UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1997
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( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File number 33-12095-NY
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SUPERIOR OIL CORPORATION
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(Exact name of registrant as specified in charter)
Nevada 13-3436101
- ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9545 116A Street, Delta, B.C., Canada, VHC 6Z3
- ---------------------------------------- --------------------
(Address of principal executive offices) (Zip Code)
(604) 582-0207
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Registrants telephone number, including area code
CAROUSEL CAPITAL, INC. , P. O. BOX 17260, SALT LAKE CITY, UTAH
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(Former name, former address, and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), Yes [X ] No [ ] and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuers classes
of common stock, as of the last practicable date.
Class Outstanding as of July 31, 1996
-------------------- -------------------------------
Common Stock, $0.001 15,022,200
<PAGE>
PART I - FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS
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The accompany unaudited financial statements have been prepared in accordance
with the instructions for Form 10-Q pursuant to the rules and regulations of the
Securities and Exchange Commission and, therefore, do not include all
information and footnotes necessary for a complete presentation of the financial
position, results of operations, cash flows, and stockholders equity in
conformity with generally accepted accounting principles. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature.
The unaudited balance sheet of the Company at July 31, 1997, and the related
audited balance sheet of the company at January 31, 1997, the unaudited
statements of operations and cash flows for the three and six months ended July
31, 1997 and 1996, and the unaudited statements of stockholders equity for the
period from February 25, 1986 to July 31, 1997, are attached hereto and
incorporated herein by this reference.
Operating results for the three and six months ended July 31, 1997, are not
necessarily indicative of the results that can be expected for the year ending
January 31, 1998.
<PAGE>
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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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Ability of the Company to Continue
- ----------------------------------
The Company has had a net operating loss carryforward of $114,061 since
inception and has very limited working capital. The Company will need additional
working capital in order to continue as a going concern and the management
believes they can accomplish this objective through additional equity funding
however there is no assurance that the Company will be able to obtain this
objective.
Liquidity and Capital Resources
- -------------------------------
At July 31, 1997 the Company had a contingent liability of $500,000 and did not
have assets with which to meet the potential obligation. See note 4 of the
financial statements
Results of Operations
- ---------------------
The Company has had no operations during this reporting period.
Regulation S stock offering and sale
- ------------------------------------
During March and April 1997 the Registrant completed a Regulation S stock
offering and sale of 13,000,000 shares of common stock with net proceeds of
$130,000. The proceeds of the sale were used to purchase marketable securities
and an interest in a gas and oil property.
Trade of Marketable Securities for an Interest in an Oil Well
- -------------------------------------------------------------
During July 1997 the registrant traded marketable securities, consisiting of
7,600 shares of Synfuel Technology and 6,700 shares of Gold Coast Resoruces, for
a 25% working interest in one oil well, covering 97 acres, located in Pleasants
County, West Virginia. The fair value of the oil well is considered to be the
cost of the stocks given in trade and will be amortized to expense over its
useful life as soon as the well becomes active. The well is presently inactive
and the registrant has no plans to reactivate it within the coming year. The
lease has an indefinite expiration date and the land owner has retained a 1/8
royalty.
<PAGE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
BALANCE SHEETS
July, 31, 1997, and January 31, 1996
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July 31, January 31,
1997 1997
ASSETS
CURRENT ASSETS
Cash $ -- $ --
--------- ---------
Total current assets -- --
--------- ---------
OTHER ASSETS
Investments - oil and gas properties - Note 4 126,500 --
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$ 126,500 $ --
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 1,400 $ 4,300
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Total current Liabilities 1,400 4,300
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STOCKHOLDERS' EQUITY
Common stock, 50,000,000 shares
authorized, at $0.001 par value;
15,022,200 shares issued and
outstanding at July 31, 1997;
1,022,200 shares at January 31, 1997
15,022 1,022
Capital in excess of par value 225,739 108,739
Deficit accumulated during the
development stage (115,661) (114,061)
--------- ---------
Total Stockholders deficiency 125,100 (4,300)
--------- ---------
$ 126,500 $ --
========= =========
<PAGE>
<TABLE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS
For the Three Months and the Six Months ended July 31, 1997
and 1996 and the Period February 25, 1986 (Date of
