PAGE 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
/X/ Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 [Fee Required]
For the fiscal year ended December 31, 1995
or
/ / Transition report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 [No Fee Required]
For the Transition period from to
------------ -------------
Commission File No. 0-1764
AMERICAN NUCLEAR CORPORATION
----------------------------
(Exact Name of Registrant as Specified In Its Charter)
Colorado 83-0178547
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P.O. Box 2713 82602
Casper, Wyoming
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(307) 265-7912
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
- ------------------- ---------------------
None ----
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, 4 cent par value
------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 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 .
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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not 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-K or any amendment to
this Form 10-K. /X/
Based upon the bid prices of the common stock on January 31, 1995 of $0.001
per share, the aggregate market value of the voting stock held on that date by
non-affiliates of the registrant was $7,677.
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of December 31, 1995: 4 cent par value - 7,696,739
This report consists of 43 pages, including 2 pages constituting the cover
page.
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PART I
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Item 1. Business.
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Discontinuance of Operations
The Company's uranium mining and milling activities were discontinued in
1982 as a result of the depressed market price for uranium concentrate.
Thereafter the Company offered its inactive mill tailings ponds as locations
for the disposal and reclamation of large amounts of mill tailings previously
generated by another uranium producer. Those efforts over several years did
not result in awards of disposal contracts to the Company. In 1984 the
Company began reclamation of its milling site, as required by federal and
state law. In 1988, the Company decommissioned its uranium mill and began
reclamation of the mill and the associated milling site.
In 1990 the Company shifted its efforts from uranium, for which the
market price remained depressed, to the new and developing industry of
byproduct material disposal for various uranium ore processors. The Company
fulfilled several such disposal contracts between 1990 and 1993.
After extensive marketing efforts, it became apparent that the byproduct
disposal business would not produce revenues adequate to sustain the
Company's operations unless it raised adequate capital for expanding the
byproduct disposal business into commercial byproduct disposal. The
Company's efforts in 1992 and 1993 to raise additional capital from investors
were not successful. Starting in 1993, the Company advertised its mining
properties for sale to raise funds through a sale of its principal asset, the
Peach mining properties.
The Company's efforts to sell its mining properties in 1993 and early
1994, were not successful. While potential purchasers continued to express
interest through early 1994, the Company did not receive any offer greater
than the amount of the debt due to Cycle Resource Investment Corporation
(CRIC) that is secured by a mortgage against the properties. Inability to
sell the mining properties, lack of capital, and lack of revenues from both
its uranium properties and its byproduct disposal business deprived the
Company of operating capital. The mining properties were the only major
asset of the Company, and selling them to raise working capital was the
Company's only remaining means to stay in business. The Company determined
to discontinue business operations during May 1994, to liquidate its
miscellaneous property, and to pay a portion of its current liabilities and
other expenses associated with an orderly closing of business operations.
Marketability of Common Stock
Effective May 9, 1994, the Company's common stock was delisted and
removed from the NASDAQ Small Cap Market. There is no regular trading market
for the Company's common stock. Isolated trades may occur on the electronic
bulletin board.
Development of Business Before Discontinuance in 1994
American Nuclear Corporation, the Company, was incorporated in 1955 as
one of the first uranium exploration companies formed after the commercial
importance of uranium as a source of energy and fuel was realized. The
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Company acquired uranium mining properties by locating mining claims and
purchasing other mining claims.
Uranium Mining for Atomic Energy Commission and Others
Starting in 1959 the Company was engaged, with its partner, Federal
Resources Corporation, in mining and milling uranium concentrates in the Gas
Hills area in central Wyoming for sale to the U.S. Atomic Energy Commission
and various utilities that supply electricity. The mining was conducted by
open pit surface mining. The mill was also operated on a custom basis to
mill uranium ores for other uranium producers. The Atomic Energy Commission
discontinued purchases in 1971 when its inventory goals and strategic plans
were met and a United States uranium industry had been created. The
partnership continued to operate its mill for producing its own properties
and custom milling of uranium ores for other producers for sales to
commercial users.
Expansion of Uranium Industry in the 1970's
The modern uranium industry was shaped in the 1970s in response to growth
in nuclear power generation by utilities. The embargoes of imports of
foreign oil in the early 1970s caused an energy crisis in the United States
and resulted in increased construction of nuclear power plants and plans for
more plants. Demand for uranium increased significantly from spot prices for
short-term deliveries of less than $10 per pound of uranium concentrate in
1971 to more than $40 per pound by 1978.
Tennessee Valley Authority Agreements
In 1972 the Company entered into an arrangement with the Tennessee Valley
Authority (TVA), an agency wholly owned by the United States, for the joint
acquisition of uranium properties to be produced for use by TVA to fuel its
nuclear power plants. In 1973 Federal American Partners leased its mining
properties to TVA. From 1979 through 1982, the partnership mined its
properties and milled its ores for TVA. In the late 1970's annual production
reached a level of 1.2 million pounds of uranium concentrates per year. TVA
discontinued the operations in 1982 because world-wide production of uranium
concentrates exceeded demand and it cost less to purchase from inventoried
uranium stocks than to mine and mill. A total of 14.5 million pounds of
uranium concentrates had been produced through the mill over its operating
life.
Termination of Tennessee Valley Authority Agreements
In 1984 the Company acquired the uranium mill and associated lands from
the partnership, and it also acquired approximately one-half of the uranium
lands it had jointly held and explored with TVA. These lands, consisting of
approximately 2,700 acres of uranium properties, are known as the Peach
properties. In May 1994 when the Company discontinued business, the Peach
properties were the Company's only principal asset. They were subject to a
mortgage held by Cycle Resource Investment Corporation (CRIC), which acquired
them through foreclosure. Please see Item 7, "Liquidity and Capital
Resources" section of this report for more detail.
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In 1984 TVA also placed approximately $3.8 million cash in a $4.1 million
reclamation bond fund with the Wyoming Department of Environmental Quality
(DEQ) to assure the DEQ and the U.S. Nuclear Regulatory Commission (NRC) that
the reclamation obligations of TVA, the Company and the partnership for the
mill site would ultimately be performed. The Company began reclamation of
the land at the mill site in 1984. TVA also entered into a management
agreement with the Company under which, in exchange for management fees, the
Company closed the mining operations, returned leased mining equipment, and
sold the other mining equipment for TVA's account. The Company's entire
financial obligation to TVA for the Company's cost of acquiring and exploring
its interests in the uranium properties was eliminated.
Status of Uranium Business
Since the Tennessee Valley Authority terminated its mining activities in
1982 that were conducted through the Company's partnership called Federal
American Partners, the Company has not been engaged in mining or milling
uranium. The Company identified significant quantities of uranium resources
in the ground among its uranium properties, but market prices have never been
adequate to enable the properties to be economically mined. The market for
uranium remains low at this time, and it would still not be economically
feasible to mine the Company's uranium properties at current prices.
Imports of foreign uranium at low prices, especially from Russia and Canada,
and excess inventories of uranium were the primary factors that dampened
prices to a low of approximately $7.15 per pound in 1991. In 1993 and 1994,
spot prices for short-term deliveries of uranium were approximately $9.50 per
pound. In efforts to generate working capital, the Company, during the
fourth quarter of 1993, offered its mineral properties for sale. No purchase
offers that exceeded the CRIC debt against the properties were received.
Therefore, in May 1994 the Company was forced to discontinue all its business
operations due to lack of operating capital. For a more complete discussion
of the uranium properties, see Item 2, Properties.
Reclamation of Mill Site and Tailings Ponds
Based upon the Company's determination that use in the future of its
uranium processing mill would not comply with the revised licensing
requirements of the NRC, the Company began demolition of the mill in 1988 and
completed that work in 1989. Before the Company's discontinuance of
operations in 1994, the Company had undertaken substantial reclamation work
on the mill site as required by the NRC and the DEQ. The mill and
associated buildings were dismantled and the building materials were buried
in one of the two adjacent tailings ponds where the processed ores produced
by the mill (mill tailings) were impounded after milling. The mill tailings
in the two impoundments were graded by earth moving equipment into mounds
covering approximately 40 and 80 acres respectively. A cover of native earth
was placed over the mounds of mill tailings, and the tailings piles were
allowed to settle and compact naturally. The reclamation work still required
consists of filling and shaping the side slopes of the tailings piles to such
a grade as to preclude erosion of the soil cover that would allow erosion of
the tailings, placing a final cover of earth over the tailings to limit
emission of radon gas into the atmosphere to meet Environmental Protection
Agency (EPA) standards, applying erosion protection in the associated
drainages, and revegetating and fencing the site.
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Byproduct Material Disposal
Starting in 1990 the Company shifted most of its efforts to a new,
developing industry of byproduct material disposal. The byproduct material
consists of waste generated from ores processed by others for their uranium
or thorium content. Federal regulations require the generators of these low
level radioactive materials to dispose of them in licensed depositories.
In part because the Company's mill site was undergoing reclamation work
to stabilize the mill tailings, which are low level radioactive materials,
the NRC initially granted permission in the fall of 1990 for the Company to
accept byproduct materials totaling 1,100 cubic yards from four generators
under four specific waste disposal contracts. After the NRC authorized
receipt of the initial byproduct material, the NRC amended the Company's
license in September of 1991 to authorize it to receive and dispose of an
additional 12,500 cubic yards of material from other sources.
