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Long-Term Debt | 12 Months Ended
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Dec. 31, 2022
Debt Disclosure [Abstract] |
Long-term Debt | Note 7 — Long-Term Debt Long-term debt consists of the following (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | December 31,
​ | ​ | 2022 |  | 2021
2022 Notes (matured May 2022) | ​ | $ | — | ​ | $ | 35,000
2023 Notes (mature September 2023) | ​ | ​ | 30,000 | ​ | ​ | 30,000
2026 Notes (mature February 2026) | ​ |  | 200,000 | ​ |  | 200,000
MARAD Debt (matures February 2027) | ​ |  | 40,913 | ​ |  | 48,850
Unamortized debt issuance costs | ​ |  | (6,838) | ​ |  | (8,840)
Total debt | ​ |  | 264,075 | ​ |  | 305,010
Less current maturities | ​ |  | (38,200) | ​ |  | (42,873)
Long-term debt | ​ | $ | 225,875 | ​ | $ | 262,137
​ Credit Agreement On September 30, 2021 we entered into an asset-based credit agreement with Bank of America, N.A. (“Bank of America”), Wells Fargo Bank, N.A. and Zions Bancorporation and on July 1, 2022 we entered into a first amendment to the credit agreement (collectively, the “Amended ABL Facility”). The Amended ABL Facility provides for a $100 million asset-based revolving credit facility, which matures on September 30, 2026, with a springing maturity 91 days prior to the maturity of any outstanding indebtedness with a principal amount in excess of $50 million. The Amended ABL Facility also permits us to request an increase of the facility by up to $50 million, subject to certain conditions. Commitments under the Amended ABL Facility are comprised of separate U.S. and U.K. revolving credit facility commitments of $65 million and $35 million, respectively. The Amended ABL Facility provides funding based on a borrowing base calculation that includes eligible U.S. and U.K. customer accounts receivable and cash, and provides for a $10 million sub-limit for the issuance of letters of credit. As of December 31, 2022, we had no borrowings under the Amended ABL Facility, and our available borrowing capacity under that facility, based on the borrowing base, totaled $98.1 million, net of $1.9 million of letters of credit issued under that facility. We and certain of our U.S. and U.K. subsidiaries including Helix Alliance are the current borrowers under the Amended ABL Facility, whose obligations under the Amended ABL Facility are guaranteed by those borrowers and certain other U.S. and U.K. subsidiaries, excluding Cal Dive I – Title XI, Inc. (“CDI Title XI”), Helix Offshore Services Limited and certain other enumerated subsidiaries. Other subsidiaries may be added as guarantors of the facility in the future. The Amended ABL Facility is secured by all accounts receivable and designated deposit accounts of the U.S. borrowers and guarantors, and by substantially all of the assets of the U.K. borrowers and guarantors. U.S. borrowings under the Amended ABL Facility bear interest at the Term SOFR (also known as CME Term SOFR as administered by CME Group, Inc.) rate plus a margin of 1.50% to 2.00% or at a base rate plus a margin of 0.50% to 1.00%. U.K. borrowings under the Amended ABL Facility denominated in U.S. dollars bear interest at the Term SOFR rate with SOFR adjustment of 0.10% and U.K. borrowings denominated in the British pound bear interest at the SONIA daily rate, each plus a margin of 1.50% to 2.00%. We also pay a commitment fee of 0.375% to 0.50% per annum on the unused portion of the facility. The Amended ABL Facility includes certain limitations on our ability to incur additional indebtedness, grant liens on assets, pay dividends and make distributions on equity interests, dispose of assets, make investments, repay certain indebtedness, engage in mergers, and other matters, in each case subject to certain exceptions. The Amended ABL Facility contains customary default provisions which, if triggered, could result in acceleration of all amounts then outstanding. The Amended ABL Facility requires us to satisfy and maintain a fixed charge coverage ratio of not less than 1.0 to 1.0 if availability is less than the greater of 10% of the borrowing base or $10 million. The Amended ABL Facility also requires us to maintain a pro forma minimum excess availability of $20 million for the 91 days prior to the maturity of each of our outstanding convertible senior notes. The Amended ABL Facility also (i) limits the amount of permitted debt for the deferred purchase price of property not to exceed $50 million, (ii) establishes an excess availability requirement for the portion of any post-closing earn-out consideration related to our acquisition of Alliance that will be paid in cash (Note 3), and (iii) provides for potential pricing adjustments based on specific metrics and performance targets determined by us and Bank of America, as agent with respect to the Amended ABL Facility, related to environmental, social and governance (“ESG”) changes implemented by us in our business. 