<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d) of
The Securities Exchange Act of 1934
For the Three Months Ended September 30, 1997
Commission File Number 0-9355
ROSELAND OIL AND GAS, INC.
(Exact name of registrant as specified in its charter)
1724 East 15th Street
Tulsa, Oklahoma 74104
Telephone:(918) 742-0028
Incorporated in the State of Oklahoma
IRS No. 87-0352095
Securities registered pursuant to Section 12(g) of the Act:
TITLE OF CLASS
Common Stock (par value $.05 per share)
Check whether the registrant (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the
past 90 days.
(1) Yes [X] No [ ]
(2) Yes [X] No [ ]
Indicate the number of shares outstanding od each of the issuer's
classes of common stock, as of the latest practical date:
Common Stock, $.05 Par Value - 5,030,847 shares as of September 30, 1997.
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<TABLE>
ROSELAND OIL AND GAS, INC.
<CAPTION>
TABLE OF CONTENTS
<S> <S> <C> <C> <C>
PART I
ITEM 1. Financial Statements
Balance Sheets - September 30, 1997 and June 30, 1997
ASSETS . . . . . . . . . . . . . . . . . . . . . . . . F-1
LIABILITES & STOCK HOLDERS EQUITY. . . . . . . . . . . F-2
Statements of Operations - Income (Loss)
for the three months ended September 30,
1997 and 1996 . . . . . . . . . . . . . . . . . . . . . . . F-3
Consolidated Statements of Changes - Stockholder's Equity
the three months ended September 30, 1997 . . . . . . . . . F-4
Statement of Cash Flows
for the three months ended
September 30, 1997. . . . . . . . . . . . . . . . . . . . . F-5
Notes to Unaudited Financial
Statements. . . . . . . . . . . . . . . . . . . . . . . . . . .6
ITEM 2. Management's Discussion and Analysis. . . . . . . . . . . . . .6
PART II
ITEM 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . .7
ITEM 2. Changes in Securities . . . . . . . . . . . . . . . . . . . . .7
ITEM 3. Defaults upon Senior Securities . . . . . . . . . . . . . . . .7
ITEM 4. Submission of Matters to a Vote of Security
Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
ITEM 5. Other Information . . . . . . . . . . . . . . . . . . . . . . .7
ITEM 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . .7
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
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ROSELAND OIL AND GAS INC. AND SUBSIDIARIES
NOTES TO UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed by Roseland Oil and Gas, Inc. (the
"Company" or "Roseland") are set forth in Note 2 to the Company's financial
statements in its June 30, 1997, Form 10-KSB and should be read in
conjunction with the consolidated financial statements for the three months
ended September 30, 1997, contained herein.
The financial statements included herein as of September 30, 1997, and
the three month period ended September 30, 1997 have been prepared by the
Company, without an audit, pursuant to generally accepted accounting
principles and the rules and regulations of the Securities and Exchange
Commission. The Company believes that the disclosures are adequate to make
the information presented not misleading. The information presented reflects
all adjustments (consisting solely of normal recurring adjustments) which
are, in the opinion of management, necessary for a fair statement of results
for the period.
The prior year financial statements have been restated to conform with
current year presentation.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
THREE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO THREE MONTHS ENDED
SEPTEMBER 30, 1996.
Gross revenues for the three months ended September 30 decreased from
$116,000 in 1996 to $ 44,000 in 1997 primarily due to the sale of several
wells which were reaching their economic limit.
Oil and gas production, operating and development costs decreased from
$42,000 (54% of oil and gas sales) in 1996 to $19,000 (47% of oil and gas
sales) in 1997. Selling, general and administrative expenses decreased from
$36,000 in 1996 to $30,000 in 1997 due to cost control.
Operating income and net income decreased from $3,000 in 1996 to a loss
of ($ 5,000) in 1997 due to sale of several wells.
LIQUIDITY AND CAPITAL RESOURCES
The Company used from its operating activities $2,000 of net cash,
$33,000 was received from the sale of stock, $2,000 of net cash from the
payment of notes receivable, of which $13,000 was paid on borrowings and the
remainder for the purchase of property and equipment of $25,000.
The Company's total long term debt at September 30, 1997 was $278,000 of
which $69,000 was classified as current. This compares to total long term
debt of $291,000 outstanding at June 30, 1997 of which $76,000 was classified
as current.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
An action was filed against certain directors of a former subsidiary of
Roseland Oil and Gas, Inc., alleging that the settlement entered into
breached a duty to the creditors of that subsidiary and the directors are
liable for the debt of this creditor. Roseland Oil and Gas, Inc. has an
indemnification agreement to pay defense and pay any judgement of the
directors since the settlement was directed by Roseland Oil and Gas, Inc.
