SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 30, 2021March 31, 2022
Commission File No. 001-10156
ORIGINAL SIXTEEN TO ONE MINE, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA 94-0735390
(State or other jurisdiction of (I.R.S. Employer
Identification No.)
incorporated or organization)
Post Office Box 909, Alleghany, CA 95910
(Address of principal executive offices)
(530) 287-3223
(Registrant's telephone number)
(including area code)
Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the 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 requirement for the past 90 days.
N/A Voluntary Filer
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of
"large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer
[ ]
Non-accelerated filer [ ] (do not check if smaller reporting
company)
Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-d of the Exchange Act). Yes
[ ] N0 [X]
As of September 30, 2021,March 31, 2022, 14,870,631 shares of Common Stock, par
value $.033 per share, were issued and outstanding.
=
Item 1. PART I
Original Sixteen to One Mine, Inc.
Condensed Balance Sheet
September 30, 2021March 31, 2022 & December 31, 20202021
ASSETS
2022 2021 2020
Current Assets
Cash $ 22,8801,608 $ 22,1264,802
Accounts receivable 114,132 55,775129,552 127,564
Inventory 128,036 309,576
Other current assets - -130,438 130,438
Capitalized Expenses 727,328 604,044
------- -------
Total current assets 265,048 387,477988,926 866,848
------- -------
Mining Property
Real estate and property rights
net of depletion of $524,145 230,401 230,401
Mineral property 47,976 47,976
------- -------
Total Mining Property 278,377 278,377
------- -------
Fixed Assets at Cost
Equipment 632,602605,646 597,602
Buildings 209,487 209,487
Vehicles 168,925 168,925
--------- ---------
Total fixed assets at cost 1,011,014984,058 976,014
--------- ---------
Less accumulated depreciation (971,174) (969,054)(964,222) (963,606)
----------- -----------
Net fixed assets 39,840 6,96019,836 12,408
----------- -----------
Other Assets
Bonds and misc. deposits 14,869 14,8694,091 4,091
--------- -------
Total Assets $ 598,1341,291,230 $ 687,6831,161,724
========== ==========
Original sixteen to One Mine, Inc.
Condensed Balance Sheet Continued
LIABILITIES & STOCKHOLDERS' EQUITY
2022 2021 2020
Current Liabilities
Accounts payable & accrued expenses $ 1,356,601 1,327,5321,474,903 1,417,728
Due to related party 252,686 279,237616,574 515,993
Notes payable Short-term 538,558 538,558563,558 543,558
-------- -------
Total Current Liabilities 2,147,845 2,145,3272,655,035 2,477,279
-------- -------
Long Term Liabilities
Notes payable due after one year 126,836 126,83697,236 97,236
-------- -------
Total Liabilities 2,274,682 2,272,1632,752,271 2,574,515
---------- ---------
Stockholders' Equity
Capital stock, par value $.033:
30,000,000 shares authorized: 14,390,63114,870,631
issued and outstanding as of Dec. 31, 20202021
and 14,870,631 as of Sept 30, 2021March 31, 2022
490,731 474,891490,731
Additional paid-in capital 2,446,044 2,221,8842,446,044
(Accumulated deficit)
Retained earnings (4,613,323) (4,281,255)(4,397,816) (4,349,566)
------------ -----------
Total Stockholders' Equity (1,676,548) (1,584,480)(1,461,041) (1,412,791)
------------ -----------
Total Liabilities and
Stockholders' Equity $ 598,1341,291,230 $ 687,6831,161,724
=========== ============
See Accompanying Notes
?
Original Sixteen to One Mine, Inc.
