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Credit Facility | 9 Months Ended
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Apr. 30, 2024
Line of Credit Facility [Abstract] |
Credit Facility | Credit Facility On Nov ember 7, 2023, we entered into a Third Amended and Restated Credit Agreement (the "Prior Credit Facility"), which provided f or a senior secured loan facility of up to $200,000,000 consisting of: (i) a revolving loan facility with an initial borrowing limit of $150,000,000, including a $20,000,000 letter of credit sublimit; and (ii) a $50,000,000 te rm loan. The Prior Credit Fac ility also provided for the following: effective January 31, 2024 and April 30, 2024, (a) our borrowing limit under the revolving loan facilit y reduced to $140,000,000 and $135,000,000, respectively; (b) the term loa n amortization increased from $1,250,000 to $1,875,000 per quarter, with the remaining balance due upon maturity; (c) the accordion and swingline loan features were both eliminated; (d) the Applicable Rate increased 0.25%; (e) cash in excess of $20,000,000 on the last day of any wee k was required to repay borrowings under the revolving loan fa cility; and (f) financial covenants were measured on a monthly basis beginning February 2024. In connection with entering the Prior Credit Facility, we capitalized $5,941,000 of total financing costs and accounted for the amendments as debt modifications. The amount outstanding under our Prior Credit Facility was as follows:
|  | April 30, 2024 |  | July 31, 2023
Term loan |  | $ | 27,512,000 |  |  | $ | 48,125,000 |
Less unamortized deferred financing costs related to term loan |  | 545,000 |  |  | 621,000 |
Term loan, net |  | 26,967,000 |  |  | 47,504,000 |
Revolving loan facility |  | 134,454,000 |  |  | 116,900,000 |
Amount outstanding unde r Prior Credit Facility, net |  | $ | 161,421,000 |  |  | $ | 164,404,000 |
Less current portion of long-term debt |  | 3,712,000 |  |  | 4,375,000 |
Non-current portion of long-term debt |  | $ | 157,709,000 |  |  | $ | 160,029,000 |
At April 30, 2024, we had $481,000 of standby letters of credit outstanding under our Prior Credit Facility related to guarantees of future performance on certain customer contracts and no outstanding commercial letters of credit. During the nine months ended April 30, 2024, we had outstanding balances under the Prior Credit Facility ranging from $156,241,000 to $196,800,000. As of April 30, 2024, total net deferred financing costs related to the Prior Credit Facility were $2,267,000 and being amortized over the term of our Prior Credit Facility through the Maturity Date. However, as discussed further below, subsequent to quarter end, we refinanced our Prior Credit Facility with the New Credit Facility. As the refinancing of the Prior Credit Facility is considered a debt extinguishment, net deferred financing costs related to the Prior Credit Facility will be expensed during our fourth quarter of fiscal 2024 and included in interest expense reported on our Condensed Consolidated Statement of Operations. Interest expense related to our Prior Credit Facility, including amortization of deferred financing costs, recorded during the three months ended April 30, 2024 and 2023 was $5,130,000 and $4,400,000, respectively. Interest expense related to our Prior Credit Facility including amortization of deferred financing costs, recorded during the nine months ended April 30, 2024 and 2023 was $15,286,000 and $10,401,000, respectively. Our blended interest rate approximated 12.26% and 10.10%, respectively, for the three months ended April 30, 2024 and 2023 and 11.35% and 8.34%, respectively, for the nine months ended April 30, 2024 and 2023. As of April 30, 2024, our Secured Leverage Ratio under our Prior Credit Facility was 2.89x trailing twelve months ("TTM") Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"), compared to the maximum allowable Secured Leverage Ratio of 3.50x TTM Adjusted EBITDA; our Interest Expense Coverage Ratio under our Prior Credit Facility was 3.36x TTM Adjusted EBITDA, compared to the Minimum Interest Expense Coverage Ratio of 3.25x TTM Adjusted EBITDA; and our Minimum Liquidity was $26,800,000, compared to the Minimum Liquidity requirement of $25,000,000. Subsequent Event On June 17, 2024, we entered into a $222,000,000 credit facility with a new syndicate of lenders (the “New Credit