UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





(Mark
One)




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




For the
Quarterly Period Ended June 30, 2009





TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934




For the
transition period from _____ to _____.








Commission
File No.  001-34075





PIEDMONT
MINING COMPANY, INC.


(Exact
Name of Registrant as Specified in Its Charter)





North
      Carolina
                        
                        56-1378516(State
      or Other Jurisdiction
                          Of
      Incorporation or Organization)
                        (I.R.S.
      Employer Identification
                          Number)18124
      Wedge Parkway, Suite 214
                          Reno,
      Nevada
                        89511(Address
      of Principal Executive Offices)
                        (Zip
      Code)





Registrant’s
telephone number, including area code (212)
734-9848




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
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  No 








Indicate
by checkmark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer or a smaller reporting company.  See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-3 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





As of
August 6, 2009 there were 70,123,643 outstanding shares of the issuer’s common
stock.





PIEDMONT
MINING COMPANY, INC.





FORM
10-Q INDEX





Page
      NumberPART
      I – FINANCIAL INFORMATIONItem
      1. Financial StatementsConsolidated Balance
      Sheets
                    1Consolidated Statements of
      Loss
                    2Consolidated Statements of Cash
      Flows
                    3Notes to Consolidated Financial
      Statements
                    4Item
      2. Management’s Discussion and Analysis of Financial Conditionand
      Results of Operation
                    11Item
      3. Quantitative and Qualitative Disclosures About Market
    Risk
                    16Item
      4T. Controls and Procedures
                    16PART
      II – OTHER INFORMATIONItem
      1. Legal Proceedings
                    17Item
      1A. Risk Factors.
                    17Item
      2. Unregistered Sales of Equity Securities and Use of
    Proceeds
                    17Item
      3. Defaults Upon Senior Securities
                    17Item
      4. Submission of Matters to a Vote of Security Holders
                    17Item
      5. Other Information
                    17Item
      6. Exhibits
                    17Signature
      Page
                    18





PART
I – FINANCIAL INFORMATION





Item
1. Financial Statements




PIEDMONT
      MINING COMPANY, INC.
                                                                                            (An
      Exploration Stage Company)
                                                                                            CONSOLIDATED
      BALANCE SHEETSJune
      30,
                                                                                          
                                                                                          December
      31,2009
                                                                                            (unaudited)
                                                                                          
                                                                                          2008
                                                                                            (audited)ASSETS
                                                                                          $
                                                                                          
                                                                                          $CURRENT
      ASSETSCash
      and cash equivalents
                                                                                          276
                                                                                          
                                                                                          
                                                                                          582Prepaid
      expenses and other
                                                                                          4,424
                                                                                          
                                                                                          
                                                                                          32,4314,700
                                                                                          
                                                                                          
                                                                                          33,013MINERAL
      PROPERTIES (Note 3)
                                                                                          142,500
                                                                                          
                                                                                          
                                                                                          122,000RECLAMATION
      BONDS (Note 3)
                                                                                          27,542
                                                                                          
                                                                                          
                                                                                          29,339EQUIPMENT
      (Note 4)
                                                                                          -
                                                                                          
                                                                                          
                                                                                          65Total
      Assets
                                                                                          174,742
                                                                                          
                                                                                          
                                                                                          184,417LIABILITIES
      AND STOCKHOLDERS’ EQUITY (DEFICIT)
                                                                                            
                                                                                            CURRENT
      LIABILITIESAccounts
      payable
                                                                                          433,414
                                                                                          
                                                                                          
                                                                                          401,438Due
      to related parties (Note 5)
                                                                                          373,821
                                                                                          
                                                                                          
                                                                                          253,929Total
      current liabilities
                                                                                          807,235
                                                                                          
                                                                                          
                                                                                          655,367STOCKHOLDERS’
      EQUITY (DEFICIT)Capital
      Stock (Note 6)Authorized:50,000,000
      Preferred stock $1.00 par value200,000,000
      Common stock no par valueCommon
      stock issued and outstanding:70,040,310  shares
      (2008 – 68,615,310)
                                                                                          16,545,145
                                                                                          
                                                                                          
                                                                                          16,485,145Additional
      paid-in capital
                                                                                          865,142
                                                                                          
                                                                                          
                                                                                          848,659Deficit
      accumulated prior to the exploration stage
                                                                                          (12,564,287)
                                                                                          
                                                                                          
                                                                                          (12,564,287
                                                                                          )Deficit
      accumulated during exploration stage
                                                                                          (5,478,493)
                                                                                          
                                                                                          
                                                                                          (5,240,467
                                                                                          )Total
      stockholders’ equity (deficit)
                                                                                          (632,493)
                                                                                          
                                                                                          
                                                                                          (470,950)Total
      liabilities and stockholders’ equity (deficit)
                                                                                          174,742
                                                                                          
                                                                                          
                                                                                          184,417The
      accompanying notes are an integral part of these financial
      statements.






1


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


CONSOLIDATED
STATEMENTS OF LOSS


(unaudited)








Three
      months
                                            Ended
                                            June
      30, 2009
                                          
                                          
                                          Three
      months
                                            Ended
                                            June
      30, 2008
                                          
                                          
                                          Six
      months
                                            Ended
                                            June
      30, 2009
                                          
                                          
                                          Six
      months
                                            Ended
                                            June
      30, 2008
                                          
                                          
                                          For
      the Period
                                            from
      January 1,
                                            2002
      (Date
                                            of
      Inception
                                            of
      Exploration Stage)
                                            toJune
      30, 2009$
                                          
                                          
                                          
                                          $
                                          
                                          
                                          
                                          $
                                          
                                          
                                          
                                          $
                                          
                                          
                                          
                                          $EXPENSESDepreciation
                                          
                                          
                                          -
                                          
                                          
                                          
                                          216
                                          
                                          
                                          
                                          65
                                          
                                          
                                          
                                          432
                                          
                                          
                                          
                                          146,383Exploration, geological and
      geophysical costs
                                          
                                          
                                          1,449
                                          
                                          
                                          
                                          116,981
                                          
                                          
                                          
                                          29,645
                                          
                                          
                                          
