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Note F - Debt Facilities
 9 Months Ended
Jan. 31, 2024
Notes to Financial Statements  
Debt Disclosure [Text Block]

F – Debt Facilities

 

A summary of debt facilities is as follows:

 

(In thousands)

  

January 31, 2024

    

April 30, 2023

  

Revolving line of credit

   $ 55,994     $ 168,516  

Debt issuance costs

     (620 )     (1,285 )
                 

Revolving line of credit, net

   $ 55,374     $ 167,231  
                 

Non-recourse notes payable - 2022-1 Issuance

   $ -     $ 134,137  

Non-recourse notes payable - 2023-1 Issuance

     190,674     $ 338,777  

Non-recourse notes payable - 2023-2 Issuance

     248,130       -  

Non-recourse notes payable - 2024-1 Issuance

     250,000       -  

Debt issuance costs

     (4,116 )     (1,547 )
                 

Non-recourse notes payable, net

   $ 684,688     $ 471,367  
                 

Total debt

   $ 740,062     $ 638,598  

 

Revolving Line of Credit

 

At January 31, 2024, the Company and its subsidiaries had $600.0 million of permitted borrowings under a revolving line of credit. The revolving credit facilities are collateralized primarily by finance receivables and inventory, are cross collateralized and contain a guarantee by the Company. Interest is payable monthly under the revolving credit facilities with a scheduled maturity date of September 29, 2024. The credit facilities provide for four pricing tiers for determining the applicable interest rate, based on the Company’s consolidated leverage ratio for the preceding fiscal quarter. The applicable interest rate under the credit facilities at January 31, 2024 was generally SOFR plus 2.75%, with a minimum of 2.25% or for non-SOFR amounts the base rate of 8.50% at January 31, 2024 and 8.25% at April 30, 2023. The credit facilities contain various reporting and performance covenants including (i) maintenance of certain financial ratios and tests, (ii) limitations on borrowings from other sources, (iii) restrictions on certain operating activities and (iv) restrictions on the payment of dividends or distributions (see note B).

 

The Company was in compliance with the covenants at January 31, 2024. The amount available to be drawn under the credit facilities is a function of eligible finance receivables and inventory; based upon eligible finance receivables and inventory at January 31, 2024, the Company had additional availability of approximately $125.6 million under the revolving credit facilities. The total permitted borrowings and certain terms of the Company’s revolving credit facilities were amended on February 28, 2024. This amendment is described in Note M, Subsequent Events.

 

Non-Recourse Notes Payable

 

The Company has issued four separate series of asset-backed non-recourse notes (known as the “2022 Issuance”, “2023-1 Issuance”, "2023-2 Issuance" and "2024-1 Issuance"). All four issuances are collateralized by installment sale contracts directly originated by the Company. Credit enhancement for the non-recourse notes payable consists of overcollateralization, a reserve account funded with an initial amount of not less than 2.0% of the pool balance, excess interest on the auto finance receivables, and in some cases, the subordination of certain payments to noteholders of less senior classes of notes. The timing of principal payments on the non-recourse notes payable is based on the timing of principal collections and defaults on the related auto finance receivables. In December 2023, the Company fully paid off the 2022 Issuance. The three notes payable related to the remaining term securitization transactions accrue interest predominately at fixed rates and have scheduled maturities through January 22, 2030, June 20, 2030, and January 21, 2031, respectively, but may mature earlier, depending upon repayment rate of the underlying auto finance receivables. The original principal balance and weighted average fixed coupon rate for the three securitizations are as follows:

 

     

Original Principal Balance
(in thousands)

    

Weighted Average Fixed Coupon Rate

  
                   
2023-1     $ 400,200       8.68 %
2023-2       360,300       8.80 %
2024-1       250,000       9.50 %