2022 Notes We fully redeemed the $35 million remaining principal amount of the 2022 Notes plus accrued interest by delivering cash upon maturity as of May 1, 2022. The effective interest rate for the 2022 Notes was 4.8%. For the years ended December 31, 2022 and 2021, total interest expense related to the 2022 Notes was $0.6 million and $1.7 million, respectively, primarily from coupon interest expense. As a result of our adoption of ASU No. 2020-06, there were no longer any debt discounts to amortize in 2022 and 2021 (Note 2). During 2020, we repurchased $90 million in aggregate principal amount of the 2022 Notes, and for the year ended December 31, 2020, total interest expense related to the 2022 Notes was $6.6 million, with coupon interest expense of $3.9 million and the amortization of debt discount and issuance costs of $2.7 million. 2023 Notes The 2023 Notes bear interest at a coupon interest rate of 4.125% per annum payable semi-annually in arrears on March 15 and September 15 of each year until maturity. The 2023 Notes mature on September 15, 2023 unless earlier converted, redeemed or repurchased by us. The 2023 Notes are convertible by their holders at any time beginning March 15, 2023 at an initial conversion rate of 105.6133 shares of our common stock per $1,000 principal amount, which currently represents 3,168,399 potentially convertible shares at an initial conversion price of approximately $9.47 per share of common stock. Upon conversion, we have the right to satisfy our conversion obligation by delivering cash, shares of our common stock or any combination thereof. Prior to March 15, 2023, holders of the 2023 Notes may convert their notes if the closing price of our common stock exceeds 130% of the conversion price for at least 20 days in the period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter (share price condition) or if the trading price of the 2023 Notes is equal to or less than 97% of the conversion value of the notes during the five consecutive business days immediately after any ten consecutive trading day period (trading price condition). Holders of the 2023 Notes may also convert their notes if we make certain distributions on shares of our common stock or engage in certain corporate transactions, in which case the holders may be entitled to an increase in the conversion rate, depending on the price of our common shares and the time remaining to maturity, of up to 47.5260 shares of our common stock per $1,000 principal amount. Prior to March 15, 2021, the 2023 Notes were not redeemable. On or after March 15, 2021, we may redeem all or any portion of the 2023 Notes if the price of our common stock has been at least 130% of the conversion price for at least 20 trading days during any 30 consecutive trading day period preceding our redemption notice. Any redemption would be payable in cash equal to 100% of the principal amount to be redeemed plus accrued and unpaid interest and a “make-whole premium” calculated as the present value of all remaining scheduled interest payments. Holders of the 2023 Notes may convert any of their notes if we call the notes for redemption. Holders of the 2023 Notes may also require us to repurchase the notes following a “fundamental change,” which includes a change of control or a termination of trading of our common stock (as defined in the indenture governing the 2023 Notes). The indenture governing the 2023 Notes contains customary terms and covenants, including that upon certain events of default, the entire principal amount of and any accrued interest on the notes may be declared immediately due and payable. In the case of certain events of bankruptcy, insolvency or reorganization relating to us or a significant subsidiary, the principal amount of the 2023 Notes together with any accrued interest will become immediately due and payable. The effective interest rate for the 2023 Notes is 4.8%. For each of the years ended December 31, 2022 and 2021, total interest expense related to the 2023 Notes was $1.4 million primarily from coupon interest expense. As a result of our adoption of ASU No. 2020-06, there were no longer any debt discounts to amortize in 2022 and 2021 (Note 2). During 2020, we repurchased $95 million in aggregate principal amount of the 2023 Notes, and for the year ended December 31, 2020, total interest expense related to the 2023 Notes was $6.6 million, with coupon interest expense of $3.7 million and the amortization of debt discount and issuance costs of $2.9 million. 