Long-Term Debt

12 Months Ended

Dec. 31, 2019

Long-term debt consists of the following (in thousands):


	December 31,
	2019		2018
Credit facility	$	57,500	$	—

Total debt	57,500		—
Less: current maturities of long-term debt	—		—
Long-term debt	$	57,500	$	—

Credit Facility. On June 21, 2019, the Company amended and restated its existing $600.0 million reserve-based revolving credit facility. The initial borrowing base of the restated credit facility was $300.0 million, which was reduced to $225.0 million during the semi-annual redetermination concluded in November 2019. The next borrowing base redetermination is scheduled for April 2020. The restatement extended the credit facility maturity date to April 1, 2021 from March 31, 2020. The Company has $57.5 million outstanding under the credit facility at December 31, 2019, and $2.9 million in outstanding letters of credit, which reduce availability under the restated credit facility on a dollar-for-dollar basis.

The interest rate on outstanding borrowings under the restated credit facility was determined by a pricing grid tied to borrowing base utilization of (a) LIBOR plus an applicable margin that varies from 2.00% to 3.00% per annum, or (b) the base rate plus an applicable margin that varies from 1.00% to 2.00% per annum. Interest on base rate borrowings is payable quarterly in arrears and interest on LIBOR borrowings is payable every one, two, three or six months, at the election of the Company. Quarterly, the Company pays commitment fees assessed at annual rates of 0.50% on any available portion of the credit facility. During the year ended December 31, 2019, the weighted average interest rate paid for borrowings outstanding under both the previously outstanding credit facility and the amended and restated credit facility was approximately 4.7%.

The Company has the right to prepay loans under the credit facility at any time without a prepayment penalty, other than customary “breakage” costs with respect to LIBOR loans.

The restated credit facility is secured by (i) first-priority mortgages on at least 85% of the PV-9 valuation of all proved reserves included in the most recently delivered reserve report of the Company, (ii) a first-priority perfected pledge of substantially all of the capital stock owned by each credit party and equity interests in the Royalty Trusts that are owned by a credit party and (iii) a first-priority perfected security interest in substantially all the cash, cash equivalents, deposits, securities and other similar accounts, and other tangible and intangible assets of the credit parties (including but not limited to as-extracted collateral, accounts receivable, inventory, equipment, general intangibles, investment property, intellectual property, real property and the proceeds of the foregoing).

The restated facility includes events of default and certain customary affirmative and negative covenants. The Company is required to maintain certain financial covenants including (i) a maximum consolidated total net leverage ratio, measured as of the end of any fiscal quarter, of no greater than 3.50 to 1.00 and (ii) a minimum consolidated interest coverage ratio, measured as of the end of any fiscal quarter, of no less than 2.25 to 1.00. As of December 31, 2019, the Company was in compliance with all applicable covenants and had a consolidated total net leverage ratio of 0.38 and consolidated interest coverage ratio of 37.89.

The credit facility previously outstanding from February 10, 2017 through June 21, 2019 had an initial borrowing base of $425.0 million, which was reduced to $350.0 million during a borrowing base redetermination in October 2018. The previously outstanding credit facility had materially similar terms and covenants to the current amended and restated credit facility, but was secured by first-priority mortgages on at least 95% of the PV-9 valuation of the Company's proved reserves and interest was calculated based on a pricing grid tied to the borrowing base utilization rate of (a) LIBOR plus an applicable margin that varied from 3.00% to 4.00% per annum, or (b) the base rate plus an applicable margin that varied from 2.00% to 3.00% per annum. The Company incurred an immaterial amount of interest expense on the previously outstanding credit facility during the years ended December 31, 2018 and 2017.

Building Note. In February 2018, the Company fully repaid the Building Note in the amount of $36.3 million, which was comprised of an initial principal amount of $35.0 million and $1.3 million in in-kind interest costs that were previously added to the principal. An unamortized premium of $1.2 million was recognized as a gain on extinguishment of debt in the condensed consolidated statement of operations for the year ended December 31, 2018 in connection with the repayment.