income Tax	17
Note 13 - Net Income per Common Share	18
Note 14 - Commitments and Contingencies	18
Note 15 - Segment Information	19
Note 16 - Supplemental Statement of Cash Flows Information	22
Note 17 - Subsequent Events	22

6

Note 1 – The Company and Basis of Presentation

The Company

EVERTEC, Inc. and its subsidiaries (collectively the “Company” or “EVERTEC”) is a leading full-service transaction-processing business and financial technology provider in Latin America, Puerto Rico and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment services and business process management services. The Company operates across 26 countries in the region. EVERTEC owns and operates the ATH network, which we believe is one of the leading personal identification number (“PIN”) debit networks in the Caribbean and Latin America. In addition, EVERTEC provides a comprehensive suite of services for core banking, cash processing and fulfillment in Puerto Rico and technology outsourcing in all the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations, and government agencies with solutions that are essential to their operations.

Basis of Presentation

The unaudited condensed consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. The preparation of the accompanying unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited condensed consolidated financial statements. Actual results could differ from these estimates.

Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the Securities and Exchange Commission and, accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2023, included in the Company’s 2023 Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited condensed consolidated financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation. Certain amounts from prior periods have been reclassified to conform to the current period presentation.

Note 2 – Business Acquisition

Acquisition of a Business

On November 1, 2023, the Company completed the acquisition of 100% of the outstanding shares of Sinqia S.A. (“Sinqia”) (the "Sinqia Transaction"), a publicly held company incorporated and existing in accordance with the laws of the Federative Republic of Brazil. The Company completed the acquisition through its wholly-owned subsidiary, Evertec Brasil Informática S.A (“Evertec BR”). In accordance with ASC 805-10-25-15, Evertec is allowed a period, not to exceed 12 months from the acquisition date, to adjust the provisional amounts recognized for a business combination. During the first quarter of 2024, the Company adjusted the operating lease right-of-use asset, goodwill, long-term deferred tax asset, operating lease liability and the deferred tax liability as a result of additional information that became available during the period. The preliminary purchase price allocation is as follows:

7

	Assets/Liabilities (at fair value)
( In thousands)
Cash and cash equivalents	$	37,147
Restricted cash	2,166
Accounts receivable, net	9,989
Prepaid expenses and other assets	5,975
Property and equipment, net	3,618
Operating lease right-of-use asset	1,683
Preliminary goodwill	341,801
Equity securities, at fair value	9,035
Long-term deferred tax asset	28,758
Other intangible assets, net	291,048
Other long-term assets	5,455
Total assets acquired	$	736,675
Accounts payable	13,241
Accrued liabilities	40,775
Operating lease liability	4,114
Current portion of long-term debt	11,400
Long-term debt	57,492
Contract liability	7,356
Deferred tax liability	76,150
Other long-term liabilities	15,134
Total liabilities assumed	$	225,662
Redeemable noncontrolling interests	39,340
Additional paid-in capital	471,673
Total liabilities and equity	$	736,675

The following table details the major groups of intangible assets acquired and the weighted average amortization period for these assets:

	Amount		Weighted-average life
(Dollar amounts in thousands)
Customer relationships	$	155,876	18
Trademark	47,688		10
Software packages	87,484		10
Total	$	291,048	14

Refer to Note 4- Goodwill and Other Intangible Assets for detail of goodwill allocated by reportable segments. The goodwill is primarily attributed to selling the Company's products and services to Sinqia's client base, exporting Sinqia's products to other markets where the Company has presence and the assembled workforce. Currently, a portion of goodwill related to previous Sinqia acquisitions is deductible for income tax purposes on a statutory basis. The Company continues to finalize the purchase price allocation and further changes to the preliminary allocation may be required.

8

Note 3 – Property and Equipment, net

Property and equipment, net consisted of the following:

(Dollar amounts in thousands)	Useful life in years	March 31, 2024		December 31, 2023
Buildings	30	$	2,241	$	2,193
Data processing equipment	3 - 5	190,519		187,761
Furniture and equipment	3 - 20	10,481		10,281
Leasehold improvements	5 -10	4,836		4,876
		208,077		205,111
Less - accumulated depreciation and amortization		(148,817)		(144,117)
Depreciable assets, net		59,260		60,994
Land		1,517		1,459
Property and equipment, net		$	60,777	$	62,453

Depreciation and amortization expense related to property and equipment for the three months ended March 31, 2024 amounted to $5.7 million compared to $5.0 million for the corresponding period in 2023.

Note 4– Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (see Note 15):

(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Balance at December 31, 2023	$	160,972	$	452,597	$	138,121	$	40,010	$	791,700
Adjustment to goodwill from prior year acquisition	—		(1,352)		—		—		(1,352)
Foreign currency translation adjustments	—		(12,416)		—		—		(12,416)
Balance at March 31, 2024	$	160,972	$	438,829	$	138,121	$	40,010	$	777,932

Goodwill is tested for impairment on an annual basis as of August 31, or more often if events or changes in circumstances indicate there may be impairment. The Company may test for goodwill impairment using a qualitative or a quantitative analysis. In a qualitative analysis, the Company assesses whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. No impairment losses were recognized for the periods ended March 31, 2024 or 2023.

The carrying amount of other intangible assets at March 31, 2024 and December 31, 2023 was as follows:

		March 31, 2024
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	563,127	$	(357,752)	$	205,375
Trademarks	10 - 15	92,535		(44,085)		$	48,450
Software packages	3 - 10	518,676		(283,751)		$	234,925
Non-compete agreement	5	1,687		(249)		$	1,438
Other intangible assets, net		$	1,176,025	$	(685,837)	$	490,188

9

		December 31, 2023
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	568,284	$	(340,952)	$	227,332
Trademarks	1 - 15	94,203		(41,319)		52,884
Software packages	3 - 10	510,898		(274,610)		236,288
Non-compete agreement	5	1,735		(169)		1,566
Other intangible assets, net		$	1,175,120	$	(657,050)	$	518,070

Amortization expense related to other intangibles for the three months ended March 31, 2024 amounted to $28.8 million compared to $16.3 million for the corresponding period in 2023.

The estimated amortization expense of the other intangible balances outstanding at March 31, 2024, for the remainder of 2024 and the years thereafter is as follows:

(In thousands)
Remaining 2024	$	78,146
2025	81,086
2026	68,499
2027	57,280
2028	46,758
Thereafter	158,419

Note 5 – Debt and Short-Term Borrowings

Debt at March 31, 2024 and December 31, 2023 was as follows:

(In thousands)	March 31, 2024		December 31, 2023
2027 Term A Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(2))	$	443,736	$	449,450
2030 Term B Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(3))	521,848		521,233
Deferred consideration from Business Combinations	18,860		19,467
Revolving Facility(2)	80,000		—
Note payable due September 1, 2030(1)	7,191		7,403
Total debt	$	1,071,635	$	997,553

(1)Net of unaccreted discount and unamortized debt issue costs, as applicable.

(2)Subject to a minimum rate ("SOFR floor") of 0.00% plus applicable margin of 2.00% at March 31, 2024 and 1.50% at December 31, 2023.

(3)Subject to a SOFR floor of 0.50% plus applicable margin of 3.50% at March 31, 2024 and December 31, 2023.

Secured Credit Facilities

On December 1, 2022, EVERTEC and EVERTEC Group, entered into a credit agreement with a syndicate of lenders and Truist Bank (“Truist”), as administrative agent and collateral agent, providing for (i) a $415.0 million term loan A facility that matures on December 1, 2027, and a $200.0 million revolving credit facility (the “Revolving Facility”, and together with the Term A Loan Facility, the “2022 Credit Facilities”) that matures on December 1, 2027 (the “2022 Credit Facilities Maturity Date”). On October 30, 2023, Evertec, EVERTEC Group and other Loan Parties (as defined in the Existing Credit Agreement) party thereto, entered into a first amendment (the “Amendment”) to the credit agreement, dated as of December 1, 2022 (the “Existing Credit Agreement,” and as amended by the Amendment, the “Amended Credit Agreement”), with a syndicate of lenders and Truist, as administrative agent and collateral agent. Under the Amended Credit Agreement, a syndicate of financial institutions and other lenders provided (i) additional term loan A commitments in the amount of $60.0 million (the “Incremental TLA Facility”) and (ii) a new tranche of term loan B commitments in the amount of $600.0 million (the “New TLB Facility,” and together with the Incremental TLA Facility, the “Facilities”). The $600.0 million term loan B facility matures on October 30, 2030 (the “Term Loan B Maturity Date”). Unless otherwise indicated, the terms and conditions detailed below apply to both

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term loan A facility and term loan B (together "Term Loan Facilities"). In the fourth quarter of 2023, the Company prepaid $60 million of the outstanding balance on Term Loan B.

At March 31, 2024, the unpaid principal balance of the Term A Loan Facility and Term B Loan Facility were $447.5 million and $540.0 million, respectively. At March 31, 2024 the outstanding balance of the Revolving Facility was $80 million and the additional borrowing capacity was $114.0 million, considering letters of credit issued. The Company issues letters of credit against the Revolving Facility which reduce the additional borrowing capacity of the Revolving Facility.

Deferred Consideration for Business Combinations

As part of the Company’s merger and acquisition activities, the Company may enter into agreements by which a portion of the purchase price is financed directly by the seller. At March 31, 2024 and December 31, 2023, the unpaid principal balance of these agreements amounted to $18.9 million and $19.5 million, respectively. Obligations bear interest at rates ranging from 2% to 24% with maturities ranging from April 2024 through March 2027. The current portion of the deferred consideration is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Note Payable

In September 2023, EVERTEC Group entered into a non-interest bearing financing agreement amounting to $10.1 million to purchase software and maintenance which the Company recorded on a discounted basis using an implied interest of 6.9%. As of March 31, 2024, the outstanding principal balance of the note payable on a discounted basis was $7.2 million. The current portion of the note is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Interest Rate Swaps

As of March 31, 2024, the Company has four interest rate swap agreements which convert a portion of the interest rate payments on the Company's Term Loan Facilities from variable to fixed. The interest rate swaps are used to hedge the market risk from changes in interest rates corresponding with the Company's variable rate debt. The interest rate swaps are designated as cash flow hedges and are considered highly effective. Cash flows from the interest rate swaps are included in the accrued liabilities and accounts payable line item in the Company's unaudited condensed consolidated statements of cash flows. Changes in the fair value of the interest rate swaps are recognized in other comprehensive income (loss) until the gains or losses are reclassified to earnings. Gains or losses reclassified to earnings are presented within interest expense in the accompanying condensed consolidated statements of income and comprehensive income.

Swap Agreement	Effective date	Maturity Date	Notional Amount	Variable Rate	Fixed Rate
2018 Swap	April 2020	November 2024	$250 million	1-month SOFR	2.929%
2023 Swap	November 2024	December 2027	$250 million	1-month SOFR	3.375%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.182%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.172%

At March 31, 2024, the carrying amount of the derivatives included on the Company's unaudited condensed consolidated balance sheets was an asset of $7.0 million and a liability of $0.9 million, included in other long-term liabilities. At December 31, 2023, the carrying amount of the derivatives included on the Company's unaudited condensed consolidated balance sheet was an asset of $4.4 million and a liability of $0.9 million, included in other long-term liabilities. The fair value of these derivatives are estimated using Level 2 inputs in the fair value hierarchy on a recurring basis. Refer to Note 8 for disclosure of gains (losses) recorded on cash flow hedging activities.

During the three months ended March 31, 2024 and 2023, the Company reclassified gains of $1.7 million and $1.0 million, respectively, from accumulated other comprehensive loss into interest expense. Based on current SOFR rates, the Company expects to reclassify gains of $10.0 million from accumulated other comprehensive loss into interest expense over the next 12 months.

Note 6 – Financial Instruments and Fair Value Measurements

Recurring Fair Value Measurements

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The following table presents assets and liabilities measured at fair value on a recurring basis at March 31, 2024 and December 31, 2023:

	March 31, 2024								December 31, 2023
(In thousands)	Level 2		Level 3		Measured at NAV		Total		Level 2		Level 3		Total
Financial assets:
Debt securities	$	2,093	$	—	$	—	$	2,093	$	2,095	$	—	$	2,095
Equity securities	—		5,356		5,487		10,843		6,447		2,966		9,413
Interest rate swaps	6,962		—		—		6,962		4,385		—		4,385
Financial liabilities:
Interest rate swaps	900		—		—		900		900		—		900

Debt Securities Available for Sale

Costa Rica Government Obligations are held by a trust in the Costa Rica National Bank as a collateral requirement for settlement activities. The Company may substitute securities as needed but must maintain certain levels of collateral based on transaction volumes. No debt securities were purchased, matured or sold during the quarters ended March 31, 2024 and March 31, 2023. A provision for credit losses was not required for either March 31, 2024 or 2023.

The fair value of debt securities is estimated based on observable inputs through corroboration with market data at the measurement date, therefore classified as a Level 2 asset within the fair value hierarchy.

Derivative Instruments

The fair value of the Company's interest rate swaps are estimated using Level 2 inputs under the fair value hierarchy. Refer to Note 5 for additional information related to the derivative instruments.

Equity Securities

The fair value of the equity securities is calculated based on enterprise value to revenue multiples ranging from 0.4x to 8.3x, therefore classified as a Level 3 asset within the fair value hierarchy. The fair value of the equity securities was $5.4 million at March 31, 2024 and $3.0 million at December 31, 2023. At December 31, 2023, mutual funds classified as equity securities, were registered with the securities and exchange commission in Brazil and were broker traded and therefore classified as Level 2.

The following table presents the changes in equity securities classified as Level 3 assets:

(In thousands)	Equity Securities
Balance at December 31, 2023	$	2,966
Change in fair value of equity securities, recognized through Other income, net	2,353
Foreign currency translation adjustments	37
Balance at March 31, 2024	$	5,356

There were no transfers in or out of Level 3 during the quarter ended March 31, 2024.

Equity Securities Measured at Net Asset Value (NAV)

At March 31, 2024, the Company holds mutual funds classified as equity securities on the Company's unaudited condensed consolidated balance sheet that are measured at fair value using the NAV per share, or its equivalent, as a practical expedient. Mutual funds consist of investments in venture capital strategies and start-ups with a focus on privately held technology companies. The NAV is based on the fair value of the underlying net assets owned by the mutual funds and the relative interest of each participating investor in the fair value of the underlying assets.

Financial assets and liabilities not measured at fair value

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The following table presents the carrying value and estimated fair value for financial instruments at March 31, 2024 and December 31, 2023:

	March 31, 2024		December 31, 2023
(In thousands)	Carrying Amount	Fair Value	Carrying Amount	Fair Value
Financial liabilities:
2027 Term A Loan Facility	443,736	448,623	449,450	452,337
2030 Term B Loan Facility	521,848	541,350	521,240	539,325

The fair value of the term loans at March 31, 2024 and December 31, 2023 was obtained using prices provided by third party service providers. Their pricing is based on various inputs such as market quotes, recent trading activity in a non-active market or imputed prices. These inputs are considered Level 3 inputs under the fair value hierarchy. Also, the pricing may include the use of an algorithm that could take into account movements in the general high yield market, among other variants. The secured term loans are not accounted for at fair value in the balance sheet.

Note 7 – Redeemable Noncontrolling Interests

At March 31, 2024, redeemable noncontrolling interests ("RNCI") consist of interests in consolidated subsidiaries for which the Company has entered into separate option contracts by which the Company has the right to purchase the remaining non-controlling interests through a call option and the non-controlling interest holder has the right to sell the non-controlling interest to the Company through a put option. The following table summarizes the terms of the issued options:

	Percentage of redeemable noncontrolling interest	Earliest exercise date	Formula of redemption value
Homie Do Brasil Informatica	40%	April 1, 2025	Variable multiple of gross sales dependent upon EBITDA margin and gross sales attained times percentage of ownership
Rosk Software S.A.	49%	March 15, 2025	Variable multiple of gross sales dependent upon EBITDA margin attained times percentage of ownership
Compliasset Software e Solucoes Digitais LTDA.	40%	March 15, 2026	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt times percentage of ownership
Lote45 Participacoes S.A.	48%	January 1, 2027	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt minus BRL$10.0 million times percentage of ownership

Given certain provisions within the options, the Company has classified the RNCI as mezzanine equity on the Company's Balance Sheets. RNCI are adjusted quarterly, if necessary, to their estimated redemption value. Adjustments to the redemption value impact stockholders' equity. The following table presents changes in RNCI:

(In thousands)	Redeemable noncontrolling interests
Balance at December 31, 2023	$	36,968
Net income from redeemable non-controlling interests	518
Adjustment of redeemable non-controlling interests to redemption value	3,172
Balance at March 31, 2024	$	40,658

Note 8 – Equity

Accumulated Other Comprehensive Income (Loss)

The following table provides a summary of the changes in the balances of accumulated other comprehensive income (loss) for the quarter ended March 31, 2024: 

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(In thousands)	Foreign Currency Translation Adjustments		Cash Flow Hedges		Unrealized Gains (Losses) on Debt Securities AFS		Total
Balance - December 31, 2023, net of tax	$	14,847	$	3,336	26		18,209
Other comprehensive income (loss) before reclassifications	(26,476)		4,021		(3)		(22,458)
Effective portion reclassified to net income	$	—	(1,673)		—		(1,673)
Balance - March 31, 2024, net of tax	$	(11,629)	$	5,684	$	23	$	(5,922)

Share Repurchase

On March 6, 2024, the Company entered into an accelerated share repurchase agreement (the “ASR”) with Bank of America, N.A. to repurchase an aggregate of $70 million of the Company’s common stock, par value $0.01 per share. In connection with the launch of the ASR, on March 8, 2024, the Company paid Bank of America, N.A., an aggregate of $70 million and received approximately 1.5 million shares of the Company’s common stock. The final number of shares to be received under the ASR agreement will be determined upon completion of the transaction and will be based on the total transaction value and the average of the daily volume-weighted average share price of the Company’s common stock during the term of the transaction. Final settlement of the transaction is expected to be completed in the third quarter of 2024. The Company accounted for this contract as an equity contract. If upon contract termination, an amount is owed by the Company, the contract can be net settled in cash or shares at the Company's option.

Note 9 – Share-based Compensation

Long-term Incentive Plan ("LTIP")

During the three months ended March 31, 2022, 2023 and 2024, the Compensation Committee (the "Compensation Committee") of the Company's Board of Directors ("Board") approved grants of restricted stock units (“RSUs”) to executives and certain employees pursuant to the 2022 LTIP, 2023 LTIP and 2024 LTIP, respectively, all under the terms of the Company's 2022 Equity Incentive Plan. Under the LTIPs, the Company granted RSUs to eligible participants as time-based awards and/or performance-based awards.

The vesting of the RSUs is dependent upon service and/or performance conditions as defined in the award agreements. Employees that received time-based awards with service conditions are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the employee provides services to the Company through the vesting date. Time-based awards generally vest over a period of three years in substantially equal installments commencing on the grant date and ending on February 25 of each year for the 2022 LTIP, February 24 of each year for the 2023 LTIP and February 28 of each year for the 2024 LTIP. In 2022 and 2023, the Company also granted time-based awards with a three year service vesting period which will cliff vest on February 25, 2025 and February 24, 2026, respectively.

For the performance-based awards under the 2022 LTIP, 2023 LTIP, and 2024 LTIP, the Compensation Committee established adjusted earnings before interest, income taxes, depreciation and amortization ("Adjusted EBITDA") as the primary performance measure while maintaining focus on total shareholder return through the use of a market-based total shareholder return ("TSR") performance modifier. The Adjusted EBITDA measure is based on annual Adjusted EBITDA targets and can result in a payout between 0% and 200%, depending on the performance level. The TSR modifier adjusts the shares earned based on the Adjusted EBITDA performance upwards or downwards (+/- 25%) based on the Company’s relative TSR at the end of the three-year performance period as compared to the companies in the Russell 2000 Index. The Adjusted EBITDA performance measure will be calculated for the one-year period commencing on January 1 of the year of the grant and ending on December 31 of the same year, relative to the goals set by the Compensation Committee for this same period. The shares earned will be subject to an additional two-year service vesting period and will vest on February 25, 2025 for the 2022 LTIP, February 24, 2026 for the 2023 LTIP and February 28, 2027 for the 2024 LTIP. Unless otherwise specified in the award agreement, or in an employment agreement, awards are forfeited if the employee voluntarily ceases to be employed by the Company prior to vesting.

The following table summarizes nonvested RSUs activity for the three months ended March 31, 2024:

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Nonvested RSUs	Shares	Weighted-average grant date fair value
Nonvested at December 31, 2023	1,799,012	$	39.42
Granted	1,097,178	36.89
Vested	(738,996)	36.92
Forfeited	(10,220)	38.90
Nonvested at March 31, 2024	2,146,974	$	38.56

For the three months ended March 31, 2024, the Company recognized $7.3 million of share-based compensation expense, compared with $5.6 million for the corresponding period in 2023.

As of March 31, 2024, the maximum unrecognized cost for RSUs was $64.0 million. The cost is expected to be recognized over a weighted average period of 2.5 years.

Note 10 – Revenues

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers into primary geographical markets, nature of the products and services, and timing of transfer of goods and services. The Company's operating segments are determined by the nature of the products and services the Company provides and the primary geographical markets in which the Company operates. Revenue disaggregated by segment is discussed in Note 15, Segment Information.

In the following tables, revenue for each segment, excluding intersegment revenues, is disaggregated by timing of revenue

recognition for the periods indicated.

	Three months ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	32	$	557	$	—	$	2,475	$	3,064
Products and services transferred over time	33,912		69,590		43,099		55,653		$	202,254
	$	33,944	$	70,147	$	43,099	$	58,128	$	205,318

	Three months ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	113	$	614	$	—	$	1,727	$	2,454
Products and services transferred over time	32,366		30,679		40,347		53,968		$	157,360
	$	32,479	$	31,293	$	40,347	$	55,695	$	159,814

Revenue concentration with a single customer, Popular, as a percentage of total revenues for the quarters ended March 31, 2024 and 2023 was approximately 31% and 37%, respectively. Accounts receivable from Popular as of March 31, 2024 and March 31, 2023 amounted to $49.3 million and $41.2 million, respectively.

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Contract Balances

The following table provides information about contract assets from contracts with customers for the three months ended March 31, 2024 and the year ended December 31, 2023.

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	13,917	$	4,749
Services transferred to customers	4,889		28,165
Transfers to accounts receivable	(5,568)		(18,997)
Balance at end of period	$	13,238	$	13,917

The current portion of contract assets is recorded as part of prepaid expenses and other assets, and the long-term portion is included in other long-term assets in the unaudited condensed consolidated balance sheets.

Accounts receivable, net at March 31, 2024 amounted to $141.3 million. Contract liability and contract liability - long term at March 31, 2024 amounted to $18.9 million and $52.1 million, respectively, and may arise when consideration is received or due in advance from customers prior to performance. The contract liability is mainly comprised of upfront fees for implementation or set up activities, including fees charged in pre-production periods in connection with hosting services. During the three months ended March 31, 2024 and 2023, the Company recognized revenue of $7.8 million and $4.4 million, respectively, that was included in the contract liability at December 31, 2023 and 2022, respectively.

Transaction price allocated to the remaining performance obligations

The estimated aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially satisfied at March 31, 2024 was $891.9 million, which is expected to be recognized over the next 1 to 6 years. This amount consists of minimums on certain master services agreements, professional service fees for implementation or set up activities related to managed services and maintenance services typically recognized over the life of the contract, and professional service fees for customizations or development of on-premise licensing agreements, which are recognized over time based on inputs relative to the total expected inputs to satisfy a performance obligation.

Note 11 – Current Expected Credit Losses

Allowance for Current Expected Credit Losses

Trade receivables from contracts with customers are financial assets analyzed by the Company under the expected credit loss model. To measure expected credit losses, trade receivables are grouped based on shared risk characteristics (i.e., the relevant industry sector and customer's geographical location) and days past due (i.e., delinquency status), while considering the following:

•Customers in the same geographical location share similar risk characteristics associated with the macroeconomic environment of their country.

•The Company has two main industry sectors: private and governmental. The private pool is comprised mainly of leading financial institutions, merchants and corporations, while the governmental pool is comprised of government agencies. The governmental customers possess different risk characteristics than private customers because although all invoices are due 30 days after issuance, governmental customers usually pay within 60 to 90 days after issuance (i.e., approximately 30 to 60 more days than private customers).

•The expected credit loss rate is likely to increase as receivables move to older aging buckets. The Company used the following aging categories to estimate the risk of delinquency status: (i) 0 days past due; (ii) 1-30 days past due; (iii) 31-60 days past due; (iv) 61-90 days past due; and (v) over 90 days past due.

The credit losses of the Company’s trade receivables have been low historically and most balances are collected within one year. Therefore, the Company determined that the expected loss rates should be calculated using the historical loss rates adjusted by macroeconomic factors. The historical rates are calculated for each of the aging categories used for pooling trade receivables. To determine the collected portion of each bucket, the collection time of each trade receivable is identified, to estimate the proportion of outstanding balances per aging bucket that ultimately will not be collected. This is used to determine the expectation of losses based on the history of uncollected trade receivables once the specific past due period is surpassed. The historical rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the

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ability of customers to settle the receivables by applying a country risk premium as the forward-looking macroeconomic factor. Specific reserves are established for certain customers for which collection is doubtful.

Rollforward of the Allowance for Expected Current Credit Losses

The following table provides information about the allowance for expected current credit losses on trade receivables for the three months ended March 31, 2024 and the year ended December 31, 2023

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	4,010	$	2,159
Current period provision for expected credit losses	378		2,218
Write-offs	(1,371)		(384)
Recoveries of amounts previously written-off	1		17
Balance at end of period	$	3,018	$	4,010

The Company does not have a delinquency threshold for writing-off trade receivables. The Company has a formal process for the review and approval of write-offs.

Impairment losses on trade receivables are presented as net impairment losses within cost of revenue, exclusive of depreciation and amortization in the unaudited condensed consolidated statements of income and comprehensive income. Subsequent recoveries of amounts previously written-off, when applicable, are credited against the allowance for expected current credit losses within accounts receivable, net on the unaudited condensed consolidated balance sheets.

Note 12 – Income Tax

The components of income tax expense for the three months ended March 31, 2024 and 2023, respectively, consisted of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision	$	6,012	$	5,026
Deferred tax benefit	(5,720)		(2,208)
Income tax (benefit) expense	$	292	$	2,818

The Company conducts operations in Puerto Rico, the United States, and certain countries in Latin America. As a result, the income tax expense includes the effect of taxes paid to the government of Puerto Rico as well as foreign jurisdictions. The following table presents the components of income tax expense for the three months ended March 31, 2024 and 2023, and its segregation based on location of operations:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision
Puerto Rico	$	606	$	1,180
United States	90		11
Foreign countries	5,316		3,835
Total current tax provision	$	6,012	$	5,026
Deferred tax benefit
Puerto Rico	$	(3,659)	$	(235)
United States	(9)		(26)
Foreign countries	(2,052)		(1,947)
Total deferred tax benefit	$	(5,720)	$	(2,208)

Taxes payable to foreign countries by EVERTEC’s subsidiaries is paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements.

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As of March 31, 2024, the Company had $139.8 million of unremitted earnings from foreign subsidiaries, compared to $137.0 million as of December 31, 2023. The Company has not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries because these earnings are intended to be indefinitely reinvested.

As of March 31, 2024, the gross deferred tax asset amounted to $71.1 million and the gross deferred tax liability amounted to $100.1 million, compared to $65.4 million and $100.9 million, respectively, as of December 31, 2023. As of March 31, 2024, and December 31, 2023, there is a valuation allowance against the gross deferred tax asset of approximately $4.7 million and $4.6 million, respectively.

The Company estimates that it is reasonably possible that the liability for uncertain tax position created from acquisitions in foreign jurisdictions will decrease by approximately $2.6 million in the next 12 months as a result of the expiration of the statute of limitations.

Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Computed income tax at statutory rates	$	6,260	$	12,330
Differences in tax rates due to multiple jurisdictions	1,419		1,029
Effect of income subject to tax-exemption grant	(8,252)		(8,849)
Unrecognized tax expense	142		34
Excess tax benefits on share-based compensation	(526)		(91)
Tax credits for research and development activities	—		(884)
Other, net	1,249		(751)
Income tax expense	$	292	$	2,818

Note 13 – Net Income Per Common Share

The reconciliation of the numerator and the denominator of net income per common share is as follows:

	Three Months Ended March 31,
(In thousands, except per share information)	2024		2023
Net income available to EVERTEC, Inc.’s common shareholders	$	15,979	$	30,052
Weighted average common shares outstanding	65,179,965		64,968,298
Weighted average potential dilutive common shares (1)	1,156,714		640,320
Weighted average common shares outstanding - assuming dilution	66,336,679		65,608,618
Net income per common share - basic	$	0.25	$	0.46
Net income per common share - diluted	$	0.24	$	0.46

(1)Potential common shares consist of common stock issuable under RSUs awards using the treasury stock method. Shares excluded from the dilution calculation because they were anti-dilutive amounted to 0.4 million.

On February 15, 2024 the Company's Board declared quarterly cash dividends of $0.05 per share of common stock, which was paid on March 15, 2024, to stockholders' of record on February 27, 2024.

Note 14 – Commitments and Contingencies

EVERTEC is a defendant in a number of legal proceedings arising in the ordinary course of business. Based on the opinion of legal counsel and other factors, management believes that the final disposition of these matters will not have a material adverse effect on the business, results of operations, financial condition, or cash flows of the Company. The Company has identified certain claims in which a loss may be incurred, but in the aggregate the loss would be insignificant. For other claims, where the proceedings are in an initial phase, the Company is unable to estimate the range of possible loss, if any, but at this time, management believes that any loss related to such claims will not be material.

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Note 15 – Segment Information

The Company operates in four business segments: Payment Services - Puerto Rico & Caribbean, Latin America Payments and Solutions, Merchant Acquiring, and Business Solutions.

The Payment Services - Puerto Rico & Caribbean segment revenues are comprised of revenues related to providing access to the ATH debit network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and point of sale ("POS") transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), ATH Movil (person-to-person) and ATH Business (person-to-merchant) digital transactions and EBT (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file.

The Latin America Payments and Solutions segment revenues consist of revenues related to providing access to the ATH network of ATMs and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), as well as licensed software solutions for risk and fraud management and card payment processing. For network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from transaction switching, processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed, and other processing services. Solutions revenues consist of (a) licensing, support and maintenance (“subscription”), implementation and customization of software used to provide financial products in areas such as core banking, credit, investments, payments, foreign exchange, mutual funds, pension funds and consortium, in addition to software used to execute processes such as digital onboarding, digital signature and digital collection; and (b) outsourcing of mission critical IT services. Revenues are based on monthly fixed fees and, in several cases, variable fees based on usage.

The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charges merchants for other services that are unrelated to the number of transactions or the transaction value.

The Business Solutions segment consists of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fixed fee and from fees based on the number of accounts on file (i.e., savings or checking accounts, loans, etc.), server capacity usage or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC is a reseller of hardware and software products and these resale transactions are generally non-recurring.

In addition to the four operating segments described above, management identified certain functional cost areas that operate independently and do not constitute businesses in themselves. These areas could neither be concluded as operating segments nor could they be combined with any other operating segments. Therefore, these areas are aggregated and presented within the “Corporate and Other” category in the financial statements alongside the operating segments. The Corporate and Other category consists of corporate overhead expenses, intersegment eliminations, certain leveraged activities and other non-operating and miscellaneous expenses that are not included in the operating segments. The overhead and leveraged costs relate to activities such as:

•marketing,

•corporate finance and accounting,

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•human resources,

•legal,

•risk management functions,

•internal audit,

•corporate debt related costs,

•non-operating depreciation and amortization expenses generated as a result of merger and acquisition activity,

•intersegment revenues and expenses, and

•other non-recurring fees and expenses that are not considered when management evaluates financial performance at a segment level

The Chief Operating Decision Maker ("CODM") reviews the operating segments separate financial information to assess performance and to allocate resources. Management evaluates the operating results of each of its operating segments based upon revenues and Adjusted EBITDA. Adjusted EBITDA is defined as EBITDA further adjusted to exclude certain non-cash unrealized items and unusual expenses such as: share-based compensation, restructuring related expenses, fees and expenses from corporate transactions such as M&A activity and financing, equity investment income net of dividends received, and the impact from unrealized gains and losses on foreign currency remeasurement for assets and liabilities in non-functional currency. Adjusted EBITDA, as it relates to operating segments, is presented in conformity with ASC Topic 280, Segment Reporting, given that it is reported to the CODM for purposes of allocating resources. The Company has recast prior periods to conform with the modified definition of Adjusted EBITDA. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by revenues and Adjusted EBITDA. As such, segment assets are not disclosed in the notes to the unaudited condensed consolidated financial statements.

The following tables set forth information about the Company’s operations by its four business segments for the periods indicated:

	Three Months Ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	53,031	$	74,216	$	43,099	$	58,128	$	(23,156)	$	205,318
Operating costs and expenses	30,952		76,031		28,819		40,451		(3,738)		172,515
Depreciation and amortization	7,262		16,257		1,233		4,438		5,251		34,441
Non-operating income (expenses)	148		(1,165)		—		139		1,333		455
EBITDA	29,489		13,277		15,513		22,254		(12,834)		67,699
Compensation and benefits (2)	698		1,498		707		785		4,302		7,990
Transaction, refinancing and other (3)	267		(3,029)		—		—		794		(1,968)
(Gain) loss on foreign currency remeasurement (4)	(102)		4,551		—		—		7		4,456
Adjusted EBITDA	$	30,352	$	16,297	$	16,220	$	23,039	$	(7,731)	$	78,177

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $14.6 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.1 million from Latin America Payments and Solutions to both Payment Services- Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $4.5 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of unrealized gains from equity securities and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

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	Three Months Ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	48,429	$	35,317	$	40,347	$	55,695	$	(19,974)	$	159,814
Operating costs and expenses	27,722		29,312		26,689		38,913		(2,912)		119,724
Depreciation and amortization	5,888		2,711		1,129		4,488		5,216		19,432
Non-operating income (expenses)	365		(3,785)		307		532		(118)		(2,699)
EBITDA	26,960		4,931		15,094		21,802		(11,964)		56,823
Compensation and benefits (2)	528		652		532		565		3,568		5,845
Transaction, refinancing and other(3)	292		—		—		—		(689)		(397)
Loss (gain) on foreign currency remeasurement (4)	95		4,772		—		—		(3)		4,864
Adjusted EBITDA	$	27,875	$	10,355	$	15,626	$	22,367	$	(9,088)	$	67,135

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $13.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.0 million from Latin America Payments and Solutions to both Payment Services - Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $2.9 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

The reconciliation of consolidated net income to EBITDA is as follows:

	Three months ended March 31,
(In thousands)	2024		2023
Net Income	$	16,387	$	30,063
Add:
Income tax expense	292		2,818
Interest expense, net	16,579		4,510
Depreciation and amortization	34,441		19,432
Total EBITDA	$	67,699	$	56,823

Note 16 – Supplemental Statement of Cash Flows Information

Supplemental statement of cash flows information is as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Supplemental disclosure of cash flow information:
Cash paid for interest	18,924	5,874
Cash paid for income taxes	4,250	6,119
Supplemental disclosure of non-cash activities:
Payable due to vendor related to equipment and software acquired	5,550	5,282
Accounts payable related to business acquisition	—	881
Right-of-use assets obtained in exchange for operating lease liabilities	2,693	—

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Reconciliation of cash, cash equivalents, restricted cash and cash included in settlement assets as presented on the cash flow statement was as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Cash and cash equivalents	293,666	114,201
Restricted cash	23,597	$	19,015
Cash and cash equivalents included in settlement assets	20,324	59,461
Cash, cash equivalents, restricted cash and cash included in settlement assets	337,587	192,677

Note 17 – Subsequent Events

On April 18, 2024, the Board declared a regular quarterly cash dividend of $0.05 per share on the Company’s outstanding shares of common stock. The dividend is expected to be paid on June 7, 2024 to stockholders of record as of the close of business on April 29, 2024. The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to the Board’s approval and may be adjusted as business needs or market conditions change.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) covers: (i) the results of operations for the three months ended March 31, 2024 and 2023 and (ii) the financial condition as of March 31, 2024. You should read the following discussion and analysis in conjunction with the audited consolidated financial statements (the “Audited Consolidated Financial Statements”) and related notes for the year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K as filed with the SEC on February 29, 2024 and with the unaudited condensed consolidated financial statements (the “Unaudited Condensed Consolidated Financial Statements”) and related notes appearing elsewhere herein. This MD&A contains forward-looking statements that involve risks and uncertainties. Our actual results may differ from those indicated in the forward-looking statements. See “Forward-Looking Statements” for a discussion of the risks, uncertainties and assumptions associated with these statements.

Except as otherwise indicated or unless the context otherwise requires, (a) the terms “EVERTEC,” “we,” “us,” “our,” “our Company” and “the Company” refer to EVERTEC, Inc. and its subsidiaries on a consolidated basis and, (b) the term “EVERTEC Group” refers to EVERTEC Group, LLC and its predecessor entities and their subsidiaries on a consolidated basis. EVERTEC Inc.’s subsidiaries include Holdings, EVERTEC Group; EVERTEC Dominicana, SAS; Evertec Chile Holdings SpA; Evertec Chile SpA; Evertec Chile Global SpA; Evertec Chile Servicios Profesionales SpA; Tecnopago España SL; Paytrue S.A.; Caleidon; S.A.; Evertec Brasil Solutions Informática S.A.; EVERTEC Panamá, S.A.; EVERTEC Costa Rica, S.A. (“EVERTEC CR”); EVERTEC Guatemala, S.A.; Evertec Colombia, SA;, EVERTEC USA, LLC; OPG Technology Corp.; Evertec Placetopay, SAS ("PlacetoPay"); BBR Chile, SpA and BBR Perú, S.A.C.,(collectively "BBR"); Paysmart Pagamentos Eletronicos Ltda, Issuer Holding Ltda. and Issuer Instituição de Pagamentos Ltda( collectively "paySmart"); EVERTEC México Servicios de Procesamiento, S.A. de C.V.; Sinqia S.A.,Torq. Inovação Digital Ltda, Sinqia Tecnologia Ltda., Homie do Brasil Informática S.A., Rosk Software S.A., Lote 45 Participações S.A., and Compliasset S.A. (collectively "Sinqia"). Neither EVERTEC nor EVERTEC Intermediate Holdings, LLC conducts any operations other than with respect to its indirect or direct ownership of EVERTEC Group.

Executive Summary

EVERTEC is a leading full-service transaction-processing business and financial technology provider in Latin America, Puerto Rico, and the Caribbean, providing a broad range of merchant acquiring, payment services and business solutions. According to the September 2022 Nilson Report, we are one of the largest merchant acquirers in Latin America based on total number of transactions and we believe we are the largest merchant acquirer in the Caribbean. We operate across 26 countries out of 20 offices, including our headquarters in Puerto Rico. We own and operate the ATH network, which we believe is one of the leading personal identification number (“PIN”) debit networks in Latin America. We process over six billion transactions annually through a system of electronic payment networks in Puerto Rico and Latin America and a comprehensive suite of services for core banking, cash processing, and fulfillment in Puerto Rico. Additionally, we offer technology outsourcing and payment transactions fraud monitoring to all the regions we serve. We serve a diversified customer base of leading financial institutions, merchants, corporations, and government agencies with “mission-critical” technology solutions that enable them to issue, process and accept transactions securely. We believe our business is well-positioned to continue to expand across the fast-growing Latin America region.

We are differentiated, in part, by our diversified business model, which enables us to provide our varied customer base with a broad range of transaction-processing services from a single source across numerous channels and geographic markets. We believe this capability provides several competitive advantages that will enable us to continue to penetrate our existing customer base with complementary new services, win new customers, develop new sales channels, and enter new markets. We believe these competitive advantages include:

•Our ability to provide competitive products;

•Our ability to provide in one package a range of services that traditionally had to be sourced from different vendors;

•Our ability to serve customers with disparate operations in several geographies with technology solutions that enable them to manage their business as one enterprise; and

•Our ability to capture and analyze data across the transaction-processing value chain and use that data to provide value-added services that are differentiated from those offered by pure-play vendors that serve only one portion of the transaction-processing value chain (such as only merchant acquiring or payment services).

Our broad suite of services spans the entire transaction-processing value chain and includes a range of front-end customer-facing solutions such as the electronic capture and authorization of transactions at the point-of-sale for both card present transactions and card not present transactions, as well as back-end support services such as the clearing and settlement of transactions and account reconciliation for card issuers. These include: (i) merchant acquiring services, which enable POS and

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e-commerce merchants to accept and process electronic methods of payment such as debit, credit, prepaid and EBT cards; (ii) payment processing services, which enable financial institutions and other issuers to manage, support and facilitate the processing for credit, debit, prepaid, automated teller machines (“ATM”) and EBT card programs; and (iii) business process management solutions, which provide “mission-critical” technology solutions such as core bank processing, as well as IT outsourcing and cash management services to financial institutions, corporations and governments. We provide these services through scalable, end-to-end technology platforms that we manage and operate in-house and that generate significant operating efficiencies that enable us to maximize profitability.

We sell and distribute our services primarily through a proprietary direct sales force with established customer relationships. We continue to pursue joint ventures and merchant acquiring alliances. We benefit from an attractive business model, the hallmarks of which are recurring revenue, scalability, significant operating margins and moderate capital expenditure requirements. Our revenue is predominantly recurring in nature because of the mission-critical and embedded nature of the services we provide. In addition, we generally enter into multi-year contracts with our customers. We believe our business model should enable us to continue to grow our business organically in the primary markets we serve without significant incremental capital expenditures.

2024 Developments

On March 4, 2024 the Board of Directors (the “Board”) of Evertec approved an increase to Evertec’s existing share repurchase authorization to permit future repurchases of up to an aggregate of $220 million worth of shares of the Company’s common stock, par value $0.01 per share by December 31, 2025. Prior to this increase, the Company’s share repurchase program authorization had approximately $137 million remaining. Under the repurchase program, the Company may repurchase shares in the open market, through accelerated share repurchase programs, Rule 10b5-1 plans, or in privately negotiated transactions.

On March 6, 2024, the Company entered into an accelerated share repurchase agreement (the “ASR”) with Bank of America, N.A. to repurchase an aggregate of $70 million of the Company’s common stock, par value $0.01 per share. In connection with the launch of the ASR, on March 8, 2024, the Company paid Bank of America, N.A., an aggregate of $70 million and received approximately 1.5 million shares of the Company’s common stock. The final number of shares to be received under the ASR agreement will be determined upon completion of the transaction and will be based on the total transaction value and the average of the daily volume-weighted average share price of the Company’s common stock during the term of the transaction. Final settlement of the transaction is expected to be completed in the third quarter of 2024.

Factors and Trends Affecting the Results of Our Operations

The ongoing migration from cash and paper methods of payment to electronic payments continues to benefit the transaction- processing industry globally. We believe that the penetration of electronic payments in the markets in which we operate is significantly lower relative to the U.S. market, which, together with the ongoing shift from cash and paper methods of payment to electronic payments will continue to generate growth opportunities for our business. For example, currently the adoption of banking products, including electronic payments, in the Latin America and Caribbean region is lower relative to the mature U.S. and European markets. We believe that the unbanked and underbanked population in our markets will continue to shrink, and therefore drive incremental penetration and growth of electronic payments in Puerto Rico and other Latin America regions. We also benefit from the outsourcing of technology systems and processes trend for financial institutions and government. Many medium- and small-size institutions in the Latin America markets in which we operate have outdated systems and updating these IT legacy systems is financially and logistically challenging, which presents a business opportunity for us.

In recent years, consumer preference has accelerated its shift away from cash and paper payment methods, noting increased demand for omni-channel payment services that facilitate cashless and contactless transactions. The markets in which we operate, particularly Latin America and the Caribbean, continue to grow and consumer preference is driving an increase for electronic payments usage. Latin America is one of the fastest-growing mobile markets globally, with a growing base of tech-savvy customers that demonstrate a preference for credit cards, digital wallets, contactless payments, and other value-added offerings. The region's fintech sector is driving change via new contactless payment technology, which is becoming a popular alternative to cash payments. We continue to believe that the attractive characteristics of our markets and our position across multiple services and sectors will continue to drive growth and profitability in our businesses.

Our payment businesses also generally experience moderate increased activity during the traditional holiday shopping periods and around other nationally recognized holidays, which follow consumer spending patterns.

Finally, our financial condition and results of operations are, in part, dependent on the economic and general conditions of the geographies in which we operate. Rising interest rates, inflationary pressures, foreign currency fluctuations and economic

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uncertainty in the markets in which we operate may affect consumer confidence, which could result in a decrease in consumer spending and an impact to our financial results.

Relationship with Popular

On September 30, 2010, EVERTEC Group entered into a 15-year MSA, and several related agreements with Popular. On July 1, 2022, we modified and extended the main commercial agreements with Popular, including a 10-year extension of the Merchant Acquiring Independent Sales Organization Agreement (as amended, the "A&R ISO Agreement"), a 5-year extension of the ATH Network Participation Agreement and a 3-year extension of the MSA (the "A&R ISO Agreement"). The A&R ISO Agreement, which defines our merchant acquiring relationship with Popular, now includes revenue sharing provisions with Popular. The MSA modifications also include the elimination of the exclusivity requirement, the inclusion of annual MSA minimums through September 30, 2028, a 10% discount on certain MSA services beginning in October of 2025 and adjustments to the CPI pricing escalator clause. On the same date, we also sold to Popular certain assets in exchange for 4.6 million shares of EVERTEC common stock owned by Popular (collectively with the contract amendments, the "Popular Transaction"). On August 15, 2022, through a secondary offering, Popular sold its remaining shares of EVERTEC common stock. EVERTEC is no longer deemed a subsidiary of Popular under the Bank Holding Company Act. Popular continues to be the Company's largest customer and for the three months ended March 31, 2024 approximately 31% of our revenues were generated from this relationship.

Results of Operations

Comparison of the three months ended March 31, 2024 and 2023

	Three months ended March 31,
In thousands	2024		2023		Variance
Revenues	$	205,318	$	159,814	$	45,504	28	%
Operating costs and expenses
Cost of revenues, exclusive of depreciation and amortization	102,448		76,417		26,031		34	%
Selling, general and administrative expenses	35,626		23,875		11,751		49	%
Depreciation and amortization	34,441		19,432		15,009		77	%
Total operating costs and expenses	172,515		119,724		52,791		44	%
Income from operations	$	32,803	$	40,090	$	(7,287)	(18)	%

Revenues

Total revenue for the quarter ended March 31, 2024 was $205.3 million, an increase of 28% as compared with $159.8 million in the prior year period, reflecting the contribution from the Sinqia acquisition and organic growth across all of the Company's segments. Merchant acquiring revenue growth was a result of an increase in sales volume along with an improvement in overall spread. Payment processing revenues in Puerto Rico continue to reflect an increase in POS transaction volumes as well as continued growth in ATH Movil revenues, primarily ATH Business. Latin America revenues benefited from a full quarter contribution from the Sinqia acquisition as well as continued organic growth across the region. Business solutions revenue in Puerto Rico increased mainly due to growth across several lines of business.

Cost of Revenues

Cost of revenues, exclusive of depreciation and amortization, for the three months ended March 31, 2024 amounted to $102.4 million, an increase of $26.0 million or 34% when compared to the same period in the prior year. The increase during the three month period was primarily related to the addition of Sinqia, as well as an increase in cloud services, professional fees, personnel costs and an increase in costs of sales in connection with the increase in revenues from Business Solutions.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended March 31, 2024 amounted to $35.6 million, an increase of $11.8 million or 49% when compared to the same period in the prior year. This increase was mainly driven by the addition of Sinqia along with an increase in personnel costs.

Depreciation and Amortization

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Depreciation and amortization expense for the three months ended March 31, 2024 amounted to $34.4 million, an increase of $15.0 million or 77% when compared to the same period in the prior year. This increase was primarily driven by an increase in amortization of intangible assets created in connection with the Sinqia and paySmart acquisitions, as well as an increase in software amortization for internally developed software.

Non-Operating Expenses

	Three months ended March 31,
In thousands	2024		2023		Variance
Interest income	$	3,360	$	1,133	$	2,227	197	%
Interest expense	(19,939)		(5,643)		(14,296)		253	%
Loss on foreign currency remeasurement	(4,456)		(4,864)		408		(8)	%
Earnings from equity method investments	1,071		1,155		(84)		(7)	%
Other income	3,840		1,010		2,830		280	%
Total non-operating expenses	$	(16,124)	$	(7,209)	$	(8,915)	124	%

Non-operating expenses for the three months ended March 31, 2024 increased by $8.9 million to $16.1 million when compared to the same period in the prior year. The increase was mainly related to an increase of $14.3 million in interest expense resulting from the incremental debt raised to finance the Sinqia acquisition, partially offset by an increase in other income of $2.8 million mainly related to unrealized gains on change in fair value of equity securities and an increase in interest income of $2.2 million.

Income Tax Expense

	Three months ended March 31,
In thousands	2024		2023		Variance
Income tax expense	$	292	$	2,818	$	(2,526)	(90)	%

Income tax expense for the three months ended March 31, 2024 amounted to $0.3 million, a decrease of $2.5 million when compared to the income tax expense in the same period in the prior year. The effective tax rate for the period was 1.8%, compared with 8.6% in the comparable 2023 period. The decrease in the effective tax rate was primarily driven by the higher interest expense resulting from the incremental debt raised as part of the Sinqia acquisition.

Segment Results of Operations

The Company operates in four business segments: Payment Services - Puerto Rico & Caribbean, Latin America Payments and Solutions, Merchant Acquiring, and Business Solutions.

The Payment Services - Puerto Rico & Caribbean segment revenues are comprised of revenues related to providing access to the ATH debit network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), ATH Movil (person-to-person) and ATH Business (person-to-merchant) digital transactions and EBT (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file.

The Latin America Payments and Solutions segment payment revenues consist of revenues related to providing access to the ATH network of ATMs and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment

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revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), as well as licensed software solutions for risk and fraud management and card payment processing. For network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from transaction switching, processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed, and other processing services. Solution revenues consist of (a) licensing, support and maintenance (“subscription”), implementation and customization of software used to provide financial products in areas such as core banking, credit, investments, payments, foreign exchange, mutual funds, pension funds and consortium, in addition to software used to execute processes such as digital onboarding, digital signature and digital collection; and (b) outsourcing of mission critical IT services. Revenues are based on monthly fixed fees and, in several cases, variable fees based on usage.

The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charges merchants for other services that are unrelated to the number of transactions or the transaction value.

The Business Solutions segment consists of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fixed fee and from fees based on the number of accounts on file (i.e., savings or checking accounts, loans, etc.), server capacity usage or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC is a reseller of hardware and software products and these resale transactions are generally non-recurring.

In addition to the four operating segments described above, management identified certain functional cost areas that operate independently and do not constitute businesses in themselves. These areas could neither be concluded as operating segments nor could they be combined with any other operating segments. Therefore, these areas are aggregated and presented within the “Corporate and Other” category in the financial statements alongside the operating segments. The Corporate and Other category consists of corporate overhead expenses, intersegment eliminations, certain leveraged activities and other non-operating and miscellaneous expenses that are not included in the operating segments. The overhead and leveraged costs relate to activities such as:

•marketing,

•corporate finance and accounting,

•human resources,

•legal,

•risk management functions,

•internal audit,

•corporate debt related costs,

•non-operating depreciation and amortization expenses generated as a result of merger and acquisition activity,

•intersegment revenues and expenses, and

•other non-recurring fees and expenses that are not considered when management evaluates financial performance at a segment level

The Chief Operating Decision Maker ("CODM") reviews the operating segments separate financial information to assess performance and to allocate resources. Management evaluates the operating results of each of its operating segments based upon revenues and Adjusted EBITDA. Adjusted EBITDA is defined as EBITDA further adjusted to exclude certain non-cash unrealized items and unusual expenses such as: share-based compensation, restructuring related expenses, fees and expenses from corporate transactions such as M&A activity and financing, equity investment income net of dividends received, and the impact from non-cash unrealized gains and losses on foreign currency remeasurement for assets and liabilities in non-functional currency. Adjusted EBITDA, as it relates to operating segments, is presented in conformity with ASC Topic 280, Segment Reporting, given that it is reported to the CODM for purposes of allocating resources. The Company has recast prior periods to conform with the modified definition of Adjusted EBITDA. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by revenues and Adjusted EBITDA. As such, segment assets are not disclosed in the notes to the unaudited condensed consolidated financial statements.

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The following tables set forth information about the Company’s operations by its four business segments for the periods indicated below.

Comparison of the three months ended March 31, 2024 and 2023

Payment Services - Puerto Rico & Caribbean

	Three months ended March 31,
In thousands	2024		2023
Revenues	$53,031		$48,429
Adjusted EBITDA	30,352		27,875
Adjusted EBITDA Margin	57.2	%	57.6	%

Payment Services - Puerto Rico & Caribbean segment revenues for the three months ended March 31, 2024 increased by $4.6 million to $53.0 million when compared to the same period in the prior year. The increase in revenues was primarily driven by an increase in POS transactions and continued strong digital payments growth from ATH Movil, primarily ATH Business, as well as increases in transaction-processing and monitoring services provided to the Latin America Payments and Solutions segment. Adjusted EBITDA increased by $2.5 million to $30.4 million. This increase was primarily driven by an increase in revenue, which was partially offset by higher professional services and personnel costs.

Latin America Payments and Solutions

	Three months ended March 31,
In thousands	2024		2023
Revenues	$74,216		$35,317
Adjusted EBITDA	16,297		10,355
Adjusted EBITDA Margin	22.0	%	29.3	%

Latin America Payments and Solutions segment revenues for the three months ended March 31, 2024 increased by $38.9 million to $74.2 million when compared to the same period in the prior year. Revenues benefited from a full quarter contribution from the Sinqia acquisition as well as continued organic growth across the region, contribution generated from the paySmart acquisition completed in March of 2023 and higher minimums from the processing contract with GetNet Chile. Adjusted EBITDA increased by $5.9 million when compared to the same period in the prior year driven by the impact from the Sinqia acquisition, which contributes at a lower margin.

Merchant Acquiring

	Three months ended March 31,
In thousands	2024		2023
Revenues	$43,099		$40,347
Adjusted EBITDA	16,220		15,626
Adjusted EBITDA Margin	37.6	%	38.7	%

Merchant Acquiring segment revenues for the three months ended March 31, 2024 increased by $2.8 million to $43.1 million when compared to the same period in the prior year. The revenue increase was primarily driven by an increase in sales volume and an increase in the overall spread. Adjusted EBITDA increased by $0.6 million to $16.2 million driven by the increase in revenues partially offset by higher processing costs driven by the effect of a declining average ticket and an increase in the revenue sharing agreements.

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Business Solutions

	Three months ended March 31,
In thousands	2024		2023
Revenues	$58,128		$55,695
Adjusted EBITDA	23,039		22,367
Adjusted EBITDA Margin	39.6	%	40.2	%

Business Solutions segment revenues for the three months ended March 31, 2024 increased by $2.4 million to $58.1 million as compared to the prior year period. This increase was primarily driven by an increase in several lines of business. Adjusted EBITDA increased by $0.7 million to $23.0 million as compared to the prior year period. This increase was primarily driven by the higher revenues partially offset by higher cost of sale and equipment expenses.

Liquidity and Capital Resources

As of March 31, 2024, there were no material changes to our primary short-term and long-term requirements for liquidity and capital resources as disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” of our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 29, 2024. Our principal source of liquidity is cash generated from operations, and our primary liquidity requirements are the funding of working capital needs, capital expenditures, acquisitions, dividend payments, share repurchases and debt service. We also have a $200.0 million Revolving Facility, of which $114.0 million was available for borrowing as of March 31, 2024. The Company issues letters of credit against our Revolving Facility which reduce our availability of funds to be drawn.