Statement of Operations and Retained Earnings
Three Months Ending Sept 30, Six Months Ending Sept 30,March 31,
2022 2021 2020 2021 2020
------ ------
------ ------
Revenues:
Gold & Jewelry
Sales (59,837) 17,130 (28,411) 88,455- 5,464
Other Revenue 1,988 -
--------- --------- --------- --------
Total revenues $ (59,837)1,988 $ 17,130 $(28,411) 88,4555,464
--------- --------- ---------- --------
Operating expenses:
Salaries and wages 15,000 15,000
45,000 43,024
Contract Labor 32,453 5,715 41,625 46,2378,018 5,538
Utilities 21,674 18,830 66,455 55,3695,248 7,177
Taxes 411 4,294 5,664 13,9483,181 412
Supplies 2,731 202 4,433 2,903(385) 1,161
Insurance 1,046 600 6,891 2,8603,052 2,973
Small equip.& repairs 3,674 1,662 7,260 5,2831,943 2,310
Drayage (1,134) 782 5,764 5,7177,690 1,570
Corporate expenses 7,972 7,752 27,509 11,9751,045 233
Legal/Compliance 34,039 25 34,854 12,1045,350 180
Mine Maintenance 793 1,052 3,902 2,415143 1,015
Depreciation & amort. 707 2,442 2,120 7,325616 596
Other expenses 208 251 5,686 1,536
- ------- -------637 2,721
-------- --------- ----------
Total operating
expenses 119,574 58,607 257,163 210,69651,538 40,886
-------- -------- --------- ----------
Profit (Loss) from
Operations (179,411) (41,477) (285,574) (122,241)(49,550) (35,422)
Other Income: 1,300 1,200 1,200 3,600 3,600
Other Expense: - -
4,258 -
--------- -------- --------- ----------
Total Other income 1,300 1,200 1,200 (658) 3,600
--------
-------- --------- ----------
Profit (Loss)
before taxes (178,211) (40,277) (286,232) (118,641)
---------- ---------(48,250) (34,222)
--------- ---------
Income tax benefit
(expense) - -
(1,600) (800)
---------- --------- --------- ---------
Net profit
(loss) $(178,211) $ (40,277) (287,832) (119,441)
===========(48,250) (34,222)
========== ========= =========
Basic and diluted (loss)
earnings per share $ (.002) $ (.003) $ (.007) $ (.006)(.002)
========== ========== ========= ===========
Shares used in the
calculation of net (loss)
income per share
14,870,631 14,390,631
14,870,631 14,390,631
============ =========== ========== ==========
See Accompanying Notes
Original Sixteen to One Mine, Inc.
Statement of Cash Flows
SixThree Months Ended Sept 30,March 31, 2022 and March 31, 2021
and Sept 30, 2020
NineThree Months Ended September 30,March 31,
2022 2021 2020
-------------- ------------
Net profit (loss) $ (287,833)(48,250) $ (137,201)(34,222)
Cash Flows From Operating Activities:
Depreciation and amortization 2,120 7,325616 596
(Increase)Decrease in
accounts receivable (55,357) 750(1,988) (2,237)
Decrease(Increase) in inventory 181,747 (2,033)- 2,348
(Increase)Decrease in other
current assets - -(123,285) (39,059)
(Decrease) increase in accounts payable
and accrued expenses 29,089 5,48157,176 19,175
(Decrease)increase in related party loans
(26,677) 734100,581 51,605
Decrease) increase in short term notes -20,000 -
------------ -------
Net cash (used) provided by
operating activities (159,911) (124,944)4,850 (1,794)
------------ -------------------
Cash Flows From Investing Activities:
Fixed Asset Purchases (35,000)(8,044) -
Proceed from sale real estate - -
Other assets bonds misc. deposits - -
----------- - ----------
Net cash (used) provided by
investing activities (35,000)(8,044) -
----------- -----------
Cash Flows From Financing Activities
Increase (decrease) notes payable (43,355) 141,006- -
Proceeds from sale of common stock 15,840- -
Additional paid-in capital 224,160- -
----------- -----------
Net cash provided (used) by
financing activities 196,645 141,006- -
------------ ------------
(Decrease) increase in cash 1,734 16,062(3,194) (1,794)
Cash, beginning of period 21,145 3,454
------------ ----------4,802 21,137
Cash, end of period $ 22,8791,608 $ 19,51619,343
============ ============
Supplemental schedule of other cash flows:
Cash paid during the period for:
Interest expense $ - $ -
============ ===========
Income taxes $ 1,600- $ 800-
============ ===========
NOTES TO THE FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business: Original Sixteen to One Mine, Inc. (the
Company) incorporated in 1911, actively operates the Sixteen
to One mine in Alleghany, California.
