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Our principal exposure to market risk relates to changes in interest rates.
−Removed: We invest our cash and cash equivalents in money market funds and short-term corporate and municipal bonds.
−Removed: As of September 30, 2021, we held $133.7 million in cash and cash equivalents.
+Added: We invest our cash and cash equivalents and short-term investments in money market funds and short-term corporate and municipal bonds.
+Added: As of September 30, 2022, we held $66.5 million in cash and cash equivalents and $28.9 million in held-to-maturity investments.
During the fiscal year ended September 30, 2022, we earned interest income of $0.5 million.
As we have a restrictive investment policy, our financial exposure to fluctuations in interest rates related to our interest income is expected to remain low.
−Removed: We do not believe that the value or liquidity of our cash and cash equivalents and investments have been significantly impacted by current market events.
+Added: We do not believe that the value or liquidity of our cash and cash equivalents and held-to-maturity investments have been significantly impacted by current market events.
On May 12, 2021, we entered into a credit agreement to finance the Avondale property through a $31.2 million term loan that bears interest at the rate of LIBOR plus 2.0% with a maturity of seven years.
As of September 30, 2022, the fair value of our long-term debt was $30.1 million and bears interest on the outstanding principal amount at a rate equal to the LIBOR plus 2.0%, which was 4.56% as of September 30, 2022.
−Removed: We believe the carrying value of the debt approximates fair value as the interest rate is a floating rate equal to the LIBOR plus 2.0%, which is representative of market rates for similar instruments.
+Added: On April 14, 2022, we entered into a credit agreement to finance the Lisle Campus through a $38.0 million term loan that bears interest at the rate of SOFR plus 2.0% with a maturity of seven years.
+Added: As of September 30, 2022, the fair value of our long-term debt was $38.0 million and bears interest on the outstanding principal amount at a rate equal to the SOFR plus 2.0%, which was 4.51% as of September 30, 2022.
+Added: We believe the carrying value of the debt approximates fair value as the interest rate is a floating rate equal to the LIBOR or SOFR plus 2.0%, which is representative of market rates for similar instruments.
It is anticipated that the fair market value of our debt will continue to be immaterially affected by fluctuations in interest rates and we do not believe that the value of our debt has been significantly impacted by current market events.
−Removed: The variable rate of interest on our long-term debt can expose us to interest rate volatility due to changes in LIBOR.
−Removed: To mitigate this exposure, on May 12, 2021, we entered into an interest rate swap agreement that effectively fixes the interest rate on 50% of the principal amount of the term loan at 3.5% for the entire loan term.
+Added: The variable rate of interest on our long-term debt can expose us to interest rate volatility due to changes in LIBOR and SOFR.
+Added: To mitigate this exposure, we entered into interest rate swap agreements that effectively fix the interest rates on 50% of the principal amounts of the term loans at 3.5% and 4.69% for the entire loan term on our Avondale debt and Lisle debt, respectively.
During the fiscal year ended September 30, 2022, we recorded interest expense of $2.0 million on our outstanding debt.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.