Table ofContents

 

 

 

**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington, D.C. 20549**

** **

**FORM 10-Q**

** **

**(Mark One)**

 

**x****      QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934**

 

**For the quarterly periodended April 4, 2010**

 

**OR**

 

**o****         TRANSITIONREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934**

 

**For the transition period from                  to                  **

 

**Commission File No. 0-50848**

** **

**Voyager Oil & Gas, Inc.**

**(formerly known as ante4, Inc.)**

(Exact name ofregistrant as specified in its charter)

 

| **Delaware**                                                        | ** ** | **77-0639000**      |
|---------------------------------------------------------------------|------------|---------------------|
| (State or other  jurisdiction                                       |       | (I.R.S. Employer    |
| of incorporation or  organization)                                  |       | Identification No.) |
|                                                                |       |                |
| ****2812 1********st******** Avenue  North, Suite 506**** | ** ** | ** **          |
| ****Billings, Montana****                                           | ** ** | **59101**           |
| (Address of principal  executive offices)                           |       | (Zip Code)          |

 

Registrant’s telephone number, including area code:**(406) 245-4902**

 

Indicate by check markwhether the registrant (1) has filed all reports required to be filed by Section 13or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required tofile such reports), and (2) has been subject to such filing requirementsfor the past 90 days. Yes x No o

 

Indicate by check mark whether the registrant hassubmitted electronically and posted on its corporate Web site, if any, everyInteractive Data File required to be submitted and posted pursuant to Rule 405of Regulation S-T during the preceding 12 months (or for such shorter periodthat the registrant was required to submit and post such files). Yes o No o

 

Indicate by check mark whether the registrant is alarge accelerated filer, an accelerated filer, a non-accelerated filer, or asmaller reporting company. See definitions of “large accelerated filer,” “acceleratedfiler,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.(Check one):

 

| Large accelerated  filer o                |   | Accelerated filer o          |
|------------------------------------------------|--------|-----------------------------------|
|                                           |   |                              |
| Non-accelerated  filer o                  |   | Smaller reporting  company x |
| (Do not check if a smaller  reporting company) |   |                              |

 

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2 of theExchange Act).   Yes o No x

 

As of May 19, 2010,there were 45,344,431 shares of Common Stock, $0.001 par value per shareoutstanding.

 

 

 

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**VOYAGER OIL & GAS, INC.**

 

**INDEX**

 
| ** **    | ** **            | ** **                                                                                                                                                                   | **Page of**   |
|---------------|-----------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------|
| ** **    | ** **            | ** **                                                                                                                                                                   | **Form 10-Q** |
| PART I.  | FINANCIAL INFORMATION | ** **                                                                                                                                                                   |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 1.               | FINANCIAL STATEMENTS                                                                                                                                                         |               |
|          |                  |                                                                                                                                                                         |               |
|          |                  | Condensed Consolidated Balance Sheets as of  April 4, 2010 (unaudited) and January 3, 2010                                                                         | 1                  |
|          |                  |                                                                                                                                                                         |               |
|          |                  | Unaudited Condensed Consolidated Statements of Net  Earnings (Loss) and Comprehensive Earnings (Loss) for the three months ended  April 4, 2010 and March 29, 2009 | 2                  |
|          |                  |                                                                                                                                                                         |               |
|          |                  | Unaudited Condensed Consolidated Statements of Cash  Flows for the three months ended April 4, 2010 and March 29, 2009                                             | 3                  |
|          |                  |                                                                                                                                                                         |               |
|          |                  | Notes to Unaudited Condensed Consolidated Financial  Statements                                                                                                              | 4                  |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM  2.              | MANAGEMENT’S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                                                                                  | 9                  |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM  3.              | QUANTITATIVE  AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                                                                                  | 12                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM  4T.             | CONTROLS  AND PROCEDURES                                                                                                                                                     | 13                 |
|          |                  |                                                                                                                                                                         |               |
| PART II. | OTHER  INFORMATION    | 14                                                                                                                                                                           |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 1.               | LEGAL  PROCEEDINGS                                                                                                                                                           | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 1A.              | RISK FACTORS                                                                                                                                                                 | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM  2               | UNREGISTERED  SALES OF EQUITY SECURITIES AND USE OF PROCEEDS                                                                                                                 | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM  3               | DEFAULTS  UPON SENIOR SECURITIES                                                                                                                                             | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 4.               | (REMOVED  AND RESERVED)                                                                                                                                                      | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 5.               | OTHER MATTERS                                                                                                                                                                | 14                 |
|          |                  |                                                                                                                                                                         |               |
|          | ITEM 6.               | EXHIBITS                                                                                                                                                                     | 15                 |
|          |                  |                                                                                                                                                                         |               |
| SIGNATURES    |                  |                                                                                                                                                                         |

 

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**PART 1 — FINANCIALINFORMATION**

 

**ITEM 1. FINANCIAL STATEMENTS**

 

