10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q/A

(Amendment no. 1)

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

For the quarterly period ended:        June 30th, 2013

¨         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. 033-17774-NY

ALL GRADE MINING, INC.

  (Exact name of registrant as specified in its charter)

Colorado	*
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

370 W. Pleasantview Ave., Suite 163, Hackensack, NJ 0760

 (Address of principal executive office)

Registrant's telephone number, including area code: (201) 788-3785

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.þ YES    ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, 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). o Yes    þ NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definitions of “large accelerated filer,”  “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer   o	Accelerated filer o
Non-accelerated filer    o	Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ YES     þ    NO

Indicate the number of the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.

As of Date	Outstanding
30 June 2013	153,824,857
29 July 2013	239,990,626

EXPLANATORY NOTE

The purpose of this Amendment No. 1 to All Grade Mining, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013, filed with the Securities and Exchange Commission on August 14, 2013 (the “Form 10-Q”), is solely to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulation S-T. Exhibit 101 to this report provides the consolidated financial statements and related notes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).

No other changes have been made to the Form 10-Q. This Amendment No. 1 to the Form 10-Q speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.

Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

ALL GRADE MINING, INC. AND SUBSIDIARY

(A Development Stage Company Commencing January 3, 2006)

 CONTENTS

		Page
PART I-	FINANCIAL INFORMATION	3
ITEM 1-	FINANCIAL STATEMENTS	4
	Condensed Consolidated Balance sheets as of June 30, 2013  and December 31, 2012 (unaudited)	4
	Condensed Consolidated Statement  of Operations for the six and three months ended June 30, 2013, and June 30, 2012 and for the period January 3, 2006 (date of commencement as a development stage company) through June 30, 2013 (unaudited)	5
	Condensed Consolidated Statement  of Cash Flows for the six months ended June 30, 2013, and December 31, 2012 and for the period January 3, 2006 (date of commencement as a development stage company) through June 30, 2013 (unaudited)	6
	Notes to condensed consolidated financial statements (unaudited)	7
ITEM 2-	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
ITEM 3-	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	23
ITEM 4-	CONTROLS AND PROCEDURES	23
PART II-	OTHER INFORMATION	25
ITEM 1-	LEGAL PROCEEDINGS	25
ITEM 1A-	RISK FACTORS	25
ITEM 2-	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	25
ITEM 3-	DEFAULT UPON SENIOR SECURITIES	26
ITEM 4-	MINE SAFETY DISCLOSURES	26
ITEM 5-	OTHER INFORMATION	26
ITEM 6-	EXHIBITS	26
SIGNATURES		27

2

PART I – FINANCIAL INFORMATION

This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”).  These statements are based on management’s beliefs and assumptions, and on information currently available to management.  Forward-looking statements include the information concerning our possible or assumed future results of operations set forth under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”  Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider,” or similar expressions are used.

Forward-looking statements are not guarantees of future performance.  They involve risks, uncertainties, and assumptions.  Our future results and shareholder values may differ materially from those expressed in these forward-looking statements.  Readers are cautioned not to put undue reliance on any forward-looking statements.

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ALL GRADE MINING, INC.
(A Development Stage Company Commencing January 3, 2006)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
	June 30,			December 31,
	2013			2012
ASSETS
Current Asset
Cash	$	486		$	359
PROPERTY AND EQUIPMENT - Net		306			306
OTHER ASSETS
Depository payment towards acquisition of iron ore mine		350,000			350,000
Prepaid Expenses		-			470,000
		350,000			820,000
Total Assets	$	350,792		$	820,665
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current Liabilites
Accounts Payable	$	936,310		$	762,111
Taxes payable		8,716			8,716
Accrued interest payable		124,927			82,685
Due to  stockholders		6,000			6,000
Loans payable		291,000			311,000
Convertible debentures, net of debt discount of $57,000 and $0 as of  June 30, 2013 and December 31, 2012		81,000			38,000
Derivative liability		1,922,822			209,100
Total Current Liabilites		3,370,775			1,417,612
Convertible debentures, net of debt discount of $451,700 and $467,200 as of  June 30, 2013 and December 31, 2012, net of current portion		423,300			362,800
Total liabilities		3,794,075			1,780,412
Stockholders' Deficit (Note 8)
Convertible Preferred Stock Class A, no par value, 100,000 shares authorized at June 30, 2013 and  December 31, 2012. Issued and outstanding 20,000 shares at June 30, 2013 and  December 31, 2012.		46,000			46,000
Convertible Preferred Stock Class B, no par value, 400,000 shares authorized at June 30, 2013 and  December 31, 2012. None issued and outstanding at  June 30, 2013 and  December 31, 2012.
Preferred Stock Class C, no par value, 50,000 shares authorized at June 30, 2013 and  December 31, 2012. Issued and outstanding 20,000 shares at June 30, 2013 and  December 31, 2012.		9,000			9,000
Common stock, par value $.001 per share; authorized 500,000,000 shares, issued and outstanding 161,824,857 and 128,824,857 shares at June 30, 2013 and  December 31, 2012		161,825			128,825
Additional Paid in Capital		11,431,554			11,242,054
Deficit Accumulated During the Development Stage		(15,091,662	)		(12,385,626	)
Total Stockholders' Deficit		(3,443,283	)		(959,747	)
Total Liabilities and Stockholders' Deficit	$	350,792		$	820,665

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

4

ALL GRADE MINING, INC.
(A Development Stage Company Commencing January 3, 2006)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
	Six Months Ended						Three Months Ended						January 3, 2006 (date of commencement as a development stage company) though June 30, 2013
	June 30,			June 30,			June 30,			June 30,
	2013			2012			2013			2012
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Net Sales	$	-		$	-		$	-		$	-		$	7,500
Cost of Sales		-			-			-			-			3,135
Gross Profit (Loss)		-			-			-			-			4,365
Operating Expenses
Officers’ compensation		8,669			25,000			3,752			-			162,669
Mine related expenses		32,600			382,500			32,600			377,500			360,100
Consulting fees		652,500			877,942			225,000			817,942			2,971,921
General and administrative		294,285			58,609			233,259			43,313			877,687
Total Operating Expenses		988,054			1,344,051			494,611			1,238,755			4,372,377
Operating loss		(988,054	)		(1,344,051	)		(494,611	)		(1,238,755	)		(4,368,012	)
Interest income		11			-			2			-			14
Other income					-						-			17,509
Change in fair value of derivative liability		(1,379,184	)		1,473,200			(1,464,759	)		446,100			(344,551	)
Interest expense		(338,809	)		(209,009	)		(194,760	)		(184,636	)		(1,256,209	)
Loss on debt conversion		-			(4,730,000	)		-			(4,730,000	)		(5,089,313	)
Loss on negotiated debt settlement		-			-			-			-			(26,100	)
Loss on deposit to acquire property		-			-			-			-			(4,025,000	)
Total other income and (expenses)		(1,717,982	)		(3,465,809	)		(1,659,517	)		(4,468,536	)		(10,723,650	)
Net loss	$	(2,706,036	)	$	(4,809,860	)	$	(2,154,128	)		(5,707,291	)	$	(15,091,662	)
Loss Per Common Share:
Basic and Diluted	$	(0.02	)	$	(0.06	)		(0.02	)		(0.06	)
Weighted average number of common shares outstanding:
Basic and Diluted		130,874,581			87,274,528			132,901,780			89,490,297

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

5

ALL GRADE MINING, INC.
(A Development Stage Company Commencing January 3, 2006)
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
							January 3, 2006  (date of  commencement as a development stage company) though June 30, 2013
	Six Months Ended
	June 30,			June 30,
	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$	(2,706,036	)	$	(4,809,860	)	$	(15,091,662	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Depreciation expense		-			44			9,260
Impairment of equipment		-			-			3,907
Issuance of stock for services		-			282,500			1,948,500
Amortization of debt discount		103,500			43,400			228,400
Change in fair value of derivative liability		1,379,184			(1,473,200	)		344,551
Non-cash Interest Expense		189,538			-			884,071
Issuance of stock for mine costs		-			377,500			-
Loss on debt conversion		189,500			4,730,000			5,278,813
Loss on deposit to acquire property		-			-			4,025,000
Changes in Assets and Liabilities
(Increase) Decrease in prepaid expenses		470,000			(27,800	)		-
Increase in Accounts Payable		207,199			398,084			1,028,285
Increase in Accrued interest payable		42,242			25,425			147,827
Increase in Payroll taxes payable		-			-			8,716
NET CASH USED IN OPERATING ACTIVITES		(124,873	)		(453,907	)		(1,184,332	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		-			-			(13,473	)
Depository payment towards acquisition of iron ore mine		-			(100,000	)		(350,000	)
NET CASH USED IN INVESTING ACTIVITIES		-			(100,000	)		(363,473	)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash Proceeds (repayment) from advances		-			(802	)		6,000
Cash Proceeds (repayment) from loans		(20,000	)		21,000			303,900
Cash Proceeds, net of repayments, from issuance of convertible debentures		145,000			532,683			1,148,000
Issuance of common stock for cash		-			-			90,391
NET CASH PROVIDED BY FINANCING ACTIVITIES		125,000			552,881			1,548,291
(DECREASE) INCREASE IN CASH		127			(1,026	)		486
CASH - BEGINNING OF PERIOD		359			1,040			-
CASH - END OF PERIOD	$	486		$	14		$	486
Supplemental Disclosure:
Cash Paid for Interest	$	-		$	-		$	-
Cash Paid for Income Taxes	$	-		$	-		$	-
Non-cash investing and financing activities:
Debt discount related to convertible debentures	$	145,000		$	382,100		$	831,600
Issuance of common stock for the settlement of debt	$	33,000		$	226,383		$	288,757

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

6

ALL GRADE MINING, INC. AND SUBSIDIARY

(A Development Stage Company Commencing January 3, 2006)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1)           NATURE OF BUSINESS AND BASIS OF PRESENTATION

All Grade Mining, Inc. and Subsidiary (a development stage company) (“the Company”) is a corporation organized under the laws of the State of Colorado.  The Company is currently engaged in the acquisition and exploration of mining properties and maintains its corporate offices in Hackensack, New Jersey.

