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Long-Term Debt

9 Months Ended

Sep. 30, 2023

Note 7. Long-Term Debt

The following table presents the Company’s consolidated debt obligations at the dates indicated:


	September 30,		December 31,
	2023		2022

	(In thousands)
Revolving Credit Facility (1)	$	120,000	$	190,000
Total long-term debt	$	120,000	$	190,000

(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.

Amended and Restated Credit Agreement

On July 31, 2023, OLLC and Amplify Acquisitionco LLC (“Acquisitionco”), as the direct parent of OLLC and wholly owned subsidiary of the Company, amended and restated the Revolving Credit Facility with Keybanc Capital Markets Inc., Cadence Bank, N.A. and Citizens Bank, N.A. as joint lead arrangers and KeyBank National Association as the administrative agent (the “New Credit Facility”). The New Credit Facility is a replacement in full of the prior Revolving Credit Facility.

The aggregate principal amount of loans outstanding under the New Credit Facility as of September 30, 2023, was $120.0 million. The borrowing base under the facility is $150.0 million with elected commitments of $135.0 million, and, consistent with the prior Revolving Credit Facility, the New Credit Facility borrowing base will be redetermined on a semi-annual basis.

Certain key terms and conditions under the New Credit Facility include (but are not limited to):

●

A maturity date of July 31, 2027;

●

The loans shall bear interest at a rate per annum equal to (i) adjusted SOFR or (ii) an adjusted base rate, plus an applicable margin based on a utilization ratio of the lesser of the borrowing base and the aggregate commitments. The applicable margin ranges from 2.00% to 3.00% for adjusted base rate borrowings, and 3.00% to 4.00% for adjusted SOFR borrowings;

●

The unused commitments under the New Credit Facility will accrue a commitment fee of 0.50%, payable quarterly in arrears;

●

Certain financial covenants, including the maintenance of (i) a net debt leverage ratio not to exceed 3.00 to 1.00, determined as of the last day of each fiscal quarter for the four fiscal-quarter period then ending and (ii) a current ratio of not less than 1.00 to 1.00, determined as of the last day of each fiscal quarter, in each case commencing with the fiscal quarter ending December 31, 2023;

●

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; and

●

Initial minimum hedging requirements covering 75% of the reasonably projected monthly production of hydrocarbons from proved developed producing reserves for the 24-month period following the effective date of the New Credit Facility (the “First Period”) and (ii) 50% for the 12-month period immediately following the First Period.

As of September 30, 2023, the Company was in compliance with all the financial (current ratio and total leverage ratio) and non-financial covenants associated with its New Credit Facility.

On October 19, 2023, the Company completed the fall 2023 borrowing base redetermination, which reaffirmed the borrowing base of $150.0 million with elected commitments of $135.0 million. The next redetermination is expected to occur in the second quarter of 2024.

Revolving Credit Facility

Prior to the New Credit Facility, OLLC had a reserve-based Revolving Credit Facility with a borrowing base of $180.0 million when such Revolving Credit Facility was replaced with the New Credit Facility. The Revolving Credit Facility was guaranteed by the Company and all of its current subsidiaries and would have matured on May 31, 2024.

Weighted-Average Interest Rates

The following table presents the weighted-average interest rates paid, excluding commitment fees, on the Company’s consolidated variable-rate debt obligations for the periods presented:


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Revolving Credit Facility	9.39	%	5.91	%	9.34	%	4.73	%

Letters of Credit

At September 30, 2023, the Company had no letters of credit outstanding.

Unamortized Deferred Financing Costs

Unamortized deferred financing costs associated with the Company’s Revolving Credit Facility was $4.5 million at September 30, 2023. For the nine months ended September 30, 2023, the Company wrote off $1.0 million of deferred financing costs in connection with the refinancing of the Revolving Credit Facility.