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Long-Term Debt | 3 Months Ended
--- | ---
Mar. 31, 2025
Debt Disclosure [Abstract] |
Long-Term Debt | Long-Term Debt The following table summarizes the Company's outstanding debt:
| March 31, 2025 |  | December 31, 2024
| (In thousands)
Credit Facility | $ | 99,000 |  |  | $ | 115,000 |
Senior Notes |  |  |
Principal | $ | 160,000 |  |  | $ | 165,000 |
Less: Unamortized discount(1) | 6,933 |  |  | 7,547 |
Less: Unamortized deferred financing costs(1) | 2,725 |  |  | 2,959 |
Total Senior Notes | $ | 150,342 |  |  | $ | 154,494 |
Total debt | $ | 249,342 |  |  | $ | 269,494 |
Less: Current portion of long-term debt(2) | 20,000 |  |  | 20,000 |
Total long-term debt | $ | 229,342 |  |  | $ | 249,494 |
___________________ (1)Unamortized discount and unamortized deferred financing costs are attributable to and amortized over the term of the Senior Notes. (2)As of March 31, 2025, and December 31, 2024, the current portion of long-term debt reflects $20 million due on the Senior Notes over the next twelve months. Credit Facility As of March 31, 2025, Riley Exploration - Permian, LLC ("REP LLC"), as borrower, and the Company, as parent guarantor, are parties to a credit agreement with Truist Bank and certain lenders party thereto, as amended, which provides for a Credit Facility with a borrowing base of $400 million. On December 13, 2024, the Company entered into the sixteenth amendment to the Credit Facility to, among other things, extend the stated maturity date from April 2026 to December 2028 (or if any Senior Notes are then outstanding, the date that is 181 days prior to the earliest stated maturity date of such Senior Notes, in this case October 2027) and increase the borrowing base from $375 million to $400 million, resulting in the addition of one new lender to the lending group. Substantially all of the Company’s assets are pledged to secure the Credit Facility. The Credit Facility contains certain covenants, which, among other things, require the maintenance of (i) a total leverage ratio of not greater than 3.00 to 1.00 and (ii) a minimum current ratio of not less than 1.0 to 1.0 as of the last day of any quarter. The Credit Facility also contains a total leverage ratio for the regulation of Restricted Payments, as defined in the credit agreement after giving pro forma effect to such Restricted Payments, which includes payments to any holder of the Company's shares, would not exceed 2.50 to 1.00. If the Company's leverage ratio, after giving pro forma effect to such Restricted Payments (as defined in the Credit Agreement), is above 2.0 to 1.0, then an additional test of free cash flow is applied, and the Company will only be permitted to make such Restricted Payments if such payment does not exceed the Company's free cash flow. In addition to and after giving effect to such Restricted Payments, the availability of funds under the Company's Credit Facility must be greater than or equal to 20% of the elected commitments. The Company must maintain a minimum hedging requirement included within the credit agreement for oil and natural gas based on our proved developed producing projected volumes for oil and natural gas on a rolling 24-month basis. The following table summarizes the Credit Facility balances:
| March 31, 2025 |  | December 31, 2024
| (In thousands)
Outstanding borrowings | $ | 99,000 |  |  | $ | 115,000 |
Available under the borrowing base | $ | 301,000 |  |  | $ | 285,000 |
Senior Notes On April 3, 2023, the Company (as issuer) completed our issuance of $200 million aggregate principal amount of 10.50% senior unsecured notes with final maturity in April 2028 pursuant to a note purchase agreement (the "Note Purchase Agreement"), with the Senior Notes issued at a 6% discount. Interest is due and payable at the end of each quarter. In addition to interest, the Company will repay 2.50% of the original principal amount each quarter resulting in $5 million quarterly principal payments until the maturity of the Senior Notes. As of March 31, 2025, the Company had $20 million in current liabilities in our accompanying condensed consolidated balance sheets related to the quarterly principal payments due within the next 12 months. The Company may, at our option, redeem, at any time and from time to time on or prior to April 3, 2026, some or all of the Senior Notes at 100% of the principal amount thereof plus the make-whole amount plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After April 3, 2026, but on or prior to October 3, 2026, the Company may, at our option, redeem, at any time and from time to time some or all of the Senior Notes at 100% of the principal amount thereof plus a premium of 5.25% as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any. After October 3, 2026, the Company may redeem some or all of the Senior Notes at 100% of the principal amount thereof plus accrued and unpaid interest, if any. The principal remaining outstanding at the time of maturity is required to be paid in full by the Company. Certain note features, including those discussed above, were evaluated and deemed to be remote. Due to the remote nature, the fair value of these features was estimated to be approximately zero. The Senior Notes contain certain covenants, which, among other things, require the maintenance of (i) a total leverage ratio of not greater than 3.00 to 1.00 and (ii) an asset coverage ratio greater than 1.50 to 1.00. The Senior Notes also contain a total leverage ratio and an asset coverage ratio for Restricted Payments, as defined in the Note Purchase Agreement. The leverage ratio, after giving pro forma effect to such Restricted Payments, cannot exceed 2.00 to 1.00, and the asset coverage ratio, after giving effect to such Restricted Payments, must be greater than or equal to 1.50 to 1.00. In addition to and after giving effect to such Restricted Payments, the availability of funds under the Company's Credit Facility must be greater than or equal to 15% of the Aggregate Elected Commitment Amount, as defined in the Note Purchase Agreement. Upon issuance of the Senior Notes, the Company must maintain a minimum hedging requirement included within the Senior Notes for oil and natural gas based on our proved developed producing projected volumes for oil and natural gas on a rolling 18-month basis. The Senior Notes are general unsecured obligations ranking equally in right of payment with all other senior unsecured indebtedness of the Company and are senior in right of payment to all existing and future subordinated indebtedness of the Company. The Note Purchase Agreement contains customary terms and covenants, including limitations on the Company’s ability to incur additional secured and unsecured indebtedness. The following table summarizes the Company's interest expense:
| Three Months Ended March 31, |  |
| 2025 |  | 2024 |  |  |  |
| (In thousands)
Interest expense | $ | 6,025 |  |  | $ | 8,743 |  |  |  |  |
Interest income | (130) |  |  | (207) |  |  |  |  |
Capitalized interest | (691) |  |  | (964) |  |  |  |  |
Amortization of deferred financing costs | 568 |  |  | 671 |  |  |  |  |
Amortization of discount on Senior Notes | 614 |  |  | 644 |  |  |  |  |
Unused commitment fees on Credit Facility | 275 |  |  | 180 |  |  |  |  |
Total interest expense, net | $ | 6,661 |  |  | $ | 9,067 |  |  |  |  |
As of March 31, 2025, and December 31, 2024, the weighted average interest rate on outstanding borrowings under the Credit Facility was 7.25% and 7.79%, respectively. As of March 31, 2025, the Senior Notes had $6.9 million of unamortized discount and $2.7 million of unamortized deferred financing costs, resulting in an effective interest rate of 13.38% during the three months ended March 31, 2025. As of December 31, 2024, the Senior Notes had $7.5 million of unamortized discount and $3.0 million of unamortized deferred financing costs, resulting in an effective interest rate of 13.38% during the year ended December 31, 2024. As of March 31, 2025, the Company was in compliance with all covenants contained in the Credit Agreement and Note Purchase Agreement.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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