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SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-QSB QUARTERLY REPORT UNDER SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30,2000 NEW JERSEY MINING COMPANY -------------------------- (Name of small business issuer in its charter) IDAHO 82-0490295 - --------------------------- ----------------------------------- (State or other jurisdiction (I.R.S. Employer Identification No.) of incorporation or organization) P.O. Box 1019 (Street: 89 Appleberg Road) Kellogg, Idaho 83837 - ------------------------------------------- ----------- (Address of principal executive offices) (Zip Code) (208)783-3331 - --------------------------- Issuer's telephone number Securities registered under Section 12(b) of the Act: None - ------------------- ------------------------------ Title of each class Name of each exchange on which registered Securities registered under Section 12(g) of the Act: Common Stock- No Par Value -------------------------- Title of Class Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 reqirements for the past 90 days. Yes XX No ----- ----- The number of outstanding shares of the registrant's common stock at September 30, 2000 was 11,597,590 shares -----------------
TABLE OF CONTENTS Page PART I - FINANCIAL INFORMATION Item 1. Financial Statements 2 Item 2. Management's Discussion and Analysis 2 PART II - OTHER INFORMATION Item 1. Legal Proceedings 3 Item 2. Changes in Securities 3 Item 3. Defaults Upon Senior Securities 3 Item 4. Submission of Matters to a Vote of Security Holders 3 Item 5. Other Information 3 Item 6. Exhibits and Reports on Form 8-K 3
PART I ITEM 1. FINANCIAL STATEMENTS The unaudited financial statements of the Company for the periods covered by this report are included elsewhere in this report, beginning at page F/S-1. The unaudited financial statements have been prepared by the Company in accordance with generally accepted accounting principles for interim financial information with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the the Company's management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine month period ended September 30, 2000 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2000. For further information refer to the financial statements and footnotes thereto in the Company's Annual Report on Form 10-KSB for the year ended December 31, 1999 incorporated by reference herein. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Company's cash flow materially increased for the nine months ended September 30, 2000 versus the same period of 1999, for which the primary reason was the sale of 135,000 shares of Consil Corp. common stock. In 1999 the book value of common stock in Consil Corporation was written down by $47,500 causing a loss for 1999 of $23,738. The write down has been spread evenly across the four quarters of 1999. At year end 1999, Consil had no business plans for increasing shareholder value. For the nine months ended September 30, 2000, the Company experienced a loss of $22,204 compared to a loss of $17,804 during the comparable period in the previous year. The Company currently leases the New Jersey mill and mine mine facilities to the largest shareholder. Should gold and silver prices rise from the current low levels, the Company may be able to resume financing activities. The Company would be able to end the lease arrangement with the current leasee and resume construction of the mineral processing plant, exploration, and mining activities. On July 14, 2000 the Company entered into an agreement with Trend Mining Co. to acquire the Silver Strand mine located 12 miles east of Coeur d'Alene, Idaho. The property consists of 15 unpatented lode claims. The agreement calls for New Jersey to issue 50,000 restricted common shares of its stock and spend $200,000 in work commitments over three years. Trend Mining Co. will retain a 1.5% Net Smelter Return (NSR) royalty capped at $50,000 at which time the NSR is reduced to 0.5%. The historical production from the Silver Strand mine totals 12,500 metric tonnes with 3.19 grams per tonne gold and 328.5 grams per tonne silver. Production ceased in the early 1980's. The Company is involved in exploring for and developing gold, silver and base metal ore resources in northern Idaho. The Company has a portfolio of four mineral