**VOYAGER OIL & GAS, INC. (formerly ante4, Inc.)**

**CONDENSED CONSOLIDATED BALANCESHEETS**

**AS OF APRIL 4, 2010 (UNAUDITED) AND JANUARY 3, 2010**

 
| ** **                                                                                                                                                                    | ** ** | **April 4, 2010**                     | ** ** | **January 3, 2010** | ** ** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|--------------------------------------------|------------|--------------------------|------------|
| ** **                                                                                                                                                                    | ** ** | **(In  thousands, except par value data)** | ** ** |
| ** **                                                                                                                                                                    | ** ** | ** **                                 | ** ** | ** **               | ** ** |
| **Assets**                                                                                                                                                                    |       |                                       |       |                     |       |
| Current  assets:                                                                                                                                                              |       |                                       |       |                     |       |
| Cash  and cash equivalents                                                                                                                                                    |       | $                                          | 18,210     |                     | $          | 16,775 |   |
| Investments  in debt securities and related put rights                                                                                                                        |       | 13,495                                     |       | 10,817                   |       |
| Accounts  receivable, net of allowances of $0 and $46                                                                                                                         |       | 229                                        |       | 747                      |       |
| Current  portion of Peerless Media Ltd. Contingent consideration receivable                                                                                                   |       | 379                                        |       | 379                      |       |
| Other                                                                                                                                                                         |       | 229                                        |       | 182                      |       |
| Total  Current Assets                                                                                                                                                         |       | 32,542                                     |       | 28,900                   |       |
|                                                                                                                                                                          |       |                                       |       |                     |       |
| Peerless  Media Ltd. Contingent consideration receivable, net of current portion                                                                                              |       | 7,199                                      |       | 7,199                    |       |
| Investments  in debt securities and put rights                                                                                                                                |       | —                                     |       | 4,770                    |       |
| Property  and equipment, net                                                                                                                                                  |       | 35                                         |       | 27                       |       |
| Other                                                                                                                                                                         |       | —                                     |       | 288                      |       |
| Total  Assets                                                                                                                                                                 |       | $                                          | 39,776     |                     | $          | 41,184 |   |
|                                                                                                                                                                          |       |                                       |       |                     |       |
| **Liabilities and Stockholders’ Equity**                                                                                                                                 |       |                                       |       |                     |       |
| Current  Liabilities:                                                                                                                                                         |       |                                       |       |                     |       |
| Accounts  payable                                                                                                                                                             |       | $                                          | 473        |                     | $          | 307 |   |
| Accrued  payroll and related                                                                                                                                                  |       | 5                                          |       | 12                       |       |
| Line  of credit                                                                                                                                                               |       | 2,436                                      |       | 2,549                    |       |
| Operating  lease reserve                                                                                                                                                      |       | 502                                        |       | 602                      |       |
| Royalties  payable                                                                                                                                                            |       | 415                                        |       | 415                      |       |
| Other  accrued expenses                                                                                                                                                       |       | 141                                        |       | 144                      |       |
| Income  taxes payable                                                                                                                                                         |       | —                                     |       | 575                      |       |
| Total  Current Liabilities                                                                                                                                                    |       | 3,972                                      |       | 4,604                    |       |
|                                                                                                                                                                          |       |                                       |       |                     |       |
| Commitments  and Contingencies                                                                                                                                                |       | —                                     |       | —                   |       |
|                                                                                                                                                                          |       |                                       |       |                     |       |
| Stockholders’  equity:                                                                                                                                                   |       |                                       |       |                     |       |
| Preferred  stock, $0.001 par value; authorized 20,000 shares; non issued or outstanding                                                                                       |       | —                                     |       | —                   |       |
| Common  stock, $0.001 par value; authorized 100,000 shares; 21,292 and 21,263 shares  issued and outstanding as of April 4, 2010 and January 3, 2010,  respectively |       | 21                                         |       | 21                       |       |
| Additional  paid-in capital                                                                                                                                                   |       | 45,938                                     |       | 45,927                   |       |
| Accumulated  Deficit                                                                                                                                                          |       | (10,156                                    | )          | (9,369                   | )          |
| Accumulated  other comprehensive gain                                                                                                                                         |       | 1                                          |       | 1                        |       |
|                                                                                                                                                                          |       | 35,804                                     |       | 36,580                   |       |
|                                                                                                                                                                          |       | $                                          | 39,776     |                     | $          | 41,184 |   |

 

Seenotes to unaudited condensed consolidated financial statements.

 

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**VOYAGER OIL & GAS, INC. (formerly ante4, Inc.)**

**UNAUDITED CONDENSED CONSOLIDATEDSTATEMENTS OF NET EARNINGS (LOSS) AND COMPREHENSIVE EARNINGS (LOSS)**

**FOR THE THREE MONTHS ENDED APRIL 4, 2010 AND MARCH 29, 2009**

 
| ** **                                                              | ** ** | **Three months ended**                    | ** ** |
|-------------------------------------------------------------------------|------------|-------------------------------------------|------------|
| ** **                                                              | ** ** | **April 4, 2010**                    | ** ** | **March 29, 2009** | ** ** |
| ** **                                                              | ** ** | **(In thousands, except per share data)** | ** ** |
| **Revenues:**                                                           |       |                                      |       |   |   |
| Television                                                              |       | $                                         | —     |   | $ | 3,565 |   |
| Product  licensing                                                      |       | —                                    |       | 678 |   |
| Online  gaming                                                          |       | —                                    |       | 136 |   |
| Event  hosting and sponsorship fees                                     |       | —                                    |       | 573 |   |
| Other                                                                   |       | —                                    |       | 575 |   |
|                                                                    |       | —                                    |       | 5,527 |   |
|                                                                    |       |                                      |       |   |   |
| **Cost of revenues**                                                    |       | —                                    |       | 2,065 |   |
| Gross  profit                                                           |       | —                                    |       | 3,462 |   |
|                                                                    |       |                                      |       |   |   |
| **Selling, general and administrative expense**                         |       | 857                                       |       | 3,183 |   |
| **Asset impairment**                                                    |       | —                                    |       | 1,000 |   |
| Loss  from operations                                                   |       | (857                                      | )          | (721 | ) |
|                                                                    |       |                                      |       |   |   |
| **Other income:**                                                       |       |                                      |       |   |   |
| Gain  on sale of investment                                             |       | 11                                        |       | — |   |
| Interest,  net                                                          |       | 57                                        |       | 71 |   |
| Other                                                                   |       | 5                                         |       | — |   |
| Loss  from continuing operations before income taxes                    |       | (784                                      | )          | (650 | ) |
|                                                                    |       |                                      |       |   |   |
| **Income taxes**                                                        |       | —                                    |       | 129 |   |
| Loss  from continuing operations                                        |       | (784                                      | )          | (521 | ) |
|                                                                    |       |                                      |       |   |   |
| **Loss from discontinued operations, net of income taxes**              |       | —                                    |       | (984 | ) |
| **Net loss**                                                            |       | (784                                      | )          | (1,505 | ) |
|                                                                    |       |                                      |       |   |   |
| Unrealized  loss on securities                                          |       | —                                    |       | (7 | ) |
|                                                                    |       |                                      |       |   |   |
| **Comprehensive Loss**                                                  |       | $                                         | (784       | ) | $ | (1,512 | ) |
|                                                                    |       |                                      |       |   |   |
| Loss  per common share from continuing operations - basic and diluted   |       | $                                         | (0.04      | ) | $ | (0.02 | ) |
| Loss  per common share from discontinued operations - basic and diluted |       | —                                    |       | (0.05 | ) |
| **Net loss per common share - basic and diluted**                       |       | $                                         | (0.04      | ) | $ | (0.07 | ) |
|                                                                    |       |                                      |       |   |   |
| **Weighted-average common shares outstanding - basic and  diluted**     |       | 21,263                                    |       | 20,603 |   |

 

Seenotes to unaudited condensed consolidated financial statements.

 

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**VOYAGER OIL & GAS, INC. (formerly ante4, Inc.)**

