Unassociated Document
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
___________
FORM
10-QSB
x QUARTERLY
REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
For
the
quarterly period ended July 31, 2006
o TRANSITION
REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT
For
the
transition period from _____________ to _____________
Commission
file number: 000-27667
Metalline
Mining Company
(Exact
name of small business issuer as specified in its charter)
Nevada
|
91-1766677
|
(State
or other jurisdiction
|
(IRS
Employer Identification No.)
|
of
incorporation or organization)
|
|
1330
E.
Margaret Ave.
Coeur
d'Alene, ID 83815
(Address
of principal executive offices)
Issuer's
telephone number, including area code: (208) 665-2002
Check
whether the issuer (1) filed all reports required to be filed by Section 13
or
15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for
such shorter period that the registrant was required to file such reports),
and
(2) has been subject to such filing requirements for the past 90 days.
Yes x No o
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes o No
x
There
were 34,126,661 shares of the issuer's common stock, par value $0.01,
outstanding as of August 1, 2006.
Transitional
Small Business Disclosure Format (Check one): Yes oNo x
METALLINE
MINING COMPANY
QUARTERLY
REPORTON FORM 10-QSB
FOR
THE QUARTERLY PERIOD ENDED JULY 31, 2006
INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS
PAGE
Consolidated
Financial Statements:
Consolidated
Balance Sheets as of July 31, 2006
|
2
|
|
|
Consolidated
Statements of Operations for the three-month and
nine-month
|
|
periods
ended July 31, 2006 and
|
|
July
31, 2005 and for the period from inception
|
|
(November
8, 1993) to July 31, 2006
|
3
|
|
|
Consolidated
Statements of Cash Flow for the nine-month
|
|
periods
ended July 31, 2006 and July 31, 2005, and
|
|
for
the period from inception (November 8, 1993)
|
|
to
July 31, 2006
|
4
|
|
|
Condensed
Notes to Consolidated Financial Statements
|
5
|
[The
balance of this page has been intentionally left blank.]
METALLINE
MINING COMPANY
|
(AN
EXPLORATION STAGE COMPANY)
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
July
31,
|
|
|
|
|
|
2006
|
|
October
31,
|
|
|
|
(unaudited)
|
|
2005
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
8,432,472
|
|
$
|
213,369
|
|
Accounts
receivable
|
|
|
35,720
|
|
|
23,620
|
|
Prepaid
expenses
|
|
|
31,301
|
|
|
13,242
|
|
Employee
advances
|
|
|
1,142
|
|
|
9,560
|
|
Total
Current Assets
|
|
|
8,500,635
|
|
|
259,791
|
|
|
|
|
|
|
|
|
|
PROPERTY
CONCESSIONS
|
|
|
|
|
|
|
|
Sierra
Mojada, Mojada 3
|
|
|
15,875
|
|
|
15,875
|
|
Fortuna
|
|
|
76,725
|
|
|
76,725
|
|
Esmeralda
|
|
|
255,647
|
|
|
255,647
|
|
Esmeralda
I
|
|
|
180,988
|
|
|
180,988
|
|
U.M.
Nortenos, Vulcano
|
|
|
3,682,772
|
|
|
3,682,772
|
|
La
Blanca
|
|
|
122,760
|
|
|
122,760
|
|
Total
Property Concessions
|
|
|
4,334,767
|
|
|
4,334,767
|
|
|
|
|
|
|
|
|
|
EQUIPMENT
|
|
|
|
|
|
|
|
Office
and mining equipment, net
|
|
|
483,817
|
|
|
490,884
|
|
Total
Equipment
|
|
|
483,817
|
|
|
490,884
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
13,319,219
|
|
$
|
5,085,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
82,507
|
|
$
|
86,189
|
|
Accrued
liabilities and expenses
|
|
|
50,302
|
|
|
189,046
|
|
Other
liabilities
|
|
|
28,744
|
|
|
15,873
|
|
Note
payable, current portion
|
|
|
4,209
|
|
|
4,209
|
|
Total
Current Liabilities
|
|
|
165,762
|
|
|
295,317
|
|
|
|
|
|
|
|
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
|
|
Note
payable, net of current portion
|
|
|
4,208
|
|
|
7,365
|
|
|
|
|
|
|
|
|
|
COMMITMENTS
AND CONTINGENCIES
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
Common
stock, $0.01 par value; 50,000,000 shares authorized,
|
|
|
|
|
|
|
|
34,126,661
and 20,404,585 shares issued and outstanding,
respectively
|
|
|
341,267
|
|
|
204,047
|
|
Additional
paid-in capital
|
|
|
27,256,925
|
|
|
19,852,673
|
|
Stock
options and warrants
|
|
|
5,265,069
|
|
|
1,347,839
|
|
Deficit
accumulated during exploration stage
|
|
|
(19,714,012
|
)
|
|
(16,621,799
|
)
|
Total
Stockholders' Equity
|
|
|
13,149,249
|
|
|
4,782,760
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
$
|
13,319,219
|
|
$
|
5,085,442
|
|
METALLINE
MINING COMPANY
|
(AN
EXPLORATION STAGE COMPANY)
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
November
8,
|
|
|
|
|
|
|
|
|
|
|
|
1993
|
|
|
|
|
|
|
|
|
|
|
|
(Inception)
|
|
|
|
Three
Months Ended
|
|
Nine
Months Ended
|
|
to
|
|
|
|
July
31,
|
|
July
31,
|
|
July
31,
|
|
July
31,
|
|
July
31,
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
2006
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GENERAL
AND ADMINISTRATIVE EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries
and payroll expenses
|
|
|
127,295
|
|
|
109,929
|
|
|
965,409
|
|
|
682,925
|
|
|
4,203,026
|
|
Office
