UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Amendment No. 1)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2012
Commission File Number: 0-12214
| DALECO RESOURCES CORPORATION | |
| (Exact name of registrant as specified in its charter) | |
| Nevada | 23-2860734 |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
17 Wilmont Mews, 5thFloor West Chester, Pennsylvania 19382 (Address of principal executive offices) (Zip Code) | (610) 429-0181 (Registrant’s telephone number, including are code)
|
| Securities registered under Section 12(b) of the Act: None | |
| Securities registered under Section 12(g) of the Act: | |
| Title of each class | |
| Common Shares, Par Value $.01 | |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes¨Nox
Indicate by check mark if the registrant is not required to file reports pursuant toSection 13 or 15 (d) of the Act. Yes¨Nox
Indicate by check mark whether the issuer (1) 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. YesxNo¨ Other than this Form 10-K.
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).YesxNo¨
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.¨
| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. | |||||
| Large accelerated filer¨ | Accelerated filer¨ | Non-accelerated filer¨ | Smaller reporting companyx | ||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes¨Nox
The aggregate market value of the voting and non-voting common equity held by non-affiliates on March 31, 2012, was approximately $6,900,000. This amount is based on the average bid and asked price of the Registrant’s common stock on the NASDAQ Over the Counter Market, Bulletin Board ("OTCBB") on that date. Shares of common stock beneficially held by executive officers and directors of the Registrant are not included in the computation. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
49,441,058 common shares, $0.01 par value, were outstanding on December 31, 2012.
DOCUMENTS INCORPORATED BY REFERENCE - None.
EXPLANATORY NOTE -The Registrant hereby amends Registrant’s Annual Report on Form 10-K for the year ended September 30, 2012 (the “Original Form 10-K”). This Amendment No. 1 on Form 10-K/A to the Original Form 10-K is being filed to amend the quantities of Mineralized Materials disclosed in the Zeolite and Kaolin sub-sections of the Mineralized Materials section of Item 1 on pages 9 and 10 of the Original Form 10-K . Exhibits 31.1, 31.2 and 32.1 are hereby amended and filed herewith. No information included in the Original Form 10-K has been amended by this Form 10-K/A to reflect any information or events subsequent to the filing of the Original Form 10-K.
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DALECO RESOURCES CORPORATION
FORM 10-K (Amendment No.1)
FOR THE YEAR ENDED SEPTEMBER 30, 2012
TABLE OF CONTENTS
| PART I | |||
| Item 1. | Business | 4 | |
| PART IV | 14 | ||
| Item 15. | Exhibits, Financial Statement Schedules | ||
| SIGNATURES | 18 | ||
| 2 |
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
Some of the information, including all of the estimates and assumptions, in this report contain forward-looking statements within the meaning of Sections 27A of the Securities Act of 1933, as amended, and 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included in this report, including, but not limited to, statements regarding our future financial position, business strategy, budgets, projected costs, savings and plans, objectives of management for future operations, legal strategies, and legal proceedings, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, or “continue” or the negative thereof or variations thereon or similar terminology.Except for statements of historical or present facts, all other statements contained in this report are forward-looking statements. The forward-looking statements may appear in a number of places and include statements with respect to, among other things: business objectives and strategic plans; operating strategies; acquisition strategies; drilling wells; oil and gas reserve estimates (including estimates of future net revenues associated with such reserves and the present value of such future net revenues); estimates of future production of oil, natural gas and minerals; expected results or benefits associated with recent acquisitions; marketing of oil, gas and minerals; expected future revenues and earnings, and results of operations; future capital, development and exploration expenditures; expectations regarding cash flow and future borrowings sufficient to fund ongoing operations and debt service, capital expenditures and working capital requirements; nonpayment of dividends; expectations regarding competition; impact of the adoption of new accounting standards and the Company’s financial and accounting systems; and effectiveness of the Company’s control over financial reporting.
These forward-looking statements are subject to numerous assumptions, risks, and uncertainties. Factors that may cause our actual results, performance, or achievements to be materially different from those anticipated in forward-looking statements include, among others, the following:
| • | adverse economic conditions in the United States and globally; | ||
| • | difficult and adverse conditions in the domestic and global capital and credit markets; | ||
| • | domestic and global demand for oil and natural gas and non-metallic minerals; | ||
| • | volatility of the market prices for crude oil and natural gas and non-metallic minerals; | ||
| • | the effects of government regulation, permitting, and other legal requirements; | ||
| • | the geologic quality of our properties with regard to, among other things, the existence of non-metallic minerals and hydrocarbons in economic quantities; | ||
| • | uncertainties about the estimates of our oil and natural gas reserves and our non-metallic mineral resources; | ||
| • | our ability to increase our production and oil and natural gas income and non-metallic mineral sales through exploration and development; | ||
| • | our ability to successfully apply horizontal drilling techniques and tertiary recovery methods; | ||
| • | the number of well locations to be drilled, the cost to drill, and the time frame within which they will be drilled; | ||
| • | the effects of adverse weather on operations; | ||
| • | drilling and operating risks; | ||
| • | the availability of equipment, such as drilling rigs, transportation pipelines and mining equipment; | ||
| • | changes in our oil and gas drilling and minerals development plans and related budgets; | ||
| • | the adequacy of our capital resources and liquidity including, but not limited to, access to additional borrowing capacity; | ||
| uncertainties associated with environmental matters and permitting and other regulations affecting our operations and planned activities; and | |||
| • | uncertainties associated with our legal proceedings and their outcome. |
Because forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such statements. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of the respective document. Other unknown or unpredictable factors may cause actual results to differ materially from those projected by the forward-looking statements. Most of these factors are difficult to anticipate and may be beyond our control. Unless otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.
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PART I
Item 1. Business.
General
Daleco Resources Corporation (the “Company”) is a Nevada corporation and its Articles provide for authorized capital stock of 100,000,000 shares of common stock and 20,000,000 shares of preferred stock.The Company's assets consist of two separate categories: oil and natural gas and non-metallic minerals. The Company is a natural resources holding company whose subsidiaries are engaged in: (i) the exploration, development and production of oil and gas; (ii) the exploration for naturally occurring minerals; (iii) the marketing and sales of such minerals; and (iv) the marketing and sales of products utilizing the Company’s minerals. The Company’s wholly-owned subsidiaries include Westlands Resources Corporation, Deven Resources, Inc., DRI Operating Company, Inc., Deerlick Royalty Partners I, Tri-Coastal Energy, Inc., Clean Age Minerals, Inc., CA Properties, Inc., Sustainable Forest Industries, Inc. and The Natural Resources Exchange, Inc.
Tri-Coastal Energy, Inc., Sustainable Forest Industries, Inc. and The Natural Resources Exchange, Inc. are inactive.
