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UNITED STATES ANTIMONY CORP - Quarter Report: 2021 September (Form 10-Q)

 

UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

For the quarterly period ended September 30, 2021

 

 

 

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 No. 001-08675

 

UNITED STATES ANTIMONY CORPORATION

(Exact name of Registrant as specified in its charter)

 

Montana

 

81-0305822

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

P.O. Box 643, Thompson Falls, Montana

(Address of principal executive offices)

 

Registrant’s telephone number: (406 )827-3523

 

Securities registered pursuant to Section 12(g) of the Act:

 

Title of Each Class

 

Trading Symbol(s)

 

Name of Each Exchange on Which Registered

Common Stock, $0.01 par value

 

UAMY

 

NYSE American

 

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 ☒      No ☐

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒      No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large Accelerated Filer

Accelerated Filer

Non-Accelerated Filer

Small Reporting Company

 

 

Emerging Growth Company

 

Indicated by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):Yes ☐      No ☒

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

At November 15, 2021, the registrant had outstanding 106,117,844 shares of par value $0.01 common stock.

 

 
 

  

UNITED STATES ANTIMONY CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE PERIOD 

ENDED SEPTEMBER 30, 2021

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

 

 

PART I – FINANCIAL INFORMATION

 

 

 

 

 

 

 

Item 1: Financial Statements (unaudited)

 

1-18

 

 

 

 

 

Item 2: Management’s Discussion and Analysis of Results of Operations and Financial Condition

 

19-23

 

 

 

 

 

Item 3: Quantitative and Qualitative Disclosure about Market Risk

 

24

 

 

 

 

 

Item 4: Controls and Procedures

 

24

 

 

 

 

 

PART II – OTHER INFORMATION

 

 

 

 

 

 

 

Item 1: Legal Proceedings

 

26

 

 

 

 

 

Item 2Unregistered Sales of Equity Securities and Use of Proceeds

 

26

 

 

 

 

 

Item 3: Defaults upon Senior Securities

 

26

 

 

 

 

 

Item 4: Mine Safety Disclosures

 

26

 

 

 

 

 

Item 5: Other Information

 

26

 

 

 

 

 

Item 6: Exhibits and Reports on Form 8-K

 

26

 

 

 

 

 

SIGNATURE

 

27

 

 

 

 

 

CERTIFICATIONS

 

 

 

  

[The balance of this page has been intentionally left blank.]

 

 
2

Table of Contents

  

PART I-FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

United States Antimony Corporation and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

September 30, 2021 and December 31, 2020

ASSETS

 

 

September 30,

2021

 

 

December 31,

2020

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$21,563,500

 

 

$665,102

 

Certificates of deposit

 

 

44,028

 

 

 

254,212

 

Accounts receivable

 

 

722,727

 

 

 

238,634

 

Inventories (Note 5)

 

 

733,956

 

 

 

650,213

 

Total current assets

 

 

23,064,211

 

 

 

1,808,161

 

 

 

 

 

 

 

 

 

 

Properties, plants and equipment, net (Note 13)

 

 

11,176,469

 

 

 

11,225,594

 

Restricted cash for reclamation bonds

 

 

57,275

 

 

 

57,275

 

IVA receivable and other assets

 

 

239,084

 

 

 

208,472

 

Total assets

 

$34,537,039

 

 

$13,299,502

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

 

 

 

 

 

 

 

 

Checks issued and payable

 

$-

 

 

$86,685

 

Accounts payable

 

 

1,252,846

 

 

 

1,876,874

 

Accrued liabilities (Note 6)

 

 

571,209

 

 

 

635,626

 

Payables to related party (Note 9)

 

 

-

 

 

 

227,432

 

Notes payable to bank (Note 7)

 

 

-

 

 

 

100,000

 

Export tax assessment payable (Note 11)

 

 

-

 

 

 

1,120,730

 

Hillgrove advances payable (Note 12)

 

 

-

 

 

 

378,074

 

Long-term debt, current portion (Note 8)

 

 

-

 

 

 

52,122

 

Total current liabilities

 

 

1,824,055

 

 

 

4,477,543

 

 

 

 

 

 

 

 

 

 

Long-term debt, net of current portion (Note 8)

 

 

-

 

 

 

34,304

 

Hillgrove advances payable (Note 12)

 

 

-

 

 

 

756,147

 

CARES Act note payable (Note 14)

 

 

-

 

 

 

443,400

 

Stock payable to directors for services (Note 10)

 

 

84,375

 

 

 

110,000

 

Asset retirement obligations and accrued reclamation costs

 

 

296,916

 

 

 

291,719

 

Total liabilities

 

 

2,205,346

 

 

 

6,113,113

 

Commitments and contingencies (Note 6 and 11)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Preferred stock $0.01 par value, 10,000,000 shares authorized:

 

 

 

 

 

 

 

 

Series A: -0- shares issued and outstanding

 

 

-

 

 

 

-

 

Series B: 750,000 shares issued and outstanding (liquidation preference $945,000 and $937,500 respectively)

 

 

7,500

 

 

 

7,500

 

Series C: 177,904 shares issued and outstanding (liquidation preference $97,847 both years)

 

 

1,779

 

 

 

1,779

 

Series D: 1,751,005 shares issued and outstanding (liquidation preference $5,084,770 and $5,043,622 respectively)

 

 

17,509

 

 

 

17,509

 

Common stock, $0.01 par value, 150,000,000 shares authorized; 106,117,844 and 75,949,757 shares issued and outstanding, respectively

 

 

1,061,177

 

 

 

759,496

 

Additional paid-in capital

 

 

63,992,101

 

 

 

39,050,899

 

Accumulated deficit

 

 

(32,748,373)

 

 

(32,650,794)

Total stockholders' equity

 

 

32,331,693

 

 

 

7,186,389

 

Total liabilities and stockholders' equity

 

$34,537,039

 

 

$13,299,502

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

 
3

Table of Contents

  

United States Antimony Corporation and Subsidiaries

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Operations - Unaudited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the three months ended

 

 

For the nine months ended

 

 

 

September 30,

2021

 

 

September 30,

2020

 

 

September 30,

2021

 

 

September 30,

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUES

 

$2,051,713

 

 

$1,007,231

 

 

$5,580,562

 

 

$4,335,413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COST OF REVENUES

 

 

1,950,504

 

 

 

1,442,322

 

 

 

5,070,798

 

 

 

4,685,388

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROSS PROFIT (LOSS)

 

 

101,209

 

 

 

(435,091)

 

 

509,764

 

 

 

(349,975)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

112,744

 

 

 

110,051

 

 

 

572,905

 

 

 

429,973

 

Salaries and benefits

 

 

72,200

 

 

 

82,308

 

 

 

226,137

 

 

 

288,455

 

Site care and maintenance expenses

 

 

-

 

 

 

-

 

 

 

184,037

 

 

 

24,250

 

Professional fees

 

 

28,227

 

 

 

43,557

 

 

 

212,563

 

 

 

161,167

 

Loss on abandonment of mineral properties

 

 

-

 

 

 

318,502

 

 

 

-

 

 

 

318,502

 

TOTAL OPERATING EXPENSES

 

 

213,171

 

 

 

554,418

 

 

 

1,195,642

 

 

 

1,222,347

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

 

(111,962)

 

 

(989,509)

 

 

(685,878)

 

 

(1,572,322)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

13,320

 

 

 

19

 

 

 

35,202

 

 

 

854

 

Interest expense

 

 

(590)

 

 

(3,750)

 

 

(3,725)

 

 

(14,937)

Gain on forgiveness of CARES Act debt (Note 14)

 

 

-

 

 

 

-

 

 

 

443,400

 

 

 

-

 

Grant income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,000

 

