PYXUS INTERNATIONAL, INC. 10-Q

Item 1. Financial Statements Pyxus International, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except per share data) Three months ended June 30, 2022 Three months ended June 30, 2021 Sales and other operating revenues $ 343,905 $ 333,290 Cost of goods and services sold 303,150 291,170 Gross profit 40,755 42,120 Selling, general, and administrative expenses 34,588 33,845 Other income, net 1,085 162 Restructuring and asset impairment charges 300 233 Operating income 6,952 8,204 Loss on deconsolidation/disposition of subsidiaries 599 — Interest expense, net 25,474 26,840 Loss before income taxes and other items ( 19,121 ) ( 18,636 ) Income tax benefit 867 8,439 Income (loss) from unconsolidated affiliates 3,749 ( 1,431 ) Net loss ( 14,505 ) ( 11,628 ) Net income (loss) attributable to noncontrolling interests 158 ( 120 ) Net loss attributable to Pyxus International, Inc. $ ( 14,663 ) $ ( 11,508 ) Loss per share: Basic and diluted $ ( 0.59 ) $ ( 0.46 ) Weighted average number of shares outstanding: Basic and diluted 25,000 25,000 See "Notes to Condensed Consolidated Financial Statements" -3- Pyxus International, Inc. and Subsidiaries Condensed Consolidated Statements of Comprehensive Loss (Unaudited) (in thousands) Three months ended June 30, 2022 Three months ended June 30, 2021 Net loss $ ( 14,505 ) $ ( 11,628 ) Other comprehensive (loss) income, net of tax: Foreign currency translation adjustment 947 689 Cash flow hedges ( 1,503 ) 4,328 Total other comprehensive (loss) income, net of tax ( 556 ) 5,017 Total comprehensive loss ( 15,061 ) ( 6,611 ) Comprehensive income (loss) attributable to noncontrolling interests 158 ( 120 ) Comprehensive loss attributable to Pyxus International, Inc. $ ( 15,219 ) $ ( 6,491 ) See "Notes to Condensed Consolidated Financial Statements" -4- Pyxus International, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) (in thousands) June 30, 2022 June 30, 2021 March 31, 2022 Assets Current assets Cash and cash equivalents $ 165,441 $ 79,593 $ 198,777 Restricted cash 9,495 2,538 2,148 Trade receivables, net 155,976 198,241 247,677 Other receivables 26,859 33,711 12,511 Inventories, net 980,070 854,042 749,427 Advances to tobacco suppliers, net 44,070 36,706 48,932 Recoverable income taxes 8,747 10,894 7,906 Prepaid expenses 44,513 35,217 34,817 Other current assets 16,672 19,713 25,452 Total current assets 1,451,843 1,270,655 1,327,647 Restricted cash — 389 389 Investments in unconsolidated affiliates 87,139 85,651 95,420 Goodwill — 36,853 — Other intangible assets, net 42,052 49,935 45,061 Deferred income taxes, net 8,871 10,179 6,498 Long-term recoverable income taxes 4,571 4,167 4,588 Other noncurrent assets 46,456 42,127 45,424 Right-of-use assets 35,636 41,540 35,979 Property, plant, and equipment, net 135,878 140,332 137,521 Total assets $ 1,812,446 $ 1,681,828 $ 1,698,527 Liabilities and Stockholders’ Equity Current liabilities Notes payable to banks $ 545,224 $ 403,792 $ 378,612 Accounts payable 144,915 88,807 179,012 Advances from customers 46,071 29,631 52,998 Accrued expenses and other current liabilities 91,054 91,426 82,239 Income taxes payable 6,729 4,110 5,592 Operating leases payable 8,535 8,961 8,065 Current portion of long-term debt 13,781 2,686 107,856 Total current liabilities 856,309 629,413 814,374 Long-term taxes payable 5,783 6,703 6,703 Long-term debt 678,777 669,793 580,477 Deferred income taxes 9,925 14,254 11,670 Liability for unrecognized tax benefits 12,173 15,883 14,401 Long-term leases 26,473 31,843 28,604 Pension, postretirement, and other long-term liabilities 59,748 66,610 60,927 Total liabilities 1,649,188 1,434,499 1,517,156 Commitments and contingencies Stockholders’ equity Common Stock— no par value: Authorized shares ( 250,000 for all periods) Issued shares ( 25,000 for all periods) 390,290 391,089 390,290 Retained deficit ( 233,476 ) ( 148,202 ) ( 218,813 ) Accumulated other comprehensive income (loss) 3,248 ( 1,716 ) 3,804 Total stockholders’ equity of Pyxus International, Inc. 160,062 241,171 175,281 Noncontrolling interests 3,196 6,158 6,090 Total stockholders’ equity 163,258 247,329 181,371 Total liabilities and stockholders’ equity $ 1,812,446 $ 1,681,828 $ 1,698,527 See "Notes to Condensed Consolidated Financial Statements" -5- Pyxus International, Inc. and Subsidiaries Condensed Statements of Consolidated Stockholders' Equity (Unaudited) Accumulated Other Comprehensive Income (Loss) (in thousands) Common Stock Retained Deficit Currency Translation Adjustment Pensions, Net of Tax Derivatives, Net of Tax Noncontrolling Interests Total Stockholders' Equity Balance, March 31, 2022 $ 390,290 $ ( 218,813 ) $ ( 8,873 ) $ 6,328 $ 6,349 $ 6,090 $ 181,371 Net loss attributable to Pyxus International, Inc. — ( 14,663 ) — — — 158 ( 14,505 ) Other — — — — — ( 3,052 ) ( 3,052 ) Other comprehensive loss, net of tax — — 947 — ( 1,503 ) — ( 556 ) Balance, June 30, 2022 $ 390,290 $ ( 233,476 ) $ ( 7,926 ) $ 6,328 $ 4,846 $ 3,196 $ 163,258 Balance, March 31, 2021 $ 391,089 $ ( 136,686 ) $ ( 4,649 ) $ 541 $ ( 2,625 ) $ 6,270 $ 253,940 Net loss attributable to Pyxus International, Inc. — ( 11,508 ) — — — ( 120 ) ( 11,628 ) Other — ( 8 ) — — — 8 — Other comprehensive income, net of tax — — 689 — 4,328 — 5,017 Balance, June 30, 2021 $ 391,089 $ ( 148,202 ) $ ( 3,960 ) $ 541 $ 1,703 $ 6,158 $ 247,329 See "Notes to Condensed Consolidated Financial Statements" -6- Pyxus International, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) (in thousands) Three months ended June 30, 2022 Three months ended June 30, 2021 Operating Activities: Net loss $ ( 14,505 ) $ ( 11,628 ) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization 5,929 4,066 Loss on deconsolidation/disposition of subsidiaries 599 — Debt amortization/interest 5,530 6,132 Loss on foreign currency transactions 39 1,325 Income from unconsolidated affiliates, net of dividends 7,773 10,567 Changes in operating assets and liabilities, net Trade and other receivables 26,612 ( 59,058 ) Inventories and advances to tobacco suppliers ( 228,994 ) ( 118,268 ) Deferred items ( 8,214 ) ( 3,643 ) Recoverable income taxes ( 796 ) ( 5,971 ) Payables and accrued expenses ( 25,249 ) ( 17,950 ) Advances from customers ( 6,997 ) 17,515 Prepaid expenses ( 6,027 ) ( 367 ) Income taxes 1,313 ( 4,320 ) Other operating assets and liabilities 3,396 118 Other, net ( 2,899 ) ( 4,475 ) Net cash used by operating activities ( 242,490 ) ( 185,957 ) Investing Activities: Purchases of property, plant, and equipment ( 2,210 ) ( 3,815 ) Collections on beneficial interests on securitized trade receivables 45,468 37,681 DIP loan to deconsolidated subsidiary — ( 5,229 ) Proceeds from settlement of debt claims from deconsolidated subsidiaries 2,011 — Other, net 1,766 1,017 Net cash provided by investing activities 47,035 29,654 Financing Activities: Net proceeds and repayments from short-term borrowings 170,419 29,015 Proceeds