**UNAUDITED CONDENSED CONSOLIDATEDSTATEMENTS OF CASH FLOWS**

**FOR THE THREE MONTHS ENDED APRIL 4, 2010 AND MARCH 29, 2009**

 
| ** **                                                                                                          | ** ** | **Three months ended** | ** ** |
|---------------------------------------------------------------------------------------------------------------------|------------|------------------------|------------|
| ** **                                                                                                          | ** ** | **April 4, 2010** | ** ** | **March 29, 2009** | ** ** |
| ** **                                                                                                          | ** ** | **(In thousands)**     | ** ** |
| **Operating Activities:**                                                                                           |       |                   |       |   |   |
| Net  loss                                                                                                           |       | $                      | (784       | ) | $ | (1,505 | ) |
| Adjustments  to reconcile net loss to net cash provided by (used in) operating activities  of continuing operations |       |                   |       |   |   |
| Loss  from discontinued operations                                                                                  |       | —                 |       | 984 |   |
| Depreciation  and amortization                                                                                      |       | 4                      |       | 194 |   |
| Share-based  compensation                                                                                           |       | —                 |       | 60 |   |
| Asset  impairment                                                                                                   |       | —                 |       | 1,000 |   |
| Loss  on sale of assets                                                                                             |       | —                 |       | 22 |   |
| Change  in value of put rights                                                                                      |       | 10                     |       | 211 |   |
| Change  in value of ARS portfolio                                                                                   |       | (15                    | )          | (211 | ) |
| Bad  debt provision                                                                                                 |       | —                 |       | 239 |   |
| Increase  in operating (assets) and liabilities:                                                                    |       |                   |       |   |   |
| Accounts  receivable                                                                                                |       | 601                    |       | 2 |   |
| Deferred  television costs                                                                                          |       | —                 |       | 558 |   |
| Other                                                                                                               |       | 238                    |       | 207 |   |
| Accounts  payable                                                                                                   |       | 166                    |       | (46 | ) |
| Accrued  expenses                                                                                                   |       | (685                   | )          | (155 | ) |
| Deferred  revenue                                                                                                   |       | —                 |       | (966 | ) |
| Net  cash provided by (used in) operating activities of continuing operations                                       |       | (465                   | )          | 594 |   |
| Net  cash used in operating activities of discontinued operations                                                   |       | —                 |       | (440 | ) |
| Net  cash provided by (used in) operating activities                                                                |       | (465                   | )          | 154 |   |
|                                                                                                                |       |                   |       |   |   |
| **Investing Activities:**                                                                                           |       |                   |       |   |   |
| Purchase  of property and equipment                                                                                 |       | (12                    | )          | (59 | ) |
| Sale  of available for sale securities                                                                              |       | 2,014                  |       | — |   |
| Net  cash provided by (used in) investing activities                                                                |       | 2,002                  |       | (59 | ) |
|                                                                                                                |       |                   |       |   |   |
| **Financing Activities:**                                                                                           |       |                   |       |   |   |
| Borrowing  under line of credit                                                                                     |       | 7                      |       | 2,661 |   |
| Repayments  under line of credit                                                                                    |       | (120                   | )          | (10 | ) |
| Proceeds  from exercise of stock options                                                                            |       | 11                     |       | 1 |   |
| Net  cash provided by (used in) financing activities                                                                |       | (102                   | )          | 2,652 |   |
|                                                                                                                |       |                   |       |   |   |
| **Net increase in cash and cash equivalents**                                                                       |       | 1,435                  |       | 2,747 |   |
| Cash  and cash equivalents at beginning of period                                                                   |       | 16,775                 |       | 11,497 |   |
| Cash  and cash equivalents at end of period                                                                         |       | $                      | 18,210     |   | $ | 14,244 |   |
|                                                                                                                |       |                   |       |   |   |
| **Supplemental Cash Flow Information:**                                                                             |       |                   |       |   |   |
| Cash  paid for interest                                                                                             |       | $                      | —     |   | $ | 2 |   |
| Cash  paid for income taxes                                                                                         |       | $                      | 695        |   | $ | — |   |

 

Seenotes to unaudited condensed consolidated financial statements.

 

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**VOYAGEROIL & GAS, INC.****(formerly ante4, Inc.)**

**(Formerlyante4, Inc.)**

**Notes to Unaudited CondensedConsolidated Financial Statements**

 

**1.BUSINESS AND BASIS OF PRESENTATION**

 

These condensedconsolidated financial statements present the financial condition and resultsof operations of Voyager Oil & Gas, Inc. (formerly ante4, Inc.(Note 11)), (the “Company,” or “Voyager”), as of the dates and for the periodsindicated.  On April 16, 2010, the Company, Plains Energy Acquisition, Inc.(“Acquisition Sub”) and Plains Energy Investments, Inc. (“the TargetCompany”) entered into an Agreement and Plan of Merger (the “Merger Agreement”).  Under the Merger Agreement, Acquisition Submerged with and into the Target Company, with the Target Company remaining asthe surviving corporation and a wholly-owned subsidiary of the Company (the “Merger”).  On the Closing Date, the Company filed aCertificate of Amendment with the State of Delaware to change its name fromante4, Inc. to Voyager Oil & Gas, Inc.  Going forward, the Company will be a holdingcompany parent of the Target Company, and the Company’s business operationsfollowing the Merger will be those of the Target Company.

 

The condensedconsolidated financial statements have been prepared pursuant to the rules andregulations of the Securities and Exchange Commission applicable to interimfinancial information. Accordingly, certain information normally included inannual financial statements prepared in accordance with accounting principlesgenerally accepted in the United States of America (“GAAP”) has been condensedor omitted. For further information, please refer to the annual auditedfinancial statements of the Company, and the related notes, included in theCompany’s Annual Report on Form 10-K for the fiscal year ended January 3,2010, from which the information as of that date is derived. Subsequent eventswere evaluated to determine if adjustments to or disclosure in these condensedconsolidated financial statements were necessary. Certain  reclassifications were made for comparabilitywith the current period presentation, specifically cash equivalents and currentinvestment in debt securities balances.

 

In the opinion of management,all adjustments considered necessary for a fair presentation have beenincluded. The results for the current interim periods are not necessarilyindicative of the results to be expected for the full year. The accountingestimates that require the most significant, difficult and subjective judgmentsinclude the:

 

·                  valuation of investments in debtsecurities and put rights;

·                  valuation of non-marketable equityinvestments; and

·                  determination of current and deferredincome taxes;

 

**2. NEWACCOUNTING STANDARDS**

 

In February 2010,the FASB issued ASU 2010-09, “Subsequent Events (Topic 855) - Amendments toCertain Recognition and Disclosure Requirements.” ASU 2010-09 requires anentity that is an SEC filer to evaluate subsequent events through the date thatthe financial statements are issued and removes the requirement that an SECfiler disclose the date through which subsequent events have been evaluated.ASC 2010-09 was effective upon issuance. The adoption of this standard had noeffect on the Company’s results of operations or financial position.

 

In April 2010, theFASB issued ASU 2010-13, “Compensation - Stock Compensation (Topic 718) -Effect of Denominating the Exercise Price of a Share-Based Payment Award in theCurrency of the Market in Which the Underlying Equity Security Trades.” ASU2010-13 provides amendments to Topic 718 to clarify that an employeeshare-based payment award with an exercise price denominated in the currency ofa market in which a substantial portion of the entity’s equity securitiestrades should not be considered to contain a condition that is not a market,performance, or service condition. Therefore, an entity would not classify suchan award as a liability if it otherwise qualifies as equity. The amendments inASU 2010-13 are effective for fiscal years, and interim periods within thosefiscal years, beginning on or after December 15, 2010. The adoption ofthis standard will not have an effect on the Company’s results of operations orfinancial position.

 

From time to time, newaccounting pronouncements are issued by FASB that are adopted by the Company asof the specified effective date.  If not discussed, managementbelieves that the impact of recently issued standards, which are not yeteffective, will not have a material impact on the Company’s financialstatements upon adoption.