Gain on settlement of Hillgrove advance (Note 12)

 

 

-

 

 

 

-

 

 

 

113,422

 

 

 

-

 

TOTAL OTHER INCOME (EXPENSE)

 

 

12,730

 

 

 

(3,731)

 

 

588,299

 

 

 

(4,083)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS

 

 

(99,232)

 

 

(993,240)

 

 

(97,579)

 

 

(1,576,405)

Preferred dividends

 

 

(12,162)

 

 

(12,162)

 

 

(36,487)

 

 

(36,487)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss available to common stockholders

 

$(111,394)

 

$(1,005,402)

 

$(134,066)

 

$(1,612,892)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

common stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

Nil

 

 

$(0.01)

 

Nil

 

 

$(0.02)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

 

106,117,844

 

 

 

73,240,218

 

 

 

101,642,048

 

 

 

71,033,733

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

 
4

Table of Contents

  

United States Antimony Corporation and Subsidiaries

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statement of Changes in Stockholders' Equity

 

 

 

 

 

 

 

 

 

For the periods ended September 30, 2021 and September 30, 2020

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total  Preferred Stock

 

 

Common Stock

 

 

Additional

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Paid

 

 

Accumulated

 

 

Stockholders'

 

 Three months ended September 30,2021

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

In Capital

 

 

Deficit

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances, July 1, 2021

 

 

2,678,909

 

 

$26,788

 

 

 

106,005,234

 

 

$1,060,051

 

 

$63,883,227

 

 

$(32,649,141)

 

$32,320,925

 

Issuance of common stock to Directors (Note 10)

 

 

-

 

 

 

-

 

 

 

112,610

 

 

 

1,126

 

 

 

108,874

 

 

 

-

 

 

 

110,000

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(99,232)

 

 

(99,232)

Balances, September 30, 2021

 

 

2,678,909

 

 

$26,788

 

 

 

106,117,844

 

 

$1,061,177

 

 

$63,992,101

 

 

$(32,748,373)

 

$32,331,693

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total  Preferred Stock

 

 

Common Stock

 

 

Additional

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Paid

 

 

Accumulated

 

 

Stockholders'

 

 Three months ended September 30,2020

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

In Capital

 

 

Deficit

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances, July 1, 2020

 

 

2,678,909

 

 

$26,788

 

 

 

70,206,899

 

 

$702,068

 

 

$37,295,259

 

 

$(29,947,155)

 

$8,076,960

 

Issuance of common stock and warrants for cash

 

 

-

 

 

 

-

 

 

 

5,742,858

 

 

 

57,428

 

 

 

1,952,572

 

 

 

-

 

 

 

2,010,000

 

Common stock issuance costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(196,932)

 

 

-

 

 

 

(196,932)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(993,240)

 

 

(993,240)

Balances, September 30, 2020

 

 

2,678,909

 

 

$26,788

 

 

 

75,949,757

 

 

$759,496

 

 

$39,050,899

 

 

$(30,940,395)

 

$8,896,788

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total  Preferred Stock

 

 

 

Common Stock

 

 

Additional

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Paid

 

 

Accumulated

 

 

Stockholders'

 

 Nine months ended September 30,2021

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

In Capital

 

 

Deficit

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances, January 1, 2021

 

 

2,678,909

 

 

$26,788

 

 

 

75,949,757

 

 

$759,496

 

 

$39,050,899

 

 

$(32,650,794)

 

$7,186,389

 

Issuance of common stock for cash (Note 10)

 

 

-

 

 

 

-

 

 

 

26,290,000

 

 

 

262,900

 

 

 

24,734,100

 

 

 

-

 

 

 

24,997,000

 

Issuance of common stock to Directors (Note 10)

 

 

-

 

 

 

-

 

 

 

112,610

 

 

 

1,126

 

 

 

108,874

 

 

 

-

 

 

 

110,000

 

Common stock issuance costs (Note 10)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,654,820)

 

 

-

 

 

 

(1,654,820)

Common stock issued upon exercise of warrants (Note 10)

 

 

-

 

 

 

-

 

 

 

3,765,477

 

 

 

37,655

 

 

 

1,753,048

 

 

 

-

 

 

 

1,790,703

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(97,579)

 

 

(97,579)

Balances, September 30, 2021

 

 

2,678,909

 

 

$26,788

 

 

 

106,117,844

 

 

$1,061,177

 

 

$63,992,101

 

 

$(32,748,373)

 

$32,331,693

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total  Preferred Stock

 

 

Common Stock

 

 

Additional

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Paid

 

 

Accumulated

 

 

Stockholders'

 

 Nine months ended September 30,2020

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

In Capital

 

 

Deficit

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances, January 1, 2020

 

 

2,678,909

 

 

$26,788

 

 

 

69,661,436

 

 

$696,614

 

 

$37,107,730

 

 

$(29,363,990)

 

$8,467,142

 

Issuance of common stock upon exercise of warrants

 

 

-

 

 

 

-

 

 

 

250,000

 

 

 

2,500

 

 

 

60,000

 

 

 

-

 

 

 

62,500

 

Issuance of common stock to Directors

 

 

-

 

 

 

-

 

 

 

295,463

 

 

 

2,954

 

 

 

127,529

 

 

 

-

 

 

 

130,483

 

Issuance of common stock and warrants for cash

 

 

-

 

 

 

-

 

 

 

5,742,858

 

 

 

57,428

 

 

 

1,952,572

 

 

 

-

 

 

 

2,010,000

 

Common stock issuance costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(196,932)

 

 

-

 

 

 

(196,932)

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,576,405)

 

 

(1,576,405)

Balances, September 30, 2020

 

 

2,678,909

 

 

$26,788

 

 

 

75,949,757

 

 

$759,496

 

 

$39,050,899

 

 

$(30,940,395)

 

$8,896,788

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

 
5

Table of Contents

  

United States Antimony Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows - Unaudited

 

 

For the nine months ended

 

Cash Flows From Operating Activities:

 

September 30,

2021

 

 

September 30,

2020

 

Net loss

 

$(97,579)

 

$(1,576,405)

Adjustments to reconcile net loss to net cash provided (used) by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

665,604

 

 

 

667,298

 

Loss on abandonment of mineral properties

 

 

 

 

 

 

318,502

 

Accretion of asset retirement obligation

 

 

5,197

 

 

 

6,118

 

Common stock payable for directors fees

 

 

84,375

 

 

 

89,858

 

Gain on settlement of Hillgrove advance

 

 

(113,422)

 

 

-

 

Gain on forgiveness of Cares Act debt

 

 

(443,400)

 

 

-

 

Other non-cash items

 

 

-

 

 

 

(661)

Change in:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(484,093)

 

 

62,399

 

Inventories

 

 

(83,743)

 

 

61,194

 

IVA receivable and other assets

 

 

(30,612)

 

 

10,119

 

Accounts payable

 

 

(624,028)

 

 

(252,183)

Accrued liabilities

 

 

(64,417)

 

 

25,769

 

Export tax assessment payable

 

 

(1,120,730)

 

 

-

 

Payables to related parties

 

 

(171,016)

 

 

21,405

 

Net cash used by operating activities

 

 

(2,477,864)

 

 

(566,587)

 

 

 

 

 

 

 

 

 

Cash Flows From Investing Activities:

 

 

 

 

 

 

 

 

Proceeds from redemption of certificates of deposit

 

 

210,184

 

 

 

-

 

Purchase of properties, plants and equipment

 

 

(616,479)

 

 

(220,455)

Net cash used by investing activities

 

 

(406,295)

 

 

(220,455)

 

 

 

 

 

 

 

 

 

Cash Flows From Financing Activities:

 

 

 

 

 

 

 

