##### Table of Contents



U.S. SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDEDApril 30, 2008.
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD OF ______________ TO ______________.
 Commission File Number: 001-33125
 METALLINE MINING COMPANY
 (Exact name of registrant as specified in its charter)
 Nevada
    
    91-1766677State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization
    
    Identification No.)
 1330 E. Margaret Ave., Coeur dAlene, ID 83815  (Address of principal executive offices, including zip code)
 (208) 665-2002
  þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting Company o
  o þ




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##### 



PART I  FINANCIAL INFORMATION
 ITEM 1. FINANCIAL STATEMENTS
 METALLINE MINING COMPANY
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED APRIL 30, 2008
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PAGEConsolidated Financial Statements:Consolidated Balance Sheets as of April 30, 2008 and October 31, 2007
    
    
    2Consolidated Statements of Operations for the three and six months ended 
April 30, 2008 and April 30, 2007 and for the period from inception
(November 8, 1993) to April 30, 2008
    
    
    3Consolidated Statements of Cash Flows for the six months ended 
April 30, 2008 and April 30, 2007, and for the period from inception
(November 8, 1993) to April 30, 2008
    
    
    4-5Condensed Notes to Consolidated Financial Statements
    
    
    6Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
    1




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##### Table of Contents



METALLINE MINING COMPANY
(AN EXPLORATION STAGE COMPANY)
 
 CONSOLIDATED BALANCE SHEETS
 April 30,
    
    
    October 31,2008
    
    
    2007(Unaudited)ASSETSCURRENT ASSETSCash and cash equivalents
    
    $
    6,454,488
    
    
    $
    1,434,487Marketable securities
    
    
    
    
    
    
    7,900,000Value-added tax receivable
    
    
    681,157
    
    
    
    401,341Other receivables
    
    
    34,345
    
    
    
    23,993Prepaid expenses
    
    
    269,664
    
    
    
    17,827Total Current Assets
    
    
    7,439,654
    
    
    
    9,777,648PROPERTY CONCESSIONSSierra Mojada District (Note 4)
    
    
    4,633,218
    
    
    
    4,536,111EQUIPMENTOffice and mining equipment, net of accumulated depreciation
of $509,982 and 407,457, respectively (Note 5)
    
    
    1,123,790
    
    
    
    919,420TOTAL ASSETS
    
    $
    13,196,662
    
    
    $
    15,233,179LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIESAccounts payable
    
    $
    199,915
    
    
    $
    84,634Accounts payable  Related Parties
    
    
    
    
    
    
    68,460Income Tax Payable
    
    
    39,956
    
    
    
    55,331Accrued liabilities and expenses
    
    
    228,331
    
    
    
    92,133Other liabilities
    
    
    79,172
    
    
    
    100,766Total Current Liabilities
    
    
    547,374
    
    
    
    401,324COMMITMENTS AND CONTINGENCIES (Note 10)
    
    
    
    
    
    
    STOCKHOLDERS EQUITYCommon stock, $0.01 par value; 160,000,000 shares authorized,
39,644,627 and 39,144,977 shares issued and outstanding, respectively
    
    
    396,446
    
    
    
    391,450Additional paid-in capital
    
    
    50,975,533
    
    
    
    49,273,440Deficit accumulated during exploration stage
    
    
    (38,437,603
    )
    
    
    (34,746,393
    )Other comprehensive (loss)
    
    
    (285,088
    )
    
    
    (86,642
    )Total Stockholders Equity
    
    
    12,649,288
    
    
    
    14,831,855TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    13,196,662
    
    
    $
    15,233,179
   2




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##### Table of Contents



METALLINE MINING COMPANY
(AN EXPLORATION STAGE COMPANY)
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 November 8,Three Months Ended
    
    
    Six Months Ended
    
    
    1993 (Inception)April 30,
    
    
    April 30,
    
    
    to April 30,2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008REVENUES
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    EXPLORATION AND PROPERTY HOLDING COSTSExploration and property holding costs
    