from DDTL facility — 117,600 Debt issuance costs ( 2,036 ) ( 6,148 ) Other, net 372 129 Net cash provided by financing activities 168,755 140,596 Effect of exchange rate changes on cash 322 514 Decrease in cash, cash equivalents, and restricted cash ( 26,378 ) ( 15,193 ) Cash and cash equivalents at beginning of period 198,777 92,705 Restricted cash at beginning of period 2,537 5,008 Cash, cash equivalents, and restricted cash at end of period $ 174,936 $ 82,520 Other information: Cash paid for income taxes, net $ 5,027 $ 4,871 Cash paid for interest, net 12,704 15,856 Noncash investing activities: Noncash amounts obtained as a beneficial interest in exchange for transferring trade receivables in a securitization transaction 29,033 38,498 See "Notes to Condensed Consolidated Financial Statements" -7- Pyxus International, Inc. and Subsidiaries Notes to Condensed Consolidated Financial Statements (in thousands, except per share data) Note 1 Basis of Presentation and Summary of Significant Accounting Policies 8 Note 2 New Accounting Standards 9 Note 3 Revenue Recognition 9 Note 4 Income Taxes 9 Note 5 Loss Per Share 10 Note 6 Inventories, Net 10 Note 7 CCAA Proceeding and Deconsolidation of Subsidiaries 11 Note 8 Equity Method Investments 11 Note 9 Variable Interest Entities 12 Note 10 Other Intangible Assets, Net 12 Note 11 Debt Arrangements 14 Note 12 Securitized Receivables 17 Note 13 Guarantees 18 Note 14 Derivative Financial Instruments 18 Note 15 Fair Value Measurements 19 Note 16 Pension and Other Postretirement Benefits 19 Note 17 Contingencies and Other Information 19 Note 18 Related Party Transactions 20 Note 19 Segment Information 21 Note 20 Subsequent Events 21 1. Basis of Presentation and Summary of Significant Accounting Policies The accompanying condensed consolidated financial statements represent the consolidation of Pyxus International, Inc. (the "Company", "Pyxus", "we", or "us") and all companies that Pyxus directly or indirectly controls, either through majority ownership or otherwise. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, the normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. Intercompany accounts and transactions have been eliminated. These condensed consolidated interim financial statements should be read in conjunction with the Company's consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended March 31, 2022 filed on June 14, 2022. Due to the seasonal nature of the Company’s business, the results of operations for a fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. Segment Information During the year ended March 31, 2022, the Company reevaluated its operating and reportable segments under Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 280 - Segment Reporting . As a result of this reevaluation, effective as of the fourth quarter of the fiscal year ended March 31, 2022, the Company has eight operating segments organized by geographic area and product category and are aggregated into one reportable segment for financial reporting purposes: Leaf. Based on our reevaluation, the Company concluded that the economic characteristics of our five Leaf region operations in North America, South America, Europe, Asia, and Africa were similar. Each geographic region derives its revenues mainly from shipping processed tobacco to manufacturers of cigarettes and other consumer tobacco products around the world, with a smaller percentage of revenue in each region being derived from performing third-party tobacco processing services. The three product category operating segments other than Leaf do not individually or in the aggregate meet the quantitative and qualitative thresholds to be individually reportable and have been combined and reported in the "All Other" category for purposes of reconciliation of respective balances for the Leaf segment to the condensed consolidated financial statements. Prior-period segment financial information has been revised to conform to the current-year presentation. See " Note 19. Segment Information " for additional information. -8- 2. New Accounting Standards Recently Adopted Accounting Pronouncements In November 2021, the FASB issued Accounting Standards Update ("ASU") No. 2021-10, Disclosures by Business Entities about Government Assistance . This ASU created ASC Topic 832, Government Assistance , and requires certain information be disclosed regarding assistance received from a government entity when either a grant or contribution accounting model is applied. The new disclosures are required for annual periods for transactions with a government entity that are within the scope of the Topic. The new disclosure guidance was adopted prospectively and became effective for the Company on April 1, 2022. The adoption of this new accounting standard is not expected to have a material impact on the Company's annual disclosures for fiscal year 2023. 3. Revenue Recognition Product revenue is primarily processed tobacco sold to the customer. Processing and other revenues are mainly contracts to process customer-owned green tobacco. During processing, ownership remains with the customers. All Other revenue is primarily composed of revenue from the sale of e-liquids and non-tobacco agriculture product revenue. The following disaggregates sales and other operating revenues by major source, with the All Other category being included for purposes of reconciliation of the respective balances below of the Leaf segment (the Company's sole reportable segment) to the condensed consolidated financial statements: Three months ended June 30, 2022 Three months ended June 30, 2021 Leaf: Product revenue $ 322,884 $ 311,741 Processing and other revenues 17,742 18,117 Total sales and other operating revenues 340,626 329,858 All Other: Total sales and other operating revenues 3,279 3,432 Total sales and other operating revenues $ 343,905 $ 333,290 The following summarizes activity in the allowance for expected credit losses: Three months ended June 30, 2022 Three months ended June 30, 2021 Balance, beginning of period $ ( 24,541 ) $ ( 20,900 ) Additions ( 165 ) ( 380 ) Write-offs 1,376 147 Balance, end of period ( 23,330 ) ( 21,133 ) Trade receivables 179,306 219,374 Trade receivables, net $ 155,976 $ 198,241 4. Income Taxes The Company's quarterly provision for income taxes has generally been calculated using the annual effective tax rate method ("AETR method"), which applies an estimated annual effective tax rate to pre-tax income or loss. The AETR method was used to calculate the provision for income taxes for the prior fiscal years, for which the Company reported income tax benefits in each prior reporting period. As of June 30, 2022, the AETR method produced an unreliable estimate of the Company’s annual effective tax rate; therefore, the Company recorded its interim income tax provision using the discrete method, as allowed under ASC 740-270, Income Taxes - Interim Reporting . Using