properties in the Coeur d'Alene Mining District: the New Jersey mine, the Silver Strand mine, the CAMP project and the Wisconsin-Teddy project. The New Jersey mine and the Silver Strand mine are the Company's development stage properties while the other two properties are exploration stage properties. The New Jersey mine is located 3 miles east of Kellogg, Idaho. The Company's New Jersey mine property has an area of approximately 370 acres and includes a group of mineral leases. A mineral lease from Gold Run Gulch Mining Company includes 5 patented claims containing 62 acres, seven unpatented claims surrounding the patented claims, and mineral rights to fee land containing 108 acres. The known gold orebody is located on the patented claims. Another mineral lease from William Zanetti in the New Jersey mill area contains about 60 acres. Both mineral leases carry a 5% Net Smelter Return royalty. For a more complete description of the Company's properties refer to the Company's Annual Report on Form 10-KSB for the year ended December 31, 1999. PART II ITEM 1. LEGAL PROCEEDINGS The Company is not currently involved in any legal proceedings and is not aware of any pending or potential legal actions. ITEM 2. CHANGES IN SECURITIES Neither the constituent instruments defining the rights of the registrant's security holders nor the rights evidenced by the registrant's outstanding common stock have been modified, limited or qualified. ITEM 3. DEFAULTS UPON SENIOR SECURITIES The registrant has no outstanding senior securities. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of the registrant's security holders during the period covered by this report. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K Exhibits Exhibit 27.0 Financial Data Schedule Reports on Form 8-K No reports on Form 8-K were filed by the registrant during the period covered by this report. NEW JERSEY MINING COMPANY INDEX TO FINANCIAL STATEMENTS Page Balance Sheets as of September 30, 2000 and September 30, 1999 F/S-1 Statements of Operations for the nine months ended September 30, 2000 and 1999. F/S-2 Statements of Cash Flow for the nine months ended September 30, 2000 and 1999. F/S-3 Notes to Interim Financial Statements F/S-4 <TABLE> NEW JERSEY MINING COMPANY (A Development Stage Company) BALANCE SHEET ASSETS Sept 30 Sept 30 2000 1999 -------- --------- <S> <C> <C> Current Assets Cash $ 1,831 $ 233 Property & Equipment Building $ 33,894 $ 33,894 Equipment $246,536 $246,536 Other Assets Deferred Development Costs $ 80,881 $ 80,881 Investment in Consil Corporation $ 8,000 $ 49,875 Mining Reclamation Bond $ 2,073 $ 1,722 Goodwill $ 30,950 $ 30,950 Total Assets $404,165 $444,091 </TABLE> <TABLE> LIABILITIES AND STOCKHOLDERS EQUITY <S> <C> <C> Current Liabilities Accounts Payable & accrued expenses $ 0 $ 1,995 Current Maturities of Capital Lease Obligations $ 4,964 $ 11,020 Total Current Liabilities $ 4,964 $ 13,015 Capital Lease Obligations (less current maturities) $ 8,486 $ 12,223 Total Liabilities $ 13,450 $ 25,238 Stockholders Equity Preferred Stock No shares issued Common Stock No Par Value, 20,000,000 shares authorized
1999 September 30, 1999 13,378,634 Issued $647,836 2000 September 30, 2000 13,545,334 Issued $ 647,836 Treasury Stock $(136,300) $(136,300) (1,947,744 shares) Retained Earnings $ (23,738) $ -0- Deficit Accumulated in the Development Stage $ (74,879) $(74,879) Net Income $ (22,204) $(17,804) Total Stockholders Equity $ 390,715 $418,853 Total Liabilities and Stockholders Equity $ 404,165 $444,091 </TABLE> F/S-1
<TABLE> STATEMENT OF OPERATIONS (For the nine month period ending September 30) Sept 30 Sept 30 2000 1999 -------- ------- <S> <C> <C> Revenues $ (15,031) $ 18,027 Operating and Administrative Expenses $ (7,173) $ (206) Net Income from Operations(Loss) $ (22,204) $ 17,821 Loss on Devaluation of Investments $ -0- $ (35,625) Net Loss $ (22,204) $ (17,804) Basic Earnings (Loss) Per Share $ (0.0019) $ (0.0016) </TABLE> F/S-2
