Company: MGY
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001698990-25-000006
Chunk: 115

Company: Magnolia Oil & Gas Corp
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 115
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 The 2032 Senior Notes will mature on December 1, 2032 and bear interest at the rate of 6.875% per annum.The Company paid $7.6 million in fees to third parties which were recorded as deferred financing costs. Deferred financing costs are amortized using the effective interest method over the term of the 2032 Senior Notes and are included in “Interest expense, net” in the Company’s consolidated statements of operations. The unamortized portion of the deferred financing costs is included as a reduction to the carrying value of the 2032 Senior Notes, which has been recorded as “Long-term debt, net” on the Company’s consolidated balance sheet as of December 31, 2024.The Issuers used cash on hand and the proceeds from the issuance of the 2032 Senior Notes to redeem the 2026 Senior Notes. The Company recognized a loss on extinguishment of $8.8 million which is included within “Loss on extinguishment of debt” in the Company’s consolidated statements of operations.For the years ended December 31, 2024, 2023, and 2022, the Company recognized interest expense related to the 2032 Senior Notes and 2026 Senior Notes of $26.8 million, $26.5 million, and $26.3 million, respectively.At any time prior to December 1, 2027, the Issuers may, on any one or more occasions, redeem all or a part of the 2032 Senior Notes at a redemption price equal to 100% of the principal amount of the 2032 Senior Notes redeemed, plus a “make whole” premium on accrued and unpaid interest, if any, to, but excluding, the date of redemption. After December 1, 2027, the Issuers may redeem all or a part of the 2032 Senior Notes based on principal plus a set premium, as set forth in the Indenture, including any accrued and unpaid interest.

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8. Leases

Magnolia’s leases primarily consist of real estate, vehicles, and field equipment. The Company’s leases have remaining lease terms of up to four years, some of which include options to renew or terminate the lease. The exercise of lease renewal options is at the Company’s sole discretion. Magnolia’s lease agreements do not contain any restrictive covenants or material residual value guarantees.As most of Magnolia’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available