UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C.  20549





Form
10-Q





(Mark
One)


x
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For
the quarterly period ended September 30, 2009





 ̈
            TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
  ACT





For the
transition period from _______________ to _______________.





Commission
file number 000-53727





United
Mines, Inc.


(Exact
Name of Company as Specified in its Charter)




Arizona
                  (State
      or other jurisdiction of
                  incorporation
      or organization)
                83-0452269
                  (I.R.S.
      Employer
                  Identification
      No.)11924
      N. Centaurus Place
                  Oro
      Valley, AZ
                  (Address
      of principal executive offices)
                85737
                  (Zip
      Code)





(520) 742-3111


(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 Exchange Act 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 x     No
 ̈.





Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if
any, every Interactive Data File required to be submitted and posted pursuant to
Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12
months (or for such shorter period that the registrant was required to submit
and post such files).     Yes x     No
 ̈.





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 definitions of “large
accelerated filer,” “accelerated filer” and “smaller reporting company” in
Rule 12b-2 of the Exchange Act. (Check one):





Large
      accelerated filer   ̈
                      Accelerated
      filer   ̈Non-accelerated
      filer  ̈
                      Smaller
      reporting company x


(Do not
check if a smaller reporting company)





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





Applicable
only to issuers involved in bankruptcy proceedings during the preceding five
years





Check whether the registrant filed all
documents and reports required to be filed by Section 12, 13 or 15(d) of the
Exchange Act after the distribution of securities under a plan confirmed by a
court.


Yes  ̈     No
 ̈.





Applicable
only to corporate issuers:





Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date.  As of November 10, 2009,
there were 10,692,597 shares of common stock, par value $0.001, issued and
outstanding.





UNITED
MINES, INC.





TABLE OF
CONTENTS





PART
      IITEM
      1.
                    Financial
      Statements (unaudited).
                    
                    3ITEM
      2.
                    Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations.
                    
                    19ITEM
      3.
                    Quantitative
      and Qualitative Disclosures About Market Risk.
                    
                    26ITEM
      4T.
                    Controls
      and Procedures.
                    
                    26PART
      IIITEM
      1.
                    Legal
      Proceedings.
                    
                    29ITEM
      1A.
                    Risk
      Factors.
                    
                    29ITEM
      2.
                    Unregistered
      Sales of Equity Securities and Use of Proceeds.
                    
                    30ITEM
      3.
                    Defaults
      Upon Senior Securities.
                    
                    30ITEM
      4.
                    Submission
      of Matters to a Vote of Security Holders.
                    
                    30ITEM
      5.
                    Other
      Information.
                    
                    30ITEM
      6.
                    Exhibits.
                    
                    30


2


PART
I-FINANCIAL INFORMATION





UNITED
      MINES, INC.(A
      Exploration Stage Company)BALANCE
SHEETS





September 30, 2009
                    
                    
                    December 31, 2008(unaudited)
                    
                    
                    (audited)ASSETS:CURRENT
      ASSETSCash
                    
                    $
                    5,467
                    
                    
                    $
                    11,427Prepaid
      expense
                    
                    
                    35,000
                    
                    
                    
                    35,550Total
      current assets
                    
                    
                    40,467
                    
                    
                    
                    46,977PROPERTY
      AND EQUIPMENT, net
                    
                    
                    1,172
                    
                    
                    
                    2,492OTHER
      ASSETSOther
      assets - mining claims
                    
                    
                    100,500
                    
                    
                    
                    100,500Deposit
                    
                    
                    11,000
                    
                    
                    
                    11,000111,500
                    
                    
                    
                    111,500TOTAL
      ASSETS
                    
                    $
                    153,138
                    
                    
                    $
                    160,968LIABILITIES
      AND STOCKHOLDERS' EQUITY:CURRENT
      LIABILITIES:Notes
      payable
                    
                    $
                    35,000
                    
                    
                    $
                    35,000Accounts
      payable
                    
                    
                    -
                    
                    
                    
                    3,756Accrued
      expenses and other liabilities
                    
                    
                    6,109
                    
                    
                    
                    5,112Advances
      from affiliates
                    
                    
                    84,525
                    
                    
                    
                    50,165Total
      current liabilities
                    
                    
                    125,634
                    
                    
                    
                    94,033Total
      liabilities
                    
                    
                    125,634
                    
                    
                    
                    94,033COMMITMENTS
      AND CONTINGENCIES
                    
                    
                    -
                    
                    
                    
                    -STOCKHOLDERS'
      EQUITY:Common
      stock, $.001 par value, 100,000,000 shares authorized;10,692,597
      and 10,642,897 issued and outstanding as ofSeptember
      30, 2009 and December 31, 2008, respectively
                    
                    
                    10,694
                    
                    
                    
                    10,643Additional
      paid-in capital
                    
                    
                    3,930,494
                    
                    
                    
                    3,814,544Accumulated
      deficit during this exploration stage
                    
                    
                    (3,913,684
                    )
                    
                    
                    (3,758,251
                    )Total
      stockholders' equity (deficiency)
                    
                    
                    27,505
                    
                    
                    
                    66,936TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
                    
                    $
                    153,138
                    
                    
                    $
                    160,968





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


3





UNITED
      MINES, INC.(A
      Exploration Stage Company)STATEMENTS OF OPERATIONS -
      (unaudited)





For
      the Periodfrom
      August 20, 1999Three Months Ended
                  
                  
                  Nine Months Ended
                  
                  
                  (inception)
      through2009
                  
                  
                  2008
                  
                  
                  2009
                  
                  
                  2008
                  
                  
                  September 30, 2009REVENUES:Revenues
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -OPERATING
      EXPENSES:General
      and administrative expenses
                  
                  
                  54,543
                  
                  
                  
                  39,337
                  
                  
                  
                  96,421
                  
                  
                  
                  356,804
                  
                  
                  
                  3,792,665Sales
      and marketing expenses
                  
                  
                  2,030
                  
                  
                  
                  889
                  
                  
                  
                  3,826
                  
                  
                  
                  9,286
                  
                  
                  
                  52,526Depreciation
      and amortization
                  
                  
                  440
                  
                  
                  
                  88
                  
                  
                  
                  1,320
                  
                  
                  
                  616
                  
                  
                  
                  4,111Exploration
      expenses
                  
                  
                  20,460
                  
                  
                  
                  -
                  
                  
                  
                  51,247
                  
                  
                  
                  
                  
                  
                  
                  51,247Total
      operating expenses
                  
                  
                  77,473
                  
                  
                  
                  40,314
                  
                  
                  
                  152,813
                  
                  
                  
                  366,706
                  
                  
                  
                  3,900,548OPERATING
      LOSS
                  
                  
                  (77,473
                  )
                  
                  
                  (40,314
                  )
                  
                  
                  (152,813
                  )
                  
                  
                  (366,706
                  )
                  
                  
                  (3,900,548
                  )OTHER
      INCOME (EXPENSE):Interest
      expense
                  
                  
                  (882
                  )
                  
                  
                  (3,062
                  )
                  
                  
                  (2,618
                  )
                  
                  
                  (9,187
                  )
                  
                  
                  (13,135
                  )TOTAL
      OTHER INCOME (EXPENSE)NET
      LOSS
                  
                  $
                  (78,355
                  )
                  
                  $
                  (43,376
                  )
                  
                  $
                  (155,432
                  )
                  
                  $
                  (375,893
                  )
                  
                  $
                  (3,913,684
                  )NET
      INCOME PER SHARE:Basic
      and diluted:
                  
                  $
                  (0.01
                  )
                  
                  $
                  (0.00
                  )
                  
                  $
                  (0.01
                  )
                  
                  $
                  (0.04
                  )Weighted
      average of number of shares outstanding
                  
                  
                  10,659,104
                  
                  
                  
                  10,614,147
                  
                  
                  
                  10,648,359
                  
                  
                  
                  10,401,102





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


4





UNITED
      MINES, INC(
      A Exploration Stage Company)STATEMENTS OF CASH FLOWS -
      (unaudited)





For
      the Periodfrom
      August 20, 1999Nine Months Ended
                  
                  
                  (inception)
      to2009
                  
                  
                  2008
                  
                  
                  September 30, 2009CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      Loss
                  
                  $
                  (155,432
                  )
                  
                  $
                  (375,893
                  )
                  
                  $
                  (3,913,684
                  )Adjustments
      to reconcile net loss to net cash (used in) operating
      activities:Depreciation
      and amortization
                  