 

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**3.CONTINGENT CONSIDERATION RECEIVABLE**

 

As a result of atransaction between the Company and Peerless Media Ltd. (“Buyer”) during fiscalyear 2009, pursuant to which, the Company sold substantially all of itsoperating assets (the “Transaction”), the Company is entitled to receive, inperpetuity, 5% of gross gaming revenue and 5% of other revenue of the Buyergenerated by our former business and assets that was sold to Buyer in theTransaction.  Buyer has guaranteed a minimum payment to us of $3 millionfor such revenue over the three-year period following the closing of theTransaction.  The Company prepared a discounted cash flow model todetermine an estimated fair value of this portion of the purchase price as of November 2,2009.  This value is recorded on the balance sheet as of January 3,2010 and remains unchanged on the balance sheet as of April 4, 2010.  In connection with the Merger describedabove, on April 16, 2010 the Company distributed this asset to awholly-owned subsidiary, ante5, Inc. As soon as is practicable following the Merger, ante5 intends to file aregistration statement on Form 10 and an Information Statement with theSecurities and Exchange Commission for the purpose of spinning off the ante5shares from the Company to the stockholders of record of the Company on April 15,2010.

 

**4.INVESTMENTS IN DEBT SECURITIES AND PUT RIGHTS**

 

As of April 4, 2010,investments in debt securities and put rights consist of the following (inthousands):

 
| **Description**                                   | ** ** | **Cost** | ** ** | **Unrealized  Gains/(Losses)** | ** ** | **Fair Value** | ** ** |
|---------------------------------------------------|------------|----------|------------|--------------------------------|------------|---------------------|------------|
| **Maturity less than 1 year** |       |     |       |                           |       |                |       |
| Auction  rate securities (trading securities)     |       | $        | 3,365      |                           | $          |                | $          | 3,365 |   |
| Put  rights (trading securities)                  |       | 335      |       |                           |       | 335                 |       |
| Corporate  bonds (available for sale)             |       | 1,714    |       | 10                             |       | 1,724               |       |
| Certificates  of deposit (available for sale)     |       | 5,285    |       | 6                              |       | 5,291               |       |
|                                              |       |     |       |                           |       |                |       |
|                                              |       | $        | 10,699     |                           | $          | 16                  |       | $ | 10,715 |   |
|                                                   |            |          |            |                                |            |                     |            |  |  |  |

 
| **Description**                                    | ** ** | **Cost** | ** ** | **Unrealized  Gains/(Losses)** | ** ** | **Fair Value** | ** ** |
|----------------------------------------------------|------------|----------|------------|--------------------------------|------------|---------------------|------------|
| **Maturity 1 year to 5 years** |       |     |       |                           |       |                |       |
| Corporate  bonds (available for sale)              |       | $        | 1,827      |                           | $          | (11                 | )          | $ | 1,816 |   |
| Certificates  of deposit (available for sale)      |       | 962      |       | 2                              |       | 964                 |       |
|                                               |       | $        | 2,789      |                           | $          | (9                  | )          | $ | 2,780 |   |

 

Investments in debt andother securities that are classified as available for sale or tradingsecurities are the only assets or liabilities that the Company is required tomeasure at their estimated fair value on a recurring basis. The estimated fairvalue is determined using inputs from among the three levels of the fair valuehierarchy set forth in FASB ASC Topic 820 as follows:

 

Level 1 inputs  —Unadjusted quoted prices in active markets for identical assets or liabilities,which prices are available at the measurement date.

 

Level 2 inputs — Quotedprices for similar assets and liabilities in active markets, quoted prices foridentical or similar assets and liabilities in markets that are not active,inputs other than quoted prices that are observable for the asset or liability(*i.e.*, interest rates, yieldcurves, *etc.*) and inputs that arederived principally from or corroborated by observable market data bycorrelation or other means (market corroborated inputs).

 

Level 3 inputs —Unobservable inputs that reflect management’s estimates about the assumptionsthat market participants would use in pricing the asset or liability in anorderly market. Management develops these inputs based on the best informationavailable, including internally-developed data and other valuation models.

 

In estimating fair value,the Company utilizes valuation techniques that maximize the use of observableinputs and minimize the use of unobservable inputs to the extent possible. Noneof the Company’s financial instruments are measured based on Level 2 inputs.

 

As of April 4, 2010,financial assets that are measured and recorded at fair value on a recurringbasis consist of the following (in thousands):

 

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| **Description**                       | ** ** | **Level 1** | ** ** | **Level 3** | ** ** | **Total** | ** ** |
|---------------------------------------|------------|------------------|------------|------------------|------------|-----------|------------|
| Corporate  bonds                      |       | $                | 3,540      |             | $          | —    |       | $ | 3,540 |   |
| Certificates  of deposit              |       | 6,255            |       | —           |       | 6,255     |       |
| Auction  rate securities              |       | —           |       | 3,365            |       | 3,365     |       |
| Put  rights                           |       | —           |       | 335              |       | 335       |       |
| Total  assets at estimated fair value |       | $                | 9,795      |             | $          | 3,700     |       | $ | 13,495 |   |

 

For financialassets that utilize Level 1 inputs, the Company utilizes direct observableprice quotes in active markets for identical assets. Due to the lack ofobservable market quotes on the Company’s auction rate securities (“ARS”)portfolio and related put rights, the Company utilizes valuation models thatrely exclusively on Level 3 inputs including those that are based on management’sestimates of expected cash flow streams and collateral values, default riskunderlying the security, long term broker credit rating, discount rates andoverall capital market liquidity. The valuation of the Company’s ARS portfolioand related put rights is subject to uncertainties that are difficult topredict. Factors that may affect the estimated fair value include changes tocredit ratings of ARS as well as to the assets collateralizing the securities,rates of default of the underlying assets and collateral value, broker defaultrisk, discount rates, and evolving market conditions affecting the liquidity ofARS.

 

The following tablesummarizes activity in the Company’s ARS portfolio and put rights (inthousands):

 
| **Description**                                         | ** ** | **ARS** | ** ** | **Put Rights** | ** ** | **Total** | ** ** |
|---------------------------------------------------------|------------|---------|------------|---------------------|------------|-----------|------------|
| Balance  — January 3, 2010                    |       | $       | 3,455      |                | $          | 345       |       | $ | 3,800 |   |
| Change  in value of put rights, included in earnings    |       | —  |       | (10                 | )          | (10       | )          |
| Change  in value of ARS portfolio, included in earnings |       | 10      |       | —              |       | 10        |       |
| Settlements,  net of purchases                          |       | (100    | )          | —              |       | (100      | )          |
| Balance  — April 4, 2010                      |       | $       | 3,365      |                | $          | 335       |       | $ | 3,700 |   |

 

In November 2008,the Company accepted an offer from UBS AG (“UBS”) that created new rights andobligations related to the ARS portfolio (the “Put Rights”). The Put Rightspermit the Company to require UBS to purchase the ARS at par value, at any timeduring the period of June 30, 2010 through July 2, 2012. UBS also hasthe right, in its discretion, to purchase or sell the ARS at any time until July 2,2012, so long as par value is received. The Company expects to sell the ARSunder the Put Rights. However, if the Put Rights are not exercised before July 2,2012 they will expire and UBS will have no further obligation to buy the ARS.

 

UBS’s obligations underthe Put Rights are not secured by its assets and do not require UBS to obtainany financing to support its performance obligations under the Put Rights. UBShas disclaimed any assurance that it will have sufficient financial resourcesto satisfy its obligations under the Put Rights and UBS’s obligations are notguaranteed by any other party.

