U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 0-9336
STANDARD ENERGY CORPORATION
(Name of Small Business Issuer as specified in its charter)
Utah 87-0338149
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
363 Bearcat Drive
Salt Lake City, Utah 84115-2517
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (801) 364-9000
Securities registered pursuant to Section 12(b) of the Exchange Act:
None
Securities registered pursuant to Section 12(g) of the Exchange Act:
$.01 Par Value Common Stock
Check whether the Issuer (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1933, as amended
(the "Act") during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No .
Common Stock outstanding at August 12, 1998: 104,082,972 shares
of $0.01 par value Common Stock.
DOCUMENTS INCORPORATION BY REFERENCE: NONE
FORM 10-QSB
Financial Statements and Schedules
STANDARD ENERGY CORPORATION
For First Three Months Ended June 30, 1998
The following table of contents of financial statements and other
information of the registrant and its consolidated subsidiaries are
submitted herewith:
PART I - FINANCIAL INFORMATION
Item Page
Item 1. Condensed Consolidated Balance Sheets -
June 30, 1998 and March 31, 1998................... 3
Consolidated Statements of Operations -
For the three months
ended June 30, 1998................................ 5
Consolidated Statements of Cash Flows -
For the three months ended
ended June 30, 1998 and March 31, 1998............. 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations......... 7
Plan of Operation..................................... 10
Management's Conflicts of Interest.................... 13
Forward Looking Statements............................ 14
PART II - OTHER INFORMATION
Item 1. Legal Proceedings..................................... 15
Item 2. Changes in Securities................................. 15
Item 3. Defaults upon Senior Securities....................... 15
Item 4. Submission of Matters to a Vote of Security Holders... 15
Item 5. Other Information..................................... 15
Item 6. Exhibits.............................................. 15
PART I - ITEM 1
STANDARD ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
June 30 March 31
1998 1998
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS
Cash $ 5,649 $ 2,974
Accounts receivable 1,223 1,523
TOTAL CURRENT ASSETS 6,872 4,497
INVESTMENT IN OIL AND GAS PRODUCING
PROPERTIES, net of depletion of $92,970
PROPERTY AND EQUIPMENT, net 21,500 22,500
OIL AND GAS LEASEHOLD INTERESTS HELD
OTHER ASSETS
Oil and gas leases held for resale 71,653 71,653
Pledged drilling bonds 35,000 35,000
Cash value of life insurance 5,122 5,122
TOTAL OTHER ASSETS 111,775 111,775
TOTAL ASSETS $ 140,147 $ 138,772
See notes to consolidated financial statements
STANDARD ENERGY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30 March 31
1998 1998
(Unaudited) (Audited)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 17,828 $ 19,618
Notes payable to related parties 59,000 50,000
Accounts payable and accrued expenses 41,341 40,105
TOTAL CURRENT LIABILITIES 118,169 109,723
STOCKHOLDERS' EQUITY
Common Stock, par value $.01 per share:
Authorized 200,000,000 shares; issued
and outstanding 104,082,972 shares at
June 30, 1998 1,040,829 1,040,829
Preferred Stock, par value $.01 per share;
Authorized 10,000,000 shares 0 0
Additional paid-in capital 7,161,253 7,161,253
Retained earnings (deficit) (8,180,104) (8,173,033)
TOTAL STOCKHOLDERS EQUITY 21,978 29,049
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 140,147 $ 138,772
See notes to consolidated financial statements
STANDARD ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended June 30
1998 1997
REVENUES
Oil and gas information services $ 1,350 $ 3,574
Sales of oil and gas leasehold interests 14,719 0
Oil production 3,149 4,225
Other income 346 582
19,564 8,381
COSTS AND EXPENSES
Oil and gas information services 1,883 2,403
Oil and gas leasehold interests 1,804 7,071
Oil production 0 0
Depreciation, depletion and amortization 1,000 1,000
Interest 3,732 665
General and administrative 18,216 28,182
TOTAL COSTS AND EXPENSES 26,635 39,321
NET INCOME (LOSS) $ (7,071) $ (30,940)
NET INCOME (LOSS) $ (.00) $ (.00)
See notes to consolidated financial statements
STANDARD ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended June 30
1998 1997
Cash Flows From Operating Activities
Net income (loss) $ (7,071) $ (30,940)
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and depletion 1,000 1,000
Changes in:
Accounts receivable 300 0
Accounts payable 1,236 (773)
Net cash provided by (used in)
operating activities (4,535) (30,713)
Cash Flow From Industry Activities
(Increase) Decrease to Long-term investments $ 0 $ 0
(Increase) Decrease oil & gas leasehold
interests 0 0
Net cash provided by (used in)
investing activities $ 0 $ 0
Cash Flows From Financing Activities
Increase (decrease) in notes payable $ 7,210 $ 31,884
Proceeds from sale of common stock 0 0
Net cash provided by (used in)
Financing activities $ 7,210 $ 31,884
Net Increase (Decrease) in Cash $ 2,675 $ 1,171
Cash at Beginning of Period 2,974 2,533
Cash at End of Period $ 5,649 $ 3,704
See notes to consolidated financial statements.
