UNITED STATES LIME & MINERALS INC (Form: 10-Q, Received: 05/03/2019 07:45:25)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ........ to ........

Commission file number is 000-04197

UNITED STATES LIME & MINERALS, INC.

(Exact name of registrant as specified in its charter)


TEXAS		75-0789226
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)


5429 LBJ Freeway, Suite 230, Dallas, TX		75240
(Address of principal executive offices)		(Zip Code)

(972) 991-8400

(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer ☒
Non-accelerated filer	☐	Smaller reporting company ☒
		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.10 par value	USLM	The NASDAQ Stock Market LLC

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date: As of May 2, 2019, 5,611,981 shares of common stock, $0.10 par value, were outstanding.

PART I. FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands)

(Unaudited)


	March 31,		December 31,
	2019		2018
ASSETS
Current assets
Cash and cash equivalents	$	68,341	$	67,218
Trade receivables, net		22,710		19,602
Inventories, net		12,821		12,846
Prepaid expenses and other current assets		1,476		1,692
Total current assets		105,348		101,358
Property, plant and equipment		353,580		348,472
Less accumulated depreciation and depletion		(208,393)		(205,708)
Property, plant and equipment, net		145,187		142,764
Operating lease right-of-use assets		4,020		—
Other assets, net		514		549
Total assets	$	255,069	$	244,671
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	6,109	$	4,570
Current portion of operating lease liabilities		1,425		—
Accrued expenses		2,343		3,393
Total current liabilities		9,877		7,963
Deferred tax liabilities, net		13,601		12,365
Operating lease liabilities, excluding current portion		2,644		—
Other liabilities		1,372		1,376
Total liabilities		27,494		21,704
Stockholders’ equity
Common stock		661		661
Additional paid-in capital		26,176		25,867
Accumulated other comprehensive loss		(33)		(13)
Retained earnings		254,939		250,568
Less treasury stock, at cost		(54,168)		(54,116)
Total stockholders’ equity		227,575		222,967
Total liabilities and stockholders’ equity	$	255,069	$	244,671

See accompanying notes to condensed consolidated financial statements.

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(dollars in thousands, except per share data)

(Unaudited)


	Three Months Ended March 31,
	2019				2018
Revenues
Lime and limestone operations	$	37,465	99.1	%	$	34,714	98.4	%
Natural gas interests		334	0.9	%		573	1.6	%
		37,799	100.0	%		35,287	100.0	%
Cost of revenues
Labor and other operating expenses		25,038	66.2	%		24,073	68.2	%
Depreciation, depletion and amortization		4,068	10.7	%		4,177	11.8	%
		29,106	76.9	%		28,250	80.0	%
Gross profit		8,693	23.1	%		7,037	20.0	%
Selling, general and administrative expenses		2,673	7.1	%		2,501	7.1	%
Operating profit		6,020	16.0	%		4,536	12.9	%
Other (income) expense
Interest expense		62	0.2	%		62	0.2	%
Interest and other income, net		(492)	(1.3)	%		(353)	(1.0)	%
		(430)	(1.1)	%		(291)	(0.8)	%
Income before income tax expense		6,450	17.1	%		4,827	13.7	%
Income tax expense		1,322	3.5	%		565	1.6	%
Net income	$	5,128	13.6	%	$	4,262	12.1	%
Net income per share of common stock
Basic	$	0.91			$	0.76
Diluted	$	0.91			$	0.76

See accompanying notes to condensed consolidated financial statements.

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(dollars in thousands)

(Unaudited)


	Three Months Ended March 31,
	2019		2018
Net income	$	5,128	$	4,262
Other comprehensive loss
Mark to market of foreign exchange hedges, net of tax benefit of $6 and $10 for the 2019 and 2018 periods, respectively		(20)		(34)
Total other comprehensive loss		(20)		(34)
Comprehensive income	$	5,108	$	4,228

See accompanying notes to condensed consolidated financial statements.

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(dollars in thousands)

(Unaudited)


						Accumulated
	Common Stock			Additional		Other
	Shares			Paid-In		Comprehensive		Retained		Treasury
	Outstanding	Amount		Capital		(Loss) Income		Earnings		Stock		Total
Balances at December 31, 2018	5,607,401	$	661	$	25,867	$	(13)	$	250,568	$	(54,116)	$	222,967
Stock-based compensation	3,333		—		309		—		—		—		309
Treasury shares purchased	(753)		—		—		—		—		(52)		(52)
Cash dividends paid	—		—		—		—		(757)		—		(757)
Net income	—		—		—		—		5,128		—		5,128
Mark to market of foreign exchange hedges, net of $6 tax benefit	—		—		—		(20)		—		—		(20)
Comprehensive (loss) income	—		—		—		(20)		5,128		—		5,108
Balances at March 31, 2019	5,609,981	$	661	$	26,176	$	(33)	$	254,939	$	(54,168)	$	227,575


						Accumulated
	Common Stock			Additional		Other
	Shares			Paid-In		Comprehensive		Retained		Treasury
	Outstanding	Amount		Capital		(Loss) Income		Earnings		Stock		Total
Balances at December 31, 2017	5,588,821	$	659	$	24,307	$	86	$	233,905	$	(53,705)	$	205,252
Stock options exercised	2,000		—		73		—		—		—		73
Stock-based compensation	2,733		—		316		—		—		—		316
Treasury shares purchased	(861)		—		—		—		—		(61)		(61)
Cash dividends paid	—		—		—		—		(755)		—		(755)
Net income	—		—		—		—		4,262		—		4,262
Mark to market of foreign exchange hedges, net of $10 tax benefit	—		—		—		(34)		—		—		(34)
Comprehensive (loss) income	—		—		—		(34)		4,262		—		4,228
Balances at March 31, 2018	5,592,693	$	659	$	24,696	$	52	$	237,412	$	(53,766)	$	209,053

See accompanying notes to condensed consolidated financial statements.

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands)

(Unaudited)


	Three Months Ended March 31,
	2019		2018
OPERATING ACTIVITIES:
Net income	$	5,128	$	4,262
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		4,121		4,230
Amortization of deferred financing costs		4		8
Deferred income taxes		1,246		471
Loss on disposition of property, plant and equipment		386		211
Stock-based compensation		309		316
Changes in operating assets and liabilities:
Trade receivables, net		(3,108)		(2,601)
Inventories, net		25		947
Prepaid expenses and other current assets		216		417
Other assets		31		20
Accounts payable and accrued expenses		(899)		(1,705)
Other liabilities		15		(56)
Net cash provided by operating activities		7,474		6,520
INVESTING ACTIVITIES:
Purchase of property, plant and equipment		(5,684)		(7,620)
Proceeds from sale of property, plant and equipment		142		108
Net cash used in investing activities		(5,542)		(7,512)
FINANCING ACTIVITIES:
Cash dividends paid		(757)		(755)
Proceeds from exercise of stock options		—		73
Purchase of treasury shares		(52)		(61)
Net cash used in financing activities		(809)		(743)
Net increase (decrease) in cash and cash equivalents		1,123		(1,735)
Cash and cash equivalents at beginning of period		67,218		85,000
Cash and cash equivalents at end of period	$	68,341	$	83,265

See accompanying notes to condensed consolidated financial statements.

UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Basis of Presentation

The condensed consolidated financial statements included herein have been prepared by United States Lime & Minerals, Inc. (the “Company”) without independent audit. In the opinion of the Company’s management, all adjustments of a normal and recurring nature necessary to present fairly the financial position, results of operations, comprehensive income and cash flows for the periods presented have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted. The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2018. The results of operations for the three-month period ended March 31, 2019 are not necessarily indicative of operating results for the full year.

2. Organization

The Company is headquartered in Dallas, Texas, and operates through two business segments. Through its Lime and Limestone Operations, the Company is a manufacturer of lime and limestone products, supplying primarily the construction (including highway, road and building contractors), industrial (including paper and glass manufacturers), environmental (including municipal sanitation and water treatment facilities and flue gas treatment processes), metals (including steel producers), oil and gas services, roof shingle manufacturers and agriculture (including poultry and cattle feed producers) industries. The Company operates lime and limestone plants and distribution facilities in Arkansas, Colorado, Louisiana, Oklahoma and Texas through its wholly owned subsidiaries, Arkansas Lime Company, Colorado Lime Company, Texas Lime Company, U.S. Lime Company, U.S. Lime Company – Shreveport, U.S. Lime Company – St. Clair and U.S. Lime Company – Transportation. In addition, the Company, through its wholly owned subsidiary, U.S. Lime Company – O & G, LLC, has royalty and non-operating working interests in natural gas wells located in Johnson County, Texas, in the Barnett Shale Formation.

3. Accounting Policies

Revenue Recognition. The Company recognizes revenue for its Lime and Limestone Operations in accordance with the terms of its purchase orders, contracts or purchase agreements, which is generally upon shipment, and when payment is considered probable. Revenues include external freight billed to customers with related costs accounted for as fulfillment costs and included in cost of revenues. The Company’s returns and allowances are minimal. External freight billed to customers in the first quarter 2019 and 2018 included in revenues was $6.9 million and $5.9 million, respectively, which approximates the amount of external freight included in cost of revenues. Sales taxes billed to customers are not included in revenues. For its Natural Gas Interests, the Company recognizes revenue in the month of production and delivery.