 

Change in checks issued and payable

 

 

(86,685)

 

 

(2,879)

Net proceeds from (payments to) factor

 

 

-

 

 

 

(5,032)

Payments on advances from related party

 

 

(56,416)

 

 

(64,650)

Proceeds from note payable-SBA

 

 

-

 

 

 

443,400

 

Proceeds from issuance of common stock, net of issuance costs

 

 

23,342,180

 

 

 

1,813,068

 

Proceeds from exercise of warrants

 

 

1,790,703

 

 

 

-

 

Payments on Hillgrove advances payable

 

 

(1,020,799)

 

 

-

 

Borrowing on notes payable to bank

 

 

-

 

 

 

(46,270)

Principal paid on notes payable to bank

 

 

(100,000)

 

 

-

 

Principal payments of long-term debt

 

 

(86,426)

 

 

(30,876)

Net cash provided by financing activities

 

 

23,782,557

 

 

 

2,106,761

 

NET INCREASE IN CASH AND CASH

 

 

 

 

 

 

 

 

          EQUIVALENTS AND RESTRICTED CASH

 

 

20,898,398

 

 

 

1,319,719

 

Cash and cash equivalents and restricted cash at beginning of period

 

 

722,377

 

 

 

172,767

 

Cash and cash equivalents and restricted cash at end of period

 

$21,620,775

 

 

$1,492,486

 

 

 

 

 

 

 

 

 

 

NON-CASH INVESTING AND FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Common stock payable issued to directors (Note 10)

 

$110,000

 

 

$130,483

 

Payable to related party satisfied with issuance of stock (Note 10)

 

$-

 

 

$62,500

 

 

The accompanying notes are an integral part of the condensed consolidated financial statements.

 

 
6

Table of Contents

   

PART I - FINANCIAL INFORMATION, CONTINUED:

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed 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‑Q. 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 and nine month periods ended September 30, 2021 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021.

 

For further information refer to the financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

 

Going Concern Consideration

 

At September 30, 2021, the Company’s condensed consolidated financial statements show working capital of approximately $21.2 million and an accumulated deficit of approximately $32.7 million. The Company has incurred losses for the past two fiscal years which are principally a result of the Company’s antimony operations due to both depressed antimony prices and production costs incurred in Mexico. To improve conditions, the Company continues searching for areas to reduce these production costs.

 

In the nine months of 2021, the Company raised net proceeds of approximately $23.3 million from sale of shares of its common stock and approximately $1.8 million from the exercise of stock purchase warrants. These funds have been and will continue to be used for general corporate purposes, working capital, hiring of additional labor, leverage for reducing legacy contracts, additional managerial staff at United States Antimony Corporation (“USAC”) and Bear River Zeolite (“BRZ”) headquarters, a revised website including measures aimed at increased visibility for advertising, more labor at its Mexican smelter, repair and improved infrastructure at the Mexican smelter, potential securement of additional antimony mine reserves in Mexico, and improvement of furnaces in Montana. With the funds raised, management believes the Company has sufficient funds to sustain its operations and meet its financial obligations during the twelve months following the date of issuance of these condensed consolidated financial statements.

 

 

  

2.

Developments in Accounting Pronouncements 

 

 

   

Accounting Standards Updates Adopted

 

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The update contains a number of provisions intended to simplify the accounting for income taxes. The update was adopted as of January 1, 2021, and its adoption did not have a material impact on the Company’s condensed consolidated financial statements.

  

 
7

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

 

2.

Developments in Accounting Pronouncements, Continued:

 

Accounting Standards Updates to Become Effective in Future Periods

 

In August 2020, the FASB issued ASU No.2019-12 Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The update is to address issues identified as a result of the complexity associated with applying generally accepted accounting principles for certain financial instruments with characteristics of liabilities and equity. The update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years and with early adoption permitted. Management is evaluating the impact of this update on the Company’s condensed consolidated financial statements.

 

Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the condensed consolidated financial statements upon adoption. 

 

3.  

Income (Loss) Per Common Share

 

 

 

Basic earnings per share is calculated by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated based on the weighted average number of common shares outstanding during the period plus the effect of potentially dilutive common stock equivalents, including stock options, warrants to purchase the Company’s common stock, and convertible preferred stock.

 

At September 30, 2021 and 2020, the potentially dilutive common stock equivalents not included in the calculation of diluted earnings per share as their effect would have been anti-dilutive are as follows:

 

 

 

September 30,

2021

 

 

September 30,

2020

 

Warrants

 

 

12,489,922

 

 

 

6,194,899

 

Convertible preferred stock

 

 

1,751,005

 

 

 

1,751,005

 

Total possible dilution

 

 

14,240,927

 

 

 

7,945,904

 

 

4.

Revenue Recognition

 

 

 

Products consist of the following:

  

 

·

Antimony: includes antimony oxide, sodium antimonate, antimony trisulfide, and antimony metal

 

·

Zeolite: includes coarse and fine zeolite crushed in various sizes

 

·

Precious Metals: includes unrefined and refined gold and silver

 

 
8

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

 

4.

Revenue Recognition, Continued:

 

 

 

Sales of products for the three and nine month periods ended September 30, 2021 and 2020 were as follows:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Antimony

 

$1,284,969

 

 

$477,273

 

 

$3,371,015

 

 

$2,509,183

 

Zeolite

 

 

693,008

 

 

 

481,126

 

 

 

1,929,383

 

 

 

1,653,201

 

Precious metals

 

 

73,736

 

 

 

48,832

 

 

 

280,164

 

 

 

173,029

 

 

 

$2,051,713

 

 

$1,007,231

 

 

$5,580,562

 

 

$4,335,413

 

 

The following is sales information by geographic area based on the location of customers for the three and nine month periods ended September 30, 2021 and 2020:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

United States

 

$1,805,456

 

 

$891,090

 

 

$4,954,412

 

 

$3,893,374

 

Canada

 

 

246,257

 

 

 

116,141

 

 

 

626,150

 

 

 

442,039

 

 

 

$2,051,713

 

 

$1,007,231

 

 

$5,580,562

 

 

$4,335,413

 

  

 

Sales of products to significant customers were as follows for the three and nine month periods ended September 30, 2021 and 2020:

 

 

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

Sales to

 

September 30,

 

 

September 30,

 

 

September 30,

 

 

September 30,

 

Largest Customers

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Company A

 

 

288,640

 

 

 

114,075

 

 

 

778,211

 

 

 

404,447

 

Company B

 

 

581,609

 

 

 

105,865

 

 

 

1,284,206

 

 

 

-

 

Company C

 

 

-

 

 

 

-

 

 

 

518,226

 

 

 

523,660

 

Company D

 

 

225,800

 

 

 

-

 

 

 

225,800

 

 

 

-

 

Company E

 

 

-

 

 

 

131,360

 

 

 

-

 

 

 

345,899

 

 

 

$1,096,049

 

 

$351,300

 

 

$2,806,443

 

 

$1,274,006

 

% of Total Revenues

 

 

53.42%

 

 

34.88%

 

 

50.29%

 

 

29.39%

 

At September 30, 2021, the Company had a sales order backlog of 1,192 tons of zeolite and 44,092 pounds of antimony.

 

 
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Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

 

4.

Revenue Recognition, Continued:

 

Accounts receivable from largest customers were as follows at September 30, 2021 and December 31, 2020:

 

Largest

 

 

 

 

 

 

Accounts Receivable

 

September 30,

2021

 

 

December 31,

2020

 

Company B

 

$222,100

 

 

$-

 

Company F

 

 

110,864

 

 

 

-

 

Company G

 

 

54,400

 

 

 

68,055

 

Company H

 

 

-

 

 

 

21,619

 

Company I

 

 

-

 

 

 

16,600

 

Company J

 

 

-

 

 

 

12,255

 

 

 

$387,364

 

 

$118,529

 

% of Total Receivables

 

 

53.60%

 

 

49.67%

  

 

Our trade accounts receivable balance related to contracts with customers was $722,727 at September 30, 2021 and $238,634 at December 31, 2020. Our products do not involve any warranty agreements and product returns are not typical.

