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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549



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Form 10-Q/A



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(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, 2006

OR



| ̈ | 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: N/A



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AMERICAN ROCK SALT COMPANY LLC

(Exact Name of Registrant as Specified in its Charter)



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|                                         |  |                       
|---------------------------------------- |  | ----------------------
|New York                                 |  | 16-1516458            
|(State or Other Jurisdiction of          |  | (IRS Employer         
|Incorporation or Organization)           |  | Identification Number)
|                                         | 
|3846 Retsof Road, Retsof, New York       |  | 14539                 
|(Address of Principal Executive Offices) |  | (Zip Code)            

Registrants Telephone Number, Including Area Code: (585) 243-9510 ext. 1164

(Former Name, Former Address, and Former Fiscal Year, if Changed Since Last Report): N/A



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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 ̈N/A  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated
filer and large accelerated filer in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ̈Accelerated Filer ̈Non-Accelerated
Filer  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).    YES ̈NO  x



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EXPLANATORY NOTES

American Rock Salt Company LLC (the Company) is not required to file reports under the Securities Exchange Act of 1934, as amended. This Form 10-Q/A is only being filed for informational purposes pursuant
to the indenture governing the Companys 91/2% Senior Secured Notes due 2014.

As a result of recent correspondence with the staff of the Securities and Exchange Commission (the SEC), the Company, with the concurrence of the
Companys Board of Managers, concluded in September 2006 to change its method of amortizing its mine development costs from the straight line method to the units-of-production method. This filing reflects, among other things, the retrospective
application of the new method to all periods presented.

This Amendment No. 1 to the Companys Quarterly Report on Form 10-Q/A (this Form
10-Q/A) for the fiscal quarter ended March 31, 2006, initially filed with the SEC on May 11, 2006 (the Original Filing), is being filed to reflect the retrospective application of the Companys new method of
amortizing its mine development costs. This change affects the Companys Balance Sheets at March 31, 2006 and September 30, 2005 and its Statements of Operations, Statements of Changes in Members Equity (Deficit) and Statements
of Cash Flows for each of the fiscal quarters ended March 31, 2006 and March 31, 2005. The Company has elected to change its mine development cost amortization to the units-of-production method, instead of a 20-year amortization life as
the Company had previously used. The Company has adopted Statement of Financial Accounting Standards No. 154 (FAS 154), effective as of October 1, 2005, and in accordance therewith, retrospectively applied the change in
amortization approach as a change in accounting principle to the unaudited financial statements included in this Form 10-Q/A. For a more detailed description of the change in accounting principle, see Note 2, Basis of Presentation and
Accounting Change to the accompanying unaudited financial statements.

For the convenience of the reader, this Form 10-Q/A sets forth the Original
Filing in its entirety, as amended by this Form 10-Q/A. However, this Form 10-Q/A amends only Items 1 and 2 of Part I of the Original Filing, in each case to reflect, and solely as a result of, the revisions referred to above, and, except as noted
above, no other information in the Original Filing is amended hereby. The foregoing items have not been updated to reflect other events occurring after the Original Filing or to modify or update those disclosures affected by subsequent events. In
addition, Item 6 of Part II of this Form 10-Q/A has been amended to include the currently-dated certifications from the Companys Co-Chief Executive Officers and its Chief Financial Officer. The updated certifications are attached to this
Form 10-Q/A as Exhibits 31.1, 31.2, 31.3 and 31.4, respectively. The letter from the Companys independent registered public accounting firm regarding the change in accounting principle is included in the Companys Form 10-Q for the
period ended June 30, 2006, and is incorporated by reference herein.



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American Rock Salt Company LLC

INDEX



|           |  |                                                                                       |  |           
|---------- |  | ------------------------------------------------------------------------------------- |  | ----------
|           |  |                                                                                       |  | PageNumber
|Part 1.    |  | Financial Information                                                                 |  |           
|           |  |                                                                                      
|Item 1.    |  | Financial Statements - Unaudited                                                      |  |           
|           |  |                                                                                      
|           |  | Balance SheetsMarch 31, 2006 and September 30, 2005                                   |  | 2         
|           |  |                                                                                      
|           |  | Statements of OperationsThree and Six Months Ended March 31, 2006 and 2005            |  | 3         
|           |  |                                                                                      
|           |  | Statement of Changes in Members DeficitSix Months Ended March 31, 2006 and 2005      |  | 3         
|           |  |                                                                                      
|           |  | Statements of Cash FlowsSix Months Ended March 31, 2006 and 2005                      |  | 4         
|           |  |                                                                                      
|           |  | Notes to Interim Financial Statements                                                 |  | 5         
|           |  |                                                                                      
|Item 2.    |  | Managements Discussion and Analysis of Financial Condition and Results of Operations |  | 10        
|           |  |                                                                                      
|Item 3.    |  | Quantitative and Qualitative Disclosures About Market Risk                            |  | 15        
|           |  |                                                                                      
|Item 4.    |  | Controls and Procedures                                                               |  | 15        
|           |  |                                                                                      
|Part II.   |  | Other Information                                                                     |  |           
|           |  |                                                                                      
|Item 1.    |  | Legal Proceedings                                                                     |  | 16        
|           |  |                                                                                      
|Item 1A.   |  | Risk Factors                                                                          |  | 16        
|           |  |                                                                                      
|Item 2.    |  | Unregistered Sales of Equity Securities and Use of Proceeds                           |  | 16        
|           |  |                                                                                      
|Item 3.    |  | Defaults upon Senior Securities                                                       |  | 16        
|           |  |                                                                                      
|Item 4.    |  | Submission of Matters to a Vote of Security Holders                                   |  | 16        
|           |  |                                                                                      
|Item 5.    |  | Other Information                                                                     |  | 16        
|           |  |                                                                                      
|Item 6.    |  | Exhibits                                                                              |  | 17        
|           | 
|Signatures |  | 18                                                                                   
|           | 
|Exhibits   |  | 19                                                                                   



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##### Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

American Rock Salt Company LLC

Balance Sheets

(Dollars in Thousands)

(Unaudited)



