XML 37 R20.htm IDEA: XBRL DOCUMENT v3.24.1
DEBT
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
DEBT DEBT
Paycheck Protection Program Loan (“PPP Loan”)
In 2021, the Company received an aggregate of $3.6 million in loans pursuant to the Paycheck Protection Program (“PPP”) based on qualified spending, decreased quarterly revenue, and other factors. The Company received full forgiveness on $1.6 million of the PPP loan in November 2021, and the remaining $2.0 million balance in May 2022, which was recorded as a gain on forgiveness of the loan in the respective years.
Term Loan
On December 23, 2019, the Company, entered into a financing agreement with TCW for a $150.0 million term loan (the “Term Loan”) with a maturity date of December 23, 2024. Additionally, on the same day, the Company entered into a revolving credit facility (“TCW LOC”) with an aggregate principal amount not exceeding $15.0 million. The line of credit will terminate on December 23, 2024 and undrawn balances available under the revolving credit facility are subject to commitment fees of 1%. These facilities are guaranteed by the Company and are secured by substantially all of the assets of the Company. No amounts on the revolving credit facility have been drawn down as of December 31, 2023 and 2022, respectively.
The Term Loan has a stated interest rate of SOFR plus a specified premium (“Applicable Margin”) that ranges from 7.00% to 10.50% in accordance to the financing agreement. For the year ended December 31, 2023, the stated interest rate under the TCW Term Loan was SOFR + 8.50% and for the year ended December 31, 2022, the stated interest rate was based on SOFR with an Applicable Margin ranging from 8.50% to 10.50%.
On June 22, 2021, the Company entered into a fourth amendment to the Term Loan, which specifies that if Company does not secure $25.0 million in financing, or enter into a change of control agreement, by June 30, 2022 then the Mondee Stockholder must issue 3,600,000 Class G units to TCW. In connection with the fourth amendment and in consideration thereof, the Company incurred an amendment fee of $1.8 million, which was paid in kind (“PIK”) and added to the outstanding principal balance.

On December 31, 2021, the Company entered into a fifth amendment to the Term Loan to increase the Applicable Margin by 1% and capitalize interest during the period of October 1, 2021 to March 31, 2022. The PIK rate was increased to 12.25% beginning October 1, 2021. Additionally, quarterly installments for loan repayment were deferred until June 30, 2022. The modification is only in effect through June 30, 2022, at which time the Applicable Margin will revert to the original percentages.

On July 8, 2022, the Company entered into a seventh amendment to the Term Loan, pursuant to which, among other things, extended the June 30, 2022 quarterly repayment of interest and quarterly principal repayment to September 30, 2022, and Closing Date, respectively.

Additionally, the amendment modified the Applicable Margin for the period after the date of the consummation of the Business Combination. The relevant Applicable Margin shall be set at the respective level indicated for each fiscal quarter based upon the average daily balance of the outstanding Term Loan obligations during the immediately preceding fiscal quarter. However, from and after the first day of the first fiscal quarter following the 18 month anniversary of the consummation of the Business Combination (such date, the “18 Month Anniversary Date”), the Applicable Margin, with respect to the interest rate of (a) any reference rate loan or any portion thereof and (b) any LIBOR rate loan or any portion thereof, shall be set at the Applicable Margin Level in effect on the last day of the fiscal quarter during which such 18 Month Anniversary Date occurs.

Finally, the amendment stipulated the issuance of 3,000,000 Class G units of the Mondee Stockholder to TCW and a SPAC prepayment fee of 3% applied against the SPAC prepayment amount. The SPAC prepayment fee was due upon the consummation of the Business Combination.