                                          190,942
                                          
                                          
                                          
                                          2,282,011Finance
      fees
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          
                                          
                                          
                                          
                                          191,200General and
      administrative
                                          
                                          
                                          15,197
                                          
                                          
                                          
                                          91,829
                                          
                                          
                                          
                                          72,461
                                          
                                          
                                          
                                          128,183
                                          
                                          
                                          
                                          882,012Impairment of
      mineral  properties(Note 4)
                                          
                                          
                                          -
                                          
                                          
                                          
                                          205,500
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          205,500
                                          
                                          
                                          
                                          205,500Management
      fees
                                          
                                          
                                          51,350
                                          
                                          
                                          
                                          94,850
                                          
                                          
                                          
                                          100,484
                                          
                                          
                                          
                                          185,117
                                          
                                          
                                          
                                          923,372Professional
      fees
                                          
                                          
                                          12,992
                                          
                                          
                                          
                                          50,196
                                          
                                          
                                          
                                          55,072
                                          
                                          
                                          
                                          105,936
                                          
                                          
                                          
                                          832,35080,988
                                          
                                          
                                          
                                          559,572
                                          
                                          
                                          
                                          257,727
                                          
                                          
                                          
                                          816,110
                                          
                                          
                                          
                                          5,462,828LOSS
      BEFORE OTHER ITEMS
                                          
                                          
                                          (80,988
                                          )
                                          
                                          
                                          (559,572
                                          )
                                          
                                          
                                          (257,727
                                          )
                                          
                                          
                                          (816,110
                                          )
                                          
                                          
                                          (5,462,828
                                          )OTHER
      INCOME
                                          
                                          
                                          19,700
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          19,700
                                          
                                          
                                          
                                          3,198
                                          
                                          
                                          
                                          30,925L  LOSS
      ON OTHER NON-OPERATING ACTIVITIES
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (46,590
                                          )NET
      LOSS
                                          
                                          
                                          (61,288
                                          )
                                          
                                          
                                          (559,572
                                          )
                                          
                                          
                                          (238,027)
                                          
                                          
                                          
                                          (812,912
                                          )
                                          
                                          
                                          (5,478,493
                                          )BASIC
      AND DILUTED
                                            LOSS  PER
      SHARE
                                          
                                          
                                          (0.001
                                          )
                                          
                                          
                                          (0.008
                                          )
                                          
                                          
                                          (0.003
                                          )
                                          
                                          
                                          (0.013
                                          )WEIGHTED
      AVERAGE COMMON
                                            SHARES
      OUTSTANDING, BASIC
                                            AND
      DILUTED
                                          
                                          
                                          69,765,585
                                          
                                          
                                          
                                          66,816,647
                                          
                                          
                                          
                                          69,305,640
                                          
                                          
                                          
                                          64,295,112





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







2


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


CONSOLIDATED
STATEMENTS OF CASH FLOWS


(unaudited)


Six
      Months Ended
                                                          June
      30,
                                                        
                                                        
                                                        For
      the Period
                                                          from
      January 1,
                                                          2002
      (Date of
                                                          Inception
      of
                                                          Exploration
      Stage) to
                                                          June
      30,2009
                                                        
                                                        
                                                        2008
                                                        
                                                        
                                                        2009CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss for the period
                                                        
                                                        
                                                        (238,027
                                                        )
                                                        
                                                        
                                                        (812,912
                                                        )
                                                        
                                                        
                                                        (5,478,493
                                                        )Adjustments
      to reconcile net loss to net cash from operating
    activities:Stock
      issued as finance fees
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        100,000Warrants
      issued as finance fees
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        92,100Mineral
      property impairments
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        205,500
                                                        
                                                        
                                                        
                                                        205,500Stock
      based compensation
                                                        
                                                        
                                                        16,484
                                                        
                                                        
                                                        
                                                        102,517
                                                        
                                                        
                                                        
                                                        401,968Depreciation
                                                        
                                                        
                                                        65
                                                        
                                                        
                                                        
                                                        432
                                                        
                                                        
                                                        
                                                        146,383Gain
      (loss) on other non-operating activities
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        (21,000
                                                        )Changes
      in operating assets and liabilities:Prepaid
      expenses and other
                                                        
                                                        
                                                        28,007
                                                        
                                                        
                                                        
                                                        (223,547
                                                        )
                                                        
                                                        
                                                        (1,475
                                                        )Due
      to related parties
                                                        
                                                        
                                                        119,892
                                                        
                                                        
                                                        
                                                        3,932
                                                        
                                                        
                                                        
                                                        276,808Accounts
      payable
                                                        
                                                        
                                                        38,976
                                                        
                                                        
                                                        
                                                        (20,654
                                                        )
                                                        
                                                        
                                                        483,965NET
      CASH FLOWS USED IN
                                                          OPERATING
      ACTIVITIES
                                                        
                                                        
                                                        (34,603
                                                        )
                                                        
                                                        
                                                        (744,732
                                                        )
                                                        
                                                        
                                                        (3,794,244
                                                        )CASH
      FLOWS FROM FINANCING ACTIVITIESIssuance
      of shares for cash, net of issuance costs
                                                        
                                                        
                                                        35,000
                                                        
                                                        
                                                        
                                                        650,450
                                                        
                                                        
                                                        
                                                        3,704,174Convertible
      notes
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        291,145NET
      CASH FLOWS FROM
                                                          FINANCING
      ACTIVITIES
                                                        
                                                        
                                                        35,000
                                                        
                                                        
                                                        
                                                        650,450
                                                        
                                                        
                                                        
                                                        3,995,319CASH
      FLOWS FROM INVESTING ACTIVITIESPurchase
      of property and equipment
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        (5,579
                                                        )Proceeds
      from non-operating activities
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        97,125Reclamation
      bonds refund
                                                        
                                                        
                                                        1,797
                                                        
                                                        
                                                        
                                                        (29,339
                                                        )
                                                        
                                                        
                                                        1,797Mineral
      property costs
                                                        
                                                        
                                                        (2,500
                                                        )
                                                        
                                                        
                                                        (30,000
                                                        )
                                                        
