Edgar Filing: UNITED STATES ANTIMONY CORP

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

FORM 10-KSB\A

(Mark One)

[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the fiscal year ended December 31, 2000

[ ] 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
(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code: (406) 827-3523

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par
value $.01 per share

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
---- ----

Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B contained in this form and no disclosure will be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

The registrant's revenues for its most recent fiscal year were $5,016,661.

The aggregate market value of the voting stock held by non-affiliates of the
registrant, based on the average bid price of such stock, was $3,167,632 as of
March 30, 2001.

At March 30, 2001, the registrant had 18,585,564 outstanding shares of par
value $.01 common stock.

TABLE OF CONTENTS

PART I

ITEM 1. DESCRIPTION OF BUSINESS 1
General 1
Summary 1
Antimony Division 1
Gold Division 2
Zeolite Divistion 2
Environmental Matters 2
Marketing 4
Antimony Price Fluctuations 4
Other 5
Employees 5

ITEM 2. DESCRIPTION OF PROPERTIES 5
Antimony Division 5
Gold Division 5
Zeolite 6

ITEM 3. LEGAL PROCEEDINGS 6

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 6

PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS 7

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATIONS 7

ITEM 7. FINANCIAL STATEMENTS 10

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE 10

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS, COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
ACT 10

ITEM 10.EXECUTIVE COMPENSATION 12

ITEM 11.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT 13

ITEM 12.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 14

ITEM 13.EXHIBITS AND REPORTS ON FORM 8-K 15

SIGNATURES 18

FINANCIAL STATEMENTS F1-F27

PART I

Item 1. Description of Business

General

Section 21E of the Securities Exchange Act of 1934 provides a "safe harbor"
for forward-looking statements. Certain information included herein contains
statements regarding management's expectations about future production and
development activities as well as other capital spending, financing sources
and effects of regulation. Such forward-looking information involves
important risks and uncertainties that could significantly affect anticipated
results in the future and, accordingly, such results may differ from those
expressed in any forward-looking statements made herein. These risks and
uncertainties include, but are not limited to, those relating to the market
price of metals, production rates, production costs, availability of continued
financing, and the Company's ability to remain a going concern. The Company
cautions readers not to place undue reliance on any forward-looking
statements, and such statements speak only as of the date made.

Summary

AGAU Mines, Inc., predecessor of United States Antimony Corporation, was
incorporated in June 1968 as a Delaware corporation to explore, develop and
mine gold and silver properties. United States Antimony Corporation ("USAC" or
"the Company") was incorporated in Montana in January 1970 to mine and produce
antimony products. In June 1973, AGAU Mines, Inc. was merged with and into
USAC, with USAC the surviving corporation in the merger. In December 1983,
USAC suspended its antimony mining operations when it became possible to
purchase antimony raw materials more economically from foreign sources. The
principal business of USAC has been the production of antimony products and
the mining and milling of gold.

USAC has been able to sustain its operations through gross profit produced
from its antimony operations, common stock sales, and financing from banks and
other sources. There can be no assurance, however, that USAC will be able to
continue to meet its obligations and continue in existence as a going concern
(see Note 1 to the Financial Statements).

Antimony Division

USAC's antimony mining properties, mill and metallurgical plant are located in
the Burns Mining District of Sanders County, Montana, approximately 15 miles
west of Thompson Falls. USAC holds 12 patented lode claims, some of which are
contiguous, and 2 patented mill sites.

Prior to 1984, USAC mined antimony ore underground by driving drifts and using
slushers in room and pillar type stopes. Mining was suspended in December
1983, because antimony could be purchased more economically from foreign
sources. USAC's underground antimony mining operations may be reopened in the
future should raw material prices warrant doing so. USAC now purchases the
majority of its raw antimony from China (approximately 70%) and, to a lesser
degree, Canada (approximately 15%). Antimony metal from Chinese sources has
been obtained primarily through a broker. Significant increases in world
antimony metal prices have necessitated renegotiation of USAC's supply
contract with the broker in order to assure continued availability of metal,
resulting in higher raw material costs. However, the increase in world prices
has enabled USAC to increase the prices of its antimony products and to
increase its gross profits. In addition, USAC is covering its customer supply
contract requirements by obtaining antimony metal from other foreign and
domestic sources.

The Company is dependent on foreign sources for raw materials and there are
risks of interruption in procurement from these sources and/or volatile
changes in world market prices for these materials that are not controllable
by USAC. USAC obtains antimony metal, the raw material for antimony products,
primarily (70%) from China. Changes in antimony metal export policy by the
Chinese government could impair availability of antimony metal and/or could
increase antimony metal prices, which could result in curtailed production,
decreased profits, operating result fluctuations or breach of contractual
obligations to provide antimony products to our customers. USAC currently owns
50% of the common stock of United States Antimony, Mexico S.A. de C.V.
("USAMSA"), which was formed in April 1998. During 1998 and 1999, USAC
invested capital and surplus equipment from its Thompson Falls antimony
operation in USAMSA, which is being used for the construction of an antimony
processing plant in Mexico.

To date, two antimony processing furnaces and a warehouse building have been
built and limited antimony processing has taken place. USAMSA is pursuing the
assignment of mining concessions in the Mexican states of Zacatecas, Coahuila,
Sonora, Queretaro and Oaxaca. USAMSA is expected in future years to produce
antimony metal and other products, utilizing its processing facilities as
processing opportunities become available and as antimony prices dictate.
These products would then be sent to USAC's plant near Thompson Falls, Montana
for further processing.

From refined antimony metal, USAC produces four antimony oxide products of
different particle size using proprietary furnace technology, several grades
of sodium antimonate using hydro metallurgical techniques, and specialty
antimony compounds. Antimony oxide is a fine, white powder that is used
primarily in conjunction with a halogen to form a synergistic flame retardant
system for plastics, rubber, fiberglass, textile goods, paints, coatings and
paper. Antimony oxide is also used as a color fastener in paint, as a
catalyst for production of polyester resins for fibers and film, as a
phosphorescent agent in fluorescent light bulbs and as a stabilizer for fluid
lubricants. Sodium antimonate is primarily used as a fining agent (degasser)
for glass in cathode ray tubes used in computer monitors and color television
bulbs and as a flame retardant. USAC also sells antimony metal for use in
bearings, storage batteries and ordnance.

USAC estimates that its present share of the domestic market for antimony
oxide products is approximately 10% to 12%. USAC has had three principal
domestic competitors. The balance of domestic sales are foreign imports
(primarily from Chinese and Belgian suppliers).

Gold Division

Yankee Fork Mining District. Until 1989, USAC mined and milled gold and
silver in the Yankee Fork Mining District in Custer County, Idaho. The site
is currently undergoing environmental remediation pursuant to an Idaho
Department of Environmental Quality consent decree. See "Environmental
Matters."

Yellow Jacket Mining District. During the years from 1991 to 1996 USAC mined,
milled and sold gold bullion produced from the Yellow Jacket mine. In 1996,
production at the Yellow Jacket was suspended due to recurring operating
losses and declines in precious metal prices. In 1999, the company abandoned
its leasehold interests and began environmental remediation activity at Yellow
Jacket (see "Environmental Matters") and began reclamation of the Yellow
Jacket tailings ponds and pit area.

Zeolite Division

USAC owns 75% of Bear River Zeolite Company ("BRZ"), an Idaho corporation
incorporated on June 1, 2000. BRZ has entered into a ten-year mining lease
with Webster Farm, L.L.C. The lease entitles BRZ to surface mine and process
zeolite on property located in Preston, Idaho in exchange for a royalty
payment. The royalty is a percentage of the unprocessed ore sale price which
varies between 5%-7%. The minimum annual royalty during the first five years
is $1,000. The royalty is also payable on zeolite mined on adjacent Bureau of
Land Management ("BLM"), ground on which BRZ has located five additional BLM
claims, if BRZ accesses those claims across the leased property. BRZ is
currently constructing a processing plant on the property. Mining and
processing equipment will be leased to BRZ by USAC; and USAC will advance
development and start-up costs. Production and sale of zeolite is not
expected to contribute materially to USAC's operating revenues in the near
future.

Environmental Matters

The exploration, development and production programs conducted in the United
States are subject to local, state and federal regulations regarding
environmental protection. Certain of USAC's production and mining activities
are conducted on public lands. USAC believes that its current discharge of
waste materials from its processing facilities is in material compliance with
environmental regulations and health and safety standards. The USDA Forest
Service extensively regulates mining operations conducted in National
Forests. Department of Interior regulations cover mining operations carried
out on most other public lands.

All operations by USAC involving the exploration for or the production of
minerals are subject to existing laws and regulations relating to exploration
procedures, safety precautions, employee health and safety, air quality
standards, pollution of water sources, waste materials, odor, noise, dust and
other environmental protection requirements adopted by federal, state and
local governmental authorities.

USAC may be required to prepare and present to such authorities data
pertaining to the effect or impact that any proposed exploration for or
production of minerals may have upon the environment. Any changes to USAC's
reclamation and remediation plans which may be required due to changes in
federal regulations could have an adverse effect on USAC's operations. In
1994, the U.S. Forest Service, under the provisions of the Comprehensive
Environmental Response Liability Act of 1980, designated USAC's cyanide leach
plant at the Preachers Cove mill, which is located six miles north of Sunbeam,
Idaho on the Yankee Fork of the Salmon River, as a contaminated site requiring
cleanup of cyanide solution. In 1996, USAC signed a consent decree related to
the reclamation and remediation at the Preachers Cove mill in Idaho as
required by the Idaho Department of Environmental Quality. USAC has been
reclaiming the property; and, as of December 31, 2000, the cyanide solution
cleanup was complete, the mill removed, and some of the cyanide leach residue
disposed of. Only earth moving, monitoring activities, and the containment of
the remaining cyanide leach residue in a containment vault remain to complete
the activities prescribed by the consent decree. Upon completion of
reclamation activities at the Preachers Cove mill site pursuant to the consent
decree, the site will be closed and the Idaho Department of Environmental
Quality will terminate the consent decree. Reclamation activities are
currently at a standstill due to weather conditions at the site and the
completion of a biological assessment to be submitted to the National Marine
Fisheries Service and the U. S. Fish and Wildlife Service. Upon receiving
clearance from the U. S. Forest Service to commence the Phase II reclamation
work the Company anticipates substantial completion of reclamation in a six to
twelve month period.

USAC has environmental remediation obligations at its antimony processing site
near Thompson Falls, Montana ("the Stibnite Hill Mine Site"). Under the
regulatory jurisdiction of the Montana Department of Environmental Quality and
the U.S. Forest Service and subject to the operating permit requirements of
the Montana Department of Environmental Quality, USAC has performed
substantial environmental reclamation activities at this site during 1999 and
2000. These activities included installation of a PVC cover and a geotextile
layer on two of the tailings ponds and the removal of approximately 25,000
yards of tailings material from a third pond. USAC plans to line a storm
water pond and construct a water treatment facility, thus fulfilling the
majority of its environmental responsibilities at the Stibnite Hill Mine site.
Currently, reclamation activities have temporarily ceased while federal and
state regulatory agencies make certain determinations relating to the
disposition of the Company's slag material.

During the second quarter of 1999, USAC began final reclamation and closure at
the Yellow Jacket property. During the third and fourth quarters of 1999 USAC
began disassembly of the mill and mill buildings and removed tailings waste
from the tailings ponds. The reclamation activity is being overseen by the
U.S. Forest Service and the Idaho Department of Environmental Quality.
Reclamation work is commencing on the clean-up of non-cyanide tailings
material at the property; and USAC believes this project will be substantially
completed by the end of 2001. In 2000, the U.S. Forest Service began
releasing environmental bonding funds to USAC that had been deposited for
remediation of the Yellow Jacket Mine.

Reclamation activities at the Yellow Jacket Mine and the Stibnite Hill Mine
Site have proceeded informally under supervision of the U.S. Forest Service
and state departments of environmental quality. USAC has complied with
regulators' requirements and does not expect the imposition of substantial
additional requirements. The Company may have to increase its accrual for
reclamation costs, however, if state and federal regulators require USAC to
perform additional remediation activities if environmental laws change.

USAC has posted cash performance bonds with a bank and the U.S. Forest Service
in connection with its reclamation activities. Upon completion of reclamation
activities, the bonds will be terminated and the applicable regulatory
authorities may release up to $123,250.