The amount in question is $65,000 plus interest, plus cost of defense.
Roseland Oil and Gas, Inc. attorneys have advised that Roseland Oil and Gas,
Inc. exposure beyond the cost of defense, is minimal.
ITEM 2. CHANGES IN SECURITIES
On September 5, 1997 Roseland amended its Certificate of Incorporation
with the Secretary of State of Oklahoma to increase the aggregate number of
authorized shares of common stock from 10,000,000 shares to 50,000,000 shares.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
Subsequent Events:
A Definitive Agreement for an interest in a drilling prospect has been
executed in exchange for Roseland Stock. Whereby Calvin Wallen III will
transfer a working interest in a lease for 12,500,000 shares of Common Stock.
This would substantially change control of the company.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None.
<PAGE>
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
ROSELAND OIL AND GAS, INC.
DATE: January 21, 1998 BY: ___________________________
William G. Vandever
President
<PAGE>
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
ROSELAND OIL AND GAS, INC.
DATE: January 21, 1998 BY: /S/William G. Vandever
William G. Vandever
President
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ROSELAND OIL AND GAS,INC.
BALANCE SHEET
SEPTEMBER 30, 1997 AND JUNE 30, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<CAPTION>
ASSETS SEPT 30 JUNE 30
1997 1997
<S><S> <S> <S> <C> <C>
Current Assets:
Cash and cash equivalents $ 14 $ 19
Accounts receivable:
Trade 151 148
Related Parties 0 0
Notes Receivable:
Trade 0 2
Related Parties 0
Inventory 33 14
------------ --------
Current Assets 198 183
------------ --------
Property and equipment, at cost
Oil and gas properties:
(successful efforts method):
Proved properties
(including wells and related
equipment and facilities) $ 3,000 $ 2,977
Real Estate holdings
Buildings 210 210
Office and other equipment 73 71
------------- ------------
Total property and equipment 3,283 3,258
Less accumulated depreciation
depletion, and amortization 866 866
------------- ------------
Net Property and Equipment 2,417 2,392
------------- ------------
Other Assets:
Marketable equity securities of
related parties at lower cost or market $ 0 $ 0
Notes Receivable; less current portion 0 0
Other 602 544
------------- ------------
Total Other Assets 602 544
------------- ------------
Total Assets $ 3,217 3,119
============= ============
(continued)
The accompanying notes are part of these financial statements.
F-1
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<TABLE>
ROSELAND OIL AND GAS,INC.
BALANCE SHEET
SEPTEMBER 30, 1997 AND JUNE 30, 1997
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<CAPTION>
LIABILITIES & STOCKHOLDERS EQUITY SEPT 30 JUNE 30
1997 1997
<S><S> <S> <S> <C> <C>
Current Liabilities:
Current portion of long-term debt $ 69 $ 76
Accounts Payable 176 93
Oil and gas revenues payable 1 1
Accrued income taxes 0 0
Other accrued liabilities 0 0
------------- ------------
Total Current Liabilities 246 170
------------- ------------
Long-term Debt, less current portion:
Oil and gas revenue payable $ 0 0
Other 209 215
------------- ------------
Total Long-term Debt 209 215
------------- ------------
Deferred Income taxes $ 0 $ 0
Stockholders Equity
Series A preferred stock,
par value $.01 per share $ 0 $ 0
authorized 10,000,000 shares,
issued -0- shares 0 0
Common stock, $.05 par value,
authorized 50,000,000 shares,
issued 5,030,847 shares 252 252
Additional paid-in capital 2,391 2,395
Stock Subscribed - to be issued 110 72
Retained earnings 63 69
Treasury stock (25,340 shares),
at cost (54) (54)
------------- ------------
Total Stockholders' Equity 2,762 2,734
------------- ------------
Total Liability & Stockholders' Equity 3,217 3,119
============= ============
The accompanying notes are part of these financial statements
F-2
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<TABLE>
ROSELAND OIL AND GAS, INC.