    
    753,921
    
    
    
    656,250
    
    
    
    1,387,676
    
    
    
    1,243,532
    
    
    
    14,221,798Depreciation and asset write-off
    
    
    45,947
    
    
    
    36,707
    
    
    
    106,203
    
    
    
    36,707
    
    
    
    589,526TOTAL EXPLORATION AND PROPERTY HOLDING COSTS
    
    
    799,868
    
    
    
    692,957
    
    
    
    1,493,879
    
    
    
    1,280,239
    
    
    
    14,811,324GENERAL AND ADMINISTRATIVE EXPENSESSalaries and payroll expenses
    
    
    472,064
    
    
    
    168,614
    
    
    
    1,107,542
    
    
    
    332,012
    
    
    
    10,934,024Office and administrative expenses
    
    
    195,312
    
    
    
    140,246
    
    
    
    289,112
    
    
    
    259,389
    
    
    
    2,280,345Professional services
    
    
    551,778
    
    
    
    303,777
    
    
    
    871,831
    
    
    
    1,656,722
    
    
    
    8,821,284Directors fees
    
    
    163,293
    
    
    
    70,800
    
    
    
    323,922
    
    
    
    148,800
    
    
    
    2,599,253Depreciation
    
    
    6,610
    
    
    
    3,785
    
    
    
    12,976
    
    
    
    7,570
    
    
    
    188,362TOTAL GENERAL AND ADMINISTRATIVE EXPENSES
    
    
    1,389,057
    
    
    
    687,222
    
    
    
    2,605,383
    
    
    
    2,404,493
    
    
    
    24,823,268LOSS FROM OPERATIONS
    
    
    (2,188,925
    )
    
    
    (1,380,179
    )
    
    
    (4,099,262
    )
    
    
    (3,684,732
    )
    
    
    (39,634,592
    )OTHER INCOME (EXPENSES)Interest and investment income
    
    
    32,727
    
    
    
    67,148
    
    
    
    122,353
    
    
    
    137,781
    
    
    
    807,317Foreign currency transaction gain (loss)
    
    
    481,990
    
    
    
    
    
    
    
    325,874
    
    
    
    
    
    
    
    423,882Miscellaneous ore sales, net of expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    134,242VAT tax refunds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    132,660Miscellaneous income
    
    
    
    
    
    
    2,718
    
    
    
    17
    
    
    
    2,814
    
    
    
    82,352Interest and financing expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (289,230
    )TOTAL OTHER INCOME (EXPENSE)
    
    
    514,717
    
    
    
    69,866
    
    
    
    448,244
    
    
    
    140,595
    
    
    
    1,291,223LOSS BEFORE INCOME TAXES
    
    
    (1,674,208
    )
    
    
    (1,310,313
    )
    
    
    (3,651,018
    )
    
    
    (3,544,137
    )
    
    
    (38,343,369
    )INCOME TAXES
    
    
    4,350
    
    
    
    
    
    
    
    40,192
    
    
    
    
    
    
    
    94,234NET LOSS
    
    $
    (1,678,558
    )
    
    $
    (1,310,313
    )
    
    $
    (3,691,210
    )
    
    $
    (3,544,137
    )
    
    $
    (38,437,603
    )OTHER COMPREHENSIVE INCOME (LOSS)  Foreign
Currency translation adjustments
    
    
    (284,817
    )
    
    
    
    
    
    
    (198,446
    )
    
    
    
    
    
    
    (285,088
    )COMPREHENSIVE LOSS
    
    $
    (1,963,375
    )
    
    $
    (1,310,313
    )
    
    $
    (3,889,656
    )
    
    $
    (3,544,137
    )
    
    $
    (38,722,691
    )BASIC AND DILUTED NET LOSS PER COMMON SHARE
    
    $
    (0.04
    )
    
    $
    (0.04
    )
    
    $
    (0.09
    )
    
    $
    (0.10
    )BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
    
    
    39,612,587
    
    
    
    35,650,954
    
    
    