The Company has generated nominal revenues to date; accordingly, the Company is considered a development stage enterprise as defined in the Accounting Standards Codification 915 “Development Stage Entities.”  The Company is subject to a number of risks similar to those of other companies in an early stage of development.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, these interim financial statements do not include all of the information and footnotes required for annual financial statements.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2012 included in the Company’s Annual Report on Form 10-K as filed with the SEC on July 8, 2013.

The results for the six month periods ended June 30, 2013, are not necessarily indicative of the results to be expected for any subsequent quarter or the entire fiscal year.  The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date.

2)           GOING CONCERN

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred operating losses and negative operating cash flow since inception and future losses are anticipated. In addition the company is not in compliance with its acquisition agreement regarding its purchase of the mine. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.  The Company’s plan of operations, even if successful, may not result in cash flow sufficient to finance and expand its business.

7

Realization of assets is dependent upon continued operations of the Company, which in turn is dependent upon management’s plans to meet its financing requirements and the success of its future operations.  The ability of the Company to continue as a going concern is dependent on improving the Company’s profitability and cash flow and securing additional financing.

Management is presently seeking to raise permanent equity capital in the capital markets to eliminate negative working capital and raise the necessary funds to satisfy its commitment for the mining rights.  Failure to raise equity capital or secure some other form of long-term debt arrangement will cause the Company to further increase its negative working capital deficit and loss of the ability to acquire the iron ore mine.

The Company believes in the viability of its strategy to generate revenues and profitability and in its ability to raise additional funds, and believes that the actions presently being taken by the Company provide the opportunity for it to continue as a going concern.  However, the Company can give no assurance that such financing will be available on terms advantageous to it, or at all.  Should the Company not be successful in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all of its operational activities.  The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

3)           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.  The most significant estimates, among other things, are used in accounting for allowances are for deferred income taxes, expected realizable values for long-lived assets (primarily property and equipment), derivative liability and contingencies, as well as the recording and presentation of its common stock issuances.  Estimates and assumptions are periodically reviewed and the effects of any material revisions are reflected in the condensed consolidated financial statements in the period that they are determined to be necessary.  Actual results could differ from those estimates and assumptions.

8

Principle of Consolidation

The condensed consolidated financial statements of All Grade Mining, Inc. and Subsidiary include accounts of the Company and its wholly-owned foreign subsidiary, All Grade Mining Chile, SA.  Intercompany transactions and balances are eliminated in consolidation. All Grade Mining Chile, S.A. was formed in November 2011, has yet to commence operations, and has minimal assets.

Derivative Financial Instruments

In connection with the issuance of certain convertible debentures, the terms of the convertible debentures included an embedded conversion feature which provided for a conversion of the convertible debentures into shares of common stock at a rate which was determined to be variable.  The Company determined that the conversion feature was an embedded derivative instrument pursuant to ASC 815 “Derivatives and Hedging”.

The accounting treatment of derivative financial instruments requires that the Company record the conversion options at their fair values as of the inception date of the convertible debenture agreements and at fair value as of each subsequent balance sheet date.  As a result of entering into the convertible promissory note, the Company was required to classify all other conversion options as derivative liabilities and record them at their fair values at each balance sheet date.  Any change in fair value was recorded as a change in fair value of derivative liability for each reporting period at each balance sheet date.  The Company reassesses the classification at each balance sheet date.  If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method and conversion options at variable rates are deemed to be a “down-round protection” and therefore, do not meet the scope exception for treatment as a derivative under ASC 815.  Since, “down-round protection” is not an input into the calculation of the fair value of the conversion option and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. 

Reclassification

Certain accounts in the prior year’s financial statements have been reclassified for comparative purposes to conform to the presentation in the current year’s financial statements.  These reclassifications have no effect on previously reported earnings.

Recent Accounting Pronouncements

The FASB, the Emerging Issues Task Force and the SEC have issued certain accounting standards updates and regulations as of September 30, 2012 that will become effective in subsequent periods; however, management of the Company does not believe that any of those updates would have significantly affected the Company’s financial accounting measures or disclosures had they been in effect during the periods reported upon, and it does not believe that any of those pronouncements will have a significant impact on the Company’s consolidated financial statements at the time they become effective.

9

4)           FAIR VALUE

ASC 820 “Fair Value Measurements and Disclosures” defines fair value, establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements.  As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  This guidance clarifies that the exchange price is the price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date and emphasizes that fair value is a market-based measurement and not an entity-specific measurement.

ASC 820 establishes the following hierarchy used in fair value measurements and expands the required disclosures of assets and liabilities measured at fair value:

Level 1	Inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.
Level 2	Inputs use other inputs that are observable, either directly or indirectly. These inputs include quoted prices for similar assets and liabilities in active markets as well as other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.
Level 3	Inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset or liability.

In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair measurements requires judgment and considers factors specific to each asset or liability.

Liabilities measured at fair value on a recurring basis at June 30, 2013 and December 31, 2012 are as follows:

10

	Quoted Prices in Active Markets for Identical Liabilities		Significant Other Observable Inputs		Significant Observable Inputs		Balance at
	(Level 1)		(Level 2)		(Level 3)		June 30, 2013
Embedded conversion feature – June 30, 2013	$	-	$	-	$	1,922,822	$	1,922,822

 

	Quoted Prices in Active Markets for Identical Liabilities		Significant Other Observable Inputs		Significant Observable Inputs		Balance at
	(Level 1)		(Level 2)		(Level 3)		June 30, 2013
Embedded conversion feature – December 31, 2012	$	-	$	-	$	209,100	$	209,100

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.  The Company’s Level 3 liabilities consist of derivative liabilities associated with the convertible debt that contains an indeterminable conversion share price and the tainted conversion to other outstanding convertible debt as the Company cannot determine if it will have sufficient authorized common stock to settle such arrangements.

11

The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the six month period ended June 30, 2013.

	Embedded  Conversion Feature
Balance - December 31, 2012	$	209,100
Included in other income/expense		-
Change in fair value of derivative liability		1,379,184
Conversion		-
Included in liabilities		334,538
Included in stockholders' equity		-
Transfers in and/or out of Level 3		-
Balance - June 30, 2013	$	1,922,822

5)           DEPOSITORY PAYMENT TOWARDS ACQUISITION OF IRON ORE MINE

On September 21, 2011, the Company entered into an agreement to acquire title to an iron ore mine in the Republic of Chile at an acquisition cost of $3,250,000 as of  June 30, 2013 and paid an initial deposit of $250,000 to the seller.  The agreement provides for the participation of the Republic of Chile in 15% of the mining profits.

12

On April 26, 2012, the Company amended the payment terms of the agreement and paid an additional deposit of $100,000 upon execution of the amended agreement.  Under the terms of the amended agreement, the Company is required to remit the remaining balance of $2,900,000 over a three year period as follows:

	Amount
May 31, 2012	$	400,000
August 31, 2012		500,000
February 28, 2013		500,000
August 31, 2013		500,000
February 28, 2014		500,000
August 31, 2014		500,000
Total	$	2,900,000

As of June 30, 2013, the Company is not in compliance with the terms of this agreement due to non-payment of the amounts due on May 31, 2012, August 31, 2012 and February 28, 2013.  However, the seller has not issued the Company a formal notice of default.

6)           RELATED PARTY TRANSACTIONS

During 2007, Martin Honig, a former Director and current stockholder of the Company loaned the Company $8,000 on a non-interest bearing basis in order to provide the Company with working capital.  In July 2008 this same individual loaned the Company an additional $5,000 to be used for working capital.  The Company repaid $7,000 to Mr. Honig. In March 2012, Mr. Honig loaned the Company an additional $6,000.  In May 2012, Mr. Honig elected to convert his $6,000, 10.0% Loan into common stock of the Company.  In the conversion transaction, Mr Honig received 6,000,000 shares of common stock in exchange for the loan and no accrued interest, resulting in a balance of $ 6,000 due him as of June 30, 2013.