The change in amounts accrued for environmental remediation activities in 1999
and as of December 31, 2000 is as follows:

Yankee Fork Thompson Falls Yellow Jacket
Mill Site Antimony Plant Mine Totals

Balance December 31, 1998 $116,028 $ 272,200 $115,044 $503,272
Less: Reclamation work (169,736) (73,893) (243,629)
Adjustment of Accrued
Remediation Costs (70,000) 51,150 73,893 55,043

Balance December 31, 1999 $ 46,028 $ 153,614 $115,044 $314,686
Less: Reclamation work 0 (60,913) (86,960) (147,873)
Adjustment of Accrued
Remediation Costs 0 25,615 86,960 112,575

Balance December 31, 2000 $ 46,028 $ 118,316 $115,044 $279,388

Marketing

During the first quarter of 1999, and in prior years dating back to 1991, USAC
marketed its antimony products with HoltraChem, Inc. and later its successor,
BCS, in a 50/50 profit sharing arrangement. In March 1999, USAC notified BCS
that it was terminating the agreements that HoltraChem had assigned BCS, and
that USAC was going to market and distribute antimony products independently.
As a result USAC took steps to market its products to existing and prospective
customers, and has been able to do so successfully. USAC employs full time
marketing personnel and has negotiated various commission-based sales
agreements with other chemical sales agents.

Antimony Price Fluctuations

The operating results of USAC have been and will continue to be directly
related to the market prices of antimony metal, which have fluctuated widely
in recent years. The volatility of such prices is illustrated by the
following table which sets forth the average prices of antimony metal per
pound as reported by sources deemed reliable by USAC.

Year Average Price
2000 $0.67
1999 0.58
1998 0.63
1997 0.93
1996 1.60

The range of sales prices for antimony oxide per pound is as follows for the
periods indicated:

Year High Low Average Price
2000 $5.88 $0.65 $0.99
1999 5.52 0.65 0.85
1998 5.57 0.83 1.13
1997 5.75 0.98 1.41
1996 4.50 1.53 1.86

Antimony metal prices are determined by a number of variables over which USAC
has no control. These include the availability and price of imported metals,
the quantity of new metal supply, and industrial and commercial demand. If
metal prices decline and remain depressed, USAC's revenues and profitability
may be adversely affected.

USAC uses antimony metal as a raw material for its products. USAC obtains
antimony metal from sources in China (70%), Canada (15%) and the U.S. (15%).
Purchases from Canadian and U.S. sources have been made at world market
prices, as established by the London Metals Bulletin from time to time.
Antimony metal from Chinese sources has been supplied by a metal dealer,
pursuant to a long-term supply contract to supply antimony metal at a fixed
price.

Until recently, antimony prices have been at a 35 year low. Beginning in late
June 2000, prices had risen dramatically, primarily as a result of
restrictions by the Chinese government on exports of antimony metal from
China, one of the principal suppliers of antimony. The fixed price set by the
supply contract with the dealer in Chinese-sourced metal was below current
market price. The dealer refused to supply metal at the contracted price,
forcing USAC to purchase antimony metal from this dealer and other sources at
current world market prices. However, USAC has been able to raise its
antimony product prices to its customers and to increase its gross profits.
USAC's USAMSA venture is intended eventually to reduce USAC's dependence on
foreign sources but is not expected to provide sufficient raw material for
several years.

Other

USAC holds no material patents, licenses, franchises or concessions, but
considers its antimony processing plant proprietary in nature. USAC uses the
trade name "Montana Brand Antimony Oxide" for the marketing of its antimony
products.

USAC is subject to the requirements of the Federal Mining Safety and Health
Act of 1977, requirements of the state of Montana and the state of Idaho,
Federal and State Health and Safety statutes and Sanders County, Lemhi County
and Custer County health ordinances.

Employees

As of March 30, 2001, USAC employed 25 full-time employees. The number of
full-time employees may vary seasonally. None of USAC's employees is covered
by any collective bargaining agreement.

Item 2. Description of Properties

Antimony Division

USAC's principal plant and mine are located in the Burns Mining District,
Sanders County, Montana, approximately 15 miles west of Thompson Falls,
Montana. USAC holds 2 patented mill sites and 12 patented lode mining claims
covering 192 acres. The lode claims are contiguous within two groups.

Antimony mining and milling operations were curtailed during 1983 due to
continued declines in the price of antimony. USAC is currently purchasing
foreign raw antimony materials and continues to produce antimony metal, oxide
and sodium antimonate from its antimony processing facility near Thompson
Falls, Montana.

Gold Division

Yankee Fork Mining & Yellow Jacket Mining Districts

The registrant is engaged in reclamation activities on two former gold mining
properties located in Custer and Lehmi Counties in Idaho.

Zeolite Division

Item 3. Legal Proceedings

At December 31, 2000, the company was involved in no material legal
proceedings.

Item 4. Submission of Matters to a Vote of Security Holders

On October 31, 2000, at an annual meeting of stockholders the following
directors were re-elected: (1)

Votes For Votes Against Votes Abstained
John C. Lawerence 14,657,428 6,300 14,586
Robert A. Rice 10,202,024 7,800 84,574
Leo Jackson 10,379,150 7,350 37,824

(1) Based on cumulative voting privileges of 11,859,172 shares represented at
the meeting in person or by proxy, out of the 17,860,384 shares outstanding
and entitled to vote as of the record date, August 3, 2000.

Also at the annual meeting the following three proposals were approved by
the stockholders:

Proposal 2. Amend the Company's Articles of Incorporation to increase the
number of authorized shares of common stock available for issuance from
20,000,000 to 30,000,000.

Votes For Votes Against Votes Abstained
11,753,588 70,148 34,186

Proposal 3. Amend the Company's Articles of Incorporation to authorize a
variable sized board

Votes For Votes Against Votes Abstained
9,645,353 2,181,763 30,806

Proposal 4. Ratify the appointment of the Company's independent auditors for
the fiscal year ending December 31, 2000

Votes For Votes Against Votes Abstained
9,687,003 2,137,033 33,886

PART II

Item 5. Market for Common Equity and Related Stockholder Matters

The following table sets forth the range of high and low bid prices as
reported by the Over the Counter Bulletin Board ("OTCBB") for the periods
indicated. The quotations reflect inter-dealer prices without retail mark-up,
mark-down or commission, and may not necessarily represent actual
transactions. Currently, the stock is traded on the OTCBB under the symbol
"UAMY."

2000 High Low
First Quarter $0.95 $0.22
Second Quarter 0.88 0.20
Third Quarter 0.78 0.32
Fourth Quarter 0.41 0.13

1999 High Low
First Quarter $0.16 $0.20
Second Quarter 0.17 0.17
Third Quarter 0.31 0.38
Fourth Quarter 0.16 0.16

The approximate number of record holders of USAC's common stock at December
31, 2000 is 2,700.

No dividends have been paid or declared by USAC during the last five years;
and USAC does not anticipate paying dividends on its common stock in the
foreseeable future. Instead, USAC expects to retain its earnings for the
operation and expansion of its business.

Item 6. Management's Discussion and Analysis or Plan of Operations

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 the Company's judgment as of the date of
this filing. The Company disclaims, however, any intent or obligation to
update these forward-looking statements.

Results of Operations

The Company reported a net loss of $67,699 during 2000 compared to net loss
of $230,086 in 1999. The net loss in 2000 is primarily attributable to a
$985,425 loss from operating activities in 2000, offset by an extraordinary
gain recognized on the conversion of certain debts to common stock of
$917,726. The net loss in 1999 is primarily due to a net loss from operations
of 307,677 offset by an extraordinary gain of $77,591 recognized on the
conversion of certain debts to common stock.

Total revenues from antimony product sales during 2000 were $5,016,661
compared to $4,710,278 in 1999. The increase in sales during 2000 was
partially due to the Company's sharing of 50% of antimony product sales with
an affiliated sales company during the first quarter of 1999 compared to
selling all of its antimony products independently during 2000. Sales of
antimony products during 2000 were 5,039,327 pounds at an average sale price
of $1.00 per pound; during 1999 5,517,443 pounds of antimony products were
sold at an average sales price of $0.85 per pound. Gross profit from antimony
product sales was $472,890 in 2000, or 9% of sales, compared to $876,178 in
1999, or 18.6% of sales. The decrease in gross profit during 2000 was due to
rapidly escalating antimony metal prices during the year that were quickly
reflected in higher production costs and, correspondingly, higher cost of
sales. Antimony product sale prices in the market reacted slower to the
increase in metal prices however, as competitors with greater quantities of
finished goods inventory on hand were able to continue selling products at
prices that were in effect prior to the increase in metal prices. During the
last quarter of 2000 and the first quarter of 2001, antimony product sales
prices increased; and as a result, the Company anticipates the return to a
higher level of gross profit.

Combined care, maintenance and reclamation costs and exploration and
evaluation costs at the Yellow Jacket property totaled $241,244 during 2000
compared to $200,867 in 1999. The increase during 2000 was due to the
Company's increased reclamation activities during 2000 compared to 1999.

During 1999, we updated and presented a Phase II reclamation plan to the U.S.
Forest Service detailing plans for the final reclamation of the Yankee Fork
Mill site. Based upon our analysis of costs required to implement the
specific tasks in the Phase II plan, we reduced the Yankee Fork reclamation
accrual by $70,000, to reflect our current estimate of costs required to
complete reclamation tasks.

During 2000, reclamation activities were at a standstill pending the
completion of a biological assessment to be submitted to the National Marine
Fisheries Service and the U.S. Fish and Wildlife Service.
Under the regulatory jurisdiction of the U.S. Forest Service and subject to
the operating permit requirements of the Montana Department of Environmental
Quality, we have performed substantial environmental reclamation activities
during 1999 and 2000 at our antimony processing site near Thompson Falls,
Montana. These activities included installation of a PVC liner and a
geotextile layer on two of the tailings ponds and the removal of approximately
25,000 yards of tailings material from a third pond. We made adjustments
increasing our reclamation accruals by $51,150 and $25,615 in fiscal years
1999 and 2000, respectively, based upon management's revised estimates of
costs to comply with regulatory requirements in effect during the respective
years. We plan to line a storm water pond and construct a water treatment
facility during 2001, thus fulfilling the majority of our environmental
responsibilities at the Stibnite Hill Mine site.

During the second quarter of 1999, we began final reclamation and closure at
the Yellow Jacket property. Upon Yellow Jacket's closure, we estimated the
required costs and time to perform closure activities, and adjusted the
Yellow Jacket reclamation liability on a quarterly basis, re-instating the
accrual as costs were incurred (a total of $73,893), to reflect our estimate
reclamation and closure costs left to incur.

During the third and fourth quarters of 1999 we began disassembly of the mill
and mill buildings and removed tailings waste from the tailings ponds. In
2000, we evaluated progress on Yellow Jacket's closure and reclamation and
continued to adjust the reclamation liability for costs as incurred (a total
of $86,960) based upon labor and equipment cost experience in 1999 and our
estimate of costs related to specific tasks yet-to-complete at year end.

General and administrative expenses increased from $400,432 in 1999, to
$631,869, an increase of $231,437 or approximately 58%. The increase in 2000
compared to 1999 was principally due to consulting expenses compensated with
shares of the Company's common stock totaling approximately $150,000 and legal
and accounting costs of approximately $64,000, associated with the filing of a
registration statement with the Securities and Exchange Commission.

Antimony sales expenses were $339,267 during 2000 and comparable to sales
expenses of $337,309 during 1999. Management expects sales expenses to
decrease in future periods based on restructuring efforts made to its sales
staff during 2000.

Interest expense of $157,145 in 2000 decreased compared to interest expense of
$185,985 in 1999 primarily due to the conversion of certain debts to common
stock in 2000. Interest and other income was $8,459 in 2000 and $12,190 in
1999. The decrease in interest and other income during 2000 was primarily due
to decreased interest earnings on reclamation bonds, when bonds were released
to the Company during 2000 as the Yellow Jacket property reclamation
progressed.

In 2000, the Company settled and extinguished a debt owed the Estate of Bobby
C. Hamilton of approximately $1.5 million (see Financial Condition and
Liquidity) through payment of $500,000 cash and issuance of 250,000 shares of
the Company's restricted common stock. In connection with the settlement the
Company recorded an extraordinary gain of $917,726. In 1999, the Company
converted $682,397 of defaulted debenture principal and interest and $144,339
of principal and interest related to certain mining lease royalties (Judgments
payable) into common stock of the Company. In connection with these
conversions the Company recorded an extraordinary gain of $77,591, and an
addition to paid-in-capital of 534,101.

Financial Condition and Liquidity

At December 31, 2000, Company assets totaled $893,920, and there was a
stockholders' deficit of $1,708,085. The stockholders' deficit decreased
$475,110 from the prior year, primarily due to the conversion of debts to
common stock. In order to continue as a going concern, the Company is
dependent upon (1) profitable operations from the antimony division, (2)
additional equity financing, and (3) continued availability of bank financing.
Without financing and profitable operations, the Company may not be able to
meet its obligations, fund operations and continue in existence. There can be
no assurance that management will be successful in its plans to improve the
financial condition of the Company.

Cash used by operations during 2000 was $731,000 compared to net cash provided
by operations during 1999 of $59,986, a change of approximately $851,000. The
change in cash used by operations in 2000 compared to cash provided by
operations in 1999 was primarily due to the operating loss (before
extraordinary item) of $985,425 in 2000 compared to the similar operating loss
of $307,677 during 1999.

