UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
Amendment No. 1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 25, 2015 (September 1, 2015)
Rockdale Resources Corporation |
||
(Exact name of registrant as specified in its charter) |
| Colorado | 000-52690 | 86-1061005 | ||
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
| 710 N. Post Oak Rd., Ste. 512, Houston TX | 77024 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 832-941-0011
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:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
1
EXPLANATORY NOTE
On September 28, 2015, Rockdale Resources Corporation (the “Company”) filed a Current Report on Form 8-K (the “Original Report”) to report, among other things, the closing of the Company’s acquisition of a 10% working interest in the SUDS field located in Creek County Oklahoma, in exchange for 10,586,805 shares of restricted common stock, representing 33% of our then outstanding shares of common stock (collectively, the “Acquired Assets”). At that time, the Company stated in the Original Report that it intended to file the required financial statements and pro forma financial information within 71 days from the date that such report was required to be filed. By this Amendment No. 1 to the Original Report, the Company is amending and restating Item 9.01 thereof to include the required financial statements and pro forma financial information. This Current Report on Form 8-K does not amend or modify the Original Report, except as to Item 9.01.
The title “SUD’s Properties” represents the oil and gas-producing properties included in the Purchase and Sale agreement mentioned in the Original Report. Note that from January 1, 2014 through March 2015, SUD’s Properties were owned by, and the accounting records were included in, Jovian Resources LLC. During this period, Jovian Resources LLC owned additional oil and gas properties (working interests) to the SUDS Properties that were sold to Rockdale Resources Corporation.
2
Item 9.01 Financial Statements And Exhibits.
(a) Financial Statements of Businesses Acquired
The Audited Statements of Direct Revenues and Operating Expenses for the year ended December 31, 2014, and the notes thereto, relating to the Acquired Assets, including the related report of the independent registered public accounting firm, are filed as Exhibit 99.1 to this Form 8-K/A. The Unaudited Statements of Revenues and Direct Expenses for the Six Months ended June 30, 2015, are filed as Exhibit 99.2 to this Form 8-K/A.
(b) Pro Forma Financial Information.
The Unaudited Pro Forma Combined Statement of Operations of Rockdale Resources Corp. for the year ended December 31, 2014 and Unaudited Pro Forma Combined Statements of Operations for the six months ended June 30, 2016, are filed as Exhibit 99.3 to this Form 8-K/A.
(d) Exhibits
| Exhibit No. | Description | |||
| 99.1* | Audited Statements of Revenues and Direct Operating Expenses of the Acquired Assets for the year ended December 31, 2014 and the notes thereto, including the related report of the independent registered public accounting firm. | |||
| 99.2* | Unaudited Statements of Revenues and Direct Operating Expenses of the Acquired Assets for the six months ended June 30, 2015 and the notes thereto. | |||
| 99.3* | Unaudited Pro Forma Combined Statement of Operations of Rockdale Resources Corp. for the year ended December 31, 2014 and Unaudited Pro Forma Combined Statements of Operations for the Six Months Ended June 30, 2015. | |||
* Filed herewith.
3
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 hereunto duly authorized.
| Rockdale Resources Corporation | |||
| By: | /s/ Leo Womack | ||
Leo Womack Chairman |
|||
| Date: August 15, 2016 | |||
4
EXHIBIT INDEX
* Filed herewith.
5
Rockdale Resources Corporation 8-K/A
Exhibit 99.1
ROCKDALE RESOURCES CORPORATION
FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Rockdale Resources Corporation
Houston, TX
We have audited the accompanying statement of revenues and direct operating expenses of SUDS Properties (the “Company”) for the year ended December 31, 2014. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
The accompanying statement of revenues and direct operating statements were prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission as described in Note 2. The presentation is not intended to be a complete presentation of the properties described above.