 

The Put Rights representan asset that is separate from the ARS. The Company initially recorded $605,000as the fair value of the Put Rights asset in interest income. The Company alsoelected to measure the Put Rights at fair value under FASB ASC Topic 825, whichpermits an entity to elect the fair value option for recognized financialassets. As a result, unrealized gains and losses are included in interestincome and the value of the Put Rights decreased by $10,000 in the three monthsended April 4, 2010. The Company did not elect the fair value option forits other financial assets and liabilities.

 

In connection with theacceptance of the UBS offer in November 2008, the Company transferred theARS from investments available-for-sale to trading securities in accordancewith ASC 320. The transfer to trading securities reflects management’s intentto exercise the Put Rights during the period June 30, 2010 to July 3,2012. Prior to the agreement with UBS, the Company’s intent was to hold the ARSuntil the market recovered. At the time of transfer, the $605,000 unrealizedloss on ARS was included in accumulated other comprehensive gain (loss). Upontransfer to trading securities, the Company recognized a $605,000 reduction ininterest income. Unrealized gains and losses are included in interest incomeand the value of the ARS portfolio increased by $10,000 in the three monthsended April 4, 2010. Prior to accepting the UBS offer, the ARS wererecorded as investments available-for-sale.

 

UBS provided the Companywith a line of credit, secured by ARS held by UBS, equal to 75% of theestimated fair value of the ARS. The Company borrowed $2,661,000 under the lineof credit from UBS in February 2009. Interest is charged at the actualinterest rate earned by the ARS. The line of credit is due upon demand. At April 4,2010, $2,436,000 was outstanding under the line of credit, with an additional$88,000 remaining credit available to the Company under the line of credit.

 

**5. FAIRVALUES OF FINANCIAL INSTRUMENTS**

 

The carryingamount of cash equivalents approximates fair value as measured using level 1inputs due to the short period of time to maturity and observable inputs inactive markets. Investments in debt securities and put rights are measured andrecorded at fair value on a recurring basis and information about theseinvestments is in Note 4. The fair value of the Company’s line of credit is not

 

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practicable to estimatebecause the line of credit, the ARS collateral, the Put Rights and thesettlement of certain litigation rights are all interrelated and result from asettlement by UBS with regulators, attorneys general and others.

 

As of April 4,2010, the estimated fair values of financial instruments are as follows (inthousands):

 
| ** **                                     | ** ** | **Carrying  Amount** | ** ** | **Fair  Value** | ** ** |
|------------------------------------------------|------------|----------------------|------------|-----------------|------------|
| Cash  equivalents                              |       | $                    | 18,060     |            | $          | 18,060 |   |
| Investments  in debt securities and put rights |       | 13,495               |       | 13,495          |       |
| Line  of credit                                |       | (2,436               | )          | Not estimated   |       |
|                                                |            |                      |            |                 |            |  |  |

 

**6.SHARE-BASED COMPENSATION**

 

All stock option expensewas recorded as of January 4, 2010 resulting from the acceleration of alloptions from the asset sale to Peerless Media, as well as the cancellation ofunvested CEO stock options on January 1, 2010.  The following tablesummarizes stock option activity during the three months ended April 4,2010:

 
| ** **                           | ** ** | ** **               | ** ** | **Number of Common Shares** | ** ** |
|--------------------------------------|------------|--------------------------|------------|--------------------------------------------|------------|
| ** **                           | ** ** | **Options  outstanding** | ** ** | **Exercisable**                            | ** ** | **Weighted********ave. exercise  price** | ** ** |
| **Balances at January 3, 2010** |       | 324,666                  |       | 324,666                                    |       | $ | 3.53 |   |
| Granted                              |       | —                   |       | —                                     |       | — |   |
| Forfeited/exchanged                  |       | (26,666                  | )          | (26,666                                    | )          | 2.21 |   |
| Exercised                            |       | (29,000                  | )          | (29,000                                    | )          | 0.37 |   |
| **Balances at April 4, 2010**   |       | 269,000                  |       | 269,000                                    |       | $ | 3.12 |   |

 

**7.INCOME TAXES**

 

Deferred income taxassets and liabilities are determined based upon differences between thefinancial reporting and tax bases of assets and liabilities and are measuredusing the enacted tax rates and laws that will be in effect when thedifferences are expected to reverse.   The Company does not expect topay any federal or state income tax for 2010 as a result of the losses recordedduring the quarter ended April 4, 2010 as well as additional lossesexpected for the remainder of 2010. Accounting standards require the consideration of a valuation allowancefor deferred tax assets if it is “more likely than not” that some component orall of the benefits of deferred tax assets will not be realized.  Asof April 4, 2010, the Company maintains a full valuation allowance for alldeferred tax assets.  Based on theserequirements no provision for income taxes has been recorded for the periodended April 4, 2010. There were no recorded unrecognized tax benefits atthe end of the reporting period.

 

**8. NETEARNINGS (LOSS) PER COMMON SHARE**

 

Basic net earnings/(loss)per common share is calculated by dividing net earnings (loss) by theweighted-average number of common shares outstanding during the period. Dilutedearnings per common share is calculated by adjusting weighted-averageoutstanding shares, assuming the conversion of all potentially dilutive stockoptions and awards (common stock equivalents). However, common stockequivalents are not used to calculate diluted per share amounts for lossperiods because the effect would be anti-dilutive.  The Company excluded 269,000 and 1,784,000outstanding stock options for the three months ended April 4, 2010 and March 29,2009, respectively, from the calculation of diluted net loss per common sharebecause they are considered anti-dilutive.

 

**9.CONTINGENCIES**

 

The Company is involvedin various inquiries, administrative proceedings and litigation relating tomatters arising in the normal course of business. The Company is not currentlya defendant in any material litigation and is not aware of any threatenedlitigation that could have a material effect on the Company. Management is notable to estimate the minimum loss to be incurred, if any, as a result of thefinal outcome of these matters but believes they are not likely to have amaterial adverse effect upon the Company’s financial position or results ofoperations and, accordingly, no provision for loss has been recorded.

 

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**10.SEGMENT INFORMATION**

 

As a result of the saledescribed in Note 3, there is no operating segment activity to report for thethree months ended April 4, 2010 as there are no operating segments.  The operating segments reported below are thesegments of the Company for which separate financial information is availableand for which operating results are evaluated by the chief operating decisionmaker in deciding how to allocate resources and in assessing performance.