|                                                                                                                                      |  |                          |         |                   |   |         |  
|------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------ | ------- | ----------------- | - | ------- | -
|                                                                                                                                      |  | March 31,2006            |         | September 30,2005 |  
|                                                                                                                                      |  | As Adjusted (See Note 2) |        
|Assets                                                                                                                                |  |                          |         |                   |   |         |  
|Current assets                                                                                                                        |  |                          |         |                   |   |         |  
|Cash and equivalents                                                                                                                  |  | $                        | 9,068   |                   | $ | 2,234   |  
|Accounts receivable, net of reserve for doubtful accounts of approximately $64 at September 30, 2005 and March 31, 2006,
respectively |  |                          | 7,019   |                   |   | 7,193   |  
|Inventory                                                                                                                             |  |                          | 24,270  |                   |   | 32,040  |  
|Prepaid expenses                                                                                                                      |  |                          | 555     |                   |   | 687     |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Total current assets                                                                                                                  |  |                          | 40,912  |                   |   | 42,154  |  
|Property and equipment, net                                                                                                           |  |                          | 84,797  |                   |   | 84,263  |  
|Other assets                                                                                                                          |  |                          |         |                   |   |         |  
|Salt deposits and mineral rights, net                                                                                                 |  |                          | 2,593   |                   |   | 2,603   |  
|Mine acquisition costs, net                                                                                                           |  |                          | 384     |                   |   | 388     |  
|Financing costs, net of accumulated amortization                                                                                      |  |                          | 6,162   |                   |   | 6,547   |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Total other assets                                                                                                                    |  |                          | 9,139   |                   |   | 9,538   |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|                                                                                                                                      |  | $                        | 134,848 |                   | $ | 135,955 |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Liabilities and Members Equity                                                                                                       |  |                          |         |                   |   |         |  
|Current liabilities                                                                                                                   |  |                          |         |                   |   |         |  
|Revolving line of credit                                                                                                              |  | $                        |        |                   | $ | 13,700  |  
|Current portion of long-term debt                                                                                                     |  |                          | 2,849   |                   |   | 2,849   |  
|Accounts payable                                                                                                                      |  |                          | 2,926   |                   |   | 3,655   |  
|Accrued expenses                                                                                                                      |  |                          | 1,703   |                   |   | 3,621   |  
|Related party payables                                                                                                                |  |                          | 1,069   |                   |   | 361     |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Total current liabilities                                                                                                             |  |                          | 8,547   |                   |   | 24,186  |  
|Long-term debt, net of current portion                                                                                                |  |                          | 121,314 |                   |   | 124,567 |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Total liabilities                                                                                                                     |  |                          | 129,861 |                   |   | 148,753 |  
|                                                                                                                                      |  |                          |         |                   |   |         |  
|Members deficit                                                                                                                      |  |                          |         |                   |   |         |  
|Class A Units 6,250 units issued and outstanding at March 31, 2006 and September 30, 2005                                             |  |                          | 1,638   |                   |   | (4,210  | )
|Class F Units 12,750 units issued and outstanding at March 31, 2006 and September 30, 2005                                            |  |                          | 3,349   |                   |   | (8,588  | )
|                                                                                                                                      |  |                          |         |                   |   |         |  
|                                                                                                                                      |  |                          | 4,987   |                   |   | (12,798 | )
|                                                                                                                                      |  |                          |         |                   |   |         |  
|                                                                                                                                      |  | $                        | 134,848 |                   | $ | 135,955 |  
|                                                                                                                                      |  |                          |         |                   |   |         |  

The accompanying notes are an integral part of these interim financial statements.



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American Rock Salt Company LLC

Statements of Operations

(Dollars in Thousands)

(Unaudited)



|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|------------------------ |  | -------------------------- | ------ | - | ------------------------ | - | ------ | -------------- |  | - | -------------- | - |  | - | ------ | -
|                         |  | For the three months ended |        |   | For the six months ended |  
|                         |  | March 31, 2006             |        |   | March 31, 2005           |   |        | March 31, 2006 |  |   | March 31, 2005 |  
|                         |  | As Adjusted (See Note 2)   |       
|Sales                    |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Bulk                     |  | $                          | 38,463 |   |                          | $ | 63,932 |                |  |   | 82,504         |   |  |   | 90,370 |  
|Packaged                 |  |                            | 262    |   |                          |   | 697    |                |  |   | 1,813          |   |  |   | 1,865  |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Total sales              |  |                            | 38,725 |   |                          |   | 64,629 |                |  |   | 84,317         |   |  |   | 92,235 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Cost of sales            |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Freight and handling     |  |                            | 16,386 |   |                          |   | 28,566 |                |  |   | 37,684         |   |  |   | 40,163 |  
|Products                 |  |                            | 9,362  |   |                          |   | 17,093 |                |  |   | 19,273         |   |  |   | 25,353 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|                         |  |                            | 25,748 |   |                          |   | 45,659 |                |  |   | 56,957         |   |  |   | 65,516 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Gross income             |  |                            | 12,977 |   |                          |   | 18,970 |                |  |   | 27,360         |   |  |   | 26,719 |  
|Operating expenses       |  |                            | 1,625  |   |                          |   | 2,319  |                |  |   | 3,498          |   |  |   | 4,269  |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Income from operations   |  |                            | 11,352 |   |                          |   | 16,651 |                |  |   | 23,862         |   |  |   | 22,450 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Other income (expense)   |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Interest expense         |  |                            | (2,933 | ) |                          |   | (2,986 | )              |  |   | (6,084         | ) |  |   | (5,910 | )
|Interest income          |  |                            | 37     |   |                          |   | 5      |                |  |   | 37             |   |  |   | 5      |  
|Other financing charges  |  |                            | (54    | ) |                          |   | (1     | )              |  |   | (65            | ) |  |   | (7     | )
|Other, net               |  |                            | 2,129  |   |                          |   |       |                |  |   | 2,146          |   |  |   | 3      |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Total other expense, net |  |                            | (821   | ) |                          |   | (2,982 | )              |  |   | (3,966         | ) |  |   | (5,909 | )
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Net income               |  | $                          | 10,531 |   |                          | $ | 13,669 |                |  | $ | 19,896         |   |  | $ | 16,541 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  

The accompanying notes are an integral part of these interim financial statements.

American Rock Salt Company LLC

Statement of Changes in Members (Deficit)

For the Six Months Ended March 31, 2006

(Dollars in Thousands)

(Unaudited)



|                                      |  |                          |        |   |              |   |        |       |  |   |         |  
|------------------------------------- |  | ------------------------ | ------ | - | ------------ | - | ------ | ----- |  | - | ------- | -
|                                      |  | Class AUnits             |        |   | Class FUnits |   |        | Total | 
|                                      |  | As Adjusted (See Note 2) |       
|Members deficit - September 30, 2005 |  | $                        | (4,210 | ) |              | $ | (8,588 | )     |  | $ | (12,798 | )
|Net income                            |  |                          | 6,545  |   |              |   | 13,351 |       |  |   | 19,896  |  
|Distribution to members               |  |                          | (697   | ) |              |   | (1,414 | )     |  |   | (2,111  | )
|                                      |  |                          |        |   |              |   |        |       |  |   |         |  
|Members deficit - March 31, 2006     |  | $                        | 1,638  |   |              | $ | 3,349  |       |  | $ | 4,987   |  
|                                      |  |                          |        |   |              |   |        |       |  |   |         |  

The accompanying notes are an integral part of these interim financial statements.