Inception) to July 31, 1997
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<CAPTION>
Three Six Three Six February 25, 1986
Months Months Months Months (Date of Inception)
1997 1997 1996 1996 to July 31, 1997
--------- --------- --------- --------- -------------------
<S> <C> <C> <C> <C> <C>
REVENUES $ -- $ -- $ -- $ -- $ 9,783
EXPENSES $ 480 1600 $ 375 825 124,964
--------- --------- --------- --------- ---------
NET LOSS $ (480) (1600) $ (375) (825) $(115,661)
========= ========= ========= ========= =========
NET LOSS PER COMMON
SHARE $ -- $ -- $ -- $ --
========= ========= ========= =========
</TABLE>
<PAGE>
<TABLE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Period from February 25, 1986 (Date of Inception)
to July 31, 1997
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<CAPTION>
Common Stock Excess of Accumulated
------------------
Shares Amount Par Value Deficit
------ ------ ----------- -----------
<S> <C> <C> <C> <C>
Balance February 25, 1986 (Date of
Inception) -- $ -- $ -- $ --
Issuance of common stock for cash
September 17, 1986 6,000 6 5,994 --
Issuance of common stock for cash
less costs - April 9, 1987 10,000 10 77,551 --
Net income for the year ended
January 31, 1988 -- -- -- (8,461)
--------- --------- --------- ---------
Balance January 31, 1988 16,000 16 83,545 (8,461)
--------- --------- --------- ---------
Net loss for the year ended
January 31, 1989 -- -- -- (23,123)
Net income for the year ended
January 31, 1990 -- -- -- 99
Net loss for the year ended
January 31, 1991 -- -- -- (52,076)
--------- --------- --------- ---------
Balance January 31, 1991 16,000 16 83,545 (83,561)
--------- --------- --------- ---------
Balance January 31, 1993 16,000 16 83,545 (83,561)
--------- --------- --------- ---------
Issuance of common stock for
expenses and services -
July 1, 1993 6,200 6 6,194 --
Net loss for the year ended
January 31, 1994 -- -- -- (6,200)
--------- --------- --------- ---------
Balance January 31, 1994 22,200 22 89,739 (89,761)
--------- --------- --------- ---------
</TABLE>
<PAGE>
<TABLE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Continued)
Period from February 25, 1986 (Date of Inception)
to July 31, 1997
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<CAPTION>
Common Stock Capital in
----------------- Excess of Accumulated
Shares Amount Par Value Deficit
------ ------ ---------- ------------
<S> <C> <C> <C> <C>
Balance January 31, 1995 22,200 $ 22 $ 89,739 $ (89,761)
Net loss for the year ended
January 31, 1996 -- -- -- (2,050)
---------- ---------- ---------- -----------
Balance January 31, 1996 22,200 22 89,739 (91,811)
Issuance of common stock for
cash - August 28, 1996 1,000,000 1,000 19,000
Net loss for the year ended
January 31, 1997 -- -- -- (22,250)
---------- --------- ---------- -----------
Balance January 31, 1997 1,0 22,200 1,022 108,739 (114,061)
Issuance of common stock for
cash - March 4, 1997 2,000,000 2,000 18,000 --
Issuance of common stock for
cash - March 27, 1997 11,000,000 11,000 99,000 --
Issuance of common stock for
oil properties - April 2, 1997 1,000,000 1,000 -- --
Net loss for six months
ended July 31, 1997 -- -- -- (1,600)
---------- --------- ---------- -----------
Balance July 31, 1997 15,022,200 $ 15,022 $ 225,739 $ (115,661)
========== ========= ========== ==========
</TABLE>
<PAGE>
<TABLE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
STATEMENT OF CASH FLOWS
For the Three Months and the Six Months Ended July 31, 1997
and 1996 and the Period from
February 25, 1986 (Date of Inception) to July 31, 1997
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<CAPTION>
Three Six Three Six February 25, 1986
Months Months Months Months (Date of Inception)
1997 1997 1996 1996 to July 31, 1997
-------- -------- -------- -------- -------------------
CASH FLOWS FROM
OPERATING ACTIVITIES:
<S> <C> <C> <C> <C> <C>
Net loss $ (480) $ (1600) $ (375) $ (825) $(115,661)
Adjustments to reconcile net loss to
net cash provided by operating
activities:
Capital stock issued for:
Expenses and services -- -- 6,200
Increase (decrease) in accounts
payables 480 (2,900) 375 825 1,400
--------- --------- --------- --------- ---------
Net Cash Used by Operations -- (4,500) -- -- (108,061)
--------- --------- --------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase securities and oil properties -- (126,500) -- -- (126,500)
--------- --------- --------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from issuance of common
stock -- 131,000 -- -- 234,561
--------- --------- --------- --------- ---------
Net Increase (Decrease) in Cash -- -- -- --
Cash Beginning of Period -- -- -- -- --
--------- --------- --------- --------- ---------
Cash End of Period $ -- $ -- $ -- $ -- $ --
--------- --------- --------- --------- ---------
SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
Issuance of 6,200 common shares for expenses - 1993 $ 6,200
Issuance of 1,000,000 common shares for oil property $ 1,000
</TABLE>
<PAGE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
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1. ORGANIZATION
The Company was incorporated under the laws of the state of Nevada on February
25, 1986 with authorized capital stock of 500,000,000 shares at $0.001 par value
and on March 28, 1995 the authorized capital stock was decreased to 50,000,000
shares at $0.001 par value.
On March 17, 1997 the Company changed its name to Superior Oil Corporation
from Carousel Capital, Inc.
During March and April 1997 the Company completed a public offering and sale of
13,000,000 shares of its common capital stock.
The Company completed a reverse stock split on November 28, 1995 at 1,000 shares
for one share. This report has been prepared showing after stock split shares
from inception.