 

**Threemonths ended March 29, 2009 (in thousands):**

 
| ** **                         | ** ** | **WPT**     | ** ** | **WPT Online** | ** ** | **WPT Global** | ** ** | ** **    | ** ** | ** **    | ** ** |
|------------------------------------|------------|-------------|------------|---------------------|------------|---------------------|------------|---------------|------------|---------------|------------|
| ** **                         | ** ** | **Studios** | ** ** | **Gaming**          | ** ** | **Non-gaming**      | ** ** | **Marketing** | ** ** | **Corporate** | ** ** | **Total** | ** ** |
| Revenues:                          |       |        |       |                |       |                |       |          |       |          |       |   |   |
| Television                         |       | $           | 3,565      |                | $          | —              |       | $             | —     |          | $          | — |   | $ | — |   | $ | 3,565 |   |
| Product  licensing                 |       | —      |       | —              |       | —              |       | 678           |       | —        |       | 678 |   |
| Online  gaming                     |       | —      |       | 136                 |       | —              |       | —        |       | —        |       | 136 |   |
| Event  hosting and sponsorship     |       | 350         |       | —              |       | —              |       | 223           |       | —        |       | 573 |   |
| Other                              |       | —      |       | —              |       | 544                 |       | 31            |       | —        |       | 575 |   |
|                               |       | 3,915       |       | 136                 |       | 544                 |       | 932           |       | —        |       | 5,527 |   |
| Cost  of revenues                  |       | 1,689       |       | —              |       | 297                 |       | 79            |       | —        |       | 2,065 |   |
| Gross  profit                      |       | 2,226       |       | 136                 |       | 247                 |       | 853           |       | —        |       | 3,462 |   |
| Total  assets (1)                  |       | 3,089       |       | 60                  |       | 782                 |       | 560           |       | 21,451        |       | 25,942 |   |
| Depreciation  and amortization (1) |       | 75          |       | —              |       | 73                  |       | —        |       | 46            |       | 194 |   |
|                                    |            |             |            |                     |            |                     |            |               |            |               |            |  |  |  |  |  |  |  |  |

 

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(1)          The total excludes $72 of total assets and $8 ofdepreciation and amortization for discontinued WPT China operations.

 

Revenues attributed todomestic and international operations were $3.3 million and $2.2 million,respectively.

 

**11.SUBSEQUENT EVENTS**

 

On April 16, 2010,the Company, Acquisition Sub and the Target Company entered into the MergerAgreement.  Under the Merger Agreement,Acquisition Sub merged with and into the Target Company, with the TargetCompany remaining as the surviving corporation and a wholly-owned subsidiary ofthe Company.  On the Closing Date, theCompany filed a Certificate of Amendment with the State of Delaware to changeits name from ante4, Inc. to Voyager Oil & Gas, Inc.  Going forward, Voyager will be a holdingcompany parent of the Target Company, and Voyager’s business operationsfollowing the Merger will be those of the Target Company.

 

The following tablesummarizes the fair value of assets acquired and liabilities assumed (inthousands):

 
| Assets  acquired                                     |   |   |   |
|------------------------------------------------------|--------|--------|--------|
| Cash                                                 |   | $      | 244    |   |
| Trade  receivables                                   |   | 20     |   |
| Short-term  investments                              |   | — |   |
| Other  current assets                                |   | 19     |   |
| Oil  and Gas Properties, Full Cost Method            |   | 10,004 |   |
| Other  Property and Equipment                        |   | 22     |   |
| Less:  accumulated depreciation and depletion        |   | (9     | )      |
| Total  assets acquired                               |   | 10,300 |   |
| Liabilities  assumed                                 |   |   |   |
| Accounts  payable                                    |   | 51     |   |
| Other  current liabilities                           |   | 3      |   |
| Due  to related parties                              |   | 1,725  |   |
| Total  fair value of assets and liabilities acquired |   | $      | 8,521  |   |

 

On May 7, 2010, theCompany acquired assignments of certain oil leases in Williams and McKenzieCounties, North Dakota for a total purchase price of $1,641,891 forapproximately 3,298 net acres.

 

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On April 26, 2010, fourholders of the Company’s warrants exercised such warrants on a cashlessexercise basis.  In connection with theseexercises the Company issued 2,250,796 shares of Common Stock.

 

On May 14, 2010, theCompany acquired assignments of certain oil leases in Richland County, Montanafor a total purchase price of $2,634,209 for approximately 5,268 net acres.

 

**ITEM2.  MANAGEMENT’S DISCUSSION AND ANALYSISOF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

 

**Overview**

 

The Company is a Delawarecorporation formed for the purpose of providing capital investments for acreageacquisitions and working interests in existing or planned hydrocarbon productionwith a special focus on scaleable, repeatable natural gas plays withestablished operators.  Our business isinitially expected to focus on properties in Montana and North Dakota.  We do not intend to limit our focus to anysingle geographic area, however, because we want to remain flexible and intendto pursue the best opportunities available to it.  Our required capital commitment may grow ifthe opportunity presents itself and depending upon the results of initialtesting and development activities.

 

On April 16, 2010,the Company, Acquisition Sub and the Target Company entered into the MergerAgreement.  Under the Merger Agreement,Acquisition Sub merged with and into the Target Company, with the TargetCompany remaining as the surviving corporation and a wholly-owned subsidiary ofthe Company.  On the Closing Date, theCompany filed a Certificate of Amendment with the State of Delaware to changeits name from ante4, Inc. to Voyager Oil & Gas, Inc. (“Voyager”).  Going forward, Voyager will be a holdingcompany parent of the Target Company, and Voyager’s business operationsfollowing the Merger will be those of the Target Company.

 

When operating our formerbusiness, we created internationally branded entertainment and consumerproducts driven by the development, production and marketing of televisedprogramming based on gaming themes. The current season of the World PokerTour®, or WPT® television series - Season Eight, based on a series ofhigh-stakes poker tournaments, currently airs on Fox Sports Net in the UnitedStates, and has been licensed for broadcast globally. In January 2008, welaunched ClubWPT.com, an innovative subscription-based online poker clubtargeted to the estimated 60 million poker players in the United States, whichis currently offered in 38 states. Through November 2008, we offered areal-money online gaming website which prohibited wagers from players in theU.S. and other restricted jurisdictions. We also licensed our brand tocompanies in the business of poker equipment and instruction, apparel,publishing, electronic and wireless entertainment, DVD/home entertainment,casino games and giftware and were engaged in the sale of corporatesponsorships. In addition, through March 2009, we developed and marketedonline and mobile games supporting the WPT China National Traktor Poker TourTM.

 

Because the mergeroccurred subsequent to the end of our first fiscal quarter of 2010, except asspecifically described below, the following description of our businessdescribes our business prior to the closing of the merger.

 

**Business**

 

Voyager’s primary focusis to acquire high value leasehold interests specifically targeting oil shaleresource prospects in the continental United States.  We believe ourcompetitive advantage will be our ability to continue to acquire leasesdirectly from the mineral owners through “organic leasing.”  Organicleasing allows Voyager to acquire acreage on more favorable terms than ourcompetitors.  Because of our size and maneuverability, we are able todeploy our land acquisition teams into specific areas based on the latestindustry information.  We will generate revenue by and through theconversion of our leasehold into non-operated working interests in multipleBakken, Three Forks and other oil shale wells.  We believe our drillingparticipation, primarily on a heads-up basis proportionate to our workinginterest, will allow us to deliver high value with low cost.  Voyagerexpects to deploy approximately $10 million to participate in oil shale wellsin 2010 at an average completion cost of $4.5 million per well.

 

Voyager is also currentlyengaged in a top-leasing program in targeted areas of the WillistonBasin.  A top-lease is a lease acquired prior to and commencingimmediately upon the expiration of the current lease.  We believe thisapproach will allow us to access the most prolific areas of the Bakkenoilfields.  We continue to see this approach met with success given therapidly expanding nature of the productive area of the play.