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American Rock Salt Company LLC

Statements of Cash Flows

(Dollars in Thousands)

(Unaudited)



|                                                                                 |  |                          |         |   |                |   |         |  
|-------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | -------------- | - | ------- | -
|                                                                                 |  | For the six months ended |        
|                                                                                 |  | March 31, 2006           |         |   | March 31, 2005 |  
|                                                                                 |  | As Adjusted (See Note 2) |        
|Cash flows from operating activities                                             |  |                          |         |   |                |   |         |  
|Net income                                                                       |  | $                        | 19,896  |   |                | $ | 16,541  |  
|Adjustments to reconcile net income to net cash provided by operating activities |  |                          |         |   |                |   |         |  
|Depreciation                                                                     |  |                          | 2,417   |   |                |   | 2,159   |  
|Depletion                                                                        |  |                          | 10      |   |                |   | 25      |  
|Provision for bad debts                                                          |  |                          |        |   |                |   | 11      |  
|Amortization of mine acquisition and financing costs                             |  |                          | 389     |   |                |   | 389     |  
|Changes in                                                                       |  |                          |         |   |                |   |         |  
|Accounts receivable                                                              |  |                          | 174     |   |                |   | (13,200 | )
|Inventory                                                                        |  |                          | 7,770   |   |                |   | 16,731  |  
|Prepaid expenses and other assets                                                |  |                          | 132     |   |                |   | (59     | )
|Accounts payable                                                                 |  |                          | (729    | ) |                |   | 666     |  
|Accrued expenses                                                                 |  |                          | (1,918  | ) |                |   | (17     | )
|Borrowings of related party payables                                             |  |                          | 708     |   |                |   | 1,934   |  
|                                                                                 |  |                          |         |   |                |   |         |  
|Net cash provided by (used in) operating activities                              |  |                          | 28,849  |   |                |   | 25,180  |  
|                                                                                 |  |                          |         |   |                |   |         |  
|Cash flows from investing activities                                             |  |                          |         |   |                |   |         |  
|Purchase of property and equipment                                               |  |                          | (2,951  | ) |                |   | (1,151  | )
|                                                                                 |  |                          |         |   |                |   |         |  
|Net cash used in investing activities                                            |  |                          | (2,951  | ) |                |   | (1,151  | )
|                                                                                 |  |                          |         |   |                |   |         |  
|Cash flows from financing activities                                             |  |                          |         |   |                |   |         |  
|Repayments on long-term debt                                                     |  |                          | (3,253  | ) |                |   | (12     | )
|Borrowings on revolving line of credit                                           |  |                          |        |   |                |   | 4,420   |  
|Repayments on revolving line of credit                                           |  |                          | (13,700 | ) |                |   | (17,170 | )
|Issuance of senior secured notes                                                 |  |                          |        |   |                |   |        |  
|Distribution to Members                                                          |  |                          | (2,111  | ) |                |   |        |  
|Increase in Restricted Cash                                                      |  |                          |        |   |                |   | (2,162  | )
|                                                                                 |  |                          |         |   |                |   |         |  
|Net cash used in financing activities                                            |  |                          | (19,064 | ) |                |   | (14,924 | )
|                                                                                 |  |                          |         |   |                |   |         |  
|Net (decrease)increase in cash and equivalents                                   |  |                          | 6,834   |   |                |   | 9,105   |  
|Cash and equivalents - beginning of period                                       |  |                          | 2,234   |   |                |   | 3,102   |  
|                                                                                 |  |                          |         |   |                |   |         |  
|Cash and equivalents - end of period                                             |  | $                        | 9,068   |   |                | $ | 12,207  |  
|                                                                                 |  |                          |         |   |                |   |         |  
|Supplemental Disclosure of Cash Flow Activities                                  |  |                          |         |   |                |   |         |  
|                                                                                 |  | For the six months ended |        
|                                                                                 |  | March 31, 2006           |         |   | March 31, 2005 |  
|Cash paid for interest                                                           |  | $                        | 6,118   |   |                | $ | 5,839   |  
|                                                                                 |  |                          |         |   |                |   |         |  

The accompanying notes are an integral part of these interim financial statements.



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##### Table of Contents

AMERICAN ROCK SALT COMPANY LLC

NOTES TO FINANCIAL STATEMENTS

1. The Company

American Rock Salt Company LLC (the
Company) primarily sells bulk rock salt for use in deicing roads. The Company bids on supply contracts for salt produced at the Hampton Corners Mine to be provided to state Departments of Transportation and local municipalities as well
as industrial consumers throughout the Northeastern United States. The Company was formed on January 30, 1997. Construction of the Hampton Corners Mine began in November 1998 and it was substantially completed in December 2001. The Company
steadily increased sales as production and distribution capacity came online during a ramp-up phase in fiscal 2001 and 2002. The Company attained full operating capacity during fiscal 2003.

2. Basis of Presentation and Accounting Change

The
accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These interim unaudited financial statements should be read in conjunction with the audited financial statements for
the fiscal year ended September 30, 2005 included in the Companys Form 10-K/A . In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation, have been included.
Operating results for the three and six month periods ended March 31, 2006 are not indicative of the results that may be expected for a full year due, in part, to seasonal fluctuations, which are normal for the Companys business. Further,
the Company has made a number of estimates and assumptions relating to the assets and liabilities, the disclosure of contingent assets and liabilities and the reporting of revenues and expenses to prepare these financial statements in conformity
with generally accepted accounting principles. Actual results could differ from those estimates. The balance sheet at September 30, 2005 has been derived from the audited financial statements at that date, but does not include all the
information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

No
provision is made for income taxes in the accompanying financial statements as the Company is a limited liability company that elected partnership status. The taxable income or loss and any available credits of the Company are includable on the
individual income tax returns of the members.

The Company concluded in September 2006 to change its method of amortization of its mine
development costs from the straight line method to the units-of-production method. In accordance with Statement of Financial Accounting Standards (SFAS) No. 154, Accounting Changes and Error Corrections, the Company retrospectively
adjusted its financial statements for all periods to reflect such change.

Mine development costs, primarily underground assets used in the
production of salt, had a gross total of $69.8 million as of March 31, 2006 and are included on the Companys balance sheet in property and equipment, net. Under the prior accounting method, these assets had been amortized over a 20 year
life on a straight line basis. Under the units-of-production method, the assets are amortized based on the tons of salt extracted compared to the total tons of proven salt reserves. The new accounting method is preferable because it better reflects
the usage patterns of these assets, links their estimated useful lives to the life of the Companys proven salt reserves, and is the industry predominant accounting practice for similar assets.

The Company believes it had approximately 8,120 acres of proven salt reserves with approximately 176,000,000 tons of proven salt reserves prior to mining
activity. The financial impact of this accounting change is a reduction of annual amortization expense as the mine development assets are effectively amortized over a longer useful life. Under SFAS 154, the financial statement impact is applied
retrospectively to all periods presented. The following table presents the Companys net income and certain balance sheet data as previously reported using the 20-year amortization life and as adjusted using the units-of-production method.



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##### Table of Contents

|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|---------------------------------------------- |  | ------------------ | ------ | ---------------- | -------------- | - | ----------------- |  | - | -------------- | - |  | - | ------
|                                               |  | Three months ended |        | Six months ended
|                                               |  | March 31, 2006     |        |                  | March 31, 2005 |   | March 31, 2006    |  |   | March 31, 2005
|Net income, as previously reported             |  | $                  | 9,974  |                  |                | $ | 12,497            |  | $ | 18,522         |   |  | $ | 14,894
|Reduced amortization impact                    |  | $                  | 557    |                  |                | $ | 1,172             |  | $ | 1,372          |   |  | $ | 1,647 
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|Net income, as adjusted                        |  | $                  | 10,531 |                  |                | $ | 13,669            |  | $ | 19,894         |   |  | $ | 16,541
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|                                               |  |                    |        |                 
|                                               |  | March 31,2006      |        |                  |                |   | September 30,2005 |  |   |               
|Inventory, as previously reported              |  | $                  | 24,983 |                  |                |   |                   |  | $ | 33,053         |   |  |   |       
|Reduced amortization impact                    |  |                    | (713   | )                |                |   |                   |  |   | (1,013         | ) |  |   |       
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|Inventory, as adjusted                         |  | $                  | 24,270 |                  |                |   |                   |  | $ | 32,040         |   |  |   |       
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|Property and equipment, as previously reported |  | $                  | 74,915 |                  |                |   |                   |  | $ | 75,457         |   |  |   |       
|Reduced amortization impact                    |  |                    | 9,882  |                  |                |   |                   |  |   | 8,806          |   |  |   |       
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       
|Property and equipment, as adjusted            |  | $                  | 84,797 |                  |                |   |                   |  | $ | 84,263         |   |  |   |       
|                                               |  |                    |        |                  |                |   |                   |  |   |                |   |  |   |       