In our opinion, the financial statement referred to above present fairly, in all material respects, the Revenues and Direct Operating Expenses of the Oil and Gas Properties purchased, as described in Note 1, for the year ended December 31, 2014 in conformity with accounting principles generally accepted in the United States of America.
| /s/ MaloneBailey, LLP | |
| www.malone-bailey.com | |
| Houston, Texas | |
| August 15, 2016 |
SUDS Properties
Statement of Revenues and Direct Operating Expenses
Year ended December 31, 2014
| Oil & Gas Sales | $ | 18,290 | ||
| Direct Operating Expenses | ||||
| Lease Operating Expense | 33,156 | |||
| Production Tax | 1,317 | |||
| Total Direct Operating Expenses | 34,473 | |||
| Excess of direct operating expenses over revenues | $ | (16,183 | ) |
The accompanying notes are an integral part of the statement of revenues and direct operating expenses
SUDS Properties
Notes to Statement of Revenues and Direct Operating Expenses
For the Year Ended December 31, 2014
NOTE 1. THE PROPERTIES
SUDS Properties (“we”, “us”, and the “Company”) was formed for the purpose of oil and gas exploration, development, and production. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”).
Rockdale Resources Corporation (“Rockdale”) acquired a 10% working interest in the SUDS field located in Creek County Oklahoma on September 23, 2015, in exchange for 10,586,805 shares of restricted common stock. Based on the then current market value of our common stock, $0.068 per share, the price paid was $719,903. Concurrently with the purchase, Jovian agreed to assign to Rockdale all rights to be the operator of the SUDS unit under a standard operating agreement.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The statement of revenues and direct operating expenses has been derived from Jovian Petroleum Corporation’s “the Seller” historical financial records and is prepared on the accrual basis of accounting. Revenues and direct operating expenses as set forth in the accompanying statement includes revenues from oil and gas production, net of royalties, and associated direct operating expenses related to the net revenue interest and net working interest, respectively. These revenues and expenses in the SUDS Properties represent Rockdale’s acquired interest. During the periods presented, the Properties were not accounted for or operated as a separate division of the Seller. Accordingly, full separate financial statements prepared in accordance with generally accepted accounting principles do not exist and are not practicable to obtain in these circumstances. This statement varies from an income statement in that it does not show certain expenses, which were incurred in connection with the ownership of the Properties, such as general and administrative expenses, and income taxes. These costs were not separately allocated to the Properties in the Seller’s historical financial records and any pro forma allocation would be both timing consuming and expensive and would not be a reliable estimate of what these costs would actually have been had the Properties been operated historically as a stand alone entity. In addition, these allocations, if made using the historical Seller general and administrative structures and tax burdens, would not produce allocations that would be indicative of the historical performance of the Properties had they been assets of Rockdale, due to the greatly varying size, structure, and operations between Rockdale and the Seller. This statement does not include provisions for depreciation, depletion and amortization as such amounts would not be indicative of future costs and those costs which would be incurred by Rockdale upon allocation of purchase price. Accordingly, the financial statement and other information presented are not indicative of the financial condition or results of operations of the Properties going forward due to the changes in the business and the omission of various operating expenses.
For the same reason, primarily the lack of segregated or easily obtainable reliable data on asset values and related liabilities, a balance sheet is not presented for the Properties.
Management Estimates — The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Oil and Gas Properties — The Company follows the full cost accounting method to account for oil and natural gas properties, whereby costs incurred in the acquisition, exploration and development of oil and gas reserves are capitalized. Such costs include lease acquisition, geological and geophysical activities, rentals on nonproducing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities and asset retirement costs.
Revenue Recognition — Revenues from the sale of crude oil, natural gas, and natural gas liquids are recognized when the product is delivered at a fixed or determinable price, title has transferred; collectability is reasonably assured and evidenced by a contract. The Company follows the sales method of accounting for its oil and natural gas revenue, so it recognizes revenue on all crude oil, natural gas, and natural gas liquids sold to purchasers, regardless of whether the sales are proportionate to its ownership in the property. A receivable or liability is recognized only to the extent that the Company has an imbalance on a specific property greater than the expected remaining proved reserves. The Company had no imbalance positions at December 31, 2014. Charges for gathering and transportation are included in production expenses.
