SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
(MARK ONE)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
- -------
SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December
31, 1996
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition period from to
Commission File Number: 33-15097-D
BASIC NATURAL RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Colorado 84-10457105
(State or other Jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
2450 South Shore Boulevard, Suite 210, League City, Texas 77573
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (281) 334-0708
Check whether the issuer (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), and (2) has been subject to such filing requirements for the past
90 days. Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
stock as of the latest practicable date.
Common Stock, $.003 Par Value 1,490,367
----------------
(Shares outstanding as of December 31, 1996)
Transitional Small Business Disclosure Format (Check One) Yes No X
1
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BASIC NATURAL RESOURCES, INC.
QUARTERLY REPORT ON FORM 10-QSB FOR THE INTERIM
PERIOD ENDED DECEMBER 31, 1996
REASON FOR AMENDMENT
The 10-QSB is being amended to correct a transposition error in the number
of shares originally reported as outstanding. 1,490,304 was originally
typed as 1,409,304 on the cover page of Form 10-QSB and page 5 of the
financial statements. The 10-QSB is also being amended to reflect
outstanding stock as 1,490,367, which corrects a discrepancy related to
rounding on a reverse split.
TABLE OF CONTENTS
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Page
Number
Part I. Financial Information
Item I. Financial Statements
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Balance Sheets at December 31, 1996 and June 30, 1996.......................................... 3
Statements of Operations for the Six Months Ended December 31,
1996 and 1995..................................................................................4
Statements of Changes in Stockholders' Deficit for the Year Ended
June 30, 1996 and the Six Months Ended December 31, 1996.......................................5
Statements of Cash Flows for the Six Months Ended December 31,
1996 and 1995..................................................................................6
Notes to Financial Statements...................................................................7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.................................................................7
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K......................................................8
Signatures............................................................................9
</TABLE>
2
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BASIC NATURAL RESOURCES INC.
Balance Sheets
<TABLE>
<CAPTION>
December 31, 1996 June 30, 1996
(Unaudited) (Audited)
ASSETS
Current Assets:
<S> <C> <C>
Cash and cash equivalents $ 3,652 $ 0
----------------- -----------------
Total Current Assets 3,652 0
----------------- -----------------
Total Assets $ 3,652 $ 0
================= =================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Accounts payable and accrued liabilities $ 44,659 $ 28,009
Loans payable 21,600 13,200
Income taxes payable 0 0
----------------- -----------------
Total Current Liabilities 66,259 41,209
Stockholders' Deficit:
Preferred Stock - $1 par value 10,000,000 shares authorized; -0- shares of
Series A Voting Preferred Stock outstanding at December 31, 1996 and
174,865 shares issued and outstanding at June 30, 1996 0 174,865
Common Stock - $.003 par value, 25,000,000 shares authorized; 1,490,367
shares issued and outstanding at December 31, 1996 and 39,668 shares
issued and outstanding at June 30, 1996 4,471 119
Additional paid-in capital 4,805,894 4,610,729
Retained earnings (deficit) (4,872,972) (4,826,922)
----------------- -----------------
Total Stockholders' Deficit (62,607) (41,209)
----------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 3,652 0
================= =================
</TABLE>
See Accompanying Notes to the Financial Statements.
3
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BASIC NATURAL RESOURCES INC.
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1996 1995
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES $ 0 $ 0
Cost and Expenses:
General and Administrative 46,050 547
----------------- -----------------
Total Costs and Expenses 46,050 547
----------------- -----------------
Income (loss) from Continuing Operations: (46,050) (547)
Income tax expense (benefit) 0 0
----------------- -----------------
Net Income (Loss) $ (46,050) $ (547)
================== ==================
Income (loss) per share (continuing operations) $ (.58) $ (.01)
Income (loss) per share (discontinued operations) .00 .00
----------------- -----------------
Income (Loss) Per Share $ (.58) $ (.01)
================= =================
</TABLE>
See Accompanying Notes to the Financial Statements.
4
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BASIC NATURAL RESOURCES INC.
STATEMENT OF STOCKHOLDERS' DEFICIT
For Year Ended June 30,1996 (audited) and
For the Six Months Ended December 31, 1996
(unaudited)
<TABLE>
<CAPTION>
Additional Retained Total
Common Preferred Paid-in Earnings Stockholders'
Shares Amount Shares Amount Capital (Deficit) Deficit
------------- ------------- -------------- ------------- ------------- -------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balances at June 30,
1996 39,668 $ 119 174,865 $ 174,865 $ 4,610,729 $ (4,826,922) $ (41,209)
Sale of restricted common
stock for cash 1,217,500 3,652 3,652
Issuance of restricted
common stock for
expenses 58,334 175 20,825 21,000
Issuance of common
shares for preferred
shares 174,865 525 (174,865) (174,865) 174,340 0
Net loss 0 (46,050) (46,050)
------------- ------------- ------------- ------------- ------------- --------------- -------------
Balances at December
31, 1996 1,490,367 $ 4,471 0 $ 0 $ 4,805,894 $ (4,872,972) $ (62,607)
============= ============= ============== ============= ============= ============== =============
</TABLE>
See Accompanying Notes to the Financial Statements.