The material terms of the disposal contracts that were completed by the
Company required the generator of the byproduct materials to deliver them to
the Company's mill site. The byproduct material was placed on the surface of
the mill tailings impoundment number 1, compacted and covered with an interim
cover of native soils. The addition of the byproduct materials reduced the
volume of earthen fill material that must be placed on the mill tailings to
meet the reclamation design requirements.
The income received on account of past disposal contracts generated
revenues for the Company of $322,624, $318,814, and $120,352 from operations
in 1993, 1992, and 1991, respectively. These contracts were completed, and
there were no disposal revenues in 1994 or 1995. Byproduct material disposal
was terminated when the company discontinued business operations in May 1994.
During May 1994 the Company notified the NRC and the DEQ that it was
discontinuing all business operations and would be unable to perform under the
approved reclamation plan. All byproduct disposal activities, which had been
conducted as part of the approved reclamation work, were discontinued at that
time.
Abandonment of Efforts to License Commercial Byproduct Disposal
During 1993 the Company abandoned its efforts to obtain new licenses from
the NRC and DEQ to establish a commercial byproduct disposal business near its
mill site that was undergoing reclamation. In order to complete the
environmental studies required for the new licenses, continue to pursue its
license applications, and take other steps for opening such a business, the
Company sought to raise $5 million to $8 million through private placements of
its common stock. When this effort proved unsuccessful in 1993, the Company
terminated further efforts to enter the commercial byproduct disposal
business.
Termination of Byproduct Disposal and Discontinuance of Business
The Company did not realize adequate revenues from its byproduct disposal
business commenced in 1990 to fund its operations. Since 1991 the Company
relied for a large part of its operating capital upon loans by Cycle Resource
Investment Corporation (CRIC), holder of approximately 30 percent of the
PAGE 7
Company's outstanding stock. The Company was unable to obtain additional
loans from CRIC or any other source after 1993. The Company's efforts to
raise capital by placement of its common stock were unsuccessful. The
Company was not able to obtain joint ventures or long term supply contracts
for exploitation of its uranium properties in the future when market prices
for uranium were expected to be higher.
In efforts to repay its loan to CRIC and to raise additional capital to
continue its reclamation work over the next several years as required by law,
the Company in 1993 offered its uranium properties for sale. Through May
1994, several prospective buyers expressed interest in purchasing the uranium
properties, but no purchase offers were received that were greater than the
CRIC debt. The uranium properties could not be sold under those
circumstances.
Due to the lack of a sale of its uranium properties and limited operating
capital, the Company was forced to discontinue all business operations during
May 1994. At the time the Company discontinued business operations, it was
unable to continue required reclamation work at the level required by law.
The DEQ declared the Company in default of its reclamation obligations and
began reclamation bond forfeiture proceedings against the Company. These
proceedings resulted in forfeiture of the bond fund of $3,213,255 to the
State of Wyoming in October 1994. The Company has continued to monitor the
reclamation site, as ordered by the NRC. The Company expects that
reclamation of the mill site will ultimately be performed by the DEQ if it is
able to reach agreement with the NRC as to the extent of reclamation still
required. The state of Wyoming has indicated that it would assume the NRC
license obligations under certain conditions that limit its ultimate
liability, but there are no assurances the state will reach agreement with
the NRC. The Company will continue to be the licensee and responsible for
all NRC license requirements and reclamation obligations. By statute the DEQ
may recover from the company any reclamation costs incurred by the DEQ in
excess of the bond. The total reclamation cost for which the Company remains
obligated will not be known for several years.
Financial Information About Industry Segments
In 1991 the Company entered into the business of uranium byproduct
material disposal. Between 1982 and that time, the Company's only business
was winding down its former mining operations with the partnership and TVA,
its reclamation activities, and the maintenance of its uranium properties
with the intent of eventually producing uranium concentrate. See Note 1 to
the financial statements included in Item 14 of this report.
Before it discontinued its business operations in May 1994, the Company
had no foreign operations or export sales. It had not segregated its
business activities into geographic areas within the United States except to
the extent that its operations were located within Wyoming.
Potential Unasserted Reclamation Liabilities
The Company's reclamation work and its discontinued byproduct materials
disposal business activities were and are highly regulated by the NRC and
DEQ, which have licensing authority and jurisdiction. Even though the
Company
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discontinued its business operations in May 1994, it remains liable for the
cost of any reclamation work that is not funded by the bond fund.
The Company's reclamation fund of approximately $3,213,255 was declared
forfeited by the Wyoming DEQ and acquired by the DEQ to cover the reclamation
costs of the mill site. The bond fund was funded in the full amount fixed by
the NRC and the DEQ as the entire cost of completing the required reclamation
work and performing under the Company's licenses. There is a risk that the
reclamation requirements may be increased and that the amount required to
perform the reclamation under such new requirements may increase. By law,
the Company is liable for any cost overruns, none of which exist at this
time, but which are possible.
Employees
As of December 31, 1995, the Company had no employees.
Item 2. Properties
During 1995 the Company lost its remaining uranium properties, called
the Peach properties, through foreclosure by CRIC on a $2,031,200 loan. These
properties consisted of unpatented mining claims located on the public domain
of the United States in the Gas Hills area of central Wyoming.
NUKEM, Inc. owns 100 percent of CRIC which in turn owns 30% of the
Company's common stock. NUKEM, Inc. is a New York corporation located in
Stamford, Connecticut, that is a wholly owned subsidiary of NUKEM, GmbH, a
German corporation located in Alzenau, Germany that in turn is a wholly owned
subsidiary of RWE AG, a German corporation. RWE is publicly held, and is the
largest electric generating utility in Germany and the eighth largest in the
world. It is also a worldwide conglomerate active in the production and
marketing of petroleum products, coal, uranium, chemicals, and electrical
generating equipment. RWE also is active in waste processing and
environmental protection and reclamation services.
Sweetwater Uranium Properties
The Sweetwater uranium properties were abandoned during August 1994 due
to the Company's inability to pay the $100 per claim annual rental fee
required by the Department of Interior, Bureau of Land Management.
Other Gas Hills Uranium Properties
The Company has either sold or abandoned by non-payment of the annual
rental fee its varying undivided interests, ranging from 13% to 100%
undivided interests as tenants in common, in unpatented mining claims
covering approximately 3,100 acres in the Gas Hills area near the Peach and
Sweetwater properties.
Mining Claim Rental Fees
According to a federal law adopted in 1992, in order to maintain title to
mining claims after their location, an owner must pay annual rental fees of
PAGE 9
$100 per claim to the Department of the Interior. Upon failure to pay the
rental fee, the Bureau of Land Management declares the claim void and
terminated.
Market for Uranium
The ultimate cause of the Company's inability to stay in business was the
sharp decline in the market price for uranium that has persisted since 1981.
Most of the former uranium producers in the United States have suspended
operations because of the current low market price of uranium. The current
market for sales of uranium is being filled in large part by inventories of
domestic concentrates and imported foreign concentrates.
The principal market for uranium concentrates consists of utility
companies throughout the United States and other countries. The principal
market for lands containing uranium that has not been mined, non-producing
uranium properties, primarily consists of other mining companies, foreign
utilities, and to a lesser extent, utility companies throughout the United
States. Some of the utility companies purchase non-producing properties to
assure themselves of a supply of uranium for their nuclear reactors.
Marketing of non-producing uranium properties as well as uranium
concentrates occurs through privately negotiated contracts, by open bid, or
both. Uranium brokers may seek buyers and sellers of either uranium
properties or concentrates for a commission. There are only a few brokers
internationally that list uranium properties for sale, and the Company
maintained contact with them although its properties were not listed through
them for sale. There are only a few sales of uranium properties every
several years, and each sale is unique.
The Company offered its properties for sale during 1993 and was unable
to sell them by May 1994, thus forcing the Company to discontinue operations
due to lack of operating capital. Please see Item 7, "Liquidity and Capital
Resources," in this report for additional details.
Item 3. Legal Proceedings.
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There are no legal proceedings pending against the Company or its
properties.
Item 4. Submission of Matters to a Vote of Security
Holders.
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No matters for decision were submitted to a vote of shareholders during
the last calendar quarter of the year ended December 31, 1995.
PART II
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Item 5. Market For Registrant's Common Equity and Related
Stockholder Matters.
Through January 1994 the common stock of the Company was traded
over-the-counter on the NASDAQ national market system. Effective February 1,
1994 the Company's common stock began trading on the NASDAQ small cap market
PAGE 10
under the symbol ANUC. Effective May 9, 1994 the Company's common stock was
delisted and removed from the NASDAQ small cap market. Trades between market
makers may occur on the over the counter bulletin board. The range of high
and low sales prices of the stock for each calendar quarter period during the
past three years through May 9, 1994, as quoted by NASDAQ, are given in the
following table. The over-the-counter market quotations reflect inter-dealer
prices, without retail mark-up, mark-down, or commission, and may not
necessarily represent actual transactions.
Price Ranges (closing bid)
For Calendar Years Ended December 31
----------------------------------------
1995 1994 1993
------ ------ ------
Low High Low High Low High
---- ---- ---- ---- ---- ----
First Quarter ..... .001 .001 0.12 0.25 0.50 1.09
Second Quarter ..... .001 .001 0.09 0.15 0.50 1.00
Third Quarter ..... .001 .001 0.001 0.001 0.12 0.66
Fourth Quarter ..... .001 .001 0.001 0.001 0.12 0.31
<FN>
<F1> (a) The low and high prices for the stock on January 31, 1996 were
$.001 and $.001.
