Debt

As of the dates indicated, long-term debt and financing leases consisted of the following:



	December 31, 2019			December 31, 2018
Credit facility	$	130,000		$	—
Senior Notes	300,000			300,000
Real estate mortgage notes, principal and interest payable monthly, bearing interest at 5.50%, due December 2028; collateralized by real property	—			8,588
Installment notes payable, principal and interest payable monthly collateralized by personal property	371			354
Financing lease obligations	1,653			11,677
Unamortized issuance costs	(10,038		)	(13,148		)
Total debt, net	421,986			307,471
Less current portion	594			12,371
Total long-term debt, net	$	421,392		$	295,100

Maturities of long-term debt and capital leases, excluding unamortized debt issuance costs, are as follows as of December 31, 2019:



2020	$	594
2021	540
2022	130,577
2023	300,260
2024	53
2025 and thereafter	—
	$	432,024

As discussed in “Note 7: Property and equipment,” upon the divestiture of our headquarters building in August 2019, we utilized the sale proceeds to pay off the outstanding balance of our real estate mortgage note which was $8,176 at the time of the repayment.

Our financing lease obligations as of December 31, 2018, included leases on CO₂ compressors that were subleased to the buyer of our former EOR oil and natural gas properties. In August 2019, U.S. Bank entered into agreements with the Sublessee that resulted in the discharge of all our obligations with respect to these compressor leases and the removal of the associated debt from our consolidated balance sheet in the amount of $9,832. Our remaining finance leases consist primarily of leases on our fleet vehicles.

Credit Agreement

Pursuant to our Credit Agreement (the “Credit Agreement”) with Royal Bank of Canada, as administrative agent and issuing bank, and the additional lenders party thereto, we have a $750,000 facility collateralized by our oil and natural gas properties and is scheduled to mature on December 21, 2022. Availability under our Credit Agreement is subject to the financial covenants discussed below and a borrowing base based on the value of our oil and natural gas properties and set by the banks semi-annually on May 1 and November 1 of each year. In addition, the lenders may request a borrowing base redetermination once between each scheduled redetermination or upon the occurrence of certain specified events. The banks establish a borrowing base by making an estimate of the collateral value of our oil and natural gas properties. If oil and natural gas prices decrease from the amounts used in estimating the collateral value of our oil and natural gas properties, the borrowing base may be reduced, thus reducing funds available under the borrowing base. Our borrowing base under the Credit Agreement as of December 31, 2019, was $325,000 while the unused portion on that date was $195,000.

Interest on the outstanding amounts under the credit facility will accrue at an interest rate equal to either (i) the Alternate Base Rate (as defined in the Credit Agreement) plus an Applicable Margin (as defined in the Credit Agreement) that ranges between 1.00% to 2.00% depending on utilization or (ii) the Adjusted LIBO Rate (as defined in the Credit Agreement) applicable to one, two, three, or six month borrowings plus an Applicable Margin that ranges between 2.00% to 3.00% depending on utilization. In the case that an Event of Default (as defined under the Credit Agreement) occurs, the outstanding amounts will bear an additional 2.00% interest plus the applicable Alternate Base Rate or Adjusted LIBO Rate and corresponding Applicable Margin.

As of December 31, 2019, our outstanding borrowings were accruing interest at the Adjusted LIBO Rate (as defined in the Credit Agreement, as defined below), plus the Applicable Margin (as defined in the Credit Agreement), which resulted in a weighted average interest rate of 4.03% on the amount outstanding.

Commitment fees that range between 0.375% and 0.500%, depending on utilization, accrue on the average daily amount of the unused portion of the borrowing base and are included as a component of interest expense. We generally have the right to make prepayments of the borrowings at any time without penalty or premium. Letter of credit fees will accrue at 0.125% plus the Applicable Margin used to determine the interest rate applicable to borrowings that are based on Adjusted LIBO Rate.

If the outstanding borrowings under our Credit Agreement were to exceed the borrowing base as a result of a redetermination, we would be required to eliminate this deficiency. Within 10 days after receiving notice of the new borrowing base, we would be required to make an election: (1) to repay the deficiency in a lump sum within 45 days, (2) commencing within 30 days to repay the deficiency in equal monthly installments over a six months period, (3) to submit within 45 days additional oil and gas properties we own for consideration in connection with the determination of the borrowing base sufficient to eliminate the deficiency or (4) any combination of repayment as provided in the preceding three elections.

On May 2, 2019, we entered into the Third Amendment (the “Third Amendment”) to the Credit Agreement. The Third Amendment, which was effective March 31, 2019, among other things, (i) reaffirmed the borrowing base at $325,000 and (ii) amended the definition of EBITDAX to add back certain severance and retirement payments, consulting fees, and related charges paid or incurred in connection with any retirement, severance or departure of officers or former officers in an aggregate amount not to exceed $4,000.