and administrative expenses
|
|
|
93,193
|
|
|
70,985
|
|
|
258,676
|
|
|
247,568
|
|
|
1,247,622
|
|
Taxes
and fees
|
|
|
127,428
|
|
|
969
|
|
|
301,106
|
|
|
47,996
|
|
|
790,547
|
|
Professional
services
|
|
|
219,191
|
|
|
141,585
|
|
|
831,080
|
|
|
765,724
|
|
|
5,198,782
|
|
Property
expenses
|
|
|
12,370
|
|
|
44,281
|
|
|
157,797
|
|
|
115,816
|
|
|
2,101,900
|
|
Depreciation
|
|
|
26,060
|
|
|
20,630
|
|
|
67,503
|
|
|
62,927
|
|
|
409,363
|
|
Exploration
and research
|
|
|
599,787
|
|
|
83,093
|
|
|
671,649
|
|
|
819,614
|
|
|
6,005,735
|
|
TOTAL
GENERAL AND ADMINISTRATIVE EXPENSES
|
|
|
1,205,324
|
|
|
471,472
|
|
|
3,253,220
|
|
|
2,742,570
|
|
|
19,956,974
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOSS
FROM OPERATIONS
|
|
|
(1,205,324
|
)
|
|
(471,472
|
)
|
|
(3,253,220
|
)
|
|
(2,742,570
|
)
|
|
(19,956,974
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME (EXPENSES)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous
ore sales, net of expenses
|
|
|
10,426
|
|
|
(13,710
|
)
|
|
(31,111
|
)
|
|
(12,351
|
)
|
|
134,027
|
|
VAT
tax refunds
|
|
|
-
|
|
|
-
|
|
|
13,045
|
|
|
-
|
|
|
132,660
|
|
Miscellaneous
income
|
|
|
24,000
|
|
|
10,000
|
|
|
85,500
|
|
|
10,000
|
|
|
94,000
|
|
Interest
and investment income
|
|
|
81,197
|
|
|
3,249
|
|
|
95,631
|
|
|
29,542
|
|
|
171,104
|
|
Interest
and financing expense
|
|
|
(1,203
|
)
|
|
(152
|
)
|
|
(2,058
|
)
|
|
(455
|
)
|
|
(288,829
|
)
|
TOTAL
OTHER INCOME
|
|
|
114,420
|
|
|
(613
|
)
|
|
161,007
|
|
|
26,736
|
|
|
242,962
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LOSS
BEFORE INCOME TAXES
|
|
|
(1,090,904
|
)
|
|
(472,085
|
)
|
|
(3,092,213
|
)
|
|
(2,715,834
|
)
|
|
(19,714,012
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME
TAXES
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS
|
|
$
|
(1,090,904
|
)
|
$
|
(472,085
|
)
|
$
|
(3,092,213
|
)
|
$
|
(2,715,834
|
)
|
$
|
(19,714,012
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
AND DILUTED NET LOSS PER
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMON
SHARE
|
|
$
|
(0.03
|
)
|
$
|
(0.02
|
)
|
$
|
(0.10
|
)
|
$
|
(0.14
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BASIC
AND DILUTED
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OF
COMMON SHARES OUTSTANDING
|
|
|
34,118,509
|
|
|
20,045,873
|
|
|
29,555,877
|
|
|
19,934,446
|
|
|
|
|
METALLINE
MINING COMPANY
|
(AN
EXPLORATION STAGE COMPANY)
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
Period
from
|
|
|
|
|
|
|
|
November
8, 1993
|
|
|
|
|
|
|
|
(Inception)
|
|
|
|
9
Months Ended
|
|
to
|
|
|
|
July
31,
|
|
July
31,
|
|
July
31,
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(3,092,213
|
)
|
$
|
(2,715,834
|
)
|
$
|
(19,714,012
|
)
|
Adjustments
to reconcile net loss to net cash used
|
|
|
|
|
|
|
|
|
|
|
by
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
67,503
|
|
|
62,927
|
|
|
409,363
|
|
Noncash
expenses
|
|
|
-
|
|
|
-
|
|
|
126,864
|
|
Common
stock issued for services
|
|
|
-
|
|
|
-
|
|
|
966,538
|
|
Common
stock issued for compensation
|
|
|
668,715
|
|
|
176,772
|
|
|
1,488,946
|
|
Stock
options issued for services
|
|
|
-
|
|
|
-
|
|
|
801,892
|
|
Stock
options issued for financing fees
|
|
|
-
|
|
|
-
|
|
|
276,000
|
|
Common
stock issued for payment of expenses
|
|
|
-
|
|
|
-
|
|
|
326,527
|
|
Stock
warrants issued for services
|
|
|
-
|
|
|
-
|
|
|
688,771
|
|
Gain
on sale of fixed assets
|
|
|
-
|
|
|
(10,000
|
)
|
|
(10,000
|
)
|
(Increase)
decrease in:
|
|
|
|
|
|
|
|
|
|
|
Marketable
securities
|
|
|
-
|
|
|
650,000
|
|
|
-
|
|
Reclassification
of marketable securities
|
|
|
-
|
|
|
600,000
|
|
|
-
|
|
Accounts
receivable
|
|
|
(12,100
|
)
|
|
74,490
|
|
|
(35,720
|
)
|
Prepaid
expenses
|
|
|
(18,059
|
)
|
|
(30,893
|
)
|
|
(31,301
|
)
|
Employee
advances
|
|
|
8,418
|
|
|
24,462
|
|
|
(1,142
|
)
|
Increase
(decrease) in:
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
(3,682
|
)
|
|
(51,792
|
)
|
|
82,507
|
|
Other
liabilities
|
|
|
12,871
|
|
|
(30,918
|
)
|
|
17,080
|
|
Accrued
liabilities and expenses
|
|
|
(138,744
|
)
|
|
12,022
|
|
|
81,958
|
|
Net
cash used by operating activities
|
|
|
(2,507,291
|
)
|
|
(1,238,764
|
)
|
|
(14,525,729
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
Purchase
of investments
|
|
|
-
|
|
|
-
|
|
|
(484,447
|
)
|
Proceeds
from investments
|
|
|
-
|
|
|
-
|
|
|
484,447
|
|
Proceeds
from sale of fixed assets
|
|
|
-
|
|
|
10,000
|
|
|
10,000
|
|
Equipment
purchases
|
|
|
(60,436
|
)
|
|
(7,598
|
)
|
|
(853,217
|
)
|
Mining
property acquisitions
|
|
|
-
|
|
|
-
|
|
|
(4,452,571
|
)
|
Net
cash used by investing activities
|
|
|
(60,436
|
)
|
|
2,402
|
|
|
(5,295,788
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from sales of common stock with warrants
|
|
|
10,758,737
|
|
|
296,329
|
|
|
27,128,924
|
|
Proceeds
from sales of options and warrants
|
|
|
-
|
|
|
-
|
|
|
949,890
|
|
Proceeds