The Company operates its Lime and Limestone Operations within a single geographic region and derives all revenues from that segment from the sale of lime and limestone products. Revenues from the Company’s Natural Gas Interests are from the Company’s royalty and non-operating working interest in Johnson County, Texas. See Note 4 to the condensed consolidated financial statements for disaggregation of revenues by segment, which the Company believes best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

The majority of the Company’s trade receivables are unsecured. Payment terms for all trade receivables are based on the underlying purchase orders, contracts or purchase agreements. Credit losses relating to trade receivables have generally been within management expectations and historical trends. Uncollected trade receivables are charged-off when identified by management to be unrecoverable. The Company maintains an allowance for doubtful accounts to reflect estimated losses resulting from the failure of customers to make required payments.

Successful-Efforts Method Used for Natural Gas Interests. The Company uses the successful-efforts method to account for oil and gas exploration and development expenditures. Under this method, drilling, completion and workover costs for successful exploratory wells and all development well costs are capitalized and depleted using the units-of-production method. Costs to drill exploratory wells that do not find proved reserves are expensed.

Comprehensive Income. Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain changes in assets and liabilities, such as mark-to-market gains or losses on foreign exchange derivative instruments designated as hedges, are reported as a separate component of the equity section of the balance sheet. Such items, along with net income, are components of comprehensive income.

Leases. The Company determines if an arrangement is a lease at inception. When recording operating leases, the Company records a lease liability based on the net present value of the lease payments over the lease term and a corresponding right-of-use asset. Operating leases are included in operating lease right-of-use assets, current portion of operating lease liabilities and operating lease liabilities, excluding current portion, on the balance sheet. Lease expense is recognized over the lease term on a straight-line basis. Lease terms include options to extend the lease when it is reasonably certain the Company will exercise the option. For leases with a term of twelve months or less, the Company does not record a right-of-use asset and a lease liability and records lease expense on a straight-line basis. See Note 9 to the condensed consolidated financial statements.

Fair Values of Financial Instruments. Fair value is defined as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” The Company uses a three-tier fair value hierarchy, which classifies the inputs used in measuring fair values, in determining the fair value of its financial assets and liabilities. These tiers include: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Specific inputs used to value the Company’s foreign exchange hedges were Euro to U.S. Dollar exchange rates for the expected future payment dates for the Company’s commitments denominated in Euros. See Note 6 to the condensed consolidated financial statements. There were no changes in the methods and assumptions used in measuring fair value.

The Company’s financial assets and liabilities measured at fair value on a recurring basis at March 31, 2019 and December 31, 2018, respectively, are summarized below (in thousands):


					Significant Other
					Observable Inputs
					(Level 2)
	March 31,		December 31,		March 31,		December 31,
	2019		2018		2019		2018		Valuation Technique
Foreign exchange hedges	$	(42)	$	(16)	$	(42)	$	(16)	Cash flows approach

New Accounting Pronouncements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (“ASU 2016-02”), “Leases,” which requires the recognition of lease assets and lease liabilities by lessees for all leases greater than one year in duration and classified as operating leases under previous guidance. For operating leases, a lessee will be required to recognize at inception a right-of-use asset and a lease liability equal to the net present value of the lease payments, with lease expense recognized over the lease term on a straight-line basis. For leases with a term of twelve months or less, ASU 2016-02 allows a reporting entity to make an accounting policy election to not recognize a right-of-use asset and a lease liability, and to recognize lease expense on a straight-line basis. The Company adopted ASU 2016-02 at January 1, 2019, using the current-period adjustment method. Under the current-period adjustment method, a reporting entity continues to apply legacy guidance, including disclosure requirements, in the comparative periods presented in the year of adoption, recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, if any. Adoption of ASU 2016-02 resulted in an increase in assets of $3.9 million with corresponding liabilities of $3.9 million and no impact on retained earnings at January 1, 2019.

In August 2017, the FASB issued Accounting Standards Update No. 2017-12 (“ASU 2017-12”), “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities.” This standard better aligns an entity’s risk management activities and financial reporting for hedging relationships and enhances the transparency and understandability of hedge results through improved disclosures. The Company adopted ASU 2017-12 at January 1, 2019. Adoption of ASU 2017-12 had no impact on the Company’s condensed consolidated financial statements.

4. Business Segments

The Company has identified two business segments based on the distinctness of their activities and products: Lime and Limestone Operations and Natural Gas Interests. All operations are in the United States. In evaluating the operating results of the Company’s segments, management primarily reviews revenues and gross profit. The Company does not allocate corporate overhead, interest expense or interest income to its business segments.

The following table sets forth operating results and certain other financial data for the Company’s two business segments (in thousands):


	Three Months Ended March 31,
Revenues	2019		2018
Lime and limestone operations	$	37,465	$	34,714
Natural gas interests		334		573
Total revenues	$	37,799	$	35,287
Depreciation, depletion and amortization
Lime and limestone operations	$	3,929	$	4,012
Natural gas interests		139		165
Total depreciation, depletion and amortization	$	4,068	$	4,177
Gross profit
Lime and limestone operations	$	8,686	$	6,793
Natural gas interests		7		244
Total gross profit	$	8,693	$	7,037
Capital expenditures
Lime and limestone operations	$	5,684	$	7,620
Natural gas interests		—		—
Total capital expenditures	$	5,684	$	7,620

5. Income Per Share of Common Stock

The following table sets forth the computation of basic and diluted income per common share (in thousands, except per share amounts):


	Three Months Ended March 31,
	2019		2018
Net income for basic and diluted income per common share	$	5,128	$	4,262
Weighted-average shares for basic income per common share		5,609		5,590
Effect of dilutive securities:
Employee and director stock options (1)		6		8
Adjusted weighted-average shares and assumed exercises for diluted income per common share		5,615		5,598
Basic net income per common share	$	0.91	$	0.76
Diluted net income per common share	$	0.91	$	0.76

⁽¹⁾

Excludes 27 and 17 stock options for the three-month 2019 and 2018 periods, respectively, as anti-dilutive because the exercise price exceeded the average per share market price for the period.

6. Accumulated Other Comprehensive Income

The following table presents the components of comprehensive income (in thousands):


	Three Months Ended March 31,
	2019		2018
Net income	$	5,128	$	4,262
Mark to market of foreign exchange hedges		(26)		(44)
Deferred income tax benefit		6		10
Comprehensive income	$	5,108	$	4,228

In November 2016, to hedge against potential losses due to changes in the Euro to U.S. Dollar exchange rates, the Company entered into foreign exchange (“FX”) hedges with Wells Fargo Bank, N.A. (“Wells Fargo”) as the counterparty to the FX hedges to fix the exchange rates for 5.5 million Euros in connection with a contractual obligation related to the St. Clair kiln project, of which FX hedges with respect to 0.4 million Euros remained outstanding at March 31, 2019. In May 2018, the Company entered into additional FX hedges with Wells Fargo to fix the exchange rate for 2.2 million Euros in connection with a contractual obligation related to the purchase and installation of equipment at Arkansas Lime Company, of which FX hedges with respect to 0.3 million Euros remained outstanding at March 31 2019. At March 31, 2019 and December 31, 2018, the Company had total FX hedges fixing the exchange rates for 0.7 million Euros and 1.4 million Euros, respectively. The Company will be exposed to credit losses in the event of non-performance by the counterparty to the FX hedges. The FX hedges have been effective as defined under applicable accounting rules. Therefore, changes in the fair value of the FX hedges are reflected in comprehensive income. Due to changes in the U.S. Dollar, compared to the Euro, the fair value of the hedges resulted in net liabilities of $42 and $16 at March 31, 2019 and December 31, 2018, respectively, which is included in accrued expenses.

7. Inventories, Net

Inventories are valued principally at the lower of cost, determined using the average cost method, or market. Costs for raw materials and finished goods include materials, labor, and production overhead. Inventories, net consisted of the following (in thousands):


	March 31,		December 31,
	2019		2018
Lime and limestone inventories:
Raw materials	$	4,813	$	4,693
Finished goods		1,830		2,153
		6,643		6,846
Service parts inventories		6,178		6,000
	$	12,821	$	12,846

8. Banking Facilities and Debt

At March 31, 2019, the Company’s credit agreement with Wells Fargo Bank, N.A. (the “Lender”) provided for a $75 million revolving credit facility (the “Revolving Facility”) and an incremental four-year accordion feature to borrow up to an additional $50 million on the same terms, subject to approval by the Lender or another lender selected by the Company. The credit agreement also provided for a $10 million letter of credit sublimit under the Revolving Facility. The Revolving Facility and any incremental borrowings were scheduled to mature on May 7, 2020, prior to an amendment entered into on May 2, 2019 to extend the maturity date to May 2, 2024 and renew the four-year accordion feature (see Note 12 to the condensed consolidated financial statements).