    39,503,884
    
    
    
    34,915,983
   3




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##### Table of Contents



METALLINE MINING COMPANY
(AN EXPLORATION STAGE COMPANY)
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Period fromNovember 8,Six Months Ended
    
    
    1993 (Inception)April 30,
    
    
    to April 30,2008
    
    
    2007
    
    
    2008CASH FLOWS FROM OPERATING ACTIVITIES:Net loss
    
    $
    (3,691,210
    )
    
    $
    (3,544,137
    )
    
    $
    (38,437,603
    )Adjustments to reconcile net loss to net cash used by operating activities:Depreciation and equipment write-off
    
    
    119,223
    
    
    
    44,277
    
    
    
    779,942Noncash expenses
    
    
    
    
    
    
    
    
    
    
    126,864Foreign currency transaction loss (gain)
    
    
    (319,909
    )
    
    
    
    
    
    
    (417,915
    )Common stock issued for services
    
    
    
    
    
    
    
    
    
    
    1,237,047Common stock issued for compensation
    
    
    82,840
    
    
    
    
    
    
    
    1,059,946Stock options issued for compensation
    
    
    956,863
    
    
    
    
    
    
    
    5,751,052Common stock issued for directors fees
    
    
    190,824
    
    
    
    188,460
    
    
    
    497,004Stock options and warrants issued for directors fees
    
    
    
    
    
    
    
    
    
    
    1,665,705Stock options issued for services
    
    
    
    
    
    
    
    
    
    
    849,892Stock options issued for financing fees
    
    
    
    
    
    
    
    
    
    
    276,000Common stock issued for payment of expenses
    
    
    
    
    
    
    
    
    
    
    326,527Stock warrants issued for services
    
    
    
    
    
    
    1,094,950
    
    
    
    1,852,720(Increase) decrease in:Accounts receivable
    
    
    
    
    
    
    3,294
    
    
    
    Value added tax receivable
    
    
    (263,887
    )
    
    
    (501,032
    )
    
    
    (657,121
    )Other receivables
    
    
    (9,880
    )
    
    
    (31,246
    )
    
    
    (33,552
    )Prepaid expenses
    
    
    (247,274
    )
    
    
    (15,567
    )
    
    
    (265,062
    )Increase (decrease) in:Accounts payable
    
    
    115,329
    
    
    
    (138,102
    )
    
    
    199,831Accounts payable  related parties
    
    
    (68,460
    )
    
    
    (69,660
    )
    
    
    Income tax payable
    
    
    (16,112
    )
    
    
    
    
    
    
    38,102Accrued liabilities and expenses
    
    
    131,301
    
    
    
    (33,308
    )
    
    
    223,114Other liabilities
    
    
    (23,109
    )
    
    
    
    
    
    
    75,622Net cash used by operating activities
    
    
    (3,043,461
    )
    
    
    (3,002,071
    )
    
    
    (24,851,885
    )CASH FLOWS FROM INVESTING ACTIVITIES:Purchase of investments
    
    
    
    
    
    
    
    
    
    
    (21,609,447
    )Proceeds from investment sales
    
    
    7,900,000
    
    
    
    3,425,000
    
    
    
    21,609,447Equipment purchases
    
    
    (299,785
    )
    
    
    (24,845
    )
    
    
    (1,836,622
    )Mining property acquisitions
    
    
    
    
    
    
    
    
    
    
    (4,632,037
    )Net cash provided by (used by) investing activities
    
    
    7,600,215
    
    
    
    3,400,155
    
    
    
    (6,468,659
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from sales of common stock
    
    
    
    
    
    
    5,671,893
    
    
    
    33,379,207Proceeds from sales of options and warrants
    
    
    
    
    
    
    84,375
    
    
    
    949,890Proceeds from exercise of warrants
    
    
    476,563
    
    
    
    
    
    
    
    3,447,966Proceeds from shareholder loans
    
    
    
    
    
    
    
    
    
    
    30,000Payment of note payable
    
    
    