As of March 31, 2024, we had cash and cash equivalents of $293.7 million, of which $201.2 million resides in our subsidiaries located outside of Puerto Rico for purposes of (i) funding the respective subsidiary’s current business operations and (ii) funding potential future investment outside of Puerto Rico. We intend to reinvest these funds outside of Puerto Rico, and based on our liquidity forecast, we will not need to repatriate this cash to fund the Puerto Rico operations or to meet debt-service obligations. However, if in the future we determine that we no longer need to maintain cash balances within our foreign subsidiaries, we may elect to distribute such cash to the Company in Puerto Rico. Distributions from the foreign subsidiaries to Puerto Rico may be subject to tax withholding and other tax consequences. Additionally, our credit agreement imposes certain restrictions on the distribution of dividends from subsidiaries.

Our primary use of cash is for operating expenses, working capital requirements, capital expenditures, acquisitions, dividend payments, share repurchases, debt service, and other transactions as opportunities present themselves.

Based on our current level of operations, we believe our existing cash flows from operations and the available secured Revolving Facility will be adequate to meet our liquidity needs for at least the next twelve months from the date of this Report. However, our ability to fund future operating expenses, dividend payments, capital expenditures, mergers and acquisitions, and our ability to make scheduled payments of interest, to pay principal on or refinance our indebtedness and to satisfy any other of our present or future debt obligations will depend on our future operating performance, which may be affected by general economic, financial and other factors beyond our control.

	Three months ended March 31,
(In thousands)	2024		2023
Cash provided by operating activities	$	35,975	$	54,511
Cash used in investing activities	(21,994)		(36,637)
Cash used in financing activities	(16,350)		(40,579)
Effect of foreign exchange rate on cash, cash equivalents and restricted cash	(3,768)		(275)
Net decrease in cash, cash equivalents and restricted cash	$	(6,137)	$	(22,980)

Net cash provided by operating activities for the three months ended March 31, 2024 was $36.0 million compared to $54.5 million for the same period in the prior year, a decrease of $18.5 million, which was primarily driven by a decrease in net income as well as a decrease in collections for accounts receivable.

Net cash used in investing activities for the three months ended March 31, 2024 was $22.0 million compared to $36.6 million for the same period in the prior year, the decrease is primarily related to the Acquisition of Paysmart completed in the first quarter of the prior year for $23.3 million. Partially offsetting this decrease was an increase in additions to software and purchases of property, plant and equipment of $8.6 million.

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Net cash used in financing activities for the three months ended March 31, 2024 was $16.4 million compared to $40.6 million for the same period in the prior year. The decrease in cash used in financing activities was primarily driven by a $80.0 million draw on the Revolving Facility compared with a repayment of $20.0 million in the prior year period. Partially offsetting this decrease was an increase in share repurchases of $63.7 million, cash used to paydown other financing arrangements of $6.2 million and dividends paid to non-controlling interest shareholders of $1.1 million.

Capital Resources

Our principal capital expenditures are for hardware and computer software (purchased and internally developed) and additions to our property and equipment. During the three months ended March 31, 2024 and 2023, we invested approximately $21.9 million and $13.3 million in our capital resources, respectively. Generally, we fund capital expenditures with cash generated from operations and, if necessary, borrowings under our Revolving Facility.

Dividend Payments

On February 15, 2024 the Board declared quarterly cash dividends of $0.05 per share of common stock, which were paid on March 15, 2024, to stockholders of record as of the close of business on February 27, 2024. On April 18, 2024, our Board declared a regular quarterly cash dividend of $0.05 per share on the Company’s outstanding shares of common stock. The dividend is expected to be paid on June 7, 2024 to stockholders of record as of the close of business on April 29, 2024. The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to the Board’s approval and may be adjusted as business needs or market conditions change.

Financial Obligations

Secured Credit Facilities

On December 1, 2022, EVERTEC and EVERTEC Group, entered into a credit agreement with a syndicate of lenders and Truist Bank (“Truist”), as administrative agent and collateral agent, providing for (i) a $415.0 million term loan A facility that matures on December 1, 2027, and a $200.0 million revolving credit facility (the “Revolving Facility”, and together with the Term A Loan Facility, the “2022 Credit Facilities”) that matures on December 1, 2027 (the “2022 Credit Facilities Maturity Date”). On October 30, 2023, Evertec, EVERTEC Group and other Loan Parties (as defined in the Existing Credit Agreement) party thereto, entered into a first amendment (the “Amendment”) to the credit agreement, dated as of December 1, 2022 (the “Existing Credit Agreement,” and as amended by the Amendment, the “Amended Credit Agreement”), with a syndicate of lenders and Truist, as administrative agent and collateral agent. Under the Amended Credit Agreement, a syndicate of financial institutions and other lenders provided (i) additional term loan A commitments in the amount of $60.0 million (the “Incremental TLA Facility”) and (ii) a new tranche of term loan B commitments in the amount of $600.0 million (the “New TLB Facility,” and together with the Incremental TLA Facility, the “Facilities”). The $600.0 million term loan B facility matures on October 30, 2030 (the “Term Loan B Maturity Date”). Unless otherwise indicated, the terms and conditions detailed below apply to both term loan A facility and term loan B (together “Term Loan Facilities”). In the fourth quarter of 2023, the Company prepaid $60 million of the outstanding balance on Term Loan B.

At March 31, 2024, the unpaid principal balance of the Term A Loan Facility and Term B Loan Facility were $447.5 million and $540.0 million, respectively. At March 31, 2024, the outstanding balance of the Revolving Facility is $80 million and the additional borrowing capacity was $114.0 million. The Company issues letters of credit against the Revolving Facility which reduce the additional borrowing capacity of the Revolving Facility.

Deferred consideration for Business Combinations

As part of the Company’s merger and acquisition activities, the Company may enter into agreements by which a portion of the purchase price is financed directly by the seller. At March 31, 2024 and December 31, 2023, the unpaid principal balance of these agreements amounted to $18.9 million and $19.5 million, respectively. The current portion of the deferred consideration is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Notes Payable

In September 2023, EVERTEC Group entered into a non-interest bearing financing agreement amounting to $10.1 million to purchase software and maintenance which the Company recorded on a discounted basis using an implied interest of 6.9%. As of March 31, 2024, the outstanding principal balance of the note payable on a discounted basis was $7.2 million. The current

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portion of the note is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Interest Rate Swaps

As of March 31, 2024, the Company has four interest rate swap agreements, which convert a portion of the interest rate payments on the Company's Term Loan Facilities from variable to fixed. The interest rate swaps are used to hedge the market risk from changes in interest rates corresponding with the Company's variable rate debt. The interest rate swaps are designated as cash flow hedges and are considered highly effective. Changes in the fair value of the interest rate swaps are recognized in other comprehensive income (loss) until the gains or losses are reclassified to earnings. Gains or losses reclassified to earnings are presented within interest expense in the accompanying condensed consolidated statements of income and comprehensive income.

Swap Agreement	Effective date	Maturity Date	Notional Amount	Variable Rate	Fixed Rate
2018 Swap	April 2020	November 2024	$250 million	1-month SOFR	2.929%
2023 Swap	November 2024	December 2027	$250 million	1-month SOFR	3.375%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.182%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.172%

As of March 31, 2024, the carrying amount of the derivatives included on the Company's unaudited condensed consolidated balance sheets was an asset of $7.0 million and a liability of $0.9 million, included in other long-term liabilities. As of December 31, 2023, the carrying amount of the derivatives included on the Company's consolidated balance sheet was an asset of $4.4 million and a liability of $0.9 million, included in other long-term liabilities. The fair value of these derivatives are estimated using Level 2 inputs in the fair value hierarchy on a recurring basis. Refer to Note 8 to the Unaudited Condensed Consolidated Financial Statements for disclosure of gains (losses) recorded on cash flow hedging activities.

During the three months ended March 31, 2024 and 2023, the Company reclassified gains of $1.7 million and $1.0 million, respectively, from accumulated other comprehensive loss into interest expense. Based on current SOFR rates, the Company expects to reclassify gains of $10.0 million from accumulated other comprehensive loss into interest expense over the next 12 months.

Covenant Compliance

As of March 31, 2024, the total secured net leverage ratio was 2.50 to 1.00. As of the date of filing of this Report, no event has occurred that constitutes an Event of Default or Default.

In this Report, we refer to the term “Adjusted EBITDA” to mean EBITDA as so defined and calculated in a substantially consistent manner for purposes of determining compliance with the total secured net leverage ratio based on the financial information for the last twelve months at the end of each quarter.

Net Income Reconciliation to EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings per common share (Non-GAAP Measures)

The non-GAAP measures referenced in this Report are supplemental measures of the Company’s performance and are not required by, or presented in accordance with, accounting principles generally accepted in the United States of America (“GAAP”). They are not measurements of the Company’s financial performance under GAAP and should not be considered as alternatives to total revenue, net income or any other performance measures derived in accordance with GAAP or as alternatives to cash flows from operating activities, as indicators of operating performance or as measures of the Company’s liquidity. In addition to GAAP measures, management uses these non-GAAP measures to focus on the factors the Company believes are pertinent to the daily management of the Company’s operations and believes that they are also frequently used by analysts, investors and other stakeholders to evaluate companies in our industry. These measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our condensed consolidated statements of operations that are necessary to run our business. Other companies, including other companies in our industry, may not use these measures or may calculate these measures differently than as presented herein, limiting their usefulness as comparative measures.

Reconciliations of the non-GAAP measures to the most directly comparable GAAP measure are included below. These non-GAAP measures include EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings per common share, each as defined below.

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EBITDA is defined as earnings before interest, taxes, depreciation and amortization.

Adjusted EBITDA is defined as EBITDA further adjusted to exclude certain non-cash items and unusual expenses such as: share-based compensation, restructuring related expenses, fees and expenses from corporate transactions such as M&A activity and financing, equity investment income net of dividends received, and the impact from unrealized gains and losses on foreign currency remeasurement for assets and liabilities in non-functional currency. This measure is reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. For this reason, Adjusted EBITDA, as it relates to the Company's segments, is presented in conformity with Accounting Standards Codification 280, Segment Reporting, and is excluded from the definition of non-GAAP financial measures under the Securities and Exchange Commission's Regulation G and Item 10(e) of Regulation S-K. The Company’s presentation of Adjusted EBITDA is substantially consistent with the equivalent measurements that are contained in the secured credit facilities in testing EVERTEC Group’s compliance with covenants therein such as the secured leverage ratio. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of total revenues.

Adjusted Net Income is defined as Adjusted EBITDA less: operating depreciation and amortization expense, defined as GAAP Depreciation and amortization less amortization of intangibles related to acquisitions such as customer relationships, trademarks; cash interest expense defined as GAAP interest expense, less GAAP interest income adjusted to exclude non-cash amortization of debt issue costs, premium and accretion of discount; income tax expense which is calculated on adjusted pre-tax income using the applicable GAAP tax rate, adjusted for uncertain tax positions, tax true-ups, windfall from share-based compensation, unrealized gains and losses from foreign currency remeasurement, among others; and non-controlling interests, net of amortization for intangibles created as part of the purchase.

Adjusted Earnings per common share is defined as Adjusted Net Income divided by diluted shares outstanding.

The Company uses Adjusted Net Income to measure the Company’s overall profitability because the Company believes it better reflects the comparable operating performance by excluding the impact of the non-cash amortization and depreciation that was created as a result of merger and acquisition activity. In addition, in evaluating EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings per common share, you should be aware that in the future the Company may incur expenses such as those excluded in calculating them.

A reconciliation of net income to EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings per common share is provided below:

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	Three months ended March 31,				Twelve months ended
(In thousands, except per share information)	2024		2023		March 31, 2024
Net income	$	16,387	$	30,063	$	66,200
Income tax expense	292		2,818		2,951
Interest expense, net	16,579		4,510		35,878
Depreciation and amortization	34,441		19,432		108,630
EBITDA	67,699		56,823		213,659
Equity income (1)	(1,071)		(1,155)		(1,861)
Compensation and benefits (2)	7,990		5,845		31,457
Transaction, refinancing and other (3)	(897)		758		51,890
Loss on foreign currency remeasurement (4)	4,456		4,864		7,868
Adjusted EBITDA	78,177		67,135		303,013
Operating depreciation and amortization (5)	(14,795)		(12,369)		(55,339)
Cash interest expense, net (6)	(15,419)		(4,363)		(35,342)
Income tax benefit (expense) (7)	462		(4,782)		(23,794)
Non-controlling interest (8)	(421)		(34)		(644)
Adjusted net income	$	48,004	$	45,587	$	187,894
Net income per common share (GAAP):
Diluted	$	0.24	$	0.46
Adjusted Earnings per common share (Non-GAAP):
Diluted	$	0.72	$	0.69
Shares used in computing adjusted earnings per common share:
Diluted	66,336,679		65,608,618

1)Represents the elimination of non-cash equity earnings from our equity investments. 

2)Primarily represents share-based compensation and severance payments.

3)Represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, recorded as part of selling, general and administrative expenses and the elimination of unrealized gains from the change in fair market value of equity securities.

4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

5)Represents operating depreciation and amortization expense, which excludes amounts generated as a result of merger and acquisition activity.

6)Represents interest expense, less interest income, as they appear on the condensed consolidated statements of income and comprehensive (loss) income, adjusted to exclude non-cash amortization of the debt issue costs, premium and accretion of discount.

7)Represents income tax expense calculated on adjusted pre-tax income using the applicable GAAP tax rate, adjusted for certain discrete items.

8)Represents the non-controlling equity interest, net of amortization for intangibles created as part of the purchase.

Critical Accounting Estimates

Our consolidated financial statements are prepared in accordance with GAAP. In connection with the preparation of our financial statements, we are required to make estimates and assumptions about future events and apply judgments that affect the reported amounts of certain assets and liabilities, and in some instances, the reported amounts of revenues and expenses during the period. We base our assumptions, estimates, and judgments on historical experience, current events, and other factors that management believes to be relevant at the time our condensed consolidated financial statements are prepared. However, because future events are inherently uncertain and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. For a description of the Company’s critical accounting estimates, refer to “Part II—Item 7-Management’s Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Estimates” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on February 29, 2024.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risks arising from our normal business activities. These market risks principally involve the possibility of changes in interest rates that will adversely affect the value of our financial assets and liabilities or future cash flows and earnings, foreign currency exchange risk that may result in unfavorable foreign currency translation adjustments and inflation. Market risk is the potential loss arising from adverse changes in market rates and prices. The following analysis provides quantitative and qualitative information regarding these risks.

Interest Rate Risks

Interest rate risk is highly sensitive due to many factors, including U.S. monetary and tax policies, U.S. and international economic factors and other factors beyond our control.

We issued floating-rate debt which is subject to fluctuations in interest rates. Our secured credit facilities accrue interest at variable rates and are subject to a floor or a minimum rate. Based upon a sensitivity analysis of our outstanding debt on March 31, 2024, a hypothetical 100 basis point increase in interest rates over our floor on our debt balances outstanding as of March 31, 2024, under the secured credit facilities, would increase our annual interest expense by approximately $5.2 million. The impact on future interest expense as a result of future changes in interest rates will depend largely on the gross amount of our borrowings at that time.

As of March 31, 2024, the Company has four interest rate swap agreements which convert a portion of the interest rate payments on the Company's Term Loan Facilities from variable rate debt to fixed.

The interest rate swap exposes us to credit risk in the event that the counterparty to the swap agreement does not or cannot meet its obligations. The notional amount is used to measure interest to be paid or received and does not represent the amount of exposure to credit loss. The loss would be limited to the amount that would have been received, if any, over the remaining life of the swap. The counterparties to the swaps are major U.S. based financial institution and we expect all counterparties to be able to perform its obligations under the swaps. We use derivative financial instruments for hedging purposes only and not for trading or speculative purposes.

See Note 5 of the Unaudited Condensed Consolidated Financial Statements for additional information related to the secured credit facilities.

Foreign Exchange Risk

We conduct business in certain countries in Latin America for which we have determined that the functional currency is other than the U.S. dollar. Given this, our operating results are exposed to volatility due to fluctuations in exchange rates for the countries' functional currencies. Non-functional currency transactions are remeasured into the functional currency which results in a foreign exchange gain or loss recorded through Other income (expenses). For the quarters ended March 31, 2024 and March 31, 2023 the Company recognized non-cash unrealized foreign currency remeasurement losses of $4.5 million and $4.9 million of losses, respectively. For subsidiaries whose functional currency is other than the U.S. dollar, their assets and liabilities are translated into U.S. dollars at exchange rates at the balance sheet date, and revenues and expenses are translated using average exchange rates in effect during the period. The resulting foreign currency translation adjustments are reported in accumulated other comprehensive income (loss) in the condensed consolidated balance sheets. As of March 31, 2024, the Company had $11.6 million in an unfavorable foreign currency translation adjustment as part of accumulated other comprehensive (loss) income compared with a favorable foreign currency translation adjustment of $14.8 million as of December 31, 2023.

Inflation Risk

While it is difficult to accurately measure the impact of inflation on our results of operations and financial condition, we believe the effects of inflation, if any, on our historical results of operations and financial condition have been immaterial. General inflation in the geographies in which we operate has risen to levels that have not been experienced in recent years, however, inflation has historically had a minimal net effect on our operating results given that overall inflation has been offset by sales and cost reduction actions. Rising prices for input costs, including wages and benefits, occupancy and general administrative costs, could potentially have a negative impact on our results of operations and financial condition which may not be readily recoverable from our customers. In addition, inflation has driven a rising interest rate environment, which has had an adverse effect on our cost of funding, as well as led to enhanced volatility on foreign currency exchange rates. While we proactively try to mitigate these rising costs, we may not be able to fully offset these impacts, which could result in negative effect on our

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results of operation. Thus, we cannot assure you that our results of operations and financial condition will not be materially impacted by inflation in the future.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of the Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Report. Based upon their evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that as of March 31, 2024, the Company’s disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

We completed the Sinqia acquisition on November 1, 2023 (see Note 2 of the Notes to the Unaudited Condensed Consolidated Financial Statements). We excluded Sinqia's disclosure controls and procedures that are subsumed by its internal control over financial reporting from the scope of management's assessment of the effectiveness of the Company's disclosure controls and procedures. This exclusion is in accordance with the SEC Staff’s general guidance that an assessment of a recently acquired business may be omitted from the scope of management’s assessment for one year following the acquisition. We are in and will continue with the process of integrating Sinqia into our overall internal control environment. We believe that we have taken the necessary steps to monitor and maintain appropriate internal control over financial reporting during this ongoing integration. Except as described above, there have been no changes in our internal control over financial reporting that occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are defendants in various lawsuits or arbitration proceedings arising in the ordinary course of business. Management believes, based on the opinion of legal counsel and other factors, that the aggregated liabilities, if any, arising from such actions will not have a material adverse effect on the financial condition, results of operations and the cash flows of the Company.

Item 1A. Risk Factors

There have been no material changes to the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 29, 2024. For a discussion of the potential risks and uncertainties related to us, see "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table summarizes repurchases of the Company’s common stock in the three month period ended March 31, 2024:

Period	Total number of shares purchased	Average price paid per share	Total number of shares purchased as part of a publicly announced program (1)	Approximate dollar value of shares that may yet be purchased under the program
3/1/2024-3/31/2024	1,516,793	*	1,516,793
	1,516,793		1,516,793	$	150,000,000

(1) On March 4, 2024 the Board approved an increase to Evertec’s existing share repurchase authorization to permit future repurchases of up to an aggregate of $220 million worth of shares of the Company’s common stock, par value $0.01 per share by December 31, 2025. Under the repurchase program, the Company may repurchase shares in the open market, through accelerated share repurchase programs, Rule 10b5-1 plans, or in privately negotiated transactions, subject to business opportunities and other factors. The total number of shares includes 1.5 million shares received from the initiation of our ASR agreement that we entered into on March 2024.

*Average price paid per share information does not include this accelerated share repurchase transaction.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the three months ended March 31, 2024 no director or “officer” (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted, terminated or modified a “Rule 10b5-41 trading arrangement” or non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K, except as follows: On March 5, 2024, the Company’s President and Chief Executive Officer, Morgan M. Schuessler, terminated a “Rule 105b-1 trading arrangement,” (as defined in Item 408(a) of Regulation S-K) which was adopted on August 30, 2023, provided for the sale of up to 84,467 shares of the Company’s common stock, and had a planned end date of October 4, 2024.

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Item 6. Exhibits

2.1#	Merger Agreement and Other Covenants, dated July 20, 2023 (incorporated by reference to Exhibit 2.1 of EVERTEC, Inc.’s Current Report on Form 8-K filed on July 21, 2023, File No. 001-35872).
3.1	Third Amended and Restated Certificate of Incorporation of EVERTEC, Inc., dated as of May 25, 2023 (incorporated by reference to Exhibit 3.1 of EVERTEC, Inc.’s Current Report on Form 8-K filed on June 1, 2023, File No. 001-35872).
3.2	Amended and Restated Bylaws of EVERTEC, Inc., dated as of May 25, 2023 (incorporated by reference to Exhibit 3.2 of EVERTEC, Inc.’s Current Report on Form 8-K filed on June 1, 2023, File No. 001-35872).
10.1*+	Form of Restricted Stock Unit Award Agreement for grant of restricted stock units for Executive Officers under the EVERTEC, Inc. 2022 Incentive Award Plan, dated February 29, 2024.
10.2*+	Form of Restricted Stock Unit Award Agreement for grant of restricted stock units for Karla M. Cruz-Jusino under the EVERTEC, Inc. 2022 Incentive Award Plan, dated February 29, 2024.
10.3*+	Form of Restricted Stock Unit Award Agreement for grant of restricted stock units for Karla M. Cruz-Jusino under the EVERTEC, Inc. 2022 Incentive Award Plan, dated February 24, 2023.
10.4*+	Form of Restricted Stock Unit Award Agreement for grant of restricted stock units for Karla M. Cruz-Jusino under the EVERTEC, Inc. 2022 Incentive Award Plan, dated February 25, 2022.
31.1*	CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS XBRL*	Inline Instance document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH XBRL*	Inline Taxonomy Extension Schema
101.CAL XBRL*	Inline Taxonomy Extension Calculation Linkbase
101.DEF XBRL*	Inline Taxonomy Extension Definition Linkbase
101.LAB XBRL*	Inline Taxonomy Extension Label Linkbase
101.PRE XBRL*	Inline Taxonomy Extension Presentation Linkbase
104*	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*    Filed herewith.

**    Furnished herewith.

# Certain exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished to the Securities and Exchange Commission upon request.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EVERTEC, Inc. (Registrant)
Date: May 2, 2024	By:	/s/ Morgan Schuessler
		Morgan Schuessler Chief Executive Officer (Principal Executive Officer)
Date: May 2, 2024	By:	/s/ Joaquin A. Castrillo-Salgado
		Joaquin A. Castrillo-Salgado Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

38

EX-10.1

EXHIBIT 10.1

EVERTEC, INC.

2022 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT - EXECUTIVES

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (together with the Vesting Schedule (defined below), this “Agreement”) is made as of this 29th day of February, 2024 (the “Date of Grant”), by and between EVERTEC, Inc. (the “Company”) and you (the “Participant”). Defined terms used but not otherwise defined herein will have the meanings attributed to them in the Plan (defined below).

W I T N E S S E T H

WHEREAS, the Company maintains the EVERTEC, Inc. 2022 Equity Incentive Plan (the “Plan”); and

WHEREAS, the Participant may be a senior executive of the Company who is subject to the Evertec Group, LLC Executive Severance Policy in effect as of the date of this Agreement (if applicable, the “Policy”), which Policy has been approved and authorized by the Compensation Committee or the Board of Directors of the Company; and

WHEREAS, the Participant may be a senior executive of the Company who has a valid employment agreement as of the date hereof that has been approved and authorized by the Compensation Committee or the Board of Directors of the Company (if applicable, the “ExecutiveEmployment Agreement”); and

WHEREAS, in connection with the Participant’s service as an employee of the Company or any of its Affiliates and Subsidiaries (the “Employment”), the Company desires to grant Restricted Stock Units (“RSUs”) to the Participant (the “Award”), subject to the terms and conditions of the Plan and this Agreement; and

WHEREAS, such RSUs could be time-based RSUs (“Time-Based RSUs”), which vest on a future specified date or dates, as specified in Exhibit A; and

WHEREAS, such RSUs could also be performance-based RSUs (“Performance-Based RSUs”), which vest on a future specified date or dates and are subject to certain performance metrics, as specified in Exhibit A.

NOW, THEREFORE, in consideration of the covenants and agreements contained herein and for other good and valuable consideration, the parties agree as follows:

1.Grant of RSUs. In consideration of the Employment, the Company will grant to the Participant the number of RSUs set forth in the vesting schedule attached hereto as Exhibit A (the “Vesting Schedule”). Each RSU represents the unfunded and unsecured promise of the Company to deliver to the Participant one share of common stock, par value $.01 per share, of the Company (the “Common Stock”) on the Settlement Date (as defined in Section 6 hereof).

2.Purchase Price. The purchase price of the RSUs shall be deemed to be zero U.S. Dollars ($0) per share.

3.Vesting. The RSUs shall vest and become non-forfeitable on the dates established in the Vesting Schedule (each such date, a “Vesting Date”), provided that the Participant is actively carrying out his or her duties in connection with the Employment at all times from the Date of Grant through each respective Vesting Date.

4.Termination. For purposes of this Section 4, “Termination Date” is the date the Participant’s Employment is terminated or terminates. This Section 4 shall govern the treatment of the RSUs granted

under this Agreement upon the Participant’s termination of Employment; provided, however, that if the Participant’s Executive Employment Agreement addresses the treatment of RSUs upon termination, then the provisions of such Executive Employment Agreement shall govern instead of this Section 4. Defined terms used but not otherwise defined in this Section 4 or in the Plan will have the meanings attributed to them in the Policy.

(a)In the event that the Employment is terminated in a Qualifying Termination (as defined in the Policy) other than within 24 months following a Change in Control (as defined in the Policy), then:

(i)Unvested RSUs that are Time-Based shall vest on a pro-rata basis as of the Termination Date and the Termination Date shall be deemed to be the Vesting Date under this Agreement; and

(ii)Unvested RSUs that are Performance-Based, shall vest and be settled following the end of the performance period based on actual performance determined at the end of the performance period on a pro-rata basis.

(iii)For purposes of clauses 4(a)(i) and (ii), the pro-rata portion of the award that will become vested shall be determined by multiplying the total number of RSUs subject to the award, by a fraction, the numerator of which is the number of completed months in which the Participant was employed from the Date of Grant to the Termination Date, and the denominator of which is the number of months required for the award to vest in full under the Vesting Schedule, and then reducing therefrom the number of RSUs that have previously been vested, if any.

(b)In the event that the Employment is terminated in a Qualifying Termination within 24 months following a Change in Control, then, subject to the Participant’s compliance with Section 11:

(i)Unvested RSUs that are Time-based shall become fully vested and the Termination Date shall be deemed to be the Vesting Date under this Agreement; and

(ii)Unvested RSUs that are Performance-based, shall become fully vested upon the Qualifying Termination (x) based on actual level of performance achieved as of the Change in Control (to the extent the performance period with respect to the relevant goal was completed as of the Change in Control date) and (y) at the target level of performance (to the extent the performance period with respect to the relevant goal was not complete as of the Change in Control date) and the Termination Date shall be deemed to be the Vesting Date under this Agreement. For the avoidance of doubt, it is understood that there may be circumstances where a component of an unearned performance award is valued based on actual performance and a separate component is valued based on target performance. The Company, in its sole discretion, shall determine the number of RSUs that vest pursuant to this provision, if any.

(c)For the avoidance of doubt, in no event shall the Participant become entitled to accelerated vesting of the Participant’s RSUs under both Sections 4(a) and 4(b).

(d)In the event of the Employment’s termination due to Participant’s death or Disability (defined below), then as of the Termination Date all of the unvested Time-Based RSUs shall become fully vested and all unvested Performance-Based RSUs shall become fully vested (x) based on actual level of performance achieved as of the Termination Date (to the extent the performance period with respect to the relevant goal was completed as of the Termination Date) and (y) at the target

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level of performance (to the extent the performance period with respect to the relevant goal was not complete as of the Termination Date). For the avoidance of doubt, it is understood that there may be circumstances where a component of an unearned performance award(s) is valued based on actual performance and a separate component is valued based on target performance.

“Disability” has the following meaning: the Participant’s inability to perform the Employment by reason of any medically determinable physical or mental impairment for a period of 6 months or more in any 12 month period.

