UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 2004
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period to
Commission file number 33-00215
UNITED STATES ANTIMONY CORPORATION
(Name of small business issuer in its charter)
MONTANA 81-0305822
------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
P.O. BOX 643, THOMPSON FALLS, MONTANA 59873
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (406) 827-3523
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act 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
------ -------
At August 12, 2004, the registrant had outstanding 30,748,816 shares of par
value $0.01 common stock.
UNITED STATES ANTIMONY CORPORATION
QUARTERLY REPORT ON FORM 10-QSB
FOR THE QUARTERLY PERIOD
ENDED JUNE 30, 2004
TABLE OF CONTENTS
Page
PART I - FINANCIAL INFORMATION
Item 1: Financial Statements. . . . . . . . . . . . . . . . . . . . . . 1
Item 2: Management's Discussion and Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . . . . . . . 6
Item 3: Controls and Procedures . . . . . . . . . . . . . . . . . . . . 8
PART II - OTHER INFORMATION
Item 1: Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . 9
Item 2: Changes in Securities . . . . . . . . . . . . . . . . . . . . . 9
Item 3: Defaults among Senior Securities. . . . . . . . . . . . . . . . 9
Item 4: Submission of Matters to a Vote of Security Holders . . . . . . 9
Item 5: Other Information . . . . . . . . . . . . . . . . . . . . . . . 9
Item 6: Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . 9
SIGNATURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
CERTIFICATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
[The balance of this page has been intentionally left blank.]
PART I-FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
JUNE 30, DECEMBER 31,
2004 2003
ASSETS
Current assets:
Accounts receivable, less allowance
for doubtful accounts of $30,000 . . . . . . . . . . . . . . . $ 42,551 $ 51,081
Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . 140,136 153,053
-------------- -------------
Total current assets . . . . . . . . . . . . . . . . . . 182,687 204,134
Investment in USAMSA, net. . . . . . . . . . . . . . . . . . . . . 11,113 11,913
Properties, plants and equipment, net. . . . . . . . . . . . . . . 633,400 554,311
Restricted cash for bank note payable. . . . . . . . . . . . . . . 0 105,649
Restricted cash for reclamation bonds. . . . . . . . . . . . . . . 99,043 99,043
Deferred financing costs . . . . . . . . . . . . . . . . . . . . . 26,251 30,000
-------------- -------------
Total assets . . . . . . . . . . . . . . . . . . . . . . $ 952,494 $ 1,005,050
============== =============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Checks issued and payable. . . . . . . . . . . . . . . . . . . . $ 103,625 $ 87,927
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . 559,824 909,696
Accrued payroll and property taxes . . . . . . . . . . . . . . . 158,583 197,761
Accrued payroll and other. . . . . . . . . . . . . . . . . . . . 90,324 88,085
Judgment payable . . . . . . . . . . . . . . . . . . . . . . . . 54,830 53,130
Accrued interest payable . . . . . . . . . . . . . . . . . . . . 19,606 16,645
Payable to related parties . . . . . . . . . . . . . . . . . . . 241,854 232,111
Notes payable to bank, current . . . . . . . . . . . . . . . . . 139,736 144,391
Accrued reclamation costs, current . . . . . . . . . . . . . . . 151,000 151,000
-------------- -------------
Total current liabilities. . . . . . . . . . . . . . . . 1,519,382 1,880,746
Secured convertible and convertible notes payable. . . . . . . . . 350,000 350,000
Notes payable to bank, noncurrent. . . . . . . . . . . . . . . . . 393,827 409,141
Accrued reclamations costs, noncurrent . . . . . . . . . . . . . . 57,500 57,500
-------------- -------------
Total liabilities. . . . . . . . . . . . . . . . . . . . 2,320,709 2,697,387
-------------- -------------
Commitments and contingencies (Note 3)
Stockholders' deficit:
Preferred stock, $0.01 par value, 10,000,000 shares authorized:
Series A: 4,500 shares issued and outstanding
(liquidation preference $123,750 at December 31, 2003) . . 45 45
Series B: 750,000 shares issued and outstanding
(liquidation preference $825,000 at December 31, 2003) . . 7,500 7,500
Series C: 177,904 shares issued and outstanding
(liquidation preference $97,847 at December 31, 2003). . . 1,779 1,779
Series D: 1,836,672 shares issued and outstanding
(liquidation preference $4,659,180 at December 31, 2003) . 18,636 18,636
Common stock, $0.01 par value, 50,000,000 shares
authorized; 30,748,816 and 28,114,288 issued and outstanding . 307,489 281,143
Additional paid-in capital . . . . . . . . . . . . . . . . . . . 17,908,984 17,387,970
Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . . (19,612,648) (19,389,410)
---------------- -------------
Total stockholders' deficit. . . . . . . . . . . . . . . (1,368,215) (1,692,337)
---------------- -------------
Total liabilities and stockholders' deficit. . . . . . . $ 952,494 $ 1,005,050
=============== =============
The accompanying notes are an integral part of the financial statements.