                                                        
                                                        (294,839
                                                        )NET
      CASH FLOWS USED IN
                                                          INVESTING
      ACTIVITIES
                                                        
                                                        
                                                        (703
                                                        )
                                                        
                                                        
                                                        (59,339
                                                        )
                                                        
                                                        
                                                        (219,496
                                                        )DECREASE
      IN CASH
                                                        
                                                        
                                                        (306
                                                        )
                                                        
                                                        
                                                        (153,621
                                                        )
                                                        
                                                        
                                                        (421
                                                        )CASH,
      BEGINNING
                                                        
                                                        
                                                        582
                                                        
                                                        
                                                        
                                                        165,877
                                                        
                                                        
                                                        
                                                        697CASH, ENDING
                                                        
                                                        
                                                        276
                                                        
                                                        
                                                        
                                                        12,256
                                                        
                                                        
                                                        
                                                        276SUPPLEMENTAL
      CASH FLOW INFORMATION AND
                                                          NON-CASH INVESTING AND
      FINANCING ACTIVITIES (Note 7)





The
accompanying notes are an integral part of these financial
statements







3




PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)







NOTE
1:                      NATURE
OF OPERATIONS







Piedmont
Mining Company, Inc. (the “Company”) was formed in 1983 under the laws of the
State of North Carolina, USA, and is currently in the exploration stage. The
Company is primarily involved in the examination and exploration of mineral
properties. Under Statement of Financial Accounting Standards No. 7 (SFAS) Accounting and Reporting by
Development Stage Enterprises, the Company re-established itself as an
exploration stage company in 2002 and began reporting under exploration stage
guidelines.





The
Company’s focus for the foreseeable future will be on the exploration of its
properties.  Since April 2005, the Company has entered into
agreements, directly and under options, for the purpose of exploring for
economic deposits of gold and silver in the State of
Nevada.





Going
Concern


These
financial statements have been prepared in accordance with generally accepted
accounting principles in the United States of America with the on-going
assumption applicable to a going concern which contemplates the realization of
assets and the satisfaction of liabilities and commitments in the normal course
of business.





The
Company is in the exploration stage and to date has not yet generated any net
revenues or cash flow from its activities. The Company has a history of losses
and has a working capital deficit of $802,535 and an accumulated deficit of
$18,042,780 at June 30, 2009.  The Company is dependent on raising
further capital to fund ongoing losses and expenditures for its exploration
programs. In the current market conditions there is uncertainty that the
necessary funding will be obtained as needed, raising substantial doubt as to
the ability of the Company to continue operating as a going concern. These
financial statements do not reflect any adjustments to the carrying values of
assets that might result from the outcome of this uncertainty.





The
Company plans to fund its ongoing operations by way of private placements of its
securities.  Management believes continued  efforts to sell stock
and warrants as well as advances from management will contribute toward funding
the Company’s activities until appropriate levels of funding can be arranged
and/or revenue can be earned from the properties either through production or
sale.  The global financial situation in 2008 and 2009 and the ensuing
downturn in the economy and in the mineral exploration industry have severely
restricted the ability of junior resource companies to raise capital. These
conditions cast significant doubt on the Company’s ability to continue its
exploration activities, particularly if current market conditions continue for a
sustained period. If the Company is unsuccessful in raising adequate financing,
exploration activity will be postponed until market conditions
improve.





Unaudited
Interim Financial Statements


The
accompanying unaudited interim consolidated financial statements have been
prepared in accordance with United States generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q. They may not include all information and footnotes required by United
States generally accepted accounting principles for complete financial statement
disclosure. However, except as disclosed herein, there have been no material
changes in the information disclosed in the notes to the financial statements
for the year ended December 31, 2008, included in the Company’s Form 10-K filed
with the Securities and Exchange Commission on March 31, 2009. The unaudited
interim consolidated financial statements should be read in conjunction with
those financial statements included in the Form 10-K. In the opinion of
Management, all adjustments considered necessary for a fair presentation,
consisting solely of normal recurring adjustments, have been made. Operating
results for the six months ended June 30, 2009 are not necessarily indicative of
the results that may be expected for the year ending December 31,
2009.










4


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)


NOTE
2:                      RECENT
ACCOUNTING PRONOUNCEMENTS





In April
2009, the FASB issued FSP SFAS 157-4 which provides additional guidance for
estimating fair value in accordance with SFAS 157, “Fair Value Measure In April
2009, the FASB issued FSP SFAS 157-4 which provides additional guidance for
estimating fair value in accordance with SFAS 157, “Fair Value Measurements”,
when the volume and level of activity for the asset or liability have
significantly decreased. FSP SFAS 157-4 also includes guidance on identifying
circumstances that indicate a transaction is not orderly. FSP SFAS 157-4
requires the disclosure of the inputs and valuation technique(s) used to
measurements”, when the volume and level of activity for the asset or liability
have significantly decreased. FSP SFAS 157-4 also includes guidance on
identifying circumstances that indicate a transaction is not orderly. FSP SFAS
157-4 requires the disclosure of the inputs and valuation technique(s) used to
measure fair value and a discussion of changes in valuation techniques and
related inputs, if any, during the period. The adoption of this statement did
not have a material impact on the Company’s results of operations and financial
position.





In June
2009, the FASB issued FAS No. 165 “Subsequent Events”(“FAS
165”). FAS 165 requires companies to recognize in the financial statements the
effects of subsequent events that provide additional evidence about conditions
that existed at the date of the balance sheet, including the estimates inherent
in the process of preparing financial statements. An entity shall disclose the
date through which subsequent events have been evaluated, as well as whether
that date is the date the financial statements were issued.  Companies
are not permitted to recognize subsequent events that provide evidence about
conditions that did not exist at the date of the balance sheet but arose after
the balance sheet date and before financial statements are issued. Some non
recognized subsequent events must be disclosed to keep the financial statements
from being misleading.  For such events a company must disclose the
nature of the event, an estimate of its financial effect, or a statement that
such an estimate cannot be made. This Statement applies prospectively for
interim or annual financial periods ending after June 15, 2009. The adoption of
FAS 165 is not expected to have a material impact on the Company’s results of
operations and financial position.





