Note 5 – Long-Term Debt

Revolving Credit Facility

The Company’s Fifth Amended and Restated Credit Agreement, as amended, provides a maximum loan amount of $2.5 billion, current aggregate lender commitments of $1.5 billion, and a maturity date of December 10, 2019. The borrowing base is subject to regular semi-annual redeterminations. Effective as of October 7, 2015, the Company’s lenders decreased the borrowing base to $2.0 billion as part of the regularly scheduled semi-annual redetermination under the Credit Agreement. This expected reduction from $2.4 billion was primarily a result of the Company’s sale of its Mid-Continent assets, plus adjustments consistent with lower commodity prices. There was no change in the current aggregate lender commitments of $1.5 billion. The next redetermination date is scheduled for April 1, 2016. The borrowing base redetermination process under the credit facility considers the value of the Company’s proved oil and gas properties and commodity derivative contracts, as determined by the lender group. Borrowings under the facility are secured by mortgages on assets having a value equal to at least 75 percent of the total value of the Company’s proved oil and gas properties.

The Company must comply with certain financial and non-financial covenants under the terms of the Credit Agreement, including limitations on dividend payments and requirements to maintain certain financial ratios, which include debt to adjusted EBITDAX, as defined by the Credit Agreement as the ratio of debt to 12-month trailing adjusted EBITDAX, of less than 4.0 and an adjusted current ratio, as defined by the Credit Agreement, of no less than 1.0. The Company was in compliance with all financial and non-financial covenants under the Credit Agreement as of December 31, 2015, and through the filing date of this report.

Interest and commitment fees are accrued based on the borrowing base utilization grid below. Eurodollar loans accrue interest at the London Interbank Offered Rate plus the applicable margin from the utilization table below, and Alternate Base Rate (“ABR”) and swingline loans accrue interest at Prime plus the applicable margin from the utilization table below. Commitment fees are accrued on the unused portion of the aggregate commitment amount and are included in interest expense in the accompanying statements of operations.

Borrowing Base Utilization Grid



Borrowing Base Utilization Percentage	<25%		≥25% <50%		≥50% <75%		≥75% <90%		≥90%
Eurodollar Loans	1.250	%	1.500	%	1.750	%	2.000	%	2.250	%
ABR Loans or Swingline Loans	0.250	%	0.500	%	0.750	%	1.000	%	1.250	%
Commitment Fee Rate	0.300	%	0.300	%	0.350	%	0.375	%	0.375	%

The following table presents the outstanding balance, total amount of letters of credit, and available borrowing capacity under the Credit Agreement as of February 17, 2016, December 31, 2015, and December 31, 2014:



	As of February 17, 2016		As of December 31, 2015		As of December 31, 2014
	(in thousands)
Credit facility balance ⁽¹⁾	$	243,000	$	202,000	$	166,000
Letters of credit ⁽²⁾	$	200	$	200	$	808
Available borrowing capacity	$	1,256,800	$	1,297,800	$	1,333,192

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⁽¹⁾	Deferred financing costs attributable to the credit facility are presented as a component of other noncurrent assets on the accompanying balance sheets and thus are not deducted from the credit facility balance.


⁽²⁾	Letters of credit reduce the amount available under the credit facility on a dollar-for-dollar basis.

Senior Notes

The Senior Notes, net of unamortized deferred financing costs, line on the accompanying balance sheets as of December 31, 2015, and 2014, consisted of the following:



	As of December 31,
	2015						2014 ⁽¹⁾
	Senior Notes		Unamortized Deferred Financing Costs		Senior Notes, Net of Unamortized Deferred Financing Costs		Senior Notes		Unamortized Deferred Financing Costs		Senior Notes, Net of Unamortized Deferred Financing Costs
	(in thousands)
6.625% Notes due 2019	$	—	$	—	$	—	$	350,000	$	4,591	$	345,409
6.50% Notes due 2021	350,000		4,106		345,894		350,000		4,806		345,194
6.125% Notes due 2022	600,000		8,714		591,286		600,000		9,812		590,188
6.50% Notes due 2023	400,000		5,231		394,769		400,000		5,969		394,031
5.0% Notes due 2024	500,000		7,455		492,545		500,000		8,377		491,623
5.625% Notes due 2025	500,000		8,524		491,476		—		—		—
Total	$	2,350,000	$	34,030	$	2,315,970	$	2,200,000	$	33,555	$	2,166,445

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(1)	Prior period amounts have been reclassified to conform to the current period presentation on the accompanying balance sheets. Please refer to the section Recently Issued Accounting Standards in Note 1 – Summary of Significant Accounting Policies for additional discussion.