<F2> (b) Based solely upon the number of record holders, the approximate
number of stockholders of the common stock of the Company as of January 31,
1996 was 1716.
<F3> (c) No dividends have been declared with respect to the common stock
during the fiscal years ended December 31, 1995, 1994 and 1993.
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Item 6. Selected Financial Data.
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Seven Fiscal
Year Year Year Year Months Year
Ended Ended Ended Ended Ended Ended
December December December December December May
31,1995 31,1994 31,1993 31,1992 31,1991 31,1991
(Unaudited)(Unaudited)
-------- -------- -------- -------- -------- --------
($000's are omitted except per share amounts)
INCOME STATEMENT
Revenue From
Discontinued
Operations $ -0- $ -0- $ 323 $ 319 $ 120 $ -0-
Net Income (Loss) $ 386 $(4,991) $(4,074) $ (381) $(3,595) $ (365)
BALANCE SHEET
Working Capital(1) $ (62) $ (391) $(2,214) $(1,590) $ (739) $ (306)
Total Assets $ 218 $ 72 $ 9,845 $13,413 $12,874 $15,784
Total Liabilities $ 167 $ 406 $ 5,189 $ 4,683 $ 3,784 $ 3,619
Long-Term
Obligations $ -0- $ -0- $ 2,786 $ 2,913 $ 2,967 $ 3,267
Common Stockholders'
Equity (Deficit) $ 51 $ (335) $ 4,656 $ 8,730 $ 9,090 $12,166
LOSS PER COMMON
SHARE(2)
Income (loss) from
Operations $ .05 $ (0.65) $ (0.53) $ (0.05) $ (0.47) $ (0.05)
Dividends Paid Per
Common Share $ -0- $ -0- $ -0- $ -0- $ -0- $ -0-
- ------------------------------
<FN>
<F1> (1) Exclusive of assets held for sale.
<F2> (2) The weighted average number of shares of common stock outstanding
during the year ended December 31, 1995, 1994, 1993 and 1992, and the seven
months ended December 31, 1991, and the fiscal year ended May 31, 1991 was
7,696,739, 7,696,739, 7,696,622, 7,693,736, 7,573,405, and 7,239,125
respectively.
</FN>
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
- ------ -----------------------------------
(See, in addition to Selected Financial Data, the financial statements of
the Company referred to in Item 14)
PAGE 12
Discontinuation of Operations
The Company's efforts to sell its mining properties, starting in 1993,
were unsuccessful, preventing it from raising operating capital necessary to
continue in business. As a result, the Company discontinued business
operations in May 1994. Inability to sell its properties and lack of capital
and revenues deprived the Company of operating capital. The Company
determined to discontinue operations during May 1994 and to liquidate its
miscellaneous property and to pay a portion of its current liabilities and
other expenses associated with an orderly closing of business operations.
These financial statements have been prepared on a liquidation basis.
Results of Operations
During 1995 the Company continued to monitor the reclamation site in
accordance with NRC and Wyoming DEQ regulations. The funds were provided
primarily through prepayments made during 1994.
During 1995 the Company applied, under the Title X federal program
administered by the U.S. Department of Energy (DOE), for reimbursement of
some of the expenses of reclamation work it has previously performed to clean
up its mining and milling site. The Company's claim was for approximately
$687,000 of which the first of three equal annual payments was made during
1995. Under the prevailing law, as understood by the Company, and under the
terms of the order of the U.S. Nuclear Regulatory Commission that directs the
Company to continue to reclaim and monitor the site, the funds, and any
future funds that may be received under this program, will be applied to
ongoing monitoring and maintenance obligations over the next several years,
including payments to the Company's independent contractors to perform such
services. None of the money will be applied to claims of creditors, and no
funds will be available for distribution to shareholders because the
reclamation obligations are projected to exceed any of those funds that
become available. The DEQ has notified the Company that the reclamation bond
may be deficient by as much as $3 million. The DEQ has statutory authority
to sue the Company for the bond deficiency, and the DEQ has said it will
bring such a deficiency suit if the Company does not transfer the Title X
funds to the state to be applied to the deficiency and used by the state to
perform reclamation. The Tennessee Valley Authority (TVA) has asserted a
right to the funds based on its 1984 contract with the Company. TVA, under
the dispute procedures of the 1984 contract, has determined that it is
entitled to the funds. Enforcement of such a claim by TVA or other unsecured
general creditors would be contrary to the NRC order to the Company that
controls use of its funds, and the Company expects to resist claims by TVA
and other such creditors. If litigation does occur, the Company might file
for dissolution under bankruptcy law, after which the bankruptcy court would
control use and distribution of any reclamation funds that might have been
received. Upon bankruptcy or any other dissolution, the Company would cease
to be able to hold the NRC license and would thereupon become ineligible to
obtain any additional reimbursements of Title X reclamation funds under the
DOE program.
During 1995 CRIC foreclosed upon the Peach properties for the amount of
its $2,031,200 loan plus interest in the total amount of approximately
$2,750.000.
PAGE 13
During the prior four years, the Company shifted its efforts away from
the holding of uranium properties, because of the continuing low level of
uranium market prices, to a newly developing market of byproduct material
disposal. It was the Company's intent to make the byproduct disposal
business its primary business, but that effort was unsuccessful. The Company
was forced to discontinue operations during May 1994 due to lack of operating
capital.
During the years ended December 31, 1995, 1994 and 1993, the Company
entered the business of uranium byproduct material disposal and received $-0-,
$-0-, and $323,000 respectively for performing on five contracts for disposal
of uranium byproduct material at its mill site. The Company was not
successful in entering into any such disposal contracts during 1994. During
September 1993 the Company entered into a marketing agreement with American
Ecology Corporation (AEC) by which AEC would assist the Company in obtaining
byproduct disposal contracts for the disposal of 10,000 cubic yards of
material. AEC made a $202,500 advance payment to the Company which was to be
recovered by it either through one-half of net disposal revenue or the
issuance of the Company's common stock at the average of the previous sixty
days trading price. The Company was to retain 50% of the net profits
generated from disposal revenue. AEC had not entered into any disposal
contracts prior to the Company's discontinuance of operations during May
1994, and is not entitled to repayment. Accordingly, this payment was
recognized as revenue during 1995.
The Company entered into a multi-year material disposal contract with
Ferret Exploration Company (Ferret). The Contract provided for annual
advance disposal payments of $16,500. The Company's license allowing the
disposal has been revoked, and the Company is no longer able to perform under
the disposal agreement. Ferret has made demand for repayment of the 1994
advance payment. Since payment cannot be made this sum was also recognized as
revenue during 1995.
General and administrative expenses decreased approximately 67% and 60%
during the years ended December 31, 1995 and 1994 compared to 1994 and 1993
due to the discontinuance of operations during 1994.
Byproduct material disposal expenses of $29,000 for the year ended
December 31, 1993 consisted of labor, rental costs and lease payments of
earth moving equipment. There were no such expenses in 1995 or 1994. A
writeoff of $236,866 occurred during 1993 when the Company abandoned its
efforts towards establishing a commercial byproduct facility. Reclamation
costs of $668,148 were recognized during 1994 because of the DEQ bond
forfeiture. These costs represent the profit margins ($300,000), accrued
interest ($195,000), and the additional amounts paid to the DEQ by third
parties ($173,000) under prior bond commitments.
In December 1993, the Company determined that its decision to sell its
primary uranium properties rather that hold the properties for future
potential development required greater consideration be given to in-ground
market values and the Company's financial position. The Company determined
its range of potential loss for the mineral properties to be from
approximately $3 million to approximately $7 million. Because of the
Company's continuing process to solicit bids for its mineral properties, the
lack of an active market for in-ground uranium reserves, and uncertainties as
to the ultimate intent of the major shareholder, management was unable to
determine at that time whether any amount in that range provided a better
estimate than any other amount. Therefore, in accordance with the
PAGE 14
requirements of Statement of Financial Accounting Standards No. (Statement) 5,
Accounting for Contingencies, a $3 million property impairment was recognized
during 1993 which represents a 31% reduction in the mineral property
valuation at December 31, 1993. In March, 1994, after the Company's efforts
to sell the uranium properties failed, the uranium properties were written
down to the amount of the CRIC notes, for which the uranium properties were
collateral. Management determined that a $4,200,000 write-down in the
carrying value of the Company's uranium properties was warranted. The
valuation of the uranium properties at approximately $2.2 million equaled
the $2.2 million debt obligations to CRIC. The properties were foreclosed
upon by CRIC during 1995.
On August 31, 1994 the Company abandoned, through non-payment of the $100
per claim annual rental fees due on that date, 500 mining claims with a
remaining book value of $-0-. During December 1993 and March 1994, mineral
property impairments of $3 million and $4.2 million, respectively, for the
remaining mining claims were recorded. During 1995 there were no property
abandonments or mineral property impairments.
Interest income increased for the year ended December 31, 1994, due to
increased interest rates compared to 1993 interest rates paid on the
Company's reclamation fund. The lower 1993 interest rates are also the cause
for interest income decreasing in 1993 compared to 1992.