Investing activities used $38,499 during 2000 compared to $76,417 used in
1999. Cash used in investing activities during both years related exclusively
to purchases and construction of antimony plant and equipment.

Financing activities provided $829,588 during 2000 compared to $16,431 of cash
in 1999. Cash from financing activities in 2000 related principally to cash
received from the sale of convertible debentures (and related warrants) and
common stock sales. Cash provided during 1999 related primarily to cash
received from bank financing.

Other significant financial commitments for future periods will include:

Servicing notes payable to bank.

Servicing convertible debenture interest and principal payments.

Completion and maintenance of an evergreen registration statement for
common shares held by certain shareholders.

Keeping current on property, payroll, and income tax liabilities and
accounts payable.

Fulfilling responsibilities with environmental, labor safety and
securities regulatory agencies.

In an effort to improve USAC's financial condition, USAC's management, during
the second quarter of 2000, negotiated the settlement of a debt of
approximately $1.5 million owed the Estate of Bobby C. Hamilton (the
"Estate"). USAC entered into a Settlement and Release of All Claims Agreement
(the "Settlement Agreement") with the Estate on June 23, 2000. The Settlement
Agreement extinguished the note payable to the Estate in exchange for a cash
payment of $500,000 and the issuance of 250,000 shares of USAC's common
stock.

The cash payment to the Estate was financed by the issuance of $600,000 of
Debentures pursuant to a financing agreement with Thomson Kernaghan & Co.,
Ltd., a Canadian investment banker. The financing agreement with Thomson
Kernaghan provided, among other things, for the sale of up to $1,500,000 of
USAC's convertible debentures to the investment banker and its affiliates.
The debentures are convertible into common stock at a price per share equal to
75% of the average of the three lowest closing bid prices per share of USAC's
common stock as reported by Bloomburg L.P. in the 20 trading days immediately
preceding the closing date of the debenture sale or the conversion date,
whichever is lower, but in any event not greater than $0.90 per share. The
debentures are due two years from their issue date and accrue interest at 10%
to be paid annually on each anniversary date of the issue. During 2000, USAC
issued $675,000 of convertible debentures pursuant to the financing
agreement. The maximum conversion price is $0.29125 per share. In connection
with the debenture sale, USAC issued warrants to purchase 1,394,230 shares of
common stock at $0.39 per share.

The financing agreement required that USAC execute a registration rights
agreement, binding USAC to prepare and file a registration statement with the
Securities and Exchange Commission registering the resale of shares of common
stock issuable upon conversion of the debentures and upon exercise of the
related warrants, and to increase the number of its authorized but outstanding
shares of common stock to accommodate the exercise of the warrants and
conversion of the debentures. During 2000, USAC expended substantial resources
in preparation of the registration statement; but as of the date of this
report, the registration statement has not yet become effective. The
9

registration rights agreement that USAC executed provides for certain
liquidated damages to be payable to the debenture holders for the delay of the
effectiveness of the registration statement. The liquidated damages are
calculated as two percent (2%) per month of the aggregate value of the
principal amount of the debentures outstanding combined with the aggregate
exercise prices of the outstanding purchasers' and agent's warrants issued in
connection with the convertible debentures, accrued on a daily basis
subsequent to the registration deadline. Accordingly, the filing of an
effective registration statement for the convertible debentures continues to
be a significant priority of the Company.

During 2000, the Company issued $247,922 of 10% convertible debentures (due
December 2003) to John C. Lawrence, the Company's president and a director.
The debentures were issued in exchange for various cash advances the Company
had received for working capital purposes from Mr. Lawrence during the year.
Also in December 2000, USAC issued two $50,000 10% convertible debentures (one
$50,000 debenture being due November 22, 2003 and the second debenture being
due December 12, 2003) to Al Dugan, a USAC shareholder and accredited
investor, in exchange for $100,000 cash paid by Mr. Dugan and used for working
capital purposes. The debentures issued to Mr. Lawrence and Mr. Dugan are
convertible into USAC's common stock at a conversion price which is the lower
of $0.31 per share or 75% of the average of the three lowest closing bid
prices for USAC's common stock as quoted by Bloomberg L.P. in the 20 trading
days immediately preceding the conversion date. In connection with the
issuance of these debentures USAC issued warrants to Mr. Lawrence and Mr.
Dugan to purchase 151,213 and 60,974 shares of common stock, respectively, at
$0.41 per share.

In 2000, the Company sold 782,511 shares of its common stock for $255,000,
with 100,000 shares sold pursuant to the exercise of stock purchase warrants.
Proceeds from stock sales were used to fund the Company's operations.

The Company anticipates funding its operations through additional sales of
common stock and debt financing in 2001. The Company believes that it will
have additional financial resources from increasing gross profits from its
antimony business and sales of zeolite from its newly formed Bear River
Zeolite Company subsidiary.

Item 7. Financial Statements

The consolidated financial statements of the registrant are included herein on
pages F1-F27.

Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure

None.

PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons,
Compliance with Section 16(a) of the Exchange Act

Identification of Directors and Executive Officers are as follows:

Affiliation
Name Age with Registrant Expiration of Term

John C. Lawrence 62 President, Director Annualmeeting
Robert A. Rice 76 Director Annual meeting
Leo Jackson 59 Director Annual meeting
Gary D. Babbitt 54 Director Annual meeting

Business Experience of Directors and Executive Officers

John C. Lawrence

Mr. Lawrence has been the President and a Director of USAC since its
inception. Mr. Lawrence was the President and a Director of AGAU Mines, Inc.,
the predecessor of USAC, since the inception of AGAU Mines, Inc., in 1968. He
is a member of the Society of Mining Engineers and a recipient of the Uuno
Sahinen Silver Medallion Award presented by Butte Tech, University of Montana.

Robert A. Rice

Mr. Rice is a metallurgist, having been employed by the Bunker Hill Company, a
wholly owned subsidiary of Gulf Resources and Chemical Corporation at Kellogg,
Idaho, as Senior Metallurgist and Mill Superintendent until his retirement in
1965. Mr. Rice has been a Director of USAC since 1975.

Leo Jackson

Mr. Jackson is a resident of El Paso, Texas. For the past 15 years, he has
been a principal owner and the President of Production Minerals, Inc., a
company which has an indirect 25% interest in the stock of USAMSA. Mr.
Jackson is the principal owner of Minera de Roja, S.A. de C.V., and has been
involved in the production and marketing of industrial minerals such as
fluorspar and celestite in the United States and Mexico for 25 years. Mr.
Jackson speaks fluent Spanish and has a BBA degree from the Sul Ross State
University in Texas. Mr. Jackson has been a Director of USAC since February
1999.

Gary D. Babbitt

Mr. Babbitt is a partner in the Boise, Idaho law firm of Hawley Troxell Ennis
& Hawley LLP, and has served as USAC's legal counsel for several years. Mr.
Babbitt concentrates his law practice in commercial litigation, environmental
matters and mining law. He is a member of the Society of Mining Engineers, a
director of the Idaho Mining Association, and a trustee of the Rocky Mountain
Mineral Law Foundation. Mr. Babbitt was appointed as a director when the
Board expanded to four members in November 2000.

USAC is not aware of any involvement by its directors or executive officers
during the past five years in legal proceedings that are material to an
evaluation of the ability or integrity of such director or executive officer.

Board Meetings and Committees

USAC's Board of Directors held twelve (12) regular meetings during the 2000
calendar year. Each incumbent director attended at least 75% of the meetings
held during the 2000 calendar year, in the aggregate, by the Board. USAC's
Board of Directors does not have a Compensation Committee, an Audit Committee,
or a Nominating Committee.

Board Member Compensation

Beginning in 2000, USAC pays directors' fees in the form of 25,000 shares of
USAC's Common Stock per year per director. Directors are also reimbursed
reasonable out-of-pocket expenses in connection with attending meetings.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires that USAC's
directors, executive officers and holders of 10% or more of USAC's common
stock file reports of ownership and changes in ownership with the Securities
and Exchange Commission. Officers, directors and stockholders holding more
than 10% of USAC's common stock are required by the regulation to furnish USAC
with copies of all Section 16(a) forms they have filed.

Based solely on review of copies of Forms 3, 4, and 5 furnished to USAC, Mr.
Lawrence timely filed Form 4 reports during 2000 and timely filed a Form 5
annual report with respect to the 2000 fiscal year. Mr. Babbitt is late
filing a Form 5 report for the 2000 fiscal year. It is unknown to the Company
if Mr. Rice and Mr. Jackson timely filed, during 2000, Form 4 reports upon
receipt of annual stock compensation or Form 5 annual reports with respect to
the 2000 fiscal year. It is unknown to the Company if Al Dugan, a shareholder
who became a 10% beneficial owner during 2000, timely filed Form 3 or Form 4
reports during 2000, or timely filed a Form 5 report for the 2000 fiscal year.

Item 10. Executive Compensation

Summary Compensation Table

The Securities and Exchange Commission requires the following table setting
forth for fiscal years ending December 31, 2000, 1999 and 1998, the
compensation paid by USAC to its principal executive officer.

Annual Compensation Long-Term Compensation
Awards Payouts
Restricted Securities
Other Annual Options/ Underlying All Other All Other
Name and Principal Position Year Salary Bonus Compensation(1) Awards(2) LTIP SARs Payouts Compensation

John C. Lawrence, President 2000 $81,000 N/A $4,154 $3,250 None None None
John C. Lawrence, President 1999 $72,000 N/A $4,154 $720 None None None
John C. Lawrence, President 1998 $72,000 N/A $4,154 $844 None None None

(1) Represents earned but unused vacation.
(2) These figures represent the fair values, as of the date of issuance,
of the annual Director's fee payable to Mr. Lawrence in the form
of shares of USAC's restricted Common Stock.

Item 11. Security Ownership of Certain Beneficial Owners and Management

A person who directly or indirectly has or shares voting power or investment
power with respect to a security is considered a beneficial owner of the
security. Voting power is the power to vote or direct the voting of shares
and investment power is the power to dispose of or direct the disposition of
shares. Shares as to which voting power or investment power may be acquired
within 60 days are also considered as beneficially owned.

The following tables set forth certain information, as of March 30, 2001,
regarding beneficial ownership of USAC's stock by (1) each person who is known
to USAC to own beneficially more than 5% of any class of USAC's voting stock,
and (2) (a) each director and each nominee for the election as a director of
USAC, (b) each executive officer named in the Summary Compensation Table set
forth above, and (c) all current directors and current executive officers of
USAC as a group. The information on beneficial ownership in the table and the
footnotes thereto is based upon USAC's records and, in the case of holders of
more than 5% of USAC's stock, the most recent Schedule 13D or 13F filed by
each such person or entity and information supplied to USAC by such person or
entity. Unless otherwise indicated, to USAC's knowledge each person has sole
voting power and sole investment power with respect to the shares shown.

Security Ownership of Certain Beneficial Owners(7)

As of the close of business on March 30, 2001, based on information available
to USAC, the following persons own beneficially more than 5% of any class of
the outstanding voting securities of USAC:

Name and Address of Amount and Nature of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class

Common stock The Maguire Family and 1,501,898(2) 6.1 (1)
related entities as a group
c/o Walter L. Maguire, Sr.
P.O. Box 129
Keller, VA 23401

Common stock John C. Lawrence 3,537,827(3),(6) 14.4 (1)
P.O. Box 643
Thompson Falls, MT 59873

Common stock The Dugan Family 2,623,072(4),(6) 10.7 (1)
c/o A. W. Dugan
1415 Louisiana Street, Suite 3100
Houston, TX 77002

Preferred Series A A. Gordon Clark, Jr. 4,500(5) 100.0
stock 2 Musket Trail
Simsbury, CT 06070

Preferred Series C Walter L. Maguire, Sr. 49,091 27.6
stock P.O. Box 129
Keller, VA 23401

Preferred Series C Richard A. Woods 48,305 27.2
stock 59 Penn Circle West
Penn Plaza Apts.
Pittsburgh, PA 15206

Preferred Series C Dr. Warren A. Evans 48,305 27.2
stock 69 Ponfret Landing Road
Brooklyn, CT 06234

Preferred Series C Edward Robinson 32,203 18.0
stock 1007 Spruce Street 1st Floor
Philadelphia, PA 19107

Security Ownership of Management as of March 30, 2001

Name of Amount of Percent of
Title of Class Beneficial Owner Beneficial Ownership Class

Common stock John C. Lawrence 3,537,827(3) 14.4
Common stock Robert A. Rice 217,762 0.9
Common stock Leo Jackson 60,700 Nil
Common stock Gary D. Babbitt 5,967 Nil
---------- ----
Common stock All Directors and executive
officers as a group 3,822,256 15.6
---------- ----

(1)Percent of ownership is based upon 24,534,984 shares of common stock
and common stock equivalents outstanding at March 30, 2001 (including
shares subject to presently exercisable warrants, $675,000 of debentures
convertible at $0.29125 per share, and $347,922 of debentures convertible
at $0.31 per share). At March 30, 2001 4,500 shares of Series A preferred
stock and 177,904 shares of Series C preferred stock were outstanding.