PART I - ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The Company's primary oil and gas business, the brokerage of
leasehold interests, has not materially increased during the period
ended June 30, 1998, due to decreased activity in the domestic oil and
gas exploration industry. In light of this decreased activity, and the
Company's lack of capital, it has been exploring other ways of
generating revenues.
During the current fiscal period, the Company continues to
research and develop its technologies for the recycle of municipal
solid waste ("MSW") into (1) valuable recycled metals, glass,
plastics, etc., products that are saleable in the existing commercial
salvage markets and (2) the recovery of MSW derived cellulosic
material ("Celmat") convertible into fuel-grade ethanol and lignin
("Lignin"), a coal-like aromatic substance believed to be a usable
boiler fuel and/or a specialty chemical useable in the petro-chemical
industry (collectively the "Biofuels Technology"). Expenses incurred
for the South Bend Project are currently being accounted for under
line item general and administrative expense.
As a result of the Company's research and development efforts,
management believes that the Company has developed what appears to be
a commercial application of the Biofuels Technology for its future
project (the "South Bend Project"). Project details are described in
the Company's confidential South Bend Project Business Plan prepared
by engineering firms W.J. Scales & Company of Denver, Colorado and
Limbach Company of Richmond, Virginia (collectively the "Scales
Group"). The Business Plan is based on the Scales Group present
technical engineering designs and experience in the development of
large new commercial projects. The Business Plan includes a plan to
finance and develop the South Bend Project utilizing the Biofuels
Technology. (See "Research and Development - South Bend Project"
below)
There can be no assurance that the required capital will be
available and there can be no assurance that the Biofuels Technology
will perform on a commercial basis. The Company's future operating
results will depend on its ability to obtain adequate financing to
construct the South Bend Project. Expenses incurred for the South Bend
Project are currently being accounted for under line item "general and
administrative" expense.
Results of Operations
The Company realized revenues of approximately $20,000 for the
three-month period ended June 30, 1998, compared with approximately
$8,000 for the corresponding 1998 period. Cash requirements during the
period were obtained from a combination of internally generated cash
flow from operations, asset sales, and the sale of investment stock to
private individuals.
Revenues from oil and gas leasehold sales for the three-month
period ended June 30, 1998 was approximately $15,000 compared to no
leasehold sales for the corresponding period ended June 30, 1997.
Revenues from the sale of the Company's geologic information services
were approximately $1,000 for the three-month period ended June 30,
1998, compared with approximately $3,000 for the corresponding 1998
period. Revenues from the Company's geologic information services have
declined steadily from the 1986, 1993 and 1998 collapse of world crude
oil prices.
Revenue from oil production was approximately $3,000 for the
period ended June 30, 1998, compared to approximately $4,000 for the
corresponding period ended June 30, 1997. Oil production revenues
continue to decline reflecting current low world crude oil prices.
During June 1998, oil prices collapsed to a 25-year low.
