INDEBTEDNESS

6 Months Ended

Jun. 30, 2020

INDEBTEDNESS

Long-term debt consisted of the following as of June 30, 2020 (in thousands):


	Principal Amount		Discount		Debt Issuance Costs		Net Balance
ABL facility	$	—	$	—	$	—	$	—
First lien term loan	920,375		(7,836)		(21,295)		891,244
Second lien notes	412,256		(11,269)		(7,596)		393,391
	$	1,332,631	$	(19,105)	$	(28,891)	1,284,635
Less: current portion							(9,250)
Total long-term debt							$	1,275,385

Long-term debt consisted of the following as of December 31, 2019 (in thousands):


	Principal Amount		Discount		Debt Issuance Costs		Net Balance
ABL facility	$	—	$	—	$	—	$	—
First lien term loan	925,000		(8,399)		(22,825)		893,776
Second lien notes	412,256		(11,672)		(7,864)		392,720
	$	1,337,256	$	(20,071)	$	(30,689)	1,286,496
Less: current portion							(9,250)
Total long-term debt							$	1,277,246

The interest rate on the first lien term loan was 4.68% and 6.20% as of June 30, 2020 and December 31, 2019, respectively. The weighted average interest rate incurred on the first lien term loan was 5.02% and 5.60% for the three and six months ended June 30, 2020. The weighted average interest rate incurred on the previous first lien term loan was 6.22% and 6.24% for the three and six months ended June 30, 2019. The interest rate on the second lien notes was 10.25% and 10.66% as of June 30, 2020 and December 31, 2019, respectively. The weighted average interest incurred on the second lien notes was 10.33% and 10.44% for the three and six months ended June 30, 2020. The weighted average interest incurred on the previous second lien term loan was 11.34% and 11.45% for the three and six months ended June 30, 2019.

The Company elected to pay-in-kind (“PIK”) the quarterly interest payment due in August 2020, which will result in the Company capitalizing $10.8 million in interest expense to the principal balance of the second lien term loan on the interest payment date. In connection with the PIK election, the Company was charged an additional 1.00% in interest expense during the quarterly interest period.

Subsequent to June 30, 2020, the Company completed a public offering of stock for net proceeds of approximately $118 million. Those proceeds and available cash will be used to prepay $125.0 million of the second lien notes. See Note 18, Subsequent Events, for further discussion.

Long-term debt matures as follows (in thousands):


Year Ending December 31,	Minimum Payments
2020	$	4,625
2021	9,250
2022	9,250
2023	9,250
2024	9,250
Thereafter	1,291,006
Total	1,332,631

During the three and six months ended June 30, 2020 and 2019, the Company engaged in hedging activities to limit its exposure to changes in interest rates. See Note 12, Derivative Instruments, for further discussion.

The following table presents the estimated fair values of the Company’s debt obligations as of June 30, 2020 (in thousands):


Financial Instrument	Carrying Value as of June 30, 2020		Markets for Identical Item (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
First lien term loan	$	891,244	$	—	$	892,764	$	—
Second lien notes	393,391		—		—		417,910
Total debt instruments	$	1,284,635	$	—	$	892,764	$	417,910

The following table sets forth the changes in Level 3 measurements for the three and six months ended June 30, 2020 (in thousands):


	Level 3 Measurements
Second lien notes fair value as of January 1, 2020	$	411,119
Change in fair value	(71,748)
Second lien notes fair value as of March 31, 2020	$	339,371
Change in fair value	78,539
Second lien notes fair value as of June 30, 2020	$417,910

See Note 13, Fair Value Measurements, for further discussion.