UNITED STATES
SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-QSB





(Mark
One)




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




For the
Quarterly Period Ended March 31, 2008




 ̈ 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.  333-135376





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 is a shell company (as defined in Rule
12b-2 of the Exchange Act.)


Yes  ̈                      No
x


As
of  May 3, 2008 there were 64,328,645 outstanding shares of the
issuer’s common stock.





Transitional
Small Business Disclosure Format (Check one):


Yes  ̈                      No
x











PIEDMONT
MINING COMPANY, INC.





FORM
10-QSB INDEX





Page
      NumberPART
      I – FINANCIAL INFORMATIONItem
      1. Financial StatementsConsolidated
      Balance Sheets as of  March 31, 2008 (unaudited) and December
      31, 2007
            3Consolidated
      Statements of Loss for the Three Months Ended March 31, 2008 and 2007,
      (unaudited)
            4Consolidated
      Statements of Cash Flows for the Three Months Ended March 31, 2008 and
      2007 (unaudited)
            5Notes
      to Consolidated Financial Statements (unaudited)
            6Item
      2. Management’s Discussion and Analysis or Plan of
    Operation
            20Item
      3. Controls and Procedures
            24PART
      II – OTHER INFORMATIONItem
      1. Legal Proceedings
            25Item
      2. Unregistered Sales of Equity Securities and Use of
    Proceeds
            25Item
      3. Defaults Upon Senior Securities
            25Item
      4. Submission of Matters to a Vote of Security Holders
            26Item
      5. Other Information
            26Item
      6. Exhibits
            26Signature
      Page
            27










PART
I – FINANCIAL INFORMATION





Item
1. Financial Statements





PIEDMONT
MINING COMPANY, INC.
 (An
Exploration Stage Company)
 CONSOLIDATED
BALANCE SHEETS
 
 March
      31,
                
                
                December
      31,2008
                  (unaudited)
                
                
                2007
                  (audited)CURRENT
      ASSETS
                
                $
                
                
                $Cash
      and cash equivalents
                
                
                3,430
                
                
                
                165,877Prepaid
      expenses and other
                
                
                12,567
                
                
                
                21,168Total
      current assets
                
                
                15,997
                
                
                
                187,045MINERAL
      PROPERTIES (Note 3)
                
                
                285,500
                
                
                
                275,500PROPERTY
      AND EQUIPMENT (Note 4)
                
                
                713
                
                
                
                929Total
      Assets
                
                
                302,210
                
                
                
                463,474
 
 CURRENT
      LIABILITIESAccounts
      payable and accrued liabilities
                
                
                310,426
                
                
                
                322,149Due
      to related parties (Note 5)
                
                
                96,550
                
                
                
                83,008Total
      current liabilities
                
                
                406,976
                
                
                
                405,157
 
 STOCKHOLDERS’
      EQUITY (DEFICIENCY)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:  63,192,312 common (2007 –
      63,063,774)
                
                
                15,738,185
                
                
                
                15,700,695Additional
      paid-in capital
                
                
                782,809
                
                
                
                730,042Deficit accumulated prior to the
      exploration stage
                
                
                (12,564,287
                )
                
                
                (12,564,287
                )Deficit
      accumulated during exploration stage
                
                
                (4,061,473
                )
                
                
                (3,808,133
                )Total
      stockholders’ equity (deficiency)
                
                
                (104,766
                )
                
                
                58,317Total
      liabilities and stockholders’ equity (deficiency)
                
                
                302,210
                
                
                
                463,474
 
 
 
 The
accompanying notes are an integral part of these financial
statements.
  3




PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


CONSOLIDATED
STATEMENTS OF LOSS


(unaudited)





Three
      months Ended
              March
      31, 2008
            
            
            Three
      months Ended
              March
      31, 2007
            
            
            For
      the Period from January 1, 2002 (Date of Inception of Exploration
      Stage) to
              March
      31, 2008$
            
            
            $
            
            
            $EXPENSESDepreciation
            
            
            216
            
            
            
            465
            
            
            
            145,670Exploration,
      geological and geophysical costs
            
            
            73,961
            
            
            
            83,469
            
            
            
            1,876,218General
      and administrative
            
            
            35,354
            
            
            
            40,895
            
            
            
            722,847Management
      fees
            
            
            91,267
            
            
            
            109,365
            
            
            
            628,938Professional
      fees
            
            
            55,740
            
            
            
            60,232
            
            
            
            652,435256,538
            
            
            
            294,426
            
            
            
            4,026,108LOSS
      BEFORE OTHER ITEMS
            
            
            (256,538
            )
            
            
            (294,426
            )
            
            
            (4,026,108
            )INTEREST
      INCOME
            
            
            3,198
            
            
            
            1
            
            
            
            11,225LOSS
      ON OTHER NON-OPERATING ACTIVITIES
            
            
            -
            
            
            
            -
            
            
            
            (46,590
            )NET
      LOSS
            
            
            (253,340
            )
            
            
            (294,425
            )
            
            
            (4,061,473
            )BASIC
      AND DILUTEDLOSS  PER
      SHARE
            
            
            (0.004
            )
            
            
            (0.006
            )WEIGHTED
      AVERAGE COMMONSHARES
      OUTSTANDING, BASICAND
      DILUTED
            
            
            63,109,248
            
            
            
            51,607,068














The
accompanying notes are an integral part of these financial
statements





4


PIEDMONT
MINING COMPANY, INC.


(An
Exploration Stage Company)


CONSOLIDATED
STATEMENTS OF CASH FLOWS


(unaudited)




Three
      Months Ended
              March
      31,
            
            
            For
      the Period from January 1, 2002 (Date of Inception of Exploration Stage)
      to
              March
      31,2008
            
            
            2007
            
            
            2008$
            
            
            $
            
            
            $CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
            
            
            (253,340
            )
            
            
            (294,425
            )
            
            
            (4,061,473
            )Adjustments
      to reconcile net loss to net cash from operating
    activities:Warrants
      issued as finance fees
            
            
            -
            
            
            
            -
            
            
            
            92,100Stock
      based compensation
            
            
            52,767
            
            
            
            85,365
            
            
            
            319,634Depreciation
            
            
            216
            
            
            
            465
            
            
            
            145,670Loss
      on other non-operating activities
            
            
            -
            
            
            
            -
            
            
            
            (21,000
            )Changes
      in operating assets and liabilities:Prepaid
      expenses and other
            
            
            8,601
            
            
            
            14,260
            
            
            
            (9,617
            )Accounts
      payable and accrued liabilities
            
            
            1,819
            
            
            
            86,059
            
            
            
            367,519NET
      CASH FLOWS USED INOPERATING
      ACTIVITIES
            
            
            (189,937
            )
            
            
            (108,276
            )
            
            
            (3.167.167
            )CASH
      FLOWS FROM FINANCING ACTIVITIESIssuance
      of shares for cash, net of issuance costs
            
