UNITED STATES LIME & MINERALS INC, S-3, 2000-11-01

UNITED STATES LIME & MINERALS INC
S-3, 2000-11-01
MINING & QUARRYING OF NONMETALLIC MINERALS (NO FUELS)

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 1, 2000

REGISTRATION NO. 333-[ ]
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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UNITED STATES LIME & MINERALS, INC.
(Exact name of Registrant as specified in its charter)

<TABLE>
<S> <C>
TEXAS 75-0789226
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
</TABLE>

13800 MONTFORT DRIVE, SUITE 330
DALLAS, TEXAS 75240
(972) 991-8400
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
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HERBERT G.A. WILSON
PRESIDENT AND CHIEF EXECUTIVE OFFICER
UNITED STATES LIME & MINERALS, INC.
13800 MONTFORT DRIVE, SUITE 330
DALLAS, TEXAS 75240
(972) 991-8400
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
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Copies to:

GEORGE G. YEARSICH, ESQ.
SUSAN K. CHASNOV, ESQ.
MORGAN, LEWIS & BOCKIUS LLP
1800 M STREET, N.W.
WASHINGTON, DC 20036
(202) 467-7000

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this registration statement.

If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered in connection with dividend or interest
reinvestment plans, check the following box. [X]

If this form is filed to register additional securities for an offering
pursuant to Rule 426(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of earlier effective
registration statement the same offering. [ ]
---------------

If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
---------------

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

CALCULATION OF REGISTRATION FEE

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PROPOSED MAXIMUM AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED AGGREGATE OFFERING PRICE REGISTRATION FEE(2)
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Rights to Purchase Shares of Common Stock(1)................ N/A N/A
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Common Stock, par value $0.10 per share..................... $10,000,000 $2,640
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</TABLE>

(1) Pursuant to Rule 457(g) under the Securities Act, no separate registration
fee is required for the rights since they are being registered in the same
registration statement as the common stock underlying the rights.

(2) The registration fee has been calculated in accordance with Rule 457(o)
under the Securities Act.

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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
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<PAGE> 2

The information in this prospectus is not complete and may be changed. A
registration statement relating to these securities has been filed with
the Securities and Exchange Commission. We may not sell these securities
until the registration statement is effective. This prospectus is not an
offer to sell, and it is not soliciting an offer to buy, these securities
in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION

UNITED STATES LIME & MINERALS, INC.

SHARES OF COMMON STOCK
ISSUABLE UPON EXERCISE OF SUBSCRIPTION RIGHTS
United States Lime & Minerals, Inc. is distributing non-transferable
subscription rights in this rights offering to persons who owned shares of our
common stock on [November ], 2000.

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<CAPTION>
PROCEEDS TO
SUBSCRIPTION EXERCISE UNITED STATES LIME &
PRICE MINERALS, INC.(1)
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<S> <C> <C>
Per Share................................................... $ [ ] $[ ]
Total....................................................... $ [ ] $[10,000,000]
</TABLE>

(1) Before deducting expenses payable by us, estimated to be [ ].
---------------------

THE EXERCISE OF THE SUBSCRIPTIONS RIGHTS INVOLVES SUBSTANTIAL RISK. FOR A
DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN EVALUATING AN
INVESTMENT IN THE SECURITIES OFFERED HEREBY, SEE "RISK FACTORS," BEGINNING ON
PAGE 6 OF THIS PROSPECTUS.
---------------------

You will receive [ ] subscription rights for each share of common stock
that you owned on [ ], 2000. You will not receive any fractional
rights. Each subscription right entitles you to purchase one share of common
stock at the purchase price of [ ] per share. If you exercise all of your
subscription rights, you may also have the opportunity to purchase additional
shares at the same purchase price.

The subscription rights are exercisable beginning on the date of this
prospectus and continuing until 5:00 p.m., Eastern Standard Time on [
], 2000. If you want to participate in the rights offering, we recommend that
you submit your subscription documents to the subscription agent before that
deadline or to your broker or bank at least 10 days before that deadline. Please
see page 15 for further instructions on submitting subscriptions. All
subscriptions will be in escrow by our subscription agent, Harris Trust Company
of New York, through the expiration date of the rights offering. We reserve the
right to cancel the rights offering at any time before the expiration. There is
no minimum number of shares that we must sell in order to complete the rights
offering. Shareholders who do not participate in the rights offering will
continue to own the same number of shares, but will own a smaller percentage of
the total shares outstanding to the extent that other shareholders participate
in the rights offering.

The subscription rights may not be sold or transferred. The subscription
rights will not be listed for trading on Nasdaq or any stock exchange.

Inberdon Enterprises Ltd., the majority shareholder of United States Lime &
Minerals, has expressed its willingness to fully exercise its basic subscription
rights, and to purchase the remainder of the shares that are not fully
subscribed for by other shareholders, in the rights offering.

Shares of the our common stock are quoted on the Nasdaq National Market
under the symbol "USLM." The last sale price of our common stock on [November
], 2000 was $[ ].

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this prospectus is
<PAGE> 3

TABLE OF CONTENTS

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Prospectus Summary.......................................... 1
Questions and Answers About United States Lime &
Minerals............................................... 1
Questions and Answers About the Rights Offering........... 1
Risk Factors................................................ 6
Risks Associated with the Offering of Subscription
Rights................................................. 6
Risk Factors Relating to United States Lime & Minerals.... 7
Recent Developments......................................... 8
Banking Facilities.......................................... 9
Existing Debt............................................. 9
New Debt.................................................. 9
About United States Lime & Minerals......................... 10
About the Lime Industry..................................... 12
About the Rights Offering................................... 12
The Subscription Rights................................... 12
Basic Subscription Privilege.............................. 13
Over-Subscription Privilege............................... 13
Purchase Commitments...................................... 14
No Recommendations........................................ 14
Expiration Date........................................... 14
Cancellation Right........................................ 14
Determination of Subscription Price....................... 14
Non-Transferability of Subscription Rights................ 14
Exercise of Subscription Rights........................... 15
Method of Payment......................................... 15
Guaranteed Delivery Procedures............................ 15
Signature Guarantees...................................... 16
Shares Held for Others.................................... 16
Ambiguities in Exercise of Subscription Rights............ 16
Regulatory Limitation..................................... 17
Our Decision Binding...................................... 17
No Revocation............................................. 17
Shares of Common Stock Outstanding After the Rights
Offering............................................... 17
Capitalization Table...................................... 18
Fees and Expenses......................................... 18
Subscription Agent........................................ 18
If you Have Questions....................................... 19
Description of Common Stock................................. 19
Use of Proceeds............................................. 19
Determination of Offering Price............................. 19
Plan of Distribution........................................ 20
Federal Income Tax Considerations........................... 20
Taxation of Shareholders.................................. 20
Taxation of United States Lime & Minerals................. 21
State and Foreign Securities Laws........................... 21
Legal Matters............................................... 21
Experts..................................................... 21
If You Would Like More Information.......................... 21
</TABLE>

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PROSPECTUS SUMMARY

This section answers in summary form some questions you may have about
United States Lime & Minerals, Inc. and this rights offering. The information in
this section is not complete and does not contain all of the information that
you should consider before exercising your subscription rights. You should read
the entire prospectus carefully, including the "Risk Factors" section and the
documents listed under "If You Would Like More Information."

QUESTIONS AND ANSWERS ABOUT UNITED STATES LIME & MINERALS

WHAT IS UNITED STATES LIME & MINERALS, INC.?

United States Lime & Minerals was incorporated in 1950. Our business is the
production and sale of lime and limestone products. We extract high-quality
limestone from our quarries and process it for sale as pulverized limestone,
quicklime, and hydrated lime. We conduct our operations at three wholly-owned
subsidiaries: Arkansas Lime Company, Texas Lime Company, and Colorado Lime
Company.

WHERE ARE WE LOCATED?

Our principal executive offices are located at:

United States Lime & Minerals, Inc.
13800 Montfort Drive, Suite 330
Dallas, Texas 75240

QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING

WHAT IS A RIGHTS OFFERING?

A rights offering is an opportunity for you to purchase additional shares
of common stock at a fixed price and in an amount proportional to your existing
interest, which enables you to maintain and possibly increase your current
percentage ownership.

WHAT IS A SUBSCRIPTION RIGHT?

We are distributing to you, at no charge, [ ] subscription rights for
every share of common stock that you owned on [November ], 2000. We will not
distribute any fractional subscription rights, but will round the number of
subscription rights you receive down to the nearest whole number. Each
subscription right entitles you to purchase one share of common stock for
$[ ]. When you "exercise" a subscription right, that means that you choose
to purchase the number of shares of common stock that each subscription right
entitles you to purchase. You may exercise any number of your subscription
rights, or you may choose not to exercise any subscription rights. You cannot
give or sell your subscription rights to anybody else -- only you can exercise
them. See "About the Rights Offering -- The Subscription Rights."

WHAT IS THE BASIC SUBSCRIPTION PRIVILEGE?

The basic subscription privilege of each subscription right entitles you to
purchase one share of our common stock at a subscription price of $[ ]. See
"About the Rights Offering -- Basic Subscription Privilege."

WHAT IS THE OVER-SUBSCRIPTION PRIVILEGE?

We do not expect that all of our shareholders will exercise all of their
basic subscription privileges. By extending over-subscription privileges to our
shareholders, we are providing for the purchase of those shares which are not
purchased through exercise of basic subscription privileges. The
over-subscription privilege of each subscription right entitles you, if you
fully exercise your basic subscription privilege, at the same time to subscribe
for additional shares of common stock at a subscription price of $[ ] per
share. See "About the Rights Offering -- Over-Subscription Privilege."

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WHAT ARE THE LIMITATIONS ON THE OVER-SUBSCRIPTION PRIVILEGE?