                  
                  1,320
                  
                  
                  
                  616
                  
                  
                  
                  4,111Amortization
      of conversion feature
                  
                  
                  -
                  
                  
                  
                  6,562
                  
                  
                  
                  8,750Common
      stock issued for compensation
                  
                  
                  13,001
                  
                  
                  
                  226,715
                  
                  
                  
                  3,379,830Changes
      in assets and liabilities:Accounts
      payable
                  
                  
                  -
                  
                  
                  
                  (1,375
                  )
                  
                  
                  3,757Accrued
      liabilities
                  
                  
                  (2,209
                  )
                  
                  
                  4,246
                  
                  
                  
                  2,912Net
      cash used in operating activities
                  
                  
                  (143,320
                  )
                  
                  
                  (139,129
                  )
                  
                  
                  (514,324
                  )CASH
      FLOWS FROM INVESTING ACTIVITIES:Deposit
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (11,000
                  )Purchase
      of Intangible Asset
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (5,784
                  )Net
      cash used in investing activities
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (16,784
                  )CASH
      FLOWS FROM FINANCING ACTIVITIES:Advances
      from affiliates
                  
                  
                  34,360
                  
                  
                  
                  3,000
                  
                  
                  
                  97,600Advances
      to affiliates
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (13,075
                  )Repayments
      of advances to affiliates
                  
                  
                  -
                  
                  
                  
                  (13,640
                  )
                  
                  
                  -Proceeds
      from the issuance of common stock
                  
                  
                  103,000
                  
                  
                  
                  98,050
                  
                  
                  
                  452,050Net
      cash provided by financing activities
                  
                  
                  137,360
                  
                  
                  
                  87,410
                  
                  
                  
                  536,575-INCREASE
      IN CASH
                  
                  
                  (5,960
                  )
                  
                  
                  (51,719
                  )
                  
                  
                  5,467CASH,
      BEGINNING OF PERIOD
                  
                  
                  11,427
                  
                  
                  
                  52,089
                  
                  
                  
                  -CASH,
      END OF PERIOD
                  
                  $
                  5,467
                  
                  
                  $
                  370
                  
                  
                  $
                  5,467SUPPLEMENTAL
      CASH FLOW INFORMATION:Interest
      paid
                  
                  $
                  2,618
                  
                  
                  $
                  -
                  
                  
                  $
                  -Taxes
      paid
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -





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


5
  UNITED
MINES, INC.
 NOTES
TO CONDENSED  FINANCIAL STATEMENTS
 FOR
THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008
 
 NOTE 1 - DESCRIPTION OF
BUSINESS
 
 The
Company was incorporated under the laws of the State of Arizona on August 20,
1999 ("Inception date") as Plae, Inc. to engage in the exploration of gold and
silver mining properties The Company has a calendar year end for reporting
purposes. The Company is in the process of acquiring mineral properties or
claims located in the State of Arizona, USA. The recoverability of amounts from
the properties or claims will be dependent upon the discovery of economically
recoverable reserves, confirmation of the Company's interest in the underlying
properties and/or claims, the ability of the Company to obtain necessary
financing to satisfy the expenditure requirements under the property and/or
claim agreements and to complete the development of the properties and/or
claims, and upon future profitable production or proceeds for the sale thereof.
The name was changed on February 18, 2005 to King Mines, Inc. and then
subsequently changed to its current name on March 30, 2005. No shares were
issued until the Company became United Mines, Inc. The Company's corporate
office is located at 11924 N Centaurus PI, Oro Valley, AZ 85737.
 
 NOTE 2 - GOING CONCERN
ISSUES
 
 The
accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America which
contemplate continuation of the Company as a going concern.  However,
the Company has sustained losses from operations and no revenues from
operations.  Through September 30, 2009 the Company accumulated a net
loss of $3,913,684.  Further, the Company has inadequate working
capital to maintain or develop its operations, and is dependent upon funds from
private investors and the support of certain stockholders.
 
 These
factors raise substantial doubt about the ability of the Company to continue as
a going concern.  The financial statements do not include any
adjustments that might result from the outcome of these
uncertainties.  In this regard, Management is planning to raise any
necessary additional funds through loans and additional sales of its common
stock. There is no assurance that the Company will be successful in raising
additional capital.
 
 The
Company's ability to meet its obligations and continue as a going concern is
dependent upon its ability to obtain additional financing, achievement of
profitable operations and/or the discovery, exploration, development and sale of
mining reserves. The Company cannot reasonably be expected to earn revenue in
the exploration stage of operations. Although the Company plans to pursue
additional financing, there can be no assurance that the Company will be able to
secure financing when needed or to obtain such financing on terms satisfactory
to the Company, if at all.
 
 6
 
 NOTE 3 - BASIS OF
PRESENTATION
 
 Interim
Financial Statements
  The
accompanying interim unaudited condensed  financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
8 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. In our opinion, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and nine month period ended September
30, 2009 and 2008 are not necessarily indicative of the results that may be
expected for the year ending December 31, 2009. For further information, refer
to the financial statements and footnotes thereto included in our Form 10-K
Report for the fiscal year ended December 31, 2008.
 
 NOTE 4 – SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
 
 The
Company prepares its financial statements in accordance with accounting
principles generally accepted in the United States of
America.  Significant accounting policies are as follows:
 
 Basis of
Presentation
 
 The
Company has produced minimal revenue from its principal business and is an
exploration stage company as defined by the Statement of Financial Accounting
Standards Topic 26 “Accounting and Reporting by Exploration State
Enterprises”.
 
 Use of
Estimates
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements.  These estimates and assumptions also affect
the reported amounts of revenues, costs and expenses during the reporting
period.  Management evaluates these estimates and assumptions on a
regular basis.  Actual results could differ from those
estimates.
 
 Exploration Stage
Enterprise
 
 The
Company's financial statements are prepared pursuant to the provisions of Topic
26, “Accounting for Development Stage Enterprises,” as it devotes substantially
all of its efforts to acquiring and exploring mining interests that will
eventually provide sufficient net profits to sustain the Company’s existence.
Until such interests are engaged in major commercial production, the Company
will continue to prepare its financial statements and related disclosures in
accordance with entities in the development stage.  Mining companies
subject to Topic 26 are required to label their financial statements as an
“Exploratory Stage Company,” pursuant to guidance provided by SEC Guide 7 for
Mining Companies.
 
 7
 
 Revenue
Recognition
 
 As the
Company is continuing exploration of its mineral properties, no significant
revenues have been earned to date. The Company recognizes revenues at the time
of delivery of the product to the customers
 
 Revenue
includes sales value received for our principle product, silver, and associated
by-product revenues from the sale of by-product metals consisting primarily of
gold and copper. Revenue is recognized when title to silver and gold passes to
the buyer and when collectibility is reasonably assured. The passing of title to
the customer is based on terms of the sales contract. Product pricing is
determined at the point revenue is recognized by reference to active and freely
traded commodity markets for example, the London Bullion Market, an active and
freely traded commodity market, for both gold and silver, in an identical form
to the product sold.
 
 Pursuant
to guidance in Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition
for Financial Statements", revenue is recognized when persuasive evidence of an
arrangement exists, delivery has occurred, the price is fixed or determinable,
no obligations remain and collectibility is probable. The passing of title to
the customer is based on the terms of the sales contract. Product pricing is
determined at the point revenue is recognized by reference to active and freely
traded commodity markets, for example the London Bullion Market for both gold
and silver, in an identical form to the product sold.
 
 Cash and Cash
Equivalents
 
 The
Company considers all highly liquid investments with an original maturity of
year ended or less to be cash equivalents.  Cash equivalents include
cash on hand and cash in the bank.
 
 Property and
Equipment
 
 Property
and equipment is recorded at cost and depreciated over the estimated useful
lives of the assets using principally the straight-line method. When items are
retired or otherwise disposed of, income is charged or credited for the
difference between net book value and proceeds realized
thereon.  Ordinary maintenance and repairs are charged to expense as
incurred, and replacements and betterments are capitalized.
 