(2)Includes 1,007,843 shares owned by the Maguire Foundation; 129,000
shares owned by Walter L. Maguire, Sr.; 45,500 shares owned by Walter L.
Maguire, Trustee; 219,555 shares owned by Walter L. Maguire, Jr.; and
warrants issued to donees of Walter L. Maguire, Sr. to purchase 100,000
shares of common stock. Excludes 1,003,409 shares owned by the 1934
Maguire Trust.

(3)Includes 2,336,640 shares of common stock, warrants to purchase
401,213 shares of common stock, and 799,974 shares issuable upon the
conversion of the principal balance of convertible debentures into common
stock at $0.31 per share. Excludes 75,000 shares owned by Mr. Lawrence's
sister, as to which Mr. Lawrence disclaims beneficial ownership.

(4)Includes 316,667 shares owned by Al Dugan; 183,333 shares owned by
Lydia Dugan; 60,000 shares owned by Joel and Ellen Dugan; 1,331,440
shares, in the aggregate, owned by companies owned and controlled by Al
Dugan; warrants issued to Mr. Dugan to purchase 409,051 shares of common
stock; and 322,581 shares issuable upon the conversion of the principal
balance of convertible debentures into common stock at $0.31 per share.

(5)The outstanding Series A and Series C preferred shares carry voting
rights.

(6)The debenture conversion price is the lower of $.31 per share or 75%
of the average of the three lowest closing bid prices during the 20 trading
days prior to the conversion date. If the actual conversion price is less
than $.31 per share, the debenture holder will be entitled to a greater
number of common shares upon conversion.

(7)Thomson Kernaghan & Co., Ltd. is the beneficial owner of 150,000
shares of Company's common stock. In addition, by Agreement effective July
11, 2000, Thomson Kernaghan purchased, individually and as agent for other
investors, $675,000 principal amount of convertible debentures, an agent's
warrant to purchase 961,358 shares of Company's common stock at $.39 per
share and a purchaser's warrant to purchase 432,692 shares of Company's
common stock at $.39 per share. The debentures are convertible into
common stock at the lower of $0.29125 per share or 75% of the average of
the lowest closing bid prices during the 20 trading days preceding the
conversion date. Assuming conversion of the debentures at $0.29125 per
share and exercise of the warrants, Thomson Kernaghan would be the record
owner of 3,861,647 shares, or 15.7%, of the Company's outstanding common
stock and common stock equivalents.

However, Thomson Kernaghan disclaims beneficial ownership of all of the shares
issuable upon conversion of the debentures or exercise of the agent's warrant
or the purchaser's warrant. Further, Thomson Kernaghan has advised the
Company that it is not a member of a group, as defined in § 13(d) of the
Securities and Exchange Act of 1934, which owns 5% or more of Company's common
stock.

Item 12. Certain Relationships and Related Transactions

See transactions described in notes 4, 7, 9, 12, 14 and 17 to USAC's Financial
Statements as of December 31, 2000.

Item 13. Exhibits and Reports on Form 8-K

Exhibit Number Description

3.01 Articles of Incorporation of USAC,
Filed as an exhibit to USAC's Form 10-KSB for the fiscal
year ended December 31, 1999 (File No. 1-8675) are incorporated
herein by this reference.

3.02* Amended and Restated Bylaws of USAC

3.03* Articles of correction of Restated Articles of Incorporation of
USAC.

4.01 Key Employees 2000 Stock Plan, filed as an exhibit to USAC's
Form S-8 Registration Statement filed on March 10, 2000
(File No. 333-32216) Is incorporated herein by this reference.

10.0 Material Contracts

Documents filed with USAC's Annual Report on Form 10-KSB for
the year ended December 31, 1995 (File No. 1-8675), are
incorporated herein by this reference:

10.10 Yellow Jacket Venture Agreement July 7, 1990

10.11 Agreement Between Excel-Mineral
USAC and Bobby C. Hamilton August 29, 1991

10.12 Letter Agreement September1, 1991

10.13 Columbia-Continental Lease
Agreement Revision April 3, 1993

10.14 Settlement Agreement with
Excel Mineral Company July 1993

10.15 Memorandum Agreement July 1993

10.16 Termination Agreement September 12, 1993

10.17 Amendment to Assignment of Lease
(Geosearch) September 9, 1994

10.18 Series B Stock Certificate to
Excel-Mineral Company, Inc. December 25, 1993

10.19 Division Order and Purchase and
Sale Agreement March 27, 1995

10.20 Inventory and Sales Agreement January 1, 1995

10.21 Processing Agreement July 1, 1995

10.22 Release and settlement agreement
between Bobby C. Hamilton and
United States Antimony Corporation November 15, 1995

10.23 Columbia-Continental Lease
Agreement September 27, 1996

10.24 Release of Judgment February 28, 1996

10.25 Covenant Not to Execute July 30, 1990

Documents filed with USAC's Annual Report on Form 10-KSB for the year ended
December 31, 1996 (File No. 1-8675), are incorporated herein by this
reference:

Exhibit No. Item Dated

10.26 Warrant Agreements Various

Document filed with USAC's Quarterly Report on Form 10-QSB for the quarter
ended September 30, 1997 (File No. 001-08675) is incorporated herein by this
reference:

Exhibit No. Item Dated

10.27 Letter from EPA, Region 10 August 21, 1997

Documents filed with USAC's Annual Report on Form 10-KSB for the year ended
December 31, 1997 (File No. 001-08675) are incorporated herein by this
reference:

Exhibit No. Item Dated

10.28 Warrant Agreements Various

Document filed with USAC's Quarterly Report on Forms 10-QSB for the quarter
ended September 30, 1998 (File No. 001-08675) is incorporated herein by this
reference:

Exhibit No. Item Dated

10.30 Answer, Counterclaim and Third-Party
Complaint October 13, 1998

Documents filed with USAC's Annual Report on Form 10-KSB for the year ended
December 31, 1998 (File No. 001-08675), are incorporated herein by this
reference:

Exhibit No. Item Dated

10.31 Warrant Issue-Al Dugan July 28, 1998

10.32 Amendment Agreement March 31, 1999

Documents filed with USAC's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1999 (File No. 001-08675) are incorporated herein by this
reference:

Exhibit No. Item Dated

10.33 Warrant Issue-John C. Lawrence March 29, 1999

10.34 PVS Termination Agreement March 31, 1999

Documents filed as an exhibit to USAC's Form 10-KSB for the year ended
December 31, 1999 (File No. 001-08675) are incorporated herein by this
reference:

Exhibit No. Item Dated

10.35 Maguire Settlement Agreement November 5, 1999

10.36 Warrant Issue-Carols Tejada August 30, 1999

10.37 Warrant Issue-Al W. Dugan January 25, 2000

Exhibit No. Item Dated

10.38 Memorandum of Understanding with
Geosearch Inc. October 4, 1999

10.39 Factoring Agreement-Systran
Financial Services Company March 30, 1999

10.40 Mortgage to John C. Lawrence April 19, 1999

Document filed with USAC's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 2000 (File No. 001-08675) is incorporated herein by this
reference:

Exhibit No. Item Dated

10.41 Warrant Issue-Al W. Dugan January 25, 2000

Documents filed as an exhibit to USAC form 10-QSB for the quarter ended June
30, 2000 (File No. 001-08675) are incorporated herein by this reference:

Exhibit No. Item Dated

10.42 Agreement between United States
Antimony Corporation and Thomson
Kernaghan & Co., Ltd. July 11, 2000

10.43 Settlement agreement and release of all
claims between the Estate of Bobby C.
Hamilton and United States Antimony
Corporation June 23, 2000

Exhibit No. Description Page

21.01* Subsidiaries of USAC II

Dated

44.1 CERCLA Letter from U.S. Forest Service
filed as an exhibit to USAC's Form 10-KSB
for the year ended December 31, 1995 (File
No. 1-8675) is incorporated herein by
this reference. February 11, 1994

* Exhibits 3.02, 3.03, and 21.01, are filed with this Form 10-KSB. All
other exhibits are incorporated by reference to previous filings identified
above.

Documents filed with the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1995, and incorporated by reference to such:

There were no reports on Form 8-K filed during the quarter ended December 31,
2000.

Exhibit 21.0

Subsidiaries of Registrant, as of December 31, 2000
Bear River Zeolite Company
c/o Box 643
Thompson Falls, MT 59873

United States Antimony Corporation, Montana
c/o Box 643
Thompson Falls, MT 59873

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. Lawrence
John C. Lawrence, President, Director
and Principal Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

By:/s/ John C. Lawrence Date: March 30, 2001
John C. Lawrence, Director and President
(Principal Executive, Financial and Accounting
Officer)

By:/s/ Leo Jackson Date: March 30, 2001
Leo Jackson, Director

By:/s/ Robert A. Rice Date :March 30, 2001
Robert A. Rice, Director

By:/s/ Gary D. Babbitt Date :March 30, 2001
Gary D. Babbitt, Director

Report of Independent Accountants

The Board of Directors and Stockholders of
United States Antimony Corporation

We have audited the accompanying consolidated balance sheets of United States
Antimony Corporation and its subsidiaries as of December 31, 2000 and 1999,
and the related consolidated statements of operations, changes in
stockholders' deficit and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of United States
Antimony Corporation and its subsidiaries as of December 31, 2000 and 1999,
and the consolidated results of their operations and their cash flows for the
years then ended, in conformity with generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to
the financial statements, the Company has negative working capital, an
accumulated deficit and total stockholders' deficit that raise substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 1. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.

As discussed in Note 20. to the consolidated financial statements, the Company
has restated certain amounts in its previously reported consolidated financial
statements for the year ended December 31, 1999.

Spokane, Washington
March 22, 2001, except for Note 20.
which is as of October 19, 2001

F-1

United States Antimony Corporation and Subsidiaries
Consolidated Balance Sheets
December 31, 2000 and 1999

2000 1999
(as restated)
ASSETS

Current assets:
Restricted cash $ 8,518 $ 227
Inventories 221,457 276,599
Accounts receivable, less allowance
for doubtful accounts of $30,000 and $50,000 119,568 60,205
------------- -----------
Total current assets 349,543 337,031
Investment in USAMSA 111,088 111,088
Properties, plants and equipment, net 246,250 341,417
Restricted cash for reclamation bonds 123,250 178,986
Deferred financing charges, net 63,789
------------- -----------
Total assets $ 893,920 $ 968,522
============= ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
Checks issued and payable $ 107,133 $ 45,544
Accounts payable 429,654 467,596
Accrued payroll and property taxes 241,588 263,667
Accrued payroll and other 89,680 132,464
Judgment payable 43,480 40,645
Accrued interest payable 47,324 14,640
Due to related parties 10,307 8,128
Notes payable to bank, current 150,625 160,395
Note payable to Bobby C. Hamilton, current 87,596
Accrued reclamation costs, current 80,000 256,000
------------- -----------
Total current liabilities 1,199,791 1,476,675

Debentures payable, net of discount 997,449
Notes payable to bank, noncurrent 205,377 165,570
Note payable to Bobby C. Hamilton, noncurrent 1,450,785
Accrued reclamations costs, noncurrent 199,388 58,687
------------- ----------
Total liabilities 2,602,005 3,151,717
------------- ----------

Commitments and contingencies (Notes 1 and 18)
Stockholders' deficit:
Preferred stock, $.01 par value, 10,000,000
shares authorized:
Series A: 4,500 shares issued and outstanding
(liquidation preference $110,250) 45 45
Series B: 750,000 shares issued and outstanding
(liquidation preference $802,500) 7,500 7,500
Series C: 177,904 and 205,996 shares issued and outstanding
(liquidation preference $97,847) 1,779 2,060
Common stock, $.01 par value, 30,000,000
and 20,000,000 shares authorized; 18,375,564
and 16,900,252 shares issued and outstanding 183,755 169,003
Additional paid-in capital 15,352,386 14,824,048
Accumulated deficit (17,253,550) (17,185,851)
------------ ------------
Total stockholders' deficit (1,708,085) (2,183,195)
------------ ------------
Total liabilities and stockholders' deficit $ 893,920 $ 968,522
============ ============

The accompanying notes are an integral part of these financial statements.
F-2

United States Antimony Corporation and Subsidiaries
Consolidated Statements of Operations
For the years ended December 31, 2000 and 1999

2000 1999
(as restated)

Revenues:
Sales of antimony products and other $ 5,016,661 $ 4,710,278

Cost of antimony production 4,037,289 3,511,097
Freight and delivery 506,482 323,003
----------- -------------