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##### Table of Contents

3. Long-Term Debt

Long-term debt consisted of the following at:



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               |         |   |                   |   |         |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ------- | - | ----------------- | - | ------- | -
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | March 31,2006 |         |   | September 30,2005 |  
|Senior Secured Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |               |         |   |                   |   |         |  
|Senior Secured Notes at March 31, 2006 of $100,000,000, currently requiring semi annual interest payments through the final maturity date
of March 15, 2014 at an annual rate of 9.50%. Prior to March 15, 2007, 35% of the aggregate principal amount of the principal amount of the notes at the established price plus accrued and unpaid interest may be redeemed at 109.5%. Some or
all of the notes may be redeemed at any time prior to March 15, 2009 at a make-whole redemption price. After March 15, 2009, the notes are redeemable at a redemption price of 104.75%, to be adjusted annually to 100% by March 15,
2012 |  |               | 100,000 |   |                   |   | 100,000 |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |              
|Senior Term Loan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               |         |   |                   |   |         |  
|Senior Term Loan at March 31, 2006, currently requiring quarterly principal and interest payments through the final maturity date of
March 16, 2012 at an annual rate equal to the LIBOR rate plus up to 3.5%, based on a pricing grid leverage ratio or a base rate (the higher of the Federal Funds Rate plus 0.5% or the prime rate plus the applicable margin for base rate loans),
at the Companys option. The interest rate is 5.45% as of March 31 , 2006.                                                                                                                                                                 |  |               | 24,027  |   |                   |   | 27,266  |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |              
|Promissory note payable to the Empire State Development Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |               |         |   |                   |   |         |  
|Due April 1, 2011, interest at 4.0% per annum payable in 120 equal installments of principal and interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |               | 136     |   |                   |   | 150     |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               |         |   |                   |   |         |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               | 124,163 |   |                   |   | 127,416 |  
|Less: Current maturities of long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |               | (2,849  | ) |                   |   | (2,849  | )
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               |         |   |                   |   |         |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | $             | 121,314 |   |                   | $ | 124,567 |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |               |         |   |                   |   |         |  

On March 7, 2006, the Company amended its bank facility primarily in order to reduce the
pricing grid leverage ratio and to eliminate certain financial covenants, as previously reported in the Companys Current Report on Form 8-K filed with the Securities and Exchange Commission (the SEC) on March 8, 2006. At
March 31, 2006, the Companys bank facility in the aggregate principal amount of $51.0 million consists of: (a) a $24.0 million term loan facility, and (b) a $27.0 million working capital facility. Both the term loan and the
working capital facility bear interest at an annual rate equal to the LIBOR rate plus up to 1.375%, based on a pricing grid leverage ratio or a base rate (the higher of the Federal Funds Rate plus 0.50% or the prime rate plus the applicable margin
for base rate loans), at the Companys option. The term loan facility has a maturity of eight years commencing March 7, 2006. The working capital facility has an initial term of five years commencing March 7, 2006.

The term loan facility was drawn at the conclusion of litigation with the mine contractor and other parties (see Note 6). At March 31, 2006 a balance
of $24.0 million was outstanding under this facility bearing interest at a rate of 5.45%.

The working capital facility permits the Company
to borrow up to $27.0 million in revolving loans with a $7.0 million sub-limit available for the issuance of letters of credit. Availability of the working capital facility is subject to a borrowing base formula. As of March 31, 2006, the
Company had $0.0 million drawn and $2.0 million of standby letters of credit outstanding under the working capital facility, with approximately $19.1 million of remaining availability thereunder. The aggregate outstanding amount of revolving loans
and letters of credit under the financing arrangement cannot exceed $27.0 million and when outstanding would bear an interest rate of 5.45% (assuming the rate in effect at March 31, 2006 would apply).



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##### Table of Contents

4. Inventory

Inventory consists of the following:



|                     |  |                          |        |   |                    |   |        |  
|-------------------- |  | ------------------------ | ------ | - | ------------------ | - | ------ | -
|                     |  | March 31, 2006           |        |   | September 30, 2005 |  
|                     |  | As Adjusted (See Note 2) |       
|Supplies             |  | $                        | 1,164  |   |                    | $ | 1,056  |  
|Finished Goods, Salt |  |                          | 23,144 |   |                    |   | 31,021 |  
|                     |  |                          |        |   |                    |   |        |  
|                     |  |                          | 24,308 |   |                    |   | 32,077 |  
|Less:                |  |                          |        |   |                    |   |        |  
|Reserve              |  |                          | (38    | ) |                    |   | (37    | )
|                     |  |                          |        |   |                    |   |        |  
|                     |  | $                        | 24,270 |   |                    | $ | 32,040 |  
|                     |  |                          |        |   |                    |   |        |  

5. Related Party Transactions

Legal Services

Certain legal costs were incurred from an organization affiliated with several of our
members of approximately $0.2 million and $0.4 million during the three months ended, and $0.3 million and $0.6 million for the six months ended March 31, 2006 and 2005, respectively. All such fees were included in operating expenses.

Goods and Services

Certain members, or their affiliates, received management and service fees of approximately $0.1 million and $0.1 million during the three months ended, and $0.5 million and $0.1 million for the six months ended March 31, 2006 and
2005, respectively. These amounts are included in operating expenses.

Additionally, certain members, or their affiliates, received payments
for goods and services of approximately $0.5 million and $0.4 million during the three months ended, and $1.0 million and $0.7 million for the six months ended March 31, 2006 and 2005, respectively. Of those amounts, the following amounts were
included in cost of sales - products: for the three months ended March 31, 2006, approximately $0.4 million; for the three months ended March 31, 2005, approximately $0.4 million; for the six months ended March 31, 2006, approximately
$0.9 million; and for the six months ended March 31, 2005, approximately $0.6 million. The remaining amounts not included in cost of sales - products are included in operating expenses.

Financing Costs

Certain costs were
incurred from an affiliate of a member for financial advisory fees of approximately $0.1 million for the three months ended, and $0.1 million for the six months ended March 31, 2005. All such amounts are included in operating expenses. No such
amounts were incurred for the three or six months ended March 31, 2006.

Non-operating Mineral Interests (NOMIs)

Certain members receive payments in respect of NOMIs related to the acquisition of mineral rights equal to 2.5% of the gross income
from the mine as reported for purposes of computing percentage depletion for federal income tax purposes. NOMI expense was approximately $1.3 million and $1.6 million during the three months ended, and $2.2 million and $2.1 million for the six
months ended March 31, 2006 and 2005, respectively. These amounts are included in cost of sales - products.