            
            37,490
            
            
            
            83,750
            
            
            
            3,037,214Related
      party advances (repayments)
            
            
            -
            
            
            
            9,000
            
            
            
            (14,005
            )Convertible
      notes
            
            
            -
            
            
            
            -
            
            
            
            291,145NET
      CASH FLOWS FROMFINANCING
      ACTIVITIES
            
            
            37,490
            
            
            
            92,750
            
            
            
            3,314,354CASH
      FLOWS FROM INVESTING ACTIVITIESPurchase
      of property and equipment
            
            
            -
            
            
            
            -
            
            
            
            (5,579
            )Proceeds
      from non-operating activities
            
            
            -
            
            
            
            -
            
            
            
            97,125Mineral
      property costs
            
            
            (10,000
            )
            
            
            -
            
            
            
            (236,000
            )NET
      CASH FLOWS USED ININVESTING
      ACTIVITIES
            
            
            (10,000
            )
            
            
            -
            
            
            
            (144,454
            )INCREASE
      (DECREASE) IN CASH ANDCASH
      EQUIVALENTS
            
            
            (162,447
            )
            
            
            (15,526
            )
            
            
            2,733CASH
      AND CASH EQUIVALENTS, BEGINNING
            
            
            165,877
            
            
            
            17,222
            
            
            
            697CASH AND CASH EQUIVALENTS,
      ENDING
            
            
            3,430
            
            
            
            1,696
            
            
            
            3,430SUPPLEMENTAL
      CASH FLOW INFORMATION ANDNON-CASH INVESTING AND
      FINANCING ACTIVITIES (Note 7)














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


5




NOTE
1:                   
  NATURE OF OPERATIONS








Piedmont
Mining Company, Inc. (the Company) was formed in 1983 under the laws of North
Carolina, USA and is currently in the exploration stage, which is characterized
by significant expenditures for the examination and development of exploration
properties.  As a result, 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 2003 and began reporting under exploration stage
guidelines.





The
Company has entered into option and earn-in agreements on seven (7) different
exploration properties in the state of Nevada and may opt to acquire one or more
of the properties that the Company currently leases pursuant to option and
earn-in agreements. Management’s plan is to conduct exploration for gold and
silver at these properties and at other properties it may enter into agreements
on to assess whether they might possess economic deposits of gold and/or silver
which could be recovered at a profit. The Company does not intend to build an
exploration staff but rather to work with competent exploration groups who can
manage the exploration activities on these properties with the Company’s
funding.





The
Company’s focus for the foreseeable future will be on exploration of its various
existing mineral properties and exploration of new 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.  In April 2006 the Company commenced exploration on
the Trinity Silver Project in Pershing County, Nevada. (Note 3)





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 $390,979 and a deficit of $16,625,760 at
March 31, 2008. This
creates an uncertainty as to how the Company will fund its operations and
maintain sufficient cash flow to operate 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 intends to fund its ongoing operations by way of private placements of
its securities as may be required.  Since 2002, private placements of
stock with warrants and the exercise of some of those warrants have resulted in
total cash proceeds of $2,037,214 through March 31, 2008.





Management
believes these efforts 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 Company’s
ability to meet its cash requirements in the next year is dependent upon its
continuing to obtain financing and satisfying certain obligations, such as
compensating its officers and consultants either through monetary means or the
granting of stock options.  If this is not achieved, there is
substantial doubt the Company may be able to continue as a going
concern.








6





NOTE
1:                      NATURE
OF OPERATIONS (continued)





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-QSB of Regulation S-B. 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, 2007, included in the
Company’s form 10-KSB filed with the Securities and Exchange Commission. The
unaudited interim consolidated financial statements should be read in
conjunction with those financial statements included in the Form 10-KSB. 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 three months ended March 31, 2008 are not necessarily
indicative of the results that may be expected for the year ending Decembe31,
2008.


NOTE
2:                      SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES





Basis
of  Presentation


These
financial statements are presented in United States dollars and have been
prepared in accordance with accounting principals generally accepted in the
United States of America.





Basis
of Consolidation


The
accompanying consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries, NetColony, LLC and Piedmont Gold
Company, Inc.   Neither subsidiary has material operations,
tangible assets or liabilities.  All significant intercompany accounts
and transactions, if any, have been eliminated in consolidation.





Cash
and Cash Equivalents


The
Company considers all highly liquid instruments with an original maturity of
three months or less at the time of issuance to be cash
equivalents.





Comparative
Figures


Certain
comparative figures have been reclassified in order to conform to the current
year’s financial statement presentation.





Use
of Estimates


The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the
period.  Actual results could differ from those
estimates.  Significant areas requiring management’s estimates and
assumptions are determining the fair value of shares of common stock,
convertible debentures and financial instruments. Other areas requiring
estimates include deferred tax balances, valuation allowances, allocations of
expenditures to mineral property interests and asset impairment
tests.








7


NOTE
2:                      SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES  (continued)





Mineral
Property Costs


The
Company is primarily engaged in the acquisition, exploration and development of
mineral properties.  Pursuant to Emerging Issues Task Force (EITF)
04-02, mineral rights are capitalized at cost. This includes lease payments
under exploration agreements.  The projects are assessed for
impairment when facts and circumstances indicate their carrying values exceed
the recoverable values, such as failure to discover mineable ore.  If
a mineable ore body is found, these costs will be amortized when production
begins using a units-of-production method.  These costs are recorded to
exploration projects on the consolidated balance sheets.  Other
exploration, geological costs and research and development costs are expensed as
incurred





In the
event that mineral property acquisition costs are paid or settled with Company
shares, those shares are valued at market at the time the shares are
issued.





When it
has been determined that a mineral property can be economically developed as a
result of establishing proven and probable reserves and pre-feasibility, the
costs incurred to develop such property to production are
capitalized.





Estimated
future removal and site restoration costs, when determinable are provided over
the life of proven reserves on a units-of-production basis.  Costs,
which include production equipment removal and environmental remediation, are
estimated each period by management based on current regulations, actual
expenses incurred, and technology and industry standards.  Any charge
is included in exploration expense or the provision for depletion and
depreciation during the period and the actual restoration expenditures are
charged to the accumulated provision amounts as incurred.





As of the
date of these financial statements, all of the Company’s exploration costs have
been expensed.





To date
the Company has not established any proven or probable reserves on its mineral
properties.





Asset
Retirement Obligations


The
Company has adopted the provisions of SFAS No. 143 "Accounting for Asset
Retirement Obligations," which establishes standards for the initial measurement
and subsequent accounting for obligations associated with the sale, abandonment
or other disposal of long-lived tangible assets.  The adoption of this
standard has had no effect on the Company's financial position or results of
operations.  To December 31, 2007 any potential costs relating to the
ultimate disposition of the Company's mineral property interests are not
determinable.





