As part of the Business Combination, the Predecessor’s Revolver, U.K. Revolver, Senior secured notes, and Seller notes (see Predecessor section below for a discussion of these agreements) were all extinguished and the Company entered into (i) a Term Loan Agreement, dated among the Company, certain subsidiaries of the Company, Credit Suisse AG, Cayman Islands Branch as administrative agent and Credit Suisse Loan Funding LLC, Jefferies Finance LLC and Stifel Nicolaus & Company Incorporated LLC as joint lead arrangers and joint bookrunners and (the “Term Loan Agreement”) (ii) a Credit Agreement, dated among the Company, certain subsidiaries of the Company, Wells Fargo Bank, National Association, as agent, sole lead arranger and sole bookrunner, and the other parties thereto (“ABL Credit Agreement”). Summarized terms of those debt agreements are included below.

 

 

Summarized terms of the Term Loan Agreement are as follows:

 

 

The outstanding balance under the Term Loan Agreement as of was million. The Company’s interest on borrowings under the Term Loan Agreement bear interest using the London Inter-bank Offered Rate (LIBOR) as the base rate plus an applicable margin in line with the summarized terms of the Term Loan Agreement as described above.

 

Future maturities of the Term Loan are as follows:

 

Years ended October 31:
(in thousands)
2019		$	17,850
2020			17,850
2021			17,850
2022			17,850
2023			17,850
Thereafter			248,579
		$	337,829

 

 

Summarized terms of the ABL Credit Agreement are as follows:

 

 

The outstanding balance under the ABL Credit Agreement as of was million.

 

 

 

The Predecessor had a revolving loan agreement (the Revolver). Summarized terms of the agreement were as follows:

 

 

As of the outstanding balance of the Revolver was million and the Predecessor was in compliance with the financial covenant.

 

 

The Predecessor had a revolving loan agreement (the “U.K. Revolver”) associated with the acquisition of Camfaud in The U.K. Revolver had a maximum borrowing capacity of approximately million and bore interest at LIBOR plus The U.K. Revolver required the Predecessor maintain a maximum ratio of total fixed charges.

 

As of the outstanding balance of the U.K. Revolver was million and the Predecessor was in compliance with the financial covenant.

 

 

In the Predecessor issued million in senior secured notes through a high-yield bond offering under SEC Rule (“Senior Notes”). In the Predecessor issued additional senior secured notes of million as an incremental borrowing with the same terms and form as the original Senior Notes.

 

Summarized terms of the Senior Notes were as follows:

 

 

Over the period of through the Predecessor repurchased and retired approximately million, in the aggregate, of principal of the Senior Notes.

 

In the Predecessor completed an exchange of substantially all outstanding existing Senior Notes for newly issued senior secured notes (“New Senior Notes”). Terms of the New Senior Notes were identical to the Senior Notes except that the maturity date was extended to

 

In conjunction with the acquisition of the O’Brien Companies (Note ) in the Predecessor issued additional New Senior Notes with a principal amount of million at a percent premium for a total purchase price of million. The million has been recorded by the Company as a debt premium and will be amortized over the life of the New Senior Notes using the effective interest method.

 

The outstanding balance of the original Senior Notes outstanding as of was The outstanding balance of the New Senior Notes as of was million.

 

 

In connection with the acquisitions of the Camfaud and Reilly in and respectively, the Predecessor entered into separate loan agreements with the former owners of the Camfaud and Reilly for million and million, respectively (collectively, the “Seller Notes”). The Seller Note with respect to Camfaud bore interest at per annum and all principal plus accrued interest was due upon the earlier of; () months after the U.K. Revolver is repaid in full, () months after the acquisition date (or () the date on which the Predecessor suffers an insolvency event. The Seller Note with respect to Reilly bore interest at per annum and all principal plus accrued interest are due years after the acquisition date (The Seller Notes were unsecured.

 

In connection with the Business Combination, the Company repaid its existing credit facilities in full and replaced them with the Term Loan Agreement and the ABL Credit Agreement. The Company also incurred an aggregate of million of costs related to the extinguishment of its existing debts, including the write-off of unamortized borrowing costs and an early extinguishment fee paid to its lenders. The amount has been reflected in the as debt extinguishment costs in the Predecessor’s consolidated statement of income for the period ended

 

The table below is a summary of the composition of the Company’s long-term debt balances at for the Successor and at for the Predecessor. Note that the term loan is combined for short term and long term balances.