Marshal Shichtman, the Company’s securities counsel and a stockholder of 13,000,000 common shares has billed the Company $60,000 for legal services performed thru June 30, 2013. Marshal Shichtman received 8,000,000 shares of common stock for payment valued at $8,000 applied against account payable.  $229,000 is currently outstanding and reported in accounts payable in the accompanying financial statements.  The Company incurred legal fees for services provided by Marshal Shichtman in the amounts of $60,000 and $60,000 for the six month periods ended June 30, 2013 and 2012, respectively.

7)           CONVERTIBLE DEBENTURES

On January 24, 2013, the Company borrowed $100,000 from an unrelated party pursuant to convertible debenture agreements.  The debentures bear interest at 8.0% per annum and have a term of one year, maturing on January 24, 2014. The loan agreement provides for the right of the holder to convert the loan principal and interest into shares of common stock at a stated conversion price of the average of the three lowest daily trades in the previous 20 days with a 50% discount.

 

13

On April 22, 2012 the Company borrowed $15,000 from a unrelated party pursuant to convertible debenture agreement. The debentures bear interest at 6% per annum and have a term of one and a quarter years, maturing on August 31, 2014. The debentures are convertible into common stock at $0.25 per share.

On May 24, 2013, the Company borrowed $30,000 from an unrelated party pursuant to convertible debenture agreements.  The debentures bear interest at 10% per annum and have a term of one year, maturing on May 24, 2014. The loan agreement provides for the right of the holder to convert the loan principal and interest into shares of common stock at a stated conversion price of the average of the three lowest daily trades in the previous 20 days with a 50% discount.

As of June 30, 2013 and December 31, 2012 convertible debentures consist of the following:

	June 30, 2013		December 31, 2012
Convertible Debentures	$	1,013,000	$	868,000
Less current portion		81,000		38,000
Less debt discount		508,700		467,200
Long term Convertible Debentures, net of current portion and debt discount	$	423,300	$	362,800

 The Company accounted for the issuance of the convertible debenture in accordance with ASC 815” Derivatives and Hedging.”  The debenture is convertible into an indeterminate number of shares for which the Company cannot determine if it has sufficient authorized shares to settle the transaction with.  Accordingly, the embedded conversion option is a derivative liability and is marked to market through earnings at the end of each reporting period.

8)           LOANS PAYABLE:

Loans payable consist of the following at June 30, 2013 and December 31, 2012:

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	June 30, 2013		December 31, 2012
Loan payable to Louis Savaglio	$	1,000	$	1,000
Loan payable to unrelated parties		150,000		150,000
Loan payable to unrelated parties		140,000		160,000
Total	$	291,000	$	311,000

(a)   In 2006, the Company borrowed the sum of $16,000 from Louis Savaglio, an independent third party.  The loan is payable on demand and bears interest at the rate of 6.75% per annum. On November 30, 2009, the Company had repaid $5,000 with the issuance of 99,100 shares of common stock.  On July 14, 2011 Mr. Savaglio assigned $10,000 of his debt together with accrued interest of $3,156 to four entities unrelated to the Company.  Each new entity has a note for $3,289 carrying interest at 6%. Subsequently those four entities converted their loans into 13,462,000 shares of the Company’s common stock.  The balance due to Mr. Savaglio as of June 30, 2013 and December 31, 2012 was $1,000.

(b)   On September 15, 2011, the Company borrowed $150,000 from an unrelated third party. The loan was due on October 15, 2011 together with interest at a rate of 25% per annum.  As of June 30, 2013, the accumulated interest on this loan was $47,015.  The Company is not in compliance with the repayment terms of the loan as it was not repaid on its maturity date and is currently in technical default.

(c)   On November 15, 2011, the Company borrowed $50,000 from an unrelated third party.  The loan was due and payable upon the Company filing its Regulation D Offering with the SEC which occurred on August 1, 2011.  The note accrues interest at a rate of 4.0% per annum. As of June 30, 2013, the accumulated interest on this loan was $4,405; the Company is not in compliance with the repayment terms of the loan and is currently in technical default.

(d)   On June 30, 2012, July 24, 2012, September 25, 2012 and November 8, 2012. The Company borrowed $25,000, $50,000 and $15,000 from an unrelated third party.  These notes accrue interest at a rate of 0% per annum.

9)           COMMON STOCK

There were 500,000,000 shares of common stock authorized, with 161,824,857 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively. The par value for the common stock is $.001 per share.

There were common stock transactions for the six months ended June 30, 2013.

In June 2013, The Company issued 33,000,000 shares of common stock on settlement of accounts payable of $33,000. The fair market value of the shares at the date of issuance aggregated $222,500, the excess of the fair value over the amount of the payable amounted to $189,500 and has been charged to operations during the six and three months ended June 30, 2013 and is included in General and administrative expenses on the accompanying consolidated statement of operations.

 

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10)        COMMITMENTS AND CONTINGENCIES

a)           Depository payment towards acquisition of iron ore mine

See disclosures in Note 5 regarding obligations in connection with the acquisition of an iron ore mine.

b)           Litigation

Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur.  The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.  In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements.  If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.  There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.  As of June 30, 2013, the Company has not accrued any amounts for loss contingencies.

 

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11)        SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, The Company has analyzed its operations subsequent to the date these financial statements were issued, and has determined that it does not have material subsequent events to disclose in these financial statements.

ITEM 2                      MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

This report contains forward looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) and Section 27A of the Securities Act of 1933 (the “Securities Act”). Statements contained in this report which are not statements of historical facts may be considered forward-looking information with respect to plans, projections, or future performance of the Company as defined under the Private Securities litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those projected. The words “anticipate”, “believe”, “estimate”, “expect”, “objective”, and “think” or similar expressions used herein are intended to identify forward-looking statements.  The forward-looking statements are based on the Company’s current views and assumptions and involve risks and uncertainties that include, among other things,  national and international economic and market conditions; our ability to raise capital and complete the acquisition of certain assets; our ability to operate mining assets; our ability to sustain, manage, or forecast growth; existing government regulations and the changes in, or the failure to comply with, government regulations; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.

Except as may be required by applicable law, we do not undertake or intend to update or revise our forward-looking statements, and we assume no obligation to update any forward-looking statements contained in this report as a result of new information or future events or developments. Thus, you should not assume that our silence over time means that actual events are bearing out as expressed or implied in such forward-looking statements. You should carefully review and consider the various disclosures we make in this report and our other reports filed with the SEC that attempt to advise interested parties of the risks, uncertainties and other factors that may affect our business. The following discussion and analysis should be read in conjunction with the financial statements and related footnotes included elsewhere in this quarterly report which provide additional information concerning the Company’s financial activities and condition.

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Description of Business

Prior to October 2011, the Company operated as Hybred International, Inc. and developed and produced a therapeutic horseshoe designed to reduce injuries associated with the concussive effect of horses' hooves on hard surfaces such as concrete, asphalt, and rock-hard racetracks.

Effective October 2011, the Company's Board of Directors and shareholders affirmatively voted to modify the Company's core line of business to focus upon mining operations, acquire an iron ore mine in Chile, and change the name of the Company to All Grade Mining, Inc.

The Company has generated nominal revenues to date; accordingly, the Company is considered a development stage enterprise as defined in the Accounting Standards Codification 915 “Development Stage Entities.”  The Company is subject to a number of risks similar to those of other companies in an early stage of development.

The Company currently has one employee.

Liquidity and Capital Resources

We had $486 cash as of June 30, 2013 compared to $359 at December 31, 2012.  This net increase of $127 consisted of:

Proceeds from financing activities	$	125,000
Cash used in investing activities		-
Cash used in operating activities		(124,873	)
Net decrease	$	127

We have incurred significant losses and negative cash flows from operations since our inception in April 2010.  We have an accumulated deficit of $15,091,662 and a working capital deficiency of $3,370,469 as of June 30, 2013.  These conditions raise substantial doubt about our ability to continue as a going concern.  We have historically financed our activities through the private placement of equity securities.  Through June 30, 2013, we have dedicated our financial resources to the planned mining activities and general and administrative expenses as described later in the section titled Results of Operations.

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In September 2011, we entered into an agreement (as amended) to acquire title to an iron ore mine in the Republic of Chili for $3,250,000 and, as of June 30, 2013, have paid $350,000.  Under the terms of the amended agreement, we are required to remit the remaining balance of $2,900,000 in periodic payments now through August 2014 as follows:

May 31, 2012	$	400,000
August 31, 2012		500,000
February 28, 2013		500,000
August 31, 2013		500,000
February 28, 2014		500,000
August 31, 2014		500,000
Total	$	2,900,000

As of June 30, 2013, we are not in compliance with the terms of this agreement due to non-payment of the amounts due on May 31, 2012, August 31, 2012 and February 28, 2013.  However, the seller has not issued us a formal notice of default.