 

5.

Inventories

 

 

 

Inventories at September 30, 2021 and December 31, 2020 consisted primarily of finished antimony products, antimony metal, antimony ore, and finished zeolite products that are stated at the lower of first-in, first-out cost or estimated net realizable value. Finished antimony products, antimony metal and finished zeolite products costs include raw materials, direct labor and processing facility overhead costs and freight. Inventories at September 30, 2021 and December 31, 2020 are as follows:

 

 

 

September 30,

2021

 

 

December 31,

2020

 

Antimony Metal

 

$116,325

 

 

$268,100

 

Antimony Oxide

 

 

214,659

 

 

 

67,377

 

Antimony Ore

 

 

211,788

 

 

 

95,880

 

Total antimony

 

 

542,772

 

 

 

431,357

 

Zeolite

 

 

191,184

 

 

 

218,856

 

 

 

$733,956

 

 

$650,213

 

 

 

Antimony oxide inventory consisted of finished product oxide held at the Company’s plants in Montana and Mexico. Antimony concentrates and ore were held primarily at sites in Mexico and are essentially raw material. The Company’s zeolite inventory consists of salable zeolite material.

 

As of September 30, 2021 and December 31, 2020, all inventory is valued at cost except for antimony ore inventory in Mexico which was valued at net realizable value as of December 31, 2020.

 

 
10

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

 

6.

Commitments and Contingencies

 

 

 

The Company pays various royalties on the sale of zeolite products. On a combined basis, royalties vary from 8%-13%. During the three and nine month periods ended September 30, 2021, the Company had royalty expense of $64,212 and $195,779, respectively. During the three and nine month periods ended September 30, 2020, the Company had royalty expense of $52,569 and $178,187, respectively. At September 30, 2021 and December 31, 2020, the Company had accrued royalties payable of $376,704 and $434,981, respectively, which is included in accrued liablities. The Company is currently in negotiations with certain royalty holders to modify the terms of the agreements. 

 

7.

Notes Payable to Bank

 

 

 

At September 30, 2021 and December 31, 2020, the Company had the following notes payable to bank:

 

 

 

2021

 

 

2020

 

Promissory note payable to First Security Bank of Missoula,

 

 

 

 

 

 

bearing interest at 3.150%, payable on demand, collateralized

 

 

 

 

 

 

by a lien on Certificate of Deposit

 

$-

 

 

$99,999

 

 

 

 

 

 

 

 

 

 

Promissory note payable to First Security Bank of Missoula,

 

 

 

 

 

 

 

 

bearing interest at 3.150%, payable on demand, collateralized

 

 

 

 

 

 

 

 

by a lien on Certificate of Deposit

 

 

-

 

 

 

1

 

 

 

 

 

 

 

 

 

 

Total notes payable to the bank

 

$-

 

 

$100,000

 

 

 

The notes are paid in full as of September 30, 2021 and the lien on the Certificate of Deposit has been released. An amount of $210,184 of the Certificate of Deposit was released during the nine months ended September 30, 2021 and the cash was transferred to the checking account, leaving a Certificate of Deposits balance of $44,028 at September 30, 2021 compared to $254,212 at December 31, 2020. 

 

 
11

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United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

8.

Debt

 

 

 

Long-Term debt at September 30, 2021 and December 31, 2020 is as follows:

 

 

 

September 30,

 

 

December 31,

 

 

 

2021

 

 

2020

 

Note payable to Zeo Inc., non interest bearing,

 

 

 

 

 

 

payable in 11 quarterly installments of $8,300 with a final payment of $8,700;

 

 

 

 

 

 

maturing December 2022; uncollateralized.

 

$-

 

 

$66,800

 

Note payable to Cat Financial Services, bearing interest at 6%;

 

 

 

 

 

 

 

 

payable in monthly installments of $778; maturing

 

 

 

 

 

 

 

 

December 2022; collateralized by equipment.

 

 

-

 

 

 

17,480

 

Note payable to Phyllis Rice, bearing interest

 

 

 

 

 

 

 

 

at 1%; payable in monthly installments of $2,000; originally maturing

 

 

 

 

 

 

 

 

March 2015; collateralized by equipment.

 

 

-

 

 

 

2,146

 

 

 

 

-

 

 

 

86,426

 

Less current portion

 

 

-

 

 

 

(52,122)

Long-term portion

 

$-

 

 

$34,304

 

 

9.

Related Party Transactions

 

 

 

The Company’s previous President and Chairman, John Lawrence, rented equipment to the Company and charged the Company for lodging and meals provided to consultants, customers and other parties by an entity that Mr. Lawrence owned. The amount due to Mr. Lawrence’s estate as of September 30, 2021 and December 31, 2020 was $nil and $171,017. During the nine months ended September 30, 2021, the Company paid off the full amount of $171,017 to John Lawrence’s estate for reimbursement of these expenses.

 

During 2019, Mr. Lawrence advanced funds to the Company that had a balance at December 31, 2020 of $56,215. During the nine month period ended September 30, 2021, the Company paid First Security Bank on behalf of Mr. Lawrence $56,215. The balance of the advances due to Mr. Lawrence at September 30, 2021 is $nil.

 

John C. Gustavsen, Interim CEO of the Company, has an advance due from the Company of $200 at December 31, 2020. During the nine month period ended September 30, 2021, the Company paid $200 to Mr. Gustavsen as reimbursement on these advances.

 

During the nine months ended September 30, 2021, Russ Lawrence, Interim President & Director, incurred expenses of $18,487 and charged the Company for lodging and meals provided to visiting Board of Directors by an entity that Russ Lawrence owns. During the nine month period ended September 30, 2021, the Company paid Russ Lawrence $17,740, leaving a balance due of $747 which is included in accounts payable on the balance sheet. 

 

 
12

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

10.

Stockholder’s Equity

 

 

 

In February 2021, the Company sold shares of its common stock in two separate transactions: On February 3, 2021, 15,300,000 shares were sold at $0.70 for gross proceeds of $10,710,000; and on February 18, 2021, 10,990,000 shares were sold at at $1.30 for gross proceeds of $14,287,000. A total of $1,654,820 of cash issuance costs were incurred on these sales.

 

During the nine months ended September 30, 2021, the Company accrued $84,375 in directors’ fees payable that will be paid in common stock.

 

During the nine months ended September 30, 2021, the Company issued 112,610 shares of common stock to the board of director’s to satisfy the directors’ fees payable of $110,000 that were outstanding at December 31, 2020.

 

During the nine month period ended September 30, 2021, the Company issued 3,765,477 shares of common stock and received $1,790,703 in cash from the exercise of warrants. For the same period in 2020, the Company’s former president, John Lawrence, exercised warrants for 250,000 shares of common stock in exchange for a payable due to him of $62,500.

 

Warrants

 

Concurrent with the February 3, 2021 sale of common stock, the Company sold warrants to purchase 7,650,000 shares of common stock at an exercise price of $0.85 per share. The warrants are initially exercisable six months following issuance and expire five and one-half years from the issuance date. In connection with the February 2021 sales of common stock, the Company also issued 1,606,500 warrants with an exercise price of $0.85 and 804,000 warrants with an exercise price of $0.46 as commission to the placement agent.