 

		Successor				Predecessor
		January 31,				October 31,
(in thousands)		2019				2018
Term loan		$	357,000			$	-
Senior secured notes			-				167,553
Seller notes			-				8,292
			357,000				175,845
Plus unamortized premium on debt			-				540
Less unamortized deferred financing costs			(19,171	)			(2,915	)
Total long term debt		$	337,829			$	173,470

In connection with the Merger, on the Company entered into a revolving loan agreement (the Revolver) with a maximum borrowing capacity of which was increased to in The Revolver bears interest at the LIBOR rate plus an applicable margin. The applicable margin resets quarterly and is (a) percent, (b) percent or (c)  percent if the quarterly average excess availability is (a) at least percent, (b) less than percent and at least percent and (c) less than percent, respectively. The Revolver expires on Interest is due monthly and the outstanding principal balance is due upon maturity. The Revolver is secured by substantially all assets of the Company and requires that the Company maintain a minimum fixed charge coverage ratio. In conjunction with the Senior Note Exchange (see below) in the borrowing capacity was increased to and the maturity date was extended to In addition, applicable margin for the interest rate was decreased to (a) percent, (b) percent or (c) percent if the quarterly average excess availability is (a) at least percent, (b) less than percent and at least percent and (c) less than percent, respectively. On of the Revolver balance was transferred to a -month line of credit with a separate LIBOR interest rate which was percent as of

 

The Revolver requires that the Company maintain a maximum ratio of total fixed charges, which include interest, principal payments, taxes and management fees to EBITDA (earnings before interest expense, taxes, depreciation and amortization) less capital expenditures during the term of the Revolver. As of the Company was in compliance with the financial covenant under the Revolver.

 

The outstanding balance of the Revolver as of and was and respectively.

 

In connection with the acquisition of the Camfaud in see Note ), Camfaud entered into a revolving loan agreement (the UK Revolver) with a maximum borrowing capacity of approximately The UK Revolver bears interest at the LIBOR rate plus percent and expires in The UK Revolver is secured by substantially all assets of Camfaud. The outstanding balance of the UK Revolver as of and was and respectively.

 

The UK Revolver requires that the Company maintain a maximum ratio of total fixed charges, which include interest, principal payments, taxes and management fees to EBITDA (earnings before interest expense, taxes, depreciation and amortization) less capital expenditures during the term of the Revolver. As of the Company was in compliance with the financial covenant under the Revolver.

 

To finance the Merger on the Company issued senior secured notes through a high-yield bond offering under SEC Rule (Senior Notes). The offering raised of proceeds for the Company. The Senior Notes mature on and bear interest at percent per annum. Interest payments are due every and commencing Principal is due upon maturity. The Senior Notes are secured by substantially all assets of the Company and contain various non-financial covenants.

 

The Senior Notes contain a number of significant restrictive covenants. Such restrictive covenants, among other things, restrict, subject to certain exceptions, the Company’s restricted subsidiaries’ ability to incur additional indebtedness and make guarantees; create liens on assets; pay dividends and distributions or repurchase their capital stock; make investments, loans and advances, including acquisitions; engage in mergers, consolidations, dissolutions or similar transactions; sell or otherwise dispose of assets, engage in certain transactions with affiliates; enter into certain restrictive agreements.

 

To finance the acquisition of the Camfaud (see Note ), in the Company issued additional senior secured notes of as an incremental borrowing with the same terms and form as the original Senior Notes.

