(8)INDEBTEDNESS

The following is a summary of all debt outstanding at September 30, 2017 and March 31, 2017:

	Successor			Predecessor
	September 30,			March 31,
(In thousands)	2017			2017
Term loan (A)	$	—			300,000
Revolving line of credit (A) (B)		—			600,000
September 2013 senior unsecured notes (A)		—			500,000
August 2011 senior unsecured notes (A)		—			165,000
September 2010 senior unsecured notes (A)		—			382,500
New secured notes (A)		350,000			—
New secured notes - premium		14,987			—
Troms Offshore borrowings:
May 2015 notes (C)		26,115			27,421
May 2015 notes - discount		(1,927	)		—
March 2015 notes (C)		23,345			24,573
March 2015 notes - discount		(1,755	)		—
January 2014 notes (C) (D)		26,687			26,167
January 2014 notes - discount		(1,707	)		—
May 2012 notes (C) (D)		14,980			14,864
May 2012 notes - premium		126			—
		450,851			2,040,525
Less: Deferred debt issue costs		—			6,401
Less: Current portion of long-term debt		5,174			2,034,124
Total long-term debt	$	445,677			—

(A)	As of September 30, 2017 the fair value (Level 2) of the New Secured Notes was $357.7 million. As of March 31, 2017 the aggregate fair value (Level 2) of the term loan, revolver and senior notes was $1.1 billion.

(B)	The revolver was fully drawn at March 31, 2017.

(C)	Notes require semi-annual principal and interest payments. As of September 30, 2017 and March 31, 2017, the aggregate fair value (Level 2) of the Troms Offshore borrowings was $90.9 million and $92.9 million, respectively.

(D)	Notes are denominated in Norwegian kroner (NOK)

New Secured Notes

On July 31, 2017, pursuant to the terms of the Plan, the company entered into an indenture (the “Indenture”) by and among the company, the wholly-owned subsidiaries named as guarantors therein (the “Guarantors”), and Wilmington Trust, National Association, as trustee and collateral agent (the “Trustee”), and issued $350 million aggregate principal amount of the company’s new 8.00% Senior Secured Notes due 2022 (the “New Secured Notes”).

The New Secured Notes will mature on August 1, 2022. Interest on the New Secured Notes will accrue at a rate of 8.00% per annum payable quarterly in arrears on February 1, May 1, August 1, and November 1 of each year in cash, beginning November 1, 2017. The New Secured Notes are secured by substantially all of the assets of the company and its Guarantors.

The New Secured Notes have minimum interest coverage requirement (EBITDA/Interest), for which compliance will first be measured for the twelve months ending June 30, 2019. Minimum liquidity requirements and other covenants are set forth in the Indenture. The Indenture also contains certain customary events of default.

Until terminated under the circumstances described in this paragraph, the New Secured Notes and the guarantees by the Guarantors will be secured by the Collateral (as defined in the Indenture) pursuant to the terms of the Indenture and the related security documents. The Trustee’s liens upon the Collateral and the right of the holders of the New Secured Notes to the benefits and proceeds of the Trustee’s liens on the Collateral will terminate and be discharged in certain circumstances described in the Indenture, including: (i) upon satisfaction and discharge of the Indenture in accordance with the terms thereof; or (ii) as to any Collateral of the company or the Guarantors that is sold, transferred or otherwise disposed of by the company or the Guarantors in a transaction or other circumstance that complies with the terms of the Indenture, at the time of such sale, transfer or other disposition.

The company is obligated to offer to holders of the New Secured Notes under the Indenture to repurchase the New Secured Notes at par in amounts of up to 100% of asset sale proceeds depending upon the types of assets sold as defined in the Indenture.

Modifications to Troms Offshore Borrowings

Concurrent with the July 31, 2017 Effective Date of the Plan, the Troms Offshore credit agreement was amended and restated to (i) reduce by 50% the required principal payments due from the Effective Date through March 31, 2019, (ii) modestly increase the interest rates on amounts outstanding through April 2023, and (iii) provide for security and additional guarantees, including (a) mortgages on six vessels and related assignments of earnings and insurances, (b) share pledges by Troms Offshore and certain subsidiaries of Troms Offshore, and (c) guarantees by certain subsidiaries of Troms Offshore.

The Troms Offshore borrowings continue to require semi-annual principal payments and bear interest at fixed rates based, in part, on Tidewater Inc.’s consolidated funded indebtedness to total capitalization ratio. As of September 30, 2017, the weighted average interest rate of the four tranches of Troms Offshore borrowings was 5.01%.

Debt Costs

The company capitalizes a portion of its interest costs incurred on borrowed funds used to construct vessels. The following is a summary of interest and debt costs incurred, net of interest capitalized:

Successor

Predecessor

Period from

August 1, 2017

July 1, 2017

Three Months

through

Ended

(In thousands)

September 30, 2017

July 31, 2017

September 30, 2016

Interest and debt costs incurred, net of interest capitalized

5,240

574

18,477

Interest costs capitalized

—

1,101

Total interest and debt costs

5,240

574

19,578

Successor

Predecessor

Period from

August 1, 2017

April 1, 2017

Six Months

through

Ended

(In thousands)

September 30, 2017

July 31, 2017

September 30, 2016

Interest and debt costs incurred, net of interest capitalized

5,240

11,179

35,431

Interest costs capitalized

—

2,494

Total interest and debt costs

5,240

11,179

37,925

The company recognized interest expense incurred subsequent to its Chapter 11 filing date only to the extent that such interest was paid during the proceedings or that it was an allowed claim. Accrued interest on the term loan, revolving line of credit and senior notes subsequent to the Petition Date was not an allowed claim in the Plan; therefore, the company did not record interest expense subsequent to that date. Had the term loan, revolving line of credit and senior notes not been compromised by the Plan, interest expense from April 1, 2017 through the Effective Date of July 31, 2017 would have been approximately $27 million.