Long-Term Debt

The following long-term debt obligations were outstanding as of December 31, 2019 and 2018:



	December 31,
In thousands	2019			2018
Senior Secured Credit Facility	$	247,000		$	183,000
11.25% Senior Notes due 2023	250,000			250,000
Mortgage debt	8,931			9,151
Other	271			275
Total	506,202			442,426
Less unamortized discount	(3,375		)	(4,500		)
Less unamortized debt issuance costs	(759		)	(1,044		)
Total net of discount and debt issuance costs	502,068			436,882
Less current obligations⁽¹⁾	(247,000		)	—
Long-term debt	$	255,068		$	436,882

(1) Current obligations represent the Senior Secured Credit Facility obligations which were classified as current liabilities as of December 31, 2019. See Waiver and Eleventh Amendment below for further discussion.

Senior Secured Credit Facility

In July 2015, the Company, through its subsidiary Lonestar Resources America, Inc. ("LRAI"), entered into a $500 million Senior Secured Credit Facility with Citibank, N.A., as administrative agent, and other lenders party thereto (as amended, supplemented or modified from time to time, the “Credit Facility”), which has a maturity date of November 15, 2023. As of December 31, 2019, $247.0 million was borrowed under the Credit Facility, and the weighted average interest rate on borrowings under the Credit Facility for the year was 5.28%. Borrowing availability was $42.6 million as of December 31, 2019, which reflects $0.4 million of letters of credit outstanding.

The Credit Facility may be used for loans and, subject to a $2.5 million sub-limit, letters of credit, and provides for a commitment fee of 0.375% to 0.5% based on the unused portion of the borrowing base under the Credit Facility. As of December 31, 2019, the borrowing base and lender commitments for the Credit Facility was $290 million. The borrowing base under the Credit Facility is determined semi-annually as of May 1 and November 1 and the next borrowing base redetermination will be May 1, 2020. Given current market conditions, it is reasonably possible that the borrowing base will decrease as a result of this next redetermination, which could lead to a deficiency and require the Company to prepay the deficiency over six months beginning within 45 days of the election notice.

Borrowings under the Credit Facility, at Lonestar's election, bear interest at either: (i) an alternate base rate (“ABR”) equal to the higher of (a) the Prime Rate, (b) the Federal Funds Effective Rate plus 0.5% per annum, and (c) the adjusted LIBO rate of a three-month interest period on such day plus 1.0%; or (ii) the adjusted LIBO rate, which is the rate stated on Reuters screen LIBOR1 page, for one, two, three, six or twelve months, as adjusted for statutory reserve requirements for Eurocurrency liabilities, plus, in each of the cases described in clauses (i) and (ii) above, an applicable margin ranging from 1.0% to 2.0% for ABR loans and from 2.0% to 3.0% for adjusted LIBO rate loans.

Subject to certain permitted liens, the Company's obligations under the Credit Facility have been secured by the grant of a first priority lien on no less than 80% of the value of the proved oil and gas properties of the Company and its subsidiaries (90% at December 31, 2019).

The Credit Facility contains certain financial performance covenants, as defined in the Credit Facility, including the following:


•	A maximum debt to EBITDAX ratio of 4.0 to 1.0, and


•	A current ratio of not less than 1.0 to 1.0.

The Company was not in compliance with the terms of the Credit Facility as of December 31, 2019 because the Company did not satisfy the consolidated current ratio at that time and the audit report corresponding to these financial statements includes an explanatory paragraph expressing uncertainty as to our ability to continue as a “going concern.” Such failures represent defaults under our revolving credit facility which we received a Waiver for (see below).

Seventh Amendment

In January 2018, the Company entered into the Limited Waiver, Borrowing Base Redetermination Agreement, and Amendment No. 7 to the Credit Agreement (the "Seventh Amendment"), which (i) maintained the borrowing base of $160 million until the next redetermination date; (ii) waived the borrowing base redetermination that would otherwise have occurred in connection with the incurrence of the 11.25% Senior Notes (see below), and (iii) amended certain other provisions of the Credit Facility.

Eighth Amendment

In May 2018, the Company entered into the Borrowing Base Redetermination Agreement and Amendment No. 8 to Credit Agreement (the "Eighth Amendment"), which (i) increased the borrowing base from $160 million to $190 million and (ii) reallocated the commitments and outstanding loans among lenders.