from exercise of warrants
|
|
|
31,250
|
|
|
|
|
|
31,250
|
|
Deposits
for sale of stock
|
|
|
-
|
|
|
-
|
|
|
125,500
|
|
Proceeds
from shareholder loans
|
|
|
-
|
|
|
-
|
|
|
30,000
|
|
Payment
of note payable
|
|
|
(3,157
|
)
|
|
(3,157
|
)
|
|
(11,575
|
)
|
Net
cash provided by financing activities:
|
|
|
10,786,830
|
|
|
293,172
|
|
|
28,253,989
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) in cash and cash equivalents
|
|
|
8,219,103
|
|
|
(943,190
|
)
|
|
8,432,472
|
|
Cash
and cash equivalents beginning of period
|
|
|
213,369
|
|
|
1,384,030
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents end of period
|
|
$
|
8,432,472
|
|
$
|
440,840
|
|
$
|
8,432,472
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
CASH FLOW DISCLOSURES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
taxes paid
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
Interest
paid
|
|
$
|
520
|
|
$
|
455
|
|
$
|
287,291
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-CASH
INVESTING AND FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for equipment
|
|
$
|
-
|
|
$
|
-
|
|
$
|
25,000
|
|
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
NOTE
1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Metalline
Mining Company ("the Company") was incorporated in the State of Nevada on
November 8, 1993 as the Cadgie Company for the purpose of acquiring and
developing mineral concessions. The Cadgie Company was a spin-off from its
predecessor, Precious Metal Mines, Inc. On June 28, 1996, at a special directors
meeting, the Company's name was changed to Metalline Mining Company. The
Company's fiscal year-end is October 31.
The
Company expects to engage in the business of mining. The Company currently
owns
concessions located in a mining region known as the Sierra Mojada District
that
is located in the municipality of Sierra Mojada, Coahuila, Mexico. The Company
conducts its operations in Mexico through its wholly owned subsidiary
corporation, Minera Metalin S.A. de C.V. ("Minera Metalin").
NOTE
2 - BASIS OF PRESENTATION
The
foregoing unaudited interim financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Regulation S-B as
promulgated by the Securities and Exchange Commission ("SEC"). Accordingly,
these financial statements do not include all of the disclosures required by
generally accepted accounting principles in the United States of America for
complete financial statements. These unaudited interim financial statements
should be read in conjunction with the audited financial statements for the
year
ended October 31, 2005. In the opinion of management, the unaudited interim
financial statements furnished herein include all adjustments, all of which
are
of a normal recurring nature, necessary for a fair statement of the results
for
the interim period presented.
The
preparation of financial statements in accordance with generally accepted
accounting principles in the United States of America requires the use of
estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities known to exist
as
of the date the financial statements are published, and the reported amounts
of
revenues and expenses during the reporting period. Uncertainties with respect
to
such estimates and assumptions are inherent in the preparation of the Company's
financial statements; accordingly, it is possible that the actual results could
differ from these estimates and assumptions and could have a material effect
on
the reported amounts of the Company's financial position and results of
operations.
Operating
results for the nine-month period ended July 31, 2006 are not necessarily
indicative of the results that may be expected for the year ending October
31,
2006.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
Concentration
of Risk
The
Company maintains its domestic cash in two commercial depository accounts.
One
of these accounts is insured by the Federal Deposit Insurance Corporation (FDIC)
for up to $100,000. The other account consists of money market funds,
certificates of deposit and preferred securities, all of which are not insured.
The Company also maintains cash in banks in Mexico. These accounts, which had
U.S. dollar balances of $431,751 and $21,152 at July 31, 2006 and 2005,
respectively, are denominated in pesos and are considered uninsured.
Additionally, the Company maintained a Mexican petty cash balance of $983 at
July 31, 2005. At July 31, 2006, the Company’s cash balances included $8,332,472
which was not federally insured.
Exploration
Costs
In
accordance with accounting principles generally accepted in the United States
of
America, the Company expenses exploration costs as incurred. Exploration costs
expensed during the nine months ended July 31, 2006 and 2005 were $671,649
and
$819,614, respectively. The exploration costs expensed during the Company’s
exploration stage amount to $6,005,735.