 

Voyager explores andproduces oil and gas through a non-operated business model.  We engage inthe drilling process within operators’ drilling units that include ouracreage.  As a non-operator we rely on our operating partners to propose,permit and engage in the drilling process.  Before a well is spud, theoperator is required to provide all oil and gas interest owners in thedesignated well unit the opportunity to participate in the drilling costs andrevenues of the well on a pro-rata basis.  After the well is completed,our 

 

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operating partners alsotransport, market and account for all production.  It will be policy forVoyager to engage and participate on a heads-up basis in substantially all, ifnot all, wells proposed.  This model provides us with diversificationacross operators and geologic areas.  It also allows us to continue to addproduction at a low marginal cost and maintain general and administrative costsat minimal levels.

 

**Operations**

 

We plan to continue tostructure our operations in a manner that minimizes overhead and relies onthird-parties to supply experience and expertise necessary to exploitexploration opportunities.  We will attempt to secure the highest possibleworking interests in the wells in which we invest while minimizing our generaland administrative expenses.  We intend to keep overhead and staff to abare minimum and the majority of operational duties will be outsourced toconsultants and independent contractors.  We believe that the operationalresponsibilities of our company can be handled by our current officers, ourworking partnership with Hancock Enterprises and through consulting andindependent contractor relationships.  We believe that we will incurminimal general and administrative expenses, thus devoting substantially all ofour capital to hydrocarbon investments.

 

**Assetsand Acreage Holdings**

 

Asof May 18, 2010 we currently control approximately 112,000 net acres inthe following four primary prospect areas:

 

·                  21,000 netacres targeting the Bakken formation in North Dakota and Montana;

 

·      640 net acres targeting the Red Riverformation based on 3-D seismic data in Montana;

 

·      57,000 net acres in our joint venturetargeting the Tiger Ridge gas field    inBlaine, Hill and Chouteau Counties of Montana; and

 

·      33,500 net acres in our joint venturetargeting the Heath Shale   formation inMusselshell, Petroleum, Garfield and Fergus Counties of Montana.

 

4,000of the 21,000 net acres we currently control in the Bakken formation of NorthDakota and Montana are under contract and we expect to close in July of2010.  The leases we control have aminimum term of three years and many have extensions effectively giving uscontrol of lands for up to ten years.

 

**Critical Accounting Policies andEstimates**

 

Ourmanagement’s discussion and analysis of financial conditions and results ofoperations is based on the Company’s financial statements, which have beenprepared in accordance with accounting principles generally accepted in theUnited States, or GAAP.  The preparationof these financial statements required us to make estimates and judgments thataffect the reported amounts of assets, liabilities and expenses.  On an ongoing basis, we evaluate theseestimates and judgments, including those described below.  We base our estimates on our historicalexperience and on various other assumptions that we believe to be reasonableunder the circumstances.  These estimatesand assumptions form the basis for making judgments about the carrying valuesof assets and liabilities that are not readily apparent from othersources.  Actual results and experiencesmay differ materially from these estimates.

 

While our significantaccounting policies are more fully described in notes to our financialstatements to be filed with the SECon a Form 8-K/A within 71 days of the date that this initial report on Form 8-K,we believe that the following accounting policies are the most critical to aidyou in fully understanding and evaluating our reported financial results andaffect the more significant judgments and estimates that we used in thepreparation of our financial statements.

 

*Stock-Based Compensation*

 

We have accounted forstock-based compensation under the provisions of FASB Accounting StandardsCodification (ASC) 718-10-55 (*Priorauthoritative literature:*FASB Statement 123(R), *Share-Based Payment).*  This statement requires us to record anyexpense associated with the fair value of stock-based compensation.  We used the Black-Scholes option valuationmodel to calculate stock based compensation at the date of grant.  Option pricing models require the input ofhighly subjective assumptions, including the expected price volatility.  Changes in these assumptions can materiallyaffect the fair value estimate.

 

*Full Cost Method*

 

We follow the full costmethod of accounting for oil and gas operations whereby all costs related tothe exploration and development of oil and gas properties are initiallycapitalized into a single cost center (“full cost pool”).  Such costsinclude land

 

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acquisition costs, geologicaland geophysical expenses, carrying charges on non-producing properties, costsof drilling directly related to acquisitions, and exploration activities.

 

Proceeds from propertysales will generally be credited to the full cost pool, with no gain or lossrecognized, unless such a sale would significantly alter the relationshipbetween capitalized costs and the proved reserves attributable to thesecosts.  A significant alteration would typically involve a sale of25% or more of the proved reserves related to a single full costpool.  There were no property sales for the three months ended April4, 2010 and March 29, 2009.

 

Capitalized costsassociated with impaired properties and capitalized cost related to propertieshaving proved reserves, plus the estimated future development costs and assetretirement costs under FASB ASC 410-20-25 (*Priorauthoritative literature:,*FASB Statement 143, *Accounting for Asset Retirement Obligations)*will be depleted and amortized on theunit-of-production method based on the estimated gross proved reserves asdetermined by independent petroleum engineers.  The costs of unprovedproperties are withheld from the depletion base until such time as they areeither developed or abandoned.  When proved reserves are assigned orthe property is considered to be impaired, the cost of the property or theamount of the impairment is added to costs subject to depletion calculations.

 

Capitalized costs of oiland gas properties (net of related deferred income taxes) may not exceed anamount equal to the present value, discounted at 10% per annum, of theestimated future net cash flows from proved oil and gas reserves plus the costof unevaluated properties (adjusted for related income taxeffects).  Should capitalized costs exceed this ceiling, impairmentis recognized.  The present value ofestimated future net cash flows is computed by applying 12-month average priceof oil and natural gas to estimated future production of proved oil and gas reservesas of period-end, less estimated future expenditures to be incurred indeveloping and producing the proved reserves and assuming continuation ofexisting economic conditions.  Suchpresent value of proved reserves’ future net cash flows excludes future cashoutflows associated with settling asset retirement obligations that have beenaccrued on the Balance Sheet.  Should this comparison indicate anexcess carrying value, the excess is charged to earnings as an impairmentexpense.  As of April 4, 2010, we had not realized any impairment of ourproperties.

 

*JointVentures*

 

The financial statementsas of April 4, 2010 and March 29, 2009 include our accounts and ourproportionate share of the assets, liabilities, and results of operations ofthe joint ventures in which we are involved.

 

**Resultsof Operations**

 

BecauseVoyager had nooperations during the first quarter of 2010 as a result of the Peerless Mediatransaction, there is no discussion of the Voyager’s results ofoperations.  A discussion of the Voyager’s cash position resultingfrom its then existing royalty rights and other factors is discussed in theLiquidity and Capital Resources section below.

 

**Liquidityand Capital Resources**

 

***Cash and Cash Equivalents***

 

The Company’s total cashresources, excluding short-term investments, as of April 4, 2010 were $18,210,compared to $16,775 as of January 3, 2010. The increase in cash balance isprimarily attributable to the sale of available for sale securities.

