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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 ________________________________________________________ 
FORM 10-Q
 _________________________________________________________  
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to            
Commission File Number 001-35410
 _________________________________________________________  
Matador Resources Company
(Exact name of registrant as specified in its charter)
  _________________________________________________________ 
Texas27-4662601
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
5400 LBJ Freeway, Suite 1500
Dallas, Texas
75240
(Address of principal executive offices)(Zip Code)
(972) 371-5200
(Registrant’s telephone number, including area code)
 _________________________________________________________  
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareMTDRNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.       Yes      No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).      Yes      No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      Yes      No
As of July 27, 2021, there were 116,982,758 shares of the registrant’s common stock, par value $0.01 per share, outstanding.


Table of Contents
MATADOR RESOURCES COMPANY
FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 2021
TABLE OF CONTENTS
 Page


Table of Contents
Part I — FINANCIAL INFORMATION
Item 1. Financial Statements — Unaudited
Matador Resources Company and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS — UNAUDITED
(In thousands, except par value and share data)
June 30,
2021
December 31,
2020
ASSETS
Current assets
Cash$44,632 $57,916 
Restricted cash34,576 33,467 
Accounts receivable
Oil and natural gas revenues154,077 85,098 
Joint interest billings42,130 34,823 
Other19,826 17,212 
Derivative instruments6,171 6,727 
Lease and well equipment inventory11,657 10,584 
Prepaid expenses and other current assets20,559 15,802 
Total current assets333,628 261,629 
Property and equipment, at cost
Oil and natural gas properties, full-cost method
Evaluated5,514,224 5,295,931 
Unproved and unevaluated926,492 902,133 
Midstream properties859,189 841,695 
Other property and equipment29,983 29,561 
Less accumulated depletion, depreciation and amortization(3,867,858)(3,701,551)
Net property and equipment3,462,030 3,367,769 
Other assets
Derivative instruments2,424 2,570 
Other long-term assets 36,467 55,312 
Total assets$3,834,549 $3,687,280 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable$13,573 $13,982 
Accrued liabilities151,051 119,158 
Royalties payable82,256 66,049 
Amounts due to affiliates15,823 4,934 
Derivative instruments127,687 45,186 
Advances from joint interest owners6,208 4,191 
Other current liabilities25,982 37,436 
Total current liabilities422,580 290,936 
Long-term liabilities
Borrowings under Credit Agreement240,000 440,000 
Borrowings under San Mateo Credit Facility352,500 334,000 
Senior unsecured notes payable1,041,789 1,040,998 
Asset retirement obligations39,737 37,919 
Derivative instruments3,024  
Deferred income taxes7,847  
Other long-term liabilities24,946 30,402 
Total long-term liabilities1,709,843 1,883,319 
Commitments and contingencies (Note 9)
Shareholders’ equity
Common stock - $0.01 par value, 160,000,000 shares authorized; 117,123,379 and 116,847,003 shares issued; and 116,992,831 and 116,844,768 shares outstanding, respectively
1,171 1,169 
Additional paid-in capital2,061,815 2,027,069 
Accumulated deficit(580,981)(741,705)
Treasury stock, at cost, 130,548 and 2,235 shares, respectively
(2,243)(3)
Total Matador Resources Company shareholders’ equity1,479,762 1,286,530 
Non-controlling interest in subsidiaries222,364 226,495 
Total shareholders’ equity1,702,126 1,513,025 
Total liabilities and shareholders’ equity$3,834,549 $3,687,280 




