Yep and that covenant .... keep G&A to $3M or less a yr ... so...

Yep and that covenant .... keep G&A to $3M or less a yr ... so $750K/Qtr .... is one which it totally under TB's control. Not dependent on oil price, water production and thus overall LOE cost. It's a simple one. And yet even after multiple Qtrs, TB cannot get this in compliance.

The increase (or decrease) in credit facility is Reserves Dependent and PDP Reserves went down.

MOB is very patient with them. Every $1 above $750K is $0.50 of their money that is supposed to be repaid under the monthly cash flow sweep put in place. Peer group wise $16.57/BOE (and its now mostly oil at 97% of production) for G&A is just not going to impress any future lender.

The annualized Debt to EBITDAX is 5.75x and with $24M debt (inc OAS) means annualized EBITDAX has to be about $4.17M and I'm barely getting close to about $2.5M (annualized using last 6 mths of ops). That's a red flag for me as is the fact that SSN still does not put out the adjusted EBITDAX reconciliation (lazy or being opaque).

Just like their commentary on the effect current pricing has on debt, is the equally cautionary statement with respect to production and their liquidity:

"If future production rates are less than anticipated, and/or the oil price continues to deteriorate for an extended period, the value of our position in affected areas will decline, our results of operations, financial condition and liquidity will be adversely impacted and we could incur material write-downs of oil and gas properties."

Be aware. The comments are there for good reason. A "material" write-down to Reserves (as in either the volume is lowered because the production improvements are not achieved and the PDNP isn't as much or the price goes further down .... watch strip and hedging) may be "terminal" IF they do not have their balance sheet in order before then. It is all in the financial statements.

I think the "market" was expecting much better than this IMO.