All of the Company’s oil and gas properties are located onshore within the continental United States of America. The Company, through its wholly-owned subsidiaries, Westland Resources Corporation, DRI Operating Company and Deven Resources, Inc., owns and operates oil and gas properties located in Pennsylvania, Texas and West Virginia. The Company owns overriding royalty interests in (i) two wells in Pennsylvania and (ii) one well in Texas. The Company does not own working interests in the wells located in Pennsylvania that it operates.
The Company does not refine any crude oil or market, at retail, any oil or petroleum products. The Company does not own any drilling rigs. All of its drilling activities are performed by independent drilling contractors on a contract basis.
Deven Resources, Inc. (“DRI”) is the managing general partner of Deerlick Royalty Partners I, a Pennsylvania general partnership, which owns overriding royalty interests in seventy wells in the Deerlick Coalbed Methane Field located in Tuscaloosa County, Alabama. DRI is also the sole shareholder of DRI Operating Company which operates wells and has oil and gas interests in West Virginia and Pennsylvania.
As of September 30, 2012, the Company owned working interests in 28 wells in Texas and West Virginia. Throughout the twelve month period beginning October 1, 2011 and ending September 30, 2012, the Company has experienced an average decrease of 5% in the unit of production weighted average sales price it received for its oil and natural gas products as compared to the twelve month period beginning October 1, 2010 and ending September 30, 2011.
Clean Age Minerals, Inc., through its wholly-owned subsidiary, CA Properties, Inc. (collectively “CAMI”), owns a fee title interest, leasehold interest and Federal Placer and Lode mining claims containing non-metallic and other minerals in Texas, New Mexico and Utah. CAMI is presently engaged in the exploration for such minerals. CAMI intends to mine the minerals through the use of contract miners and arrangements with its joint venture partner.
In February 2010, the Company entered into a License Agreement concerning two US method patents for the treatment of sanitary wastewaters. Such patents utilize the Company’s zeolite. The license applies to the US and covers the use of the technology in water, wastewater and waste treatment in animal feed operations, agriculture, and aquaculture. In addition, the license applies to the treatment of sanitary wastewater on Federal facilities, military bases and lands administered by the US Bureau of Indian Affairs.
OIL AND NATURAL GAS
Beginning at page 89 of this report, a glossary of oil and natural gas terms used throughout this report is included. See Item 8 of Part II for additional information relating to the oil and natural gas activities of the Company.
Property Acquisition and Disposition
During fiscal 2012, the Company acquired certain working interests in its operated properties in Texas. During fiscal 2012, the Company sold certain oil and natural gas leasehold deep rights for cash of $898,335. The oil and natural gas leasehold deep rights that were sold were undeveloped, and as such not income-producing to the Company. During fiscal 2011, the Company did not acquire any oil and gas properties or drilling prospects. Within the oil and gas sector, the Company faces competition from entities possessing substantially larger financial resources and staffs. The demand for domestically produced oil and natural gas should remain at the current levels in the foreseeable future especially in light of worldwide demand, the turmoil in the Middle East, decreased production from Central America and political instability in South America. Domestic and increasing world demands, especially in the Pacific Basin, for crude oil and natural gas will continue to increase.
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The domestic oil industry is subject to the fluctuations inherent in the global energy industry. Natural gas and crude oil prices have fluctuated on the spot market and each is a commodity traded on the mercantile exchange. However, most of the Company’s products (natural gas and crude oil) are sold under contracts that provide the Company with competitive pricing within its operating areas. While the demand for domestic natural gas remains favorable, the ongoing development of shale gas resources plays has significantly increased the available domestic natural gas supplies. In response, the price received for natural gas has declined within the existing domestic markets. Alternative markets and uses for natural gas are being developed and such should have a favorable impact on the demand for and the stabilization of natural gas prices with the United States.
During fiscal 2013, the Company intends to continue to focus on: (i) identifying niche acquisition and developmental opportunities within the oil and gas sector that can be economically exploited, and (ii) identifying third parties who will, either individually or in conjunction with the Company, develop certain of the Company’s leasehold interests.
Marketing and Production of Oil and Gas, Delivery Commitment
The Company does not refine or engage in retail sales of any petroleum products. All of its production is sold, at the wellhead, to a variety of customers, which include pipelines, oil and natural gas gathering firms and other purchasers, pursuant to written agreements. Sales of oil and natural gas are customarily made at prevailing market prices or tied to a benchmark price under long-term contracts. Typically, oil purchase agreements are of short duration and provide for market sensitive pricing. Natural gas contracts are of a longer duration. The Company is a party to two long-term natural gas sales contracts which contain provisions concerning annual price adjustments and two contracts that renew annually. The Company is not obligated to provide a fixed and determinable quantity of oil and/or natural gas under existing contracts or agreements.
The availability of a market for oil and natural gas produced from the properties of the Company and prices received are dependent upon numerous factors, substantially all of which are beyond the control of the Company. Such factors include the level of domestic production, the availability of imported oil and gas, actions taken by foreign producing nations, the availability of distribution and transportation facilities and capacity thereon, the availability and price of fuels competitive with oil and gas, world and domestic demand for oil and gas and refined products, governmental regulations, environmental restrictions, drilling moratoriums and taxation. Such factors make it impracticable to predict with any degree of certainty future demand for or prices of the oil or gas produced by the Company.
Production of oil and gas is generally not considered to be of a seasonal nature, although severe weather conditions can temporarily curtail or preclude producing activities. Demand for natural gas is fairly constant over the entire year as a result of the increased demand for natural gas to fuel electric power generation and other commercial uses. Gas production from certain wells operated by the Company in West Virginia has been curtailed occasionally by the transporting pipeline. The Company has never experienced any other difficulties in selling any of its oil or gas.
Customers
The following table identifies the Company’s customers who purchased in excess of five percent (5%) of the Company’s oil and natural gas during the fiscal year ended September 30, 2012:
| Name and Location of Purchaser | Percentage | ||
| ETC Texas Pipeline, Ltd.(1) | San Antonio, Texas | 27% | |
| GulfMark Energy, Inc. | Houston, Texas | 45% | |
| Sheridan Production Company LLC | Houston, TX | 16% | |
| Volunteer Energy Services, Inc. | Pickerington, Ohio | 10% | |
| (1) | The Company’s production of natural gas from its operated wells in the Giddings Field, Texas, is sold to ETC Texas Pipeline, Ltd. pursuant to a long standing contract expiring January 31, 2014, with an annual renewal provision which covers a number of the Company’s Texas leases. Subject to various conditions, ETC has agreed to buy all of the Company’s natural gas produced from the Giddings Field. The Company receives eighty percent (80%) of the weighted average monthly sales price for liquid products extracted from natural gas delivered to ETC and eighty percent (80%) of the resale prices for dry residual gas. Prices received by the Company are subject to deductions for taxes, compression and similar charges. |
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The Company does not believe that the loss of any one of these customers would have a material adverse effect upon the Company’s revenues since there are numerous purchasers of oil and natural gas in the areas in which the Company operates.