Foreign
Operations
The
accompanying balance sheet at July 31, 2006 contains Company assets in Mexico,
including: $4,334,767 in property concessions; $514,855 (before accumulated
depreciation) of mining equipment; and $431,751 of cash. Although this country
is considered economically stable, it is always possible that unanticipated
events in foreign countries could disrupt the Company’s operations. The Mexican
government does not require foreign entities to maintain cash reserves in
Mexico.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
NOTE
3 - RECENT ACCOUNTING PRONOUNCEMENTS
In
March
2006, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 156, “Accounting for Servicing of Financial Assets—an
amendment of FASB Statement No. 140.” This statement requires an entity to
recognize a servicing asset or servicing liability each time it undertakes
an
obligation to service a financial asset by entering into a servicing contract
in
any of the following situations: a transfer of the servicer’s financial assets
that meets the requirements for sale accounting; a transfer of the servicer’s
financial assets to a qualifying special-purpose entity in a guaranteed mortgage
securitization in which the transferor retains all of the resulting securities
and classifies them as either available-for-sale securities or trading
securities; or an acquisition or assumption of an obligation to service a
financial asset that does not relate to financial assets of the servicer or
its
consolidated affiliates. The statement also requires all separately recognized
servicing assets and servicing liabilities to be initially measured at fair
value, if practicable and permits an entity to choose either the amortization
or
fair value method for subsequent measurement of each class of servicing assets
and liabilities. The statement further permits, at its initial adoption, a
one-time reclassification of available for sale securities to trading securities
by entities with recognized servicing rights, without calling into question
the
treatment of other available for sale securities under Statement 115, provided
that the available for sale securities are identified in some manner as
offsetting the entity’s exposure to changes in fair value of servicing assets or
servicing liabilities that a servicer elects to subsequently measure at fair
value and requires separate presentation of servicing assets and servicing
liabilities subsequently measured at fair value in the statement of financial
position and additional disclosures for all separately recognized servicing
assets and servicing liabilities. This statement is effective for fiscal years
beginning after September 15, 2006, with early adoption permitted as of the
beginning of an entity’s fiscal year. Management believes the adoption of this
statement will have no immediate impact on the Company’s financial condition or
results of operations.
In
February 2006, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 155, “Accounting for Certain Hybrid Financial
Instruments, an Amendment of FASB Standards No. 133 and 140” (hereinafter “SFAS
No. 155”). This statement established the accounting for certain derivatives
embedded in other instruments. It simplifies accounting for certain hybrid
financial instruments by permitting fair value remeasurement for any hybrid
instrument that contains an embedded derivative that otherwise would require
bifurcation under SFAS No. 133 as well as eliminating a restriction on the
passive derivative instruments that a qualifying special-purpose entity (“SPE”)
may hold under SFAS No. 140. This statement allows a public entity to
irrevocably elect to initially and subsequently measure a hybrid instrument
that
would be required to be separated into a host contract and derivative in its
entirety at fair value (with changes in fair value recognized in earnings)
so
long as that instrument is not designated as a hedging instrument pursuant
to
the statement. SFAS No. 140 previously prohibited
a qualifying special-purpose entity from holding a derivative financial
instrument that pertains to a beneficial interest other than another derivative
financial instrument. This
statement is effective for fiscal years beginning after September 15, 2006,
with
early adoption permitted as of the beginning of an entity’s fiscal year.
Management believes the adoption of this statement will have no immediate impact
on the Company’s financial condition or results of operations.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
NOTE
4 - CONCESSIONS IN THE SIERRA MOJADA DISTRICT
Sierra
Mojada Mining Concessions
During
the period of August 23, 1996 to July 18, 2000, the Company executed six
separate agreements for the acquisition of eight concessions in the mining
region known as the Sierra Mojada District located in Sierra Mojada, Coahuila,
Mexico. Each agreement enabled the Company to explore the underlying concession
in consideration for the payment of stipulated annual payments. Each of the
concession agreements included an option to purchase the concession and the
annual payments, which were applied in full toward the contracted purchase
price
of the related concession.
The
Company subsequently completed the purchase of the eight concessions, as
follows: Esmeralda, consisting of approximately 118 hectares, on March 20,
1997;
Fortuna, consisting of approximately 14 hectares, on December 8, 1999; Sierra
Mojada and Mojada 3, consisting of approximately 4,767 and 1,689 hectares,
respectively, on May 30, 2000; Unificacion Mineros Nortenos and Vulcano,
consisting of approximately 337 and 4 hectares, respectively, on August 30,
2000; Esmeralda I, consisting of approximately 98 hectares, on August 20, 2001;
and La Blanca, consisting of approximately 34 hectares, on August 20, 2001.
The
Company has recorded the concessions at acquisition cost.
All
of
the concessions were acquired by purchase agreements with Mexican entities
and/or Mexican individuals and all of the concessions were paid for in cash.
In
the acquisition of Sierra Mojada and Mojada 3 there was one purchase agreement
for both concessions. Also, in the acquisition of Unificacion Mineros Nortenos
and Vulcano, there was one purchase agreement for both concessions.
Because
all eight concessions are located in the same mining region and in close
proximity to one another, the concessions are routinely treated as one major
prospect area and are collectively referred to as the Sierra Mojada Project.
The
primary work performed on the Company's concessions has consisted of geologic
mapping, sampling, and drilling. This work has resulted in establishing the
presence of mineralized material (zinc) of sufficient quantity and grade to
justify in the Company's opinion a feasibility study which commenced in
2005.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
NOTE
5 - PROPERTY AND EQUIPMENT
The
following is a summary of the Company's property and equipment at July 31,
2006
and October 31, 2005, respectively:
|
|
July
31, 2006
|
|
October
31, 2005
|
|
Mining
equipment
|
|
$
|
514,855
|
|
$
|
514,855
|
|
Buildings
and structures
|
|
|
141,061
|
|
|
141,061
|
|
Land
- non mineral
|
|
|
15,839
|
|
|
15,839
|
|
Vehicles
|
|
|
76,856
|
|
|
42,068
|
|
Computer
equipment
|
|
|
114,435
|
|
|
88,787
|
|
Office
equipment
|
|
|
4,183
|
|
|
4,183
|
|
Furniture
and fixtures
|
|
|
8,186
|
|
|
8,186
|
|
|
|
|
875,415
|
|
|
814,979
|
|
Less:
Accumulated depreciation
|
|
|
(391,598
|
)
|
|
(324,095
|
)
|
|
|
$
|
483,817
|
|
$
|
490,884
|
|
Depreciation
expense for the periods ended July 31, 2006 and 2005 was $67,503 and $62,927,
respectively.
