Quarterly report pursuant to Section 13 or 15(d)

Debt

v3.21.2
Debt
 6 Months Ended
Jul. 31, 2021
Debt Disclosure [Abstract]  
Debt Debt
The following table summarizes the Company's long-term debt at January 31, 2021 (in thousands):
January 31,
2021
Senior Subordinated Secured Convertible Note $ 75,000 
Paid-in-kind interest 5,390 
Principal balance 80,390 
Less: Unamortized debt discounts and issuance costs (1,542)
Revolving credit facility — 
Total Debt $ 78,848 

There was no long-term debt outstanding at July 31, 2021.
Senior Subordinated Secured Convertible Notes

On May 20, 2020 (the “NPA Closing Date”), the Company issued senior subordinated convertible notes for an aggregate principal amount of $75 million pursuant to the Company’s Senior Subordinated Secured Convertible Note Purchase Agreement, dated May 20, 2020, by and among the Company, its subsidiaries, TPG Specialty Lending Inc., as Administrative Agent and Arranger (“TPG”), and certain other investor parties (the “Note Purchase Agreement”), with an initial maturity date of May 20, 2025 (the “Notes”). The Notes were issued for face amount net of a closing fee of 1.05% on the entire $150 million commitment for all Notes (corresponding to an original issue discount of 2.1% on the Notes) and carried a fixed rate of 9.875% per annum. The interest was paid in kind by increasing the principal amount of the Notes. The Notes were sold at a price and had a value at issuance not significantly in excess of the face amount; accordingly, none of the proceeds were allocated to equity.

Upon the completion of the IPO, the Notes automatically converted pursuant to their terms into 9,694,004 shares of Class B common stock.

Interest Expense

The following table presents the components of interest expense incurred on the Notes for the three and six months ended July 31, 2021 (in thousands):

Three Months Ended July 31, Six Months Ended July 31,
2021 2020 2021 2020
Interest expense at coupon rate $ 1,220  $ 1,481  $ 3,182  $ 1,481 
Amortization of debt discounts and issuance costs 32  36  84  36 
Total interest expense $ 1,252  $ 1,517  $ 3,266  $ 1,517 

The debt discount was amortized to interest expense at an annual effective interest rate of 10.3% over the contractual terms of the Notes. Interest expense is included in Other expense, net on the condensed consolidated income statement of operations.

Credit Agreement
The Company maintains a credit agreement with Silicon Valley Bank (the "Credit Agreement"). Under the terms of the Credit Agreement, the Company can borrow up to $50.0 million on its revolving credit loan facility on its revolving credit loan facility at the higher of prime interest rate plus 0.25% or federal funds effective rate plus 0.50% plus 0.25%. The Amended Credit Agreement, which expires on June 21, 2022, requires the Company to maintain certain monthly adjusted quick ratio and quarterly minimum consolidated adjusted earnings before income taxes, depreciation and amortization. At July 31, 2021 and January 31, 2021, the Company had no amounts outstanding under the Credit Agreement.