Production
Substantially all the Company’s production of oil and natural gas in Texas is attributable to the Giddings Field located in the Austin Chalk Trend (see Item 2 – Properties) which represented 72% and 66% of total oil and gas production on an MCFE basis for fiscal 2012 and 2011, respectively. All the Company’s production of natural gas in West Virginia is attributable to the Oriskany formation of the Appalachian Basin’s Upper Devonian Section which represented 28% and 34% of total oil and natural gas production on an MCFE basis for fiscal 2012 and 2011, respectively.
The following table summarizes the Company’s net oil and natural gas production for the periods indicated, shown in barrels (“Bbls”) and, thousand cubic feet (“Mcf”):
| Fiscal Year Ended September 30 | ||||||||
| 2012 | 2011 | |||||||
| Texas: | ||||||||
| Oil (Bbls) | 2,112 | 1,711 | ||||||
| Gas (Mcf) | 21,281 | 18,520 | ||||||
| Average Bbls/day | 6 | 5 | ||||||
| Average Mcf/day | 58 | 51 | ||||||
| Pennsylvania: | ||||||||
| Gas (Mcf) | 192 | 25 | ||||||
| Average Mcf/day | 1 | - | ||||||
| West Virginia: | ||||||||
| Gas (Mcf) | 12,931 | 14,534 | ||||||
| Average Mcf/day | 36 | 40 | ||||||
| TOTALS: | ||||||||
| Oil (Bbls) | 2,112 | 1,711 | ||||||
| Gas (Mcf) | 34,404 | 33,079 | ||||||
| Average Bbls/day | 6 | 5 | ||||||
| Average Mcf/day | 96 | 91 | ||||||
The following table summarizes for the periods indicated the average price per barrel (“Bbl”) of oil, the average price per thousand cubic feet (“Mcf”) of natural gas and average sales price and production costs per gas equivalent. In determining the prices received by the Company, the revenues are attributed to the Company’s net revenue interests. Production costs incurred by the Company include expenses of operation attributable to the Company’s working interests. For the purpose of determining Mcf equivalents (“MCFE”), one Bbl of oil has been converted to gas equivalents at the rate of one Bbl per six Mcf.
| Fiscal Year Ended September 30 | ||||||||
| 2012 | 2011 | |||||||
| Texas | ||||||||
| Average Sale Price Per Bbl | $ | 95.67 | $ | 89.87 | ||||
| Average Sale Price Per Mcf | $ | 6.08 | $ | 7.60 | ||||
| Pennsylvania | ||||||||
| Average Sale Price Per Mcf | $ | 3.17 | $ | 4.96 | ||||
| West Virginia | ||||||||
| Average Sale Price Per Mcf | $ | 3.26 | $ | 4.48 | ||||
| Combined Properties | ||||||||
| Average Sale Price Per Bbl | $ | 95.67 | $ | 89.87 | ||||
| Average Sale Price Per Mcf | $ | 4.98 | $ | 6.28 | ||||
| Average Sale Price Per MCFE | $ | 7.93 | $ | 8.34 | ||||
| Average Production Costs per MCFE | $ | 3.87 | $ | 3.60 | ||||
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Drilling Activity
The Company did not participate in the drilling of any exploratory or development wells in fiscal 2012 or 2011. Such information should not be considered indicative of future performance or prospects of the Company. There is no necessary correlation between the number of producing wells, whether developmental or exploratory, completed during any period and the aggregate reserves or future net income generated.
Wells and Acreage
The Company owns no Undeveloped Acreage at September 30, 2012 and 2011. Certain of the Developed Acreage owned by the Company are limited as to depths and/or formations. The following tables set forth certain information as of September 30, 2012 and 2011:
| 2012 | 2011 | |||||||||||||||
| Well Count | Gross Wells | Net Wells | Gross Wells | Net Wells | ||||||||||||
| Texas | 26 | 12.26 | 26 | 9.40 | ||||||||||||
| West Virginia | 2 | 0.46 | 2 | 0.46 | ||||||||||||
| Total | 28 | 12.72 | 28 | 9.86 | ||||||||||||
| Developed Acreage | Gross Acres | Net Acres | Gross Acres | Net Acres | ||||||||||||
| Texas | 5,069 | 2,365 | 5,069 | 1,813 | ||||||||||||
| Pennsylvania | 382 | 382 | 382 | 382 | ||||||||||||
| West Virginia | 1,777 | 432 | 1,777 | 432 | ||||||||||||
| Total | 7,228 | 3,179 | 7,228 | 2,627 | ||||||||||||
Proved Reserves
The Company causes to be prepared an annual estimate of its proved oil and gas reserves. These estimates are prepared by an independent consultant in a manner consistent with generally accepted procedures for such estimates. Proved developed reserves are estimated utilizing available data including but not limited to, the wells’ geologic information, operating performance and the prevailing market conditions.
The Company has not filed reserve estimates with any United States authority or agency, other than estimates previously filed with the Securities and Exchange Commission. The following tables set forth the net proved developed reserves of the Company as of September 30, 2012 and 2011. All of the reserves are located on-shore within the United States.
Proved reserve estimates for the Company’s properties as of September 30, 2012 and 2011 were taken from reserve reports dated January 7, 2013 and February 2, 2012, respectively, prepared by Hall Energy, Inc. of Magnetic Springs, Ohio, with the figures utilizing constant product prices in accordance with reporting requirements. Hall Energy, Inc. is an independent petroleum engineering concern with an emphasis in the Appalachian and Ohio Basins.
| September 30 | ||||||||
| 2012 | 2011 | |||||||
| Net Proved Developed Reserves: | ||||||||
| Oil (Bbls) | ||||||||
| Texas | 26,736 | 34,149 | ||||||
| Gas (Mcf) | ||||||||
| Texas | 151,605 | 154,048 | ||||||
| Alabama(1) | 105,141 | - | ||||||
| Pennsylvania | 599 | - | ||||||
| West Virginia | 177,036 | 188,814 | ||||||
| Total | 434,381 | 342,862 | ||||||
Substantially all the Company’s proved reserves in Texas are attributable to the Giddings Field located in the Austin Chalk Trend (see Item 2 – Properties) which represented 52% and 66% of total net proved developed reserves on an MCFE basis at September 30, 2012 and 2011, respectively. All the Company’s proved reserves in West Virginia are attributable to the Oriskany formation of the Appalachian Basin’s Upper Devonian Section which represented 30% and 34% of total net proved developed reserves on an MCFE basis at September 30, 2012 and 2011, respectively. All the Company’s proved reserves in Alabama are attributable to the Deerlick Coalbed Methane Field located in Tuscaloosa County, Alabama, which represented 18% of total net proved developed reserves on an MCFE basis at September 30, 2012. The Company did not estimate reserves at September 30, 2011, for its interest in the Deerlick Coalbed Methane Field.
