August 12, 2022*

Dear Shareholders,

You have received many letters from me over the past forty years. This may be one of the most important. The hostile takeover by Quartzview succeeded in March, 2022. You now must decide whether to continue with Original Sixteen to One Mine, Inc. or sell your shares for $1.00 each. It is not appropriate for me to recommend either option over the other.

We all know the mine is one of the best. Operating the mine and company are unique responsibilities. Quartzview has not provided a short term and long term plan of its operation. Speculations or assumptions are not prudent. I personally have sold most, but not all of my shares. The existing Board of Directors and officers will resign as soon as appropriate.

In March 2022, Roger Haas sent our Board of Directors the following:

If you choose to sell, pay close attention to this letter. I was not a willing seller. However, after other large shareholders committed to sell their shares, I knew the inevitable outcome. Quartzview immediately refused to honor it’s commitment to all shareholders once it acquired controlling interest. My concern, therefore, was to obtain a written guarantee that the same offer is available to you and all shareholders: that Quartzview will purchase all shares for $1.00 each.

If your offer to sell your shares is refused for any reason, ask Roger Haas for a detailed explanation why it has been refused. Mr. Haas seems willing to help solve problems. Let me know if I can be of help. I remain committed to each of you. Contact me by email at original1621@gmail.com.

To sell your shares, please include the following information:

  • Your stock certificate number
  • Amount of shares and the exact name on the certificate.
  • List all your contact information, and send to EACH of the three addresses below:

Do not mail your certificate until Quartzview has replied to your request to sell.

US Post Office

Quartzview 10 Timber Ridge Lane, Scotts Valley, CA 95066

Email

Roger Haas at:

rogerhaas@cruzio.com

Email

Michael M. Miller at:

original1621@gmail.com

Roger Haas is your primary contact: (408) 672-5610. If your stock certificate is lost or misplaced, a system exists to certify your ownership and issue a replacement. For payment Quartzview requires the endorsed certificates, your bank account number and the bank routing number to wire the money. I repeat, do NOT mail your certificate until Quartzview  has replied to your request to sell.

Sincerely yours,

Michael Meister Miller

Director and President

THE 2022 ANNUAL SHAREHOLDER’S MEETING HAS BEEN POSTPONED UNTIL FURTHER NOTICE.

 

Excerpts from the Security and Exchange Commission (SEC)

10-K 2021 for Original Sixteen to One Mine, Inc.

Last summer and thru the fall the Company had the pleasure of going through an IRS audit for the years 2018 and 2019. This entailed giving them access to all bank accounts, submitting numerous documents and along with many written explanations. There were numerous emails, phone conversations and even a personal visit to the mine and mine office by the IRS Agent and her Supervisor. Most of the focus centered around the Net Loss Carryover being carried over year to year on the tax returns and how the COGS (Cost of Goods Sold) had been determined.

COGS is simple for producers and retailers buy wholesale and sell at a markup. For us, this is perplexing with no way to calculate or predict future gold production. Farmers have it easier when figuring COGS: plant X acres with Y seeds producing Z amount of crop. A miner doesn’t know what he has until it is found. His really becomes the expenses of finding gold. All but administration become the mine’s cost basis.

We had a long and detailed discussion with the IRS Agent and her supervisor Capitalizing mine expenses seemed the appropriate accounting methodology. To capitalize entails recording a cost or expense on the balance sheet, thus delaying full recognition of the expense until production. Mine expenses are considered as “work in progress” and put as an asset on the Balance Sheet.

The IRS agents thought the accounting method could be “double-dipping” by not capitalizing expenses. They asked for financial reports going back to the 1990’s. We gave them accurate reports for the last 10 years and that sufficed. Since the accounting is unfavorable to the Company, it is not viewed as intentional but a mistake. The $1,900 request was immediately mailed to the IRS. There were no penalties for an unwanted mistake.

The IRS report entitled Income Tax Examination Changes Letter arrived in May. The financial statements were incorrect for years and did not reflect the financial conditions of the corporation. The losses were over-stated and compounding in the Retained Earnings every year, not a true or good looking asset value.

The form also states: “Available Net Operating Loss will be entirely disallowed. Net Operating Loss as of 1/1/2022 is $0. There is also $0 of carryforward Net Operating Loss Deduction for tax years under examination.”

We adjusted our 2021 financial reports to reflect the changes. Financials before the year 2000 showed a capitalization of some mine expenses. In 2001 they were removed from the Balance Sheet and shown as an $800,000 loss. Ouch! Our financial reports were overstating losses for the past 20 years making the Retained Earnings and Stockholder’s Equity all wrong.

During 2021, no time was spent detecting for and mining gold. Management placed rehabilitation/maintenance ahead of mining for gold. Operating capital came from a shareholder’s advances.

Relations with federal and California regulators improved significantly during 2021. California is known for active environmental perspectives and advocates. Its reputation is global. Significant progress continues towards achieving lawful and reasonable interpretation of the Porter Cologne Act, the basis of water administration. In 2020, the five-year renewal for the permit was approved by the Central Valley Regional Water Control Board. The permit is binding to 2025. The Board of Directors reaffirmed its debt reduction plan to encourage private financial participation by a shareholder and present an improved balance sheet for others.

Attempts to introduce the mine to established gold mining companies were not possible due to civil and criminal charges levied against the Company and president. In 2021, criminal charges were dismissed by Sierra County District Attorney, which took the prosecution from the California District Attorneys Association, a non-government corporation. Company accepted a forced settlement due to its lack of defense funds.

No corporate funds were spent on unpatented mining claims during 2021. On September 1, 2020, the company hand delivered check number 15699 for $2,610.00 to the Bureau of Land Management (BLM) for unpatented claims fees. BLM misplaced the check which created a loss of all unpatented claims. The Company’s fight to mitigate this was unsuccessful.

Original Sixteen to One Mine, Inc. is a distinct company. It is the only known operating company of its kind remaining in the United States. The assets of the Company are understated due to the age of acquisition. Exploration and development expenses are now capitalized instead of expensed. The Company celebrated its 110-year anniversary on Oct. 9, 2021

 

Directors Meeting July 23, 2021

Motion from Robert Besso / Seconded by Hugh Dan O’Neill

Whereas Director and President, Michael Meister Miller, committed  years at an industry low salary, served our Company, mine and shareholders with countless sacrifices,  provided notices to shareholders and the public, we move and approve his transfer of ownership of the inactive Plumbago mine to himself. This decision is in appreciation of his contributions and services to Original Sixteen to One Mine, Inc. It is a grateful gift to a miner who deserves it.

 

Robert Besso: Aye   –   Hugh Dan O’Neill: Aye   –   Michael Miller: Abstain

 

Respectfully submitted,

Hugh Daniel O’Neill, Secretary

 

*This letter was physically mailed to all Shareholders on August 26th, 2022. If you have not received a letter in the mail due to a bad address, you may download and print the PDF by clicking here > Shareholder’s Letter 2022