UNITED STATES


SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


(Mark One)

x☒ Quarterly Report Pursuant to Section 13 Or 15(d) Of The Securities Exchange Act of 1934

For the quarterly period endedJulyOctober 31, 2019

o

☐ Transition Report Under Section 13 Or 15(d) Of The Securities Exchange Act of 1934

For the transition period ________ to ________

COMMISSION FILE NUMBER 000-52711

STAR GOLD CORP.

(Exact name of small business issuer as specified in its charter) 

NEVADA27-0348508
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
  
1875 N. Lakewood Drive, Suite 200

Coeur d'Alene,d’Alene, Idaho
83814
(Address (Address of principal executive office)
(Postal Code)
(208) 664-5066
(Issuer'sIssuer’s telephone number)

Name of Each Exchange on Which
Title of Each ClassTrading SymbolRegistered
Common Stock,SRGZOTCQB

Indicate by check mark whether the issuer (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.YesYes  ☒x No ☐o

Indicate by checkmark 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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post filed).Yes ☒. Yesx No ☐

o

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “Accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):

Large Accelerated Filer ☐oAccelerated Filer ☐o
Non-Accelerated Filer ☐oSmaller Reporting Company ☒x
Emerging Growth Company ☐o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐   oNo ☒x

As ofSeptemberDecember 13, 2019there were77,394,841shares of registrant’s common stock, $0.01 par value, issued and outstanding.

Page 1 of26

Page 1 of 24

Contents  
   
PART I - FINANCIAL INFORMATION
3
 
ITEM 1.
FINANCIAL STATEMENTS
3
   
ITEM 1.
FINANCIAL STATEMENTS3
ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION
15
14ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK23
ITEM 4.CONTROLS AND PROCEDURES23
PART II - OTHER INFORMATION24
   
ITEM 3.1.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKLEGAL PROCEEDINGS
20
24
   
ITEM 4.1A.
CONTROLS AND PROCEDURESRISK FACTORS
20
24
   
PART II - OTHER INFORMATION
21
 
ITEM 1.2.
LEGAL PROCEEDINGSRECENT SALES OF UNREGISTERED SECURITIES
21
24
   
ITEM 1A.3.
RISK FACTORSDEFAULTS UPON SENIOR SECURITIES
21
24
   
ITEM 2.4.
RECENT SALES OF UNREGISTERED SECURITIESMINE SAFETY DISCLOSURES
21
24
   
ITEM 3.5.
DEFAULTS UPON SENIOR SECURITIESOTHER INFORMATION
21
24
   
ITEM 4.
MINE SAFETY DISCOSURES
21
 
ITEM 5.6.
OTHER INFORMATIONEXHIBITS
22
 
ITEM 6.
EXHIBITS
22
25

Page 2 of26


Page 2 of 24

PARTPART I - FINANCIAL INFORMATION

ITEM 1.
FINANCIAL STATEMENTS
STAR GOLD CORP.
BALANCE SHEETS (UNAUDITED)

 
 July 31, 2019 
 April 30, 2019 
ASSETS
   
   
CURRENT ASSETS
   
   
Cash and cash equivalents
 $339,620 
 $440,316 
Other current assets (NOTE 5)
  20,740 
  22,845 
TOTAL CURRENT ASSETS
  360,360 
  463,161 
EQUIPMENT AND MINING INTEREST, net (NOTE 4)
  478,691 
  467,107 
OTHER ASSETS – NON-CURRENT (NOTE 5)
  457 
  2,557 
RECLAMATION BOND
  21,600 
  21,600 
TOTAL ASSETS
 $861,108 
 $954,425 
 
    
    
LIABILITIES AND STOCKHOLDERS’ EQUITY
    
    
CURRENT LIABILITIES:
    
    
Accounts payable
 $50,380 
 $19,246 
TOTAL CURRENT LIABILITIES
  50,380 
  19,246 
 
    
    
