GDP » Topics » Senior Credit Facility

This excerpt taken from the GDP 8-K filed Sep 18, 2009.

Senior Credit Facility

In 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

36


GOODRICH PETROLEUM CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at December 31, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

These excerpts taken from the GDP 10-Q filed May 7, 2009.

Senior Credit Facility

In 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “2005 Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the 2005 Senior Credit Facility were $200 million, and the 2005 Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the 2005 Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount outstanding under the 2005 Senior Credit Facility in July 2008 with proceeds from our equity offering. Interest on revolving borrowings under the 2005 Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At March 31, 2009, we had a borrowing base of $175 million and no amounts outstanding under the 2005 Senior Credit Facility.

Substantially all our assets are pledged as collateral to secure the 2005 Senior Credit Facility.

The terms of the 2005 Senior Credit Facility require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the 2005 Senior Credit Facility. As of March 31, 2009, we were in compliance with all of the financial covenants of our 2005 Senior Credit Facility. The covenants in effect at March 31, 2009 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

On May 5, 2009, we entered into a Second Amended and Restated Credit Agreement (“Senior Credit Facility”) which will replace the current facility. Total lender commitments under the Senior Credit Facility will be $350 million. The Senior Credit Facility will mature on October 1, 2010 and under certain conditions related to our refinancing of the Second Lien Term Loan can be extended to August 31, 2011. The Senior Credit Facility can be further extended to July 1, 2012 upon receipt of proceeds from a refinancing sufficient to prepay the convertible senior notes. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. The initial borrowing base was established at $175 million. The borrowing base interest on revolving borrowings under the Senior Credit Facility will accrue at a rate calculated, at our option, at the bank base rate plus 0.75% to 1.50%, or LIBOR plus 2.25% to 3.00%, depending on borrowing base utilization. Pursuant to the terms of the

 

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Table of Contents

GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

Senior Credit Facility, borrowing base redeterminations will be on a semi-annual basis on each April 1 and October 1 beginning on October 1, 2009.

The terms of the Senior Credit Facility will require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Second amended Senior Credit Facility. The initial covenants include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters; and

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.)

Senior Credit Facility

In 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “2005 Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the 2005 Senior Credit Facility were $200 million, and the 2005 Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the 2005 Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount outstanding under the 2005 Senior Credit Facility in July 2008 with proceeds from our equity offering. Interest on revolving borrowings under the 2005 Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At March 31, 2009, we had a borrowing base of $175.0 million and no amounts outstanding under the 2005 Senior Credit Facility.

Substantially all our assets are pledged as collateral to secure the 2005 Senior Credit Facility.

The terms of the 2005 Senior Credit Facility require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of March 31, 2009, we were in compliance with all of the financial covenants of our 2005 Senior Credit Facility. The covenants in effect at March 31, 2009 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

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Table of Contents
   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

On May 5, 2009, we entered into a Second Amended and Restated Credit Agreement (“Senior Credit Facility”) which will replace the current facility. Total lender commitments under the Senior Credit Facility will be $350 million. The Senior Credit Facility will mature on October 1, 2010 and under certain conditions related to our refinancing of the Second Lien Term Loan can be extended to August 31, 2011 and can be further extended to July 1, 2012 upon receipt of proceeds from a refinancing sufficient to prepay the convertible senior notes. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. The initial borrowing base will be established at $175 million. The borrowing base interest on revolving borrowings under Senior Credit Facility will accrue at a rate calculated, at our option, at the bank base rate plus 0.75% to 1.50%, or LIBOR plus 2.25% to 3.00%, depending on borrowing base utilization. Pursuant to the terms of the Senior Credit Facility, borrowing base redeterminations will be on a semi-annual basis on each April 1 and October 1 beginning on October 1, 2009.

The terms of the Senior Credit Facility will require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Second amended Senior Credit Facility. The initial covenants include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters; and

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.)

These excerpts taken from the GDP 10-K filed Feb 27, 2009.

