History
Diversified Resources grew from a small shell into a Colorado and New Mexico oil and gas company with an oilfield services arm, funded largely by issuing shares, with auditors noting going-concern doubt.
2013-2014: A Colorado reverse takeover
The record opens on November 21, 2013, when Diversified Resources acquired Natural Resource Group, Inc. for 14,558,150 new shares. Natural Resource Group's former shareholders then owned 85% of the company, so existing holders were heavily diluted. Shares on issue rose from 5,250,000 at the end of 2013 to 22,502,206 a year later. The deal brought about 4,600 acres in the Garcia Field and 1,400 acres in the Denver-Julesburg Basin, plus a 640-acre lease acquired in 2013. Management changed: Paul Laird, Duane Bacon, Roger May and Albert McMullin were appointed, and Philip Grey resigned and sold back 2,680,033 shares. The gas wells were still not connected to a pipeline, which the filing estimated would cost about $1,000,000.
2014-2015: New Mexico and a hunt for funding
In June 2014 the company agreed to buy 48 producing wells and about 10,400 acres in the Horseshoe-Gallup field, New Mexico, for $6,000,000 cash plus 900,000 restricted shares. The deal was restructured twice and closed on October 7, 2014. The company bought about 98% of BIYA Operating, Inc. for roughly $200,000 cash, the 900,000 shares, a note of about $1,800,000 due October 2016 at 5%, and about $2,000,000 of assumed liabilities. The note takes effect only when certain Indian tribal land leases are issued.
Funding came next. In June 2015 the company approved $650,000 of 12% convertible notes, and in July it began offering up to 1,000 units of Series A Preferred shares and warrants, aiming for up to $10,000,000. The filings do not say what the money was for, or how many units were sold.
2015-2017: Oilfield services
In December 2015 the company agreed to buy two Greeley, Colorado services firms, Ultra-Energy Solutions and Vinco Logistics, for about 18,858,400 shares. On February 5, 2016 it switched to buying Diversified Energy Resources, Inc., a holding company for three oilfield service companies, for 20,032,710 shares. Shares on issue climbed to 44,893,062 by the end of 2016.
The services push partly reversed on April 28, 2017, when the company sold one of the three, Champion, back to its former owner Michael Miller. He forgave a $2,000,000 note and surrendered 3,832,710 shares, cutting liabilities by about $2,509,900. Champion had lost about $630,200 on revenue of about $2,479,200 over the period reported.
As of May 16, 2017, the company held its Colorado and New Mexico oil and gas interests and two remaining service companies. Its auditors had noted going-concern doubt, the Garcia gas was still not piped, and the tribal leases behind the BIYA note were still pending.
Written from the 9 story beats below (2013 to 16 May 2017), which come from the company's own announcements and filings.