1
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
2004 2003 2004 2003
Revenues:
Sales of antimony products and other . . . . . $ 510,324 $ 542,359 $ 1,092,739 $ 1,561,855
Sales of zeolite products. . . . . . . . . . . 342,013 143,058 537,099 263,758
------------ ------------ ------------ ------------
852,337 685,417 1,629,838 1,825,613
Cost of sales:
Cost of antimony production. . . . . . . . . . 442,614 470,254 849,235 1,245,920
Cost of zeolite production . . . . . . . . . . 192,320 129,269 346,920 252,537
Antimony depreciation. . . . . . . . . . . . . 10,300 9,476 20,600 18,953
Zeolite depreciation . . . . . . . . . . . . . 13,800 13,686 27,600 27,372
Antimony freight and delivery. . . . . . . . . 35,526 62,635 79,683 140,313
Zeolite freight and delivery . . . . . . . . . 115,843 18,058 130,514 38,651
------------ ------------ ------------ ------------
810,403 703,378 1,454,552 1,723,746
Gross profit (loss). . . . . . . . . . . . . . . 41,934 (17,961) 175,286 101,867
------------ ------------ ------------ ------------
Other operating expenses:
Bear River Zeolite general and administrative. 18,789 69,860 89,950 143,174
Antimony general and administrative. . . . . . 62,004 98,995 152,544 229,879
Bear River Zeolite sales expenses. . . . . . . 15,428 14,829 34,592 29,265
Antimony sales expenses. . . . . . . . . . . . 11,805 9,398 25,873 34,966
------------ ------------ ------------ ------------
108,026 193,082 302,959 437,284
------------ ------------ ------------ ------------
Other (income) expense:
Interest expense . . . . . . . . . . . . . . . 30,473 16,651 57,785 33,027
Factoring expense. . . . . . . . . . . . . . . 20,964 27,659 40,243 61,224
Interest income and other. . . . . . . . . . . (1,977) (5,044) (2,463) (5,649)
------------ ------------ ------------ ------------
49,460 39,266 95,565 88,602
------------ ------------ ------------ ------------
Net loss . . . . . . . . . . . . . . . . . . . . $ (115,552) $ (250,309) $ (223,238) $ (424,019)
============ ============ ============ ============
Basic net loss per share of common stock . . . . $ Nil $ Nil $ Nil $ Nil
============ ============ ============ ============
Basic weighted average shares outstanding. . . . 30,435,217 27,027,959 29,512,745 27,027,959
============ ============ ============ ============
The accompanying notes are an integral part of the financial statements.