Impairment
of Long-Lived Assets


The
Company reviews property and equipment and certain identifiable intangibles,
excluding goodwill, for impairment in accordance with SFAS No. 144, Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of. Long-lived assets are reviewed for impairment whenever events or changes in
circumstances indicate the carrying amount of an asset may not be
recoverable.  Recoverability of these assets is measured by comparison
of its carrying amount to future undiscounted cash flows the assets are expected
to generate.  If property, plant, and equipment and certain
identifiable intangibles are considered to be impaired, the impairment to be
recognized equals the amount by which the carrying value of the assets exceeds
fair market value.  For the three months ended March 31, 2008 and the
fiscal year ended December 31, 2007, the Company had no material impairment of
its long-lived assets.








8


NOTE
2:                      SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES  (continued)





Financial
Instruments


The fair
values of cash and cash equivalents, accounts payable and accrued liabilities
and amounts due to related parties were estimated to approximate their carrying
values due to the immediate or short-term maturity of these financial
instruments.  The fair value of the Company’s net smelter royalty
obligations (refer to Note 3) is not determinable at the current stage of the
Company’s exploration program.  Accordingly, no value has been
assigned by management.   The Company’s operations and financing
activities are conducted primarily in United States dollars, and as a result the
Company is not subject to significant exposure to market risks from changes in
foreign currency rates.  Management has determined that the Company is
not exposed to significant credit risk.





Loss
per Common Share


Basic
loss per share (“LPS”) includes no dilution and is computed by dividing loss
attributable to common stockholders by the weighted average number of common
shares outstanding for the period.  Diluted earnings per share
reflects the potential dilution of securities that could share in the earnings
(loss) of the Company.  The common shares potentially issuable upon
exercise of stock options and warrants were not included in the calculation of
weighted average number of shares outstanding because the effect would be
anti-dilutive.





Net loss
used in determining basic LPS for the three months ended March 31, 2008 and 2007
was ($253,340) and ($294,425), respectively. The weighted average number of
shares of common stock used in determining basic LPS for the three months ended
March 31, 2008 and 2007 was 63,109,248 and 51,607,068,
respectively.





Foreign
Currency Translation


The
financial statements are presented in United States dollars.  In
accordance with SFAS No. 52, “Foreign Currency Translation”, foreign denominated
monetary assets and liabilities are translated to their United States dollar
equivalents using foreign exchange rates which prevailed at the balance sheet
date.  Revenue and expenses are translated at average rates of
exchange during the year. Related translation adjustments are reported as a
separate component of stockholders’ equity, whereas gains or losses resulting
from foreign currency transactions are included in results of
operations.





Income
Taxes


The
Company follows the liability method of accounting for income
taxes.  Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax balances.  Deferred tax assets and liabilities
are measured using enacted or substantially enacted tax rates expected to apply
to the taxable income in the years in which those differences are expected to be
recovered or settled.  The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that
includes the date of enactment or substantive enactment.  As at March
31, 2008, the Company had net operating loss carry forwards; however, due to the
uncertainty of realization, the Company has provided a full valuation allowance
for the potential deferred tax assets resulting from these losses carry
forwards.





Stock-Based
Compensation


On
January 1, 2006, the Company adopted SFAS No. 123 (revised 2004) (SFAS No.
123R), Share-Based Payment, which addresses the accounting for stock-based
payment transactions in which an enterprise receives employee services in
exchange for (a) equity instruments of the enterprise or (b) liabilities that
are based on the fair value of the enterprise’s equity instruments or that may
be settled by the issuance of such equity instruments.  In January
2005, the Securities and Exchange Commission (SEC) issued Staff Accounting
Bulletin (SAB) No. 107, which provides supplemental implementation guidance for
SFAS No. 123R. SFAS No. 123R eliminates the ability to account for stock-based
compensation transactions using the intrinsic value method under Accounting
Principles Board (APB) Opinion No. 25, Accounting for


9


NOTE
2:                      SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES  (continued)





Stock-Based
Compensation (continued)


Stock
Issued to Employees, and instead generally requires that such transactions be
accounted for using a fair-value-based method.  The Company uses the
Black-Scholes-Merton (“BSM”) option-pricing model to determine the fair-value of
stock-based awards under SFAS No. 123R, consistent with that used for
pro


forma
disclosures under SFAS No. 123, Accounting for Stock-Based
Compensation.  The Company has elected the modified prospective
transition method as permitted by SFAS No. 123R and accordingly prior periods
have not been restated to reflect the impact of SFAS No. 123R.  The
modified prospective transition method requires that stock-based compensation
expense be recorded for all new and unvested stock options, restricted stock,
restricted stock units, and employee stock purchase plan shares that are
ultimately expected to vest as the requisite service is rendered beginning on
January 1, 2006 the first day of the Company’s fiscal year
2006.  Stock-based compensation expense for awards granted prior to
January 1, 2006 is based on the grant date fair-value as determined under the
pro forma provisions of SFAS No. 123





Property
and Equipment


Property
and equipment is comprised of computer equipment that is recorded at cost and
amortized over 3 years on a straight-line basis.






Registration
Payment Arrangements


On
January 1, 2007, the Company adopted FSP EITF 00-19-02, Accounting for
Registration Payment Arrangements (“FSP 00-19-2”) which addresses accounting for
registration payment arrangements.  FSP 00-19-2 specifies that the
contingent obligation to make future payments or otherwise transfer
consideration under a registration payment arrangement, whether issued as a
separate agreement or included as a provision of a financial instrument or other
agreement, should be separately recognized and measured in accordance with FASB
Statement No. 5, Accounting for Contingencies.  FSP 00-19-2 further
clarifies that a financial instrument subject to a registration payment
arrangement should be accounted for in accordance with other applicable
generally accepted accounting principles without regard to the contingent
obligation to transfer consideration pursuant to the registration payment
arrangement.





Recent
Accounting Pronouncements


In
February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
Financial Assets and Financial Liabilities”. This Statement permits entities to
choose to measure many financial assets and financial liabilities at fair value.
Unrealized gains and losses on items for which the fair value option has been
elected are reported in earnings. SFAS No. 159 is effective for fiscal years
beginning after November 15, 2007. The adoption of this statement did not
have a material effect on the Company's financial statements.





In
December 2007, the FASB issued SFAS No. 160, "Non-controlling Interests in
consolidated Financial Statements - an Amendment of ARB No. 51." This statement
requires that non-controlling or minority interests in subsidiaries be presented
in the consolidated statement of financial position within equity, but separate
from the parents' equity, and that the amount of the consolidated net income
attributable to the parent and to the non-controlling interest be clearly
identified and presented on the face of the consolidated statement of income.
SFAS No. 160 is effective for the fiscal years beginning on or after December
15, 2008. Currently the Company does not anticipate that this statement will
have an impact on its financial statements.





