##### Table of Contents



SECURITIES AND EXCHANGE
    COMMISSION
 Washington, D.C.
    20549
  FORM 10-KSB
  þ

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2005ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission
    file
    no. 0-30502
  JOHN D.
    OIL AND GAS COMPANY
 (Exact name of Small Business
    Issuer as specified in its charter)
  MARYLAND

94-6542723(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer Identification
    No.)   8500
    STATION STREET, SUITE 100, MENTOR, OHIO 44060 (Address
    of principal executive office)
  Issuers
    telephone number, including area
    code: (440) 974-3770
      o
  þ o
  regulation S-B Form 10-KSB Form 10-KSB. þ
  Rule 12b-2 o þ
        o þ
  Documents incorporated by reference:  Portions of
    the registrants definitive proxy statement for the annual
    meeting of stockholders to be held on June 13, 2006 are
    incorporated by reference into Part III of this
    10-KSB.




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##### 



JOHN D.
    OIL AND GAS COMPANY
  INDEX TO
    ANNUAL REPORT
 ON
    FORM 10-KSB
  PagePART IItem 1:

Description of
    Business


1Item 2:

Description of
    Property


3Item 3:

Legal
    Proceedings


5Item 4:

Submission of
    Matters to a Vote of Security Holders


5PART IIItem 5:

Market for Common
    Equity, Related Stockholder Matters and Issuers Purchase
    of Equity Securities


5Item 6:

Managements
    Discussion and Analysis or Plan of Operation


7Item 7:

Financial
    Statements


13Item 8:

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


13Item 8A:

Controls and
    Procedures


13Item 8B:

Other
    Information


13PART IIIItem 9:

Directors,
    Executive Officers and Control Persons; Compliance with
    Section 16(a) of the Exchange Act


14Item 10:

Executive
    Compensation


14Item 11:

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


14Item 12:

Certain
    Relationships and Related Transactions


14Item 13:

Exhibits


14Item 14:

Principal
    Accountant Fees and Services


15EX-31.1 CertificationEX-31.2 CertificationEX-32.1 Certification   i




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##### Table of Contents



PART I  Item 1.
    Description
    of Business  History.
        Discontinued Operations.
  Operating Partnership.
 1




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##### Table of Contents



Self-Storage Industry Overview.
      Federal Income Tax.
  Employees. on-site
 2




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##### Table of Contents



Item 2.
    Description
    of Property  The
    Self-Storage Facilities
      Date


Year Built/


Rentable





InsideLocation

Acquired


Expanded


Square Footage


Acres


Units


ConstructionGahanna


2/24/04



1988



30,525



2.29



258



SteelPainesville**


10/01/00



1940/2000
*


31,765



3.20



362



Steel     *
    
    Year additional units were added by the Company.**
    
    In addition, Painesville has 22,685 square feet of office
    and retail space, with an occupancy rate of 89.9% and an annual
    rental rate of $10.62 per square foot at December 31,
    2005.    Continuing
    Operation Facilities
  Annual Rental RateOccupancy


Per OccupiedLocation

Rate %


Square Foot $Painesville


36.45



9.03Gahanna


93.94



6.96Average


65.20



8.00   Environmental and Other Regulations.
        Property Management. on-site
 3




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##### Table of Contents



Competition.
  Leases.
  Insurance.
    Mortgages. 20-year
    Depreciation.
  Investment
    Policy
    Activities of the Company.
   4




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##### Table of Contents



8.
    furnish annual reports and other reports to stockholders which
    contain annual audited financial statements.    Investment Strategy.
  Item 3.
    Legal
    Proceedings.    Item 4.
    Submission
    of Matters to a Vote of Security Holders.   PART II  Item 5.
    Market
    for Common Equity, Related Stockholder Matters and Issuers
    Purchases of Equity Securities.  Market Information. Over-the-Counter
 5




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##### Table of Contents



High


Low2005First Quarter

$
0.63


$
0.49Second Quarter


0.65



0.35Third Quarter


0.85



0.35Fourth Quarter


0.85



0.602004First Quarter

$
0.85


$
0.49Second Quarter


0.87



0.49Third Quarter


0.87



0.55Fourth Quarter


0.55



0.49   Record Holders.
  Dividends.
  Issuance of Common Stock.
  Purchases of Common Stock.
  EQUITY
    COMPENSATION PLAN INFORMATION
  Number of securitiesNumber of securities


