Debt

6 Months Ended

Jun. 30, 2025

As of June 30, 2025 and December 31, 2024, our debt consisted of the following:


	June 30,			December 31,
	2025			2024
Term loan	$	349,250		$	355,000
Revolving credit facility		25,000			30,000
Other		200			496
Total debt		374,450			385,496
Current portion of long-term debt		(171	)		(424	)
Unamortized debt issuance costs (1)		(3,407	)		(4,257	)
Total long-term debt	$	370,872		$	380,815

(1)

Unamortized debt issuance costs presented as a reduction to total debt are attributable to the Term Loan

Credit Facilities

On July 3, 2023, the Company entered into (i) a four-year term loan (the “Term Loan”), and (ii) a four-year revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan, the “Credit Facilities”), which were subsequently amended to, among other things, increase the principal amount of the Term Loan to $355.0 million and increase the available capacity of the Revolving Credit Facility to $100.0 million. Principal amounts borrowed under the Credit Facilities may be repaid from time to time without penalty. Any principal amounts outstanding on the maturity date, July 3, 2027, become due and payable on such date.

We may elect for outstanding borrowings under our Credit Facilities to accrue interest at a rate based on either (i) a forward-looking term rate based on the secured overnight financing rate (“Term SOFR Loans”) plus 0.10%, or (ii) the base rate (“Base Rate Loans”), in each case plus an applicable margin. Borrowings under our Credit Facilities accrue interest based on a five-tiered pricing grid tied to our current leverage ratio. The applicable margin ranges are:


	Pre-IPO			Post-IPO
Term SOFR applicable margin	3.00% - 4.00%			2.75% - 3.75%
Base Rate applicable margin	2.00% - 3.00%			1.75% - 2.75%
Commitment fees		0.50	%	0.375% - 0.500%

Interest on all outstanding Term SOFR Loans is payable on the last day of each interest period. Interest on all outstanding Base Rate Loans is payable on the first day of each calendar quarter.

Our Credit Facilities are secured by a first priority security interest in substantially all of our assets and the assets of our restricted subsidiaries, which are party to our Credit Facilities as guarantors.

Subject to certain exceptions and materiality qualifiers, our Credit Facilities include certain customary affirmative and negative covenants, which, among other things, restrict our ability and our restricted subsidiaries’ ability, subject to certain exceptions, to incur debt, grant liens, make restricted payments and investments, issue equity, sell or lease assets, dissolve or merge with another entity, enter into transactions with affiliates or restrictive agreements, change our business, prepay debt and amend our organizational documents and material agreements. Our Credit Facilities allow us to make cash restricted payments to our shareholders in accordance with the Company’s constituent documents, subject to the following conditions: (i) if the Company’s pro forma leverage ratio is less than 3.50 to 1.00 for the most recently ended four-fiscal quarter period, so long as (A) no default or event of default exists or would result from such restricted payment and (B) the Company’s pro forma liquidity is at least $10.0 million, and (ii) if the Company’s pro forma leverage ratio is greater than 3.50 to 1.00 for the most recently ended four-fiscal quarter period, so long as (A) no default or event of default exists or would result from such restricted payment, (B) the Company’s pro forma liquidity is at least $25.0 million, and (C) the Company’s Distributable Free Cash Flow Amount is greater than $0 after giving effect to such restricted payment. “Distributable Free Cash Flow Amount” is the lesser of the Company’s free cash flow for (x) the most recently ended four-fiscal quarter period and (y) the most recently ended two-fiscal quarter period, in each case minus the aggregate amount of certain restricted payments made during or after each such period.

In addition, we are required to comply with the following financial maintenance covenants: (i) a maximum leverage ratio as of the last day of each fiscal quarter of 4.00:1.00 for the period of the last four consecutive fiscal quarters (subject, in either case, to (x) a 0.50:1.00 leverage step-up for any “qualified acquisition” for the fiscal quarter in which such acquisition occurs and the immediately following two fiscal quarters, at the Company’s election, and (y) a cap of 0.50:1.00 on such step-up regardless of the total number of “qualified acquisitions” consummated during such fiscal quarters and certain other limitations set forth therein); and (ii) a minimum interest coverage ratio of at least 2.75 to 1.00 as of the last day of each fiscal quarter following the IPO.

Our Credit Facilities contain customary events of default, including for our failure and the failure of other loan parties to comply with the various financial, negative and affirmative covenants under our Credit Facilities (subject to the cure provisions set forth therein). During the existence of an event of default (as defined under our Credit Facilities), the agent, with the consent of or at the direction of the required lenders thereunder, has a right to, among other available remedies, terminate the commitments and/or declare all outstanding loans and accrued interest and fees under our Credit Facilities to be immediately due and payable.

The Company was in compliance with these covenants as of June 30, 2025.

The estimated fair value of our Credit Facilities approximates the principal amount outstanding because the interest rates applicable to such amounts are variable and reflective of market rates and the debt may be repaid, in full or in part, at any time without penalty.

Term Loan


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Debt issuance cost amortization	$	426		$	390		$	852		$	519
Interest expense incurred	$	6,750		$	4,970		$	13,517		$	6,892
Weighted average interest rate		7.65	%		8.42	%		7.69	%		8.43	%

Revolving Credit Facility


							June 30,			December 31,
							2025			2024
Total facility size							$	100,000		$	100,000
Less:
Outstanding balance								25,000			30,000
Letters of credit issued								-			-
Available commitment							$	75,000		$	70,000

Unamortized debt issuance costs							$	910		$	1,139

	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Debt issuance cost amortization	$	113		$	139		$	227		$	204
Interest expense incurred	$	538		$	1,063		$	1,027		$	1,850
Weighted average interest rate		7.68	%		8.41	%		7.74	%		8.43	%

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Name Accounting Standards Codification
-Section 50
-Paragraph 6
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

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+ Details

LandBridge Co LLC 10-Q