    
    
    
    
    
    
    
    (15,783
    )Net cash provided by financing activities:
    
    
    476,563
    
    
    
    5,756,268
    
    
    
    37,791,280Effect of exchange rates on cash
    
    
    (13,316
    )
    
    
    
    
    
    
    (16,248
    )Net (decrease) increase in cash and cash equivalents
    
    
    5,020,001
    
    
    
    6,154,352
    
    
    
    6,454,488Cash and cash equivalents beginning of period
    
    
    1,434,487
    
    
    
    689,994
    
    
    
    Cash and cash equivalents end of period
    
    $
    6,454,488
    
    
    $
    6,844,346
    
    
    $
    6,454,488
   4




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##### Table of Contents



METALLINE MINING COMPANY
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
 Period fromNovember 8,Six Months Ended
    
    
    1993 (Inception)April 30,
    
    
    to April 30,2008
    
    
    2007
    
    
    2008SUPPLEMENTAL CASH FLOW DISCLOSURES:Income taxes paid
    
    $
    29,328
    
    
    $
    
    
    
    $
    29,328Interest paid
    
    $
    
    
    
    $
    2,167
    
    
    $
    286,771NON-CASH INVESTING AND FINANCING ACTIVITIES:Common stock issued for equipment
    
    $
    
    
    
    $
    
    
    
    $
    25,000Common stock options issued for financing fees
    
    $
    
    
    
    $
    
    
    
    $
    276,000Common stock options issued for non-cash options
    
    $
    
    
    
    $
    59,220
    
    
    $
    59,220
   5




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##### Table of Contents



NOTE 1  ORGANIZATION AND DESCRIPTION OF BUSINESS
     NOTE 2  BASIS OF PRESENTATION
     6




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##### Table of Contents



NOTE 3  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
  Reclassifications
  Concentration of Risk
  Earnings Per Share
  Exploration Costs
  Foreign Operations
  IVA Tax Receivable
   7




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##### Table of Contents



NOTE 3  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
 Marketable Securities
 Accounting for
Certain Investments in Debt and Equity Securities
  Income Taxes
   Recent Accounting Pronouncements
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities  including an amendment of FASB Statement No. 115
  8




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##### Table of Contents



NOTE 3  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
 Business Combinations
 , Noncontrolling Interests in Consolidated Financial
Statements
 , Disclosures about Derivative Instruments and Hedging
Activities  an amendment of FASB Statement No. 133
  NOTE 4  CONCESSIONS IN THE SIERRA MOJADA DISTRICT
 Sierra Mojada Mining Concessions
    9




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##### Table of Contents



NOTE 4  CONCESSIONS IN THE SIERRA MOJADA DISTRICT (continued)
  Concession
    
    Acquisition Method
    
    Date
    
    Hectares
    
    
    Cost BasisSierra Mojada
    
    Purchased
    
    5/30/2000
    
    
    4,767.32
    
    
    $
    16,283Mojada 3
    
    Purchased
    
    5/30/2000
    
    
    722.00
    
    
    
    Unificacion Mineros
Nortenos
    
    Purchased
    
    8/30/2000
    
    
    336.79
    
    
    
    3,777,439Vulcano
    
    Purchased
    
    8/30/2000
    
    
    4.49
    
    
    
    Esmeralda 1
    
    Purchased
    
    8/20/2001
    
    
    95.50
    
    
    
    185,640Esmeralda
    
    Purchased
    
    3/20/1997
    
    
    117.50
    
    
    
    262,219La Blanca
    
    Purchased
    
    8/20/2001
    
    
    33.50
    
    
    
    125,916Fortuna
    
    Claim Filed
    
    12/8/1999
    
    
    13.96
    
    
    
    78,697Mojada 2
    
    Claim Filed
    
    7/17/2006
    
    
    3,500.00
    
    
    
    El Retorno
    
    Purchased
    
    4/10/2006
    
    
    817.65
    
    
    