Interest expense for the year ended December 31, 1994 was $125,660 as
compared to interest expense of $186,000 and $123,000 for the years ended
December 31, 1993 and 1992. Interest expense for the year ended December 31,
1994 decreased when, for financial purposes, the Company stopped accruing
interest during mid-third quarter 1994, when the foreclosure, not yet
commenced, could have been expected to have occurred. Interest expense for
the year ended December 31, 1993 increased 51% as compared with the year
ended December 31, 1992. This increase in interest expense for the two
periods reported is primarily attributable to the increase in average
outstanding debt resulting from increases in amounts borrowed from CRIC to
fund operations, particularly the costs of preparing for a commercial
byproduct disposal license and the installation of new management.
Liquidity and Capital Resources
During 1994 the Company discontinued operations due to the lack of
operating capital. For financial reporting purposes the Company has offset
its $219,000 contractual obligations towards uncompleted byproduct disposal
contracts and $173,000 obligation to third parties for payments they made to
the Wyoming DEQ upon the reclamation bond forfeiture. These liabilities
totaling $392,000 were recognized as income because the Company has no way of
repaying the obligations under liquidation basis accounting. The remaining
Company cash deposits are being utilized to maintain compliance as long as
possible with the NRC license requirements. The state of Wyoming declared
the Company in default of its reclamation obligations when the Company
terminated its business operations in May 1994. Subsequently the reclamation
bond fund of approximately $3,213,255 was acquired by the DEQ through
forfeiture proceedings. The bond fund had been funded in the full amount
fixed by the DEQ, and approved by the NRC, as the entire cost of completing
the required reclamation work and performing under the Company's license.
The reclamation requirements may be changed and the amount required to
perform the reclamation under such new requirements may increase. By state
of Wyoming statute, the Company would be liable for any cost overruns, none
of which exist at this time. The Company expects to be able to continue in
compliance with the licensing requirements through 1996 if it continues to
PAGE 15
be allocated a portion of the DOE reclamation reimbursements. After that time
the Company expects that the state of Wyoming will accept responsibility, but
there are no assurances that it will do so. Even if the state accepts
reclamation responsibility, the Company will remain liable for any costs
incurred in excess of its bond fund forfeited to the state.
The Company's working capital deficit at December 31, 1995 was $163,000,
while at December 31, 1994 it was $ 390,000, and at December 31, 1993 it was
$2,215,000. The reduced working capital deficit during 1995 occurred because
of the method used in reporting the unpaid liabilities as income during 1995.
The reduced working capital deficit during 1994 occurred because of the
method used in reporting the offset of the CRIC debt against the mineral
properties. The increased working capital deficits at December 31, 1993, and
1992 are primarily due to the negative cash flow from operations.
In prior years, the Company had relied upon investment income from the
reclamation bond, release of funds from the reclamation bond as a result of
reductions in the bonding requirement and short-term borrowings from
stockholders to satisfy its working capital needs. However, during the years
ended December 31, 1993 and 1992, the Company had received a portion of its
cash flow from disposal of third party byproduct material. In order to
expedite the September 1991 amendment to the Company's mill site reclamation
plan by which the Company was permitted by the NRC to accept byproduct
material, the Company agreed to allow the interest earned on approximately
$1.9 million of the reclamation bond to accumulate and increase the bond fund
until the disposal space initially authorized is exhausted. The reclamation
bond fund, now held by the Wyoming DEQ, was forfeited to the Wyoming DEQ
during 1994. See Item 1. Business, Reclamation of Mill Site and Tailings
Pond for details.
On August 24, 1993, the Company reached an agreement with Cycle Resource
Investment Corporation (CRIC), a stockholder, for CRIC to increase its total
loans to $2,031,200. The Company was not able to repay the notes on August
31, 1993 when due. On January 20, 1994, the payment date for this
$2,031,200 debt plus approximately $143,000 in accrued interest was extended
to June 30, 1994. CRIC foreclosed upon the Company's Peach properties in the
approximate amount of $2,750,000 during 1995. Since the Company was not able
to sell the properties prior to the extended due date of the notes on June
30, 1994, and had no other funds to continue as a going concern, the Company
was unable to prevent foreclosure of the Peach properties. The remaining
Company cash deposits are being utilized to maintain compliance, as long as
possible, with the NRC license requirements.
Income Taxes
See Note 6 to Financial Statements included in Item 14 herein.
Item 8. Financial Statements and Supplementary Data.
- ------ -------------------------------------------
See Item 14 of this report.
PAGE 16
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure.
- ------ ---------------------------------------------
The Company had a change of its independent auditors during the fiscal
year ended December 31, 1992. It has not had any disagreements with its
present or previous auditors on any matter of accounting principles or
practices or financial statement disclosure. Due to the Company's
discontinuance of business operations in 1994, the Company dismissed its
independent auditors, Mitchell - Finley and Company, on January 26, 1995.
PART III
--------
Item 10. Directors and Executive Officers of the Registrant
- -------- --------------------------------------------------
The following table sets forth certain information concerning directors
and executive officers of the Company:
Name and All Positions
Currently Held With Year First Became
the Corporation Age A Director/Officer
- --------------- --- ------------------
William C. Salisbury, Secretary 48 1995
Treasurer 1995
Director 1993
Dennis A. Eckerdt, President 47 1995
Chief Financial Officer 1991
Director 1992
<FN>
The executive officers of the Company serve at the pleasure of the Board
of Directors and do not have fixed terms.
Business Experience of Directors and Officers
The principal occupations of each officer for at least the past five
years are as follows:
William C. Salisbury was appointed President of the Company in August
1993. He served in that office until August 1995 when he became the
Secretary and Treasurer of the Company. He is currently self-employed as a
consultant providing land management; environmental and regulatory services
to the Company and other natural resources companies. From October 1991
until his appointment as President, he was Vice President of the Company, and
from October 1990 to October 1991 he was manager of special projects for the
Company. From July 1983 to October 1990 he was a self-employed consultant
providing land management, environmental and regulatory services to the
Company and other natural resource companies. From November 1970 to July
1983 he was manager of land and contracts for the Company. He was appointed
to the Board of Directors in August 1993.
PAGE 17
Dennis A. Eckerdt became President of the Company in August 1995. He was
previously the Chief Financial Officer since November 1991. He is currently
employed as Controller for a Boulder Colorado corporation. Prior to July,
1995, he was self-employed. Prior to his self-employment, he was Controller
for Centennial Media Corporation and Denver Directory Company from November
1988, through August 1991. From November 1985, to November 1988, he was
employed as Controller for Video Exchange, Inc. From February 1972, to
November 1988, he held various accounting titles and positions with the
Company including Controller and Chief Financial Officer. He was also a
Director of the Company from 1984 through 1988 and was reappointed to the
Board of Directors in August 1992.
The Company's executive officers and directors are required to file
reports of ownership and changes in ownership of the Company's securities
with the Securities and Exchange Commission as required under provisions of
the Securities Exchange Act of 1934. Based solely on the information
provided to the Company by individual directors and executive officers, the
Company believes that during the last fiscal year all directors and executive
officers have complied with applicable filing requirements.
Item 11. Executive Compensation.
- -------- -----------------------
Cash Compensation
- -----------------
The following table shows all cash compensation paid or to be paid by the
Company or any of its subsidiaries, as well as other compensation paid or
accrued during the fiscal years indicated to the Chief Executive Officer and
the four other highest paid executive officers of the Company as of the end
of the Company's last fiscal year whose salary and bonus for such period in
all capacities in which the executive officer served exceed $100,000.
PAGE 18
SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- --------------------- ----------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Restricted All
Annual Stock LTIP Other
Name and Principal Compen- Award Options/ Payouts Compen-
Position Year Salary($) Bonus($) sation($) ($) SARs ($) sation($)
- ------------------ ---- --------- -------- --------- ---------- -------- ------- ---------
William C. Salisbury(1) 1995 $--- --- --- --- --- --- $37,360(3)
President 1994 $46,896 --- $ 6,558(2) --- --- --- $53,500(3)
1993 $78,750 --- $11,400(2) --- --- --- $---
- -----
<FN>
<F1> President from August 1993 until August 1995.
<F2> Contributions to the Company's money purchase pension plan established to provide retirement
benefits to employees. The plan was terminated in 1994.
<F3> After employment as chief executive officer was terminated as of May 31, 1994, upon the close of
the Company's business, other compensation was received for services performed in winding up
the Company's business and reclamation obligations.
</FN>
The executive officers of the company serve at the pleasure of the Board
of Directors and do not have fixed terms. Executive officers generally are
elected at the annual director meeting immediately following the annual
stockholder meeting. Any officer elected or appointed by the Board of
Directors may be removed by the Board whenever in its judgment the best
interests of the Company will be served thereby without prejudice, however to
contractual rights, if any, of the person so removed. The Company's policy
is to pay employees, upon termination of employment by the Company, severance
pay equal to one week of their salary for each full year of employment. The
officers are not employees of the company.
There are no family relationships among the directors. There are no
arrangements of understandings between any director and any other person
pursuant to which that director was elected.