The Company incurred expenses related to the Company's oil and
gas leasehold sales of approximately $2,000 for the three-month period
ended June 30, 1998, compared to approximately $7,000 for the
comparable period ended June 30, 1997. Expenses associated with the
Company's geologic information services were approximately $2,000 for
the three-month period ended June 30, 1998, compared to approximately
$2,000 for the comparable period ended June 30, 1997. There were no
oil production and exploration costs during the periods ended June 30,
1998 and June 30, 1997 due to the Company's exploration inactivity.
General and administrative expense for the period ended June 30, 1998
were approximately $18,000, compared to approximately $28,000 for the
comparable period ended June 30, 1997.
The Company's net loss for the period ended June 30, 1998 was
approximately $7,000 compared to approximately $31,000 for comparable
period ended June 30, 1997. The Company anticipates that it will
continue to operate at a loss for the remainder of the 1999 fiscal
year, ended March 31, 1999, due to continued costs incurred for the
South Bend Project and costs related to its oil and gas business.
The Company does not expect to realize significant cash flows
from the sale of leasehold interests, geologic information services,
or oil production and exploration activities during the remainder of
fiscal 1999, nor does it expect significant leasehold sales in the
foreseeable future, as the domestic oil industry continues to shrink
from low worldwide crude oil prices.
The Company adopted Statement of Financial Accounting Standards
No. 109 "Accounting for Income Taxes" [FASB 109] during the year ended
March 31, 1994. FASB 109 requires the Company to provide a net
deferred tax asset or liability equal to the expected future tax
benefit or expense of temporary reporting differences between book and
tax accounting and any available operating loss or tax credit carry
forwards. At March 31, 1997 and 1996, the total of the deferred tax
assets were $1,837,459 and $1,800,064 the total of all deferred tax
liabilities were $0 and $(1,789). The amount of and ultimate
realization of the benefits from the deferred tax assets for income
tax purposes is dependent, in part, upon the tax laws in effect, the
Company's future earnings, and other future events, the effects of
which cannot be determined.
Because of the uncertainty surrounding the realization of the
deferred tax assets, the Company has established a valuation allowance
of $1,837,459 and $1,800,064 as of March 31, 1997 and 1996, which has
been offset against the deferred tax assets. The net change in the
valuation allowance during the year ended March 31, 1997 was $37,395.
The cumulative effect of the change in accounting for income taxes for
prior years was not material to the statement of income for the year
ended March 31, 1998. The financial statements for prior years have
not been restated.
The Company has available at March 31, 1998, unused tax operating
loss carry forward of approximately $4,477,000 that may be applied
against future taxable income through 2012. No tax benefit has been
reported in the financial statements, because the Company believes
there is 50% or greater chance the carry forwards will expire unused.
Accordingly, the potential tax benefits of the loss carry forwards are
offset by a valuation account of the same amount. (See "Consolidated
Financial Statements" above)
Financial Condition
Management is aggressively exploring additional financing for
ongoing and future operations of the Company and has entered into an
agreement with the Scales Group for the engineering, management, and
construction of the South Bend Project. There is no assurance that the
efforts of management or the Scales Group to locate and secure
additional financing will be successful, and the failure to secure
project financing would substantially alter management's assumptions
as herein presented.
Revenue reduction in the Company's overall oil and gas business
is related to effects of the 1986, 1993 and 1998 worldwide collapse of
crude oil price and the corresponding reduced oil and gas brokerage
activity of the Company. The reduced activity in its oil and gas
business, along with the Company's investment in Biomass
International, Inc. ("Biomass") without any intervening revenues, have
resulted in the Company incurring losses in its Biomass investment
aggregating approximately $4,100,000 from fiscal 1981 through fiscal
1993 ended March 31, 1992. Because of these circumstances the Company
is currently experiencing cash flow difficulties. In order to continue
in existence the Company is in need of additional financing from
outside sources or from internal operations. (See "Consolidated
Financial Statements" above)
Management can give no assurances that it will be successful in
its endeavors to resolve its cash flow difficulties or that it will be
able to retain and ultimately recover its costs in oil and gas
leaseholds held for resale. The financial statements do not include
any adjustments relating to the amounts and classification of assets,
liabilities, income or expenses that might be necessary should the
Company be unable to successfully resolve these uncertainties and
continue in existence.