The accompanying notes are an integral part of these financial statements.
3

Table of Contents

Matador Resources Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS — UNAUDITED
(In thousands, except per share data)
 Three Months Ended
June 30,
Six Months Ended
June 30,
 2021202020212020
Revenues
Oil and natural gas revenues$412,074 $118,767 $728,307 $316,681 
Third-party midstream services revenues19,850 14,668 35,288 30,498 
Sales of purchased natural gas10,918 13,981 15,428 24,525 
Lease bonus - mineral acreage 4,062  4,062 
Realized (loss) gain on derivatives(42,611)44,110 (68,524)54,977 
Unrealized (loss) gain on derivatives(42,804)(132,668)(86,227)3,762 
Total revenues357,427 62,920 624,272 434,505 
Expenses
Production taxes, transportation and processing43,843 18,797 78,017 40,513 
Lease operating28,752 26,162 54,691 57,072 
Plant and other midstream services operating13,746 9,780 27,409 19,744 
Purchased natural gas9,628 10,922 12,483 18,980 
Depletion, depreciation and amortization91,444 93,350 166,307 184,057 
Accretion of asset retirement obligations511 495 1,011 971 
Full-cost ceiling impairment  324,001  324,001 
General and administrative24,397 14,723 46,585 30,945 
Total expenses212,321 498,230 386,503 676,283 
Operating income (loss)145,106 (435,310)237,769 (241,778)
Other income (expense)
Net loss on asset sales and impairment (2,632) (2,632)
Interest expense(17,940)(18,297)(37,590)(38,109)
Other income (expense)14 473 (661)1,793 
Total other expense(17,926)(20,456)(38,251)(38,948)
Income (loss) before income taxes127,180 (455,766)199,518 (280,726)
Income tax provision (benefit)
Deferred5,349 (109,823)8,189 (69,866)
Income tax provision (benefit)5,349 (109,823)8,189 (69,866)
Net income (loss)121,831 (345,943)191,329 (210,860)
Net income attributable to non-controlling interest in subsidiaries(15,926)(7,473)(24,779)(16,827)
Net income (loss) attributable to Matador Resources Company shareholders$105,905 $(353,416)$166,550 $(227,687)
Earnings (loss) per common share
Basic$0.91 $(3.04)$1.43 $(1.96)
Diluted$0.89 $(3.04)$1.40 $(1.96)
Weighted average common shares outstanding
Basic116,801 116,071 116,804 115,977 
Diluted118,993 116,071 118,617 115,977 
The accompanying notes are an integral part of these financial statements.
4

Table of Contents
Matador Resources Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY — UNAUDITED
(In thousands)
For the Three and Six Months Ended June 30, 2021
Total shareholders’ equity attributable to Matador Resources Company
Non-controlling interest in subsidiariesTotal shareholders’ equity
 Common StockAdditional
paid-in capital
Accumulated deficitTreasury Stock
 SharesAmountSharesAmount
Balance at January 1, 2021116,847 $1,169 $2,027,069 $(741,705)2 $(3)$1,286,530 $226,495 $1,513,025 
Dividends declared ($0.025 per share)
— — — (2,913)— — (2,913)— (2,913)
Issuance of common stock pursuant to employee stock compensation plan3 — — — — — — —  
Issuance of common stock pursuant to directors’ and advisors’
compensation plan
9 — — — — — — —  
Stock-based compensation expense related to equity-based awards including amounts capitalized— — 1,477 — — — 1,477 — 1,477 
Stock options exercised, net of options forfeited in net share settlements13 — — — — — — —  
Restricted stock forfeited— — (219)— 90 (1,501)(1,720)— (1,720)
Contribution related to formation of San Mateo (see Note 6)— — 15,376 — — — 15,376 — 15,376 
Distributions to non-controlling interest owners of less-than-wholly-owned subsidiaries— — — — — — — (14,210)(14,210)
Current period net income— — — 60,645 — — 60,645 8,853 69,498 
Balance at March 31, 2021116,872 1,169 2,043,703 (683,973)92 (1,504)1,359,395 221,138 1,580,533 
Dividends declared ($0.025 per share)
— — — (2,913)— — (2,913)— (2,913)
Issuance of common stock pursuant to employee stock compensation plan138 1 (1)— — — — —  
Issuance of common stock pursuant to directors’ and advisors’
compensation plan
73 1 (1)— — — — —  
Stock-based compensation expense related to equity-based awards including amounts capitalized— — 2,289 — — — 2,289 — 2,289 
Stock options exercised, net of options forfeited in net share settlements40 — — — — — — —  
Restricted stock forfeited— — (425)— 38 (739)(1,164)— (1,164)
Contribution related to formation of San Mateo (see Note 6)— — 16,250 — — — 16,250 — 16,250 
Distributions to non-controlling interest owners of less-than-wholly-owned subsidiaries— — — — — — — (14,700)(14,700)
Current period net income— — — 105,905 — — 105,905 15,926 121,831 
Balance at June 30, 2021117,123 $1,171 $2,061,815 $(580,981)130 $(2,243)$1,479,762 $222,364 $1,702,126 




