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UNITED STATES
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO
SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended
June 30, 2002
( ) TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from
to
----------- ------------
Commission File Number 0-1764
AMERICAN
NUCLEAR CORPORATION
(Exact Name of
Registrant In Its Charter)
Colorado
83-0178547
------------------------------
--------------------
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
P. O. Box
2713
Casper,
Wyoming 82602
(Address of principal
executive offices)
(Zip
Code)
Registrant's telephone number,
including area code: (307) 265-7912
Check whether the issuer (1)
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 .
Indicate the number of share
outstanding of each of the issuer's
classes of common stock, as of the
close of the period covered by this
report.
4 cents par value common stock:
7,696,739 shares
PAGE 2
AMERICAN
NUCLEAR CORPORATION
STATEMENTS
OF OPERATION
FOR THE THREE
AND SIX MONTHS ENDED
JUNE 30, 2002
AND JUNE 30, 2001
(UNAUDITED)
Three
Months Ended Six Months Ended
June 30, June 30,
2002
2001 2002 2001
------
------ ------ ------
NET LOSS BEFORE
DISCONTINUED OPERATIONS $
-0- $ -0- $ -0- $
-0-
REVENUE FROM DISCONTINUED
OPERATIONS
Reclamation Reimbursement
13,229 13,519 14,842
13,519
---------- ---------- ----------
----------
Total revenue from
discontinued operations
13,229 13,519 14,842
13,519
DISCONTINUED EXPENSES
General and administrative
4,289 9,236 9,270
12,228
Interest income
(263) (485) (502)
(1,012)
---------- ---------- ----------
----------
Total discontinued
expenses
4,026 8,751 8,768
11,216
NET INCOME (LOSS) $
9,203 $ (4,768) 6,074
2,303
PER SHARE:
NET PROFIT (LOSS) BEFORE
DISCONTINUED OPERATIONS
PER SHARE $
0.00 $ 0.00 $ 0.00 $
0.00
DISCONTINUED OPERATIONS
PER SHARE NET
PROFIT (LOSS) $
0.00 $ 0.00 $ 0.00 $
0.00
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING
7,696,739 7,696,739 7,696,739
7,696,739
DIVIDENDS PER SHARE $
0.00 $ 0.00 $ 0.00 $
0.00
PAGE 3
AMERICAN
NUCLEAR CORPORATION
BALANCE SHEETS
JUNE 30,
2002 AND DECEMBER 31, 2001
June 30, December 31,
2002 2001
(Unaudited) (Unaudited)
-------------- ------------
ASSETS
Current assets:
Cash
$ 85,012 $ 86,938
----------- ------------
Total current assets
$ 85,012 $ 86,938
Other assets:
Other
8,000 -0-
----------- ------------
Total other assets
8,000 -0-
Total assets
$ 93,012 $ 86,938
=========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts payable
-0- -0-
Other current liabilities
-0- -0-
----------- ------------
Total current liabilities
-0- -0-
Common Stockholders' equity:
Common stock
314,080 314,080
Additional paid-in capital
13,304,849 13,304,849
Retained earnings
(12,896,791) (12,902,864)
Less cost of treasury stock
(629,126) (629,126)
----------- ------------
Common stockholders' equity
93,012 86,938
Total liabilities and stockholders'
equity
$ 93,012 $ 86,938
=========== ============
PAGE 4
AMERICAN NUCLEAR CORPORATION
STATEMENTS OF CASH FLOW
FOR THE SIX
MONTHS ENDED JUNE 30, 2002 AND 2001
(UNAUDITED)
Six Months Ended
June 30
2002 2001
---------- ----------
Cash flows from discontinued
operations:
Net loss
$ 6,074 $ 2,302
Adjustments to reconcile net loss to
net
cash used by operating activities:
(Increase) Decrease in other
assets (8,000)
8,000
----------- -----------
Total adjustments
(8,000) 8,000
----------- -----------
Net cash used in operating
activities (1,926)
(5,698)
Net increase (decrease) in cash
during the
period
(1,l926) (5,698)
Cash at the beginning of the period
86,939 94,438
Cash at the end of the period
$ 85,013 $ 87,740
=========== ===========
PAGE 5
AMERICAN
NUCLEAR CORPORATION
NOTES TO
FINANCIAL STATEMENTS
FOR THE
THREE MONTHS ENDED
JUNE 30,
2002 AND 2000
(UNAUDITED)
SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
Liquidation Basis
The accompanying financial
statements have been prepared on a
liquidation basis, which recognized
the realization of assets and the
satisfaction of a portion of the
liabilities. The Company's current
assets exceeded its current
liabilities by $85,012 and $86,938 at
June 30, 2002 and December 31, 2001
respectively. During 1994 the
Company discontinued operations due
to lack of operating capital. For
financial reporting purposes, the
Company has offset contractual
liabilities totaling $392,000.