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The Company has identified fifteen (15) potential development and redevelopment opportunities associated with its existing leasehold acreage inthe Giddings Field located in the Austin Chalk Trend. The Company believes that the potential for the development of such locations will occur within the next few years as a result of renewed interest in the area of its properties. The prevailing oil price and the development of properties in “resource plays” in the area of the Company’s acreage are major factors contributing to such interest. At September 30, 2012, the Company has assigned probable and possible reserves to the fifteen (15) potential developmental locations.
Estimated Future Net Revenues and Present Worth
Estimated future net revenues of the Company’s proved net oil and gas reserves at the date indicated and the present worth thereof employing a ten percent (10%) discount factor is set forth in the following tabulation:
| September 30 | ||||||||
| 2012 | 2011 | |||||||
| Future Net Revenues : | ||||||||
| Proved Developed Oil and Gas Reserves | $ | 2,669,449 | $ | 3,369,816 | ||||
| Proved Undeveloped Oil and Gas Reserves | $ | - | $ | - | ||||
| Total Proved Oil and Gas Reserves | $ | 2,669,449 | $ | 3,369,816 | ||||
| Present Worth: | ||||||||
| Proved Developed Oil and Gas Reserves | $ | 1,792,312 | $ | 2,206,666 | ||||
| Proved Undeveloped Oil and Gas Reserves | $ | - | $ | - | ||||
| Total Proved Oil and Gas Reserves | $ | 1,792,312 | $ | 2,206,666 | ||||
The present value of estimated future net revenues set forth above is computed using the estimated future net revenues and a discount factor of ten percent (10%) over the projected life of each property.
Petroleum engineering is not an exact science. Information relating to the Company’s oil and gas reserves is based upon engineering estimates. Estimates of economically recoverable oil and gas reserves and of the future net revenues therefrom are based upon a number of variable factors and assumptions, such as historical production from the subject properties compared with production from other producing properties, the assumed effects of regulation by governmental agencies and assumptions concerning future oil and gas prices and future operating costs, severance and excise taxes, development costs, work-over and remedial costs, all of which may in fact vary from actual results. All such estimates are to some degree speculative, and classifications of reserves are only attempts to define the degree of speculation involved. For these reasons, estimates of the economically recoverable reserves of oil and gas attributable to any particular group of properties, classifications of such reserves based on risk of recovery and estimates of the future net revenues expected therefrom, prepared by different engineers or by the same engineers at different times, may vary. The Company emphasizes that the actual production, revenues, severance and excise taxes, development expenditures and operating expenditures with respect to its reserves will likely vary from such estimates, and such variances may be material. Persons should not assume that the estimates of the Company's future reserves are a guaranteed figure.
The present values shown above should not be construed as the current market value of the estimated oil and gas reserves attributable to the Company’s properties. In accordance with applicable requirements of the Securities and Exchange Commission, the estimated discounted future net revenues from proved reserves are based, generally, on prices and costs as of the date of the estimate, whereas actual future prices and costs may be materially higher or lower. Actual future net revenues also will be affected by factors such as actual production, supply and demand for oil and gas, curtailments or increases in consumption by gas purchasers, changes in governmental regulations or taxation, the impact of inflation on operating costs, general and administrative costs and interest expense.Estimated future production is priced at the average price received for fiscal 2012 for the amounts at September 30, 2012 and the average price received for fiscal 2011 for amounts at September 30, 2011. The method of calculating the estimated product prices is in accordance with the reserve estimation and disclosure requirements of ASC Topic 932, Extractive Industries – Oil and Gas which the Company adopted on September 30, 2010.The timing of actual future net revenues from proved reserves, and thus their actual present value, will be affected by the timing of the incurrence of expenses in connection with development of oil and gas properties. In addition, the ten percent (10%) discount factor, which is required by the Commission to be used to calculate discounted future net revenues for reporting purposes, is not necessarily the most appropriate discount factor based on interest rates in effect from time to time and risks associated with the oil and gas industry. Discounted future net revenues, no matter what discount rate is used, are materially affected by assumptions as to the timing of future production and future expenses which may and often do prove to be inaccurate.
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Reserves Reported To Other Agencies
There were no estimates or reserve reports of the Company’s proved domestic net oil or gas reserves filed with any governmental authority or agency other than the Securities and Exchange Commission during the fiscal years ended September 30, 2012 and 2011.
MINERAL INTERESTS
Beginning at page 92 of this report, a glossary of minerals and mining terms used throughout this report is included. See Item 8 of Part II for additional information relating to the minerals activities of the Company.
General
The mining and marketing of non-metallic industrial minerals is highly competitive; however, the Company believes that the locations and quality of its mineral deposits will benefit its future development and sales efforts. By definition, the Company is an Exploration Stage entity in respect to its mineral holdings. In 2005, the Company contracted Denali Enterprises to review available technical data associated with the quantification of the mineral deposits in connection with the Company’s exploration efforts. Such review reaffirmed the existence of sufficient mineral deposits to continue with such efforts. The Company’s ability to develop these mineral deposits is dependent on its success in bringing in strategic partners with experience in or a demand for specific minerals and raising capital through third parties. In June 2007, the Company and Tecumseh Professional Associates, Inc. (“TPA”) entered into a Restated Development and Operating Agreement in respect to the Sierra Kaolin deposit. Under the Restated Development and Operating Agreement the Company and TPA continued the evaluation of the Sierra Kaolin (See “Kaolin” below). Independently, the Company has continued the evaluation of its zeolite properties. The Company continues to sell raw zeolite to third parties as animal feed supplement and for other uses, and market its zeolite based products such as its ReNuGen™, a product utilized in wastewater treatment applications. At September 30, 2012, the Company was and continues to be involved in discussions with one or more potential joint venture partners for the development and testing of additional zeolite based products and to provide capital for market introduction.
MineralExtraction
The Company has not established large-scale production of any of its mineral deposits. The Company's mineral extraction is conducted by third party contractors engaged by CAMI or its joint venture partners. The Company does not conduct any direct extraction activities of its own. As such, the Company is subject to “pass through” costs for the extraction, crushing or preparation of its minerals. Likewise, the third party operator is solely responsible for the type of equipment utilized on each mineral site, subject to the third party contractor’s compliance with all Federal, state and local laws, regulations and ordinances for the conduct of operations, environmental protection and safety of operations.
