body_standard10qmay312010.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(X )
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITES EXCHANGE ACT OF 1934
 
For the quarterly period ended                                                      May 31, 2010

( )
TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transaction period from                                                                 to
   
 
Commission File number                                                      0-24707 

STANDARD CAPITAL CORPORATION
(Exact name of registrant as specified in charter)

Delaware
91-1949078
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employee I.D. No.)

          557 M. Almeda Street
  
          Metro Manila, Philippines
  
       (Address of principal executive offices)
(Zip Code)

       Registrant's telephone number, including area code  011-632 724-5517 
  

Not Applicable
(Former name, former address and formal fiscal year, if changed since last report)

Indicate by check mark whether the registrant (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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See definition of “large accelerated filer”, “accelerated filer” and “small reporting company” Rule 12b-2 of the Exchange Act.

Large accelerated filer   [   ]                                                                                                           Accelerated filer                   [   ]
Non-accelerated filer     [   ]  (Do not check if a small reporting company)                            Small reporting company    [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)   Yes [  ]   No   [X]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PROCEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 after the distribution of securities subsequent to the distribution of securities under a plan confirmed by a court.  Yes □ No □

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

June 15, 2010: 2,285,000 common shares
 
 
 
 
-1-
 
 

   
Page Number
     
PART 1.
FINANCIAL INFORMATION
  
     
ITEM 1.
Financial Statements (unaudited)
3
     
 
Balance Sheets as at May 31, 2010 and August 31, 2009
4
     
 
Statement of Operations
For the three and nine months ended May 31, 2010 and 2009 and for the period September 24, 1998 (Date of Inception) to May 31, 2010
 
 
5
     
 
Statement of Cash Flows
For the nine months ended May 31, 2010 and 2009 and for the period September 24, 1998 (Date of  Inception) to May 31, 2010
 
6
     
 
Notes to the Financial Statements.
7
     
ITEM 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
10
     
                ITEM 3.
Quantitative and Qualitative Disclosure about Market Risk
12
     
        ITEM 4.
Controls and Procedures
12
     
                ITEM 4T.
Controls and Procedures
14
     
PART 11.
OTHER INFORMATION
14
     
ITEM 1.
Legal Proceedings
14
     
                ITEM 1A.
Risk Factors
14
     
ITEM 2.
Unregistered Sales of Equity Securities and Use of Proceeds
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
     
 
SIGNATURES.
16
     




 
-2-
 


PART 1 – FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

The accompanying balance sheets of Standard Capital Corporation (development stage company) at May 31, 2010 (with comparative figures as at August 31, 2009) and the statement of operations for the three and nine months ended May 31, 2010 and 2009 and from September 24, 1998 (date of incorporation) to May 31, 2010 and the statement of cash flows for the nine months ended May 31, 2010 and 2009 and for the period from September 24, 1998 (date of incorporation) to May 31, 2010 have been prepared by the Company’s management in conformity with accounting principles generally accepted in the United States of America.  In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.

Operating results for the three and nine months ended May 31, 2010, are not necessarily indicative of the results that can be expected for the year ending August 31, 2010.



 
 
-3-
 




STANDARD CAPITAL CORPORATION
(Development Stage Company)

BALANCE SHEETS

(Unaudited – Prepared by Management)

 
May 31, 2010
August 31, 2009
     
ASSETS
    
     
CURRENT ASSETS
    
     
    Cash
$          106
$      3,441
     
       Total Current Assets
$          106
$      3,441
     
     
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY
    
     
CURRENT LIABILITIES
    
     
    Accounts payable
$      98,223
$    95,626
    Accounts payable – related parties
 15,988
   15,355
     
      Total Current Liabilities
114,211
 110,981
     
STOCKHOLDERS’ DEFICIENCY
    
     
    Common Stock
    
         200,000,000 shares authorized, at $0.001 par value
         2,285,000 shares issued and outstanding
 
2,285
 
2,285
    Capital in excess of par value
99,615
96,465
    Deficit accumulated during the Development stage
(216,005)
(206,290)
                Total Stockholders’ Deficiency
(114,105)
(107,540)
     
 
$           106
$     3,441
     




The accompanying notes are an integral part of these unaudited financial statements


 
-4-
 

 
STANDARD CAPITAL CORPORATION
(Development Stage Company)

STATEMENT OF OPERATIONS

For the Three and Nine Months Ended May 31, 2010 and 2009 and the Period
September 24, 1998 (Date of Inception) to May 31, 2010

