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: October 9, 2018
(Date of earliest event reported)
Yuma Energy, Inc.
(Exact name of registrant as specified in its charter)
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DELAWARE
(State or other jurisdiction
of incorporation)
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001-37932
(Commission File Number)
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94-0787340
(IRS Employer Identification No.)
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1177 West Loop South, Suite 1825
Houston, Texas 77027
(Address of principal executive offices) (Zip Code)
(713) 968-7000
(Registrant’s telephone number, including area
code)
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(Former name or former address, if changed since last
report)
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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:
☐ Written
communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
☐ Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
☐ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
☐ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).
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.
☐
Item 2.04.
Triggering Events That Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet
Arrangement.
On
October 9, 2018, Yuma Energy, Inc. (the “Company”)
received a notice of event of default under the credit agreement
and reservation of rights (the “Notice”) from the
Société Générale, as Administrative Agent and
Issuing Bank (the “Administrative Agent”), under the
Credit Agreement dated October 26, 2016 and as amended on May 19,
2017, May 8, 2018 and July 31, 2018 (the “Credit
Agreement”) among the Company and certain of its subsidiaries
(collectively, the “Borrowers”), the Administrative
Agent, and the lenders and guarantors party thereto, advising that
an event of default has occurred and continues to exist under
Section 6.1(d) of the Credit Agreement by reason of the
Company’s noncompliance with the liquidity covenant requiring
the Company to maintain cash and cash equivalents of at least $4.0
million. As a result of the default, the lenders may accelerate the
$35.0 million outstanding balance under the Credit Agreement and
the lenders thereunder may increase the applicable interest rate
under the Credit Agreement by 2.0% per annum. As of the date of
this report, the lenders have neither accelerated the outstanding
amount nor increased the applicable interest but may do so in the
future.
The
Notice advises the Company that the Administrative Agent retains
and expressly reserves all rights and remedies to which it or any
lender may be entitled under the Credit Agreement, including the
right to accelerate and declare the loans under the Credit
Agreement to be due and payable and to foreclose on the collateral
subject to the Credit Agreement.
The
Notice further advises the Company that (i) none of the
Administrative Agent or the lenders has waived, intends to waive,
or does waive any event of default, or any other current or future
default or event of default that may now or hereafter exist, (ii)
any forbearance from the exercise of any rights and other remedies
by the Administrative Agent or the lenders under the Credit
Agreement with respect to any of the events of default are not to
be construed as a waiver thereof and the Administrative Agent and
the lenders reserved their rights to invoke all such rights and
remedies at any time the Administrative Agent and the lenders deem
appropriate in respect thereof, in accordance with the Credit
Agreement and without further notice, (iii) the Administrative
Agent and the lenders reserve the right to identify and assert
additional events of default that may now exist or hereafter arise,
and (iv) nothing in the Notice constitutes or be deemed to
constitute, a modification of, or waiver under the Credit
Agreement, or the acceptance of an event of default, occurrence or
circumstance that may constitute an event of default under the
Credit Agreement.
The
Company intends to commence discussions with the lenders under the
Credit Agreement concerning a forbearance agreement or waiver of
the event of default; however, there can be no assurance that the
Company and the lenders will come to any agreement (either oral or
written) regarding a forbearance or waiver of the event of
default.
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.
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YUMA
ENERGY, INC.
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Date: October 12,
2018
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By:
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/s/ Sam L.
Banks
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Name:
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Sam L.
Banks
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Title:
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Chief Executive
Officer
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