NOTE
6 - CAPITAL STOCK
Common
Stock
In
March
2005, the Company's board of directors authorized a private placement of up
to
5,333,334 shares of the Company's restricted common stock at a price of $1.125
per share for total proceeds of $6,000,000. Purchasers of these shares also
received a warrant to purchase one share of the Company's common stock at an
exercise price of $2.00 per share with an exercise period of five years. In
September 2005, a modification of the private placement terms was authorized.
The modified terms allow for the issuance of shares of common stock at a price
of $0.80 per share, a warrant exercise price of $1.25 per share and an exercise
period of five years. During the nine months ended July 31, 2006, the Company
issued 13,448,483 shares of common stock under the aforementioned private
placement, for cash consideration at $0.80 per share with attached warrants
valued at an average of $0.29 per share. Net proceeds from this private
placement were $10,758,737. The commission and other costs associated with
this
private placement were $339,816. During the nine months ended July 31, 2006,
warrants for 25,000 shares were exercised for a cash consideration of $1.25
per
share. In addition to the common stock issued through the private placement,
248,593 shares of common stock were issued for prior compensation at $2.69
per
share.
Stock
Options
On
March
1, 2001, the Company's shareholders approved a qualified stock option plan.
The
number of shares eligible for issuance under the qualified plan is to be
determined by the Company's board of directors. The Company has not issued
any
new options since 2002. As of July 31, 2006, there were 670,000 options
outstanding and exercisable. Of this amount, 250,000 were granted to officers
and directors of the Company.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
Summarized
information regarding stock options outstanding and exercisable at July 31,
2006
is as follows:
|
Options
Outstanding
|
|
Options
Exercisable
|
|
Exercise
Price
|
|
Number
Outstanding
|
|
Weighted
Average Remaining Contractual Life (Years)
|
|
Weighted
Average Exercise Price
|
|
Number
Exercisable
|
|
Weighted
Average Exercise Price
|
$
|
1.25
|
|
100,000
|
|
3.02
|
$
|
1.25
|
|
100,000
|
$
|
1.25
|
|
1.32
|
|
370,000
|
|
0.18
|
|
1.32
|
|
370,000
|
|
1.32
|
|
2.15
|
|
200,000
|
|
3.59
|
|
2.15
|
|
200,000
|
|
2.15
|
$
|
1.25-2.15
|
|
670,000
|
|
1.62
|
$
|
1.60
|
|
670,000
|
$
|
1.56
|
Warrants
During
the nine months ended July 31, 2006, the Company issued 13,448,483 common stock
warrants, exercisable at $1.25 per share. A value of $0.29 per warrant was
allocated to these warrants with a total allocated value of $3,924,480 as part
of the investment unit priced at $0.80 per share. During the nine months ended
July 31, 2006, warrants for 25,000 shares were exercised for $1.25 per
share.
NOTE
7 - INCOME TAXES
At
July
31, 2006, the Company had net deferred tax assets calculated at an expected
rate
of 34% of approximately $5,653,000, principally arising from net operating
loss
carryforwards for income tax purposes. As management of the Company cannot
determine that it is more likely than not that the Company will realize the
benefit of the net deferred tax asset, there is a valuation allowance equal
to
the net deferred tax asset.
METALLINE
MINING COMPANY
(AN
EXPLORATION STAGE COMPANY)
CONDENSED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JULY
31, 2006
The
significant components of the deferred tax assets at July 31, 2006 and October
31, 2005 are as follows:
|
|
July
31,
|
|
October
31,
|
|
|
|
2006
|
|
2005
|
|
Net
operating loss carryforward
|
|
$
|
16,625,000
|
|
$
|
13,572,000
|
|
|
|
|
|
|
|
|
|
Deferred
tax asset
|
|
$
|
5,653,000
|
|
$
|
4,614,000
|
|
Deferred
tax asset valuation allowance
|
|
$
|
(5,653,000
|
)
|
$
|
(4,614,000
|
)
|
As
of
July 31, 2006, the Company had net operating loss carryforwards of approximately
$16,625,000, which expire in the years 2008 through 2026. The Company has
recognized approximately $1,491,000 of losses from the issuance of stock options
and warrants for services through fiscal 2005, which were not deductible for
tax
purposes. The change in the allowance account from October 31, 2005 to July
31,
2006 was $1,039,000. The Company has immaterial temporary differences resulting
from differences in tax depreciation of equipment.
NOTE
8 - SUBSEQUENT EVENTS
The
Company’s Board of Directors approved and adopted the 2006 Stock Option Plan,
with a maximum of 5,000,000 shares of common stock. As of July 31, 2006, the
exercise of options granted under “the Plan” is subject to the approval of
shareholders to increase the Company’s authorized common stock.
ITEM
2. Management's
Discussion and Analysis of Financial Condition and Results of
Operations.
Forward-Looking
Statements
This
Quarterly Report on Form 10-QSB, including Management's Discussion and Analysis
of Financial Condition and Results of Operations, contains forward-looking
statements regarding future events and the Company's future results that are
subject to the safe harbors created under the Securities Act of 1933 (the
"Securities Act") and the Securities Exchange Act of 1934 (the "Exchange Act").