(Unaudited – Prepared by Management)

 
Three months
ended
May 31, 2010
Three months
ended
May 31,  2009
Nine Months
Ended
May 31, 2010
Nine Months
Ended
May 31, 2009
Date of
Inception to
May 31,  2010
           
SALES
$           -
$          -
$            -
$              -
$             -
           
GENERAL AND ADMINISTRATIVE
  EXPENSES:
          
           
Accounting and audit
1,850
1,750
5,350
5,250
77,980
Annual general meeting
-
-
-
-
2,250
Bank charges and interest
19
20
85
61
2,168
Consulting fees
-
-
-
-
17,500
Edgar filing fees
250
250
750
750
11,779
Filing fees
-
  -
-
-
1,895
Geological report
-
-
-
-
2,780
Incorporation costs
-
-
-
-
255
Legal fees
-
-
-
-
6,987
Management fees
600
600
1,800
1,800
28,200
Miscellaneous
-
-
-
-
1,600
Office expenses
40
31
230
131
6,971
Rent
300
300
900
900
14,100
Staking and explorationcosts
-
   -
-
-
17,617
Telephone
150
150
450
450
7,050
Transfer agent’s fees
-
-
150
250
11,850
Travel and entertainment
         -
          -
        -
        -
5,023
           
NET LOSS
$ (3,209)
$ ( 3,101)
$ (9,715)
$   (9,592)
$  (216,005)
           
NET LOSS PER COMMON SHARE
          
Basic
$   (0.00)
$    (0.00)
      $ (0.00)
    $  (0.00)
 
           
AVERAGE OUTSTANDING SHARES
          
Basic
2,285,000
2,285,000
  2,285,000
  2,285,000
  


The accompanying notes are an integral part of these unaudited financial statements.
 
 
 
 
-5-
 

 
STANDARD CAPITAL CORPORATION
(Development Stage Company)

STATEMENT OF CASH FLOWS

For the nine months ended May 31, 2010 and 2009 and the Period
September 24, 1998 (Date of Inception) to May 31, 2010

(Unaudited – Prepared by Management)

 
For the nine months ended
May 31, 2010
For the nine months ended
May 31, 2009
Sept 24, 1998
to May 31, 2010
       
CASH FLOWS FROM OPERATING ACTIVITIES:
      
   
 
  
     Net loss
$   (9,715)
$    (9,592)
  $   (216,005)
       
     Adjustments to reconcile net loss to net cashprovided by operating activities:
      
       
        Change in accounts payable
2,597
1,553
98,223
        Capital contributions – expenses
    3,150
   3,150
49,350
       
             Net Change in Cash from Operations
 (3,968)
 (4,889)
       (68,432)
       
CASH FLOWS FROM INVESTING ACTIVITIES
            -
           -
             -
       
CASH FLOWS FROM FINANCING ACTIVITIES:
      
   
 
  
Advances from related parties
 633
4,632
15,988
Proceeds from issuance of common stock
          -
           -
52,550
       
    Cash flows from financing activities
       633
    4,632
68,538
       
     Net (Decrease) Increase in Cash
(3,335)
(257)
106
       
     Cash at Beginning of Period
 3,441
3,318
                   -
       
     CASH AT END OF PERIOD
$        106    
$    3,061
    $          106  



The accompanying notes are an integral part of these unaudited financial statements.



 
-6-
 



STANDARD CAPITAL CORPORATION
(Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
May 31, 2010

(Unaudited – Prepared by Management)
 
 
1.           ORGANIZATION

The Company was incorporated under the laws of the State of Delaware on September 24, 1998 with the authorized common stock of 25,000,000 shares at $0.001 par value.

 
The shareholders, at the Annual General Meeting held on February 20, 2004, approved an amendment to the Certificate of Incorporation whereby the authorized share capital of the Company would be increased from 25,000,000 common shares with a par value of $0.001 per share to 200,000,000 common shares with a par value of $0.001 per share.

The Company was organized for the purpose of acquiring and developing mineral properties.  At the report date the Company has no mineral claim since it allowed the Standard claim to lapse in February 2008 and has not identified another claim to replace it.  Nevertheless, the Company continues to be in the development stage due to its intent to acquire another mineral claim in the immediate future.

2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Methods

The Company recognizes income and expenses based on the accrual method of accounting.

Dividend Policy

The Company has not yet adopted a policy regarding payment of dividends.

