UNITED STATES
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 September 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 0-23530
TRANS ENERGY, INC.
(Exact name of small business issuer as specified in its charter)
Nevada 93-0997412
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
210 Second Street, P.O. Box 393, St. Marys, West Virginia 26170
(Address of principal executive offices)
Registrant's telephone no., including area code: (304) 684-7053
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the past 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
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date.
Class Outstanding as of September 30, 1999
Common Stock, $.001 par value 3,685,459
TABLE OF CONTENTS
Heading Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements . . . . . . . . . . . . . . . . . . 3
Consolidated Balance Sheets -- September 30,
1999 and December 31, 1998 . . . . . . . . . . . . . . 4
Consolidated Statements of Operations --
three and nine months ended September 30,
1999 and 1998. . . . . . . . . . . . . . . . . . . . . 6
Consolidated Statements of Stockholders'
Equity (Deficit) . . . . . . . . . . . . . . . . . . . 7
Consolidated Statements of Cash Flows --
three and nine months ended September 30,
1999 and 1998. . . . . . . . . . . . . . . . . . . . . 8
Notes to Consolidated Financial Statements . . . . . . . 10
Item 2. Management's Discussion and Analysis and
Results of Operations. . . . . . . . . . . . . . . . . . 11
PART II. OTHER INFORMATION
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . 14
Item 2. Changes In Securities and Use of Proceeds. . . . . . . . 15
Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . 16
Item 4. Submission of Matters to a Vote of
Securities Holders . . . . . . . . . . . . . . . . . . . 16
Item 5. Other Information. . . . . . . . . . . . . . . . . . . . 16
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . 16
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . 17
PART I
Item 1. Financial Statements
The following unaudited Consolidated Financial Statements for
the period ended September 30, 1999 and December 31, 1998, have
been prepared by the Company.
TRANS ENERGY, INC.
CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1999 and December 31, 1998
TRANS ENERGY, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
ASSETS
September 30, December 31,
1999 1998
(Unaudited)
CURRENT ASSETS
Cash $ - $ -
Accounts receivable 251,958 249,528
Prepaid closing costs - 675,443
Prepaid advertising 265,914 485,063
Other current assets 1,508 1,508
Total Current Assets 519,380 1,411,542
PROPERTY AND EQUIPMENT
Vehicles 84,075 94,589
Machinery and equipment 10,092 10,092
Pipelines 2,254,908 2,254,908
Well equipment - 253,429
Wells 4,758,664 7,337,682
Leasehold acreage 541,625 541,625
Accumulated depreciation (1,918,883) (1,777,079)
Total Fixed Assets 5,730,481 8,715,246
OTHER ASSETS
Restricted cash - escrow account 327,610 -
Prepaid advertising - 202,110
Related party receivables - 21,231
Loan acquisition costs 3,509 3,509
Total Other Assets 331,119 226,850
TOTAL ASSETS $ 6,580,980 $ 10,353,638
TRANS ENERGY, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
September 30, December 31,
1999 1998
(Unaudited)
CURRENT LIABILITIES
Cash overdraft $ 76,205 $ 5,013
Accounts payable - trade 1,212,307 1,029,461
Accrued expenses 657,522 566,469
Salaries payable 285,798 225,798
Notes payable 1,028,055 990,427
Debentures payable 5,936,052 5,781,918
Total Current Liabilities 9,195,939 8,599,086
NET LIABILITIES IN EXCESS OF THE ASSETS OF
DISCONTINUED OPERATIONS 104,911 104,911
LONG-TERM LIABILITIES
Notes payable 801,976 863,109
Total Long-Term Liabilities 801,976 863,109
Total Liabilities 10,102,826 9,567,106
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: 30,000,000 shares authorized at
$0.001 par value; 3,685,459 and 2,174,817 shares
issued and outstanding, respectively 3,684 2,174
Capital in excess of par value 14,891,689 14,373,809
Accumulated deficit (18,417,219) (13,589,451)
Total Stockholders' Equity (Deficit) (3,521,846) 786,532
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT) $ 6,580,980 $ 10,353,638
TRANS ENERGY, INC.
