The Company’s consolidated debt obligations consisted of the following at the dates indicated:

(1)

The carrying amount of the Company’s Revolving Credit Facility approximates fair value because the interest rates are variable and reflective of market rates.

Revolving Credit Facility

On November 2, 2018, OLLC and Amplify Acquisitionco, Inc. (“Acquistionco”) entered into a credit agreement (the “Credit Agreement”), providing for a reserve-based revolving credit facility (the “Revolving Credit Facility”), subject to a borrowing base of $210.0 million as of December 31, 2022, which is guaranteed by us and all of the Company’s current subsidiaries. The Credit Agreement matures on November 2, 2023. The borrowing base under the Company’s Credit Agreement is subject to redetermination on at least a semi-annual basis based on an engineering report with respect to its estimated oil, NGL and natural gas reserves, which will take into account the prevailing oil, NGL and natural gas prices at such time, as adjusted for the impact of commodity derivative contracts. Unanimous approval by the lenders is required for any increase to the borrowing base.

The terms and conditions under the original Credit Agreement include (but are not limited to) the following:

●

at OLLC’s option, borrowings under the Credit Agreement will bear interest at the base rate, LIBOR Market Index rate or LIBOR plus an applicable margin. Base rate loans bear interest at a rate per annum equal to the greatest of: (i) the federal funds effective rate plus 50 basis points, (ii) the rate of interest in effect for each day as publicly announced from time to time by the agent as its “prime rate”; and (iii) the adjusted LIBOR rate for a one-month interest period plus 100 basis points per annum. The applicable margin for base rate loans ranges from 100 to 200 basis points, and the applicable margin for LIBOR loans and LIBOR Market loans ranges from 200 to 300 basis points, in each case depending on the percentage of the borrowing base utilized;

●

the obligations under the Revolving Credit Facility are secured by mortgages on not less than 85% of the PV-9 value of oil and gas properties (and at least 85% of the PV-9 value of the proved, developed and producing oil and gas properties) included in the determination of the borrowing base. OLLC and its other subsidiaries entered into a pledge and security agreement in favor of the agent for the secured parties, pursuant to which OLLC’s obligations under the Credit Agreement are secured by a first priority security interest in substantially all of our assets (subject to permitted liens). Additionally, the Company entered into a non-recourse pledge agreement in favor of the agent for the secured parties, pursuant to which OLLC’s obligations under the Credit Agreement are secured by a pledge and security interest of 100% of the equity interests held by the Company in Acquisitionco;

●

0.5% fee on unused line of credit;

●

certain financial covenants, including the maintenance of (i) as of the date of determination, a maximum total debt to EBITDAX ratio of 4.00 to 1.00, and (ii) a current ratio of not less than 1.00 to 1.00; and

●

certain events of default, including, without limitation: non-payment; breaches of representations and warranties; non-compliance with covenants or other agreements; cross-default to material indebtedness; judgments; change of control; and voluntary and involuntary bankruptcy.

Borrowing Base Redetermination Agreement and Seventh Amendment

On December 9, 2022, OLLC, entered into the Borrowing Base Redetermination Agreement and Seventh Amendment to Credit Agreement. The Seventh Amendment amends the Revolving Credit Facility, to, among other things:

●

extend the maturity date from November 2, 2023 to May 31, 2024;

●

reduce the borrowing base under the Revolving Credit Facility to $215.0 million; provided that, beginning on December 31, 2022, the borrowing base will be reduced by $5.0 million per month on the last calendar day of each month. The borrowing base, as reduced on each date pursuant to the foregoing sentence, shall remain in effect until otherwise redetermined or adjusted in accordance with the provisions of the Credit Agreement;

●

adjust the minimum hedging requirements;

●

reduce the maximum consolidated net leverage ratio (as defined in the Credit Agreement) requirement from 4.00 to 1.00 to 3.00 to 1.00;

●

transition from London Inter-Bank Offered Rate to Secured Overnight Financing Rate based interest rates; and

●

remove the Company’s ability to pay dividends through the maturity date.

Borrowing Base Redetermination Agreement and Sixth Amendment

On June 20, 2022, OLLC entered into the Borrowing Base Redetermination Agreement and Sixth Amendment to the Credit Agreement. The Sixth Amendment amends the Revolving Credit Facility to, among other things:

●

terminate the automatic monthly reductions of the borrowing base;

●

reaffirm the borrowing base under the Revolving Credit Facility at $225.0 million and;

●

modify the affirmative hedging covenant.

Borrowing Base Redetermination Agreement and Fifth Amendment

On November 10, 2021, the Company completed its scheduled semi-annual borrowing base redetermination process, pursuant to which the borrowing base under the Revolving Credit Facility was reaffirmed at $245.0 million; provided that, beginning on February 28, 2022, the borrowing base will be reduced by $5.0 million per month on the last calendar day of each month until the next regularly scheduled redetermination, which is expected to occur in April 2022.

Borrowing Base Redetermination

On June 16, 2021, the Company completed its scheduled semi-annual borrowing base redetermination process, pursuant to which the borrowing base under the Revolving Credit Facility was decreased from $260.0 million to $245.0 million. In addition to the redetermination, the administrative agent under the Revolving Credit Facility agreement was changed from Bank of Montreal to KeyBank.

Debt Compliance

As of December 31, 2022, we were in compliance with all the financial (current ratio and total leverage ratio) and non-financial covenants associated with the Company’s Revolving Credit Facility.

Paycheck Protection Program

On April 24, 2020, the Company received a $5.5 million loan under the Paycheck Protection Program (the “PPP Loan”). The Paycheck Protection Program was established as part of the CARES Act to provide loans to qualifying businesses. The loans and accrued interest are potentially forgivable, provided that the borrower uses the loan proceeds for eligible purposes. The term of the Company’s PPP Loan was two years with an annual interest rate of 1% and no payments of principal or interest due during the six-month period beginning on the date of the PPP Loan. The Company applied for forgiveness of the amount due on the PPP Loan based on spending the loan proceeds on eligible expenses as defined by the statute. On June 22, 2021, KeyBank notified the Company that the PPP Loan had been approved for full and complete forgiveness by the Small Business Association. For the year ended December 31, 2021, the Company reported a gain on extinguishment of debt of $5.5 million for the PPP Loan forgiveness in the Consolidated Statements of Operations.

Weighted-Average Interest Rates

The following table presents the weighted-average interest rates paid on variable-rate debt obligations for the periods presented:


	For the Year Ended
	December 31,
	2022		2021
Revolving Credit Facility	5.36	%	3.65	%

Letters of credit

At December 31, 2022, the Company had no letters of credit outstanding.

Unamortized Deferred Financing Costs

Unamortized deferred financing costs associated with the Revolving Credit Facility was $1.5 million at December 31, 2022. The unamortized deferred financing costs are amortized over the remaining life of the Revolving Credit Facility using the straight-line method, which generally approximates the effective interest method.