Interest rates on the Revolving Facility are, at the Company’s option, LIBOR plus a margin of 1.000% to 2.000%, or the Lender’s Prime Rate plus a margin of 0.000% to 1.000%; and a commitment fee range of 0.200% to 0.350% on the undrawn portion of the Revolving Facility. The Revolving Facility interest rate margins and commitment fee are determined quarterly in accordance with a pricing grid based upon the Company’s Cash Flow Leverage Ratio,

defined as the ratio of the Company’s total funded senior indebtedness to earnings before interest, taxes, depreciation, depletion, amortization and stock-based compensation expense (“EBITDA”) for the 12 months ended on the last day of the most recent calendar quarter, plus pro forma EBITDA from any businesses acquired during the period. Pursuant to a security agreement, dated August 25, 2004, the Revolving Facility is secured by the Company’s existing and hereafter acquired tangible assets, intangible assets and real property. The maturity of the Revolving Facility and any incremental loans can be accelerated if any event of default, as defined under the credit agreement, occurs. The Company’s maximum Cash Flow Leverage Ratio is 3.50 to 1. Other than the extension of the maturity date of the Revolving Facility and any incremental borrowings to May 2, 2024 and the renewal of the four-year accordion feature, the amendment discussed in Note 12 did not significantly modify any of the key terms of the credit agreement.

The Company may pay dividends so long as it remains in compliance with the provisions of the Company’s credit agreement, and may purchase, redeem or otherwise acquire shares of its common stock so long as its pro forma Cash Flow Leverage Ratio is less than 3.00 to 1.00 and no default or event of default exists or would exist after giving effect to such stock repurchase.

As of March 31, 2019, the Company had no debt outstanding and no draws on the Revolving Facility other than $1.2 million of letters of credit, including $0.8 million related to the St. Clair kiln project, which count as draws against the available commitment under the Revolving Facility.

9. Leases

The Company has operating leases for the use of equipment, corporate office space, and some of its terminal and distribution facilities. The leases have remaining lease terms of 0 to 6 years, with a weighted-average remaining lease term of 3 years at March 31, 2019. Some operating leases include options to extend the leases for up to 5 years. At January 1, 2019, upon implementation of ASU 2016-02, the liability for the Company’s operating leases was discounted to present value using a weighted-average discount rate of 3.5%. The components of lease costs for the three months ended March 31, 2019 were as follows:


		Three Months Ended March 31,
	Classification	2019
Operating lease cost (1)	Cost of revenues	$	486
Operating lease cost	Selling, general and administrative		53
Rental revenues	Other (income) expense		(12)
Net lease cost		$	527

(1) Includes the costs of leases with a term of 12 months or less.

As of March 31, 2019, future minimum payments under operating leases that were either non-cancelable or subject to significant penalty upon cancellation, including future minimum payments under renewal options that the Company is reasonably certain to exercise, were as follows:



2019 (excluding the three months ended March 31, 2019)	$	1,194
2020		1,315
2021		1,074
2022		437
2023		150
Thereafter		138
Total future minimum lease payments		4,308
Less imputed interest		(239)
Present value of lease liabilities	$	4,069

Supplemental cash flow information pertaining to the Company’s leasing activity for the three months ended March 31, 2019 was as follows:


	Three Months Ended March 31,
	2019
Cash payments for operating lease liabilities	$	375
Right-of-use assets obtained in exchange for operating lease obligations	$	484

10. Income Taxes

The Company has estimated that its effective income tax rate for 2019 will be 20.5%. The primary reason for the effective income tax rate being below the federal statutory rate is due to statutory depletion, which is allowed for income tax purposes and is a permanent difference between net income for financial reporting purposes and taxable income. In 2018, the effective income tax rate was further reduced from the federal statutory rate due to research and development tax credits associated with the construction of the St. Clair kiln project.

11. Dividends

The Company paid $0.8 million in cash dividends, based on a dividend of $0.135 (13.5 cents) per share on its common stock, to shareholders in each of the first quarters 2019 and 2018.

12. Subsequent Event

On May 1, 2019, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.135 (13.5 cents) per share on the Company’s common stock. This dividend is payable on June 14, 2019 to shareholders of record at the close of business on May 24, 2019.

On May 2, 2019, the Company amended its credit agreement with the Lender. The terms of the amended credit agreement provide for a final maturity date of the Revolving Facility and any incremental borrowings of May 2, 2024. Other key terms of the credit agreement, including the amounts provided for under the Revolving Facility and the four-year accordion feature, the interest rates and the commitment fees, were unchanged by the amendment. See Note 8 to the condensed consolidated financial statements.

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements. Any statements contained in this Report 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 Report, including without limitation statements relating to the Company’s plans, strategies, objectives, expectations, intentions, and adequacy of resources, are identified by such words as “will,” “could,” “should,” “would,” “believe,” “possible,” “potential,” “expect,” “intend,” “plan,” “schedule,” “estimate,” “anticipate” and “project.” The Company undertakes no obligation to publicly update or revise any forward‑looking statements. The Company cautions that forward‑looking statements involve risks and uncertainties that could cause actual results to differ materially from expectations, including without limitation the following: (i) the Company’s plans, strategies, objectives, expectations, and intentions are subject to change at any time at the Company’s discretion; (ii) the Company’s plans and results of operations will be affected by its ability to maintain and increase its revenues and manage its growth; (iii) the Company’s ability to meet short‑term and long‑term liquidity demands, including meeting the Company’s operating and capital needs, including for the modernization and expansion and development project at St. Clair and possible acquisitions, repurchasing the Company’s common stock and paying dividends, and conditions in the credit and equity markets, including the ability of the Company’s customers to meet their obligations; (iv) interruptions to operations and increased expenses at the Company’s facilities resulting from changes in mining methods or conditions, variability of chemical or physical properties of the Company’s limestone and its impact on process equipment and product quality, inclement weather conditions, natural disasters, accidents, IT systems failures or disruptions, including due to cyber security incidents or regulatory requirements; (v) volatile coal, petroleum coke, diesel, natural gas, electricity, transportation and freight costs and the consistent availability of trucks, truck drivers and rail cars to deliver the Company’s products to its customers and solid fuels to its plants on a timely basis at competitive prices; (vi) unanticipated delays or cost overruns in completing modernization and expansion and development projects, including the Company’s St. Clair kiln project that is estimated to cost approximately $50 million in total; (vii) the Company’s ability to expand its Lime and Limestone Operations through projects and acquisitions of businesses with related or similar operations, including obtaining financing for such projects and acquisitions, and to sell any resulting increased production at acceptable prices; (viii) inadequate demand and/or prices for the Company’s lime and limestone products due to increased competition from competitors, increasing competition for certain customer accounts, conditions in the U.S. economy, recessionary pressures in, and the impact of government policies on particular industries, including construction, steel, industrial and oil and gas services, reduced demand from utility plants, effects of governmental fiscal and budgetary constraints, including the level of highway construction and infrastructure funding, the impact of tax reform or further changes to the corporate tax code, legislative impasses, trade wars, tariffs, economic and regulatory uncertainties under state governments and the United States Administration and Congress and inability to continue to maintain or increase prices for the Company’s products, including passing through the increased costs of transportation; (ix) uncertainties of prices and regulations with respect to the Company’s Natural Gas Interests, including the absence of drilling activities on the Company’s O & G Properties, any risks the Company may experience with the change in the operators of the wells drilled on the O & G Properties, inability to explore for new reserves, unitization of existing wells, declines in production rates and plugging and abandoning of existing wells; (x) ongoing and possible new regulations, investigations, enforcement actions and costs, legal expenses, penalties, fines, assessments, litigation, judgments and settlements, taxes and disruptions and limitations of operations, including those related to climate change and health and safety and those that could impact the Company’s ability to continue or renew its operating permits or successfully secure new permits in connection with its modernization and expansion and development projects; (xi) estimates of reserves and remaining lives of reserves; and (xii) other risks and uncertainties set forth in this Report or indicated from time to time in the Company’s filings with the Securities and Exchange Commission (the “SEC”), including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

Overview.

We have two operating segments: Lime and Limestone Operations and Natural Gas Interests. Revenues and gross profit are the primary items utilized to evaluate the operating results of our segments and to allocate resources.

Through our Lime and Limestone Operations, we are a manufacturer of lime and limestone products, supplying primarily the construction (including highway, road and building contractors), industrial (including paper and glass

manufacturers), environmental (including municipal sanitation and water treatment facilities and flue gas treatment processes), metals (including steel producers), roof shingle manufacturers, oil and gas services and agriculture (including poultry and cattle feed producers) industries. We are headquartered in Dallas, Texas and operate lime and limestone plants and distribution facilities in Arkansas, Colorado, Louisiana, Oklahoma and Texas through our wholly owned subsidiaries, Arkansas Lime Company, Colorado Lime Company, Texas Lime Company, U.S. Lime Company, U.S. Lime Company – Shreveport, U.S. Lime Company – St. Clair and U.S. Lime Company – Transportation. The Lime and Limestone Operations represent our principal business.