For the period ended June 30, 1998, the Company had no additional
research and development expense in Biomass, nor does it expect to
make any further investments in Biomass in the future, nor does it
expect to recover its investment in Biomass. On December 19, 1997,
Mr. Rowell resigned as an officer and director of Biomass to more
fully pursue the Company's oil and gas business and its South Bend
Project development.
The Company's most significant assets are (1) its oil and gas
production income, (2) its oil and gas leaseholds held for resale,
approximating 60,000 net acres at June 30, 1998, including leaseholds
acquired under its unrelated third-party agreements, and (3) its plan
for the full development of the South Bend Project. Other assets are;
(4) the $4,477,000 tax loss carry forward, and (5) the 5,252,556
shares of Biomass common stock. At June 30, 1998, the Biomass shares
had little value being bid $0.005 and asked $0.01 on the electronic
OTC Bulletin Board. With little or no volume on a daily basis for the
past three years, Rule 144 sales of its Biomass shares appear
impractical for the Company in the foreseeable future.
The Company foresees a need for additional equity financing in
order to continue in existence, and may, in the future, seek to raise
additional funds through asset sales, bank and/or other loans, debt,
or equity offerings. Any such equity offerings, asset sales, or other
financing may either be private or public and may result in
substantial dilution to the then existing shareholders of the Company.
Plan of Operation
There have been no significant changes in capitalization or
financial status during the past two years that are not reflected in
the financial statements. The Company's plan of operation during the
next twelve (12) months includes the following:
1. Aggressively pursue oil and gas lease acquisition with
third party investors.
2. Aggressively pursue financing for the South Bend Project
with the Scales Group and other current financial contacts.
3. Continue research and development, testing MSW processing
equipment and testing existing and new cellulose enzymes.
4. Continue design and development of the South Bend Project.
5. Engage an investor relations person to disseminate
information about the Company, its technologies, and the
South Bend Project.
Research and Development - South Bend Project
The Company continues to research and develop its technologies
for the recycle of MSW into (1) valuable recycled metals, glass,
plastics, etc., products that are saleable in the existing commercial
salvage markets and (2) the recovery of MSW derived Celmat convertible
into fuel-grade ethanol and Lignin. These efforts have led management
to believe that the Company has developed what appears to be a
commercial application of the Biofuels Technology for its future South
Bend Project, based on the Scales Group present technical engineering
designs and experience in the development of large new commercial
projects.
In 1995, the Company initiated a search for a way to commercially
exploit the Biofuels Technology. New plant construction was ruled out
due to the prohibitively high costs, together with the five to eight
year time period required to locate a suitable site and construct a
grassroots manufacturing facility. Idled plants, or plants operating
uneconomically, were considered a more appropriate and viable
alternative, resulting in the development by the Company of the South
Bend Project.
To commercialize the Biofuels Technology, the Company requires a
large operating MSW incinerator plant and a large operating corn
ethanol plant. Waste to energy incineration plants (the "Recycle
Plant") are available for economic reasons, due to "flow control" that
was ruled illegal by the U.S. Supreme Court on November 10, 1997 for
the second time. Dry mill corn ethanol plants (the "Ethanol Plant")
are available at reasonable prices, due to thin operating margins. The
estimated cost to purchase the Recycle and Ethanol Plants is
$95,000,000 and the cost to retrofit them with new equipment is
$155,000,000 for a total estimated cost of $250,000,000.
The Company, the Scales Group, and others are presently
attempting to obtain a project loan with unrelated third parties to
raise up to $250,000,000 (the "Loan"). The Loan, if obtained, would be
used to finance the purchase, refit, and initial operations of both
the Ethanol Plant and Recycle Plant facilities as a single economic
unit in two locations. It is the Company's belief that combined, and
operated as one economic unit, the two plants have better overall
economic strengths than each plant would have if operated as separate
integrated MSW recycle/ethanol production plants. The principal reason
for such conclusion is that no immediate new building erection would
be required at either plant site. There can be no assurance that the
required Loan will be available and there can be no assurance that the
Biofuels Technology will perform on a commercial basis. The Company's
future operating results will depend on its ability to obtain adequate
financing to construct the South Bend Project.