Weighted-average


remaining available forto be issued upon


exercise price of


future issuance underexercise of


outstanding


equity compensation plansoutstanding options,


options, warrants


(excluding securitieswarrants and rights


and rights


reflected in column (a))(a)


(b)


(c)Equity compensation plans approved
    by security holders


135,000


$
0.5625



165,000Equity compensation plans not
    approved by security holders










Total


135,000


$
0.5625



165,000  6




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##### Table of Contents



Item 6.
    Managements
    Discussion and Analysis or Plan of Operation              Accounting
    Policies
   7




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##### Table of Contents



Revenue recognition:
  Property and equipment:
  Fair Value of Financial Instruments and
    Derivatives:
  Impairment of long-lived
    assets:
  Reclassification:
  Cash-flow Statement:
  Liquidity
    and Capital Resources
    12-month
 8




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##### Table of Contents



Payments Due by PeriodLess than








AfterContractual
    Obligations

1 year


1-3 years


4-5 years


5 years


TotalLong-Term Debt

$
704,753


$
250,513


$
1,927,971


$



$
2,883,237Operating Lease*


15,600



31,200



23,400







70,200Total Contractual Cash Obligations

$
720,353


$
281,713


$
1,951,371


$



$
2,953,437     *
    
    The operating lease for office space was renegotiated on
    July 1, 2005 with a five year term ending July 2010, at a
    rental of $1,300 per month, which is reflected in the above
    table.         9




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##### Table of Contents



Material
    Changes in Results of Operations
    Revenues
    from Continuing Operations
    Expenses
    from Continuing Operations
              Loss
    from Continuing Operations
   10




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##### Table of Contents



Income
    from Discontinued Operations
    Net
    Income
    Funds
    from Operations
    
    a substitute for net income (determined in accordance with GAAP);
    an indication of the Companys financial performance;
    a substitute for cash flows from operating activities
    (determined in accordance with GAAP); or
    a measure of the Companys liquidity.      For the Year Ended
    December 31,2005


2004Net Loss from continuing operations

$
(344,335
)

$
(325,282
)Adjustments:Depreciation of real estate and
    amortization of deferred fees


178,989



193,994Minority Interest


(803,448
)


(758,990
)FFO

$
(968,794
)

$
(890,278
)   Interest
    Rate Risk
     11




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##### Table of Contents



Off-Balance
    Sheet Arrangements
        Forward-Looking
    Statements
    
    the loss of the Companys tax status as a REIT in 2006;
    the Companys ability to implement its new business plan,
    as drilling wells for oil and gas is a high-risk enterprise and
    there is no guarantee the Company will become profitable;
    the interest rate market, which, when interest rates increase,
    will cause the Companys expenses on its variable-rate
    mortgages to increase;
    the Companys ability to increase occupancy and rental
    rates at its self-storage facilities;
    the ability of the Company to issue additional shares, sell its
    assets or properties or obtain debt financing on satisfactory
    terms;
    the ability to refinance the Companys debts as they come
    due, including, without limitation, the Companys maturing
    long-term debt;
    changes in local real estate conditions;
    the inability to generate sufficient revenues to meet operating
    expenses, including, but not limited to, possible rising
    property insurance costs; and
    decreases in occupancy rates.    Election
    of REIT Status
     12




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##### Table of Contents



Recently
    Issued Accounting Pronouncements
        Item 7.
    Financial
    Statements    Item 8.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure   Item 8A.  Controls
    and Procedures  Rule 13a-14.
 Item 8B.  Other
    Information   13




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##### Table of Contents



PART III  Item 9.
    Directors,
    Executive Officers and Control Persons; Compliance with
    Section 16 (a) of the Exchange Act    Item 10.
    Executive
    Compensation    Item 11.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Item 12.
    Certain
    Relationships and Related Transactions   Item 13.  Exhibits   Regulation S-B)
  Exhibit No.