The accompanying notes are an integral part of these financial statements.
5

Table of Contents

Matador Resources Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY — UNAUDITED
(In thousands)
For the Three and Six Months Ended June 30, 2020
Total shareholders’ equity attributable to Matador Resources Company
Non-controlling interest in subsidiariesTotal shareholders’ equity
 Common StockAdditional
paid-in capital
Accumulated deficitTreasury Stock
 SharesAmountSharesAmount
Balance at January 1, 2020116,644 $1,166 $1,981,014 $(148,500)1 $(26)$1,833,654 $135,798 $1,969,452 
Issuance of common stock pursuant to employee stock compensation plan3 — — — — — — —  
Issuance of common stock pursuant to directors’ and advisors’
compensation plan
2 — — — — — — —  
Stock-based compensation expense related to equity-based awards including amounts capitalized— — 5,066 — — — 5,066 — 5,066 
Stock options exercised, net of options forfeited in net share settlements— — (24)— — — (24)— (24)
Liability-based stock option awards settled in equity22 1 297 — — — 298 — 298 
Restricted stock forfeited— — — — 106 (1,267)(1,267)— (1,267)
Contribution related to formation of San Mateo, net of tax of $3.1 million (see Note 6)
— — 11,613 — — — 11,613 — 11,613 
Contributions from non-controlling interest owners of less-than-wholly-owned subsidiaries, net of tax of $4.3 million (see Note 6)
— — 16,280 — — — 16,280 29,394 45,674 
Distributions to non-controlling interest owners of less-than-wholly-owned subsidiaries— — — — — — — (11,515)(11,515)
Current period net income— — — 125,729 — — 125,729 9,354 135,083 
Balance at March 31, 2020116,671 1,167 2,014,246 (22,771)107 (1,293)1,991,349 163,031 2,154,380 
Issuance of common stock pursuant to employee stock compensation plan230 2 (2)— — — — —  
Issuance of common stock pursuant to directors’ and advisors’ compensation plan83 1 (1)— — — — —  
Stock-based compensation expense related to equity-based awards including amounts capitalized— — 4,103 — — — 4,103 — 4,103 
Restricted stock forfeited— — — — 33 (156)(156)— (156)
Contributions from non-controlling interest owners of less-than-wholly-owned subsidiaries, net of tax of $0.5 million (see Note 6)
— — 1,952 — — — 1,952 14,700 16,652 
Distributions to non-controlling interest owners of less-than-wholly-owned subsidiaries— — — — — — — (10,535)(10,535)
Current period net (loss) income— — — (353,416)— — (353,416)7,473 (345,943)
Balance at June 30, 2020116,984 $1,170 $2,020,298 $(376,187)140 $(1,449)$1,643,832 $174,669 $1,818,501 

The accompanying notes are an integral part of these financial statements.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED
(In thousands)
 Six Months Ended
June 30,
 20212020
Operating activities
Net income (loss)$191,329 $(210,860)
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Unrealized loss (gain) on derivatives86,227 (3,762)
Depletion, depreciation and amortization166,307 184,057 
Accretion of asset retirement obligations1,011 971 
Full-cost ceiling impairment 324,001 
Stock-based compensation expense2,650 7,080 
Deferred income tax provision (benefit)8,189 (69,866)
Amortization of debt issuance cost1,655 1,399 
Net loss on asset sales and impairment 2,632 
Changes in operating assets and liabilities
Accounts receivable(78,900)46,628 
Lease and well equipment inventory(437)(868)
Prepaid expenses and other current assets(4,483)(1,610)
Other long-term assets91 1,806 
Accounts payable, accrued liabilities and other current liabilities34,345 (52,351)
Royalties payable16,207 (24,198)
Advances from joint interest owners2,017 5,094 
Other long-term liabilities1,387 232 
Net cash provided by operating activities427,595 210,385 
Investing activities
Drilling, completion and equipping capital expenditures(210,725)(283,362)
Acquisition of oil and natural gas properties(15,356)(51,736)
Midstream capital expenditures(25,092)(123,338)
Expenditures for other property and equipment(245)(1,381)
Proceeds from sale of assets296 1,056 
Net cash used in investing activities(251,122)(458,761)
Financing activities
Repayments of borrowings under Credit Agreement(240,000) 
Borrowings under Credit Agreement40,000 130,000 
Repayments of borrowings under San Mateo Credit Facility(34,000) 
Borrowings under San Mateo Credit Facility52,500 32,000 
Cost to amend credit facilities(830)(660)
Dividends paid(5,826) 
Contributions related to formation of San Mateo31,626 14,700 
Contributions from non-controlling interest owners of less-than-wholly-owned subsidiaries 67,172 
Distributions to non-controlling interest owners of less-than-wholly-owned subsidiaries(28,910)(22,050)
Taxes paid related to net share settlement of stock-based compensation(2,884)(1,493)
Other(324)7,087 
Net cash (used in) provided by financing activities(188,648)226,756 
Decrease in cash and restricted cash(12,175)(21,620)
Cash and restricted cash at beginning of period91,383 65,128 
Cash and restricted cash at end of period$79,208 $43,508 
Supplemental disclosures of cash flow information (Note 10)