Senior Credit Facility

 

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are

 

40


Table of Contents
Index to Financial Statements

limited to, and subject to periodic redeterminations of the borrowing base. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior Credit Facility, the next redetermination of our borrowing base will be March 31, 2009. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

 

Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008, we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at December 31, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt of no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives, but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excluding 3.25% convertible senior notes) of not less than 1.5 to 1.0.

 

Senior Credit Facility

 

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are

 

40


Table of Contents
Index to Financial Statements

limited to, and subject to periodic redeterminations of the borrowing base. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior Credit Facility, the next redetermination of our borrowing base will be March 31, 2009. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

 

Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008, we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at December 31, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt of no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives, but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excluding 3.25% convertible senior notes) of not less than 1.5 to 1.0.

 

Senior Credit Facility

 

In 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

 

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Index to Financial Statements

GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

 

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at December 31, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

 

Senior Credit Facility

 

In 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

 

F-19


Table of Contents
Index to Financial Statements

GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

 

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at December 31, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

 

Senior Credit
Facility

 

In 2005, we amended our existing credit
agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were
$200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount
outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to
0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior
Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

FACE="Times New Roman" SIZE="2">Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

STYLE="margin-top:0px;margin-bottom:0px"> 


F-19







Table of Contents


Index to Financial Statements



GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

STYLE="margin-top:0px;margin-bottom:-6px"> 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

 


The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants.
Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in
effect at December 31, 2008 include:

 







  

Current Ratio of 1.0/1.0;

 







  

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

SIZE="1"> 







  

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense
and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from
the calculation of Total Debt for the purpose of computing this ratio.); and

 







  

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less
than 1.5 to 1.0.

 

Senior Credit
Facility

 

In 2005, we amended our existing credit
agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were
$200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount
outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to
0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior
Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

FACE="Times New Roman" SIZE="2">Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

STYLE="margin-top:0px;margin-bottom:0px"> 


F-19







Table of Contents


Index to Financial Statements



GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

STYLE="margin-top:0px;margin-bottom:-6px"> 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

 


The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants.
Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in
effect at December 31, 2008 include:

 







  

Current Ratio of 1.0/1.0;

 







  

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

SIZE="1"> 







  

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense
and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from
the calculation of Total Debt for the purpose of computing this ratio.); and

 







  

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less
than 1.5 to 1.0.

 

Senior Credit
Facility

 

In 2005, we amended our existing credit
agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were
$200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. We paid off the total amount
outstanding under the Senior Credit Facility in July, 2008 with proceeds from our equity offering. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to
0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization. At December 31, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. Pursuant to the terms of our Senior
Credit Facility, the next redetermination of our borrowing base will be March 31, 2009.

 

FACE="Times New Roman" SIZE="2">Substantially all our assets are pledged as collateral to secure the Senior Credit Facility.

 

STYLE="margin-top:0px;margin-bottom:0px"> 


F-19







Table of Contents


Index to Financial Statements



GOODRICH PETROLEUM CORPORATION AND SUBSIDIARIES

STYLE="margin-top:0px;margin-bottom:-6px"> 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

 


The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants.
Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of December 31, 2008 we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in
effect at December 31, 2008 include:

 







  

Current Ratio of 1.0/1.0;

 







  

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

SIZE="1"> 







  

Total Debt no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense
and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings include realized gains (losses) from derivatives but exclude unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from
the calculation of Total Debt for the purpose of computing this ratio.); and

 







  

Asset coverage ratio (defined as the present value of proved reserves discounted at 10% divided by total debt, excludes 3.25% convertible senior notes) of not less
than 1.5 to 1.0.

 

This excerpt taken from the GDP 10-Q filed Nov 6, 2008.

