Teton files for bankruptcy, plans to sell assets

Teton files for bankruptcy, plans to sell assets to Rise Energy for $18.7 million in auction

• On 9:24 am EST, Monday November 9, 2009

DENVER (AP) -- Oil and gas exploration and production company Teton Energy Corp. said it filed for Chapter 11 and intends to sell its assets through a court-approved auction to Rise Energy Partners II LLC for $18.7 million.

In a filing Sunday, Teton listed total assets of $24.2 million, and total debt of $44.3 million.

Under the proposed agreement, if Rise is the highest bidder in the auction, it will contribute $11.7 million in cash and $7 million in the form of a loan. In a statement released Monday, Teton said the funds will be used to pay off its creditors. Rise Energy is a Delaware limited liability company.

Teton warned that stockholders will likely get nothing, unless the company gets a significantly higher offer in the auction process.

The Denver-based company expects the confirmation of the plan of reorganization in January 2010.

Shares of Teton fell 36 percent to 20 cents per share in premarket trading.