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LONG-TERM DEBT | 12 Months Ended
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Dec. 31, 2022
LONG-TERM DEBT |
LONG-TERM DEBT | NOTE 14. LONG–TERM DEBT Long–term debt is comprised of the following: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31,
​ |  | 2022 | ​ | 2021
Credit facility | ​ | $ | 251,250 | ​ | $ | 234,500
​ | ​ | ​ | ​ | ​ | ​ | ​
6.25% senior notes due April 2028: | ​ | ​ | ​ | ​ | ​ | ​
Principal outstanding | ​ |  | 800,000 | ​ |  | 800,000
Unamortized debt premium | ​ | ​ | 10,530 | ​ |  | 12,536
Unamortized debt issuance costs | ​ |  | (8,744) | ​ |  | (10,406)
​ | ​ |  | 801,786 | ​ |  | 802,130
​ | ​ | ​ | ​ | ​ | ​ | ​
6.875% senior notes due April 2027: | ​ | ​ | ​ | ​ | ​ | ​
Principal outstanding | ​ | ​ | 500,000 | ​ |  | 500,000
Unamortized debt issuance costs | ​ | ​ | (4,702) | ​ |  | (5,805)
​ | ​ | ​ | 495,298 | ​ |  | 494,195
​ | ​ | ​ | ​ | ​ | ​ | ​
Long-term debt | ​ | $ | 1,548,334 | ​ | $ | 1,530,825
​ Credit Facility As of December 31, 2022, our Credit Facility has an aggregate borrowing commitment of $750.0 million and will expire in November 2024 unless renewed or amended prior to that date. Subject to certain conditions, including approval by the lenders, we are able to increase the aggregate commitments under the Credit Facility by up to an additional $250.0 million. We may use up to $50.0 million for swing line loans and an additional $50.0 million for letters of credit. As of December 31, 2022, there were $5.7 million letters of credit outstanding under the Credit Facility. The Credit Facility borrowing base consists of eligible accounts receivable, inventory and compressors, the largest of which is compressors. Borrowings under the Credit Facility are secured by substantially all of our personal property assets and certain of our subsidiaries. Borrowings under the Credit Facility bear interest at, based on our election, either a base rate or LIBOR, plus an applicable margin. The base rate is the highest of (i) the prime rate announced by JPMorgan Chase Bank, (ii) the Federal Funds Effective Rate plus 0.50% and (iii) one-month LIBOR plus 1.00%. Depending on our leverage ratio, the applicable margin varies (i) in the case of base rate loans, from 1.00% to 1.75% and (ii) in the case of LIBOR loans, from 2.00% to 2.75%. The weighted average annual interest rate on the outstanding balance under our Credit Facility, excluding the effect of interest rate swaps, was 6.9% and 2.6% at December 31, 2022 and 2021, respectively. Additionally, we are required to pay commitment fees based on the daily unused amount of the Credit Facility at a rate of 0.375%. We incurred $1.9 million, $2.0 million and $2.0 million in commitment fees during 2022, 2021 and 2020, respectively. As a result of the facility’s ratio requirements, $487.6 million of the $493.0 million of undrawn capacity was available for additional borrowings as of December 31, 2022. As of December 31, 2022, the following consolidated financial ratios, as defined in our Credit Facility agreement, were required: ​
​ | ​ | ​
EBITDA to Interest Expense |  | 2.5 to 1.0
Senior Secured Debt to EBITDA |  | 3.0 to 1.0
Total Debt to EBITDA |  |
January 1, 2023 through September 30, 2023 | ​ | 5.50 to 1.0
Thereafter (1) |  | 5.25 to 1.0
(1) | Subject to a temporary increase to 5.50 to 1.0 for any quarter during which an acquisition satisfying certain thresholds is completed and for the two quarters immediately following such quarter.
In addition to the financial covenants discussed above, the Credit Facility agreement contains various covenants including, but not limited to, restrictions on the use of proceeds from borrowings and limitations on our ability to incur additional indebtedness, engage in transactions with affiliates, merge or consolidate, sell assets, make certain investments and acquisitions, make loans, grant liens, repurchase equity and pay distributions. The Credit Facility agreement also contains various covenants requiring mandatory prepayments from the net cash proceeds of certain asset transfers. As of December 31, 2022, we were in compliance with all covenants under our Credit Facility agreement. 2027 Notes and 2028 Notes Our 2027 Notes were issued under an indenture dated March 21, 2019 and mature on April 1, 2027. The notes were issued in a private offering at 100% of their face value and have an effective interest rate of 7.9%. We received net proceeds of $491.2 million after deducting issuance costs of $8.8 million. Our 2028 Notes were issued under an indenture dated December 20, 2019 and mature on April 1, 2028. The 2028 Notes were issued in two private offerings of $500.0 million and $300.0 million in December 2019 and December 2020, respectively. The notes of the two offerings have identical terms and are treated as a single class of securities. The $300.0 million of notes were issued at 104.875% of their face value and have an effective interest rate of 5.6%. The $500.0 million of notes were issued at 100% of their face value and have an effective interest rate of 6.8%. We received net proceeds of $491.8 million after deducting issuance costs of $8.2 million from our December 2019 offering and net proceeds of $309.9 million after deducting issuance costs of $4.7 million from our December 2020 offering. The net proceeds from the 2027 Notes and 2028 Notes were used to repay borrowings outstanding under our Credit Facility. Issuance costs related to the 2027 Notes and 2028 Notes are considered deferred financing costs, and together with the issue premium of the December 2020 offering of 2028 Notes, are recorded within long-term debt in our consolidated balance sheets and are being amortized to interest expense in our consolidated statements of operations over the terms of the notes. The 2027 Notes and 2028 Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by us and all of our existing subsidiaries, other than Archrock Partners, L.P. and Archrock Partners Finance Corp., which are co–issuers of both offerings, and certain of our future subsidiaries. The 2027 Notes and 2028 Notes and the guarantees rank equally in right of payment with all of our and the guarantors’ existing and future senior indebtedness. The 2027 Notes and 2028 Notes may be redeemed at any time, in whole or in part, at specified redemption prices and make–whole premiums, plus any accrued and unpaid interest. Maturities of Long–Term Debt As of December 31, 2022, the maturities of our long–term debt, excluding interest to be accrued, are as follows: ​
​ | ​ | ​ | ​
​ |  | ​ | ​
2023 | ​ | $ | —
2024 | ​ |  | 251,250
2025 | ​ |  | —
2026 | ​ | ​ | —
2027 | ​ |  | 495,298
Thereafter | ​ |  | 801,786
​

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