These liabilities were recognized as
income because the Company has no
means of repaying the obligations
under liquidation basis accounting.
The remaining Company cash
deposits are being utilized to
maintain compliance as long as possible
with U.S. Nuclear Regulatory
Commission (NRC) license requirements
pertaining to the Company's uranium
mining reclamation site. The
Company discontinued the licensing
requirements by transferring this
responsibility to the Wyoming DEQ.
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
$3,213,255 was acquired by the
Wyoming DEQ through forfeiture
proceedings. The state of Wyoming
has consented to perform certain
reclamation obligations, but has
declined to assume the NRC license and
the associated obligations. The
reclamation requirements have changed
to require more work since the bond
forfeiture, and the cash
requirements to continue reclamation
have increased by an undetermined
amount. There is the potential of a
cost overrun in the range of $3
million or considerably more. The
Company has not recognized a
contingent liability for this amount
because the Wyoming DEQ and NRC
have not agreed upon a final
reclamation plan upon which to base
a cost
estimate. By state of Wyoming
statute, the Company is liable for any
cost overruns.
The Company remains liable for
completion of its reclamation
obligations even though it does not
have enough assets with which to
complete those obligations. The NRC
has served the Company with notice
that the Company's deliberate
abandonment of its reclamation site
would
constitute an intentional violation
of the Atomic Energy Act of 1954
and could subject the Company to NRC
enforcement actions and criminal
sanctions. The Company is complying
with a NRC order to maintain and
comply with the terms of its NRC
license. Further, the Company has an
PAGE 6
agreement with the Wyoming DEQ to
maintain its corporate existence in
order to receive Title X reclamation
reimbursement funds from the U.S.
Department of Energy and transfer
agreed upon amounts to the Wyoming
DEQ. The Company has no intention
of entering into other businesses or
continuing its limited operations
beyond the time when it has fulfilled
its obligations under the NRC
license and those required by the
state of
Wyoming.
Interim Financial Statements
The accompanying unaudited
consolidated financial statements have
been prepared in accordance with
generally accepted accounting
principles for interim financial
information and with the instructions
for Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do
not include all of the information
and footnotes required by generally
accepted accounting principles for
complete financial statements. The
accompanying statements should be
read in conjunction with the
unaudited financial statements
included in the Company's Report on
Form
10-K for the year ended December 31,
2001. In the opinion of
management, all adjustments
(consisting only of normal recurring
accruals) considered necessary for a
fair presentation have been
included.
Per Share Amounts
Earnings per share calculations
are computed on the weighted
average number of common shares
outstanding during the respective
periods. Shares under option and
warrants have been disregarded
because their effect is anti-dilutive.
Discontinuance of Operations
Management began seeking a
purchaser for its mining properties in
the third quarter of 1993. While
potential purchasers continued to
express interest, the Company did
not receive any offer greater than
the amount of the debt that was
secured by the mortgage against the
properties. Inability to sell the
mining properties, depletion of
capital and lack of 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 and discharge 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 removed from
listing on the NASDAQ SmallCap
Market. There are no trading markets
for the Company's common stock.