If sufficient shares are available, we will honor the over-subscription
requests in full. If over-subscription requests exceed the number of shares
available, we will allocate all or a portion of the available shares among
shareholders who over-subscribed in proportion to the number of shares purchased
by those over-subscribing shareholders through the exercise of their basic
subscription privilege. Inberdon Enterprises has expressed its willingness not
to subscribe for shares pursuant to the over-subscription privilege. See "About
the Rights Offering -- Over-Subscription Privilege."

WHY ARE WE ENGAGING IN A RIGHTS OFFERING?

We are offering the subscription rights to obtain additional equity capital
which, together with increased bank borrowings (see "Banking Facilities"),
should enable us to construct Phase II of the Arkansas expansion and
modernization project ("Arkansas Phase II"), and provide us with ongoing working
capital. Any excess funds will be utilized for general corporate purposes. We
have intended to finance Arkansas Phase II through a combination of internally
generated funds, additional bank borrowings, and/or other sources of capital.
Given the lower than expected operating income generated in the second and third
quarters of this year, as well as the increased costs of the Arkansas project,
our Board has determined to seek to raise additional equity capital through this
rights offering to our existing shareholders, and to seek an additional
seven-year, $7,000,000 term loan, which is conditioned on our raising at least
$5,000,000 in new equity. Our Board has chosen to give existing shareholders the
opportunity to buy more shares to provide us with additional equity, rather than
selling additional shares of common stock to others. Of course, we cannot assure
you that we will not need to seek additional financing in the future. See "Risk
Factors -- Capital Requirements; Uncertainty of Additional Funding."

HOW MANY SHARES MAY I PURCHASE?

You will receive [ ] subscription rights for each share of common stock
that you owned on [November ], 2000. We will not distribute fractional
subscription rights, but will round the number of subscription rights you are to
receive down to the nearest whole number. Each subscription right entitles you
to purchase one share of common stock for $[ ]. See "About the Rights
Offering -- Basic Subscription Privilege." If you exercise all of the
subscription rights that you receive, you may have the opportunity to purchase
additional shares of common stock. On the attached subscription certificate, you
may request to purchase as many additional shares as you wish for $[ ] per
share. We may honor all of these over-subscription requests, but if not, you may
not be able to purchase as many shares as you requested on your subscription
certificate. Subject to state securities laws and regulations, we have the
discretion to issue less than the total number of shares that may be available
for over-subscription requests in order to comply with state securities laws.
See "About the Rights Offering -- Over-Subscription Privilege."

HOW DID WE ARRIVE AT THE $[ ] PER SHARE PRICE?

Our Board of Directors, excluding the director affiliated with Inberdon,
set all of the terms and conditions of the rights offering, including the price
per share. In determining the price per share during the rights offering, our
Board of Directors, excluding the director affiliated with Inberdon, considered
several factors, including the current and historical market prices of the
common stock, our book value per share, our business prospects, general
conditions in the securities market, our need for capital, alternatives
available to us for raising capital, the amount of proceeds desired, pricing of
similar transactions, the liquidity of our common stock, the level of risk to
our shareholders, and the need to offer shares at a price that would be
acceptable to Inberdon and attractive to our other shareholders relative to the
current trading price of our common stock. See "About the Rights
Offering -- Determination of Subscription Price."

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HOW DO I EXERCISE MY SUBSCRIPTION RIGHTS?

You must properly complete the attached subscription certificate and
deliver it to the Subscription Agent before 5:00 p.m., Eastern Standard Time on
[ ], 2000. The address for the Subscription Agent is on page 18. See "About
the Rights Offering -- Exercise of Subscription Rights."

HOW DO I PAY FOR MY SHARES?

Your subscription certificate must be accompanied by proper payment for
each share that you wish to purchase pursuant to both your basic and
over-subscription privileges. See "About the Rights Offering -- Method of
Payment."

HOW LONG WILL THE RIGHTS OFFERING LAST?

You will be able to exercise your subscription rights only during a limited
period. IF YOU DO NOT EXERCISE YOUR SUBSCRIPTION RIGHTS BEFORE 5:00 P.M.,
EASTERN STANDARD TIME, ON [ ], 2000, THE SUBSCRIPTION RIGHTS WILL EXPIRE. We
may, in our discretion, decide to extend the rights offering. In addition, if
the commencement of the rights offering is delayed, the expiration date will
similarly be extended. See "About the Rights Offering -- Expiration Date."

WHAT IF MY SHARES ARE NOT HELD IN MY NAME?

If you are a beneficial owner of common stock held by a holder of record,
such as a broker, trustee or a depository for securities, you should contact the
holder and ask him or her to effect transactions in accordance with your
instructions. Notwithstanding the above, if you are a current or former employee
of ours who beneficially owns shares of our common stock which are held in our
401(k) plan (formerly the ESOP), we will treat those shares as part of your
record ownership for purposes of calculating your subscription rights. See
"About the Rights Offering -- Shares Held for Others."

AFTER I EXERCISE MY SUBSCRIPTION RIGHTS, CAN I CHANGE MY MIND?

No. Once you send in your subscription certificate and payment, you cannot
revoke the exercise of your subscription rights, even if you later learn
information about us that you consider to be unfavorable. You should not
exercise your subscription rights unless you are certain that you wish to
purchase additional shares of common stock at a price of $[ ] per share. See
"About the Rights Offering -- No Revocation."

IS EXERCISING MY SUBSCRIPTION RIGHTS RISKY?

The exercise of your subscription rights involves various risks. Exercising
your subscription rights means buying additional shares of our common stock and
should be carefully considered as you would view any other equity investment.
Among other things, you should carefully consider the risks described under the
heading "Risk Factors," beginning on page 6.

WHAT HAPPENS IF I CHOOSE NOT TO EXERCISE MY SUBSCRIPTION RIGHTS?

You will retain your current number of shares of common stock even if you
do not exercise your subscription rights. However, if other shareholders
exercise their subscription rights and you do not, the percentage of United
States Lime & Minerals that you own will diminish, and your voting and other
rights will be diluted. See "Risk Factors -- Dilution of Your Percentage
Ownership of United States Lime & Minerals, Inc."

CAN I SELL OR GIVE AWAY MY SUBSCRIPTION RIGHTS?

No.

3
<PAGE> 7

MUST I EXERCISE ANY SUBSCRIPTION RIGHTS?

No.

WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF EXERCISING MY SUBSCRIPTION
RIGHTS?

The receipt and exercise of your subscription rights are intended to be
nontaxable. You should seek specific tax advice from your personal tax advisor.
See "Federal Income Tax Considerations -- Taxation of Shareholders."

WHEN WILL I RECEIVE MY NEW SHARES?

If you purchase shares of common stock through the rights offering, you
will receive certificates representing those shares as soon as practicable after
[ ], 2000.

CAN WE CANCEL THE RIGHTS OFFERING?

Yes. The Board of Directors, excluding the director affiliated with
Inberdon, may cancel the rights offering at any time, on or before [ ],
2000, for any reason. If we cancel the rights offering, any money received from
shareholders will be refunded promptly. See "About the Rights
Offering -- Cancellation Right."

HOW MUCH MONEY WILL UNITED STATES LIME & MINERALS RECEIVE FROM THE RIGHTS
OFFERING?

Our gross proceeds from the rights offering depend on the number of shares
that are purchased. If we sell all [ ] shares offered by this prospectus,
then we will receive proceeds of $10,000,000.

To guarantee us $10,000,000 in proceeds from the rights offering, our
majority shareholder, Inberdon, has expressed its willingness to exercise its
basic subscription rights in full, and if the rights offering is
undersubscribed, to purchase the remainder of the shares that are not fully
subscribed for by other shareholders. Additionally, Inberdon has expressed its
willingness not to subscribe for shares pursuant to its over-subscription
privilege, thus stepping back to allow other fully subscribing shareholders to
purchase additional shares if they wish.

Upon completion of the rights offering, Inberdon will own between 51% and
[ ]% of our outstanding common stock depending on whether other shareholders
exercise their subscription rights.

As a result of Inberdon's willingness to backstop the rights offering, we
expect to receive proceeds of $10,000,000 from the rights offering, even if no
other shareholders exercise their rights. See "About the Rights
Offering -- Purchase Commitments."

HOW WILL WE USE THE PROCEEDS FROM THE RIGHTS OFFERING?

We will use the proceeds from the rights offering, together with increased
bank borrowings, to provide $5,000,000 in additional equity capital for use in
the construction of Arkansas Phase II and additional working capital. Any excess
will be used for general corporate purposes. See "Use of Proceeds."

HOW MANY SHARES WILL BE OUTSTANDING AFTER THE RIGHTS OFFERING?

The number of shares of common stock that will be outstanding after the
rights offering depends on the number of shares that are purchased. If we sell
all of the shares offered by this prospectus, then we will issue [ ] new
shares of common stock during the rights offering. In that case, we will have
approximately [ ] shares of common stock outstanding after the rights
offering. Even if no other shareholders exercise their subscription rights,
Inberdon has expressed its willingness to purchase all [ ] shares of common
stock from us in the rights offering, in which case we will have approximately
[ ] shares of common stock outstanding after the rights offering.

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WHAT IF I HAVE MORE QUESTIONS?

If you have more questions about the rights offering, please contact our
Vice President of Finance, Corporate Controller and Secretary, Larry T. Ohms,
13800 Montfort Drive, Suite 330, Dallas, Texas 75240, Telephone: 972-991-8400.
See "If You Have Questions."

A WARNING ABOUT FORWARD-LOOKING STATEMENTS

Any statements contained in this prospectus that are not statements of
historical fact are forward-looking statements as defined in the Private
Securities Litigation Reform Act of 1995. Forward-looking statements in this
prospectus, including without limitation, statements relating to our plans,
strategies, objectives, expectations, intentions, and adequacy of resources, are
identified by such words as "will," "could," "should," "believe," "expect,"
"intend," "plan," "schedule," "estimate," and "project." We undertake no
obligation to publicly update or revise any forward-looking statements. You are
cautioned that forward-looking statements involve risks and uncertainties that
could cause actual results to differ materially from expectations, including
without limitation the following: (i) our plans, strategies, objectives,
expectations, and intentions are subject to change at any time at our
discretion; (ii) our plans and results of operations will be affected by our
ability to manage our growth and modernization; and (iii) other risks and
uncertainties set forth below or indicated from time to time in our filings with
the Securities and Exchange Commission.