NOTE 3. COMMITMENTS AND CONTINGENCIES
The Company, as a lessee of oil and gas properties, is subject to various federal, state and local laws and regulations relating to discharge of materials into, and protection of, the environment. These laws and regulations may, among other things, impose liability on the Company for the cost of pollution clean-up resulting from operations and subject the Company to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in the affected area. The Company is not aware of any environmental claims existing as of December 31, 2014, which have not been provided for, or covered by insurance or which may have a material impact on its financial position or results of operations. There can be no assurance, however, that current regulatory requirements will not change, or past noncompliance with environmental laws will not be discovered on the Company’s properties.
Rockdale Resources Corporation 8-K/A
Exhibit 99.2
SUDS Properties
Notes to Statement of Revenues and Direct Operating Expenses
For the Six Months Ended June 30, 2015
(unaudited)
| Oil & Gas Sales | $ | 7,947 | ||
| Direct Operating Expenses | ||||
| Lease Operating Expense | 16,270 | |||
| Production Tax | 572 | |||
| Total Operating Expenses | 16,842 | |||
| Excess of direct operating expenses over revenues | $ | (8,895 | ) |
The accompanying notes are an integral part of the unaudited statement of revenues and direct operating expenses
SUDS Properties
Notes to Statement of Revenues and Direct Operating Expenses
For the Six Months Ended June 30, 2015
(unaudited)
NOTE 1. THE PROPERTIES
SUDS Properties (“we”, “us”, and the “Company”) was formed for the purpose of oil and gas exploration, development, and production. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”).
Rockdale Resources Corporation (“Rockdale”) acquired a 10% working interest in the SUDS field located in Creek County Oklahoma on September 23, 2015, in exchange for 10,586,805 shares of restricted common stock. Based on the then current market value of our common stock, $0.068 per share, the price paid was $719,903. Concurrently with the purchase, Jovian agreed to assign to Rockdale all rights to be the operator of the SUDS unit under a standard operating agreement.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The statement of revenues and direct operating expenses has been derived from Jovian Petroleum Corporation’s “the Seller” historical financial records and is prepared on the accrual basis of accounting. Revenues and direct operating expenses as set forth in the accompanying statement includes revenues from oil and gas production, net of royalties, and associated direct operating expenses related to the net revenue interest and net working interest, respectively. These revenues and expenses in the SUDS Properties represent Rockdale’s acquired interest. During the periods presented, the Properties were not accounted for or operated as a separate division of the Seller. Accordingly, full separate financial statements prepared in accordance with generally accepted accounting principles do not exist and are not practicable to obtain in these circumstances. This statement varies from an income statement in that it does not show certain expenses, which were incurred in connection with the ownership of the Properties, such as general and administrative expenses, and income taxes. These costs were not separately allocated to the Properties in the Seller’s historical financial records and any pro forma allocation would be both timing consuming and expensive and would not be a reliable estimate of what these costs would actually have been had the Properties been operated historically as a stand alone entity. In addition, these allocations, if made using the historical Seller general and administrative structures and tax burdens, would not produce allocations that would be indicative of the historical performance of the Properties had they been assets of Rockdale, due to the greatly varying size, structure, and operations between Rockdale and the Seller. This statement does not include provisions for depreciation, depletion and amortization as such amounts would not be indicative of future costs and those costs which would be incurred by Rockdale upon allocation of purchase price. Accordingly, the financial statement and other information presented are not indicative of the financial condition or results of operations of the Properties going forward due to the changes in the business and the omission of various operating expenses.
For the same reason, primarily the lack of segregated or easily obtainable reliable data on asset values and related liabilities, a balance sheet is not presented for the Properties.
Management Estimates — The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Oil and Gas Properties — The Company follows the full cost accounting method to account for oil and natural gas properties, whereby costs incurred in the acquisition, exploration and development of oil and gas reserves are capitalized. Such costs include lease acquisition, geological and geophysical activities, rentals on nonproducing leases, drilling, completing and equipping of oil and gas wells and administrative costs directly attributable to those activities and asset retirement costs.