In
June 2009, the FASB issued SFAS No. 168, The FASB Accounting Standards
Codification and the Hierarchy of Generally Accepted Accounting Principles — a
replacement of FASB Statement No. 162(“SFAS 168”). Upon its adoption, the FASB Accounting Standards Codification (the
“Codification”) will become the source of authoritative GAAP recognized by the
FASB to be applied to nongovernmental entities. On the effective dateof SFAS
168, the Codification will supersede all then-existing non-SEC accounting and
reporting standards. Following SFAS 168, the FASB will not issue new accounting
standards in the form of FASB Statements, FASB Staff Positions, or Emerging
Issues Task Force abstracts. SFAS 168will also modify the
existing hierarchy of GAAP to include only two levels — authoritative and
non-authoritative.SFAS 168 will be effective for financial
statements issued for interim and annual periods ending after September 15,
2009, and early adoption is not permitted. The Company does not believe that the
adoption of this standard will have a material impact on its financial position,
results of operations or cash flows.





NOTE
3:                      MINERAL
PROPERTIES







The
Company has entered into various property agreements. A summary of capitalized
costs is as follows:


Balance
      as at
                  December
      31, 2008
                Transactions
                  during
      the period
                Balance
      as at
                  June  30,
      2009$
                $
                $Argentite
      Gold
                
                2,500
                2,500Bullion
      Mountain
                27,000
                8,000
                35,000Dutch
      Flat
                35,000
                -
                35,000Pasco
      Canyon
                10,000
                -
                10,000PPM
      Gold
                25,000
                -
                25,000Trinity
      Silver
                10,000
                -
                10,000Willow
      Creek
                15,000
                10,000
                25,000122,000
                20,500
                142,500







5


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)


NOTE
3:                      MINERAL
PROPERTIES (continued)







Balance
      as at
                      December
      31, 2008
                    Transactions
                      during
      the period
                    Balance
      as at
                      June  30,
      2009Reclamation
      Bonds:PPM Gold
                    11,566
                    -
                    11,566Willow Creek
                    17,773
                    (1,797)
                    15,97629,339
                    (1,797)
                    27,542





Argentite
Gold Project


On March
10, 2009, upon paying $2,500, the Company signed a Letter of Intent to enter
into an Exploration Agreement with Option to form Joint Venture on the Argentite
gold property in western Nevada once the gold price exceeds $1,000 per ounce for
more than 25 consecutive business days or after 90 days from the date of signing
the Letter of Intent.  On signing the formal agreement, the Company
would pay $8,000 and then undertake a work commitment of $750,000 over a five
year period to earn a 51% interest in the property and the project, or up to a
70% interest upon completion of a bankable feasibility study.  In
addition, the Company would make annual payments of $10,000 by the first
anniversary of the agreement, $15,000 on the second anniversary, $20,000 by the
third anniversary and $25,000 by the fourth anniversary, all of which would be
creditable against the work commitment.








NOTE
4                       EQUIPMENT


June
      30, 2009
                                                  
                                                  
                                                  December
      31, 2008Computer
      Equipment
                                                  
                                                  $
                                                  5,579
                                                  
                                                  
                                                  $
                                                  5,579Less:
      accumulated depreciation
                                                  
                                                  
                                                  (5,579
                                                  )
                                                  
                                                  
                                                  (5,514
                                                  )$
                                                  0
                                                  
                                                  
                                                  $
                                                  65





NOTE
5:        
             DUE
TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS





The Board
of Directors has authorized a monthly management fee of $14,000 to the Company’s
President and CEO. The unpaid portion of the monthly management fees at June 30,
2009 and December 31, 2008 was $231,250 and $147,250,
respectively.  Unreimbursed administrative expenses incurred by the
President and CEO at June 30, 2009 and December 31, 2008 were $33,655 and
$19,066, respectively. The Company reimburses the President for office rent,
which totaled $9,600 for the six months ended June 30, 2009 and
2008





The
President had advanced funds to the Company totaling $32,890 as of June 30,
2009, which remain unpaid and have accrued interest at 5% of $830, in accordance
with Company policy.








6


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)






NOTE
5:                      DUE
TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS(continued)





The
unpaid portion of exploration costs incurred by the Company’s Vice-President at
June 30, 2009 and December 31, 2008 were $22,567 and $28,270, respectively,
which includes his compensation of $24,940 and $21,880, respectively, for
services relating to the various exploration projects and research and
development. The Vice-President had incurred expenses on behalf of the Company
totaling $9,232 as of June 30, 2009, which remain unpaid.





The
directors receive a fee of $200 per meeting for participating in Board meetings
and Compensation and Audit Committee meetings. The Chairmen of these
Committeesreceive
$300 per meeting. The unpaid portion of these fees at June 30, 2009 and
December 31, 2008 were $1,400.





From time
to time, the Company’s officers and directors advance monies to the Company.
These loans bear interest at 5% per annum. These loans are unsecured and have no
fixed repayment terms. The unpaid balances including interest related to these
advances at June 30, 2009 and December 31, 2008 were $75,717 and $17,724,
respectively.





No stock
options were granted to its officers or directors by the Company for the six
months ended June 30, 2009.





All
related party transactions involving the provision of services or transfer of
tangible assets in the normal course of business were recorded at the exchange
amount, which is the value established and agreed to by the related parties
reflecting arms length consideration payable for similar services or
transfers.  (Other related party transactions are disclosed in Note
6.)








NOTE
6:                      CAPITAL
STOCK





Share
Capital


The
Company’s capitalization is 50,000,000 authorized preferred shares with a par
value of $1.00 per share and 200,000,000 common shares with no par
value.





Common
Share Transactions


During
the six months ended June 30, 2009, the Company completed the following equity
transactions:





In
January, 2009, the Company completed a private placement offering of 125,000
Units, consisting of one share of Common Stock and one Common Stock Purchase
Warrant at a price of $0.04 per Unit for proceeds of $5,000.  The
Warrants are exercisable for a period of two years and entitle the holder to
purchase one share of Common Stock for $0.10 per Share.