 

Transactions in common stock purchase warrants for the nine month period ended September 30, 2021 and the year ended December 31, 2020 are as follows:

 

 

 

Number of Warrants

 

 

Exercise Prices

 

Balance December 31, 2019

 

 

702,041

 

 

$

0.25 - $0.65

 

Issued

 

 

5,742,858

 

 

$0.46

 

Exercised

 

 

(250,000)

 

$0.25

 

Balance December 31, 2020

 

 

6,194,899

 

 

$

0.46 - $0.65

 

Issued

 

 

10,060,500

 

 

$

0.46- $0.85

 

Exercised

 

 

(3,765,477)

 

$

0.46 - $0.65

 

Balance September 30, 2021

 

 

12,489,922

 

 

$

0.46 - $0.85

 

 

 

These warrants expire as follows:

 

Warrants

 

 

Exercise Price

 

 

Expiration

Date

 

 

143,707

 

 

$0.65

 

 

2022

 

 

2,285,715

 

 

$0.46

 

 

2026

 

 

9,256,500

 

 

$0.85

 

 

2026

 

 

804,000

 

 

$0.46

 

 

2026

 

 

12,489,922

 

 

 

 

 

 

 

 

 

 
13

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

11.

Income and Other Taxes

 

 

 

Mexican Tax Assessment

 

In 2015, the Mexican tax authority (“SAT”) initiated an audit of the USAMSA’s 2013 income tax return. In October 2016, as a result of its audit, SAT assessed the Company $13.8 million pesos, which was approximately $666,400 in U.S. Dollars (“USD”) as of December 31, 2016. SAT’s assessment was based on the disallowance of specific costs that the Company deducted on the 2013 USAMSA income tax return. The Company engaged accountants and tax attorneys in Mexico to defend its position. The assessment was settled in 2018 with no assessment against the Company.

 

In early 2019, the Company was notified that SAT re-opened its audit of USAMSA’s 2013 income tax return and, in November 2019, SAT assessed the Company $16.3 million pesos, which was approximately $818,000 USD as of September 30, 2021. Management reviewed the 2019 assessment notice from SAT and, similar to the earlier assessment, believes the findings have no merit. The Company engaged a tax attorney in Mexico to defend its position. An appeal was filed by the Company in November 2019 suspending SAT from taking immediate action regarding the assessment. The Company posted a guarantee of the amount in March 2020 as is required under the appeal process. In August 2020, the Company filed a lawsuit against SAT for resolution of the process and, in December 2020, filed closing arguments. Management expects the appeal process to continue through 2021.

 

At September 30, 2021 and December 31, 2020, management assessed the possible outcomes for this tax audit and believes, based on discussions with its tax attorney in Mexico, that the most likely outcome will be that the Company will be successful in its appeal resulting in no tax due. Management determined that no amount should be accrued at September 30, 2021 and December 31, 2020 relating to this potential tax liability. There can be no assurance that the Company’s ultimate liability, if any, will not have a material adverse effect on the Company’s results of operations or financial position. If an issue addressed during the SAT audit is resolved in a manner inconsistent with management expectations, the Company will adjust its current net operating loss carryforward, or accrue penalties, interest, and tax associated with the assessment.

 

Other Taxes

 

In 2016, USAMSA imported coal from the United States to its smelter in Mexico to process Australian concentrates associated with the Hillgrove agreement (Note 12). At that time, the Company applied for and was granted a Maquiladora (IMMEX), in accordance with a Manufacturing and Export Services Industry program offered by the Mexican government to attract and promote foreign investment in Mexico. With the IMMEX, all imported goods to Mexico that are also exported in altered form are exempt from the requirement of paying the 16% tax (IVA). The Company did not pay IVA on any of the imported coal used to process the Australian concentrates. In 2020, the Company was informed by the SAT that it owed the 16% IVA money for all the coal imported for the processing of the Australian concentrates. Additionally, there were penalties and fees that SAT added to the total amount. In late 2020, the Company filed a motion before the Taxpayer’s Defense Agency (PRODECON), but the motion was denied. To avoid exorbitant penalties, the Company elected to pay the assessed amount in early 2021. For the year ended December 31, 2020, the Company recognized an export tax expense of $1,120,730 and accrued a liability for this assessment. The assessment was settled with a payment of $1,120,730 during the three month period ended March 31, 2021.

 

 
14

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

12.

Hillgrove Advances Payable

 

 

 

On November 7, 2014, the Company entered into an advance and concentrate processing agreement with Hillgrove Mines Pty Ltd of Australia (Hillgrove) in which the Company was advanced funds from Hillgrove to build facilities to process Hillgrove antimony concentrate. The Company has not processed Hillgrove concentrate for more than two years. The agreement requires the Company to pay the advance balance after Hillgrove issues a stop notice. Payments would begin 90 days after the stop notice issue date and be made in six equal and quarterly installments. Hillgrove was acquired by Red River Resources LTD (“Red River”) during 2019. The balance of the advance liability due was $1,134,221 at December 31, 2020. In April 2021, the Company successfully negotiated a settlement with Red River for an agreed upon amount of $1,020,799 which was paid on paid on April 8, 2021. The Company recognized a gain on settlement of the advance in the amount of $113,422 during the three month period ended June 30, 2021. 

 

13.

Business Segments

 

 

 

The Company is currently organized and managed by four segments, which represent our operating units: United States antimony operations, Mexican antimony operations, precious metals recovery and United States zeolite operations.

 

The Puerto Blanco mill and the Madero smelter at the Company’s Mexico operation bring antimony up to an intermediate or finished stage, which may be sold directly or shipped to the United States operation for finishing at the Thompson Falls, Montana plant. The Puerto Blanco mill in Mexico is the site of our crushing and flotation plant, and a cyanide leach plant which will recover precious metals after the ore goes through the crushing and flotation cycles. A precious metals recovery plant is operated in conjunction with the antimony processing plant at Thompson Falls, Montana, where a 99% precious metals mix will be produced. The zeolite operation produces zeolite near Preston, Idaho. Almost all of the sales of products from the United States antimony and zeolite operations are to customers in the United States, although the Company does have a sales operation in Canada.

 

Segment disclosure regarding sales to major customers is located in Note 4.

 

Properties, plants

and equipment, net:

 

September 30,

2021

 

 

December 31,

2020

 

Antimony

 

 

 

 

 

 

United States

 

$1,617,981

 

 

$1,637,738

 

Mexico

 

 

7,215,048

 

 

 

7,635,410

 

Subtotal Antimony

 

 

8,833,029

 

 

 

9,273,148

 

Precious metals

 

 

904,647

 

 

 

933,885

 

Zeolite

 

 

1,438,791

 

 

 

1,018,561

 

Total

 

$11,176,469

 

 

$11,225,594

 

 

At September 30, 2021 and December 31, 2020, the Company had $807,471 and $755,978, respectively, of assets that were not yet placed in service and have not yet been depreciated.\

 

 
15

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

13.