Consolidated Statements of Operations
(Unaudited)
For the Nine Months For the Three Months
Ended September 30, Ended September 30,
1999 1998 1999 1998
REVENUES
Oil and gas sales $ 809,176 $ 849,419 $ 247,249 $ 376,413
Total Revenues 809,176 849,419 247,249 376,413
COSTS AND EXPENSES
Cost of oil and gas 688,860 648,657 353,854 345,581
Salaries and wages 65,508 80,370 19,094 21,774
Depreciation and amortization 1,200,415 714,947 164,780 633,686
Selling, general and
administrative 428,960 542,502 72,255 130,405
Total Costs and Expenses 2,383,743 1,986,476 609,983 1,131,446
Net Income (Loss) from
Operations (1,574,567) (1,137,057) (362,734) (755,033)
OTHER INCOME (EXPENSE)
Loss on valuation of assets (2,442,961) - - -
Gain on sale of assets - 239,129 - -
Interest income - 466 - 7
Interest expense (810,240) (2,379,822) (275,476) (852,428)
Total Other Income (Expense) (3,253,201) (2,140,227) (275,476) (852,421)
LOSS BEFORE INCOME TAXES
AND MINORITY INTERESTS (4,827,768) (3,277,284) (638,210) (1,607,454)
INCOME TAXES - - - -
MINORITY INTERESTS - - - -
NET LOSS $(4,827,768) $(3,277,284) $(638,210) $(1,607,454)
BASIC LOSS PER SHARE $ (1.65) $ (2.01) $ (0.87) $ (0.79)
FULLY DILUTED LOSS PER SHARE $ (1.65) $ (2.01) $ (0.87) $ (0.79)
TRANS ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Stockholders' Equity (Deficit)
Capital in
Common Shares Excess of Accumulated
Shares Amount Par Value Deficit
Balance, December 31, 1997 1,415,808 $ 1,415 $10,751,227 $ (8,740,161)
Contribution of capital by
shareholders - - 208,210 -
Common stock issued for services
at $1.45 per share 248,812 249 360,501 -
Common stock issued for debt
conversion at $1.65 per share 36,364 36 59,964 -
Common stock issued for prepaid
closing fees at $3.27 per share 473,833 474 1,548,427 -
Contributed capital from discount on
debentures - - 1,445,480 -
Net loss for the year ended
December 31, 1998 - - - (4,849,290)
Balance, December 31, 1998 2,174,817 2,174 14,373,809 (13,589,451)
Common stock issued for services
at $1.00 per share (unaudited) 200,000 200 199,800 -
Common stock issued for debt
conversion at $0.75 per share
(unaudited) 90,000 90 67,410 -
common stock issued for conversion
of debentures at $0.39 per share
(unaudited) 174,264 174 67,326 -
Common stock issued for services at
$0.25 per share (unrelated) 244,000 244 60,756 -
Common stock issued for conversion
of debentures at $0.15 per share
(unaudited) 796,448 796 121,704 -
Common stock issued for debenture
penalty and interest at $0.15 per
share (unaudited) 5,930 6 884 -
Net loss for the nine months
ended September 30, 1999 (unaudited) - - - (4,827,768)
Balance, September 30, 1999
(unaudited) 3,685,459 $3,684 $14,891,689 $(18,417,219)
TRANS ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
For the Nine Months For the Three Months
Ended September 30, Ended September 30,
1999 1998 1999 1998
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(4,827,768) $(3,277,284) $(638,210) $(1,607,454)
Adjustments to reconcile net
loss to cash provided
by operating activities:
Depreciation, depletion and
amortization 1,238,506 714,947 202,871 633,686
Common stock issued
for services 261,000 1,548,500 61,000 -
Amortization of debenture
discount - 1,415,372 - 27,752
Loss on valuation of assets 2,442,961 - - -
Changes in operating assets
and liabilities:
Decrease (increase) in
accounts receivable (2,181) 10,972 3,229 499
Decrease (increase) in
prepaid expenses - (1,061,695) - -
Decrease (increase) in loan
acquisition costs - (2,702,165) - -
Increase (decrease) in
accounts payable and accrued
expenses 86,108 1,121,081 42,427 713,856
Increase (decrease) in
interest payable 425,206 - 154,789 -
Cash Provided (Used) by
Operating Activities (376,168) (2,230,272) (173,894) (231,661)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property 400,000 259,129 400,000 -