In
December 2007, the FASB issued SFAS No. 141 (Revised) “Business Combinations”.
SFAS 141 (Revised) establishes principles and requirements for how the acquirer
of a business recognizes and measures in its financial statements the
identifiable assets acquired, the liabilities assumed, and any non-controlling
interest in the acquiree. The statement also provides guidance for recognizing
and measuring the goodwill acquired in the business combination and determines
what information to disclose to enable
   10
 
 NOTE
2:                      SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES  (continued)





Recent
Accounting Pronouncements (continued)


users of
the financial statements to evaluate the nature and financial effects of the
business combination. The guidance will become effective for the fiscal year
beginning after December 15, 2008. Management is in the process of evaluating
the impact, if any, SFAS 141 (Revised) will have on the Company’s financial
statements upon adoption.





In March
2008, the FASB issued SFAS No. 161, Disclosures about Derivative
Instruments and Hedging Activities ("SFAS 161"). SFAS 161 is intended to
improve financial reporting about derivative instruments and hedging activities
by requiring enhanced disclosures to enable investors to better understand their
effects on an entity's financial position, financial performance, and cash
flows. SFAS 161 achieves these improvements by requiring disclosure of the fair
values of derivative instruments and their gains and losses in a tabular format.
It also provides more information about an entity's liquidity by requiring
disclosure of derivative features that are credit risk-related. Finally, it
requires cross-referencing within footnotes to enable financial statement users
to locate important information about derivative instruments. SFAS 161 will be
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, will be adopted by the Company beginning in
the first quarter of 2009. The Company does not expect there to be any
significant impact of adopting SFAS 161 on its financial position, cash flows
and results of operations.








NOTE
3:                     
MINERAL PROPERTIES





A.           Antelope
Ridge Project


Under the
terms of a Mining Lease with Option to Purchase dated April 26th, 2005 (the
“Agreement”), the Company has entered into a Mining Lease with Option to
Purchase on 50 claims in the Fish Creek Mining District, Eureka County, Nevada
(the “Antelope Ridge Project”) for 10 years pursuant to the following
terms:


1.
            Lease
      and option payments required:


(a)         initial
consideration of $4,000 plus federal and county filing fees of $2,406 as well as
payments to each of the two property owners of $3,000 cash and 50,000 shares of
common stock; and a further payment to one of the owners, of $2,000 for
additional claims location costs were made;


(b)         on
April 26, 2006, payments to each of the owners of $5,000 cash and shares of
common stock having a value of $5,000 were made;


(c)         on
April 26, 2007, payments to each of the owners of $7,500 cash and shares of
common stock having a value of $7,500 were made; and


(d)         on
April 26, 2008 and each subsequent anniversary of the effective date, payments
to each of  the Owners of $10,000 cash and shares of common stock
having a value of $10,000 as required.


2.
            The
      Company must expend the following sums on exploration and maintenance of
      the property during the first three years of the
  Agreement:


(a)  Year
one - $20,000; (b) Year two - $100,000; and (c) Year three -
$100,000.


3.
            The
      Company has the right to purchase the property for the sum of $1,000,000.
      All payments made to the owners pursuant to clause 1. above shall be
      applied to the purchase price.  The purchase option must be
      exercised prior to the commencement of production from the
      property.


4.
            The
      property is subject to a 3% net smelter returns royalty (“NSR”) on
      production.


5.
            The
      Company may purchase (a) one-third of the reserved royalty (i.e. 1% NSR)
      for $1,000,000; and (b) a second one-third of the reserved royalty (i.e.
      1% NSR) for an additional
$4,000,000.


6.
            The
      Company may terminate this Agreement at any time on 60 days
      notice.





11


NOTE
3:                     
MINERAL PROPERTIES (continued)





A.           Antelope
Ridge Project (continued)





As at
March 31, 2008, the Company has made lease payments and option payments totaling
$68,500 and has expensed $188,340 in exploration costs with respect to the
Antelope Ridge Project. In October 2007 drilling commenced on this
property.   These costs have been funded with proceeds from the
sale of common stock and warrants.





B.           Bullion
Mountain Project


Effective
November 11, 2005, the Company entered into a ten year Mining Lease with Option
to Purchase on 17 claims in Lander County, Nevada (the ‘Bullion Mountain
Project’) pursuant to the following terms:


1.
            Lease
      payments required:


a)
            On
      signing:
            $5,000
      plus $2,274 for claims fees reimbursement was
  paid


b)
              First
      anniversary:
              $5,000
      was paid


c)
            Second
      anniversary:
            $10,000
      was paid


d)
            Third
      anniversary and each anniversary
      thereafter:$15,000


2.
            The
      Company must expend the following additional amounts in exploration and
      maintenance of the property during the first two years of the
      agreement:


a)
            By
      November 2006:
            $20,000
      (incurred)


b)
            By
      November 2007:
            $50,000


In
September, 2007, this agreement was amended and the time for completing the
remaining work obligation was extended indefinitely.


3.
            The
      Company has the option to purchase this property at any time for $500,000,
      which must be exercised before production can commence. All lease, work
      requirement and property maintenance payments made up to this point would
      be deducted from the purchase
price.


4.
            Upon
      exercise of the purchase option, the Company would be required to pay a 3%
      net smelter returns royalty on production from the
    property.


5.
            The
      Company has the right to terminate this agreement at any time by giving 60
      days prior
  written     notice.





As at
March 31, 2008, the Company has made lease payments totaling $20,000 and has
incurred $24,458 in exploration costs.





C.           Dome-Hi-Ho
Project


Effective
on April 26, 2005, the Company entered into a five year Exploration and Option
to Enter Into a Joint Venture Agreement on 44 claims in Lander County, Nevada
(the ‘Dome HiHo Project’), pursuant to the following terms:


1.
            Lease
      and option payments:


a)
            On
      signing Letter of Intent April 2005:
            $10,000
      was paid in cash


b)
            On
      signing the Agreement August 2005:
            $21,000
      was paid in cash, and$16,000
      in 200,000 shares of common stock


c)
            Lease
      payment August 2005:
            $5,000
      was paid in cash


d)
            Lease
      payment March 16, 2006:
            $10,000
      was paid in cash


e)
            Lease
      payment July 2006:
            $6,667
      was paid in cash


f)
            Lease
      payment March 2007 and each year thereafter:   $10,000 in
      cash until the Company has either earned a 51% interest in the project or
      terminated the Agreement.  Lease payments to March 31, 2008 have
      been made.





The
agreement was subsequently amended on April 3, 2006. The Company must elect by
April 26, 2011 to exercise the underlying option on 20 of the claims by paying
$200,000.





