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| Debt | 8. Debt Senior Secured Credit Facilities Credit Agreement We have a Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) which provides for a five-year term loan facility in an aggregate principal amount of $200.0 million and, in addition, up to $100.0 million for a revolving credit facility, including a letter of credit sub-facility in the aggregate availability amount of $20.0 million and a swingline sub-facility in the aggregate availability amount of $10.0 million (as a sublimit of the revolving loan facility). The Credit Agreement matures on November 3, 2027. We have been using the proceeds to fund the growth of our business and support our working capital requirements. Under the agreement, we may elect whether amounts drawn bear interest on the outstanding principal amount at a rate per annum equal to either (a) the higher of the Prime rate or the Federal Funds Effective rate (“Base Rate”) plus 0.5% or (b) the forward-looking term rate based on the secured overnight financing rate (“Term SOFR”). An additional interest rate margin is added to the elected interest rates. Our interest rate margin ranges from 0.5% to 2.5% in the case of Base Rate advances and from 1.5% to 3.5% in the case of Term SOFR advances, depending on our debt to consolidated adjusted EBITDA leverage ratio as defined in the Credit Agreement. In addition, the Credit Agreement contains other customary representations, warranties, and covenants, including covenants by us limiting additional indebtedness, guarantees, liens, fundamental changes, mergers and consolidations, dispositions of assets, investments, paying dividends on capital stock or redeeming, repurchasing, or retiring capital stock, prepaying certain junior indebtedness and preferred stock, certain corporate changes, and transactions with affiliates. The Credit Agreement also provides for customary events of default, including but not limited to, non-payment, breaches, or defaults in the performance of covenants, insolvency, bankruptcy, and the occurrence of a material adverse effect on us. On August 5, 2026, we entered into a new Senior Secured Credit Agreement providing for aggregate commitments of $300.0 million, consisting of a $240.0 million revolving credit facility and a $60.0 million term loan facility. The proceeds from the new facility, which matures on August 5, 2031, were used to refinance the Company’s existing indebtedness and will provide ongoing liquidity for working capital requirements, general corporate purposes, and other strategic initiatives. In connection with closing, we reduced our cash balance by $36.6 million to reduce our indebtedness. As of August 5, 2026, we had used borrowing capacity of $140.0 million under our $240.0 million revolving credit facility and had $60.0 million outstanding on the term loan facility. The foregoing description of the new Senior Secured Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the new Senior Secured Credit Agreement, to be filed as an exhibit to our Quarterly Report on Form 10-Q for the quarter ending September 30, 2026. The following table summarizes outstanding debt balances (in thousands):
(1) Deferred debt issuance costs associated with the term loan facility are recorded net of the debt obligation and amortized to interest expense over the term of the Credit Agreement. As of June 30, 2026, we were in compliance with all covenants contained in the Credit Agreement. In addition, we had $62.0 million outstanding under our $100.0 million revolving credit facility, and we had outstanding letters of credit totaling $7.8 million in connection with securing leased office spaces.
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