 The range
of estimated useful lives used to calculated depreciation for principal items of
property and equipment are as follow:
 
 Asset
      Category
                    
                    Depreciation/
                      Amortization
      PeriodFurniture
      and Fixture
                    
                    3
      YearsOffice
      equipment
                    
                    3
      YearsLeasehold
      improvements
                    
                    5
      Years
 
 Mine Exploration and
Development Costs
 
 All
exploration costs are expensed as incurred. Mine development costs are
capitalized after proven and probable reserves have been identified.
 Amortization is calculated using the units-of-production method over the
expected life of the operation based on the estimated recoverable mineral
ounces.
  8
  Mineral
Properties
 
 Significant
payments related to the acquisition of mineral properties, mineral rights, and
mineral leases are capitalized.  If a commercially mineable ore body is
discovered, such costs are amortized when production begins using the
units-of-production method based on proven and probable reserves. If no
commercially mineable ore body is discovered, or such rights are otherwise
determined to have no value, such costs are expensed in the period in which it
is determined the property has no future economic value.
 
 Property
Evaluations
 
 Management
of the Company will periodically review the net carrying value of its properties
on a property-by-property basis. These reviews will consider the net realizable
value of each property to determine whether a permanent impairment in value has
occurred and the need for any asset write-down. An impairment loss will be
recognized when the estimated future cash flows (undiscounted and without
interest) expected to result from the use of an asset are less than the carrying
amount of the asset.  Measurement of an impairment loss will be based on
the estimated fair value of the asset if the asset is expected to be held and
used.
 
 Although
management will make its best estimate of the factors that affect net realizable
value based on current conditions, it is reasonably possible that changes could
occur in the near term which could adversely affect management's estimate of net
cash flows expected to be generated from its assets, and necessitate asset
impairment write-downs.
 
 Reclamation and Remediation
Costs (Asset Retirement Obligations)
 
 The
Company had no operating properties at September 30, 2009, but the Company’s
mineral properties will be subject to standards for mine reclamation that are
established by various governmental agencies. For these non-operating
properties, the Company accrues costs associated with environmental remediation
obligations when it is probable that such costs will be incurred and they are
reasonably estimable. Costs of future expenditures for environmental remediation
are not discounted to their present value. Such costs are based on management's
current estimate of amounts that are expected to be incurred when the
remediation work is performed within current laws and regulations.
 
 It is
reasonably possible that due to uncertainties associated with defining the
nature and extent of environmental contamination, application of laws and
regulations by regulatory authorities, and changes in remediation technology,
the ultimate cost of remediation and reclamation could change in the future. The
Company continually reviews its accrued liabilities for such remediation and
reclamation costs as evidence becomes available indicating that its remediation
and reclamation liability has changed.
  The
Company recognizes the fair value of a liability for an asset retirement
obligation in the period in which it is incurred, if a reasonable estimate of
fair value can be made.  The associated asset retirement costs are
capitalized as part of the carrying amount of the associated long-lived assets
and depreciated over the lives of the assets on a units-of-production basis.
 Reclamation costs are accreted over the life of the related assets and are
adjusted for changes resulting from the passage of time and changes to either
the timing or amount of the original present value estimate on the underlying
obligation.
  9
  Mineral Property
Rights
 
 All
direct costs related to the acquisition of mineral property rights are
capitalized. Exploration costs are charged to operations in the period incurred
until such time as it has been determined that a property has economically
recoverable reserves, at which time subsequent exploration costs and the costs
incurred to develop a property are capitalized.
 
 The
Company reviews the carrying values of its mineral property rights whenever
events or changes in circumstances indicate that their carrying values may
exceed their estimated net recoverable amounts. An impairment loss is recognized
when the carrying value of those assets is not recoverable and exceeds its fair
value. As of September 30, 2009, management has determined that no impairment
loss is required.
 
 At such
time as commercial production may commence, depletion of each mining property
will be provided on a unit-of-production basis using estimated proven and
probable recoverable reserves as the depletion base. In cases where there are no
proven or probable reserves, depletion will be provided on the straight-line
basis over the expected economic life of the mine.
 
 Asset Retirement
Obligations
 
 The
Company plans to recognize liabilities for statutory, contractual or legal
obligations, including those associated with the reclamation of mineral and
mining properties and any plant and equipment, when those obligations result
from the acquisition, construction, development or normal operation of the
assets. Initially, a liability for an asset retirement obligation will be
recognized at its fair value in the period in which it is incurred. Upon initial
recognition of the liability, the corresponding asset retirement cost will be
added to the carrying amount of the related asset and the cost will be amortized
as an expense over the economic life of the asset using either the
unit-of-production method or the straight-line method, as appropriate. Following
the initial recognition of the asset retirement obligation, the carrying amount
of the liability will be increased for the passage of time and adjusted for
changes to the amount or timing of the underlying cash flows needed to settle
the obligation.
 
 The
Company has posted reclamation bonds with the State of Arizona Reclamation Bond
Pool for its properties as required by the United States Bureau of Land
Management, to secure potential clean-up and land restoration costs if the
projects were to be abandoned or closed. The Company has recorded the cost of
these bonds as an asset in the accompanying balance sheets.
 
 Impairment of Long-Lived
Assets
 
 In
accordance with ASC Topic 360, long-lived assets, such as
property, plant, and equipment, and purchased intangibles, are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. Goodwill and other
intangible assets are tested for impairment annually. Recoverability of assets
to be held and used is measured by a comparison of the carrying amount of an
asset to estimated undiscounted future cash flows expected to be generated by
the asset. If the carrying amount of an asset exceeds its estimated future cash
flows, an impairment charge is recognized by the amount by which the carrying
amount of the asset exceeds the fair value of the asset.  There were
no events or changes in circumstances that necessitated an impairment of long
lived assets.
  10
  Income
Taxes
 
 Deferred
income taxes are provided based on the provisions of ASC Topic 740, "Accounting for Income Taxes",
to reflect the tax consequences in future years of differences between the tax
bases of assets and liabilities and their financial reporting amounts based on
enacted tax laws and statutory tax rates applicable to the periods in which the
differences are expected to affect taxable income.  Valuation
allowances are established when necessary to reduce deferred tax assets to the
amount expected to be realized.
 
 The
Company adopted the provisions of ASC Topic 740; "Accounting For Uncertainty In
Income Taxes-An Interpretation Of ASC Topic 740 ("Topic 740").  Topic
740 contains a two-step approach to recognizing and measuring uncertain tax
positions.  The first step is to evaluate the tax position for
recognition by determining if the weight of available evidence indicates it is
more likely than not, that the position will be sustained on audit, including
resolution of related appeals or litigation processes, if any. The second step
is to measure the tax benefit as the largest amount, which is more than 50%
likely of being realized upon ultimate settlement.  The Company
considers many factors when evaluating and estimating the Company's tax
positions and tax benefits, which may require periodic adjustments. At September
30, 2009, the Company did not record any liabilities for uncertain tax
positions.
 
 Concentration of Credit
Risk
 
 The
Company maintains its operating cash balances in banks in Oro Valley,
Arizona.  The Federal Depository Insurance Corporation (FDIC) insures
accounts at each institution up to $250,000.
 
 Share-Based
Compensation
 
 The
Company applies Topic 718 “Share-Based Payments” (“Topic 718”) to share-based
compensation, which requires the measurement of the cost of services received in
exchange for an award of an equity instrument based on the grant-date fair value
of the award.  Compensation cost is recognized when the event occurs.
 The Black-Scholes option-pricing model is used to estimate the fair value
of options granted.
 
 Basic and Diluted Net Loss
Per Share
 
 Net loss
per share was computed by dividing the net loss by the weighted average number
of common shares outstanding during the period.  The weighted average
number of shares was calculated by taking the number of shares outstanding and
weighting them by the amount of time that they were outstanding.  Diluted
net loss per share for the Company is the same as basic net loss per share, as
the inclusion of common stock equivalents would be antidilutive.  At
September 30, 2009 the common stock equivalents consisted of no options and no
common stock warrants.
 
 Fair Value of Financial
Instruments
  The fair
value of a financial instrument is the amount at which the instrument could be
exchanged in a current transaction between willing parties other than in a
forced sale or liquidation.
 
 11
 
 The
carrying amounts of the Company’s financial instruments, including cash,
accounts payable and accrued liabilities, income tax payable and related party
payable approximate fair value due to their most maturities.
 
 Reclassifications
  Certain
prior year amounts have been reclassified to conform to the current period
presentation for comparative purposes.
 
 Recent Accounting
Pronouncements
 
 Recent
accounting pronouncements that the Company has adopted or that will be required
to adopt in the future are summarized below.
 
 In
September 2009, Accounting Standards Codification (“ASC”) became the source
of authoritative U.S. GAAP recognized by the Financial Accounting Standards
Board (“FASB”) for nongovernmental entities, except for certain FASB Statements
not yet incorporated into ASC. Rules and interpretive releases of the SEC under
federal securities laws are also sources of authoritative U.S. GAAP for
registrants. The discussion below includes the applicable ASC
reference.
 
