DEBT

The components of debt are as follows:



	June 30, 2012									December 31, 2011
	Principal			Unamortized Premium (Discount)			Total			Principal		Unamortized Premium (Discount)			Total
	(In Thousands)
Credit Facility	$	348,000		$	—		$	348,000		$	105,000	$	—		$	105,000
7% Senior Subordinated Notes due 2013	12			—			12			12		—			12
8½% Senior Notes due 2014	600,000			(9,487		)	590,513			600,000		(12,389		)	587,611
7¼% Senior Notes due 2019	1,000,000			393			1,000,393			1,000,000		421			1,000,421
Total debt	$	1,948,012		$	(9,094	)	$	1,938,918		$	1,705,012	$	(11,968	)	$	1,693,044
Less: current portion of long-term debt⁽¹⁾	(12		)	—			(12		)	—		—			—
Long-term debt	$	1,948,000		$	(9,094	)	$	1,938,906		$	1,705,012	$	(11,968	)	$	1,693,044

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(1)	Due June 2013.

Bank Credit Facility

As of June 30, 2012, the Company had a $1.5 billion credit facility (the “Credit Facility”) with a syndicate of banks led by JPMorgan Chase Bank, N.A., which matures in June 2016. The size of the Credit Facility may be increased by $300.0 million, to a total of $1.8 billion, upon agreement between the applicable lenders and Forest.

Forest’s availability under the Credit Facility is governed by a borrowing base. As of June 30, 2012, the borrowing base under the Credit Facility was $1.25 billion. The determination of the borrowing base is made by the lenders in their sole discretion, on a semi-annual basis, taking into consideration the estimated value of Forest’s oil and gas properties based on pricing models determined by the lenders at such time, in accordance with the lenders’ customary practices for oil and gas loans. The available borrowing amount under the Credit Facility could increase or decrease based on such redetermination. In addition to the scheduled semi-annual redeterminations, Forest and the lenders each have discretion at any time, but not more often than once during a calendar year, to have the borrowing base redetermined. The borrowing base is also subject to automatic adjustments if certain events occur. A lowering of the borrowing base could require Forest to repay indebtedness in excess of the borrowing base in order to cover the deficiency. The borrowing base was reaffirmed at $1.25 billion in April 2012 and the next scheduled redetermination of the borrowing base will occur on or about November 1, 2012. The Credit Facility is collateralized by Forest’s assets, and Forest is required to mortgage and grant a security interest in 75% of the present value of the estimated proved oil and gas properties and related assets of Forest and its U.S. subsidiaries.

The Credit Facility includes terms and covenants that place limitations on certain types of activities, including restrictions or requirements with respect to additional debt, liens, asset sales, hedging activities, investments, dividends, mergers, and acquisitions, and also includes a financial covenant. The Credit Facility provides that Forest will not permit its ratio of total debt outstanding to EBITDA (as adjusted for non-cash charges) for a trailing twelve-month period to be greater than 4.5 to 1.0 at any time.

At June 30, 2012, there were outstanding borrowings of $348.0 million under the Credit Facility at a weighted average interest rate of 2.0% and Forest had used the Credit Facility for $1.8 million in letters of credit, leaving an unused borrowing amount under the Credit Facility of $900.2 million.