Expenditures for property and
equipment (327) (3,461,818) - -
Cash Provided (Used) by
Investing Activities 399,673 (3,202,689) 400,000 -
CASH FLOWS FROM FINANCING ACTIVITIES:
Common stock issued for cash - 310,750 - -
Proceeds from debentures - 4,625,400 - -
Borrowings of long-term debt 245,090 918,610 - 659,402
Repayment to related parties - - - -
Principal payments on
long-term debt (268,595) (607,680) (226,106) (427,741)
Cash Provided (Used) by
Financing Activities (23,505) 5,247,080 (226,106) 231,661
NET INCREASE (DECREASE) IN CASH - (185,881) - -
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD - 185,881 - -
CASH AND CASH EQUIVALENTS,
END OF PERIOD $ - $ - $ - $ -
TRANS ENERGY, INC.
Consolidated Statements of Cash Flows (Continued)
(Unaudited)
For the Nine Months For the Three Months
Ended September 30, Ended September 30,
1999 1998 1999 1998
CASH PAID FOR:
Interest $ 76,897 $ 214,223 $ 11,912 $ 74,449
Income taxes $ - $ - $ - $ -
NON-CASH FINANCING ACTIVITIES:
Common stock issued for services $261,000 $1,548,500 $ 61,000 $ -
Conversion of debt to equity $258,390 $ - $123,350 $ -
Common stock issued for well costs $ - $ 50,000 $ - $ -
<PAGE>
TRANS ENERGY, INC. AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
September 30, 1999 and December 31, 1998
NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have
been prepared by the Company without audit. In the opinion
of management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the
financial position, results of operations and cash flows at
September 30, 1999 and for all periods presented have been
made.
Certain information and footnote disclosures normally
included in consolidated financial statements prepared in
accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these
condensed consolidated financial statements be read in
conjunction with the financial statements and notes thereto
included in the Company's December 31, 1998 audited
consolidated financial statements. The results of
operations for the periods ended September 30, 1999 and
1998 are not necessarily indicative of the operating
results for the full years.
NOTE 2 - LOSS ON VALUATION OF ASSETS
On July 2, 1999, the Company sold assets with a depreciated
basis of $2,842,961 for $400,000. The loss on valuation of
assets of $2,442,961 has been recorded to reflect the value
of these assets per the sales transaction.
NOTE 3 - GOING CONCERN
The Company's consolidated financial statements are
prepared using generally accepted accounting principles
applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the
normal course of business. The Company has incurred
cumulative operating losses through September 30, 1999, and
has a working capital deficit at September 30, 1999.
Revenues have not been sufficient to cover its operating
costs and to allow it to continue as a going concern. The
potential proceeds from the sale of common stock, other
contemplated debt and equity financing, and increases in
operating revenues from new development would enable the
Company to continue as a going concern. There can be no
assurance that the Company can or will be able to complete
any debt or equity financing. If these are not successful,
management is committed to meeting the operational cash
flow needs of the Company.
Item 2. Management's Discussion and Analysis or Plan
of Operations
The following table sets forth the percentage relationship to
total revenues of principal items contained in the Company's
Consolidated Statements of Operations for the three and nine month
periods ended September 30, 1999 and 1998. It should be noted that
percentages discussed throughout this analysis are stated on an
approximate basis.
