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 1821, 2009 (December 1415, 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 consummate our plan of reorganization as currently planned;

· ~~our~~risks ~~ability~~associated towith ~~seek,~~third ~~obtain~~party ~~and~~motions ~~approve~~in athe ~~higher~~Chapter or11 ~~better~~proceeding, ~~offer~~which asmay ~~the~~interfere ~~winning~~with ~~bid~~our inreorganization ~~the~~as ~~bankruptcy~~currently ~~court auction process~~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.

Item 1.01 Entry into a Material Definitive Agreement.

~~Teton~~On ~~Energy~~December ~~Corporation~~15, (“2009, Teton” orEnergy ~~the~~Corporation, ~~“Company”) entered into~~ a ~~Debtor~~Delaware ~~in Possession~~corporation, ~~Financing Amendment~~ and ~~Fourth Amendment to Second Amended and~~its ~~Restated~~subsidiaries ~~Credit Agreement~~ (~~the~~collectively, “~~Fourth Amendment~~Teton”), ~~effective~~conducted asa ofbankruptcy ~~December~~auction ~~14, 2009~~for (the sale ~~“Effective~~of ~~Date”),~~Teton ~~with~~and/or ~~its~~substantially ~~pre-petition~~all ~~lenders,~~of ~~JPMorgan~~its ~~Chase Bank~~assets, ~~N.A.~~ ~~(“JPMorgan~~pursuant ~~Chase”),~~to asthe ~~administrative~~Order ~~agent,~~(I) Approving ~~and~~Bidding ~~each~~Procedures offor the ~~financial institutions~~Transfer ~~identified~~of inSubstantially ~~the~~All ~~Fourth~~of ~~Amendment (JPMorgan Chase and~~ the ~~financial~~Debtors’ ~~institutions~~Assets ~~are~~Through ~~hereinafter~~a ~~collectively~~Chapter ~~referred~~11 toPlan asof ~~the “Postpetition~~Reorganization, ~~Lenders”~~(II)~~. The~~ ~~Fourth~~Approving Certain ~~Amendment~~Bidding ~~was~~Protections, ~~entered~~and ~~into pursuant~~(III) toScheduling an ~~order~~Auction, ~~signed~~entered by the ~~United States~~ Bankruptcy ~~Judge~~Court for the District of Delaware, ~~which order allowed~~ (the ~~Company~~“Bankruptcy toCourt”). ~~obtain~~At ~~post-petition~~the ~~financing~~conclusion ~~from~~of the ~~Company’s~~auction, ~~pre-petition~~Caerus ~~lenders~~Oil inand anGas ~~amount~~LLC, ~~not~~a toDelaware ~~exceed~~limited liability ~~$750,000~~company (~~the~~ “~~DIP Financing~~Caerus”)~~. In~~ ~~connection~~was ~~with~~selected ~~the~~as ~~execution of~~ the ~~Fourth~~prevailing ~~Amendment~~bidder. There ~~and~~are no ~~the~~relationships ~~delivery~~between ofTeton ~~the~~or ~~DIP~~its ~~Financing~~affiliates ~~facility~~and Caerus, ~~the~~other ~~Company~~than with ~~paid~~respect to the ~~Administrative Agent a fee of $15,000~~auction.

~~All~~As ~~capitalized~~previously ~~terms~~disclosed, ~~not~~in ~~defined~~connection ~~herein~~with ~~shall~~the ~~have~~filing by Teton of voluntary petitions for reorganization proceedings under Chapter 11 of the ~~meaning~~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 inbelow, the Caerus Plan ~~Fourth~~Sponsorship ~~Amendment~~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.

~~The~~Pursuant ~~Fourth~~to ~~Amendment~~the ~~made~~Caerus Plan Sponsorship Agreement, Caerus will acquire one hundred percent (100%) of the ~~following~~membership ~~changes~~interests toof the ~~Second~~reorganized ~~Amended~~Teton ~~and~~with ~~Restated~~Teton’s ~~Credit~~assets ~~Agreement~~re-vesting ~~dated~~in asthe reorganized Teton free and clear of ~~April~~all 2liens, ~~2008~~claims and encumbrances that are not enumerated in Teton’s Plan of Reorganization. The consideration will be comprised of (asi) $20,050,000 ~~modified~~in cash (subject to ~~date~~post-closing working capital adjustments), and (ii) a contractual participation right to 50% of the ~~“Credit~~profits (net of the payment ~~Agreement”~~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.