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6. Commitments and Contingencies

Engineering and Procurement Contract/Litigation

The Company has been involved in litigation with
Frontier-Kemper Constructors, Inc., Flatiron Constructors, Inc. (formerly known as Flatiron Constructors, LLC, and also known as Flatiron Structures LLC), Jointly and Severally with Frontier-Kemper Constructors, Inc. and d/b/a
Frontier-Kemper/Flatiron Joint Venture (together, the EPC Contractor or FKF), whom the Company engaged to design and construct its mine facility, as well as the EPC Contractors bonding companies, Travelers Casualty
and Surety Company of America and Liberty Mutual Insurance Company (the Bonding Companies), and Willis Corroon Corporation of Missouri, Willis Limited, Willis Faber and Dumas (collectively Willis) and Lloyds
U/W at London, Sponsoring Syndicates (Lloyds), the insurance brokers and underwriters, respectively, of certain liquidated damages insurance purchased to insure the timely completion of the mine facility. On June 30, 2005, the
Company, the EPC Contractor and the Bonding Companies reached a settlement agreement with respect to the litigation, pursuant to which the parties agreed to dismiss all claims and counterclaims, subject to limited exceptions, with no findings or
admissions of liability by any party. All of the settled claims were dismissed with prejudice. Other terms of the settlement are confidential by agreement of the parties. The settlement did not include the settling parties claims against
Willis and Lloyds, which claims remained pending. On October 18, 2005, the court in which the remaining litigation against Willis and Lloyds is pending granted summary judgment to the Company on its claims against Willis for breach
of its obligations to the Company as insurance brokers in connection with the above-mentioned liquidated damages insurance. The Company and the EPC Contractor have agreed to a settlement of their claims against Willis and Lloyds and
have negotiated the final terms of the settlement documents. During the quarter ended March 31, 2006, the Company received payment of $2.1 million as final settlement to this litigation. This amount has been included as Other Income in the
Statement of Operations for the three and six month period ended March 31, 2006.



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##### Table of Contents

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

From time to time, the Company or persons acting on behalf of the Company may make oral and written statements that may constitute forward-looking statements
as defined in the Private Securities Litigation Reform Act of 1995 (the PSLRA) or by the Securities and Exchange Commission (SEC) in its rules, regulations, and releases. The Company desires to take advantage of the
safe harbor provisions in the PSLRA for forward-looking statements made from time to time, including, but not limited to, the forward-looking information contained in the Managements Discussion and Analysis of Financial
Condition and Results of Operations section of this Form 10-Q/A and other statements made in this Form 10-Q/A and in filings with the SEC.

The
Company cautions readers that any such forward-looking statements made by or on behalf of the Company are based on managements current expectations and beliefs but are not guarantees of future performance. Actual results could differ
materially from those expressed or implied in the forward-looking statements. The factors that could impact the Company include, without limitation:



| |  | return expectations and related allocation of resources;
|- |  | --------------------------------------------------------



| |  | changing economic or competitive conditions; and
|- |  | ------------------------------------------------



| |  | negotiation of agreements with third parties.
|- |  | ---------------------------------------------

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Company Overview

We are a producer of highway deicing rock salt in North America. We own and operate a rock salt mine located approximately 35 miles south of Rochester,
New York. Our mine is located in the heart of the western and central New York and Pennsylvania snow belt, with on-site access to truck and rail transportation.

Salt mines and mining operations are long-lived assets. Based solely on data extrapolated from areas within a one-mile radius of our drill holes, we believe that our mine currently has over 55 years of remaining mineable reserves at the
current production rate of 3.0 million tons per year.

While winter weather conditions in individual markets can vary from year to year, our target
markets in New York and Pennsylvania are the most impacted by harsh winter snow and ice conditions and overall demand across the region is relatively stable. Our served markets in New York, Pennsylvania, Ohio and eight other states have an aggregate
regional demand for over 9.3 million tons per year of rock salt, and Pennsylvania and New England currently have no operating rock salt mines.

Most
of our sales are based on annual supply contracts with set pricing and reserved volume generally awarded on the basis of lowest price of bids tendered. This allows us to plan our production and staffing schedule and our inventory placement and sales
distribution strategy for the upcoming season. We routinely adjust the size of our workforce, as well as the number of hours and days worked, to reflect seasonal demand.

For the fiscal year ended September 30, 2005 and for the six months ended March 31, 2006, we generated revenues of $104.6 million and $84.3 million, respectively, and net income of $11.0 million and $19.9
million, respectively. We believe that our cash flows are not materially impacted by economic cycles due to the stable end use markets for rock salt and the lack of cost effective alternatives.

Critical Accounting Policies

In preparing financial statements in
conformity with accounting principles generally accepted in the United States of America, or GAAP, we are required to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets
and liabilities at the date of our financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates. We have identified the following as critical accounting policies that are most important
to the portrayal of our financial condition and results of operation.

Salt Deposits, Mineral Rights and Mine Development Costs

Salt deposits and mineral rights are underground reserves with respect to which the Company has extraction rights. Mine Development Costs are primarily underground assets
used in the production of salt with amortization lives linked to the quantity of available production reserves. Depletion of salt deposits and mineral rights and amortization of mine development costs occur as the minerals are extracted based on
units of production and engineering estimates of total reserves. As such, our mineral rights interests include estimates of probable mineral reserves. As such, the carrying values, depletion and amortization expense charges for these assets are
dependent upon estimates of proven mineral reserves. The impact of revisions to our reserve estimates is recognized on a prospective basis.



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##### Table of Contents

Mine Reclamation Cost

We have calculated the estimated net future cost of dismantling, restoring, and reclaiming our mine in its related mine site in accordance with federal, state and local regulatory requirements, and in accordance with Statement of Financial
Accounting Standards (SFAS) No. 143, Accounting for Obligations Associated with the Retirement of Long-Lived Assets. SFAS No. 143 requires that we recognize the legal obligation of our mine reclamation costs at fair value as a
liability when incurred and capitalize such costs by increasing the carrying amount of our mine assets.

Impairment of Long-Lived Assets

In the event that relevant facts and circumstances indicate that the carrying amounts of our long-lived assets may be impaired, an evaluation of recoverability is
performed. If such an evaluation is required, the estimated future undiscounted cash flows associated with the asset would be compared to the assets carrying amount to determine if a write-down is required. If our review indicates that the
assets will not be recoverable, the carrying value of the Companys assets would be reduced to their estimated fair value.

Other Significant
Accounting Policies

Other significant accounting policies not involving the same level of estimates and assumptions as those discussed above are
important to an understanding of our financial statements. For example, our policies related to our inventory allowances, revenue recognition and legal contingencies require judgments and estimates.

Results of Operations

The following table sets forth certain
historical financial information for the three and six months ended March 31, 2006 and 2005 which have been adjusted as discussed in Note 2 to our unaudited financial statements included elsewhere in this Form 10-Q/A. We record sales to
customers based upon total billings including shipping and handling costs necessary to transport our products from the production or storage sites to the delivery point. In establishing our prices to our customers, we must take into account the
estimated cost of transportation of our products, since we assume responsibility for such costs. We manage the profitability and attractiveness of existing and prospective customers and product lines by analyzing, among other factors, the customer
billings net of related shipping and handling costs. This allows for a more comparable look at the relative profitability of our business as well as providing a more accurate analysis upon which to analyze trends in the business.