(e)In the event the Employment is terminated or terminates other than in a Qualifying Termination, all of the RSUs (both Time-Based and Performance-Based) that have not become vested as of the Termination Date shall automatically be forfeited as of the Termination Date.

(f)Release Requirement. As a condition to the acceleration of vesting (or the continued vesting post-termination of Performance-based RSUs based on the achievement of Company business performance) pursuant to Section 4(a), (b) or (d) of this Agreement, the Participant, if legally capable at such time, or his estate, beneficiaries or legal representatives, if Participant is deceased or legally incapable at such time, shall be obligated to execute a separation agreement and general release of all claims in favor of the Company, their current and former affiliates, subsidiaries and stockholders, and their current and former directors, officers, employees, insurers and agents, in a form reasonably determined by the Company; provided, however, that, if such release is not executed within the time required by the Company, or is revoked within 7 days of execution, the Company shall not have any obligation to provide the benefits under Section 4(a), (b) or (d) under this Agreement.

5.Dividend Equivalents. If the Company pays an ordinary cash dividend on its outstanding Common Stock at any time between the Date of Grant and the Settlement Date (as defined in Section 6 below) -- provided that the date on which stockholders of record are determined for purposes of paying a cash dividend on issued and outstanding shares of the Common Stock falls after the Date of Grant -- the Participant shall receive on the Settlement Date or at the next payroll payment (but in no event more than 75 days after the Vesting Date) either: (a) a number of Shares (as defined in Section 6 below) having a Fair Market Value (as defined below) on the Vesting Date equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date; or (b) a lump sum cash payment equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date ((a) or (b) as applicable, the “Dividend Payment”); provided, however, that in the case of (a), any partial Share resulting from the calculation will be paid in cash.

For purposes of this Agreement, “Fair Market Value” means the closing price of the Company’s Common Stock at the close of business of the applicable date.

6.Settlement. Within 75 days following the day any RSUs are vested in accordance with the terms and conditions of this Agreement (the “Settlement Date”), the Company shall (a) issue and deliver to the Participant one share of Common Stock for each vested RSU (the “Shares”) and enter the Participant’s name as a shareholder of record or beneficial owner with respect to the Shares on the books of the Company; and (b) calculate the Dividend Payment. The Participant agrees that the Company may deduct from the Dividend Payment any amounts owed by the Participant to the Company with respect to any whole Share issued by the Company to the Participant to cover any partial Share resulting from the settlement process.

7.Restrictive Covenants. The Participant hereby acknowledges that he or she is subject to all of the requirements and conditions in his or her Executive Employment Agreement or in the Restatement of

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Confidentiality and Non-Compete Agreements, as applicable, (the “Covenant Agreements”) previously executed by him or her and that he or she will continue to comply with such Covenant Agreements. Furthermore, the Participant acknowledges that the RSUs granted hereunder serve as sufficient consideration for the reaffirmation of the Covenant Agreements contained herein.

8.Taxes. Unless otherwise required by applicable law, on the Settlement Date, (a) the Shares and the Dividend Payment will be considered ordinary income for tax purposes and subject to all applicable payroll taxes; (b) the Company shall report such income to the appropriate taxing authorities as it determines to be necessary and appropriate; (c) the Participant shall be responsible for payment of any taxes due in respect of the Shares and the Dividend Payment; and (d) the Company shall withhold taxes in respect of the Shares and the Dividend Payment (a “Tax Payment”). In order to satisfy the Participant’s obligation to pay the Tax Payment, the Company will withhold from any Shares otherwise to be delivered to the Participant, a number of whole shares of Common Stock having a Fair Market Value equal to the Tax Payment (i.e., a “cashless exercise”); provided, however, that the Participant may elect to satisfy his or her obligation to pay the Tax Payment through a non-cashless exercise, by notifying the Company within at least 5 business days before the Settlement Date. If the Participant does not provide such notification within the established timeframe, the Company will proceed with the default method of the cashless exercise. If the Participant fails to pay any required Tax Payment, the Company may, in its discretion, deduct any Tax Payments from any amount then or thereafter payable by the Company to the Participant and take such other action as deemed necessary to satisfy all obligations for the Tax Payment (including reducing the number of Shares delivered on the Settlement Date). The Participant agrees to pay the Company in the form of a check or cashier’s check any overage of the Tax Payment paid by the Company as a result of making whole any partial Share issued through a cashless exercise. Furthermore, the Participant acknowledges and agrees that the Participant will be solely responsible for making any Tax Payment directly to the appropriate taxing authorities should the Participant opt not to satisfy his or her Tax Payment through a cashless exercise.

9.Rights as Stockholder. Upon and following the Settlement Date (but not before), the Participant shall be the record or beneficial owner of the Shares unless and until such Shares are sold or otherwise disposed of, and, if a record owner, shall be entitled to all rights of a stockholder of the Company (including voting rights).

10.Section 409A. Although the Company does not guarantee the tax treatment of any payments under this Agreement, the intent of the Company is that the payments under this Agreement be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and all Treasury Regulations and guidance promulgated thereunder (“Code Section 409A”) under the “short-term deferral exception” and to the maximum extent permitted the Agreement shall be limited, construed and interpreted in accordance with such intent. The Company intends that the performance conditions applicable to the Performance-Based RSUs relate to the Company’s business activities and/or organizational goals within the meaning of Treas. Reg. 1.409A-1(d)(1). In no event whatsoever shall the Company or its affiliates or their respective officers, directors, employees or agents be liable for any additional tax, interest or penalties that may be imposed on the Participant by Code Section 409A or damages for failing to comply with Code Section 409A. Notwithstanding the foregoing or any other provision of this Agreement to the contrary, if at the time of the Participant’s separation from service (as defined in Code Section 409A), the Participant is a “Specified Employee,” then the Company will defer the payment or commencement of any nonqualified deferred compensation subject to Code Section 409A payable upon separation from service (without any reduction in such payments or benefits ultimately paid or provided to the Participant) until the date that is 6 months following separation from service or, if earlier, the earliest other date as is permitted under Code Section 409A (and any amounts that otherwise would have been paid during this deferral period will be paid in a lump sum on the day after the expiration of the 6 month period or such shorter period, if applicable). The Participant will be a “Specified Employee” for purposes of this Agreement if, on the date of the Participant’s separation from service, the Participant is an individual who is, under the method of

4

determination adopted by the Company designated as, or within the category of employees deemed to be, a “Specified Employee” within the meaning and in accordance with Treasury Regulation Section 1.409A-1(i). The Company shall determine in its sole discretion all matters relating to who is a “Specified Employee” and the application of and effects of the change in such determination.

11.Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the Commonwealth of Puerto Rico applicable to contracts to be performed therein.

12.Notice. Every notice or other communication relating to this Agreement shall be made in writing and the notice, request or other communication shall be deemed to be received upon receipt by the party entitled thereto. Any notice, request or other communication by the Participant should be delivered to the Company’s Chief Legal Officer.

13.Miscellaneous. This Agreement, the Plan and the Covenant Agreements contain the entire agreement between the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations, and negotiations in respect thereto. No change, modification, or waiver of any provision of this Agreement shall be valid unless in writing and signed by the parties hereto. This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Participant, acquire any rights hereunder in accordance with this Agreement or the Plan. The terms and provisions of the Plan and the Vesting Schedule are incorporated herein by reference, and the Participant hereby acknowledges receiving a copy of the Plan. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.

By clicking “I Accept” in the checkbox below, the Participant is hereby agreeing to the terms and conditions of this Agreement as of the Date of Grant set forth above, and that he or she has read the same, including the Vesting Schedule.

5

Exhibit A – Vesting Schedule

Number of Time-Based RSUs to vest	Vesting Date
[*]	02/28/2025
[*]	02/28/2026
[*]	02/28/2027

Number of Performance-Based RSUs to vest	Vesting Date
[*] Adjusted EBITDA RSUs with TSR Modifier	02/28/2027

Participant’s Performance-Based RSUs are governed by the following terms and conditions:

1.Defined Terms. All capitalized terms used, but not defined in this Exhibit A, shall have the meanings attributed to them in the Agreement.

1)“Accumulated Shares” means, for a given trading day, the sum of (a) one (1) share and (b) a cumulative number of shares of a company’s common stock purchased with dividends declared on a company’s common stock, assuming same day reinvestment of the dividends in the common stock of the company at the closing price on the ex-dividend date, for ex-dividend dates during the Opening Average Period or between the Date of Grant and the Vesting Date, as applicable.

2)“Adjusted EBITDA” means the Company’s earnings before interest, taxes, depreciation and amortization, after all typical and applicable adjustments made by the Company.

3)“Closing Average Period” means the last 20 trading days of the Relative TSR Performance Period.

4)“Closing Average Share Value” means the average, over the trading days in the Closing Average Period, of the closing price of a company’s stock multiplied by the Accumulated Shares for each trading day during the Closing Average Period.

5)“Adjusted EBITDA Performance Period” means the one-year period commencing on January 1, 2024 and ending on December 31, 2024, consistent with the Company’s fiscal year.

6)“Grant Date Fair Value” means a value arrived at by projecting future stock prices for the Company and the Peer Companies while allowing for greater flexibility and customization of the assumptions and plan design parameters which is necessary to value the Adjusted EBITDA RSUs with a Relative TSR Multiplier.

7)“Opening Average Period” means the 20 trading days immediately preceding the first day of the Relative TSR Performance Period.

8)“Opening Average Share Value” means the average, over the trading days in the Opening Average Period, of the closing price of a company’s stock multiplied by the Accumulated Shares for each trading day during the Opening Average Period.

9)“Peer Companies” means the constituents of the Russell 2000 Index as of January 1, 2024.

10)“Performance Period” means the 3-year period commencing on the Date of Grant and ending on the third-anniversary of the Date of Grant.

11)“Relative TSR” is a performance metric that compares the Company’s TSR to the TSR of each of the Peer Companies using the methodology set forth herein.

12)“Relative TSR Multiplier” is the multiplier that will be applied to the Adjusted EBITDA RSUs at the end of the Relative TSR Performance Period.

13)“Relative TSRPerformance Period” means the Performance Period for which the TSR metrics for Performance-Based RSUs will be measured.

14)“TSR” (Total Shareholder Return) means the change in fair market value over a specified period of time, expressed as a percentage, which will be calculated by dividing (a) the Closing Average Share Value by (b) the Opening Average Share Value and subtracting one from the quotient.

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2.Metrics for Performance-Based RSUs

The Company will use the following metrics and criteria for calculating the Performance-Based RSUs:

a)The target number of Performance-Based RSUs that the Participant is granted has been allocated to Adjusted EBITDA RSUs and will be subject to the Relative TSR Multiplier. The actual number of Performance-Based Adjusted EBITDA RSUs with a Relative TSR Multiplier was determined by dividing this portion of the Award’s value by the Grant Date Fair Value.

b)The Adjusted EBITDA RSUs will be based on the Company’s actual one-year Adjusted EBITDA measured over the Adjusted EBITDA Performance Period relative to the goals established below.

Performance Level	EVERTEC Adjusted 1-Year EBITDA (millions)	Earned Percentage
Maximum	360.1	200%
Target	327.4	100%
Threshold	311.0	60%
Less Than	311.0	0%

c)The number of RSUs that are eligible to vest may be greater or less than the resulting number of earned Adjusted EBITDA RSUs depending on the level of attainment of Relative TSR over the Relative TSR Performance Period based on the following percentile approach.

Performance Level	Evertec Percentile Rank vs. Peer Companies	Relative TSR Multiplier
Maximum	75th Percentile or Above	1.25
Target	50th Percentile	1.00
Threshold	≤ 35th Percentile	0.75

d)The total number of Performance-Based RSUs that will actually vest will be equal to: Target EBITDA RSUs * Earned Percentage * Relative TSR Multiplier.

e)The actual level of the Earned Percentage and Relative TSR Multiplier will be based on a linear interpolation between threshold and target and between target and maximum levels.

f)In the event of a payout percentage level above 100%, the Participant will be awarded additional RSUs so that the total number of RSUs which vest as of the Vesting Date equals the RSU amount as calculated in item (d) above. In the event of a payout percentage level below 100%, the original RSU Award amount will be reduced to the extent necessary to provide that the total number of RSUs which vest as of the Vesting Date equals the RSU amount as calculated in item (d) above (any such reduced RSUs to be considered forfeited). This same method will apply to the calculation of dividend equivalents and any shares of Common Stock issued as a result thereof.

g)Relative TSR will be determined by ranking the Company and the Peer Companies from highest to lowest according to their respective TSRs. After this ranking, the percentile performance of the Company relative to the Peer Companies will be determined as follows:

P = the percentile performance (rounded to the nearest whole percentile)

N = the number of Peer Companies, plus the Company

R = the Company’s ranking among the Peer Companies

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Example: if there are 24 Peer Companies, and Evertec ranked 7th, the performance would
be at the 75th percentile:

.75 = 1 – ((7-1)/(25-1))

h)The Peer Companies may be changed if any of the following events occur during the Relative TSR Performance Period:

1.In the event of a merger, acquisition or business combination transaction of a Peer Company with another Peer Company, the surviving entity shall remain a Peer Company.

2. In the event of a merger, acquisition or business combination transaction of a Peer Company with an entity that is not a Peer Company, where the Peer Company is the surviving entity and remains publicly traded, the surviving entity shall remain a Peer Company.

3. In the event of a merger or acquisition or business combination transaction of a Peer Company with an entity that is not a Peer Company, where the Peer Company is not the surviving entity or is otherwise no longer publicly traded, the Peer Company shall be removed from the list of Peer Companies.

4. In the event of a bankruptcy of a Peer Company, or if a Peer Company is delisted, such Peer Company shall remain a Peer Company, but will be allocated a TSR at the lowest position in the final calculation of the percentile rankings.

5. In the event of a stock distribution from a Peer Company consisting of the shares of a new publicly-traded company (a “spin-off”), the Peer Company shall remain a Peer Company and the stock distribution shall be treated as a dividend from the Peer Company based on the closing price of the shares of the spun-off company on its first day of trading. The performance of the shares of the spun-off company shall not thereafter be tracked for purposes of calculating TSR.

8

EX-10.2

EXHIBIT 10.2

EVERTEC, INC.

2022 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (together with the Vesting Schedule (defined below), this “Agreement”) is made as of this 29th day of February, 2024 (the “Date of Grant”), by and between EVERTEC, Inc. (the “Company”) and you (the “Participant”). Defined terms used but not otherwise defined herein will have the meanings attributed to them in the Plan (defined below).

W I T N E S S E T H

WHEREAS, the Company maintains the EVERTEC, Inc. 2022 Equity Incentive Plan (the “Plan”);

WHEREAS, in connection with the Participant’s service as an employee of the Company or any of its Affiliates and Subsidiaries (the “Employment”), the Company desires to grant Restricted Stock Units (“RSUs”) to the Participant (the “Award”), subject to the terms and conditions of the Plan and this Agreement; and

WHEREAS, such RSUs will be time-based RSUs (“Time-Based RSUs”), which vest on a future specified date or dates, as specified in Exhibit A.

NOW, THEREFORE, in consideration of the covenants and agreements contained herein and for other good and valuable consideration, the parties agree as follows:

1.Grant of RSUs. In consideration of the Employment, the Company will grant to the Participant the number of RSUs set forth in the vesting schedule included herein as Exhibit A (the “Vesting Schedule”). Each RSU represents the unfunded and unsecured promise of the Company to deliver to the Participant one share of common stock, par value $.01 per share, of the Company (the “Common Stock”) on the Settlement Date (as defined in Section 6 hereof).

2.Purchase Price. The purchase price of the RSUs shall be deemed to be zero U.S. Dollars ($0) per share.

3.Vesting. The RSUs shall vest and become non-forfeitable on the dates established in the Vesting Schedule (each such date, a “Vesting Date”), provided that the Participant is actively carrying out his or her duties in connection with the Employment at all times from the Date of Grant through each respective Vesting Date.

4.RSUs Vesting Acceleration.

(a)In the event of the Employment’s termination due to Participant’s death or Disability (defined below), then all of the Time-Based RSUs that have not become vested as of the date of the death or the Termination Date (defined below) due to Participant’s Disability, as applicable, shall become fully vested as of the Termination Date conditioned on the Participant, if legally capable at such time, or his estate, beneficiaries or legal representatives, if Participant is deceased or legally incapable at such time, executing a general release of claims related to or arising from Participant’s Employment, in a form acceptable to the Company.

(b)In the event the Employment is terminated for any other reason, including without limitation by the Company with or without cause or due to the Participant’s resignation, then all RSUs that have not become vested as of the Termination Date shall automatically be forfeited.

(c)For purposes of this Agreement:

“Disability” has the following meaning: the Participant’s inability to perform the Employment by reason of any medically determinable physical or mental impairment for a period of 6 months or more in any 12-month period.

“Termination Date” is the date the Participant’s Employment is terminated under the circumstances set forth in (a) or (b) above.

5.Dividend Equivalents. If the Company pays an ordinary cash dividend on its outstanding Common Stock at any time between the Date of Grant and the Settlement Date (as defined in Section 6 below) -- provided that the date on which stockholders of record are determined for purposes of paying a cash dividend on issued and outstanding shares of the Common Stock falls after the Date of Grant -- the Participant shall receive on the Settlement Date or at the next payroll payment (but in no event more than 75 days after the Vesting Date) either: (a) a number of Shares (as defined in Section 6 below) having a Fair Market Value (as defined below) on the Vesting Date equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date; or (b) a lump sum cash payment equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date ((a) or (b) as applicable, the “Dividend Payment”); provided, however, that in the case of (a), any partial Share resulting from the calculation will be paid in cash.

For purposes of this Agreement, “Fair Market Value” means the closing price of the Company’s Common Stock at the close of business of the applicable date.

6.Settlement. Within 75 days following the day any RSUs are vested in accordance with the terms and conditions of this Agreement (the “Settlement Date”), the Company shall (a) issue and deliver to the Participant one share of Common Stock for each vested RSU (the “Shares”) and enter the Participant’s name as a shareholder of record or beneficial owner with respect to the Shares on the books of the Company; and (b) calculate the Dividend Payment. The Participant agrees that the Company may deduct from the Dividend Payment any amounts owed by the Participant to the Company with respect to any whole Share issued by the Company to the Participant to cover any partial Share resulting from the settlement process.

7.Restrictive Covenants.

(a)The Participant hereby acknowledges that he or she is familiar with the Confidential Information (defined below) of the Company and its Affiliates and Subsidiaries. The Participant acknowledges and agrees that the Company would be irreparably damaged if the Participant were to provide services to any person competing with the Company or any of its Affiliates or Subsidiaries or engaged in a Similar Business (defined below) and that such competition by the Participant would result in a significant loss of goodwill by the Company. Therefore, the Participant agrees that the following are reasonable restrictions:

1.Similar Business: In consideration of the Award, during the Employment and for a term of 12 months immediately after the Termination Date, the Participant shall not, directly or indirectly, Engage in Similar Business services or activities within a 10-mile perimeter of where the Company is engaged in business in Puerto Rico and within that same perimeter in any other country with respect to which the Participant performed his duties on a regular basis as an employee for the Company, during the 12 consecutive month period ending on the Termination Date; provided, that nothing herein shall prohibit the Participant from being a passive owner of not more than 5% of the

2

outstanding stock of any class of a corporation which is publicly traded so long as the Participant has no active participation in the business of such corporation.

(b)In consideration of the Award, during the Employment and ending 12 months after the Termination Date, the Participant shall not directly, or indirectly through another person, (i) induce or attempt to induce any employee, representative, agent or consultant of the Company or any of its Affiliates or Subsidiaries to leave the employ or services of the Company or any of its Affiliates or Subsidiaries, or in any way interfere with the relationship between the Company or any of its Affiliates or Subsidiaries and any employee, representative, agent or consultant thereof; or (ii) hire any person who was an employee, representative, agent or consultant of the Company or any of its Affiliates or Subsidiaries at any time during the 12 month period immediately prior to the date on which such hiring would take place. No action by another person or entity shall be deemed to be a breach of this provision unless the Participant directly or indirectly assisted, encouraged, or otherwise counseled such person or entity to engage in such activity.

(c)For purposes of this Section 7:

1.“Engage” means participate in, consult with, be employed by, or assist with the organization, policy making, ownership, financing, management, operation, or control of any Similar Business in any capacity in which, in the absence of this Agreement, Confidential Information, inventions, Trade Secrets of the Company or Goodwill would reasonably be considered useful.

2.“Similar Business” shall mean the same business of providing full-service transaction processing, including merchant acquiring, payment services and business process management services, to the extent such activity or activities were actually performed or engaged in by, for, or on behalf of, the Company or any of its subsidiaries or affiliates during the employment period.

3.“Confidential Information” means information that is not generally known to the public (but for purposes of clarity, Confidential Information shall never exclude any such information that becomes known to the public because of Participant’s unauthorized disclosure) and that is used, developed or obtained by the Company in connection with its business, including, but not limited to, information, observations and data obtained by the Participant during the Employment concerning (A) the business or affairs of the Company, its Affiliates or Subsidiaries; (B) products or services; (C) fees, costs and pricing structures; (D) designs; (E) analyses; (F) drawings, photographs and reports; (G) computer software, including operating systems, applications and program listings; (H) flow charts, manuals and documentation; (I) databases; (J) accounting and business methods; (K) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice; (L) customers and Clients and customer or Client lists; (M) other copyrightable works; (N) all production methods, processes, technology and trade secrets; and (O) all similar and related information in whatever form. Confidential Information will not include any information that has been published in a form generally available to the public (except as a result of Participant’s unauthorized disclosure or any third party’s unauthorized disclosure resulting from any direct or indirect influence by Participant) prior to the date Participant proposes to disclose or use such information. Confidential Information will not be deemed to have been published or otherwise disclosed merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

3

8.Taxes. Unless otherwise required by applicable law, on the Settlement Date, (a) the Shares and the Dividend Payment will be considered ordinary income for tax purposes and subject to all applicable payroll taxes; (b) the Company shall report such income to the appropriate taxing authorities as it determines to be necessary and appropriate; (c) the Participant shall be responsible for payment of any taxes due in respect of the Shares and the Dividend Payment; and (d) the Company shall withhold taxes in respect of the Shares and the Dividend Payment (a “Tax Payment”). In order to satisfy the Participant’s obligation to pay the Tax Payment, the Company will withhold from any Shares otherwise to be delivered to the Participant, a number of whole shares of Common Stock having a Fair Market Value equal to the Tax Payment (i.e., a “cashless exercise”); provided, however, that the Participant may elect to satisfy his or her obligation to pay the Tax Payment through a non-cashless exercise, by notifying the Company within at least 5 business days before the Settlement Date. If the Participant does not provide such notification within the established timeframe, the Company will proceed with the default method of the cashless exercise. If the Participant fails to pay any required Tax Payment, the Company may, in its discretion, deduct any Tax Payments from any amount then or thereafter payable by the Company to the Participant and take such other action as deemed necessary to satisfy all obligations for the Tax Payment (including reducing the number of Shares delivered on the Settlement Date). The Participant agrees to pay the Company in the form of a check or cashier’s check any overage of the Tax Payment paid by the Company as a result of making whole any partial Share issued through a cashless exercise. Furthermore, the Participant acknowledges and agrees that the Participant will be solely responsible for making any Tax Payment directly to the appropriate taxing authorities should the Participant opt not to satisfy his or her Tax Payment through a cashless exercise.

9.Rights as Stockholder. Upon and following the Settlement Date (but not before), the Participant shall be the record or beneficial owner of the Shares unless and until such Shares are sold or otherwise disposed of, and, if a record owner, shall be entitled to all rights of a stockholder of the Company (including voting rights).

10.Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the Commonwealth of Puerto Rico applicable to contracts to be performed therein. The Participant expressly consents that any action or proceeding relating to the Plan will be heard without a jury. No action relating to the Plan may be brought later than the first anniversary of earlier of termination of employment or other event giving rise to the claim.

11.Notice. Every notice or other communication relating to this Agreement shall be made in writing and the notice, request or other communication shall be deemed to be received upon receipt by the party entitled thereto. Any notice, request or other communication by the Participant should be delivered to the Company’s Chief Legal Officer.

12.Miscellaneous. This Agreement and the Plan contain the entire agreement between the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations, and negotiations in respect thereto. No change, modification, or waiver of any provision of this Agreement shall be valid unless in writing and signed by the parties hereto. This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Participant, acquire any rights hereunder in accordance with this Agreement or the Plan. The terms and provisions of the Plan and the Vesting Schedule are incorporated herein by reference, and the Participant hereby acknowledges receiving a copy of the Plan. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.

By clicking “I Accept” below, the Participant is hereby agreeing to the terms and conditions of this Agreement as of the Date of Grant set forth above, and that he or she has read the same, including the Vesting Schedule.

4

Exhibit A - Vesting Schedule

Number of Time-Based RSUs to vest	Vesting Date
[*]	02/28/2025
[*]	02/28/2026
[*]	02/28/2027

5

EX-10.3

EXHIBIT 10.3

EVERTEC, INC.

2022 INCENTIVE AWARD PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (together with the Vesting Schedule (defined below), this “Agreement”) is made as of this 24th day of February, 2023 (the “Date of Grant”), by and between EVERTEC, Inc. (the “Company”) and you (the “Participant”). Defined terms used but not otherwise defined herein will have the meanings attributed to them in the Plan (defined below).

W I T N E S S E T H

WHEREAS, the Company maintains the EVERTEC, Inc. 2022 Incentive Award Plan (the “Plan”);

WHEREAS, in connection with the Participant’s service as an employee of the Company or any of its affiliates and Subsidiaries (the “Employment”), the Company desires to grant Restricted Stock Units (“RSUs”) to the Participant (the “Award”), subject to the terms and conditions of the Plan and this Agreement; and

WHEREAS, such RSUs will be time-based RSUs (“Time-Based RSUs”), which vest on a future specified date or dates, as specified in Exhibit A.

NOW, THEREFORE, in consideration of the covenants and agreements contained herein and for other good and valuable consideration, the parties agree as follows:

1.Grant of RSUs. In consideration of the Employment, the Company will grant to the Participant the number of RSUs set forth in the vesting schedule included herein as Exhibit A (the “Vesting Schedule”). Each RSU represents the unfunded and unsecured promise of the Company to deliver to the Participant one share of common stock, par value $.01 per share, of the Company (the “Common Stock”) on the Settlement Date (as defined in Section 6 hereof).

2.Purchase Price. The purchase price of the RSUs shall be deemed to be zero U.S. Dollars ($0) per share.

3.Vesting. The RSUs shall vest and become non-forfeitable on the dates established in the Vesting Schedule (each such date, a “Vesting Date”), provided that the Participant is actively carrying out his or her duties in connection with the Employment at all times from the Date of Grant through each respective Vesting Date.

4.RSUs Vesting Acceleration.

(a)In the event of the Employment’s termination due to Participant’s death or Disability (defined below), then all of the Time-Based RSUs that have not become vested as of the date of the death or the Termination Date (defined below) due to Participant’s Disability, as applicable, shall become fully vested as of the Termination Date conditioned on the Participant, if legally capable at such time, or his estate, beneficiaries or legal representatives, if Participant is deceased or legally incapable at such time, executing a general release of claims related to or arising from Participant’s Employment, in a form acceptable to the Company.

(b)In the event the Employment is terminated for any other reason, including without limitation by the Company with or without cause or due to the Participant’s resignation, then all RSUs that have not become vested as of the Termination Date shall automatically be forfeited.

(c)For purposes of this Section 4:

“Disability” has the following meaning: the Participant’s inability to perform the Employment by reason of any medically determinable physical or mental impairment for a period of 6 months or more in any 12-month period.

“Termination Date” is the date the Participant’s Employment is terminated under the circumstances set forth in (a) or (b) above.

5.Dividend Equivalents. If the Company pays an ordinary cash dividend on its outstanding Common Stock at any time between the Date of Grant and the Settlement Date (as defined in Section 6 below)–provided that the date on which stockholders of record are determined for purposes of paying a cash dividend on issued and outstanding shares of the Common Stock falls after the Date of Grant–the Participant shall receive on the Settlement Date or at the next payroll payment (but in no event more than 75 days after the Vesting Date) either: (a) a number of Shares (as defined in Section 6 below) having a Fair Market Value (as defined below) on the Vesting Date equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date; or (b) a lump sum cash payment equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date ((a) or (b) as applicable, the “Dividend Payment”); provided, however, that in the case of (a), any partial Share resulting from the calculation will be paid in cash.