 The
Company adopted ASC Topic 810-10 Consolidation(formerly SFAS
No. 160, Noncontrolling
Interests in Consolidated  Financial Statements – an amendment of ARB
No. 51) effective January 2, 2009. Topic 810-10 changes
the manner of presentation and related disclosures for the noncontrolling
interest in a subsidiary (formerly referred to as a minority interest) and
for the deconsolidation of a subsidiary. The presentation changes are
reflected retrospectively in the Company’s unaudited condensed consolidated
financial statements.
 
 ASC Topic
815-10 Derivatives and
Hedging (formerly SFAS No. 161, Disclosures about Derivative
Instruments and Hedging Activities) was adopted by the Company effective
January 2, 2009. The guidance under Topic 815-10 changes the manner of
presentation and related disclosures of the fair values of derivative
instruments and their gains and losses.
 
 The
Company adopted ASC Topic 825-10 Financial Instruments
(formerly, FASB Staff Position No. SFAS 107-1 and APB No. 28-1, Disclosures about the Fair Value of
Financial Instruments), which requires quarterly disclosure of
information about the fair value of financial instruments within the scope of
Topic 825-10. The Company adopted this pronouncement effective April 1,
2009.
 
 In April
2009, the Company adopted ASC Topic 820-10-65 Fair Value Measurements and
Disclosures (formerly FASB Staff Position No. SFAS 157-4, Determining Fair Value When the
Volume and Level of Activity for the Asset or Liability Have Significantly
Decreased and Identifying Transactions That Are Not Orderly).The standard provides
additional guidance for estimating fair value in accordance with Topic 820-10-65
when the volume and level of activity for the asset or liability have
significantly decreased and includes guidance on identifying circumstances that
indicate if a transaction is not orderly. The Company adopted this pronouncement
effective April 1, 2009 with no impact on its  financial
statements.
 
 The
Company adopted, ASC Topic 855-10 Subsequent Events(formerly
SFAS 165, Subsequent
Events) effective April 1, 2009. This pronouncement changes the
general standards of accounting for and disclosure of events that occur after
the balance sheet date but before financial statements are issued or are
available to be issued.
  12
  In June
2009, the FASB finalized SFAS No. 167, Amending FASB interpretation
No. 46(R),which was included in ASC Topic 810.The provisions of ASC
810 amend the definition of the primary beneficiary of a variable interest
entity and will require the Company to make an assessment each reporting period
of its variable interests. The provisions of this pronouncement are effective
January 1, 2010. The Company is evaluating the impact of the statement on
its  financial statements.
 
 In July
2009, the FASB issued SFAS No. 168, The Hierarchy of Generally Accepted
Accounting Principles. SFAS 168 codified all previously issued accounting
pronouncements, eliminating the prior hierarchy of accounting literature, in a
single source for authoritative U.S. GAAP recognized by the FASB to be applied
by nongovernmental entities. SFAS 168, now ASC Topic 105-10 Generally Accepted Accounting
Principles, is effective for financial statements issued for interim and
annual periods ending after September 15, 2009. The adoption of this
pronouncement did not have an effect on the  financial
statements.
 
 Updates issued but not yet
adopted
 
 In August
2009, the FASB issued Accounting Standards Update (“ASU”) No. 2009-05,
Measuring Liabilities at Fair
Value, which clarifies, among other things, that when a quoted price in
an active market for the identical liability is not available, an entity must
measure fair value using one or more specified techniques. The Company adopted
the pronouncement effective July 1, 2009 with no impact on
its  financial statements.
 
 In
October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable Revenue
Arrangements, which revises the existing multiple-element revenue
arrangements guidance and changes the determination of when the individual
deliverables included in a multiple-element revenue arrangement may be treated
as separate units of accounting, modifies the manner in which the transaction
consideration is allocated across the separately identified deliverables and
expands the disclosures required for multiple-element revenue arrangements. The
pronouncement is effective for financial statements issued after
December 31, 2010. The Company does not expect the pronouncement to have a
material effect on its  financial statements.
 
 NOTE 5 - PROPERTY AND
EQUIPMENT
 
 The
Company has fixed assets as of September 30, 2009 and December 31, 2008 as
follows:
 
 June 30, December 31,2009
                        
                        
                        2008Equipment
                        
                        $
                        5,282
                        
                        
                        $
                        5,282Accumulated
      depreciation
                        
                        
                        (4,110
                        )
                        
                        
                        (2,790
                        )Total
                        
                        $
                        1,172
                        
                        
                        $
                        2,492
  13
  NOTE 6 – PURCHASE OF MINING
RIGHTS
 
 On
October 1, 2005 the Company purchased 23 mining claims and related assets from
two then unrelated third parties in exchange for 3,600,000 common
shares.  Since the sellers did not obtain majority ownership of the
Company in the transaction it was accounted for as a purchase rather than a
reverse merger.
 
 According
to the SEC SAB Topic 5G, “transfers of nonmonetary assets to a company by its
promoters or shareholders in exchange for stock prior to the company’s initial
public offering normally should be recorded at the transferor’s historic cost
basis determined under GAAP.”  Since the sellers were unable to
determine and document their historic cost as determined under GAAP, management
elected to record the purchase at an investment of $100,000, the estimated scrap
value of the equipment.
 
 Additionally,
according to the SEC, Issues in Extractive Industries No. 1 “Recoverability of
capitalized costs is likely to be insupportable under FASB 944 prior to
determining the existence of a commercially minable deposit, as contemplated by
Industry Guide 7 for a mining company in the exploration stage.  As a
result, the staff would generally challenge capitalization of exploration costs,
and believes that those costs should be expensed as incurred during the
exploration state under US GAAP.”
 
 NOTE 7 – SHARE
CAPITAL
 
 On August
20, 1999 the Company authorized 1,000,000 and amended is Articles of
Incorporation in 2006 to authorize 100,000,000 shares of common stock, at $.001
par value, and 10,692,597 are issued and outstanding as of September 30,
2009
 
 During
the nine months ended September 30, 2009, the Company issued 41,200 shares of
common stock for $103,000.  The company issued 5,500 for payment of
debt and 3,000 common stock for compensation to consultants for the fair value
of the services rendered.  The value of those shears is determined
based on the value of the stock at the dates on which the agreements were
entered into for services and the value of the services rendered.
 
 NOTE 8 – COMMITMENTS AND
CONTINGENCIES
 
 The
Company may enter into various consulting agreements with outside consultants.
Certain of these agreements may include additional compensation on the basis of
performance.
 
 NOTE 9 – NOTES
PAYABLE
 
 On
December 7, 2007 the Company issued a 10% note payable to the Lebrecht Group, PC
for services rendered related to the registration of certain securities of the
Company.  The note and accrued interest were due December 7, 2008 and
at the option of the holder payable in full on the maturity date or in 12
monthly payments beginning on the maturity date.  The note and accrued
interest are convertible to common shares at any time at the option of the
holder at 75% of the average closing bid price on the five trading days
immediately preceding the conversion.  Management estimates that
20,000 shares may be issued if this conversion feature is
exercised.
  14
  In
accordance with generally accepted accounting principles, the 25% discount to
market related to the conversion feature has been reported as a component of
additional paid in capital.  Additionally, since this represents a
prepayment for services related to a future public offering, management has
elected to offset the cost to future capital raised as a result of the offering,
if any.
 
