Debt and Tax Gross-ups on Debt (Tables)

3 Months Ended

Jun. 30, 2013

Debt and Tax Gross-ups on Debt

Schedule of company's debt

Prospect’s debt consists of the following:

	June 30, 2013(thousands)			March 31, 2013(thousands)
	(unaudited)
Karlsson senior secured note	$	115,282		$	115,282
Apollo unsecured notes	6,750			6,750
Very Hungry unsecured notes	5,500			—
Tax gross-up on Karlsson senior secured note	17,629			6,226
Less: Unamortized debt discount*	(33,329		)	—
Total debt and tax gross-ups	111,832			128,258
Less: current portion of debt and tax gross-ups	(4,063		)	(128,258		)
Total long-term debt and tax gross-ups	$	107,769		$	—

* Includes gross discount on the Karlsson note of $34,528, net of amortized discount of $3,801; gross discount on the Very Hungry notes of $2,215, net of amortized discount of $1,014 and the gross discount of $2,900 related to the embedded derivative in the Very Hungry notes, net of amortized discount of $1,499.

Schedule of components of gain on debt restructuring

	Gain on extinguishment (in thousands)
	(unaudited)
Additional consideration-1% gross revenue interest	$	9,200
Additional consideration-tax gross-ups	11,403
Additional consideration-warrants	412
Fees paid to the Karlsson Group	400
Reduction in the fair value of the amended Karlsson Note*	(34,529		)
Net gain on debt extinguishment	$	(13,114	)

* See explanation of change in fair value under the Karlsson Note heading above.