Our Natural Gas Interests are held in our wholly owned subsidiary, U.S. Lime Company – O & G, LLC, and consist of royalty and non-operating working interests under the O & G Lease with affiliated companies of Enervest, Ltd. and the Drillsite Agreement with XTO Energy, Inc. related to our Johnson County, Texas property, located in the Barnett Shale Formation, on which Texas Lime Company conducts its lime and limestone operations. No new wells have been drilled or completed on the O & G Properties since 2011. We cannot predict if any additional wells will be drilled on the O & G Properties, or their results.

Revenues from our Lime and Limestone Operations increased 7.9% in the first quarter 2019, compared to the first quarter 2018. The increase in revenues in the first quarter 2019 resulted from increased sales volume of 6.1% for our lime and limestone products, principally from construction customers. During the first quarter 2018, inclement weather conditions in Texas negatively impacted demand from our construction customers. Precipitation in Texas during the first quarter 2019 was more in line with historical averages and less disruptive to construction demand. Average prices realized for our lime and limestone products increased 1.8% in the first quarter 2019, compared to the first quarter 2018.

Gross profit from our Lime and Limestone Operations increased by 27.9% in the first quarter 2019 compared to the first quarter 2018. The increased gross profit from our Lime and Limestone Operations in the first quarter 2019, compared to the first quarter 2018, resulted primarily from the increased revenues discussed above.

Revenues from our Natural Gas Interests decreased 41.7% in the first quarter 2019 compared to the first quarter 2018, resulting primarily from lower prices and decreased production volumes resulting from the normal declines in production rates on our 39 existing natural gas wells. Gross profit from our Natural Gas Interests decreased 97.1% in the first quarter 2019, compared to the first quarter 2018, as a result of the decreased revenues.

In the first quarter 2019, we applied heat to our new vertical kiln at St. Clair and began testing lime production. The new kiln is part of a modernization and expansion and development project, which we estimate will cost a total of approximately $50 million. Through the first quarter of 2019, we had incurred approximately $41.2 million on the project, of which $39.7 million had been paid in cash. We will begin to depreciate the new kiln and related equipment when they consistently produce commercially saleable quicklime, which we anticipate will occur in the second quarter 2019.

In December 2015, we commenced a publicly announced share repurchase program to purchase up to $10 million of our common stock. In November 2018, we announced a 12-month extension of the repurchase program through November 2019 to repurchase up to the $7.2 million of our common stock remaining under the program. No shares have been repurchased under the program since the first quarter 2016.

We paid a regular quarterly cash dividend of $0.135 (13.5 cents) per share on our common stock in the first quarter 2019. On May 1, 2019, the Board of Directors declared a regular quarterly cash dividend of $0.135 (13.5 cents) per share on our common stock. This dividend is payable on June 14, 2019 to shareholders of record at the close of business on May 24, 2019 .

Liquidity and Capital Resources.

Net cash provided by operating activities was $7.5 million in the first quarter 2019, compared to $6.5 million in the first quarter 2018, an increase of $1.0 million, or 14.6%. Our net cash provided by operating activities is composed of net income, depreciation, depletion and amortization (“DD&A”), other non‑cash items included in net income and

changes in working capital. In the first quarter 2019, net cash provided by operating activities was principally composed of $5.1 million net income, $4.1million DD&A, $0.4 million loss on disposition of equipment, $0.3 million stock‑based compensation, $1.2 million deferred income taxes and a $3.7 million decrease from changes in operating assets and liabilities. Changes in operating assets and liabilities in the first quarter 2019 included an increase of $3.1 million in trade receivables, net, a decrease of $0.2 million in prepaid expenses and other current assets and a decrease of $0.9 million in accounts payable and accrued expenses. In the first quarter 2018, net cash provided by operating activities was principally composed of $4.3 million net income, $4.2 million DD&A, $0.3 million stock‑based compensation, $0.5 million deferred income taxes and a $2.9 million decrease from changes in operating assets and liabilities. Changes in operating assets and liabilities in the first quarter 2018 included an increase of $2.6 million in trade receivables, net, a decrease of $0.9 million of inventories, net, a decrease of $0.4 million in prepaid expenses and other current assets and a decrease of $1.7 million in accounts payable and accrued expenses.

We had $5.7 million in capital expenditures in the first quarter 2019, including $0.7 million on the St. Clair kiln project, compared to $7.6 million in the first quarter 2018, including $5.2 million on the St. Clair kiln project. As of March 31, 2019, we had incurred a total of $41.2 million on the St. Clair kiln project, of which $39.7 million had been paid in cash. We anticipate that most of the balance of the approximately $50 million total cost of the project will be incurred and paid by the end of 2019.

Net cash used in financing activities was $0.8 million in the first quarter 2019, compared to $0.7 million in the first quarter 2018, consisting primarily of cash dividends paid in each period.

Cash and cash equivalents increased $1.1 million to $68.3 million at March 31, 2019, from $67.2 million at December 31, 2018.

At March 31, 2019, our credit agreement with Wells Fargo Bank, N.A. (the “Lender”) provided for a $75 million revolving credit facility (the “Revolving Facility”) and an incremental four-year accordion feature to borrow up to an additional $50 million on the same terms, subject to approval by the Lender or another lender selected by us. The credit agreement also provided for a $10 million letter of credit sublimit under the Revolving Facility.

Interest rates on the Revolving Facility are, at our option, LIBOR plus a margin of 1.000% to 2.000%, or the Lender’s Prime Rate plus a margin of 0.000% to 1.000%; and a commitment fee range of 0.200% to 0.350% on the undrawn portion of the Revolving Facility. The Revolving Facility interest rate margins and commitment fee are determined quarterly in accordance with a pricing grid based upon our Cash Flow Leverage Ratio, defined as the ratio of our total funded senior indebtedness to earnings before interest, taxes, depreciation, depletion, amortization and stock-based compensation expense (“EBITDA”) for the 12 months ended on the last day of the most recent calendar quarter, plus pro forma EBITDA from any businesses acquired during the period. Pursuant to a security agreement, dated August 25, 2004, the Revolving Facility is secured by our existing and hereafter acquired tangible assets, intangible assets and real property. The maturity of the Revolving Facility and any incremental loans can be accelerated if any event of default, as defined under the credit agreement, occurs. Our maximum Cash Flow Leverage Ratio is 3.50 to 1.

We may pay dividends so long as we remain in compliance with the provisions of our credit agreement, and we may purchase, redeem or otherwise acquire shares of our common stock so long as our pro forma Cash Flow Leverage Ratio is less than 3.00 to 1.00 and no default or event of default exists or would exist after giving effect to such stock repurchase.

On May 2, 2019, we entered into a seventh amendment, dated as of May 2, 2019 (the “Amendment”), to our credit agreement with the Lender. We entered into the Amendment to extend the final maturity date of the Revolving Facility and any incremental borrowings to May 2, 2024 and renew the four-year accordion feature. Other key terms of the credit agreement, including the amounts provided for under the Revolving Facility and the four-year accordion feature, the interest rates and the commitment fees, were unchanged by the Amendment. The foregoing description of the Amendment is hereby qualified in its entirety by reference to the full text of the Amendment, which is filed herewith as Exhibit 10.1 under Item 6 of Part II of this Report and incorporated by reference herein.

We are not contractually committed to any planned capital expenditures until actual orders are placed for equipment. As of March 31, 2019, we had approximately $0.8 million of commitments for open orders related to planned capital expenditures, including approximately $0.5 million related to the St. Clair kiln project.

At March 31, 2019, we had no debt outstanding and no draws on the Revolving Facility other than $1.2 million of letters of credit, including $0.8 million related to the St. Clair kiln project, which count as draws against the available commitment under the Revolving Facility. We believe that, absent a significant acquisition, cash on hand and cash flows from operations will be sufficient to meet our operating needs, ongoing capital needs, including current and possible modernization and expansion and development projects such as the kiln project at St. Clair, and liquidity needs and allow us to repurchase up to $7.2 million of our common stock remaining to be repurchased under our extended share repurchase program as well as pay regular cash dividends for the near future.

Results of Operations.

Revenues in the first quarter 2019 were $37.8 million, compared to $35.3 million in the first quarter 2018, an increase of $2.5 million, or 7.1%. Revenues from our Lime and Limestone Operations in the first quarter 2019 increased $2.8 million, or 7.9%, to $37.5 million from $34.7 million in the first quarter 2018, while revenues from our Natural Gas Interests decreased $239 thousand, or 41.7%, to $334 thousand in the first quarter 2019 from $573 thousand in the first quarter 2018. The increase in lime and limestone revenues in the first quarter 2019, compared to the first quarter 2018, resulted primarily from the increased sales volumes of our lime and limestone products.

Production volumes from our Natural Gas Interests in the first quarter 2019 totaled 118 thousand MCF, sold at an average price of $2.84 per MCF, compared to 130 thousand MCF, sold at an average price of $4.41 per MCF, in the first quarter 2018. Our average prices per MCF in the first quarter 2019 were lower than average prices for the first quarter 2018 primarily due to decreases in market prices for natural gas and natural gas liquids.