These statements are based on current expectations, estimates, forecasts, and
projections about the industry in which the Company operates and the beliefs
and
assumptions of the Company's management. Words such as "expects," "anticipates,"
"targets," "goals," "projects," "intends," "plans," "believes," "seeks,"
"estimates," "continues," "may," variations of such words, and similar
expressions are intended to identify such forward-looking statements. In
addition, any statements that refer to projections of the Company's future
financial performance, the Company's anticipated growth and potentials in its
business, and other characterizations of future events or circumstances are
forward-looking statements. Readers are cautioned that these forward-looking
statements are only predictions and are subject to risks, uncertainties, and
assumptions that are difficult to predict, including those identified elsewhere
herein and in the Company's Annual Report on Form 10-KSB for the fiscal year
ended October 31, 2005 under "Risk Factors." Therefore, actual results may
differ materially and adversely from those expressed in any forward-looking
statements. The Company undertakes no obligation to revise or update any
forward-looking statements for any reason.
Plan
of Operation
The
Company is an exploration stage company formed under the laws of the state
of
Nevada on August 20, 1993, to engage in the business of mining. The Company
(through its subsidiary) currently owns eight concessions that are located
in
the municipality of Sierra Mojada, Coahuila, Mexico. The Company's objective
is
to define sufficient mineral reserves on these concessions to justify the
development of a mechanized mining operation (the "Project"). The Company
conducts its operations in Mexico and owns these eight concessions through
its
wholly owned Mexican subsidiary, Minera Metalin S.A. de C.V.
The
Company’s primary focus has been to explore the Sierra Mojada concessions to
identify available mineral deposits and define a resource. From 1999 through
early 2005 an oxide zinc resource has been defined that management has
determined contains sufficient estimated zinc metal to justify a feasibility
study of the mineralized material. A Feasibility Study has been initiated with
Green Team International of Johannesburg, South Africa as the prime contractor.
The Company’s plan of operation for the next 12 months is to continue work on
the feasibility study to determine whether a mining operation may be profitably
conducted on the Company's concessions. The study is a detailed engineering
and
economic valuation of the iron oxide manto mineralized material. The study
consists of five major elements: Metallurgy, Mine Plan, Extraction, Reduction
and Water Development. The Metallurgy studies have been completed, results
of
which have been announced in a news release dated July 12, 2005. The Mine Plan
studies contract has been awarded to Pincock Allen & Holt of Lakewood,
Colorado. The mine plan studies are in progress and are estimated to require
an
additional four months to complete. The Mine Plan studies will determine the
method used to mine the deposit, the associated mining costs and determine
the
production rate. When the production rate is determined the Extraction and
Reduction plant can be designed and costed. The contemplated Extraction and
Reduction process is known as Solvent Extraction Electrowinning (SXEW). Water
Development is in progress and consists of drilling for a groundwater acquifer
capable of producing sufficient water for the mine and plant.
The
Company estimates that completion of a feasibility study will cost an additional
$3.3 million and the Company expects that it will take an additional 12 to
18
months to complete. Following the completion of a successful feasibility study,
the Company would then proceed to the construction phase, which would entail
construction of a mine and related infrastructure pursuant to a Mine Plan
developed specifically for the Company's concessions, and construction of an
Extraction and Reduction plant to extract metal from the ore that would be
mined. The Company estimates that construction of a Mine (based on the Mine
Plan) and Extraction and Reduction plant would cost approximately $400 million
and take approximately 2 to 3 years to complete after completion of the
feasibility study, assuming sufficient funding is available. The Company intends
to finance construction costs with a combination of equity and debt. In addition
the Company may seek joint venture partners or other alternative financing
sources as necessary to complete development of the project.
In
order
to finance the feasibility study and the business operations described above
for
corporate overhead through completion of the feasibility study, the Company
has
raised capital by selling unregistered shares of its common stock as described
below in “Liquidity and Capital Resources.”
Cautionary
Note
The
Company is an exploration stage company and does not currently have any known
reserves and cannot be expected to have reserves unless and until a feasibility
study is completed for the Sierra Mojada concessions that shows proven and
probable reserves. There can be no assurance that the Company's concessions
contain proven and probable reserves and investors may lose their entire
investment in the Company.
Set
forth
in the Company's Annual Report on Form 10-KSB and in other documents we
file with the Securities and Exchange Commission are risks and uncertainties
that could cause actual results to differ materially from the results
contemplated by the forward-looking statements contained in this Quarterly
Report on Form 10-QSB.
Results
of Operations for the Period Ended July 31, 2006.
Nine
months ended July 31, 2006 compared to the nine months ended July 31,
2005:
During
the nine months ended July 31, 2006, the Company realized other income of
$62,464 from the sale of zinc carbonate ore from the Company's San Salvadore
mine, in accordance with a contract with Cameron Chemicals Inc., Norfolk,
Virginia. Costs associated with the sale of the ore totaled $93,575 in the
nine-month period ended July 31, 2006. There were ore sales of $235,021 in
the
nine-month period ended July 31, 2005. General and administrative expenses
increased to $3,253,220 for the nine-month period ended July 31, 2006 as
compared to $2,742,570 for the nine-month period ended July 31, 2005. The
increase is primarily due to the costs associated with resumption of drilling
activity on the Company's property, resulting in an increase in
exploration-related expenditures of $170,501. Additionally, there was an
increase in payroll costs of $282,484. For the nine months ended July 31, 2006,
the Company experienced a loss of $3,092,213, or $0.10 per share, compared
to a
loss of $2,715,834, or $0.14 per share, during the comparable period in the
previous year.
Liquidity
and Capital Resources.
