UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): December 21, 2009 (December 15,
2009)
TETON
ENERGY CORPORATION
(Exact
name of registrant as specified in its charter)
Delaware
|
001-31679
|
84-1482290
|
||
(State
or other jurisdiction
of
incorporation)
|
(Commission
File Number)
|
(IRS
Employer Identification
No.)
|
600
17th Street, Suite 1600 North
Denver,
CO
|
80202
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Registrant’s
telephone number, including area code: (303) 565-4600
N/A
(Former
name or former address, if changed since last report.)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
|
INFORMATION
ABOUT FORWARD-LOOKING STATEMENTS
This
Current Report on Form 8-K of Teton Energy Corporation (“Teton,” the “Company,”
“we,” “us” or “our”), and the documents incorporated herein by reference,
contain both historical and “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended. Forward-looking statements,
written, oral or otherwise made, represent the Company’s expectation or belief
concerning future events. All statements, other than statements of historical
fact, are or may be forward-looking statements. For example, statements
concerning projections, predictions, expectations, estimates or forecasts, and
statements that describe our objectives, future performance, plans or goals are,
or may be, forward-looking statements. These forward-looking statements reflect
management’s current expectations concerning future results and events and can
generally be identified by the use of words such as “may,” “will,” “should,”
“could,” “would,” “likely,” “predict,” “potential,” “continue,” “future,”
“estimate,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” and
other similar words or phrases, as well as statements in the future
tense.
Forward-looking
statements involve known and unknown risks, uncertainties, assumptions, and
other important factors that may cause our actual results, performance, or
achievements to be different from any future results, performance and
achievements expressed or implied by these statements. The following important
risks and uncertainties could affect our future results, causing those results
to differ materially from those expressed in our forward-looking
statements:
·
|
our
inability to continue business operations during the Chapter 11
proceeding;
|
·
|
our
ability to obtain court approval of our plan of reorganization and various
other motions we have filed and expect to file as part of the Chapter 11
proceeding;
|
·
|
our
ability to consummate our plan of reorganization as currently
planned;
|
·
|
risks
associated with third party motions in the Chapter 11 proceeding, which
may interfere with our reorganization as currently
planned;
|
·
|
our
ability to close the Plan Sponsorship
Agreement;
|
·
|
the
potential adverse effects of the Chapter 11 proceeding on our liquidity
and results of operations;
|
·
|
our
ability to retain and motivate key executives and other necessary
personnel while seeking to implement our plan of
reorganization;
|
·
|
General
economic and political conditions, including governmental energy policies,
tax rates or policies, inflation rates and constrained credit
markets;
|
·
|
The
market price of, and supply/demand balance for, oil and natural
gas;
|
·
|
Our
success in completing development and exploration activities, when and if
we are able to resume those
activities;
|
·
|
Expansion
and other development trends of the oil and gas
industry;
|
·
|
Acquisitions
and other business opportunities that may be presented to and pursued by
us;
|
·
|
Our
ability to integrate our acquisitions into our company structure;
and
|
·
|
Changes
in laws and regulations.
|
These
factors are not necessarily all of the important factors that could cause actual
results to differ materially from those expressed in any of our forward-looking
statements. Other factors, including unknown or unpredictable ones could also
have material adverse effects on our future results.
The
forward-looking statements included in this Current Report are made only as of
the date set forth on the front of the document. We expressly disclaim any
intent or obligation to update any forward-looking statements to reflect new
information, subsequent events, changed circumstances, or
otherwise.
On
December 15, 2009, Teton Energy Corporation, a Delaware corporation, and its
subsidiaries (collectively, “Teton”), conducted a bankruptcy auction for the
sale of Teton and/or substantially all of its assets, pursuant to the Order (I)
Approving Bidding Procedures for the Transfer of Substantially All of the
Debtors’ Assets Through a Chapter 11 Plan of Reorganization, (II) Approving
Certain Bidding Protections, and (III) Scheduling an Auction, entered by the
Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). At the
conclusion of the auction, Caerus Oil and Gas LLC, a Delaware limited liability
company (“Caerus”) was selected as the prevailing bidder. There are
no relationships between Teton or its affiliates and Caerus, other than with
respect to the auction.
As
previously disclosed, in connection with the filing by Teton of voluntary
petitions for reorganization proceedings under Chapter 11 of the United States
Code, in the Bankruptcy Court on November 8, 2009 (Case No. 09-13946 et seq.), Teton established
an auction process to effect the sale of Teton and/or its assets. As
a result of the auction held on December 15, 2009, Teton and Caerus will enter
into a plan sponsorship agreement (the “Caerus Plan Sponsorship Agreement”) to
be effective as of December 15, 2009. A copy of the Caerus Plan
Sponsorship Agreement will be filed with the Securities and Exchange Commission
when it becomes available. Except as set forth below, the Caerus Plan
Sponsorship Agreement is expected to contain substantially the same terms as the
previously reported plan sponsorship agreement (the “Rise Plan Sponsorship
Agreement”) with Rise Energy Partners II, LLC, a Delaware limited liability
company (“Rise”), pursuant to which, subject to higher and better offers at
auction, Rise had agreed to fund Teton’s emergence from reorganization, all
existing equity interests in Teton would have been cancelled, and Teton’s
organizational form would have been converted from a Delaware corporation to a
Delaware limited liability company.
Pursuant
to the Caerus Plan Sponsorship Agreement, Caerus will acquire one hundred
percent (100%) of the membership interests of the reorganized Teton with Teton’s
assets re-vesting in the reorganized Teton free and clear of all liens, claims
and encumbrances that are not enumerated in Teton’s Plan of
Reorganization. The consideration will be comprised of (i)
$20,050,000 in cash (subject to post-closing working capital adjustments), and
(ii) a contractual participation right to 50% of the profits (net of the payment
of Caerus’ expenses) relating to certain assets of Teton, which assets will be
transferred into one or more special purpose entities to be wholly owned by
Caerus. The proceeds of the sale to Caerus will be distributed in
accordance with Teton’s Plan of Reorganization, which was filed with the
Bankruptcy Court. Caerus has the option of converting the transaction
to an asset purchase arrangement with no change in effect to the creditors or
interest holders.
Pursuant
to the terms of the Rise Plan Sponsorship Agreement, because the purchase and
sale of Teton’s assets will not be consummated with Rise, Rise is entitled to a
break-up fee of $750,000 and the reimbursement of Rise’s actual out-of-pocket
and reasonable third-party costs and expenses in an amount not to exceed
$200,000.
Consummation
of the transaction with Caerus is subject to approval and confirmation by the
Bankruptcy Court. The confirmation hearing has been scheduled for
January 8, 2010.
The
foregoing summary of the Caerus Plan Sponsorship Agreement is qualified in its
entirety by reference to the definitive transaction document(s), a copy of which
will be filed with the Securities and Exchange Commission when it becomes
available.
Item
7.01 Regulation
FD Disclosure
Additional
information about Teton’s reorganization, including access to Bankruptcy Court
documents and other general information about the Chapter 11 cases, is available
at http://tetonenergyreorganization.com/.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Dated:
December 21, 2009
TETON
ENERGY CORPORATION
|
||||
By:
|
/s/
Jonathan Bloomfield
|
|||
Jonathan
Bloomfield
|
||||
Executive
Vice President and Chief Financial Officer
|