Mineralized Materials
Set forth below are the total gross acres, gross acres evaluated and estimated gross quantities of Mineralized Materials associated with the gross acres evaluated for the Company’s kaolin claims in Sierra County, New Mexico, zeolite lease and fee acreage in Presidio County, Texas, and zeolite claims in Beaver County, Utah. These Mineralized Materials were evaluated and estimated by a Competent Person.
| State | Mineral | Total Gross Acres |
Gross Acres | Gross Mineralized Materials (millions of tons) | ||||
| New Mexico | Kaolin | 2,720 | 264 | 38.0 | ||||
| Texas | Zeolite | 5,200 | 438 | 54.8 | ||||
| Utah | Zeolite | 220 | - | - |
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Zeolite
Texas - Through September 30, 2012, the Company mined approximately 1,300 tons of material for the preparation of samples and test products. Approximately 100 tons have been sold or distributed as the Company’s trademarked ReNuGen™, a zeolite based, wastewater treatment product. During fiscal 2011 and 2010, approximately 80 and 120 tons, respectively, were sold for use in certain agricultural oriented products. The Company has also provided material for various environmental testing and waste purification projects and currently has approximately 1,000 tons available for product processing. During fiscal 2006, the Company initiated a confirmation geologic field mapping project and commenced a resource definition program, as well as a core hole drilling and sampling program to delineate Mineralized Materials in sufficient quantities to support large scale mining operations. These efforts targeted 438 acres of the 5,200 acres held by the Company which are most likely to be subjected to initial development. During fiscal 2007, Krumrey Industrial Minerals, LLC, formerly known as KT Minerals, Inc. (“KIM”), completed the evaluation of the target area. KIM has identified 54.8 million tons of Mineralized Materials associated with the target area. At September 30, 2012, the Company is also exploring alternatives for the development and marketing of additional zeolite based products for introduction into the industrial and environmental markets.
Utah – As of September 30, 2012, the Company is not conducting any exploration activities on the Three Creek zeolite deposit.
Kaolin
The Company has 17 Federal Placer mining claims covering approximately 2,720 acres and 8 Lode claims covering approximately 160 acres covering a portion of its existing holdings. The Company has maintained all of its claims during fiscal 2012. Through September 30, 2012, the Company has not produced commercial quantities of its Sierra Kaolin. Sierra Kaolin was mined in previous years for testing by prospective customers.
Under its Revised and Restated Agreement with TPA, the pre-development evaluation program of the Company’s Sierra Kaolin claims was completed during fiscal year 2010. This program focused on evaluating in detail approximately 173 acres (+/-7%) of the Company’s 2,720 acre mineral claim block which is most likely to be subjected to initial development. During fiscal 2008, KT Minerals, Inc. identified 38.0 million tons of Mineralized Materials based on a total of 53 verifiable drill holes representing 6,310 feet of subsurface material.
In 1965, twenty core holes were drilled which produced 3,087 feet of core samples. In 1976, 17 core holes were drilled which produced 1,784 feet of core samples. During fiscal 2005, 16 core holes were drilled on a 32 acre area from which 1,442 feet of subsurface material was recovered. During fiscal year 2006, this subsurface material was broken down into over 600 samples which were subjected to detailed testing at three different laboratories. The testing phase of the project included roughly 20,000 tests which now comprise an extensive Sierra Kaolin data base. This data base was then utilized by the consulting firm of Pincock, Allen & Holt to develop detailed geologic models of the Sierra Kaolin deposit test area. Based on this work, it was determined that this 32 acre core tested area contained approximately 1.4 million tons of Mineralized Materials.
KIM conducted a re-evaluation of the potential Kaolin Mineralized Materials associated with the project. The KIM re-evaluation considered the geologic and compositional data available from prior studies and incorporated the results of the mineral processing study completed by Ginn Mineral Technology, Inc. (“GMT”). Based on the GMT study a greater percentage of the project’s in situ minerals could be processed into marketable material as compared to prior indications. In addition, KIM evaluated and expanded the study area outside of the 32 acres encompassed by the TPA coring program to include acreage penetrated by an additional 53 historical core holes from which verifiable data could be obtained. As a result, KIM evaluated approximately 264 acres of the project and identified approximately 38.0 million tons of Mineralized Materials.
During fiscal 2011 and 2012, TPA proceeded with the next phase of the project which included: (i) further work to quantify Mineralized Materials; (ii) product identification and development; (iii) preparation of detail process flow sheets; and, (iv) establishment of equipment specifications, as well as marketing and capital requirements. In December 2009, the Sierra Kaolin Open Pit Clay Mine project cleared the regulatory review and the project’s definitive USDA Forest Service Plan of Operations was approved. This will facilitate the project moving to the next phase. These activities will continue in fiscal 2013.
Marketing of Minerals and Marketing Agreements
In December 2004, the Company entered into a Memorandum of Understanding for development ofSierra Kaolin Deposit (“MOU”) with TPA for the management, development, exploration and marketing of the Company’s Sierra Kaolin claims, located in Sierra County, New Mexico (see Exhibit 10.9).
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Under the Company’s March 11, 2005 and June 7, 2007 agreements with TPA (see Exhibits 10.12 and 10.17, respectively), TPA has assumed the duties to mine, test, exploit, and market the Company’s Sierra Kaolin deposit.
Management of the Company directs the activities pertaining to the Company’s zeolite minerals and participates in the decisions regarding the agreement with TPA in respect to the marketing of its Sierra Kaolin.
Government Regulations
Oil and Natural Gas
There are statutory and/or regulatory provisions regulating the Company’s oil and natural gas operations. These statutes allow administrative agencies to promulgate regulations in connection with the development, production and sale of oil and natural gas, and to establish allowable rates of production.
The Company’s activities are subject to laws and regulations relating to environmental quality and pollution control. Although the cost of compliance with such legislation and regulations has not been material to date, such laws and regulations could substantially increase the cost of carrying on these activities and could prevent or delay the commencement or continuance of a given operation. The Company believes that existing legislation and regulations have had no material adverse effect on its present method of operations. In the future, Federal, state and local environmental controls may require the Company to make significant expenditures, but neither the probability nor the magnitude of the expenditures, if any, can be predicted.
The discharge of oil, natural gas or the by-products of drilling, reworking and producing oil and natural gas into the air, soil or water may give rise to potential liabilities for the restoration of the environment and to third parties. A variety of Federal and state laws and regulations govern the environmental aspects of the production, transportation and processing of hydrocarbons and may, in addition to other laws and regulations, impose liability in the event of a discharge or seepage (whether or not accidental). Compliance with such laws and regulations could increase the cost of the exploration, production and development of oil and natural gas reserves. The Company does not currently anticipate that compliance will have a material adverse effect on the ability of the Company to continue in the exploration, development or production of its existing reserves and the development and/or acquisition of new reserves.