For purposes of this Agreement, “Fair Market Value” means the closing price of the Company’s Common Stock at the close of business of the applicable date.

6.Settlement. Within 75 days following the day any RSUs are vested in accordance with the terms and conditions of this Agreement (the “Settlement Date”), the Company shall (a) issue and deliver to the Participant one share of Common Stock for each vested RSU (the “Shares”) and enter the Participant’s name as a shareholder of record or beneficial owner with respect to the Shares on the books of the Company; and (b) calculate the Dividend Payment. The Participant agrees that the Company may deduct from the Dividend Payment any amounts owed by the Participant to the Company with respect to any whole Share issued by the Company to the Participant to cover any partial Share resulting from the settlement process.

7.Restrictive Covenants.

(a)The Participant hereby acknowledges that he or she is familiar with the Confidential Information (defined below) of the Company and its affiliates and Subsidiaries. The Participant acknowledges and agrees that the Company would be irreparably damaged if the Participant were to provide services to any person competing with the Company or any of its affiliates or Subsidiaries or engaged in a Similar Business (defined below) and that such competition by the Participant would result in a significant loss of goodwill by the Company. Therefore, the Participant agrees that the following are reasonable restrictions:

1.Similar Business: In consideration of the Award, during the Employment and for a term of 12 months immediately after the Termination Date, the Participant shall not, directly or indirectly, Engage in Similar Business services or activities within a 10-mile perimeter of where the Company is engaged in business in Puerto Rico and within that same perimeter in any other country with respect to which the Participant performed his duties on a regular basis as an employee for the Company, during the 12 consecutive month period ending on the Termination Date; provided, that nothing herein shall prohibit the Participant from being a passive owner of not more than 5% of the

2

outstanding stock of any class of a corporation which is publicly traded so long as the Participant has no active participation in the business of such corporation.

(b)In consideration of the Award, during the Employment and ending 12 months after the Termination Date, the Participant shall not directly, or indirectly through another person, (i) induce or attempt to induce any employee, representative, agent or consultant of the Company or any of its affiliates or Subsidiaries to leave the employ or services of the Company or any of its affiliates or Subsidiaries, or in any way interfere with the relationship between the Company or any of its affiliates or Subsidiaries and any employee, representative, agent or consultant thereof; or (ii) hire any person who was an employee, representative, agent or consultant of the Company or any of its affiliates or Subsidiaries at any time during the 12 month period immediately prior to the date on which such hiring would take place. No action by another person or entity shall be deemed to be a breach of this provision unless the Participant directly or indirectly assisted, encouraged or otherwise counseled such person or entity to engage in such activity.

(c)For purposes of this Section 7:

1.“Engage” means participate in, consult with, be employed by, or assist with the organization, policy making, ownership, financing, management, operation or control of any Similar Business in any capacity in which, in the absence of this Agreement, Confidential Information, inventions, trade secrets of the Company or goodwill would reasonably be considered useful.

2.“Similar Business” shall mean the same business of providing full service transaction processing, including merchant acquiring, payment services and business process management services, to the extent such activity or activities were actually performed or engaged in by, for, or on behalf of, the Company or any of its subsidiaries or affiliates during the Employment period.

3.“Confidential Information” means information that is not generally known to the public (but for purposes of clarity, Confidential Information shall never exclude any such information that becomes known to the public because of Participant’s unauthorized disclosure) and that is used, developed or obtained by the Company in connection with its business, including, but not limited to, information, observations and data obtained by the Participant during the Employment concerning (A) the business or affairs of the Company, its affiliates or Subsidiaries; (B) products or services; (C) fees, costs and pricing structures; (D) designs; (E) analyses; (F) drawings, photographs and reports; (G) computer software, including operating systems, applications and program listings; (H) flow charts, manuals and documentation; (I) databases; (J) accounting and business methods; (K) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice; (L) customers and clients and customer or client lists; (M) other copyrightable works; (N) all production methods, processes, technology and trade secrets; and (O) all similar and related information in whatever form. Confidential Information will not include any information that has been published in a form generally available to the public (except as a result of Participant’s unauthorized disclosure or any third party’s unauthorized disclosure resulting from any direct or indirect influence by Participant) prior to the date Participant proposes to disclose or use such information. Confidential Information will not be deemed to have been published or otherwise disclosed merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

3

8.Taxes. Unless otherwise required by applicable law, on the Settlement Date, (a) the Shares and the Dividend Payment will be considered ordinary income for tax purposes and subject to all applicable payroll taxes; (b) the Company shall report such income to the appropriate taxing authorities as it determines to be necessary and appropriate; (c) the Participant shall be responsible for payment of any taxes due in respect of the Shares and the Dividend Payment; and (d) the Company shall withhold taxes in respect of the Shares and the Dividend Payment (a “Tax Payment”). In order to satisfy the Participant’s obligation to pay the Tax Payment, the Company will withhold from any Shares otherwise to be delivered to the Participant, a number of whole shares of Common Stock having a Fair Market Value equal to the Tax Payment (i.e., a “cashless exercise”); provided, however, that the Participant may elect to satisfy his or her obligation to pay the Tax Payment through a non-cashless exercise, by notifying the Company within at least 5 business days before the Settlement Date. If the Participant does not provide such notification within the established timeframe, the Company will proceed with the default method of the cashless exercise. If the Participant fails to pay any required Tax Payment, the Company may, in its discretion, deduct any Tax Payments from any amount then or thereafter payable by the Company to the Participant and take such other action as deemed necessary to satisfy all obligations for the Tax Payment (including reducing the number of Shares delivered on the Settlement Date). The Participant agrees to pay the Company in the form of a check or cashier’s check any overage of the Tax Payment paid by the Company as a result of making whole any partial Share issued through a cashless exercise. Furthermore, the Participant acknowledges and agrees that the Participant will be solely responsible for making any Tax Payment directly to the appropriate taxing authorities should the Participant opt not to satisfy his or her Tax Payment through a cashless exercise.

9.Rights as Stockholder. Upon and following the Settlement Date (but not before), the Participant shall be the record or beneficial owner of the Shares unless and until such Shares are sold or otherwise disposed of, and, if a record owner, shall be entitled to all rights of a stockholder of the Company (including voting rights).

10.Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the Commonwealth of Puerto Rico applicable to contracts to be performed therein. The Participant expressly consents that any action or proceeding relating to the Plan will be heard without a jury. No action relating to the Plan may be brought later than the first anniversary of earlier of termination of Employment or other event giving rise to the claim.

11.Notice. Every notice or other communication relating to this Agreement shall be made in writing and the notice, request or other communication shall be deemed to be received upon receipt by the party entitled thereto. Any notice, request or other communication by the Participant should be delivered to the Company’s Chief Legal Officer.

12.Miscellaneous. This Agreement and the Plan contain the entire agreement between the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto. No change, modification or waiver of any provision of this Agreement shall be valid unless in writing and signed by the parties hereto. This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Participant, acquire any rights hereunder in accordance with this Agreement or the Plan. The terms and provisions of the Plan and the Vesting Schedule are incorporated herein by reference, and the Participant hereby acknowledges receiving a copy of the Plan. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.

By clicking “I Accept” below, the Participant is hereby agreeing to the terms and conditions of this Agreement as of the Date of Grant set forth above, and that he or she has read the same, including the Vesting Schedule.

4

Exhibit A - Vesting Schedule

Number of Time-Based RSUs to vest	Vesting Date
[*]	02/24/2024
[*]	02/24/2025
[*]	02/24/2026

5

EX-10.4

EXHIBIT 10.4

EVERTEC, INC.

2013 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (together with the Vesting Schedule (defined below), this “Agreement”) is made as of this 25th day of February, 2022 (the “Date of Grant”), by and between EVERTEC, Inc. (the “Company”) and you (the “Participant”). Defined terms used but not otherwise defined herein will have the meanings attributed to them in the Plan (defined below).

W I T N E S S E T H

WHEREAS, the Company maintains the EVERTEC, Inc. 2013 Equity Incentive Plan (the “Plan”);

WHEREAS, in connection with the Participant’s service as an employee of the Company or any of its Affiliates and Subsidiaries (the “Employment”), the Company desires to grant Restricted Stock Units (“RSUs”) to the Participant (the “Award”), subject to the terms and conditions of the Plan and this Agreement; and

WHEREAS, such RSUs will be time-based RSUs (“Time-Based RSUs”), which vest on a future specified date or dates, as specified in Exhibit A.

NOW, THEREFORE, in consideration of the covenants and agreements contained herein and for other good and valuable consideration, the parties agree as follows:

1.Grant of RSUs. In consideration of the Employment, the Company will grant to the Participant the number of RSUs set forth in the vesting schedule included herein as Exhibit A (the “Vesting Schedule”). Each RSU represents the unfunded and unsecured promise of the Company to deliver to the Participant one share of common stock, par value $.01 per share, of the Company (the “Common Stock”) on the Settlement Date (as defined in Section 6 hereof).

2.Purchase Price. The purchase price of the RSUs shall be deemed to be zero U.S. Dollars ($0) per share.

3.Vesting. The RSUs shall vest and become non-forfeitable on the dates established in the Vesting Schedule (each such date, a “Vesting Date”), provided that the Participant is actively carrying out his or her duties in connection with the Employment at all times from the Date of Grant through each respective Vesting Date.

4.RSUs Vesting Acceleration.

(a)In the event of the Employment’s termination due to Participant’s death or Disability (defined below), then all of the Time-Based RSUs that have not become vested as of the date of the death or the Termination Date (defined below) due to Participant’s Disability, as applicable, shall become fully vested as of the Termination Date conditioned on the Participant, if legally capable at such time, or his estate, beneficiaries or legal representatives, if Participant is deceased or legally incapable at such time, executing a general release of claims related to or arising from Participant’s Employment, in a form acceptable to the Company.

(b)In the event the Employment is terminated for any other reason, including without limitation by the Company with or without cause or due to the Participant’s resignation, then all RSUs that have not become vested as of the Termination Date shall automatically be forfeited.

(c)For purposes of this Section 4:

“Disability” has the following meaning: the Participant’s inability to perform the Employment by reason of any medically determinable physical or mental impairment for a period of 6 months or more in any 12-month period.

“Termination Date” is the date the Participant’s Employment is terminated under the circumstances set forth in (a) or (b) above.

5.Dividend Equivalents. If the Company pays an ordinary cash dividend on its outstanding Common Stock at any time between the Date of Grant and the Settlement Date (as defined in Section 6 below) -- provided that the date on which stockholders of record are determined for purposes of paying a cash dividend on issued and outstanding shares of the Common Stock falls after the Date of Grant -- the Participant shall receive on the Settlement Date or at the next payroll payment (but in no event more than 75 days after the Vesting Date) either: (a) a number of Shares (as defined in Section 6 below) having a Fair Market Value (as defined below) on the Vesting Date equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date; or (b) a lump sum cash payment equal to the aggregate amount of the cash dividends paid by the Company on a single share of the Common Stock, multiplied by the number of RSUs that are settled on the Settlement Date ((a) or (b) as applicable, the “Dividend Payment”); provided, however, that in the case of (a), any partial Share resulting from the calculation will be paid in cash.

For purposes of this Agreement, “Fair Market Value” means the closing price of the Company’s Common Stock at the close of business of the applicable date.

6.Settlement. Within 75 days following the day any RSUs are vested in accordance with the terms and conditions of this Agreement (the “Settlement Date”), the Company shall (a) issue and deliver to the Participant one share of Common Stock for each vested RSU (the “Shares”) and enter the Participant’s name as a shareholder of record or beneficial owner with respect to the Shares on the books of the Company; and (b) calculate the Dividend Payment. The Participant agrees that the Company may deduct from the Dividend Payment any amounts owed by the Participant to the Company with respect to any whole Share issued by the Company to the Participant to cover any partial Share resulting from the settlement process.

7.Restrictive Covenants.

(a)The Participant hereby acknowledges that he or she is familiar with the Confidential Information (defined below) of the Company and its Affiliates and Subsidiaries. The Participant acknowledges and agrees that the Company would be irreparably damaged if the Participant were to provide services to any person competing with the Company or any of its Affiliates or Subsidiaries or engaged in a Similar Business (defined below) and that such competition by the Participant would result in a significant loss of goodwill by the Company. Therefore, the Participant agrees that the following are reasonable restrictions:

1.Similar Business: In consideration of the Award, during the Employment and for a term of 12 months immediately after the Termination Date, the Participant shall not, directly or indirectly, Engage in Similar Business services or activities within a 10-mile perimeter of where the Company is engaged in business in Puerto Rico and within that same perimeter in any other country with respect to which the Participant performed his duties on a regular basis as an employee for the Company, during the 12 consecutive month period ending on the Termination Date; provided, that nothing herein shall prohibit the Participant from being a passive owner of not more than 5% of the

2

outstanding stock of any class of a corporation which is publicly traded so long as the Participant has no active participation in the business of such corporation.

(b)In consideration of the Award, during the Employment and ending 12 months after the Termination Date, the Participant shall not directly, or indirectly through another person, (i) induce or attempt to induce any employee, representative, agent or consultant of the Company or any of its Affiliates or Subsidiaries to leave the employ or services of the Company or any of its Affiliates or Subsidiaries, or in any way interfere with the relationship between the Company or any of its Affiliates or Subsidiaries and any employee, representative, agent or consultant thereof; or (ii) hire any person who was an employee, representative, agent or consultant of the Company or any of its Affiliates or Subsidiaries at any time during the 12 month period immediately prior to the date on which such hiring would take place. No action by another person or entity shall be deemed to be a breach of this provision unless the Participant directly or indirectly assisted, encouraged or otherwise counseled such person or entity to engage in such activity.

(c)For purposes of this Section 7:

1.“Engage” means participate in, consult with, be employed by, or assist with the organization, policy making, ownership, financing, management, operation or control of any Similar Business in any capacity in which, in the absence of this Agreement, Confidential Information, inventions, Trade Secrets of the Company or Goodwill would reasonably be considered useful.

2.“Similar Business” shall mean the same business of providing full service transaction processing, including merchant acquiring, payment services and business process management services, to the extent such activity or activities were actually performed or engaged in by, for, or on behalf of, the Company or any of its subsidiaries or affiliates during the employment period.

3.“Confidential Information” means information that is not generally known to the public (but for purposes of clarity, Confidential Information shall never exclude any such information that becomes known to the public because of Participant’s unauthorized disclosure) and that is used, developed or obtained by the Company in connection with its business, including, but not limited to, information, observations and data obtained by the Participant during the Employment concerning (A) the business or affairs of the Company, its Affiliates or Subsidiaries; (B) products or services; (C) fees, costs and pricing structures; (D) designs; (E) analyses; (F) drawings, photographs and reports; (G) computer software, including operating systems, applications and program listings; (H) flow charts, manuals and documentation; (I) databases; (J) accounting and business methods; (K) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice; (L) customers and Clients and customer or Client lists; (M) other copyrightable works; (N) all production methods, processes, technology and trade secrets; and (O) all similar and related information in whatever form. Confidential Information will not include any information that has been published in a form generally available to the public (except as a result of Participant’s unauthorized disclosure or any third party’s unauthorized disclosure resulting from any direct or indirect influence by Participant) prior to the date Participant proposes to disclose or use such information. Confidential Information will not be deemed to have been published or otherwise disclosed merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

3

8.Taxes. Unless otherwise required by applicable law, on the Settlement Date, (a) the Shares and the Dividend Payment will be considered ordinary income for tax purposes and subject to all applicable payroll taxes; (b) the Company shall report such income to the appropriate taxing authorities as it determines to be necessary and appropriate; (c) the Participant shall be responsible for payment of any taxes due in respect of the Shares and the Dividend Payment; and (d) the Company shall withhold taxes in respect of the Shares and the Dividend Payment (a “Tax Payment”). In order to satisfy the Participant’s obligation to pay the Tax Payment, the Company will withhold from any Shares otherwise to be delivered to the Participant, a number of whole shares of Common Stock having a Fair Market Value equal to the Tax Payment (i.e., a “cashless exercise”); provided, however, that the Participant may elect to satisfy his or her obligation to pay the Tax Payment through a non-cashless exercise, by notifying the Company within at least 5 business days before the Settlement Date. If the Participant does not provide such notification within the established timeframe, the Company will proceed with the default method of the cashless exercise. If the Participant fails to pay any required Tax Payment, the Company may, in its discretion, deduct any Tax Payments from any amount then or thereafter payable by the Company to the Participant and take such other action as deemed necessary to satisfy all obligations for the Tax Payment (including reducing the number of Shares delivered on the Settlement Date). The Participant agrees to pay the Company in the form of a check or cashier’s check any overage of the Tax Payment paid by the Company as a result of making whole any partial Share issued through a cashless exercise. Furthermore, the Participant acknowledges and agrees that the Participant will be solely responsible for making any Tax Payment directly to the appropriate taxing authorities should the Participant opt not to satisfy his or her Tax Payment through a cashless exercise.

9.Rights as Stockholder. Upon and following the Settlement Date (but not before), the Participant shall be the record or beneficial owner of the Shares unless and until such Shares are sold or otherwise disposed of, and, if a record owner, shall be entitled to all rights of a stockholder of the Company (including voting rights).

10.Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the Commonwealth of Puerto Rico applicable to contracts to be performed therein. The Participant expressly consent that any action or proceeding relating to the Plan will be heard without a jury. No action relating to the Plan may be brought later than the first anniversary of earlier of termination of employment or other event giving rise to the claim.

11.Notice. Every notice or other communication relating to this Agreement shall be made in writing and the notice, request or other communication shall be deemed to be received upon receipt by the party entitled thereto. Any notice, request or other communication by the Participant should be delivered to the Company’s Chief Legal Officer.

12.Miscellaneous. This Agreement and the Plan contain the entire agreement between the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations in respect thereto. No change, modification or waiver of any provision of this Agreement shall be valid unless in writing and signed by the parties hereto. This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Participant, acquire any rights hereunder in accordance with this Agreement or the Plan. The terms and provisions of the Plan and the Vesting Schedule are incorporated herein by reference, and the Participant hereby acknowledges receiving a copy of the Plan. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.

By clicking “I Accept” below, the Participant is hereby agreeing to the terms and conditions of this Agreement as of the Date of Grant set forth above, and that he or she has read the same, including the Vesting Schedule.

4

Exhibit A - Vesting Schedule

Number of Time-Based RSUs to vest	Vesting Date
[*]	02/25/2023
[*]	02/25/2024
[*]	02/25/2025

5

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

I, Morgan Schuessler, certify that:

1.I have reviewed this report on Form 10-Q of EVERTEC, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 2, 2024	/s/ Morgan Schuessler
	Morgan Schuessler
	Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a)

I, Joaquin A. Castrillo-Salgado, certify that:

1.I have reviewed this report on Form 10-Q of EVERTEC, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 2, 2024	/s/ Joaquin A. Castrillo-Salgado
	Joaquin A. Castrillo-Salgado
	Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Certification Pursuant to 18 U.S.C. Section 1350

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002 , the undersigned officer of EVERTEC, Inc. (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 2, 2024	/s/ Morgan Schuessler
	Morgan Schuessler
	Chief Executive Officer

EX-32.2

EXHIBIT 32.2

Certification Pursuant to 18 U.S.C. 1350

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of EVERTEC, Inc. (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 2, 2024	/s/ Joaquin A. Castrillo-Salgado
	Joaquin A. Castrillo-Salgado
	Chief Financial Officer

XML

Cover - shares	3 Months Ended
	Mar. 31, 2024	Apr. 25, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-35872
Entity Registrant Name	EVERTEC, Inc.
Entity Incorporation, State or Country Code	PR
Entity Tax Identification Number	66-0783622
Entity Address, Address Line One	Cupey Center Building,
Entity Address, Address Line Two	Road 176, Kilometer 1.3,
Entity Address, City or Town	San Juan,
Entity Address, State or Province	PR
Entity Address, Postal Zip Code	00926
City Area Code	787
Local Phone Number	759-9999
Title of 12(b) Security	Common Stock, $0.01 par value per share
Trading Symbol	EVTC
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		64,409,434
Entity Central Index Key	0001559865
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current Assets:
Cash and cash equivalents	$ 293,666	$ 295,600
Restricted cash	23,597	23,073
Accounts receivable, net	141,332	126,510
Settlement assets	42,068	51,467
Prepaid expenses and other assets	62,336	64,704
Total current assets	562,999	561,354
Debt securities available-for-sale, at fair value	2,093	2,095
Equity securities, at fair value	10,843	9,413
Investment in equity investees	21,859	21,145
Property and equipment, net	60,777	62,453
Operating lease right-of-use asset	14,824	14,796
Goodwill	777,932	791,700
Other intangible assets, net	490,188	518,070
Deferred tax asset	19,879	47,847
Derivative asset	6,962	4,385
Other long-term assets	28,130	27,005
Total assets	1,996,486	2,060,263
Current Liabilities:
Accrued liabilities	116,977	129,160
Accounts payable	66,629	66,516
Contract liability	18,938	21,055
Income tax payable	0	3,402
Current portion of long-term debt	23,867	23,867
Short-term borrowings	80,000	0
Current portion of operating lease liability	7,575	6,693
Settlement liabilities	40,446	47,620
Total current liabilities	354,432	298,313
Long-term debt	941,717	946,816
Deferred tax liability	53,576	87,916
Contract liability - long term	52,062	41,825
Operating lease liability - long-term	8,686	9,033
Other long-term liabilities	34,116	40,984
Total liabilities	1,444,589	1,424,887
Commitments and contingencies (Note 14)
Redeemable non-controlling interests	40,658	36,968
Stockholders’ equity
Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued	0	0
Common stock, par value $0.01; 206,000,000 shares authorized; 64,408,959 shares issued and outstanding as of March 31, 2024 (December 31, 2023 - 65,450,799)	644	654
Additional paid-in capital	0	36,527
Accumulated earnings	512,535	538,903
Accumulated other comprehensive (loss) income, net of tax	(5,922)	18,209
Total stockholders’ equity	507,257	594,293
Non-redeemable non-controlling interest	3,982	4,115
Total equity	511,239	598,408
Total liabilities and equity	$ 1,996,486	$ 2,060,263

XML

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock authorized (in shares)	2,000,000	2,000,000
Preferred stock issued (in shares)	0	0
Common stock par value (in usd per share)	$ 0.01	$ 0.01
Common stock authorized (in shares)	206,000,000	206,000,000
Common stock issued (in shares)	64,408,959	65,450,799
Common stock outstanding (in shares)	64,408,959	65,450,799

XML

Unaudited Condensed Consolidated Statements of Income and Comprehensive (Loss) Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
Revenues	$ 205,318	$ 159,814
Operating costs and expenses
Cost of revenues, exclusive of depreciation and amortization	102,448	76,417
Selling, general and administrative expenses	35,626	23,875
Depreciation and amortization	34,441	19,432
Total operating costs and expenses	172,515	119,724
Income from operations	32,803	40,090
Non-operating income (expenses)
Interest income	3,360	1,133
Interest expense	(19,939)	(5,643)
Loss on foreign currency remeasurement	(4,456)	(4,864)
Earnings from equity method investments	1,071	1,155
Other income, net	3,840	1,010
Total non-operating expenses	(16,124)	(7,209)
Income before income taxes	16,679	32,881
Income tax expense	292	2,818
Net income	16,387	30,063
Less: Net income attributable to non-controlling interest	408	11
Net income attributable to EVERTEC, Inc.’s common stockholders	15,979	30,052
Other comprehensive (loss) income, net of tax of $157 and $(116)
Foreign currency translation adjustments	(26,476)	17,605
Gain (loss) on cash flow hedges	2,348	(1,545)
Unrealized loss on change in fair value of debt securities available-for-sale	(3)	(20)
Other comprehensive (loss) income, net of tax	(24,131)	16,040
Total comprehensive (loss) income attributable to EVERTEC, Inc.’s common stockholders	$ (8,152)	$ 46,092
Net income per common share - basic attributable to EVERTEC, Inc.’s common stockholders (in usd per share)	$ 0.25	$ 0.46
Net income per common share - diluted attributable to EVERTEC, Inc.’s common stockholders (in usd per share)	$ 0.24	$ 0.46

XML

Unaudited Condensed Consolidated Statements of Income and Comprehensive (Loss) Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
Other comprehensive income (loss), tax	$ 157	$ (116)

XML

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Earnings	Accumulated  Other Comprehensive Income (Loss)	Non-Redeemable Non-Controlling Interest
Beginning balance (in shares) at Dec. 31, 2022		64,847,233
Beginning balance at Dec. 31, 2022	$ 474,748	$ 648	$ 0	$ 487,349	$ (16,486)	$ 3,237
Changes in Stockholders’ Equity
Share-based compensation recognized	5,557		5,557
Repurchase of common stock (in shares)		(187,976)
Repurchase of common stock	(6,269)	$ (1)		(6,268)
Restricted stock units delivered (in shares)		419,205
Restricted stock units delivered	(5,874)	$ 4	(5,557)	(321)
Net income	30,063			30,052		11
Cash dividends declared on common stock, $0.05 per share	(3,249)			(3,249)
Other comprehensive (loss) income	16,165				16,040	125
Ending balance (in shares) at Mar. 31, 2023		65,078,462
Ending balance at Mar. 31, 2023	$ 511,141	$ 651	0	507,563	(446)	3,373
Beginning balance (in shares) at Dec. 31, 2023	65,450,799	65,450,799
Beginning balance at Dec. 31, 2023	$ 598,408	$ 654	36,527	538,903	18,209	4,115
Changes in Stockholders’ Equity
Share-based compensation recognized	7,349		7,349
Repurchase of common stock (in shares)		(1,516,793)
Repurchase of common stock	(70,000)	$ (15)	(30,943)	(39,042)
Restricted stock units delivered (in shares)		474,953
Restricted stock units delivered	(9,756)	$ 5	(9,761)
Net income	16,387			16,497		(110)
Cash dividends declared on common stock, $0.05 per share	(3,273)			(3,273)
Adjustment of redeemable noncontrolling interest to redemption value	(3,172)		(3,172)
Excise tax on repurchase of common stock	(550)			(550)
Other comprehensive (loss) income	$ (24,154)				(24,131)	(23)
Ending balance (in shares) at Mar. 31, 2024	64,408,959	64,408,959
Ending balance at Mar. 31, 2024	$ 511,239	$ 644	$ 0	$ 512,535	$ (5,922)	$ 3,982

XML

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity (Parenthetical) - $ / shares		3 Months Ended
	Feb. 15, 2024	Mar. 31, 2024	Mar. 31, 2023
Statement of Stockholders' Equity [Abstract]
Cash dividends declared (in usd per share)	$ 0.05	$ 0.05	$ 0.05

XML

Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities
Net income	$ 16,387	$ 30,063
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	34,441	19,432
Amortization of debt issue costs and accretion of discount	1,874	396
Operating lease amortization	1,810	1,626
Unrealized gain on change in fair value of equity securities	(2,325)	0
Deferred tax benefit	(5,720)	(2,208)
Share-based compensation	7,349	5,557
Earnings of equity method investment	(1,071)	(1,155)
Loss on foreign currency remeasurement	4,456	4,864
Other, net	797	2,530
Decrease (increase) in assets:
Accounts receivable, net	(14,756)	10,044
Prepaid expenses and other assets	130	(5,388)
Other long-term assets	(1,484)	(261)
(Decrease) increase in liabilities:
Accrued liabilities and accounts payable	(11,031)	(13,417)
Income tax payable	(3,347)	(639)
Contract liability	8,721	3,089
Operating lease liabilities	(4)	310
Other long-term liabilities	(252)	(332)
Total adjustments	19,588	24,448
Net cash provided by operating activities	35,975	54,511
Cash flows from investing activities
Additions to software	(16,494)	(9,257)
Property and equipment acquired	(5,389)	(4,063)
Purchase of equity securities	(111)	0
Acquisitions, net of cash acquired	0	(23,317)
Net cash used in investing activities	(21,994)	(36,637)
Cash flows from financing activities
Withholding taxes paid on share-based compensation	(9,756)	(5,874)
Net increase (decrease) in short-term borrowings	80,000	(20,000)
Dividends paid to noncontrolling interest holders	(1,142)	0
Dividends paid	(3,273)	(3,249)
Repurchase of common stock	(70,000)	(6,269)
Repayment of long-term debt	(5,967)	(5,187)
Repayment of other financing agreement	(6,212)	0
Net cash used in financing activities	(16,350)	(40,579)
Effect of foreign exchange rate on cash, cash equivalents and restricted cash	(3,768)	(275)
Net decrease in cash, cash equivalents and restricted cash	(6,137)	(22,980)
Cash, cash equivalents, restricted cash and cash included in settlement assets at beginning of the period	343,724	215,657
Cash, cash equivalents, restricted cash, and cash included in settlement assets at end of the period	$ 337,587	$ 192,677

XML

The Company and Basis of Presentation

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

The Company and Basis of Presentation

The Company and Basis of Presentation

The Company

EVERTEC, Inc. and its subsidiaries (collectively the “Company” or “EVERTEC”) is a leading full-service transaction-processing business and financial technology provider in Latin America, Puerto Rico and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment services and business process management services. The Company operates across 26 countries in the region. EVERTEC owns and operates the ATH network, which we believe is one of the leading personal identification number (“PIN”) debit networks in the Caribbean and Latin America. In addition, EVERTEC provides a comprehensive suite of services for core banking, cash processing and fulfillment in Puerto Rico and technology outsourcing in all the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations, and government agencies with solutions that are essential to their operations.

