The following long-term debt and capital lease obligations were outstanding as of December 31, 2011 and 2010:


		December 31,
In thousands		2011		2010
Bank Credit Agreement		$	385,000	$	-
7½% Senior Subordinated Notes due 2013, including discount of $437			-		224,563
7½% Senior Subordinated Notes due 2015, including premium of $427			-		300,427
9½% Senior Subordinated Notes due 2016, including premium of $11,854 and $14,589, respectively			236,774		239,509
9¾% Senior Subordinated Notes due 2016, including discount of $17,854 and $22,139, respectively			408,496		404,211
8¼% Senior Subordinated Notes due 2020			996,273		996,273
6⅜% Senior Subordinated Notes due 2021			400,000		-
Other Subordinated Notes, including premium of $33 and $41, respectively			3,840		3,848
NEJD financing			163,677		167,331
Free State financing			79,597		81,188
Capital lease obligations			4,388		6,806
	Total		2,678,045		2,424,156
Less: current obligations			(8,316)		(7,948)
	Long-term debt and capital lease obligations	$	2,669,729	$	2,416,208

The parent company, Denbury Resources Inc. (“DRI”), is the sole issuer of all of our outstanding senior subordinated notes. DRI has no independent assets or operations. Each of the subsidiary guarantors is 100% owned by DRI; any subsidiaries of DRI other than the subsidiary guarantors are minor subsidiaries, and the guarantees are full and unconditional and joint and several.

In March 2010, we entered into a $1.6 billion revolving credit agreement with JPMorgan Chase Bank, N.A. (“JPMorgan”), as administrative agent, and other lenders as party thereto (the “Bank Credit Agreement”). Availability under the Bank Credit Agreement is subject to a borrowing base, which is redetermined semi-annually on or prior to May 1 and November 1 and upon requested special redeterminations. The borrowing base is adjusted at the banks' discretion and is based in part upon external factors over which we have no control. If the borrowing base were to be less than outstanding borrowings under the Bank Credit Agreement, we would be required to repay the deficit over a period not to exceed four months. As part of the semi-annual review completed in September 2011 pursuant to the terms of the Bank Credit Agreement, our borrowing base was reaffirmed at $1.6 billion. Loans under the Bank Credit Agreement mature in May 2016.

The Bank Credit Agreement is secured by substantially all of the proved oil and natural gas properties of our restricted subsidiaries and by the equity interests of our restricted subsidiaries. In addition, our obligations under the Bank Credit Agreement are guaranteed jointly and severally by all of our subsidiaries, other than minor subsidiaries.

The Bank Credit Agreement contains several restrictive covenants including, among others:

The Bank Credit Agreement also includes a limitation on the aggregate amount of forecasted oil and natural gas production that can be economically hedged with oil or natural gas derivative contracts.

Loans under the Bank Credit Agreement are subject to varying rates of interest based on (1) the total outstanding borrowings in relation to the borrowing base and (2) whether the loan is a Eurodollar loan or a base rate loan. Eurodollar loans bear interest at the Adjusted Eurodollar Rate (as defined in the Bank Credit Agreement) plus the applicable margin of 1.5% to 2.5% based on the ratio of outstanding borrowings to the borrowing base, and base rate loans bear interest at the Base Rate (as defined in the Bank Credit Agreement) plus the applicable margin of 0.5% to 1.5% based on the ratio of outstanding borrowings to the borrowing base. The “Eurodollar rate” for any interest period (either one, two, three, six, nine or twelve months, as selected by us) is the rate per year equal to LIBOR, as published by Reuters or another source designated by JPMorgan, for deposits in dollars for a similar interest period. The “base rate” is calculated as the highest of (1) the annual rate of interest announced by JPMorgan as its “prime rate,” (2) the federal funds effective rate plus 0.5%, and (3) the Adjusted Eurodollar Rate for a one-month interest period plus 1.0%. We incur a commitment fee of either 0.375% or 0.5%, based on the ratio of outstanding borrowings on the borrowing base, on the unused portion of the credit facility or, if less, the borrowing base.

7½% Senior Subordinated Notes due 2013 and 7½% Senior Subordinated Notes due 2015

In March 2003, we issued $225 million of 7½% Senior Subordinated Notes due 2013 (“2013 Notes”). The 2013 Notes, which carried a coupon rate of 7.5%, were sold at 99.135% of par. In December 2005, we issued $150 million of 7½% Senior Subordinated Notes due 2015, which carried a coupon rate of 7.5%, at par. In April 2007, we issued an additional $150 million of 7½% Senior Subordinated Notes due 2015 (collectively the “2015 Notes”) at 100.5% of par, equating to an effective yield to maturity of approximately 7.4%. On March 3, 2011, we purchased in a tender offer $169.6 million in principal of the 2013 Notes at 100.625% of par, and $220.9 million in principal of the 2015 Notes at 104.125% of par. We called the remaining 2013 and 2015 Notes, repurchasing all of the remaining outstanding 2015 Notes ($79.1 million) at 103.75% of par on March 21, 2011, and all of the remaining outstanding 2013 Notes ($55.4 million) at par on April 1, 2011. We recognized a $16.1 million loss during the year ended December 31, 2011 associated with the debt repurchases, which is included in our Unaudited Condensed Consolidated Statements of Operations under the caption “Loss on early extinguishment of debt”.