In March,
2009, the Company completed a private placement offering of 100,000 Units,
consisting of one share of Common Stock and one Common Stock Purchase Warrant at
a price of $0.05 per Unit for proceeds of $5,000.  The Warrants are
exercisable for a period of two years and entitle the holder to purchase one
share of Common Stock for $0.15 per Share.





In March,
2009, the Company completed a private placement offering of 200,000 Units,
consisting of one share of Common Stock and one Common Stock Purchase Warrant at
a price of $0.05 per Unit for proceeds of $10,000.  The Warrants are
exercisable for a period of two years and entitle the holder to purchase one
share of Common Stock for $0.10 per Share







7


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)







NOTE
6:                      CAPITAL
STOCK (continued)





Common
Share Transactions (continued)


In March,
2009, the Company issued 500,000 shares of Common Stock with a fair value of
$0.05 per share or $25,000, pursuant to a letter agreement, as partial
satisfaction of outstanding debt.





In May,
2009, the Company completed a private placement offering of 500,000 Units,
consisting of one share of Common Stock and one Common Stock Purchase Warrant at
a price of $0.03 per Unit for proceeds of $15,000.  The Warrants are
exercisable for a period of three years and entitle the holder to purchase one
share of Common Stock for $0.05 per Share.





Stock-Based
Compensation and Other Equity Transactions


The
Company does not have a stock-based compensation plan.  The Company’s
Compensation Committee makes recommendations to the Board of Directors for the
granting of awards of stock options to its officers and directors on a
case-by-case basis.





Total
compensation expense for the six months ended June 30, 2009 was $16,484, which
corresponds to the vesting schedule of two to three years.  As of June
30, 2009, the total compensation expense related to non-vested awards to be
recognized in future periods is $7,500.  This expense will be
recognized ratably during 2009. Below is a summary of the stock option activity
for the six months ended June 30, 2009:


WeightedNumber
      of
                                                                          
                                                                          
                                                                          AverageOptions
                                                                          
                                                                          
                                                                          Exercise
      PriceTotal
      Options
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          $Outstanding,
      December 31, 2007
                                                                          
                                                                          
                                                                          5,975,000
                                                                          
                                                                          
                                                                          
                                                                          0.235Cancelled
      March 4, 2008
                                                                          
                                                                          
                                                                          (400,000
                                                                          )
                                                                          
                                                                          
                                                                          0.200Granted
      April 9, 2008
                                                                          
                                                                          
                                                                          150,000
                                                                          
                                                                          
                                                                          
                                                                          0.280Outstanding,
      December 31, 2008
                                                                          
                                                                          
                                                                          5,725,000
                                                                          
                                                                          
                                                                          
                                                                          0.239Expired
                                                                          
                                                                          
                                                                          -
                                                                          
                                                                          
                                                                          
                                                                          -Granted
                                                                          
                                                                          
                                                                          -
                                                                          
                                                                          
                                                                          
                                                                          -Outstanding,
      June 30, 2009
                                                                          
                                                                          
                                                                          5,725,000
                                                                          
                                                                          
                                                                          
                                                                          0.239Nonvested
      Options
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          $Nonvested
      options, December 31, 2007
                                                                          
                                                                          
                                                                          1,150,000
                                                                          
                                                                          
                                                                          
                                                                          0.11Granted
      April 9, 2008
                                                                          
                                                                          
                                                                          150,000
                                                                          
                                                                          
                                                                          
                                                                          0.12Vested
                                                                          
                                                                          
                                                                          (1,075,000
                                                                          )
                                                                          
                                                                          
                                                                          0.11Nonvested
      options December 31, 2008
                                                                          
                                                                          
                                                                          225,000
                                                                          
                                                                          
                                                                          
                                                                          0.11Vested
                                                                          
                                                                          
                                                                          (158,333
                                                                          )
                                                                          
                                                                          
                                                                          0.11Nonvested
      options June 30, 2009
                                                                          
                                                                          
                                                                          66,667
                                                                          
                                                                          
                                                                          
                                                                          0.25





The
following tables summarize information and terms of the options outstanding and
exercisable:


Options
      Outstanding at June 30, 2009
                      
                      Options
      Exercisable at June 30, 2009Weighted
                      
                      
                      
                      WeightedAverage
                      
                      
                      
                      AverageRemaining
                      Weighted
                      
                      
                      Remaining
                      WeightedRange
      of
                      Number
                      Contractual
                      Average
                      
                      Number
                      Contractual
                      AverageExercise
      Prices
                      of
      Shares
                      Life
      (in years)
                      Exercise
      Price
                      
                      of
      Shares
                      Life
      (in years)
                      Exercise
      Price$
      0.20 – 0.28
                      5,725,000
                      1.73
                      $      0.239
                      
                      5,658,333
                      1.72
                      $     0.236
 
 
 8


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)













Stock-Based
Compensation and Other Equity Transactions (continued)





Options
      Outstanding at December 31, 2008
                                  
                                  Options
      Exercisable at December 31, 2008Weighted
                                  
                                  
                                  
                                  WeightedAverage
                                  
                                  
                                  
                                  AverageRange
      of
                                  
                                  Remaining
                                  Weighted
                                  
                                  
                                  Remaining
                                  WeightedExercise
                                  Number
                                  Contractual
                                  Average
                                  
                                  Number
                                  Contractual
                                  AveragePrices
                                  Of
      Shares
                                  Life
      (in years)
                                  Exercise
      Price
                                  
                                  of
      Shares
                                  Life
      (in years)
                                  Exercise
      Price$
      0.20 – 0.28
                                  5,725,000
                                  2.23
                                  $      0.239
                                  
                                  5,500,000
                                  2.135
                                  $     0.238





The
outstanding and exercisable stock options had no intrinsic value at June 30,
2009.





Common Stock Purchase
Warrants


Total
outstanding warrants at June 30, 2009 were 8,591,535.  The exercise
prices on all warrants range from $0.05 to $0.60 per share. The warrants are
exercisable immediately upon issuance and the expiration dates range between two
years and five years after the date of issuance.