The Company, providing it is successful in receiving the Loan,
for which there is no assurance, anticipates refitting the Recycle
Plant to operate only as a MSW sorting plant which could recycle
approximately 2200 tons/day of MSW into, principally, 900 tons/day of
metals, glass and other inorganic products, together with
approximately 1300 tons/day of Celmat. The inorganics would be sold,
or landfilled, in the Philadelphia/New York area. The organic Celmat
would be baled and shipped to the Ethanol Plant for processing into
ethanol and other products. The MSW would be supplied to the Recycle
Plant by present haulers of MSW located in the Eastern U.S.
The Company, providing it is successful in receiving the Loan,
would also refit the Ethanol Plant to eventually operate only on
Celmat and not corn to produce ethanol. It would process the baled
Celmat from the Recycle Plant through twelve module processing units
to be installed in or adjacent to existing buildings located on the
Ethanol Plant site. The Company lacks the financial resources to
purchase, lease, or otherwise acquire any economic interest in either
plant or plant site, but is seeking project financing through the
Scales Group and others. Although the Company believes the two plants
are available for purchase, the Company currently has no economic
interest in either plant or plant site.
At August 12, 1998, the South Bend Project, fundamentally, is
only an engineering concept where the Company is contemplating the
purchase of two separate but presently operating industrial plants,
for the purpose of retrofitting each plant with the Company's Biofuels
Technology, while present operations continue uninterrupted at each
plant site. The Company is pursuing the Loan and other financing ideas
through two wholly-owned subsidiaries, Standard EnviroSystems, Inc.
("EnviroSystems") and Biofuels, Inc. ("Biofuels"). Final plans and
final financial arrangements with unrelated third-parties for the Loan
on the South Bend Project had not been finalized or completed as of
August 12, 1998.
Inflation
Inflation continues to apply moderate upward pressure on the cost
of goods and services including those purchased by the Company.
Management believes the net effect of inflation on operations has been
minimal during the past two years.
Recent Accounting Pronouncements
There are no recent accounting pronouncements that will have a
material impact on the Company's financial statements.
Management's Conflicts of Interest
Material conflicts of interest exist and will continue to exist
between the Company and Trachyte Oil Company ("Trachyte"), and Dean W.
Rowell, who is also the President of Trachyte, a privately-held Utah
corporation, whose current major activities are the exploration and
production of oil and gas resources. The Company's policy is to offer
any new oil and gas property purchase first to the Company and then to
Trachyte if the Company is unable to accept the financial obligation
of any transaction. As of August 12, 1998, Mr. Rowell owns
beneficially approximately 50% of the common stock of the Company and
100% of the common stock of Trachyte.
Geologic and other information which PIC has or develops is
available to Mr. Rowell as an officer of the Company, and he may use
such information for the benefit of the Company in determining which
leases to buy or sell.Such information is also available to
Mr. Rowell, without cost, in connection with Mr. Rowell's
participation in the Leasing Programs.
On December 19, 1997, Mr. Rowell resigned as an officer and
director of Biomass, partially resolving any future conflict of
interest between the Company, Mr. Rowell, and Biomass. Although
Mr. Rowell is no longer affiliated with Biomass, the Company holds in
excess of 10% of the common stock of Biomass making the Company a
controlled person of Biomass under the 1993 Act. Certain conflicts of
interest may arise between the Company, Biomass, and Mr. Rowell,
depending on future development of the biomass technology by Biomass
and the future results from the development of the Company's Biofuels
Technology, to the extent both companies may be involved in the
ethanol production business.
During the fiscal period ended March 31, 1998, the Company
continued to experience severe cash flow difficulties which have
continued into the 1999 fiscal period. Since the Company has been
unable to repay any of the loans from Trachyte during the past two
fiscal periods, Trachyte has received a demand note from the Company
in the amount of $50,000 plus interest at 12% per annum. At August 12,
1998 the Company owed Trachyte approximately $52,000. Neither
Mr. Rowell nor Trachyte received any common stock in exchange for debt
forgiveness during the fiscal period ended March 31, 1998.