2026 Notes The 2026 Notes bear interest at a coupon interest rate of 6.75% per annum payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2021 until maturity. The 2026 Notes mature on February 15, 2026 unless earlier converted, redeemed or repurchased by us. The 2026 Notes are convertible by their holders at any time beginning November 17, 2025 at an initial conversion rate of 143.3795 shares of our common stock per $1,000 principal amount, which currently represents 28,675,900 potentially convertible shares at an initial conversion price of approximately $6.97 per share of common stock. Upon conversion, we have the right to satisfy our conversion obligation by delivering cash, shares of our common stock or any combination thereof. In order to reduce the potential dilution of the 2026 Notes to shareholders’ equity, we entered into capped call transactions (the “2026 Capped Calls”) in August 2020 concurrent with the 2026 Notes offering (Note 9). The 2026 Capped Calls effectively increase the conversion price of the 2026 Notes to approximately $8.42 per share. However, the 2026 Capped Calls are separate transactions from the 2026 Notes and do not change the holders’ rights under the 2026 Notes, and holders of the 2026 Notes do not have any rights with respect to the 2026 Capped Calls. Prior to November 17, 2025, holders of the 2026 Notes may convert their notes if the closing price of our common stock exceeds 130% of the conversion price for at least 20 days in the period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter (share price condition) or if the trading price of the 2026 Notes is equal to or less than 97% of the conversion value of the notes during the five consecutive business days immediately after any ten consecutive trading day period (trading price condition). Holders of the 2026 Notes may also convert their notes if we make certain distributions on shares of our common stock or engage in certain corporate transactions, in which case the holders may be entitled to an increase in the conversion rate, depending on the price of our common shares and the time remaining to maturity, of up to 64.5207 shares of our common stock per $1,000 principal amount. Prior to August 15, 2023, the 2026 Notes are not redeemable. On or after August 15, 2023, we may redeem all or any portion of the 2026 Notes if the price of our common stock has been at least 130% of the conversion price for at least 20 trading days during any 30 consecutive trading day period preceding our redemption notice. Any redemption would be payable in cash equal to 100% of the principal amount plus accrued and unpaid interest and a “make-whole premium” calculated as the present value of all remaining scheduled interest payments. Holders of the 2026 Notes may convert any of their notes if we call the notes for redemption. Holders of the 2026 Notes may also require us to repurchase the notes following a “fundamental change,” which includes a change of control or a termination of trading of our common stock (as defined in the indenture governing the 2026 Notes). The indenture governing the 2026 Notes contains customary terms and covenants, including that upon certain events of default, the entire principal amount of and any accrued interest on the notes may be declared immediately due and payable. In the case of certain events of bankruptcy, insolvency or reorganization relating to us or a significant subsidiary, the principal amount of the 2026 Notes together with any accrued interest will become immediately due and payable. The effective interest rate for the 2026 Notes is 7.6%. For the years ended December 31, 2022 and 2021, total interest expense related to the 2026 Notes was $14.8 million and $14.7 million, respectively, with coupon interest expense of $13.5 million each, and the amortization of debt issuance costs of $1.3 million and $1.2 million, respectively. As a result of our adoption of ASU No. 2020-06, there were no longer any debt discounts to amortize in 2022 and 2021 (Note 2). For the year ended December 31, 2020, total interest expense