Business Segments, Continued:

 

 

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

Capital expenditures:

 

September 30,

2021

 

 

September 30,

2020

 

 

September 30,

2021

 

 

September 30,

2020

 

Antimony

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$4,060

 

 

$-

 

 

$4,060

 

 

$32,448

 

Mexico

 

 

4,872

 

 

 

2,923

 

 

 

14,616

 

 

 

33,585

 

Subtotal Antimony

 

 

8,932

 

 

 

2,923

 

 

 

18,676

 

 

 

66,033

 

Precious Metals

 

 

17,607

 

 

 

17,366

 

 

 

54,954

 

 

 

138,211

 

Zeolite

 

 

474,812

 

 

 

-

 

 

 

542,849

 

 

 

16,211

 

Total

 

$501,351

 

 

$20,289

 

 

$616,479

 

 

$220,455

 

 

Segment Operations for the three

 

Antimony

 

 

Antimony

 

 

Total

 

 

Precious

 

 

Bear River

 

 

 

 

months ended September 30, 2021

 

USAC

 

 

Mexico

 

 

Antimony

 

 

Metals

 

 

Zeolite

 

 

Totals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$1,284,969

 

 

$-

 

 

$1,284,969

 

 

$73,736

 

 

$693,008

 

 

$2,051,713

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

8,032

 

 

 

145,027

 

 

 

153,059

 

 

 

28,361

 

 

 

41,776

 

 

 

223,196

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

528,750

 

 

 

(673,739)

 

 

(144,989)

 

 

45,375

 

 

 

(12,348)

 

 

(111,962)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

13,249

 

 

 

-

 

 

 

13,249

 

 

 

-

 

 

 

(519)

 

 

12,730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$541,999

 

 

$(673,739)

 

$(131,740)

 

$45,375

 

 

$(12,867)

 

$(99,232)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operations for the three

 

Antimony

 

 

Antimony

 

 

Total

 

 

Precious

 

 

Bear River

 

 

 

 

 

months ended September 30, 2020

 

USAC

 

 

Mexico

 

 

Antimony

 

 

Metals

 

 

Zeolite

 

 

Totals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$477,273

 

 

$-

 

 

$477,273

 

 

$48,832

 

 

$481,126

 

 

$1,007,231

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

7,395

 

 

 

146,099

 

 

 

153,494

 

 

 

22,141

 

 

 

42,015

 

 

 

217,650

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

(208,676)

 

 

(904,337)

 

 

(1,113,013)

 

 

26,691

 

 

 

96,813

 

 

 

(989,509)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

(2,883)

 

 

(4)

 

 

(2,887)

 

 

-

 

 

 

(844)

 

 

(3,731)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$(211,559)

 

$(904,341)

 

$(1,115,900)

 

$26,691

 

 

$95,969

 

 

$(993,240)

 

 
16

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

13.

Business Segments, Continued:

 

Segment Operations for the nine

 

Antimony

 

 

Antimony

 

 

Total

 

 

Precious

 

 

Bear River

 

 

 

 

months ended September 30, 2021

 

USAC

 

 

Mexico

 

 

Antimony

 

 

Metals

 

 

Zeolite

 

 

Totals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$3,371,015

 

 

$-

 

 

$3,371,015

 

 

$280,164

 

 

$1,929,383

 

 

$5,580,562

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

23,816

 

 

 

434,978

 

 

 

458,794

 

 

 

84,191

 

 

 

122,619

 

 

 

665,604

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

409,723

 

 

 

(1,487,670)

 

 

(1,077,947)

 

 

195,973

 

 

 

196,096

 

 

 

(685,878)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

476,609

 

 

 

113,422

 

 

 

590,031

 

 

 

-

 

 

 

(1,732)

 

 

588,299

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$886,332

 

 

$(1,374,248)

 

$(487,916)

 

$195,973

 

 

$194,364

 

 

$(97,579)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Operations for the nine

 

Antimony

 

 

Antimony

 

 

Total

 

 

Precious

 

 

Bear River

 

 

 

 

 

months ended September 30, 2020

 

USAC

 

 

Mexico

 

 

Antimony

 

 

Metals

 

 

Zeolite

 

 

Totals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$2,509,183

 

 

$-

 

 

$2,509,183

 

 

$173,029

 

 

$1,653,201

 

 

$4,335,413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

22,184

 

 

 

438,297

 

 

 

460,481

 

 

 

66,422

 

 

 

140,395

 

 

 

667,298

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

156,884

 

 

 

(2,182,979)

 

 

(2,026,095)

 

 

106,607

 

 

 

347,166

 

 

 

(1,572,322)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

(1,058)

 

 

(4)

 

 

(1,062)

 

 

-

 

 

 

(3,021)

 

 

(4,083)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$155,826

 

 

$(2,182,983)

 

$(2,027,157)

 

$106,607

 

 

$344,145

 

 

$(1,576,405)

 

 
17

Table of Contents

 

United States Antimony Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited), Continued:

 

14.

Note Payable-Small Business Administration Loan

 

 

 

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (the “CARES Act”) Act was signed into United States law.

 

On April 20, 2020, the Company received a loan of $443,400 pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The loan, which was in the form of a Note dated April 20, 2020 had a maturity date on April 19, 2022 and an interest rate of 1% per annum. The loan was to be forgiven under the provisions of the CARES Act if the Company used the funds for qualifying expenses. Qualifying expenses included payroll costs, costs used to continue group health care benefits, rent, and utilities. During the three month period ended June 30, 2021, the Company received notification that the loan had been forgiven. The amount of the loan, $443,400, was recognized as gain on forgiveness of the CARES Act loan. 

 

 
18

Table of Contents

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition

 

COVID-19 Coronavirus Pandemic Response and Impact

 

One of the principal challenges facing the Company in 2021 as a result of stimulus funding from Covid-19 has been the evaporation of available labor. This issue has seriously impacted both operations in Montana and at its zeolite operation in Idaho. The following measures are being taken in an attempt to obtain and retain laborers:

 

 

1.

The Company has raised the starting wage both in Montana and Idaho and as a result increased its labor costs for existing laborers.

 

2.

The Company has advertised on multiple job search platforms and is also advertising in two languages on conventional job search platforms as well as on multiple social media sites.

 

3.

The Company is increasing capacity at the Mexican smelter where labor is not a problem.

 

4.

The Company is investigating hiring from alternative potential labor pools.

 

It is difficult to hire people if they are getting paid more not to work, which is the reality in many cases but is hopeful that the situation(s) fueling this crisis will end soon.

 

General

 

Certain matters discussed are forward-looking statements that involve risks and uncertainties, including the impact of antimony prices and production volatility, changing market conditions and the regulatory environment and other risks. Actual results may differ materially from those projected. These forward-looking statements represent our judgment as of the date of this filing. We disclaim, however, any intent or obligation to update these forward-looking statements.

 

 
19

Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition, continued:

 

 

 

Three Months

 

 

Three Months

 

 

Nine Months

 

 

Nine Months

 

 

 

Ended

 

 

Ended

 

 

Ended

 

 

Ended

 

Antimony - Combined USA and Mexico

 

September 30,

2021

 

 

September 30,

2020

 

 

September 30,

2021

 

 

September 30,

2020

 

Lbs of Antimony Metal USA

 

 

306,045

 

 

 

89,052

 

 

 

817,131

 

 

 

375,519

 

Lbs of Antimony Metal Mexico:

 

 

-

 

 

 

57,790

 

 

 

10,000

 

 

 

300,474

 

Total Lbs of Antimony Metal Sold

 

 

306,045

 

 

 

146,842

 

 

 

827,131

 

 

 

675,993

 

Average Sales Price/Lb Metal

 

$4.20

 

 

$3.25

 

 

$4.08

 

 

$3.71

 

Net loss/Lb Metal

 

$(0.43)

 

$(7.60)

 

$(0.59)

 

$(3.00)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross antimony revenue - net of discount

 

 

1,284,969

 

 

 

477,273

 

 

 

3,371,015

 

 

 

2,509,183

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales - domestic

 

 

(585,875)

 

 

(491,092)

 

 

(2,080,987)

 

 

(1,559,018)

Cost of sales - Mexico

 

 

(654,380)

 

 

(557,399)

 

 

(1,220,069)

 

 

(1,805,127)

Operating expenses

 

 

(189,703)

 

 

(223,293)

 

 

(1,147,906)

 

 

(852,631)

Non-operating income (expenses)

 

 

13,249

 

 

 

(2,887)

 

 

590,031

 

 

 

(1,062)

Loss on abandonment of mineral properties

 