Senior Credit Facility

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. At September 30, 2008, we had a borrowing base of $175.0 million and no amounts outstanding under the Senior Credit Facility. On October 31, 2008, based upon the mid-year reserve report, the bank group reaffirmed the borrowing base at $175.0 million until the next semi-annual redetermination. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of September 30, 2008, we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at September 30, 2008 include:

 

   

Current Ratio of 1.0/1.0;

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters;

 

   

Total Debt of no greater than 3.0 times EBITDAX for the trailing four quarters (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings includes realized gains (losses) from derivatives, but excludes unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.); and

 

   

Asset coverage ratio (defined as the present value of proved reserves discounted 10% total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0.

This excerpt taken from the GDP 10-Q filed Aug 8, 2008.

Senior Credit Facility

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities and extended our credit facility for an additional two years. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. On January 11, 2008, we entered into the Ninth Amendment to our Senior Credit Facility. The amendment included the reduction in the borrowing base to $150 million less 30% of the Second Lien Term Loan (discussed below) in excess of $50 million. At June 30, 2008, we had a borrowing base of $175.0 million under the Senior Credit Facility and we had $81.0 million in outstanding revolving borrowings under the Facility. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.75%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of June 30, 2008, we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at June 30, 2008 include:

 

   

Current Ratio of 1.0/1.0,

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters, and

 

   

Total Debt of no greater than 3.0 times EBITDAX for the trailing four quarters. (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings includes realized gains (losses) from derivatives, but excludes unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.)

This excerpt taken from the GDP 10-Q filed May 8, 2008.

Senior Credit Facility

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities and extended our credit facility for an additional two years. Total lender commitments under the Senior Credit Facility were $200 million, and the Senior Credit Facility matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base. On January 11, 2008, we entered into the Ninth Amendment to our Senior Credit Facility. The amendment included the reduction in the borrowing base to $150 million less 30% of the Second Lien Term Loan (discussed below) in excess of $50 million. At March 31, 2008, we had a borrowing base of $142.5 million under the Senior Credit Facility and we had $34.0 million in outstanding revolving borrowings under the Facility. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.50%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

On May 7, 2008, the bank group established the new borrowing base at $175 million.

The terms of the Senior Credit Facility, as amended, require us to maintain certain covenants. Capitalized terms used, but not defined, here have the meanings assigned to them in the Senior Credit Facility. As of March 31, 2008, we were in compliance with all of the financial covenants of our Senior Credit Facility. The covenants in effect at March 31, 2008 include:

 

   

Current Ratio of 1.0/1.0,

 

   

Interest Coverage Ratio of not less than 3.0/1.0 for the trailing four quarters, and

 

   

Total Debt of no greater than 3.0 times EBITDAX for the trailing four quarters. (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings includes realized gains (losses) from derivatives, but excludes unrealized gains (losses) from derivatives. The 3.25% convertible senior notes are excluded from the calculation of Total Debt for the purpose of computing this ratio.)

These excerpts taken from the GDP 10-K filed Mar 13, 2008.

Senior Credit Facility

 

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities and extended our credit facility for an additional two years. Total lender commitments under the Senior Credit Facility were $200 million which matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base, which was established at $170 million as of December 31, 2007. At that date we had $40.5 million in outstanding revolving borrowings under the Senior Credit Facility. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus 0.00% to 0.50%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

 

The terms of the Senior Credit Facility require us to maintain certain covenants. Capitalized terms are defined in the credit agreement. The covenants in effect at December 31, 2007 include:

 

   

Current Ratio of 1.0/1.0,

 

   

Interest Coverage Ratio which is not less than 3.0/1.0 for the trailing four quarters, and

 

   

Total Debt no greater than 4.25 times EBITDAX for the trailing four quarters. (EBITDAX is earnings before interest expense, income tax, DD&A, exploration expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings includes realized gains (losses) from derivatives not qualifying for hedge accounting, but excludes unrealized gains (losses) from derivatives not qualifying for hedge accounting.)

