6. DEBT AND LINES OF CREDIT

The Company and its subsidiaries are subject to the following debt arrangements:



	Total Debt Outstanding
	September 30, 2016			December 31, 2015
	(In thousands)
8.75% Notes	$	350,000		$	350,000
WCC Term Loan Facility	324,705			327,172
San Juan Loan	110,000			—
WMLP Term Loan Facility	304,757			299,248
Capital lease obligations	61,579			71,168
Revolving Credit Facility	—			1,970
Other	14,930			7,251
Total debt	1,165,971			1,056,809
Less debt discount and debt issuance costs	(40,222		)	(36,914		)
Less current installments	(90,736		)	(40,822		)
Total debt outstanding, less current installments	$	1,035,013		$	979,073

The following table presents aggregate contractual debt maturities of all debt:



	September 30, 2016
	(In thousands)
2016	$	29,880
2017	81,178
2018	321,636
2019	19,090
2020	340,332
Thereafter	373,855
Total debt	$	1,165,971

8.75% Notes

The 8.75% senior secured notes mature on January 1, 2022 (“8.75% Notes”) and pay interest semiannually on January 1 and July 1 of each year at a fixed 8.75% interest rate. The 8.75% Notes are a primary obligation of the Parent and are guaranteed by Westmoreland Energy LLC, Westmoreland Mining LLC and Westmoreland Resources, Inc. and their respective subsidiaries (other than Absaloka Coal, LLC, Westmoreland Risk Management, Inc. and certain other immaterial subsidiaries), referred to as the “Guarantors.” The 8.75% Notes are not guaranteed by Westmoreland Canada LLC or any of its subsidiaries, Westmoreland San Juan, LLC or any of its subsidiaries, or Westmoreland Resources GP, LLC or WMLP, referred to as the “Non-guarantors.” As of September 30, 2016, we were in compliance with all covenants for the 8.75% Notes.

WCC Term Loan Facility

The term loan matures on December 16, 2020 (“WCC Term Loan Facility”) and pays interest on a quarterly basis at a variable interest rate which is set at our election of (i) one-, two-, three- or six-month London Interbank Offered Rate (“LIBOR”) plus 6.50% or (ii) a base rate (determined with reference to the highest of the prime rate, the Federal Funds Rate plus 0.05%, or one-month LIBOR plus 1.00%) plus 5.50%. As of September 30, 2016, the interest rate was 7.50%. The WCC Term Loan Facility is a primary obligation of the Parent and is guaranteed by the Guarantors. As of September 30, 2016, we were in compliance with all covenants of the WCC Term Loan Facility.

San Juan Loan

We financed the San Juan Acquisition in part with the San Juan Loan, a senior secured $125.0 million term loan from NM Capital Utility Corporation, an affiliate of Public Service Company of New Mexico (one of the owners of SJGS). The San Juan Loan matures February 1, 2021 and pays interest and principal on a quarterly basis at an interest rate of (i) 7.25% (the “Margin Rate”) plus (ii) (A) the LIBOR for a three month period plus (B) a statutory reserve rate, which such Margin Rate increases incrementally during each year of the San Juan Loan term. As of September 30, 2016, the cash interest rate is 8.01%. It is a primary obligation of Westmoreland San Juan, LLC, is guaranteed by SJCC, and is secured by substantially all of SJCC’s assets. The San Juan Loan has no prepayment penalties. The agreements governing the San Juan Loan include representations and warranties and covenants regarding the ownership and operation of SJCC and the properties acquired in the San Juan Acquisition and standard special purpose bankruptcy remote entity covenants designed to preserve the separateness from Westmoreland of each of (i) WSJ, (ii) its direct parent company, Westmoreland San Juan Holdings, Inc., (iii) SJCC and (iv) SJTC (collectively, the “Westmoreland San Juan Entities”). Obligations under the San Juan Loan are recourse only to the Westmoreland San Juan Entities and their assets Westmoreland nor its subsidiaries (other than the Westmoreland San Juan Entities) is an obligor under the San Juan Loan in any respect. The agreement governing the San Juan Loan requires that all revenues of the Westmoreland San Juan Entities, aside from payments on certain leases, are deposited into a cash management collection account swept monthly for operating expenses, capital expenditures, and loan payment and prepayment. The assets and credit of SJCC are not available to satisfy the debts and other obligations of the Company other than those of the Westmoreland San Juan Entities.