The Company does not believe that its environmental risks are materially different from those of comparable companies in the oil and gas industry. The Company believes that it is in substantial compliance with all existing rules and regulations. No assurance can be given, however, that environmental laws will not, in the future, result in more onerous regulations causing a marked increase in the cost of production, development and exploration or otherwise adversely affect the Company’s operations or financial ability to maintain its existing reserves. Although the Company maintains insurance coverage for certain liabilities, to include insurance to cover specific environmental risks, such as seepage or discharge, other environmental risks may not be fully insurable.
Mineral Interests
The Company’s activities are subject to Federal and state laws and regulations relating to environmental quality and pollution control, safety rules as prescribed by Occupational Safety and Health Administration, and the provisions of the 1872 Mining Law and the 1976 Federal Land Policy Management Act. At present, the Company does not intend to engage in mining activities on its own. The Company intends to retain, and has to date retained, the services of outside contractors to carry out such activities (see the agreements with TPA as set forth as Exhibits 10.9, 10.12 and 10.17). The Company believes that such practices will result in substantial savings in the future. The Company’s mineral interests in New Mexico (kaolin) and Utah (zeolite) are on Federal lands. As such, the Company must also comply with the rules and regulations imposed for the development of Federal mining claims. The Marfa zeolite property in Texas is on fee and leased acreage and is subject to Federal and state laws and regulations governing open pit extraction.
Transportation
Oil and Gas
Currently the majority of the Company’s natural gas is sold to interstate carriers. The Company moves its gas to the interstate carriers over a gathering system owned by the Company or joint venture partners in the Company's wells. The Company has experienced no difficulty in moving or selling its gas. The Company is not a regulated interstate/intrastate carrier of natural gas and as such it is not a regulated pipeline under the National Gas Policy Act of 1983, the National Gas Act of 1938 or as a common carrier by applicable state agencies.
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Mineral Interests
All of the Company’s mineral deposits are serviced by all-weather paved or unpaved roads. The Marfa zeolite property in Texas is adjacent to a railroad line that can be utilized to transport minerals to market. The Utah zeolite and New Mexico Sierra Kaolin deposits also have access to rail lines but will require over-land transport prior to rail transport.
Partnerships
DRI sponsored Deerlick Royalty Partners I (“Partnership”) which was formed in April 1993. As the managing general partner, DRI is subject to full liability for the obligations of the Partnership although it is entitled to indemnification to the extent of the assets of the Partnership. Since “partnership programs” constitute a “security” under the Securities Act of 1933, Deven Resources, Inc. is also subject to potential liability for failure to comply with applicable Federal and state securities laws and regulations.
The Partnership owns overriding royalty interests covering 2,043 gross acres in the Deerlick Creek Coalbed Methane field located in Tuscaloosa County, Alabama. The Partnership is structured on a carried participation basis.
Acquisitions/Mergers
During the past two fiscal years, the Company has not participated in any mergers.During fiscal 2012, the Company (1) incurred $47,078 of acquisition costs of proved developed producing properties and (2) did not incur any exploration or development costs. During fiscal 2011, the Company did not incur any property acquisition, exploration or development costs.
Patent and License Agreement
Patent
CAMI was the owner of U.S. Patent No. 5,387,738 upon which an engineered product is based which utilizes all naturally occurring non-hazardous minerals for the remediation of sites contaminated with hazardous and/or toxic materials. Such patent expired on February 7, 2012. Typically, the remediation of these sites is necessary in order to meet quality control regulation for air, land and water enforced by the Environmental Protection Agency and various other state and Federal environmental regulatory agencies. Such engineered products are marketed by CAMI as CA Series Engineered products. Each of these engineered environmental products is designed for specific project site requirements based on the nature of the on-site contaminant, the size of the project and specific treatment requirements.
The CA Series Engineered products have been proven effective, through the use of a catalytically enhanced chemical exchange process, in permanently changing many hazardous metals to a non-hazardous state and, through molecular sieve and/or absorption processes, in removing many hazardous hydrocarbon and nitrate contaminants in connection with site remediation projects.
The processing of contaminate materials using the CA Series technology is designed as an on-site operation. Internal studies have shown that because the CA Series Engineered products are designed to be used at the remediation project site, substantial cost savings can be generated as compared to other remediation methods requiring extraction, removal and incineration. The on-site use of CA Engineered products can provide a complete and permanent environmental cleanup of the hazardous materials in that the treated materials are converted into non-hazardous permanently non-leachable substances that can remain in place. Through laboratory and field tests, the CA Series Engineered products have been proven to be effective in the remediation of contamination caused by hydrocarbons and petroleum products, chemicals and toxic metallic compounds in rendering the toxic and hazardous materials to a permanently non-toxic and non-hazardous stage.
License Agreement
In February 2010, the Company entered into a License Agreement concerning two US method patents for the treatment of sanitary wastewaters. Such patents utilize the Company’s zeolite. The license applies to the US and covers the use of the patented technology in water, wastewater and waste treatment in animal feed operations, agriculture, and aquaculture. In addition, the license applies to the treatment of sanitary wastewater on Federal facilities, military bases and lands administered by the US Bureau of Indian Affairs.
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Trademarks
The Company has a trademark for the Company’s ReNuGen™, a product used to enhance the efficacy of conventional waste water treatment plants
Employees and Contract Services
At September 30, 2012, the Company had three employees and engages the services of its Chief Accounting Officer pursuant to his employment agreement, as amended.
On February 25, 2011, the Company entered into a Consulting Services Agreement with the Musser Group, LLC (“Musser Group”) to perform consulting services for the Companythrough February 2013. The Company engaged the Musser Group, an independent contractor, to provide advisory and consulting services to the Company. The Musser Group is engaged to provide (i) managed services; (ii) strategic business planning and implementation; and (iii) assistance in directing and executing the implementation of any strategies approved by the Board of Directors of the Company. The Musser Group’s primary focus is the analysis and validation of market opportunities for the commercialization of products within the Company’s mineral segment.
The Company employs the services of consulting scientists, geologists and engineers, as well as those of nonaffiliated operating companies that conduct the actual oil and gas field operations and mineral extraction/processing. The Company operates oil and natural gas wells in Pennsylvania, Texas and West Virginia from its Pennsylvania office utilizing contract pumpers to perform actual field operations. The Company’s non-operated wells are monitored out of the Company’s Pennsylvania office.