Gross profit 472,890 876,178
----------- -------------

Other operating expenses:
Exploration and evaluations 53,985
Reclamation-antimony 25,615 51,150
Care, maintenance, and reclamation-Yellow Jacket 241,244 146,882
General and administrative 631,869 400,432
Sales expenses 339,267 337,309
----------- -------------
1,237,995 989,758
----------- -------------
Other (income) expense:
Gain from accrued reclamation costs adjustment (70,000)
Gain from accounts payable adjustment (29,322) (16,440)
Interest expense 157,145 185,985
Factoring expense 100,956 106,742
Interest income and other (8,459) (12,190)
---------- -------------
220,320 194,097
---------- -------------

Loss before extraordinary item (985,425) (307,677)
Extraordinary gain on conversion of debts to common
stock 917,726 77,591
---------- -------------

Net loss $ (67,699) $ (230,086)
============= =============

Basic net loss per share of common stock
Before extraordinary item $ (0.06) $ (0.02)
Extraordinary item 0.05 Nil
------------- -------------
Net loss $ (0.01) $ (0.02)
============= =============

Basic weighted average shares outstanding 17,772,693 14,597,917
============= =============

Diluted net loss per share of common stock
Before extraordinary item $ (0.06) $ (0.02)
Extraordinary item 0.05 Nil
------------- -------------
Net loss $ (0.01) $ (0.02)
============= =============

Diluted weighted average shares outstanding 17,772,693 14,839,455
============= =============

The accompanying notes are an integral part of these financial statements.
F-3

United States Antimony Corporation and Subsidiaries
Consolidated Statements of Changes in Stockholders' Deficit
for the years ended December 31, 2000 and 1999

Preferred Stock
Series A Series B Series C Common Stock Additional
Paid Accumulated
Shares Amount Shares Amount Shares Amount Shares Amount In Capital Deficit Total

Balances, December
31, 1998 4,500 $45 750,000 $7,500 2,560,762 $25,608 13,425,925 $134,259 $14,079,260 $(16,955,765) $(2,709,093)

Issuance of common
stock for cash
purchased by
employees 4,800 48 1,152 1,200

Issuance of common
stock in exchange
for services 40,000 400 9,600 10,000

Issuance of common
stock for conversion
of debts 1,036,761 10,368 729,656 740,024

Issuance of common
stock to employees
for compensation 20,000 200 2,400 2,600

Issuance of common
stock to directors
for compensation 18,000 180 1,980 2,160

Conversion of series
C preferred stock
to common stock (2,354,766) (23,548) 2,354,766 23,548

Net loss (230,086) (230,086)
----- --- ------- ------ ----------- -------- --------- -------- ---------- ------------ -----------
Balances December
31, 1999 4,500 $45 750,000 $7,500 205,996 $ 2,060 16,900,252 $169,003 $14,824,048 $(17,185,851) $(2,183,195)
(as restated)

Issuance of common
stock for cash 682,511 6,825 223,175 230,000

Exercise of stock
warrants 100,000 1,000 24,000 25,000

Issuance of common
stock for services 300,000 3,000 150,000 153,000

Issuance of common
stock as settlement
of debt 250,000 2,500 78,125 80,625

Conversion of series
C preferred
stock to common stock (28,092) (281) 28,092 281

Issuance of common
stock to former Series C
preferred stockholders 35,542 355 3,910 4,265

Warrants issued for
consulting services 10,000 10,000

Warrants issued in
connection with convertible
debentures 29,628 29,628

Common stock issued
to directors for compensation 79,167 791 9,500 10,291

Net loss (67,699) (67,699)
----- ---- ------- ------ -------- ------ ---------- -------- ----------- ------------ -----------
Balances, December
31, 2000 4,500 $45 750,000 $7,500 177,904 $1,779 18,375,564 $183,755 $15,352,386 $(17,253,550) $(1,708,085)
===== ==== ======= ====== ======== ====== ========== ======== =========== ============ ===========

The accompanying notes are an integral part of these financial statements.
F-4

United States Antimony Corporation and Subsidiaries
Consolidated Statements of Cash Flows
for the years ended December 31, 2000 and 1999

2000 1999
(as restated)

Cash flows from operating activities:
Net loss $ (67,699) $ (230,086)
Adjustments to reconcile net income (loss) to
net cash provided by operations:
Depreciation 133,666 130,714
Amortization of deferred financing charges 18,711
Write off of capitalized start-up costs 8,590
Extraordinary gain on conversion of debts to common stock (917,726) (77,591)
Gain from accrued reclamation costs adjustment (70,000)
Gain from accounts payable adjustment (29,322) (16,440)
Provision for doubtful accounts (20,000) 50,000
Issuance of common stock to directors as compensation 10,291 2,160
Issuance of common stock to employees as compensation 2,600
Issuance of common stock and warrants for services 163,000 10,000
Issuance of common stock to former Series C holders 4,265
Change In:
Restricted cash (8,291) (6)
Accounts receivable (39,363) (110,205)
Inventories 55,142 88,799
Restricted cash for reclamation bond 55,736
Deferred financing charges (82,500)
Accounts payable (8,620) 228,863
Accrued payroll and property taxes (22,079) 95,185
Accrued payroll and other (42,784) 35,752
Judgments payable 2,835 11,780
Accrued debenture interest payable 36,769 13,250
Payable to related parties 2,179 5,206
Accrued reclamation costs (35,299) (118,585)
---------- ----------
Net cash provided by operating activities (791,089) 59,986
---------- ----------

Cash flows from investing activities:
Purchase of properties, plants and equipment (38,499) (76,417)
---------- ----------
Net cash used in investing activities (38,499) (76,417)
---------- ----------

Cash flows from financing activities:
Proceeds from issuance of common stock and warrants 230,000
Exercise of warrants 25,000
Proceeds from bank term note payable 250,000 259,484
Payments on notes payable to bank (219,963) (200,330)
Change in checks issued and payable 61,589 14,455
Proceeds from issuance of convertible debentures 1,022,992
Payments on note payable to Bobby C. Hamilton (540,030) (57,178)
---------- ----------
Net cash provided by financing activities 829,588 16,431
---------- ----------

Net decrease in cash 0 0
Cash, beginning of year 0 0
---------- ----------
Cash, end of year $ 0 $ 0
========== ==========

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

United States Antimony Corporation and Subsidiaries
Consolidated Statements of Cash Flows, Continued:
for the years ended December 31, 2000 and 1999

2000 1999

Supplemental disclosures:
Cash paid during the year for interest $ 119,866 $ 157,239
============= =========

Noncash financing activities:
Discount on debentures payable for detachable warrants 29,682
Judgment payable converted to common stock 144,339
Debentures payable converted to common stock 335,000
Accrued debenture interest payable converted to common stock 347,397
Series C preferred stock converted to common stock 281 23,548
Note payable to Bobby C. Hamilton converted to common stock 958,321

The accompanying notes are an integral part of these financial statements.
F-6

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements

1. Background of Company and Basis of Presentation:

AGAU Mines, Inc., predecessor of United States Antimony Corporation ("USAC" or
"the Company"), was incorporated in June 1968 as a Delaware Corporation to
mine gold and silver. USAC was incorporated in Montana in January 1970 to mine
and produce antimony products. In June 1973, AGAU Mines, Inc. was merged into
USAC. In December 1983, the Company suspended its antimony mining operations
when it became possible to purchase antimony raw materials more economically
from foreign sources.

The principal business of the Company has been the production and sale of
antimony products. Up until the first quarter of 1999 the Company sold its
products pursuant to a profit sharing agreement with affiliated chemical sales
companies. On March 31, 1999, the company terminated the agreement and
started selling its products independently.

In September of 2000, the Company finalized its purchase of a 50% interest in
United States Antimony, Mexico S.A. de C.V. ("USAMSA") to mine, mill and
produce antimony metal and other related products from certain states in
Mexico. During 2000, the Company formed a 75% owned subsidiary, Bear River
Zeolite Company, to mine and market zeolite and zeolite products from a
mineral deposit in south-eastern Idaho.

The financial statements have been prepared on a going concern basis which
assumes realization of assets and liquidation of liabilities in the normal
course of business. At December 31, 2000, the Company had negative working
capital of approximately $850,000, an accumulated deficit of approximately
$17.2 million and a total stockholders' deficit of approximately $1.7 million.
These factors, among others, indicate that there is substantial doubt that the
Company will be able to meet its obligations and continue in existence as a
going concern. The financial statements do not include any adjustments that
may be necessary should the Company be unable to continue as a going concern.

To improve the Company's financial condition, the following actions have been
initiated or taken by management:

-In 2000 and 1999, the Company devoted substantial efforts to the
research and development of new antimony products and applications.These
efforts have resulted in advances in the Company's preparation,
packaging, and quality of the antimony products it delivers to customers.
The Company believes that it will be able to stay competitive in the
antimony business and generate increasing profits because of these
advances.

-In 2000 and 1999, the Company converted debts totaling $958,321
and $826,736, respectively, of principal and accrued interest into common
stock of the Company.

-During 2000, the Company negotiated a financing arrangement with
a Canadian investment banking firm, that provides borrowings of up to
$1.5 million in convertible debentures and related warrants. Pursuant to
this arrangement, the Company borrowed $675,000 in 2000.

F-7

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

1. Background of Company and Basis of Presentation, Continued:

-In 2000, the Company generated $255,000 through sales of 682,511
shares of its unregistered common stock and warrants to existing
shareholders and the exercise of 100,000 stock purchase warrants. The
Company plans to raise equity funding through additional stock sales in
2001. However, there can be no assurance that the Company will be able to
successfully raise additional capital through the sale of its stock.

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

2. Concentration of Risk:

The Company purchases the majority of its raw antimony used in the production
of finished antimony products from Chinese producers through metal brokers.
If the supply of antimony from China is reduced, it is possible that the
Company's antimony product operations could be adversely affected. During the
years ended December 31, 2000 and 1999, 25% and 20%, respectively, of the
Company's revenues were generated by antimony product sales to one customer.
In addition, during 2000, 11% of the Company's revenues were generated by
antimony product sales to a second individual customer.

Many of the Company's competitors in the antimony industry have substantially
more capital resources and market share than the Company. Therefore, the
Company's ability to maintain its market share can be significantly affected
by factors outside of the Company's control.

The Company's revenues from antimony sales are strongly influenced by world
prices for such commodities, which fluctuate and are affected by numerous
factors beyond the Company's control, including inflation and worldwide forces
of supply and demand. The aggregate effect of these factors is not possible to
accurately predict.

3. Summary of Significant Accounting Policies:

Principles of Consolidation

The Company's consolidated financial statements also include the accounts of
Bear River Zeolite Company, a 75% owned subsidiary. Intercompany balances and
transactions are eliminated in consolidation. The Company accounts for its
investment interest in its 50% owned foreign entity, USAMSA, by the equity
method.

Restricted Cash

Restricted cash consists of cash held for investment in USAMSA, payment of
delinquent payroll taxes and reclamation performance bonds.

F-8

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

3. Summary of Significant Accounting Policies, Continued:

Inventories

Inventories at December 31, 2000 and 1999, consisted of ownership of antimony
metal, metal in process and finished goods that are stated at the lower of
first-in, first-out cost or estimated net realizable value. Since the
Company's inventory is a commodity with a sales value that is subject to world
prices for antimony that are beyond the Company's control, a significant
change in the world market price of antimony could have a significant effect
on the net realizable value of inventories.

Deferred Financing Charges

Deferred financing charges related to convertible debenture sales are
amortized on a straight-line basis over the term of the debentures.

Properties, Plants and Equipment

Production facilities and equipment are stated at the lower of cost or
estimated net realizable value and are depreciated using the straight-line
method over their estimated useful lives (five to fifteen years). Vehicles and
office equipment are stated at cost and are depreciated using the
straight-line method over estimated useful lives of three to five years.
Maintenance and repairs are charged to operations as incurred. Betterments of
a major nature are capitalized. When assets are retired or sold, the costs and
related accumulated depreciation are eliminated from the accounts and any
resulting gain or loss is reflected in operations.

Management of the Company periodically reviews the net carrying value of all
of its properties on a property-by-property basis. These reviews consider the
net realizable value of each property to determine whether a permanent
impairment in value has occurred and the need for any asset write-down. The
Company considers current metal prices, cost of production, proven and
probable reserves and salvage value of the property and equipment in its
valuation.

Management's estimates of metal prices, operating capital requirements and
reclamation costs are subject to risks and uncertainties of changes affecting
the recoverability of the Company's investment in its properties, plants and
equipment. Although management has made its best estimate of these factors
based on current conditions, it is reasonably possible that changes could
occur in the near term which could adversely affect management's estimate of
net cash flows expected to be generated from its properties, and necessitate
asset impairment write-downs.

