DEBT AND CAPITAL LEASE OBLIGATIONS

1.75% CONVERTIBLE DEBENTURES

In October 2012, the Company issued $396.75 million aggregate principal amount of 1.75% senior unsecured convertible debentures due October 15, 2032 (1.75% debentures). Each $1,000 principal amount of these 1.75% debentures is initially convertible, under certain circumstances and during certain periods, into 60.4961 shares (subject to customary anti-dilution adjustments) of the Company's common stock, which represents an initial conversion price of $16.53 per share. The 1.75% debentures also include an embedded conversion enhancement feature that is equivalent to including each debenture with a warrant initially exercisable for 30.2481 shares at an exercise price of $16.53 per share (also subject to customary anti-dilution adjustments). The Company, at its election, may settle conversions of the 1.75% debentures in cash, shares of its common stock or any combination of cash and shares of its common stock.

Holders have the right to redeem their 1.75% debentures at face value plus accrued and unpaid interest on October 15, of each of 2019, 2024, 2029, and upon the occurrence of certain corporate events. The Company will have the right to call the 1.75% debentures at any time on or after October 20, 2019.

The 1.75% debentures were bifurcated under U.S. GAAP into separate debt and equity components, and reflect an effective maturity (to the first optional redemption date) of seven years. The residual amount of $141.6 million recorded in equity is treated for accounting purposes as additional debt discount and accreted as an additional non-cash interest charge to earnings over the expected life. Debt and equity issuance costs totaling approximately $12.4 million were deducted from the gross proceeds of the offering of the 1.75% debentures, and the debt portion is being amortized ratably over seven years.

In the third quarter of 2015, the Company repurchased $61.6 million of the outstanding principal of the 1.75% debentures, paying cash of $59.4 million. The Company reduced the debt component by $50.7 million, which includes a reduction of the debt discount by $10.9 million. The difference between the book value and the fair value (including $0.7 million of debt and equity issuance costs) of the debt component resulted in a $4.2 million loss.

The 1.75% debentures have an effective interest rate of 8.50% and a stated interest rate of 1.75% with interest paid semi-annually. The balance outstanding at March 31, 2016 was approximately $259.1 million which is net of unamortized discount of $72.4 million and $3.6 million deferred debt issue costs. The balance outstanding at December 31, 2015 was $254.6 million, which was net of unamortized discount of $76.8 million and $3.8 million of deferred debt issue costs.

1.875% CONVERTIBLE DEBENTURES

Holders of the remaining $0.5 million of outstanding 1.875% debentures may require the Company to redeem their 1.875% debentures at face value on March 15, 2018 or March 15, 2023, or at any time before March 15, 2028 upon the occurrence of certain events including a change in control. Effective March 22, 2013, the Company has the right at its discretion to redeem the remaining $0.5 million of outstanding 1.875% debentures for cash at any time prior to maturity. The outstanding balance at March 31, 2016 and December 31, 2015, of $0.5 million aggregate principal amount, is reported as a long-term debt obligation.

In the third quarter of 2015, the Company repurchased $1.7 million of the outstanding principal of the 1.875% debentures, paying cash of $1.6 million and recorded a gain of approximately $0.1 million.

ASSET-BACKED REVOLVING CREDIT FACILITY

In December 2011, the Company signed a $100.0 million asset-backed revolving credit agreement incurring debt issuance costs of $1.1 million. In January 2012, the Company completed the syndication of this facility and simultaneously expanded its maximum line of credit to $125.0 million, incurring additional debt issuance costs of $0.2 million. The Company also paid an unused line fee on the committed but unutilized balance under the facility at a rate per annum of 0.375% or 0.5%, depending on utilization of the facility.

The Company terminated this credit facility on December 31, 2015, incurring expenses and fees of approximately $0.2 million.

The following table reflects the amortization of debt issuance costs, interest expense and cash payments on the Company's outstanding debt for the three months ended March 31, 2016 and 2015:



	Three months ended
	March 31,
(In thousands)	2016		2015
1.75% Convertible Debentures
Amortization of debt issuance costs	$	217	$	236
Interest expense, net of capitalized interest	$	3,993	$	5,001
Cash payments for interest	$	—	$	3,472

1.875% Convertible Debentures
Interest expense, net of capitalized interest	$	—	$	—
Cash payments for interest	$	5	$	—

Asset-Backed Revolving Credit Facility
Amortization of debt issuance costs	$	—	$	67
Fees	$	—	$	251

The Company's total current and long-term debt balances at March 31, 2016 and December 31, 2015 were as follows:



	March 31, 2016					December 31, 2015
(In thousands)	Current		Long-Term			Current		Long-Term
1.75% Convertible Debentures
Aggregate principal	$	—	$	335,150		$	—	$	335,150
Debt discount	—		(72,409		)	—		(76,754		)
Deferred debt issue costs	—		(3,604		)	—		(3,821		)
Debt balance	—		259,137			—		254,575
1.875% Convertible Debentures	—		524			—		524
Capital Lease Obligation	46		—			580		—
Small Land Purchase	—		—			77		—
Total debt balances	$	46	$	259,661		$	657	$	255,099

CAPITALIZED INTEREST

The Company capitalizes interest incurred on its various debt instruments as a cost of specific and identified areas under development. For the three months ended March 31, 2016 and 2015, the Company capitalized interest of $1.9 million and $1.3 million, respectively. Capitalized interest is recorded as a reduction to Interest expense in the Company's Consolidated Statements of Comprehensive (Loss) Income.