The Company’s mineral lease, fee interest and mining claims are operated by contract mining entities and are monitored from its Pennsylvania office and by TPA under its agreement covering the Company’s Sierra Kaolin deposit. The Company considers its relations with its consultants to be satisfactory.
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PART IV
Item 15. Exhibits, Financial Statement Schedules.
FINANCIAL STATEMENTS.
The following audited financial statements are included herein in Item 8 of Part II:
| * | Report of Independent Registered Public Accounting Firm |
| * | Consolidated Balance Sheets |
| * | Consolidated Statements of Operations |
| * | Consolidated Statements of Shareholders’ Equity |
| * | Consolidated Statements of Cash Flow |
| * | Notes to Consolidated Financial Statements |
SUPPLEMENTAL INFORMATION.
The following supplemental information is included herein in Item 8 of Part II – See Notes 13 and 14:
| * | Estimated Net Quantities of Proved Oil and Gas Reserves |
| * | Standardized Measure of Discounted Future Net Cash Flow from Estimated Production of Proved Oil and Gas Reserves |
| * | Summary of Changes in Standardized Measure of Discounted Future Net Cash Flows |
EXHIBITS.
Exhibit No. | Description | Location | ||
| 2.1 | Agreement and Plan of Merger dated as of July 7, 2001, by and among Daleco Resources Corporation, DROC Acquisition, Inc., 16/6, Inc. and Thomas Smith | Incorporated by reference to Exhibit 2.1 to the Company’s Registration Statement on Form SB-2, as filed on September 3, 2002 | ||
| 2.2 | Agreement and Plan of Reorganization dated March 26, 2002 by and among Daleco Resources Corporation, a Delaware Corporation, and Daleco Resources Corporation of Nevada, a Nevada Corporation | Incorporated by reference to Exhibit 16(a) to the Company’s Current Report on Form 8-K dated April 10, 2002, as filed on April 11, 2002 | ||
| 2.3 | Agreement and Plan of Reorganization by and among Daleco Resources Corporation, Strategic Minerals, Inc. and Clean Age Minerals, Incorporated dated September 19, 2000 | Incorporated by reference to Exhibit 2.2 to the Company’s Registration Statement on Form SB-2 as filed on September 3, 2002 | ||
| 2.4 | Articles of Merger of Daleco Resources Corporation, a Delaware corporation, into and with Daleco Resources Corporation of Nevada, a Nevada corporation, dated March 26, 2002 | Incorporated by reference to Exhibit 16(d) to the Company’s Current Report on Form 8-K dated April 10, 2002, as filed on April 11, 2002 | ||
| 2.5 | Certificate of Merger of Daleco Resources Corporation, a Delaware corporation, into and with Daleco Resources Corporation of Nevada, a Nevada corporation, dated March 26, 2002 | Incorporated by reference to Exhibit 16(e) to the Company’s Current Report on Form 8-K dated April 10, 2002, as filed on April 11, 2002 | ||
| 3.1 | Articles of Incorporation of Daleco Resources Corporation of Nevada, Inc., a Nevada corporation | Incorporated by reference to Exhibit 16(b) to the Company’s Current Report on Form 8-K dated April 10, 2002, as filed on April 11, 2002 |
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Exhibit No. | Description | Location | ||
| 3.2 | Audit Committee Charter effective December 9, 2005 | Incorporated by reference to Exhibit 3.7 to the Company’s Annual Report on Form 10-KSB for the fiscal year ending September 30, 2005, as filed on January 17, 2006 | ||
| 3.3 | By-Laws of Daleco Resources Corporation of Nevada, Inc., a Nevada corporation | Incorporated by reference to Exhibit 16(c) to the Company’s Current Report on Form 8-K dated April 10, 2002, as filed on April 11, 2002 | ||
| 3.4 | Corporate Governance Policy effective April 10, 2008 | Incorporated by reference to Exhibit 3.4 to the Company’s Quarterly Report on Form 10-QSB for the quarterly period ended March 31, 2008, as filed on May 15, 2008 | ||
| 3.5 | Nominating and Governance Committee Charter effective April 10, 2008 | Incorporated by reference to Exhibit 3.5 to the Company’s Quarterly Report on Form 10-QSB for the quarterly period ended March 31, 2008, as filed on May 15, 2008 | ||
| 3.6 | Compensation Committee Charter effective April 10, 2008 | Incorporated by reference to Exhibit 3.6 to the Company’s Quarterly Report on Form 10-QSB for the quarterly period ended March 31, 2008, as filed on May 15, 2008 | ||
| 3.7 | Certificate of Amendment to Articles of Incorporation effective March 16, 2006 | Incorporated by reference to Exhibit 3.7 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011, as filed on May 23, 2011 | ||
| 10.1 | Securities Purchase Agreement - Letter of Intent dated July 23, 2001, by and between Terra Silex Holdings, LLC and Daleco Resources Corporation | Incorporated by reference to Exhibit 10.12 to the Company’s Registration Statement on Form SB-2 as filed on September 3, 2002 | ||
| 10.2 | Stock Purchase Agreement dated September 20, 2001 by and between Terra Silex Holdings Ltd. Co. and Daleco Resources Corporation | Incorporated by Reference to Exhibit 10.2 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 | ||
| 10.3 | Warrant Agreement, dated September 21, 2001, between Terra Silex Holdings Ltd. Co. and Daleco Resources Corporation | Incorporated by reference to Exhibit 10.14 to the Company’s Registration Statement on Form SB-2 as filed on September 3, 2002 | ||
| 10.4 | Employment Agreement, dated November 30, 2001, between the Registrant and Dov Amir | Incorporated by Reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 | ||
| 10.5 | Employment Agreement, dated November 30, 2001, between the Registrant and Gary Novinskie | Incorporated by Reference to Exhibit 10.5 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 | ||
| 10.6 | Amendment to Employment Agreement (see Exhibit 10.20) dated January 19, 2009, between the Company and Richard W. Blackstone | Incorporated by Reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K for the fiscal year ending September 30, 2011 as filed on January 13, 2012 | ||
| 10.7 | Key Man Contract, dated November 30, 2001, between the Company Robert E. Martin | Incorporated by Reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 |
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Exhibit No. | Description | Location |
| 10.8 | First Amendment to Master Distribution and Marketing Agreement among the Company and Sumitomo Corporation of America dated September 14, 2004 | Incorporated by reference to the attachment to the Company’s Form 8-K as filed on September 16, 2004 | ||