    15,815Los Ramones
    
    Purchased
    
    4/10/2006
    
    
    8.60
    
    
    
    286El Retorno Fracc. 1
    
    Purchased
    
    4/20/2006
    
    
    5.51
    
    
    
    95Dormidos
    
    Claim Filed
    
    4/9/2007
    
    
    2,326.10
    
    
    
    Agua Mojada(1)
    
    Claim Filed
    
    1/26/2007
    
    
    2,900.00
    
    
    
    6,261Alote(1)
    
    Claim Filed
    
    5/17/2007
    
    
    3,749.00
    
    
    
    6,224Volcan Dolores
    
    Purchased
    
    9/24/2007
    
    
    10.49
    
    
    
    158,34319,408.41
    
    
    $
    4,633,218
 
 (1)
    
    Title for this concession is pending. NOTE 5  PROPERTY AND EQUIPMENT
  April 30,
    
    
    October 31,2008
    
    
    2007Mining equipment
    
    $
    1,080,966
    
    
    $
    838,635Well equipment
    
    
    38,974
    
    
    
    Communication equipment
    
    
    9,092
    
    
    
    8,902Buildings and structures
    
    
    163,060
    
    
    
    153,590Vehicles
    
    
    151,070
    
    
    
    172,449Computer equipment and software
    
    
    185,211
    
    
    
    145,167Office equipment
    
    
    5,399
    
    
    
    8,1341,633,772
    
    
    
    1,326,877Less: Accumulated depreciation
    
    
    (509,982
    )
    
    
    (407,457
    )$
    1,123,790
    
    
    $
    919,420
   10




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##### Table of Contents



NOTE 6  SHAREHOLDER RIGHTS PLAN
   NOTE 7  COMMON STOCK
  NOTE 8  STOCK OPTIONS
   Six months EndedApril 30,Options
    
    2008
    
    
    2007(1)Expected volatility
    
    
    73
    %
    
    
    Risk-free interest rate
    
    
    3.4
    %
    
    
    Dividend yield
    
    
    
    
    
    
    Expected term (in years)
    
    
    8.05
    
    
    
    
 
 (1)
    
    No options were granted during the six months ended April 30, 2007.   11




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##### Table of Contents



NOTE 8  STOCK OPTIONS (continued)
  WeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    Shares
    
    
    Price
    
    
    Life (Years)
    
    
    ValueOutstanding at October 31, 2007
    
    
    3,650,000
    
    
    $
    2.63Granted
    
    
    750,004
    
    
    
    2.19Exercised
    
    
    
    
    
    
    Forfeited or Expired
    
    
    
    
    
    
    Outstanding at April 30, 2008
    
    
    4,400,004
    
    
    $
    2.56
    
    
    
    7.61
    
    
    $
    115,000Vested or Expected to Vest at
April 30, 2008
    
    
    4,400,004
    
    
    $
    2.56
    
    
    
    7.61
    
    
    $
    115,000Exercisable at April 30, 2008
    
    
    3,533,333
    
    
    $
    2.49
    
    
    
    7.42
    
    
    $
    115,000
   Options Outstanding
    
    
    Options ExercisableWeightedAve.
    
    
    Weighted
    
    
    
    
    
    
    WeightedRemaining
    
    
    Average
    
    
    
    
    
    
    AverageExercise
    
    
    Number
    
    
    Contractual
    
    
    Exercise
    
    
    Number
    
    
    ExercisePrice
    
    
    Outstanding
    
    
    Life (Years)
    
    
    Price
    
    
    Exercisable
    
    
    Price$
    1.25-1.32
    
    
    
    200,000
    
    
    
    1.85
    
    
    $
    1.29
    
    
    
    200,000
    
    
    $
    1.292.15-2.85
    
    
    
    3,950,004
    
    
    
    7.80
    
    
    
    2.51
    
    
    
    3,283,333
    
    
    
    2.534.30
    
    
    
    250,000
    
    
    
    9.14
    
    
    
    4.30
    
    
    
    50,000
    
    
    