Ninth Amendment

In November 2018, the Company entered into the Ninth Amendment and Joinder (the "Ninth Amendment"), which (i) increased the borrowing base from $190 million to $275 million; (ii) extended the maturity date of the Credit Facility to November 15, 2023, and (iii) amended certain other provisions of the Credit Facility.

Tenth Amendment

In June 2019, the Company entered into the Borrowing Base Redetermination and Tenth Amendment to Credit Agreement (the "Tenth Amendment"), which (i) increased the borrowing base from $275 million to $290 million and (ii) amended certain other provisions of the Credit Facility.

Waiver and Eleventh Amendment

The Company entered into the Limited Waiver and Eleventh Amendment to Credit Agreement (the “Waiver”), effective as of April 7, 2020, with certain lenders and Citibank, N.A., as administrative bank, to waive the events of default arising from our failure to comply with the consolidated current ratio as of December 31, 2019, to timely provide audited financial statements, and to provide financial statements that are not subject to any “going concern” or like qualification or exception for the fiscal year ended December 31, 2019. Although the Company has entered into the Waiver, there is no guarantee that the Company's lenders will agree to waive events of default or potential events of default in the future. Accordingly, the amount outstanding under the Credit Facility as of December 31, 2019 has been classified as current on the accompanying Consolidated 2019 Balance Sheet.

11.25% Senior Notes

In January 2018, the Company issued $250 million of 11.250% senior notes due 2023 (the “11.25% Senior Notes”) to U.S.-based institutional investors. The net proceeds of $244.4 million were used to fully retire the 8.75% Senior Notes (as defined below), which included principal, interest and a prepayment premium of approximately $162 million. The remaining net proceeds were used to reduce borrowings under the Credit Facility.

The 11.25% Senior Notes mature on January 1, 2023, and bear interest at the rate of 11.25% per year, payable on January 1 and July of each year. At any time prior to January 1, 2021, the Company may, on any one or more occasions, redeem up to 35% of the aggregate principal amount of the 11.25% Senior Notes with an amount of cash not greater than the net cash proceeds of certain equity offerings at a redemption price equal to 111.25% of the principal amounts redeemed, plus accrued and unpaid interest, provided that at least 65% of the aggregate principal amount of 11.25% Senior Notes originally issued remains outstanding immediately after such redemption and the redemption occurs within 180 days of the closing date of such equity offering.

At any time prior to January 1, 2021, the Company may, on any one or more occasions, redeem all or a part of the 11.25% Senior Notes at a redemption price equal to 100% of the principal amount redeemed, plus a “make-whole” premium as of, and accrued and unpaid interest.

On and after January 1, 2021, the Company may redeem the 11.25% Senior Notes, in whole or in part, plus accrued and unpaid interest, at the following redemption prices: 108.438% after January 1, 2021; 105.625% after January 1, 2022; and 100% after July 1, 2022.

The indenture contains certain restrictions on the Company’s ability to incur additional debt, pay dividends on the Company’s common stock, make investments, create liens on the Company’s assets, engage in transactions with affiliates, transfer or sell assets, consolidate or merge, or sell substantially all of the Company’s assets. The indenture also contains cross-default provisions for defaults of the Company's other debt instruments, including the Credit Facility, caused by payment default or events which cause the acceleration of repayment prior to the stated maturity of such instrument.

Retirement of 8.75% Senior Notes

Using proceeds from the issuance of the 11.25% Senior Notes, as discussed above, the Company fully retired the 8.750% Senior Unsecured Notes due April 15, 2019 (“the 8.75% Senior Notes”) in January 2018. Pursuant to the terms of the indenture, the 8.75% Senior Notes were redeemed at 104.375% of the outstanding principal amount, or approximately $158.5 million, which excluded accrued interest. In connection with this transaction, the Company recognized a $8.6 million loss on extinguishment during the first quarter of 2018.

Debt Issuance Costs

The Company capitalizes certain direct costs associated with the issuance of long-term debt and amortizes such costs over the lives of the respective debt. At December 31, 2019 and 2018, the Company had approximately $0.7 million and $1.7 million, respectively, of debt issuance costs associated with issuance of the Credit Facility remaining that are being amortized over the lives of the respective debt which are recorded as Other Non-Current Assets in the accompanying unaudited condensed consolidated balance sheets.

Indebtedness Repayment Schedule

As of December 31, 2019, our debt is payable over the next five years and thereafter as follows:




In thousands
2020	$	247,084
2021	71
2022	76
2023	250,081
2024	86
Thereafter	8,804
Total debt	$	506,202