The
Company financed its obligations during the fiscal year ended October 31, 2005
by the sale of 7,580,150 shares of its common stock during the previous fiscal
year at an average price of $1.00 per share, less issuance costs of $698,863,
and the sale of 476,404 shares of common stock during the year ended October
31,
2005 at an average price of $0.98 per share. During the nine months ended July
31, 2006 the Company sold 13,448,483 shares in private placement transactions
at
a price of $0.80 per share, and issued 25,000 shares at $1.25 per share for
exercise of a warrant. Due to the Company's substantial losses and minimal
revenues, the Company's independent certified public accountants included a
paragraph in the Company's 2005 financial statements relative to a going concern
uncertainty.
The
Company continues to maintain a sampling and drilling program that is budgeted
at approximately $50,000 per month, not including analytical costs which can
vary from $20,000 to $40,000 per month. The Company has estimated that
completion of a feasibility study will cost approximately $6.3 million, but
there can be no assurance that this estimate will not be revised upward. The
Company expects to spend approximately $3.3 million in the next 12 months on
the
feasibility study. The Company believes the feasibility study will be completed
in the next 12 to 18 months.
The
Company's management believes that private placements of its shares have
provided sufficient cash for the Company to continue to operate for at least
the
next twelve months based on current expense projections. Following the
completion of a successful feasibility study, the Company would then proceed
to
the construction phase, which would entail construction of a mine and related
infrastructure pursuant to a mine plan developed specifically for the Company's
concessions, and construction of an extraction plant to extract metal from
the
ore that would be mined. In order to proceed with the construction phase, the
Company would need to rely on additional equity or debt financing, or the
Company may seek joint venture partners or other alternative financing
sources.
Cash
flows for the nine months ended July 31, 2006 were as follows:
During
the nine-month period ended July 31, 2006, the Company's cash position increased
by $8,219,103, due to the private placement sale of 13,448,483 shares of the
Company's common stock at a price of $0.80 per share. Also during this period,
the Company used $2,507,291 in operating activities, principally in connection
with maintaining the property and costs of the private placement, and
implementation of a drilling program.
Critical
Accounting Policies
The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make a variety of estimates and
assumptions that affect (i) the reported amounts of assets and liabilities
and
disclosure of contingent assets and liabilities as of the date of the financial
statements and (ii) the reported amounts of revenues and expenses during the
reporting periods covered by the financial statements.
Our
management routinely makes judgments and estimates about the effect of matters
that are inherently uncertain. As the number of variables and assumptions
affecting the future resolution of the uncertainties increase, these judgments
become even more subjective and complex. Although we believe that our estimates
and assumptions are reasonable, actual results may differ significantly from
these estimates. Changes in estimates and assumptions based upon actual results
may have a material impact on our results of operation and/or financial
condition. We have identified certain accounting policies that we believe are
most important to the portrayal of our current financial condition and results
of operations. Our significant accounting policies are disclosed in Note 2
to
the Consolidated Financial Statements included in this Annual Report on Form
10-KSB.
Fair
Value of Financial Instruments
The
Company's financial instruments as defined by Statement of Financial Accounting
Standards No. 107, "Disclosures about Fair Value of Financial Instruments,"
include cash and cash equivalents, marketable securities, receivables, advances
to employees, accounts payable and accrued expenses. All instruments are
accounted for on a historical cost basis, which, due to the short maturity
of
these financial instruments, approximates fair value at October 31, 2005 and
2004.
Property
Concessions
Costs
of
acquiring property concessions are capitalized by project area upon purchase
or
staking of the associated claims. Costs to maintain the property concessions
and
leases are expensed as incurred. When a property concession reaches the
production stage, the related capitalized costs will be amortized, using the
units of production method on the basis of periodic estimates of ore reserves.
To date no concessions have reached production stage.
Property
concessions are periodically assessed for impairment of value and any diminution
in value is charged to operations at the time of impairment. Should a property
concession be abandoned, its capitalized costs are charged to operations. The
Company charges to operations the allocable portion of capitalized costs
attributable to property concessions sold. Capitalized costs are allocated
to
property concessions abandoned or sold based on the proportion of claims
abandoned or sold to the claims remaining within the project area.
Deferred
tax assets and liabilities
The
Company recognizes the expected future tax benefit from deferred tax assets
when
the tax benefit is considered to be more likely than not of being realized.
Assessing the recoverability of deferred tax assets requires management to
make
significant estimates related to expectations of future taxable income.
Estimates of future taxable income are based on forecasted cash flows and the
application of existing tax laws in each jurisdiction. To the extent that future
cash flows and taxable income differ significantly from estimates, the ability
of the Company to realize deferred tax assets could be impacted. Additionally,
future changes in tax laws in the jurisdictions in which the Company operates
could limit the Company’s ability to obtain the future tax
benefits.
Property
and equipment
Property
and equipment are stated at cost. Depreciation is provided using the
straight-line or accelerated methods over the estimated useful lives of the
assets. The useful lives of property, plant and equipment for purposes of
computing depreciation are five to seven years for equipment, and 39 years
for
buildings.
The
Company evaluates the recoverability of property and equipment when events
and
circumstances indicate that such assets might be impaired. The Company
determines impairment by comparing the undiscounted future cash flows estimated
to be generated by these assets to their respective carrying amounts.
Maintenance and repairs are expensed as incurred. Replacements and betterments
are capitalized. The cost and related reserves of assets sold or retired are
removed from the accounts, and any resulting gain or loss is reflected in
results of operations.
Accounting
for Stock Options and Warrants Granted to Employees and Nonemployees
The
Company currently reports stock issued to employees under the rules of SFAS
No.
123 and therefore, the Company’s accounting for stock options and warrants are
not effected by the issuance of SFAS No. 123R.
In
December 2004, the Financial Accounting Standards Board revised SFAS No. 123
and
issued SFAS No. 123R.
The
warrants were valued using the Black-Scholes option pricing model. The
assumptions used were as follows: volatility of 58%, a risk-free interest rate
of 3% and an exercise term of five years.