TOTAL LIABILITIES
  50,380 
  19,246 
COMMITMENTS AND CONTINGENCIES (NOTE 4)
    
    
STOCKHOLDERS’ EQUITY
    
    
Preferred Stock, $.001 par value; 10,000,000 shares authorized, none issued and outstanding
  - 
  - 
Common Stock, $.001 par value; 300,000,000 shares authorized; 77,394,841 shares issued and outstanding
  77,395 
  77,395 
Additional paid-in capital
  11,560,527 
  11,560,527 
Accumulated deficit
  (10,827,194)
  (10,702,743)
TOTAL STOCKHOLDERS’ EQUITY
  810,728 
  935,179 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 $861,108 
 $954,425 

ITEM 1.FINANCIAL STATEMENTS

STAR GOLD CORP.
BALANCE SHEETS (UNAUDITED)

  October 31, 2019  April 30, 2019 
ASSETS        
CURRENT ASSETS        
Cash and cash equivalents $100,567  $440,316 
Other current assets (NOTE 5)  16,988   22,845 
         
TOTAL CURRENT ASSETS  117,555   463,161 
EQUIPMENT AND MINING INTEREST, net (NOTE 4)  544,318   467,107 
OTHER ASSETS – NON-CURRENT (NOTE 5)  -   2,557 
RECLAMATION BOND (NOTE 4)  89,400   21,600 
         
TOTAL ASSETS $751,273  $954,425 
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
CURRENT LIABILITIES:        
Accounts payable and accrued liabilities $34,590  $19,246 
         
TOTAL CURRENT LIABILITIES  34,590   19,246 
         
TOTAL LIABILITIES  34,590   19,246 
         
COMMITMENTS AND CONTINGENCIES (NOTE 4)        
         
STOCKHOLDERS’ EQUITY        
Preferred Stock, $.001 par value; 10,000,000 shares authorized, none issued and outstanding  -   - 
Common Stock, $.001 par value; 300,000,000 shares authorized; 77,394,841 shares issued and outstanding  77,395   77,395 
Additional paid-in capital  11,576,571   11,560,527 
Accumulated deficit  (10,937,283)  (10,702,743)
         
TOTAL STOCKHOLDERS’ EQUITY  716,683   935,179 
         
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $751,273  $954,425 
         

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

Page 3 of26

Page 3 of 24

STAR GOLD CORP.
STATEMENTS OF OPERATIONS (UNAUDITED)

 
 For the three months ended 
 
 July 31, 2019 
 July 31, 2018 
OPERATING EXPENSE
   
   
Mineral exploration expense
 $26,630 
 $24,628 
Pre-development expense
  29,073 
  45,046 
Legal and professional fees
  40,260 
  29,895 
Management and administrative
  28,343 
  31,452 
Depreciation
  416 
  416 
TOTAL OPERATING EXPENSES
  124,722 
  131,437 
LOSS FROM OPERATIONS
  (124,722)
  (131,437)
OTHER INCOME (EXPENSE)
    
    
Interest expense
  (215)
  (200)
Interest income
  486 
  558 
TOTAL OTHER INCOME (EXPENSE)
  271 
  358 
NET LOSS
 $(124,451)
 $(131,079)
Basic and diluted loss per share
 $- 
 $- 
Basic and diluted weighted average number shares outstanding
  77,394,841 
  76,434,424 
 
    
    
STAR GOLD CORP.
STATEMENTS OF OPERATIONS (UNAUDITED)

