Quarterly report pursuant to Section 13 or 15(d)

Borrowings

v2.4.0.6
Borrowings
 3 Months Ended
Mar. 31, 2013
Debt Disclosure [Abstract]  
Borrowings


The Company’s borrowings consisted of the following at:
 
 
March 31, 2013
 
December 31, 2012
Principal components:
 
 
 
 
Credit Facility
 
$
27,000

 
$
10,000

13% Senior Notes due 2016, principal
 
96,961

 
96,961

Total principal outstanding
 
123,961

 
106,961

Non-cash components:
 
 

 
 

13% Senior Notes due 2016 unamortized deferred credit
 
12,908

 
13,707

Total carrying value of borrowings
 
$
136,869

 
$
120,668



Senior Secured Revolving Credit Facility (the “Credit Facility”)

The Company's $200,000 Credit Facility had an associated borrowing base at March 31, 2013 of $65,000 and a maturity of March 15, 2016. Regions Bank serves as the administrative agent for the Credit Facility, which also includes Citibank, NA, IberiaBank, Whitney Bank and OneWest Bank, FSB as participating lenders. Amounts borrowed under the Credit Facility may not exceed a borrowing base, which is generally reviewed on a semi-annual basis and is then eligible for re-determination. The Credit Facility is secured by mortgages covering the Company's major producing fields.

In April 2013, the Credit Facility's borrowing base was increased $10,000 from $65,000 to $75,000.

As of March 31, 2013, the balance outstanding on the Credit Facility was $27,000 with an interest rate of 3.1%, calculated as the London Interbank Offered Rate (“LIBOR”) plus a tiered rate ranging from 2.5% to 3.0%, which is based on utilization of the facility. In addition, the Credit Facility carries a commitment fee of 0.5% per annum on the unused portion of the borrowing base, which is payable quarterly. As of May 6, 2013, the balance outstanding on the Credit Facility was $38,000 as the Company drew an additional $11,000 in support of the Company's ongoing capital development program.

13% Senior Notes due 2016 (“Senior Notes”) and Deferred Credit

The Senior Notes’ 13% interest coupon is payable on the last day of each quarter. Certain of the Company’s subsidiaries guarantee the Company’s obligations under the unsecured Senior Notes. The subsidiary guarantors are 100% owned, all of the guarantees are full and unconditional and joint and several, the parent company has no independent assets or operations, and any subsidiaries of the parent company other than the subsidiary guarantors are minor. Upon issuing the Senior Notes in November 2009, the Company recorded as a deferred credit the $31,507 difference between the adjusted carrying amount of the Senior Notes that were exchanged and the principal of the Senior Notes. This deferred credit is being amortized as a reduction of interest expense over the life of the Senior Notes at an 8.5% effective interest rate. The following table summarizes the Company’s deferred credit balance:
Gross Carrying
 
Accumulated Amortization at
 
Carrying Value at
 
Amortization Recorded during Current Year as a Reduction of
 
Estimated Amortization to be Recorded during the Remainder of the
 Amount
 
3/31/2013
 
3/31/2013
 
Interest Expense
 
 Current Year
$31,507
 
$18,599
 
$12,908
 
$799
 
$2,500


Restrictive Covenants

The indentures governing our Senior Notes and the Company’s Credit Facility contain various covenants including restrictions on additional indebtedness and payment of cash dividends. In addition, Callon’s Credit Facility contains covenants for maintenance of certain financial ratios. The Company was in compliance with these covenants at March 31, 2013.