Facility”), which replaces our Prior Credit Facility and which is expected to fund on or around June 18, 2024. The New Credit Facility matures on July 31, 2028, consists of a committed $162,000,000 Term Loan and $60,000,000 Revolver and is expected to have outstanding borrowings at close of $187,000,000, reflecting $25,000,000 drawn on the Revolver. The New Credit Facility provides that (a) Revolving Loans comprised of (i) Base Rate Loans shall bear interest at the Base Rate plus an additional margin ranging from 3.75% to 4.25%, depending on the average quarterly revolving loan usage during the applicable determination period and (ii) SOFR Loans shall bear interest at the Term SOFR rate plus an additional margin ranging from 4.75% to 5.25%, depending on the average quarterly revolving loan usage during the applicable determination period and (b) Term Loans comprised of (i) Base Rate Loans shall bear interest at the Base Rate plus an additional margin ranging from 7.50% to 9.00%, depending on our net leverage ratio during the applicable determination period and (ii) SOFR Loans shall bear interest at the Term SOFR rate plus an additional margin ranging from 8.50% to 10.00%, depending on our net leverage ratio during the applicable determination period. The Term Loan is subject to 2.50% amortization per annum, payable on the last day of each fiscal quarter. The first Term Loan repayment of $675,000 is due on July 31, 2024 and quarterly Term Loan repayments thereafter are $1,012,500, with the remaining Term Loan balance due on the Maturity Date. Based on the refinancing of our Prior Credit Facility subsequent to the balance sheet date, we have classified $157,709,000 of the outstanding borrowings as of April 30, 2024 under our Prior Credit Facility as a non-current liability. The New Credit Facility contains (a) customary representations, warranties and affirmative covenants; (b) customary conditions to drawing the Revolver; (c) customary negative covenants, subject to negotiated exceptions, including but not limited to: (i) liens, (ii) investments, (iii) indebtedness, (iv) significant corporate changes, including mergers and acquisitions, (v) dispositions, including the disposition of assets by any Loan Party to any Subsidiary that is not a Subsidiary Loan Party, (vi) restricted payments, including stockholder dividends, (vii) distributions, including the repayment of subordinated intercompany and third party indebtedness, and (viii) certain other restrictive agreements; (d) certain financial covenants, including a maximum Net Leverage Ratio, minimum Fixed Charge Coverage Ratio, Minimum Average Liquidity and Minimum EBITDA; (e) customary optional and mandatory prepayment events; and (f) customary events of default (subject to grace periods, as appropriate), such as payment defaults, cross-defaults to other material indebtedness, bankruptcy and insolvency, the occurrence of a defined change in control and the failure to observe the negative covenants and other covenants related to the operation of our business. In addition, under certain circumstances, we may be required to enter into amendments to the New Credit Facility in connection with any further syndication of the New Credit Facility. In connection with entering the New Credit Facility, the Term Loan lenders received 1,435,884 detachable warrants granted at an exercise price of $0.10 per common share. If the Term Loan is refinanced, the Term Loan lenders have the right to sell up to 50.0% of the warrants back to us for cash, at a 10.0% discount to the 30-day volume weighted average price of our common stock. The obligations under the New Credit Facility are guaranteed by certain of our domestic and foreign subsidiaries (the “Guarantors”). As collateral security under the New Credit Facility and the guarantees thereof, we and the Guarantors granted to the administrative agent, for the benefit of the lenders, a lien on, and first priority security interest in, all of our tangible and intangible assets. Capitalized terms used but not defined herein have the meanings set forth for such terms in the Prior Credit Facility and the New Credit Facility, which have been or will be documented and filed with the SEC.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1E -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I + Details
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