 NOTE 10 - INCOME
TAXES
 
 The
provision (benefit) for income taxes from continued operations for the nine
months ended September 30, 2009 and 2008 consist of the following:
  September 30,2009
                      
                      
                      2008Current:Federal
                      
                      $
                      -
                      
                      
                      $
                      -State
                      
                      
                      -
                      
                      
                      
                      --
                      
                      
                      
                      -Deferred:Federal
                      
                      $
                      24,243
                      
                      
                      $
                      34,878State
                      
                      
                      7,052
                      
                      
                      
                      10,14631,295
                      
                      
                      
                      45,024Benefit
      from the operating loss carryforward
                      
                      
                      (31,295
                      )
                      
                      
                      (45,024
                      )(Benefit)
      provision for income taxes, net
                      
                      $
                      -
                      
                      
                      $
                      -
  15
  The
difference between income tax expense computed by applying the federal statutory
corporate tax rate and actual income tax expense is as follows:
  September 30,2009
                      
                      
                      2008Statutory
      federal income tax rate
                      
                      
                      34.0
                      %
                      
                      
                      34.0
                      %State
      income taxes and other
                      
                      
                      8.9
                      %
                      
                      
                      8.9
                      %Valuation
      Allowance
                      
                      
                      (42.9
                      )%
                      
                      
                      (42.9
                      )%Effective
      tax rate
                      
                      
                      -
                      
                      
                      
                      -
  Deferred
income taxes result from temporary differences in the recognition of income and
expenses for the financial reporting purposes and for tax purposes. The tax
effect of these temporary differences representing deferred tax asset and
liabilities result principally from the following:
  September 30,2009
                      
                      
                      2008Net
      operating loss carryforward
                      
                      
                      31,295
                      
                      
                      
                      45,024Valuation
      allowance
                      
                      
                      (31,295
                      )
                      
                      
                      (45,024
                      )Deferred
      income tax asset
                      
                      $
                      -
                      
                      
                      $
                      -
  The
Company has a net operating loss carryforward of approximately $3,913,684
available to offset future taxable income through 2028.
 
 The
Company recognized an income tax provision of $31,295 and $45,024 for the nine
months ended September 30, 2009 and 2008, respectively, despite losses before
taxes. The year-to-date provision is primarily due to the recording of a
valuation allowance on the Company’s U.S. deferred tax assets as of September
30, 2009. The valuation allowance was recorded at the end of the third quarter
of 2009 to reduce certain U.S. federal and state net deferred tax assets to
their anticipated realizable value.
  16
  ASC 740
requires the consideration of a valuation allowance to reflect the likelihood of
realization of deferred tax assets. Significant management judgment is required
in determining any valuation allowance recorded against deferred tax assets. In
evaluating the ability to recover deferred tax assets, the Company considered
available positive and negative evidence, giving greater weight to its recent
cumulative losses and its ability to carry-back losses against prior taxable
income and lesser weight to its projected financial results due to the
challenges of forecasting future periods. The Company also considered,
commensurate with its objective verifiability, the forecast of future taxable
income including the reversal of temporary differences. The Company performed
this evaluation as of the year ended December 31, 2008 and the quarters ended
March 31, 2009 and June 30, 2009. At that time the Company determined that a
valuation allowance was required. At the end of the quarter ended September 30,
2009, changes in previously anticipated expectations and continued operating
losses necessitated a valuation allowance against the tax benefits recognized in
this quarter and prior quarters since they are no longer “more-likely-than-not”
realizable. Under current tax laws, this valuation allowance will not limit the
Company’s ability to utilize U.S. federal and state deferred tax assets provided
it can generate sufficient future taxable income in the U.S.
  The
Company anticipates it will continue to record a valuation allowance against the
losses of certain jurisdictions, primarily federal and state, until such time as
we are able to determine it is “more-likely-than-not” the deferred tax asset
will be realized. Such position is dependent on whether there will be sufficient
future taxable income to realize such deferred tax assets The Company’s
effective tax rate may vary from period to period based on changes in estimated
taxable income or loss by jurisdiction, changes to the valuation allowance,
changes to federal, state or foreign tax laws, future expansion into areas with
varying country, state, and local income tax rates, deductibility of certain
costs and expenses by jurisdiction.
  NOTE 11– LOSSES PER
SHARE
 
 The
following table represents the computation of basic and diluted losses per share
at September 30, 2009 and 2008:
 
 September
      30,
                    
                    
                    September
      30,2009
                    
                    
                    2008Losses
      available for common shareholders
                    
                    
                    (78,355
                    )
                    
                    
                    (112,728
                    )Basic
      weighted average common shares outstanding
                    
                    
                    (0.01
                    )
                    
                    
                    (0.04
                    )Basic
      and Fully Diluted loss per share
                    
                    
                    10,648,359
                    
                    
                    
                    10,174,797
 
 Net loss
per share is based upon the weighted average shares of common stock
outstanding
 
 NOTE 12 - COMMITMENTS AND
CONTINGENCIES
 
 The
Company may enter into various consulting agreements with outside consultants.
Certain of these agreements may include additional compensation on the basis of
performance.
 
 17
 
 NOTE 13 – RELATED PARTY
TRANSACTIONS
 
 The
Company is managed by its key shareholders who are also officers and directors
of the Company.  The balance of notes payable to our key shareholders
for cash advanced to the Company for the nine months ended September 30, 2009 is
$84,525 and $50,165 at December 31, 2008.  These advances do not
convert to common stock and they are non interest bearing advances.
 
 An entity
affiliated with two of the shareholders provides office space and other support
on a month to month basis.  The entity has been reimbursed with both
stock and cash.
 
 NOTE 14 – SUBSEQUENT
EVENTS
 
 Effective
on September 25, 2009, we entered into a Securities Purchase Agreement with a
single non-affiliate investor to purchase (i) 60,000 shares of our commons
stock, and (ii) warrants to buy another 100,000 shares of our common stock at
$2.50 per share, in exchange for aggregate consideration of
$150,000.  The purchase will take place in three different closings on
the 10th of each of October, November, and December 2009.  The
warrants will vest on the first closing.  The first payment was made
in early October.  The issuance was exempt from registration pursuant
to Section 4(2) of the Securities Act of 1933, and the investor was
accredited.
 
 *  *  *  *  *  *  *  *  *
  18





ITEM 2.  Management’s Discussion and Analysis
of Financial Condition and Results of Operations.





This
quarterly report on Form 10-Q of United Mines, Inc. (referred to herein as
“UMI”, “we,” “us” or “Company”) for the three months ended September 30, 2009,
contains forward-looking statements, principally in this Section and “Business.”
Generally, you can identify these statements because they use words like
“anticipates,” “believes,” “expects,” “future,” “intends,” “plans,” and similar
terms. These statements reflect only our current expectations. Although we do
not make forward-looking statements unless we believe we have a reasonable basis
for doing so, we cannot guarantee their accuracy and actual results may differ
materially from those we anticipated due to a number of uncertainties, many of
which are unforeseen, including, among others, the risks we face as described in
this filing. You should not place undue reliance on these forward-looking
statements which apply only as of the date of this quarterly report. These
forward-looking statements are within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, and are intended to be covered by the safe harbors
created thereby. To the extent that such statements are not recitations of
historical fact, such statements constitute forward-looking statements that, by
definition, involve risks and uncertainties. In any forward-looking statement
where we express an expectation or belief as to future results or events, such
expectation or belief is expressed in good faith and believed to have a
reasonable basis, but there can be no assurance that the statement of
expectation of belief will be accomplished.





We
believe it is important to communicate our expectations to our investors. There
may be events in the future, however, that we are unable to predict accurately
or over which we have no control. The risk factors listed in this filing, as
well as any cautionary language in our annual report on Form 10-K, provide
examples of risks, uncertainties and events that may cause our actual results to
differ materially from the expectations we describe in our forward-looking
statements. Factors that could cause actual results or events to differ
materially from those anticipated, include, but are not limited to: our ability
to successfully develop new products; the ability to obtain financing for
product development; changes in product strategies; general economic, financial
and business conditions; changes in and compliance with governmental healthcare
and other regulations; changes in tax laws; and the availability of key
management and other personnel.





Overview





We were
originally incorporated under the name Plae, Inc., in the State of Arizona on
August 20, 1999.  At the time we operated under the name Plae, Inc.,
no business was conducted.  No books or records were maintained and no
meetings were held.   In essence, nothing was done after
incorporation until Glenn E. Martin took possession of Plae, Inc.  On
February 18, 2005, the corporate name was changed to King Mines, Inc. and then
subsequently changed to its current name, United Mines, Inc., on March 30,
2005.  No shares were issued until the company became United Mines,
Inc.




19




We are an
exploration stage mineral exploration company and have been in the mining
industry since January 2005, when we began doing business in the mining
industry.  An exploration stage company is one engaged in the search
for mineral deposits or reserves which are not in either the development or
production stage.  We currently own four groups of mining
claims.  These groups include one primary silver exploration stage
mining project, seven gold exploration stage mining projects, three copper
exploration stage projects, and one placer gold exploration stage project, all
in Arizona, USA.  To date we have no assurance that commercially
viable mineral deposits exist on any of the properties we own or where we have
mineral rights. Further exploration, at a significant cost to us, will be
required before a final evaluation as to the economic and legal feasibility of
the properties is determined.  If this evaluation determines that some
of the properties do have mineral deposits we will have to spend substantial
funds for their drilling and engineering studies before we will know if we have
a commercially viable mineral deposit (a reserve).  We obtained our
properties as follows:





In
October, 2005, we contracted with Glynn A. Burkhardt and Glynn G. Burkhardt, our
current Senior Vice President and our former Emeritus Chairman of the Board,
respectively, to transfer the rights and interests they held in 23 mining claim
to us, by quitclaim deed, in exchange for 3,600,000 shares of our common
stock.  These rights and interests were actually transferred to us in
June 2006 (See Exhibit 10.4 Quitclaim Deeds).





