Debt

12 Months Ended

Jul. 31, 2021

Debt Disclosure [Abstract]

Long-Term Obligations

Debt

On August 1, 2019, the Company and certain of its subsidiaries entered into an unsecured $200 million multi-currency revolving loan agreement with a group of five banks. Under this revolving loan agreement, the Company has the option to select either a Eurocurrency rate loan that bears interest at the LIBOR rate plus a margin based on the Company's consolidated net leverage ratio or a base interest rate (based upon the higher of the federal funds rate plus 0.5%, the prime rate of the Bank of Montreal plus a margin based on the Company’s consolidated net leverage ratio, or the Eurocurrency base rate at the LIBOR rate plus a margin based on the Company’s consolidated net leverage ratio plus 1%). At the Company's option, and subject to certain conditions, the available amount under the revolving loan agreement may be increased from $200 million to $400 million.

In June 2021, the Company drew down $75.0 million from its revolving loan agreement to fund a portion of the purchase price of the acquisition of Code. Prior to July 31, 2021, the Company repaid $37.0 million of the borrowing with cash on hand. During the year ended July 31, 2021, the maximum amount outstanding on the revolving loan agreement was $75.0 million. As of July 31, 2021, the outstanding balance on the credit facility was $38.0 million and there was $159.1 million available for future borrowing under the credit facility, which can be increased to $359.1 million at the Company's option, subject to certain conditions. The revolving loan agreement has a final maturity date of August 1, 2024.

The Company’s revolving loan agreement requires it to maintain certain financial covenants, including a ratio of debt to the trailing twelve months EBITDA, as defined in the agreement, of not more than a 3.5 to 1.0 ratio (leverage ratio) and the trailing twelve months EBITDA to interest expense of not less than a 3.0 to 1.0 ratio (interest expense coverage ratio). As of July 31, 2021, the Company was in compliance with these financial covenants, with a ratio of debt to EBITDA, as defined by the agreements, equal to 0.2 to 1.0 and the interest expense coverage ratio equal to 480.6 to 1.0.

As of July 31, 2021, borrowings on the revolving loan agreement were as follows:

	July 31, 2021		Interest Rate
USD-denominated borrowing on revolving loan agreement	$	38,000	0.84	%

Due to the variable interest rate pricing of the Company's revolving debt, it is determined that the carrying value of the debt equals the fair value of the debt.

The Company had outstanding letters of credit of $2,901 and $3,116 at July 31, 2021 and 2020, respectively.