5
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BASIC NATURAL RESOURCES INC.
Statements of Cash Flow
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1996 1995
CASH FLOWS OPERATING ACTIVITIES:
<S> <C> <C>
Net income (loss) $ (46,050) $ (547)
Adjustments to reconcile net income (loss) to net cash used in operating
activities:
Stock issued for expenses 21,000 0
Changes in Assets and Liabilities:
Accounts payable 16,650 0
------------------ ------------------
Net Cash Required by Operating Activities (8,400) (547)
CASH FLOW FROM INVESTING ACTIVITIES:
Sale of common stock 3,652 0
Loan proceeds 8,400 0
------------------ ------------------
Net Cash Provided by Financing Activities 12,052 0
------------------ ------------------
Net Increase (Decrease) in Cash 3,652 (547)
CASH AT BEGINNING OF YEAR 0 644
------------------ ------------------
CASH AT END OF PERIOD $ 3,652 $ 97
================== ==================
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ 0 $ 0
Income taxes paid 0 0
------------------ ------------------
$ 0 $ 0
================== ==================
</TABLE>
See Accompanying Notes to the Financial Statements.
6
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BASIC NATURAL RESOURCES INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996
1. Basis of Presentation
The financial statements of Basic Natural Resources Inc. (the "Company"),
included herein, are unaudited for all periods ended December 31, 1996 and 1995.
They reflect all adjustments (consisting of normal recurring adjustments) which
are, in the opinion of management, necessary to fairly depict the results for
the periods presented. Certain information and note disclosures, normally
included in financial statements prepared in accordance with generally accepted
accounting principles, have been condensed or omitted pursuant to rules and
regulations of the Securities and Exchange Commission. It is suggested that
these financial statements be read in conjunction with the audited financial
statements for the years ended June 30, 1996 and 1995, which are included in the
Company's annual report. The Company believes that the disclosures made herein
are adequate to make the information presented not misleading.
2. Earnings per Common and Common Equivalent Share
Earnings per common and common equivalent share is based on the average
number of common shares and dilutive common share equivalents outstanding for
the six months ended December 31, 1996 and 1995, adjusted for a 1-for-60 reverse
stock split which has been applied retroactively. The stock split was approved
by the shareholders on January 10, 1997.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
General
The Company ceased all oil and gas operations in June 1994, following the
disposition of its oil and gas interests. The Company continues to seek
acquisitions and mergers in the area of computer related technologies.
Management believes that an acquisition of this nature will provide an
opportunity to enhance stockholder value.
Results of Operations
Analysis of Six Months ended December 31, 1996 Compared to Six Months ended
September 30, 1995
Costs and expenses for the six months ended December 31, 1996 were $46,050
and were associated with general and administrative expenses. The amount of
$30,000 was included in the expenses to settle the environmental litigation
against the Company. Cash in the amount of $10,000
7
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will be paid and 33,334 shares of the Company's common stock were issued at a
value of $20,000. General and administrative expenses increased when compared to
the same period in 1995.
Liquidity and Capital Resources
There were no recorded revenues for the six months ended December 31, 1996.
For the period from June 30, 1996 through December 31, 1996 the Company's
working capital deficit increased approximately 50% when compared to the period
ended June 30, 1996. At December 31, 1996, the Company maintained a negative
liquidity position which is evidenced by a current ratio of -5.51 to 1. The
Company has no major capital commitments at the present time. Management
continues to review potential acquisition candidates in computer related
technologies in its endeavor to restructure the Company, increase the Company's
current ratio and liquidity, and generate capital which would provide cash flow
for future expansion.
PART II OTHER INFORMATION
Item 6. Reports on Form 8-K
1. On January 13 , 1997, the Company filed a report on Form 8-K to report a
change in control of the Company whereby Alan W. Harvey, President Chairman and
Chief Executive Officer purchased 73,050,000 shares of the Company's Common
Stock. Following the reverse split and conversion of the 73,050,000 shares, Mr.
Harvey holds of record 1,217,500 shares of the Company's Common Stock.
2. On January 22, 1997, the Company filed a report on Form 8-K to report
that the shareholders approved the proposal to recapitalize the Company, and
effect a one-for-sixty reverse split of all issued and outstanding shares of
Common Stock; change the par value of the Common Stock from $.00005 to $.003 per
share; and reduce the number of authorized shares of Common Stock from Five
Hundred Thirty Six Million to Twenty Five Million.
8
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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.
BASIC NATURAL RESOURCES, INC.
Dated: March 11, 1997 By: /s/ Alan W. Harvey
-----------------------
Alan W. Harvey, Chairman, President
and Chief Executive Officer
9
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<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Basic
Natural Resources, Inc. December 31, 1996 financial statements and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000817125
<NAME> Basic Natural Resources, Inc.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> DEC-31-1996
<CASH> 3,652
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,652
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,652
<CURRENT-LIABILITIES> 66,259
<BONDS> 0
0
0
<COMMON> 4,471
<OTHER-SE> (67,078)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 46,050
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (46,050)
<INCOME-TAX> 0
<INCOME-CONTINUING> (46,050)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (46,050)
<EPS-PRIMARY> (.58)
<EPS-DILUTED> (.58)
</TABLE>