In March
and April 2006, we obtained 3 state “exploration permits” from the state of
Arizona, which are renewable on an annual basis for a maximum of 5
years.  The “exploration permits” are the precursor to obtaining a
lease from the state, but leases cannot be obtained until we either conduct
exploration for a year on the properties or show economic
feasibility.





During
2006, we acquired 69 additional unpatented mining claims on BLM land, including
the 9 claims that make up the Blue Copper mining property.





As a
result of these acquisitions, we currently own four groups of mining
claims.  These groups include one primary silver exploration stage
mining project, seven gold exploration stage mining projects, three copper
exploration stage projects, and one placer gold exploration stage project, all
in Arizona, USA.





Our four
groups of mining claims include 89 Unpatented Bureau of Land Management
(BLM) mining claims in Southern Arizona, USA, totaling 1,840
acres.  These claims are renewable annually for $140 per claim and
currently paid through August 31, 2009.  (See Exhibit 99.1 Mining
Claim Ledger for both our 38 material mining claims and our 54 non-material
mining claims).





In
addition to the unpatented mining claims, we own three Arizona State Land
Department (ASLD) Mineral Exploration Permits, Nos. 08-110135, 08-110136 and
08-110137, each of which are each good for 5 years, currently thru April 13,
2011.  This Arizona state land department position totals 1,920 acres
of land.  These are renewable annually, at $2.00 per acre for year
one, no charge per acre for the second year, and $1.00 per acre for years 3-5,
plus a $500 renew application fee.  This fee had been paid thru April
13, 2010. (Exhibit 99.2 ASLD Mineral Exploration Permits).





For a
full description of the properties where we have mineral rights see Amendment
No. 4 to our Registration Statement on Form S-1 filed with the Commission on
June 5, 2009.




20




Critical
Accounting Policies





We
prepare our consolidated financial statements in accordance with accounting
principles generally accepted in the United States of America. The preparation
of these financial statements requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period. Our
management periodically evaluates the estimates and judgments made. Management
bases its estimates and judgments on historical experience and on various
factors that are believed to be reasonable under the circumstances. Actual
results may differ from these estimates as a result of different assumptions or
conditions.





Accounting Policies and
Estimates





The
preparation of our financial statements in conformity with accounting principles
generally accepted in the United States of America requires our management to
make certain estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period.  Our management periodically
evaluates the estimates and judgments made. Management bases its estimates and
judgments on historical experience and on various factors that are believed to
be reasonable under the circumstances. Actual results may differ from these
estimates as a result of different assumptions or conditions.





As such,
in accordance with the use of accounting principles generally accepted in the
United States of America, our actual realized results may differ from
management’s initial estimates as reported.  A summary of significant
accounting policies are detailed in notes to the financial statements which are
an integral component of this filing.





Revenue
Recognition





As the
Company is continuing exploration of its mineral properties, no significant
revenues have been earned to date. The Company recognizes revenues at the time
of delivery of the product to the customers.  Revenue includes sales
value received for our principle product, silver, and associated by-product
revenues from the sale of by-product metals consisting primarily of gold and
copper. Revenue is recognized when title to silver and gold passes to the buyer
and when collectibility is reasonably assured. The passing of title to the
customer is based on terms of the sales contract. Product pricing is determined
at the point revenue is recognized by reference to active and freely traded
commodity markets for example, the London Bullion Market, an active and freely
traded commodity market, for both gold and silver, in an identical form to the
product sold.





Pursuant
to guidance in Staff Accounting Bulletin ("SAB") No. 104, "Revenue Recognition
for Financial Statements", revenue is recognized when persuasive evidence of an
arrangement exists, delivery has occurred, the price is fixed or determinable,
no obligations remain and collectibility is probable. The passing of title to
the customer is based on the terms of the sales contract. Product pricing is
determined at the point revenue is recognized by reference to active and freely
traded commodity markets, for example the London Bullion Market for both gold
and silver, in an identical form to the product sold.


21





Results
of Operation for the Three Months Ended September 30, 2009 Compared to the Three
Months Ended September 30, 2008





Results
of Operations





Three Months
                        Ended
                        September 30,
                        2009
                      
                      
                      Three Months
                        Ended
                        September 30,
                        2008Revenue
                      
                      $
                      -
                      
                      
                      $
                      -General
      and Administrative Expenses
                      
                      
                      54,543
                      
                      
                      
                      39,377Sales
      and Marketing Expenses
                      
                      
                      2,030
                      
                      
                      
                      889Exploration
      Expenses
                      
                      
                      20,640
                      
                      
                      
                      -Depreciation
      and Amortization
                      
                      
                      440
                      
                      
                      
                      88Operating
      Loss
                      
                      
                      (77,473
                      )
                      
                      
                      (40,314
                      )Net
      Loss
                      
                      $
                      (78,355
                      )
                      
                      $
                      (43,376
                      )




Revenues





We did not have any revenues for the
three months ended September 30, 2009 or September 30, 2008.  To date
we have funded the business through sales of our common stock and from loans
from our officers and directors.  If we are not successful in raising
funds through the offering described herein, two of our principals, Glenn
Martin, our President, and Nicole Breen, our Secretary and Treasurer, have
committed to put in up to $25,000 per quarter as necessary to pay for our
necessary business expenses for at least the next twelve months.





Total Operating
Expenses





Our total
operating expenses for the three months ended September 30, 2009, consisted of
general and administrative expenses of $54,543, sales and marketing expenses of
$2,030, depreciation and amortization of $440, and exploration expenses of
$20,460.  Our general and administrative expenses consisted of mining
claim maintenance, postage and delivery, transfer agent fees, auto and office
support staff.  Our operating expenses for the three months ended
September 30, 2008, consisted of general and administrative expenses of $39,377,
sales and marketing expenses of $889, and depreciation and amortization expenses
of $88.  We had no exploration expenses during the three months ended
September 30, 2008.  Our general and administrative expenses for the
three months ended September 30, 2008, consisted of mining claim maintenance,
postage and delivery, transfer agent fees, auto and office support
staff.  Our general and administrative expenses for the three months
ended September 30, 2009 were higher than those for the three months ended
September 30, 2008, due to reimbursement for past due amounts to auditor, legal,
accounting, EDGAR services and repayment of debt.




22




Net Income
(Loss)





Our net
loss for the three months ended September 30, 2009 was ($78,355), compared to
($43,376) for the three months ended September 30, 2008.  For the
three months ended September 30, 2009 our net loss consisted of operating losses
of ($77,473) and interest expense of ($882).  For the three months
ended September 30, 2008 our net loss consisted of operating expenses of
($40,314) and interest expense of $3,062.  As noted above, our total
operating expenses for the period ended September 30, 2009, were more than those
for the period ended September 30, 2008, leading
to the difference in our net loss for the two periods.





Results
of Operation for the Nine Months Ended September 30, 2009 Compared to the Nine
Months Ended September 30, 2008





Results
of Operations





Nine Months
                        Ended
                        September 30,
                        2009
                      
                      
                      Nine Months
                        Ended
                        September 30,
                        2008Revenue
                      
                      $
                      -
                      
                      
                      $
                      -General
      and Administrative Expenses
                      
                      
                      96,421
                      
                      
                      
                      356,804Sales
      and Marketing Expenses
                      
                      
                      3,826
                      
                      
                      
                      9,286Exploration
      Expenses
                      
                      
                      51,147
                      
                      
                      
                      -Depreciation
      and Amortization
                      
                      
                      1,320
                      
                      
                      
                      616Operating
      Loss
                      
                      
                      (152,813
                      )
                      
                      
                      (366,706
                      )Net
      Loss
                      
                      $
                      (155,432
                      )
                      
                      $
                      (375,893
                      )




Revenues





We did not have any revenues for the
nine months ended September 30, 2009 or September 30, 2008, nor have we had any
since our inception on August 20, 1999.  To date we have funded the
business through sales of our common stock and from loans from our officers and
directors.  If we are not successful in raising funds through the
offering described herein, two of our principals, Glenn Martin, our President,
and Nicole Breen, our Secretary and Treasurer, have committed to put in up to
$25,000 per quarter as necessary to pay for our necessary business expenses for
at least the next twelve months.