2
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED
JUNE 30, JUNE 30,
2004 2003
Cash flows from operating activities:
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(223,238) $(424,019)
Adjustments to reconcile net loss to net cash used by operations:
Depreciation and amortization . . . . . . . . . . . . . . . . 52,750 50,324
Series D stock issued to directors. . . . . . . . . . . . . . 0 7,800
Series D stock issued for legal services. . . . . . . . . . . 0 20,100
Change in:
Restricted cash . . . . . . . . . . . . . . . . . . . . . . 105,649 (11,484)
Accounts receivable . . . . . . . . . . . . . . . . . . . . 8,530 76,712
Inventories . . . . . . . . . . . . . . . . . . . . . . . . 12,917 36,204
Accounts payable. . . . . . . . . . . . . . . . . . . . . . (199,727) 67,029
Accrued payroll and property taxes. . . . . . . . . . . . . (39,178) (68,492)
Accrued payroll and other . . . . . . . . . . . . . . . . . 2,239 6,106
Judgment payable. . . . . . . . . . . . . . . . . . . . . . 1,700 1,700
Accrued interest payable. . . . . . . . . . . . . . . . . . 2,961 (4,023)
Payable to related parties. . . . . . . . . . . . . . . . . 9,743 (44,310)
Accrued reclamation costs . . . . . . . . . . . . . . . . . 0 (13,255)
---------- ----------
Net cash used by operating activities . . . . . . . . . . (265,654) (299,608)
---------- ----------
Cash flows from investing activities:
Purchase of properties, plants and equipment. . . . . . . . . . . (127,289) (32,573)
---------- ----------
Net cash used in investing activities . . . . . . . . . . (127,289) (32,573)
---------- ----------
Cash flows from financing activities:
Proceeds from stock subscriptions payable 0 275,000
Proceeds from issuance of common stock and warrants . . . . . . . 10,000 0
Proceeds from exercise of warrants. . . . . . . . . . . . . . . . 387,214 0
Payments on notes payable to bank, net. . . . . . . . . . . . . . (142,090) (62,170)
Proceeds from notes payable to bank . . . . . . . . . . . . . . . 122,121 49,368
Change in checks issued and payable . . . . . . . . . . . . . . . 15,698 69,983
---------- ----------
Net cash provided by financing activities . . . . . . . . 392,943 332,181
---------- ----------
Net change in cash. . . . . . . . . . . . . . . . . . . . . . . . . 0 0
Cash, beginning of period . . . . . . . . . . . . . . . . . . . . . 0 0
---------- ----------
Cash, end of period . . . . . . . . . . . . . . . . . . . . . . . . $ 0 $ 0
========== ==========
Supplemental disclosures:
Non cash financing activities:
Common stock issued in satisfaction of accounts payable . . . . $ 150,145
==========
The accompanying notes are an integral part of the financial statements.
3
PART I - FINANCIAL INFORMATION, CONTINUED:
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION:
The unaudited consolidated financial statements have been prepared by the
Company in accordance with accounting principles generally accepted in the
United States of America for interim financial information, as well as the
instructions to Form 10-QSB. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. In the
opinion of the Company's management, all adjustments (consisting of only normal
recurring accruals) considered necessary for a fair presentation of the interim
financial statements have been included. Operating results for the three-month
period ended June 30, 2004 are not necessarily indicative of the results that
may be expected for the full year ending December 31, 2004. Certain
consolidated financial statement amounts for the three and six-month periods
ended June 30, 2003 have been reclassified to conform to the 2004
presentation. These reclassifications had no effect on the net loss or
accumulated deficit as previously reported.
For further information refer to the financial statements and footnotes thereto
in the Company's Annual Report on Form 10-KSB for the year ended December 31,
2003.
2. LOSS PER COMMON SHARE:
The Company accounts for its income (loss) per common share according to the
Statement of Financial Accounting Standards No. 128 "Earnings Per Share" ("SFAS
No. 128"). Under the provisions of SFAS No. 128, primary and fully diluted
earnings per share are replaced with basic and diluted earnings per share.
Basic earnings per share is arrived at by dividing net income (loss) available
to common stockholders by the weighted average number of common shares
outstanding, and does not include the impact of any potentially dilutive common
stock equivalents. Common stock equivalents, including warrants to purchase the
Company's common stock and common stock issuable upon the conversion of
debentures are excluded from the calculations when their effect is antidilutive.
3. COMMITMENTS AND CONTINGENCIES:
Until 1989, the Company mined, milled and leached gold and silver in the Yankee
Fork Mining District in Custer County, Idaho. In 1994, the U.S. Forest Service,
under the provisions of the Comprehensive Environmental Response Liability Act
of 1980 ("CERCLA"), designated the cyanide leach plant as a contaminated site.
In 1996, the Idaho Department of Environmental Quality requested that the
Company sign a consent decree related to completing the reclamation and
remediation at the Preachers Cove mill. The Company has been diligently
reclaiming the property and anticipates it will have the reclamation complete in
the near term.
The Company's management believes that USAC is currently in substantial
compliance with environmental regulatory requirements and that its accrued
environmental reclamation costs are representative of management's estimate of
costs required to fulfill its reclamation obligations. Such costs are accrued
at the time the expenditure becomes probable and the costs can reasonably be
estimated. The Company recognizes, however, that in some cases future
environmental expenditures cannot be reliably determined due to the uncertainty
of specific remediation methods, conflicts between regulating agencies relating
to remediation methods and environmental law interpretations, and changes in
environmental laws and regulations.