Income Taxes

 
The Company utilizes the liability method of accounting for income taxes.  Under the liability method deferred tax assets and liabilities are determined based on differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to be reversed.   An allowance against deferred tax assets is recorded, when it is more likely than not, that such tax benefits will not be realized.

On May 31, 2010, the Company had a net operating loss carry forward of $216,005.  The tax benefit of approximately $64,800 from the loss carry forward has been fully offset by a valuation reserve because the use of the future tax benefit is doubtful since the Company has no operations.  The loss carry forward will expire starting in 2022 through 2030.



 
-7-
 



 
 

STANDARD CAPITAL CORPORATION
(Development Stage Company)
NOTES  TO  FINANCIAL  STATEMENTS
May 31, 2010

(Unaudited – Prepared by Management)

2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

 
Statement of Cash Flows

 
For the purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents.

 
Basic and Diluted Net Income (loss) Per Share

 
Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding.   Diluted net income (loss) per share amounts are computed using the weighted average number of common and common equivalent shares outstanding as if shares had been issued on the exercise of any common share rights unless the exercise becomes antidilutive and then only the basic per share amounts are shown in the report.

             Revenue Recognition

Revenue is recognized on the sale and transfer of goods or completion of service.

Advertising and Market Development

The company expenses advertising and market development costs as incurred.

             Financial and Concentrations Risk

The Company does not have any concentration or related financial credit risk.

 
             Environmental Requirements

 
At the report date any environmental requirements related to the mineral claim acquired are unknown and therefore an estimate of any future cost cannot be made.

            Estimates and Assumptions

Management uses estimates and assumptions in preparing financial statements in accordance with accounting principles accepted in the United States of America.  Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.   Actual results could vary from the estimates that were assumed in preparing these financial statements.

Financial Instruments

The carrying amounts of financial instruments, including cash and accounts payable, are considered by management to be their estimated fair value due to their short term maturities.

 
 
 
-8-
 
 

 

STANDARD CAPITAL CORPORATION
(Development Stage Company)
NOTES  TO  FINANCIAL  STATEMENTS
May 31, 2010

(Unaudited – Prepared by Management)

2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

Recent Accounting Pronouncements

The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements.

3.           SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

On May 31, 2010, officers-directors and their families had acquired 12% of the common capital stock issued, and have made no interest, demand loans of $15,988 and have made contributions to capital of $49,350 to the Company in the form of expenses paid for the Company.

4.
STOCK OPTION PLAN

 
At the Annual General Meeting held on February 20, 2004, the shareholders approved a Stock Option Plan (the “Plan”) whereby a maximum of 5,000,000 common shares were authorized but unissued to be granted to directors, officers, consultants and non-employees who assisted in the development of the Company.   The value of the stock options to be granted under the Plan will be determined on the fair market value of the Company’s shares when they are listed on any established stock exchange or a national market system at the closing price as at the date of granting the option.   No stock options have been granted under this Plan.

5.
CAPITAL STOCK

 
The Company has completed one Regulation D offering of 1,295,000 shares of its capital stock for $3,050.  In addition, the Company has completed an Offering Memorandum whereby 990,000 common shares were issued for at a price of $0.05 per share for $49,500.

6.
GOING CONCERN

 
The Company will need additional working capital to service its debt and for its intended purpose of acquiring another mineral claim, which raises substantial doubt about its ability to continue as a going concern.   Continuation of the Company as a going concern is dependent upon obtaining additional working capital and the management of the Company has developed a strategy, which it believes will accomplish this objective through additional equity funding, and long term financing, which will enable the Company to operate for the coming year.

7.         SUBSEQUENT EVENTS

 The Company has evaluated subsequent events from the balance sheet through June 20, 2010 and has found no material subsequent events to report.


 
-9-
 



ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the information contained in the financial statements of Standard Capital Corporation (“Standard”) and the notes which form an integral part of the financial statements which are attached hereto.

The financial statements mentioned above have been prepared in conformity with accounting principles generally accepted in the United States of America and are stated in United States dollars.

Standard presently has minimal day-to-day operations; mainly comprising the maintaining of the Standard claim in good standing on an annual basis and preparing the various reports to be filed with the United States Securities and Exchange Commission (the “SEC”) as required.

LIQUIDITY AND CAPITAL RESOURCES

Standard has had no revenue since inception and its accumulated deficit is $216,005.  To date, the growth of Standard has been funded by the sale of shares and advances by its former director in order to meet the requirements of filing with the SEC.