Total Operating
Expenses





Our total
operating expenses for the nine months ended September 30, 2009, consisted of
general and administrative expenses of $96,421, sales and marketing expenses of
$3,826, depreciation and amortization of $1,320, and exploration expenses of
$51,147.  Our general and administrative expenses consisted of legal,
accounting, auditor, EDGAR service fees,mining claim maintenance,
postage and delivery, transfer agent fees, auto and office support
staff.  Our operating expenses for the nine months ended September 30,
2008, consisted of general and administrative expenses of $356,804, sales and
marketing expenses of $9,286, and depreciation and amortization expenses of
$616.  We did not have any exploration expenses during this
period.  Our general and administrative expenses for the nine months
ended September 30, 2008, consisted of mining claim maintenance, postage and
delivery, transfer agent fees, auto and office support staff.  Our
general and administrative expenses for the nine months ended September 30, 2009
were significantly lower than those for the nine months ended September 30,
2008, due to us not issuing stock for services during the period ended September
30, 2009, which we had done during the same period one year
earlier.




23




Net Income
(Loss)





Our net
loss for the nine months ended September 30, 2009 was ($155,432), compared to
($375,893) for the nine months ended September 30, 2008.  For both
periods our net loss consisted entirely of our operating
expenses.  For the nine months ended September 30, 2009 our net loss
consisted of operating losses of ($152,813) and interest expense of
($2,618).  For the nine months ended September 30, 2008 our net loss
consisted of operating expenses of ($366,706) and interest expense of
($9,187).  As noted above, our total operating expenses for the period
ended September 30, 2009, were significantly less than those for the period
ended September 30, 2008, leading
to the difference in our net loss for the two periods.





Liquidity
and Capital Resources





Introduction





During
the nine months ended September 30, 2009 and 2008, we did not generate positive
operating cash flows. Cash totaled $5,467 and $11,427 at September 30, 2009 and
December 31, 2008, respectively.





Our cash,
current assets, total assets, current liabilities, and total liabilities as of
September 30, 2009 and December 31, 2008, respectively, are as
follows:





As of
                  September 30,
                  2009
                
                
                As of
                  December 31, 2008
                
                
                ChangeCash
                
                $
                5,467
                
                
                $
                11,427
                
                
                $
                (5,960
                )Total
      Current Assets
                
                
                40,467
                
                
                
                46,977
                
                
                
                (6,510
                )Total
      Assets
                
                
                153,138
                
                
                
                160,968
                
                
                
                (7,830
                )Total
      Current Liabilities
                
                
                125,634
                
                
                
                94,033
                
                
                
                31,601Total
      Liabilities
                
                $
                125,634
                
                
                $
                94,033
                
                
                $
                31,601





Cash
Requirements





We have very little cash available as
of September 30, 2009.  If we are not successful in raising funds
through the sale of our common stock, two of our principals, Glenn Martin, our
President, and Nicole Breen, our Secretary and Treasurer, have committed to put
in up to $25,000 per quarter as necessary to pay for our necessary business
expenses.  On October 1, 2008, Mr. Martin and Ms. Breen, agreed to
loan us up to $100,000, interest free and unsecured, as needed, during the
twelve months ending September 30, 2009, with any amounts loaned due to be paid
back one year from the date the money is given to us.  As of December
31, 2008, we had $49,600 in advances from Ms. Breen.  From January 1,
2009 to September 30, 2009, Ms. Breen loaned us an additional $25,870 and Mr.
Martin loaned us $20,000, respectively.  As of September 30, 2009, Ms.
Breen has loaned us a total of $84,525.  The loans from Mr. Martin
were repaid during the third quarter.  These loans are pursuant to an
oral agreement between Mr. Martin, Ms. Breen and the company.  This
agreement was ratified by our Board of Directors.  However, we will
require additional capital over and above $25,000 per quarter to get our
business operating at full strength and while we hope to raise this capital with
either a bridge loan or through the sale of our common stock, but we cannot be
assured that such funding will be available.  Ms. Breen and Mr. Martin
have both indicated they would be willing to loan us up to an additional
$250,000 total on similar terms as the existing loans in the event it becomes
necessary.




24




Sources and Uses of
Cash





Operations





We did
not receive any cash from operations for the nine months ended September 30,
2009.  We used ($143,320) in cash for operating activities during this
period, compared to ($139,129) for the same period one year ago.  The
principal components of the increased net cash used in operations for the nine
months ended September 30, 2009 were: (a) a net loss of ($155,432), (b) accrued
liabilities of ($2,209), (c) common stock issued for compensation of $13,001,
and (d) depreciation and amortization of $1,320.  Until our operations
grow we do not anticipate we will generate significant cash from operating
activities.  Until that time we believe this figure will be fairly
indicative our cash generation and cash used for operations in a nine month
period.  Our net cash used in operating activities was ($514,324) for
the period from August 20, 1999 (inception) through September 30,
2009.





Investments





We did not have any provided by (used
in) investing activities for the nine months ended September 30, 2009 or
2008.  For the period from August 20, 1999 (inception) to September
30, 2009, our net cash provided by (used in) investment activities was ($16,784)
and related to the purchase of intangible assets and deposits.





Financing





During the nine months ended September
30, 2009, we had $137,360 in cash provided by financing activities, compared to
$87,410 for the same period one year ago.  For the 2009 period our net
cash provided by financing activities consisted of $103,000 in proceeds from the
issuance of our common stock and $34,360 in advances from
affiliates.  For the 2008 period our net cash provided by financing
activities consisted of $98,050 in proceeds from the issuance of our common
stock and $3,000 in advances from affiliates.  We anticipate that for
the foreseeable future we will have to rely on money raised from the sale of our
stock and from advances from our principals to pay our operating
expenses.





Debt Instruments,
Guarantees, and Related Covenants





We have no disclosure required by
this Item.




25





ITEM
3.           Quantitative
and Qualitative Disclosures about Market Risk.





As a
smaller reporting company we are not required to provide the information
required by this Item. However, we opted to include the following
information.





The only
financial instruments we hold are cash and cash equivalents.





ITEM
4T.        Controls and
Procedures.





(a) Disclosure Controls and
Procedures





We
conducted an evaluation, with the participation of our Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
our disclosure controls and procedures, as defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange
Act, as of September 30, 2009, to ensure that information required to be
disclosed by us in the reports filed or submitted by us under the Exchange Act
is recorded, processed, summarized and reported, within the time periods
specified in the Securities Exchange Commission's rules and forms, including to
ensure that information required to be disclosed by us in the reports filed or
submitted by us under the Exchange Act is accumulated and communicated to our
management, including our principal executive and principal financial officer,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure. Based on that evaluation, our Chief
Executive Officer and Chief Financial Officer have concluded that as of
September 30, 2009, our disclosure controls and procedures were not effective at
the reasonable assurance level due to the material weaknesses identified and
described in Item 4T.





(b) Management Report on Internal Control
Over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial reporting is
defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange
Act, as amended, as a process designed by, or under the supervision of, our
principal executive and principal financial officer and effected by our board of
directors, management and other personnel, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles in the United States and includes those policies and
procedures that:


•
              Pertain
      to the maintenance of records that in reasonable detail accurately and
      fairly reflect our transactions and any disposition of our
      assets;
 •
                Provide
      reasonable assurance that transactions are recorded as necessary to permit
      preparation of financial statements in accordance with generally accepted
      accounting principles, and that our receipts and expenditures are being
      made only in accordance with authorizations of our management and
      directors; and
 •
                Provide
      reasonable assurance regarding prevention or timely detection of
      unauthorized acquisition, use or disposition of our assets that could have
      a material effect on the financial
statements.


Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect all misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.