12


NOTE
3:                     
MINERAL PROPERTIES (continued)





C.           Dome-Hi-Ho
Project (continued)





2.
            Required
      expenditures for exploration and property
  maintenance:


a)
            First
      lease year:
            $180,000
      (completed)


b)
            Second
      lease year:
            $180,000
      (completed)


c)
            Third
      lease year:
            $400,000


d)
            Fourth
      lease year:
            $500,000


e)
            Fifth
      lease year:
            $540,000


3.
            Upon
      completing the above work requirements, the Company will have earned a 51%
      interest in the property and the project, at which point a joint venture
      will be formed with the Company as the
operator.


4.
            The
      underlying purchase option on 20 of the claims was renegotiated in
      2006.  Accordingly, payments now required on the underlying
      purchase option are as follows:


a)
            On
      signing the option amendment in April 2006:
            $10,000
      (paid)


b)
            On
      first anniversary of amendment in April 2007:
            $10,000
      (paid)


c)
            On
      second anniversary of amendment in April 2008:
            $20,000
      (paid)


d)
            Option
      exercise price by April 2009:
            $200,000,
      less above payments.


5.
            In
      addition, the Company is obligated to pay the underlying claims
      maintenance and property holding costs as well as annual rental payments
      under a pre-existing lease agreement with a third party. The term of this
      lease is twenty years, beginning July 21, 2003. The Company will therefore
      be required to pay the following lease
amounts:


a)
            2007     $8,333
      (paid)


b)
            After
      the 2007 anniversary date, the annual rental amount will be increased
      based on the Consumer Price Index.


6.
            The
      Company would be required to pay royalties based on a graduated scale,
      ranging from 3.0% to 4.0% should production occur on the
      property.





As at
March 31, 2008, the Company has made lease and option payments totaling $117,000
and has incurred approximately $342,480 in exploration costs with respect to the
Dome-Hi-Ho Project.





D.           Trinity
Silver Project


Effective
on September 15, 2005, the Company entered into an Exploration and Development
Agreement on the Trinity Silver Project (‘TSP’) in Pershing County,
Nevada.  The TSP consists of 40 claims, 1,280 acres of fee land and
2,560 acres of sub-leased fee land. Pursuant to the terms of the
Agreement:





1.
            Lease
      and option payments required:


a)
            On
      signing:
            $10,000
      was paid.


2.
            Required
      expenditures for exploration and property
  maintenance:


a)
            In
      year 1:
            $75,000
      (completed).


b)
            In
      year 2:
            $125,000
      (completed).


c)
            Prior
      to September 15, 2008: a total of $1,000,000 in order to earn an initial
      25% interest in the TSP.


d)
            Prior
      to September 15, 2010: an additional $1,000,000, in order to earn an
      additional 26% interest (51% in total) in the
  TSP.


e)
            Prior
      to September 15, 2013: an additional $2,000,000 in order to earn an
      additional 9% interest (for a total of 60%) in the
  TSP.


3.
            Upon
      achieving its 51% or its 60% interest, the Company may then elect to form
      a joint venture, and the Company would be the operator of the joint
      venture.


4.
            The
      Company may terminate this agreement at any time upon 30 days written
      notice.





13
  NOTE
3:                     
MINERAL PROPERTIES (continued)





D.           Trinity
Silver Project (continued)


As at
March 31, 2008, the Company has made lease payments totaling $10,000 and has
incurred $581,709 in exploration and property maintenance costs with respect to
the Trinity Silver Project.





E.           Pasco
Canyon Project


On
February 14, 2006, the Company entered into a five year Option Agreement (the
‘Agreement’) on 24 claims in Nye County, Nevada (the ‘Pasco Canyon Project’),
pursuant to the following terms:





1.
            Option
      payment required: On signing: $10,000
(paid).


2.
            The
      Company is required to expend the following sums on exploration and
      maintenance of the property during the term of the
    Agreement:


Year
1                      $  50,000
(extended to July 14, 2008)


Year
2                      $100,000


Year
3                      $200,000


Year
4                      $200,000


Year
5                      $450,000


3.
            Upon
      completion of the required expenditures, the Company will have acquired a
      60% undivided interest in the property. At that point, a formal joint
      venture agreement will be entered into by the Company with the Company
      being the operator of the joint
venture.


4.
            The
      Company has the right to terminate this agreement at any time, subsequent
      to the first year’s expenditure requirement of $50,000, upon 30 days prior
      written notice.





As at
March 31, 2008, the Company has made lease payments totaling $10,000 and has
incurred $39,366 in exploration costs with respect to the Pasco Canyon Project.
As of March 31, 2008 the Company has not completed all of the prescribed
exploration expenditures because a drilling permit has not yet been granted by
the U.S. Forest Service.   However, on September 17, 2007, the
Company was granted an ‘Agreement for Extension’ until July 14, 2008 to complete
the work obligation.  Based on recent meetings with the U.S. Forest
Service, it is currently anticipated that the required permit may be received in
the next couple of months.  A drilling program has been planned and
these costs will be funded by the sale of common stock and
warrants.





F.           Dutch
Flat Gold Project


On July
2, 2006, the Company entered into a five year Exploration Agreement with Option
to Form Joint Venture (the ‘Agreement’), on 114 claims in Humboldt County,
Nevada (the Dutch Flat Project) pursuant to the following terms:


1.
            Payment
      upon signing:    $35,000
  (paid)


2.
            The
      Company shall expend the following sums on exploration and maintenance of
      the property during the first 5 years of the
  Agreement:


Year
1                      $200,000
(incurred)


Year
2                      $300,000


Year
3                      $500,000


Year
4                      $500,000


Year
5                      $500,000


3.
            Upon
      completion of the $2,000,000 in exploration expenditures over the 5-year
      period, the Company shall have earned a 51% interest in the property and
      can then elect to either 1) form a joint venture at that point whereby the
      Company would own 51%, or 2) earn an additional 19% interest in property
      by funding a positive feasibility study and then form a joint
      venture.  The Company would be the operator of the joint
      venture.


4.
            Six
      of these claims are subject to a 1.5% net smelter returns
      royalty.  Another company, in which one of the Company’s
      Directors has an interest, holds a 1% net smelter returns royalty on
      another sixteen of these claims.


5.
            The
      Company may terminate this Agreement at any time after the first year on
      30 days notice.


14





NOTE
3:                     
MINERAL PROPERTIES (continued)





F.           Dutch
Flat Gold Project (continued)





As at
March 31, 2008, the Company has made lease payments totaling $35,000 and has
incurred $492,965 in exploration costs.





G.           PPM
Gold Project


In April,
2007, the Company signed an “Exploration Agreement with Option to Form Joint
Venture” (the “Exploration Agreement”) with Miranda US, Inc., a wholly-owned
subsidiary of Miranda Gold Corp. (“Miranda”), a Canadian corporation listed on
the TSX Venture Exchange.