the discrete method, the Company determined current and deferred income tax expense as if the three-month interim period of the current fiscal year were an annual period. The effective tax rate for the three months ended June 30, 2022 and 2021 was 4.5 % and 45.3 %, respectively. For the three months ended June 30, 2022 and 2021, the difference between the Company’s effective rate and the U.S. statutory rate of 21% is primarily due to the impact of net foreign exchange effects, non-deductible interest, and variations in the expected jurisdictional mix of earnings. -9- 5. Loss Per Share The following summarizes the computation of loss per share: Three months ended June 30, 2022 Three months ended June 30, 2021 Basic and diluted loss per share: Net loss attributable to Pyxus International, Inc. $ ( 14,663 ) $ ( 11,508 ) Shares: Weighted average number of shares outstanding 25,000 25,000 Basic and diluted loss per share $ ( 0.59 ) $ ( 0.46 ) 6. Inventories, Net The following summarizes the composition of inventories, net: June 30, 2022 June 30, 2021 March 31, 2022 Processed tobacco $ 646,539 $ 584,791 $ 517,613 Unprocessed tobacco 290,913 232,893 193,406 Other tobacco related 33,739 25,471 29,694 All Other 8,879 10,887 8,714 Total $ 980,070 $ 854,042 $ 749,427 -10- 7. CCAA Proceeding and Deconsolidation of Subsidiaries On January 21, 2021, Figr Norfolk Inc. ("Figr Norfolk"), Figr Brands, Inc. ("Figr Brands"), and Canada’s Island Garden Inc. ("Figr East," and together with Figr Norfolk and Figr Brands, the "Canadian Cannabis Subsidiaries"), which, prior to their sale, were indirect subsidiaries of the Company, applied for relief from their respective creditors pursuant to Canada’s Companies’ Creditors Arrangement Act (the "CCAA") in the Ontario Superior Court of Justice (Commercial List) (the "Canadian Court") in Ontario, Canada as Court File No. CV-21-00655373-00CL (the "CCAA Proceeding"). On January 21, 2021 (the "Order Date"), upon application by the Canadian Cannabis Subsidiaries, the Canadian Court issued an order for creditor protection of the Canadian Cannabis Subsidiaries pursuant to the provisions of the CCAA and the appointment of FTI Consulting Canada Inc. to serve as the Canadian Court-appointed monitor of the Canadian Cannabis Subsidiaries during the pendency of the CCAA Proceeding (the "Monitor"). The administration of the CCAA Proceeding, including the Canadian Court's appointment of the Monitor and the related authority of the Monitor, including approval rights with respect to significant actions of the Canadian Cannabis Subsidiaries during the pendency of the CCAA Proceeding, resulted in the Company losing control (in accordance with U.S. GAAP) of the Canadian Cannabis Subsidiaries at that time, and the deconsolidation on January 20, 2021 of the Canadian cannabis Subsidiaries' assets and liabilities and elimination of their equity components from the Company's consolidated financial statements as of January 21, 2021. Prior to the deconsolidation of the Canadian Cannabis Subsidiaries, they comprised an operating segment within the Other Products and Services reportable segment, which upon the Company's reevaluation of operating and reportable segments effective during the fourth quarter of the year ended March 31, 2022 is presented in the All Other category. Upon deconsolidation, the Company accounts for its investments in the Canadian Cannabis Subsidiaries using the cost method of accounting. On January 29, 2021, the Canadian Court issued an order permitting the Canadian Cannabis Subsidiaries to initiate a sale and investment solicitation process to be conducted by the Monitor and its affiliate to solicit interest in, and opportunities for, a sale of, or investment in, all or substantially all, or one or more components, of the assets and/or the business operations of the Canadian Cannabis Subsidiaries. On January 28, 2022, a sale of the assets of Figr Norfolk for a purchase price of Cdn.$ 5,000 was completed. On June 28, 2021, a sale of the outstanding equity of Figr East and certain intangible assets of Figr Brands for an aggregate purchase price of Cdn.$ 24,750 was completed. On February 2, 2022, Figr Norfolk and Figr Brands obtained approval to make cash distributions to their creditors pursuant to a distribution protocol approved by the Canadian Court. In the three months ended June 30, 2022, the Company received $ 2,011 in settlement of its debt claims with respect to the Canadian Cannabis Subsidiaries and did not receive any recovery with respect to its equity interest in the Canadian Cannabis Subsidiaries. On April 21, 2022, Figr Norfolk and Figr Brands obtained approval from the Canadian Court to terminate the CCAA Proceedings and commence bankruptcy proceedings under Canada's Bankruptcy and Insolvency Act (the "BIA Proceedings") to complete certain corporate and tax-related wind-up activities. On May 13, 2022, Figr Norfolk and Figr Brands commenced the BIA Proceedings. On June 13, 2022, the CCAA Proceedings were formally terminated. Related Party Relationship The commencement of the CCAA Proceeding, the appointment of the Monitor, and the subsequent deconsolidation of the Canadian Cannabis Subsidiaries results in transactions with the Canadian Cannabis Subsidiaries no longer being eliminated in consolidation. As such, transactions between the Company and the Canadian Cannabis Subsidiaries, including loans under the debtor-in-possession financing facility (the "Canadian DIP Facility") from another non-U.S. subsidiary of Pyxus (the "DIP Lender") provided during the pendency of the CCAA Proceedings, which were fully repaid on July 8, 2021, are treated as related party transactions. See " Note 18. Related Party Transactions " for transactions between the Company and the Canadian Cannabis Subsidiaries. 8. Equity Method Investments The following summarizes the Company's equity method investments as of June 30, 2022: Investee Name Location Primary Purpose The Company's Ownership Percentage Basis Difference Adams International Ltd. Thailand purchase and process tobacco 49 % $ ( 4,526 ) Alliance One Industries India Private Ltd. India purchase and process tobacco 49 % ( 5,770 ) China Brasil Tobacos Exportadora SA Brazil purchase and process tobacco 49 % 45,124 Oryantal Tütün Paketleme Sanayi ve Ticaret A.Ş. Turkey process tobacco 50 % ( 416 ) Purilum, LLC U.S. produce flavor formulations and consumable e-liquids 50 % 4,589 Siam Tobacco Export Company Thailand purchase and process tobacco 49 % ( 6,098 ) -11- The following summarizes financial information for these equity method investments: Operations statement: Three months ended June 30, 2022 Three months ended June 30, 2021 Sales $ 69,382 $ 31,432 Gross profit 14,089 3,666 Net income 8,330 ( 2,900 ) Company's dividends received 11,522 8,848 Balance sheet: June 30, 2022 June 30, 2021 March 31, 2022 Current assets $ 441,973 $ 290,750 $ 375,015 Property, plant, and equipment and other assets 37,876 45,068 42,841 Current liabilities 367,743 228,716 289,816 Long-term obligations and other liabilities 2,249 3,400 2,999 9. Variable Interest Entities The Company holds variable interests in multiple entities that primarily procure or process inventory or are securitization entities. These variable interests relate to equity investments, receivables, guarantees, and securitized receivables. The following summarizes the Company's financial relationships with its unconsolidated variable interest entities: June 30, 2022 June 30, 2021 March 31, 2022 Investments in variable interest entities $ 80,446 $ 78,903 $ 88,118 Receivables with variable interest entities 16,825 19,671 2,211 Guaranteed amounts to variable interest entities (not to exceed) 64,610 55,987 55,884 10. Other Intangible Assets, Net The following summarizes the changes in the Company's goodwill and other intangible assets, net: Three months ended June 30, 2022 Weighted Average Remaining Useful Life Beginning Carrying Amount, Net Amortization Expense Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 10.17 years $ 23,568 $ ( 1,455 ) $ 22,113 Technology 5.82 years 11,471 ( 1,352 ) 10,119 Trade names 12.17 years 10,022 ( 202 ) 9,820 Total $ 45,061 $ ( 3,009 ) $ 42,052 -12- Year ended March 31, 2022 Weighted Average Remaining Useful Life Beginning Carrying Amount, Net Additions Amortization Expense Disposition of Humble Juice Impairment Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 10.30 years $ 27,730 $ — $ ( 2,427 ) $ ( 1,735 ) $ — $ 23,568 Technology 5.80 years 12,858 840 ( 2,227 ) — — 11,471 Trade names 12.42 years 10,829 — ( 807 ) — — 10,022 Intangibles not subject to amortization: Goodwill 36,853 — — ( 4,667 ) ( 32,186 ) — Total $ 88,270 $ 840 $ ( 5,461 ) $ ( 6,402 ) $ ( 32,186 ) $ 45,061 -13- 11. Debt Arrangements The following summarizes debt and notes payable: June 30, June 30, March 31, (in thousands) Interest Rate 2022 2021 2022 Senior secured credit facilities: ABL Credit Facility 3.5 % (1) $ 90,000 $ — $ 90,000 Exit ABL Credit Facility 5.8 % (1) — 67,500 — DDTL Facility (2) 10.7 % (1) 109,751 117,353 107,832 Senior secured notes: 10.0 % senior secured first lien notes (3) 10.0 % 271,678 268,168 270,762 Exit Term Loan Credit Facility (4) 9.6 % (1) 220,518 216,533 219,500 Other long-term debt 1.9 % (1) 611 2,925 239 Notes payable to banks (5) 5.8 % (1) 545,224 403,792 378,612 Total debt $ 1,237,782 $ 1,076,271 $ 1,066,945 Short-term (5) $ 545,224 $ 403,792 $ 378,612 Long-term: Current portion of long-term debt $ 13,781 $ 2,686 $ 107,856 Long-term debt 678,777 669,793 580,477 $ 692,558 $ 672,479 $ 688,333 Letters of credit $ 14,430 $ 4,804 $ 9,038 (1) Weighted average rate for the trailing twelve months ended June 30, 2022. As the ABL Credit Facility has not been outstanding for a trailing twelve-month period, the interest rate is the weighted average rate from inception through June 30, 2022. (2) Balance of $ 109,751 is net of original issue discount of $ 499 . Total repayment will be $ 110,250 , which includes a $ 5,250 exit fee payable upon repayment. (3) Balance of $ 271,678 is net of original issue discount of $ 9,166 . Total repayment will be $ 280,844 . (4) The aggregate balance of the Term Loan Credit Facility of $ 220,518 includes $ 5,436 of accrued paid-in-kind interest. (5) Primarily foreign seasonal lines of credit. ABL Credit Facility On February 8, 2022, Pyxus Holdings, certain subsidiaries of Pyxus Holdings (together with Pyxus Holdings, the "Borrowers"), and the Company and its wholly owned subsidiary, Pyxus Parent, Inc., as parent guarantors, entered into an ABL Credit Agreement (the "ABL Credit Agreement"), dated as of February 8, 2022, by and among Pyxus Holdings, as Borrower Agent, the Borrowers and parent guarantors party thereto, the lenders party thereto, and PNC Bank, National Association, as Administrative Agent and Collateral Agent, to establish an asset-based revolving credit facility (the "ABL Credit Facility"), the proceeds of which may be used to refinance existing senior bank debt, pay fees and expenses related to the ABL Credit Facility, partially fund capital expenditures, and provide for the ongoing working capital needs of the Borrowers. The ABL Credit Facility may be used for revolving credit loans and letters of credit from time to time up to an initial maximum principal amount of $ 100,000 , subject to the limitations described below in this paragraph. The ABL Credit Facility includes a $ 20,000 uncommitted accordion feature that permits Pyxus Holdings, under certain conditions, to solicit the lenders under the ABL Credit Facility to provide additional revolving loan commitments to increase the aggregate amount of the revolving loan commitments under the ABL Credit Facility not to exceed a maximum principal amount of $ 120,000 . A detailed description of the ABL Credit Agreement is included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022. At June 30, 2022, Pyxus Holdings was in compliance with the covenants under the ABL Credit Agreement. Exit ABL Credit Facility On August 24, 2020, Pyxus Holdings entered into the Exit ABL Credit Agreement to establish the Exit ABL Credit Facility. The Exit ABL Credit Facility may be used for revolving credit loans and letters of credit from time to time up to an initial maximum principal amount o f $ 75,000 , subject to certain limitations. On February 8, 2022, Pyxus Holdings terminated the Exit ABL Credit Agreement and repaid $ 56,500 outstanding thereunder with proceeds from the initial borrowing under the ABL Credit Facility. -14- DDTL Facility On April 23, 2021, Intabex Netherlands B.V. ("Intabex"), an indirect wholly owned subsidiary of the Company, entered into a Term Loan Credit Agreement (the "DDTL Facility Credit Agreement"), dated as of April 23, 2021 (the "Closing Date"), by and among (i) Intabex, as borrower, (ii) the Company, Pyxus Parent, Inc., Pyxus Holdings, Inc., Alliance One International, LLC, Alliance One International Holdings, Ltd, as guarantors (collectively, the "Parent Guarantors"), (iii) certain funds managed by Glendon Capital Management, L.P. and Monarch Alternative Capital LP, as lenders (collectively and, together with any other lender that is or becomes a party thereto as a lender, the "DDTL Facility Lenders"), and (iv) Alter Domus (US) LLC, as administrative agent and collateral agent (the "DDTL Agent"). The DDTL Facility Credit Agreement established a $ 120,000 delayed-draw term loan credit facility (the "DDTL Facility") under which the full amount has been drawn (the "DDTL Loans"). After that date, a fund managed by Owl Creek Asset Management, L.P. became a lender under the DDTL Facility. The proceeds of the DDTL Loans were used to provide working capital and for other general corporate purposes of Intabex, the Guarantors (as defined below) and their subsidiaries. The obligations of Intabex under the DDTL Facility Credit Agreement (and certain related obligations) are (a) guaranteed by the Parent Guarantors and Alliance One International Tabak B.V., an indirect subsidiary of the Company, and each of the Company’s domestic and foreign subsidiaries that is or becomes a guarantor of borrowings under the Term Loan Credit Agreement (which subsidiaries are referred to collectively, together with the Parent Guarantors, as the "Guarantors"), and (b) are secured by the pledge of all of the outstanding equity interests of (i) Alliance One Brasil Exportadora de Tabacos Ltda. ("AO Brazil"), which principally operates the Company’s leaf tobacco operations in Brazil, and (ii) Alliance One International Tabak B.V., which owns a 0.001 % interest of AO Brazil. A detailed description of the DDTL Facility Credit Agreement is included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022. At June 30, 2022, Intabex and each Guarantor was in compliance with the covenants under the DDTL Facility Credit Agreement. As described below, the DDTL Facility Credit Agreement was amended and restated on July 28, 2022. The portion of the DDTL Facility that was refinanced on a long-term basis, effective July 28, 2022, is classified as noncurrent and recorded in Long-term debt within the condensed consolidated balance sheet as of June 30, 2022. Amendment and Restatement of DDTL Facility Credit Agreement On June 2, 2022, Intabex, the Company and the Guarantors entered into an Amendment and Restatement Agreement dated as of June 2, 2022 (the "Amendment and Restatement Agreement") with the DDTL Facility Lenders and the DDTL Agent to, subject to the satisfaction of customary closing conditions, amend and restate the DDTL Facility Credit Agreement as set forth in the form of an Amended and Restated Term Loan Credit Agreement (the "Amended Credit Agreement"), appended to the Amendment and Restatement Agreement, among (i) Intabex, as borrower, (ii) the Company and the Guarantors, (iii) the DDTL Facility Lenders and any other lender that becomes a party thereto (collectively, the "Term Loan Lenders"), and (iv) the DDTL Agent, as administrative agent and collateral agent. On July 28, 2022, following the satisfaction of the conditions to effectiveness specified in the Amendment and Restatement Agreement, the amendment and restatement of the DDTL Facility Credit Agreement by the Amended Credit Agreement became effective. See " Note 20. Subsequent Events " for additional information. The Amended Credit Agreement establishes a $ 100,000 term loan credit facility (the "Term Loan Facility") and requires that Intabex use the net proceeds of the loans made thereunder (the "Term Loans") and other funds to repay in full its obligations under the DDTL Facility Credit Agreement, including the outstanding principal of, and accrued and unpaid interest on, borrowings under the DDTL Facility on the Amendment and Restatement Effectiveness Date and the payment of fees and expenses incurred in connection with repaying such borrowings and entering into the Amended Credit Agreement. The Term Loans mature on December 2, 2023. The Amended Credit Agreement provides that the Term Loans may be prepaid at any time, with a 2.0 % fee due with respect to any principal payment made after the one-year anniversary of the Amendment and Restatement Effectiveness Date, including a payment made at maturity. The Amended Credit Agreement further provides that amounts of principal that are prepaid may not be reborrowed under the Term Loan Facility. Under the Amended Credit Agreement, interest on the outstanding principal amount of the Term Loans accrues at an annual rate of SOFR plus 7.5 %, subject to a SOFR floor of 1.0 %, for "SOFR loans" or, for loans that are not SOFR loans, at an annual rate of an alternate base rate (as specified in the Amended Credit Agreement and subject to a specified floor) plus 6.5 %. Interest is to be paid in arrears in cash upon prepayment, acceleration, maturity, and on the last day of each interest period (which may be one, three or six months) for SOFR loans and on the last day of each calendar quarter for loans that are not SOFR loans. Pursuant to the Amended Credit Agreement, the Term Loan Lenders received on the Amendment and Restatement Effectiveness Date a non-refundable commitment fee equal to 3.0 % of the aggregate commitments under the Term Loan Facility and a closing fee equal to 1.0 % of the aggregate commitments under the Term Loan Facility, as original issue discount. -15- Under the Amended Credit Agreement, the obligations of Intabex under the Amended Credit Agreement (and certain related obligations) continue to be guaranteed and secured by the same guarantors of, and the same collateral securing, Intabex’s obligations under the DDTL Facility Credit Agreement. Related Party Transactions Based on a Schedule 13D filed with the SEC on September 3, 2020 by Glendon Capital Management, L.P. (the "Glendon Investor"), Glendon Opportunities Fund, L.P. and Glendon Opportunities Fund II, L.P., the Glendon Investor reported beneficial ownership of 7,939 shares of the Company’s common stock, representing approximately 31.8 % of the outstanding shares of the Company’s common stock. Based on Form 4 filed with the SEC on July 15, 2021, as well as a Schedule 13D filed with the SEC on September 3, 2020 by Monarch Alternative Capital LP (the "Monarch Investor"), MDRA GP LP and Monarch GP LLC, the Monarch Investor reported beneficial ownership of 6,140 shares of the Company’s common stock, representing approximately 24.6 % of the outstanding shares of the Company’s common stock. Based on a Schedule 13G/A filed with the SEC on February 10, 2022 by Owl Creek Asset Management, L.P. and Jeffrey A. Altman, Owl Creek Asset Management, L.P. is the investment manager of certain funds and reported beneficial ownership of 2,405 shares of the Company’s common stock on December 31, 2021, representing approximately 9.6 % of the outstanding shares of the Company’s common stock. Pursuant to the Shareholders Agreement, Holly Kim and Patrick Fallon were designated to serve as directors of Pyxus and each continues to serve as a director of Pyxus. Ms. Kim is a Partner at Glendon Capital Management, L.P. and Mr. Fallon is a Managing Principal at Monarch Alternative Capital LP. The DDTL Facility Credit Agreement, the Amendment and Restatement Agreement, the Amended Credit Agreement and any and all borrowings under the DDTL Facility Credit Agreement and the Amended Credit Agreement and the guaranty transactions described above were approved, and determined to be on terms and conditions at least as favorable to the Company and its subsidiaries as could reasonably have been obtained in a comparable arm’s-length transaction with an unaffiliated party, by a majority of the disinterested members of the Board of Directors of Pyxus. Senior Secured First Lien Notes On the August 24, 2020, Pyxus Holdings issued approximately $ 280,844 in aggregate