On July 17, 2022, the Company entered into an amendment to the seventh amendment to the Term Loan, pursuant to which, among other things, TCW consented to reduce the amount of the loan required to be prepaid at closing to $40.0 million ("SPAC Prepayment"). On July 18, 2022, the consummation of the Business Combination occurred which resulted in the following:
a) SPAC Prepayment of $40.0 million
b) SPAC Prepayment Fee of $1.2 million
c) 3,000,000 Class G Units of the Mondee Stockholder issued at a per share price of $3.25
On October 24, 2022, the Company executed an eighth amendment to the Term Loan, pursuant to which, among other things, the amendment provides consent to a portion of the payment of the June Interest Payment at a rate per annum of up to 2.5% to be paid by capitalizing such interest and adding such capitalized interest to the then outstanding principal amount of the Term Loan (such amount, the “June PIK Amount” and the consent to permit the June PIK Amount the “June Interest Payment Condition”), (ii) waive the payment defaults, (iii) amend certain terms and conditions of the Financing Agreement.

On January 11, 2023, the Company executed a ninth Amendment to the Term Loan (the “Ninth Agreement”), wherein Wingspire Capital LLC (“Wingspire”) became a party to the to the Term Loan. The amendment resulted in the redesignation of $15.0 million under the Term Loan from other lenders to Wingspire (the “TCW Term Loan”). Concurrently, Wingspire funded an additional $15.0 million on top of the already outstanding Term Loan (the “Wingspire Term Loan”), with a total of $30.0 million contributed by Wingspire as part of this amendment. Further, pursuant to the ninth Amendment, Wingspire consented to take over the TCW LOC for a principal amount not to exceed $15.0 million. Both the TCW Term Loan and Wingspire Term Loan are referenced herein as the Term Loan.

Until January 11, 2024, the Company has the option to increase the Term Loan by $20.0 million under two conditions: (i) the Company must have a trailing 12-month EBITDA of at least $25.0 million; and (ii) the Company must draw in increments of at least $5.0 million. The Company did not exercise the option to increase the Wingspire Term Loan.

On January 31, 2023, the Company executed a tenth amendment to the Term Loan. The tenth amendment (1) set forth the terms on which we could acquire Orinter, pursuant to the Orinter Purchase Agreement, among us, Mondee Brazil, LLC, a Delaware limited liability company (“Mondee Brazil”), OTT Holdings Ltda. (“OTT Holdings”), Orinter, and the other parties named therein; (2) set forth the terms on which we could pay the earn-out payment contemplated to be paid to OTT Holdings and certain key executives of OTT Holdings pursuant to the Orinter Purchase Agreement; (3) required that Mondee Brazil join as a party to the TCW Agreement and the Security Agreement (as defined in the TCW Agreement); (4) required that Mondee, Inc. pledge 100% of the equity interests of Mondee Brazil; and (5) required that Mondee Brazil and Mondee Inc. pledge 100% of the equity interests of Orinter.

On October 13, 2023, the Company executed an eleventh amendment to the Term Loan (the “Eleventh Amendment”). The Eleventh Amendment (1) provided consent to the Company’s acquisitions of Interep, Consolid and Skypass; (2) required that the Company pledge 100% of the equity interests of Interep, Consolid and Skypass, and certain other subsidiaries; (3) specifies that certain leverage ratios, minimum unadjusted EBITDA and fixed charge coverage ratio covenants shall not be measured through the term of the TCW Agreement; (4) sets forth certain qualified cash requirements; (5) adds as an event of default the failure of the Company to achieve certain refinancing milestones; (6) provides that the revolving credit commitment shall be uncommitted and discretionary in nature; and (7) provides for the payment of certain fees. On November 2, 2023, the Company entered into a waiver with TCW Asset Management Company, Wingspire Capital LLC regarding the Term Loan which waived certain mandatory prepayment obligations of the Company.
For the year ended December 31, 2023, the stated interest rate under the TCW Term Loan was SOFR + 8.50% and for the year ended December 31, 2022, the stated interest rate was SOFR with an Applicable Margin ranging from 8.50% to 10.50%. In addition to the stated rate of interest on the Term Loan pursuant to which interest payments were calculated, debt issuance costs and debt discounts on the Term Loan are amortized over the term of the borrowing arrangement as additional notional interest expense, and added to the calculation of effective interest rate on the TCW Term Loan. Including such additional notional calculations, the effective interest rate on the Term Loan for the years ended December 31, 2023, and 2022 was 23.0% and 22.9%, respectively. The effective interest on the Wingspire Term Loan for the year ended December 31, 2023 is 17.1%. See table at the end of this Note for components of interest expense recognized in the years ended December 31, 2023 and 2022.