Standard has not yet identified a mineral property to replace the Standard claim which was allowed to lapse on February 23, 2008.   Presently Standard does not have the funds to consider any additional mineral claims.   Management is considering the raising of additional funds through the sale of shares but no decision as to the price and number of shares to be issued has been decided upon.

Management estimates that a minimum of $24,305 will be required over the next twelve months to pay for such expenses as bookkeeping ($5,250), auditing ($4,550), Edgar fees ($1,155), filing fees to maintain Standard in good standing with the State of Delaware and payment to Standard’s registrant ($300), identifying a new mineral claim and obtaining geological report thereon ($10,000), office and miscellaneous ($750), annual general meeting mail costs, holding of meeting, etc. ($1,100) and payments to the transfer agent ($1,200).  The above noted figure does not include amounts owed to third party creditors in the amount of $98,223 as at May 31, 2010. The amount required to cover total operating costs for the next twelve months and to settle all the outstanding amounts owed to third party creditors would be $122,528.  At present Standard does not have these funds to pay for future expenses and eliminate accounts payable and therefore would be required to either sell shares in its capital stock or obtain further advances from its director.  Standard’s future operations and growth is dependent on its ability to raise capital for expansion and to seek revenue sources.

RESULTS OF OPERATIONS

The Standard claim

The Standard claim lapsed without the Company undertaking any exploration work during the past year due to management feeling there was not significant mineral value in the claim.   It expired on February 23, 2008.   The Company no longer has any rights to the minerals on the Standard claim nor any liability attached thereto.

The new management of Standard is seeking another mineral claim of merit but at this time has not identified any mineral claim.

Standard has undertaken no product research and development since inception.  Management has no plans to purchase or sell any plant or significant equipment in the foreseeable future.  In addition, Standard does not expect a significant change in the number of employees in the immediate future.
 
 
 
-10-
 
 
 

 
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Market Information

There are no common shares subject to outstanding options, warrants or securities convertible into common equity of our Company.
 
The number of shares subject to Rule 144 is 1,090,000   Share certificates representing these shares have the appropriate legend affixed on them.

There are no shares being offered to the public other than indicated in our effective registration statement and no shares have been offered pursuant to an employee benefit plan or dividend reinvestment plan.
Our shares are traded on the OTCBB.  Although the OTCBB does not have any listing requirements per se, to be eligible for quotation on the OTCBB, we must remain current in our filings with the SEC; being as a minimum Forms 10-Q and 10-K.  Securities already quoted on the OTCBB that become delinquent in their required filings will be removed following a 30 or 60 day grace period if they do not make their filing during that time.

In the future our common stock trading price might be volatile with wide fluctuations.  Things that could cause wide fluctuations in our trading price of our stock could be due to one of the following or a combination of several of them:

●
our variations in our operations results, either quarterly or annually;
   
●
trading patterns and share prices in other exploration companies which our shareholders consider similar to ours;
   
●
the merits of a new mineral claim, and
   
●
other events which we have no control over.

In addition, the stock market in general, and the market prices for thinly traded companies in particular, have experienced extreme volatility that often has been unrelated to the operating performance of such companies.  These wide fluctuations may adversely affect the trading price of our shares regardless of our future performance.  In the past, following periods of volatility in the market price of a security, securities class action litigation has often been instituted against such company.  Such litigation, if instituted, whether successful or not, could result in substantial costs and a diversion of management’s attention and resources, which would have a material adverse effect on our business, results of operations and financial conditions.
 
Trends
 
We are in the developments stage, have not generated any revenue and have no prospects of generating any revenue in the foreseeable future.  We are unaware of any known trends, events or  uncertainties that have had, or are reasonably likely to have, a material impact on our business or income, either in the long term or short term, as more fully described under ‘Risk Factors’.
 
ITEM 4.                      CONTROLS AND PROCEDURES

(a)           Evaluation of Disclosure Controls and Procedures

The Company has considered certain internal control procedures as required by the Sarbanes-Oxley (“SOX”) Section 404 A which accomplishes the following:
 
 
 
-11-
 
 
 
 
Internal controls are mechanisms to ensure objectives are achieved and are under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer. Good controls encourage efficiency, compliance with laws and regulations, sound information, and seek to eliminate fraud and abuse.
 
These control procedures provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.
 
Internal control is "everything that helps one achieve one's goals - or better still, to deal with the risks that stop one from achieving one's goals."
 
Internal controls are mechanisms that are there to help the Company manage risks to success.
 