Item 12. Security Ownership of Certain Beneficial Owners and Management
- -------------------------------------------------------------------
The following table shows beneficial ownership of shares of the
Company's outstanding common stock as of the record date (I)by all persons,
insofar as is known to the Company, owning more than 5% of such stock and
(ii) by each director, each director nominee, each of the executive officers
named in the tables under "Executive compensation" and all directors and
executive officers as a group:
PAGE 19
Amount and
Nature of
Name of Positions and Beneficial Percent of
Title of Class Beneficial Owner Offices Held Ownership Class
- -------------- ---------------- ------------ --------- ----------
Common Stock William C. Salisbury Secretary 19,952(1) *
Treasurer and
Director
Common Stock Dennis A. Eckerdt President 0 0%
Director
Common Stock Cycle Resource Shareholder 2,300,000 29.9%
Investment Corporation
300 Atlantic Avenue
Stamford, CT 06901
Common Stock General Electric Capital Shareholder 593,072 7.7%
Corporation
260 Long Ridge Road
Stamford, CT 06902
Common Stock All directors and Officers and 4,024 of *
executive officers as Directors record and
a group (2 persons) 15,928
indirectly
- ---------------
<FN>
*Less than one percent
<F1> (1) Includes 15,928 shares subject to options to purchase issued by the Company,
as to which shares the options disclaims beneficial ownership.
Item 13. Certain Relationships and Related Transactions
- -------- ----------------------------------------------
Cycle Resource Investment Corporation (CRIC), a wholly owned subsidiary
of NUKEM, Inc., loaned the Company a total of $2,031,200 for operating
capital. The loan was evidenced by notes due June 30, 1994 with interest at
three percent over the prime rate. The notes were considered paid in full
upon foreclosure of the Peach properties by CRIC in 1995.
Salt Ridge Energy, Inc., which is wholly owned by Mr. Salisbury, was paid
$51,000 during 1995 for site monitoring work, reclamation obligations, and
winding up the Company's business, during October 1995 through September
1996.
PAGE 20
PART IV
-------
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K.
- ------- -------------------------------------------------------
(a) The following documents are filed as a part of this report:
1. Financial Statements:
- Balance Sheets, December 31, 1995 (unaudited), December
31, 1994, (Unaudited) and December 31, 1993
- Statements of Operations and Retained Earnings
(Accumulated Deficit) for the years ended December 31,1995
(Unaudited), 1994, (Unaudited), and 1993.
- Statements of Cash Flows for the years ended December 31,
1995 (Unaudited), 1994 (Unaudited), and 1993.
- Notes to Financial Statements for the years ended
December 31, 1995 (Unaudited), 1994 (Unaudited), and
1993.
2. Financial Statement Schedules (for the years ended
December 31, 1995 (Unaudited), 1994, (Unaudited), and
1993.
- V - Property, Plant, and Equipment
- VI - Accumulated Depreciation, Depletion, and
Amortization of Property, Plant, and Equipment
All other schedules are omitted because of the absence of the conditions
under which they are required or because the required information is included
in the financial statements or notes thereto.
(b) Reports on Form 8-K.
--------------------
A report on Form 8-K was filed on January 27, 1995, reporting the
Company's dismissal of its independent auditors due to the Company's
discontinuance of business operations in 1994.
PAGE 21
(c) Exhibits.
--------
Exhibit
Number Description
- ------- -----------
3.1 Restated Articles of Incorporation, dated October 28, 1991
(incorporated herein by reference from the exhibits to
Registrant's report filed on Form 10-Q dated September 30, 1992).
3.2 Bylaws, dated August 15, 1980 (incorporated herein by reference
from the exhibits to Registrant's report filed on Form 10-Q dated
October 10, 1980).
3.3 Amendment to Bylaws, dated December 7, 1994 incorporated herein by
reference from the exhibits to Registrant's Report filed on Form
8-K dated January 27, 1995.
10.1 Agreement and First Amendment to Loan Agreement between Cycle
Resource Investment Corporation and American Nuclear Corporation,
dated June 27, 1991 (incorporated herein by reference from the
exhibits to Registrant's report filed on Form 8 dated September
24, 1991).
10.2 Extension of Amended Promissory Note (Second) dated December 1,
1992 (incorporated herein by reference from the exhibits to
Registrant's report filed on Form 8 dated December 2, 1992).
10.3 Forbearance Agreement between the Company and Cycle Resource
Investment Corporation dated January 20, 1994 (incorporated
herein by reference from exhibits to Registrant's report filed on
Form 8 dated January 21, 1994).
10.4 Escrow Agreement between the Company and Uniwest Trust Company
and the Tennessee Valley Authority, dated November 28, 1984
(incorporated herein by reference from the exhibits to
Registrant's proxy material
dated January 18, 1985).
19.1 Debt Restructuring agreement between American Nuclear
Corporation, and The Wyoming National Bank of Casper, dated
November 28, 1984 (incorporated herein by reference from the
exhibits to Registrant's report filed on Form 8 dated
September 24, 1991)
27 Financial Data Schedule, which is submitted electronically to the
Securities and Exchange Commission
PAGE 22
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.
REGISTRANT: AMERICAN NUCLEAR CORPORATION
BY:
--------------------------------
DENNIS A. ECKERDT, President
(Signature)
DATE: March 15, 1996
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:
---------------------------------------
WILLIAM C. SALISBURY, Secretary,
Treasurer and Director
(Signature)
DATE: March 15, 1996
BY:
---------------------------------------
DENNIS A. ECKERDT, President,
Chief Financial Officer and Director
(Signature)
DATE: March 15, 1996
PAGE 23
INDEPENDENT AUDITORS' REPORT
- ----------------------------
Shareholders and Board of Directors
American Nuclear Corporation:
Casper, Wyoming
We have audited the accompanying balance sheets of American Nuclear
Corporation (the Company) as of December 31, 1993 and 1992, and the related
statements of operations and retained earnings (accumulated deficit) and cash
flows for the years then ended. Our audit also included the financial
statement schedules for the years ended December 31, 1993 and 1992 as listed
in the index at Item 14. These financial statements and corresponding
financial statement schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion on the financial
statements and financial statement schedules 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 financial position of the Company as of
December 31, 1993 and 1992, and the results of its operations and cash flows
for the years then ended in conformity with generally accepted accounting
principles. Also, in our opinion, the financial statement schedules referred
to above, when considered in relation to the basic financial statements taken
as a whole, present fairly, in all material respects the information required
to be included therein.
The accompanying 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 incurred significant operating losses
and was unable to repay notes payable to its major shareholder when due
during 1993. The Company and its major shareholder signed a forbearance
agreement extending the term of the notes to June 30, 1994. Substantially
all of the Company's assets are pledged as collateral for the notes payable.
These issues raise substantial doubt about the Company's 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.
PAGE 24
As discussed in Note 1, the Company discontinued its operations related
to the development and production of mineral properties. Management
estimates the Company's range of loss associated with its discontinued
operations to be from approximately $3 million to approximately $7 million,
of which the Company recognized a $3 million mineral property impairment for
the year ended December 31, 1993. The Company is continuing efforts to sell
its mineral properties, the ultimate outcome of which cannot presently be
determined.
SIGNATURE
MITCHELL - FINLEY AND COMPANY, P.C.
Certified Public Accountants
March 9, 1994
Denver, Colorado
PAGE 25
AMERICAN NUCLEAR CORPORATION
- ----------------------------
BALANCE SHEETS DECEMBER 31, 1995 (Unaudited), 1994 (Unaudited), AND 1993
- ------------------------------------------------------------------------
ASSETS
- ------
December 31, December 31, December 31,
1995 1994 1993
NOTES (Unaudited) (Unaudited)
----- ----------- ----------- -----------
CURRENT ASSETS:
Cash and cash equivalents $ 3,974 $ 16,121 $ 164,302
Reclamation deposit income
receivable 2 3,392
Prepaids and other 20,851
----------- ----------- ----------
Total current assets 3,974 16,121 188,545
----------- ----------- ----------
MINING PROPERTIES HELD FOR SALE 1 -0- -0- 6,497,123
----------- ----------- ----------
MINING PROPERTIES - Net 2,4 -0- -0- -0-
----------- ----------- ----------
PLANT AND EQUIPMENT - Net 3 -0- -0- 91,720
----------- ----------- ----------
OTHER ASSETS:
Reclamation deposit 2 113,232 3,011,871
Other 101,358 55,841 55,550
----------- ----------- ----------
Total other assets 214,590 55,841 3,067,421
----------- ----------- ----------
TOTAL $ 218,564 $ 71,962 $9,844,809
=========== =========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES:
Note payable to stockholder 4 $2,031,200
Accrued interest payable 142,929
Trade accounts payable $ 53,979 $ 14,724 7,806
Deferred revenue 219,000 202,500
Other current liabilities 113,232 173,000 18,302
----------- ------------ ----------
Total current liabilities 167,211 406,724 2,402,737
----------- ----------- ----------
LONG TERM DEBT 8
Capitalized lease obligations -0- -0- 45,498
----------- ----------- ----------
Total long term debt -0- -0- 45,498
----------- ----------- -----------
ESTIMATED RECLAMATION COSTS 2 -0- -0- 2,740,290
----------- ----------- -----------
COMMITMENTS AND CONTINGENCIES 1,8
REDEEMABLE PREFERRED STOCK 7
PAGE 26
AMERICAN NUCLEAR CORPORATION
- ----------------------------
BALANCE SHEETS DECEMBER 31, 1995 (Unaudited), 1994, (Unaudited), and 1993
- ------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
December 31, December 31, December 31,
1995 1994 1993
NOTES (Unaudited) (Unaudited)
----- ----------- ----------- -----------
STOCKHOLDERS' EQUITY: 4,7
Common stock (7,696,739
shares standing) 314,080 314,080 314,080
Additional paid-in capital 13,304,849 13,304,849 13,304,849
Retained earnings
(accumulated deficit) (12,938,450) (13,324,545) (8,333,519)
Less cost of common stock
held in treasury (629,126) (629,126) (629,126)
------------ ----------- -----------
Stockholders' equity (deficit) 51,353 (334,762) 4,656,284
------------ ----------- -----------
TOTAL $ 218,564 $ 71,962 $ 9,844,809
============ =========== ===========
See Independent Auditors' Reports and notes to financial statements.