Since its inception the company has been in the development stage and has been
engaged in seeking business opportunities.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
- ------------------
The Company recognizes income and expenses based on the accrual method of
accounting.
Dividend Policy
- ---------------
The Company has not yet adopted a policy regarding payment of dividends.
Income Taxes
- ------------
At January 31, 1997, the Company had a net operating loss carry forward of
$114,061. The tax benefit from the loss carry forward has been fully offset by a
valuation reserve, because the use of the future tax benefit is doubtful, since
the Company has no operations and there has been substantial changes in the
stockholders.
Earnings (Loss) Per Share
- -------------------------
Earnings (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding after the reverse stock split.
<PAGE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
Estimates and Assumptions
- -------------------------
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
Financial instruments
- ---------------------
The carrying amounts of financial instruments, including the oil leases and
accounts payable, are considered by management to be their estimated fair
values. These values are not necessarily indicative of the amounts that the
Company could realize in a current market exchange.
3. INVESTMENTS - AVAILABLE-FOR-SALE SECRURITIES
During March and April 1997 the Company purchased restricted securities outlined
below and during July 1997 the securities were traded for an oil well lease
outlined in note 4.
Name of Stock Number of Shares Cost - Fair Value
------------- ---------------- -----------------
Synfuel Technology 7,600 $17,000
Gold Coast Resources 6,700 33,500
-------
$50,500
-------
4. INVESTMENTS - OIL AND GAS PROPERTIES
During April 1997 the Company purchased a joint venture, working interest, in an
oil and gas property, with Opturnal Energy. The property is located 42 miles
northwest of Lubbock, Texas and covers 13,600 production acres and is estimated
to contain over 100 million barrels of oil and 167 billion cubic feet of gas.
The Company is committing $500,000 for the leasing, engineering, and drilling of
the property , however at the report date no activity had been started nor does
the Company have the assets to pay the commitment The land owner and Opturnal
Energy have retained a 1/8 royalty each.
During July 1997 the Company traded marketable securities, consisiting of 7,600
shares of Synfuel Technology and 6,700 shares of Gold Coast Resoruces, for a 25%
working interest in one oil well, covering 97 acres, located in Pleasants
County, West Virginia. The fair value of the oil well is considered to be the
cost of the stocks given in trade and will be amortized to expense over its
useful life as soon as the well becomes active. The well is presently inactive
and the registrant has no plans to reactivate it within the coming
<PAGE>
SUPERIOR OIL CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
4. INVESTMENTS - OIL AND GAS PROPERTIES - continued
year. The lease has an indefinite expiration date and the land owner has
retained a 1/8 royalty.
5. RELATED PARTY TRANSACTIONS
The officers and directors of the Company are involved in other business
activities and they may, in the future, become involved in additional business
ventures which also may require their attention. If a specific business
opportunity becomes available, such persons may face a conflict in selecting
between the Company and their other business interests. The Company has
formulated no policy for the resolution of such conflicts.
6. CONTINGENT LIABILITIES
See note 4 regarding a $500,000 commitment to develop an oil and gas property.
7. GOING CONCERN
Continuation of the Company as a going concern is dependent upon obtaining
additional working capital and the management of the Company has developed a
strategy, which it believes will accomplish this objective through additional
equity funding which will enable the Company to continue operations into the
future.
Management recognizes that, if it is unable to raise additional capital, it
cannot conduct operations in the future.
<PAGE>
PART II - OTHER INFORMATION
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ITEM 1. LEGAL PROCEEDINGS
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None.
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ITEM 2. CHANGES IN THE SECURITIES
- --------------------------------------------------------------------------------
During March and April 1997 he registrant completed a regulation S offering and
sale of 13,000,000 common shares of its capital stock for a net proceeds of
$130,000.
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ITEM 3. DEFAULTS UPON SENIOR SECURITIES
- --------------------------------------------------------------------------------
None.
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- --------------------------------------------------------------------------------
None.
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ITEM 5. OTHER INFORMATION
- --------------------------------------------------------------------------------
On June 30, 1997 there was a change in the officers of the registrant. Ranbir
Dhaliwal, president, resigned and appointed Daniel Maarsman, president, who
accepted, and Laura Olson, secretary, resigned, and appointed Lorraine Laatsche,
secretary, who accepted.
The resigning officers had no disagreements with the registrant.
- --------------------------------------------------------------------------------
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- --------------------------------------------------------------------------------
A form 8-K filed during this period reported a change in the name of the
registrant from Carousel Capital,
<PAGE>
Inc. to Superior Oil Corporation.
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SIGNATURES
- --------------------------------------------------------------------------------
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 thereunto duly authorized.
SUPERIOR OIL CORPORATION
[Registrant]
Dated October , 1997 By
------------------------------
Daniel Maarsman, President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-31-1998
<PERIOD-END> JUL-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 4,300
<BONDS> 0
0
0
<COMMON> 1,022,200
<OTHER-SE> (4300)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (22,250)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
