...February 6, 2024 We view Ascensus' proposed $300 million incremental first-lien term loan issuance as leverage neutral and modestly accretive to cash flow. Proceeds of the fungible add-on will be used to repay debt on the company's higher interest-bearing second-lien term loan. The transaction will have a modestly favorable impact on the company's cash flow because it will save the company roughly $9 million-$10 million annually on cash interest payments while being leverage neutral. We expect Ascensus' free operating cash flow (FOCF) will modestly improve in 2024 and 2025. As of Sept. 30, 2023, year-to-date reported FOCF weakened to a $5 million deficit compared to positive $75 million in the same period of 2022 due to rising interest rates and the company's partially unhedged floating rate exposure. Nevertheless, we expect reported FOCF will improve to $54 million in 2024, and to $66 million in 2025 following the repayment of its more costly second-lien debt with proceeds from its proposed...