On March 9, 2010, upon closing of the Encore Merger, we became an obligor, as successor in interest to Encore, with respect to Encore's senior subordinated notes, which are governed by four indentures covering an aggregate original principal amount of $825 million. In conjunction with the closing of the Encore Merger, we and our subsidiaries other than minor subsidiaries entered into supplemental indentures to become subsidiary guarantors under Encore's senior subordinated notes, as required under the Encore indentures, as well as the indentures governing our senior subordinated notes. The Encore legacy subsidiaries, with permitted exceptions, became guarantors under the indentures that were in effect prior to the Encore Merger.

Tender Offers and Consent Solicitations for Encore's Senior Subordinated Notes; Supplements to Indentures Governing Encore's Senior Subordinated Notes

On March 10, 2010, we purchased in a cash tender offer $500.5 million of $600 million principal amount of Encore's senior subordinated notes that were governed by three of Encore's four indentures, leaving approximately $99.5 million of the $600 million of notes outstanding. Those indentures to which Encore was a party prior to the Encore Merger govern their 6¼% Senior Subordinated Notes due 2014, their 6% Senior Subordinated Notes due 2015 and their 7¼% Senior Subordinated Notes due 2017 (collectively, the “Other Subordinated Notes”).

The tender of the notes also constituted the delivery of consents of holders of the notes to eliminate or modify certain provisions contained in each of the three indentures governing the Other Subordinated Notes, which was sufficient to amend these three Encore indentures effective upon the date of the Encore Merger. The amendments of the three indentures governing the $600 million of Other Subordinated Notes eliminated most of the restrictive covenants and certain events of default in the indentures. The amendments do not apply to the 9½% Senior Subordinated Notes due 2016 (the “9½% Notes”). The Encore indentures required us to effect a second tender offer to repurchase, for 101% of the face amount, the $99.5 million of notes that remained outstanding after completion of the February 8, 2010 tender, plus an initial offer to purchase, for 101% of the face amount, the $225 million of outstanding 9½% Notes. In April 2010, we purchased approximately $95.7 million of these senior subordinated notes, leaving approximately $228.7 million of former Encore notes outstanding.

In addition to the three indentures that govern the Other Subordinated Notes, as a result of the Encore Merger, we also became successor in interest to Encore under the Encore indenture with respect to the 9½% Notes in the original principal amount of $225 million. Interest on the 9½% Notes is due semi-annually, on May 1 and November 1, at a rate of 9.5%. The 9½% Notes mature on May 1, 2016. We may redeem the 9½% Notes, in whole or in part at our option beginning May 1, 2013, at the following redemption prices: 104.75% after May 1, 2013, 102.375% after May 1, 2014 and 100% after May 1, 2015. Prior to May 1, 2012, we may, at our option, redeem up to an aggregate of 35% of the principal amount of the 9½% Notes at a price of 109.5% with the proceeds of certain equity offerings. In addition, at any time prior to May 1, 2013, we may redeem 100% of the principal amount of the 9½% Notes at a price equal to 100% of the principal amount plus a “make-whole” premium and accrued and unpaid interest. The material terms of the indenture governing the 9½% Notes include covenants requiring the filing of SEC reports, restricting certain payments, limiting indebtedness, restricting distributions from certain restricted subsidiaries, restricting affiliate transactions, restricting the creation of liens, requiring certain subsidiaries to deliver guarantees of the notes, requiring the delivery of certificates concerning compliance with the indenture, and covenants relating to mergers and consolidations.

All of the Encore indentures, including the indenture governing the 9½% Notes, have covenants limiting the sale of assets and providing a put right by holders upon a change of control, as well as other certain affirmative and negative covenants.

In February 2009, we issued $420 million of 9¾% Senior Subordinated Notes due 2016 (“2016 Notes”). The 2016 Notes, which carry a coupon rate of 9.75%, were sold at a discount (92.816% of par), which equates to an effective yield to maturity of approximately 11.25%.

In June 2009, we issued an additional $6.35 million of 2016 Notes to our founder, Gareth Roberts, as part of a Founder's Retirement Agreement. In connection with this issuance, we recorded compensation expense of $6.35 million in “General and administrative” expense in our Consolidated Statement of Operations during the year ended December 31, 2009.