principal amount of the Notes to holders of Allowed First Lien Notes Claims pursuant to the Indenture dated as of August 24, 2020 (the "Indenture") among Pyxus Holdings, the initial guarantors party thereto, and Wilmington Trust, National Association, as trustee and collateral agent. A detailed description of the Notes and the Indenture is included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022. At June 30, 2022, Pyxus Holdings was in compliance with the covenants under the Indenture. Exit Term Loan Credit Facility On August 24, 2020, Pyxus Holdings entered into the Exit Term Loan Credit Agreement by and among, amongst others, Pyxus Holdings, certain lenders party thereto and Alter Domus (US) LLC, as administrative agent and collateral agent to establish the Exit Term Loan Credit Facility in an aggregate principal amount of approximately $ 213,418 . The aggregate principal amount of loans outstanding under Debtors’ debtor-in-possession financing facility, and related fees, was converted into, or otherwise satisfied with the proceeds of, the Exit Term Loan Credit Facility. A detailed description of the Exit Term Loan Credit Agreement and Exit Term Loan Credit Facility is included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022. At June 30, 2022, Pyxus Holdings was in compliance with the covenants under the Exit Term Loan Credit Agreement. Short-Term Seasonal Lines of Credit Excluding all long-term credit agreements, the Company has typically financed its non-U.S. operations with uncommitted short-term seasonal lines of credit arrangements with a number of banks. These operating lines are generally seasonal in nature, typically extending for a term of 180 to 270 days corresponding to the tobacco crop cycle in that location. These facilities are typically uncommitted in that the lenders have the right to cease making loans and demand repayment of loans at any time. These loans are typically renewed at the outset of each tobacco season. Certain of the foreign seasonal lines of credit are secured by trade receivables and inventories as collateral. African Lines of Credit On June 30, 2022, the Company and certain subsidiaries of the Company, including the Company’s subsidiaries in Malawi, Tanzania and Zambia (the "African Subsidiary Borrowers"), entered into the Fourth Amendment and Restatement Agreement dated as of June 27, 2022 (the "Restated TDB Agreement") with Eastern and Southern African Trade and Development Bank ("TDB") to amend and restate the Third Amendment and Restatement Agreement dated August 12, 2021 among them. The Restated TDB Agreement sets forth the terms that govern the foreign seasonal lines of credit of each of the African Subsidiary Borrowers with TDB and supersedes the prior terms in effect. The Restated TDB Agreement provides for a lending commitment with respect to the line of credit of the Company’s Malawi subsidiary of $ 100,000 , a lending commitment with respect to the line of credit of the Company’s Tanzania subsidiary of $ 70,000 , and a lending commitment with respect to the line of credit of the Company’s Zambia subsidiary of $ 15,000 , in each case with current borrowing availability reduced by the -16- amount of outstanding loans borrowed under the respective prior-existing line of credit with TDB. The prior-existing outstanding loans under the Restated TDB Agreement bear interest at LIBOR plus 6.0 % and new loans made under the Restated TDB Agreement bear interest at LIBOR plus 5.5 %. The Restated TDB Agreement terminates on June 30, 2024, unless terminated sooner at TDB’s discretion on June 30, 2023. The terms of the Restated TDB Agreement may also be modified at TDB’s discretion on that date. Borrowings under the Restated TDB Agreement are due upon the termination of the Restated TDB Agreement. Pursuant to the Restated TDB Agreement, each of the Company and its subsidiaries, Pyxus Parent, Inc. and Pyxus Holdings, Inc., guarantee the obligations of the African Subsidiary Borrowers under the Restated TDB Agreement. In addition, the Restated TDB Agreement provides that obligations of each African Subsidiary Borrower under the Restated TDB Agreement are secured by a first priority pledge of: • tobacco purchased by that African Subsidiary Borrower that is financed by TDB; • intercompany receivables arising from the sale of the tobacco financed by TDB; • customer receivables arising from the sale of the tobacco financed by TDB; and • such African Subsidiary Borrower’s local collection account receiving customer payments for purchases of tobacco financed by TDB. The Restated TDB Agreement also requires Alliance One International, LLC, a subsidiary of the Company, to pledge customer receivables arising from the sale of the tobacco financed by TDB and pledge its collection accounts designated for receiving customer payments for purchases of tobacco financed by TDB. The Restated TDB Agreement contains affirmative and negative covenants (subject, in each case, to customary and other exceptions and qualifications), including covenants that limit the ability of the African Subsidiary Borrowers to, among other things: • Grant liens on assets; • Incur additional indebtedness (including guarantees and other contingent obligations); • Sell or otherwise dispose of property or assets; • Maintain a specified amount of pledged accounts receivable and inventory; • Make changes in the nature of its business; • Enter into burdensome contracts; and • Effect certain modifications or terminations of customer contracts. The Restated TDB Agreement contains events of default including, but not limited to, nonpayment of principal or interest, violation of covenants, breaches of representations and warranties, cross-default to other debt, bankruptcy and other insolvency events, invalidity of loan documentation, certain changes of control of the Company and the other loan parties, termination of material licenses and material adverse changes. At June 30, 2022, the Company and its subsidiaries party to the Restated TDB Agreement were in compliance with all such covenants under the Restated TDB Agreement and $ 55,642 was available for borrowing under the Restated TDB Agreement, after reducing availability by the aggregate borrowings under the Restated TDB Agreement of $ 129,358 outstanding on that date. 12. Securitized Receivables The Company sells trade receivables to unaffiliated financial institutions under three accounts receivable securitization facilities, which are subject to annual renewal. Under the first facility, the Company continuously sells a designated pool of trade receivables to a special purpose entity, which sells 100 % of the receivables to an unaffiliated financial institution. As of June 30, 2022, the investment limit of this facility was $ 100,000 of trade receivables. For the other facilities, the Company offers trade receivables for sale to an unaffiliated financial institution, which are then subject