 

On August 7, 2007, we entered into the Sixth Amendment to our Senior Credit Facility which amended the last of the above financial covenants beginning with the quarter ending June 30, 2007 and ending with the quarter ending December 31, 2007. The financial covenant was set to return to a 3.5 times Debt to EBITDAX limitation for the trailing four quarters beginning with the quarter ending March 31, 2008 by the terms of the Sixth Amendment. As a result of the sale of our South Louisiana assets in the first quarter of 2007 (see Note 6 “Discontinued Operations” to our consolidated financial statements), a preliminary EBITDAX calculation for the trailing four quarters ending June 30, 2007 (which excluded all EBITDAX generated by the sold South Louisiana assets) indicated that we might not be in compliance with the ratio at the 3.5 times limitation. As a result, we requested, and the bank group approved, amending the ratio as discussed above for the purpose of clarifying the calculation of the covenant.

 

On September 25, 2007, we entered into the Seventh Amendment to our Senior Credit Facility. This amendment increased the borrowing base from $110 million to $170 million and increased the upper limit of the LIBOR plus rate from 2.0% to 2.25%. All the other material terms remained the same.

 

On November 30, 2007, we entered into an Eighth Amendment to our Senior Credit Facility. The amendment included the following provisions:

 

   

allows us to enter into a new Second Lien Term Loan of up to $100 million to mature on December 31, 2010;

 

   

permits us to use proceeds from our equity offering to purchase capped call options at a cost of up to $35 million;

 

   

amends certain negative covenants in the event we enter into a new Second Lien Term Loan facility;

 

As of December 31, 2007, we were in compliance with all of the financial covenants of our Senior Credit Facility.

 

On January 11, 2008, we entered into the Ninth Amendment to our Senior Credit Facility. The amendment included the following provisions:

 

   

restated certain defined terms to reflect that the new Second Lien Term Loan did not close by December 31, 2007;

 

34


Table of Contents
   

and in the event we entered into the new Second Lien Term Loan,

 

   

reduces the borrowing base to $150 million less 30% of the amount of the second lien term loan in excess of $50 million; and

 

   

revised the debt to EBITDAX ratio to (i) exclude the 3.25% convertible senior notes from the calculation and (ii) set the ratio at a maximum of 3.0 to 1.0.

 

On January 16, 2008, we entered into a new Second Lien Term Loan Agreement which provides for a 3-year, non-revolving loan of $75.0 million and is due in a single maturity on December 31, 2010. There are no rights to prepay in the first year. Voluntary prepayment rights in the second year are at 101% of par, and thereafter at par. Interest on the term loan borrowing accrues at a rate of LIBOR plus 550 basis points and is payable quarterly in arrears. The terms of the Second Lien Term Loan Agreement contain material financial covenants which include:

 

   

an asset coverage ratio (defined as the present value of proved reserves discounted at 10% to total debt, excludes 3.25% convertible senior notes) of not less than 1.5 to 1.0;

 

   

a total debt to EBITDAX ratio of not more than 3.0 to 1.0 (total debt to exclude the 3.25% convertible senior notes); and

 

   

an EBITDAX to interest expense ratio of not less than 3.0 to 1.0.

 

Senior Credit Facility

SIZE="1"> 

On November 17, 2005, we amended our existing credit agreement and entered into an amended and restated senior credit
agreement (as amended, the “Senior Credit Facility”) and a term loan that expanded our borrowing capabilities and extended our credit facility for an additional two years. Total lender commitments under the Senior Credit Facility were $200
million which matures on February 25, 2010. Revolving borrowings under the Senior Credit Facility are limited to, and subject to periodic redeterminations of the borrowing base, which was established at $170 million as of December 31,
2007. At that date we had $40.5 million in outstanding revolving borrowings under the Senior Credit Facility. Interest on revolving borrowings under the Senior Credit Facility accrues at a rate calculated, at our option, at the bank base rate plus
0.00% to 0.50%, or LIBOR plus 1.25% to 2.25%, depending on borrowing base utilization.

