Zix Acquires Leading Cloud-Based Backup and Recovery Provider CloudAlly - Seite 2

Avinoam Katz, CloudAlly’s Chief Executive Officer, commented: "A comprehensive data protection plan is more important than ever as companies around the world are focusing on cybersecurity for their remote workforce. We're extremely excited to join forces with Zix at this time and feel that our industry leading cloud backup service will be a complementary and valuable addition to their recently announced Secure Cloud Platform, an integrated suite of productivity, security and compliance services. This suite of services will give our rapidly growing combined customer and partner base around the world the tools they need to protect their critical cloud assets across an evolving distributed workforce."

Financing Terms

In connection with the acquisition, Zix modified its existing senior secured term loan led by Truist Bank by adding additional borrowings of $35.0 million, bringing the total outstanding amount of the term loan to $212.2 million. The maturity date remains February 20, 2024 and carries the same interest rate (currently LIBOR plus 3.25%), which is subject to future step-downs as Zix’s leverage reduces. Additionally, Zix intends to use a portion of the additional term loan borrowing to repay all existing draws under its revolving credit facility, which will leave Zix with $25.0 million of capacity under its revolver.

On a pro forma basis, taking into effect the CloudAlly acquisition, as of December 31, 2020, Zix expects to have over $20.0 million of cash and cash equivalents and total long-term debt of $212.1 million.

“Beyond the direct benefits from an operational standpoint, our acquisition of CloudAlly should also be highly accretive from a financial perspective,” said Dave Rockvam, Zix’s Chief Financial Officer.” Its 100% subscription business and favorable profitability profile provide us with predictable adjusted EBITDA and cash flow to augment our already-robust financial base. We sought out CloudAlly because of the strong, born-in-the-cloud business they have today, but we believe that what it could be in the future represents an even more attractive ROI for Zix. Longer-term, our strong, unlevered free cash flow generation capabilities, aided by CloudAlly, have us on solid footing to comfortably service our debt obligations over time.”