Internal controls is about getting things done (performance) but also about ensuring that they are done properly (integrity) and that this can be demonstrated and reviewed (transparency and accountability).
 
In other words, control activities are the policies and procedures that help ensure the Company’s management directives are carried out. They help ensure that necessary actions are taken to address risks to achievement of the Company’s objectives. Control activities occur throughout the Company, at all levels and in all functions. They include a range of activities as diverse as approvals, authorizations, verifications, reconciliations, reviews of operating performance, security of assets and segregation of duties.

As of May 31, 2010, the management of the Company assessed the effectiveness of the Company’s internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and SEC guidance on conducting such assessments.  Management concluded, during the three months ended May 31, 2010, internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules.   Refer to comments below.  Management realized there are deficiencies in the design or operation of the Company’s internal control that adversely affected the Company’s internal controls which management considers to be material weaknesses.

In the light of management’s review of internal control procedures as they relate to COSO and the SEC the following were identified:

●              The Company’s Audit Committee does not function as an Audit Committee should since there is a lack of independent directors on the Committee and the Board of Directors has not identified an “expert”, one who is knowledgeable about reporting and financial statements requirements, to serve on the Audit Committee.

●              The Company has limited segregation of duties which is not consistent with good internal control procedures.

●              The Company does not have a written internal control procedurals manual which outlines the duties and reporting requirements of the Directors and any staff to be hired in the future.  This lack of a written internal control procedurals manual does not meet the requirements of the SEC or good internal control.

●              There are no effective controls instituted over financial disclosure and the reporting processes.

Management feels the weaknesses identified above, being the latter three, have not had any affect on the financial results of the Company.    Management will have to address the lack of independent members on the Audit Committee and identify an “expert” for the Committee to advise other members as to correct accounting and reporting procedures.
 
 
 
-12-
 
 

 
The Company and its management will endeavor to correct the above noted weaknesses in internal control once it has adequate funds to do so.   Appointing independent members to the Audit Committee and using the services of an expert on the Committee will greatly improve the overall performance of the Audit Committee.   With the addition of other Board Members and staff the segregation of duties issue will be addressed and will no longer be a concern to management.  Having a written policy manual outlining the duties of each of the officers and staff of the Company will facilitate better internal control procedures.

Management will continue to monitor and evaluate the effectiveness of the Company’s internal controls and procedures and its internal controls over financial reporting on an ongoing basis and is committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

ITEM 4A.                      CONTROLS AND PROCEDURES
 
There were no material changes in the Company’s internal controls or in other factors that could materially affect the Company’s disclosure controls and procedures subsequent to the Evaluation Date, nor any significant deficiencies or material weaknesses in such disclosure controls and procedures requiring corrective actions.

PART 11 – OTHER INFORMATION

ITEM 1.                      LEGAL PROCEEDINGS

There are no legal proceedings to which Standard is a party nor to the best of management’s knowledge are any material legal proceedings contemplated.
 
ITEM 1A                      RISK FACTORS
 
There are certain risk factors regarding Standard’s operations which might affect the outcome of its ability to operate in the future.  An investment in Standard’s securities involves an exceptionally high degree of risk and is extremely speculative. The following risk factors reflect the potential and substantial material risks which could be involved if you decide to purchase shares in Standard.
 
Risks Associated with Standard:
 
1.  
Because Standard’s auditors have issued a going concern opinion and because its officers and directors will not loan any money to it, Standard may not be able to achieve its objectives and may have to suspend or cease exploration activity.
 
Standard’s auditors' report on its 2009 financial statements expressed an opinion that substantial doubt exists as to whether Standard can continue as an ongoing business for the next twelve months. Because its officers and directors are unwilling to loan or advance capital to it, Standard believes that if it does not raise additional capital through the issuance of treasury shares, Standard will be unable to conduct exploration activity and may have to cease operations and go out of business.
 
2.  
With the expiry of the Standard mineral claim, the Company has no assets to build a future thereon.
 
On February 23, 2008, the Company did not maintain the Standard claim in good standing and therefore lost all rights to the minerals thereon.   This has resulted in the Company having no assets to build its future on.   Without any assets, the Company might not be able to raise future funding and therefore will cease to exist as a company.
 
 
 
-13-
 
 
 
 
3.  
Standard lacks an operating history and has losses which it expects to continue into the future. As a result, Standard may have to suspend or cease exploration activity or cease operations.
 