 

In the Company repurchased and retired approximately of outstanding Senior Notes for a purchase price of approximately plus accrued interest of approximately In the Company repurchased and retired of outstanding Senior Notes for a purchase price of plus accrued interest of approximately In the Company repurchased and retired approximately of outstanding Senior Notes for a purchase price of approximately plus accrued interest of approximately In the Company repurchased and retired approximately of outstanding Senior Notes for a purchase price of approximately plus accrued interest of approximately In the Company repurchased and retired approximately of outstanding Senior Notes for a purchase price of approximately plus accrued interest of approximately

 

As a result of these repurchases, the Company recognized a loss of for the difference between the carrying amount of the Senior Notes, plus accrued interest, and the repurchase price, and also recognized a loss of related to the write off of deferred loan fees (see Note ) for the year ended There were such repurchases for the year ended The net loss has been presented in the accompanying consolidated statements of income as a loss on extinguishment of debt for the year ended The difference between the carrying amount and the reacquisition price of the debt, net of unamortized loan fees, has been presented in the accompanying consolidated statements of income as a (loss) gain on extinguishment of debt.

 

On the Company issued a Notice of Early Tender to exchange their Senior Notes for newly issued senior secured notes (New Senior Notes). Substantially all investors exchanged their outstanding notes (the Senior Note Exchange), which settled in The New Senior Notes bear interest at percent per annum and mature on The Company will make interest payments on and of each year. The outstanding balance of the original Senior Notes outstanding as of and was and respectively. The outstanding balance of the New Senior Notes outstanding as of and was and respectively.

 

After settlement of the New Senior Notes, the Company increased the total borrowing capacity of the Revolver, for which the proceeds were used to pay off the unsecured note and to pay accrued and unpaid dividends on the percent participating preferred stockholders ().

 

In conjunction with the acquisition of the O’Brien Companies (Note ), in the Company issued additional New Senior Notes with a principal amount of at a percent premium for a total purchase price of The has been recorded by the Company as a debt premium and will be amortized over the life of the New Senior Notes using the effective interest method.

 

To finance the Merger, on the Company entered into a loan agreement with of its shareholders. The note matures on and bears interest at percent per annum. Interest payments are due quarterly on and every year. Principal, along with any accrued and unpaid interest, is due upon maturity. The Company elect to have the interest paid-in kind (PIK). If the Company elects to pay PIK interest, the accrued interest will be added to the outstanding balance of the note and payable upon maturity. As of and all interest associated with the PIK has been paid by the Company. The unsecured notes contain various non-financial covenants.

 

As part of the unsecured note, the Company issued shares of common stock to the lender. As such, the proceeds of the unsecured note have been allocated to the debt and common stock based on their relative fair values. The amount allocated to common stock was which was recorded as a discount on the debt. The discount is amortized to interest expense over the remaining life of the loan using the effective interest method. During the years ended and amortization of the discount was and respectively.

 

In connection with the Senior Note Exchange on the Company repaid the unsecured note, including accrued interest of Upon extinguishment, the Company incurred a prepayment penalty fee of which has been included in loss on debt extinguishment on the accompanying consolidated statements of income. The Company also wrote off the remaining unamortized discount of which has also been included in loss on extinguishment of debt on the accompanying consolidated statements of income. The Company wrote off of unamortized loan fees, including accumulated amortization of Net write-off is included in the loss on extinguishment of debt on the consolidated statements of income for the year ended

 

In connection with the acquisitions of Camfaud and Reilly in and see Note ), respectively, the Company entered into loan agreements with the former owners of the Camfaud and Reilly for an aggregate amount of and respectively, (collectively, the Seller Notes). The Camfaud Note bears interest at percent per annum and all principal plus accrued interest are due upon the earlier of; () months after the UK Revolver is repaid in full, () months after the acquisition date (or () the date on which the Company suffers an insolvency event. The Reilly Note bears interest at percent per annum and all principal plus accrued interest are due years after the acquisition date (The Seller Notes are unsecured.

 

The following is a summary of the Company’s long-term debt as of and

 

		2018				2017
Senior secured notes		$	167,553,000			$	152,553,000
Seller notes			8,292,050				8,626,150
			175,845,050				161,179,150
Plus unamortized premium on debt			539,535				327,473
Less unamortized deferred financing costs			(2,914,520	)			(4,521,793	)
Total long term debt		$	173,470,065			$	156,984,830

 

Future maturities of long-term debt are as follows:

Years ending October 31:
2019		$	-
2020			8,292,050
2021			1,266,000
2022			-
2023			166,287,000
Thereafter			-
		$	175,845,050