As of December 31, 2023, the estimated fair value of the Company’s TCW Term Loan was $149.0 million and the Wingspire Term Loan was $13.9 million. As of December 31, 2022, the estimated fair value of the Company’s Term Loan was $143.7 million. The fair value of debt was estimated based on Level 3 inputs.

The Term Loan includes provisions for customary events of default including non-payment of obligations, non-compliance with covenants and obligations, default on other material debt, bankruptcy or insolvency events, material judgments, change of control, and certain customary events of default relating to collateral or guarantees. Upon the occurrence of any event of default, subject to the terms of the Term Loan including any cure periods specified therein, customary remedies may be exercised by the Lenders under the Term Loan against the Company. The Company was in compliance with all of its financial covenants under the Term Loan as of December 31, 2023.

Subsequent December 31, 2023, the Company executed the twelfth and thirteenth amendments to the Term Loan, which extended the maturity on the Term Loan to March 31, 2025. Refer to Note 24 — Subsequent Events for further information about the amendments.
Orinter Short-term Loan

With partnering financing institutions in Brazil, the Company has the option to collect payments from travelers and travel agencies’ upfront or receive payments through scheduled installments. The Company is also able to collateralize the outstanding receivable balances with those financial institutions to make bank advances through financing agreements. The Company elects options based on the bank fee terms as part of its regular cash management process.

In December 2023, Orinter entered into a loan agreement (“Orinter short-term loan”) for €2.2 million with a maturity date of October 2024. All borrowings under the Orinter short-term loan bear interest at a rate of 6.7489%. Orinter’s receivables due from financial institutions comprising the outstanding balance serve as collateral on the loan. Interest expense for the Orinter short-term loan was immaterial for the year ended December 31, 2023. The Company was in compliance with all of its financial covenants under the Orinter short-term loan as of December 31, 2023.

The following table summarizes the Company's outstanding borrowing arrangements, excluding PPP and other governmental loans (in thousands):
As of December 31,
20232022
Term Loan$114,708 $106,250 
Payment in kind interest on Term Loan1
56,06346,518
Others2,57814
Total outstanding principal balance173,349152,782
Less: Unamortized debt issuance costs and discounts(11,842)(18,386)
Total debt161,507134,396
Less: Current portion of long-term debt(10,828)(7,514)
Long-term debt, net of current portion$150,679 $126,882 
1 Includes paid in kind amendment fee of $1.8 million.

The following table sets forth the total interest expense recognized related to the loans payable to lenders and other payment obligations mentioned above (in thousands):
Year ended December 31,
20232022
Cash interest expense$13,637 $10,903 
Payment in kind interest, net1
9,363 9,036 
LOC commitment charges152 152 
Amortization of debt issuance costs8,846 6,563 
$31,998 $26,654 
1Represents Payment in Kind Interest for the Company’s outstanding Term Loans, net of the reclassification of interest expense related to capitalized software development amounting to $0.2 million and $0.6 million for the years ended December 31, 2023 and 2022 respectively.

The Company incurred an additional $3.4 million of interest expense associated with Orinter and Interep’s operations for upfront collection of other receivables partnered with financing institutions. Interest expense paid out in cash for the year ended December 31, 2023 and 2022 was $17.2 million and $10.8 million.

The aggregate annual principal maturities of our Term Loan, Orinter short-term loan, and governmental loans for each of the next five years, based on contractual terms are listed in the table below (in thousands):
Year ending December 31, Borrowing ArrangementsGovernmental Loans
2024$10,828 $51 
2025162,521 21 
2026— 21 
2027— 21 
2028— 21 
Thereafter— 58 
$173,349 $193