| 10.9 | Memorandum of Understanding for Development of Sierra Kaolin Deposit dated November 30, 2004 | Incorporated by Reference to Exhibit 10.9 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.10 | Development and Operating Agreement (Calcium Carbonates, Cibola County, NM) dated February 14, 2005 | Incorporated by Reference to Exhibit 10.38 to the Company’s Form 8-K as filed on February 17, 2005 | ||
| 10.11 | Market and Product Development Agreement dated February 22, 2005 | Incorporated by Reference to Exhibit 10.39 to the Company’s Form 8-K as filed on March 1, 2005 | ||
| 10.12 | Sierra Kaolin Operating License dated March 11, 2005 | Incorporated by Reference to Exhibit 10.39 to the Company’s Form 8-K as filed on March 17, 2005 | ||
| 10.13 | Employment Agreement, effective August 10, 2005, between the Company and Stephan V. Benediktson | Incorporated by Reference to Exhibit 10.13 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.14 | Employment Agreement, effective August 10, 2005, between the Company and Nathan K. Trynin | Incorporated by Reference to Exhibit 10.14 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.15 | Third Amendment To Limestone Mining Lease and Agreement, dated August 22, 2007 | Incorporated by Reference to Exhibit 10.15 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.16 | Settlement Agreement dated July 12, 2011 between the Company and Dov Amir | Incorporated by Reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ending September 30, 2011 as filed on January 13, 2012 | ||
| 10.17 | Sierra Kaolin Restated Development and Operating Agreement Among Tecumseh Professional Associates, Inc., Tecumseh Industrial Minerals, LLC, Daleco Resources Corporation, Clean Age Minerals, Inc., and C.A. Properties, Inc. dated June 7, 2007 | Incorporated by reference to Exhibit 10.45 to the Company’s Quarterly Report on Form 10-QSB for the quarterly period ended June 30, 2007, as filed on August 14, 2007 | ||
| 10.18 | Separation Agreement, dated October 27, 2006, between the Company and Dov Amir | Incorporated by Reference to Exhibit 10.18 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.19 | Employment Agreement, dated January 23, 2006, between the Company and David L. Matz | Incorporated by Reference to Exhibit 10.19 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 | ||
| 10.20 | Employment Agreement, dated October 4, 2006, between the Company and Richard W. Blackstone | Incorporated by Reference to Exhibit 10.20 to the Company's Annual Report on Form 10-KSB for the fiscal year ending September 30, 2007 as filed on February 14, 2008 |
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Exhibit No. | Description | Location |
| 10.21 | Non-qualified Independent Director Stock Option Plan Approved by the Shareholders at the Annual Meeting on March 24, 2004 | Incorporated by Reference to Exhibit 10.21 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 | ||
| 10.22 | Second Amendment to Loan Agreement dated December 31, 2003 | Incorporated by reference to Exhibit 10.22 to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2009 as filed on May 20, 2009 | ||
| 10.23 | Consulting Services Agreement between The Musser Group LLC and Daleco Resources Corporation dated February 25, 2011 | Incorporated by reference to Exhibit 10.23 to the Form 8-K as filed March 3, 2011 | ||
| 10.24 | Notice of Waiver Date, effective April 3, 2012, concerning Employment Agreement of Gary J. Novinskie (dated November 30, 2001 – see Exhibits 10.5) | Incorporated by reference to Exhibit 10.24 to the Quarterly report on Form 10-Q for the quarter ended March 31, 2012 as filed on May 14, 2012 | ||
| 10.25 | Notice of Waiver Date, effective April 3, 2012, concerning Employment Agreement of Richard W. Blackstone (dated October 4, 2006 – see Exhibits 10.20 and10.6) | Incorporated by reference to Exhibit 10.25 to the Quarterly report on Form 10-Q for the quarter ended March 31, 2012as filed on May 14, 2012 | ||
| 10.26 | Employment Agreement (effective May 18, 2012) between the Registrant and Michael D. Parrish dated August 23, 2012 | Incorporated by reference to Exhibit 10.26 to the Current Report on Form 8-K dated August 23, 2012 as filed on August 28, 2012 | ||
| 14.1 | Code of Ethics adopted December 9, 2005 | Incorporated by reference to Exhibit 14.1 to the Company’s Annual Report on Form 10-KSB for the fiscal year ending September 30, 2005 as filed on January 17, 2006 | ||
| 21 | Subsidiaries of the Company | Attached hereto | ||
| 23.1 | Consent of Krumrey Industrial Minerals, LLC dated December 29, 2010 | Incorporated by Reference to Exhibit 23.1 to the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the fiscal year ending September 30, 2010 as filed on August 11, 2011 | ||
| 31.1 | Certification of Michael D. Parrish, Chief Executive Officer, dated May 9, 2013 | Attached hereto | ||
| 31.2 | Certification of Gary J. Novinskie, Chief Financial Officer, dated May 9, 2013 | Attached hereto | ||
| 32.1 | Certification of Michael D. Parrish, Chief Executive Officer (Principal Executive Officer) and Gary J. Novinskie, Chief Financial Officer (Principal Financial Officer), dated May 9, 2013 | Attached hereto | ||
| 99.1 | Location Maps for Registrant’s Zeolite lease in Marfa County, Texas, Kaolin Claims in Sierra County, New Mexico, and Zeolite Claims in Beacon County, Utah | Attached hereto | ||
| 99.2 | Summary Reserve Report of Hall Energy, Inc. dated January 7, 2013 | Attached hereto |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
| DALECO RESOURCES CORPORATION | ||
| Dated: May 9, 2013 | By: | /s/ MICHAEL D. PARRISH |
| Michael D. Parrish, Chief Executive Officer and | ||
| Director | ||
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Dated: May 9, 2013 | By: | /s/ MICHAEL D. PARRISH |
| Michael D. Parrish, Chief Executive Officer and | ||
| Director (Principal Executive Officer) | ||
| Dated: May 9, 2013 | By: | /s/ GARY J. NOVINSKIE |
| Gary J. Novinskie, President and Chief Financial | ||
| Officer and Director (Principal Financial and | ||
| Accounting Officer) | ||
| Dated: May 9, 2013 | By: | /s/ JOHN GILBERT |
| John Gilbert, Director | ||
| Dated: May 9, 2013 | By: | /s/ DAVID A. GRADY |
| David A. Grady, Director | ||
| Dated: May 9, 2013 | By: | /s/ CARL A. HAESSLER |
| Carl A. Haessler, Director | ||
| Dated: May 9, 2013 | By: | /s/ LI CHI KONG |
| Li Chi Kong, Director | ||
| Dated: May 9, 2013 | By: | /s/ GRANT LIN |
| Grant Lin, Director | ||
| Dated: May 9, 2013 | By: | /s/ ROBERT E. MARTIN |
| Robert E. Martin, Director | ||
| Dated: May 9, 2013 | By: | /s/ CHARLES T. MAXWELL |
| Charles T. Maxwell, Director | ||
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