CREDIT LINE AND OTHER BORROWINGS |
9 Months Ended |
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Sep. 30, 2022 | |
| Debt Disclosure [Abstract] | |
| CREDIT LINE AND OTHER BORROWINGS | CREDIT LINE AND OTHER BORROWINGS Credit Line:
On August 4, 2022, two wholly owned subsidiaries of the Company, Innovid LLC and TV Squared Inc, entered an amended and restated loan and security agreement with Silicon Valley Bank (the “2022 A&R Agreement”), to increase the revolving line of credit from $15,000 to $50,000 (the “New Revolving Credit Facility”). The interest for the New Revolving Credit Facility is payable monthly in arrears. The New Revolving Credit Facility bears interest at an annual rate equal to the greater of 4.25% and prime rate plus 0.75% on the outstanding principal of each credit extension. Additional fees include fees in an amount of 0.20% per annum of the average unused portion of the New Revolving Credit Facility to be paid quarterly in arrears. The Company will also pay non-refundable commitment fees of $40 and $75 at inception and first anniversary date, respectively. The maturity date of the 2022 A&R Agreement is June 30, 2024. The New Revolving Credit Facility is subject to certain customary conditions precedent to the credit extension as stated in the 2022 A&R Agreement.
The New Revolving Credit Facility requires the Company to comply with all covenants, primarily maintaining an adjusted quick ratio of at least 1.30 to 1.00. As defined in the 2022 A&R Agreement “adjusted quick ratio” is the ratio of (a) quick assets to (b) current liabilities minus the current portion of deferred revenue. “Quick assets” are determined as the Company’s unrestricted cash plus accounts receivable, net, and is determined according to US GAAP. The Company is also required to maintain the minimum quarterly adjusted EBITDA as defined in the 2022 A&R Agreement if the Company does not maintain the quarterly adjusted quick ratio of at least 1.50 to 1.00.
As of September 30, 2022 (unaudited), the Company is in compliance with all the covenants.
As of September 30, 2022 (unaudited), the Company utilized $15,000 of the $50,000 credit line, $6,000 of which was drawn during 2020 and $9,000 was drawn during the second quarter of 2022. Interest expenses are recognized in “Finance expenses (income), net”. See Note 9 for further details. FINANCE EXPENSES (INCOME), NETThe Company recognizes the gains and losses from the remeasurement of the warrants liability related to Public Warrants and Private Placement Warrants in “Finance expenses (income), net” in the condensed consolidated statements of operations. The unrealized (loss)/gain from changes in the fair value of the Company Warrants for the three months and nine months period ended September 30, 2022 (unaudited) was ($4,564) and $11,382, respectively.
The Company also recognized interest expenses in “Finance expenses (income), net” in the condensed consolidated statements of operations. Interest expenses for the three months ended September 30, 2022 (unaudited) and 2021 (unaudited) were $234 and $63, respectively. Interest expenses for the nine months ended September 30, 2022, and 2021 were $371 and $197, respectively.
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