The following table and discussion should be read in conjunction with the information contained in our financial statements and the notes thereto included elsewhere in
this Form 10-Q/A.



|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|------------------------ |  | -------------------------- | ------ | - | ------------------------ | - | ------ | -------------- |  | - | -------------- | - |  | - | ------ | -
|                         |  | For the three months ended |        |   | For the six months ended |  
|                         |  | March 31, 2006             |        |   | March 31, 2005           |   |        | March 31, 2006 |  |   | March 31, 2005 |  
|                         |  | As Adjusted (See Note 2)   |       
|Sales                    |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Bulk                     |  | $                          | 38,463 |   |                          | $ | 63,932 |                |  |   | 82,504         |   |  |   | 90,370 |  
|Packaged                 |  |                            | 262    |   |                          |   | 697    |                |  |   | 1,813          |   |  |   | 1,865  |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Total sales              |  |                            | 38,725 |   |                          |   | 64,629 |                |  |   | 84,317         |   |  |   | 92,235 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Cost of sales            |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Freight and handling     |  |                            | 16,386 |   |                          |   | 28,566 |                |  |   | 37,684         |   |  |   | 40,163 |  
|Products                 |  |                            | 9,362  |   |                          |   | 17,093 |                |  |   | 19,273         |   |  |   | 25,353 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|                         |  |                            | 25,748 |   |                          |   | 45,659 |                |  |   | 56,957         |   |  |   | 65,516 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Gross income             |  |                            | 12,977 |   |                          |   | 18,970 |                |  |   | 27,360         |   |  |   | 26,719 |  
|Operating expenses       |  |                            | 1,625  |   |                          |   | 2,319  |                |  |   | 3,498          |   |  |   | 4,269  |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Income from operations   |  |                            | 11,352 |   |                          |   | 16,651 |                |  |   | 23,862         |   |  |   | 22,450 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Other income (expense)   |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Interest expense         |  |                            | (2,933 | ) |                          |   | (2,986 | )              |  |   | (6,084         | ) |  |   | (5,910 | )
|Interest income          |  |                            | 37     |   |                          |   | 5      |                |  |   | 37             |   |  |   | 5      |  
|Other financing charges  |  |                            | (54    | ) |                          |   | (1     | )              |  |   | (65            | ) |  |   | (7     | )
|Other, net               |  |                            | 2,129  |   |                          |   |       |                |  |   | 2,146          |   |  |   | 3      |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Total other expense, net |  |                            | (821   | ) |                          |   | (2,982 | )              |  |   | (3,966         | ) |  |   | (5,909 | )
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  
|Net income               |  | $                          | 10,531 |   |                          | $ | 13,669 |                |  | $ | 19,896         |   |  | $ | 16,541 |  
|                         |  |                            |        |   |                          |   |        |                |  |   |                |   |  |   |        |  

The accompanying notes are an integral part of these interim financial statements.

Seasonality

We experience a substantial amount of seasonality in
salt sales. Sales of highway and consumer deicing salt products are seasonal as they vary based on the severity of the winter conditions in areas where the product is used. Following industry



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##### Table of Contents

practice, we and our customers stockpile significant quantities of deicing salt in the second, third and fourth calendar quarters. The result of this
seasonality is that sales and operating income are generally higher in the first and fourth calendar quarters and lower during the second and third calendar quarters of each calendar year, resulting in large increases in accounts receivable and
accrued expenses on the balance sheet as of March 31 of each year compared to September 30 of each year. For the quarter ended March 31, 2006, accounts receivable and accrued expenses did not follow historical seasonality patterns as
a result of the unusually warm and dry winter weather during that period. Our results of operations for the fiscal year ended September 30 are more representative of trends in our results.

Three Months Ended March 31, 2006 Compared to Three Months Ended March 31, 2005

Sales

Total sales for the quarter ended March 31, 2006 of $38.7 million decreased $25.9 million, or 40.1%,
compared to $64.6 million during the same period in fiscal 2005. Sales primarily consist of bulk salt sales, as well as packaged salt sales. The $25.9 million decrease is primarily attributed to a 43.8% decrease in sales volume offset by a 6.6%
increase in sales prices in the second quarter of fiscal 2006 as compared to the second quarter of fiscal 2005. This decrease in sales volume is the direct result of current seasonal weather patterns which resulted in winter weather being milder and
drier than it had in the quarter ended March 31, 2005. This quarter comparison is further distorted by the better than normal winter weather patterns experienced for the quarter ended March 31, 2005. For this reason, the six month results
provided in this Form 10-Q/A are a better illustration of the 2005 and 2006 winter seasons.

Gross Income

Gross income of $13.0 million for the second quarter of fiscal 2006 decreased by $6.0 million, or 31.6%, compared to $19.0 million for the same period in fiscal 2005. The
decrease in gross income was primarily attributable to the 43.8% decrease in tonnage sold as discussed above under Sales, offset by the 6.6% price increase referred to above. Cost of sales on a per ton basis was comparable between
quarters.

Components of cost of sales changed as follows:



| |  |  | Cost of sales - freight and handling for the three months ended March 31, 2006 decreased by $12.2 million or 42.6% as a result of an overall decrease in tonnage sold offset by
an overall increase in freight costs.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Cost of sales - products for the three months ended March 31, 2006 decreased by $7.7 million or 45.2% corresponding to the overall decrease in tons sold including a 2.5%
reduction in the cost per ton of products sold demonstrating the favorable impact of controlling costs of production as sales volume declined.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Operating Expenses

Operating expenses of $1.6 million for the second quarter of fiscal 2006 decreased by $0.7 million, or 29.9%, as
compared to $2.3 million for the same period in fiscal 2005. Operating expenses primarily consist of selling, general and administrative expenses, miscellaneous overhead and non-production related depreciation and amortization expenses. The $0.7
million decrease in operating expenses was primarily attributable to a decrease in legal and consulting fees as a result of the settlement of the litigation with the EPC Contractor, as discussed in Note 6 to our unaudited financial statements
included elsewhere in this Form 10-Q/A.

Other Income (Expense)

Other expense of $0.8 million for the second quarter of fiscal 2006 decreased $2.2 million, or 72.5%, as compared to $3.0 million for the same period in fiscal 2005. Other expense consists primarily of interest expense of $2.9 million on
our credit facility and other related financing charges, which decreased by $0.1 million, or 2.9%, offset by the $2.1 million received in connection with the settlement of the litigation with the EPC Contractor, as discussed in Note 6 to our
unaudited financial statements included elswhere in this Form 10-Q/A.

Six Months Ended March 31, 2006 Compared to Six Months Ended March 31,
2005

Sales

Total sales for the six months ended
March 31, 2006 of $84.3 million decreased $7.9 million, or 8.6%, as compared to $92.2 million during the same period in fiscal 2005. Sales primarily consist of bulk salt sales, as well as packaged salt sales. The $7.9 million decrease was
attributable primarily to a 16.5% decrease in tonnage sold offset by a 9.5% increase in sales price per ton. The decrease in tonnage sold was due to milder and drier winter weather conditions in the six months ended March 31, 2006, as compared
to the same six month period in 2005.