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<PAGE> 9

RISK FACTORS

Investing in United States Lime & Minerals' common stock involves certain
risks. You should be able to bear a complete loss of your investment. You should
carefully consider the following factors and other information in this
prospectus before deciding to invest in, or make further investments in, our
common stock.

RISKS ASSOCIATED WITH THE OFFERING OF SUBSCRIPTION RIGHTS

Dilution of your percentage ownership of United States Lime & Minerals. If
you do not exercise all of your subscription rights, you may suffer significant
dilution of your percentage ownership of United States Lime & Minerals relative
to shareholders who exercise their subscription rights. For example, if you own
[ ] shares of common stock before the rights offering, or [ ]% of the
equity of United States Lime & Minerals, and you exercise none of your
subscription rights while all other subscription rights are exercised through
the basic subscription privilege or over-subscription privilege, then your
percentage ownership will be reduced to [ ]%.

Risks associated with exercising subscription rights. We cannot assure you
that the public trading market price of our common stock will not decline before
the subscription rights expire. If you exercise your subscription rights and
then the public trading market price of the common stock decreases below
$[ ], then you will have committed to buy shares of common stock at a price
above the prevailing market price. Moreover, we cannot assure you that following
the exercise of subscription rights you will be able to sell your shares of
common stock at a price equal to or greater than the subscription price. Until
certificates are delivered upon expiration of the rights offering, you may not
be able to sell the shares of our common stock that you purchase in the rights
offering. Certificates representing shares of our common stock that you
purchased will be delivered as soon as practicable after expiration of the
rights offering. We will not pay you interest on funds delivered to the
Subscription Agent pursuant to the exercise of rights.

No revocation of exercise of subscription rights. Once you exercise your
subscription rights, you may not revoke the exercise.

Cancellation of rights offering. If we elect to cancel the rights offering,
neither we nor the Subscription Agent will have any obligation with respect to
the subscription rights except to return, without interest, any subscription
payments.

Determination of the subscription price. Our Board of Directors, excluding
the director affiliated with Inberdon, set all of the terms and conditions of
the rights offering, including the subscription price. The subscription price
does not necessarily bear any relationship to the book value of our assets, past
operations, cash flows, financial condition or any other established criteria
for value. You should not consider the subscription price as an indication of
the value of United States Lime & Minerals or our common stock. See "About the
Rights Offering -- Determination of Subscription Price."

Volatility of stock price. Based on the trading history of our common
stock, we believe that certain factors cause the market price of our stock to
fluctuate significantly. These factors include, without limitation:

- quarterly fluctuations in our financial results;

- general economic conditions and the impact of government programs such as
the Transportation Equity act for the 21st Century;

- market conditions in the lime industry, and in the industries that
purchase our products;

- changes in relationships with our customers; and

- the size of the public float of our common stock (which will depend, in
part, on the number of shares of common stock purchased or acquired by
you and other shareholders in the rights offering).

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<PAGE> 10

Control by major shareholder. As of [November ], 2000, Inberdon owned
approximately [51]% of our voting stock. The rights offering could, and in fact
is likely to, result in Inberdon owning an even greater percentage of our common
stock. Inberdon has enough votes to approve or disapprove any matters that are
determined by a majority vote of our shareholders, and accordingly your ability
to influence United States Lime & Minerals through voting your shares is
limited.

RISK FACTORS RELATING TO UNITED STATES LIME & MINERALS

Existing and future adverse effects of leverage and restrictions imposed by
terms of our indebtedness. Following the closing of this offering and the New
Loan (see "Banking Facilities -- New Debt") facility our debt ratio is expected
to have improved (see "About the Rights Offering -- Capitalization Table"),
although the total debt may be greater than it has been to date. The greater
total debt may mean that a substantial portion of our cash flows from operations
may be dedicated to the payment of principal and interest on indebtedness. Our
ability to service our debt and to comply with the financial and restrictive
covenants contained in our loan agreements will depend upon our future
performance and business growth. Performance and growth, in turn, are subject to
financial, economic, competitive, and other factors. Many of these factors are
beyond our control. In particular, our ability to service our indebtedness will
depend upon our ability to generate higher levels of revenues and cash flows
through the modernization and expansion of the Texas and Arkansas plants. While
we believe that we will be able to generate sufficient cash flow to cover our
current and anticipated future debt service payments, we cannot provide any
assurance to that effect.

Compliance with environments laws and regulations. Our operations are
subject to various federal, state, and local environmental laws and regulations,
including the Clean Air Act, the Clean Water Act, the Resource Conservation and
Recovery Act, and the Comprehensive Environmental Response, Compensation, and
Liability Act, as well as the Toxic Substances Control Act. The rate of change
of such legislation has been rapid over the last decade, and compliance can
require significant expenditures. For example, recent federal legislation
required Texas Lime Company and Arkansas Lime Company to apply for "Title V"
renewable operating permits ("Operating Air Permits") which have significant
on-going compliance monitoring costs. While we cannot be certain that we will
always be able to comply with changing requirements without a material impact on
our business, we are not aware of any such impending change.

In September 1999, we received an Operating Air Permit for Phase I of the
modernization and expansion project for the Arkansas facility. In June 2000, we
received a second Operating Air Permit for Arkansas Phase II. These permits
cover air emissions generated at the facility and contain stringent emission
limits and performance criteria that the new rotary lime kilns and plant must
meet. Until both kilns are fully operational and have demonstrated their ability
to comply with the permit conditions, there can be no assurance that additional
capital will not be required, or operating conditions imposed, in order to
achieve compliance.

Completion of Phase II of the Arkansas expansion. The construction of the
Arkansas project could also have a material adverse effect on our business or
financial results due to the impact of start-up costs and the potential for
under-utilization, especially in the start-up phase. No assurance can be given
that the expansion of the Arkansas facility will be completed on time or within
current budget projections, and may be abandoned due to these or other issues.
Further, we cannot guarantee that we will be able to sell our products, or
reestablish accounts with those customers that previously purchased products
from Arkansas Lime, once increased production has commenced, or that any such
sales will be profitable. We may be required to obtain additional debt financing
should the actual costs of the Arkansas project exceed our available funds. We
may decide to incur additional debt or issue additional equity securities to pay
for construction or other expansion costs, which could have a further material
adverse dilutive effect on the ownership interests of our current stockholders.

Competition. The lime industry is highly regionalized and competitive. Our
competitors include both public and private companies. The primary competitive
factors in the lime industry are quality, price,

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proximity to the customer, personal relationships, and timeliness of deliveries,
with varying emphasis on these factors depending upon the specific product
application. To the extent that one or more of our competitors becomes more
successful with respect to any key competitive factor, our business could be
materially adversely affected. Although demand for lime has been relatively
strong in recent years, we are unable to predict future demand and prices, and
we cannot provide any assurance that current levels of demand and pricing will
continue or that any future price increases can be sustained.

Industry consolidation. There is a continuing trend of consolidation in the
lime and limestone industry. Currently, the four largest lime companies in North
America account for approximately 70% of total lime capacity. In addition to,
and often in conjunction with, consolidations, many producers have undergone
modernization and expansion projects to upgrade their processing equipment in an
effort to improve their operating efficiency and competitive position. As
industry consolidation continues, we will continue to evaluate external
opportunities for expansion, as well as pursue our modernization and expansion
projects, in an effort to remain competitive, protect our markets, and position
ourself for the future. We cannot provide any assurance that we will have
sufficient financial and management resources to implement our strategy,
particularly while we are endeavoring to complete the Arkansas project.
Therefore, we may be required to revise our strategy, or otherwise find ways to
enhance our value for stockholders, including by entering into strategic
partnerships, mergers, or other transactions that may result in a change of
control of our company.

RECENT DEVELOPMENTS

During the first nine months of 2000, our operating results have been
adversely affected by a number of factors, which include rapidly increasing fuel
costs, particularly natural gas, lower sales of pulverized limestone used in
roofing products, and unprecedented flooding at the Texas Lime Company in June.
Actions have been taken to mitigate these adverse factors which, together with
the new production facilities under construction, should significantly improve
net income in 2001.

The high natural gas cost has impacted the results of Arkansas Lime
Company, increasing operating losses because the old vertical kilns could only
burn gas. The new Phase I rotary kiln, which began operation on October 22,
2000, has resolved this issue because it is permitted to burn coal or coke, and
the old kilns were permanently closed on October 20, 2000, one month later than
originally estimated. At Texas Lime Company, multi-fuel options are permitted,
and coal has now been substituted for gas to the greatest extent possible.

The June flooding in Texas was the result of exceptional rainfall,
subsequently confirmed by the National Weather Service to be the heaviest
monthly total in the area for 113 years. The floods caused a significant loss of
production, the depletion of finished goods inventories, and lead to increased
costs through purchasing lime from outside sources to fulfill customer
commitments. There was no long-term damage, and the plant was back in full
production in July. We have retained our customer base and expect to rebuild to
the normal level of finished goods inventories before the fiscal year-end.
Inclement weather on this scale is unusual, and we have completed considerable
site work to minimize the impact of similar events, should they occur.

At the beginning of the fourth quarter 2000, we commissioned a new line for
the production of pulverized limestone at Texas Lime Company. At a cost of $1.8
million, this investment will allow us to pursue new business opportunities and
better serve existing customers. The lack of reliability of a single production
line was a restraining factor on sales to several large customers requiring
'round-the-clock' availability. The production operations at Texas Lime are
highly integrated, and increasing the level of pulverized limestone production
along with the recent increases in lime capacity, allows for a lower level of
production cost to be achieved.

We now estimate that total capital expenditures for Phase I of the Arkansas
project will be approximately $30,000,000, approximately $1,300,000 over the
estimate stated in our second quarter 2000 Form 10-Q of $28,700,000. This total
includes an increased scope of work, the benefit of which will be to

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<PAGE> 12

reduce future operating costs, and also includes approximately $1,000,000 of
costs incurred for certain facilities that were pre-built for Phase II of the
project, as it was cost-effective to construct those facilities concurrently
with Phase I. In addition, the increased costs of Phase I reflect additional
construction costs from delayed completion of certain facilities, as well as our
reduced ability to attract competitive bids for the later stages of the project
due to the continued high level of construction activity in the area.

Arkansas Phase II is estimated to cost approximately $12,000,000. However,
we have determined to delay the start of Arkansas Phase II, and currently plan
to commence construction in mid-year 2001, subject to market demand, ability to
secure competitive bids, and the availability of financing.

We have intended to finance Arkansas Phase II through a combination of
internally generated funds, additional bank borrowings, and/or other sources of
capital. Given the lower than expected operating income generated in the second
and third quarters of this year, as well as the increased costs of the Arkansas
project, our Board of Directors has determined to seek to raise additional
equity capital through this rights offering to our existing shareholders, and to
seek an additional seven-year, $7,000,000 term loan, which is contingent on our
raising at least $5,000,000 in new equity. In the Board's view, the additional
financings will enable us to proceed with Phase II of the Arkansas project, and
provide us with ongoing working capital. In the view of our Board, we should
proceed with Arkansas Phase II in order to achieve maximum utilization of the
infrastructure completed there to date, thus maximizing our rate of return on
that investment, by approximately doubling the capacity of the Arkansas plant
for an incremental investment of approximately $12,000,000.

BANKING FACILITIES

EXISTING DEBT

We have a $50,000,000 Senior Secured Term Loan (the "Loan"), provided by a
consortium of commercial banks, which was fully drawn down on March 30, 2000.
The Loan was used to repay all existing bank loans, with the balance principally
used to fund Phase I of the Arkansas project. Monthly principal payments of
$277,778 began on April 30, 2000, and will terminate on March 30, 2007, when a
final payment of $26,944,444 is due. The interest rate is fixed at a weighted
average rate of 9.135%, in addition to which, we pay a servicing fee of 0.125%
of the outstanding principal. The Loan is secured by a first lien on
substantially all of our assets with the exception of accounts receivable and
inventories.

We also have a $4,000,000 revolving credit facility (the "Revolver")
provided by the lead bank of the Loan consortium and secured by accounts
receivable and inventories. The Revolver bears interest at LIBOR plus 1.40%,
which rate will increase in accordance with a defined rate spread based upon our
then-current rate of total funded debt to earnings before interest, taxes,
depreciation and amortization (EBITDA). The Revolver expires on April 20, 2001,
and at October 31, 2000, we had not drawn down any funds under this facility,
but we anticipate drawing down the full amount by January 31, 2001 because of
the impact of increased construction costs, higher start-up costs, and lower
than expected operating income.

NEW DEBT

We have received the support in principle of our lead bank to provide an
additional seven-year, $7,000,000 term loan facility to be used for the Arkansas
Phase II (the "New Loan"). The bank has issued a draft term sheet for the New
Loan which contains certain conditions precedent to be met before the funds can
be advanced. We believe that we will be able to satisfy these conditions
precedent; however, there can be no guarantee of this and, if we are unable to
do so, then the Company may have to seek alternative sources of financing to
complete Arkansas Phase II.

The principal terms and conditions of the proposed New Loan are:

- we must raise a minimum of $5,000,000 of new equity capital, net of
costs, concurrently with, or prior to, the closing of the New Loan;
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- the consortium of banks that provided the Loan must consent to a second
mortgage on the Arkansas facility and certain other amendments to the
security and intercreditor agreements; and

- the New Loan is expected to bear interest at the rate of LIBOR plus 3.0%
per annum with a seven-year amortization of principal. Interest only will
be payable during the first twelve months of the facility.

ABOUT UNITED STATES LIME & MINERALS

United States Lime & Minerals, Inc. was incorporated in 1950. Our business
is the production and sale of lime and limestone products. We extract
high-quality limestone from our quarries and process it for sale as pulverized
limestone, quicklime, and hydrated lime. We conduct our operations through three
wholly-owned subsidiaries: Arkansas Lime Company, Texas Lime Company, and
Colorado Lime Company.

We extract raw limestone and then processes it for sale as pulverized
limestone, quicklime, and hydrated lime. Pulverized limestone, also referred to
as ground calcium carbonate, is a dried product ground to granular and finer
sizes. Quicklime (calcium oxide) is produced by heating limestone to very high
temperatures in kilns in a process called calcination. Hydrated lime (calcium
hydroxide) is produced by reacting quicklime with water in a controlled process
to produce a dry, white powder.

Pulverized limestone is used primarily in the production of construction
materials such as asphalt paving and roofing shingles, as an additive to
agriculture feeds, as a soil enhancement, and for mine safety dust in coal
mining operations. Quicklime is used primarily in the manufacturing of paper
products, in sanitation and water filtering systems, in metal processing, and in
soil stabilization for highway and building construction. Hydrated lime is used
primarily in municipal sanitation and water treatment, in soil stabilization for
highway and building construction, in the production of chemicals, and in the
production of construction materials such as stucco, plaster and mortar.

Our principal customers for lime and limestone products are highway, street
and parking lot contractors, chemical producers, paper manufacturers, roofing
shingle manufacturers, steel producers, glass manufacturers, municipal
sanitation and water treatment facilities, poultry and cattle feed producers,
governmental agencies, and electric utility companies. We transport our lime and
limestone products by rail and truck to customers generally within a radius of
400 miles of each of our processing plants. Substantially all of our sales are
made within the United States, with a majority of our product sales occurring in
the states of Arkansas, Colorado, Kansas, Louisiana, Mississippi, Missouri, New
Mexico, Oklahoma, Tennessee, and Texas. Approximately 700 customers accounted
for our sales of lime and limestone products during the year ended December 31,
1999. No single customer accounted for more than 10% of such sales. We are not
subject to significant customer risks because our customers are considerably
diversified as to geographic location and industrial concentration. However,
given the capital intensive nature of the lime and limestone industry, our
profits are very sensitive to changes in sales volume.

Our sales have historically reflected seasonal trends, with the largest
percentage of total annual revenues being realized in the second and third
quarters. Lower seasonal demand normally results in reduced shipments and
revenues in the first and fourth quarters. Inclement weather conditions
generally have a negative impact on the demand for lime and limestone products.

Two of our subsidiaries currently extract limestone from open-pit quarries:
the Texas Lime Company, which is located 14 miles from Cleburne, Texas; and the
Arkansas Lime Company, which is located near Batesville, Arkansas. A third
subsidiary, the Colorado Lime Company, owns limestone resources at Monarch Pass
located 15 miles west of Salida, Colorado.

Texas Lime Company operates upon a tract of land containing approximately
470 acres, including the Cleburne Quarry. In January 1999, we purchased
approximately 400 acres of additional land and now own approximately 2,700 acres
adjacent to the quarry. Both the quarry and the adjacent land contain known

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<PAGE> 14

high-quality limestone reserves in a bed averaging 28 feet in thickness, with an
overburden that ranges from 0 to 50 feet. We also have mineral interests in
approximately 560 acres of land adjacent to the northwest boundary of that
property. The calculated reserves, as of January 31, 1999, were approximately
44,000,000 tons of proven reserves and approximately 91,000,000 tons of probable
reserves. Assuming the enhanced level of production following the Texas
modernization and expansion project is maintained, we estimate that these
reserves are sufficient to sustain operations for approximately 100 years.

Arkansas Lime Company operates the Batesville Quarry and has lime and
limestone production facilities on a second site linked to the quarry by its own
light-gauge railroad. The active quarry operations cover approximately 725 acres
of land containing a known deposit of high-quality limestone. The average
thickness of the high-quality limestone deposit is approximately 70 feet, with
an average overburden thickness of 35 feet. We also own approximately 325
additional acres containing additional high-quality limestone deposits adjacent
to the present quarry but separated from it by a public highway. The average
thickness of this second high-quality limestone deposit is approximately 55
feet, with an average overburden of 20 feet. The calculated reserves, as of
January 31, 1999, were approximately 23,500,000 tons of proven reserves plus an
additional 33,500,000 tons of probable reserves. Assuming the present level of
production is maintained, we estimate that reserves are sufficient to sustain
operations for approximately 100 years. However, this estimate is reduced to 50
years assuming that the Arkansas facility reaches projected production levels
after the planned modernization and expansion.

Colorado Lime Company acquired the Monarch Pass Quarry in November 1995 and
has not carried out any mining on the property. A review of the potential
limestone resources has been completed by independent geologists. However, we do
not consider the cost of a drilling program to be economically feasible at this
time and, consequently, it is not possible to identify and categorize reserves.
The Monarch Pass Quarry, which had been operated for many years until its
closure in the early nineties, contains a mixture of limestone types, including
high-quality calcium limestone and dolomite. We expect to utilize remaining
crushed stone inventories to supply our processing plant in nearby Salida.
Developed quarry benches are available and will be mined if the need arises.

We extract limestone by the open-pit method at the Arkansas and Texas
quarries. Monarch Pass is also an open-pit quarry, but is not being worked at
this time. Open-pit mining is generally less expensive than underground mining.
The principal disadvantage of the open-pit method is that operations are subject
to inclement weather.

After extraction through mining operations, limestone is crushed, screened,
and ground in the case of pulverized limestone, or further processed in kilns
and hydrators in the case of quicklime and hydrated lime, before shipment. We
produce lime and/or limestone products at three plants as described below.

