NOTE 9—CREDIT FACILITIES

Senior Line of Credit

The Partnership maintains a senior secured revolving credit agreement, as amended, (the “Senior Line of Credit”). The Senior Line of Credit has a maximum credit amount of $1.0 billion. On October 28, 2015, the Senior Line of Credit was further amended to extend the term of the agreement from February 3, 2017 to February 4, 2019. The amount of the borrowing base is derived from the value of the Partnership’s oil and natural gas properties determined by the lender syndicate using pricing assumptions that often differ from strip prices. The borrowing base was $700.0 million at December 31, 2014. The Partnership’s semi-annual borrowing base redetermination process resulted in a decrease of the borrowing base to $600.0 million, effective April 10, 2015. Effective October 28, 2015, the borrowing base was further decreased to $550.0 million. Drawings on the Senior Line of Credit are used for the acquisition of oil and natural gas properties and for other general business purposes.

Borrowings under the Senior Line of Credit bear interest at LIBOR plus a margin between 1.50% and 2.50%, or prime rate plus a margin between 0.50% and 1.50%, with the margin depending on the borrowing base utilization percentage of the loan, as detailed in the table below. The prime rate is determined to be the higher of the financial institution’s prime rate or the federal funds effective rate plus 0.50% per annum.

	Borrowing Base Utilization
Borrowing type	<25%			≥25% <50%			≥50% <75%			≥75% <90%			≥90%
Eurodollar Margin		1.50	%		1.75	%		2.00	%		2.25	%		2.50	%
Base Rate Margin		0.50	%		0.75	%		1.00	%		1.25	%		1.50	%

The weighted-average interest rate of the Senior Line of Credit was 1.92% and 2.41% as of December 31, 2015 and 2014, respectively. Accrued interest is payable at the end of each calendar quarter or at the end of each interest period, unless the interest period is longer than 90 days in which case interest is payable at the end of every 90-day period. In addition, a commitment fee is payable at the end of each calendar quarter based on either a rate of 0.375% if the borrowing base utilization percentage is less than 50%, or 0.500% per annum if the borrowing base utilization percentage is equal to or greater than 50%. The Senior Line of Credit is secured by a majority of the Partnership’s oil and natural gas production and assets.

The Senior Line of Credit contains various limitations on future borrowings, leases, hedging, and sales of assets. Additionally, the Senior Line of Credit requires the Partnership to maintain a current ratio of not less than 1.0:1.0 and a ratio of total debt to EBITDAX (Earnings before Interest, Taxes, Depreciation, Amortization, and Exploration) of not more than 3.5:1.0. As of December 31, 2015, the Partnership was in compliance with all financial covenants in the Senior Line of Credit.

The aggregate principal balance outstanding was $66.0 million and $394.0 million at December 31, 2015 and 2014, respectively. The unused portion of the available borrowings under the Senior Line of Credit was $484.0 million and $306.0 million at December 31, 2015 and 2014, respectively. Refer to Note 1 – Business and Basis of Presentation for a discussion of the use of proceeds from the IPO.

BSNR II-B Revolving Credit Facility

Black Stone Natural Resources II-B, L.P., a consolidated subsidiary of the Predecessor, obtained a $50.0 million five-year revolving credit facility dated November 9, 2005, as amended, on November 3, 2010, (“BSNR II-B Revolving Credit Facility”) with a financial institution as the administrative agent and the lender. The Predecessor repaid the outstanding principal balance of $19.1 million on March 28, 2013, and the BSNR II-B Revolving Credit Facility was terminated on April 30, 2013.

BSNR III-B Revolving Credit Facility

Black Stone Natural Resources III-B, L.P., a consolidated subsidiary of the Predecessor, obtained a $100.0 million revolving credit facility dated October 10, 2008 (“BSNR III-B Revolving Credit Facility”), with a financial institution as the administrative agent and the lender. On December 27, 2012, the BSNR III-B Revolving Credit Facility was amended and extended through November 30, 2017. The Predecessor repaid the outstanding principal balance of $27.0 million and terminated the BSNR III-B Revolving Credit Facility on May 15, 2013.