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Long-Term Debt | 9 Months Ended
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Sep. 30, 2018
Debt Disclosure [Abstract] |
Long-Term Debt | Note 6: Long-Term Debt Our long-term debt consists of the following:
|  | September 30, |  |  | December 31, |
|  | 2018 |  |  | 2017 |
|  | (In Thousands) |
Working Capital Revolver Loan, with a current interest rate of 5.75% (A) |  | $ | — |  |  | $ | — |
Senior Secured Notes due 2023 (B) |  |  | 400,000 |  |  |  | — |
Senior Secured Notes due 2019 (B) |  |  | — |  |  |  | 375,000 |
Secured Promissory Note due 2019, with a current interest rate of 5.73% (C) |  |  | 7,416 |  |  |  | 8,167 |
Secured Promissory Note due 2021, with a current interest rate of 5.25% (D) |  |  | 8,899 |  |  |  | 11,262 |
Secured Promissory Note due 2023, with a current interest rate of 6.35% (E) |  |  | 15,180 |  |  |  | 16,665 |
Other |  |  | — |  |  |  | 2,994 |
Unamortized discount and debt issuance costs |  |  | (15,822 | ) |  |  | (4,689 | )
|  |  | 415,673 |  |  |  | 409,399 |
Less current portion of long-term debt, net |  |  | 12,698 |  |  |  | 9,146 |
Long-term debt due after one year, net |  | $ | 402,975 |  |  | $ | 400,253 |
(A) Our revolving credit facility (the “Working Capital Revolver Loan”) provides for advances up to $50 million (but provides an ability to expand the commitment an additional $25 million), based on specific percentages of eligible accounts receivable and inventories and up to $10 million of letters of credit, the outstanding amount of which reduces the available for borrowing under the Working Capital Revolver Loan. At September 30, 2018, our available borrowings under our Working Capital Revolver Loan were approximately $39.1 million, based on our eligible collateral, less outstanding letters of credit. The maturity date of the Working Capital Revolver Loan is January 17, 2022. The Working Capital Revolver Loan also provides for a springing financial covenant (the “Financial Covenant”), which requires that, if the borrowing availability is less than or equal to the greater of 10.0% of the total revolver commitments and $5 million, then the borrowers must maintain a minimum fixed charge coverage ratio of not less than 1.00 to 1.00. The Financial Covenant, if triggered, is tested monthl y. Note 6: Long-Term Debt (continued) (B) On April 25, 2018, LSB completed the issuance and sale of $400 million aggregate principal amount of its 9.625% Senior Secured Notes due 2023 (the “Senior Secured Notes”). The Senior Secured Notes were issued pursuant to an indenture, dated as of April 25, 2018 (the “Indenture”), by and among LSB, the subsidiary guarantors named therein, and Wilmington Trust, National Association, a national banking association, as trustee and collateral agent. The Senior Secured Notes were issued at a price equal to 99.509% of their face value. A portion of the net proceeds from the Senior Secured Notes were used to purchase/redeem the $375 million aggregate principal amount of the 8.5% Senior Secured Notes due 2019. The remaining net proceeds were primarily used to pay related transaction fees and expenses, redemption premiums, and accrued interest on the notes purchased/redeemed. A portion of the above transaction was accounted for as an extinguishment of debt and a portion was accounted for as a non-substantial debt modification. As a result, in the second quarter of 2018, approximately $15.2 million of the fees/redemption premiums/discount was deferred and included in discount and debt issuance costs and approximately $0.9 million of fees were expensed, as incurred, and are included in interest expense. In addition, in the second quarter of 2018, we recognized a loss on extinguishment of debt of approximately $6.0 million, primarily consisting of a portion of the redemption premiums paid and the expensing of a portion of debt issuance costs associated with the 8.5% Senior Secured Notes. The Senior Secured Notes will mature on May 1, 2023 and rank senior in right of payment to all of our debt that is expressly subordinated in right of payment to the notes and will rank pari passu in right of payment with all of our liabilities that are not so subordinated, including the Working Capital Revolver Loan. LSB’s obligations under the Senior Secured Notes are jointly and severally guaranteed by the subsidiary guarantors named in the Indenture on a senior secured basis. Interest on the Senior Secured Notes accrues at a rate of 9.625% per annum and is payable semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2018. LSB may redeem the Senior Secured Notes at its option, in whole or in part, subject to the payment of a premium ranging from a “make-whole” premium to a premium of 3.609% of the principal amount so redeemed, in the case of any optional redemption prior to May 1, 2022. If LSB experiences a change of control, it must offer to purchase the notes at 101% of their principal amount, plus accrued and unpaid interest, if any, up to but excluding the date of purchase. The Indenture contains covenants that limit, among other things, LSB and certain of its subsidiaries’ ability to (1) incur additional indebtedness; (2) declare or pay dividends, redeem stock or make other distributions to stockholders; (3) make other restricted payments, including investments; (4) create dividend and other payment restrictions affecting its subsidiaries; (5) create liens or use assets as security in other transactions; (6) merge or consolidate, or sell, transfer, lease or dispose of all or substantially all of our assets; and (7) enter into transactions with affiliates. Further, during any such time when the Senior Secured Notes are rated investment grade by each of Moody’s Investors Service, Inc. and Standard & Poor’s Investors Ratings Services and no Default (as defined in the Indenture) has occurred and is continuing, certain of the covenants will be suspended with respect to the Senior Secured Notes. The Indenture provides for customary events of default (subject in certain cases to customary grace and cure periods), which include nonpayment, breach of covenants in the Indenture, payment defaults or acceleration of other indebtedness, a failure to pay certain judgments and certain events of bankruptcy and insolvency. (C) El Dorado Chemical Company (“EDC”), one of our subsidiaries, is party to a secured promissory note due in June 2019. Principal and interest are payable in equal monthly installments with a final balloon payment of approximately $6.7 million. (D) EDC is party to a secured promissory note due in March 2021. Principal and interest are payable in monthly installments. (E) El Dorado Ammonia L.L.C. (“EDA”), one of our subsidiaries, is party to a secured promissory note due in May 2023. Principal and interest are payable in equal monthly installments with a final balloon payment of approximately $6.1 million.

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