We plan to fund the acquisition of the mine as described above and our planned mining activities beyond June 30, 2013 primarily through the sale of debt and/or equity securities.  We cannot be certain that such funding will be available on acceptable terms or available at all.  To the extent that we raise additional funds by issuing equity securities, our stockholders may experience significant dilution.  If we are unable to raise funds when required or on acceptable terms, we may have to: a) Significantly delay, scale back, or discontinue the planned mining activities; b) Seek collaborators at an earlier stage than would otherwise be desirable and/or on terms that are less favorable than might otherwise be available; or c) Relinquish or otherwise dispose of rights and/or assets that we would otherwise seek to develop or commercialize ourselves.

We can give no assurance that such financing will be available on reasonable terms or available at all or that it can generate revenue. Should we not be successful in obtaining the necessary financing or generate revenue to fund our operations, we would need to curtail or cease operational activities. The accompanying condensed consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern.

Results of Operations - For the three months ended June 30, 2013 compared to the three months ended June 3, 2013;

Revenues

We have not generated revenues for the three months ended June 30, 2013 and 2012.

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Mine Related Expenses

Mine related expenses were $32,600 and $377,500 for the three months ended June 30, 2013 and 2012, respectively.  This decrease of $344,900 was primarily due to The Company getting current on their financial reporting.

Consulting Fees

Consulting fees were $225,000 and $817,942 for the three months ended June 30, 2013 and 2012, respectively.  This decrease of $592,942 was primarily due to cash and stock issued to 3 consulting firms related to business advisory, strategic and communications services in 2012 which are being amortized over the life of the agreement.

General and Administrative Expenses

General and administrative expenses were $233,259 and $43,313 for the three months ended June 30, 2013 and 2012, respectively.  This increase of $189,946 was primarily due to the conversion expense of accounts payable.

Change in Fair Value of Derivative Liability

The change in the fair value of the derivative liability was a deficit of ($1,464,759) and $446,100 for the three months ended June 30, 2013 and 2012, respectively.  This change of $1,910,859 was primarily due to the drop in market prices of the stock and the lowering of the value due to possible conversion holders as a result of how derivative liabilities are valued.

Interest Expense

Interest expense was $194,760 and $184,636 for the three months ended June 30, 2013 and 2012, respectively.  This change of $10,124 was primarily due to interest expense recorded upon issuance of convertible debt in which the debt discount related to the conversion feature recorded as a derivative exceed the face value of the note of which such increase is charged to interest expense and interest on increased borrowings incurred after the second quarter of 2012.

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Net Income (Loss)

Net loss was $2,154,128 and $5,707,291 for the three months ended June 30, 2013 and 2012, respectively.  This decrease in net income of $3,553,163 was attributable to the changes in the expense captions as described above and changes in fair value of derivative liability.

Results of Operations - For the six months ended June 30, 2013 compared to the three months ended June 30, 2012

Revenues

We have not generated revenues for the six months ended June 30, 2013 and 2012.

Mine Related Expenses

Mine related expenses were $32,600 and $382,500 for the six months ended June 30, and 2012, respectively. This decrease of $349,900 was primarily due to The Company getting current on their financial reporting.

Consulting Fees

Consulting fees were $652,500 and $877,942 for the six months ended June 30, 2013 and 2012, respectively. This decrease of $225,442 was primarily due to cash and stock issued to 3 consulting firms related to business advisory, strategic and communications services in 2012 which are being amortized over the life of the agreement.

General and Administrative Expenses

General and administrative expenses were $294,285 and $58,609 for the six months ended June 30, 2013 and 2012, respectively. This increase of $235,676 was primarily due to the excess of fair value of the actual accounts payable and professional services.

Change in Fair Value of Derivative Liability

The change in the fair value of the derivative liability was a deficit of ($1,379,184) and of $1,473,200 for the six months ended June 30, 2013 and 2012, respectively. This decrease of ($2,852,384) was primarily due to the drop in market prices of the stock and the lowering of the value due to possible conversion holders as a result of how derivative liabilities are valued.

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Interest Expense

Interest expense was an expense of $338,809 and $209,009 for the six months ended June 30, 2013 and 2012, respectively. This change of $129,800 was primarily due to interest expense recorded upon issuance of convertible debt in which the debt discount related to the conversion feature recorded as a derivative exceed the face value of the note of which such increase is charged to interest expense and interest on increased borrowings incurred after the second quarter of 2011.

In June 12, 2013, the company issued 33,000,000 shares of common stock valued at $222,500 for settlement of accounts payable of $33,000 and a loss on conversion of accounts payable of $189,500.

Net Loss

Net loss was $2,706,036 and $4,809,860 for the six months ended June 30, 2013 and 2012, respectively. This decrease of $2,103,824 was attributable to the changes in the expense captions as described above.

Going Concern

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred operating losses and negative operating cash flow since inception and future losses are anticipated. In addition the company is not in compliance with its acquisition agreement regarding its purchase of the mine. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.  The Company’s plan of operations, even if successful, may not result in cash flow sufficient to finance and expand its business.

Realization of assets is dependent upon continued operations of the Company, which in turn is dependent upon management’s plans to meet its financing requirements and the success of its future operations.  The ability of the Company to continue as a going concern is dependent on improving the Company’s profitability and cash flow and securing additional financing.

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Management is presently seeking to raise permanent equity capital in the capital markets to eliminate negative working capital and raise the necessary funds to satisfy its commitment for the mining rights.  Failure to raise equity capital or secure some other form of long-term debt arrangement will cause the Company to further increase its negative working capital deficit and loss of the ability to acquire the iron ore mine.

The Company believes in the viability of its strategy to generate revenues and profitability and in its ability to raise additional funds, and believes that the actions presently being taken by the Company provide the opportunity for it to continue as a going concern.  However, the Company can give no assurance that such financing will be available on terms advantageous to it, or at all.  Should the Company not be successful in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all of its operational activities.  The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

In Q2, the Company began negotiations and preliminary steps, through Foreign Commerce Consultative, Inc., the Company’s independent contractors in Chile, to sign a five year purchase option for La Plateada for $5,000,000, and 15% royalty  to the current ownership in years two through five. The La Plateada site is expected to produce copper oxides. This contemplated negotiation is not finalized and is subject to material revisions and possible cancelation.

The Company has entered into the structuring phase of the La Crucita project.

Item 3                        Quantitative and Qualitative Disclosures About Market Risks

Smaller reporting companies are not required to provide the information required by this Item.

Item 4                        Controls and Procedures

(a)            Evaluation of Disclosure Controls and Procedures

Our CFO resigned as of August 3, 2012, and as a result there is not an executive officer with financial accounting expertise to assist in the evaluation of disclosure and other financial controls.  We have hired Accounting Management Solutions, an accounting and consulting firm, to assist in the generation of the financial reports for Q3 2012.

Our Chief Executive Officer who also functions as our Chief Financial Officer has reviewed and evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Securities Exchange Act of 1934), as of June 30, 2013.  Based on such review and evaluation, our chief executive officer has concluded that, as of June 30, 2013, our disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in the reports that we file or submit to the Securities and Exchange Commission pursuant to the reporting obligations of the Exchange Act, including this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures.

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A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.  The design of any system of controls also is based in part on certain assumptions regarding the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.  Given these and other inherent limitations of control systems, there is only reasonable assurance that our controls will succeed in achieving their stated goals under all potential future conditions.

Management’s Annual Report on Internal Control Over Financial Reporting

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

● pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company,

● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with US GAAP, and that receipts and expenditures are being made only in accordance with authorizations of management and directors of the company, and

● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

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

Under the supervision and with the participation of our management, we have assessed the effectiveness of our internal control over financial reporting as of June, 2013.  In making this assessment, our management used the criteria described in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.  Due to the inherent issue of segregation of duties in a small company, we have relied heavily on entity or management review controls to lessen the issue of segregation of duties.  Based on this assessment and those criteria, our management concluded that the Company did not maintain effective internal control over financial reporting as of June 30, 2013.  

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.  Our management identified the following material weaknesses as of June 30, 2013:

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On April 20, 2012, our Independent Registered Public Accounting firm advised that we had incorrectly computed the derivative liabilities in the financial statements included in Form 10-Qs filed for June 30, 2011 and September 30, 2011 and, therefore, needed to be restated. In addition upon further review the Form 10-Qs as originally filed, inadvertently omitted the required disclosures relating to development stage entities and the earning per share disclosures.

 (b)                              Changes in Internal Controls Over Financial Reporting

There were no changes in our internal control over financial reporting during the three month period ending June 30, 2013, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1                         Legal Proceedings

The Company is not a party to, or the subject of, any material pending legal proceedings.

Item 1A                      Risk Factors

The Company is a Smaller Reporting Company.  A Smaller Reporting Company is not required to provide the risk factor disclosure required by this form.

Item 2                        Unregistered Sales of Equity Securities and Use of Proceeds

No conversions were made during the first quarter of 2013.