The 2016 Notes mature on March 1, 2016, and interest on the 2016 Notes is payable March 1 and September 1 of each year. We may redeem the 2016 Notes in whole or in part at our option beginning March 1, 2013, at the following redemption prices: 104.875% after March 1, 2013, 102.4375% after March 1, 2014, and 100% after March 1, 2015. In addition, we may, at our option, redeem up to an aggregate of 35% of the 2016 Notes before March 1, 2012, at a price of 109.75%. The indenture governing the 2016 Notes contains certain restrictions on our ability to incur additional debt, pay dividends on our common stock, make investments, create liens on our assets, engage in transactions with our affiliates, transfer or sell assets, consolidate or merge, or sell substantially all of our assets. The 2016 Notes are not subject to any sinking fund requirements. All of our subsidiaries, other than minor subsidiaries, guarantee this debt jointly and severally.

In February 2010, we issued $1.0 billion of 8¼% Senior Subordinated Notes due 2020 (the “2020 Notes”), for net proceeds after underwriting discounts and commissions of $980 million. The 2020 Notes, which carry a coupon rate of 8.25%, were sold at par. We subsequently redeemed $3.7 million principal amount of the 2020 Notes, as required under the indenture governing the 2020 Notes. See Tender Offers and Consent Solicitations for Encore's Senior Subordinated Notes; Supplements to Indentures Governing Encore's Senior Subordinated Notes above.

The 2020 Notes mature on February 15, 2020, and interest is payable on February 15 and August 15 of each year. We may redeem the 2020 Notes in whole or in part at our option beginning February 15, 2015, at the following redemption prices: 104.125% after February 15, 2015, 102.75% after February 15, 2016, 101.375% after February 15, 2017, and 100% after February 15, 2018. Prior to February 15, 2013, we may, at our option, redeem up to an aggregate of 35% of the principal amount of the 2020 Notes at a price of 108.25% with the proceeds of certain equity offerings. In addition, at any time prior to February 15, 2015, we may redeem 100% of the principal amount of the 2020 Notes at a price equal to 100% of the principal amount plus a “make-whole” premium and accrued and unpaid interest. The indenture governing the 2020 Notes contains certain restrictions on our ability to incur additional debt, pay dividends on our common stock, make investments, create liens on our assets, engage in transactions with our affiliates, transfer or sell assets, consolidate or merge, or sell substantially all of our assets. The 2020 Notes are not subject to any sinking fund requirements. All of our subsidiaries, other than minor subsidiaries, guarantee this debt jointly and severally.

In February 2011, we issued $400 million of 6⅜% Senior Subordinated Notes due 2021 (“2021 Notes”). The 2021 Notes, which carry a coupon rate of 6.375%, were sold at par. The net proceeds of $393 million were used to repurchase a portion of our 2013 Notes and 2015 Notes (see 7½% Senior Subordinated Notes due 2013 and 7½% Senior Subordinated Notes due 2015 above). The 2021 Notes mature on August 15, 2021, and interest is payable on February 15 and August 15 of each year, beginning August 15, 2011. We may redeem the 2021 Notes in whole or in part at our option beginning August 15, 2016 at the following redemption prices: 103.188% on or after August 15, 2016; 102.125% on or after August 15, 2017; 101.062% on or after August 15, 2018; and 100% on or after August 15, 2019. Prior to August 15, 2014, we may at our option redeem up to an aggregate of 35% of the principal amount of the 2021 Notes at a price of 106.375% with the proceeds of certain equity offerings. In addition, at any time prior to August 15, 2016, we may redeem 100% of the principal amount of the 2021 Notes at a price equal to 100% of the principal amount plus a “make-whole” premium and accrued and unpaid interest. The indenture governing the 2021 Notes contains certain restrictions on our ability to incur additional debt, pay dividends on our common stock, make investments, create liens on our assets, engage in transactions with our affiliates, transfer or sell assets, consolidate or merge, or sell substantially all of our assets. The 2021 Notes are not subject to any sinking fund requirements. All of our subsidiaries, other than minor subsidiaries, guarantee this debt jointly and severally.

In May 2008, we closed two transactions with Genesis involving two of our pipelines. The NEJD pipeline system included a 20-year financing lease, and the Free State Pipeline included a long-term transportation service agreement. We recorded both of these transactions as financing leases.

In connection with the issuance of our outstanding long-term debt, the Company has incurred debt issuance costs, which are being amortized to interest expense using the effective interest method over the term of each related facility. Remaining unamortized debt issuance costs were $69.6 million and $74.8 million at December 31, 2011 and 2010, respectively. These balances are included in “Other assets” in our Consolidated Balance Sheets.

At December 31, 2011, our indebtedness, including our capital and financing lease obligations but excluding the discount and premium on our senior subordinated debt, is payable over the next five years and thereafter as follows: