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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE COMMISSION ACT OF 1934
For the quarterly period ended November 30, 1997
Commission File Number: 1-5970
SILVER BUTTE MINING COMPANY
(Exact name of registrant as specified in its charter)
IDAHO 84-0263301
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification Number)
2501 E. SHERMAN AVENUE, #215, COEUR D'ALENE, ID 83814
(Address of Principal Executive Offices) (Zip Code)
(208) 664-0880
Registrant's telephone number, including area code
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes ( ) No (X)
The number of shares of Common Stock , $.05 par value, outstanding as of
November 30, 1997, was 7,828,748.
*****************************************************************************
<PAGE>
SILVER BUTTE MINING COMPANY
FORM 10-QSB ANNUAL REPORT
November 30, 1997
INDEX
Part I FINANCIAL INFORMATION
Item 1. Condensed Financial Statements
Balance Sheets, November 30, and August 31, 1997 3
Income Statements for the Three Months Ended November 30, 1997 and 1996 4
Cash Flow Statements for the Three Months Ended November 30, 1997 and 1996 5
Notes to Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7-8
Part II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K 8
Signature Page 8
2
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SILVER BUTTE MINING COMPANY
CONDENSED BALANCE SHEETS
November 30 and August 31, 1997
<TABLE>
November 30, August 31,
1997 1997
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 6,260 $ 84,297
Certificate of deposit for State lease 5,000 5,000
Marketable Securities 75,031 -
Accounts receivable 1,871 1,092
_________ _________
TOTAL CURRENT ASSETS 88,162 90,389
_________ _________
PROPERTY, PLANT & EQUIPMENT
Properties 3,000 3,000
Equipment and machinery 19,704 19,704
Accumulated depreciation (19,704) (19,704)
_________ __________
3,000 3,000
_________ _________
TOTAL ASSETS $ 91,162 $ 93,389
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 9,351 $ 7,910
_________ __________
TOTAL CURRENT LIABILITIES 9,351 7,910
_________ __________
SHAREHOLDERS' EQUITY
Capital stock, $.05 par value,
authorized 10,000,000 shares, issued and
outstanding, 7,828,748 391,437 391,437
Additional paid-in capital 392,953 392,953
Accumulated deficit (702,579) (698,911)
_________ _________
TOTAL SHAREHOLDERS' EQUITY 81,811 85,479
_________ _________
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 91,162 $ 93,389
========= =========
</TABLE>
The accompanying notes are an integral part of these
condensed financial statements
3
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<TABLE>
SILVER BUTTE MINING COMPANY
CONDENSED INCOME STATEMENTS
For the Three Months Ended November 30, 1997, and 1996
Three Months Ended
November 30, November 30,
1997 1996
___________ ___________
<S> <C> <C>
REVENUES
Interest income $ 850 $ 1,223
Rock sales 780 1,077
Miscellaneous other income 31 -
___________ ___________
Total revenue 1,661 2,300
___________ ___________
EXPENSES
Wages and other compensation 2,835 1,285
Professional services 2,084 1,742
Rent 190 -
Office expense 122 188
Miscellaneous 98 111
___________ ___________
Total expenses 5,329 3,326
___________ ___________
LOSS BEFORE INCOME TAXES (3,668) (1,026)
INCOME TAXES - -
___________ ___________
NET LOSS $ (3,668) $ (1,026)
=========== ===========
Loss per Share of Common
Stock Outstanding $ ( 0.0005) $ (0.0001)
=========== ===========
Weighted Average Number of Common
Shares Outstanding 7,828,748 7,828,748
=========== ===========
</TABLE>
The accompanying notes are an integral part of these
condensed financial statements
4
<PAGE>
<TABLE>
SILVER BUTTE MINING COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
For the Three Months Ended November 30, 1997, and 1996
Three Months Ended
November 30, November 30,
1997 1996
___________ ___________
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $ (3,668) $ (1,026)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Increase in payables 1,441 454
Decrease in prepaid expenses - 2,240
Increase in receivables (779) (2,078)
___________ ___________
Net cash used in
operating activities (3,006) 410
___________ ___________
CASH FLOWS FROM INVESTING ACTIVITIES
Increase in marketable securities (75,031) -
___________ ___________
Net cash used in
investing activities (75,031) -
___________ ___________
NET DECREASE IN CASH AND
CASH EQUIVALENTS (78,037) (410)
Cash and Cash Equivalents at Beginning of Year 84,297 6,090
___________ ___________
Cash and Cash Equivalents at End of Year $ 6,260 $ 5,680
=========== ===========
Interest Expense paid $ - $ -
========== ===========
Income taxes paid $ - $ -
========== ===========
</TABLE>
The accompanying notes are an integral part of these
condensed financial statements
5
<PAGE>
SILVER BUTTE MINING COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
NOTE 1. PRESENTATION OF INTERIM INFORMATION
The accompanying unaudited condensed financial statements have been
prepared by Silver Butte Mining Company's management. In management's
opinion, these condensed financial statements include all normal adjustments
considered necessary to present fairly the financial position as of November
30, 1997 and 1996, and cash flows for the three months ended November 30, 1997
and 1996. Interim results are not necessarily indicative of results for a full
year.
The condensed financial statements and notes are presented as permitted by
Form 10-QSB, and do not contain certain information that is included in the
Company's annual financial statements.