Inventory: Inventory consists of gold bullion and gold ore.
Gold is quoted at the current market price.
Fixed Assets: Fixed assets are stated at historical cost.
Depreciation is calculated using straight-line and
accelerated methods over the following useful lives: Vehicles
3 to 5 years, Equipment 5 to 7 years, Buildings 18 to 31.5
years. Company does not capitalize underground expenses or
exploration.
Depletion Policy: Because of the geological formation in the
Alleghany Mining District, estimates of proven reserves
cannot be calculated, and accordingly, a cost per unit
depletion factor cannot be determined. No depletion
deduction is recorded.
Revenue Recognition: New production of gold is recorded as an
asset at the current spot price (.999 fine purity). For
income tax purposes revenues are not recognized until the
gold is sold.
Use of Estimates: Preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions.
Estimates and assumptions affect reported amounts of assets
and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the
reporting period. Actual results may differ from these
estimates.
GENERAL NOTES
1. In accordance with directive from the Securities and
Exchange Commission (SEC)and Industry Guide 7, reference for
all intent and purposes to the Company's employees as miners,
its properties as mines or its operation as mining does not
diminish the fact that the Company has no proven reserves for
the period. The "exploration state" as defined in Guide
7(a)(4)(iii) may apply.
2. Financial statements contain adjustments (consisting only
of normal recurring accruals) necessary to
present fairly the Company's financial position at September 30, 2021March 31,
2022 and December 31, 2020.2021. The results of operations and
cash flows for the thirdfirst quarter of 2022 and 2021 and 2020 and showing the nine-
month year-to-date ending September 30, 2021 and 2020.
Unaudited financialare
reported. Financial statements are prepared in accordance
with Generally Accepted Accounting Principles for interim
financial information and with instructions to Form 10-Q and
Item 310(b) of Regulation S-B.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF
OPERATION
The Sixteen to One mine in the Alleghany Mining District is a
unique gold deposit and requires an unfamiliar operation,
which is recognized by its owners, its miners, geologists,
engineers, and some public agencies for 125 years. It is a
rare California high-grade, hard rock, underground gold mine.agencies. The Company celebrated
its 100th year anniversary on Oct. 9, 2011. becoming the
oldest gold mining corporation in the United States.
Experts estimate that sixty percent or more of
the gold deposit remains. Production is approximately 1,500,000 ounces of gold.
Over thirtyThirty miles of horizontal workings and millions of cubic
feet of vertical excavations called stopes exist. The
entire grounds are not maintained for mining. Once an
area is targeted, for mining, travel ways and escape routes are brought
into safety compliance. Production miners set up a heading
(face) and begin a drill-blast-muck sequence into the quartz. Gold
is hosted in the quartz vein as exceedingly
rich concentrations called "pockets".vein. Metal detectors are regularly
used underground as a tool for guiding the direction of the
work. Metal detectors are also used as a
toolwork and to classify the ore underground. A positive effect
reduces the volume of rock taken from the mine,underground, thereby reducing
costs.
In 1992, the company initiated a gold marketing plan of
selling gold in quartzProduction is termed as a gemstone. This produces revenue
significantly greater than selling gold into the spot market.
Demand for the Sixteen to One gold-in-quartz gemstone exceeds
supply.
Production has been termed a "feast or famine" situation for
over 100 years. Reserves in this high-grade gold mine cannot
be termed as "proven". At the Sixteen to One the search for
gold embraces: (1) historical maps; (2) geophysical
prospecting; (3) underground headings, drifts or tunnels. When operations
detect the presence of gold, the Company evaluates the
environment and changes from exploration to development to production rapidly. The company hoards gold
and sells it according to short-term cash needs. These facts
create headaches for the Company managing cash flow between
pockets.
Balance Sheet notes:into
production.
FINANCIAL REPORT NOTES:
No value is recorded on the balance sheet for timber
reserves. The company owns 470 acres of prime forested
timberland.standing
timber. No value is recorded on the balance sheet for the Company owned water-rights.water-
rights. Reduced value is recorded on the balance sheet for
buildings, equipment and land. No value is recorded on the
balance sheet for marketable
aggregate and decorative stone currently stockpiled. No
value is recorded on the balance sheet for goodwill. Fixed
assets are recorded at historic cost less depreciation which
cloud the true value of Company assets.
BALANCE SHEET COMPARISONS
For the three-month period ended September 30,March 31,2022, compared to
December 31, 2021, there waswere no significant changes to the
balance sheet.
STATEMENT OF OPERATIONS
Revenues
Gold revenues for the six-month period ending September 30,
2021, decreased by $39,695 (56%) compared with the same
period in 2020 due to supporting COVID-19 California and
federal restrictions, decrease in sales, and the emphasis on
maintenance instead of producing gold.
Expenses
For the nine-monththree-month period ended September 30, 2021,March 31, 2022, compared to
the same period in 20202021, total operating expenses decreasedincreased
by $33,230 (15%$10,652 (21%) due to support and comply with COVID-19
California and federal restrictions.expanding pumping programs.
For the nine-monththree-month period ended September 30, 2021,March 31, 2022, compared to the
same period in 2020,2021, the company showed a loss of $287,932$48,250
compared to a loss of $137,201.$34,222. The $150,632 (109%$14,028 (30%) difference is
due booking legal fees from 2019 that were overlooked,
bringing Directors fees up to date and adjusting inventory that
hasn?t been done for yearsexpanded pumping programs.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
From time to time theThe Company makesmay make written and oral forward-
lookingforward-looking
statements about matters that involve risks and uncertainties
that couldmay cause actual results to differ
materially from projected
results. Important factors that couldmay cause actual results to
differ materially include, among others:
- Fluctuations in the market prices of gold
- General domestic and international economic political and governmentalpolitical
conditions
- Unexpected geological conditions or rock stability conditions
resulting in cave-ins, flooding, rock-bursts or rock slides
- The speculative nature of mineral explorationconditions.
- Environmental risks
- Changes in laws and government regulations, includingespecially those
relating to taxestaxes.
- The availability and the environmenttiming of permits and approval relating
to operations, expansion of operations, and financing of
operations
- Fluctuations in interest rates and other adverse financial
market conditions
- Labor relations
- Accidents
- Unusual weather or operating conditions
- Force majeure events
These factors are beyond the Company's ability to control or
predict. Investors are cautioned not to place undue reliance
on forward-looking statements. The Company will update its
forward-looking statements, whether as a result of receiving
new information, the occurrence of future events or otherwise
if significant.events.
ITEM 4: CONTROLS AND PROCEDURES
SecurityDuring gold production, security procedures include multiple
levels of gold custody, from the mine to sales. Inventory
control procedures were set
upestablished by ana SEC certified auditing
firm and continue to be
followed.firm.
PART II
Item 1 LEGAL PROCEEDINGS
Company defended criminal allegations initiated by the
California District Attorney Association. On July 12, 2021
Sierra County District Attorney dismissed all criminal
charges. The decision was approved in the California Superior
Court, Sierra County on July 13, 2021. Civil charges to be
discussed with Sierra County officials at a later date.None
Item 1a RISK FACTORS
(a) Price of Gold
The currentdaily spot price of gold has modest financial effect on
gross revenue if it's between $1,700 and $1,800 an ounce has limited financialounce. A
drop below $1,700 may have an adverse effect on grossthe Company's
revenue. Closing spot price on DecemberMarch 31, 2020,2022, was $1,803.28 and on
September 30, 2021, it was $1,742.80 an ounce.$1,942.15.