Description2
.1

Purchase and Sale Agreement
    entered into August 4, 1997, together with First Amendment
    to Purchase and Sale Agreement effective August 7, 1997 and
    Second Amendment to Purchase and Sale Agreement effective
    August 15, 1997, between Meridian Point Realty Trust
    83 and 2400 Charleston Associates, LLC (successor to
    Rubin-Pachulski Properties, Inc.) (Filed as Exhibit 10.1 to
    Registrants
    Form 8-K
    dated September 5, 1997 and incorporated herein by
    reference.)2
.2

Agreement and Plan of Merger,
    dated as of December 28, 1999, by and among Meridian Point
    Realty Trust 83, the Company and Liberty Self-Stor Limited
    Partnership (Exhibits A and B to the Agreement and Plan of
    Merger are Exhibits 3.1 and 3.2, respectively) (Filed as
    Exhibit 2.1 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)3
.1

Articles of Incorporation of the
    Company (Filed as Exhibit 3.1 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)3
.2

Articles of Amendment to the
    Articles of Incorporation of the Company dated March 29,
    2006 (Filed as Exhibit 3.1 to Registrants
    Form 8-K dated June 27, 2005 and incorporated herein
    by reference.)3
.3

Bylaws of the Company (Filed as
    Exhibit 3.2 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)10
.1

Agreement between Meridian Point
    Realty Trust 83 and E&L Associates, dated
    February 23, 1996 (Filed as part of Registrants
    Form 8-K
    dated February 10, 1995 and incorporated herein by
    reference.)10
.2

Indemnity Trust Agreement,
    dated as of September 2, 1998, by and between Meridian
    Point Realty Trust 83 and U.S. Trust Company, N.A.
    (Filed as Exhibit 10.2 to Registrants
    Form 10-KSB
    dated March 31, 1999 and incorporated herein by reference.)10
.3

1999 Stock Option and Award Plan
    of the Company (Filed as Exhibit 10.1 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)10
.4

Lease between OsAir, Inc. and the
    Company (Filed as Exhibit 10.2 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.) 14




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##### Table of Contents



Exhibit No.

Description10
.5

Agreement of Limited Partnership
    of LSS I Limited Partnership, dated December 29, 1999.
    (Filed as Exhibit 10.3 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)10
.6

Employment Agreement, dated
    December 28, 1999, by and between the Company and Thomas J.
    Smith (Filed as Exhibit 10.4 to Registrants
    Form 8-K
    dated January 12, 2000 and incorporated herein by
    reference.)10
.7

Cost Sharing Agreement, by and
    between Liberty Self-Stor, Ltd. and Liberty Self-Stor II,
    Ltd. dated December 28, 1999 (Filed as Exhibit 10.7 to
    Registrants
    Form 10-KSB,
    dated March 15, 2000 and incorporated herein by reference.)10
.8

Contract among Acquiport/Amsdell I
    Limited Partnership
    and/or its
    nominee, Liberty Self-Stor, Ltd. and Liberty Self-Stor II,
    Ltd (Filed as Exhibit 10.1 to Registrants
    Form 8K; dated September 7, 2004 and incorporated
    herein by reference)10
.9*

Amended and Restated First
    Amendment to Agreement of Limited Partnership of LSS I Limited
    Partnership dated March 29, 200610
.10

Registration Rights Agreement
    dated February 28, 2006 between the Company and the Richard
    M. Osborne Trust (Filed as Exhibit 4.1 to Registrants
    Form 8-K
    dated February 24, 2006 and incorporated herein by
    reference.)10
.11

Stock Subscription Agreement dated
    February 28, 2006 between the Company and the Richard M.
    Osborne Trust (Filed as Exhibit 10.1 to Registrants
    Form 8-K
    dated February 24, 2006 and incorporated herein by
    reference.)10
.12

Stock Subscription Agreement dated
    February 28, 2006 between the Company and Terence P. Coyne
    (Filed as Exhibit 10.2 to Registrants
    Form 8-K
    dated February 24, 2006 and incorporated herein by
    reference.)31
.1*

Section 302 Certification of
    Chairman of the Board and Chief Executive Officer (principal
    executive officer) pursuant to the Sarbanes-Oxley Act of 200231
.2*

Section 302 Certification of
    Chief Financial Officer (principal financial officer) pursuant
    to the Sarbanes-Oxley Act of 200232
.1*