  Three months ended October 31,  Six months ended October 31, 
  2019  2018  2019  2018 
OPERATING EXPENSE                
Mineral exploration expense $-  $(4,714) $26,630  $19,914 
Pre-development expense  28,690   45,766   57,763   90,812 
Legal and professional fees  19,462   5,357   59,722   35,252 
Management and administrative  61,518   38,490   89,860   69,942 
Depreciation  416   416   833   832 
TOTAL OPERATING EXPENSES  110,086   85,315   234,808   216,752 
LOSS FROM OPERATIONS  (110,086)  (85,315)  (234,808)  (216,752)
OTHER INCOME (EXPENSE)                
Interest expense  (233)  (200)  (448)  (400)
Interest income  230   591   716   1,149 
TOTAL OTHER INCOME (EXPENSE)  (3)  391   268   749 
NET LOSS $(110,089) $(84,924)  (234,540)  (216,003)
Basic and diluted loss per share $Nil  $Nil  $Nil  $Nil 
Basic and diluted weighted average number shares outstanding  77,394,841   76,483,930   77,394,841   76,459,832 
                 

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

Page 4 of26

Page 4 of 24

STAR GOLD CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
For the three months ended July 31, 2019 and 2018 (UNAUDITED)

 
 Common Stock 
   
   
   
 
 Shares
Issued 
 Par Value
$.001 per share 
 Additional
Paid in Capital 
 Accumulated
Deficit 
 Total
Stockholders’Equity 
BALANCE, April 30, 2018
  76,434,424 
 $76,434 
 $11,501,613 
 $(10,367,039)
 $1,211,008 
  Net loss
  - 
  - 
  - 
  (131,079)
  (131,079)
BALANCE, July 31, 2018
  76,434,424 
 $76,434 
 $11,501,613 
 $(10,498,118)
 $1,079,929 
 
    
    
    
    
    
 
    
    
    
    
    
BALANCE, April 30, 2019
  77,394,841 
 $77,395 
 $11,560,527 
 $(10,702,743)
 $935,179 
  Net loss
  - 
  - 
  - 
  (124,451)
  (124,451)
BALANCE, July 31, 2019
  77,394,841 
 $77,395 
 $11,560,527 
 $(10,827,194)
 $810,728 
 
    
    
    
    
    
STAR GOLD CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
For the three and six months ended October 31, 2019 and 2018 (UNAUDITED)

  Common Stock          
  Shares  Par Value  Additional  Accumulated  Total 
  Issued  $.001 per share  Paid in Capital  Deficit  Stockholders’ Equity 
BALANCE, April 30, 2018  76,434,424  $76,434  $11,501,613  $(10,367,039) $1,211,008 
Net loss  -   -   -   (131,079)  (131,079)
BALANCE, July 31,2018  76,434,424   76,434   11,501,613   (10,498,118)  1,079,929 
Net loss  -   -   -   (84,924)  (84,924)
Common stock issued at $0.06 per share in lieu of cash for vendor payable  960,417   961   56,664   -   57,625 
BALANCE, October 31,2018  77,394,841  $77,395  $11,558,277  $(10,583,042) $1,052,630 
                     
BALANCE, April 30, 2019  77,394,841  $77,395  $11,560,527  $(10,702,743) $935,179 
Net loss  -   -   -   (124,451)  (124,451)
BALANCE, July 31, 2019  77,394,841   77,395   11,560,527   (10,827,194)  810,728 
Net loss  -   -   -   (110,089)  (110,089)
Options issued for mining interest  -   -   16,044   -   16,044 
BALANCE, October 31,2019  77,394,841  $77,395  $11,576,571  $(10,937,283) $716,683 
                     

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

Page 5 of26

STAR GOLD CORP.
STATEMENTS OF CASH FLOWS (UNAUDITED)

  For the six months ended 
  October 31, 2019  October 31, 2018 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net loss $(234,540) $(216,003)
Adjustments to reconcile net loss to net cash used by operating activities        
Depreciation  833   832 
Changes in operating assets and liabilities:        
   -   3,79 
Other current assets  5,857   5 
Other assets  2,557   3,781 
Accounts payable  15,344   (10,768)
Net cash used by operating activities  (209,949)  (218,363)
CASH FLOWS FROM INVESTING ACTIVITIES:        
Payments for mining interest  (62,000)  (12,000)
Payments for collateral on reclamation bond  (67,800)  - 
Net cash used in investing activities  (129,800)  (12,000)
Net change in cash and cash equivalents  (339,749)  (230,363)
         