PAGE 27
AMERICAN NUCLEAR CORPORATION
- ----------------------------
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (ACCUMULATED DEFICIT) FOR THE YEARS
ENDED DECEMBER 31, 1995 (UNAUDITED), 1994 (UNAUDITED), and 1993
- ----------------------------------------------------------------------------------
Year Year Year
Ended Ended Ended
December December December
31, 1995 31, 1994 31, 1993
NOTES (Unaudited) (Unaudited)
----- ----------- ----------- -----------
REVENUE FROM DISCONTINUED
OPERATIONS:
Byproduct material
disposal 5 $ -0- $ -0- $ 322,624
------------ ------------ -----------
Total revenues from
discontinued operations -0- -0- 322,624
------------ ------------ -----------
DISCONTINUED EXPENSES:
General and adminis-
trative 67,786 208,701 517,391
Byproduct material
disposal 5 29,224
Commercial byproduct
facility 5 236,866
Reclamation 6 182,180 668,146
Impairments and
Abandonments 1 4,200,000 3,543,826
------------ ------------ -----------
Total discontinued
operating expenses 249,966 5,076,847 4,327,307
OTHER INCOME (EXPENSE):
Reclamation Reimbursement 6 229,707
-DOE Interest income 2 4,374 178,833 117,158
Gain (loss) on sale of
investments and other 10,000 32,628
Interest expense 4 (125,660) (186,021)
Other Income 392,000
------------ ------------ -----------
NET INCOME (LOSS) 386,115 (4,991,046) (4,073,546)
RETAINED EARNINGS
(Accumulated Deficit):
Beginning of
period (13,324,565) (8,333,519) (4,259,973)
------------ ------------ -----------
End of period $(12,938,450) $(13,324,565) $(8,333,519)
============ ============ ===========
(Continued on following page)
PAGE 28
NET LOSS BEFORE
DISCONTINUED
OPERATION
PER SHARE $ -0- $ -0- $ -0-
DISCONTINUED
OPERATION PER
SHARE $ 0.05 $ (0.65) $ (0.53)
---------- ---------- -----------
NET INCOME (LOSS) PER
COMMON SHARE: $ 0.05 $ (0.65) $ (0.53)
========== ========== ===========
WEIGHTED-AVERAGE
NUMBER OF SHARES
OUTSTANDING 1 7,696,739 7,696,739 7,696,622
========== ========== ===========
See Independent Auditors' Reports and notes to financial statements.
PAGE 29
AMERICAN NUCLEAR CORPORATION
- ---------------------------
STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 1995 (UNAUDITED),
1994 (UNAUDITED), AND 1993
- ----------------------------------------------------------------------------------------
Year Year Year
Ended Ended Ended
December December December
31, 1995 31, 1994 31, 1993
(Unaudited) (Unaudited)
----------- ----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 386,115 $(4,991,046) $(4,073,546)
Adjustments to reconcile net loss
to net cash used by operating
activities:
Mining property impairment 4,200,000 3,000,000
Abandonment of mining property 543,826
Abandonment of commercial
byproduct project 236,866
Depreciation and amortization 6,544 19,371
Reclamation Expense 473,000
Decrease (increase) in Assets:
Reclamation deposit (113,232) 3,011,871
Reclamation deposit income
receivable 3,392 (560)
Plant and Equipment (Net) 85,176
Other assets (45,517) 20,560 (45,001)
Increase (decrease) in Liabilities:
Accrued interest payable (142,929) 49,063
Trade accounts payable 39,255 6,918 (11,426)
Deferred revenue (219,000) 16,500 186,000
Other liabilities (59,768) (2,050)
Estimated reclamation costs ( 3,213,290) (109,386)
---------- ----------- -----------
Net cash from operating
activities (12,147) (523,304) (206,843)
----------- ----------- -----------
(Continued)
PAGE 30
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of investment securities (2,772,000) (2,483,200)
Proceeds from sale or maturity of
investment securities 2,772,000 2,483,200
Additions to mining properties,
plant and equipment (688) (139,512)
Capitalized disposal costs (1,548)
----------- -----------
Net cash flows from investing
activities (688) (141,060)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds recorded from pending
foreclosure on mineral properties 2,297,811
Borrowing (payments to/from) stockholder (2,031,200) 411,694
Borrowings from others 173,000
Borrowing (payments on long-term debt) (63,800) (18,303)
----------- -----------
Net cash flows from financing
activities 375,811 393,391
----------- -----------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (12,147) (148,181) 45,488
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 16,121 164,302 118,814
----------- ----------- -----------
CASH AND CASH EQUIVALENTS AT END OF
PERIOD $ 3,974 $ 16,121 $ 164,302
=========== =========== ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Interest paid $ -0- $ -0- $ 129,908
=========== =========== ===========
Issuance of stock for ESOP
contribution $ -0- $ -0- $ -0-
=========== =========== ===========
Issuance of stock for stock bonus $ -0- $ -0- $ -0-
=========== =========== ===========
See Independent Auditors' Reports notes to financial statements.
PAGE 31
AMERICAN NUCLEAR CORPORATION
- ----------------------------
NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1995
(UNAUDITED), 1994 (UNAUDITED), AND 1993
- --------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Liquidation Basis of Presentation
---------------------------------
The accompanying unaudited 1995 and 1994 financial statements have been
prepared on a liquidation basis, which recognized the realization of assets
and the satisfaction of a portion of the liabilities during 1995 and 1994.
Also included are the financial statements of the Company for year ended
December 31, 1993. The statements of operations and retained earnings and
cash flows for the years ended December 31, 1995 and 1994 are unaudited. In
the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
As of December 31, 1995 the Company's current liabilities exceed current
assets by approximately $163,000, and the Company has incurred significant
operating losses during recent years. The Company's current liabilities are
primarily obligations towards site reclamation ($113,232) and monitoring
($53,979).
For financial reporting purposes the Company has offset its $219,000
contractual obligations towards uncompleted byproduct disposal contracts and
$173,000 obligation to third parties for payments they made to the Wyoming
DEQ upon the reclamation bond forfeiture. These liabilities totaling
$392,000 were recognized as income because the company has no way of repaying
the obligations under liquidation basis accounting. The remaining Company
cash deposits are being utilized to maintain compliance with the NRC license
requirements as long as possible.
Mining Properties
-----------------
Mining properties consist of unrecovered acquisition, exploration and
development costs maintained on a property-by-property basis. Mining
properties are depleted by the units-of-production method based on estimated
economic reserves. All acquisition, exploration and development costs
incurred in connection with the various uranium properties are capitalized.
Gains or losses are recognized upon the sale of individual property
interests. All costs incurred in connection with unsuccessful exploration
and abandoned interests are charged to expense when known, and all of the
properties are evaluated at least annually on a property-by-property basis.
Mining properties in total are assessed annually for purposes of impairment,
considering, among other factors, production economics and estimated in-
ground market values. Any mineral property impairments are charged to
operations.
In December 1993, the Company determined that its decision to sell its
primary uranium properties rather than hold the properties for future
potential development required greater consideration be given to in-ground
market values and the Company's present financial position. The Company
determined its range of potential loss for the uranium properties to be from
approximately $3 million to approximately $7 million. Because of the
PAGE 32
Company's continuing process to solicit bids for its uranium properties, the
lack of an active market for in-ground uranium reserves, and uncertainties as
to the ultimate intent of the major shareholder, management was unable to
determine at that time whether any amount in that range provided a better
estimate than any other amount. Therefore, in accordance with the
requirements of Statement of Financial Accounting Standards No. (Statement)
5, Accounting for Contingencies, a $3 million property impairment was
recognized during 1993 which represented a 31% reduction in the property
valuation at December 31, 1993. In March, 1994, after the Company's efforts
to sell the uranium properties failed, the uranium properties were written
down to the amount of the CRIC notes, for which the uranium properties were
collateral. Management determined that a $4,200,000 write-down in the
carrying value of the Company's uranium properties was warranted. The
uranium properties were foreclosed upon the total debt obligations to CRIC.
Uranium property abandonments of $543,826 occurred during 1993, and zero
during 1995 and 1994.
Depreciation
------------
The Company provided for depreciation of plant and equipment on a
straight-line basis over the estimated useful lives of the assets, which vary
from 2 to 20 years. During 1994 the Company liquidated all of its plant and
equipment assets.
Per Share Amounts
-----------------
Per share amounts are computed on the weighted-average number of shares
outstanding during the respective periods. Shares under option and warrants
have been disregarded because their effect is anti-dilutive (See Note 7).