Gross Income

Gross income for the six months ended March 31, 2006 of $27.4 million increased by $0.6 million, or 2.4%, compared to $26.7 million for the same period in fiscal 2005. The increase in gross income was attributable to the increase in
sales price per ton as well as the 9.6% per ton reduction in cost of sales products referred to below. The reduction in production costs more than offset the increased fuel costs adversely affecting many companies.



12



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##### Table of Contents

Components of cost of sales changed as follows:



| |  |  | Cost of sales - freight and handling for the six months ended March 31, 2006 decreased by $2.5 million or 6.2%. This includes a 12.5% increase in cost per ton due to increased
fuel prices, offset by a 14.8% decrease in tons shipped.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Cost of sales - products for the six months ended March 31, 2006 decreased $6.1 million or 24.0%. The decrease is primarily attributable to the 16.5% decrease in tons sold
offset by an overall reduction of 9.6% per ton in cost of sales-products as a result of managing production costs as sales volumes declined.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Operating Expenses

Operating expenses of $3.5 million for the six months ended March 31, 2006 decreased $0.8 million, or 18.1%, as
compared to $4.3 million for the same period in fiscal 2005. Operating expenses primarily consist of selling, general and administrative expenses, miscellaneous overhead and non-production related depreciation and amortization expenses. The decrease
in operating expenses for the six months ended March 31, 2006 is primarily attributable to a decrease in legal and consulting fees as a result of the settlement of the litigation with the EPC Contractor, as discussed in Note 6 to our unaudited
financial statements included elsewhere in this Form 10-Q/A.

Other Income (Expense)

Other expense of $4.0 million for the first six months of fiscal 2006 decreased $1.9 million, or 32.9%, as compared to $5.9 million for the same period in fiscal 2005. Other expense consists primarily of interest
expense of $6.0 million on our credit facility and other related financing charges, which increased by $0.1 million, or 2.4%, offset by the $2.1 million received in connection with the settlement of the litigation with the EPC Contractor, as
discussed in Note 6 to our unaudited financial statements included elsewhere in this Form 10-Q/A.

Liquidity and Capital Resources

Historical Cash Flow

We have used the cash generated from operations,
borrowings under revolving lines of credit, and borrowings under construction and post-construction financing facilities to meet our working capital needs and to fund capital expenditures. Additional information regarding our cash flows for the six
month period ended March 31, 2006 is provided below.

Operating Activities - Net cash provided by operating activities was $28.8 million
for the first six months of fiscal 2006 compared to $25.2 million in net cash provided during the same period in fiscal 2005. Net cash provided by operating activities during the six months ended March 31, 2006 increased primarily due to a $3.4
million increase in net income; a $0.2 million decrease in receivables due to the lower sales volume as compared to a $13.2 million increase during the six months ended March 31, 2005; and an $7.8 million decrease in inventory for the six
months ended March 31, 2006 as compared to a $16.7 million decrease during the six months ended March 31, 2005. Net working capital increased $6.1 million during the first six months of fiscal 2006 as compared to a $6.1 million increase
during the first six months of 2005.

Investing Activities - Net cash flow used in investing activities for the first six months of fiscal
2006 and 2005 was $2.9 million and $1.2 million, respectively. These cash flows primarily consisted of maintenance-related capital expenditures of $2.9 million and $1.2 million during the six months ended March 31, 2006 and 2005, respectively.

Financing Activities -Net cash used in financing activities was $19.1 million for the first six months of fiscal 2006 as compared to $14.9
million used during the same period in fiscal 2005. During the six months ended March 31, 2006, $12.7 million of cash was provided via seasonal borrowing under our revolving line of credit, offset by $15.7 million in repayments under our
revolving line of credit and $3.2 million in principal payments under our term loan facility. Sinking fund and excess cash flow payments made between October 1, 2004 and March 31, 2005 under the credit facility totaled $2.2 million and
were shown on the balance sheet as restricted cash. As a result of the settlement of the EPC Contractor litigation, the sinking fund balance was applied against the term loan under our credit facility. In light of the litigation settlement in June
2005, there is no longer a requirement for a sinking fund payment under our credit facility.

EBITDA

EBITDA represents net income before interest expense, depreciation, depletion, and amortization (the Company does not incur income taxes). EBITDA does not represent and
should not be considered as an alternative to net income or cash flow from operations, as determined by GAAP, and our calculations of EBITDA may not be comparable to those reported by other companies. Investors should carefully consider the specific
items included in our computation of EBITDA. EBITDA is included herein because it is a basis upon which we assess our liquidity position and performance and because certain covenants in our borrowing arrangements are tied to similar measures. EBITDA
is also included herein because we believe that it presents useful information to investors regarding a companys ability to service and/or incur indebtedness. This belief is based on negotiations with lenders who have indicated that the amount
of indebtedness we will be permitted to incur will be based, in part, on measures similar to our EBITDA. EBITDA does not take into account working capital requirements, capital expenditures, debt service requirements and other commitments, and
accordingly, EBITDA is not necessarily indicative of amounts that may be available for discretionary use.



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The following table reconciles EBITDA to net income and net cash provided (used in) by operating activities, the most
directly comparable GAAP financial measures, for the periods indicated (dollars in thousands):

American Rock Salt Company LLC

EBITDA Reconciliation to Net Income



|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|----------------------------------------------------------- |  | ---------------------------- | ------- | - | -------------------------- | - | ------ | ---- |  | - | ------- | - |  | - | ------- | -
|                                                            |  | Three Months Ended March 31, |         |   | Six Months Ended March 31, |  
|                                                            |  | 2006                         |         |   | 2005                       |   |        | 2006 |  |   | 2005    |  
|                                                            |  | As Adjusted (See Note 2)     |        
|Net Income to Members                                       |  | $                            | 10,531  |   |                            | $ | 13,669 |      |  | $ | 19,896  |   |  | $ | 16,541  |  
|Interest Expense                                            |  |                              | 2,933   |   |                            |   | 2,986  |      |  |   | 6,084   |   |  |   | 5,910   |  
|Depletion, Depreciation and Amortization                    |  |                              | 1,423   |   |                            |   | 1,292  |      |  |   | 2,816   |   |  |   | 2,573   |  
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|EBITDA                                                      |  |                              | 14,887  |   |                            |   | 17,947 |      |  | $ | 28,796  |   |  | $ | 25,024  |  
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|Add/Subtract                                                |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|Interest Expense                                            |  |                              | (2,933  | ) |                            |   | (2,986 | )    |  |   | (6,084  | ) |  |   | (5,910  | )
|Changes in working capital and other assets and liabilities |  |                              | 12,541  |   |                            |   | 13,413 |      |  |   | 6,137   |   |  |   | 6,066   |  
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|Net cash provided by (used in) operating activities         |  |                              | 24,495  |   |                            |   | 28,374 |      |  | $ | 28,849  |   |  | $ | 25,180  |  
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|Net cash used in investing activities                       |  | $                            | (401    | ) |                            | $ | (148   | )    |  | $ | (2,951  | ) |  | $ | (1,151  | )
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  
|Net cash provided by financing activities                   |  | $                            | (20,366 | ) |                            | $ | 2,336  |      |  | $ | (19,064 | ) |  | $ | (14,924 | )
|                                                            |  |                              |         |   |                            |   |        |      |  |   |         |   |  |   |         |  



