Yuma Energy Inc., Houston, together with subsidiaries Yuma Exploration and Production Co. Inc., Davis Petroleum Corp., and The Yuma Companies Inc., said Apr. 15 that it has filed voluntary Chapter 11 petitions in the US bankruptcy court for the Northern District of Texas to implement the orderly liquidation of assets.
The debtors intend to seek immediate court approval to conduct an auction for substantially all assets, which primarily consist of operating and non-operating interests in properties in Louisiana, Texas, Wyoming, and Oklahoma. The auction is expected to occur within the first 90 days of the bankruptcy filings.
The debtors may negotiate to obtain a new Debtor-in-Possession (DIP) financing to provide working capital to support normal operations and the sale of assets during the Chapter 11 process. However, it is not certain that these negotiations will be successfully completed.
Separately, effective Apr. 10, Anthony C. Schnur resigned from his positions as interim chief executive officer, interim chief financial officer, and chief restructuring officer. Yuma engaged Ankura Consulting Group LLC as its financial advisor. Schnur was recently hired by Ankura, and he will oversee the operation of the debtors during the bankruptcy process.
YE Investment LLC terminated its credit agreement due to Yuma’s failures to make timely interest payments and to comply with other covenants. YE notified the company that it would accelerate all payments due under the credit agreement to come due immediately. Simultaneous with the termination of the credit agreement, Red Mountain Capital Partners LLC notified Yuma that it was terminating its restructuring agreement.