What happened to BCEI

[KCHenry8]

BCEI is down 28% today - would appreciate comments and suggestions to hold or sell

[setliff]

Bonanza Creek Energy Borrowing Base Cut in Half Resulting in $88 Mln Deficit; Shares Plummet 20%
MIDNIGHT TRADER 9:11 AM ET 5/24/2016

10:11 AM EDT, 05/24/2016 (MT Newswires) -- In an SEC filing on Monday, Bonanza Creek Energy(BCEI) said that as a result of a redetermination by lenders, its borrowing base has been cut to just $200 million from $475 million, with outstanding borrowings of $288 million, leaving the company $88 million overdrawn.

To rectify this deficiency, the company must do one of the following: (a) repay the deficiency within 30 days; (b) pledge additional oil and gas properties to its lenders that can be used to offset the deficiency; (c) pledge to repay the outstanding amount in six monthly installments; (d) or deliver written notice of the company's election to combine options (b) and (c) and indicate the amount to be repaid in installments and the amount to be provided as additional collateral.

As a result of this deficiency, shares of Bonanza Creek have fallen more than 20% to $2.50, near the lower end of its 52-week range of $0.88 to $21.99.

[setliff]

seems like a chicken shit thing for bank to do with wti recovering---

i think bcei will have a hell of a time surviving.

[dan_s]

May 5 Press Release: The Company has a $1.0 billion revolving credit facility, which was redetermined in October of 2015 with an approved borrowing base and commitment amount of $475 million. As of March 31, 2016, the Company had borrowings under its credit facility of $288.0 million, a letter of credit totaling $12.0 million, and cash totaling $218.6 million. Bonanza Creek has two outstanding issues of unsecured high-yield bonds which consist of $500 million of 6.75% senior notes due in 2021 and $300 million of 5.75% senior notes due in 2023. As of March 31, 2016, the Company was in compliance with all financial covenants, with a senior secured debt to TTM EBITDAX ratio of 1.3x, an interest coverage ratio of 3.9x, and a current ratio of 2.3x.

They just need to send the bank $88 million.

[dan_s]

Bankers are your best friends when you don't need the money. They are under a lot of pressure manage their energy loans. The credit facilities are asset based loans that are based on the year-end reserve reports.

[Fosterplc]

this is a going concern in an improving market, I'd sit tight.

[mkarpoff]

Dan, can they send the bank the 88 mil?

[dan_s]

Go to the 10-Q filed on May 5 and look at the Balance Sheet. It will answer your question.