4
UNITED STATES ANTIMONY CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED), CONTINUED:
3. COMMITMENTS AND CONTINGENCIES, CONTINUED:
Any changes to the Company's reclamation plans as a result of these factors
could have an adverse affect on the Company's operations. The range of possible
losses in excess of the amounts accrued cannot be reasonably estimated at this
time.
4. BUSINESS SEGMENTS
The Company has two operating segments, antimony and zeolite. Management
reviews and evaluates the operating segments exclusive of interest and factoring
expenses. Therefore, interest expense is not allocated to the segments.
Selected information with respect to segments for the quarters ended June 30,
2004 and 2003 are as follows:
2004 2003
Revenues:
Antimony. . . . . . . . . . . . . . $510,324 $542,359
Zeolite . . . . . . . . . . . . . . 342,013 143,058
-------- ---------
$852,337 $685,417
======== =========
Cost of sales:
Production and freight and delivery:
Antimony. . . . . . . . . . . . . . $478,140 $532,889
Zeolite . . . . . . . . . . . . . . 308,163 147,327
Depreciation:
Antimony. . . . . . . . . . . . . . 10,300 9,476
Zeolite . . . . . . . . . . . . . . 13,800 13,686
-------- ---------
$810,403 $703,378
======== =========
Gross profit (loss) . . . . . . . . . . $ 41,934 $(17,961)
======== =========
Other operating expenses:
Sales expense:
Antimony. . . . . . . . . . . . . . $ 11,805 $ 9,398
Zeolite . . . . . . . . . . . . . . 15,428 14,829
General and administrative expense:
Antimony. . . . . . . . . . . . . . 62,004 98,995
Zeolite . . . . . . . . . . . . . . 18,789 69,860
-------- ---------
$108,026 $193,082
======== =========
Capital expenditures:
Antimony. . . . . . . . . . . . . . $ 19,700 $ 0
Zeolite . . . . . . . . . . . . . . 58,218 23,099
-------- ---------
$ 77,218 $ 23,099
======== =========
Properties, plant and equipment, net:
Antimony. . . . . . . . . . . . . . $128,208 $128,934
Zeolite . . . . . . . . . . . . . . 505,192 386,731
-------- ---------
$633,400 $515,665
======== =========
5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
General
This report contains both historical and prospective statements concerning the
Company and its operations. Prospective statements (known as "forward-looking
statements") may or may not prove true with the passage of time because of
future risks and uncertainties. The Company cannot predict what factors might
cause actual results to differ materially from those indicated by prospective
statements.
Results of Operations
For the three-month period ended June 30, 2004 compared to the three-month
period ended June 30, 2003
The Company's operations resulted in a net loss of $115,552 for the three-month
period ended June 30, 2004, compared with a net loss of $250,309 for the
three-month period ended June 30, 2003. The decrease in net loss during the
second quarter of 2004 compared to the net loss during the similar quarter of
2003 is primarily due to an increase in zeolite sales and a decrease in general
and administrative costs in the Bear River Zeolite Division. The Company expects
that in the fourth quarter of 2004 the worker's compensation insurance expense
for the Company will decrease dramatically.
Total revenues from antimony product sales for the second quarter of 2004 were
$510,324 compared with $542,359 during the comparable quarter of 2003, a
decrease of $32,035. During the three-month period ended June 30, 2004, 69% of
the Company's revenues from antimony product sales were from sales to one
customer (Kohler Co.) and 10.49% were from sales to a second individual
customer. Sales of antimony products during the second quarter of 2004
consisted of 326,465 pounds at an average sale price of $1.56 per pound. During
the second quarter of 2003 sales of antimony products consisted of 435,396
pounds at an average sale price of $1.25 per pound. The increase in sale prices
of antimony products from the second quarter of 2003 to the second quarter of
2004 is the result of a corresponding increase in antimony metal prices. The
decrease in pounds of antimony sold is attributed to difficulties in procuring
low priced raw material inventory and competition from Chinese suppliers.
Sales of zeolite products during the second quarter of 2004 were $342,013
compared to sales of $143,058 during the second quarter of 2003. Gross profit
from antimony and zeolite sales during the second three-month period of 2004 was
$41,934 compared with gross loss of $17,961 during the second three-month period
of 2003.
During the second quarter of 2004, the Company incurred expenses totaling
$34,217 associated with sales development and general and administrative
expenses of its wholly owned subsidiary, Bear River Zeolite, compared to $84,689
of expenses in the comparable quarter of 2003. The decrease in BRZ expenses was
principally due to a decrease in general and administrative expenses in the
second quarter 2004.