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
(Unaudited) (Unaudited)
Total revenues . . . . . . . . . . 100% 100% 100% 100%
Total costs and expenses . . . . . 247 301 295 234
Net loss from operations . . . . . (147) (210) (195) (134)
Other income (expense) . . . . . . (111) (227) (402) (252)
Net income (loss). . . . . . . . . (258) (427) (597) (386)
Total revenues for the three months ("third quarter") and nine
months ("first nine months") ended September 30, 1999 decreased 34%
and 5%, respectively, when compared with the three and nine months
ended September 30, 1998. This decrease is primarily attributed to
the sale of certain wells. Total costs and expenses as a
percentage of total revenues decreased from 301% in the third
quarter of 1998 to 247% for the third quarter of 1999, and actual
costs and expenses decreased 64% during the same period. This
decrease is primarily attributed to the 74% decrease in
depreciation and amortization for the period due to prepaid closing
costs being fully amortized and prepaid advertising being mostly
exhausted, and 45% decrease in selling, general and administrative
expenses due to more efficient expense control related to increased
production. The decrease was partially offset by the 2% decrease
in the cost of oil and gas due to the stable nature of the
Company's marketing arrangements and reallocation of certain costs,
As a percentage of total revenues, total costs and expenses
increased from 234% in the first nine months of 1998 to 295% for
the first nine months of 1999. Actual costs and expenses
increased 20% in the first nine months of 1999, primarily
attributed to the 68% increase in depreciation and amortization
expenses due to the acquisition of the Gulf Canada properties in
Wyoming, and the 6% increase in cost of oil and gas due to changing
market prices due to existing contracts. These results were
partially offset by the 18% decrease in salaries and wages due to
a reduced staff, and 21% decrease in selling, general and
administrative expenses.
The Company's net loss for the third quarter and first nine
months of 1999 was $638,210 and $4,827,768, respectively, compared
to a net loss of $1,607,454 and $3,277,284 for the 1998 periods.
The decrease in net loss for the third quarter is attributed to the
reduction in operating expenses and interest expense during the
period. This increase in the Company's net loss for the first
nine months of 1999 compared to 1998 is attributed primarily to the
Company's loss of $2,442,961 on the sale of assets and the increase
in depreciation and amortization.
For the remainder of fiscal year 1999, management expects
selling, general and administrative expenses to remain at
approximately the same rate as for the first nine months of 1999.
The cost of oil and gas produced is expected to fluctuate with the
amount produced and with prices of oil and gas, and management
anticipates that revenues are likely to increase during the
remainder of 1999.
Net Operating Losses
The Company has accumulated approximately $12,320,000 of net
operating loss carryforwards as of December 31, 1998, which may be
offset against future taxable income through the year 2014 when the
carryforwards expire. The use of these losses to reduce future
income taxes will depend on the generation of sufficient taxable
income prior to the expiration of the net operating loss
carryforwards.
In the event of certain changes in control of the Company,
there will be an annual limitation on the amount of net operating
loss carryforwards which can be used. No tax benefit has been
reported in the financial statements for the year ended
December 31, 1998 or three month period ended September 30, 1999
because the potential tax benefits of the loss carryforward is
offset by valuation allowance of the same amount.
Liquidity and Capital Resources
Historically, the Company's working capital needs have been
satisfied through its operating revenues and from borrowed funds.
Working capital at September 30, 1999 was a negative $8,676,559
compared to a negative $7,187,544 at December 31, 1998. This 21%
decline in working capital is primarily attributed to the
realization of $975,443 in prepaid closing costs in 1998 compared
to none in the first nine months of 1999, and the 45% decrease in
prepaid advertising during the first nine months of 1999. Also
contributing to the decline in working capital was the 18% increase
in trade accounts payable, 16% increase in accrued expenses, 25%
increase in salaries payable, and 3% increase in debentures
payable.
The Company anticipates meeting its working capital needs
during the remainder of the current fiscal year with revenues from
operations, particularly from its Gulf Canada interests in Wyoming.
In the event revenues are not sufficient to meet the Company's
working capital needs, it will explore the possibility of
additional funding from either the sale of debt or equity
securities. The Company has no current agreements or arrangements
for additional funding and there can be no assurance such funding
will be available to the Company or, if available, it will be on
acceptable or favorable terms to the Company.