Certification of Chairman of the
    Board and Chief Executive Officer (principal executive officer)
    and Chief Financial Officer (principal financial officer)
    pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.     *
    
    Filed herewith  Item 14.
    Principal
    Accountant Fees and Services   15




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##### Table of Contents



SIGNATURES
    Dated: March 29, 2006

JOHN D. OIL AND GAS COMPANYBy:

/s/  Richard
    M. OsborneRichard M. OsborneChairman and Chief Executive
    Officer(Principal Executive Officer)     /s/  Richard
    M. OsborneRichard
    M. Osborne

Chairman, Chief Executive Officer
    and
    Director (Principal Executive Officer)

Dated: March 29, 2006/s/  C.
    Jean MihitschC.
    Jean Mihitsch

Chief Financial Officer
    (Principal
    Financial and Accounting Officer)

Dated: March 29, 2006/s/  Steven
    A. CalabreseSteven
    A. Calabrese

Director

Dated: March 29, 2006/s/  Terence
    P. CoyneTerence
    P. Coyne

Director

Dated: March 29, 2006/s/  Richard
    T. Flenner Jr.Richard
    T. Flenner

Director

Dated: March 29, 2006/s/  Mark
    D. GrossiMark
    D Grossi

Director

Dated: March 29, 2006/s/  Marc
    C. KrantzMarc
    C. Krantz

Secretary and Director

Dated: March 29, 2006/s/  Gregory
    J. OsborneGregory
    J. Osborne

Director

Dated: March 29, 2006/s/  Thomas
    J. SmithThomas
    J. Smith

Director

Dated: March 29, 2006  16




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##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
               17




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  CONSOLIDATED
    BALANCE SHEETS
  December 31,
    2005 and 2004
  December 31,2005


2004ASSETSCURRENT ASSETS:Cash

$
878,613


$
396,918Accounts Receivable


1,324



922Accounts Receivable from related
    parties


59,632



271,758Assets Related to Discontinued
    Operations, net






27,012,322Assets Held for Sale


204,762



Other current assets


9,391



2,862Total Current Assets


1,153,722



27,684,782PROPERTY AND EQUIPMENT:Land


481,164



685,926Buildings and Improvement


3,935,928



3,935,928Furniture and Equipment


224,054



168,042Accumulated Depreciation


(861,519
)


(680,811
)3,779,627



4,109,085Minority Interest Receivable


391,672



OTHER ASSETS


35,011



38,293TOTAL ASSETS

$
5,360,032


$
31,832,160LIABILITIES AND
    SHAREHOLDERS EQUITYLIABILITIES:Current maturities of long-term debt

$
112,843


$
151,406Note Payable to related party


591,910



1,300,000Accounts Payable


375,280



91,526Accounts Payable to related parties


16,422



464,854Liabilities Related to Discontinued
    Operations, net






24,830,802Accrued expenses


280,194



475,530Total Current Liabilities


1,376,649



27,314,118LONG TERM DEBT, net of current
    maturities


2,178,484



2,270,844OTHER LONG-TERM LIABILITIES


8,129



12,561MINORITY INTEREST LIABILITY






1,561,405COMMITMENTS AND CONTINGENCIES






SHAREHOLDERS EQUITY:Serial preferred
    stock  $.001 par value: 2,000,000 shares
    authorized, no shares issued and outstanding






Common
    Stock  $.001 par value:
    50,000,000 shares authorized; 3,081,541 and
    3,082,668 shares issued and outstanding, stated at


3,082



3,083Paid-in capital


25,798,779



25,799,229Retained earnings (Loss)


(24,005,091
)


(25,176,918
)Accumulated other comprehensive
    income






47,838Total Shareholders Equity


1,796,770



673,232TOTAL LIABILITIES AND
    SHAREHOLDERS EQUITY

$
5,360,032


$
31,832,160     18




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  CONSOLIDATED
    STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
  For the
    Years Ended December 31, 2005 and 2004
  2005


2004REVENUESRevenues from real estate
    operations

$
521,876


$
494,753Interest and other


27,826



6,125Total revenues


549,702



500,878OPERATING EXPENSESInterest expense


222,963



158,432Property taxes and insurance


147,295



137,521Property operating expense


207,667



196,931Legal and professional fees


244,245



262,814General and administrative,
    including amounts paid to a related party of $37,800 and
    $48,000, respectively