Under the
terms of the Exploration Agreement, Piedmont has an option to earn a 55%
interest in 44 mining claims, located in Humboldt County, Nevada by incurring
$1,750,000 in exploration work during a five year period as
follows:





(i)
            paying  $25,000
      to Miranda within 30 days of the effective date of the Exploration
      Agreement (paid);


(ii)
            incurring
      at least $175,000 in exploration work during the first year of the
      Exploration Agreement;


(iii)
            incurring
      an additional $200,000 in exploration work during the second
      year;


(iv)
            incurring
      an additional $300,000 in exploration work during the third
      year;


(v)
            incurring
      an additional $425,000 in exploration work during the fourth year;
      and


(vi)
            incurring
      an additional $650,000 in exploration work during the fifth
      year.





Upon
completing the total $1,750,000 work expenditure requirement, the Company will
have earned a 55% interest in the property and the project.  At that
point, the Company will enter into a joint venture with Miranda, with the
Company being the operator.  After the first year of the agreement,
the Company may terminate the agreement at any time on 30 days written notice.
The Company must pay all claims maintenance fees, which will be creditable
against the work commitment expenditure requirement.





As at
March 31, 2008, the Company made an initial payment of $25,000 on signing and
has expended $61,518 in exploration costs with respect to the PPM Gold
Project.





A summary
of capitalized expenditures, per property, is as follows:





Balance
      as at December 31, 2007
            
            
            Incurred
      during the period
            
            
            Balance
      as at March 31, 2008$
            
            $
            
            
            $Antelope
      Ridge
            
            
            68,500
            
            
            
            
            
            
            
            68,500Bullion
      Mountain
            
            
            20,000
            
            
            
            -
            
            
            
            20,000Dome
      Hi-Ho
            
            
            107,000
            
            
            
            10,000
            
            
            
            117,000Dutch
      Flat
            
            
            35,000
            
            
            
            -
            
            
            
            35,000Pasco
      Canyon
            
            
            10,000
            
            
            
            -
            
            
            
            10,000Trinity
      Silver
            
            
            10,000
            
            
            
            -
            
            
            
            10,000PPM
      Gold
            
            
            25,000
            
            
            
            
            
            
            
            25,000275,500
            
            
            
            10,000
            
            
            
            285,500







15


NOTE
3:                     
MINERAL PROPERTIES (continued)





H.           Willow
Creek Project


A Letter
of Intent was signed with Carlin Gold Corporation on the Willow Creek property,
Elko County, Nevada on November 12, 2007 and an initial payment of $10,000 was
made on signing.  The terms for a final agreement have not been
completed as at March 31, 2008.








NOTE
4:                      PROPERTY
AND EQUIPMENT





March
      31, 2008
            
            
            December
      31, 2007Computer
      Equipment
            
            $
            5,578
            
            
            $
            4,290Less:
      accumulated depreciation
            
            
            (4,865
            )
            
            
            (3,361
            )$
            713
            
            
            $
            929


NOTE
5:                      DUE
TO RELATED PARTIES AND RELATED PARTY TRANSACTIONS




The Board
of Directors has authorized a monthly management fee of $10,000 to the Company’s
President and CEO, which was increased to $14,000 per month, effective February
1, 2008. The unpaid portion of the monthly management fees at March 31, 2008 and
December 31, 2007 was $83,000 and $82,000, respectively.  Unpaid
administrative expenses incurred by the President and CEO at March 31, 2008 and
December 31, 2007 were $3,886 and $0, respectively. The Company reimburses the
President for office rent, which totaled $4,800 for the three months ended March
31, 2008, and $3,600 for the three months ended March 31, 2007.




The
unpaid portion of exploration costs incurred by the Company’s Vice-President at
March 31, 2008 and December 31, 2007 were $9,664 and $1,621, respectively, which
includes his compensation of $8,200 and $950, respectively, for services related
to the various exploration projects and research and development.





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.  All directors’ fees were paid at March 31, 2008 and
December 31, 2007.





From time
to time, the Company’s officers and directors advance monies to the Company.
These loans bear interest at 5% annually. These loans are unsecured and have no
fixed repayment terms. The unpaid balances related to these advances at March
31, 2008 and December 31, 2007 were $nil, respectively.





No stock
options were granted to its officers or directors by the Company for the three
months ended March 31, 2008.





All
related party transactions involving 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.)


16


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.





The
holders of the Company’s common stock are entitled to one vote for each share
held of record on all matters submitted to a vote of
shareholders.  Holders of common stock are entitled to receive ratably
such dividends, if any, as may be declared by the Board of Directors out of
funds legally available.





The
Company did not declare or pay any cash dividends during the past two
years.  The Company has no present plans for the payment of any
dividends.





Common
Share Transactions


During
the three months ended March 31, 2008, the Company completed the following
equity transactions:





A private
placement offering of 74,967 Units, consisting of one share of Common Stock (the
“Shares”) and one share of a Common Stock Purchase Warrant (the “Warrants”) at a
price of $0.30 per Unit for proceeds of $22,490.  The Warrants are
exercisable for a period of two years and shall entitle the holder to purchase
one share of Common Stock (the “Warrant Shares”) for $0.60 per Warrant
Share.





A private
placement offering of 53,571 Units, consisting of one share of Common Stock (the
“Shares”) and one share of a Common Stock Purchase Warrant (the “Warrants”) at a
price of $0.28 per Unit for proceeds of $15,000.  The Warrants are
exercisable for a period of two years and shall entitle the holder to purchase
one share of Common Stock (the “Warrant Shares”) for $0.50 per Warrant
Share.





Stock-Based
Compensation and Other Equity Transactions


The
Company does not have a stock-based compensation plan in place.  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.





For
options issued to service providers, the Company follows SFAS No. 123(R),
Accounting for Stock-Based Compensation, which requires that such transactions
be accounted for using a fair-value-based


method.
The Company uses the Black-Scholes-Merton (“BSM”) option-pricing model to
determine the fair-value of stock-based awards under SFAS
No. 123(R).





At the
time of issuance, the exercise price of all options granted was in excess of the
market price of the stock.





No
options were issued during the three months ended March 31. 2008.





Of the
450,000 stock options granted during the year ended December 31, 2007, 150,000
vested in 2007; 150,000 vest in 2008; and the remainder vest in 2009. The terms
of these awards are three to five years. The fair value of these options was
$43,900 at the 2007 grant date. Total compensation expense for the three months
ended March 31, 2008 was $52,767 and for the year ended December 31, 2007
equaled $143,500, which corresponds to the vesting schedule. As of March 31.
2008, the total compensation expense related to non-vested awards to be
recognized in future periods is $71,134. This expense will be recognized ratably
as the stock options vest on the anniversary dates of the grants during 2008 and
2009.





In
February, 2008 a director resigned from the Company’s Board and his vested
options expired unexercised.