Gross profit was $8.7 million in the first quarter 2019, compared to $7.0 million in the first quarter 2018, an increase of $1.7 million, or 23.5%. Gross profit from our Lime and Limestone Operations in the first quarter 2019 was $8.7 million, an increase of $1.9 million, or 27.9%, from $6.8 million in the first quarter 2018. Gross profit margin as a percentage of revenues from our Lime and Limestone Operations increased in the first quarter 2019 to 23.2% from 19.6% in the first quarter 2018. The increase in gross profit and gross profit margin in the first quarter 2019, compared to the first quarter 2018, resulted primarily from the increase in revenues discussed above.

Gross profit from our Natural Gas Interests decreased to $7 thousand in the first quarter 2019 from $244 thousand in the first quarter 2018, a decrease of $237 thousand. The decreased gross profit for our Natural Gas Interests resulted from the decrease in revenues discussed above.

Selling, general and administrative expenses (“SG&A”) were $2.7 million and $2.5 million in the first quarters 2019 and 2018, respectively. As a percentage of revenues, SG&A was 7.1% in each of the first quarters 2019 and 2018.

Interest expense was $0.1 million in each of the first quarters 2019 and 2018, as we had no outstanding debt during either period. Interest and other income, net increased $0.1 million, or 39.4%, to $0.5 million income in the first quarter 2019 from $0.4 million income in the first quarter 2018, due to increased interest rates received on cash and cash equivalents in the 2019 period.

Income tax expense increased to $1.3 million in the first quarter 2019, compared to $0.6 million in the first quarter 2018, an increase of $0.8 million, or 134.0%. The increases in income tax expense in the first quarter 2019 was due to increased income in the first quarter 2019, compared to 2018, and research and development tax credits in the first quarter 2018 associated with the construction of the St. Clair kiln project. Our effective income tax rate for each of the first quarters 2019 and 2018 was reduced from the federal rate primarily due to statutory depletion, which is allowed for income tax purposes and is a permanent difference between net income for financial reporting purposes and taxable income. Our effective income tax rate for the first quarter 2018 was further reduced from the federal rate due to research and development tax credits discussed above.

Our net income was $5.1 million ($0.91 per share diluted) in the first quarter 2019, compared to net income of $4.3 million ($0.76 per share diluted) in the first quarter 2018, an increase of $0.9 million, or 20.3%.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk.

We could be exposed to changes in interest rates, primarily as a result of floating interest rates on the Revolving Facility. There was no outstanding balance on the Revolving Facility subject to interest rate risk at March 31, 2019. Any future borrowings under the Revolving Facility would be subject to interest rate risk. See Note 8 of Notes to Condensed Consolidated Financial Statements.

Foreign Exchange Risk.

At March 31, 2019, we had contracts related to the purchase and installation of equipment that require future payments totaling 0.7 million Euros. We have entered into foreign exchange hedges fixing our U.S. Dollar liability at $0.8 million. We could be exposed to changes in the Euro to U.S. Dollar exchange rates for obligations not effectively fixed by the hedges. See Note 6 of Notes to Condensed Consolidated Financial Statements.

ITEM 4: CONTROLS AND PROCEDURES

Our management, with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Report. Based upon that evaluation, the CEO and CFO concluded that our disclosure controls and procedures as of the end of the period covered by this Report were effective.

No change in our internal control over financial reporting occurred during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In December 2015, we commenced a publicly announced share repurchase program to repurchase up to $10 million of our common stock. In November 2018, we announced a 12-month extension of the repurchase program through November 2019 to repurchase up to the $7.2 million of our common stock remaining under the program. We did not repurchase any shares pursuant to this program in the first quarter 2019.

In addition, our Amended and Restated 2001 Long- Term Incentive Plan allows employees and directors to pay the exercise price for stock options and the tax withholding liability upon the lapse of restrictions on restricted stock by payment in cash and/or delivery of shares of common stock. In the first quarter 2019, pursuant to these provisions, we repurchased 753 shares at a price of $68.59 per share, the fair market value of one share of our common stock on the date that they were tendered for payment of tax withholding liability upon the lapse of restrictions on restricted stock.

ITEM 4: MINE SAFETY DISCLOSURES

Under Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of SEC Regulation S‑K, each operator of a coal or other mine is required to include disclosures regarding certain mine safety results in its periodic reports filed with the SEC. The operation of our quarries, underground mine and plants is subject to regulation by the federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977. The required information regarding certain mining safety and health matters, broken down by mining complex, for the quarter ended March 31, 2019 is presented in Exhibit 95.1 to this Report.

We believe we are responsible to employees to provide a safe and healthy workplace environment. We seek to accomplish this by: training employees in safe work practices; openly communicating with employees; following safety standards and establishing and improving safe work practices; involving employees in safety processes; and recording, reporting and investigating accidents, incidents and losses to avoid reoccurrence.

Following passage of the Mine Improvement and New Emergency Response Act of 2006, MSHA significantly increased the enforcement of mining safety and health standards on all aspects of mining operations. There has also been an increase in the dollar penalties assessed for citations and orders issued in recent years.

ITEM 5: OTHER INFORMATION

The information required by this Item is hereby incorporated by reference from the description of the Amendment set forth in Item 2 of Part I of this Report under the heading “Liquidity and Capital Resources.”

ITEM 6: EXHIBITS

The Exhibit Index set forth below is incorporated by reference in response to this Item.

EXHIBIT INDEX


EXHIBIT
NUMBER		DESCRIPTION
10.1		Seventh Amendment to the Credit Agreement, dated as of May 2, 2019, among United States Lime & Minerals, Inc., each lender from time to time a party thereto, and Wells Fargo Bank, N.A., as administrative agent.

31.1		Rule 13a-14(a)/15d-14(a) Certification by the Chief Executive Officer.

31.2		Rule 13a-14(a)/15d-14(a) Certification by the Chief Financial Officer.

32.1		Section 1350 Certification by the Chief Executive Officer.

32.2		Section 1350 Certification by the Chief Financial Officer.

95.1		Mine Safety Disclosures.

101		Interactive Data Files.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	UNITED STATES LIME & MINERALS, INC.


May 3, 2019	By:	/s/ Timothy W. Byrne
		Timothy W. Byrne
		President and Chief Executive Officer
		(Principal Executive Officer)


May 3, 2019	By:	/s/ Michael L. Wiedemer
		Michael L. Wiedemer
		Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer)

SEVENTH AMENDMENT TO CREDIT AGREEMENT

This Seventh Amendment to Credit Agreement (the " Amendment "), dated as of May 2 2019, is among UNITED STATES LIME & MINERALS, INC., a Texas corporation (the " Borrower "), the financial institutions and other lenders listed on the signature pages hereof (such financial institutions and lenders, together with their respective successors and assigns, are referred to hereinafter each individually as a " Lender " and collectively as " Lenders "), and WELLS FARGO BANK, N.A., as administrative agent for the Lenders (the " Administrative Agent ").

RECITALS:

A. The Borrower, certain of the Lenders and the Administrative Agent entered into that certain Credit Agreement dated as of August 25, 2004, as amended by the First Amendment to Credit Agreement dated as of August 31, 2005, by the Second Amendment to Credit Agreement dated as of October 19, 2005, by the Third Amendment to Credit Agreement dated as of March 31, 2007, by the Fourth Amendment to Credit Agreement dated as of June 1, 2010, by the Fifth Amendment to Credit Agreement dated as of May 7, 2015 and by the Sixth Amendment to Credit Agreement dated as of October 27, 2016 (said Credit Agreement as amended, extended, renewed or restated from time to time, the " Credit Agreement ").

B. The Borrower has requested certain amendments to the Credit Agreement, including an extension of the Revolving Maturity Date.

C. The Lenders, the Administrative Agent and the Swing Line Lender hereby agree to amend the Credit Agreement on and subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable considerations, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

Definitions

1.1 Definitions . Capitalized terms used in this Amendment, to the extent not otherwise defined herein, shall have the same meanings as in the Credit Agreement as amended hereby, and all references to "Sections," "clauses," "Articles," "Exhibits," and "Schedules" are references to the Credit Agreement's sections, clauses, articles, exhibits and schedules.

ARTICLE II

Amendments to Credit Agreement

2.1 Amendments to Section 1.01 . Section 1.01 of the Credit Agreement is amended as follows:

(a) The definition of " Capital Lease " is hereby amended to add the following proviso to the end of such definition:

provided , that for purposes of calculations made pursuant to the terms of this Agreement, GAAP will be deemed to treat leases in a manner consistent with its current treatment under generally accepted accounting principles as of the Closing Date, notwithstanding any modifications or interpretative changes thereto that may occur. For the avoidance of doubt, any lease that would be characterized as an operating lease in accordance with GAAP on the Closing Date (whether or not such operating lease was in effect on such date) shall continue to be accounted for as an operating lease (and not as a Capitalized Lease) for purposes of this Agreement regardless of any change in GAAP following the Closing Date that would otherwise require such lease to be re-characterized (on a prospective or retroactive basis or otherwise) as a Capitalized Lease.

