LONG-TERM DEBT

A summary of long-term debt is as follows:



(In thousands)	September 30, 2013		September 30, 2012
Senior Notes, bearing fixed interest at 6.5% per annum, net of unamortized premium	$	658,232	$	450,000
2011 Revolving Credit Facility, bearing interest at approximately 3.0%⁽¹⁾ per annum at September 30, 2013 and 3.2%⁽¹⁾ per annum at September 30, 2012.	605,000		380,000
	$	1,263,232	$	830,000
(1) After the impact of our interest rate swaps.

6.5% Senior Notes due 2020

In January 2012, we issued $450 million aggregate principal amount of our 6.50% Senior Notes due 2020 (the "Senior Notes"). We received net proceeds, after deducting underwriting discounts and offering expenses, of approximately $440 million. We used the net proceeds to reduce outstanding borrowings under our Credit Facility (as defined below). On June 21, 2013, we issued an additional $200 million aggregate principal amount (the "Additional Notes") of our Senior Notes. The two issuances of Senior Notes together form a single series under the indenture with an aggregate principal amount of $650 million. We received net proceeds from the Additional Notes, after deducting underwriting discounts and offering expenses, of approximately $211.6 million. This amount includes $5.1 million of accrued interest due from February 1, 2013 through the date of issuance. The net proceeds also include a premium of $8.5 million to be amortized through maturity on February 1, 2020. The receipt of a premium results in an effective interest rate of 5.72% for the Additional Notes and an effective interest rate of 6.26% on the aggregate principal amount of $650 million.

The Senior Notes are our senior unsecured obligations and are not currently guaranteed by any of our subsidiaries. Interest is payable on the Senior Notes semi-annually in arrears. The indenture governing the Senior Notes contains provisions that limit our ability and the ability of our restricted subsidiaries to incur or guarantee additional indebtedness or issue preferred stock; pay dividends or make other restricted payments; sell assets; make investments; create liens; enter into agreements that restrict dividends or other payments from our restricted subsidiaries to us; and consolidate, merge or transfer all or substantially all of our assets. Many of these restrictions will terminate if the Senior Notes become rated investment grade. The indenture governing the Senior Notes also contains customary events of default, including payment defaults; defaults for failure to comply with other covenants in the indenture; cross-acceleration and entry of final judgments in excess of $50.0 million; and certain events of bankruptcy, in certain cases subject to notice and grace periods. We are required to offer to repurchase the Senior Notes in connection with specified change in control events or with excess proceeds of asset sales not applied for permitted purposes.

At any time prior to February 1, 2015, we may, on any one or more occasions, redeem up to 35% of the aggregate principal amount of the Senior Notes with the net cash proceeds of certain equity offerings at a redemption price set forth in the indenture governing the Senior Notes. At any time prior to February 1, 2016, we may, on any one or more occasions, redeem the Senior Notes in whole or in part at a redemption price equal to 100% of the principal amount of the Senior Notes redeemed plus a “make whole” premium. On and after February 1, 2016, we may, on any one or more occasions, redeem the Senior Notes in whole or in part at the redemption price set forth in the indenture governing the Senior Notes.

Revolving Credit Facility

As of September 30, 2013, we had $605 million of outstanding borrowings under our five-year aggregate $1.1 billion senior secured revolving credit facility.

The original five-year $750 million senior secured revolving credit facility was entered into in May 2011 and matures in May 2016 (the "Credit Facility"). Our wholly-owned subsidiary, Atwood Offshore Worldwide Limited (“AOWL”), is the borrower under the Credit Facility, and we and certain of our other subsidiaries are guarantors under the facility. Except as described below, borrowings under the Credit Facility bear interest at the Eurodollar rate plus a margin of 2.50%. Currently, certain borrowings effectively bear interest at a fixed rate due to our interest rate swaps. See Note 6 of the Notes to Consolidated Financial Statements in Item 8 of this Form 10-K. The average interest rate for borrowings under the Credit Facility was approximately 3.0% per annum at September 30, 2013, after considering the impact of our interest rate swaps. The Credit Facility also provides for the issuance, when requested, of standby letters of credit. The Credit Facility has a commitment fee of 1.0% per annum on the unused portion of $750 million of the underlying commitment. As of September 30, 2013, we had standby letters of credit issued in the aggregate amount of $0.1 million.

In July 2013, we and AOWL amended the Credit Facility to, among other things, eliminate all scheduled commitment reductions totaling $200 million under the Credit Facility. In addition, AOWL entered into an Incremental Commitment Agreement further modifying the Credit Facility. The Incremental Commitment Agreement provides for an additional tranche of commitments and increases the amount of the Credit Facility by $350 million to an aggregate of $1.1 billion. The maturity date of all borrowings under the Credit Facility remains May 6, 2016. Borrowings under the incremental tranche of commitments bear interest at the Eurodollar rate plus a margin ranging from 2.00% to 2.25%, based on our corporate credit ratings and a commitment fee of 0.5% per annum on the unused portion of the additional tranche. In connection with the Incremental Commitment Agreement, we mortgaged as additional collateral under the Credit Facility the Atwood Condor, as well as pledged the equity interests in our subsidiaries that own, directly or indirectly, the Atwood Condor. No other terms of the Credit Facility were amended by the Incremental Commitment Agreement, and all other terms and conditions of the Credit Facility, including the financial and other restrictive covenants set forth therein, are applicable to the incremental tranche of commitments. Subsequent to September 30, 2013, no additional borrowings were made under the Credit Facility.

Subject to the satisfaction of certain conditions precedent and the agreement by the lenders, the Credit Facility accordion may be exercised further to increase commitments by an additional $200 million for a total commitment of up to $1.3 billion.

The Credit Facility contains various financial covenants that impose a maximum leverage ratio of 4.0 to 1.0, a debt to capitalization ratio of 0.5 to 1.0, a minimum interest expense coverage ratio of 3.0 to 1.0 and a minimum collateral maintenance of 150% of the aggregate amount outstanding under the Credit Facility. In addition, the Credit Facility contains limitations on our and certain of our subsidiaries' ability to incur liens; merge, consolidate or sell substantially all assets; pay dividends (including restrictions on AOWL's ability to pay dividends to us); incur additional indebtedness; make advances, investments or loans; and transact with affiliates. The Credit Facility also contains customary events of default, including but not limited to delinquent payments, bankruptcy filings, material adverse judgments, guarantees or security documents not being in full effect, non-compliance with the Employee Retirement Income Security Act of 1974, cross-defaults under other debt agreements, or a change of control. The Credit Facility is secured primarily by first preferred mortgages on seven of our active drilling units (the Atwood Aurora, the Atwood Beacon, the Atwood Eagle, the Atwood Falcon, the Atwood Hunter, the Atwood Osprey, and the Atwood Condor), as well as liens on the equity interests of our subsidiaries that own, directly or indirectly, such drilling units. In addition, if we exercise the accordion feature and increase the total commitments, the Credit Facility requires that we provide a first preferred mortgage on the Atwood Mako and the Atwood Manta, as well as a lien on the equity interests of our subsidiaries that own, directly or indirectly, such rigs. We were in compliance with all financial covenants under the Credit Facility at September 30, 2013.