As of September 30, 1999, the Company had total assets of
$6,580,980 and total stockholders' deficit of $3,521,846, compared
to total assets of $10,353,638 and total stockholders' equity of
$786,532 at December 31, 1998. This decrease in assets and
stockholders' equity is primarily attributed to the loss on
valuation of assets of $2,442,961.
At September 30, 1999, the Company had debentures payable of
$5,936,052, which represents certain convertible debentures that
matured during the first quarter of 1999. The Company currently
anticipates that either the debentures will be converted into
common stock or the Company will attempt to negotiate an extension
to the maturity date.
On July 2, 1999, the Company sold assets with a depreciated
basis of $2,842,961 for $400,000. The loss on valuation of assets
of $2,442,961 has been recorded to reflect the value of these
assets per the sales transaction. The Company has applied the
proceeds from the sale to general operating expenses.
Inflation
In the opinion of management, inflation has not had a material
effect on the operations of the Company.
Year 2000
Year 2000 issues may arise if computer programs have been
written using two digits (rather than four) to define the
applicable year. In such case, programs that have time-sensitive
logic may recognize a date using "00" as the year 1900 rather than
the year 2000, which could result in miscalculations or system
failures.
The Company has completed its assessment of the Year 2000
issue and believes that any costs of addressing the issue will not
have a material adverse impact on the Company's financial position.
The Company believes that its existing accounting computer systems
and software will not need to be upgraded to mitigate the Year 2000
issues. The Company has not incurred any costs associated with its
assessment of the Year 2000 problem. In the event that Year 2000
issues impact the Company's accounting operations and other
operations aided by its computer system, the Company believes, as
part of a contingency plan, that it has adequate personnel to
perform those functions manually until such time that any Year 2000
issues are resolved.
The Company believes that third parties with whom it has
material relationships will not materially be affected by the Year
2000 issues as those third parties are relatively small entities
which do not rely heavily on information technology ("IT") systems
and non-IT systems for their operations. However, if the Company
and third parties upon which it relies are unable to address any
Year 2000 issues in a timely manner, it could result in a material
financial risk to the Company, including loss of revenue and
substantial unanticipated costs. Accordingly, the Company plans to
devote all resources required to resolve any significant Year 2000
issues in a timely manner.
Risk Factors and Cautionary Statements
Forward-looking statements in this report are made pursuant to
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. The Company wishes to advise readers that
actual results may differ substantially from such forward-looking
statements. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those expressed in or implied by the statements, including,
but not limited to, the following: the ability of the Company to
secure additional financing, the possibility of success in the
Company's drilling endeavors, competitive factors, and other risks
detailed in the Company's periodic report filings with the
Securities and Exchange Commission.
PART II
Item 1. Legal Proceedings
There are no material pending legal proceedings to which the
Company is a party or to which any of its property is subject
except as set forth below.
On May 14, 1997, a complaint entitled R&K Oil Company, Inc.
vs. Vulcan Energy Corporation and Trans Energy, Inc. was filed in
District Court, Andrews County, Texas, 109th Judicial District
(File #14,430). The complaint alleges the Company owes R&K Oil
Company, Inc. $126,978 as a result of business transacted by Vulcan
Energy Corporation. The complaint also seeks $500,000 for breach
of contract. The Company settled the suit for $15,000 in December
1998.
On March 12, 1997, a complaint entitled F. Worthy Walker vs.
Loren Bagley, William Woodburn, Mark Woodburn, Trans Energy, Inc.
and Vulcan Energy Corporation, was filed in the District Court of
Dallas, Texas (# 9702304C). The complaint alleges that the Company
breached certain contracts related to Mr. Walker's employment with
Vulcan Energy Corporation, and seeks punitive and exemplary
damages. The Company denies all allegations and intends to
vigorously defend its position. Management believes that the
results of the proceedings will not have a material adverse effect
on the Company. On February 17, 1998, the Company and the above
named defendants filed a countersuit against F. Worthy Walker
alleging breach of contract, fraud and fraudulent inducement,
conversion, and breach of fiduciary duty and seeks punitive
damages. The Company intends to vigorously pursue its countersuit
against Mr. Walker.