The Company has adopted the provisions of Statement of Financial Accounting
Standards No. 121 ("SFAS No. 121"), "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of." SFAS No. 121
requires that an impairment loss be recognized when the estimated future cash
flows (undiscounted and without interest) expected to result from the use of
an asset are less than the carrying amount of the asset. Measurement of an
impairment loss is based on the estimated fair value of the asset if the asset
is expected to be held and used.

F-9

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

3.Summary of Significant Accounting Policies, Continued:

Reclamation and Remediation

All of the Company's mining operations are subject to reclamation and closure
requirements. Minimum standards for mine reclamation have been established by
various governmental agencies. Costs are estimated based primarily upon
environmental and regulatory requirements and are accrued and charged to
expense over the expected economic life of the operation using the
units-of-production method. The liability for reclamation is classified as
current or noncurrent based on the expected timing of expenditures.

The Company accrues costs associated with environmental remediation
obligations when it is probable that such costs will be incurred and they are
reasonably estimable. Costs of future expenditures for environmental
remediation are not discounted to their present value. Such costs are based on
management's current estimate of amounts that are expected to be incurred when
the remediation work is performed within current laws and regulations. The
Company has restricted cash balances that have been provided to ensure
performance of its reclamation obligations.

It is reasonably possible that, due to uncertainties associated with defining
the nature and extent of environmental contamination, application of laws and
regulations by regulatory authorities, and changes in remediation technology,
the ultimate cost of remediation and reclamation could change in the future.
The Company continually reviews its accrued liabilities for such remediation
and reclamation costs as evidence becomes available indicating that its
remediation and reclamation liability has changed.

Income Taxes

The Company records deferred income tax liabilities and assets for the
expected future income tax consequences of events that have been recognized in
its financial statements. Deferred income tax liabilities and assets are
determined based on the temporary differences between the financial statement
carrying amounts and the tax bases of assets and liabilities using enacted tax
rates in effect in the years in which the temporary differences are expected
to reverse.

Revenue Recognition

Sales of antimony products are recorded upon shipment to the customer.

Income (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.

F-10

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

3. Summary of Significant Accounting Policies, Continued:

Stock-Based Compensation

Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("SFAS No. 123"), requires companies to recognize
stock-based expense based on the estimated fair value of employee stock
options. Alternatively, SFAS No. 123 allows companies to retain the current
approach set forth in APB Opinion 25, "Accounting for Stock Issued to
Employees," provided that expanded footnote disclosure is presented. The
Company has not adopted the fair value method of accounting for stock-based
compensation under SFAS No. 123, but provides the pro forma disclosure
required when appropriate.

Recent Accounting Pronouncements

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," as amended, which defines derivatives,
requires that all derivatives be carried at fair value, and provides for hedge
accounting when certain conditions are met. This statement is effective for
the first fiscal quarter of fiscal years beginning after June 15, 2000.
Adoption of this statement will not have a material impact on the Company's
consolidated financial position, results of operations or cash flows.

In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements"
("SAB 101"). SAB 101 provides guidance on the recognition, presentation and
disclosure of revenue in financial statements. All registrants are expected to
apply the accounting and disclosures described in SAB 101. The Company is
required to adopt SAB 101 in the fourth quarter of fiscal 2001, retroactive to
the beginning of the year. Adoption of SAB 101 will not have a material impact
on the Company's consolidated financial position, results of operations or
cash flows.

In March 2000, the Financial Accounting Standards Board issued FASB
Interpretation No. 44, "Accounting for Certain Transactions Involving Stock
Compensation an Interpretation of APB Opinion No. 25" ("FIN 44"). FIN 44
clarifies the application of APB Opinion No. 25 and, among other issues,
clarifies the following: the definition of an employee for purposes of
applying APB Opinion No. 25; the criteria for determining whether a plan
qualifies as a noncompensatory plan; the accounting consequence of various
modifications to the terms of the previously fixed stock options or awards;
and the accounting for an exchange of stock compensation awards in a business
combination. FIN 44 is effective July 1, 2000, and has been adopted by the
Company.

In April 1998, Statement of Position 98-5, "Reporting on the Costs of Start-up
Activities" ("SOP 98-5") was issued. SOP 98-5 provides guidance on the
financial reporting of start-up costs and organizational costs. It requires
costs of start-up activities and organizational costs to be expensed as
incurred. During 1999, the Company expensed $8,590 of organizational costs
that had previously been capitalized relating to its investment in USAMSA. No
cumulative effect of a change in accounting principle was recognized, however,
due to the immateriality of the amount. If a cumulative effect had been
recognized, accumulated deficit at December 31, 1998 would have been increased
by $8,590.

F-11

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

4. Sales of Accounts Receivable:

The Company sells the majority of its accounts receivable to a financing
company pursuant to the terms of a factoring agreement entered into on
March 30, 1999. According to the terms of the agreement, the receivables
are sold with full recourse and the Company assumes all risks of
collectibility. Accordingly, the Company maintains an allowance for doubtful
accounts receivable based upon the expected collectibility of all trade
receivables. The performance of all obligations and payments to the factoring
company is personally guaranteed by John C. Lawrence, the Company's president
and director. As consideration for Mr. Lawrence's guarantee, the Company
granted a mortgaged security interest to Mr. Lawrence collateralized by the
Company's real and personal property. In addition, Mr. Lawrence was granted
250,000 warrants to purchase common stock of the Company exercisable at $0.25
per share (see Note 14).

The factoring agreement requires that the Company pay 4% of the face amount of
the receivables sold up to $1,200,000, and 2% of the face amount of
receivables sold thereafter as a financing fee. Financing fees paid by the
Company during the year ended December 31, 2000 and 1999 totaled $100,956 and
$106,742, respectively. At December 31, 2000 and 1999, net accounts
receivable of $4,867,093 and $3,909,774, respectively, had been sold under the
agreement. Proceeds from the sales were used to fund inventory purchases and
operating expenses. The agreement is for a term of one year with automatic
renewal for additional one-year terms. The Company's sales of accounts
receivable qualify as sales under the provisions of Statement of Financial
Accounting Standards No. 125, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities."

5. Inventories:

The major components of the Company's inventories at December 31, 2000
and 1999, were as follows:

2000 1999

Antimony Metal $ 32,187 $ 58,365
Antimony Oxide 118,728 206,316
Sodium Antimonate 70,542 11,918
------------ ------------
$ 221,457 $ 276,599
============ ============

At December 31, 2000 and 1999, antimony metal consisted primarily of lots
purchased from foreign suppliers; antimony oxide inventory consisted of
finished product oxide held at the Company's plant or in outside warehouses
throughout the United States; sodium antimonite inventory consisted of dry
finished product and wet raw materials, the majority of which were stored at
the Company's antimony plant near Thompson Falls, Montana.

F-12

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

6. Properties, Plants and Equipment:

The major components of the Company's properties, plants and equipment at
December 31, 2000 and 1999 were as follows:

2000 1999

Gold mill and equipment(1) $ 37,890 $ 37,890
Gold mining equipment (1) 1,265,392 1,265,392
Antimony mining buildings and equipment (2) 168,746 168,746
Antimony mill and equipment(2) 518,190 518,190
Chemical processing and office buildings 256,067 255,447
Chemical processing equipment 887,467 852,811
Other 80,178 76,955
------------ -----------
3,213,930 3,175,431
Less accumulated depreciation 2,967,680 2,834,014
------------ -----------
$ 246,250 $ 341,417
============ ===========

(1) The Company has removed the mill at Yankee Fork and most of the
mining and milling equipment as part of the reclamation process.
Substantially all of the remaining assets are fully depreciated.

(2) At December 31, 2000 and 1999, substantially all of these assets are
fully depreciated and the antimony milling buildings and equipment
are idle.

7. Investment in USAMSA:

In September of 2000, the Company finalized its 50% investment is United
States Antimony, Mexico S.A. de C.V. ("USAMSA").

The company translates the foreign currency financial statements of its
Mexican subsidiary in accordance with the requirements of SFAS No. 52,
"Foreign Currency Translation." Assets and liabilities are translated at
current exchange rates, and related revenues and expenses are translated at
average exchange rates in effect during the period. Unaudited condensed
financial information for USAMSA during 2000 is as follows:

December 31, 2000
ASSETS
Current assets $ 48,908
Noncurrent assets 78,973
-----------
Total assets $ 127,881
===========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities $ 69,359
Stockholders' equity 58,522
-----------
Total liabilities and stockholders' equity $ 127,881
===========

F-13

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

7.Investment in USAMSA, Continued:

For the year ended
December 31, 2000
Revenues:
Income from antimony processing $ 16,145
Processing costs (42,995)
-----------

Gross loss (26,850)
-----------

Other income and (expense):
Administrative and other costs (1,051)
Other income 3,023
-----------

Net loss $ (24,878)
===========

8. Judgment Payable:

At December 31, 2000 and 1999, the Company owed $43,480 and $40,645,
respectively, to the Internal Revenue Service, in connection with a default
judgment in a bankruptcy proceeding.

The default judgment was originally entered against the Company by the United
States Bankruptcy Court in 1992 in favor of the bankruptcy estate of a former
legal counsel of the Company. In 1998, the Trustee of the estate assigned the
interest in the judgment to the Internal Revenue Service. The judgment
accrues interest at the Federal Judgment Interest Rate, which has approximated
6-7%, and is due in monthly installments of $3,000. During 1999 and 2000, the
Company made no payments on this judgment payable.

9. Due to Related Parties:

Amounts due to (from) related parties at December 31, 2000 and 1999 were as
follows (see also Note 17):

2000 1999
Entity owned by John C. Lawrence,
president and director $ (503) $ 788
John C. Lawrence, president and director 10,810 7,340
---------- -----------
$ 10,307 $ 8,128
========== ===========

Transactions affecting the payable to Mr. Lawrence during 2000 and 1999
were as follows:

2000 1999

Balance, beginning of year $ 7,340 $ 2,485
Equipment rental charges 29,709 30,616
Payments (26,239) (25,761)
---------- -----------
Balance, end of year $ 10,810 $ 7,340
========== ===========

F-14

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

10. Notes Payable to Bank:

Notes payable to First State Bank of Thompson Falls, Montana ("First State
Bank") at December 31, 2000 were as follows:

Ten-year term note bearing interest at 10.5%; dated May 5, 2000
payable in monthly installments of $3,384; collateralized by
certain equipment and patented and unpatented mining claims
in Sanders County, Montana; personally guaranteed by John C.
Lawrence (president and director). $ 223,385

Note payable under a $95,000 revolving line-of-credit agreement;
dated December 18, 2000; bearing interest at 11.5%;
collateralized by certain equipment and patented and unpatented
mining claims in Sanders County, Montana; principal and
accrued interest due at maturity on December 15, 2001;
personally guaranteed by John C. Lawrence. 88,257

Note payable under a $60,000 revolving line-of-credit dated
December 26, 2000; bearing interest at 11.5%; collateralized
by certain equipment and patented and unpatented mining claims
in Sanders County, Montana; principal and accrued interest due
at maturity on March 26, 2001; personally guaranteed by
John C. Lawrence. 36,305

Note payable under a $50,000 revolving line-of-credit dated
April 2, 2000; bearing interest at 10.5%; collateralized by
certain equipment and patented and unpatented mining claims
in Sanders County, Montana; principal and accrued interest
due at maturity on April 2, 2001; personally guaranteed by
John C. Lawrence. 8,055
----------

Total 356,002
Less current portion (150,625)
----------
Noncurrent portion $ 205,377
==========

At December 31, 2000, principal payments on the notes payable to bank are due
as follows:

Year Ending
December 31,

2001 $ 150,625
2002 19,993
2003 22,197
2004 24,642
2005 27,358
Thereafter 111,187
-----------
$ 356,002
===========

F-15

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

11. Note Payable to Bobby C. Hamilton:

At December 31, 1999, the Company owed Bobby C. Hamilton ("Hamilton"), an
unsecured note payable of $1,538,381, arising from the settlement of
litigation brought against Hamilton by the Company in 1995. The terms for
repayment of the note included the payment of principal and interest (at 7.5%
per annum) equal to 4% of the gross sales of the Company's operations, with a
minimum total annual payment of principal and interest of $200,000. During
1999, Mr. Hamilton died and the note went into his personal estate (the
"Estate"). In an effort to improve the Company's financial condition, the
Company's management began negotiations during the second quarter of 2000 to
extinguish and settle the debt owed the Estate. As a result of management's
negotiations, the Company entered into a Settlement and Release of All Claims
Agreement (the "Settlement Agreement") with the Estate on June 23, 2000. The
Settlement Agreement extinguished the note payable to the Estate in exchange
for a cash payment of $500,000 and the issuance of 250,000 shares of the
Company's unregistered common stock. The cash payment was financed by the
issuance of $600,000 of convertible debentures (see Note 12) pursuant to a
financing agreement with Thomson Kernaghan & Co., Ltd., a Canadian investment
banker. The Settlement Agreement mutually released both parties from any and
all obligations between them, and included the Company's indemnification of
the Estate against any liabilities and claims that may result from
environmental remediation responsibilities on the Company's Idaho gold
properties.