During
the six months ended June 30, 2009, the Company issued warrants relating to unit
private placements granting holders the right to purchase 925,000 shares of
common stock.  The exercise prices on these warrants range from $0.05
to $0.15 per share. The warrants were exercisable immediately upon issuance and
the expiration dates are two and three years after issuance.  The
Company estimated the total fair market value of these warrants to be $13,900 at
the date of grant, using the BSM pricing model using an expected life of one
year, a risk-free interest rate of 4.45% and an expected volatility of
109%.  The fair value of the warrants has been included in capital
stock.





The
warrants exercisable at June 30, 2009 had no intrinsic value.





A summary
of the Company’s stock purchase warrants as of June 30, 2009  is
presented below:





Number
      of
                        Warrants
                      Weighted
      average
                        exercise
      price
                      Weighted
      average
                        remaining
      life (years)$Balance,
      December 31, 2008
                      10,479,035
                      0.320
                      1.09Exercised
                      -Expired
                      (2,812,500)Issued
                      925,000
                      0.078
                      1.96Balance,
      June 30, 2009
                      8,591,535
                      0.333
                      0.76





NONCASH
INVESTING AND FINANCING ACTIVITIES





In March,
2009, the Company issued 500,000 shares of Common Stock with a fair value of
$0.05 per share or $25,000, pursuant to a letter agreement as partial
satisfaction of outstanding debt.


Six
      monthsended
                      June
      30, 2009
                    Six
      monthsended
                      June
      30, 2008$
                    $Interest
      paid
                    -
                    -Income
      taxes paid
                    -
                    -







9


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS


JUNE
30, 2009


(unaudited)













In July,
2009, the Company completed a private placement offering of 83,333 Units,
consisting of one share of Common Stock and one Common Stock Purchase Warrant at
a price of $0.06 per Unit for proceeds of $5,000.  The Warrants are
exercisable for a period of two years and entitle the holder to purchase one
share of Common Stock for $0.10 per Share.





In July,
2009, the Company was granted a 10.5% undivided working interest in an oil well
in Tennessee.







10


Item
2. Management’s Discussion And Analysis Or Plan Of Operations





Forward-Looking
Statements and Associated Risks.





Except
for statements of historical facts, this report contains forward-looking
statements involving risks and uncertainties. You can identify these statements
by forward-looking words including “believes,” “considers,”
“intends,”  “expects,” “may,” “will,” “should,” “forecast, “ or
“anticipates,” or the equivalents of those words or comparable terminology, and
by discussions of strategies that involve risks and uncertainties.
Forward-looking statements are not guarantees of our future performance or
results, and our actual results could differ materially from those anticipated
in these forward-looking statements. We wish to caution readers to consider the
important factors, among others, that in some cases have affected, and in the
future could affect our actual results and could cause actual consolidated
results for future fiscal years to differ materially from those expressed in any
forward-looking statements made by us or on our behalf. These factors include
without limitation, our ability to obtain capital and other financing in the
amounts and at the times needed, identification of suitable exploration
properties for acquisition, the successful discovery of gold, silver or other
precious metals in quantities economically feasible for profitable production,
changes in gold and silver prices, changes in the political climate for gold and
silver exploration, and other risk factors listed from time to time in our
Securities and Exchange Commission reports, including in particular the factors
and discussions under the heading “Risk Factors” in the Annual Report on Form
10-K for the year ended December 31, 2008  that was filed with the
Securities and Exchange Commission on March 31, 2009.





Overview
of Business





We are a North Carolina corporation
formed in 1983. From our inception until 1992, we were engaged in the
exploration for, and production of, gold and other precious metals and the
evaluation of gold properties in North Carolina and South Carolina. From 1983 we
were engaged in exploration and from early 1985 until May 1992, we were also
engaged in the mining and production of gold and silver at our Haile Mine
Property near Kershaw, South Carolina. In May 1992, we entered into a joint
venture at our Haile Mine Property with AGI. Our operations ceased at the Haile
Mine Property in 1994. We did not again become engaged in exploration activities
until 2004, when we relocated our principal place of business to Reno, Nevada.
Since October 2003, we have been an exploration stage company engaged in the
acquisition and exploration of mineral properties. We have now entered into
seven option and earn-in agreements on seven different exploration properties in
the state of Nevada. Our plan is to conduct exploration for gold and silver at
each of these properties and at other properties we may enter into agreements on
to assess whether they possess economic deposits of gold and/or silver, which
can be recovered at a profit. We do not intend to build an exploration staff,
but rather to work with
competent exploration groups who can manage the exploration activities with our
funding, although in some cases we may conduct exploration on our own using
contractors. We do not
know whether a commercially viable ore body will be located on any of our
mineral claims or leased properties. Our current plans are limited to research
and exploration in the state of Nevada.





Going
Concern





The report of our independent auditors
in our December 31, 2008 financial statements includes an explanatory paragraph
indicating that there is substantial doubt about our ability to continue as a
going concern due to recurring losses from operations, an accumulated deficit of
$17,804,754 and a working capital deficit of $622,354 at December 31, 2008. Our
ability to continue as a going concern will be determined by our ability to
raise adequate funds and conduct one or more successful exploration programs.
Our financial statements do not include any adjustments that might result from
the outcome of this uncertainty.







11





Critical
Accounting Policies





The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make a
wide variety of estimates and assumptions that affect: (1) the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities as
of the date of the financial statements, and (2) the reported amounts of
revenues and expenses during the reporting periods covered by the financial
statements. Our management routinely makes judgments and estimates about the
effect of matters that are inherently uncertain. As the number of variables and
assumptions affecting the future resolution of the uncertainties increases,
these judgments become even more subjective and complex. We have identified
certain accounting policies that are most important to the portrayal of our
current financial condition and results of operations.





Results
of Operations





Discussion
of Revenues




We have no revenues at this time and
have not had any revenues in recent years, because we are an exploration
company. We do not anticipate that significant revenues will be achieved until
we


either:





·
                locate
      one or more economic mineral deposits which could then be put into
      production, from which we would then be able to extract gold or silver at
      a profit; or·
                enter
      into a joint venture arrangement on one or more of our leased properties;
      or




There is
no guarantee that our exploration activities will locate viable gold and/or
silver reserves, or if an economic mineral deposit were discovered that we would
be able to commence commercial production, or that if we do locate viable
mineralization that we would be able to secure the funding necessary to proceed
with the mining and production of the ore.