During the first quarter of 2013, $100,000 of convertible notes were sold, on 24 January 2013 with a conversion feature of a discount to market and a floor of $0.0175.  The use of proceeds were used for operating expenses, retirement of other debt, and getting the Company current in its reporting obligations.

Date	Amount, shares	Notable Features
June 12, 2013	12,000,000	Satisfaction of debt
June 20, 2013	13,000,000	Satisfaction of debt
Subsequent Issuances
July 1, 2013	8,000,000	Satisfaction of debt

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Item 3                        Default upon Senior Securities

On 31 May 2012 the Company defaulted on the terms of the lease of the Saltirosa copper mine, the Company’s primary mine. The Company has continued to make payments, as funds become available, to satisfy the obligation; however the Company remains in default. The Grantor of the mineral rights agreement has not shut down the mine, denied the Company access to the mine and property, and has not notified the Company of any default.

Item 4                        Mine Safety Disclosures

The mining projects of the Company are located outside the jurisdiction of the United States. As such, the Company, nor any subsidiary or operator of any mining project, has NOT received any imminent danger order, a written notice of a pattern of violations of mandatory health or safety standards of such nature as could have significantly and substantially contributed to the cause and effect of any mine health or safety hazard, a written notice from the Mine Safety and Health Administration of the potential to have such a pattern. Notwithstanding the aforementioned, the Company has not received any health and safety violation from the Chilean Mining Superintendency.

Item 5                        Other Information

On 24 July 2013, All Grade Mining, Inc. upwardly modified its authorized shares to 1,000,000,000 from 499,450,000.

Item 6                        Exhibits

(a)                                Exhibits and Reports on Form 8-K

Exhibit 31.1	Certification Pursuant to Section 302 of the Sarbanes Oxley Act
Exhibit 32.1	Certification Pursuant to Section 906 of the Sarbanes Oxley Act
101 INS	XBRL Instance Document*
101 SCH	XBRL Schema Document*
101 CAL	XBRL Calculation Linkbase Document*
101 DEF	XBRL Definition Linkbase Document*
101 LAB	XBRL Labels Linkbase Document*
101 PRE	XBRL Presentation Linkbase Document*

*           The XBRL related information in Exhibit 101 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section and shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

(b)           Reports on Form 8-K during Quarter

None.

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SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 9134, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

August 6th, 2013

All Grade Mining, Inc.

/s/Gary Kouletas

Gary Kouletas, CEO

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EX-31.1

Exhibit 31.1

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer and

Chief Financial Officer

I, Gary Kouletas, certify that:

1. I have reviewed this quarterly report of Form 10-Q of All Grade Mining, Inc.

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report.

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and I have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, is made known to me by others within the company, particularly during the period in which this quarterly report is being prepared; and
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements fort external purposes in accordance with generally accepted accounting principles; and
c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based upon such evaluation; and
d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. I have disclosed, based on our most recent evaluation, to the registrant’s auditors and registrant’s board of directors (or persons performing the equivalent function);

a)	All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls.

/s/ Gary Kouletas

Gary Kouletas

President (Principal Executive and Financial Officer)

Date: 6 August 2013

This Certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Report, irrespective of any general incorporation language contained in such filing. A signed original of this written statement required by Section 906 has been provided to All Grade Mining, Inc. and will be retained by All Grade Mining, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2004

In connection with the Quarterly Report of All Grade Mining, Inc. (the “Company”) on Form 10-Q for the quarter ending June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gary Kouletas, President of the Company, respectfully certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2004, that:

That as Chief Executive Officer and Chief Financial Officer, I conducted an evaluation of the effectiveness of our internal control over financial reporting as of June 30, 2013. In making this evaluation, I used the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under the framework in Internal Control – Integrated Framework, I concluded that our internal control over financial reporting was not effective as of June 30, 2013.

The Report fully complies with the requirements of the section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Gary Kouletas

Gary Kouletas

President (Principal Executive and Financial Officer)

Date: 6 August 2013

This Certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Report, irrespective of any general incorporation language contained in such filing. A signed original of this written statement required by Section 906 has been provided to All Grade Mining, Inc. and will be retained by All Grade Mining, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

3) Summary of Significant Accounting Policies: Use of Estimates (Policies)

6 Months Ended

Jun. 30, 2013

Policies

Use of Estimates

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.  The most significant estimates, among other things, are used in accounting for allowances are for deferred income taxes, expected realizable values for long-lived assets (primarily property and equipment), derivative liability and contingencies, as well as the recording and presentation of its common stock issuances.  Estimates and assumptions are periodically reviewed and the effects of any material revisions are reflected in the condensed consolidated financial statements in the period that they are determined to be necessary.  Actual results could differ from those estimates and assumptions.

XML

Consolidated Statements of Operations (USD $)	3 Months Ended		6 Months Ended		85 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Consolidated Statements of Operations
Net Sales					$ 7,500
Cost of Sales					3,135
Gross Profit (Loss)					4,365
Operating Expenses
Officers' compensation	3,752		8,669	25,000	162,669
Mine related expenses	32,600	377,500	32,600	382,500	360,100
Consulting fees	225,000	817,942	652,500	877,942	2,971,921
General and administrative	233,259	43,313	294,285	58,609	877,687
Total Operating Expenses	494,611	1,238,755	988,054	1,344,051	4,372,377
Operating loss	(494,611)	(1,238,755)	(988,054)	(1,344,051)	(4,368,012)
Interest income	2		11		14
Other income					17,509
Change in fair value of derivative liability	(1,464,759)	446,100	(1,379,184)	1,473,200	(344,551)
Interest expense	(194,760)	(184,636)	(338,809)	(209,009)	(1,256,209)
Loss on negotiated debt settlement					(26,100)
Loss on deposit to acquire property					(4,025,000)
Total other income and (expenses)	(1,659,517)	(4,468,536)	(1,717,982)	(3,465,809)	(10,723,650)
Net loss	$ (2,154,128)	$ (5,707,291)	$ (2,706,036)	$ (4,809,860)	$ (15,091,662)
Loss Per Common Share:
Basic and Diluted Loss Per Common Share	$ (0.02)	$ (0.06)	$ (0.02)	$ (0.06)
Weighted average number of common shares outstanding:
Basic and Diluted Weighted average number of common shares outstanding	132,901,780	89,490,297	130,874,581	87,274,528

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5) Depository Payment Towards Acquisition of Iron Ore Mine

6 Months Ended

Jun. 30, 2013

Notes

5) Depository Payment Towards Acquisition of Iron Ore Mine

5)         DEPOSITORY PAYMENT TOWARDS ACQUISITION OF IRON ORE MINE

On September 21, 2011, the Company entered into an agreement to acquire title to an iron ore mine in the Republic of Chile at an acquisition cost of $3,250,000 as of  June 30, 2013 and paid an initial deposit of $250,000 to the seller.  The agreement provides for the participation of the Republic of Chile in 15% of the mining profits.

On April 26, 2012, the Company amended the payment terms of the agreement and paid an additional deposit of $100,000 upon execution of the amended agreement.  Under the terms of the amended agreement, the Company is required to remit the remaining balance of $2,900,000 over a three year period as follows:

		Amount
May 31, 2012	$	400,000
August 31, 2012		500,000
February 28, 2013		500,000
August 31, 2013		500,000
February 28, 2014		500,000
August 31, 2014		500,000
Total	$	2,900,000

As of June 30, 2013, the Company is not in compliance with the terms of this agreement due to non-payment of the amounts due on May 31, 2012, August 31, 2012 and February 28, 2013.  However, the seller has not issued the Company a formal notice of default.

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7) Convertible Debentures: Schedule of Long-term Debt Instruments (Tables)

6 Months Ended

Jun. 30, 2013

Tables/Schedules

Schedule of Long-term Debt Instruments

		June 30, 2013		December 31, 2012
Convertible Debentures	$	1,013,000	$	868,000
Less current portion		81,000		38,000
Less debt discount		508,700		467,200
Long term Convertible Debentures, net of current portion and debt discount	$	423,300	$	362,800

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3) Summary of Significant Accounting Policies: Principle of Consolidation (Policies)

6 Months Ended

Jun. 30, 2013

Policies

Principle of Consolidation

Principle of Consolidation

The condensed consolidated financial statements of All Grade Mining, Inc. and Subsidiary include accounts of the Company and its wholly-owned foreign subsidiary, All Grade Mining Chile, SA.  Intercompany transactions and balances are eliminated in consolidation. All Grade Mining Chile, S.A. was formed in November 2011, has yet to commence operations, and has minimal assets.