17


NOTE
6:                      CAPITAL
STOCK (continued)





Stock-Based
Compensation and Other Equity Transactions (continued)





Below is
a summary of the stock option activity for the three months ended March 31,
2008:





WeightedAverageNumber
            
            
            Exercise
      Price$Outstanding,
      December 31, 2007
            
            
            5,975,000
            
            
            
            0.235Expired
      March 4, 2008
            
            
            (400,000
            )
            
            
            0.200Outstanding,  March
      31, 2008
            
            
            5,575,000
            
            
            
            0.237





WeightedNonvested
            
            
            AverageOptions
            
            
            Fair
      ValueNonvested
      Options
            
            
            
            
            $Nonvested
      options, December 31, 2007
            
            
            1.150.000
            
            
            
            0.11Vested
            
            
            (483,333
            )
            
            
            0.11Nonvested
      options March 31, 2008
            
            
            666,667
            
            
            
            0.11





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





Options
      Outstanding at March 31, 2008
            
            Options
      Exercisable at March 31, 2008Weighted
            
            
            
            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$
      0.25 – 0.27
            5,575,000
            2.98
            $ 0.237
            
            4,908,333
            2.848
            $ 0.207





Options
      Outstanding at December 31, 2007
            
            Options
      Exercisable at December 31, 2007Weighted
            
            
            
            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 – 0.27
            5,975,000
            3.15
            $      0.235
            
            4,825,000
            2.531
            $ 0.233





The
intrinsic value of the outstanding and exercisable stock options at March 31,
2008 was approximately  $20,500.





Common
Stock Purchase Warrants


Outstanding
warrants at March 31, 2008 were 10,825,538.  The exercise prices on
all warrants range from $0.15 to $0.60 per share. The warrants are exercisable
immediately upon issuance and the expiration dates range between one year and
five years after the date of issuance.





During
the three months ended March 31, 2008, the Company issued warrants relating to
unit private placements granting holders the right purchase 128,538 shares of
common stock.  The exercise prices on these warrants range from $0.50
to $0.60 per share. The warrants were exercisable immediately upon issuance and
the expiration dates are two years after issuance.  The Company
estimated the total fair market value of these warrants to be nominal at the
date of grant and the fair value of the warrants has been included in capital
stock.





18


NOTE
6:                      CAPITAL
STOCK (continued)





Common
Stock Purchase Warrants (continued)





During
the year ended December 31, 2007, the Company issued warrants relating to unit
private placements granting holders the right purchase 4,932,500 shares of
common stock.  The Company estimated the total fair market value of
these warrants to be $210,300 at the date of grant, using the same methods and
assumptions employed above in valuing the stock options. The exercise prices on
these warrants range from $0.16 to $0.60 per share. The warrants were
exercisable immediately upon issuance and the expiration dates range between one
year and five years after issuance.  .





The
intrinsic value of warrants exercisable at March 31, 2008 was approximately
$119,148.





A summary
of the Company’s stock purchase warrants is presented below:





Number
      ofWarrants
            
            
            Weighted
      averageexercise
      price
            
            
            Weighted
      averageremaining
      life (years)$Balance,
      December 31, 2007
            
            
            10,697,000
            
            
            
            0.31
            
            
            
            1.24Issued
            
            
            128,538
            
            
            
            0.56Balance,
      March 31, 2008
            
            
            10,825,538
            
            
            
            0.31
            
            
            
            1.00





NOTE
7:                      SUPPLEMENTAL
CASH FLOW INFORMATION AND NONCASH
INVESTING AND FINANCING ACTIVITIES





Three
      months
              ended
              March
      31, 2008
            
            
            Three
      months
              ended
              March
      31, 2007$
            
            
            $Interest
      paid
            
            
            -
            
            
            
            -Income
      taxes paid
            
            
            -
            
            
            
            -








NOTE
8:                      SUBSEQUENT
EVENTS





1.  During
April, 2008, 3,689,167 warrants expired unexercised and 737,833 warrants were
exercised at a price of $0.15 per share for proceeds of $110,675.





2. On
April 7, 2008, a 3 year option was granted to purchase 150,000 shares
of  the Company’s Common Stock at $0.28 per share.





3. In
April 2008, the Company completed a private placement offering of 312,500 Units,
consisting of one share of  Common Stock and one Common Stock Purchase
Warrant at a price of $0.16 per Unit for proceeds of $50,000.  The
Warrants are exercisable for a period of two years and entitle the holder to
purchase one share of Common Stock for $0.25 per Share.


19


NOTE
8:                      SUBSEQUENT
EVENTS  (continued)





4. In
April 2008, the Company completed a private placement offering of 86,000 Units,
consisting of one share of its Common Stock and one Common Stock Purchase
Warrant at a price of $0.175 per Unit for proceeds of $15,050.  The
Warrants are exercisable for a period of two years and entitle the holder to
purchase one share of Common Stock for $0.27 per Share.








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





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-QSB for the year ended December 31, 2007  that was filed with the
Securities and Exchange Commission on March 31, 2008.





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 joint venture our projects 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 strictly limited to research and
exploration in the state of Nevada.









20


Going
Concern





The report of our independent auditors
in our December 31, 2007 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
$16,372,420 and a working capital deficit of $218,116 at December 31, 2007. 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.




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. Our significant accounting policies are disclosed in Note 2 of
the Notes to the Financial Statements.




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




·
            consummate
      a merger or acquisition with an operating
  company.




There is no guaranty 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.







21


Expenses
for the Three Month Period ending March 31, 2008 vs. March 31, 2007




Exploration,
geological and geophysical costs decreased by $9,508, or (11.39%), to $73,961
for the three months ended March 31, 2008 as compared to $83,469 for the three
months ended March 31, 2007.  The principal reason for this decrease
was due to a decrease in exploration activity on various
properties.




Management
fees decreased by $18,098, or (16.55%), to $91,267 for the three months ended
March 31, 2008 as compared to $109,365 for the three months ended March 31,
2007.  The principal reason for this change for the three month period
was due to a reduction of $32,598 in recording the expense of vested options and
an increase of $14,500 in management and directors’ fees due to an increase in
the monthly fees paid to a director.




For the three months ended March 31,
2008, professional fees decreased $4,492, or (7.46)%, to $55,740 as compared to
$60,232 for the three months ended March 31, 2008.  This change for
the three month period is due to a decrease in accounting fees of $13,362 and an
increase in legal fees of $8,870 related to the sale of stock through private
placement and preparation of documents for the sale of units with warrants
attached.




Depreciation
expense decreased by $249, or (53.55%), to $216 for the three months ended March
31, 2008 as compared to $465 for the three months ended March 31,
2007.  The principal reason for this change is attributable to some
equipment becoming fully depreciated.




