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Note 6 - Indebtedness
 6 Months Ended
Sep. 30, 2025
Notes to Financial Statements  
Debt Disclosure [Text Block]

Note 6. Indebtedness

 

Credit Facility

Our senior secured credit agreement includes:

 

(i)

 A revolving credit facility with an aggregate principal amount of up to $125,000 (the "Revolver"),

(ii)

 A term loan with a maximum principal amount of $75,000, which is subject to escalating quarterly principal payments (the "Term Loan"),

(iii)

 A swingline loan with an aggregate principal amount not exceeding $5,000, and 

(iv)

 Letters of credit with an aggregate stated amount not exceeding $2,500 at any time. 

 

We refer to the agreement in whole as the “Credit Facility.” The Credit Facility matures in April 2029.

 

On  April 5, 2024, we borrowed $75,000 under the Term Loan to fund privately negotiated repurchases of a portion of our convertible notes ("the Notes"). On  August 12, 2025, we borrowed $97,000 under the Revolver to fund the cash settlement of the remaining Notes, which matured on August 15, 2025 (see "Convertible Notes" below). 

 

Amounts borrowed under the Credit Facility as of September 30, 2025 bore interest at a base rate or SOFR rate, plus an applicable spread ranging from 1.5% to 3.5%, depending on our total net leverage ratio. On October 10, 2025 we amended the Credit Facility to reduce the applicable spread to 1.25% to 2.5%.

 

The weighted average interest rate on borrowings under the Credit Facility as of  September 30, 2025 was 7.1%. The interest rate on outstanding borrowings decreased to 6.7% following the amendment to our Credit Facility in October 2025.

 

The financial covenants in the Credit Facility include a maximum total net leverage ratio of 4.0 to 1.0 on each of the testing dates between March 31, 2025 and March 31, 2026 and 3.5 to 1.0 on each testing date thereafter. The Credit Facility also stipulates a minimum fixed charge coverage ratio of 1.25 to 1.0. Other covenants include restrictions on our ability to incur debt, grant liens, make fundamental changes to our business as defined in the contract, engage in certain transactions with affiliates, or conduct asset sales. As of  September 30, 2025, we were in compliance with all covenants under the Credit Facility.

 

Term Loan

During the three and six months ended September 30, 2025, we made required quarterly principal payments on the Term Loan of $938 and $1,875, respectively.

 

We are required to make quarterly principal payments on the Term Loan. For the fiscal years ending March 31, future debt payments on the Term Loan are required as follows:

 

Fiscal Year

 

Amount

 

Remainder of 2026

 $1,875 

2027

  5,625 

2028

  5,625 

2029

  7,500 

2030

  48,750 

Total principal remaining

 $69,375 

 

A reconciliation of the carrying amount of the Term Loan to principal outstanding was as follows:

 

  

September 30, 2025

  

March 31, 2025

 

Current portion

 $4,688  $3,750 

Noncurrent portion

  64,164   66,902 

Debt issuance costs

  523   598 

Term Loan principal outstanding

 $69,375  $71,250 

 

We recognized interest expense on the Term Loan as follows:

 

  

Three Months Ended September 30,

  

Six Months Ended September 30,

 
  

2025

  

2024

  

2025

  

2024

 

Interest expense (7.2% and 8.4% as of September 30, 2025 and 2024, respectively)

 $1,305  $1,662  $2,597  $3,101 

Amortization of debt issuance costs

  38   38  

75

   73 

Total interest and amortization of debt issuance costs

 $1,343  $1,700  $2,672  $3,174 

 

 

Revolver

As of  September 30, 2025, the outstanding balance under the Revolver was $106,000, and $19,000 remained available to be borrowed. Subsequent to  September 30, 2025, we repaid an additional $2,000 on the Revolver.

 

We are obligated to pay quarterly unused commitment fees of between 0.20% and 0.35% of the Revolver’s aggregate principal amount, based on our leverage ratio.

 

The balance of unamortized customary lender fees related to the Revolver was $1,053 and $1,203 as of  September 30, 2025 and  March 31, 2025, respectively.

 

Convertible Notes

 

On August 15, 2025, our outstanding 1.375% convertible Notes matured. We settled the aggregate principal balance of $97,500 as well as $670 of accrued interest in cash, using $97,000 drawn under our Revolver and $1,170 of cash on hand.

 

Interest expense recognized in connection with the Notes during the three and six months ended September 30, 2025 and 2024 respectively, was as follows:

 

  

Three Months Ended September 30,

  

Six Months Ended September 30,

 
  

2025

  

2024

  

2025

  

2024

 

Coupon interest expense at 1.375%

 $168  $335  $503  $702 

Amortization of debt issuance costs

  68   133   203   278 

Total interest and amortization of debt issuance costs

 $236  $468  $706  $980 

 

The effective interest rate on the Notes was approximately 1.9%.

 

The net carrying amount of the Notes was as follows:

 

  

September 30, 2025

  

March 31, 2025

 

Principal outstanding

 $-  $97,500 

Unamortized debt issuance costs

  -   (203)

Net carrying value

 $-  $97,297 

 

As of September 30, 2025, no Notes remain outstanding.