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD  440,316   832,426 
         
CASH AND CASH EQUIVALENTS AT END OF PERIOD $100,567  $602,063 
         
NON-CASH FINANCING AND INVESTING ACTIVITIES:        
         
Options issued for mining interest $16,044  $- 
Common stock issued for account payable  -   57,625 
         

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

Page 56 of 24

26

STAR GOLD CORP.
STATEMENTS OF CASH FLOWS (UNAUDITED)

 
 
For the three months ended 
 
 July 31, 2019 
 July 31, 2018 
CASH FLOWS FROM OPERATING ACTIVITIES:
   
   
Net loss
 $(124,451)
 $(131,079)
Adjustments to reconcile net loss to net cash used by operating activities
    
    
   Depreciation
  416 
  416 
Changes in operating assets and liabilities:
    
    
   Other current assets
  2,105 
  7 
   Other assets
  2,100 
  3,781 
   Accounts payable
  31,134 
  62,575 
Net cash used by operating activities
  (88,696)
  (64,300)
CASH FLOWS FROM INVESTING ACTIVITIES:
    
    
   Payments for mining interest
  (12,000)
  (12,000)
Net cash used in investing activities
  (12,000)
  (12,000)
   Net change in cash and cash equivalents
  (100,696)
  (76,300)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
  440,316 
  832,426 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
 $339,620 
 $756,126 
 
    
    
 
    
    


Page 6 of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2019


STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

NOTE 1 -– NATURE OF OPERATIONS


Star Gold Corp. (the “Company”) was initially incorporated as Elan Development, Inc., in the State of Nevada on December 8, 2006. The Company was originally organized to explore mineral properties in British Columbia, Canada but the Company is currently focused on gold, silver and other base metal-bearing properties in Nevada. On April 25, 2008, the name of the company was changed to Star Gold Corp.

The Company’s core business consists of assembling and/or acquiring land packages and mining claims the Company believes have potential mining reserves, and expending capital to explore these claims by drilling, and performing geophysical work or other exploration work deemed necessary to move such claims towards development and production. The business is a high-risk business as there is no guarantee that the Company’s exploration work will ultimately discover or produce any economically viable minerals.

NOTE 2 -– SIGNIFICANT ACCOUNTING POLICIES


Basis of Presentation

This summary of significant accounting policies is presented to assist in understanding the financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. The accompanying unaudited financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America for interim financial information, as well as the instructions to Form 10-Q. Accordingly, the financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

In

In the opinion of the Company’s management, all adjustments, consisting of only normal recurring adjustments, considered necessary for a fair statement of the interim financial statements have been included. The balance sheet at April 30, 2019 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. All amounts presented are in U.S. dollars. Operating results for the three monththree- and six-month period ended JulyOctober 31, 2019 are not necessarily indicative of the results that may be expected for the full fiscal year ending April 30, 2020.

For further information, refer to the financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K for the year ended April 30, 2019.

Use of Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant areas requiring the use of management assumptions and estimates relate to long-lived asset impairments and stock-based compensation valuation. Actual results could differ from these estimates and assumptions and could have a material effect on the Company’s reported financial position and results of operations.

Risks and Uncertainties

The Company’s operations are subject to significant risks and uncertainties, including financial, operational, technological and other risks associated with operating an emerging exploration mining business, including the potential risk of business failure.

Cash and Cash Equivalents

For the purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of three months or less when acquired to be cash equivalents.

Page 7 of26



Page 7 of 24
STAR GOLD CORP.
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

NOTES TO FINANCIAL STATEMENTS

JULY 31, 2019


Reclamation bond

The Reclamation bond constitutes cash held as collateral for the faithful performance of the bond securing exploration permits and are accounted for on a cost basis.

Financial Instruments

The Company’s financial instruments include cash and cash equivalents and reclamation bond. All instruments are accounted for on a cost basis, which, due to the short maturity of these financial instruments, approximates fair value at April 30, 2019.