696,326



635,458Depreciation and amortization


178,989



193,994Total expenses


1,697,485



1,585,150Loss from continuing operations
    before minority interest


(1,147,783
)


(1,084,272
)Minority interest


(803,448
)


(758,990
)Loss from continuing operations


(344,335
)


(325,282
)Income from discontinued
    operations, net of minority interest of $192,340 and $766,926


82,431



328,683Gain on sale of assets from
    discontinued operations, net of minority interest of $4,783,955


2,050,265



Income from discontinued operations


2,132,696



328,683Net Income

$
1,788,361


$
3,401Other comprehensive income (loss)Changes in fair values of cash
    flow hedges, net of minority interest of ($111,619) and $104,545


(47,838
)


44,805Comprehensive Income:

$
1,740,523


$
48,206Weighted Average Basic
    Shares Outstanding:


3,082,255



3,082,668Weighted Average Diluted
    Shares Outstanding:


3,087,890



3,082,668Loss per common share from
    continuing operations  basic and diluted:

$
(0.11
)

$
(0.11
)Earnings per common share from
    discontinued operations  basic and diluted:


0.69



0.11Earnings per common
    share  basic and diluted:

$
0.58


$
0.00     19




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  CONSOLIDATED
    STATEMENTS OF SHAREHOLDERS EQUITY
  For the
    Years Ended December 31, 2005 and 2004
  AccumulatedRetained


OtherCommon


Paid-in


Earnings


ComprehensiveStock


Capital


(Loss)


Income (Loss)


TotalBalance at December 31, 2003

$
3,083


$
25,799,229


$
(25,180,319
)

$
3,033


$
625,026Net Income










3,401







3,401Change in fair value of cash flow
    hedges














44,805



44,805Balance at December 31, 2004

$
3,083


$
25,799,229


$
(25,176,918
)

$
47,838


$
673,232Redemption of Common Stock


(1
)


(450
)










(451
)Cash Dividends of $0.20 per
    share










(616,534
)






(616,534
)Net Income










1,788,361







1,788,361Change in fair value of cash flow
    hedges














(47,838
)


(47,838
)Balance at December 31, 2005

$
3,082


$
25,798,779


$
(24,005,091
)

$



$
1,796,770    20




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  For the
    Years Ended December 31, 2005 and 2004
  2005


2004CASH FLOWS FROM OPERATING
    ACTIVITIES:Net income

$
1,788,361


$
3,401Adjustments to reconcile net loss
    to net cash from operating activitiesDepreciation and amortization


178,989



193,994Gain on sale of security






(5,002
)Minority interest income


(803,448
)


7,936Distributions to minority interest


(6,014,305
)


Changes in operating assets and
    liabilities:Accounts receivable


211,724



(154,397
)Other current assets


(6,529
)


12,396Other assets


5,001



(14,184
)Accounts payable


(164,678
)


47,110Accrued expenses


(195,336
)


76,944Other liabilities


(4,432
)


(4,809
)Change in Discontinued Operations,
    as revised


(2,284,488
)


701,223Net cash provided by operating
    activities


(7,289,141
)


864,612CASH FLOWS FROM INVESTING
    ACTIVITIES:Purchases of property equipment,
    net


(56,012
)


(1,169,367
)Proceeds from sale of equipment






12,984Proceeds from sale of security






12,602Change in Discontinued Operations,
    as revised


33,476,273



(4,139
)Net cash used in investing
    activities


33,420,261



(1,147,920
)CASH FLOWS FROM FINANCING
    ACTIVITIES:Dividends paid to shareholders


(616,534
)


Distributions to dissenting
    shareholders


(451
)


Principal payments on notes payable


(130,923
)


(406,949
)Principal payments to related party


(708,090
)


Borrowings from related party






250,000Borrowings from third party






787,500Change in Discontinued Operations,
    as revised


(24,193,427
)


(484,671
)Net cash used in financing
    activities


(25,649,425
)


145,880NET INCREASE (DECREASE) IN CASH


481,695



(137,428
)CASH, beginning of period


396,918



534,346CASH, end of period

$
878,613


$
396,918    21




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and 2004
  1.
    General          2.
    Recent
    Event   22