Standard was incorporated in 1998 and its limited exploration activities have not generated any revenues. Standard has an insufficient exploration history upon which to properly evaluate the likelihood of its future success or failure.  Standard’s net loss from inception to May 31, 2010 is $216,005. Its ability to achieve and maintain profitability and positive cash flow in the future is dependent upon
 
 
*
Its ability to locate a profitable mineral property
 
*
Its ability to locate an economic ore reserve
 
*
Its ability to generate revenues
 
*
Its ability to reduce exploration costs.
 
Based upon current plans, Standard expects to incur operating losses in future periods. This will happen because there are expenses associated with identifying a new mineral property, obtaining a geological report and undertaking preliminary explorations work on the new mineral claim.  Standard cannot guarantee it will be successful in generating revenues in the future. Failure to generate revenues will cause it to go out of business.
 
4.  
Because Standard’s officers and directors do not have technical training or experience in managing a public company, it will have to hire qualified personnel to fulfill these functions. If Standard lacks funds to retain such personnel, or cannot locate qualified personnel, it may have to suspend or cease exploration activity or cease operations which will result in the loss of its shareholders’ investment.
 
Standard’s officers and directors have no direct training or experience in managing and fulfilling the regulatory reporting obligations of a ‘public company’ like Standard.  Unless its two officers and directors are willing to spend more time addressing these matters, it will have to hire professionals to undertake these filing requirements for Standard and this will increase the overall cost of operations.
 
As a result Standard may have to suspend or cease exploration activity, or cease operations altogether, which will result in the loss of its shareholders’ investment.
 
5.  
Because Standard’s officers and directors have other outside business activities and may not be in a position to devote a majority of their time to Standard’s exploration activity, its exploration activity may be sporadic which may result in periodic interruptions or suspensions of exploration.
 
Standard’s new President and CEO, Alexander Borco Magallano, Professional Geologist, will be devoting only 15% of his time, approximately 15 hours per month, to Standard’s operations of its business.  Standard’s new Secretary-Treasurer, Rudy Belloy Perez, Professional Geologist, and its other director, B. Gordon Brooke, will be devoting only 5 to 10 hours per month to Standard’s operations.  As a consequence Standard’s business may suffer.  For example,  because its officers and directors have other outside business activities and may not be in a position to devote a majority of their time to Standard’s exploration activity, its exploration activity may be sporadic or may be periodically interrupted or suspended.   Such suspensions or interruptions may cause us to cease operations altogether and go out of business.
 

 
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6.  Standard anticipates the need to sell additional treasury shares in the future meaning that there will be a dilution to its existing shareholders resulting in their percentage ownership in Standard being reduced accordingly.

Standard expects that the only way it will be able to acquire additional funds is through the sale of its common stock.  This will result in a dilution effect to its shareholders whereby their percentage ownership interest in Standard is reduced.  The magnitude of this dilution effect will be determined by the number of shares Standard will have to issue in the future to obtain the funds required.
 
 
7.  Because Standard’s securities are subject to penny stock rules, its shareholders may have difficulty reselling their shares.
 
Standard’s shares are "penny stocks" and are covered by Section 15(g) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell the Company's securities including the delivery of a standardized disclosure document; disclosure and confirmation of quotation prices; disclosure of compensation the broker/dealer receives; and, furnishing monthly account statements. For sales of Standard’s securities, the broker/dealer must make a special suitability determination and receive from its customer a written agreement prior to making a sale. The imposition of the foregoing additional sales practices could adversely affect a shareholder's ability to dispose of his stock.

ITEM 2.                      UNREGISTERED SALE OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3.                      DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.                      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5.                      OTHER INFORMATION

None

ITEM 6.                      EXHIBITS

(a)           Exhibits

1.           Certificate of Incorporation, Articles of Incorporation and By-laws

1.1
Certificate of Incorporation (incorporated by reference from Standard’s Registration Statement on Form 10-SB filed on December 6, 1999)

1.2
Articles of Incorporation (incorporated by reference from Standard’s Registration Statement on Form 10-SB filed on December 6, 1999)

1.3
By-laws (incorporated by reference from Standard’s Registration Statement on Form 10-SB filed on December 6, 1999)



 
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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 thereunto duly authorized.


STANDARD CAPITAL CORPORATION
(Registrant)


ALEXANDER B. MAGALLANO
Alexander B. Magallano
Chief Executive Officer
President and Director

Dated: June 23, 2010

GORDON BROOKE
B. Gordon Brooke
Chief Accounting Officer
Chief Financial Officer
and Director

Dated: June 23, 2010
 

 
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