Major Customer
----------------
The Company had one unaffiliated customer which accounted for 87% of its
byproduct material disposal revenue during 1993. The Company had no
customers in 1995 and 1994.
Statement of Cash Flows
-----------------------
For purposes of the Statements of Cash Flows, the Company considers all
highly liquid debt instruments purchased with an original maturity of 3
months or less to be cash equivalents.
Reclamation of Mill Site and Tailings Ponds
-------------------------------------------
Liabilities for estimated reclamation costs are recognized and charged to
operations for remedial activities when the cleanup becomes probable and the
cost can be reasonable estimated.
PAGE 33
Based upon the Company's determination that use in the future of its
uranium processing mill would not comply with the revised licensing
requirements of the Nuclear Regulatory Commission (NRC), the Company began
demolition of the mill in 1988 and completed that work in 1989. Since then
the Company has undertaken substantial reclamation work on the mill site as
required by the NRC and the Wyoming Department of Environmental Quality
(DEQ). The mill and associated buildings have been dismantled and the
building materials buried in one of the two adjacent tailings ponds where the
processed ores produced by the mill (mill tailings) were impounded after
milling. The mill tailings in the two impoundments have been graded by earth
moving equipment into mounds covering approximately 40 and 80 acres
respectively. A cover of native earth has been placed over the mounds of
mill tailings, and the tailings piles are being allowed to settle and compact
naturally. The remaining reclamation work consists of filling and shaping
the side slopes of the tailings piles to such a grade as to preclude soil
erosion and exposure of the tailings, placing a final cover of earth over the
tailings to limit emission of radon gas into the atmosphere to meet
Environmental Protection Agency (EPA) standards, applying erosion protection
in the associated drainages, and revegetating and fencing the site.
When the Company discontinued business operations, the DEQ began
reclamation bond forfeiture proceedings against the Company. These
proceedings resulted in bond forfeiture in October 1994. The Company expects
that reclamation of the mill site will now be performed by the DEQ but it has
not agreed to accept that responsibility. The Company continues to be
responsible for all NRC license requirements until such time as the license
is terminated or transferred to another responsible entity by the NRC. The
state of Wyoming has indicated that it would assume the NRC license under
certain conditions. There are no assurances the state will take the NRC
license. By statute the DEQ may recover reclamation costs in excess of the
bonded amount. The total reclamation cost will not be known for several
years.
2. CONTRACTS
The Company had contracts covering the acquisition of mineral properties
with Tennessee Valley Authority (TVA) through November 28, 1984, at which
time the Company and TVA entered into an agreement whereby all prior
contractual arrangements between the Company and TVA were terminated.
The Company assumed the responsibilities TVA had (and released TVA of any
obligation with respect to same) relating to the reclamation of existing
tailings at the Company's uranium processing mill located in the Gas Hills
Area of Wyoming, and for the future decommissioning of the mill. In exchange
for the Company's agreement to do so, TVA deposited into an escrow account
(original escrow) $3,777,000, the principal of which is to be used only for
reclamation of such tailings and for decommissioning of the mill. The
Company deposited $304,396 into the original escrow and furnished the DEQ
with its bond in the amount of $4,081,396 to cover the estimated costs of
reclamation and mill decommissioning. Certain shareholders of the Company
had provided letters of credit to the DEQ as support of the bond receiving
in exchange warrants to purchase common stock. One letter of credit for
$25,000 remained outstanding as of the Wyoming DEQ's bond forfeiture. Each
year the Company submits a plan of reclamation and long term monitoring to
the NRC and the DEQ who reviews and approves the plan and the estimated
costs.
PAGE 34
In August of 1990, the Company entered into an agreement with an
insurance company to obtain a reclamation performance bond to replace a
portion of the funds in the original escrow. As a result, the Company
received $1,030,221 from the original escrow and deposited $850,000 (which
was subsequently reduced by the insurance company to $721,000) in a second
escrow account to serve as collateral on a reclamation performance bond. The
reclamation performance bond of $1,030,221 was subsequently reduced to
$864,770 due to the Company's completion of certain phases of the reclamation
plan. When the Wyoming DEQ forfeited the reclamation performance bond, the
insurance company incurred a loss of $148,000.
The state of Wyoming declared the Company in default of its reclamation
obligations when the Company terminated its business operations in May 1994.
Subsequently the reclamation bond fund of approximately $3,213,255 was
acquired by the DEQ through forfeiture proceedings. The bond fund had been
funded in the full amount fixed by the NRC and the DEQ, as the entire cost of
completing the required reclamation work and performing under the Company's
license. There is some risk that the reclamation requirements may be changed
and that the amount required to perform the reclamation under such new
requirements may increase. By state of Wyoming statute, the Company would be
liable for any cost overruns, none of which exist at this time. The Company
expects to be able to continue in compliance with the licensing requirements
through 1996 if its is allocated a portion of the DOE reclamation
reimbursements. After that time the Company expects that the state of
Wyoming will accept responsibility, but there are no assurances that it will
do so.
3. PLANT AND EQUIPMENT
Plant and equipment is stated at cost and consisted of the following at
these specific dates:
December 31, December 31, December 31,
1995 1994 1993
(Unaudited) (Unaudited)
----------- ----------- -----------
Buildings and equipment $ -0- $ -0- $ 152,403
Furniture and fixtures -0- -0- 63,168
Vehicles -0- -0- 38,032
----------- ----------- -----------
Total Plant & Equipment $ -0- -0- $ 253,603
Accumulated depreciation
and amortization -0- -0- 161,883
----------- ----------- -----------
Net Plant & Equipment $ -0- -0- $ 91,720
=========== =========== ===========
PAGE 35
4. NOTES PAYABLE TO STOCKHOLDER
The Company had notes payable with Cycle Resource Investment Corporation
(CRIC), a major shareholder of the Company. The notes payable are
collateralized by a security interest in substantially all of the Company's
assets. The notes bear interest at 3% over prime of a New York bank (9.5%
from December 31, 1993 through August 1994 when the Company stopped accruing
interest). Balances are as follows:
December 31
-------------------------------------
1995 1994 1993
(Unaudited) (Unaudited)
----------- ---------- ----------
Principal Outstanding:
Credit Line: Fully utilized as of
December 31, 1995, 1994 and 1993;
interest and principal
due June 30, 1994 $ -0- $ -0- $1,383,200
Additional Credit Line:
Fully utilized as of December 31,
1995, 1994 and 1993; interest and
principal due June 30, 1994 -0- -0- 648,000
----------- --------- ----------
Total $ -0- $ -0- $2,031,200
=========== ========= ==========
Accrued Interest Outstanding:
Credit Line $ -0- $ -0- $ 93,456
Additional Credit Line -0- -0- 49,473
----------- --------- ----------
Total $ -0- $ -0- $ 142,929
=========== ========= ==========
In 1995 Cycle Resource Investment Corporation (CRIC) foreclosed its
mortgage upon the Peach Properties which was then in the approximate amount
of $2,750,000, including principal, interest and costs. The remaining Company
cash deposits are being utilized to maintain compliance as long as possible
with the NRC license requirements.
Also see Note 1.
The principal amount of average short-term borrowings were $2,031,200,
$2,031,200, $1,871,875, and $1,227,897 with weighted-average interest rates
of 9.50% for the years ended December 31, 1995, 1994 and 1993. The maximum
principal amount borrowed during each period was $2,031,200 for the years
ended December 31, 1995, 1994 and 1993.
5. BYPRODUCT MATERIAL DISPOSAL CONTRACTS
The Company abandoned its efforts to develop a long-term commercial
disposal business and charged the associated costs of $236,866 to expense
during 1993. The Company attempted to continue its short term disposal
operations and entered into certain byproduct material disposal contracts and
PAGE 36
received advance payments related to the future performance of these services.
The advance payments are recorded as a liability, deferred revenue. The
Company is unable to perform under the conditions of the agreements by which
the advance payments were received. See Item 1, Business, Marketing of
Disposal Contracts, for further detail.
6. INCOME TAXES.
The Company adopted Statement 109, Accounting for Income Taxes, as of
January 1, 1993. There was no cumulative effect of this change in accounting
for income taxes. Prior years' financial statements have not been restated
to apply the provisions of Statement 109.
At December 31, 1995 the Company had approximately $20.0 million of net
operating loss carryovers which expire during 1997 through 2009. The Company
also has investment tax and new jobs credit carryovers of approximately
$40,000 and $200,000, respectively, which are available to be offset against
future income taxes through 1999. The future utilization of both net
operating loss and credit carry-overs are subject to rules and regulations of
the internal revenue service that could be significant.