(b) The definition of " Change of Control " is hereby amended to delete the final sentence thereof and to replace it to read as follows:

As used above, "Inberdon" means Inberdon Enterprises, Ltd., a Malta corporation or its corporate successors, or its Affiliates.

(c) The definition of " Consolidated Interest Charges " is hereby amended to capitalize the term "capital leases" contained therein so that it reads "Capital Leases".

(d) The definition of " LIBOR " is hereby amended and restated to read as follows:

" LIBOR " means, subject to the implementation of a Replacement Rate in accordance with Section 3.03(c) , for any Interest Period with respect to any LIBOR Loan, the rate of interest per annum determined on the basis of the rate for deposits in Dollars for a period equal to the applicable Interest Period as published by the ICE Benchmark Administration Limited, a United Kingdom company, or a comparable or successor quoting service approved by the Administrative Agent, at approximately 11:00 a.m. (London time) two (2) London Banking Days prior to the first day of the applicable Interest Period. If, for any reason, such rate is not so published then "LIBOR" shall be determined by the Administrative Agent to be the arithmetic average of the rate per annum at which deposits in Dollars would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) two (2) London Banking Days prior to the first day of the applicable Interest Period for a period equal to such Interest Period. Each calculation by the Administrative Agent of LIBOR shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding the foregoing, (a) in no event shall LIBOR (including, without limitation, any Replacement Rate with respect thereto) be less than 0% and (b) unless otherwise specified in any amendment to this Agreement entered into in accordance with Section 3.03(c) , in the event that a Replacement Rate with respect to LIBOR is implemented then all references herein to LIBOR shall be deemed references to such Replacement Rate.

(e) The definition of " Material Real Estate " is hereby amended and restated to read as follows:

" Material Real Estate " means a parcel of real estate owned by the Borrower or a Guarantor that has a fair market value of at least $5,000,000.

(f) The definition of " Revolving Maturity Date " is amended by deleting therefrom the date "May 7, 2020" and inserting in lieu thereof the date "May 2, 2024".

(g) The following definitions are hereby added to Section 1.01 in appropriate alphabetical order to read as follows:

" Anti-Corruption Laws " means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption, including, without limitation, the United States Foreign Corrupt Practices Act of 1977 and the rules and regulations thereunder and the U.K. Bribery Act 2010 and the rules and regulations thereunder.

" Anti-Money Laundering Laws " means any and all laws, statutes, regulations or obligatory government orders, decrees, ordinances or rules applicable to a Loan Party or its Subsidiaries related to terrorism financing or money laundering, including any applicable provision of the Patriot Act and The Currency and Foreign Transactions Reporting Act (also known as the "Bank Secrecy Act," 31 U.S.C. §§ 5311-5330 and 12U.S.C. §§ 1818(s), 1820(b) and 1951-1959).

" Beneficial Ownership Certification " means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

" Beneficial Ownership Regulation " means 31 CFR § 1010.230.

" OFAC " means the U.S. Department of the Treasury's Office of Foreign Assets Control.

" Replacement Rate " shall have the meaning set forth in Section 3.03 hereof.

" Sanctioned Country " means at any time, a country or territory which is itself the subject or target of any Sanctions (including, as of the Closing Date, Cuba, Iran, North Korea, Sudan, Syria and Crimea).

" Sanctioned Person " means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC (including, without limitation, OFAC's Specially Designated Nationals and Blocked Persons List and OFAC's Consolidated Non-SDN List) , the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty's Treasury, or other relevant sanctions authority, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in clauses (a) and (b), including a Person that is deemed by OFAC to be a Sanctions target based on the ownership of such legal entity by Sanctioned Peron(s) .

" Sanctions " means any and all economic or financial sanctions, sectoral sanctions, secondary sanctions, trade embargoes and anti-terrorism laws, including but not limited to those imposed, administered or enforced from time to time by the U.S. government (including those administered by OFAC or the U.S. Department of State), the United Nations Security Council, the European Union, Her Majesty's Treasury, or other relevant sanctions authority with jurisdiction over the Administrative Agent, the Borrower or any of its Subsidiaries.

2.2 Amendment to Section 2.06(d) . Section 2.06(d) of the Credit Agreement is hereby amended to delete the reference to "$5,000,000" and replace it with a reference to "$15,000,000".

2.3 Amendment to Section 2.15 . The first sentence of Section 2.15(a) of the Credit Agreement is hereby amended and restated to read as follows:

At any time up until 365 days prior to the Revolving Maturity Date, the Borrower may by written notice to the Administrative Agent elect to request the establishment of one or more increases in the Revolving Commitments (any such increase, an "Incremental Revolving Credit Commitment") to make additional revolving credit loans (any such increase, an "Incremental Revolving Credit Increase" or the "Incremental Loans"); provided that (i) the total aggregate principal amount for all such Incremental Revolving Credit Commitments shall not (as of any date of incurrence thereof) exceed $50,000,000 and (ii) the total aggregate amount for each Incremental Revolving Credit Commitment (and the Incremental Loans made thereunder) shall not be less than a minimum principal amount of $10,000,000 or, if less, the remaining amount permitted pursuant to the foregoing clause (i).

2.4 Amendment to Section 3.03 . Section 3.03 of the Credit Agreement is hereby amended and restated to read as follows:

Section 3.03 LIBOR Unavailability; Inability to Determine Rates .

(a) Circumstances Affecting LIBOR Availability . Unless and until a Replacement Rate is implemented in accordance with clause (c) below, in connection with any request for a LIBOR Loan or a conversion to or continuation thereof or otherwise, if for any reason (i) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such LIBOR Loan, (ii) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that reasonable and adequate means do not exist for the ascertaining LIBOR for such Interest Period with respect to a proposed LIBOR Loan or (iii) the Required Lenders shall determine (which determination shall be conclusive and binding absent manifest error) that LIBOR does not adequately and fairly reflect the cost to such Lenders of making or maintaining such LIBOR Loans during such Interest Period, then the Administrative Agent shall promptly give notice thereof to the Borrower. Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer exist, the obligation of the Lenders to make LIBOR Loans and the right of the Borrower to convert any Loan to or continue any Loan as a LIBOR Loan shall be suspended, and the Borrower shall either (A) repay in full (or cause to be repaid in full) the then outstanding principal amount of each such LIBOR Loan together with accrued interest thereon on the last day of the then current Interest Period applicable to such LIBOR Loan; or (B) convert the then outstanding principal amount of each such LIBOR Loan to a Base Rate Loan as of the last day of such Interest Period.

(b) Intentionally Omitted .

(c) Alternative Rate of Interest . Notwithstanding anything to the contrary in Section 3.03(a) above, if the Administrative Agent has made the determination (such determination to be conclusive absent manifest error) that (i) the circumstances described in Section 3.03(a)(i) or (a)(ii) have arisen and that such circumstances are unlikely to be temporary, (ii) any applicable interest rate specified herein is no longer a widely recognized benchmark rate for newly originated loans in the U.S. syndicated loan market in the applicable currency or (iii) the applicable supervisor or administrator (if any) of any applicable interest rate specified herein or any Governmental Authority having, or purporting to have, jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which any applicable interest rate specified herein shall no longer be used for determining interest rates for loans in the U.S. syndicated loan market in the applicable currency, then the Administrative Agent may, to the extent practicable (in consultation with the Borrower and as determined by the Administrative Agent to be generally in accordance with similar situations in other transactions in which it is serving as administrative agent or otherwise consistent with market practice generally), establish a replacement interest rate (the " Replacement Rate "), in which case, the Replacement Rate shall, subject to the next two sentences, replace such applicable interest rate for all purposes under the Loan Documents unless and until (A) an event described in Section 3.03(a)(i) , (a)(ii) , (c)(i) , (c)(ii) or (c)(iii) occurs with respect to the Replacement Rate or (B) the Required Lenders (directly, or through the Administrative Agent) notify the Borrower that the Replacement Rate does not adequately and fairly reflect the cost to the Lenders of funding the Loans bearing interest at the Replacement Rate. In connection with the establishment and application of the Replacement Rate, this Agreement and the other Loan Documents shall be amended solely with the consent of the Administrative Agent, as may be necessary or appropriate, in the opinion of the Administrative Agent, to effect the provisions of this Section 3.03(c) .

(d) Replacement Rate . Notwithstanding anything to the contrary in this Agreement or the other Loan Documents, such amendment shall become effective without any further action or consent of any other party to this Agreement so long as the Administrative Agent shall not have received, within five (5) Business Days of the delivery of such amendment to the Lenders, written notices from such Lenders that in the aggregate constitute Required Lenders, with each such notice stating that such Lender objects to such

amendment (which such notice shall note with specificity the particular provisions of the amendment to which such Lender objects). To the extent the Replacement Rate is approved by the Administrative Agent in connection with this clause (c), the Replacement Rate shall be applied in a manner consistent with market practice; provided that, in each case, to the extent such market practice is not administratively feasible for the Administrative Agent, such Replacement Rate shall be applied as otherwise reasonably determined by the Administrative Agent (it being understood that any such modification by the Administrative Agent shall not require the consent of, or consultation with, any of the Lenders).