Basis of Presentation

The unaudited condensed consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. The preparation of the accompanying unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited condensed consolidated financial statements. Actual results could differ from these estimates.

Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the Securities and Exchange Commission and, accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2023, included in the Company’s 2023 Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited condensed consolidated financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation. Certain amounts from prior periods have been reclassified to conform to the current period presentation.

XML

Business Acquisition

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Business Acquisition

Business Acquisition

Acquisition of a Business

On November 1, 2023, the Company completed the acquisition of 100% of the outstanding shares of Sinqia S.A. (“Sinqia”) (the "Sinqia Transaction"), a publicly held company incorporated and existing in accordance with the laws of the Federative Republic of Brazil. The Company completed the acquisition through its wholly-owned subsidiary, Evertec Brasil Informática S.A (“Evertec BR”). In accordance with ASC 805-10-25-15, Evertec is allowed a period, not to exceed 12 months from the acquisition date, to adjust the provisional amounts recognized for a business combination. During the first quarter of 2024, the Company adjusted the operating lease right-of-use asset, goodwill, long-term deferred tax asset, operating lease liability and the deferred tax liability as a result of additional information that became available during the period. The preliminary purchase price allocation is as follows:

	Assets/Liabilities (at fair value)
( In thousands)
Cash and cash equivalents	$	37,147
Restricted cash	2,166
Accounts receivable, net	9,989
Prepaid expenses and other assets	5,975
Property and equipment, net	3,618
Operating lease right-of-use asset	1,683
Preliminary goodwill	341,801
Equity securities, at fair value	9,035
Long-term deferred tax asset	28,758
Other intangible assets, net	291,048
Other long-term assets	5,455
Total assets acquired	$	736,675
Accounts payable	13,241
Accrued liabilities	40,775
Operating lease liability	4,114
Current portion of long-term debt	11,400
Long-term debt	57,492
Contract liability	7,356
Deferred tax liability	76,150
Other long-term liabilities	15,134
Total liabilities assumed	$	225,662
Redeemable noncontrolling interests	39,340
Additional paid-in capital	471,673
Total liabilities and equity	$	736,675

The following table details the major groups of intangible assets acquired and the weighted average amortization period for these assets:

	Amount		Weighted-average life
(Dollar amounts in thousands)
Customer relationships	$	155,876	18
Trademark	47,688		10
Software packages	87,484		10
Total	$	291,048	14

Refer to Note 4- Goodwill and Other Intangible Assets for detail of goodwill allocated by reportable segments. The goodwill is primarily attributed to selling the Company's products and services to Sinqia's client base, exporting Sinqia's products to other markets where the Company has presence and the assembled workforce. Currently, a portion of goodwill related to previous Sinqia acquisitions is deductible for income tax purposes on a statutory basis. The Company continues to finalize the purchase price allocation and further changes to the preliminary allocation may be required.

XML

Property and Equipment, net

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment, net

Property and Equipment, net

Property and equipment, net consisted of the following:

(Dollar amounts in thousands)	Useful life in years	March 31, 2024		December 31, 2023
Buildings	30	$	2,241	$	2,193
Data processing equipment	3 - 5	190,519		187,761
Furniture and equipment	3 - 20	10,481		10,281
Leasehold improvements	5 -10	4,836		4,876
		208,077		205,111
Less - accumulated depreciation and amortization		(148,817)		(144,117)
Depreciable assets, net		59,260		60,994
Land		1,517		1,459
Property and equipment, net		$	60,777	$	62,453

Depreciation and amortization expense related to property and equipment for the three months ended March 31, 2024 amounted to $5.7 million compared to $5.0 million for the corresponding period in 2023.

XML

Goodwill and Other Intangible Assets

3 Months Ended

Mar. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (see Note 15):

(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Balance at December 31, 2023	$	160,972	$	452,597	$	138,121	$	40,010	$	791,700
Adjustment to goodwill from prior year acquisition	—		(1,352)		—		—		(1,352)
Foreign currency translation adjustments	—		(12,416)		—		—		(12,416)
Balance at March 31, 2024	$	160,972	$	438,829	$	138,121	$	40,010	$	777,932

Goodwill is tested for impairment on an annual basis as of August 31, or more often if events or changes in circumstances indicate there may be impairment. The Company may test for goodwill impairment using a qualitative or a quantitative analysis. In a qualitative analysis, the Company assesses whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. No impairment losses were recognized for the periods ended March 31, 2024 or 2023.

The carrying amount of other intangible assets at March 31, 2024 and December 31, 2023 was as follows:

		March 31, 2024
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	563,127	$	(357,752)	$	205,375
Trademarks	10 - 15	92,535		(44,085)		$	48,450
Software packages	3 - 10	518,676		(283,751)		$	234,925
Non-compete agreement	5	1,687		(249)		$	1,438
Other intangible assets, net		$	1,176,025	$	(685,837)	$	490,188

		December 31, 2023
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	568,284	$	(340,952)	$	227,332
Trademarks	1 - 15	94,203		(41,319)		52,884
Software packages	3 - 10	510,898		(274,610)		236,288
Non-compete agreement	5	1,735		(169)		1,566
Other intangible assets, net		$	1,175,120	$	(657,050)	$	518,070

Amortization expense related to other intangibles for the three months ended March 31, 2024 amounted to $28.8 million compared to $16.3 million for the corresponding period in 2023.

The estimated amortization expense of the other intangible balances outstanding at March 31, 2024, for the remainder of 2024 and the years thereafter is as follows:

(In thousands)
Remaining 2024	$	78,146
2025	81,086
2026	68,499
2027	57,280
2028	46,758
Thereafter	158,419

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Debt and Short-Term Borrowings

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Debt and Short-Term Borrowings

Debt and Short-Term Borrowings

Debt at March 31, 2024 and December 31, 2023 was as follows:

(In thousands)	March 31, 2024		December 31, 2023
2027 Term A Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(2))	$	443,736	$	449,450
2030 Term B Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(3))	521,848		521,233
Deferred consideration from Business Combinations	18,860		19,467
Revolving Facility(2)	80,000		—
Note payable due September 1, 2030(1)	7,191		7,403
Total debt	$	1,071,635	$	997,553

(1)Net of unaccreted discount and unamortized debt issue costs, as applicable.

(2)Subject to a minimum rate ("SOFR floor") of 0.00% plus applicable margin of 2.00% at March 31, 2024 and 1.50% at December 31, 2023.

(3)Subject to a SOFR floor of 0.50% plus applicable margin of 3.50% at March 31, 2024 and December 31, 2023.

Secured Credit Facilities

On December 1, 2022, EVERTEC and EVERTEC Group, entered into a credit agreement with a syndicate of lenders and Truist Bank (“Truist”), as administrative agent and collateral agent, providing for (i) a $415.0 million term loan A facility that matures on December 1, 2027, and a $200.0 million revolving credit facility (the “Revolving Facility”, and together with the Term A Loan Facility, the “2022 Credit Facilities”) that matures on December 1, 2027 (the “2022 Credit Facilities Maturity Date”). On October 30, 2023, Evertec, EVERTEC Group and other Loan Parties (as defined in the Existing Credit Agreement) party thereto, entered into a first amendment (the “Amendment”) to the credit agreement, dated as of December 1, 2022 (the “Existing Credit Agreement,” and as amended by the Amendment, the “Amended Credit Agreement”), with a syndicate of lenders and Truist, as administrative agent and collateral agent. Under the Amended Credit Agreement, a syndicate of financial institutions and other lenders provided (i) additional term loan A commitments in the amount of $60.0 million (the “Incremental TLA Facility”) and (ii) a new tranche of term loan B commitments in the amount of $600.0 million (the “New TLB Facility,” and together with the Incremental TLA Facility, the “Facilities”). The $600.0 million term loan B facility matures on October 30, 2030 (the “Term Loan B Maturity Date”). Unless otherwise indicated, the terms and conditions detailed below apply to both

term loan A facility and term loan B (together "Term Loan Facilities"). In the fourth quarter of 2023, the Company prepaid $60 million of the outstanding balance on Term Loan B.

At March 31, 2024, the unpaid principal balance of the Term A Loan Facility and Term B Loan Facility were $447.5 million and $540.0 million, respectively. At March 31, 2024 the outstanding balance of the Revolving Facility was $80 million and the additional borrowing capacity was $114.0 million, considering letters of credit issued. The Company issues letters of credit against the Revolving Facility which reduce the additional borrowing capacity of the Revolving Facility.

Deferred Consideration for Business Combinations

As part of the Company’s merger and acquisition activities, the Company may enter into agreements by which a portion of the purchase price is financed directly by the seller. At March 31, 2024 and December 31, 2023, the unpaid principal balance of these agreements amounted to $18.9 million and $19.5 million, respectively. Obligations bear interest at rates ranging from 2% to 24% with maturities ranging from April 2024 through March 2027. The current portion of the deferred consideration is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Note Payable

In September 2023, EVERTEC Group entered into a non-interest bearing financing agreement amounting to $10.1 million to purchase software and maintenance which the Company recorded on a discounted basis using an implied interest of 6.9%. As of March 31, 2024, the outstanding principal balance of the note payable on a discounted basis was $7.2 million. The current portion of the note is included in accounts payable and the long-term portion is included in other long-term liabilities on the Company's unaudited condensed consolidated balance sheet.

Interest Rate Swaps

As of March 31, 2024, the Company has four interest rate swap agreements which convert a portion of the interest rate payments on the Company's Term Loan Facilities from variable to fixed. The interest rate swaps are used to hedge the market risk from changes in interest rates corresponding with the Company's variable rate debt. The interest rate swaps are designated as cash flow hedges and are considered highly effective. Cash flows from the interest rate swaps are included in the accrued liabilities and accounts payable line item in the Company's unaudited condensed consolidated statements of cash flows. Changes in the fair value of the interest rate swaps are recognized in other comprehensive income (loss) until the gains or losses are reclassified to earnings. Gains or losses reclassified to earnings are presented within interest expense in the accompanying condensed consolidated statements of income and comprehensive income.

Swap Agreement	Effective date	Maturity Date	Notional Amount	Variable Rate	Fixed Rate
2018 Swap	April 2020	November 2024	$250 million	1-month SOFR	2.929%
2023 Swap	November 2024	December 2027	$250 million	1-month SOFR	3.375%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.182%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.172%

At March 31, 2024, the carrying amount of the derivatives included on the Company's unaudited condensed consolidated balance sheets was an asset of $7.0 million and a liability of $0.9 million, included in other long-term liabilities. At December 31, 2023, the carrying amount of the derivatives included on the Company's unaudited condensed consolidated balance sheet was an asset of $4.4 million and a liability of $0.9 million, included in other long-term liabilities. The fair value of these derivatives are estimated using Level 2 inputs in the fair value hierarchy on a recurring basis. Refer to Note 8 for disclosure of gains (losses) recorded on cash flow hedging activities.

During the three months ended March 31, 2024 and 2023, the Company reclassified gains of $1.7 million and $1.0 million, respectively, from accumulated other comprehensive loss into interest expense. Based on current SOFR rates, the Company expects to reclassify gains of $10.0 million from accumulated other comprehensive loss into interest expense over the next 12 months.

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Financial Instruments and Fair Value Measurements

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Financial Instruments and Fair Value Measurements

Financial Instruments and Fair Value Measurements

Recurring Fair Value Measurements

The following table presents assets and liabilities measured at fair value on a recurring basis at March 31, 2024 and December 31, 2023:

	March 31, 2024								December 31, 2023
(In thousands)	Level 2		Level 3		Measured at NAV		Total		Level 2		Level 3		Total
Financial assets:
Debt securities	$	2,093	$	—	$	—	$	2,093	$	2,095	$	—	$	2,095
Equity securities	—		5,356		5,487		10,843		6,447		2,966		9,413
Interest rate swaps	6,962		—		—		6,962		4,385		—		4,385
Financial liabilities:
Interest rate swaps	900		—		—		900		900		—		900

Debt Securities Available for Sale

Costa Rica Government Obligations are held by a trust in the Costa Rica National Bank as a collateral requirement for settlement activities. The Company may substitute securities as needed but must maintain certain levels of collateral based on transaction volumes. No debt securities were purchased, matured or sold during the quarters ended March 31, 2024 and March 31, 2023. A provision for credit losses was not required for either March 31, 2024 or 2023.

The fair value of debt securities is estimated based on observable inputs through corroboration with market data at the measurement date, therefore classified as a Level 2 asset within the fair value hierarchy.

Derivative Instruments

The fair value of the Company's interest rate swaps are estimated using Level 2 inputs under the fair value hierarchy. Refer to Note 5 for additional information related to the derivative instruments.

Equity Securities

The fair value of the equity securities is calculated based on enterprise value to revenue multiples ranging from 0.4x to 8.3x, therefore classified as a Level 3 asset within the fair value hierarchy. The fair value of the equity securities was $5.4 million at March 31, 2024 and $3.0 million at December 31, 2023. At December 31, 2023, mutual funds classified as equity securities, were registered with the securities and exchange commission in Brazil and were broker traded and therefore classified as Level 2.

The following table presents the changes in equity securities classified as Level 3 assets:

(In thousands)	Equity Securities
Balance at December 31, 2023	$	2,966
Change in fair value of equity securities, recognized through Other income, net	2,353
Foreign currency translation adjustments	37
Balance at March 31, 2024	$	5,356

There were no transfers in or out of Level 3 during the quarter ended March 31, 2024.

Equity Securities Measured at Net Asset Value (NAV)

At March 31, 2024, the Company holds mutual funds classified as equity securities on the Company's unaudited condensed consolidated balance sheet that are measured at fair value using the NAV per share, or its equivalent, as a practical expedient. Mutual funds consist of investments in venture capital strategies and start-ups with a focus on privately held technology companies. The NAV is based on the fair value of the underlying net assets owned by the mutual funds and the relative interest of each participating investor in the fair value of the underlying assets.

Financial assets and liabilities not measured at fair value

The following table presents the carrying value and estimated fair value for financial instruments at March 31, 2024 and December 31, 2023:

	March 31, 2024		December 31, 2023
(In thousands)	Carrying Amount	Fair Value	Carrying Amount	Fair Value
Financial liabilities:
2027 Term A Loan Facility	443,736	448,623	449,450	452,337
2030 Term B Loan Facility	521,848	541,350	521,240	539,325

The fair value of the term loans at March 31, 2024 and December 31, 2023 was obtained using prices provided by third party service providers. Their pricing is based on various inputs such as market quotes, recent trading activity in a non-active market or imputed prices. These inputs are considered Level 3 inputs under the fair value hierarchy. Also, the pricing may include the use of an algorithm that could take into account movements in the general high yield market, among other variants. The secured term loans are not accounted for at fair value in the balance sheet.

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Redeemable Noncontrolling Interests

3 Months Ended

Mar. 31, 2024

Redeemable Noncontrolling Interest [Abstract]

Redeemable Noncontrolling Interests

Redeemable Noncontrolling Interests

At March 31, 2024, redeemable noncontrolling interests ("RNCI") consist of interests in consolidated subsidiaries for which the Company has entered into separate option contracts by which the Company has the right to purchase the remaining non-controlling interests through a call option and the non-controlling interest holder has the right to sell the non-controlling interest to the Company through a put option. The following table summarizes the terms of the issued options:

	Percentage of redeemable noncontrolling interest	Earliest exercise date	Formula of redemption value
Homie Do Brasil Informatica	40%	April 1, 2025	Variable multiple of gross sales dependent upon EBITDA margin and gross sales attained times percentage of ownership
Rosk Software S.A.	49%	March 15, 2025	Variable multiple of gross sales dependent upon EBITDA margin attained times percentage of ownership
Compliasset Software e Solucoes Digitais LTDA.	40%	March 15, 2026	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt times percentage of ownership
Lote45 Participacoes S.A.	48%	January 1, 2027	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt minus BRL$10.0 million times percentage of ownership

Given certain provisions within the options, the Company has classified the RNCI as mezzanine equity on the Company's Balance Sheets. RNCI are adjusted quarterly, if necessary, to their estimated redemption value. Adjustments to the redemption value impact stockholders' equity. The following table presents changes in RNCI:

(In thousands)	Redeemable noncontrolling interests
Balance at December 31, 2023	$	36,968
Net income from redeemable non-controlling interests	518
Adjustment of redeemable non-controlling interests to redemption value	3,172
Balance at March 31, 2024	$	40,658

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Equity

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Equity

Equity

Accumulated Other Comprehensive Income (Loss)

The following table provides a summary of the changes in the balances of accumulated other comprehensive income (loss) for the quarter ended March 31, 2024: 

(In thousands)	Foreign Currency Translation Adjustments		Cash Flow Hedges		Unrealized Gains (Losses) on Debt Securities AFS		Total
Balance - December 31, 2023, net of tax	$	14,847	$	3,336	26		18,209
Other comprehensive income (loss) before reclassifications	(26,476)		4,021		(3)		(22,458)
Effective portion reclassified to net income	$	—	(1,673)		—		(1,673)
Balance - March 31, 2024, net of tax	$	(11,629)	$	5,684	$	23	$	(5,922)

Share Repurchase

On March 6, 2024, the Company entered into an accelerated share repurchase agreement (the “ASR”) with Bank of America, N.A. to repurchase an aggregate of $70 million of the Company’s common stock, par value $0.01 per share. In connection with the launch of the ASR, on March 8, 2024, the Company paid Bank of America, N.A., an aggregate of $70 million and received approximately 1.5 million shares of the Company’s common stock. The final number of shares to be received under the ASR agreement will be determined upon completion of the transaction and will be based on the total transaction value and the average of the daily volume-weighted average share price of the Company’s common stock during the term of the transaction. Final settlement of the transaction is expected to be completed in the third quarter of 2024. The Company accounted for this contract as an equity contract. If upon contract termination, an amount is owed by the Company, the contract can be net settled in cash or shares at the Company's option.

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Share-based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Share-based Compensation

Share-based Compensation

Long-term Incentive Plan ("LTIP")

During the three months ended March 31, 2022, 2023 and 2024, the Compensation Committee (the "Compensation Committee") of the Company's Board of Directors ("Board") approved grants of restricted stock units (“RSUs”) to executives and certain employees pursuant to the 2022 LTIP, 2023 LTIP and 2024 LTIP, respectively, all under the terms of the Company's 2022 Equity Incentive Plan. Under the LTIPs, the Company granted RSUs to eligible participants as time-based awards and/or performance-based awards.

The vesting of the RSUs is dependent upon service and/or performance conditions as defined in the award agreements. Employees that received time-based awards with service conditions are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the employee provides services to the Company through the vesting date. Time-based awards generally vest over a period of three years in substantially equal installments commencing on the grant date and ending on February 25 of each year for the 2022 LTIP, February 24 of each year for the 2023 LTIP and February 28 of each year for the 2024 LTIP. In 2022 and 2023, the Company also granted time-based awards with a three year service vesting period which will cliff vest on February 25, 2025 and February 24, 2026, respectively.

For the performance-based awards under the 2022 LTIP, 2023 LTIP, and 2024 LTIP, the Compensation Committee established adjusted earnings before interest, income taxes, depreciation and amortization ("Adjusted EBITDA") as the primary performance measure while maintaining focus on total shareholder return through the use of a market-based total shareholder return ("TSR") performance modifier. The Adjusted EBITDA measure is based on annual Adjusted EBITDA targets and can result in a payout between 0% and 200%, depending on the performance level. The TSR modifier adjusts the shares earned based on the Adjusted EBITDA performance upwards or downwards (+/- 25%) based on the Company’s relative TSR at the end of the three-year performance period as compared to the companies in the Russell 2000 Index. The Adjusted EBITDA performance measure will be calculated for the one-year period commencing on January 1 of the year of the grant and ending on December 31 of the same year, relative to the goals set by the Compensation Committee for this same period. The shares earned will be subject to an additional two-year service vesting period and will vest on February 25, 2025 for the 2022 LTIP, February 24, 2026 for the 2023 LTIP and February 28, 2027 for the 2024 LTIP. Unless otherwise specified in the award agreement, or in an employment agreement, awards are forfeited if the employee voluntarily ceases to be employed by the Company prior to vesting.

The following table summarizes nonvested RSUs activity for the three months ended March 31, 2024:

Nonvested RSUs	Shares	Weighted-average grant date fair value
Nonvested at December 31, 2023	1,799,012	$	39.42
Granted	1,097,178	36.89
Vested	(738,996)	36.92
Forfeited	(10,220)	38.90
Nonvested at March 31, 2024	2,146,974	$	38.56

For the three months ended March 31, 2024, the Company recognized $7.3 million of share-based compensation expense, compared with $5.6 million for the corresponding period in 2023.

As of March 31, 2024, the maximum unrecognized cost for RSUs was $64.0 million. The cost is expected to be recognized over a weighted average period of 2.5 years.

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Revenues

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenues

Revenues

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers into primary geographical markets, nature of the products and services, and timing of transfer of goods and services. The Company's operating segments are determined by the nature of the products and services the Company provides and the primary geographical markets in which the Company operates. Revenue disaggregated by segment is discussed in Note 15, Segment Information.

In the following tables, revenue for each segment, excluding intersegment revenues, is disaggregated by timing of revenue

recognition for the periods indicated.

	Three months ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	32	$	557	$	—	$	2,475	$	3,064
Products and services transferred over time	33,912		69,590		43,099		55,653		$	202,254
	$	33,944	$	70,147	$	43,099	$	58,128	$	205,318

	Three months ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	113	$	614	$	—	$	1,727	$	2,454
Products and services transferred over time	32,366		30,679		40,347		53,968		$	157,360
	$	32,479	$	31,293	$	40,347	$	55,695	$	159,814

Revenue concentration with a single customer, Popular, as a percentage of total revenues for the quarters ended March 31, 2024 and 2023 was approximately 31% and 37%, respectively. Accounts receivable from Popular as of March 31, 2024 and March 31, 2023 amounted to $49.3 million and $41.2 million, respectively.

Contract Balances

The following table provides information about contract assets from contracts with customers for the three months ended March 31, 2024 and the year ended December 31, 2023.

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	13,917	$	4,749
Services transferred to customers	4,889		28,165
Transfers to accounts receivable	(5,568)		(18,997)
Balance at end of period	$	13,238	$	13,917

The current portion of contract assets is recorded as part of prepaid expenses and other assets, and the long-term portion is included in other long-term assets in the unaudited condensed consolidated balance sheets.

Accounts receivable, net at March 31, 2024 amounted to $141.3 million. Contract liability and contract liability - long term at March 31, 2024 amounted to $18.9 million and $52.1 million, respectively, and may arise when consideration is received or due in advance from customers prior to performance. The contract liability is mainly comprised of upfront fees for implementation or set up activities, including fees charged in pre-production periods in connection with hosting services. During the three months ended March 31, 2024 and 2023, the Company recognized revenue of $7.8 million and $4.4 million, respectively, that was included in the contract liability at December 31, 2023 and 2022, respectively.

Transaction price allocated to the remaining performance obligations

The estimated aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially satisfied at March 31, 2024 was $891.9 million, which is expected to be recognized over the next 1 to 6 years. This amount consists of minimums on certain master services agreements, professional service fees for implementation or set up activities related to managed services and maintenance services typically recognized over the life of the contract, and professional service fees for customizations or development of on-premise licensing agreements, which are recognized over time based on inputs relative to the total expected inputs to satisfy a performance obligation.

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Current Expected Credit Losses

3 Months Ended

Mar. 31, 2024

Receivables [Abstract]

Current Expected Credit Losses

Current Expected Credit Losses

Allowance for Current Expected Credit Losses

Trade receivables from contracts with customers are financial assets analyzed by the Company under the expected credit loss model. To measure expected credit losses, trade receivables are grouped based on shared risk characteristics (i.e., the relevant industry sector and customer's geographical location) and days past due (i.e., delinquency status), while considering the following:

•Customers in the same geographical location share similar risk characteristics associated with the macroeconomic environment of their country.

•The Company has two main industry sectors: private and governmental. The private pool is comprised mainly of leading financial institutions, merchants and corporations, while the governmental pool is comprised of government agencies. The governmental customers possess different risk characteristics than private customers because although all invoices are due 30 days after issuance, governmental customers usually pay within 60 to 90 days after issuance (i.e., approximately 30 to 60 more days than private customers).

•The expected credit loss rate is likely to increase as receivables move to older aging buckets. The Company used the following aging categories to estimate the risk of delinquency status: (i) 0 days past due; (ii) 1-30 days past due; (iii) 31-60 days past due; (iv) 61-90 days past due; and (v) over 90 days past due.

The credit losses of the Company’s trade receivables have been low historically and most balances are collected within one year. Therefore, the Company determined that the expected loss rates should be calculated using the historical loss rates adjusted by macroeconomic factors. The historical rates are calculated for each of the aging categories used for pooling trade receivables. To determine the collected portion of each bucket, the collection time of each trade receivable is identified, to estimate the proportion of outstanding balances per aging bucket that ultimately will not be collected. This is used to determine the expectation of losses based on the history of uncollected trade receivables once the specific past due period is surpassed. The historical rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the

ability of customers to settle the receivables by applying a country risk premium as the forward-looking macroeconomic factor. Specific reserves are established for certain customers for which collection is doubtful.

Rollforward of the Allowance for Expected Current Credit Losses

The following table provides information about the allowance for expected current credit losses on trade receivables for the three months ended March 31, 2024 and the year ended December 31, 2023

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	4,010	$	2,159
Current period provision for expected credit losses	378		2,218
Write-offs	(1,371)		(384)
Recoveries of amounts previously written-off	1		17
Balance at end of period	$	3,018	$	4,010

The Company does not have a delinquency threshold for writing-off trade receivables. The Company has a formal process for the review and approval of write-offs.

Impairment losses on trade receivables are presented as net impairment losses within cost of revenue, exclusive of depreciation and amortization in the unaudited condensed consolidated statements of income and comprehensive income. Subsequent recoveries of amounts previously written-off, when applicable, are credited against the allowance for expected current credit losses within accounts receivable, net on the unaudited condensed consolidated balance sheets.

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Income Tax

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

Income Tax

Income Tax

The components of income tax expense for the three months ended March 31, 2024 and 2023, respectively, consisted of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision	$	6,012	$	5,026
Deferred tax benefit	(5,720)		(2,208)
Income tax (benefit) expense	$	292	$	2,818

The Company conducts operations in Puerto Rico, the United States, and certain countries in Latin America. As a result, the income tax expense includes the effect of taxes paid to the government of Puerto Rico as well as foreign jurisdictions. The following table presents the components of income tax expense for the three months ended March 31, 2024 and 2023, and its segregation based on location of operations:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision
Puerto Rico	$	606	$	1,180
United States	90		11
Foreign countries	5,316		3,835
Total current tax provision	$	6,012	$	5,026
Deferred tax benefit
Puerto Rico	$	(3,659)	$	(235)
United States	(9)		(26)
Foreign countries	(2,052)		(1,947)
Total deferred tax benefit	$	(5,720)	$	(2,208)

Taxes payable to foreign countries by EVERTEC’s subsidiaries is paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements.