Liquidity and Financial Condition




Cash
and Working Capital




We had an accumulated deficit of
($16,372,420) from our inception in 1983 to December 31, 2007, and an
accumulated deficit of ($16,625,760) at March 31, 2008. We have no contingencies
or long-term obligations except for our work commitments under our seven (7)
option and earn-in 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 $165,877 on December 31, 2007 and a cash balance of $3,430 on
March 31, 2008.  For the three month period ending March 31, 2008, we
had net cash outflows of $162,447




The cash
flows used in operations for the three month period ended March 31, 2008 were
$189,938 compared with $108,276 for the same period in 2007.  Cash
flows used in operations for the three month period ended March 31, 2008
consisted primarily of a net loss of $253,340 offset by stock based compensation
of $52,767, with changes in working capital assets and liabilities consisting of
a decrease in prepaid expenses of $8,601 and a decrease in accounts payable and
accrued liabilities of $1,819.





The cash
flows used in investing activities for the three month period ended March 31,
2008 were $10,000 compared to $0 for the same period in 2007. Cash flows used in
investing activities consisted of a lease payment of $10,000 on the Company’s
mineral properties.





Net cash
flows provided by equity financing activities were $37,490 versus $83,750 during
the same period in 2007.  During the same period in 2007, the Company
used $9,000 of proceeds realized on equity financings to repay related party
advances.







22


Internal
and External Sources of Liquidity




Over the next 12 months period, we plan
to fund our operations through issuances of Common Stock or Common Stock with
warrants. We could enter into a joint venture arrangement on one or more of our
leased properties. In the event our exploration is successful and mining
eventually commences on one or more of our leased properties, we could then
commence receiving revenues from the sale of gold and/or silver produced on
these properties.




Contractual
Obligations




We have no commitments for capital
expenditures.




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




We were and are committed to making
certain exploration work expenditures, lease and option payments, and claims
maintenance payments on properties signed at December 31, 2007 over the
forthcoming 12 months period.




Bullion
Mountain Project:


·
            Required
      work expenditure by 3/31/08; $20,000 of which $44,458 has already been
      expended; In September, 2007, this agreement was amended and the time for
      completing the remaining work obligation was extended
      indefinitely.


·
            Current
      claims maintenance: $5,843 has been paid by December,
  2007


·
            Annual
      payment:  $10,000 was paid in November,
  2007.




Antelope
Ridge:


·
            Required
      work expenditure by 3/31/08: $120,000, of which $256,840 has already been
      expended.


·
            Current
      claims maintenance: $30,173 has been paid by March 31
  2008


·
            Annual
      payments: $15,000 in cash and $15,000 in Common Stock; were made in April,
      2007.


·
            No
      annual payments were required by March 31,
2008.




Dome
HiHo Project:


·
            Required
      work expenditure by 3/31/2008: $360,000, of which $459,479 has already
      been expended.


·
            Current
      claims maintenance:  $16,705 has been paid by March 31,
      2008.


·
            Annual
      payments:  $10,000 which was paid in March,
  2008.




Trinity Silver
Project:


·
            Required
      work expenditure: $200,000, of which $616,709 has already been
      expended.


·
            Current
      claims maintenance:  $19,329 has been paid by March 31,
      2008


·
            Annual
      payments:  $0.




Pasco
Canyon Gold Project:


·
            Required
      work expenditure:  $49,366 has already been completed. Further
      work postponed pending receipt of drill permit from U.S. Forest
      Service.


·
            Current
      claims maintenance: $6,416 has been paid by March 31,
  2008.


·
            Annual
      payments; $0.








23


Dutch
Flat Gold Project:


·
            Required
      work expenditure:  $200,000 by March 31, 2008, of which $527,965
      was expended at March 31, 2008.


·
            Current
      claims maintenance; $14,250 has been paid by March 31,
    2008.


·
            Annual
      payments; $0.




PPM
Miranda Gold Project:


·
            Required
      work expenditure for first year; $175,000, of which $86,518 has already
      been expended.  Awaiting receipt of drill
  permit.


·
            Current
      claims maintenance:  $17,801 has been paid by March 31,
      2008.


·
            Annual
      payments; $0.




Willow Creek
Project:


·
            Letter
      of Intent signed:  Initial signing fee of $10,000 was made by
      December, 2007.




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. 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. We are addressing
these issues by reviewing and revising our internal accounting policies and
procedures.





(B)           Changes
in Internal Controls





There
were no changes in our internal controls or in other factors that could have
significantly affected those controls subsequent to the date of our most recent
evaluation.









24




PART
II – OTHER INFORMATION







Item
1. Legal Proceedings


None.





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





2008:


In
February, 2008, 74,967 common shares were sold at $0.30 per share with net
proceeds of $22,490.





In March,
2008, 53,571 common shares were sold at $0.28 per share with net proceeds of
$15,000.





2007:


In
February, 2007, 550,000 common shares were issued on exercise of warrants at
$0.15 and $0.16 to net proceeds of $83,750.





In May,
2007, 1,250,000 common shares were sold at $0.16 per share with net proceeds of
$178,018.





In June,
2007, 625,000 common shares were sold at $0.16 per share with proceeds of
$100,000.





In July,
2007, 1,875,000 common shares were sold at $0.16 per share with proceeds of
$300,000.





In
August, 2007, 1,818,182 common shares were issued on exercise of warrants at
$0.08 to net proceeds of $145,455.





In
October, 2007, 656,298 common shares were issued on exercise of warrants at
$0.08 per share to net proceeds of $52,504.





In
November, 2007, 1,820.000 common shares were sold at $0.30 per share with
proceeds of $546,000.





In
December, 2007, 300,000 common shares were sold at $0.30 per share with proceeds
of $90,000.





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.  The original sale of the Warrants in the private placement was
made to accredited investors as defined in Rule 501(a) under the Securities Act,
no general solicitation was made by us or any person acting on our behalf; the
securities sold were subject to transfer restrictions, and the certificates for
those shares contain an appropriate legend stating that they have not been
registered under the Securities Act and may not be offered or sold absent
registration or pursuant to an exemption there from.





Item
3. Defaults Upon Senior Securities


None.





25


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


None.





Item
5. Other Information


None.





Item
6. Exhibits





Exhibit No.
            
            Description
            
            Location31.1
            
            Certification
      Pursuant to Section 302
            
            Provided
      herewith31.2
            
            Certification
      Pursuant to Section 302
            
            Provided
      herewith32.1
            
            Certification
      Pursuant to 18 U.S.C. Section 1350
            
            Provided
      herewith32.2
            
            Certification
      Pursuant to 18 U.S.C. Section 1350
            
            Provided
      herewith





26





SIGNATURES





Pursuant to the requirements of Section
13 or 15(d) of the Securities and Exchange Act of 1934 the registrant has duly
caused this Quarterly Report of Piedmont Mining Company, Inc. on Form 10-QSB for
the period ended March 31, 2008 to be signed on its behalf by the undersigned,
thereunto duly authorized.


PIEDMONT
      MINING COMPANY, INC.,
              a
      North Carolina CorporationDated
      May 14, 2008
            /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)
















27