(b) Lack of Proven Reserves
Because proven reserves are not utilized as a component for
evaluating future earnings or ore values, aA sense of uncertainty of existence is perceived by some. Caution is
always recommended in using the doctrines of reserves as an economic tool for valuing
a mining company. While (i) the
Company has recovered over one million ounces of gold and
(ii) management knows that substantial additional virgin
veins exist in the Sixteen to One mine, theThe Company has no ability to measure
potential gold productionreserves using the mathematical tools generally recognized in the
mining industry; however, the company can prove that approximately
seventy percent (70%) of its vein systems have not been
developed.industry.
(c) Governmental Regulation
The attached financial statements have not been audited by a
Securities Exchange Commission (SEC) accounting firm.are unaudited. Therefore,
the Company is not in full compliance with thisthe SEC regulation
for companies listed on an exchange. State and federal statutes regulate environmental quality,
safety, exploration procedures, reclamation, employee?s
health and safety, use of explosives, air quality standards,
pollution of stream and fresh water sources, noxious odors,
noise, dust, and other environmental protection controls as
well as the rights of adjoining property owners. Laws may
change preventing or delaying the commencement or continuance
of given operations.
The Company is substantially in
compliance with all known safety and environmental standards
and regulations.
The
California Central Valley Regional Water Quality Control
Board permit was approved an additional five years in June
2021. The NPDES permit program, created in 1972 by the Clean
Water Act (C WA), helps address water pollution by regulating
point sources that discharge pollutants to waters of the
United States. The federal EPA Administration Order became
effective August 16, 2021. The Company expends working
capital and time defending excessive and punitive behavior.
There is no assurance that future changes in the laws or
regulations.
(d) Liquidity
Gold inventory at September 30, 2021, was $128,036. Raw
materialA buy market for gold is recorded atglobal and a spot price per troy ounce.ounce is
always available.
(e) Price of Stock
Bids and offers are publicly recorded on the stock page of the
Company's web site and a gray market. There were no
trades listed for the past three years.site. Exposure is limited.
Thenegligible. A per share price
of stock may not accurately reflect its fair market
value because ofoffer exists for shareholders listed on the limited marketplace and the existence of
a wild and free gray market. The company deferred programs
to support or promote its stock.October 2021,
shareholder list at $1.00 per share which expires on March 31,
2023.
Item 2 UNREGISTERED SALES OF EQUITY
None
Item 3. DEFAULTS ON SECURITIES
None
Item 4. MINE SAFETY DISCLOSURES
For the nine-monththree-month ended September 30, 2021,March 31, 2022, the Mine Safety and
Health Administration (MSHA) issued no citations or orders to
report.
Item 5. OTHER INFORMATION
The unaudited interim consolidated financial statements of
the Company are prepared by management in
accordance with generally accepted accounting practices.
Such rules allow the omission of certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted audited
accounting principles as long as the statements are not
misleading.
In the opinion of management, verified by signature below,
allAll adjustments necessary for a fair presentation of thesethe
interim statements have beenare included. These adjustments are of a
normal recurring nature.
The preparation of the Company's financial statements in
conformity with accounting principles accepted in the United
States requires management to make estimates and assumptions.
These estimates and assumptions affect reported amounts of
assets and liabilities and disclosure of contingent
liabilities at the date of financial statements, as well as
reported amounts of revenues and expenses during the
reporting period. On an ongoing basis, managementManagement evaluates its estimates and assumptions; however, actual
amounts may differ. No accounting principle upon which the Company's
financial status depends, requires estimates of proven and
probable reserves and/or assumptions of future gold prices.
Commodity prices may significantly affect the company's
profitability and cash flow. No independent accounting firm or
auditors have any responsibility for the accounting and
written statements of the Form 10-Q.
The Company and its president assume responsibility for the
accuracy of this filing and certify the financial statements
present fairly in all material respects, the financial
position of Original Sixteen to One Mine, Inc at September
30, 2021.March 31,
2022.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
ORIGINAL SIXTEEN TO ONE MINE, INC.
(Registrant)
Michael M. Miller
President and Director
Dated: December 21, 2021August 23, 2022