Following the completion of the modernization and expansion of the Texas
plant at the end of 1998, the annual capacity is now 470,000 tons of quicklime
from three rotary kilns. The Texas project included the installation of a new
stone crushing and handling system, the addition of a preheater to one of the
existing kilns, additional storage, screening, and shipping capacity, and a new
support building housing a laboratory and administrative and shop facilities.
The plant has pulverized limestone equipment which has a capacity to produce
700,000 tons of pulverized limestone annually, depending on the product mix,
however, construction of a second pulverizing line is in progress which is
intended to provide operational flexibility in addition to an increase in
capacity to approximately 1,000,000 tons per annum. In addition to the Cleburne
plant, we own a dormant plant which is located near Blum, Texas on a tract of
land covering approximately 40 acres. The Blum plant was acquired in 1989, and
its kilns have not been operated since that time; however, the plant's storage
and shipment facilities are currently being utilized.

The Arkansas Lime production plant is situated on a tract of 290 acres
located approximately two miles from the Batesville Quarry to which it is
connected by a company-owned light-gauge railroad. Utilizing six vertical kilns,
this plant has an annual capacity of 85,000 tons of quicklime. The plant has two
grinding systems which, depending on the product mix, have the capacity to
produce 700,000 tons of pulverized limestone annually.

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Over the past decade, Arkansas Lime Company has lost various accounts due
to poor product quality and service from the vertical lime kilns which were
installed in the 1920's. We have commenced a modernization and expansion of the
Arkansas facility, to be completed in two phases, which is designed to expand
production and improve quality and service, enabling Arkansas Lime Company to
compete for new accounts and accounts with former customers lost due to the
quality and service issues. Phase I includes the redevelopment of the quarry
plant, rebuilding of the railroad to standard United States gauge, establishment
of an out-of-state terminal, and installation of a rotary kiln with preheater,
along with increased product storage and loading capacity. Completion of Phase I
will provide us with a modern quarry and lime manufacturing facilities with an
annual production capacity of up to approximately 200,000 tons of quicklime. A
distribution facility in Shreveport, Louisiana, connected to the Kansas City
Southern railroad, is in the process of being completed to provide lime storage
and distribution capacity to service markets in Louisiana and East Texas.
Arkansas Phase II will further expand lime production capacity at Arkansas to
approximately 400,000 tons of quicklime by the installation of a second rotary
kiln and preheater with additional storage capacity.

We maintain lime hydrating equipment and limestone drying and pulverizing
equipment at both the Texas and Arkansas plants. Storage facilities for lime and
pulverized limestone products at each plant consist primarily of cylindrical
tanks, which we considered to be adequate to protect our lime and limestone
products and to provide an available supply for our customers' needs at the
existing volume of shipments. Equipment is maintained at each plant to load
trucks, and at the Arkansas and Blum plants to load railroad cars.

The Colorado Lime Company operates a limestone drying, grinding and bagging
facility, with an annual capacity of 60,000 tons, on 99 acres of land in Salida,
Colorado. The property is leased from the Union Pacific Railroad for a term of 5
years, commencing June 1999, with renewal options for a further 10 years. A rail
loading spur is available, although we do not currently ship any products by
rail from this facility. This plant's facilities also include a small rotary
lime kiln which is permitted for operation but is presently not being operated.
A mobile stone crushing and screening plant is situated in the Monarch Pass
Quarry, producing agricultural grade limestone, with an annual capacity of up to
40,000 tons.

ABOUT THE LIME INDUSTRY

In recent years, the demand for lime has been relatively strong, and price
levels have gradually increased. However, the industry remains localized and
competitive, with quality, price and proximity to customers being the prime
factors affecting competition.

Our competitors are predominately private companies, and, following a
period of substantial consolidation in the lime and limestone industry, with the
four largest lime companies now account for approximately 70% of North American
lime capacity. In addition to the consolidations, and often in conjunction with
them, many lime producers have undergone modernization and expansion projects to
upgrade their processing equipment in an effort to improve operating efficiency.
Our modernization and expansion projects should allow us to continue to remain
competitive, protect our markets, and position ourselves for the future. In
addition, we will continue to evaluate external opportunities for expansion.

ABOUT THE RIGHTS OFFERING

BEFORE EXERCISING ANY SUBSCRIPTION RIGHTS, YOU SHOULD READ CAREFULLY THE
INFORMATION SET FORTH UNDER "RISK FACTORS" BEGINNING ON PAGE 6.

THE SUBSCRIPTION RIGHTS

We are distributing non-transferable subscription rights to shareholders
who owned shares of our common stock on [November ], 2000, at no cost to the
shareholders. We will give you [ ] subscription rights for each share of
common stock that you owned on [November ], 2000. You will not receive
fractional subscription rights during the rights offering, but instead we will
round your number of
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<PAGE> 16

subscription rights down to the nearest whole number. Each subscription right
will entitle you to purchase one share of common stock for $[ ]. If you
wish to exercise your subscription rights, you must do so before 5:00 p.m.,
Eastern Standard Time, on [ ], 2000. After that date, the subscription
rights will expire and will no longer be exercisable.

BASIC SUBSCRIPTION PRIVILEGE

Each subscription right will entitle you to receive one share of common
stock upon payment of $[ ] per share. You will receive certificates
representing the shares that you purchase pursuant to your basic subscription
privilege as soon as practicable after [ ], 2000, whether you exercise
your subscription rights immediately prior to that date or earlier.

OVER-SUBSCRIPTION PRIVILEGE

Subject to the allocation described below, each subscription right also
grants each shareholder an over-subscription privilege to purchase additional
shares of common stock that are not purchased by other shareholders pursuant to
their basic subscription privileges. You are entitled to exercise your over-
subscription privilege only if you exercise your basic subscription rights in
full. Inberdon, our majority shareholder, has expressed its willingness not to
subscribe for additional shares pursuant to this over-subscription privilege,
thus stepping back to allow other fully subscribing shareholders to purchase
additional shares if they wish.

If you wish to exercise your over-subscription privilege, you should
indicate the number of additional shares that you would like to purchase in the
space provided on your subscription certificate. When you send in your
subscription certificate, you must also send the full purchase price for the
number of additional shares that you have requested to purchase (in addition to
the payment due for shares purchased through your basic subscription privilege).
If the number of shares remaining after the exercise of all basic subscription
privileges is not sufficient to satisfy all requests for shares pursuant to
over-subscription privileges, you will be allocated additional shares pro rata
(subject to elimination of fractional shares), based on the number of shares you
purchased through the basic subscription privilege in proportion to the total
number of shares that you and other over-subscribing shareholders purchased
through the basic subscription privilege. However, if your pro rata allocation
exceeds the number of shares you requested on your subscription certificate,
then you will receive only the number of shares that you requested, and the
remaining shares from your pro rata allocation will be divided among other
shareholders exercising their over-subscription privileges. Subject to state
securities laws and regulations, we have the discretion to issue less than the
total number of shares that may be available for over-subscription requests in
order to comply with state securities laws.

As soon as practicable after [ ], 2000, Harris Trust Company of
New York, acting as our Subscription Agent, will determine the number of shares
of common stock that you may purchase pursuant to the over-subscription
privilege. You will receive certificates representing these shares as soon as
practicable after [ ]. Subject to state securities laws and
regulations, we have the discretion to delay allocation and distribution of any
and all shares to shareholders affected by such regulations, who elect to
participate in the rights offering, including shares that we issue with respect
to your basic or over-subscription privilege in order to comply with state
securities laws. If you request and pay for more shares than are allocated to
you, we will refund that overpayment, without interest. In connection with the
exercise of the over-subscription privilege, banks, brokers and other nominee
holders of subscription rights who act on behalf of beneficial owners will be
required to certify to the Subscription Agent and United States Lime & Minerals
as to the aggregate number of subscription rights that have been exercised, and
the number of shares of common stock that are being requested through the
over-subscription privilege, by each beneficial owner on whose behalf such
nominee holder is acting.

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PURCHASE COMMITMENTS

As of [November ], 2000, Inberdon owned approximately [51]% of the
outstanding shares of our common stock and, therefore, will receive rights to
subscribe for approximately [ ] shares of our common stock in the rights
offering. Inberdon has expressed its willingness to fully exercise its basic
subscription rights and, if the rights offering is undersubscribed, to purchase
the remainder of shares that are not fully subscribed for by other shareholders,
in the rights offering. Accordingly, we expect to receive $10,000,000 as a
result of the rights offering.

NO RECOMMENDATIONS

We are not making any recommendation as to whether or not you should
exercise your subscription rights. You should make your decision based on your
own assessment of your best interests.

EXPIRATION DATE

The rights will expire at 5:00 p.m., Eastern Standard Time, on
[ ], 2000, unless we decide to extend the rights offering. If this
commencement of the rights offering is delayed, the expiration date will be
similarly extended. If you do not exercise your basic subscription privilege and
over-subscription privilege prior to that time, YOUR SUBSCRIPTION RIGHTS WILL BE
NULL AND VOID. We will not be required to issue shares of common stock to you if
the Subscription Agent receives your subscription certificate or your payment
after that time, regardless of when you sent the subscription certificate and
payment, unless you send the documents in compliance with the guaranteed
delivery procedures described below.

CANCELLATION RIGHT

Our Board of Directors, excluding the director affiliated with Inberdon,
may cancel the rights offering in its sole discretion at any time prior to or on
[ ], 2000 for any reason (including, without limitation, a change in
the market price of the common stock). If we cancel the rights offering, any
funds you paid will be promptly refunded, without interest.

DETERMINATION OF SUBSCRIPTION PRICE

Our Board of Directors, excluding the director affiliated with Inberdon,
set all of the terms and conditions of the rights offering, including the
subscription price. Our Board of Directors, excluding the director affiliated
with Inberdon, decided to set the per share subscription price at $[ ] after
considering a variety of factors including the current and historical market
prices of the common stock, our book value per share, our business prospects,
general conditions in the securities market, our need for capital, alternatives
available to us for raising capital, the amount of proceeds desired, pricing of
similar transactions, the liquidity of our common stock, the level of risk to
our shareholders, and the need to offer shares at a price that would be
acceptable to Inberdon and attractive to our other shareholders relative to the
current trading price of our common stock. The $[ ] per share subscription
price should not be considered an indication of the actual value of United
States Lime & Minerals or our common stock. We cannot assure you that the market
price of the common stock will not decline during the rights offering. We also
cannot assure you that you will be able to sell shares of common stock purchased
during the rights offering at a price equal to or greater than $[ ] per
share. See "Determination of Offering Price."