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4) Fair Value: Schedule of Changes in Fair Value of Plan Assets (Details) (USD $)	3 Months Ended		6 Months Ended		85 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Dec. 31, 2012
Details
Trading Liabilities, Fair Value Disclosure	$ 1,922,822		$ 1,922,822		$ 1,922,822	$ 209,100
Change in fair value of derivative liability	1,464,759	(446,100)	1,379,184	(1,473,200)	344,551
Included in liabilities			$ 334,538

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4) Fair Value: Fair Value, Liabilities Measured on Recurring Basis (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Details
Trading Liabilities, Fair Value Disclosure	$ 1,922,822	$ 209,100

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9) Common Stock (Details) (USD $)	1 Months Ended
	Jun. 30, 2013
Details
Stock Issued During Period, Shares, New Issues	33,000,000
Settlement of accounts payable	$ 33,000

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8) Loans Payable: Schedule of Short-term Debt (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Loans Payable, Current	$ 291,000	$ 311,000
LouisSavaglioMember
Loans Payable, Current	1,000	1,000
UnrelatedParties1Member
Loans Payable, Current	150,000	150,000
UnrelatedParties2Member
Loans Payable, Current	$ 140,000	$ 160,000

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8) Loans Payable: Schedule of Short-term Debt (Tables)

6 Months Ended

Jun. 30, 2013

Tables/Schedules

Schedule of Short-term Debt

		June 30, 2013		December 31, 2012
Loan payable to Louis Savaglio	$	1,000	$	1,000
Loan payable to unrelated parties		150,000		150,000
Loan payable to unrelated parties		140,000		160,000
Total	$	291,000	$	311,000

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1) Nature of Business and Basis of Presentation

6 Months Ended

Jun. 30, 2013

Notes

1) Nature of Business and Basis of Presentation

1)         NATURE OF BUSINESS AND BASIS OF PRESENTATION

All Grade Mining, Inc. and Subsidiary (a development stage company) (“the Company”) is a corporation organized under the laws of the State of Colorado.  The Company is currently engaged in the acquisition and exploration of mining properties and maintains its corporate offices in Hackensack, New Jersey.

The Company has generated nominal revenues to date; accordingly, the Company is considered a development stage enterprise as defined in the Accounting Standards Codification 915 “Development Stage Entities.”  The Company is subject to a number of risks similar to those of other companies in an early stage of development.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, these interim financial statements do not include all of the information and footnotes required for annual financial statements.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2012 included in the Company’s Annual Report on Form 10-K as filed with the SEC on July 8, 2013.

The results for the six month periods ended June 30, 2013, are not necessarily indicative of the results to be expected for any subsequent quarter or the entire fiscal year.  The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date.

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3) Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2013

Notes

3) Summary of Significant Accounting Policies

3)         SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.  The most significant estimates, among other things, are used in accounting for allowances are for deferred income taxes, expected realizable values for long-lived assets (primarily property and equipment), derivative liability and contingencies, as well as the recording and presentation of its common stock issuances.  Estimates and assumptions are periodically reviewed and the effects of any material revisions are reflected in the condensed consolidated financial statements in the period that they are determined to be necessary.  Actual results could differ from those estimates and assumptions.

Principle of Consolidation

The condensed consolidated financial statements of All Grade Mining, Inc. and Subsidiary include accounts of the Company and its wholly-owned foreign subsidiary, All Grade Mining Chile, SA.  Intercompany transactions and balances are eliminated in consolidation. All Grade Mining Chile, S.A. was formed in November 2011, has yet to commence operations, and has minimal assets.

Derivative Financial Instruments

In connection with the issuance of certain convertible debentures, the terms of the convertible debentures included an embedded conversion feature which provided for a conversion of the convertible debentures into shares of common stock at a rate which was determined to be variable.  The Company determined that the conversion feature was an embedded derivative instrument pursuant to ASC 815 “Derivatives and Hedging”.

The accounting treatment of derivative financial instruments requires that the Company record the conversion options at their fair values as of the inception date of the convertible debenture agreements and at fair value as of each subsequent balance sheet date.  As a result of entering into the convertible promissory note, the Company was required to classify all other conversion options as derivative liabilities and record them at their fair values at each balance sheet date.  Any change in fair value was recorded as a change in fair value of derivative liability for each reporting period at each balance sheet date.  The Company reassesses the classification at each balance sheet date.  If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method and conversion options at variable rates are deemed to be a “down-round protection” and therefore, do not meet the scope exception for treatment as a derivative under ASC 815.  Since, “down-round protection” is not an input into the calculation of the fair value of the conversion option and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. 

Reclassification

Certain accounts in the prior year’s financial statements have been reclassified for comparative purposes to conform to the presentation in the current year’s financial statements.  These reclassifications have no effect on previously reported earnings.

Recent Accounting Pronouncements

The FASB, the Emerging Issues Task Force and the SEC have issued certain accounting standards updates and regulations as of September 30, 2012 that will become effective in subsequent periods; however, management of the Company does not believe that any of those updates would have significantly affected the Company’s financial accounting measures or disclosures had they been in effect during the periods reported upon, and it does not believe that any of those pronouncements will have a significant impact on the Company’s consolidated financial statements at the time they become effective.

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6) Related Party Transactions

6 Months Ended

Jun. 30, 2013

Notes

6) Related Party Transactions

6)         RELATED PARTY TRANSACTIONS

During 2007, Martin Honig, a former Director and current stockholder of the Company loaned the Company $8,000 on a non-interest bearing basis in order to provide the Company with working capital.  In July 2008 this same individual loaned the Company an additional $5,000 to be used for working capital.  The Company repaid $7,000 to Mr. Honig. In March 2012, Mr. Honig loaned the Company an additional $6,000.  In May 2012, Mr. Honig elected to convert his $6,000, 10.0% Loan into common stock of the Company.  In the conversion transaction, Mr Honig received 6,000,000 shares of common stock in exchange for the loan and no accrued interest, resulting in a balance of $ 6,000 due him as of June 30, 2013.

Marshal Shichtman, the Company’s securities counsel and a stockholder of 13,000,000 common shares has billed the Company $60,000 for legal services performed thru June 30, 2013. Marshal Shichtman received 8,000,000 shares of common stock for payment valued at $8,000 applied against account payable.  $229,000 is currently outstanding and reported in accounts payable in the accompanying financial statements.  The Company incurred legal fees for services provided by Marshal Shichtman in the amounts of $60,000 and $60,000 for the six month periods ended June 30, 2013 and 2012, respectively.

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4) Fair Value

6 Months Ended

Jun. 30, 2013

Notes

4) Fair Value

4)         FAIR VALUE

ASC 820 “Fair Value Measurements and Disclosures” defines fair value, establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements.  As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  This guidance clarifies that the exchange price is the price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date and emphasizes that fair value is a market-based measurement and not an entity-specific measurement.

ASC 820 establishes the following hierarchy used in fair value measurements and expands the required disclosures of assets and liabilities measured at fair value:

Level 1            Inputs use quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

Level 2            Inputs use other inputs that are observable, either directly or indirectly. These inputs include quoted prices for similar assets and liabilities in active markets as well as other inputs such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3            Inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset or liability.

In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair measurements requires judgment and considers factors specific to each asset or liability.

Liabilities measured at fair value on a recurring basis at June 30, 2013 and December 31, 2012 are as follows:

	$	Quoted Prices in Active Markets for Identical Liabilities	$	Significant Other Observable Inputs	$	Significant Observable Inputs	$	Balance at
		(Level 1)		(Level 2)		(Level 3)		June 30, 2013
Embedded conversion feature – June 30, 2013		-		-		1,922,822		1,922,822

	$	Quoted Prices in Active Markets for Identical Liabilities	$	Significant Other Observable Inputs	$	Significant Observable Inputs	$	Balance at
		(Level 1)		(Level 2)		(Level 3)		December 31, 2012
Embedded conversion feature – December 31, 2012		-		-		209,100		209,100

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.  The Company’s Level 3 liabilities consist of derivative liabilities associated with the convertible debt that contains an indeterminable conversion share price and the tainted conversion to other outstanding convertible debt as the Company cannot determine if it will have sufficient authorized common stock to settle such arrangements.

The following table provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets measured at fair value on a recurring basis using significant unobservable inputs during the six month period ended June 30, 2013.