Salt Ridge Energy, Inc., a corporation
PAGE 7
owned by Mr. Salisbury, President,
acquired 2,893,072 shares of common
stock during June 1998 and now owns
37.6% of the Company's
outstanding stock. The Company is
aware of occasional trades on the
electronic bulletin board. The
basis of these transactions is unknown.
MANAGEMENTS
DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Results of Operations
The Company discontinued
operations during May 1994. The
Company had no operating revenues
during the period subject to this
report or the earlier comparable
period. See the Discontinuance of
Operations and the Liquidity and
Capital Resources sections in this
report regarding additional
information about the Company's
cessation of operations.
General and administrative
expenses were $4,289 for the three
months ended June 30, 2002 compared
to $9,236 for the comparable period
ended June 30, 2001.
There was $263 interest income
for the three months of 2002,
compared to $485 for the comparable
period ending June 30, 2001. The
interest is due to the reimbursement
of DOE funds to the Company. These
funds will be used for ongoing
expenses as long as possible.
A net profit of $9,203 was
recognized during the first three
months of 2002 compared to a loss of
$4,768 for the same period in 2001.
The profit in 2002 is due to a
$13,229 DOE reimbursement. The
company does not expect to receive
any more DOE reimbursements in the
future.
Liquidity and Capital Resources
The Company's working capital
at June 30, 2002, was $85,012
while at December 31, 2001 it was
$86,938. The decrease in working
capital at June 30, 2002 was due to
the Company's ongoing general and
administrative expenses. During May
1994, the Company discontinued
operations because of its lack of
funds. Before that decision was made,
the Company attempted to obtain
additional loans, raise equity funds
through a private placement of its
common stock, secure byproduct
disposal contracts, or sell its
mineral properties. None of these
efforts were successful. In
addition, the Wyoming Department of
Environmental Quality (DEQ) declared
forfeiture of the $3.2 million
reclamation bond fund to the DEQ to
be used by the DEQ for completing
reclamation of the Company's Gas
Hills mill site. The total cost of
the reclamation work will not be
known for many years, and the funds
held by the DEQ are not expected to
cover all the expenses. The
Company remains the licensee and
owner of the reclamation site, and
the Company will not be released
from the obligations of reclamation
that are imposed by the license
until reclamation work is completed and
accepted by the regulatory agencies.
The Company has applied, under
PAGE 8
the federal program administered by
the DOE, for reimbursement of some
of the reclamation work it has
previously performed to clean up its
mining and milling site. The DOE
program has been funded by Congress
and money has been allocated for the
reimbursements. The Company
received approximately $46,000 from
this program during 1999 and
approximately $107,000 during 2000,
$13,000 during 2001, and $13,000
during 2002. Under the prevailing
law and the terms of the order of
the U.S. Nuclear Regulatory
Commission that directs the Company
to continue to reclaim and monitor
its reclamation site, the funds and
any future funds that could be
received under this program will be
applied to ongoing monitoring and
reclamation 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
substantially exceed the funds that
become available. The DEQ has
entered into an agreement with the
Company providing that the state
will not bring a deficiency action
in court if the Company transfers
Title X funds to the state to be
applied to the deficiency for use by
the state to perform reclamation.
The Tennessee Valley Authority
(TVA), which had asserted a right to
the funds based on its 1984 contract
with the Company, released the
Company from such claims due to an
agreement between TVA and the state.
The agreement between the Company
and DEQ provides that the Company
and DEQ will use the DOE Title X
funds toward monitoring and
reclamation of the mill site in
accordance with the NRC license.
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934,
the registrant has duly caused this
report to be signed on their behalf
by the undersigned thereunto being
authorized.
AMERICAN NUCLEAR CORPORATION
Registrant
(signature)
August 13, 2002 By:
-----------------------------------
William C. Salisbury
President
(signature)
August 13, 2002 By:
-----------------------------------
Dennis A. Eckerdt
Secretary and Treasurer