NON-TRANSFERABILITY OF SUBSCRIPTION RIGHTS

Only you may exercise the basic subscription privilege and the
over-subscription privilege. You may not sell, give away or otherwise transfer
the basic subscription privilege or the over-subscription privilege.

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<PAGE> 18

EXERCISE OF SUBSCRIPTION RIGHTS

You may exercise your subscription rights by delivering to the Subscription
Agent on or prior to [ ]:

- A properly completed and duly executed subscription certificate;

- Any required signature guarantees; and

- Payment in full of $[ ] per share of common stock to be purchased
through the basic subscription privilege and the over-subscription
privilege.

You should deliver your subscription certificate and payment to the
Subscription Agent at the address shown under the heading "Subscription Agent."
We will not pay you interest on funds delivered to the Subscription Agent
pursuant to the exercise of rights.

METHOD OF PAYMENT

Payment for the shares must be made by check or bank draft (cashier's
check) drawn upon a U.S. bank or a postal, telegraphic or express money order
payable to "Harris Trust Company of New York, AS SUBSCRIPTION AGENT" or by wire
transfer of immediately available funds to the account maintained by the
Subscription Agent at 88 Pine Street, 19th Floor, New York, New York 10005. Any
wire transfer of funds should clearly indicate the identity of the subscriber
who is paying the subscription price by the wire transfer. If you are purchasing
an aggregate number of shares of common stock totaling $500,000 or more, we may
agree to an alternative payment method, which may include, for example,
cancellation of debt. If you use an alternative payment method, the Subscription
Agent must receive the full amount of your payment in currently available funds
within one over-the-counter ("OTC") trading day prior to [ ], 2000. Payment
will be deemed to have been received by the Subscription Agent only upon:

(A) clearance of any uncertified check;

(B) receipt by the Subscription Agent of any certified check or bank
draft drawn upon U.S. bank, any postal, telegraphic or express money order
or any funds transferred by wire transfers;

(D) receipt of funds by the Subscription Agent through an alternative
payment method.

Please note that funds paid by uncertified personal check may take at least
five business days to clear. Accordingly, if you wish to pay by means of an
uncertified personal check, we urge you to make payment sufficiently in advance
of [ ], 2000 to ensure that the payment is received and clears before
that date. We also urge you to consider payment by means of a certified or
cashier's check or money order.

GUARANTEED DELIVERY PROCEDURES

If you want to exercise your subscription rights, but time will not permit
your subscription certificate to reach the Subscription Agent on or prior to
[ ], 2000 you may exercise your subscription rights if you satisfy the
following guaranteed delivery procedures:

(1) You send, and the Subscription Agent receives, payment in full for
each share of common stock being subscribed for through the basic
subscription privilege and the over-subscription privilege, on or prior to
[ ], 2000;

(2) You send, and the Subscription Agent receives, on or prior to
[ ], 2000, a notice of guaranteed delivery, substantially in the
form provided with the attached instructions, from a member firm of a
registered national securities exchange or a member of the National
Association of Securities Dealers, Inc., or a commercial bank or trust
company having an office or correspondent in the United States. The notice
of guaranteed delivery must state your name, the number of
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<PAGE> 19

subscription rights that you hold, the number of shares of common stock
that you wish to purchase pursuant to the basic subscription privilege and
the number of shares, if any, you wish to purchase pursuant to the
over-subscription privilege. The notice of guaranteed delivery must
guarantee the delivery of your subscription certificate to the Subscription
Agent within three OTC trading days following the date of the notice of
guaranteed delivery; and

(3) You send, and the Subscription Agent receives, your properly
completed and duly executed subscription certificate, including any
required signature guarantees, within three OTC trading days following the
date of your notice of guaranteed delivery. The notice of guaranteed
delivery may be delivered to the Subscription Agent in the same manner as
your subscription certificate at the addresses set forth under the heading
"Subscription Agent," or may be transmitted to the Subscription Agent by
facsimile transmission, to facsimile number (212) 701-7864. You can obtain
additional copies of the form of notice of guaranteed delivery by
requesting them from the Subscription Agent at the address set forth under
the heading "Subscription Agent."

SIGNATURE GUARANTEES

Signatures on the subscription certificate must be guaranteed by an
Eligible Guarantor Institution, as defined in Rule 17Ad-15 of the Securities
Exchange Act of 1934, as amended, subject to the standards and procedures
adopted by the Subscription Agent. Eligible Guarantor Institutions include
banks, brokers, dealers, credit unions, national securities exchanges and
savings associations. Signatures on the subscription certificate do not need to
be guaranteed if either the subscription certificate provides that the shares of
common stock to be purchased are to be delivered directly to the record owner of
such subscription rights, or the subscription certificate is submitted for the
account of a member firm of a registered national securities exchange or a
member of the National Association of Securities Dealers, Inc., or a commercial
bank or trust company having an office or correspondent in the United States.

SHARES HELD FOR OTHERS

If you are a broker, a trustee or a depository for securities, or you
otherwise hold shares of common stock for the account of a beneficial owner of
common stock, you should notify the beneficial owner of such shares as soon as
possible to obtain instructions with respect to their subscription rights. If
you are a beneficial owner of common stock held by a holder of record, such as a
broker, trustee or a depository for securities, you should contact the holder
and ask him or her to effect transactions in accordance with your instructions.
Notwithstanding the above, if you are a current or former employee of ours who
beneficially owns shares of our common stock which are held in our 401(k) plan
(formerly the ESOP), we will treat those shares as part of your record ownership
for purposes of calculating your subscription rights.

AMBIGUITIES IN EXERCISE OF SUBSCRIPTION RIGHTS

If you do not specify the number of subscription rights being exercised on
your subscription certificate, or if your payment is not sufficient to pay the
total purchase price for all of the shares that you indicated you wished to
purchase, you will be deemed to have exercised the maximum number of
subscription rights that could be exercised for the amount of the payment that
the Subscription Agent receives from you. If your payment exceeds the total
purchase price for all of the subscription rights shown on your subscription
certificate, your payment will be applied, until depleted, to subscribe for
shares of common stock in the following order:

(1) to subscribe for the number of shares, if any, that you indicated
on the subscription certificate that you wished to purchase through your
basic subscription privilege;

(2) to subscribe for shares of common stock until your basic
subscription privilege has been fully exercised;

16
<PAGE> 20

(3) to subscribe for additional shares of common stock pursuant to the
over-subscription privilege (subject to any applicable proration). Any
excess payment remaining after the foregoing allocation will be returned to
you as soon as practicable by mail, without interest or deduction.

REGULATORY LIMITATION

We will not be required to issue you shares of common stock pursuant to the
rights offering if, in our opinion, you would be required to obtain prior
clearance or approval from any state or federal regulatory authorities to own or
control such shares if, at the time the subscription rights expire, you have not
obtained such clearance or approval.

OUR DECISION BINDING

All questions concerning the timeliness, validity, form and eligibility of
any exercise of subscription rights will be determined by us, and our
determinations will be final and binding. In our sole discretion, we may waive
any defect or irregularity, or permit a defect or irregularity to be corrected
within such time as we may determine, or reject the purported exercise of any
subscription right by reason of any defect or irregularity in such exercise.
Subscriptions will not be deemed to have been received or accepted until all
irregularities have been waived or cured within such time as we determine in our
sole discretion. Neither United States Lime & Minerals nor the Subscription
Agent will be under any duty to notify you of any defect or irregularity in
connection with the submission of a subscription certificate or incur any
liability for failure to give such notification.

NO REVOCATION

After you have exercised your basic subscription privilege or
over-subscription privilege, YOU MAY NOT REVOKE THAT EXERCISE. You should not
exercise your subscription rights unless you are certain that you wish to
purchase additional shares of common stock at the subscription price.

SHARES OF COMMON STOCK OUTSTANDING AFTER THE RIGHTS OFFERING

Assuming we issue all of the shares of common stock offered in the rights
offering, approximately [ ] shares of common stock will be issued and
outstanding. This would represent a [ ]% increase in the number of
outstanding shares of common stock. IF YOU DO NOT EXERCISE YOUR BASIC
SUBSCRIPTION PRIVILEGE, THE PERCENTAGE OF COMMON STOCK THAT YOU HOLD WILL
DECREASE.

17
<PAGE> 21

CAPITALIZATION TABLE

The following table sets forth our cash and cash equivalents, current
installments of long-term debt and revolving credit facility, long-term debt,
excluding current installments and revolving credit facility, and stockholders'
equity as of September 30, 2000, and as adjusted to reflect the $10,000,000
proceeds from the Rights Offering and the New Loan, as if the Rights Offering
had closed as of September 30, 2000 and we had drawn down the additional
$7,000,000 under the New Loan as of that date. You should read this table in
conjunction with our consolidated financial statements and the notes thereto
which are incorporated by reference into this prospectus.

<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 2000
(UNAUDITED)
-------------------------
ACTUAL PRO FORMA
--------- -----------
(IN THOUSANDS)
<S> <C> <C>
Cash and cash equivalents................................... 2,186 19,186
Current installments of long-term debt and revolving credit
facility.................................................. 3,333 3,333
Long-term debt, excluding current installments and revolving
credit facility........................................... 45,000 52,000
Stockholders' equity:
Common stock.............................................. 529 [ ]
Additional paid-in capital................................ 14,819 [ ]
Retained earnings......................................... 27,780 27,780
Less treasury stock at cost:
1,312,401 shares of common stock.......................... (13,927) (13,927)
Total stockholders' equity.................................. 29,201 39,201
======= =======
Debt Ratio (debt : debt plus total equity).................. 62.3% 58.5%
</TABLE>

FEES AND EXPENSES

We will pay all fees charged by the Subscription Agent. You are responsible
for paying any other commissions, fees, taxes or other expenses incurred in
connection with the exercise of the subscription rights. Neither United States
Lime & Minerals nor the Subscription Agent will pay such expenses.