The Senior Notes are unsecured senior obligations and rank equal in right of payment with all of the Company’s existing and any future unsecured senior debt, and are senior in right of payment to any future subordinated debt. There are no subsidiary guarantors of the Senior Notes. The Company is subject to certain covenants under the indentures governing the Senior Notes that limit the Company’s ability to incur additional indebtedness, issue preferred stock, and make restricted payments, including dividends; however, the first $6.5 million of dividends paid each year are not restricted by the restricted payment covenant. The Company was in compliance with all covenants under its Senior Notes as of December 31, 2015, and through the filing date of this report. All Senior Notes are registered under the Securities Act as of December 31, 2015. The Company may redeem some or all of its Senior Notes prior to their maturity at redemption prices based on a make-whole amount plus accrued and unpaid interest as described in the indentures governing the notes.

2019 Notes

On May 7, 2015, the Company commenced a cash tender offer for any and all of its outstanding 6.625% Senior Notes due 2019 at a price of $1,036.88 per $1,000 of principal amount for all 2019 Notes tendered by May 20, 2015 (“Consent Payment Deadline”), and at a price of $1,006.88 per $1,000 of principal amount for all 2019 Notes properly tendered thereafter. On the Consent Payment Deadline, the Company received tenders and consents from the holders of approximately $242.9 million in aggregate principal amount, or approximately 69 percent, of its outstanding 2019 Notes in connection with the cash tender offer. Following its entry into the supplemental indenture dated as of May 21, 2015, to the indenture dated as of February 7, 2011, between the Company and U.S. Bank National Association, as Trustee, the Company accepted the 2019 Notes tendered as of the Consent Payment Deadline in exchange for payment of total consideration, including accrued interest, of approximately $256.2 million under the Tender Offer and Consent Solicitation. On June 5, 2015, the Company accepted $1.5 million of 2019 Notes tendered after the Consent Payment Deadline in exchange for payment of total consideration, including accrued interest, of approximately $1.6 million.

On June 22, 2015, the Company redeemed the remaining outstanding 2019 Notes at a redemption price of 103.313% of the principal amount for payment of total consideration, including accrued interest, of approximately $111.5 million.

The Company recorded a loss on extinguishment of debt related to the tender offer and redemption of its 2019 Notes of approximately $16.6 million for the quarter ended June 30, 2015. This amount includes approximately $12.5 million associated with the premium paid for the tender offer and redemption of the 2019 Notes and approximately $4.1 million related to the acceleration of unamortized deferred financing costs.

2021 Notes

On November 8, 2011, the Company issued $350.0 million in aggregate principal amount of 6.50% Senior Notes due 2021. The 2021 Notes were issued at par and mature on November 15, 2021. The Company received net proceeds of $343.1 million after deducting fees of $6.9 million, which are being amortized as deferred financing costs over the life of the 2021 Notes.

2022 Notes

On November 17, 2014, the Company issued $600.0 million in aggregate principal amount of 6.125% Senior Notes due 2022. The 2022 Notes were issued at par and mature on November 15, 2022. The Company received net proceeds of $590.0 million after deducting fees of $10.0 million, which are being amortized as deferred financing costs over the life of the 2022 Notes.

On November 17, 2014, the Company entered into a registration rights agreement that provided holders of the 2022 Notes certain registration rights under the Securities Act. The Company closed its offer to exchange its 2022 Notes for notes registered under the Securities Act on July 10, 2015.

2023 Notes

On June 29, 2012, the Company issued $400.0 million in aggregate principal amount of 6.50% Senior Notes due 2023. The 2023 Notes were issued at par and mature on January 1, 2023. The Company received net proceeds of $392.1 million after deducting fees of $7.9 million, which are being amortized as deferred financing costs over the life of the 2023 Notes.

2024 Notes

On May 20, 2013, the Company issued $500.0 million in aggregate principal amount of 5.0% Senior Notes due 2024. The 2024 Notes were issued at par and mature on January 15, 2024. The Company received net proceeds of $490.2 million after deducting fees of $9.8 million, which are being amortized as deferred financing costs over the life of the 2024 Notes.

2025 Notes

On May 21, 2015, the Company issued $500.0 million in aggregate principal amount of 5.625% Senior Notes due 2025. The 2025 Notes were issued at par and mature on June 1, 2025. The Company received net proceeds of $491.0 million after deducting fees of $9.0 million, which are being amortized as deferred financing costs over the life of the 2025 Notes. The net proceeds were used to fund the consideration paid to the tendering holders of the 2019 Notes and to redeem the remaining untendered 2019 Notes, as well as repay outstanding borrowings under the Credit Agreement and for general corporate purposes.

Capitalized Interest

Capitalized interest costs for the Company for the years ended December 31, 2015, 2014, and 2013, were $25.1 million, $16.2 million, and $11.0 million, respectively.