October 31, 2019

Fair Value Measures

When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date.

At JulyOctober 31, 2019 and April 30, 2019, the Company had no assets or liabilities accounted for at fair value on a recurring or nonrecurring basis.

Mining Interests and Mineral Exploration Expenditures

Exploration costs are expensed in the period in which they occur. The Company capitalizes costs for acquiring and leasing mining properties and expenses costs to maintain mineral rights as incurred. Should a property reach the production stage, capitalized costs would be amortized using the units-of-production method on the basis of periodic estimates of ore reserves. Mining interests are periodically assessed for impairment of value, and any subsequent losses are charged to operations at the time of impairment. If a property is abandoned or sold, its capitalized costs are charged to operations.

Pre-development Expenditures

Pre-development activities involve costs incurred in the exploration stage that may ultimately benefit production, such as underground ramp development, which are expensed due to the lack of evidence of economic development, which is necessary to demonstrate future recoverability of these costs.

Equipment

Equipment is stated at cost. Significant improvements are capitalized and depreciated. Depreciation of equipment is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to seven years. Maintenance and repairs are charged to operations as incurred. Gains or losses on disposition or retirement of property and equipment are recognized in operating expenses.

Reclamation and Remediation

The Company’s operations are subject to standards for mine reclamation that have been established by various governmental agencies. In the period in which the Company incurs a contractual obligation for the retirement of tangible long-lived assets, the Company will record the fair value of an asset retirement obligation as a liability. A corresponding asset will also be recorded and depreciated over the life of the asset. After the initial measurement of an asset retirement obligation, the liability will be adjusted at the end of each reporting period to reflect changes in the estimated future cash flows underlying the obligation. To date, the Company has not incurred any contractual obligation requiring recording either a liability or associated asset.

Page 8 of26



Page 8 of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

JULY 31, 2019



Impairment of Long-lived Assets

The Company periodically reviews its long-lived assets to determine if any events or changes in circumstances have transpired which indicate that the carrying value of its assets may not be recoverable. The Company determines impairment by comparing the undiscounted net future cash flows estimated to be generated by its assets to their respective carrying amounts. If impairment is deemed to exist, the assets will be written down to fair value.

Stock-based Compensation

The Company estimates the fair value of options to purchase common stock using the Black-Scholes model, which requires the input of some subjective assumptions. These assumptions include estimating the length of time employees will retain their vested stock options before exercising them (“expected life”), the estimated volatility of the Company’s common stock price over the expected term (“volatility”), employee forfeiture rate, the risk-free interest rate and the dividend yield. Changes in the subjective assumptions can materially affect the estimate of fair value of stock-based compensation. Options granted have a ten-year maximum term and varying vesting periods as determined by the Board of Directors. The value of shares of common stock awards is determined based on the closing price of the Company’s stock on the date of the award.

Income Taxes

The Company accounts for income taxes using the liability method. The liability method requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of (i) temporary differences between financial statement carrying amounts of assets and liabilities and their basis for tax purposes and (ii) operating loss and tax credit carryforwards for tax purposes. Deferred tax assets are reduced by a valuation allowance when management concludes that it is more likely than not that a portion of the deferred tax assets will not be realized in a future period.

Reclassifications

Certain reclassifications have been made to the prior year2018 financial statements in order to compareconform to the current year financial statement2019 presentation. These reclassifications have no effect on net loss, total assets or accumulated deficit as previously reported.

New Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02 Leases (Topic 842). The update modifies the classification criteria and requires lessees to recognize the assets and liabilities on the balance sheet for most leases. The update is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. Adoption of this update on May 1, 2019 had no impact on the Company’s financial statement.

In June 2018, the FASB issued ASU No. 2018-07, Compensation-Stock Compensation, Improvements to Nonemployee Share-Based Payment Accounting. ASU No. 2018-07 expands the scope of the standard for stock-based compensation to include share-based payment transactions for acquiring goods and services from nonemployees. ASU No. 2018-07 became effective for the Company on May 1, 2019. Adoption of this update on May 1, 2019 had no impact on the Company’s financial statement.

Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

NOTE 3–3 – EARNINGS PER SHARE

Basic Earnings Per Share (“EPS”) is computed as net income (loss) available to common stockholders divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options and warrants.

Page 9 of26




Page 9 of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2019


STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

The outstanding securities at JulyOctober 31, 2019 and 2018 that could have a dilutive effect are as follows:

 
 July 31, 2019 
 July 31, 2018 
Stock options
  6,645,000 
  6,650,000 
Warrants
  29,039,849 
  30,654,249 
  TOTAL POSSIBLE DILUTIVE SHARES
  35,684,849 
  37,304,249 
 
    
    

  October 31, 2019  October 31, 2018 
Stock options  7,145,000   6,650,000 
Warrants  29,039,849   30,654,249 
TOTAL POSSIBLE DILUTIVE SHARES  36,184,849   37,304,249 
         

For the three and six months ended JulyOctober 31, 2019 and 2018, respectively, the effect of the Company’s outstanding stock options and warrants would have been anti-dilutive and so are excluded in the diluted EPS.

NOTE 4–4 – EQUIPMENT AND MINING INTEREST

The following is a summary of the Company’s equipment and mining interest at JulyOctober 31, 2019 and April 30, 2019:

 
 July 31, 2019 
 April 30, 2019 
Equipment
 $4,995 
 $32,002 
  Less accumulated depreciation
  (2,428)
  (29,019)
Equipment, net of accumulated depreciation
  2,567 
  2,983 
Mining interest - Longstreet
  476,124 
  464,124 
  TOTAL EQUIPMENT AND MINING INTEREST
 $478,691 
 $467,107 

  October 31, 2019  April 30, 2019 
Equipment $4,995  $32,002 
Less accumulated depreciation  (2,845)  (29,019)
Equipment, net of accumulated depreciation  2,150   2,983 
Mining interest - Longstreet  542,168   464,124 
TOTAL EQUIPMENT AND MINING INTEREST $544,318  $467,107 
         

Pursuant to the Longstreet Property Option Agreement with Great Basin Resources, Inc. (“Great Basin”), as amended, (the “Longstreet Agreement”)which was originally entered into by the Company on or about January 15, 2010 (the “Longstreet Agreement”), the Company leases, with an option to acquire, unpatented mining claims located in the State of Nevada known as the Longstreet Property. Under the agreement,Through August 12, 2019, the Company iswas required to make minimal lease payments in the form of cash and options to purchase shares of the Company’s common stock.

On December 4, 2018, the Company amended the Longstreet Agreement to change the due date of certain expenditures required by that agreement (the “2018 Amendment”). The 2018 Amendment extendsextended the due date of the 2019 expenditures from January 16, 2019 to August 31, 2019 and also extendsextended the due date of the 2020 expenditures from January 16, 2020 to August 31, 2020. No other provisions of the Longstreet Agreement, as previously amended, were affected by the 2018 Amendment.

On August 12, 2019, the Company and Great Basin agreed to amend the Longstreet Agreement (the “2019 Amendment”) to eliminate the required property expenditure structure and to implement new consideration for the transfer of the Property pursuant to that agreement. The 2019 Amendment eliminated the remainder of the required property expenditures. The 2019 Amendment sets forth Great Basin to transfer title, to the Company, of the mining interest upon the Company:

a)adjusting the exercise price to $0.04 on 435,000 existing options to purchase Company common stock from exercise prices ranging from $0.05-$0.08 per share;
b)issuing an additional 500,000 options to purchase Company common stock at the exercise price of $0.04;
c)making a cash payment of $50,000 to Great Basin (paid on August 19, 2019) and
d)entering into a consulting agreement with Great Basin with a term of eighteen (18) months.