Expenses
for the Six Month Period ending June 30, 2009 vs. June 30, 2008


Expenses for the
Three Month Period ending June 30, 2009 vs. June 30, 2008





Exploration,
geological and geophysical costs decreased by $115,532, or (98.76%) to
$1,449 for the three months ended June 30, 2009 as compared to $116,981 for the
three months ended June 30, 2008.  The principal reason for this
decrease was due to a decrease in exploration activity due to a lack of
funding.





Exploration,
geological and geophysical costs decreased by $161,297, or (84.47%) to
$29,645 for the six months ended June 30, 2009 as compared to $190,942 for the
six months ended June 30, 2008.  The principal reason for this
decrease was due to a decrease in exploration activity due to a lack of
funding.





Management
fees decreased by $43,500, or (45.86%), to $51,350 for the three months ended
June 30, 2009 as compared to $94,850 for the three months ended June 30,
2008.  The principal reason for this change for the three month period
was due to a decrease of $40,400 in recording the expense of vested options
and a decrease of $2,100 in directors’ fees.





Management
fees decreased by $84,633, or (45.72%), to $100,484 for the six months ended
June 30, 2009 as compared to $185,117 for the six months ended June 30,
2008.  The principal reason for this change
for the six month period was due to a decrease of $86,033 in recording the
expense of vested options, a decrease of $2,600 in directors’ fees and an
increase of $4,000 in the monthly fees paid to the
president.







12





For the three months ended June 30,
2009, professional fees decreased $37,204, or (74.12%),  to $12,992 as
compared to $50,196 for the three months ended June 30, 2008.  This
change for the three month period is due to a decrease in legal fees of $34,475
as the Company had not finalized any new agreements for the quarter and a
decrease in accounting fees of $2,729 due to increased efficiencies
..





For the six months ended June 30, 2009,
professional fees decreased $50,864, or (48.01%),  to $55,072 as
compared to $105,936 for the six months ended June 30, 2008.  This
change for the six month period is due to a decrease in legal fees of $48,955 as
the Company had not finalized any new agreements for the quarter and a decrease
in accounting fees of $1,909 due to increased efficiencies.





Depreciation
expense decreased by $216, or (100%), to $0 for the three months ended June 30,
2009 as compared to $216 for the three months ended June 30,
2008.  The principal reason for this change is attributable to
equipment becoming fully depreciated.





Depreciation expense decreased by $367,
or (84.95%), to $65 for the six months ended June 30, 2009 as compared to $432
for the six months ended June 30, 2008.  The principal reason for this
change is attributable to equipment becoming fully depreciated





Liquidity and Financial Condition




Cash
and Working Capital




We had an accumulated deficit of
($17,804,754) from our inception in 1983 to December 31, 2008, and an
accumulated deficit of ($18,042,780) at June 30, 2009.  We had a
working capital deficit of $802,535 at June 30, 2009.  We have no
contingencies or long-term obligations except for our work commitments described
under our seven (7) property agreements on our leased properties. All of these
agreements can be terminated by us upon either 30 or 60 days
notice.




We had a
cash balance of $582 on December 31, 2008 and a cash balance of $276 on June 30,
2009.  For the six months period ending June 30, 2009, we had net cash
outflows of $306.





The cash
flows used in operations for the six month period ended June 30, 2009 were
$34,603 compared with $744,732 for the same period in 2008.  Cash
flows used in operations for the six month period ended June 30, 2009 consisted
primarily of a net loss of $238,027 including stock based compensation
of  $16,484, with changes in working capital assets and liabilities
consisting of a net decrease in prepaid expenses of $28,007,
an  increase in accounts payable and accrued liabilities of $38,976
and an increase of $119,892 to accrued expenses for amounts unpaid to related
parties..





Net cash
flows provided by equity financing activities were $35,000 versus $650,450
during the same period in 2008.


13


Internal
and External Sources of Liquidity




During
the forthcoming 12 month period, we plan to fund our operations through
issuances of Common Stock or Common Stock with warrants, by advances from
management and from cash flow provided by interests in oil and gas
wells.  However, there is no guarantee or assurance that this will be
achieved. In the event, we are unable to raise additional capital, we may not be
able to meet our obligations and may be required to curtail or terminate some of
our planned exploration programs





Contractual
Obligations




We have
no commitments for capital expenditures.





We do not
engage in hedging transactions and we have no hedged mineral
resources.




At June
30, 2009 we are committed to making certain exploration work expenditures, lease
and option payments, and claims maintenance payments on properties as
follows.





Bullion Mountain Gold
Project:





·
            Required
      work expenditure by November 11, 2006:  $20,000 of which $27,305
      has already been expended.  In September, 2007, this agreement
      was amended and the time for completing the remaining work obligation was
      extended indefinitely.




·
            Claims
      maintenance: $8,651 has been paid through August 31, 2008. $2,940 to be
      paid by September 1, 2009




·
            Annual
      payments:  $15,000 has been accrued, of which $3,000 has been
      paid. An additional $15,000 will be due on November 1,
    2009.





Trinity Silver
Project:





·
            Required
      work expenditure: $800,000, of which $629,408 was expended through June
      30, 2009.  The remaining approximately $370,000 to be completed
      by September 2009.  Further work will depend upon the timing and
      receipt of additional funds.·
            Claims
      maintenance:  $21,579 has been paid through August 31,
      2008.  $8,260 due by September 30,
  2009.




·
            Annual
      payments:  $0.





Pasco
Canyon Gold Project:





·
            Required
      work expenditure:  $57,355 has already been completed.
      Further work postponed pending receipt of drill permit from U.S. Forest
      Service, and the receipt of additional
funds.




·
            Claims
      maintenance: $9,416 has been paid through August 31,
      2008.  $3,360 due by September 1,
  2009.




·
            Annual
      payments; $0.







14


Dutch
Flat Gold Project:





·
            Required
      work expenditure:  $500,000 by March 31, 2009, of which $543,516
      was expended as of June 30, 2009.  Further work will depend upon
      the timing and receipt of additional
funds.