Revenue Recognition — Revenues from the sale of crude oil, natural gas, and natural gas liquids are recognized when the product is delivered at a fixed or determinable price, title has transferred; collectability is reasonably assured and evidenced by a contract. The Company follows the sales method of accounting for its oil and natural gas revenue, so it recognizes revenue on all crude oil, natural gas, and natural gas liquids sold to purchasers, regardless of whether the sales are proportionate to its ownership in the property. A receivable or liability is recognized only to the extent that the Company has an imbalance on a specific property greater than the expected remaining proved reserves. The Company had no imbalance positions at June 30, 2015. Charges for gathering and transportation are included in production expenses.
NOTE 3. COMMITMENTS AND CONTINGENCIES
The Company, as a lessee of oil and gas properties, is subject to various federal, state and local laws and regulations relating to discharge of materials into, and protection of, the environment. These laws and regulations may, among other things, impose liability on the Company for the cost of pollution clean-up resulting from operations and subject the Company to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in the affected area. The Company is not aware of any environmental claims existing as of June 30, 2015, which have not been provided for, or covered by insurance or which may have a material impact on its financial position or results of operations. There can be no assurance, however, that current regulatory requirements will not change, or past noncompliance with environmental laws will not be discovered on the Company’s properties.
Rockdale Resources Corporation 8-K/A
Exhibit 99.3
Rockdale Resources Corporation
Unaudited Pro-forma Statement of Operations
Year Ended December 31, 2014
| Rockdale Resources | SUDS Properties | Combined | ||||||||||
| Oil and gas sales | $ | 683,536 | $ | 24,066 | 707,602 | |||||||
| Operating expenses | ||||||||||||
| Lease operating expense | 290,557 | 33,156 | 323,713 | |||||||||
| Production tax | 29,748 | 1,733 | 31,481 | |||||||||
| General and administrative expenses | 1,756,668 | — | 1,756,668 | |||||||||
| Depreciation, depletion and amortization | 165,943 | — | 165,943 | |||||||||
| Asset retirement obligation | 1,872 | — | 1,872 | |||||||||
| Total operating expenses | 2,244,788 | 34,889 | 2,279,677 | |||||||||
| Loss from operations | (1,561,252 | ) | (10,823 | ) | (1,572,075 | ) | ||||||
| Interest (expense) | (113,281 | ) | — | (113,281 | ) | |||||||
| Net loss | $ | (1,674,533 | ) | $ | (10,823 | ) | (1,685,356 | ) | ||||
Rockdale Resources Corporation
Unaudited Pro-forma Statement of Operations
Six Months Ended June 30, 2015
(unaudited)
| Rockdale Resources | SUDS Properties | Combined | ||||||||||
| Oil and gas sales | $ | 128,159 | $ | 10,456 | 138,615 | |||||||
| Operating expenses | ||||||||||||
| Lease operating expense | 134,054 | 16,270 | 150,324 | |||||||||
| Production tax | 5,917 | 753 | 6,670 | |||||||||
| General and administrative expenses | 243,482 | — | 243,482 | |||||||||
| Depreciation, depletion and amortization | 59,210 | — | 59,210 | |||||||||
| Impairment of oil & gas properties | 668,073 | — | 668,073 | |||||||||
| Total operating expenses | 1,110,736 | 17,023 | 1,127,759 | |||||||||
| Loss from operations | (982,577 | ) | (6,567 | ) | (989,144 | ) | ||||||
| Interest expense | (88,030 | ) | — | (88,030 | ) | |||||||
| Loss on conversion of debt | (69,107 | ) | — | (69,107 | ) | |||||||
| Other income | 8,484 | — | 8,484 | |||||||||
| Net loss | $ | (1,131,230 | ) | $ | (6,567 | ) | (1,137,797 | ) | ||||