7. STOCKHOLDERS' EQUITY
The Company has authorized 25,000,000 shares of $.04 par value common
stock. Changes in common stock issued and outstanding during the years ended
December 31, 1993, 1994 and 1995 were as follows:
Common Stock
-----------------------------------------
Held in
Issued Treasury (at cost) Additional
-------------------- ------------------- Paid-in
Shares Amount Shares Amount Capital
--------- -------- ------- --------- -----------
Balance,
December 31,
1992 7,851,983 $314,080 155,444 $(629,126) $13,304,849
--------- -------- ------- --------- -----------
Stock Issuances 200 -0-
--------- -------- ------- --------- -----------
Balance,
December 31,
1993 7,852,183 $314,080 155,444 $(629,126) $13,304,849
--------- -------- ------- --------- -----------
Balance,
December 31,
1994 7,852,183 $314,080 155,444 $(629,126) $13,304,849
--------- -------- ------- --------- -----------
Balance,
December 31,
1995 7,852,183 $314,080 155,444 $(629,126) $13,304,849
========= ======== ======= ========= ===========
PAGE 37
Redeemable Preferred Stock
--------------------------
The Company has authorized 15,000,000 shares of $1 par value Series A
preferred stock with a liquidation value of $10.00 per share. There were no
outstanding preferred shares during the periods ended December 31, 1995, 1994
and 1993.
Stock Warrants
-------------
The Company had warrants outstanding for the purchase of 49,020 shares of
common stock, exercisable at $0.875 per share, which expired on August 26,
1995.
Employee Stock Ownership Plan
------------------------------
The Company had an Employee Stock Ownership Plan (ESOP) for the benefit
of its employees. Contributions to the Plan were made at the Company's
discretion. On March 6, 1992 the Board of Directors resolved to terminate
the ESOP and replace it with a money purchase plan. The money purchase plan
received approval by a vote of the shareholders on June 17, 1992. During the
year ended December 31, 1992, the Company made contributions to the Plan of
5,272 shares of the Company's common stock. At December 31, 1994 the Plan
held 4,235 shares of the Company's common stock for the account of prior
participating employees that cannot be located. On December 31, 1995 and
1994 the common stock had relatively no market value.
Non-qualified Stock Options
---------------------------
At December 31, 1994, an option for 257,750 shares of common stock is
held by the Company's former president. This option is exercisable in whole
or in part at $1.5761 a share and expires on September 9, 1996.
At December 31, 1994, options covering 15,928 shares of common stock are
held by the current secretary, treasurer and director. An additional 258,148
options are held by former directors and officers. These 274,076 shares are
exercisable in whole or in part at varying prices from $0.5886 to $1.8834 per
share with expiration dates ranging through 1996.
There were no options exercised during the three years ended December 31,
1995.
1992 Incentive Stock Option Plan
--------------------------------
During June 1992 the shareholders adopted a 1992 Incentive Stock Option
Plan (herein ISOP), under which up to 1,000,000 shares of the Company's $0.04
par value common stock have been reserved for granting to employees. The
ISOP is intended to meet the requirements of Section 422A of the Internal
Revenue Code. Option prices will be no less than the fair market value or
110 percent of fair market value, in certain situations. The term of an
option shall be for a period of no longer than ten years from the date of the
PAGE 38
grant of the option. The ISOP expires on its term anniversary date and will
be administered by the compensation committee of the board of directors.
During December 1993 options for 120,000 shares that were granted during
June 1992 were voluntarily forfeited by the employees. As of December 31,
1994 there were no stock options outstanding under the 1992 Incentive Stock
Option Plan.
1992 Stock Option Plan In Lieu of Directors Fees
------------------------------------------------
The 1992 Stock Option Plan In Lieu of Directors Fees was approved by the
shareholders in June 1992 and authorized each non-employee director to elect
to receive stock options for service during the previous year rather than to
receive cash compensation. The plan provided each director an option to buy
a number of shares of the Company's stock, at a discount of 37% of the fair
market price on the date of grant. The plan was administered by the
compensation committee of the Board of Directors. Directors were entitled to
such options only after having served for a full year as a director, and only
if they are not regular, full-time employees of the Company.
The plan required eligible directors to make an irrevocable election in
June of each year whether to receive options, and if so, the number of shares
subject to the option and the exercise price are fixed according to the pre-
established formula based upon the market price for the stock six months later
in January of the next year.
As of December 31, 1993, options for 13,546 shares were outstanding. The
options were exercisable until January 12, 1994 at a price of $.5906 per
share. These options were not exercised. This plan was terminated by the
Board of Directors on January 13, 1994 because the extremely low price of the
Company's common stock resulted in the granting options in amounts which were
considered excessive by the Board of Directors.
Money Purchase Pension Plan
---------------------------
During 1992 the Company adopted a Money Purchase Pension Plan (herein
"Plan"), with a plan year ending each December 31, whereby the Company
contributed to all participants. Generally, participants were all full-time
Company employees at least 21 years of age with one year of service. The
Plan was integrated with the Company's contributions under the Federal Social
Security Act (social security taxes). As a result, annual required Plan
contributions are between 9.5% and 15% of participants' compensation.
Employer contributions vest at the rate of 20% per year beginning at the end
of the first year of service. The Company accrued contributions of $-0-,
$11,705, and $26,572 for 1995, 1994 and 1993, respectively. The Money
Purchase Pension Plan was terminated in 1994 upon termination of all of the
Company's employees.
PAGE 39
Confidential Private Placement Memorandum
-----------------------------------------
The Company offered, by a private placement, on a best efforts basis
4,761,905 shares ($5,000,000) minimum, 7,619,048 shares ($8,000,000) maximum,
of its restricted $0.04 par value common stock at a price of $1.05 per share.
The offering began on January 25, 1993 and continued through June 25,
1993. This confidential private placement memorandum was unsuccessful and
was withdrawn on June 25, 1993. Because of this failure to raise additional
capital, the Company was forced to abandon its efforts towards obtaining a
commercial byproduct disposal license. The employment contract between the
Company and its then President, Stephen A. Carpenter, was terminated on
August 1, 1993.
8. COMMITMENTS
Operating Leases
----------------
The Company leased its office space on a month to month basis under an
operating lease which expired in November of 1993. The Company discontinued
leasing office space during May 1994 and has no annual lease commitments.
Rent expense, included in general and administrative expenses, was $-0-,
$8,905, and $20,481 for the years ended December 31, 1995, 1994, and 1993.
Capitalized Lease Obligations
-----------------------------
The Company leased one piece of earth moving equipment and one vehicle
under noncancellable capitalized lease obligations which expire in June 1997
and June 1994, respectively. During 1994 the one piece of earth moving
equipment was returned by the Company to the lessor, and the vehicle lease
expired. The Company remains liable for the unpaid lease payments on the
earth moving equipment. The equipment lessor intends to sell the equipment
and apply the proceeds of the sale to the remaining lease obligation. Any
remaining deficiency will be an obligation of the Company. At December 31,
1995 and 1994 the Company has no capitalized costs and no future minimum
lease payments.
Employment Agreements
---------------------
The Company had no employment contracts with any of its employees at
December 31, 1995.
PAGE 40
SCHEDULE V
- ----------
AMERICAN NUCLEAR CORPORATION
- ----------------------------
ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION
OF PROPERTY, PLANT, AND EQUIPMENT
- ----------------------------------------------------
Balance At Balance
Beginning Additions Retirements at End
Classification of Year At Cost /Other of Year
- -------------- ----------- --------- ----------- -----------
FOR THE YEAR ENDED
DECEMBER 31, 1993:
Mining properties $ 9,901,437 $ 139,512 $(3,543,826) $ 6,497,123
Plant and Equipment 253,603 253,603
----------- --------- ----------- -----------
TOTAL $10,155,040 $ 139,512 $(3,543,826) $ 6,750,726
=========== ========= =========== ===========
FOR THE YEAR ENDED
DECEMBER 31, 1994:
Mining properties $ 6,497,123 $ $ 6,497,123 $
Plant and Equipment 253,603 253,603
----------- --------- ----------- -----------
TOTAL $ 6,750,726 $ -0- $ 6,750,726 $ -0-
=========== ========= =========== ===========
FOR THE YEAR ENDED
DECEMBER 31, 1995:
Mining properties $ -0- $ -0-
Plant and Equipment $ -0- $ -0-
----------- --------- ----------- -----------
TOTAL $ -0- $ -0- $ -0- $ -0-
=========== ========= =========== ===========
PAGE 41
SCHEDULE VI
- -----------
AMERICAN NUCLEAR CORPORATION
- ----------------------------
ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION
OF PROPERTY, PLANT, AND EQUIPMENT
- ----------------------------------------------------
Additions
Balance At Capitalized Balance
Beginning or Retirements at End
Classification of Year Expensed /Other of Year
- -------------- ----------- ----------- ----------- ---------
FOR THE YEAR ENDED
DECEMBER 31, 1993:
Depletion and amor-
tization - Mining
properties $ -0- $ -0-
Depreciation - Plant
and Equipment 142,512 $ 19,371 161,883
----------- ---------- ---------- ---------
TOTAL $ 142,512 $ 19,371 $ -0- $ 161,883
=========== ========== ========== =========
FOR THE YEAR ENDED
DECEMBER 31, 1994:
Depletion and amor-
tization - Mining
properties $ -0- $ -0-
Depreciation - Plant
and Equipment 161,883 $ -0- $ (161,883) -0-
----------- ---------- ---------- ---------
TOTAL $ 161,883 $ -0- $ (161,883) $ -0-
=========== ========== ========== =========
FOR THE YEAR ENDED
DECEMBER 31, 1995:
Depletion and amor-
tization - Mining
properties $ -0- $ -0-
Depreciation - Plant
and Equipment $ -0- $ -0-
----------- ---------- ---------- ---------
TOTAL $ -0- $ -0- $ -0- $ -0-
=========== ========== ========== =========