to acceptance by the unaffiliated financial institution. As of June 30, 2022, the investment limit under the second facility was $ 80,000 of trade receivables. As of June 30, 2022, the investment limit under the third facility was variable based on qualifying sales. As the servicer of the first and second facilities, the Company may receive funds that are due to the unaffiliated financial institutions, which are net settled on the next settlement date. As of June 30, 2022 and 2021, and March 31, 2022, trade -17- receivables, net in the condensed consolidated balance sheets has been reduced by $ 14,893 , $ 4,724 , and $ 1,872 as a result of the net settlement, respectively. Refer to " Note 15. Fair Value Measurements " for additional information. The following summarizes the accounts receivable securitization information: June 30, 2022 June 30, 2021 March 31, 2022 Receivables outstanding in facility $ 179,761 $ 66,671 $ 131,092 Beneficial interests 22,762 20,271 28,072 Three months ended June 30, 2022 Three months ended June 30, 2021 Cash proceeds for the period ended: Cash purchase price $ 153,449 $ 90,012 Deferred purchase price 45,468 37,681 Total $ 198,917 $ 127,693 13. Guarantees In certain markets, the Company guarantees bank loans for suppliers to finance their crops. The Company also guarantees bank loans of certain unconsolidated subsidiaries. The following summarizes amounts guaranteed and the fair value of those guarantees: June 30, 2022 June 30, 2021 March 31, 2022 Amounts guaranteed (not to exceed) $ 118,615 $ 95,272 $ 114,208 Amounts outstanding under guarantee (1) 45,552 32,461 49,413 Fair value of guarantees 2,601 1,962 2,956 Amounts due to local banks on behalf of suppliers for government subsidized rural credit financing 6,376 12,216 15,781 (1) Most of the guarantees outstanding at June 30, 2022 expire within one year . 14. Derivative Financial Instruments The Company uses forward or option currency contracts to manage risks associated with foreign currency exchange rates on foreign operations. These contracts are for green tobacco purchases, processing costs, and selling, general, and administrative expenses. The Company recorded a net gain of $ 862 and $ 415 from its derivative financial instruments in cost of goods and services sold for the three months ended June 30, 2022 and 2021, respectively. As of June 30, 2022 and 2021, the Company recorded current derivative assets of $ 560 and $ 4,896 within other current assets, respectively. The U.S. Dollar notional amount of derivative contracts outstanding as of June 30, 2022 and 2021 was $ 7,259 and $ 53,436 , respectively. -18- 15. Fair Value Measurements The following summarizes the financial assets and liabilities measured at fair value on a recurring basis: June 30, 2022 June 30, 2021 March 31, 2022 Total Total Total Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Financial Assets: Derivative financial instruments $ 560 $ — $ 560 $ 4,896 $ — $ 4,896 $ 9,867 $ — $ 9,867 Securitized beneficial interests — 22,762 22,762 — 20,271 20,271 — 28,072 28,072 Total assets $ 560 $ 22,762 $ 23,322 $ 4,896 $ 20,271 $ 25,167 $ 9,867 $ 28,072 $ 37,939 Financial Liabilities: Long-term debt $ 430,573 $ 660 $ 431,233 $ 450,724 $ 3,164 $ 453,888 $ 447,843 $ 246 $ 448,089 Guarantees — 2,601 2,601 — 1,962 1,962 — 2,956 2,956 Total liabilities $ 430,573 $ 3,261 $ 433,834 $ 450,724 $ 5,126 $ 455,850 $ 447,843 $ 3,202 $ 451,045 The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis: Three months ended June 30, 2022 Three months ended June 30, 2021 Securitized Beneficial Interests Long-Term Debt Guarantees Securitized Beneficial Interests Long-Term Debt Guarantees Beginning balance $ 28,072 $ 246 $ 2,956 $ 19,370 $ 3,162 $ 1,740 Issuances of sales of receivables/guarantees — — 206 — — 223 Settlements ( 33,361 ) — ( 535 ) ( 36,695 ) — ( 26 ) Additions 29,033 414 — 38,498 2 — (Losses) gains recognized in earnings ( 982 ) — ( 26 ) ( 902 ) — 25 Ending balance $ 22,762 $ 660 $ 2,601 $ 20,271 $ 3,164 $ 1,962 For the three months ended June 30, 2022 and 2021, the impact to earnings attributable to the change in unrealized losses on securitized beneficial interests was $ 618 and $ 319 , respectively. 16. Pension and Other Postretirement Benefits On November 19, 2021, the Compensation Committee of the Company's Board of Directors approved a resolution to terminate the Company's U.S. defined benefit pension plan ("U.S. Pension Plan"). Termination of the U.S. Pension Plan is a twelve -to- eighteen month process. The Company will settle benefits directly with vested participants electing a lump sum payout and purchase a group annuity contract to administer future payments to the remaining U.S. Pension Plan participants. Based on the estimated value of assets held in the U.S. Pension Plan, the Company estimates that a cash contribution of between $ 3,000 and $ 5,000 will be required to fully fund the U.S. Pension Plan's liabilities upon termination. In addition, the Company expects to record a pension settlement charge at plan termination, which includes the reclassification of unrecognized pension gains and losses within accumulated other comprehensive income (loss) to other (expense) income, net within the Company's condensed consolidated statements of operations. The Company does not have an estimate for this future settlement charge. The amount of unrecognized pension gains within accumulated other comprehensive income (loss) related to the U.S. Pension Plan is approximately $ 5,401 at June 30, 2022. 17. Contingencies and Other Information Brazilian Tax Credits The government in the Brazilian State of Parana ("Parana") issued a tax assessment on October 26, 2007 with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. At June 30, 2022, the assessment for intrastate trade tax credits taken is $ 2,515 and the total assessment including penalties and interest is $ 9,386 . On March 18, 2014, the government in Brazilian State of Santa Catarina also issued a tax assessment with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. At June 30, 2022, the assessment for intrastate trade tax credits taken is $ 2,175 and the total assessment including penalties and interest is $ 6,057 . The Company believes it has properly complied with Brazilian law and will contest any assessment through the judicial process. Should the -19- Company lose in the judicial process, the loss of the intrastate trade tax credits would have a material impact on the financial statements of the Company. The Company also has local intrastate trade tax credits in the Brazil State of Rio Grande do Sul. This jurisdiction permits the sale or transfer of excess credits to third parties, however approval must be obtained from the tax authorities. The Company has an agreement with the state government regarding the amounts and timing of credits that can be sold. The tax credits have a carrying value of $ 16,708 . The intrastate trade tax