Antimony general and administrative expenses were $62,004 during the second
quarter of 2004, compared to $98,995 during the second quarter of 2003. The
decrease in general and administrative expenses during the second quarter of
2004 compared to the same quarter of 2003 was due to decreased repair,
maintenance and legal expenses.
Antimony sales expenses were $11,805 during the second quarter of 2004 compared
with $9,398 in the second quarter of 2003.
6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION, CONTINUED:
Interest expenses were $30,473 during the second quarter of 2004, compared to
interest expense of $16,651 incurred during the second quarter of 2003; the
increase in interest expense was due to the additional interest accrued on
convertible notes.
Accounts receivable factoring expense was $20,964 during the second quarter of
2004 compared to $27,659 of factoring expense incurred during the second quarter
of 2003. The decrease was primarily due to a decrease in finance charges.
Interest and other income increased from $1,977 during the second quarter of
2004 to $5,044 during the second quarter of 2003. The decrease was due to a
corresponding decrease in related cash bonds.
For the six-month period ended June 30, 2004 compared to the six-month period
ended June 30, 2003
The Company's operations resulted in a net loss of $223,238 for the six-month
period ended June 30, 2004, compared with a net loss of $424,019 for the
six-month period ended June 30, 2003. The decrease in net loss from the first
six months of 2004 compared to the first six months of 2003 is primarily due a
decrease in general administrative and factoring expenses in 2004.
Total revenues from antimony product sales for the first six months of 2004 were
$1,092,739 compared with $1,561,855 for the comparable period of 2003, a
decrease of $469,116. During the six-month period ended June 30, 2004, 65.4% of
the Company's revenues from antimony products sales were from sales to one
customer (Kohler Co.) and 10.2% were from sales to a second individual customer.
Sales of antimony products during the first six months of 2004 consisted of
727,961 pounds at an average sale price of $1.50 per pound. During the first
six months of 2003 sales of antimony products consisted of 1,187,077 pounds at
an average sale price of $1.32 per pound. The decrease in pounds of antimony
sold is attributed to difficulties in procuring low priced raw material
inventory and competition from Chinese suppliers. The increase in sale prices of
antimony products from the first six months of 2004 to the first six months of
2003 is the result of a corresponding increase in antimony metal prices.
Sales of zeolite products during the first six months of 2004 were $537,099
compared to sales of $263,758 during the comparable period of 2003. Gross
profit from antimony and zeolite sales during the first six-month period of 2004
was $175,286 compared with gross profit of $101,867 during the same six-month
period of 2003.
During the first six months of 2004, the Company incurred expenses totaling
$124,542 associated with sales development and general and administrative
expenses of its wholly owned subsidiary, Bear River Zeolite, compared to
$172,439 of expenses during the comparable period of 2003. The decrease in BRZ
expenses was principally due to a decrease in general and administrative
expenses.
Antimony general and administrative expenses were $152,544 during the first six
months of 2004, compared to $229,879 during the first six months of 2003. The
decrease in general and administrative expenses during the first six months of
2004 compared to the same period of 2003 was due to a decreased repair,
maintenance and legal expenses.
Antimony sales expenses were $25,873 during the first six months of 2004
compared with $34,966 in the first six months of 2003, the decrease was
principally due to the allocation of a portion of the Company's sales costs to
BRZ.
Interest expense was $57,785 during the first six months of 2004, compared to
interest expense of $33,027 incurred during the first six months of 2003. The
increase was due to increased convertible debt in 2004 compared to 2003.
7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION, CONTINUED:
Accounts receivable factoring expense was $40,243 during the first six months of
2004 compared to $61,224 of factoring expense incurred during the first six
months of 2003. The decrease was primarily due to decreased finance charges.
Interest and other income decreased from $5,649 during the first six months of
2003 to $2,463 during the first six months of 2004. The decrease was due to a
corresponding decrease in cash bonds.