The accompanying notes are an integral part of these financial statements.
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Matador Resources Company and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —
UNAUDITED
NOTE 1 — NATURE OF OPERATIONS
Matador Resources Company, a Texas corporation (“Matador” and, collectively with its subsidiaries, the “Company”), is an independent energy company engaged in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. The Company’s current operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The Company also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana. Additionally, the Company conducts midstream operations, primarily through its midstream joint venture, San Mateo Midstream, LLC (collectively with its subsidiaries, “San Mateo”), in support of the Company’s exploration, development and production operations and provides natural gas processing, oil transportation services, oil, natural gas and produced water gathering services and produced water disposal services to third parties.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Interim Financial Statements, Basis of Presentation, Consolidation and Significant Estimates
The interim unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) but do not include all of the information and footnotes required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 26, 2021 (the “Annual Report”). The Company consolidates certain subsidiaries and joint ventures that are less than wholly-owned and are not involved in oil and natural gas exploration, including San Mateo, and the net income and equity attributable to the non-controlling interest in these subsidiaries have been reported separately as required by Accounting Standards Codification, Consolidation (Topic 810). The Company proportionately consolidates certain joint ventures that are less than wholly-owned and are involved in oil and natural gas exploration. All intercompany accounts and transactions have been eliminated in consolidation. In management’s opinion, these interim unaudited condensed consolidated financial statements include all normal, recurring adjustments that are necessary for a fair presentation of the Company’s interim unaudited condensed consolidated financial statements as of June 30, 2021. Amounts as of December 31, 2020 are derived from the Company’s audited consolidated financial statements included in the Annual Report.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions may also affect disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company’s interim unaudited condensed consolidated financial statements are based on a number of significant estimates, including oil and natural gas revenues, accrued assets and liabilities, stock-based compensation, valuation of derivative instruments, deferred tax assets and liabilities and oil and natural gas reserves. The estimates of oil and natural gas reserves quantities and future net cash flows are the basis for the calculations of depletion and impairment of oil and natural gas properties, as well as estimates of asset retirement obligations and certain tax accruals. While the Company believes its estimates are reasonable, changes in facts and assumptions or the discovery of new information may result in revised estimates. Actual results could differ from these estimates.
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Matador Resources Company and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —
UNAUDITED — CONTINUED

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued
Revenues
The following table summarizes the Company’s total revenues and revenues from contracts with customers on a disaggregated basis for the three and six months ended June 30, 2021 and 2020 (in thousands).
Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Revenues from contracts with customers$442,842 $147,416 $779,023 $371,704 
Lease bonus - mineral acreage 4,062  4,062 
Realized (loss) gain on derivatives(42,611)44,110 (68,524)54,977 
Unrealized (loss) gain on derivatives(42,804)(132,668)(86,227)3,762 
Total revenues$357,427 $62,920 $624,272 $434,505 
Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Oil revenues$315,114 $94,174 $528,393 $263,759 
Natural gas revenues96,960 24,593 199,914 52,922 
Third-party midstream services revenues19,850 14,668 35,288 30,498 
Sales of purchased natural gas10,918 13,981 15,428 24,525 
Total revenues from contracts with customers$442,842 $147,416 $779,023 $371,704 