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##### Table of Contents

Contractual Cash Obligations

There have been no material changes outside the ordinary course of the Companys business to the Companys contractual cash obligations as reported in its Annual Report on Form 10-K for the fiscal year ended September 30,
2005.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Companys business is subject to a variety of
market risks, including but not limited to, interest rate risks and commodity pricing risks. Although the Companys senior secured notes bear interest at a fixed rate of 9.5% per annum, borrowings under its bank facility are subject to
variable interest rates keyed to LIBOR. As of March 31, 2006 the variable rate was 7.5%. As of March 31, 2006, we had $100.0 million of debt outstanding under our senior secured notes, and $24.0 million outstanding under our bank facility.
Our bank facility, in the aggregate principal amount of $51.0 million, consists of (a) a $24.0 million term loan facility, and (b) a $27.0 million working capital facility. The working capital facility permits us to borrow up to $27.0
million in revolving loans with a sub-limit available for the issuance of letters of credit. As of March 31, 2006, there was $0.0 million drawn and $2.0 million of standby letters of credit outstanding under the working capital facility with
approximately $19.1 million of remaining availability thereunder.

Our earnings and cash flows are affected by changes in interest rates applicable to our
bank facility. Given our current debt structure and assuming an average level of borrowings from our revolving credit facility at variable rates and a one hundred basis point increase in the average interest rate under these borrowings, it is
estimated that our interest expense for the quarter ended March 31, 2006 would have increased by approximately $0.3 million.

ITEM 4. CONTROLS AND PROCEDURES

The Companys management, with the participation of its Co-Principal Executive
Officers and Principal Financial Officer, evaluated the effectiveness of the design and operation of the Companys disclosure controls and procedures (as defined in Rule 15d-15(e) of the Securities Exchange Act of 1934, as amended (the
Exchange Act)). Based on that evaluation, the Companys Co-Principal Executive Officers and its Principal Financial Officer concluded that the Companys disclosure controls and procedures as of March 31, 2006 (the end of
the period covered by this report) have been designed and are functioning effectively to provide reasonable assurance that the information required to be disclosed by the Company in reports filed or submitted under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the SECs rules and forms.

There were no changes to the Companys
internal control over financial reporting that occurred during the three months ended March 31, 2006 that materially affected or are reasonably likely to materially affect the Companys internal control over financial reporting.



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##### Table of Contents

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company has been involved in litigation with Frontier-Kemper Constructors, Inc., Flatiron
Constructors, Inc. (formerly known as Flatiron Constructors, LLC, and also known as Flatiron Structures LLC), Jointly and Severally with Frontier-Kemper Constructors, Inc. and d/b/a Frontier-Kemper/Flatiron Joint Venture (together, the EPC
Contractor or FKF), whom the Company engaged to design and construct its mine facility, as well as the EPC Contractors bonding companies, Travelers Casualty and Surety Company of America and Liberty Mutual Insurance
Company (the Bonding Companies), and Willis Corroon Corporation of Missouri, Willis Limited, Willis Faber and Dumas (collectively Willis) and Lloyds U/W at London, Sponsoring Syndicates (Lloyds),
the insurance brokers and underwriters, respectively, of certain liquidated damages insurance purchased to insure the timely completion of the mine facility. On June 30, 2005, the Company, the EPC Contractor and the Bonding Companies reached a
settlement agreement with respect to the litigation, pursuant to which the parties agreed to dismiss all claims and counterclaims, subject to limited exceptions, with no findings or admissions of liability by any party. All of the settled claims
were dismissed with prejudice. Other terms of the settlement are confidential by agreement of the parties. The settlement did not include the settling parties claims against Willis and Lloyds, which claims remained pending. On
October 18, 2005, the court in which the remaining litigation against Willis and Lloyds is pending granted summary judgment to the Company on its claims against Willis for breach of its obligations to the Company as insurance brokers in
connection with the above-mentioned liquidated damages insurance. The Company and the EPC Contractor have agreed to a settlement of their claims against Willis and Lloyds and negotiated the final terms of the settlement documents.
During the quarter ended March 31, 2006, the Company received payment of $2.1 million as final settlement to this litigation. This amount has been included as Other Income in the Statement of Operations for the three and six month period ended
March 31, 2006.

In addition, the Company is involved in various routine legal proceedings from time to time. These typically involve commercial
claims, personal injury claims, and workers compensation claims. While the Company cannot predict the outcome of such proceedings, it does not believe that these proceedings will have a material adverse effect on its business.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors that the Company disclosed in its Annual
Report on Form 10-K for the fiscal year ended September 30, 2005.

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

Nothing to report.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Nothing to report.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Nothing to report.

ITEM 5. OTHER INFORMATION

Nothing to report.



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##### Table of Contents

ITEM 6. EXHIBITS

The following exhibits are filed as part of this report on Form 10-Q/A:



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                     
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                              
|            | 
|10.1        |  | Amended and Restated Credit Agreement by and among American Rock Salt Company, LLC, the financial institutions from time to time party thereto, and Manufacturers and Traders Trust Company as
arranger, as agent, as collateral agent and as issuer of certain letters of credit pursuant thereto (filed as Exhibit 10.1 to the Companys Current Report on Form 8-K filed on March 8, 2006, and incorporated by reference
herein).
|            | 
|18.1        |  | Letter from Independent Registered Public Accounting Firm re Change in Accounting Principle (filed as Exhibit 18.1 to the Companys Quarterly Report on Form 10-Q for the quarter ended
June 30, 2006 and incorporated by reference herein)                                                                                                                                                                                         
|            | 
|31.1        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.2        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.3        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.4        |  | Certificate of the Chief Financial Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                             



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##### Table of Contents

SIGNATURES

The registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

October 24, 2006



AMERICAN ROCK SALT COMPANY LLCBy:

/s/ Raymond R. MartelRaymond R. Martel,Chief Financial Officer(Principal Financial Officer)




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##### Table of Contents

EXHIBIT INDEX



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                     
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                              
|            | 
|10.1        |  | Amended and Restated Credit Agreement by and among American Rock Salt Company, LLC, the financial institutions from time to time party thereto, and Manufacturers and Traders Trust Company as
arranger, as agent, as collateral agent and as issuer of certain letters of credit pursuant thereto (filed as Exhibit 10.1 to the Companys Current Report on Form 8-K filed on March 8, 2006, and incorporated by reference
herein).
|            | 
|18.1        |  | Letter from Independent Registered Public Accounting Firm re Change in Accounting Principle (filed as Exhibit 18.1 to the Companys Quarterly Report on Form 10-Q for the quarter ended
June 30, 2006 and incorporated by reference herein)                                                                                                                                                                                         
|            | 
|31.1        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.2        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.3        |  | Certificate of the Co-Chief Executive Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                          
|            | 
|31.4        |  | Certificate of the Chief Financial Officer pursuant to 18 U.S.C. §1350 (Section 302 of the Sarbanes-Oxley Act of 2002) (filed herewith)                                                                                                                                                                                                                                                                                             



19