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
    3.
    Summary
    of Significant Accounting Policies  Principles
    of Consolidation
    Accounts
    Receivable
    Property
    and Equipment
      Asset
    Impairment
    Revenue
    Recognition
   23




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
       2006

$
219,0542007


207,8802008


163,3802009


157,9802010


108,720Thereafter


36,443$
893,457   Comprehensive
    Income
    Reclassifications
    Cash-flow
    Statement
    Advertising
    and Promotion Costs
    Employee
    Benefits
   24




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
        2005


2004Weighted





WeightedAverage





AverageShares


Price


Shares


PriceOutstanding at beginning of year


135,000


$
0.56



170,000


$
0.55Granted










Exercised










Forfeited










(35,000
)

$
0.48Outstanding at end of year


135,000


$
0.56



135,000


$
0.56Options available for grant


165,000







165,000Exercisable at end of year


135,000


$
0.56



135,000


$
0.56   Estimates,
    Risks and Uncertainties
    Fair
    Value of Financial Instruments
    Derivative
    Instruments
   25




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
    Recently
    Issued Accounting Pronouncements
       26




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
   4.
    Discontinued
    Operations    For the Years EndedDecember 31,2005


2004RevenuesRevenues from real estate
    operations

$
1,270,645


$
5,180,356Operating expensesInterest expense


348,762



1,298,368Property taxes and insurance


172,064



649,058Property operating expense


354,401



1,082,346Legal and professional fees


5,387



22,174General and administrative


32,602



186,062Depreciation and amortization


82,658



846,739Total expenses


995,874



4,084,747Income from discontinued
    operations before minority interest and gain on sale of eighteen
    sites, net of minority interest


274,771



1,095,609Minority interest


(192,340
)


(766,926
)Income before gain on sale, net


82,431



328,683Gain on sale of eighteen sites,
    net of minority interest of $4,783,955


2,050,265



Income from discontinued operations

$
2,132,696


$
328,683  27




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
   5.
    Long-Term
    Debt    Current


Outstanding Balances atSite



Maturity


Interest


December 31,Reference

Interest Rate Index

Date


Rate


2005


2004Gahanna

Prime


3-01-09



7.25
%

$
734,932


$
760,910Painesville

30 day LIBOR plus 2.50%
    Converted to 5 yr US Treasury Plus 2.25% on April, 2005


3-30-09



6.88
%


1,556,395



1,661,340Painesville

Prime


11-30-07



7.25
%


591,910



1,300,000Continuing Operations Total


2,883,237



3,722,250Discontinued Operations Total






24,033,970Long-Term Debt Total


2,883,237



27,756,220Less Continuing current maturities


112,843



151,406Less Discontinued current
    maturities






2,258,502Less related party notes


591,910



1,300,000Long-Term debt, net of current
    maturities and
    related party notes payable

$
2,178,484


$
24,046,312       2006

$
704,7532007


120,9262008


129,5872009


1,927,971$
2,883,237       6.
    Notes Payable
    to Related Party   28




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
    7.
    Earnings/Loss
    Per Share      For the YearsEnded
    December 31,2005


2004Weighted average number of common
    shares outstanding used in basic earnings per common share
    calculation


3,082,255



3,082,668Dilutive effect of stock options


5,635



Weighted average number of common
    shares outstanding adjusted for effect of dilutive options used
    in diluted EPS calculation


3,087,890



3,082,668Loss from continuing operations

$
(344,335
)

$
(325,282
)Income from discontinued operations

$
2,132,696


$
328,683Net income

$
1,788,361


$
3,401Basic and Diluted:Loss per common share from
    continuing operations

$
(0.11
)

$
(0.11
)Earnings per common share from
    discontinued operations

$
0.69


$
0.11Earnings per common share, net

$
0.58


$
0.00       8.
    Income
    Taxes     29




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
        9.
    Other
    Related Party Transactions           30




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##### Table of Contents



JOHN D.
    OIL AND GAS COMPANY AND SUBSIDIARY
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  For the
    Years Ended December 31, 2005 and
    2004  (Continued)
         10.
    Commitments
    and Contingencies    11.
    Subsequent
    Events     31