Property and Equipment
The Company uses the full-cost method of accounting for its investments in oil and natural gas properties. Under this method, the Company is required to perform a ceiling test each quarter that determines a limit, or ceiling, on the capitalized costs of oil and natural gas properties based primarily on the after-tax estimated future net cash flows from oil and natural gas properties using a 10% discount rate and the arithmetic average of first-day-of-the-month oil and natural gas prices for the prior 12-month period. For the three and six months ended June 30, 2021, the cost center ceiling was higher than the capitalized costs of oil and natural gas properties, and, as a result, no impairment charge was necessary. At June 30, 2020, the Company’s net capitalized costs less related deferred income taxes exceeded the full-cost ceiling by $243.9 million. As a result, the Company recorded an impairment charge of $324.0 million to its net capitalized costs and a deferred income tax benefit of $80.1 million at June 30, 2020. These charges are reflected in the Company’s interim condensed consolidated statements of operations for the three and six months ended June 30, 2020.
The Company capitalized approximately $9.2 million and $8.1 million of its general and administrative costs and approximately $1.9 million and $1.8 million of its interest expense for the three months ended June 30, 2021 and 2020, respectively. The Company capitalized approximately $18.7 million and $16.3 million of its general and administrative costs and approximately $2.5 million and $3.2 million of its interest expense for the six months ended June 30, 2021 and 2020, respectively.
Earnings Per Common Share
The Company reports basic earnings attributable to Matador shareholders per common share, which excludes the effect of potentially dilutive securities, and diluted earnings attributable to Matador shareholders per common share, which includes the effect of all potentially dilutive securities unless their impact is anti-dilutive.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —
UNAUDITED — CONTINUED

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued
The following table sets forth the computation of diluted weighted average common shares outstanding for the three and six months ended June 30, 2021 and 2020 (in thousands).
 Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Weighted average common shares outstanding
Basic116,801 116,071 116,804 115,977 
Dilutive effect of options and restricted stock units2,192  1,813  
Diluted weighted average common shares outstanding 118,993 116,071 118,617 115,977 
A total of 0.5 million and 1.5 million options to purchase shares of Matador’s common stock were excluded from the diluted weighted average common shares outstanding for the three and six months ended June 30, 2021, respectively, because their effects were anti-dilutive. A total of 2.5 million and 2.6 million options to purchase shares of Matador’s common stock were excluded from the diluted weighted average common shares outstanding for the three and six months ended June 30, 2020, respectively, because their effects were anti-dilutive. Additionally, 0.5 million and 0.6 million restricted shares, which are participating securities, were excluded from the calculations above for the three and six months ended June 30, 2020, respectively, as the security holders do not have the obligation to share in the losses of the Company.
NOTE 3 — ASSET RETIREMENT OBLIGATIONS
The following table summarizes the changes in the Company’s asset retirement obligations for the six months ended June 30, 2021 (in thousands).
Beginning asset retirement obligations$38,542 
Liabilities incurred during period635 
Liabilities settled during period(240)
Accretion expense1,011 
Ending asset retirement obligations39,948 
Less: current asset retirement obligations(1)
(211)
Long-term asset retirement obligations$39,737 
 _______________
(1)Included in accrued liabilities in the Company’s interim unaudited condensed consolidated balance sheet at June 30, 2021.
NOTE 4 — DEBT
At June 30, 2021, the Company had (i) $1.05 billion of outstanding senior notes due 2026 (the “Notes”), (ii) $240.0 million in borrowings outstanding under its reserves-based revolving credit facility (the “Credit Agreement”), (iii) approximately $45.8 million in outstanding letters of credit issued pursuant to the Credit Agreement and (iv) $7.5 million outstanding under an unsecured U.S. Small Business Administration loan.
At June 30, 2021, San Mateo had $352.5 million in borrowings outstanding under its revolving credit facility (the “San Mateo Credit Facility”) and approximately $9.0 million in outstanding letters of credit issued pursuant to the San Mateo Credit Facility. Between June 30, 2021 and July 27, 2021, San Mateo repaid $25.0 million of borrowings under the San Mateo Credit Facility.
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Matador Resources Company and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —
UNAUDITED — CONTINUED

