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Debt | 3 Months Ended
--- | ---
Dec. 31, 2024
Debt Disclosure [Abstract] |
Debt | NOTE 7: DEBT The following table presents the Company's debt instruments outstanding:
| December 31, 2024 |  | December 31, 2023 |  | September 30, 2024
(in thousands) | Gross Amount |  | Debt Issuance Costs |  | Carrying Amount |  | Gross Amount |  | Debt Issuance Costs |  | Carrying Amount |  | Gross Amount |  | Debt Issuance Costs |  | Carrying Amount
2029 Convertible Notes | $ | 230,000 |  |  | $ | (5,495) |  |  | $ | 224,505 |  |  | $ | 230,000 |  |  | $ | (6,472) |  |  | $ | 223,528 |  |  | $ | 230,000 |  |  | $ | (5,744) |  |  | $ | 224,256 |
2025 Convertible Notes | 103,373 |  |  | (168) |  |  | 103,205 |  |  | 103,373 |  |  | (678) |  |  | 102,695 |  |  | 103,373 |  |  | (301) |  |  | 103,072 |
2024 Convertible Notes | — |  |  | — |  |  | — |  |  | 34,389 |  |  | (82) |  |  | 34,307 |  |  | — |  |  | — |  |  | — |
Total | $ | 333,373 |  |  | $ | (5,663) |  |  | $ | 327,710 |  |  | $ | 367,762 |  |  | $ | (7,232) |  |  | $ | 360,530 |  |  | $ | 333,373 |  |  | $ | (6,045) |  |  | $ | 327,328 |
Less current portion | 103,373 |  |  | (168) |  |  | 103,205 |  |  | 34,389 |  |  | (82) |  |  | 34,307 |  |  | 103,373 |  |  | (301) |  |  | 103,072 |
Total long-term debt | $ | 230,000 |  |  | $ | (5,495) |  |  | $ | 224,505 |  |  | $ | 333,373 |  |  | $ | (7,150) |  |  | $ | 326,223 |  |  | $ | 230,000 |  |  | $ | (5,744) |  |  | $ | 224,256 |
The following table presents the Company’s contractual maturities related to the debt instruments as of December 31, 2024:
| Schedule of Contractual Maturities
(in thousands) | 2029 Convertible Notes |  | 2025 Convertible Notes |  |  |  | Total
Remaining 2025 | $ | — |  |  | $ | 103,373 |  |  |  |  | $ | 103,373 |
Fiscal 2026 | — |  |  | — |  |  |  |  | — |
Fiscal 2027 | — |  |  | — |  |  |  |  | — |
Fiscal 2028 | — |  |  | — |  |  |  |  | — |
Fiscal 2029 | — |  |  | — |  |  |  |  | — |
Thereafter | 230,000 |  |  | — |  |  |  |  | 230,000 |
Total long-term debt | $ | 230,000 |  |  | $ | 103,373 |  |  |  |  | $ | 333,373 |
The following table presents the Company’s interest expense related to the Convertible Notes for the three months ended December 31, 2024 and 2023:
|  |  | Three Months Ended December 31,
(in thousands) |  |  |  |  | 2024 |  | 2023
2029 Convertible Notes: |  |  |  |  |  |  |
Contractual interest expense |  |  |  |  | $ | 2,156 |  |  | $ | 2,156 |
Amortization of deferred financing costs |  |  |  |  | 249 |  |  | 244 |
Total interest expense |  |  |  |  | $ | 2,405 |  |  | $ | 2,400 |
2025 Convertible Notes: |  |  |  |  |  |  |
Contractual interest expense |  |  |  |  | $ | 614 |  |  | $ | 614 |
Amortization of deferred financing costs |  |  |  |  | 133 |  |  | 131 |
Total interest expense |  |  |  |  | $ | 747 |  |  | $ | 745 |
2024 Convertible Notes: |  |  |  |  |  |  |
Contractual interest expense |  |  |  |  | $ | — |  |  | $ | 247 |
Amortization of deferred financing costs |  |  |  |  | — |  |  | 42 |
Total interest expense |  |  |  |  | $ | — |  |  | $ | 289 |
2029 Convertible Notes In December 2022, we issued $230.0 million aggregate principal amount of the 2029 Convertible Notes, for which $230.0 million remains outstanding as of December 31, 2024. The 2029 Convertible Notes were issued pursuant to an indenture dated December 12, 2022 (the “2022 Indenture”) by and between the Company and Truist Bank, as trustee. The 2029 Convertible Notes were issued in a private offering under Rule 144A under the Securities Act of 1933. The 2029 Convertible Notes pay interest semi-annually in arrears at a rate of 3.750% per annum on June 15 and December 15 of each year, commencing June 15, 2023, and mature on December 15, 2029 (the “2029 Maturity Date”), unless converted, redeemed or repurchased in accordance with the terms prior to such date. At maturity, the holders of the 2029 Convertible Notes will be entitled to receive cash equal to the principal of the 2029 Convertible Notes plus accrued interest. The effective interest rate for the three months ended December 31, 2024 was approximately 4.28%. As of December 31, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2029 Maturity Date assuming