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Debt
12 Months Ended
Apr. 30, 2015
Debt Disclosure [Abstract]  
Debt

10. Debt

Prior Credit Facility

On July 18, 2007, the Company entered into a loan and security agreement (“Loan Agreement”) with Comerica Bank which was amended from time to time. The Loan Agreement provided for a revolving line of credit with a borrowing capacity of up to the lesser of (a) $30.0 million or (b) 100% of eligible monthly service fees as defined in the Loan Agreement, inclusive of any amounts outstanding under the $2.7 million sublimit for corporate credit card and letter of credit services. The revolving line of credit was set to expire on January 31, 2015. The revolving line of credit bore interest at the prime base rate as defined in the Loan Agreement except during any period of time during which the line bore interest at the daily adjusting LIBOR rate plus 2.5%. Borrowings under the revolving line of credit were collateralized by substantially all assets of the Company and its U.S. subsidiaries. As of April 30, 2014, the Company had drawn down $1.6 million in the form of a letter of credit as security deposits for its leased corporate headquarters which expired on December 31, 2014. As per the provision of the lease, the Company is required to maintain this security deposit until December 31, 2015, then end of the contractual term of the lease. The Company is currently in the process of renewing this letter of credit. As of October 31, 2014, the Company had drawn down an additional $0.3 million in the form of letters of credit as security deposits for its leased San Francisco office space. On February 21, 2014, the Company drew down $27.0 million of its unused balance of the revolving line of credit which was repaid on November 21, 2014 upon execution of the Amended and Restated Credit Facility. The outstanding loan balance as of April 30, 2014, was subject to all terms and conditions described above in the Loan Agreement and its subsequent amendments. The unused balance of the revolving line of credit was $1.4 million as of April 30, 2014. The Company was in compliance with all financial covenants as of April 30, 2014.

Amended and Restated Credit Facility

On November 21, 2014, the Company entered into an Amended and Restated Credit Facility (the “Credit Facility”) with Comerica Bank which provides for a secured, revolving line of credit of up to $70.0 million, with a sublimit of $3.0 million for the incurrence of swingline loans and a sublimit of $15.0 million for the issuance of letters of credit. The Credit Facility amended and restated the Loan Agreement and all letters of credits under the Loan Agreement were transferred to the Credit Facility. Borrowings under the Credit Facility are collateralized by substantially all assets of the Company and of its U.S. subsidiaries. The revolving line of credit bears interest at the adjusted LIBOR rate plus 3.5%. On November 21, 2014, the Company drew down $57.0 million of the unused balance of the Credit Facility, of which, $27.0 million was used to repay the outstanding balance on the Loan Agreement. On December 4, 2014, the Company drew down $8.0 million in the form of a letter of credit as a security deposit for the lease for the Company’s new headquarters (See Note 15). In January 2015, the Company transferred a $1.0 million Pledge and Security Agreement to be included as a form of a letter of credit under the Credit Facility, resulting in an unused balance of $3.7 million as of April 30, 2015. The Credit Facility expires on November 21, 2017 with all advances immediately due and payable. The Company was in compliance with all financial covenants contained in the Credit Facility as of April 30, 2015.

 

The Company did not recognize a gain or loss on the extinguishment of the Loan Agreement. The Company incurred $0.7 million of fees in connection with the Amended and Restated Credit Facility which were capitalized and are being amortized to interest expense using the straight-line method, which approximates the effective interest method, over the life of the Credit Facility. For the fiscal year 2015, the Company incurred amortization expense on deferred financing costs of $0.1 million.

Pledge and Security Agreement

On November 4, 2008, the Company entered into a Pledge and Security Agreement with Comerica for a standby letter of credit for credit card services from a separate financial institution which was amended on October 29, 2014 to increase the standby letter of credit by $0.5 million to $1.0 million. The Company pledged a security interest in its money market account, in which the balance must equal at least the credit extended. This letter of credit expires annually, and the pledged security interest is recorded as short-term restricted cash in the Company’s consolidated financial statements. In January 2015, the Company transferred the $1.0 million Pledge and Security Agreement to be included as a form of letter of credit under the Credit Facility, therefore the Pledge and Security Agreement obligations are no longer considered restricted cash.