related to the 2026 Notes was $7.5 million, with coupon interest expense of $5.1 million and the amortization of debt discount and issuance costs of $2.4 million. MARAD Debt In 2005, Helix’s subsidiary CDI – Title XI issued its U.S. Government Guaranteed Ship Financing Bonds, Q4000 Series, to refinance the construction financing originally granted in 2002 of the Q4000 vessel (the “MARAD Debt”). The MARAD Debt is guaranteed by the U.S. government pursuant to Title XI of the Merchant Marine Act of 1936, administered by the Maritime Administration (“MARAD”). The obligation of CDI Title XI to reimburse MARAD in the event CDI Title XI fails to repay the MARAD Debt is collateralized by the Q4000 and is guaranteed 50% by us. In addition, we have agreed to bareboat charter the Q4000 from CDI Title XI for so long as the MARAD Debt remains outstanding. The MARAD Debt is payable in equal semi-annual installments through February 2027 and bears interest at a rate of 4.93%. The agreements relating to the bonds and the terms and conditions of our obligations to MARAD in respect of the MARAD Debt are typical for U.S. government-guaranteed ship financing transactions, including customary restrictions on incurring additional liens on the Q4000 and trading restrictions with respect to the vessel as well as working capital requirements. Other In accordance with the Amended ABL Facility, the 2023 Notes, the 2026 Notes and the MARAD Debt, we are required to comply with certain covenants, including minimum liquidity and a springing fixed charge coverage ratio (applicable under certain conditions that are currently not applicable) with respect to the Amended ABL Facility and the maintenance of net worth, working capital and debt-to-equity requirements with respect to the MARAD Debt. As of December 31, 2022, we were in compliance with these covenants. We previously had a credit agreement (and the amendments made thereafter, collectively the “Credit Agreement”) with a group of lenders led by Bank of America. The Credit Agreement was comprised of a term loan (the “Term Loan”) and a revolving credit facility (the “Revolving Credit Facility”) with a maximum availability of $175 million and had a maturity date of December 31, 2021. Concurrent with our entering into the ABL Facility on September 30, 2021, the Credit Agreement was terminated, the $28 million remaining balance of the Term Loan was repaid in full and the letters of credit issued under the Revolving Credit Facility were transferred to the ABL Facility. We had no borrowings under the Revolving Credit Facility. We previously had a credit agreement with a syndicated bank lending group for a term loan (the “Nordea Q5000 Loan”) to finance the construction of the Q5000. The loan was secured by the Q5000 and its charter earnings. In January 2021, we repaid the remaining principal amount of $53.6 million. Scheduled maturities of our long-term debt outstanding as of December 31, 2022 are as follows (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | 2023 | ​ | 2026 | ​ | MARAD | ​ | ​ |
​ |  | Notes |  | Notes |  | Debt |  | Total
Less than one year | ​ | $ | 30,000 | ​ | $ | — | ​ | $ | 8,333 |  | $ | 38,333
One to two years | ​ |  | — | ​ |  | — | ​ |  | 8,749 |  | ​ | 8,749
Two to three years | ​ |  | — | ​ |  | — | ​ |  | 9,186 |  | ​ | 9,186
Three to four years | ​ |  | — | ​ |  | 200,000 | ​ |  | 9,644 |  | ​ | 209,644
Four to five years | ​ |  | — | ​ |  | — | ​ |  | 5,001 |  | ​ | 5,001
Gross debt | ​ |  | 30,000 | ​ |  | 200,000 | ​ |  | 40,913 |  | ​ | 270,913
Unamortized debt issuance costs (1) | ​ |  | (133) | ​ |  | (4,632) | ​ |  | (2,073) |  | ​ | (6,838)
Total debt | ​ |  | 29,867 | ​ |  | 195,368 | ​ |  | 38,840 |  | ​ | 264,075
Less current maturities | ​ |  | (29,867) | ​ |  | — | ​ |  | (8,333) |  | ​ | (38,200)
Long-term debt | ​ | $ | — | ​ | $ | 195,368 | ​ | $ | 30,507 |  | $ | 225,875
(1) | Debt issuance costs are amortized to interest expense over the term of the applicable debt agreement.
The following table details the components of our net interest expense (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended December 31,
​ | ​ | 2022 |  | 2021 |  | 2020
Interest expense | ​ | $ | 20,176 | ​ | $ | 23,489 | ​ | $ | 30,538
Capitalized interest | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (1,182)
Interest income | ​ | ​ | (1,226) | ​ | ​ | (288) | ​ | ​ | (825)
Net interest expense | ​ | $ | 18,950 | ​ | $ | 23,201 | ​ | $ | 28,531
​

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