WMLP Term Loan Facility

The term loan of WMLP matures in December 2018 (“WMLP Term Loan Facility”) and pays interest on a quarterly basis at a variable rate per annum equal to the LIBOR floor of (0.75%) plus 8.5% or the reference rate as defined in the financing agreement. As of September 30, 2016, the cash interest rate is 9.25%. The WMLP Term Loan Facility is a primary obligation of Oxford Mining Company, LLC, a wholly owned subsidiary of WMLP, is guaranteed by WMLP and its subsidiaries, and is secured by substantially all of WMLP’s and its subsidiaries’ assets. At September 30, 2016, we were in compliance with all covenants of the WMLP Term Loan Facility.

The WMLP Term Loan Facility also provides for Paid In Kind Interest (“PIK Interest”) at a variable rate per annum between 1.00% and 3.00% based on our consolidated total net leverage ratio as defined in the financing agreement. The rate of PIK Interest is recalculated on a quarterly basis with the PIK Interest added quarterly to the then-outstanding principal amount of the term loan under the financing agreement. PIK Interest under the financing agreement was $6.9 million for the nine months ended September 30, 2016. The outstanding term loan amount represents the principal balance of $291.0 million, plus PIK Interest of $13.7 million.

WMLP Revolving Credit Facility

The WMLP revolving line of credit (“WMLP Revolving Credit Facility”) permits WMLP to borrow up to the aggregate principal amount of $15.0 million and also allows letters of credit in an aggregate outstanding amount of up to $10.0 million, which reduces availability under the WMLP revolving credit facility on a dollar-for-dollar basis. At September 30, 2016, availability under the WMLP revolving credit facility was $15.0 million. The WMLP Revolving Credit Facility has a maturity date of December 31, 2017. We were in compliance with all covenant requirements of the WMLP Revolving Credit Facility as of September 30, 2016.

Capital Lease Obligations

During the nine months ended September 30, 2016, the Company entered into $10.0 million of new capital leases.

WCC Revolving Credit Facility

The Company amended the terms of its revolving line of credit (“WCC Revolving Credit Facility”) on September 30, 2016 and October 12, 2016, respectively. The September 30 amendment clarified the terms “Canadian Fixed Charges” and “US Fixed Charges” to allocate scheduled cash interest payments and to remove the allocation schedule of cash interest payments under the term “Interest Expense.” The October 12 amendment (1) replaced the previous lender, Bank of the West, with a new lender, East West Bank, (2) amended Interest Expense to remove certain dividend payments, (3) revised the term “Required Lenders” to constitute all lenders when only two unaffiliated lenders are party to the revolving credit facility, (4) removed the requirement of the delivery of a social responsibility questionnaire in connection with a Permitted Acquisition, (5) allowed for any Lender to provide the Swing Line Lender one day’s prior written notice prohibiting a US Swing Line Loan or Canadian Swing Line Loan, (6) removed Administrative Agent discretion on application of proceeds from the sale of Collateral, (7) adjusted Annual Projections reporting requirements to no longer require delivery of a balance sheet and (8) adjusted the waterfall treatment with respect to Proceeds of Collateral.

Under the WCC Revolving Credit Facility the Company has a total aggregate borrowing capacity of $60.0 million between June 15th and August 31st of each year, with an aggregate borrowing capacity of $50.0 million outside of these periods. The availability of the WCC Revolving Credit Facility consists of a $30.0 million sub-facility ($35.0 million with the seasonal increase) available to our U.S. borrowers and a $20.0 million sub-facility ($25.0 million with the seasonal increase) available to our Canadian borrowers. The facility may support an equal amount of letters of credit, with outstanding letter of credit balances reducing availability under the facility. At September 30, 2016, availability on the WCC Revolving Credit Facility was $36.3 million with an outstanding balance of $13.7 million supporting letters of credit and nothing drawn on the WCC Revolving Credit Facility. The WCC Revolving Credit Facility has a maturity date of December 31, 2018. We were in compliance with all covenant requirements of the WCC Revolving Credit Facility as of September 30, 2016.

Deferred Financing Costs

Due to the adoption of ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, debt issuance costs related to the Company’s debt liabilities are now reported in the balance sheet as a direct deduction from the face amount of the notes. The adoption of this standard resulted in the reclassification of $25.8 million of unamortized debt issuance costs from the non-current asset, Other assets, to a reduction of Long-term debt, less current portion on the consolidated balance sheet as of December 31, 2015.