    4.30$
    1.25-4.30
    
    
    
    4,400,004
    
    
    
    7.61
    
    
    $
    2.56
    
    
    
    3,533,333
    
    
    $
    2.49
  Weighted-AverageGrant-DateNonvested Shares
    
    Shares
    
    
    Fair ValueNonvested at October 31, 2007
    
    
    400,000
    
    
    $
    2.79Granted
    
    
    750,004
    
    
    
    1.62Vested
    
    
    (283,333
    )
    
    
    1.56Forfeited
    
    
    
    
    
    
    Nonvested at April 30, 2008
    
    
    866,671
    
    
    $
    2.18
  12




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##### Table of Contents



NOTE 8  STOCK OPTIONS (continued)
     NOTE 9  WARRANTS
   WeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicWarrants
    
    Shares
    
    
    Price
    
    
    Life (Years)
    
    
    ValueOutstanding at October 31, 2007
    
    
    14,380,147
    
    
    $
    1.44Issued with private placement
    
    
    
    
    
    
    Issued for services
    
    
    
    
    
    
    Exercised
    
    
    (381,250
    )
    
    
    1.25Forfeited or expired
    
    
    (152,333
    )
    
    
    1.88Outstanding at April 30, 2008
    
    
    13,846,564
    
    
    $
    1.44
    
    
    
    2.75
    
    
    $
    7,310,953
  13




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##### Table of Contents



NOTE 9  WARRANTS (continued)
  Warrants Outstanding and ExercisableWeighted Ave.Remaining
    
    
    WeightedNumber
    
    
    Contractual
    
    
    AverageExercise Price
    
    
    Outstanding
    
    
    Life (Years)
    
    
    Exercise Price$
    1.25  $1.75
    
    
    
    11,985,169
    
    
    
    2.71
    
    
    $
    1.25$
    2.00  $2.63
    
    
    
    1,361,395
    
    
    
    2.74
    
    
    
    2.42$
    3.40  $5.00
    
    
    
    500,000
    
    
    
    3.68
    
    
    
    3.40$
    1.25  $5.00
    
    
    
    13,846,564
    
    
    
    2.75
    
    
    $
    1.44
   NOTE 10  COMMITMENTS AND CONTINGENCIES
 Compliance with Environmental Regulations
  Employment Agreements
   Royalty Agreement
   14




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##### Table of Contents



NOTE 10  COMMITMENTS AND CONTINGENCIES (continued)
 Mining Concessions
  NOTE 11  INCOME TAXES
 Provision for Taxes
   Adoption
of FIN 48  Accounting for Uncertainty in Income Taxes
     United States:
    
    1993 and all following yearsMexico:
    
    1997 and all following years
    15




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##### Table of Contents



NOTE 12  SEGMENT INFORMATION
   April 30,April 30,
    
    
    October 31,2008
    
    
    2007Identifiable assetsMexico
    
    $
    6,305,000
    
    
    $
    6,063,000United States
    
    
    6,892,000
    
    
    
    9,170,000$
    13,197,000
    
    
    $
    15,233,000
 Inception toFor the six months ended
    
    
    dateApril 30,
    
    
    April 30,2008
    
    
    2007
    
    
    2008Net loss for the periodMexico
    
    $
    1,070,000
    
    
    $
    980,000
    
    
    $
    8,688,000United States
    
    
    2,621,000
    
    
    
    2,564,000
    
    
    
    29,749,000$
    3,691,000
    
    
    $
    3,544,000
    
    
    $
    38,437,000
 NOTE 13  SUBSEQUENT EVENTS
   16




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##### Table of Contents



ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
  Cautionary Statement about Forward-Looking Statements
 
 
    
    The amount and nature of future capital, development and exploration expenditures;
    
    The timing of exploration activities; and
    
    Business strategies and development of our business plan.
   Plan of Operation
  Feasibility Study- Oxide Zinc Mineralization
   17




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##### Table of Contents



Prepare for Test Mine
  Continued Improvement of the Sierra Mojada Infrastructure
  
    
    The company purchased 1 additional drill and has hired and trained additional personnel
to operate this equipment. The additional diamond drilling capabilities not only eliminated
dependence on outside contractors, but also increased our ability to quickly respond to any
additional drilling requirements for the feasibility study and has allowed for continued
exploration of the Silver Polymetallic Manto.
    