SUBSCRIPTION AGENT

We have appointed Harris Trust Company of New York as Subscription Agent
for the rights offering. The Subscription Agent's address for packages sent by
mail or overnight delivery is:

Harris Trust Company of New York
88 Pine Street, 19th Floor
New York, New York 10005.

The Subscription Agent's telephone number is (212) 701-7600 and its
facsimile number is (212) 701-7864. You should deliver your subscription
certificate, payment of the subscription price and notice of guaranteed delivery
(if any) to the Subscription Agent. We will pay the fees and certain expenses of
the Subscription Agent, which we estimate will total $25,000. Under certain
circumstances, we may indemnify the Subscription Agent from certain liabilities
that may arise in connection with the rights offering.

IMPORTANT

PLEASE CAREFULLY READ THE INSTRUCTIONS ACCOMPANYING THE SUBSCRIPTION
CERTIFICATE AND FOLLOW THOSE INSTRUCTIONS IN DETAIL. DO NOT SEND SUBSCRIPTION
CERTIFICATES DIRECTLY TO US. YOU ARE RESPONSIBLE FOR CHOOSING THE PAYMENT AND
DELIVERY METHOD FOR YOUR SUBSCRIPTION CERTIFICATE, AND YOU BEAR THE RISKS
ASSOCIATED WITH SUCH DELIVERY. IF YOU CHOOSE TO DELIVER YOUR SUBSCRIPTION
CERTIFICATE AND PAYMENT BY MAIL, WE RECOMMEND THAT YOU USE REGISTERED MAIL,
PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED. WE ALSO RECOMMEND THAT YOU
ALLOW A SUFFICIENT NUMBER OF DAYS TO ENSURE DELIVERY TO THE SUBSCRIPTION AGENT
AND CLEARANCE OF PAYMENT PRIOR TO [ ], 2000. BECAUSE UNCERTIFIED
PERSONAL CHECKS MAY TAKE AT LEAST

18
<PAGE> 22

FIVE BUSINESS DAYS TO CLEAR, WE STRONGLY URGE YOU TO PAY, OR ARRANGE FOR
PAYMENT, BY MEANS OF CERTIFIED OR CASHIER'S CHECK OR MONEY ORDER.

IF YOU HAVE QUESTIONS

If you have questions or need assistance concerning the procedure for
exercising subscription rights, or if you would like additional copies of this
prospectus, the Instructions, or the Notice of Guaranteed Delivery, you should
contact us at:

United States Lime & Minerals, Inc.
13800 Montfort Drive, Suite 330
Dallas, Texas 75240
Attention: Larry T. Ohms, Vice President of Finance,
Corporate Controller and Secretary
Telephone: (972) 991-8400

DESCRIPTION OF COMMON STOCK

As a holder of common stock, you are entitled to one vote for each share
held of record on all matters submitted to a vote of our shareholders. You are
entitled to receive dividends, if any, declared by our Board of Directors. If we
liquidate United States Lime & Minerals you will be entitled to share ratably
with the other shareholders in the distribution of all assets that we have left
after we pay all of our liabilities and make any necessary distributions to
holders of our preferred stock. You have no preemptive rights to subscribe for
additional shares of common stock and no right to convert your common stock into
any other securities. In addition, you do not have the benefit of a sinking fund
for your shares of common stock. Your common stock is not redeemable by United
States Lime & Minerals.

USE OF PROCEEDS

We expect to receive gross proceeds from the rights offering of
$10,000,000. We will apply the net proceeds from the offering, estimated to be
approximately $[ ], to: (i) provide $5,000,000 of new equity capital which,
together with the New Loan of $7,000,000, will be used for the construction of
Arkansas Phase II; and (ii) provide us, along with the Revolver, with ongoing
working capital. Any excess will be used for general corporate purposes.

Even if we receive proceeds of $10,000,000, if the cost of Arkansas Phase
II increases, or if we fail to attain sufficient levels of operating income, we
may require additional capital. We cannot assure you that such capital will be
available on satisfactory terms.

DETERMINATION OF OFFERING PRICE

Our Board of Directors, excluding the director affiliated with Inberdon,
set all of the terms and conditions of the rights offering, including the
subscription price. Our Board of Directors, excluding the director affiliated
with Inberdon, decided to charge a $[ ] per share subscription price after
considering a variety of factors, including the current and historical market
prices of the common stock, our book value per share, our business prospects,
general conditions in the securities market, our need for capital, alternatives
available to us for raising capital, the amount of proceeds desired, pricing of
similar transactions, the liquidity of our common stock, the level of risk to
our shareholders, and the need to offer shares at a price that would be
acceptable to Inberdon and attractive to our other shareholders relative to the
current trading price of our common stock. The $[ ] per share price should
not be considered an indication of the actual value of United States Lime &
Minerals or our common stock. We cannot assure you that the market price of the
common stock will not decline during the rights offering. We also cannot assure
you that you will be able to sell shares of common stock purchased during the
rights offering at a price equal to or greater than $[ ] per share.
19
<PAGE> 23

PLAN OF DISTRIBUTION

On or about [November ], 2000, we will distribute the subscription rights
and copies of this prospectus to individuals who owned shares of common stock on
[November ], 2000. If you wish to exercise your subscription rights and
purchase shares of common stock, you should complete the subscription
certificate and return it, with payment for the shares, to the Subscription
Agent, Harris Trust Company of New York, at the address on page 18. See "The
Rights Offering -- Exercise of Subscription Rights." If you have any questions,
you should contact our Vice President of Finance, Company Secretary and
Corporate Controller, Larry T. Ohms, at the telephone number and address on page
19.

FEDERAL INCOME TAX CONSIDERATIONS

The following summarizes the material federal income tax considerations of
the rights offering to you and United States Lime & Minerals. This summary is
based on current law, which is subject to change at any time, possibly with
retroactive effect. This summary is not a complete discussion of all federal
income tax consequences of the rights offering, and, in particular, may not
address federal income tax consequences applicable to shareholders subject to
special treatment under federal income tax law. In addition, this summary does
not address the tax consequences of the rights offering under applicable state,
local or foreign tax laws. This discussion assumes that your shares of common
stock and the subscription rights and shares issued to you during the rights
offering constitute capital assets.

Receipt and exercise of the subscription rights distributed pursuant to the
rights offering is intended to be nontaxable to shareholders, and the following
summary assumes you will qualify for such nontaxable treatment. If, however, the
rights offering does not qualify as nontaxable, you would be treated as
receiving a taxable distribution equal to the fair market value of the
subscription rights on their distribution date. The distribution would be taxed
as a dividend to the extent made out of United States Lime & Minerals' current
or accumulated earnings and profits; any excess would be treated first as a
return of your basis (investment) in your United States Lime & Minerals stock
and then as a capital gain. Expiration of the subscription rights would result
in a capital loss.

This discussion is included for your general information only. You should
consult your tax advisor to determine the tax consequences to you of the rights
offering in light of your particular circumstances, including any state, local
and foreign tax consequences.

TAXATION OF SHAREHOLDERS

Receipt of a Subscription Right. You will not recognize any gain or other
income upon receipt of a subscription right.

Tax Basis and Holding Period of Subscription Rights. Your tax basis in
each subscription right will effectively depend on whether you exercise the
subscription right or allow the subscription right to expire.

If you exercise a subscription right, your tax basis in the subscription
right will be determined by allocating the tax basis of your common stock on
which the subscription right is distributed between the common stock and the
subscription right, in proportion to their relative fair market values on the
date of distribution of the subscription right. However, if the fair market
value of your subscription rights is less than 15 percent of the fair market
value of your existing shares of common stock, then the tax basis of each
subscription right will be deemed to be zero, unless you elect, by attaching an
election statement to your federal income tax return for 2000, to allocate tax
basis to your subscription rights.

If you allow a subscription right to expire, it will be treated as having
no tax basis. Your holding period for a subscription right will include your
holding period for the shares of common stock upon which the subscription right
is issued.

Expiration of Subscription Rights. You will not recognize any loss upon
the expiration of a subscription right.

20
<PAGE> 24

Exercise of Subscription Rights. You generally will not recognize a gain
or loss on the exercise of a subscription right. The tax basis of any share of
common stock that you purchase through the rights offering will be equal to the
sum of your tax basis (if any) in the subscription right exercised and the price
paid for the share. The holding period of the shares of common stock purchased
through the rights offering will begin on the date that you exercise your
subscription rights.

TAXATION OF UNITED STATES LIME & MINERALS

We will not recognize any gain, other income or loss upon the issuance of
the subscription rights, the lapse of the subscription rights, or the receipt of
payment for shares of common stock upon exercise of the subscription rights.

STATE AND FOREIGN SECURITIES LAWS

The rights offering is not being made in any state or other jurisdiction in
which it is unlawful to do so, nor are we selling or accepting any offers to
purchase any shares of common stock to you if you are a resident of any such
state or other jurisdiction. We may delay the commencement of the rights
offering in certain states or other jurisdictions in order to comply with the
securities law requirements of such states or other jurisdictions. It is not
anticipated that there will be any changes in the terms of the rights offering.
In our sole discretion, we may decline to make modifications to the terms of the
rights offering requested by certain states or other jurisdictions, in which
case shareholders who live in those states or jurisdictions will not be eligible
to participate in the rights offering.

LEGAL MATTERS

The validity of the shares of common stock offered by this prospectus will
be passed upon for us by Morgan, Lewis & Bockius LLP, Washington, D.C.