 

-

 

 

 

(318,502)

 

 

-

 

 

 

(318,502)

 

 

 

(1,416,709)

 

 

(1,593,173)

 

 

(3,858,931)

 

 

(4,536,340)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss - antimony

 

 

(131,740)

 

 

(1,115,900)

 

 

(487,916)

 

 

(2,027,157)

Depreciation,& amortization

 

 

153,059

 

 

 

153,494

 

 

 

458,794

 

 

 

460,181

 

EBITDA - antimony

 

$21,319

 

 

$(962,406)

 

$(29,122)

 

$(1,566,976)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Precious Metals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ounces sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gold

 

 

12

 

 

 

6

 

 

 

34

 

 

 

31

 

Silver

 

 

5,638

 

 

 

2,403

 

 

 

15,246

 

 

 

11,434

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross precious metals revenue

 

$73,736

 

 

$48,832

 

 

$280,164

 

 

$173,029

 

Cost of sales

 

 

(28,361)

 

 

(22,141)

 

 

(84,191)

 

 

(66,422)

Net income - precious metals

 

 

45,375

 

 

 

26,691

 

 

 

195,973

 

 

 

106,607

 

Depreciation

 

 

28,361

 

 

 

22,141

 

 

 

84,191

 

 

 

66,422

 

EBITDA - precious metals

 

$73,736

 

 

$48,832

 

 

$280,164

 

 

$173,029

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Zeolite

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tons sold

 

 

3,045

 

 

 

2,500

 

 

 

8,823

 

 

 

8,354

 

Average Sales Price/Ton

 

$227.59

 

 

$192.45

 

 

$218.68

 

 

$197.89

 

Net income (Loss)/Ton

 

$(4.23)

 

$38.39

 

 

$22.03

 

 

$41.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross zeolite revenue

 

$693,008

 

 

$481,126

 

 

$1,929,383

 

 

$1,653,201

 

Cost of sales

 

 

(681,888)

 

 

(371,690)

 

 

(1,685,551)

 

 

(1,254,821)

Operating expenses

 

 

(23,468)

 

 

(12,623)

 

 

(47,736)

 

 

(51,214)

Non-operating expenses

 

 

(519)

 

 

(844)

 

 

(1,732)

 

 

(3,021)

Net income (loss) - zeolite

 

 

(12,867)

 

 

95,969

 

 

 

194,364

 

 

 

344,145

 

Depreciation

 

 

41,776

 

 

 

42,015

 

 

 

122,619

 

 

 

140,395

 

EBITDA - zeolite

 

$28,909

 

 

$137,984

 

 

$316,983

 

 

$484,540

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Company-wide

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross revenue

 

$2,051,713

 

 

$1,007,231

 

 

$5,580,562

 

 

$4,335,413

 

Production costs

 

 

(1,950,504)

 

 

(1,442,322)

 

 

(5,070,798)

 

 

(4,685,388)

Operating expenses

 

 

(213,171)

 

 

(235,916)

 

 

(1,195,642)

 

 

(903,845)

Non-operating income (expenses)

 

 

12,730

 

 

 

(3,731)

 

 

588,299

 

 

 

(4,083)

Loss on abandonment of mineral properties

 

 

-

 

 

 

(318,502)

 

 

-

 

 

 

(318,502)

Net loss

 

 

(99,232)

 

 

(993,240)

 

 

(97,579)

 

 

(1,576,405)

Depreciation,& amortization

 

 

223,196

 

 

 

217,650

 

 

 

665,604

 

 

 

667,298

 

EBITDA

 

$123,964

 

 

$(775,590)

 

$568,025

 

 

$(909,107)

 

Certain amounts shown in this table may not add exactly to total amounts due to rounding differences

 

 
20

Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition, continued:

 

Company-Wide

 

For the third quarter of 2021, we recognized a net loss of $99,232 on sales of $2,051,713 and other income and expense of $12,730 after depreciation and amortization of $223,196. We reported a net loss of $993,240 in the third quarter of 2020 on sales of $1,007,231, after depreciation and amortization of $217,650.

 

For the first nine months of 2021, we recognized a net loss of $97,579 on sales of $5,580,562 and other income and expense of $588,299, after depreciation and amortization of $665,604. We reported a net loss of $1,576,405 for the first nine months of 2020 on sales of $4,335,413, after depreciation and amortization of $667,298.

 

For the three and nine months ended September 30, 2021, EBITDA was a positive $123,964 and $568,025 compared to a negative $775,590 and $909,107 for the same periods in 2020.

 

For the three and nine months ended September 30, 2021, general and administrative expenses were $112,744 and $572,905 compared to $110,051 and $429,973 for the same periods of 2020.

 

Antimony

 

Antimony has been the focus of the Company since its inception. China, historically the sole supplier of lump antimony trisulfide and the dominate supplier of antimony in general, has held back the export of all antimony products leading to a marked increase in price in 2021.

 

The Madero crew continued to produce crude antimony oxide and some of this production was simultaneously diverted to crude metal. While the price is high the Company has decided to convert some of its crude oxide to finished metal. This move will eliminate shipping charges for the finished metal as the product will be shipped directly to the customer.

 

Two new furnaces in Thompson Falls are fully operational and started producing test batches of antimony trisulphide in early October. Throughput nameplate capacity of antimony trisulphide will increase from 100 lbs per day to approximately 1100 lbs per day. A second sample of antimony trisulfide lump has been prepared and sent for grinding and laboratory analysis. If the quality meets specifications, the second sample will be sent to the Picatinny Arsenal of the U. S. Department of Defense.

 

The Company continues to track developments at Ambri, Inc. which has purchased the Company’s antimony metal during the year and may be a significant customer in the future.

 

For the three and nine month periods ended September 30, 2021, we sold 306,045 pounds and 827,131 pounds of antimony compared to 146,842 and 675,993 pounds for the three and nine month periods ended September 30, 2020. The raw material received from our North American supplier increased by approximately 64,077 and 238,195 pounds for the three and nine month periods ended September 30, 2021, compared to the same periods for 2020. We had an increase in raw material from Mexico of approximately 87,223 pounds for the three month period and a decrease of 86 pounds for the nine month period ended September 30, 2021, compared to the same periods for 2020.

 

 
21

Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition, continued:

 

The average sales price of antimony during the three and nine month periods ended September 30, 2021 was $4.20 and $4.08 per pound compared to $3.25 and $3.71 during the same periods in 2020.

 

Precious Metals

 

Discussions have been initiated with Canadian and American gold and silver exploration companies, presently operating in Mexico, with a view towards a joint venture option agreement. A potential joint venture would ideally have existing personnel with experience in exploration for gold and silver in Mexico and would initially fund and manage the initial exploration programs as part of their earn-in requirement. Traditionally summer is a slow time for junior exploration companies and progress on negotiations has been slower than expected.

 

For the three and nine month periods ended September 30, 2021, revenue for precious metals from North American sources was $73,736 and $280,164 compared to $48,832 and $173,029 for the same periods of 2020.

 

Current and prior periods’ revenue from precious metals is as follows:

 

Precious Metal Sales
Silver/Gold

 

For the three months ended

September 30,

 

 

For the nine months ended

September 30,

 

Montana

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Ounces Gold Shipped (Au)

 

 

12

 

 

 

6

 

 

 

34

 

 

 

31

 

Ounces Silver Shipped (Ag)

 

 

5,638

 

 

 

2,403

 

 

 

15,246

 

 

 

11,434

 

 Total Revenues

 

$73,736

 

 

$48,832

 

 

$280,164

 

 

$173,029

 

 

Bear River Zeolite (BRZ)

 

On August 12, 2021 the bearings went out on the primary jaw crusher, essentially shutting down production. The Company was able to source and purchase a refurbished jaw crusher, which shortened the down time that would have been required for repairs and dovetailed with the continuing program to upgrade the efficiency and reliability of the zeolite plant. Installation of the new jaw crusher was completed and online by September 3, 2021. Pit production test work utilizing a D-9 dozer to rip the in-situ zeolite instead of drilling and blasting continues. New uses and increased awareness of several of the recognized uses of zeolite are becoming known to the public. This is especially apparent in the advanced treatment requirements for mine discharge water and in the removal of naturally occurring radioactive isotopes in otherwise potable drinking water sources.