2.5 Addition of Section 5.23 . Section 5.23 is hereby added to the Credit Agreement to read as follows:

Section 5.23 Anti-Corruption Laws; Anti-Money Laundering Laws and Sanctions.

(a) None of (i) the Borrower, any Subsidiary, any of their respective directors, officers, or, to the knowledge of the Borrower or such Subsidiary, any of their respective employees, or (ii) to the knowledge of the Borrower, any agent or representative of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from this Agreement or the credit facilities extended hereunder, (A) is a Sanctioned Person or currently the subject or target of any Sanctions, (B) is controlled by or is acting on behalf of a Sanctioned Person, (C) has its assets located in a Sanctioned Country, (D) is under administrative, civil or criminal investigation for an alleged violation of, or received notice from or made a voluntary disclosure to any governmental entity regarding a possible violation of, Anti-Corruption Laws, Anti-Money Laundering Laws or Sanctions by a governmental authority that enforces Sanctions or any Anti-Corruption Laws or Anti-Money Laundering Laws, or (E) directly or indirectly derives revenues from investments in, or transactions with, Sanctioned Persons.

(b) Each of the Borrower and its Subsidiaries has implemented and maintains in effect policies and procedures as they deem reasonably appropriate in light of their businesses and international activities designed to ensure compliance by the Borrower and its Subsidiaries and their respective directors, officers, employees and agents with all Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions.

(c) Each of the Borrower and its Subsidiaries, each director, officer, and to the knowledge of Borrower, employee and agent of Borrower and each such Subsidiary, is in compliance with all Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions in all material respects.

(d) No proceeds of any Loan have been used, directly or indirectly, by the Borrower, any of its Subsidiaries or any of its or their respective directors, officers, employees and agents in violation of Section 7.13 .

2.6 Amendment to Section 6.04 . Section 6.04 of the Credit Agreement is hereby amended and restated to read as follows:

Section 6.04. Payment of Obligations. Pay and discharge as the same shall become due and payable, all its material obligations and liabilities, including all material tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Borrower or such Subsidiary.

2.7 Amendment to Section 6.06 . Section 6.06 of the Credit Agreement is hereby amended and restated to read as follows:

Section 6.06. Maintenance of Properties. Except where the failure to do so could not reasonably be expected to have a Material Adverse Effect: (a) maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; (b) make all necessary repairs thereto and renewals and replacements thereof; and (c) use the standard of care typical in the industry in the operation and maintenance of its facilities.

2.8 Amendment to Section 7.01(l) . Section 7.01(l) of the Credit Agreement is hereby amended and restated to replace such subsection (l) and with subsections (l) and (m) which shall read as follows:

(l) the interest of a lessee or transferee of leases, rights or interest pursuant to Section 7.05(h) ; and

(m) other Liens securing obligations not in excess of $7,500,000 at any one time.

2.9 Amendment to Section 7.03(e) . Section 7.03(e) of the Credit Agreement is hereby amended to delete the reference to "$5,000,000" and replace it with a reference to "$7,500,000".

2.10 Amendment to Section 7.03(i) . Section 7.03(i) of the Credit Agreement is hereby amended to delete the reference to "$10,000,000" and replace it with a reference to "$15,000,000".

2.11 Amendment to Section 7.05(f) . Section 7.05(f) of the Credit Agreement is hereby amended to delete the reference to "$5,000,000" and replace it with a reference to "$15,000,000".

2.12 Amendment to Section 7.06 . Section 7.06 of the Credit Agreement is hereby deleted and replaced with the reference "Intentionally Omitted".

2.13 Amendment to Section 7.13 . Section 7.13 of the Credit Agreement is hereby amended to add the following sentence to the end thereof to read as follows:

The Borrower will not request any Loan, and the Borrower shall not use, and shall ensure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Loan, directly or indirectly, (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

2.14 Addition of Section 7.19 . Section 7.19 is hereby added to the Credit Agreement to read as follows:

Section 7.19 Compliance with Anti-Corruption Laws; Beneficial Ownership Regulation, Anti-Money Laundering Laws and Sanctions. The Borrower will (a) maintain in effect and enforce policies and procedures as they deem reasonably appropriate in light of their businesses and international activities, designed to promote and achieve compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with all Anti-Corruption Laws, Anti-Money Laundering Laws and applicable Sanctions and (b) promptly upon the reasonable request of the Administrative Agent, provide the Administrative Agent or such Lender, as the case may be, any information or documentation requested by it for purposes of complying with the Beneficial Ownership Regulation.

2.15 Amendment to Section 8.01(e) . Section 8.01(e) of the Credit Agreement is hereby amended to delete the reference to "$500,000" and replace it with a reference to "$1,500,000".

2.16 Amendment of Section 10.16 . Section 10.16 of the Credit Agreement is hereby amended and restated to read as follows:

Section 10.16 USA Patriot Act; Anti-Money Laundering Laws. The Administrative Agent and each Lender hereby notifies the Borrower that pursuant to the requirements of the PATRIOT Act or any other Anti-Money Laundering Laws, each of them is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of each Credit Party and other information that will allow such Lender to identify each Credit Party in accordance with the PATRIOT Act or such Anti-Money Laundering Laws.

ARTICLE III

Conditions Precedent

3.1 Conditions . The effectiveness of this Amendment is subject to satisfaction of the following conditions precedent:

(a) The Administrative Agent shall have received executed counterparts of this Amendment from each party hereto.

(b) The Administrative Agent shall have received an amendment fee in the amount of $5,000.

(c) The Administrative Agent shall have received, in form and substance satisfactory to the Administrative Agent and its counsel, such other documents, opinions, certificates and instruments as the Administrative Agent shall reasonably require, including any Beneficial Ownership Certifications requested by the Administrative Agent.

ARTICLE IV

Ratifications, Representations and Warranties

4.1 Ratifications . The terms and provisions set forth in this Amendment shall modify and supersede all inconsistent terms and provisions set forth in the Credit Agreement and except as expressly modified and superseded by this Amendment, the terms and provisions of the Credit Agreement are ratified and confirmed and shall continue in full force and effect. The Borrower, the Lenders and the Administrative Agent agree that the Credit Agreement as amended hereby shall continue to be legal, valid, binding and enforceable in accordance with its terms.

4.2 Representations and Warranties . The Borrower hereby represents and warrants to the Administrative Agent and the Lenders that (a) the execution, delivery and performance of this Amendment and any and all other Loan Documents executed and/or delivered in connection herewith have been authorized by all requisite corporate action on the part of the Borrower and will not violate the articles of incorporation or bylaws of the Borrower, (b) the representations and warranties contained in the Credit Agreement, as amended hereby, and any other Loan Document are true and correct in all material respects on and as of the date hereof as though made on and as of the date hereof (excluding, however, representations and warranties that relate to a specific date and were true and correct on such date), (c) no Default or Event of Default has occurred and is continuing, and (d) the Borrower is in full compliance with all covenants and agreements contained in the Credit Agreement as amended hereby.

ARTICLE V

Miscellaneous

5.1 Survival of Representations and Warranties . All representations and warranties made in this Amendment or any other Loan Document including any Loan Document furnished in connection with this Amendment shall survive the execution and delivery of this Amendment and the other Loan Documents, and no investigation by the Administrative Agent or the Lenders or any closing shall affect the representations and warranties or the right of the Administrative Agent and the Lenders to rely upon them.

5.2 Reference to Credit Agreement . Each of the Loan Documents, including the Credit Agreement and any and all other agreements, documents, or instruments now or hereafter executed and delivered pursuant to the terms hereof or pursuant to the terms of the Credit Agreement as amended hereby, are hereby amended so that any reference in such Loan Documents to the Credit Agreement shall mean a reference to the Credit Agreement as amended hereby.

5.3 Severability . Any provision of this Amendment held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Amendment and the effect thereof shall be confined to the provision so held to be invalid or unenforceable.

5.4 Successors and Assigns . This Amendment is binding upon and shall inure to the benefit of each Lender, the Administrative Agent and the Borrower and their respective successors and assigns, except the Borrower may not assign or transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender.

5.5 Effect of Waiver . No consent or waiver, express or implied, by the Administrative Agent or any Lender to or for any breach of or deviation from any covenant, condition or duty by the Borrower shall be deemed a consent or waiver to or of any other breach of the same or any other covenant, condition or duty.

5.6 Headings . The headings, captions, and arrangements used in this Amendment are for convenience only and shall not affect the interpretation of this Amendment.

5.7 Costs, Expenses and Taxes . The Borrower agrees to pay on demand all costs and expenses of the Administrative Agent in connection with the preparation, reproduction, execution and delivery of this Amendment and the other instruments and documents to be delivered hereunder (including the reasonable fees and out-of-pocket expenses of counsel for the Administrative Agent with respect thereto).