During the seven year period since fiscal 1991, Trachyte has
helped financially support the Company largely due to Mr. Rowell's
efforts to secure loans from Trachyte for the Company during periodic
cash flow difficulties. During such periods, the several transactions
with Trachyte have provided the financial means for the Company to
pursue commercialization of the South Bend Project, otherwise the
Company would have been unable to pursue this goal. Final plans and
final financial arrangements had not been completed for the South Bend
Project as of August 12, 1998.
Mr. Rowell owes a duty of due care and fair dealing to both the
Company and Trachyte and the resolution of duties and conflicts in
favor of one company over the other may impair his duties to each
company. It is likely that any conflict of interest between the
Company and Trachyte requiring a determination may have to be settled
in favor of the Company to the detriment of Trachyte, as well as to
the detriment of the current and future shareholders of Trachyte.
Forward Looking Statements
The forgoing discussion in "Management's Discussion and Analysis
of Financial Condition and Results of Operation" contain
forward-looking statements, within the meaning of Section 27A of the
Securities Act of 1933 ("1933 Act") and Section 21E of the Act, which
reflect Managements current views with respect to the future events
and financial performance. The Company cautions that words used in
this document such as "experts", "anticipates", "believes" and "may"
as well as similar words and expressions identify and refer to
statements describing events that may or may not occur in the future,
including among other things, statements relating to anticipated
growth and increased profitability, as well as to statements relating
to the Company's strategic plan, including plans to develop the South
Bend Project and to selectively acquire other companies. These
forward-looking statements and the matters to which they refer to are
subject to considerable risks and uncertainties that may cause actual
results to be materially different from those described in this
document, including, but not limited to future financial performance
and future events, competitive pricing for services, costs of
obtaining capital as well as national, regional and local economic
conditions. Actual results could differ materially from those
addressed in the forward-looking statements. Due to such uncertainties
and risks, readers are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date of this
Form 10-QSB report.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
In July 1997, Mr. Rowell was named in a lawsuit filed in the
United States District Court for the Southern District of New York.
The complaint alleges that Mr. Rowell violated Section 16(b) of the
Act in connection with several transactions involving shares of the
Company's common stock, principally a transaction in October 1996
between Mr. and Mrs. Rowell, where Mrs. Rowell agreed to transfer
5,000,000 shares of her common stock holdings to Mr. Rowell in payment
to Mrs. Rowell of $200,000. The complaint seeks damages from
Mr. Rowell in excess of $600,000. Because this is an action for an
alleged Section 16(b) violation of the Act, the damages are sought on
behalf of the Company, and as such, the interests of the Company and
Mr. Rowell are adverse.
In August 1998, Mr. Rowell, without admitting liability, settled
the complaint substantially upon the following terms to avoid further
legal expense: the payment by Mr. Rowell to the Company of $37,500 in
cash; the forgiveness of $29,247 of indebtedness owed by the Company
to Trachyte; and the return by Mr. Rowell of common shares of the
Company valued at $83,253, amounting to 1,037,420 shares. The
Company's board of directors have approved the settlement terms. The
Company is obligated under the settlement agreement to pay the lawyer
representing the plaintiff a fee of $16,607, including court costs,
which amount will be paid out of the cash portion of the settlement.
The settlement must be approved by the court and no assurance can be
given that this litigation will be resolved on the above described
terms.
Item 2. Changes in Securities. None.
Item 3. Defaults On Senior Securities. None.
Item 4. Submission of Matters to a Vote of Security Holders. None.
Item 5. Other Information. None.
Item 6. Exhibits and Reports on Form 8-K, filed during the
quarter ended June 30, 1998. None.
SIGNATURE
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 thereunto duly authorized.
STANDARD ENERGY CORPORATION
(Registrant)
By:
Dean W. Rowell, President and
Chief Financial Officer
Date: August 12, 1998