no early conversion. The 2029 Convertible Notes are convertible based on an initial conversion rate of 89.0313 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $11.23 per share). The conversion rate will not be adjusted for any accrued and unpaid interest. The 2029 Convertible Notes contain certain make-whole fundamental change premiums and customary anti-dilution adjustments. Upon conversion, we may settle in cash, shares of Class A Common Stock or any combination thereof, at our election. Prior to June 15, 2029, the 2029 Convertible Notes will be convertible only under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending on March 31, 2023 (and only during such fiscal quarter), if the last reported sale price of our Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price, as defined in the 2022 Indenture, per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our Class A Common Stock and the conversion rate on such trading day; (3) if we call any or all of the 2029 Convertible Notes for redemption, at any time prior to the close of business on the business day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events, as defined in the 2022 Indenture. On or after June 15, 2029 until the close of business on the business day immediately preceding the 2029 Maturity Date, holders of 2029 Convertible Notes may, at their option, convert their 2029 Convertible Notes at any time, regardless of the foregoing circumstances. We may not redeem the 2029 Convertible Notes prior to December 21, 2026. At our option, we may redeem for cash all or any portion of the 2029 Convertible Notes on or after December 21, 2026, if the last reported sale price of the Class A Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which we provide notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption. The redemption price will be equal to 100% of the principal amount of the 2029 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. As of December 31, 2024, the 2029 Convertible Notes were not convertible as no conditions of conversion had been met. Accordingly, the net balance of the 2029 Convertible Notes was classified as a non-current liability in our condensed consolidated balance sheets as of December 31, 2024. The classification of the 2029 Convertible Notes as current or non-current in the condensed consolidated balance sheets is evaluated at each balance sheet date and may change from time to time depending on whether any of the conversion conditions has been met. If one of the conversion conditions is met in any future fiscal quarter, we will classify our net liability under the 2029 Convertible Notes as a current liability in the condensed consolidated balance sheets as of the end of that fiscal quarter. If none of the conversion conditions have been met in a future fiscal quarter prior to the one-year period immediately preceding the 2029 Maturity Date, we will classify our net liability under the 2029 Convertible Notes as a non-current liability in the condensed consolidated balance sheets as of the end of that fiscal quarter. If the note holders elect to convert their 2029 Convertible Notes prior to maturity, any unamortized debt issuance costs will be recognized as expense at the time of conversion. If the entire outstanding principal amount had been converted on December 31, 2024, we would have recorded an expense associated with the conversion, comprised of $5.5 million of unamortized debt issuance costs. The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2024. As of December 31, 2024, the if-converted value of the 2029 Convertible Notes did not exceed the principal amount. 