NOTE 2. MARKETABLE SECURITIES
The Company has invested in certain money market fund equity securities
which it considers as available for sale according to Statement of Financial
Accounting Standards (SFAS) 115. Unrealized holdings gains and losses on such
securities are not expected, but will be excluded from earnings and reported as
a separate component of the shareholders' equity, if gains or losses occur.
The cost of these marketable securities, when sold, will be determined by the
specific identification method.
The fair value of these securities, in accordance with SFAS 107, is
considered to be the same as their cost, based on quoted market prices.
NOTE 3. COMMITMENTS AND CONTINGENCIES
The Company sold a seven acre parcel of land in the fiscal year ended
August 31, 1996 that contains mine waste rock and mill tailings. The Company
believes there is a remote possibility that this property may require some
cleanup, and an even more remote possibility that the Company may be required
to participate in the cost of such cleanup, which the Company estimates would
be less than $10,000.
6
<PAGE>
SILVER BUTTE MINING COMPANY
Form 10-QSB QUARTERLY REPORT
November 30, 1997
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company was a mining company engaged in exploration activities from
its inception in 1965 through 1994. In 1994, the Company abandoned all
exploration activities, and is now seeking other business opportunities in
mining or other industries. The Company continues to hold and maintain the
properties on which it performed its exploration efforts. The Company's fiscal
year ends on August 21.
OVERVIEW
The Company's management determined in 1994 that it did not have the
financial resources to continue to explore for a commercial ore deposit after
many years of unsuccessful efforts. The Company has performed some reclamation
work on its mining properties since 1994, and is soliciting buyers for its
remaining real estate and mining equipment. The Company's management believes
that its status as a public company may be of some value, and management will
entertain proposals from other companies which may be interested in combining
with a public company.
RESULTS OF OPERATIONS
REVENUES. The Company's interest income decreased by $373 (about 30%) for
the three month period ended November 30, 1997, compared to the same period
ended November 30, 1996. This was the result of the Company's maintaining its
funds in a lower yielding bank account upon the maturing of its certificates of
deposit and pending a decision to invest a significant portion of its funds in
money market equities.
The Company's rock sales decreased from the 1996 to the 1997 three month
periods. However, the 1996 reported sales included the sales from earlier
periods which had inadvertently been previously unrecorded. It is unlikely
that the Company will realize any additional rock sales before the three month
period ending August 31, 1998, because of the seasonal nature of such sales.
EXPENSES. Wages and other compensation and professional services were
both higher in the three months ended November 1997 when compared with the same
period for 1996. This was the result of the Company's efforts to renew its
reporting requirements. The Company's management believes that these expenses
will decrease throughout the balance of the year, as the Company becomes more
familiar with the reporting process. The other expenses were not significant
during the three month periods reported.
FINANCIAL POSITION. Cash and cash equivalents decreased significantly and
Marketable securities increased significantly as is discussed in Cash Flows
below. There was a $779 (71%) increase in accounts receivable from rock sales,
for which proceeds had not been collected at November 30, 1997, in the three
month period then ended.
The Company expects that it will draw down its marketable securities by
about $7,000 during the balance of the fiscal year as it pays down its accounts
Payable. The Company also expects that it will sell or abandon a significant
portion of its equipment and machinery during the balance of the fiscal year,
however this will not have a material effect on its financial position because
the machinery and equipment are fully depreciated.
7
<PAGE>
SILVER BUTTE MINING COMPANY
Form 10-QSB QUARTERLY REPORT
November 30, 1997
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (CONTINUED)
CASH FLOWS. Cash and cash equivalents decreased by $78,037 during the three
months ended November 30, 1997. Most of this decrease ($75,031) was the result
of investing in money market equity securities during the period. The
remainder of the decrease was the result of expenditures exceeding results of
operations. The Company's management believes that there will be a continued
decrease in cash and cash equivalents in future periods as the Company intends
to reduce its accounts payable balances. The Company has no plans for capital
expenditures that will require significant amounts of cash.
Cash and cash equivalents decreased only slightly ($410) during the three
months ended November 30 1996. A significant increase in receivables ($2,078)
from interest income and rock sales was offset by a significant decrease in
prepaid expenses ($2,240) that were expensed during the period. The loss from
operations was funded partially by the decrease in ash and partially by an
increase in the amount of payables ($454) during the period.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
The Company filed a Form 8-K on November 28, 1997, wherein it announced in
Item 5, Other Events, that it met the requirements of an "Inactive entity" as
defined by Section 220.3-11 of Regulation S-X. The Company is allowed to use
unaudited financial statements for purposes of reports pursuant to the
Securities Exchange Act of 1934 by meeting these requirements.
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SIGNATURE
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SILVER BUTTE MINING COMPANY
By: /s/ R. Richard Rice Date: January 14, 1998
____________________________________ ____________________________
R. Richard Rice, President
(Principal Executive Officer and Principal Accounting Officer)
8
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Condensed financial statements at November 30, 1997 (Unaudited) and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-31-1997
<PERIOD-END> NOV-30-1997
<CASH> 6,260
<SECURITIES> 75,031
<RECEIVABLES> 1,871
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 88,162
<PP&E> 22,704
<DEPRECIATION> 19,704
<TOTAL-ASSETS> 91,162
<CURRENT-LIABILITIES> 9,351
<BONDS> 0
0
0
<COMMON> 391,437
<OTHER-SE> (309,626)
<TOTAL-LIABILITY-AND-EQUITY> 91,162
<SALES> 0
<TOTAL-REVENUES> 1,661
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,329
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,668)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,668)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,668)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<PAGE>
</TABLE>