EXPERTS

Our consolidated financial statements incorporated by reference from our
Annual Report (Form 10-K) for the year ended December 31, 1999, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
thereon included therein and incorporated by reference into this prospectus.
Such consolidated financial statements are incorporated by reference into this
prospectus in reliance upon such report given on the authority of such firm as
experts in accounting and auditing.

IF YOU WOULD LIKE MORE INFORMATION

We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy this information at the SEC's
public reference rooms, which are located at:

450 Fifth Street, NW
Washington, DC 20549

7 World Trade Center, Suite 1300
New York, NY 10048

500 West Madison Street, Suite 1400
Chicago, IL 60661

Please call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms. This information is also available online through the SEC's
Electronic Data Gathering, Analysis, and Retrieval System (EDGAR), located on
the SEC's web site (http://www.sec.gov).

21
<PAGE> 25

Also, we will provide (free of charge) any of our documents filed with the
SEC, as you reasonably may request. To get your free copies, please call or
write to:

Larry T. Ohms
Vice President of Finance,
Secretary and Corporate Controller
United States Lime & Mineral, Inc.
13800 Montfort Drive, Suite 330
Dallas, Texas 75240
(972) 991-8400

The SEC allows us to "incorporate by reference" the information we have
filed with them, which means that we can disclose important information to you
by referring you to other documents. The documents that are incorporated by
reference are legally considered to be a part of this prospectus. The documents
incorporated by reference are:

(1) our Annual Report on Form 10-K for the year ended December 31,
1999;

(2) our Quarterly Report on Form 10-Q for the period ended September
30, 2000, our Quarterly Report on Form 10-Q for the period ended June 30,
2000 and our Quarterly Report on Form 10-Q for the period ended March 31,
2000;

(3) our Definitive Proxy Statement on Schedule 14A filed March 20,
2000; and

(4) any filings with the SEC pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act of 1934 between the date of this prospectus and
the expiration of the rights offering.

As you read the above documents, you may find some inconsistencies in
information from one document to another. If you find inconsistencies between
the documents, or between a document and this prospectus, you should rely on the
statements made in the most recent document.

You should rely only on the information in this prospectus or incorporated
by reference. We have not authorized anyone to provide you with any different
information.

This prospectus is not an offer to sell nor is it seeking an offer to buy
these securities in any state where the offer or sale is not permitted. This
prospectus is not an offer to sell nor is it seeking an offer to buy securities
other than the shares of common stock to be issued pursuant to the rights
offering. The information contained in this prospectus is correct only as of the
date of this prospectus, regardless of the time of the delivery of this
prospectus or any sale of these securities.

No action is being taken in any jurisdiction outside the United States to
permit a public offering of the common stock or possession or distribution of
this prospectus in any such jurisdiction. Persons who come into possession of
this prospectus in jurisdictions outside the United States are required to
inform themselves about and to observe any restrictions as to this offering and
the distribution of this prospectus applicable in the jurisdiction.

22
<PAGE> 26

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The expenses in connection with the issuance and distribution of the
Securities, other than underwriting discounts and commissions, being registered
are set forth in the following table (all amounts other than the Registration
Fee and the Nasdaq National Market Listing Fee are estimated):

<TABLE>
<S> <C>
SEC Registration Fee........................................ $ 2,640
Nasdaq National Market Listing Fee..........................
Subscription Agent Fees and Expenses........................ $ 25,000
Legal Fees and Expenses..................................... $200,000
Blue Sky Fees and Expenses..................................
Accounting Fees and Expenses................................
Printing and Engraving Expenses.............................
Miscellaneous Costs.........................................
Total.............................................
</TABLE>

All expenses in connection with the issuance and distribution of the
securities being offered shall be borne by us.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 2.02-1 of the Texas Business Corporation Act, as amended,
authorizes us to indemnify our officers and directors and certain other persons
in certain instances.

In addition, Section 2.02-1 and our Bylaws require that we indemnify any
director or officer against reasonable expenses he incurs in connection with a
wholly successful defense of a proceeding in which he is a named defendant or
respondent because he is or was a director or officer. This indemnification will
only occur with the determination that the person (i) conducted himself in good
faith, (ii) reasonably believed, in the case of conduct in his official capacity
as our director or officer, that his conduct was in our best interests and, in
all other cases, that his conduct was at least not opposed to our best
interests, and (iii), in the case of any criminal proceeding, had no reasonable
cause to believe his conduct was unlawful. However, if the director or officer
is found liable to us or is found liable on the basis that personal benefit was
improperly received, the indemnification shall be limited to reasonable expenses
actually incurred in connection with the proceeding. Indemnification shall not
be made in respect of any proceeding in which the person shall have been found
liable for willful or intentional misconduct in the performance of his duty to
us.

The Bylaws generally require determinations that the person to be
indemnified has satisfied the prescribed conduct and belief standards, as
determined by directors who are not themselves then named defendants or
respondents in the proceeding, by a special legal counsel selected by the Board
of Directors or a committee thereof, or by shareholders in a vote that excludes
the shares held by directors and officers who are named defendants or
respondents in the proceeding.

The Bylaws further require us to pay or reimburse expenses incurred by a
director or officer in connection with his appearance as a witness or other
participation in a proceeding at a time when he is not a named defendant or
respondent in the proceeding. We must also advance reasonable expenses to a
director or officer upon receipt of a good faith affirmation by him that he has
met the standard of conduct necessary for indemnification and a written
undertaking to repay such advances if it is ultimately determined that he has
not met those requirements.

The Bylaws permit us to indemnify and advance expenses to an officer,
employee, or agent to such further extent as may be consistent with law,
including persons serving another entity in various capacities

II-1
<PAGE> 27

at our request. The Bylaws also authorize us to purchase and maintain insurance
or make other arrangements on behalf of directors, officers, employees, and
agents against or in respect of liabilities.

Any indemnification of or advance of expenses to a director under the
Bylaws or any statute must be reported in writing to shareholders not later than
the notice of the next shareholders' meeting or the next submission to
shareholders of a consent to action without a meeting and, in any event, within
the 12-month period immediately following the indemnification or advance.

ITEM 16. EXHIBITS

<TABLE>
<C> <S>
5.1 -- Form of Opinion of Morgan, Lewis & Bockius LLP
23.1 -- Consent of Morgan, Lewis & Bockius LLP (included in
Exhibit 5.1)
23.2 -- Consent of Ernst & Young LLP
24.1 -- Power of Attorney (included on signature page)
99.1 -- Form of Subscription Certificate
99.2 -- Form of Instructions for Use of United States Lime &
Minerals, Inc. Subscription Certificates
99.3 -- Form of Notice of Guaranteed Delivery
99.4 -- Form of Letter to Shareholders
99.5 -- Form of Letter to Brokers
99.6 -- Subscription Agent Agreement (to be filed by amendment)
</TABLE>

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and

(iii) To include any additional or changed material information
with respect to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement;

Provided, however, paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
registrant pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934, as amended, that are incorporated by reference in
the registration statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities

II-2
<PAGE> 28

offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report
pursuant to section 13(a) or section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

II-3
<PAGE> 29

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant, United States Lime & Minerals, Inc., certifies that it has
reasonable grounds to believe that it meets all of the requirements for filing
on Form S-3 and has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Dallas,
State of Texas, on this 30th day of October, 2000.

UNITED STATES LIME & MINERALS, INC.

By: /s/ HERBERT G.A. WILSON
----------------------------------
Herbert G.A. Wilson
President and Chief Executive
Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby appoints Herbert G.A.
Wilson and/or Larry T. Ohms, his true and lawful attorney-in-fact with the
authority to execute in the name of each such person, and to file with the
Securities and Exchange Commission, together with any exhibits thereto and other
documents therewith, any and all amendments (including without limitation
post-effective amendments) to this registration statement necessary or advisable
to enable the Registrant to comply with the Securities Act of 1933, as amended,
and any rules, regulations and requirements of the Securities and Exchange
Commission in respect thereof, which amendments may make such other changes in
the registration statement as the aforesaid attorney-in-fact executing the same
deems appropriate.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

/s/ HERBERT G.A. WILSON President, Chief Executive October 30, 2000
----------------------------------------------------- Officer and Director
Herbert G.A. Wilson (Principal Executive
Officer)

/s/ LARRY T. OHMS Vice President of Finance, October 30, 2000
----------------------------------------------------- Company Secretary and
Larry T. Ohms Corporate Controller
(Principal Financial and
Accounting Officer)

/s/ EDWARD A. ODISHAW Director and Chairman of the October 30, 2000
----------------------------------------------------- Board
Edward A. Odishaw

/s/ ANTOINE M. DOUMET Director and Vice Chairman October 30, 2000
----------------------------------------------------- of the Board
Antoine M. Doumet

/s/ JOHN J. BROWN Director October 30, 2000
-----------------------------------------------------
John J. Brown
</TABLE>

II-4
<PAGE> 30

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

/s/ WALLACE G. IRMSCHER Director October 30, 2000
-----------------------------------------------------
Wallace G. Irmscher

/s/ RICHARD W. CARDIN Director October 30, 2000
-----------------------------------------------------
Richard W. Cardin

/s/ TIMOTHY W. BYRNE Director October 30, 2000
-----------------------------------------------------
Timothy W. Byrne
</TABLE>

II-5
<PAGE> 31

INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
------- -----------
<C> <S>
5.1 -- Form of Opinion of Morgan, Lewis & Bockius LLP
23.1 -- Consent of Morgan, Lewis & Bockius LLP (included in
Exhibit 5.1)
23.2 -- Consent of Ernst & Young LLP
24.1 -- Power of Attorney (included on signature page)
99.1 -- Form of Subscription Certificate
99.2 -- Form of Instructions for Use of United States Lime &
Minerals, Inc. Subscription Certificates
99.3 -- Form of Notice of Guaranteed Delivery
99.4 -- Form of Letter to Shareholders
99.5 -- Form of Letter to Brokers
99.6 -- Subscription Agent Agreement (to be filed by amendment)
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