 

*Three Months Ended April 4, 2010 Compared to Three Months Ended March 29,2009*

 

***Net Cash Provided by (Used In) Operating Activities***

 

Net cash provided by (usedin) operating activities was $(465) for the three months ended April 4, 2010and $154 for the three months ended March 29, 2009.  The net cash used in operating activitiesmakes up a portion of the net loss of the Companyduring the quarter.

 

***Net Cash Used In Investment Activities***

 

Net cash provided by (usedin) investment activities was $8,257 for the three months ended April 4, 2010and $(59) for the three months ended March 29, 2009.  Cash provided by investment activities isprimarily attributable to the sale of available for sale debt securities.

 

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***Net Cash Provided by FinancingActivities***

 

Net cash provided by (usedin) financing activities was $(102) for the three months ended April 4,2010 and $2,652 for the three months ended March 29, 2009.  Net cash used in financing activities wasprimarily attributable to repayments under the operating line of credit.

 

***Adequacy of Capital Resources***

 

With the addition ofequity capital achieved through the Merger, we believe we have sufficientcapital to meet our drilling commitments and expected general andadministrative expenses for the next twelve months, at aminimum.  Nonetheless, any strategic acquisition of assets mayrequire us to access the capital markets at some point in 2010.  Wemay also choose to access the equity capital markets to fund accelerated orcontinued drilling at the discretion of management and depending on prevailingmarket conditions.  We will evaluate any potential opportunities foracquisitions as they arise.  Given our non-leveraged asset base andanticipated growing cash flows, we believe we are in a position to takeadvantage of any appropriately priced sales that may occur.  However,there can be no assurance that any additional capital will be available to uson favorable terms or at all.

 

**Off-Balance Sheet Arrangements**

 

The Company has nooff-balance sheet arrangements that are reasonably likely to have a current orfuture material effect on our financial condition or changes in financialcondition.

 

**Recent Accounting Pronouncements**

 

In February 2010,the FASB issued ASU 2010-09, “Subsequent Events (Topic 855) - Amendments toCertain Recognition and Disclosure Requirements.” ASU 2010-09 requires anentity that is an SEC filer to evaluate subsequent events through the date thatthe financial statements are issued and removes the requirement that an SECfiler disclose the date through which subsequent events have been evaluated.ASC 2010-09 was effective upon issuance. The adoption of this standard had noeffect on the Company’s results of operations or financial position.

 

In April 2010, theFASB issued ASU 2010-13, “Compensation - Stock Compensation (Topic 718) -Effect of Denominating the Exercise Price of a Share-Based Payment Award in theCurrency of the Market in Which the Underlying Equity Security Trades.” ASU2010-13 provides amendments to Topic 718 to clarify that an employeeshare-based payment award with an exercise price denominated in the currency ofa market in which a substantial portion of the entity’s equity securitiestrades should not be considered to contain a condition that is not a market,performance, or service condition. Therefore, an entity would not classify suchan award as a liability if it otherwise qualifies as equity. The amendments inASU 2010-13 are effective for fiscal years, and interim periods within thosefiscal years, beginning on or after December 15, 2010. The adoption ofthis standard will not have an effect on the Company’s results of operations orfinancial position.

 

From time to time, newaccounting pronouncements are issued by FASB that are adopted by the Company asof the specified effective date.  If not discussed, managementbelieves that the impact of recently issued standards, which are not yeteffective, will not have a material impact on the Company’s financialstatements upon adoption.

 

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKETRISK**

 

Our financial instrumentsinclude cash and cash equivalents, short-term municipal bonds, corporatepreferred securities, certificates of deposit and ARS, including related putrights. Our main investment objectives are the preservation of investmentcapital and the maximization of after-tax returns on our investment portfolio.Consequently, we invest with only high-credit-quality issuers and limit theamount of credit exposure to any one issuer. We do not use derivativeinstruments for speculative or investment purposes.

 

Our cash equivalents andrestricted cash are not subject to significant interest rate risk due to theshort maturities of these instruments. As of April 4, 2010, the carryingvalue of our cash equivalents and restricted cash approximated fair value. Wehave in the past and our investment strategy for the future is to obtain marketabledebt securities (principally consisting of government securities, municipalbonds, corporate preferred securities and certificates of deposit) having aweighted average duration of one year or less. Consequently, such securitieswould not be subject to significant interest rate risk.

 

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**ITEM 4. CONTROLS AND PROCEDURES**

 

**Underthe supervision and with the participation of our management, including ourChief Executive Officer and President, and Interim Chief Financial Officer, weconducted an evaluation of our disclosure controls and procedures, as such termis defined under Rules 13a-15(e) or 15d-15(e) promulgated underthe Exchange Act, as of the end of the period covered by this report. Based onthis evaluation, our management has concluded that our disclosure controls andprocedures are effective.**

** **

There have been nosignificant changes (including corrective actions with regard to significantdeficiencies of material weaknesses) in our internal controls or in otherfactors that could significantly affect these controls subsequent to the dateof the evaluation referenced above.

 

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**PART II — OTHER INFORMATION**

 

**ITEM 1. LEGAL PROCEEDINGS**

 

None.

 

**ITEM 1A. RISK FACTORS**

 

Please refer to the risk factors contained inItem 1A under the caption “Risk Factors” and elsewhere in the Company’sannual report on Form 10-K for the fiscal year ended January 3, 2010,as updated by the Company’s current report on Form 8-K as filed April 22,2010

 

**ITEM 2. UNREGISTERED SALES OFEQUITY SECURITIES AND USE OF PROCEEDS**

 

None.

 

**ITEM 3. DEFAULTS UPON SENIORSECURITIES**

 

None.

 

**ITEM 4.  (REMOVED AND RESERVED)**

 

**ITEM 5. OTHER MATTERS**

** **

None.

 

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**ITEM 6. EXHIBITS**

 
| 31.1   |   | Certification of Chief  Executive Officer pursuant to Securities Exchange Act  Rules 13a-15(e) and 15d-15(e) as adopted pursuant to  Section 302 of the Sarbanes-Oxley Act of 2002         |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                           |
| 31.2   |   | Certification of  Interim Chief Financial Officer pursuant to Securities Exchange Act  Rules 13a-15(e) and 15d-15(e) as adopted pursuant to  Section 302 of the Sarbanes-Oxley Act of 2002 |
|   |   |                                                                                                                                                                                                           |
| 32.1   |   | Certification of Chief  Executive Officer and Interim Chief Financial Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002             |

 

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**SIGNATURES**

 

Pursuant to therequirements of the Securities Exchange Act of 1934, the registrant has dulycaused this report on Form 10-Q to be signed on its behalf by theundersigned, thereunto duly authorized.

 
| Dated: May 19,  2010 | VOYAGER OIL &  GAS, INC. |
|---------------------------|-----------------------------------|
|                      | Registrant                        |
|                      |                              |
|                      |                              |
|                      | /s/ *James Russell (J.R.) Reger*  |
|                      | James Russell (J.R.)  Reger       |
|                      | Chief Executive Officer           |
|                      |                              |
|                      |                              |
|                      | /s/ *Mitchell R. Thompson*        |
|                      | Mitchell R. Thompson              |
|                      | Interim Chief Financial  Officer  |

 

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