 

For the three and nine month periods ended September 30, 2021, BRZ sold 3,045 and 8,823 tons of zeolite compared to 2,500 and 8,354 tons in the same periods of 2020.

 

For the three and nine month periods ended September 30, 2021, BRZ realized a net loss of $12,867 and income of $194,364 after depreciation of $41,776 and $122,619 compared to a net income of $95,969 and $344,145 after depreciation of $42,015 and $140,395 for the same period of 2020.

 

BRZ realized an EBITDA for the three and nine month periods ended September 30, 2021 of $28,909 and $316,983 compared to $137,984 and $484,540 for the same periods in 2020.

 

 
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Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition, continued:

 

Financial Position

 

Financial Condition and Liquidity

 

September 30,

2021

 

 

December 31,

2020

 

 

 

 

 

 

 

 

Current assets

 

$23,064,211

 

 

$1,808,161

 

Current liabilities

 

 

(1,824,055)

 

 

(4,477,543)

Net Working Capital

 

$21,240,156

 

 

$(2,669,382)

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended 

 

 

 

September 30,

2021

 

 

September 30,

2020

 

Cash used by operations

 

$(2,477,864)

 

$(566,587)

Cash provided (used) by investing:

 

 

 

 

 

 

 

 

Cash used for capital outlay

 

 

(616,479)

 

 

(220,455)

Proceeds from redemption of certificates of deposit

 

 

210,184

 

 

 

-

 

Cash provided (used) by financing:

 

 

 

 

 

 

 

 

Net payments (to) from factor

 

 

 

 

 

 

(5,032)

Payments on notes payable to bank

 

 

(100,000)

 

 

(46,270)

Payments on Hillgrove advances payable

 

 

(1,020,799)

 

 

-

 

Proceeds from common stock issued, net

 

 

23,342,180

 

 

 

1,813,068

 

Proceeds from exercise of warrants

 

 

1,790,703

 

 

 

-

 

Principal paid on long-term debt

 

 

(86,426)

 

 

(30,876)

Payments on advances from related party

 

 

(56,416)

 

 

(64,650)

Proceeds from note payable-SBA

 

 

-

 

 

 

443,400

 

Change in checks issued and payable

 

 

(86,685)

 

 

(2,879)

Net change in cash, cash equivalents and restricted cash

 

$20,898,398

 

 

$1,319,719

 

 

Our net working capital increased by $23,909,538 from December 31, 2020 to September 30, 2021. Our cash and cash equivalents increased by $20,898,398 during the same period. We spent $616,479 for capital items, our debt decreased by $1,901,479 including $1,020,799 paid to Hillgrove, and our accounts payable and other accrued liabilities decreased by $1,895,860 including $1,120,730 paid for an export tax assessment. During the first nine months of 2021, we raised approximately $23.3 million from sale of shares of common stock and approximately $1.8 million for the exercise of warrants.

 

We have estimated commitments and improvements of less than $100,000 to finish building and installing the precious metals leach circuits. However, this funding will be implemented after its geological study of the Los Juarez property. The Company plans to conduct a proper study of the Los Juarez property and its tailings at its flotation plant and pending the results of these studies decide how to proceed regarding a drill program and/or mining of the property. The study may involve a partnership with a junior mining Company in order to assist US Antimony in the proper characterization of the deposit. Should the deposit be of great value, the Company will likely move the flotation plant closer to the mine. We believe that with our current cash balance, along with the future cash flow from operations and operating agreements, we have adequate liquid assets to meet these commitments and service our debt for the next twelve months.

 

 
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Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition, continued:

 

At September 30, 2021, the Company’s condensed consolidated financial statements show working capital of approximately $21.2 million and an accumulated deficit of approximately $32.7 million. The Company continues to search for areas to reduce production costs, and expects improvement in cash flow for the remainder of the year from the sale of antimony and zeolite along with the increased price of antimony as the price of antimony has been increasing during the past nine months.

 

In the first half of 2021, the Company raised net proceeds of approximately $23.3 million from sale of shares of its common stock and approximately $1.8 million from the exercise of stock purchase warrants. These funds have been and will continue to be used for general corporate purposes, working capital, hiring of additional labor, leverage for reducing legacy contracts, a geochemical, geological, and geophysical study of the Los Juarez property, additional managerial staff at USAC and BRZ headquarters, a revised website including measures aimed at increased visibility for advertising, more labor at its Mexican smelter, repair and improved infrastructure at the Mexican smelter, potential securement of additional antimony mine reserves in Mexico, and improvement of furnaces in Montana. With the funds raised, management believes the Company has sufficient funds to sustain its operations and meet its financial obligations during the 12 months following the date of issuance of these condensed consolidated financial statements.

 

ITEM 3.

 

None

 

ITEM 4. Controls and Procedures

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, as appropriate, to allow timely decisions regarding required disclosure. Our Interim President & Director conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of September 30, 2021. It was determined that there were material weaknesses affecting our disclosure controls and procedures and, as a result of those weaknesses, our disclosure controls and procedures were not effective as of September 30, 2021. These material weaknesses are as follows:

 

 

·

Inadequate design of internal control over the preparation of the financial statements and financial reporting processes;

 

·

Inadequate monitoring of internal controls over significant accounts and processes including controls associated with domestic and Mexican subsidiary operations and the period-end financial reporting process; and

 

·

The absence of proper segregation of duties within significant processes and ineffective controls over management oversight, including antifraud programs and controls.

 

We are aware of these material weaknesses and will develop procedures to ensure that independent review of material transactions is performed. The Interim President & Director will develop internal control measures to mitigate the lack of inadequate documentation of controls and the monitoring of internal controls over significant accounts and processes including controls associated with the period-ending reporting processes,

 

 
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Table of Contents

 

PART I - FINANCIAL INFORMATION, CONTINUED:

 

ITEM 4. Controls and Procedures, continued:

 

and to mitigate the segregation of duties within significant accounts and processes and the absence of controls over management oversight, including antifraud programs and controls.

 

We plan to consult with independent experts when complex transactions are entered into.

 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

There were no significant changes made to internal controls over financial reporting for the quarter ended September 30, 2021.

 

 
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Table of Contents

 

PART II - OTHER INFORMATION

 

Item 1. LEGAL PROCEEDINGS

 

None

 

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None

 

Item 3. DEFAULTS UPON SENIOR SECURITIES

 

The registrant has no outstanding senior securities.

 

Item 4. MINE SAFETY DISCLOSURES

 

The information concerning mine safety violations or other regulatory matters required by Section 1503 (a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 to this Annual Report.

 

Item 5. OTHER INFORMATION

 

None

 

 
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Table of Contents

 

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

 

Certifications

 

Certifications Pursuant to the Sarbanes-Oxley Act

 

Reports on Form 8-K  

 

None

 

 
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Table of Contents

  

SIGNATURES

 

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. Gustavsen

 

Date: November 15, 2021
John C. Gustavsen, Interim CEO

(Principal Executive)

 

 

 

 

 

By:

/s/ Russell Lawrence

 

Date: November 15, 2021

Russell C. Lawrence, Interim President & Director

 

 

 

 
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