NOTE 4 — DEBT — Continued
Credit Agreements
MRC Energy Company
The borrowing base under the Credit Agreement is determined semi-annually as of May 1 and November 1 by the lenders based primarily on the estimated value of the Company’s proved oil and natural gas reserves at December 31 and June 30 of each year, respectively. The Company and the lenders may each request an unscheduled redetermination of the borrowing base once between scheduled redetermination dates. In April 2021, the lenders completed their review of the Company’s proved oil and natural gas reserves, and, as a result, the borrowing base was reaffirmed at $900.0 million. The Company elected to keep the borrowing commitment at $700.0 million, the maximum facility amount remained $1.5 billion and no material changes were made to the terms of the Credit Agreement. This April 2021 redetermination constituted the regularly scheduled May 1 redetermination. Borrowings under the Credit Agreement are limited to the lowest of the borrowing base, the maximum facility amount and the elected commitment (subject to compliance with the covenant noted below). The Credit Agreement matures October 31, 2023.
The Credit Agreement requires the Company to maintain a debt to EBITDA ratio, which is defined as debt outstanding (net of up to $50.0 million of cash or cash equivalents), divided by a rolling four quarter EBITDA calculation, of 4.0 or less. The Company believes that it was in compliance with the terms of the Credit Agreement at June 30, 2021.
San Mateo Midstream, LLC
The San Mateo Credit Facility is non-recourse with respect to Matador and its wholly-owned subsidiaries but is guaranteed by San Mateo’s subsidiaries and secured by substantially all of San Mateo’s assets, including real property. The San Mateo Credit Facility matures December 19, 2023 and was amended in June 2021 to increase the lender commitments under the revolving credit facility from $375.0 million to $450.0 million (subject to San Mateo’s compliance with the covenants noted below) and to increase the borrowing rate for a base rate loan or a Eurodollar loan under such facility by 0.50%. The San Mateo Credit Facility includes an accordion feature, which, after the aforementioned amendment, provides for potential increases in lender commitments to up to $700.0 million.
The San Mateo Credit Facility requires San Mateo to maintain a debt to EBITDA ratio, which is defined as total consolidated funded indebtedness outstanding (as defined in the San Mateo Credit Facility) divided by a rolling four quarter EBITDA calculation, of 5.0 or less, subject to certain exceptions. The San Mateo Credit Facility also requires San Mateo to maintain an interest coverage ratio, which is defined as a rolling four quarter EBITDA calculation divided by San Mateo’s consolidated interest expense, of 2.5 or more. The San Mateo Credit Facility also restricts the ability of San Mateo to distribute cash to its members if San Mateo’s liquidity is less than 10% of the lender commitments under the San Mateo Credit Facility. The Company believes that San Mateo was in compliance with the terms of the San Mateo Credit Facility at June 30, 2021.
Senior Unsecured Notes
At June 30, 2021, the Company had $1.05 billion of outstanding Notes, which have a 5.875% coupon rate. The Notes mature September 15, 2026, and interest is payable on the Notes semi-annually in arrears on each March 15 and September 15. The Notes are guaranteed on a senior unsecured basis by certain subsidiaries of the Company.
NOTE 5 — INCOME TAXES
The Company recorded an income tax provision of $5.3 million and $8.2 million for the three and six months ended June 30, 2021, respectively, which resulted in an effective tax rate of 5% in each period. The effective tax rate differed from amounts computed by applying the U.S. federal statutory rate to the pre-tax income due primarily to recording a net deferred tax liability for state taxes, primarily in New Mexico, and continuing to recognize a valuation allowance against its U.S. federal net deferred tax assets. As a result of the full-cost ceiling impairments recorded in 2020, the Company recognized a valuation allowance against its net deferred tax assets for the year ended December 31, 2020. The valuation allowance will continue to be recognized until the future deferred tax benefits are more likely than not to become utilized.
The Company’s effective tax rates for the three and six months ended June 30, 2020 were 24% and 23%, respectively. The Company’s total income tax provision for the three and six months ended June 30, 2020 differed from amounts computed by applying the U.S. federal statutory tax rates to pre-tax income due to the impact of permanent differences between book and tax income, as well as state taxes, primarily in New Mexico.

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Matador Resources Company and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —
UNAUDITED — CONTINUED

NOTE 6 — EQUITY
Common Stock Dividend
The Company’s Board of Directors (the “Board”) declared a quarterly cash dividend of $0.025 per share of common stock in both the first and second quarters of 2021. The dividend, which totaled $2.9 million in each quarter, was paid on March 31, 2021 and June 3, 2021. In July 2021, the Board declared a quarterly cash dividend of $0.025 per share of common stock payable on September 3, 2021 to shareholders of record as of August 12, 2021.
San Mateo Distributions and Contributions
During the three months ended June 30, 2021 and 2020, San Mateo distributed $15.3 million and $11.0 million, respectively, to the Company and $