The
fair
value of options was determined using the Black-Scholes option pricing model
using a risk free interest rate of 3.25% and a volatility of
42.49%.
Impairment
of Long-Lived Assets
We
review
the net carrying value of all facilities, including idle facilities, on a
periodic basis. We estimate the net realizable value of each property based
on
the estimated undiscounted future cash flows that will be generated from
operations at each property, the estimated salvage value of the surface plant
and equipment and the value associated with property interests. These estimates
of undiscounted future cash flows are dependent upon the estimates of metal
to
be recovered from proven and probable ore reserves and mineral resources
expected to be converted into mineral reserves, future production cost estimates
and future metals price estimates over the estimated remaining mine life. If
undiscounted cash flows are less than the carrying value of a property, an
impairment loss is recognized based upon the estimated expected future cash
flows from the property discounted at an interest rate commensurate with the
risk involved.
Environmental
Matters
When
it
is probable that costs associated with environmental remediation obligations
will be incurred and they are reasonably estimable, we accrue such costs at
the
most likely estimate. Accruals for estimated losses from environmental
remediation obligations generally are recognized no later than completion of
the
remedial feasibility study for such facility and are charged to provisions
for
closed operations and environmental matters. We periodically review our accrued
liabilities for such remediation costs as evidence becomes available indicating
that our remediation liability has potentially changed. Costs of future
expenditures for environmental remediation are not discounted to their present
value unless subject to a contractually obligated fixed payment schedule. Such
costs are based on our current estimate of amounts that are expected to be
incurred when the remediation work is performed within current laws and
regulations. Recoveries of environmental remediation costs from other parties
are recorded as assets when their receipt is deemed probable.
Future
remediation costs for inactive mines are accrued based on management’s best
estimate at the end of each period of the undiscounted costs expected to be
incurred. Such costs estimates include, where applicable, ongoing care,
maintenance and monitoring costs. Changes in estimates are reflected in earnings
in the period an estimate is revised.
Accounting
for reclamation and remediation obligations requires management to make
estimates unique to each mining operation of the future costs the Company will
incur to complete the reclamation and remediation work required to comply with
existing laws and regulations. Actual costs incurred in future periods could
differ from amounts estimated. Additionally, future changes to environmental
laws and regulations could increase the extent of reclamation and remediation
work required. Any such increases in future costs could materially impact the
amounts charged to earnings. At October 31, 2005 the Company has no accrual
for
reclamation and remediation obligations because management cannot make a
reasonable estimate. Any reclamation or remediation costs related to abandoned
concessions has been previously expensed
ITEM
3. Controls
and Procedures.
Disclosure
Controls and Procedures.
The
Company's principal executive officer and principal financial officer have
evaluated the effectiveness of the Company's disclosure controls and procedures
(as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange
Act) as of the end of the period covered by this report. Based on such
evaluation, the Company's principal executive officer and principal financial
officer have concluded that, as of the end of such period, the Company's
disclosure control and procedures are effective in recording, processing,
summarizing and reporting, on a timely basis, information required to be
disclosed by the Company in the reports that it files or submits under the
Exchange Act.
The
Company's management has also concluded that the Company's disclosure controls
and procedures are effective to ensure that information required to be disclosed
in the Company's reports filed under the Exchange Act is accumulated and
communicated to management, including the principal executive officer and
principal financial officer, to allow timely decisions regarding required
disclosure.
Changes
in Internal Control Over Financial Reporting.
There
was
no change in the Company's internal control over financial reporting that
occurred during the fiscal quarter to which this report relates that has
materially affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.
PART
II - OTHER INFORMATION
ITEM
6. Exhibits.
3.1 |
Articles
of Incorporation.
(1)
|
3.2 |
Certificate
of Amendment to Articles of Incorporation, filed
herewith.
|
3.3 |
Bylaws,
as amended, filed herewith.
|
31.1
|
Certification
of CEO Pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed
herewith.
|
31.2 |
Certification
of CFO Pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted
pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002, filed
herewith.
|
32.1 |
Certification
of CEO Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section
906 of the Sarbanes-Oxley Act of 2002, filed
herewith.
|
32.2
|
Certification
of CFO Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section
906 of the Sarbanes-Oxley Act of 2002, filed
herewith.
|
|
(1)
|
Incorporated
by reference from Form 10-SB, filed October 15,
1999.
|
METALLINE
MINING COMPANY
An
Exploration Stage Company
SIGNATURES
In
accordance with Section 12, 13 or 15(d) of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
METALLINE
MINING COMPANY
|
|
|
|
|
|
|
|
September
18,
2006 |
By: |
/s/
Merlin D. Bingham |
Date
|
Merlin
D. Bingham, its President |
|
|
|
|
|
|
|
|
|
|
September
18, 2006 |
By: |
/s/
Wayne L. Schoonmaker |
Date
|
Wayne
L. Schoonmaker, its |
|
Principal Financial
Officer |
EXHIBIT
INDEX
3.1 |
Articles
of Incorporation(1)
|
3.2 |
Certificate
of Amendment to the Articles of Incorporation, filed
herewith
|
3.3
|
Bylaws,
as amended, filed herewith.
|
31.1
|
Certification
of Principal Executive Officer pursuant to Rule 13a-14(a) of the
Exchange
Act. Filed herewith.
|
31.2
|
Certification
of Principal Financial Officer pursuant to Rule 13a-14(a) of the
Exchange
Act. Filed herewith.
|
32.1
|
Certification
of Principal Executive Officer pursuant to 18 U.S.C. Section 1350.
Furnished herewith.
|
32.2
|
Certification
of Principal Financial Officer pursuant to 18 U.S.C. Section 1350.
Furnished herewith.
|
|
(1)
|
Incorporated
by reference from Form 10-SB, filed October 15,
1999.
|