·
            Claims
      maintenance; $15,451 has been paid through August 31,
      2008.  $15,960 due by August 20,
2009.




·
            Annual
      payments; $0.





PPM
Gold Project:





·
            Required
      work expenditure for first year; $175,000, of which $142,702 has been
      expended.  The difference is expected to be expended in the near
      future.  The timing and amount of additional work will depend
      upon the timing and amount of funding received.  Both parties
      wish to continue with the planned exploration program for the
      property.




·
            Claims
      maintenance:  $28,781 has been paid through August 31,
      2008.  $6,860 due by September 1,
  2009.




·
            Annual
      payments; $0.





Willow
Creek Gold Project:




·
                      Option
      and Earn-in Agreement was signed. Initial signing fee of $10,000 was paid
      in December, 2007.  A cash advance of $300,000 was deposited for
      the first year’s exploration costs. In addition, 100,000 common shares
      were issued in July, 2008 valued at $15,000 in accordance with the Option
      and Earn-in Agreement. As at June 30, 2009, the cash on deposit was
      $2,424, and $297,576 of those funds had been expended along with an
      additional $12,584 for a total expenditure of $308,363, including a refund
      of $1,797 on the reclamation bond, to complete the first year work
      commitment.  Additional work will depend upon the amount and
      timing of the receipt of additional funds.·
                      Claims
      Maintenance:  $22,120 will be due by September 1, 2009, of which
      $5,460 has been paid.·
                      Annual
      Payments:  $10,000 on each anniversary of the agreement of which
      $10,000 was due in June, 2009, and has been
  accrued.




Morgan
Pass Gold Project:





·
              On
      May 20, 2008, a Letter of Intent was signed on the Morgan Pass
      Project.  The option and earn in agreement will not be prepared
      and signed until the property is released into ‘multiple use’
      classification by the Bureau of Land Management. Funds of $14,351 have
      been expended to date.   Claims maintenance fees of $3,080
      due by September 1, 2009.






15


Argentite
Gold Project:


·
                On
      March 10, 2009, upon paying $2,500, the Company signed a Letter of Intent
      to enter into an Exploration Agreement with Option to form Joint Venture
      on the Argentite gold property in western
      Nevada once the gold price exceeds $1,000 per ounce for more than 25
      consecutive business days or after 90 days from the date of signing the
      Letter of Intent.  On signing the formal agreement, the Company
      will pay $8,000 and will then undertake a work commitment of $750,000 over
      a five year period to earn a 51% interest in the property and the project,
      or up to a 70% interest upon completion of a bankable feasibility
      study.  In addition, the Company would make annual payments of
      $10,000 by the first anniversary of the agreement, $15,000 on the second
      anniversary, $20,000 by the third anniversary and $25,000 by the fourth
      anniversary, all of which would be creditable against the work commitment.
      The Option and Earn-in Agreement has not yet been prepared or
      signed.  Claims maintenance fees of $1,120 due by September 1,
      2009.




All of these property agreements can be
terminated on 30 to 60 days advance notice





Off-Balance
Sheet Arrangements




We have no off-balance sheet
arrangements.





We do not
engage in hedging transactions and we have no hedged resources.








Item
3. Quantitative and Qualitative Disclosure About Market Risks





Not Applicable.








Item
4T. Controls And Procedures





(A)          Evaluation
of Disclosure Controls and Procedures





Disclosure controls and procedures are
designed to ensure that information required to be disclosed in the reports
filed or submitted by us under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported, within the time periods specified in the
rules and forms of the Securities and Exchange Commission. Disclosure controls
and procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed in the reports filed under the
Securities Exchange Act of 1934 is accumulated and communicated to our
management, including our principal executive and financial officers, as
appropriate, to allow timely decisions regarding required
disclosure.





We carried out an evaluation, under the
supervision and with the participation of our management, including our
principal executive officer and principal financial officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures as of the end of the period covered by this report. Based upon and as
of the date of that evaluation, our principal executive officer and financial
officers concluded that there were material weaknesses in our internal controls,
including those which relate to the review, approval and reconciliation of
accounting data and entries. Accordingly, we believe that our disclosure
controls and procedures were ineffective as of the end of the period covered by
this quarterly report.  We are addressing these issues by reviewing
and revising our internal accounting policies and procedures.







16





(B)           Changes
in Internal Control Over Financial Reporting





There has
been no change in our internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting, except that we continue to look for ways to
improve our internal controls.








PART
II – OTHER INFORMATION




Item
1. Legal Proceedings





To the
best knowledge of management, there are no material legal proceedings pending
against the Company.





Item
1A. Risk factors





Not Applicable.





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





In May,
2009, the Company completed a private placement offering of 500,000 Units,
consisting of one share of Common Stock and one Common Stock Purchase Warrant at
a price of $0.03 per Unit for proceeds of $15,000.  The Warrants are
exercisable for a period of three years and entitle the holder to purchase one
share of Common Stock for $0.05 per Share.





The
issuances of Common Stock was made by us in reliance upon the exemptions from
registration provided under Section 4(2) and 4(6) of the Securities Act and Rule
506 of Regulation D, promulgated by the SEC under federal securities laws and
comparable exemptions for sales to “accredited” investors under state securities
laws.





Item
3. Defaults Upon Senior Securities





None.





Item
4. Submission Of Matters To A Vote Of Security Holders





None.





Item
5. Other Information





None.





Item
6. Exhibits





Exhibit
      No.
                    Description33131.1
                    Certification
      Pursuant to Section 302*33232.1
                    Certification
      Pursuant to 18 U.S.C. Section
1350*


________________


*Filed
herewith




17


SIGNATURES





Pursuant to the requirements of the
Securities and Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned thereunto duly
authorized.





PIEDMONT
      MINING COMPANY, INC.,
                  a
      North Carolina CorporationDated:
      August 13, 2009
                /s/ Robert M. Shields, Jr.By:  Robert
      M. Shields, Jr.
                  Its:  Chief
      Executive Officer (Principal
                  Executive
      Officer) and Chief Financial Officer
                  (Principal
      Financial Officer and Principal Accounting
  Officer)









18


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