The Company is also defending a lawsuit filed in 1998 in the
189th Judicial District Court of Harris County, Texas entitled
Baker Hughes Oilfield Operation, Inc. d/b/a Baker Hughes Inteq. vs.
Loren E. Bagley, Individually and Doing Business as Trans Energy,
Inc. (#98-48248). This action is premised on an alleged breach of
contract and fraud and seeks to recover monetary damages in the
amount of $41,142, plus attorneys' fees, exemplary damages, costs
and interest. The Company denies all allegations and intends to
vigorously defend its position. Presently, the action is in the
early discovery phase.
Also in 1998 an action was filed against the Company in the
234th Judicial District Court of Harris County, Texas entitled
Western Geophysical, a Division of Western Atlas international,
Inc. vs. Trans Energy, Inc. and Loren F. Bagley, Individually and
Doing Business as Trans Energy, Inc. (#98-58146). In this action
the plaintiff alleges breach of contract and fraud and seeds to
recover monetary damages of $435,714, plus attorney's fees,
exemplary damages, costs of the suit and interest. The Company is
presently attempting to negotiate a settlement in the matter.
A foreign judgment has been filed with the circuit court in
Pleasants County, West Virginia for a judgment rendered by the
District Court in Harris County, Texas. The judgment is for
$41,142 plus prejudgment interest and attorney's fees of $13,500.
No action has been taken to collect on this judgment.
Item 2. Changes In Securities and Use of Proceeds
During the third quarter of 1999, the Company issued a total
of 1,046,378 shares of its common stock. Of this amount 244,000
shares of common stock to six persons for services rendered to the
Company valued at $.25 per share, and 802,378 shares to eight
persons upon the conversion of certain debentures valued at $.15
per share, including penalty and interest.
The above issuances of shares were made in private
transactions to persons possessing knowledge of the Company and
its business operations. Accordingly, the Company relied upon the
exemption from registration under the Securities Act of 1933, as
amended, provided by Sections 3(a)(9) and 4(2) of such Act.
Item 3. Defaults Upon Senior Securities
In 1998, the Company issued $4,625,400 face value of 8%
Secured Convertible Debentures due March 31, 1999 (the
"Debentures") Interest is to accrue upon the date of issuance
until payment in full of the principal sum has been made or duly
provided for. Holders of the Debentures shall have the option, at
any time, until maturity, to convert the principal amount of their
Debenture, or any portion of the principal amount which is at least
$10,000 into shares of the Company's Common Stock at a conversion
price for each share equal to the lower of (a) seventy percent
(70%) of the market price of the Company's Common Stock averaged
over the five trading days prior to the date of conversion, or (b)
the market price on the issuance date of the Debentures. Any
accrued and unpaid interest shall be payable, at the option of the
Company, in cash or in shares of the Company's Common Stock valued
at the then effective conversion price.
The Company has not repaid the Debentures and has not
finalized a registration statement under which the Debentures can
be converted into common stock. The Company is attempting to
renegotiate the terms of the debenture or to extend their terms.
Item 4. Submission of Matters to a Vote of Security Holders
This Item is not applicable to the Company.
Item 5. Other Information
This Item is not applicable
Item 6. Exhibits and Reports on Form 8-K
(b) Reports on Form 8-K
During the three month period ended September 30, 1999, the
Company did not file any reports on Form 8-K.
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the Registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
TRANS ENERGY, INC.
Date: November 22, 1999 By /S/ Loren E. Bagley
LOREN E. BAGLEY, President
and Chief Executive Officer
Date: November 22, 1999 By /S/ William F. Woodburn
WILLIAM F. WOODBURN, Vice
President and Director
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE TRANS ENERGY, INC. FINANCIAL
STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 1999
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 251,958
<ALLOWANCES> 0
<INVENTORY> 0
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0
0
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</TABLE>