credits are monitored for impairment in future periods based on market conditions and the Company’s ability to use or sell the tax credits. Other Matters In addition to the above-mentioned matters, certain of the Company’s subsidiaries are involved in other litigation or legal matters incidental to their business activities, including tax matters. While the outcome of these matters cannot be predicted with certainty, they are being vigorously defending and the Company does not currently expect that any of them will have a material adverse effect on its business or financial position. However, should one or more of these matters be resolved in a manner adverse to its current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material. Asset Retirement Obligations The Company identified an asset retirement obligation ("ARO") associated with one of its facilities that requires it to restore the land to its initial condition upon vacating the facility. The Company has not recognized a liability under generally accepted accounting principles for this ARO as the fair value of restoring the land at this site cannot be reasonably estimated since the settlement date is unknown at this time. The settlement date is unknown because the land restoration is not required until title is returned to the government, and the Company has no current or future plans to return the title. The Company will recognize a liability in the period in which sufficient information is available to reasonably estimate its fair value. 18. Related Party Transactions The Company engages in transactions with its equity method investees primarily for the procuring and processing of inventory. The following summarizes sales and purchases transactions with related parties: Three months ended June 30, 2022 Three months ended June 30, 2021 Sales $ 10,622 $ 10,637 Purchases 25,841 22,342 The Company included the following related party balances in its condensed consolidated balances sheets: June 30, 2022 June 30, 2021 March 31, 2022 Location in the Condensed Consolidated Balance Sheets Accounts receivable, related parties $ 17,750 $ 4,138 $ 1,896 Other receivables Notes receivable, related parties — 17,301 1,431 Other receivables Accounts payable, related parties 10,403 15,124 41,747 Accounts payable Advances from related parties 1,342 14,550 15,240 Advances from customers Transactions with Significant Shareholders On August 24, 2020, the Company entered into an Exit Term Loan Credit Agreement and issued Senior Secured First Lien Notes with certain lenders, including the Glendon Investor and the Monarch Investor. On April 23, 2021, the Company and certain of its subsidiaries with certain funds managed by the Glendon Investor and the Monarch Investor, as lenders, and related matters entered into a $ 120,000 delayed-draw credit facility agreement (see " Note 11. Debt Arrangements " for additional information). After that date, a fund managed by Owl Creek Asset Management, L.P. became a lender under the DDTL Facility. On December 30, 2021, the Company repaid $ 15,375 of the DDTL facility. On June 2, 2022, Intabex, the Company and the Guarantors entered into an Amendment and Restatement Agreement with the DDTL Facility Lenders and the DDTL Agent to amend and restate the DDTL Facility Credit Agreement as set forth in Amended Credit Agreement, which became effective on July 28, 2022 (see " Note 11. Debt Arrangements " and " Note 20. Subsequent Events " for additional information). Accrued expenses and other current liabilities as presented in the condensed consolidated balance sheets as of June 30, 2022 and 2021, and March 31, 2022, includes $ 5,953 , $ 6,361 , and $ 3,984 , respectively, of interest payable to the Glen don Investor, -20- the Monarch Investor, and funds managed by Owl Creek Asset Management, L.P. Interest expense as presented in the condensed consolidated statements of operations includes $ 8,097 and $ 7,499 for the three months ended June 30, 2022 and 2021, respectively, that relates to the Glendon Investor, the Monarch Investor, and funds managed by Owl Creek Asset Management, L.P. Transactions with the Deconsolidated Canadian Cannabis Subsidiaries In connection with the CCAA Proceeding, the DIP Lender, another non-U.S. subsidiary of the Company, provided Figr Brands with secured debtor-in-possession financing to fund the working capital needs of the Canadian Cannabis Subsidiaries in accordance with the cash flow projections approved by the Monitor and the DIP Lender. These payments also funded fees and expenses paid to the DIP Lender, professional fees and expenses incurred by the Canadian Cannabis Subsidiaries and the Monitor in respect of the CCAA Proceeding, and such other costs and expenses of the Canadian Cannabis Subsidiaries as agreed to by the DIP Lender. As of June 30, 2022 and 2021, and March 31, 2022, the outstanding loan balance under the Canadian DIP Facility was $ 0 , $ 11,082 , and $ 0 , respectively, and is included in other receivables within the condensed consolidated balance sheets. On July 8, 2021, the loans under the Canadian DIP Facility were fully repaid to the DIP Lender. 19. Segment Information The following summarizes segment information, with the All Other category being included for purposes of reconciliation of the respective balances below of the Leaf segment (the Company's sole reportable segment) to the condensed consolidated financial statements: Three months ended June 30, 2022 Three months ended June 30, 2021 Sales and other operating revenues: Leaf $ 340,626 $ 329,858 All Other 3,279 3,432 Consolidated sales and other operating revenues $ 343,905 $ 333,290 Segment operating income: Leaf $ 11,629 $ 14,778 All Other ( 4,377 ) ( 6,341 ) Segment operating income 7,252 8,437 Restructuring and asset impairment charges 300 233 Consolidated operating income $ 6,952 $ 8,204 June 30, 2022 June 30, 2021 March 31, 2022 Segment assets: Leaf $ 1,760,557 $ 1,598,242 $ 1,641,552 All Other 51,889 83,586 56,975 Total assets $ 1,812,446 $ 1,681,828 $ 1,698,527 20. Subsequent Events On July 28, 2022, the Amended Credit Agreement became effective (see " Note 11. Debt Arrangements " for additional information). In connection with the effectiveness of the Amended Credit Agreement, the Glendon Investor, the Monarch Investor, and a fund managed by Owl Creek Asset Management, L.P. received $ 5,119 of the aggregate $ 5,250 in exit fee payments from the repayment of the principal amount under the DDTL Facility. The Glendon Investor, the Monarch Investor and a fund managed by Owl Creek Asset Management, L.P. received in the aggregate $ 3,900 of the total $ 4,000 in commitment and closing fees, which were reflected as original issue discount, paid to all Term Loan Lenders in connection with the aggregate $ 97,500 principal amount of the Term Loans made by them of the total $ 100,000 aggregate principal amount of the Term Loans made by all Term Loan Lenders. -21-