<TABLE> STATEMENT OF CASH FLOWS (For the nine month period ending September 30) Sept 30 Sept 30 2000 1999 -------- ------- <S> <C> <C> INCREASE (DECREASE) IN CASH Cash Flows From Operating Activities Net Income (Loss) $ (22,204) $ 17,821 Adjustment to reconcile net loss to net cash used in Operating Activities: Capital Loss on sale of stock $ 22,414 Decrease in accounts payable and accrued expenses $ 0 $ (5,984) Net cash from operating activities $ 210 $ 11,837 Cash Flows From Investing Activities Additions to property and equipment $ 0 $ 0 Proceeds from sale of investments $ 7,586 $ 0 Increase in Reclamation Bond $ (351) Net cash from investing activities $ 7,235 $ 0 Cash Flows From Financing Activities Principal payments on capital lease obligations $ (5,896) $(11,689) Net cash provided by financing activities $ (5,896) $(11,689) Net Increase (Decrease)in Cash $ 1,549 $ 148 Cash, Beginning of Year $ 282 $ 85 Cash, End of Six Month Period $ 1,831 $ 233 Supplemental Schedule of Noncash Investing and Financing Activities Devaluation of Investment in Consil Corporation $(35,625) F/S-3
</TABLE> NEW JERSEY MINING COMPANY NOTES TO INTERIM FINANCIAL STATEMENTS - UNAUDITED These unaudited financial statements have been prepared by the Company in accordance with generally accepted accounting principles for interim financial information with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the the Company's management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine month period ended September 30, 2000 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2000. For further information refer to the financials statements and footnotes thereto in the Company's Annual Report on Form 10-KSB for the year ended December 31,1999 incorporated by reference herein. Note 1 - Form and Organization New Jersey Mining Company (the company) is a corporation organized under the laws of the State of Idaho on July 18, 1996. The Company was dormant until December 31,1996, when all of the assets and liabilities of the New Jersey Joint Venture ( a partnership) were transferred to the Company in exchange for 10,000,000 shares of common stock. The New Jersey Joint Venture, a partnership, was formed in 1994 to develop the New Jersey mine. Note 2 - Leases of Mining Claims The Company has been assigned mining leases with Gold Run Gulch Mining Company and William Zanetti. The leases provide for the Company's exploration, development and mining of minerals on patented and unpatented claims through October 2008 and thereafter as long as mining operations are deemed continuous. The leases provide for production royalties of 5% of net sales of ores or concentrates. Additional production royalties of 1% to 5% are due if gold exceeds $559 per troy ounce. Also, annual advance royalties totaling $2,900 are required under the leases. The advance royalties, charged to expenses as incurred, are accumulated and will be credited against the production royalty obligations. The lessor may terminate the leases upon the Company's failure to perform under these terms of the leases. The Company may also terminate the leases at any time. Mine Systems Design, Inc., the majority shareholder of New Jersey Mining Company - 66.6%, has agreed to fulfill all mineral lease requirements necessary for mineral lease permits. F/S-4 SIGNATURES In accordance with the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. New Jersey Mining Company Date: November 9, 2000 By /s/ FRED W. BRACKEBUSCH ----------------- --------------------------------- Fred W. Brackebusch, President, Treasurer & Director Date: November 9, 2000 By /s/ GRANT A. BRACKEBUSCH ------------------ --------------------------------- Grant A. Brackebusch, Vice President & Director
Exhibit 27.0 Financial Data Schedule This schedule contains summary financial information extracted from the Financial Statements of New Jersey Mining Company for the nine months ending September 30, 2000 and is qualified in its entirety by reference to such financial statements. <PERIOD TYPE> 9-MOS <TABLE> <S> <C> [FISCAL-YEAR-END] DEC-31-1999 <PERIOD START> JAN-01-2000 <PERIOD END> SEP-30-2000 [CASH] 1,831 [SECURITIES] 0 [RECEIVABLES] 0 [ALLOWANCES] 0 [INVENTORY] 0 [CURRENT-ASSETS] 1,831 [PP&E] 280,430 [DEPRECIATION] 0 [TOTAL-ASSETS] 404,165 [CURRENT-LIABILITIES] 4,964 [BONDS] 0 [PREFERRED-MANDATORY] 0 [PREFERRED] 0 [COMMON] 647,836 [OTHER-SE] 0 [TOTAL-LIABILITY-AND-EQUITY] 404,165 [SALES] 0 [TOTAL-REVENUES] (15,031) [CGS] 0 [TOTAL-COSTS] 0 [OTHER-EXPENSES] 5,708 [LOSS-PROVISION] 0 [INTEREST-EXPENSE] 0 [INCOME-PRETAX] (22,204) [INCOME-TAX] 0 [INCOME-CONTINUING] (22,204) [DISCONTINUED] 0 [EXTRAORDINARY] 0 [CHANGES] 0 [NET-INCOME] (22,204) [EPS-BASIC] (0.0019) [EPS-DILUTED] (0.0019) </TABLE>