26




A
material weakness is a deficiency, or a combination of deficiencies, in internal
control over financial reporting, such that there is a reasonable possibility
that a material misstatement of our annual or interim financial statements will
not be prevented or detected on a timely basis. Our management assessed the
effectiveness of our internal control over financial reporting as of September
30, 2009. In making this assessment, our management used the criteria set forth
by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO) in Internal Control-Integrated Framework. Based on this assessment,
Management has identified the following two material weaknesses that have caused
management to conclude that, as of September 30, 2009, our disclosure controls
and procedures, and our internal control over financial reporting, were not
effective at the reasonable assurance level:





1.           We
have not documented our internal controls. We have limited policies and
procedures that cover the recording and reporting of financial transactions.
 Management evaluated the impact of our failure to have written
documentation of our internal controls and procedures on our assessment of our
disclosure controls and procedures and has concluded that the control deficiency
that resulted represented a material weakness.





2.           We
do not have an independent Board of Directors or audit or compensation
committees.  Management is aware that an audit committee composed of
the requisite number of independent members along with a qualified financial
expert has not yet been established.  Considering the costs associated
with procuring and providing the infrastructure to support an independent audit
committee and the limited number of transactions, Management has concluded that
the risks associated with the lack of an independent audit committee are not
justified.  Management will periodically reevaluate this
situation.





3.           We
are not adequately segregating our duties.  Management is aware that
there is a lack of segregation of duties at the Company due to the small number
of employees dealing with general administrative and financial
matters.  However, at this time management has decided that
considering the abilities of the employees now involved and the control
procedures in place, the risks associated with such lack of segregation are low
and the potential benefits of adding employees to clearly segregate duties do
not justify the substantial expenses associated with such
increases.  Management will periodically reevaluate this
situation.





To
address these material weaknesses, management performed additional analyses and
other procedures to ensure that the financial statements included herein fairly
present, in all material respects, our financial position, results of operations
and cash flows for the periods presented. Accordingly, we believe that the
consolidated financial statements included in this report fairly present, in all
material respects, our financial condition, results of operations and cash flows
for the periods presented.





This
Quarterly Report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public
accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit us to provide only our management’s report in this
Quarterly Report.




27





(c) Remediation of Material
Weaknesses




Being aware of these material
weaknesses our management will be vigilant about ensuring they do not affect our
reporting obligations and will seek to remedy these issues when it is
financially feasible to do so.





(d) Changes in Internal Control over
Financial Reporting




There
have been no changes to our internal control over financial reporting during our
most recently completed fiscal quarter.


28


PART II – OTHER
INFORMATION





ITEM
1.           Legal
Proceedings.





We are
currently not involved in any litigation that we believe could have a material
adverse effect on our financial condition or results of
operations.  There is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the
executive officers of our company or any of our subsidiaries, threatened against
or affecting our company, our common stock, any of our subsidiaries or of our
companies or our subsidiaries' officers or directors in their capacities as
such, in which an adverse decision could have a material adverse
effect.





ITEM
1A.        Risk Factors.





As a
smaller reporting company we are not required to provide the information
required by this Item.  However, we did include risk factors in our
Amendment No. 4 to our Registration Statement on Form S-1 filed with the
Commission on June 5, 2009.  The following are updated or new risk
factors since the time of that filing:





We
lack an operating history and have losses which we expect to continue into the
future. As a result, we may have to suspend or cease activities.





We were
incorporated in August 20, 1999 and we have not started our proposed business
activities or realized any revenues. We have no operating history upon which an
evaluation of our future success or failure can be made. Our net loss was
$3,913,684 from inception to September 30, 2009. Our ability to achieve and
maintain profitability and positive cash flow is dependent upon:





·
            our
      ability to locate a profitable mineral
property


·
            our
      ability to generate revenues


·
            our
      ability to reduce exploration
costs.





Based
upon current plans, we expect to incur operating losses in future periods. This
will happen because there are expenses associated with the research and
exploration of our mineral properties. As a result, we may not generate revenues
in the future. Failure to generate revenues will cause us to suspend or cease
activities.





Because we are quoted on the OTC
Bulletin Board instead of an exchange or national quotation system, our
investors may have a tougher time selling their stock or experience negative
volatility on the market price of our stock.





Our
common stock is traded on the OTC Bulletin Board. The OTC Bulletin is often
highly illiquid.  There is a greater chance of volatility for
securities that trade on the OTC Bulletin Board as compared to a national
exchange or quotation system.  This volatility may be caused by a variety
of factors, including the lack of readily available price quotations, the
absence of consistent administrative supervision of bid and ask quotations,
lower trading volume, and market conditions.  Investors in our common stock
may experience high fluctuations in the market price and volume of the trading
market for our securities.  These fluctuations, when they occur, have a
negative effect on the market price for our securities.  Accordingly, our
stockholders may not be able to realize a fair price from their shares when they
determine to sell them or may have to hold them for a substantial period of time
until the market for our common stock improves.




29





ITEM
2.           Unregistered
Sales of Equity Securities and Use of Proceeds.





Effective
on September 25, 2009, we entered into a Securities Purchase Agreement with a
single non-affiliate investor to purchase (i) 60,000 shares of our commons
stock, and (ii) warrants to buy another 100,000 shares of our common stock at
$2.50 per share, in exchange for aggregate consideration of
$150,000.  The purchase will take place in three different closings on
the 10th of each of October, November, and December 2009.  The
warrants will vest on the first closing.  The first payment was made
in early October.  The issuance was exempt from registration pursuant
to Section 4(2) of the Securities Act of 1933, and the investor was
accredited.





ITEM
3.           Defaults
upon Senior Securities.





There
have been no events which are required to be reported under this
Item.





ITEM
4.           Submission
of Matters to a Vote of Security Holders.





There
have been no events required to be reported under this Item.





ITEM
5.           Other
Information.





Resignation and Appointment
of Directors and Officers





Effective
August 5, 2009, Donald J. Steinberg resigned as our Chief Financial Officer,
Chief Accounting Officer, and as a member of our Board of
Directors.  Robert Leitzman, our Vice President and a member of our
Board of Directors, was appointed as our Chief Financial Officer and Chief
Accounting Officer effective as of the same date.





Effective August 5, 2009, Roger
McCaslin was appointed as a member of our Board of Directors to fill the vacancy
left upon the death of Glynn G. Burkhardt and will serve out Mr. Burkhardt’s
term.





Mr.
McCaslin is currently employed at the Greenhorn Creek Guest Ranch in Quincy,
California, and the Tanque Verde Guest Ranch in Tucson, Arizona, where he has
worked since 2002, overseeing guests, employees and
livestock.  Mr. McCaslin was Facility Manager at Cobre Valley Mineral
Recovery from 1997 to 2004, where he was in charge of equipment, maintenance,
operations, surface and sub-surface testing, as well as spectrographic
equipment.





ITEM
6.           Exhibits.





(a)           Exhibits








3.1
      (1)
                          
                          Articles
      of Incorporation of United Mines, Inc.3.2
      (1)
                          
                          Articles
      of Amendment to Articles of Incorporation3.3
      (1)
                          
                          Bylaws
      of United Mines, Inc.10.1
      (1)
                          
                          Stock
      Purchase/Consulting Agreement with Robert Metz dated January 2,
      200810.2
      (1)
                          
                          Stock
      Purchase/Consulting Agreement with Robert Leitzman dated November 10,
      2006




30




10.3
      (1)
            
            Quitclaim
      Deeds from Mssrs. Burkhardt and others21
      (1)
            
            Subsidiaries
      of United Mines, Inc.99.1
      (2)
            
            Mining
      Claim Ledger for Material and Non-Material Claims99.2
      (1)
            
            ASLD
      Mineral Exploration Permits99.3
      (2)
            
            Industry
      Guide No. 7 and Glossary of Mining and Mineral Resource
    Terms99.4
      (2)
            
            Permits,
      State Lease Maps, and Small Scale Location Map for the Cerro Colorado
      Project99.5
      (2)
            
            Project
      Area Project Area and Lode Claim Maps for the Blue Copper, Green Copper
      and Red Beds Mining Claims




(1)    Incorporated
by reference from our registration statement on Form S-1, filed with the
Commission on December 30, 2008.





(2)    Incorporated
by reference from our registration statement on Form S-1 (Amendment #1), filed
with the Commission on March 20, 2009.


31


SIGNATURES





In accordance with Section 13 or 15(d)
of the Exchange Act, the registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.





United
      Mines, Inc.Dated:  November
      16, 2009
                
                /s/  Glenn
      E. MartinBy:
                Glenn
      E. MartinIts:
                President
      and Chairman of the
                  BoardDated:  November
      16, 2009
                
                /s/  Robert
      LeitzmanBy:
                Robert
      LeitzmanIts:
                Chief
      Financial Officer, Principal
                  Accounting
      Officer


32