12. Debentures Payable

Thomson Kernaghan & Co., Ltd.

In connection with the Settlement Agreement between the Company and the Estate
of Bobby C. Hamilton (see Note 11), the Company entered into a financing
agreement (the "Financing Agreement") with Thomson Kernaghan & Co., Ltd.
("TK") on July 11, 2000. The financing agreement provided, among other
things, for the sale of up to $1,500,000 of the Company's convertible
debentures. In July of 2000, the Company sold an initial tranche of $600,000
of convertible debentures and in August sold a second tranche of $75,000
pursuant to the agreement with TK. In connection with the debenture sales and
terms of the Financing Agreement, the Company issued stock purchase warrants
totaling 961,538 to the debenture purchasers' agent (TK) and 432,692 stock
purchase warrants to the debenture purchasers. The exercise price of the agent
and purchaser warrants is the closing bid price as reported by Bloomburg
L.P. on the trading day immediately preceding the July 11, 2000 (The effective
date of the Financing Agreement), or $0.39 per share. The warrants expire in
July and August of 2005.

The Financing Agreement also contained a registration rights agreement in
which Company agreed to register the debenture purchasers' resale of the
shares of common stock issued upon conversion of the debentures and upon
exercise of the related purchasers and agents warrants. For the $675,000 of
debentures issued as of December 31, 2000, the registration rights agreement
requires that the Company register 150% of the conversion shares and 100% of
the underlying agent and purchaser warrant shares. The registration rights
agreement also provides for liquidated damages to be due if the Company fails
to have an effective registration statement filed by the registration deadline
(see Note 18).

The debentures are convertible into common stock at $0.29125 per share or 75%
of the average of the three lowest closing bid prices per share of the
Company's common stock as reported by Bloomburg L.P. in the 20 trading days
immediately preceding the conversion date, whichever is lower. The converting
debenture holder may not, however, own more than 9.9% of the then outstanding
common stock of the Company after the conversion.

F-16

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

12. Debentures Payable, Continued:

The debentures are payable in full at their maturity date on June 30, 2002,
with interest payable at 10% per annum and due annually. At December 31,2000,
$675,000 of convertible debentures had been issued to TK. The Financing
Agreement requires TK to purchase up to $825,000 principal amount of
additional debentures upon the Company's request prior to the June 30,2002
Maturity Date if specified conditions precedent are satisfied, including the
condition that the closing bid price of the Company's stock must exceed
$0.50 per share.

The debentures are transferable, subject to the rules and regulation of the
Securities Act of 1933, and exchangeable for an equal amount of aggregate
principal in different denominations. The debenture agreement requires that so
long as any of the principal of or interest on the debentures remain unpaid or
unconverted, the Company shall not (i) merge or consolidate with any other
entity; (ii) sell or otherwise dispose of a material portion of its assets
(other than in the ordinary course of business); (iii) pay any dividend on its
shares (including any dividend payable in common stock or other property);
(iv) subdivide, split or otherwise increase the number of shares of common
stock; or (v) issue any common stock or other equity securities, or any other
stock, option, warrant, right or other instrument that is convertible into or
exercisable or exchangeable for common stock or other equity securities,
except for (a) securities of a subsidiary that are issued to the Company; and
(b) securities sold and options granted to directors, officers and employees
of the Company pursuant to bona fide employee benefit plans; provided,
however, that the Company may issue such securities enumerated in (v) above,
with the prior written consent of the holders, which consent the holder agrees
not to unreasonably withhold.

Related Parties

During the fourth quarter of 2000, the Company sold $100,000 of convertible
debentures to Al Dugan, a significant shareholder, and $247,992 of convertible
debentures to John C. Lawrence, the Company's president and a director. The
debentures mature three years from the date of issuance and accrue interest at
10%, payable upon each issuance anniversary date. The debentures are
convertible into common stock at $0.31 per share or 75% of the average of the
three lowest closing bid prices per share of the Company's common stock as
reported by Bloomburg L.P. in the 20 trading days immediately preceding the
conversion date, whichever is lower.

The debentures are transferable, exchangeable for an equal amount of aggregate
principal in different denominations, and subject to the same covenants
regarding mergers, dispositions, dividend payments, and stock sales as the
convertible debentures sold pursuant to the financing agreement with Thomas
Kernaghan & Co., Ltd. (above).

In connection with the issuance, Mr. Dugan and Mr. Lawrence, were issued
60,974 and 151,213, respectively, stock purchase warrants. The warrants expire
five years from their date of issue and are exercisable for shares of the
Company's unregistered common stock at $0.41 per share.

The Company accounted for the detachable warrants issued in connection with
the debentures in accordance with Accounting Principles Board Opinion No. 14,
and calculated the fair value attributable to the detachable warrants based
upon the present value of the interest costs of the debentures as compared to
interest costs of the Company's alternative financing sources. The resulting
value was recorded as a discount against the carrying value of the debentures,
and amortized by the straight-line method as interest expense over the terms
of the debentures. During the year ended December 31, 2000, $4,085 of the
debentures payable discount was amortized to interest expense.

F-17

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

12. Debentures Payable, Continued:

At December 31, 2000, debentures payable are as follows:

Amount Maturing

$ 600,000 June, 2002
75,000 August, 2002
50,000 November, 2003
297,992 December, 2003
-----------
1,022,992
(25,543) Less amortized discount
-----------
$ 997,449
===========

13. 2000 Stock Plan

In January of 2000, the Company's Board of Directors resolved to create the
United States Antimony Corporation 2000 Stock Plan ("the Plan"). The purpose
of the Plan is to attract and retain the best available personnel for
positions of substantial responsibility and to provide additional incentive to
employees, directors and consultants of the Company to promote the success of
the Company's business. The maximum number of shares of common stock or
options to purchase common stock that may be issued pursuant to the Plan is
500,000. In connection with the Plan, the Company filed a Form S-8
registration statement with the Securities and Exchange Commission in March of
2000, registering the Plan's shares pursuant to Rule 416-c of the Securities
Act of 1933. At December 31, 2000, 300,000 shares of the Company's common
stock had been issued under the Plan (see Notes 14 and 18).

14. Stockholders' Deficit:

Increase in Authorized Capital

On August 28, 2000, the Company's board of directors resolved to seek
shareholder approval of an amendment of the Company's Articles of
Incorporation to increase the aggregate number of shares of common stock the
Company shall have the authority to issue from 20,000,000 to 30,000,000. The
increase in authorized shares was approved by the Company's shareholders at
the annual meeting of the shareholders on October 31, 2000.

Stock Warrants

The Company's Board of Directors has the authority to issue incentive stock
warrants for the purchase of common stock to directors and employees of the
Company. The Company has also issued warrants in exchange for services
rendered the Company, personal guarantees of financial obligations and the
issuance of debentures.

F-18

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

14. Stockholders' Deficit, Continued:

Transactions in stock warrants are as follows:
Number of Exercise Expiration
Warrants Prices Date
Balance, December 31, 1998 1,094,356 $ 0.25-0.80

Warrants issued to John C.
Lawrence, president and director,
in connection with his personal guarantee
of a financing arrangement 250,000 $ 0.25 (A)

Warrants issued to a stockholder and
consultant as compensation for services 100,000 $ 0.55 (B)

Warrants expired (225,000) $ 0.50-0.70
----------

Balance, December 31, 1999 1,219,356 $ 0.25-0.80
----------

Warrants issued as compensation
for consulting services 300,000 $ 0.25 (C)

Warrants exercised (100,000) $ 0.25

Warrants issued in connection
with issuance of debentures 1,606,417 $ 0.39-0.41 (D)

Warrants issued in connection
with stock sale 48,077 $ 0.39 (E)

Warrants expired (669,356) $ 0.70-0.80
----------

Balance December 31, 2000 2,404,494
==========

(A) Warrants are exercisable for as long as Mr. Lawrence personally
guarantees certain company financing arrangements.
(B) Warrants are exercisable on or before August of 2002.
(C) Warrants are exercisable on or before January of 2003.
(D) 1,394,230 warrants are exercisable on or before July-August of
2005; 212,187 warrants are exercisable on or before November-December
of 2005.
(E) Warrants are exercisable on or before August of 2005.

F-19

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

14. Stockholders' Deficit, Continued:

Issuance of Common Stock to Employees

During 1999, the Company issued 20,000 shares of its unregistered common stock
to employees in recognition of their service to the Company. In connection
with the issue the Company recognized compensation expense of $2,600 based
upon the fair value of the unregistered shares issued.

Issuance of Common Stock in Connection with Conversion of Debts

In June of 2000, the Company issued 250,000 shares of its unregistered common
stock to the Estate of Bobby C. Hamilton (see Note 11) in exchange for the
settlement and extinguishment of the balance of a note payable due the Estate
after the Company's payment of $500,000. In connection with the
extinguishment of the remaining balance due of $958,321, the Company recorded
an extraordinary gain of $917,726 based on the value of the restricted shares
issued at the time.

In November 1999, the Company entered into a Settlement Agreement and Release
of all Claims ("the Agreement") with Ronald Michael Meneo, Trustee of the
Walter L. Maguire 1935-1 Trust ("the Trust") and Walter L. Maguire Sr.,
beneficiary of the Trust and stockholder and former director of the Company.
The Agreement settled litigations brought by the Trust against the Company for
default on certain debentures of the Company held by the Trust and the
resulting counterclaim against the Trust and Mr. Maguire by the Company. The
Agreement called for the issuance of 790,909 shares of the Company's
unregistered common stock to the Trust in exchange for the extinguishment of
all indebtedness claimed owing to the Trust or Mr. Maguire. In connection
with the issuance, the Company extinguished $335,000 of debenture principal
and $347,397 of related accrued interest thereon. The Company recorded an
addition to paid-in-capital (see Note 20.) of $534,101 on the extinguishment
based upon the value of the restricted shares issued at the time.

In October 1999, the Company extinguished a debt due Geosearch, Inc., a former
lessor of a mining interest to the Company, by issuing 245,852 shares of its
unregistered common stock. The debt extinguished totaled $144,339 of principal
and accrued interest. The Company recorded an extraordinary gain of $77,591
on the extinguishment based upon the value of the restricted shares issued at
the time.

Issuance of Common Stock for Cash

During 2000, the Company sold an aggregate of 582,511 shares of its
unregistered common stock and warrants to purchase 48,077 shares of common
stock exercisable at $0.39 per share to Al Dugan and entities affiliated with
him, for cash in the amount of $175,000. Of the shares issued to Mr. Dugan,
100,000 were issued pursuant to the exercise of stock purchase warrants
previously granted him. Mr. Dugan is a significant shareholder of the
Company.

In addition, during 2000, the Company sold 200,000 shares of its unregistered
common stock to an existing shareholder for cash in the amount of $80,000.

F-20

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

14. Stockholders' Deficit, Continued:

Issuance of Common Stock in Exchange for Services

In March 2000, the Company issued an aggregate of 300,000 shares of its common
stock pursuant to its 2000 Stock Plan (see Notes 13 and 18) to two companies
in exchange for financial consulting services provided the Company. In
connection with the issue, the Company recorded $153,000 of compensation
expense based on the Company's estimate of the value of the stock issued and
the services received.

During 1999, the Company issued 40,000 shares of its unregistered common stock
and 100,000 warrants to purchase shares of common stock at $0.55 per share,
exercisable until August 2002, to a consultant in exchange for professional
services rendered to the Company. The shares and related warrants were
recorded based on the value of services rendered.

Issuance of Common Stock Pursuant to Antidilution Provisions

During 2000, the Company issued 35,542 shares of its restricted common stock
to the former holders of Series C preferred stock pursuant to the antidilution
provisions of the Series C preferred shares. In connection with the issue,
the Company recorded an expense of $4,265 based upon management's estimate of
the fair value of the Company's restricted common stock shares when the Series
C holders converted to common stock in 1999. The Company made no adjustments
to its 1999 net loss or accumulated deficit as previously stated, based on the
immateriality of the transaction.

Preferred Stock

The Company's Articles of Incorporation authorize 10,000,000 shares of $.01
par value preferred stock. Subject to amounts of outstanding preferred stock,
additional shares of preferred stock can be issued with such rights and
preferences, including voting rights, as the Board of Directors shall
determine.

During 1986, Series A preferred stock, consisting of 4,500 shares, was
established by the Board of Directors. These shares are nonconvertible,
nonredeemable and are entitled to a $1.00 per share per year cumulative
dividend. Series A preferred stockholders have voting rights for directors
only and a total liquidation preference equal to $45,000 plus dividends in
arrears. At December 31, 2000, 4,500 shares of Series A preferred stock were
outstanding; and cumulative dividends in arrears amounted to $65,250, or
$14.50 per share.

During 1993, Series B preferred stock consisting of 1,666,667 shares, was
established by the Board of Directors and 1,666,667 shares were issued in
connection with the final settlement of litigation. The Series B preferred
stock has preference over the Company's common stock and Series A preferred
stock, has no voting rights (absent default in payment of declared dividends)
and is entitled to cumulative dividends of $.01 per share per year payable if
and when declared by the Board of Directors. In the event of dissolution or
liquidation of the Company, the preferential amount payable to Series B
restricted preferred stockholders is $1.00 per share plus dividends in
arrears. No dividends have been declared or paid with respect to the Series B
preferred stock. In 1995, 916,667 shares of Series B preferred stock were
surrendered to the Company and cancelled in connection with the settlement of
litigation against Bobby C. Hamilton. At December 31, 2000, cumulative
dividends in arrears on the 750,000 outstanding Series B shares were $52,500,
or $0.07 per share.

F-21

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

14. Stockholders' Deficit, Continued:

Preferred Stock, Continued:

During 1997, the Company issued 2,560,762 shares of Series C preferred stock
in connection with the conversion of certain debts owed by the Company. The
rights, preferences, privileges and limitations of the Series C preferred
shares issued upon conversion of debt are set forth below:

Designation. The class of Convertible Preferred Stock, Series C, $0.01 par
value per share, consists of up to 3.8 million shares of the Company.

Optional Conversion. A holder of Series C preferred shares had the right to
convert the Series C shares, at the option of the holder, at any time within
18 months following issuance, into shares of common stock at the ratio of 1:1,
subject to adjustment as provided below. During 1999, holders of 2,354,766
shares of Series C stock converted their shares into common stock of the
Company.

Voting Rights. The holders of Series C preferred shares shall have the right
to that number of votes equal to the number of shares of common stock issuable
upon conversion of such Series C preferred shares.

Liquidation Preference. In the event of any liquidation or winding up of the
Company, the holders of Series C preferred shares shall be entitled to receive
as a preference over the holders of common stock an amount per share equal to
$0.55, subject to the preferences of the holders of the Company's outstanding
Series A and Series B preferred stock.

Registration Rights. Twenty percent (20%) of the underlying common stock
issued upon conversion of the Series C preferred shares shall be entitled to
"piggyback" registration rights when, and if, the Company files a registration
statement for its securities or the securities of any other stockholder.
These shares are included in a registration statement currently being filed
with the Securities and Exchange Commission.

Redemption. The Series C preferred shares are not redeemable by the
Company.

Antidilution Provisions. The conversion price of the Series C shares was
subject to adjustment to prevent dilution in the event that the Company issued
additional shares at a purchase price less than the applicable conversion
price (other than shares issued to employees, consultants and directors
pursuant to plans and arrangements approved by the Board of Directors, and
securities issued to lending or leasing institutions approved by the Board of
Directors). Accordingly, the conversion price was adjusted according to a
weighted-average formula, resulting in the issuance (in 2000) of an additional
35,542 shares of common stock to Series C holders who exercised their
conversion rights in 1999. The initial conversion price for the Series C
shares was $0.55 and was subsequently adjusted to $0.54 per share based on the
antidilution formula.

Protective Provisions. The consent of a majority interest of the holders of
Series C preferred shares shall be required for any action which (i) alters or
changes the rights, preferences or privileges of the Series C shares
materially and adversely; or (ii) creates any new class of shares having
preference over or being on a parity with the Series C shares.

F-22

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

14. Stockholders' Deficit, Continued:

During 2000, the Company converted 28,092 of shares of Series C preferred
stock into an equal number of common shares for a Series C preferred
stockholder that had timely noticed the Company of its desire to convert its
Series C shares during 1999. At December 31, 2000, 177,904 shares of Series C
preferred stock remained outstanding and unconverted.

15. Income Taxes:

At December 31, 2000 and 1999, the Company had net deferred tax assets of
approximately $1,900,000 and $2,700,000, respectively. The deferred tax
assets principally arise from net operating loss carryforwards for income tax
purposes. As management of the Company cannot determine if it is more likely
than not that the Company will realize the benefit of its deferred tax
assets, a valuation allowance equal to the net deferred tax assets at both
December 31, 2000 and 1999 has been established.

At December 31, 2000, the Company had regular tax net operating loss
carryforwards of approximately $5,300,000, which expire in the years 2001
through 2020, with the majority of the carryforwards expiring in 2001 through
2003. At December 31, 2000, the Company had net operating loss carryforwards
for alternative minimum tax purposes of approximately $4,900,000.

16. Loss Per Common Share:

The following table presents a reconciliation of the numerators and
denominators of the basic and diluted earnings per share ("EPS") computations
for the year ended December 31, 1999:
Per Share
Loss Shares Amounts

Basic EPS:
Net loss before extraordinary item $ (307,677) 14,597,927 $ (0.02)
Common stock warrants (1)
Series C preferred stock (2) 241,528 Nil
----------- ---------- ---------
Diluted EPS:
Net loss before extraordinary item $ (307,677) 14,839,455 $ (0.02)
=========== ========== =========

(1) Common stock warrants totaling 1,219,356 outstanding during 1999
were not included in the computation of diluted EPS at December 31,
1999, because the various exercise prices of the warrants were greater
than the average market price of the Company's common stock.

(2) Series C preferred stock was convertible into common stock of the
Company on a share-for-share basis. The effect on the computation of
diluted weighted average shares outstanding is based upon the potential
conversion of the shares into common stock for the period of time the
preferred shares were outstanding and the effect of Series C preferred
stock antidilution provisions.

F-23

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

17. Related-Party Transactions:

In addition to transactions described in Notes 4, 7, 9, 10, 12, and 14 during
2000 and 1999, the Company had the following transactions with related
parties:

- During 2000 and 1999, the Company issued 79,167 and 18,000,
respectively, shares of its unregistered common stock to members
of the Board of Directors for their duties as directors. The issuances
have been recorded in the consolidated financial statements as if they
were issued in the year they were earned. The stock awards were recorded
as compensation expense (director's fees) based upon the estimated value
of the stock at the date of issuance.

- In February 1999, the Board of Directors nominated Leo Jackson to
serve as a director. Mr. Jackson is a stockholder of the Company
and owns 31.4% of Production Minerals Inc.,which has an indirect
interest of 25% in the stock of USAMSA (see Note 7).

18. 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 requiring cleanup of the cyanide solution. The Company has
been reclaiming the property; and, as of December 31, 2000, the cyanide
solution cleanup was complete, the mill removed, and a majority of the cyanide
leach residue disposed of. 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, which the Company
signed in December 1996. The Company also has environmental remediation
obligations at its antimony production facility near Thompson Falls, Montana
and its former gold mining property (Yellow Jacket) in Lemhi County, Idaho.

The Company's management believes that USAC is currently in substantial
compliance with environmental regulatory agencies and that its accrued
environmental reclamation costs are representative of management's estimate of
costs required to fulfill its reclamation obligations. 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. Such costs are accrued at the time the expenditure becomes
probable and the costs can reasonably be estimated.

F-24

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

18. Commitments and Contingencies, Continued:

During the first quarter of 2000, the Company issued 150,000 shares of its
common stock to Thomson Kernaghan & Co., Ltd., and 150,000 shares of its
common stock to Blue Water Partners, Inc. as compensation for fiscal
advisory and consulting services to be provided the Company. The shares
were issued pursuant to the Company's 2000 Stock Plan (see Note 13), and
were believed by the Company to be registered under a Form S-8 registration
statement filed in connection with the 2000 Stock Plan. The stock
certificates issued to the two companies therefore did not bear a restrictive
legend. Subsequent to the issuance of the shares, management was informed
by its legal counsel that Form S-8 cannot be used to register stock issued
to consultants whose services involve promotion of the Company's stock. In
response to this information, management immediately contacted both companies
and requested that the unlegended shares of common stock be returned to the
Company in exchange for a certificate bearing a restrictive legend. In March
of 2001, Thomson Kernaghan & Co., Ltd. returned 150,000 shares to the Company
in exchange for 150,000 restricted shares. No response has been received
from Blue Water Partners, Inc. As a result of the issuance, the Company may
be subject to civil liabilities, including fines and other penalties imposed
by federal and state securities agencies. At December 31, 2000, the Company
had not recorded any liability associated with the issuance of these shares,
as management believes the likelihood of a claim and the ultimate outcome if
a claim is asserted cannot be ascertained at this time.

In July of 2000, the Company entered into a financing agreement with Thomson
Kernaghan & Co., Ltd. (see Note 12). The financing agreement provided, among
other things, for the sale of up to $1,500,000 of the Company's convertible
debentures. The Financing Agreement also contained a registration rights
agreement in which Company agreed to register the debenture purchasers' resale
of the shares of common stock issued upon conversion of the debentures and
upon exercise of the related purchasers and agents warrants. The registration
rights agreement also provides for liquidated damages to be due if the Company
fails to have an effective registration statement filed by the registration
deadline. The liquidated damages are calculated as two percent (2%) per month
of the aggregate value of the principal amount of the debentures outstanding
combined with the aggregate exercise prices of the outstanding purchasers' and
agent's warrants issued in connection with the convertible debentures, accrued
on a daily basis subsequent to the registration deadline. At December 31,
2000, the Company did not have a registration statement yet effective, and the
registration deadline had past. The Company has not accrued any liability
associated with liquidated damages that may be due (of approximately $38,000
for the period from the registration deadline to December 31, 2000) as of
December 31, 2000, as the Company's management and its legal counsel believes
that while it is reasonably possible that Thomson Kernaghan & Co., Ltd. will
assert a liquidated damages claim against the Company, it is most likely not
probable, based upon the circumstances surrounding the late registration
filing and other factors.

F-25

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

19. Fair Value of Financial Instruments:

The following disclosure of the estimated fair value of financial instruments
is made in accordance with the requirements of Statement of Financial
Accounting Standards No. 107, "Disclosures about Fair Value of Financial
Instruments." The estimated fair value amounts have been determined using
available market information and appropriate valuation methodologies. However,
considerable judgment is required to interpret market data and to develop the
estimates of fair value. Accordingly, the estimates presented herein are not
necessarily indicative of the amounts the Company could realize in a current
market exchange.

The carrying amounts for cash, restricted cash, accounts receivable, accounts
payable and accrued expenses are a reasonable estimate of their fair values.
The fair value of amounts due to related parties approximate their carrying
values of $10,307 and $8,128, respectively, at December 31, 2000 and December
31, 1999, based upon the contractual cash flow requirements.

Judgments payable of $43,480 and $40,645, at December 31, 2000 and 1999,
respectively, approximate their carrying value based upon the judgment's
repayment requirements. The fair value of the Company's convertible
debentures and accrued interest of $997,449 and $47,324, respectively, at
December 31, 2000, approximate their carrying value based on management's
estimate the fair values of comparable debt instruments.
F-26

United States Antimony Corporation and Subsidiaries
Notes to Consolidated Financial Statements, Continued:

20. Restatement:

As discussed in Note 14, in 1999 the Company settled litigations brought by a
trust associated with a former director of the Company. As a result of the
settlement, the Company issued 790,909 shares of its unregistered common stock
to the trust in exchange for the extinguishment of $682,397 of indebtedness
claimed owing to the trust. The Company recorded the transaction by
recognizing an extraordinary gain of $534,101 on the extinguishment based upon
the value of the restricted shares issued at the time.

In connection with the filing of a registration statement with the Securities
and Exchange Commission ("the Commission") begun in 2000, the Commission
commented that if the trust was a related party to the Company, the
transaction may in essence be a capital transaction and should be classified
as a credit to additional paid-in capital versus an extraordinary item.
Although the Company believes the trust was not a related party as defined by
generally accepted accounting principles, the Company agreed to restate the
1999 financial statements to reflect the extinguishment as an addition to
additional paid-in-capital in an effort to facilitate the effectiveness of the
registration statement.

The restatement has no effect on total stockholders' deficit or net loss from
operations as previously reported, the effects on accumulated deficit,
additional paid-in-capital, extraordinary gain on conversion of debt to common
stock, and net loss are illustrated as follows:

As previously
reported As restated

Additional paid-in capital $ 14,289,947 $ 14,824,048
Accumulated deficit (16,651,750) (17,185,851)
------------ ------------
Total stockholders' deficit (2,183,195) (2,183,195)
------------ ------------
Total liabilities and stockholders' deficit $ 968,522 $ 968,522
============ ============

Loss before extraordinary item (307,677) (307,677)
Extraordinary gain on conversion of debts
to common stock 611,692 77,591
------------ ------------

Net income (loss) $ 304,015 $ (230,086)
============ ============

Basic and diluted net income (loss)
per share of common stock
Before extraordinary item $ (0.02) $ (0.02)
Extraordinary item 0.04 Nil
------------ ------------
Net income (loss) $ 0.02 $ (0.02)
============ ============

F-27