    An onsite sample laboratory was completed at Sierra Mojada and is being used to get
immediate feedback on drilling results and reduce outside sampling and assaying costs. All
samples that will be incorporated in mineral resource models will be assayed in duplicate
by the outside laboratory.
    
    A water pipeline was completed to provide water for increased drilling activities,
accommodate test mining and reduce our water costs.
 Exploration of Silver Polymetallic Manto
   18




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##### Table of Contents



Other
  Cautionary Note
  Results of Operation
 Three Months Ended April 30, 2008
  Exploration and property holding costs
  General and Administrative Costs
    19




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##### Table of Contents



Other Income (Expense)
  Six Months Ended April 30, 2008
  Exploration and property holding costs
  General and Administrative Costs
     20




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##### Table of Contents



Other Income (Expense)
  Liquidity and Capital Resources
     Recent Accounting Pronouncements
   21




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##### Table of Contents



Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities  including an amendment of FASB Statement No. 115
 Business Combinations
 , Noncontrolling Interests in Consolidated Financial
Statements
 , Disclosures about Derivative Instruments and Hedging
Activities  an amendment of FASB Statement No. 133
  Critical Accounting Policies
   22




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##### Table of Contents



Property Concessions
   Deferred tax assets and liabilities
  Estimates
  Foreign Currency Translation
  Accounting for Stock Options and Warrants Granted to Employees and Non-employees
   23




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##### Table of Contents



Impairment of Long-Lived Assets
  Environmental Matters
    24




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ITEM 3. QUANTITATATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Foreign Currency Exchange Risk
 
 ITEM
4T. CONTROLS AND PROCEDURES
 (a) Evaluation of Disclosure Controls and Procedures.
      25




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##### Table of Contents



(b) Changes In Internal Controls Over Financial Reporting
   PART II  OTHER INFORMATION
 Item 1. LEGAL PROCEEDINGS
  Item 1A. RISK FACTORS
  Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND PROCEEDS
 Recent Sales of Unregistered Securities
     Item 3. DEFAULT UPON SENIOR SECURITES
   26




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##### Table of Contents



Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  Item 5. OTHER INFORMATION
  Item 6. EXHIBITS
 3.1(a)
    
    Articles of Incorporation.13.1(b)
    
    Certificate of Amendment to Articles of Incorporation.23.2
    
    Bylaws.231.1
    
    Certification of CEO Pursuant to Exchange Act Rules 13a-14 and
15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed herewith.31.2
    
    Certification of CFO Pursuant to Exchange Act Rules 13a-14 and
15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed herewith.32.1
    
    Certification of CEO Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
herewith.32.2
    
    Certification of CFO Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
herewith.
 
 (1)
    
    Incorporated by reference from Form 10-SB, filed October 15, 1999.(2)
    
    Incorporated by reference from Form 10-QSB, filed September 19, 2006.  27




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##### Table of Contents



SIGNATURES
  METALLINE MINING COMPANYDate: June 16, 2008
    By:
    /s/ Merlin BinghamMerlin Bingham,President and Principal Executive OfficerDate: June 16, 2008
    By:
    /s/ Robert DeversRobert Devers,Chief Financial Officer and Principal
Accounting   Officer  28




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##### Table of Contents



EXHIBIT INDEX
 31.1
    
    Certification of CEO Pursuant to Exchange Act Rules 13a-14 and
15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed herewith.31.2
    
    Certification of CFO Pursuant to Exchange Act Rules 13a-14 and
15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002, filed herewith.32.1
    
    Certification of CEO Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
herewith.32.2
    
    Certification of CFO Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed
herewith.
  29