2025 Convertible Notes In May 2018, we issued $172.5 million aggregate principal amount of the 2025 Convertible Notes. The 2025 Convertible Notes were issued pursuant to an indenture dated May 14, 2018 (the “2018 Indenture”) by and between the Company and Wells Fargo Bank, National Association, as the original trustee. Effective October 1, 2019, Truist (formerly BB&T) assumed the duties and responsibilities as trustee under the 2018 Indenture. The 2025 Convertible Notes were issued in a private offering under Rule 144A under the Securities Act of 1933. In December 2022, we repurchased approximately $69.1 million aggregate principal amount of the 2025 Convertible Notes for approximately $62.9 million plus accrued interest. As of December 31, 2024, $103.4 million remains outstanding. The 2025 Convertible Notes pay interest semi-annually in arrears at a rate of 2.375% per annum on May 1 and November 1 of each year, commencing November 1, 2018, and mature on May 1, 2025 (the “2025 Maturity Date”), unless converted, redeemed or repurchased in accordance with the terms prior to such date. The effective interest rate for the three months ended December 31, 2024 was approximately 2.88% for the 2025 Convertible Notes. As of December 31, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2025 Maturity Date assuming no early conversion. The 2025 Convertible Notes are convertible based on an initial conversion rate of 62.8931 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $15.90 per share). The conversion rate will not be adjusted for any accrued and unpaid interest. The 2025 Convertible Notes contain certain make-whole fundamental change premiums and customary anti-dilution adjustments. Until the close of business on the business day immediately preceding the 2025 Maturity Date, holders of 2025 Convertible Notes may, at their option, convert their 2025 Convertible Notes at any time. Pursuant to the terms of the 2018 Indenture, we have elected to settle any conversions of the 2025 Convertible Notes using shares of Class A Common Stock (physical settlement). On October 28, 2024, we provided notice of that election to the trustee. If the note holders elect to convert their 2025 Convertible Notes prior to maturity, any unamortized debt issuance costs will be recognized as expense at the time of conversion. If the entire outstanding principal amount had been converted on December 31, 2024, we would have recorded an expense associated with the conversion, comprised of $0.2 million of unamortized debt issuance costs. The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2024. As of December 31, 2024, the if-converted value of the 2025 Convertible Notes did not exceed the principal amount and none of the note holders had elected to convert their 2025 Convertible Notes. 2024 Convertible Notes In July 2017, we issued $143.75 million aggregate principal amount of the 2024 Convertible Notes. The 2024 Convertible Notes were issued pursuant to an indenture dated July 5, 2017 (the “2017 Indenture”) by and between the Company and Wells Fargo Bank, National Association, as the original trustee. Effective October 1, 2019, Truist (formerly BB&T) assumed the duties and responsibilities as trustee under the 2017 Indenture. The 2024 Convertible Notes were issued in a private offering under Rule 144A under the Securities Act of 1933. In December 2022, we repurchased approximately $109.4 million aggregate principal amount of the 2024 Convertible Notes for approximately $117.5 million plus accrued interest. On July 1, 2024, the $34.4 million aggregate principal amount outstanding plus accrued interest was repaid using cash on hand and 77,328 Class A Common Stock shares, equal to the accreted value, were issued as part of the 2024 Convertible Notes conversion. The 2024 Convertible Notes paid interest semi-annually in arrears at a rate of 2.875% per annum on January 1 and July 1 of each year, commencing January 1, 2018, and matured on July 1, 2024 (the “2024 Maturity Date”). The 2024 Convertible Notes were convertible based on an initial conversion rate of 100 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $10.00 per share). Until the close of business on the business day immediately preceding the 2024 Maturity Date, holders of 2024 Convertible Notes could, at their option, convert their 2024 Convertible Notes at any time. Because we did not elect an alternative settlement method prior to January 1, 2024, conversions were settled by combination settlement, which was $1,000 cash (per the $1,000 principal value) plus stock equal to the accreted value as defined in the 2017 Indenture.

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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 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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