~~(a) The~~Pursuant ~~definition~~to ofthe ~~“loan~~terms ~~documents”~~of ~~has~~the ~~been~~Rise ~~revised~~Plan toSponsorship ~~mean~~Agreement, because the ~~Fourth~~purchase ~~Amendment,~~and ~~the~~sale ~~First~~of ~~Amendment,~~Teton’s ~~the~~assets ~~Second~~will ~~Amendment,~~not ~~the~~be ~~Third~~consummated ~~Amendment~~with Rise, ~~the~~Rise ~~Notes,~~is ~~the~~entitled to a ~~Letter~~break-up fee of ~~Credit Agreements~~$750,000 and the ~~Letters~~reimbursement of ~~Credit,~~Rise’s ~~the~~actual ~~Intercreditor Agreement~~out-of-pocket and ~~the~~reasonable ~~Security~~third-party ~~Instruments;~~costs and expenses in an amount not to exceed $200,000.

~~(b) The~~Consummation ~~definition~~ of ~~“material~~the ~~adverse~~transaction ~~effect”~~with ~~has~~Caerus ~~been~~is ~~revised~~subject to ~~include~~approval ~~events~~and ~~that could~~confirmation ~~have~~by ~~a material adverse effect on~~ the ~~DIP Collateral, or the~~ ~~Administrative~~Bankruptcy ~~Agent’s~~Court. The ~~liens~~confirmation ~~(on~~hearing ~~behalf~~has ofbeen ~~itself~~scheduled ~~and the Lenders) on the DIP~~for ~~Collateral~~January 8, ~~or the priority of such liens;~~2010.

~~(c) Numerous~~The ~~definitions~~foregoing ~~related~~summary toof the ~~DIP~~Caerus ~~Financing,~~Plan ~~the~~Sponsorship ~~DIP~~Agreement ~~Collateral~~is ~~and~~qualified ~~the~~in ~~Company’s~~its ~~bankruptcy~~entirety ~~filing~~by ~~have~~reference ~~been~~to ~~added~~the todefinitive ~~Section~~transaction ~~1.02~~document(s), a copy of which will be filed with the ~~Credit~~Securities and Exchange Commission when it becomes ~~Agreement;~~available.

(d) Article 2 of the Credit Agreement has been amended to add a section detailing the terms and conditions of the Postpetition Loans;

(e) Clause (d) of Section 3.02 regarding Interest Payment Dates has been revised to indicate that, from and after the Petition Date, accrued interest on each Loan (other than a Postpetition Loan) will be due for such Loan commencing on the earliest of (1) a termination of the Rise Transaction or Plan Sponsorship Agreement, (2) the closing of the sale of all or a material part of the assets of the Company, or (3) January 31, 2010;

(f) Article 8 of the Credit Agreement was amended to add a section describing the Company’s post-petition budget and a section describing the reports to be provided to the Postpetition Lenders;

(g) The Company agreed not to incur any debt senior to or on a parity with the Lenders’ debt; and

(h) The Company agreed that it shall not pay any fees or expenses to any Bankruptcy Court-approved professional until such professional is authorized to be paid by the Bankruptcy Court.

There are no other material relationships between the Company or its affiliates and the Postpetition Lenders, other than in respect to the Credit Agreement.

The foregoing summary of the Fourth Amendment is qualified in its entirety by reference to the definitive transaction documents, a copy of which is attached as Exhibit 10.1 to this Current Report.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off Balance Sheet Arrangement of a Registrant

The information included in Item 1.01 of this Current Report is hereby incorporated by reference into this Item 2.03.

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/.

Item 9.01 Financial Statements and Exhibits

(a) Financial statements of businesses acquired

N/A

(b) Pro forma financial information

N/A

(d) Exhibits

Exhibit No.				Description
	10.1			Debtor in Possession Financing and Fourth Amendment to Second Amended and Restated Credit Agreement, effective as of December 14, 2009 (without exhibits)

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 1821, 2009


	TETON ENERGY CORPORATION
	By:	/s/ Jonathan Bloomfield
		Jonathan Bloomfield
		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.				Description
	10.1			Debtor in Possession Financing and Fourth Amendment to Second Amended and Restated Credit Agreement, effective as of December 14, 2009 (without exhibits)

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