As of March 31, 2024, the Company had $139.8 million of unremitted earnings from foreign subsidiaries, compared to $137.0 million as of December 31, 2023. The Company has not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries because these earnings are intended to be indefinitely reinvested.

As of March 31, 2024, the gross deferred tax asset amounted to $71.1 million and the gross deferred tax liability amounted to $100.1 million, compared to $65.4 million and $100.9 million, respectively, as of December 31, 2023. As of March 31, 2024, and December 31, 2023, there is a valuation allowance against the gross deferred tax asset of approximately $4.7 million and $4.6 million, respectively.

The Company estimates that it is reasonably possible that the liability for uncertain tax position created from acquisitions in foreign jurisdictions will decrease by approximately $2.6 million in the next 12 months as a result of the expiration of the statute of limitations.

Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Computed income tax at statutory rates	$	6,260	$	12,330
Differences in tax rates due to multiple jurisdictions	1,419		1,029
Effect of income subject to tax-exemption grant	(8,252)		(8,849)
Unrecognized tax expense	142		34
Excess tax benefits on share-based compensation	(526)		(91)
Tax credits for research and development activities	—		(884)
Other, net	1,249		(751)
Income tax expense	$	292	$	2,818

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Net Income Per Common Share

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Net Income Per Common Share

Net Income Per Common Share

The reconciliation of the numerator and the denominator of net income per common share is as follows:

	Three Months Ended March 31,
(In thousands, except per share information)	2024		2023
Net income available to EVERTEC, Inc.’s common shareholders	$	15,979	$	30,052
Weighted average common shares outstanding	65,179,965		64,968,298
Weighted average potential dilutive common shares (1)	1,156,714		640,320
Weighted average common shares outstanding - assuming dilution	66,336,679		65,608,618
Net income per common share - basic	$	0.25	$	0.46
Net income per common share - diluted	$	0.24	$	0.46

(1)Potential common shares consist of common stock issuable under RSUs awards using the treasury stock method. Shares excluded from the dilution calculation because they were anti-dilutive amounted to 0.4 million.

On February 15, 2024 the Company's Board declared quarterly cash dividends of $0.05 per share of common stock, which was paid on March 15, 2024, to stockholders' of record on February 27, 2024.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

EVERTEC is a defendant in a number of legal proceedings arising in the ordinary course of business. Based on the opinion of legal counsel and other factors, management believes that the final disposition of these matters will not have a material adverse effect on the business, results of operations, financial condition, or cash flows of the Company. The Company has identified certain claims in which a loss may be incurred, but in the aggregate the loss would be insignificant. For other claims, where the proceedings are in an initial phase, the Company is unable to estimate the range of possible loss, if any, but at this time, management believes that any loss related to such claims will not be material.

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Segment Information

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company operates in four business segments: Payment Services - Puerto Rico & Caribbean, Latin America Payments and Solutions, Merchant Acquiring, and Business Solutions.

The Payment Services - Puerto Rico & Caribbean segment revenues are comprised of revenues related to providing access to the ATH debit network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and point of sale ("POS") transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), ATH Movil (person-to-person) and ATH Business (person-to-merchant) digital transactions and EBT (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file.

The Latin America Payments and Solutions segment revenues consist of revenues related to providing access to the ATH network of ATMs and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), as well as licensed software solutions for risk and fraud management and card payment processing. For network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from transaction switching, processing fees, and the leasing of POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed, and other processing services. Solutions revenues consist of (a) licensing, support and maintenance (“subscription”), implementation and customization of software used to provide financial products in areas such as core banking, credit, investments, payments, foreign exchange, mutual funds, pension funds and consortium, in addition to software used to execute processes such as digital onboarding, digital signature and digital collection; and (b) outsourcing of mission critical IT services. Revenues are based on monthly fixed fees and, in several cases, variable fees based on usage.

The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charges merchants for other services that are unrelated to the number of transactions or the transaction value.

The Business Solutions segment consists of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fixed fee and from fees based on the number of accounts on file (i.e., savings or checking accounts, loans, etc.), server capacity usage or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC is a reseller of hardware and software products and these resale transactions are generally non-recurring.

In addition to the four operating segments described above, management identified certain functional cost areas that operate independently and do not constitute businesses in themselves. These areas could neither be concluded as operating segments nor could they be combined with any other operating segments. Therefore, these areas are aggregated and presented within the “Corporate and Other” category in the financial statements alongside the operating segments. The Corporate and Other category consists of corporate overhead expenses, intersegment eliminations, certain leveraged activities and other non-operating and miscellaneous expenses that are not included in the operating segments. The overhead and leveraged costs relate to activities such as:

•marketing,

•corporate finance and accounting,

•human resources,

•legal,

•risk management functions,

•internal audit,

•corporate debt related costs,

•non-operating depreciation and amortization expenses generated as a result of merger and acquisition activity,

•intersegment revenues and expenses, and

•other non-recurring fees and expenses that are not considered when management evaluates financial performance at a segment level

The Chief Operating Decision Maker ("CODM") reviews the operating segments separate financial information to assess performance and to allocate resources. Management evaluates the operating results of each of its operating segments based upon revenues and Adjusted EBITDA. Adjusted EBITDA is defined as EBITDA further adjusted to exclude certain non-cash unrealized items and unusual expenses such as: share-based compensation, restructuring related expenses, fees and expenses from corporate transactions such as M&A activity and financing, equity investment income net of dividends received, and the impact from unrealized gains and losses on foreign currency remeasurement for assets and liabilities in non-functional currency. Adjusted EBITDA, as it relates to operating segments, is presented in conformity with ASC Topic 280, Segment Reporting, given that it is reported to the CODM for purposes of allocating resources. The Company has recast prior periods to conform with the modified definition of Adjusted EBITDA. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by revenues and Adjusted EBITDA. As such, segment assets are not disclosed in the notes to the unaudited condensed consolidated financial statements.

The following tables set forth information about the Company’s operations by its four business segments for the periods indicated:

	Three Months Ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	53,031	$	74,216	$	43,099	$	58,128	$	(23,156)	$	205,318
Operating costs and expenses	30,952		76,031		28,819		40,451		(3,738)		172,515
Depreciation and amortization	7,262		16,257		1,233		4,438		5,251		34,441
Non-operating income (expenses)	148		(1,165)		—		139		1,333		455
EBITDA	29,489		13,277		15,513		22,254		(12,834)		67,699
Compensation and benefits (2)	698		1,498		707		785		4,302		7,990
Transaction, refinancing and other (3)	267		(3,029)		—		—		794		(1,968)
(Gain) loss on foreign currency remeasurement (4)	(102)		4,551		—		—		7		4,456
Adjusted EBITDA	$	30,352	$	16,297	$	16,220	$	23,039	$	(7,731)	$	78,177

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $14.6 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.1 million from Latin America Payments and Solutions to both Payment Services- Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $4.5 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of unrealized gains from equity securities and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

	Three Months Ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	48,429	$	35,317	$	40,347	$	55,695	$	(19,974)	$	159,814
Operating costs and expenses	27,722		29,312		26,689		38,913		(2,912)		119,724
Depreciation and amortization	5,888		2,711		1,129		4,488		5,216		19,432
Non-operating income (expenses)	365		(3,785)		307		532		(118)		(2,699)
EBITDA	26,960		4,931		15,094		21,802		(11,964)		56,823
Compensation and benefits (2)	528		652		532		565		3,568		5,845
Transaction, refinancing and other(3)	292		—		—		—		(689)		(397)
Loss (gain) on foreign currency remeasurement (4)	95		4,772		—		—		(3)		4,864
Adjusted EBITDA	$	27,875	$	10,355	$	15,626	$	22,367	$	(9,088)	$	67,135

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $13.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.0 million from Latin America Payments and Solutions to both Payment Services - Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $2.9 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

The reconciliation of consolidated net income to EBITDA is as follows:

	Three months ended March 31,
(In thousands)	2024		2023
Net Income	$	16,387	$	30,063
Add:
Income tax expense	292		2,818
Interest expense, net	16,579		4,510
Depreciation and amortization	34,441		19,432
Total EBITDA	$	67,699	$	56,823

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Supplemental Statement of Cash Flows Information

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Statement of Cash Flows Information

Supplemental Statement of Cash Flows Information

Supplemental statement of cash flows information is as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Supplemental disclosure of cash flow information:
Cash paid for interest	18,924	5,874
Cash paid for income taxes	4,250	6,119
Supplemental disclosure of non-cash activities:
Payable due to vendor related to equipment and software acquired	5,550	5,282
Accounts payable related to business acquisition	—	881
Right-of-use assets obtained in exchange for operating lease liabilities	2,693	—

Reconciliation of cash, cash equivalents, restricted cash and cash included in settlement assets as presented on the cash flow statement was as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Cash and cash equivalents	293,666	114,201
Restricted cash	23,597	$	19,015
Cash and cash equivalents included in settlement assets	20,324	59,461
Cash, cash equivalents, restricted cash and cash included in settlement assets	337,587	192,677

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Subsequent Events	3 Months Ended
	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent EventsOn April 18, 2024, the Board declared a regular quarterly cash dividend of $0.05 per share on the Company’s outstanding shares of common stock. The dividend is expected to be paid on June 7, 2024 to stockholders of record as of the close of business on April 29, 2024. The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to the Board’s approval and may be adjusted as business needs or market conditions change.

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net income	$ 15,979	$ 30,052

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Insider Trading Arrangements	3 Months Ended
	Mar. 31, 2024 shares
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Terminated	false
Morgan M. Schuessler [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement	On March 5, 2024, the Company’s President and Chief Executive Officer, Morgan M. Schuessler, terminated a “Rule 105b-1 trading arrangement,” (as defined in Item 408(a) of Regulation S-K) which was adopted on August 30, 2023, provided for the sale of up to 84,467 shares of the Company’s common stock, and had a planned end date of October 4, 2024.
Name	Morgan M. Schuessler
Title	President and Chief Executive Officer
Adoption Date	August 30, 2023
Rule 10b5-1 Arrangement Terminated	true
Termination Date	On March 5, 2024
Arrangement Duration	401 days
Aggregate Available	84,467

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The Company and Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

The Company

The Company

EVERTEC, Inc. and its subsidiaries (collectively the “Company” or “EVERTEC”) is a leading full-service transaction-processing business and financial technology provider in Latin America, Puerto Rico and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment services and business process management services. The Company operates across 26 countries in the region. EVERTEC owns and operates the ATH network, which we believe is one of the leading personal identification number (“PIN”) debit networks in the Caribbean and Latin America. In addition, EVERTEC provides a comprehensive suite of services for core banking, cash processing and fulfillment in Puerto Rico and technology outsourcing in all the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations, and government agencies with solutions that are essential to their operations.

Basis of Presentation

Basis of Presentation

The unaudited condensed consolidated financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. The preparation of the accompanying unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited condensed consolidated financial statements. Actual results could differ from these estimates.

Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the Securities and Exchange Commission and, accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2023, included in the Company’s 2023 Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited condensed consolidated financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation. Certain amounts from prior periods have been reclassified to conform to the current period presentation.

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Business Acquisition (Tables)

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Schedule of fair value of assets acquired and liabilities assumed

The preliminary purchase price allocation is as follows:

	Assets/Liabilities (at fair value)
( In thousands)
Cash and cash equivalents	$	37,147
Restricted cash	2,166
Accounts receivable, net	9,989
Prepaid expenses and other assets	5,975
Property and equipment, net	3,618
Operating lease right-of-use asset	1,683
Preliminary goodwill	341,801
Equity securities, at fair value	9,035
Long-term deferred tax asset	28,758
Other intangible assets, net	291,048
Other long-term assets	5,455
Total assets acquired	$	736,675
Accounts payable	13,241
Accrued liabilities	40,775
Operating lease liability	4,114
Current portion of long-term debt	11,400
Long-term debt	57,492
Contract liability	7,356
Deferred tax liability	76,150
Other long-term liabilities	15,134
Total liabilities assumed	$	225,662
Redeemable noncontrolling interests	39,340
Additional paid-in capital	471,673
Total liabilities and equity	$	736,675

Schedule of intangible assets acquired and weighted average amortization period

The following table details the major groups of intangible assets acquired and the weighted average amortization period for these assets:

	Amount		Weighted-average life
(Dollar amounts in thousands)
Customer relationships	$	155,876	18
Trademark	47,688		10
Software packages	87,484		10
Total	$	291,048	14

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Property and Equipment, net (Tables)

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Summary of property and equipment, net

Property and equipment, net consisted of the following:

(Dollar amounts in thousands)	Useful life in years	March 31, 2024		December 31, 2023
Buildings	30	$	2,241	$	2,193
Data processing equipment	3 - 5	190,519		187,761
Furniture and equipment	3 - 20	10,481		10,281
Leasehold improvements	5 -10	4,836		4,876
		208,077		205,111
Less - accumulated depreciation and amortization		(148,817)		(144,117)
Depreciable assets, net		59,260		60,994
Land		1,517		1,459
Property and equipment, net		$	60,777	$	62,453

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Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of changes in carrying amount of goodwill allocated by reportable segments

The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (see Note 15):

(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Balance at December 31, 2023	$	160,972	$	452,597	$	138,121	$	40,010	$	791,700
Adjustment to goodwill from prior year acquisition	—		(1,352)		—		—		(1,352)
Foreign currency translation adjustments	—		(12,416)		—		—		(12,416)
Balance at March 31, 2024	$	160,972	$	438,829	$	138,121	$	40,010	$	777,932

Summary of carrying amount of other intangible assets

The carrying amount of other intangible assets at March 31, 2024 and December 31, 2023 was as follows:

		March 31, 2024
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	563,127	$	(357,752)	$	205,375
Trademarks	10 - 15	92,535		(44,085)		$	48,450
Software packages	3 - 10	518,676		(283,751)		$	234,925
Non-compete agreement	5	1,687		(249)		$	1,438
Other intangible assets, net		$	1,176,025	$	(685,837)	$	490,188

		December 31, 2023
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	8 - 20	$	568,284	$	(340,952)	$	227,332
Trademarks	1 - 15	94,203		(41,319)		52,884
Software packages	3 - 10	510,898		(274,610)		236,288
Non-compete agreement	5	1,735		(169)		1,566
Other intangible assets, net		$	1,175,120	$	(657,050)	$	518,070

Summary of estimated amortization expenses

The estimated amortization expense of the other intangible balances outstanding at March 31, 2024, for the remainder of 2024 and the years thereafter is as follows:

(In thousands)
Remaining 2024	$	78,146
2025	81,086
2026	68,499
2027	57,280
2028	46,758
Thereafter	158,419

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Debt and Short-Term Borrowings (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Summary of total debt

Debt at March 31, 2024 and December 31, 2023 was as follows:

(In thousands)	March 31, 2024		December 31, 2023
2027 Term A Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(2))	$	443,736	$	449,450
2030 Term B Loan bearing interest at a variable interest rate (SOFR plus applicable margin(1)(3))	521,848		521,233
Deferred consideration from Business Combinations	18,860		19,467
Revolving Facility(2)	80,000		—
Note payable due September 1, 2030(1)	7,191		7,403
Total debt	$	1,071,635	$	997,553

(1)Net of unaccreted discount and unamortized debt issue costs, as applicable.

(2)Subject to a minimum rate ("SOFR floor") of 0.00% plus applicable margin of 2.00% at March 31, 2024 and 1.50% at December 31, 2023.

(3)Subject to a SOFR floor of 0.50% plus applicable margin of 3.50% at March 31, 2024 and December 31, 2023.

Summary of interest rate swap transaction

Swap Agreement	Effective date	Maturity Date	Notional Amount	Variable Rate	Fixed Rate
2018 Swap	April 2020	November 2024	$250 million	1-month SOFR	2.929%
2023 Swap	November 2024	December 2027	$250 million	1-month SOFR	3.375%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.182%
2024 Swap	March 2024	October 2027	$150 million	1-month SOFR	4.172%

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Financial Instruments and Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Fair value measurements for assets and liabilities at fair value on recurring basis

The following table presents assets and liabilities measured at fair value on a recurring basis at March 31, 2024 and December 31, 2023:

	March 31, 2024								December 31, 2023
(In thousands)	Level 2		Level 3		Measured at NAV		Total		Level 2		Level 3		Total
Financial assets:
Debt securities	$	2,093	$	—	$	—	$	2,093	$	2,095	$	—	$	2,095
Equity securities	—		5,356		5,487		10,843		6,447		2,966		9,413
Interest rate swaps	6,962		—		—		6,962		4,385		—		4,385
Financial liabilities:
Interest rate swaps	900		—		—		900		900		—		900

Summary of equity securities classified as Level 3 assets

The following table presents the changes in equity securities classified as Level 3 assets:

(In thousands)	Equity Securities
Balance at December 31, 2023	$	2,966
Change in fair value of equity securities, recognized through Other income, net	2,353
Foreign currency translation adjustments	37
Balance at March 31, 2024	$	5,356

Summary of carrying value and estimated fair values for financial instruments

The following table presents the carrying value and estimated fair value for financial instruments at March 31, 2024 and December 31, 2023:

	March 31, 2024		December 31, 2023
(In thousands)	Carrying Amount	Fair Value	Carrying Amount	Fair Value
Financial liabilities:
2027 Term A Loan Facility	443,736	448,623	449,450	452,337
2030 Term B Loan Facility	521,848	541,350	521,240	539,325

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Redeemable Noncontrolling Interests (Tables)

3 Months Ended

Mar. 31, 2024

Redeemable Noncontrolling Interest [Abstract]

Summary of Terms and Changes in Redeemable Noncontrolling Interests

The following table summarizes the terms of the issued options:

	Percentage of redeemable noncontrolling interest	Earliest exercise date	Formula of redemption value
Homie Do Brasil Informatica	40%	April 1, 2025	Variable multiple of gross sales dependent upon EBITDA margin and gross sales attained times percentage of ownership
Rosk Software S.A.	49%	March 15, 2025	Variable multiple of gross sales dependent upon EBITDA margin attained times percentage of ownership
Compliasset Software e Solucoes Digitais LTDA.	40%	March 15, 2026	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt times percentage of ownership
Lote45 Participacoes S.A.	48%	January 1, 2027	Variable multiple of net sales dependent upon EBITDA margin attained plus net debt minus BRL$10.0 million times percentage of ownership

The following table presents changes in RNCI:

(In thousands)	Redeemable noncontrolling interests
Balance at December 31, 2023	$	36,968
Net income from redeemable non-controlling interests	518
Adjustment of redeemable non-controlling interests to redemption value	3,172
Balance at March 31, 2024	$	40,658

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Equity (Tables)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Summary of changes in balances of accumulated other comprehensive income (loss)

The following table provides a summary of the changes in the balances of accumulated other comprehensive income (loss) for the quarter ended March 31, 2024: 

(In thousands)	Foreign Currency Translation Adjustments		Cash Flow Hedges		Unrealized Gains (Losses) on Debt Securities AFS		Total
Balance - December 31, 2023, net of tax	$	14,847	$	3,336	26		18,209
Other comprehensive income (loss) before reclassifications	(26,476)		4,021		(3)		(22,458)
Effective portion reclassified to net income	$	—	(1,673)		—		(1,673)
Balance - March 31, 2024, net of tax	$	(11,629)	$	5,684	$	23	$	(5,922)

Share Repurchase

On March 6, 2024, the Company entered into an accelerated share repurchase agreement (the “ASR”) with Bank of America, N.A. to repurchase an aggregate of $70 million of the Company’s common stock, par value $0.01 per share. In connection with the launch of the ASR, on March 8, 2024, the Company paid Bank of America, N.A., an aggregate of $70 million and received approximately 1.5 million shares of the Company’s common stock. The final number of shares to be received under the ASR agreement will be determined upon completion of the transaction and will be based on the total transaction value and the average of the daily volume-weighted average share price of the Company’s common stock during the term of the transaction. Final settlement of the transaction is expected to be completed in the third quarter of 2024. The Company accounted for this contract as an equity contract. If upon contract termination, an amount is owed by the Company, the contract can be net settled in cash or shares at the Company's option.

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Share-based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Summary of nonvested RSUs activity

The following table summarizes nonvested RSUs activity for the three months ended March 31, 2024:

Nonvested RSUs	Shares	Weighted-average grant date fair value
Nonvested at December 31, 2023	1,799,012	$	39.42
Granted	1,097,178	36.89
Vested	(738,996)	36.92
Forfeited	(10,220)	38.90
Nonvested at March 31, 2024	2,146,974	$	38.56

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Revenues (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Summary of disaggregation of revenue

In the following tables, revenue for each segment, excluding intersegment revenues, is disaggregated by timing of revenue

recognition for the periods indicated.

	Three months ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	32	$	557	$	—	$	2,475	$	3,064
Products and services transferred over time	33,912		69,590		43,099		55,653		$	202,254
	$	33,944	$	70,147	$	43,099	$	58,128	$	205,318

	Three months ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Total
Timing of revenue recognition
Products and services transferred at a point in time	$	113	$	614	$	—	$	1,727	$	2,454
Products and services transferred over time	32,366		30,679		40,347		53,968		$	157,360
	$	32,479	$	31,293	$	40,347	$	55,695	$	159,814

Summary of contract balances

The following table provides information about contract assets from contracts with customers for the three months ended March 31, 2024 and the year ended December 31, 2023.

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	13,917	$	4,749
Services transferred to customers	4,889		28,165
Transfers to accounts receivable	(5,568)		(18,997)
Balance at end of period	$	13,238	$	13,917

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Current Expected Credit Losses (Tables)

3 Months Ended

Mar. 31, 2024

Receivables [Abstract]

Schedule of allowance for credit losses on trade receivables

The following table provides information about the allowance for expected current credit losses on trade receivables for the three months ended March 31, 2024 and the year ended December 31, 2023

(In thousands)	March 31, 2024		December 31, 2023
Balance at beginning of period	$	4,010	$	2,159
Current period provision for expected credit losses	378		2,218
Write-offs	(1,371)		(384)
Recoveries of amounts previously written-off	1		17
Balance at end of period	$	3,018	$	4,010

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Income Tax (Tables)

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

Components of income tax expense

The components of income tax expense for the three months ended March 31, 2024 and 2023, respectively, consisted of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision	$	6,012	$	5,026
Deferred tax benefit	(5,720)		(2,208)
Income tax (benefit) expense	$	292	$	2,818

Segregation of income tax expense based on location of operations

The following table presents the components of income tax expense for the three months ended March 31, 2024 and 2023, and its segregation based on location of operations:

	Three months ended March 31,
(In thousands)	2024		2023
Current tax provision
Puerto Rico	$	606	$	1,180
United States	90		11
Foreign countries	5,316		3,835
Total current tax provision	$	6,012	$	5,026
Deferred tax benefit
Puerto Rico	$	(3,659)	$	(235)
United States	(9)		(26)
Foreign countries	(2,052)		(1,947)
Total deferred tax benefit	$	(5,720)	$	(2,208)

Schedule of income tax expense differs from computed income tax at statutory rates

Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	Three months ended March 31,
(In thousands)	2024		2023
Computed income tax at statutory rates	$	6,260	$	12,330
Differences in tax rates due to multiple jurisdictions	1,419		1,029
Effect of income subject to tax-exemption grant	(8,252)		(8,849)
Unrecognized tax expense	142		34
Excess tax benefits on share-based compensation	(526)		(91)
Tax credits for research and development activities	—		(884)
Other, net	1,249		(751)
Income tax expense	$	292	$	2,818

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Net Income Per Common Share (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Schedule of reconciliation of numerator and denominator of net income per common share

The reconciliation of the numerator and the denominator of net income per common share is as follows:

	Three Months Ended March 31,
(In thousands, except per share information)	2024		2023
Net income available to EVERTEC, Inc.’s common shareholders	$	15,979	$	30,052
Weighted average common shares outstanding	65,179,965		64,968,298
Weighted average potential dilutive common shares (1)	1,156,714		640,320
Weighted average common shares outstanding - assuming dilution	66,336,679		65,608,618
Net income per common share - basic	$	0.25	$	0.46
Net income per common share - diluted	$	0.24	$	0.46

(1)Potential common shares consist of common stock issuable under RSUs awards using the treasury stock method. Shares excluded from the dilution calculation because they were anti-dilutive amounted to 0.4 million.

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Summary of information about operations by business segments

The following tables set forth information about the Company’s operations by its four business segments for the periods indicated:

	Three Months Ended March 31, 2024
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	53,031	$	74,216	$	43,099	$	58,128	$	(23,156)	$	205,318
Operating costs and expenses	30,952		76,031		28,819		40,451		(3,738)		172,515
Depreciation and amortization	7,262		16,257		1,233		4,438		5,251		34,441
Non-operating income (expenses)	148		(1,165)		—		139		1,333		455
EBITDA	29,489		13,277		15,513		22,254		(12,834)		67,699
Compensation and benefits (2)	698		1,498		707		785		4,302		7,990
Transaction, refinancing and other (3)	267		(3,029)		—		—		794		(1,968)
(Gain) loss on foreign currency remeasurement (4)	(102)		4,551		—		—		7		4,456
Adjusted EBITDA	$	30,352	$	16,297	$	16,220	$	23,039	$	(7,731)	$	78,177

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $14.6 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.1 million from Latin America Payments and Solutions to both Payment Services- Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $4.5 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of unrealized gains from equity securities and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

	Three Months Ended March 31, 2023
(In thousands)	Payment Services - Puerto Rico & Caribbean		Latin America Payments and Solutions		Merchant Acquiring, net		Business Solutions		Corporate and Other (1)		Total
Revenues	$	48,429	$	35,317	$	40,347	$	55,695	$	(19,974)	$	159,814
Operating costs and expenses	27,722		29,312		26,689		38,913		(2,912)		119,724
Depreciation and amortization	5,888		2,711		1,129		4,488		5,216		19,432
Non-operating income (expenses)	365		(3,785)		307		532		(118)		(2,699)
EBITDA	26,960		4,931		15,094		21,802		(11,964)		56,823
Compensation and benefits (2)	528		652		532		565		3,568		5,845
Transaction, refinancing and other(3)	292		—		—		—		(689)		(397)
Loss (gain) on foreign currency remeasurement (4)	95		4,772		—		—		(3)		4,864
Adjusted EBITDA	$	27,875	$	10,355	$	15,626	$	22,367	$	(9,088)	$	67,135

(1)Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations.  Intersegment revenue eliminations predominantly reflect the $13.0 million processing fee from Payments Services - Puerto Rico & Caribbean to Merchant Acquiring, intercompany software developments and transaction-processing of $4.0 million from Latin America Payments and Solutions to both Payment Services - Puerto Rico & Caribbean and Business Solutions, and transaction-processing and monitoring fees of $2.9 million from Payment Services - Puerto Rico & Caribbean to Latin America Payments and Solutions.

(2)Primarily represents share-based compensation and severance payments.

(3)Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, and the elimination of unrealized earnings from equity investments.

(4)Represents non-cash unrealized gains (losses) on foreign currency remeasurement for assets and liabilities denominated in non-functional currencies.