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##### Table of Contents



Exhibit 10.9
  AMENDED
    AND RESTATED
    FIRST AMENDMENT
    TO
    AGREEMENT OF LIMITED PARTNERSHIP
    OF
    LSS I LIMITED PARTNERSHIP
  Amendment and Restatement) Company General Partner (Osborne) (Smith) (RMC) Limited Partners, Limited Partner
  RECITALS:
  First Amendment Partnership Agreement
    Transaction
        AGREEMENT:
  NOW, THEREFORE, in consideration of the mutual premises and
    covenants contained herein, and other good and valuable
    consideration, the receipt and sufficiency of which is hereby
    acknowledged, the parties hereby agree to amend the Partnership
    Agreement as follows:
  1. Section 6.5 of the Partnership Agreement is
    hereby deleted in its entirety and replaced with the following
    amended and restated Section 6.5:
  Section 6.5 Management
    Fee.  The General Partner, as the Partner
    responsible for the management of the affairs and business of
    the Partnership and in exchange for such services, shall be
    entitled to an annual management fee equal to six percent (6%)
    of the annual gross revenue of the Partnership (the
    Management Fee), payable at least annually at
    such times as the General Partner shall determine in its sole
    discretion. The parties hereto agree that the Management Fee
    shall, for purposes of taxation, be regarded by the Partners,
    pursuant to Section 707(a) of the Code, as a payment to the
 32




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##### Table of Contents



General Partner in a transaction between the Partnership and
    the General Partner acting other than in his capacity as a
    member of the partnership. The General Partner shall not be
    entitled to reimbursement (other than the Management Fee) for
    any expenses incurred by the General Partner in performance of
    its duties as General Partner under the Partnership Agreement,
    but shall rely solely on the Management Fee for such purpose.
  2. Section 6.7 of the Partnership Agreement is
    hereby amended by deleting and reserving Section 6.7(a)
    thereto.
  3. The definition of Exchange Factor in
    Section 1 of Exhibit D to the Partnership Agreement is
    hereby deleted in its entirety and replaced with the following
    amended and restated definition:
  Effective as of April 22, 2005, Exchange
    Factor shall mean 13.77148%, provided that such factor
    shall be adjusted in accordance with the Antidilution Provisions
    of Paragraph 7 hereof.
  4. Section 7 of Exhibit D to the Partnership
    Agreement is hereby amended by adding the following
    Subsection (e) thereto:
  (e) If any event occurs as to which any of the
    provisions of this Section 7 are not strictly applicable,
    or if strictly applicable, would not fairly protect the exchange
    rights of a holder of Partnership Units or otherwise would not
    fairly protect the REIT shareholders, the General Partner shall
    make such other adjustments to the number of REIT Shares
    issuable upon exchange of a Partnership Unit, as determined by
    the General Partners board of directors exercising its
    reasonable judgment, as it deems necessary to comply with the
    established interests and principles of this Section 7,
    including, but not limited to, the adjustment of the definition
    of Exchange Factor.
  5. Except as explicitly amended by this Amendment, the
    Partnership Agreement remains unmodified and in full force and
    effect.
  < signature
    page follows>
 33




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##### Table of Contents



IN WITNESS WHEREOF, this Amended and Restated First Amendment
    to Agreement of Limited Partnership of LSS I Limited Partnership
    has been duly executed and delivered by the parties as of the
    date first written above.
  GENERAL PARTNER:
  JOHN D. OIL AND GAS COMPANY,
 a Maryland corporation
  By:
    /s/  Thomas
    J. Smith  Name:Thomas J. Smith
  Title:
    President and Chief Operating Officer  CLASS A LIMITED PARTNERS:
  /s/  Richard
    M. Osborne
  Richard M. Osborne
  /s/  Thomas
    J. Smith
  Thomas J. Smith
  RETIREMENT MANAGEMENT COMPANY,
 an Ohio corporation
  By:
    /s/  Richard M. Osborne  Name:Richard M. Osborne
  Title:
    Sole Shareholder  CLASS B LIMITED PARTNER:
  JOHN D. OIL AND GAS COMPANY,
 a Maryland corporation
  By:
    /s/  Thomas
    J. Smith  Name:Thomas J. Smith
  Title:
    President and Chief Operating Officer 34