Financial Condition and Liquidity
At June 30, 2004, Company assets totaled $952,494, and there was a stockholders'
deficit of $1,368,215. The stockholders' deficit decreased $324,122 from
December 31, 2003. The decrease is principally due to a decrease in accounts
payable relating to the issuance of common stock in satisfaction of certain
accrued legal fees and other payables during the six-month period ended June 30,
2004. At June 30, 2004, the Company's total current liabilities exceeded its
total current assets by $1,336,695. Included in the Company's current
liabilities are significant delinquent balances due raw materials suppliers,
attorneys, and payroll taxing agencies. The Company has, to date, been able to
sustain its operations through borrowings from major shareholders and sales
of common stock. Due to the Company's operating losses, negative working
capital, and stockholders' deficit, the Company's independent accountants
included a paragraph in the Company's 2003 financial statements relating to a
going concern uncertainty. To continue as a going concern the Company must
generate profits from its antimony and zeolite sales and acquire additional
capital resources from alternative financing resources. Without financing
and profitable operations, the Company may not be able to meet its obligations,
fund operations and continue in existence. While management is optimistic that
the Company will be able to sustain its operations and meet its financial
obligations, there can be no assurance of such.
Cash used by operating activities during the first six months of 2004 was
$265,654, and resulted primarily from the six-month net loss of $223,238.
Cash used in investing activities during the first six months of 2004 was
$127,289 and was almost entirely related to the construction of capital assets
at the Bear River Zeolite facility.
Cash provided by financing activities was $392,943 during the first six months
of 2004, and was principally generated by proceeds from exercise of 1,936,070
warrants for $387,214 and proceeds from notes payable to banks of $122,121.
ITEM 3. CONTROLS AND PROCEDURES
An evaluation was performed under the supervision and with the participation of
our management, including the President, of the effectiveness of the design and
operation of our disclosure controls and procedures. Based on that evaluation,
our management, including the President, concluded that disclosure controls and
procedures were effective as of June 30, 2004, in ensuring that all material
information required to be filed in this quarterly report has been made known to
them in a timely fashion.
There has been no change in our internal control over financial reporting during
the quarter ended June 30, 2004 that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.
8
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
Neither the constituent instruments defining the rights of the registrant's
securities filers nor the rights evidenced by the registrant's outstanding
common stock have been modified, limited or qualified. During the three-month
period ended June 30, 2004, the Company issued 800,000 shares of its restricted
common stock in connection with the exercise of $0.20 stock purchase warrants.
During the six-month period ended June 30, 2004 the Company issued a total of
1,136,071 shares of its restricted common stock in connection with the exercise
of $0.20 stock purchase warrants. In addition, during the six-month period ended
June 30, 2004, the Company issued 631,790 shares of its common stock in
connection with the extinguishment of certain accounts payable totaling
$150,145; and sold 66,667 shares of its common stock for $10,000 cash.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
The registrant has no outstanding senior securities.
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
Exhibits: None
Reports on Form 8-K: None
9
SIGNATURE
Pursuant to the requirements of Section 13 or 15(b) 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.
UNITED STATES ANTIMONY CORPORATION
(Registrant)
By:/s/John C. Lawrence Date: August 16, 2004
-------------------- ---------------
John C. Lawrence, Director and President
(Principal Executive, Financial and Accounting Officer)
10
CERTIFICATION
I, John C. Lawrence, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of United States
Antimony Corporation
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the small business
issuer as of, and for, the periods presented in this report.
4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
small business issuer and have:
a. designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the small business issuer,
including its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is being
prepared;
b. evaluated the effectiveness of the small business issuer's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
c. Disclosed in this report any change in the small business issuer's
internal control over financial reporting that occurred during the small
business issuer's most recent fiscal quarter that has materially affected, or
is reasonably likely to materially affect, the small business issuer's internal
control over financial reporting; and
5. I have disclosed, based on my most recent evaluation of internal control
over financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions);
a. all significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the small business issuer's ability to record,
process, summarize and report financial information; and
b. any fraud, whether or not material, that involves management or other
employees who have a significant role in the small business issuer's internal
control over financial reporting.
Date: August 16, 2004
-----------------
/s/ John C. Lawrence
----------------------
John C. Lawrence
President, Director and Principal Financial Officer
11
CERTIFICATION PURSUANT TO THE SARBANES-OXLEY ACT
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
I, John C. Lawrence, President, Director and Principal Financial Officer of
United States Antimony Corporation ("the "Registrant") do hereby certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. This Quarterly Report on Form 10-QSB of the Registrant for the period
ended June 30, 2004, as filed with the Securities and Exchange Commission (the
"Report"), fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Registrant.
Date:
/s/ John C. Lawrence
----------------------
John C. Lawrence
President, Director and Principal Financial Officer
12