 

FACE="Times New Roman" SIZE="2">The terms of the Senior Credit Facility require us to maintain certain covenants. Capitalized terms are defined in the credit agreement. The covenants in effect at December 31, 2007 include:

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

Current Ratio of 1.0/1.0,

 







  

Interest Coverage Ratio which is not less than 3.0/1.0 for the trailing four quarters, and

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

Total Debt no greater than 4.25 times EBITDAX for the trailing four quarters. (EBITDAX is earnings before interest expense, income tax, DD&A, exploration
expense and impairment of oil and gas properties. In calculating EBITDAX for this purpose, earnings includes realized gains (losses) from derivatives not qualifying for hedge accounting, but excludes unrealized gains (losses) from derivatives not
qualifying for hedge accounting.)

 

On
August 7, 2007, we entered into the Sixth Amendment to our Senior Credit Facility which amended the last of the above financial covenants beginning with the quarter ending June 30, 2007 and ending with the quarter ending December 31,
2007. The financial covenant was set to return to a 3.5 times Debt to EBITDAX limitation for the trailing four quarters beginning with the quarter ending March 31, 2008 by the terms of the Sixth Amendment. As a result of the sale of our South
Louisiana assets in the first quarter of 2007 (see Note 6 “Discontinued Operations” to our consolidated financial statements), a preliminary EBITDAX calculation for the trailing four quarters ending June 30, 2007 (which excluded all
EBITDAX generated by the sold South Louisiana assets) indicated that we might not be in compliance with the ratio at the 3.5 times limitation. As a result, we requested, and the bank group approved, amending the ratio as discussed above for the
purpose of clarifying the calculation of the covenant.

 

On
September 25, 2007, we entered into the Seventh Amendment to our Senior Credit Facility. This amendment increased the borrowing base from $110 million to $170 million and increased the upper limit of the LIBOR plus rate from 2.0% to 2.25%. All
the other material terms remained the same.

 

On
November 30, 2007, we entered into an Eighth Amendment to our Senior Credit Facility. The amendment included the following provisions:

 







  

allows us to enter into a new Second Lien Term Loan of up to $100 million to mature on December 31, 2010;

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

permits us to use proceeds from our equity offering to purchase capped call options at a cost of up to $35 million;

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

amends certain negative covenants in the event we enter into a new Second Lien Term Loan facility;

STYLE="margin-top:0px;margin-bottom:0px"> 

As of December 31, 2007, we were in compliance with all of the financial
covenants of our Senior Credit Facility.

 

On January 11,
2008, we entered into the Ninth Amendment to our Senior Credit Facility. The amendment included the following provisions:

 







  

restated certain defined terms to reflect that the new Second Lien Term Loan did not close by December 31, 2007;

STYLE="margin-top:0px;margin-bottom:0px"> 


34







Table of Contents









  

and in the event we entered into the new Second Lien Term Loan,

 







  

reduces the borrowing base to $150 million less 30% of the amount of the second lien term loan in excess of $50 million; and

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

revised the debt to EBITDAX ratio to (i) exclude the 3.25% convertible senior notes from the calculation and (ii) set the ratio at a maximum of 3.0 to
1.0.

 

On January 16, 2008, we entered
into a new Second Lien Term Loan Agreement which provides for a 3-year, non-revolving loan of $75.0 million and is due in a single maturity on December 31, 2010. There are no rights to prepay in the first year. Voluntary prepayment rights in
the second year are at 101% of par, and thereafter at par. Interest on the term loan borrowing accrues at a rate of LIBOR plus 550 basis points and is payable quarterly in arrears. The terms of the Second Lien Term Loan Agreement contain material
financial covenants which include:

 







  

an asset coverage ratio (defined as the present value of proved reserves discounted at 10% to total debt, excludes 3.25% convertible senior notes) of not less than
1.5 to 1.0;

 







  

a total debt to EBITDAX ratio of not more than 3.0 to 1.0 (total debt to exclude the 3.25% convertible senior notes); and

STYLE="margin-top:0px;margin-bottom:-6px"> 







  

an EBITDAX to interest expense ratio of not less than 3.0 to 1.0.

 

"Senior Credit Facility" elsewhere:

Clayton Williams Energy (CWEI)
Rosetta Resources (ROSE)
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