			Embedded Conversion Feature
Balance - December 31, 2012		$	209,100
	Included in other income/expense		-
	Change in fair value of derivative liability		1,379,184
	Conversion		-
	Included in liabilities		334,538
	Included in stockholders' equity		-
	Transfers in and/or out of Level 3		-
Balance - June 30, 2013		$	1,922,822

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5) Depository Payment Towards Acquisition of Iron Ore Mine (Details) (USD $)	Aug. 31, 2014	Feb. 28, 2014	Jun. 30, 2013	Feb. 28, 2013	Aug. 31, 2012	May 31, 2012	Apr. 26, 2012	Sep. 21, 2011
Details
Acquisition Costs, Cumulative			$ 3,250,000				$ 2,900,000
Security Deposit							100,000	250,000
Acquisition Payments	$ 500,000	$ 500,000		$ 500,000	$ 500,000	$ 400,000	$ 2,900,000

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8) Loans Payable: Louis Savaglio (Details) (LouisSavaglioMember, USD $)	Jun. 30, 2013	Dec. 31, 2012	Jul. 14, 2011	Nov. 30, 2009	Dec. 31, 2006
LouisSavaglioMember
Debt Instrument, Face Amount					$ 16,000
Convertible Debt Interest Rate					6.75%
Payment on Debt				5,000
Shares Issued for debt				99,100
Debt Assigned			10,000
Accrued Interest of Debt Assigned			3,156
Note for each new entity			3,289
Interest rate on note for each new entity			6.00%
Shares Issued for converted loan			13,462,000
Loan Balance	$ 1,000	$ 1,000

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Consolidated Balance Sheets Parenthetical (USD $)	Jun. 30, 2013	Dec. 31, 2012
Consolidated Balance Sheets Parenthetical
Debt Discount, Current	$ 57,000
Debt Discount	$ 451,700	$ 467,200
Convertible Preferred Stock Class A par value
Convertible Preferred Stock Class A shares authorized	100,000	100,000
Convertible Preferred Stock Class A shares issued	20,000	20,000
Convertible Preferred Stock Class A shares outstanding	20,000	20,000
Convertible Preferred Stock Class B par value
Convertible Preferred Stock Class B shares authorized	400,000	400,000
Convertible Preferred Stock Class B shares issued
Convertible Preferred Stock Class B shares outstanding
Preferred Stock Class C par value
Preferred Stock Class C shares authorized	50,000	50,000
Preferred Stock Class C shares issued	20,000	20,000
Preferred Stock Class C shares outstanding	20,000	20,000
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	500,000,000	500,000,000
Common stock shares issued	161,824,857	128,824,857
Common stock shares outstanding	161,824,857	128,824,857

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9) Common Stock

6 Months Ended

Jun. 30, 2013

Notes

9) Common Stock

9)         COMMON STOCK

There were 500,000,000 shares of common stock authorized, with 161,824,857 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively. The par value for the common stock is $.001 per share.

There were common stock transactions for the six months ended June 30, 2013.

In June 2013, The Company issued 33,000,000 shares of common stock on settlement of accounts payable of $33,000. The fair market value of the shares at the date of issuance aggregated $222,500, the excess of the fair value over the amount of the payable amounted to $189,500 and has been charged to operations during the six and three months ended June 30, 2013 and is included in General and administrative expenses on the accompanying consolidated statement of operations.

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Consolidated Statements of Cash Flows (USD $)	6 Months Ended		85 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$ (2,706,036)	$ (4,809,860)	$ (15,091,662)
Depreciation expense		44	9,260
Impairment of equipment			3,907
Issuance of stock for services		282,500	1,948,500
Amortization of debt discount	103,500	43,400	228,400
Change in fair value of derivative liability	1,379,184	(1,473,200)	344,551
Non-cash Interest Expense	189,538		884,071
Issuance of stock for mine costs		377,500
Loss on debt conversion	189,500	4,730,000	5,278,813
Loss on deposit to acquire property			4,025,000
(Increase) Decrease in prepaid expenses	470,000	(27,800)
Increase in Accounts Payable	207,199	398,084	1,028,285
Increase in Accrued interest payable	42,242	25,425	147,827
Increase in Payroll taxes payable			8,716
NET CASH USED IN OPERATING ACTIVITES	(124,873)	(453,907)	(1,184,332)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment			(13,473)
Depository payment towards acquisition of iron ore mine		(100,000)	(350,000)
NET CASH USED IN INVESTING ACTIVITIES		(100,000)	(363,473)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash Proceeds (repayment) from advances		(802)	6,000
Cash Proceeds (repayment) from loans	(20,000)	21,000	303,900
Cash Proceeds, net of repayments, from issuance of convertible debentures	145,000	532,683	1,148,000
Issuance of common stock for cash			90,391
NET CASH PROVIDED BY FINANCING ACTIVITIES	125,000	552,881	1,548,291
(DECREASE) INCREASE IN CASH	127	(1,026)	486
CASH - BEGINNING OF PERIOD	359	1,040
CASH - END OF PERIOD	486	14	486
Supplemental Disclosure:
Cash Paid for Interest
Cash Paid for Income Taxes
Non-cash investing and financing activities:
Debt discount related to convertible debentures	$ 145,000	$ 382,100	$ 831,600
Issuance of common stock for the settlement of debt	33,000	226,383	288,757

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Consolidated Balance Sheets (USD $)	Jun. 30, 2013	Dec. 31, 2012
Current Asset
Cash	$ 486	$ 359
PROPERTY AND EQUIPMENT - Net	306	306
OTHER ASSETS
Depository payment towards acquisition of iron ore mine	350,000	350,000
Prepaid Expenses		470,000
Total Other Assets	350,000	820,000
TOTAL ASSETS	350,792	820,665
Current Liabilites
Accounts Payable	936,310	762,111
Taxes payable	8,716	8,716
Accrued interest payable	124,927	82,685
Due to stockholders	6,000	6,000
Loans payable	291,000	311,000
Convertible debentures, net of debt discount of $57,000 and $0 as of June 30, 2013 and December 31, 2012	81,000	38,000
Derivative liability	1,922,822	209,100
Total Current Liabilites	3,370,775	1,417,612
Convertible debentures, net of debt discount of $451,700 and $467,200 as of June 30, 2013 and December 31, 2012, net of current portion	423,300	362,800
Total liabilities	3,794,075	1,780,412
Stockholders' Deficit (Note 8)
Convertible Preferred Stock Class A, no par value, 100,000 shares authorized at June 30, 2013 and December 31, 2012. Issued and outstanding 20,000 shares at June 30, 2013 and December 31, 2012.	46,000	46,000
Convertible Preferred Stock Class B, no par value, 400,000 shares authorized at June 30, 2013 and December 31, 2012. None issued and outstanding at June 30, 2013 and December 31, 2012.
Preferred Stock Class C, no par value, 50,000 shares authorized at June 30, 2013 and December 31, 2012. Issued and outstanding 20,000 shares at June 30, 2013 and December 31, 2012.	9,000	9,000
Common stock, par value $.001 per share; authorized 500,000,000 shares, issued and outstanding 161,824,857 and 128,824,857 shares at June 30, 2013 and December 31, 2012	161,825	128,825
Additional Paid in Capital	11,431,554	11,242,054
Deficit Accumulated During the Development Stage	(12,385,626)	(12,385,626)
Total Stockholders' Deficit	(737,247)	(959,747)
Total Liabilities and Stockholders' Deficit	$ 3,056,828	$ 820,665

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6) Related Party Transactions (Details) (USD $)	1 Months Ended	12 Months Ended			6 Months Ended
	Mar. 31, 2012	Dec. 31, 2008	Dec. 31, 2007	Jun. 30, 2013	Jun. 30, 2013 MarshalShichtmanMember	Jun. 30, 2012 MarshalShichtmanMember
Proceeds from Related Party Debt	$ 6,000	$ 5,000	$ 8,000
Repayments of Related Party Debt	7,000
Balance Due				6,000
Common Shares					13,000,000
Legal Fees					$ 60,000	$ 60,000

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4) Fair Value: Schedule of Changes in Fair Value of Plan Assets (Tables)

6 Months Ended

Jun. 30, 2013

Tables/Schedules

Schedule of Changes in Fair Value of Plan Assets

			Embedded Conversion Feature
Balance - December 31, 2012		$	209,100
	Included in other income/expense		-
	Change in fair value of derivative liability		1,379,184
	Conversion		-
	Included in liabilities		334,538
	Included in stockholders' equity		-
	Transfers in and/or out of Level 3		-
Balance - June 30, 2013		$	1,922,822

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8) Loans Payable

6 Months Ended

Jun. 30, 2013

Notes

8) Loans Payable:

8)         LOANS PAYABLE:

Loans payable consist of the following at June 30, 2013 and December 31, 2012:

		June 30, 2013		December 31, 2012
Loan payable to Louis Savaglio	$	1,000	$	1,000
Loan payable to unrelated parties		150,000		150,000
Loan payable to unrelated parties		140,000		160,000
Total	$	291,000	$	311,000

(a)                In 2006, the Company borrowed the sum of $16,000 from Louis Savaglio, an independent third party.  The loan is payable on demand and bears interest at the rate of 6.75% per annum. On November 30, 2009, the Company had repaid $5,000 with the issuance of 99,100 shares of common stock.  On July 14, 2011 Mr. Savaglio assigned $10,000 of his debt together with accrued interest of $3,156 to four entities unrelated to the Company.  Each new entity has a note for $3,289 carrying interest at 6%. Subsequently those four entities converted their loans into 13,462,000 shares of the Company’s common stock.  The balance due to Mr. Savaglio as of June 30, 2013 and December 31, 2012 was $1,000.

(b)               On September 15, 2011, the Company borrowed $150,000 from an unrelated third party. The loan was due on October 15, 2011 together with interest at a rate of 25% per annum.  As of June 30, 2013, the accumulated interest on this loan was $47,015.  The Company is not in compliance with the repayment terms of the loan as it was not repaid on its maturity date and is currently in technical default.

