SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 and 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 18, 1996
U.S. ENERGY CORP.
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(Exact Name of Registrant as Specified in its Charter)
Wyoming 0-6814 83-0205516
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(State or other (Commission (I.R.S. Employer
jurisdiction of File No.) Identification No.)
incorporation)
Glen L. Larsen Building
877 North 8th West
Riverton, WY 82501
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (307) 856-9271
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Not Applicable
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(Former Name, Former Address or Former Fiscal Year,
if Changed From Last Report)
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Item 5. - Other Events
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On April 18, 1996 the arbitration panel (the "Panel")
entered an Arbitration Order and Award (the "Order") in the Sheep
Mountain Partners Partnership ("SMP") proceedings involving U.S.
Energy Corp. (the "Registrant"), its affiliate Crested Corp.
("Crested"), Nukem, Inc. and its wholly-owned subsidiary Cycle
Resource Investment Corporation (Nukem/CRIC). The Panel found in
favor of the Registrant and Crested on certain claims made by the
Registrant and Crested (including the claims for reimbursement of
standby, maintenance expenses and other expenses on the SMP
mines), and in favor of Nukem/CRIC and against the Registrant and
Crested on certain other claims.
The Registrant and Crested were awarded monetary damages of
approximately $7.4 million, which amount is after deduction of
monetary damages which the panel awarded in favor of Nukem/CRIC
and against the Registrant and Crested. An additional amount of
approximately $4.8 million was awarded by the Panel to the
Registrant and Crested, to be paid out of cash funds held in SMP
bank accounts, which accounts have been accruing operating funds
from SMP since the arbitration/litigation proceedings were
commenced. It is anticipated that such payment out of the SMP
bank accounts will be made in May 1996.
The Panel ordered that one utility supply contract for
980,000 pounds of uranium oxide held by Nukem/CRIC belonged to
SMP, and ordered such contract assigned to SMP. The contract
expires in 2000.
The fraud and RICO claims of the Registrant and Crested
against Nukem and CRIC were dismissed.
The timing of payment by Nukem/CRIC to the Registrant and
Crested of the $7.4 million monetary damages is presently
uncertain. The Registrant and Crested intend to seek a judicial
order that such amounts be paid out of the SMP additional funds
being held in the bank accounts.
The Panel did not order SMP dissolved. The Registrant and
Crested may seek to reach an agreement with Nukem/CRIC on
dissolution of SMP. If a dissolution is not achievable through
negotiation, the Registrant and Crested may seek judicial
intervention and the appointment of a receiver by the courts, to
wind up the partnership affairs and distribute assets after
payment of liabilities. The timing and ultimate resolution of
the partnership dissolution matter presently is uncertain.
Pending such resolution, the Registrant and Crested are hopeful
that delivery obligations under the various SMP utility supply
contracts can be met through the cooperation of Nukem/CRIC.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
U. S. ENERGY CORP.
May 9, 1996 By: s/ Max T. Evans
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MAX T. EVANS, Secretary