5.8 Guarantor's Acknowledgment . By signing below, each Guarantor (a) acknowledges, consents and agrees to the execution, delivery and performance by the Borrower of this Amendment, (b) acknowledges and agrees that its obligations in respect of its Guaranty are not released, diminished, waived, modified, impaired or affected in any manner by this Amendment or any of the provisions contemplated herein, (c) ratifies and confirms its obligations under its Guaranty, and (d) acknowledges and agrees that it has no claims or offsets against, or defenses or counterclaims to, its Guaranty.

5.9 Execution in Counterparts . This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument. For purposes of this Amendment, a counterpart hereof (or signature page thereto) signed and transmitted by any Person party hereto to the Administrative Agent (or its counsel) by facsimile machine, telecopier or electronic mail is to be treated as an original. The signature of such Person thereon, for purposes hereof, is to be considered as an original signature, and the counterpart (or signature page thereto) so transmitted is to be considered to have the same binding effect as an original signature on an original document.

5.10 Governing Law; Binding Effect . This Amendment shall be governed by and construed in accordance with the laws of the State of Texas applicable to agreements made and to be performed entirely within such state, provided that each party shall retain all rights arising under federal law, and shall be binding upon the parties hereto and their respective successors and assigns.

5.11 ENTIRE AGREEMENT . THIS AMENDMENT AND ALL OTHER INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO.

[Remainder of Page Intentionally Left Blank. Signature Pages Follow.]

Executed as of the date first written above.


	BORROWER :

	UNITED STATES LIME & MINERALS, INC.

	By:	\s\ Michael L. Wiedemer
		Michael L. Wiedemer
		Vice President and Chief Financial Officer


	WELLS FARGO BANK, N.A., as Administrative Agent and a Lender

	By:	\s\ Jason Ford
		Jason Ford
		Senior Vice President

ACKNOWLEDGED AND AGREED TO:


	ACT HOLDINGS, INC. ARKANSAS LIME COMPANY COLORADO LIME COMPANY CORSON LIME COMPANY TEXAS LIME COMPANY U.S. LIME COMPANY (formerly named U.S. LIME COMPANY – HOUSTON) U.S. LIME COMPANY – O&G, LLC (formerly named U.S. LIME – O&G COMPANY, LLC) U.S. LIME COMPANY – SHREVEPORT U.S. LIME COMPANY – ST. CLAIR U.S. LIME COMPANY – TRANSPORTATION U.S. LIME – O&G (DELAWARE) LP, LLC U.S. LIME – O&G GP, LLC

	By:	\s\ Michael L. Wiedemer
		Michael L. Wiedemer
		Vice President and Chief Financial Officer


	U.S. LIME – O&G PARTNERS, LP

	By:	U.S. Lime – O&G GP, LLC,
		its general partner


	By:	\s\ Michael L. Wiedemer
		Michael L. Wiedemer
		Vice President and Chief Financial Officer

EXHIBIT 31.1

RULE 13a-14(a)/15d-14(a) CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

I, Timothy W. Byrne, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United States Lime & Minerals, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated: May 3, 2019	/s/ Timothy W. Byrne
	Timothy W. Byrne
	President and Chief Executive Officer

EXHIBIT 31.2

RULE 13a-14(a)/15d-14(a) CERTIFICATION BY THE CHIEF FINANCIAL OFFICER

I, Michael L. Wiedemer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United States Lime & Minerals, Inc.;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Dated: May 3, 2019	/s/ Michael L. Wiedemer
	Michael L. Wiedemer
	Vice President and Chief Financial Officer

EXHIBIT 32.1

SECTION 1350 CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER

I, Timothy W. Byrne, Chief Executive Officer of United States Lime & Minerals, Inc. (the “Company”), hereby certify that, to my knowledge:

(1) The Company’s periodic report on Form 10-Q for the quarterly period ended March 31, 2019 (the “Form 10-Q”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated: May 3, 2019	/s/ Timothy W. Byrne
	Timothy W. Byrne
	President and Chief Executive Officer

EXHIBIT 32.2

SECTION 1350 CERTIFICATION BY THE CHIEF FINANCIAL OFFICER

I, Michael L. Wiedemer, Chief Financial Officer of United States Lime & Minerals, Inc. (the “Company”), hereby certify that, to my knowledge:

(2) The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated: May 3, 2019	/s/ Michael L. Wiedemer
	Michael L. Wiedemer
	Vice President and Chief Financial Officer

EXHIBIT 95.1

MINE SAFETY DISCLOSURES

The following disclosures are provided pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of SEC Regulation S-K, which require certain disclosures by companies required to file periodic reports under the Securities Exchange Act of 1934, as amended, that operate mines regulated under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”).

The Mine Act has been construed as authorizing MSHA to issue citations and orders pursuant to the legal doctrine of strict liability, or liability without fault. If, in the opinion of an MSHA inspector, a condition that violates the Mine Act or regulations promulgated pursuant to it exists, then a citation or order will be issued regardless of whether the operator had any knowledge of, or fault in, the existence of that condition. Many of the Mine Act standards include one or more subjective elements, so that issuance of a citation or order often depends on the opinions or experience of the MSHA inspector involved and the frequency and severity of citations and orders will vary from inspector to inspector.

Whenever MSHA believes that a violation of the Mine Act, any health or safety standard, or any regulation has occurred, it may issue a citation or order which describes the violation and fixes a time within which the operator must abate the violation. In some situations, such as when MSHA believes that conditions pose a hazard to miners, MSHA may issue an order requiring cessation of operations, or removal of miners from the area of the mine, affected by the condition until the hazards are corrected. Whenever MSHA issues a citation or order, it has authority to propose a civil penalty or fine, as a result of the violation, that the operator is ordered to pay.

The table that follows reflects citations, orders, violations and proposed assessments issued to the Company by MSHA during the quarter ended March 31, 2019 and all pending legal actions as of March 31, 2019. Due to timing and other factors, the data may not agree with the mine data retrieval system maintained by MSHA. The proposed assessments for the quarter ended March 31, 2019 were taken from the MSHA system as of May 2, 2019.

Additional information follows about MSHA references used in the table:

Section 104(a) Citations : The total number of citations received from MSHA under section 104(a) of the Mine Act for alleged violations of health or safety standards that could significantly and substantially contribute to a serious injury if left unabated.

Section 104(b) Orders : The total number of orders issued by MSHA under section 104(b) of the Mine Act, which represents a failure to abate a citation under section 104(a) within the period of time prescribed by MSHA. This results in an order of immediate withdrawal from the area of the mine affected by the condition until MSHA determines that the violation has been abated.

Section 104(d) Citations and Orders : The total number of citations and orders issued by MSHA under section 104(d) of the Mine Act for unwarrantable failure to comply with mandatory health or safety standards.

Section 110(b)(2) Violations : The total number of flagrant violations issued by MSHA under section 110(b)(2) of the Mine Act.

Section 107(a) Orders : The total number of orders issued by MSHA under section 107(a) of the Mine Act for situations in which MSHA determined an imminent danger existed.

Citations and orders can be contested before the Federal Mine Safety and Health Review Commission (the “Commission”), and as part of that process, are often reduced in severity and amount, and are sometimes dismissed. The Commission is an independent adjudicative agency that provides administrative trial and appellate review of legal disputes arising under the Mine Act. These cases may involve, among other questions, challenges by operators to citations, orders and penalties they have received from MSHA, or complaints of discrimination by miners under section 105 of the Mine Act.


			Section
			104(d)			Proposed
	Section	Section	Citations	Section	Section	MSHA		Pending
	104 S & S	104(b)	and	110(b)(2)	107(a)	Assessments(2)		Legal
Mine(1)	Citations	Orders	Orders	Violations	Orders	($ in thousands)	Fatalities	Actions(3)
Texas Lime Company	1	—	—	—	—	0.7	—	—
Arkansas Lime Company
Plant	—	—	—	—	—	—	—	—
Limedale Quarry	—	—	—	—	—	0.4	—	—
Colorado Lime Company
Monarch Quarry	—	—	—	—	—	—	—	—
Salida Plant	—	—	—	—	—	—	—	—
Delta Plant	—	—	—	—	—	—	—	—
U.S. Lime Company—St. Clair	1	—	—	—	—	1.2	—	—

(1)

The definition of a mine under section 3 of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting and processing limestone, such as roads, land, structures, facilities, equipment, machines, tools, kilns, and other property. These other items associated with a single mine have been aggregated in the totals for that mine.

(2)

The proposed MSHA assessments issued during the reporting period do not necessarily relate to the citations or orders issued by MSHA during the reporting period or to any pending contests reported above.

(3)

Includes any pending legal actions before the Commission involving such mine as of March 31, 2019. Any pending legal actions were initiated by the Company. The pending legal actions may relate to the citations or orders issued by MSHA during the reporting period or to citations or orders issued in prior periods. Due to timing and other factors, the data may not agree with the mine data retrieval system maintained by MSHA. There was one legal action resolved and none instituted during the reporting period.

Pattern or Potential Pattern of Violations . During the quarter ended March 31, 2019, none of the mines operated by the Company received written notice from MSHA of either (a) a pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to mine health or safety hazards under section 104(e) of the Mine Act or (b) the potential to have such a pattern.