(c)                On November 15, 2011, the Company borrowed $50,000 from an unrelated third party.  The loan was due and payable upon the Company filing its Regulation D Offering with the SEC which occurred on August 1, 2011.  The note accrues interest at a rate of 4.0% per annum. As of June 30, 2013, the accumulated interest on this loan was $4,405; the Company is not in compliance with the repayment terms of the loan and is currently in technical default.

(d)               On June 30, 2012, July 24, 2012, September 25, 2012 and November 8, 2012. The Company borrowed $25,000, $50,000 and $15,000 from an unrelated third party.  These notes accrue interest at a rate of 0% per annum.

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7) Convertible Debentures: Schedule of Long-term Debt Instruments (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Details
Convertible Debt	$ 1,013,000	$ 868,000
Convertible debentures, net of debt discount of $57,000 and $0 as of June 30, 2013 and December 31, 2012	81,000	38,000
Debt Instrument Unamortized Discount Current and NonCurrent	508,700	467,200
Convertible debentures, net of debt discount of $451,700 and $467,200 as of June 30, 2013 and December 31, 2012, net of current portion	$ 423,300	$ 362,800

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11) Subsequent Events

6 Months Ended

Jun. 30, 2013

Notes

11) Subsequent Events

11)       SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, The Company has analyzed its operations subsequent to the date these financial statements were issued, and has determined that it does not have material subsequent events to disclose in these financial statements.

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7) Convertible Debentures

6 Months Ended

Jun. 30, 2013

Notes

7) Convertible Debentures

 7)        CONVERTIBLE DEBENTURES

On January 24, 2013, the Company borrowed $100,000 from an unrelated party pursuant to convertible debenture agreements.  The debentures bear interest at 8.0% per annum and have a term of one year, maturing on January 24, 2014. The loan agreement provides for the right of the holder to convert the loan principal and interest into shares of common stock at a stated conversion price of the average of the three lowest daily trades in the previous 20 days with a 50% discount.

On April 22, 2012 the Company borrowed $15,000 from a unrelated party pursuant to convertible debenture agreement. The debentures bear interest at 6% per annum and have a term of one and a quarter years, maturing on August 31, 2014. The debentures are convertible into common stock at $0.25 per share.

On May 24, 2013, the Company borrowed $30,000 from an unrelated party pursuant to convertible debenture agreements.  The debentures bear interest at 10% per annum and have a term of one year, maturing on May 24, 2014. The loan agreement provides for the right of the holder to convert the loan principal and interest into shares of common stock at a stated conversion price of the average of the three lowest daily trades in the previous 20 days with a 50% discount.

As of June 30, 2013 and December 31, 2012 convertible debentures consist of the following:

		June 30, 2013		December 31, 2012
Convertible Debentures	$	1,013,000	$	868,000
Less current portion		81,000		38,000
Less debt discount		508,700		467,200
Long term Convertible Debentures, net of current portion and debt discount	$	423,300	$	362,800

The Company accounted for the issuance of the convertible debenture in accordance with ASC 815” Derivatives and Hedging.”  The debenture is convertible into an indeterminate number of shares for which the Company cannot determine if it has sufficient authorized shares to settle the transaction with.  Accordingly, the embedded conversion option is a derivative liability and is marked to market through earnings at the end of each reporting period. 

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2) Going Concern

6 Months Ended

Jun. 30, 2013

Notes

2) Going Concern

2)         GOING CONCERN

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred operating losses and negative operating cash flow since inception and future losses are anticipated. In addition the company is not in compliance with its acquisition agreement regarding its purchase of the mine. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.  The Company’s plan of operations, even if successful, may not result in cash flow sufficient to finance and expand its business.

Realization of assets is dependent upon continued operations of the Company, which in turn is dependent upon management’s plans to meet its financing requirements and the success of its future operations.  The ability of the Company to continue as a going concern is dependent on improving the Company’s profitability and cash flow and securing additional financing.

Management is presently seeking to raise permanent equity capital in the capital markets to eliminate negative working capital and raise the necessary funds to satisfy its commitment for the mining rights.  Failure to raise equity capital or secure some other form of long-term debt arrangement will cause the Company to further increase its negative working capital deficit and loss of the ability to acquire the iron ore mine.

The Company believes in the viability of its strategy to generate revenues and profitability and in its ability to raise additional funds, and believes that the actions presently being taken by the Company provide the opportunity for it to continue as a going concern.  However, the Company can give no assurance that such financing will be available on terms advantageous to it, or at all.  Should the Company not be successful in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all of its operational activities.  The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

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8) Loans Payable (Details) (USD $)	Jun. 30, 2013 UnrelatedParties1Member	Sep. 15, 2011 UnrelatedParties1Member	Jun. 30, 2013 UnrelatedParties2Member	Nov. 15, 2011 UnrelatedParties2Member	Jun. 30, 2013 UnrelatedParties3	Sep. 25, 2012 UnrelatedParties3	Jul. 24, 2012 UnrelatedParties3	Jun. 30, 2012 UnrelatedParties3
Debt Instrument, Face Amount		$ 150,000		$ 50,000		$ 15,000	$ 50,000	$ 25,000
Convertible Debt Interest Rate	25.00%		4.00%		0.00%
Accumulated interest	$ 47,015		$ 4,405

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3) Summary of Significant Accounting Policies: Derivative Financial Instruments (Policies)

6 Months Ended

Jun. 30, 2013

Policies

Derivative Financial Instruments

Derivative Financial Instruments

In connection with the issuance of certain convertible debentures, the terms of the convertible debentures included an embedded conversion feature which provided for a conversion of the convertible debentures into shares of common stock at a rate which was determined to be variable.  The Company determined that the conversion feature was an embedded derivative instrument pursuant to ASC 815 “Derivatives and Hedging”.

The accounting treatment of derivative financial instruments requires that the Company record the conversion options at their fair values as of the inception date of the convertible debenture agreements and at fair value as of each subsequent balance sheet date.  As a result of entering into the convertible promissory note, the Company was required to classify all other conversion options as derivative liabilities and record them at their fair values at each balance sheet date.  Any change in fair value was recorded as a change in fair value of derivative liability for each reporting period at each balance sheet date.  The Company reassesses the classification at each balance sheet date.  If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method and conversion options at variable rates are deemed to be a “down-round protection” and therefore, do not meet the scope exception for treatment as a derivative under ASC 815.  Since, “down-round protection” is not an input into the calculation of the fair value of the conversion option and cannot be considered “indexed to the Company’s own stock” which is a requirement for the scope exception as outlined under ASC 815. 

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10) Commitments and Contingencies

6 Months Ended

Jun. 30, 2013

Notes

10) Commitments and Contingencies

10)       COMMITMENTS AND CONTINGENCIES

a)         Depository payment towards acquisition of iron ore mine

See disclosures in Note 5 regarding obligations in connection with the acquisition of an iron ore mine.

b)         Litigation

Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur.  The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment.  In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements.  If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.  There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.  As of June 30, 2013, the Company has not accrued any amounts for loss contingencies.

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4) Fair Value: Fair Value, Liabilities Measured on Recurring Basis (Tables)

6 Months Ended

Jun. 30, 2013

Tables/Schedules

Fair Value, Liabilities Measured on Recurring Basis

	$	Quoted Prices in Active Markets for Identical Liabilities	$	Significant Other Observable Inputs	$	Significant Observable Inputs	$	Balance at
		(Level 1)		(Level 2)		(Level 3)		June 30, 2013
Embedded conversion feature – June 30, 2013		-		-		1,922,822		1,922,822

	$	Quoted Prices in Active Markets for Identical Liabilities	$	Significant Other Observable Inputs	$	Significant Observable Inputs	$	Balance at
		(Level 1)		(Level 2)		(Level 3)		December 31, 2012
Embedded conversion feature – December 31, 2012		-		-		209,100		209,100

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3) Summary of Significant Accounting Policies: Reclassification (Policies)

6 Months Ended

Jun. 30, 2013

Policies

Reclassification

Reclassification

Certain accounts in the prior year’s financial statements have been reclassified for comparative purposes to conform to the presentation in the current year’s financial statements.  These reclassifications have no effect on previously reported earnings.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 29, 2013
Document and Entity Information:
Entity Registrant Name	ALL GRADE MINING, INC.
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Amendment Flag	false
Entity Central Index Key	0000823544
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		239,990,626
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2

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3) Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)

6 Months Ended

Jun. 30, 2013

Policies

Recent Accounting Pronouncements

Recent Accounting Pronouncements

The FASB, the Emerging Issues Task Force and the SEC have issued certain accounting standards updates and regulations as of September 30, 2012 that will become effective in subsequent periods; however, management of the Company does not believe that any of those updates would have significantly affected the Company’s financial accounting measures or disclosures had they been in effect during the periods reported upon, and it does not believe that any of those pronouncements will have a significant impact on the Company’s consolidated financial statements at the time they become effective.