STATEMENTS OF OPERATION
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(In thousands, except per share amounts)
<CAPTION>
THREE MONTHS ENDING
September 30,
1997 1996
<S> <S> <S> <C> <C>
Oil and gas sales $ 40 $ 77
Overhead recovery fees 4 39
Total Revenues 44 116
Costs and Expenses:
Oil and gas production, operating
and development costs $ 19 $ 42
Abandoned leases
Selling, general and
administrative expenses 30 36
Depreciation, depletion and amortization 0 35
Total Costs and Expenses 49 113
Operating Income (Loss): $ (5) $ 3
Non-operating Income (Expenses):
Interest Income $ 0 $ 0
Gain (loss) on sale of assets 0 0
Other income 0 0
interest expense 0 0
Income before provision for income taxes $ (5) $ 3
Provision (benefit) for income taxes 0 0
Net Income (loss) $ (5) $ 3
EARNINGS (LOSS) PER COMMON SHARE: $ 0 $ 0
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: 5,031 5,031
The accompanying notes are part of these financial statements
F-3
</TABLE>
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<TABLE>
ROSELAND OIL AND GAS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
September 30, 1997
<CAPTION>
Cumulative Common Common Additional Stock Preferred Total
Preferred Shares Stock Paid-In Retained Subscripts Dividend Treasury Stockholder
Stock O/S Par Value Capital Earnings Receivable Payable Stock Equity
<S><S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, June 30, 1996 $ 2,000 4,572,149 $ 228,607 $ 2,383,715 $ 64,570 $ 0 $ 0 $(53,877) $ 2,625,015
Preferred dividend 0 0 0 0 (35,000) 0 35,000 0 0
Conversion of Preferred
to Common (2,000) 400,000 20,000 13,500 31,500
Conversion of Dividend
Pay to Stock 0 58,698 3,500 4,769 (35,000) (26,731)
Sale of stock -
Private Placements 0 0 0 0 0 71,500 0 0 71,500
Sale of stock-10% Commission (7,150) (7,150)
Net income,
year ended June 30, 1997 0 0 0 0 39,500 0 0 0 39,520
Balance, June 30, 1997 $ 0 5,030,847 $ 252,107 $ 2,394,834 $ 69,090 $ 71,500 $ 0 $(53,877) $ 2,733,654
Sale of stock -
Private Placements 0 0 0 0 0 38,500 0 0 38,500
Sale of stock-10% Commission (3,850) (3,850)
Net income,
quarter ended Sept. 30, 1997 0 0 0 0 (5,676) 0 0 0 (5,676)
Balance,
September 30, 1997 $ 0 5,030,847 $ 252,107 $ 2,390,984 $ 63,414 $ 110,000 $ 0 $(53,877) $ 2,762,628
The accompanying notes are part of these financial statements
F-4
</TABLE>
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<TABLE>
ROSELAND OIL AND GAS, INC. AND SUBSIDIARY
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997
UNAUDITED
<CAPTION>
THREE MONTHS
ENDED
SEPT. 30
1997
<S> <S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (5)
Adjustments to reconcile net income (loss)
to cash provided (used) by operating activities:
Depreciation, depletion and amortization 0
(Gain) loss from sale of assets 0
Provision (benefit) for deferred income tax
Change in assets and liabilities
(Increase) in accounts receivable (3)
(Increase) in notes receivable 0
(Increase) decrease in other assets (77)
Increase (decrease) in accounts payable 83
Net cash provided (used) by operating activites $ (2)
Cash flows from investing activities:
Proceeds from disposal property and equipment $ 0
Purchase of property and equipment (25)
Loans to related parties 0
Net cash provided (used) by investing activities $ (25)
Cash flows from financing activities:
Issuance of common stock $ 33
Retirement of common stock 0
Issuance of preferred stock 0
Dividend payment 0
Additional debt 2
Payments on debt (13)
Net cash provided (used) by financing activites $ 22
Net increase (decrease) in cash and cash equivalents $ (5)
Cash beginning of period 19
Cash at end of period $ 14
The accompanying notes are part of these financial statements
F-5
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 14
<SECURITIES> 0
<RECEIVABLES> 151
<ALLOWANCES> 0
<INVENTORY> 33
<CURRENT-ASSETS> 198
<PP&E> 3283
<DEPRECIATION> 866
<TOTAL-ASSETS> 3217
<CURRENT-LIABILITIES> 246
<BONDS> 0
0
0
<COMMON> 252
<OTHER-SE> 2400
<TOTAL-LIABILITY-AND-EQUITY> 3217
<SALES> 40
<TOTAL-REVENUES> 44
<CGS> 0
<TOTAL-COSTS> 46
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3
<INCOME-PRETAX> (5)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