Reconciliation of EBITDA to consolidated net income

The reconciliation of consolidated net income to EBITDA is as follows:

	Three months ended March 31,
(In thousands)	2024		2023
Net Income	$	16,387	$	30,063
Add:
Income tax expense	292		2,818
Interest expense, net	16,579		4,510
Depreciation and amortization	34,441		19,432
Total EBITDA	$	67,699	$	56,823

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Supplemental Statement of Cash Flows Information (Tables)

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of supplemental cash flow information

Supplemental statement of cash flows information is as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Supplemental disclosure of cash flow information:
Cash paid for interest	18,924	5,874
Cash paid for income taxes	4,250	6,119
Supplemental disclosure of non-cash activities:
Payable due to vendor related to equipment and software acquired	5,550	5,282
Accounts payable related to business acquisition	—	881
Right-of-use assets obtained in exchange for operating lease liabilities	2,693	—

Reconciliation of cash, cash equivalents, restricted cash and cash included in settlement assets as presented on the cash flow statement was as follows:

	Three months ended March 31,
(In thousands)	2024	2023
Cash and cash equivalents	293,666	114,201
Restricted cash	23,597	$	19,015
Cash and cash equivalents included in settlement assets	20,324	59,461
Cash, cash equivalents, restricted cash and cash included in settlement assets	337,587	192,677

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The Company and Basis of Presentation (Details)	Mar. 31, 2024 country
Accounting Policies [Abstract]
Number of countries where services are provided	26

XML

Business Acquisition - Additional Information (Details)	Nov. 01, 2023
Sinqia, S.A.
Business Acquisition [Line Items]
Percentage of shares acquired	100.00%

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Business Acquisition - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Nov. 01, 2023
Business Acquisition [Line Items]
Preliminary goodwill	$ 777,932	$ 791,700
Sinqia, S.A.
Business Acquisition [Line Items]
Cash and cash equivalents			$ 37,147
Restricted cash			2,166
Accounts receivable, net			9,989
Prepaid expenses and other assets			5,975
Property and equipment, net			3,618
Operating lease right-of-use asset			1,683
Preliminary goodwill			341,801
Equity securities, at fair value			9,035
Long-term deferred tax asset			28,758
Other intangible assets, net			291,048
Other long-term assets			5,455
Total assets acquired			736,675
Accounts payable			13,241
Accrued liabilities			40,775
Operating lease liability			4,114
Current portion of long-term debt			11,400
Long-term debt			57,492
Contract liability			7,356
Deferred tax liability			76,150
Other long-term liabilities			15,134
Total liabilities assumed			225,662
Redeemable noncontrolling interests			39,340
Additional paid-in capital			471,673
Total liabilities and equity			$ 736,675

XML

Business Acquisition - Intangible Assets Acquired (Details) - Sinqia, S.A. $ in Thousands	Nov. 01, 2023 USD ($)
Business Acquisition [Line Items]
Amount	$ 291,048
Weighted-average life	14 years
Customer relationships
Business Acquisition [Line Items]
Amount	$ 155,876
Weighted-average life	18 years
Trademark
Business Acquisition [Line Items]
Amount	$ 47,688
Weighted-average life	10 years
Software packages
Business Acquisition [Line Items]
Amount	$ 87,484
Weighted-average life	10 years

XML

Property and Equipment, net - Property and Equipment, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Property and Equipment, net
Property and equipment, gross	$ 208,077	$ 205,111
Less - accumulated depreciation and amortization	(148,817)	(144,117)
Depreciable assets, net	59,260	60,994
Land	1,517	1,459
Property and equipment, net	$ 60,777	62,453
Buildings
Property and Equipment, net
Useful life in years	30 years
Property and equipment, gross	$ 2,241	2,193
Data processing equipment
Property and Equipment, net
Property and equipment, gross	$ 190,519	187,761
Data processing equipment | Minimum
Property and Equipment, net
Useful life in years	3 years
Data processing equipment | Maximum
Property and Equipment, net
Useful life in years	5 years
Furniture and equipment
Property and Equipment, net
Property and equipment, gross	$ 10,481	10,281
Furniture and equipment | Minimum
Property and Equipment, net
Useful life in years	3 years
Furniture and equipment | Maximum
Property and Equipment, net
Useful life in years	20 years
Leasehold improvements
Property and Equipment, net
Property and equipment, gross	$ 4,836	$ 4,876
Leasehold improvements | Minimum
Property and Equipment, net
Useful life in years	5 years
Leasehold improvements | Maximum
Property and Equipment, net
Useful life in years	10 years

XML

Property and Equipment, net - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation and amortization expense related to property and equipment	$ 5.7	$ 5.0

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Goodwill and Other Intangible Assets - Goodwill by Segments (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Changes in the Carrying Amount of Goodwill
Beginning balance	$ 791,700
Adjustment to goodwill from prior year acquisition	(1,352)
Foreign currency translation adjustments	(12,416)
Ending balance	777,932
Payment Services - Puerto Rico & Caribbean
Changes in the Carrying Amount of Goodwill
Beginning balance	160,972
Adjustment to goodwill from prior year acquisition	0
Foreign currency translation adjustments	0
Ending balance	160,972
Latin America Payments and Solutions
Changes in the Carrying Amount of Goodwill
Beginning balance	452,597
Adjustment to goodwill from prior year acquisition	(1,352)
Foreign currency translation adjustments	(12,416)
Ending balance	438,829
Merchant Acquiring, net
Changes in the Carrying Amount of Goodwill
Beginning balance	138,121
Adjustment to goodwill from prior year acquisition	0
Foreign currency translation adjustments	0
Ending balance	138,121
Business Solutions
Changes in the Carrying Amount of Goodwill
Beginning balance	40,010
Adjustment to goodwill from prior year acquisition	0
Foreign currency translation adjustments	0
Ending balance	$ 40,010

XML

Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Goodwill
Impairment of goodwill	$ 0	$ 0
Amortization expense for intangible assets	$ 28,800,000	$ 16,300,000

XML

Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Acquired Finite-Lived Intangible Assets [Line Items]
Gross amount	$ 1,176,025	$ 1,175,120
Accumulated amortization	(685,837)	(657,050)
Net carrying amount	490,188	518,070
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Gross amount	563,127	568,284
Accumulated amortization	(357,752)	(340,952)
Net carrying amount	$ 205,375	$ 227,332
Customer relationships | Minimum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	8 years	8 years
Customer relationships | Maximum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	20 years	20 years
Trademarks
Acquired Finite-Lived Intangible Assets [Line Items]
Gross amount	$ 92,535	$ 94,203
Accumulated amortization	(44,085)	(41,319)
Net carrying amount	$ 48,450	$ 52,884
Trademarks | Minimum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	10 years	1 year
Trademarks | Maximum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	15 years	15 years
Software packages
Acquired Finite-Lived Intangible Assets [Line Items]
Gross amount	$ 518,676	$ 510,898
Accumulated amortization	(283,751)	(274,610)
Net carrying amount	$ 234,925	$ 236,288
Software packages | Minimum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	3 years	3 years
Software packages | Maximum
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	10 years	10 years
Non-compete agreement
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life in years	5 years	5 years
Gross amount	$ 1,687	$ 1,735
Accumulated amortization	(249)	(169)
Net carrying amount	$ 1,438	$ 1,566

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Goodwill and Other Intangible Assets - Estimated Amortization Expenses (Details) - Finite-Lived Intangible Assets, Excluding Assets Acquired in paySmart Acquisition $ in Thousands	Mar. 31, 2024 USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]
Remaining 2024	$ 78,146
2025	81,086
2026	68,499
2027	57,280
2028	46,758
Thereafter	$ 158,419

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Debt and Short-Term Borrowings - Total Debt (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Deferred consideration from Business Combinations	$ 18,860	$ 19,467
Revolving Facility	80,000	0
Total debt	1,071,635
Note Payable
Debt Instrument [Line Items]
Note payable due September 1, 2030	7,191	7,403
Term A due on December 1, 2027 | Credit Facility
Debt Instrument [Line Items]
2027 Term A Loan and 2030 Term B Loan bearing interest at a variable interest rate (SOFR plus applicable margin)	$ 443,736	449,450
Total debt		$ 997,553
Term A due on December 1, 2027 | Credit Facility | SOFR
Debt Instrument [Line Items]
Minimum variable rate floor	0.00%	0.00%
Applicable margin interest rate	2.00%	1.50%
Term B due on October 30, 2030 | Credit Facility
Debt Instrument [Line Items]
2027 Term A Loan and 2030 Term B Loan bearing interest at a variable interest rate (SOFR plus applicable margin)	$ 521,848	$ 521,233
Term B due on October 30, 2030 | Credit Facility | SOFR
Debt Instrument [Line Items]
Minimum variable rate floor	0.50%	0.50%
Applicable margin interest rate	3.50%	3.50%

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Debt and Short-Term Borrowings - Additional Information (Details)	1 Months Ended	3 Months Ended
	Sep. 30, 2023 USD ($)	Mar. 31, 2024 USD ($) derivative_instrument	Dec. 31, 2023 USD ($)	Mar. 31, 2023 USD ($)	Oct. 30, 2023 USD ($)	Dec. 01, 2022 USD ($)
Debt Instrument [Line Items]
Deferred consideration for business combinations		$ 18,900,000	$ 19,500,000
Derivative asset		6,962,000	4,385,000
Derivative liability		900,000	900,000
Gains (losses) reclassified from accumulated other comprehensive income (loss) into earnings		1,700,000		$ 1,000,000
Gains expected to be reclassified from accumulated other comprehensive loss into income in the next 12 months		$ 10,000,000
Minimum
Debt Instrument [Line Items]
Deferred consideration for business combinations, interest rate		2.00%
Maximum
Debt Instrument [Line Items]
Deferred consideration for business combinations, interest rate		24.00%
Level 2 | Fair Value, Recurring
Debt Instrument [Line Items]
Derivative asset		$ 6,962,000	4,385,000
Derivative liability		900,000	900,000
Level 2 | Fair Value, Recurring | Carrying Amount
Debt Instrument [Line Items]
Derivative asset		7,000,000	4,400,000
Derivative liability		$ 900,000	900,000
Interest Rate Swap
Debt Instrument [Line Items]
Number of interest rate swaps | derivative_instrument		4
Financing Agreement 2023
Debt Instrument [Line Items]
Note payable	$ 10,100,000	$ 7,200,000
Note Payable | Credit Agreement 2022
Debt Instrument [Line Items]
Interest rate	6.90%
Term A due on December 1, 2027 | Credit Facility | Credit Agreement 2022
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity						$ 415,000,000
Unpaid principal balance		447,500,000
Term A due on December 1, 2027 | Credit Facility | Credit Agreement October 2023
Debt Instrument [Line Items]
Line of credit facility, additional commitments					$ 60,000,000
Revolving Credit Facility | Credit Facility | Credit Agreement 2022
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity						$ 200,000,000
Unpaid principal balance		80,000,000
Additional borrowing capacity available under the revolving facility		114,000,000
Term B due on October 30, 2030 | Credit Facility | Credit Agreement 2022
Debt Instrument [Line Items]
Unpaid principal balance		$ 540,000,000
Term B due on October 30, 2030 | Credit Facility | Credit Agreement October 2023
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity					$ 600,000,000
Line of credit facility, repayments			$ 60,000,000

XML

Debt and Short-Term Borrowings - Summary of Interest Rate Swap Transaction (Details)	3 Months Ended
	Mar. 31, 2024 USD ($)
2018 Swap
Derivative [Line Items]
Notional Amount	$ 250,000,000
2018 Swap | 1-month SOFR
Derivative [Line Items]
Fixed Rate	2.929%
2023 Swap
Derivative [Line Items]
Notional Amount	$ 250,000,000
2023 Swap | 1-month SOFR
Derivative [Line Items]
Fixed Rate	3.375%
2024 Swap, 4.182% Fixed Rate
Derivative [Line Items]
Notional Amount	$ 150,000,000
2024 Swap, 4.182% Fixed Rate | 1-month SOFR
Derivative [Line Items]
Fixed Rate	4.182%
2024 Swap, 4.172% Fixed Rate
Derivative [Line Items]
Notional Amount	$ 150,000,000
2024 Swap, 4.172% Fixed Rate | 1-month SOFR
Derivative [Line Items]
Fixed Rate	4.172%

XML

Financial Instruments and Fair Value Measurements - Fair Value Measurements for Assets and Liabilities at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Financial assets:
Debt securities	$ 2,093	$ 2,095
Equity securities	10,843	9,413
Interest rate swaps	6,962	4,385
Financial liabilities:
Interest rate swaps	900	900
Fair Value, Recurring | Level 2
Financial assets:
Interest rate swaps	6,962	4,385
Financial liabilities:
Interest rate swaps	900	900
Fair Value, Recurring | Level 2 | Sinqia, S.A.
Financial assets:
Equity securities	0	6,447
Fair Value, Recurring | Level 2 | Debt securities
Financial assets:
Debt securities	2,093	2,095
Fair Value, Recurring | Level 3
Financial assets:
Interest rate swaps	0	0
Financial liabilities:
Interest rate swaps	0	0
Fair Value, Recurring | Level 3 | Sinqia, S.A.
Financial assets:
Equity securities	5,356	2,966
Fair Value, Recurring | Level 3 | Debt securities
Financial assets:
Debt securities	0	$ 0
Fair Value, Recurring | Measured at NAV | Sinqia, S.A.
Financial assets:
Equity securities	$ 5,487

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Financial Instruments and Fair Value Measurements - Additional Information (Details)	3 Months Ended
	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Purchase of available-for sale debt securities	$ 0	$ 0
Proceeds from maturities of available-for-sale debt securities	0	0
Proceeds from sale of available-for-sale debt securities	0	$ 0
Equity securities, at fair value	$ 10,843,000		$ 9,413,000
Level 3 | Sinqia, S.A. | Measurement Input, Revenue Multiple | Valuation, Enterprise Value | Minimum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity securities, measurement input	0.4
Level 3 | Sinqia, S.A. | Measurement Input, Revenue Multiple | Valuation, Enterprise Value | Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity securities, measurement input	8.3
Level 3 | Sinqia, S.A. | Fair Value, Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity securities, at fair value	$ 5,356,000		2,966,000
Level 2 | Sinqia, S.A. | Fair Value, Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Equity securities, at fair value	$ 0		$ 6,447,000

XML

Financial Instruments and Fair Value Measurements - Reconciliation of Level 3 Assets (Details) - Equity Securities $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2023	$ 2,966
Change in fair value of equity securities, recognized through Other income, net	2,353
Foreign currency translation adjustments	37
Balance at March 31, 2024	$ 5,356

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Financial Instruments and Fair Value Measurements - Carrying Value and Estimated Fair Values (Details) - Credit Facility - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Carrying Amount | Term A due on December 1, 2027
Financial liabilities:
Loan Facility	$ 443,736	$ 449,450
Carrying Amount | Term B due on October 30, 2030
Financial liabilities:
Loan Facility	521,848	521,240
Fair Value | Term A due on December 1, 2027
Financial liabilities:
Loan Facility	448,623	452,337
Fair Value | Term B due on October 30, 2030
Financial liabilities:
Loan Facility	$ 541,350	$ 539,325

XML

Redeemable Noncontrolling Interests - Summary of Terms (Details)	Mar. 31, 2024 BRL (R$)
Homie Do Brasil Informatica
Redeemable Noncontrolling Interest [Line Items]
Percentage of redeemable noncontrolling interest	40.00%
Rosk Software S.A.
Redeemable Noncontrolling Interest [Line Items]
Percentage of redeemable noncontrolling interest	49.00%
Compliasset Software e Solucoes Digitais LTDA.
Redeemable Noncontrolling Interest [Line Items]
Percentage of redeemable noncontrolling interest	40.00%
Lote45 Participacoes S.A.
Redeemable Noncontrolling Interest [Line Items]
Percentage of redeemable noncontrolling interest	48.00%
Redeemable noncontrolling interest, redemption value criteria, value subtracted from formula	R$ 10,000,000.0

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Redeemable Noncontrolling Interests - Changes in Redeemable Noncontrolling Interests (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Redeemable Noncontrolling Interest [Roll Forward]
Beginning Balance	$ 36,968
Net income from redeemable non-controlling interests	518
Adjustment of redeemable non-controlling interests to redemption value	3,172
Ending Balance	$ 40,658

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Equity - Changes in Accumulated Other Comprehensive Income (Loss) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Changes in Accumulated Other Comprehensive Income (Loss)
Beginning balance	$ 598,408
Other comprehensive income (loss) before reclassifications	(22,458)
Effective portion reclassified to net income	(1,673)
Ending balance	511,239
Foreign Currency Translation Adjustments
Changes in Accumulated Other Comprehensive Income (Loss)
Beginning balance	14,847
Other comprehensive income (loss) before reclassifications	(26,476)
Effective portion reclassified to net income	0
Ending balance	(11,629)
Cash Flow Hedges
Changes in Accumulated Other Comprehensive Income (Loss)
Beginning balance	3,336
Other comprehensive income (loss) before reclassifications	4,021
Effective portion reclassified to net income	(1,673)
Ending balance	5,684
Unrealized Gains (Losses) on Debt Securities AFS
Changes in Accumulated Other Comprehensive Income (Loss)
Beginning balance	26
Other comprehensive income (loss) before reclassifications	(3)
Effective portion reclassified to net income	0
Ending balance	23
Total
Changes in Accumulated Other Comprehensive Income (Loss)
Beginning balance	18,209
Ending balance	$ (5,922)

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Equity - Additional Information (Details) - USD ($)		3 Months Ended
	Mar. 08, 2024	Mar. 31, 2024	Mar. 31, 2023	Mar. 06, 2024	Dec. 31, 2023
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, authorized amount				$ 70,000,000
Common stock par value (in usd per share)		$ 0.01		$ 0.01	$ 0.01
Payment repurchase of common stock	$ 70,000,000	$ 70,000,000	$ 6,269,000
Common Stock
Equity, Class of Treasury Stock [Line Items]
Repurchase of common stock (in shares)	1,500,000	1,516,793	187,976

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Share-based Compensation - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expenses	$ 7.3	$ 5.6
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum unrecognized cost for stocks and RSU's	$ 64.0
Unrecognized compensation cost, weighted average period of recognition (in years)	2 years 6 months
Time Based Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)	3 years
Awards with Performance Conditions
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)	3 years
Performance adjustment percent	25.00%
Performance measurement period (in years)	1 year
Requisite service period (in years)	2 years
Awards with Performance Conditions | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance payout percent	0.00%
Awards with Performance Conditions | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance payout percent	200.00%

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Share-based Compensation - Nonvested Restricted Shares and RSUs Activity (Details) - Restricted Stock Units (RSUs)	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Shares
Beginning balance (in shares) | shares	1,799,012
Granted (in shares) | shares	1,097,178
Vested (in shares) | shares	(738,996)
Forfeited (in shares) | shares	(10,220)
Ending balance (in shares) | shares	2,146,974
Weighted-average grant date fair value
Beginning balance (in usd per share) | $ / shares	$ 39.42
Granted (in usd per share) | $ / shares	36.89
Vested (in usd per share) | $ / shares	36.92
Forfeited (in usd per share) | $ / shares	38.90
Ending balance (in usd per share) | $ / shares	$ 38.56

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Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation of Revenue [Line Items]
Revenues	$ 205,318	$ 159,814
Products and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues	3,064	2,454
Products and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues	202,254	157,360
Payment Services - Puerto Rico & Caribbean
Disaggregation of Revenue [Line Items]
Revenues	33,944	32,479
Payment Services - Puerto Rico & Caribbean | Products and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues	32	113
Payment Services - Puerto Rico & Caribbean | Products and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues	33,912	32,366
Latin America Payments and Solutions
Disaggregation of Revenue [Line Items]
Revenues	70,147	31,293
Latin America Payments and Solutions | Products and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues	557	614
Latin America Payments and Solutions | Products and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues	69,590	30,679
Merchant Acquiring, net
Disaggregation of Revenue [Line Items]
Revenues	43,099	40,347
Merchant Acquiring, net | Products and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues	0	0
Merchant Acquiring, net | Products and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues	43,099	40,347
Business Solutions
Disaggregation of Revenue [Line Items]
Revenues	58,128	55,695
Business Solutions | Products and services transferred at a point in time
Disaggregation of Revenue [Line Items]
Revenues	2,475	1,727
Business Solutions | Products and services transferred over time
Disaggregation of Revenue [Line Items]
Revenues	$ 55,653	$ 53,968

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Revenues - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Product Information [Line Items]
Accounts receivable, net	$ 141,332		$ 126,510
Contract liability	18,938		21,055
Contract liability - long term	52,062		$ 41,825
Revenue recognized that was included in unearned income	7,800	$ 4,400
Popular
Product Information [Line Items]
Accounts receivable, net	$ 49,300	$ 41,200
Total Revenue | Customer Concentration Risk | Popular
Product Information [Line Items]
Total percentage of revenues from Popular	31.00%	37.00%

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Revenues - Additional Information, Performance Obligation (Details) $ in Millions	Mar. 31, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Transaction price allocated to performance obligations that are unsatisfied or partially satisfied	$ 891.9
Professional Services, All Other Contracts | Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period of expected timing of satisfaction (in years)	1 year
Professional Services, All Other Contracts | Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, period of expected timing of satisfaction (in years)	6 years

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Revenues - Contract Balances (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Revenue, Contract Balances [Roll Forward]
Balance at beginning of period	$ 13,917	$ 4,749
Services transferred to customers	4,889	28,165
Transfers to accounts receivable	(5,568)	(18,997)
Balance at end of period	$ 13,238	$ 13,917

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Current Expected Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 4,010	$ 2,159
Current period provision for expected credit losses	378	2,218
Write-offs	(1,371)	(384)
Recoveries of amounts previously written-off	1	17
Balance at end of period	$ 3,018	$ 4,010

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Income Tax - Components of Income Tax Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Current tax provision	$ 6,012	$ 5,026
Deferred tax benefit	(5,720)	(2,208)
Income tax (benefit) expense	$ 292	$ 2,818

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Income Tax - Tax Expense Based on Location (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Current tax provision
Puerto Rico	$ 606	$ 1,180
United States	90	11
Foreign countries	5,316	3,835
Total current tax provision	6,012	5,026
Deferred tax benefit
Puerto Rico	(3,659)	(235)
United States	(9)	(26)
Foreign countries	(2,052)	(1,947)
Total deferred tax benefit	$ (5,720)	$ (2,208)

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Income Tax - Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Unremitted earnings from foreign subsidiaries	$ 139.8	$ 137.0
Gross deferred tax asset	71.1	65.4
Gross deferred tax liability	100.1	100.9
Gross deferred tax asset, valuation allowance	4.7	$ 4.6
Possible decrease in uncertain tax positions	$ 2.6

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Income Tax - Income Tax Expense Differs from Computed Income Tax at Statutory Rates (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Computed income tax at statutory rates	$ 6,260	$ 12,330
Differences in tax rates due to multiple jurisdictions	1,419	1,029
Effect of income subject to tax-exemption grant	(8,252)	(8,849)
Unrecognized tax expense	142	34
Excess tax benefits on share-based compensation	(526)	(91)
Tax credits for research and development activities	0	(884)
Other, net	1,249	(751)
Income tax (benefit) expense	$ 292	$ 2,818

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Net Income Per Common Share - Reconciliation of Income Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Earnings Per Share [Abstract]
Net income available to EVERTEC, Inc.’s common shareholders	$ 15,979	$ 30,052
Weighted average common shares outstanding (in shares)	65,179,965	64,968,298
Weighted average potential dilutive common shares (in shares)	1,156,714	640,320
Weighted average common shares outstanding - assuming dilution (in shares)	66,336,679	65,608,618
Net income per common share - basic (in usd per share)	$ 0.25	$ 0.46
Net income per common share - diluted (in usd per share)	$ 0.24	$ 0.46
Share awards excluded from the diluted earnings (loss) per share calculation because they would have an anti-dilutive effect (in shares)	400,000	400,000

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Net Income Per Common Share - Additional Information (Details) - $ / shares		3 Months Ended
	Feb. 15, 2024	Mar. 31, 2024	Mar. 31, 2023
Earnings Per Share [Abstract]
Cash dividends declared (in usd per share)	$ 0.05	$ 0.05	$ 0.05

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Segment Information - Operations by Segments (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($) segment	Mar. 31, 2023 USD ($)
Segment Reporting Information [Line Items]
Number of operating segments | segment	4
Revenues	$ 205,318	$ 159,814
Operating costs and expenses	172,515	119,724
Depreciation and amortization	34,441	19,432
Non-operating income (expenses)	455	(2,699)
EBITDA	67,699	56,823
Compensation and benefits	7,990	5,845
Transaction, refinancing and other	(1,968)	(397)
(Gain) loss on foreign currency remeasurement	4,456	4,864
Adjusted EBITDA	78,177	67,135
Payment Services - Puerto Rico & Caribbean
Segment Reporting Information [Line Items]
Revenues	33,944	32,479
Latin America Payments and Solutions
Segment Reporting Information [Line Items]
Revenues	70,147	31,293
Merchant Acquiring, net
Segment Reporting Information [Line Items]
Revenues	43,099	40,347
Business Solutions
Segment Reporting Information [Line Items]
Revenues	58,128	55,695
Operating Segments | Payment Services - Puerto Rico & Caribbean
Segment Reporting Information [Line Items]
Revenues	53,031	48,429
Operating costs and expenses	30,952	27,722
Depreciation and amortization	7,262	5,888
Non-operating income (expenses)	148	365
EBITDA	29,489	26,960
Compensation and benefits	698	528
Transaction, refinancing and other	267	292
(Gain) loss on foreign currency remeasurement	(102)	95
Adjusted EBITDA	30,352	27,875
Operating Segments | Latin America Payments and Solutions
Segment Reporting Information [Line Items]
Revenues	74,216	35,317
Operating costs and expenses	76,031	29,312
Depreciation and amortization	16,257	2,711
Non-operating income (expenses)	(1,165)	(3,785)
EBITDA	13,277	4,931
Compensation and benefits	1,498	652
Transaction, refinancing and other	(3,029)	0
(Gain) loss on foreign currency remeasurement	4,551	4,772
Adjusted EBITDA	16,297	10,355
Operating Segments | Merchant Acquiring, net
Segment Reporting Information [Line Items]
Revenues	43,099	40,347
Operating costs and expenses	28,819	26,689
Depreciation and amortization	1,233	1,129
Non-operating income (expenses)	0	307
EBITDA	15,513	15,094
Compensation and benefits	707	532
Transaction, refinancing and other	0	0
(Gain) loss on foreign currency remeasurement	0	0
Adjusted EBITDA	16,220	15,626
Operating Segments | Business Solutions
Segment Reporting Information [Line Items]
Revenues	58,128	55,695
Operating costs and expenses	40,451	38,913
Depreciation and amortization	4,438	4,488
Non-operating income (expenses)	139	532
EBITDA	22,254	21,802
Compensation and benefits	785	565
Transaction, refinancing and other	0	0
(Gain) loss on foreign currency remeasurement	0	0
Adjusted EBITDA	23,039	22,367
Corporate and Other
Segment Reporting Information [Line Items]
Revenues	(23,156)	(19,974)
Operating costs and expenses	(3,738)	(2,912)
Depreciation and amortization	5,251	5,216
Non-operating income (expenses)	1,333	(118)
EBITDA	(12,834)	(11,964)
Compensation and benefits	4,302	3,568
Transaction, refinancing and other	794	(689)
(Gain) loss on foreign currency remeasurement	7	(3)
Adjusted EBITDA	(7,731)	(9,088)
Payment Processing | Corporate and Other
Segment Reporting Information [Line Items]
Revenues	14,600	13,000
Software Sale and Developments | Corporate and Other
Segment Reporting Information [Line Items]
Revenues	4,100	4,000
Transaction Processing and Monitoring Fees | Corporate and Other
Segment Reporting Information [Line Items]
Revenues	$ 4,500	$ 2,900

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Segment Information - Income from Segments to Consolidated Net Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting [Abstract]
Net income	$ 16,387	$ 30,063
Add:
Income tax expense	292	2,818
Interest expense, net	16,579	4,510
Depreciation and amortization	34,441	19,432
Total EBITDA	$ 67,699	$ 56,823

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Supplemental Statement of Cash Flows Information - Supplemental Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Supplemental disclosure of cash flow information:
Cash paid for interest	$ 18,924	$ 5,874
Cash paid for income taxes	4,250	6,119
Supplemental disclosure of non-cash activities:
Payable due to vendor related to equipment and software acquired	5,550	5,282
Accounts payable related to business acquisition	0	881
Right-of-use assets obtained in exchange for operating lease liabilities	$ 2,693	$ 0

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Supplemental Statement of Cash Flows Information - Restricted Cash, and Cash Equivalents Reconciliation (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 293,666	$ 295,600	$ 114,201
Restricted cash	23,597	$ 23,073	19,015
Cash and cash equivalents included in settlement assets	20,324		59,461
Cash, cash equivalents, restricted cash and cash included in settlement assets	$ 337,587		$ 192,677

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Subsequent Events (Details) - $ / shares			3 Months Ended
	Apr. 18, 2024	Feb. 15, 2024	Mar. 31, 2024	Mar. 31, 2023
Subsequent Event [Line Items]
Cash dividends declared (in usd per share)		$ 0.05	$ 0.05	$ 0.05
Subsequent Event
Subsequent Event [Line Items]
Cash dividends declared (in usd per share)	$ 0.05