On September 27, 2019, we entered into the Fourth Amendment (the “Fourth Amendment”) to the Credit Agreement. The Fourth Amendment, among other things, (i) reaffirmed the borrowing base at $325,000; (ii) amended the definition of EBITDAX to, among other things, (a) added back losses related to or resulting from the full or partial extinguishment of debt, (b) expanded the add-back of amounts associated with retirements, severance or departure to apply to all employees or former employees, and (c) clarified that gains related to or resulting from the full or partial extinguishment of debt are excluded; and (iii) revised certain negative covenants to provide that the Company, under certain circumstances, may prepay or otherwise redeem certain Permitted Senior Additional Debt (as defined in the Credit Agreement) in an aggregate amount not to exceed $30,000.

Other Provisions

Interest payment dates are dependent on the type of borrowing. In the case of Alternate Base Rate loans, interest is payable quarterly in arrears. In the case of Adjusted LIBO Rate borrowings, interest is payable on the last day of each relevant interest period and, in the case of any interest period longer than three months, on each successive date three months after the first day of such interest period.

The Credit Agreement contains covenants and events of default customary for oil and natural gas reserve-based lending facilities including restrictions on additional debt, guarantees, liens, restricted payments, investments and hedging activity. Additionally, our Credit Agreement specifies events of default, including non-payment, breach of warranty, non-performance of covenants, default on other indebtedness or swap agreements, restrictions on paying dividends, certain adverse judgments, bankruptcy events and change of control, among others.

The financial covenants require, for each fiscal quarter, that we maintain: (1) a Current Ratio (as defined in the Credit Agreement) of no less than 1.00 to 1.00, and (2) a Ratio of Total Debt to EBITDAX (as defined in the Credit Agreement) of no greater than 4.0 to 1.0 calculated on a trailing four-quarter basis. We were in compliance with these financial covenants as of December 31, 2019.

The Credit Agreement is guaranteed by all of our wholly owned subsidiaries, subject to customary exceptions, and is secured by first priority security interests on substantially all of our assets.

Senior Notes

On June 29, 2018, we completed the issuance and sale at par of $300,000 in aggregate principal amount of our Senior Notes in a private placement under Rule 144A and Regulation S of the Securities Act of 1933, as amended. The offering costs were $7,337 resulting in net proceeds of $292,663, which we used to repay the outstanding balance on our credit facility at that time and for general corporate purposes.

The Senior Notes bear interest at a rate of 8.75% per year beginning June 29, 2018 (payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2019) and will mature on July 15, 2023.

The Senior Notes are the Company’s senior unsecured obligations and rank equal in right of payment with all of the Company’s existing and future senior indebtedness, senior to all of the Company’s existing and future subordinated indebtedness and effectively subordinated to all of the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing such indebtedness.

The Indenture for our Senior Notes contains certain covenants, which limit our ability to:

•incur additional indebtedness or issue certain preferred stock;

•pay dividends or repurchase or redeem capital stock;

•make certain investments;

•incur certain liens;

•enter into certain types of transactions with affiliates;

•sell assets;

•enter into agreements restricting our ability to pay dividends or make other payments;

•consolidate, merge, sell, or otherwise dispose of all or substantially all of our assets; and

•create unrestricted subsidiaries.

These limitations are subject to a number of important qualifications and exceptions.

Prior to July 15, 2020, the Company may, at its option, redeem all or, from time to time, a part of the Senior Notes at a redemption price equal to 100% of the principal amount thereof, plus an applicable make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On or after July 15, 2020, the Company may, at its option, redeem all or, from time to time, a part of the Senior Notes at a redemption price equal to 100% of the principal amount thereof, plus a premium declining ratably to par and accrued and unpaid interest, if any, to the date of redemption.

Prior to July 15, 2020, the Company, at its option, may redeem up to 35% of the aggregate principal amount of the Senior Notes with proceeds of one or more qualified equity offerings at a redemption price of 108.75% of the principal amount of the Senior Notes redeemed, plus accrued and unpaid interest, if any, and liquidated damages provided that:


1.	at least 60% of the aggregate principal amount of the Senior Notes issued under the Indenture remains outstanding after each such redemption; and


2.	such redemption occurs within 180 days after the closing of any such qualified equity offering

Upon an Event of Default (as defined in the Indenture), the trustee under the Indenture or the holders of at least 25% in aggregate principal amount of the outstanding Senior Notes may declare the entire principal of, premium, if any, and accrued and unpaid interest, if any, on all the Senior Notes to be due and payable immediately.

If the Company experiences certain kinds of changes of control, holders of the Senior Notes will be entitled to require the Company to purchase all or a portion of the Senior Notes at 101% of their principal amount, plus accrued and unpaid interest.

Chaparral Energy, Inc. is a holding company and owns no operating assets and has no significant operations independent of its subsidiaries. Our obligations under our outstanding Senior Notes have been fully and unconditionally guaranteed, on a joint and several basis, by all of our wholly owned subsidiaries.

Interest expense during bankruptcy. Pursuant to accounting guidance, while in bankruptcy, we did not accrue interest expense on our Prior Senior Notes during the pendency of the Chapter 11 Cases as we did not expect to pay such interest. As a result, reported interest expense was $22,582 lower than contractual interest for the Predecessor periods of January 1, 2017 to March 21, 2017.