On August 12, 2019, the Company repriced 435,000 existing options to purchase the Company’s common stock to an exercise price of $0.04 and issued an additional 500,000 options to purchase the Company’s common stock at an exercise price of $0.04. The fair value of the re-pricing and issuance of additional stock options was $16,044 which was capitalized as “Mining Interest”.

Page 10 of26

STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

On September 1, 2019, the Company executed a consulting agreement with Great Basin for a term of eighteen (18) months (the (“Consulting Agreement”). Under the Consulting Agreement, the Company will pay Great Basin $7,500 per month for the term of the Consulting Agreement.

The 2019 Amendment also grants the Company the option, to be exercised no later than six (6) months following the first receipt of proceeds from the sale of ore from the mining interest, to purchase one-half of Great Basin’s 3.0% Net Smelter Royalty, on the Longstreet Project, for a payment of $1,750,000.

No other provisions of the Longstreet Agreement, as previously amended, were affected by the 2019 Amendment.

In addition, the Company is obligated, pursuant to the Longstreet Agreement, to pay an annual advance royalty payment of $12,000 related to the Clifford claims. The Longstreet Agreement obligatesFor the Company to minimal expenditures to be spent on the Longstreet Property. All allowable expenditures in excess of the required annual expenditures are carried over to the subsequent year.

During each of the three-month periodssix months ended April 30,October 31, 2019 and 2018, respectively, the Company paid the annual $12,000 advance royalty for the Clifford claims.
The schedules of future minimum required expenditures, annual payments, and number of stock options to be issued pursuant toadditional mining interest on the Longstreet Agreement are as follows:

Required expenditure
January 17, 2018 through August 31, 2019
$500,000
September 1, 2019 through August 31, 2020
700,000
  TOTAL
$1,200,000

 
 Cash payment (1) 
 Stock options 
January 16, 2020
 $45,000 
  50,000 
Payment due upon transfer but no later than January 16, 2021
  85,000 
  - 
  TOTAL
 $130,000 
  50,000 
 
    
    
(1)
Does not include $12,000 annual advance royalty payment related to Clifford claims.
As of July 31,Property.

On September 20, 2019, the Company was in compliance withpaid $67,800 to the expenditure provisions ofUnited States Forest Service to increase the Reclamation Bond as collateral on the Longstreet Agreement, as amended.



Page 10Property. The bond is collateral on reclamation of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2019

On August 12, 2019, the Company amended the Longstreet Agreement to eliminate the required property expenditure structure and to implement new consideration for the transfer ofplanned drilling activities on the Longstreet Property pursuantand is refundable subject to that Agreement (Note 10).
the Company completing defined reclamation actions upon completion of drilling.

NOTE 5 –OTHER– OTHER ASSETS

On January 19, 2017, the Company entered into an Option and Lease of Water Rights with Stone Cabin Company, LLC (the “Stone Cabin Water Rights Agreement”). In exchange for a one-time payment of $20,000, the Stone Cabin Water Rights Agreement granted the Company a three-year option to commence a ten-year lease of certain water rights in Nevada. The water rights are for use in conjunction with the Company’s Longstreet Project. Lease payments for the water rights do not commence unless the Company exercises the option to lease. The Stone Cabin Water Rights Agreement also granted the Company the ability to extend, upon additional option payments, the option to lease for up to an additional three years and the ability to extend the water rights lease (if exercised) for an additional ten-year period. The $20,000 payment was deferred as Other Assets and is being amortized on a straight-line basis over the three-year option period.

On August 21, 2017, the Company entered into an Option and Lease of Water Rights, with High Test Hay, LLC (the “High Test Water Rights Agreement”). In exchange for a one-time payment of $25,000, the High Test Water Rights Agreement grants the Company a three-year option to commence a ten-year lease on certain water rights in Nevada. The water rights are for use in conjunction with the Company’s Longstreet Project. Lease payments for the water rights do not commence unless and until the Company exercises the option to lease. The High Test Water Rights Agreement also grants the Company the ability to extend, upon additional option payments, the option to lease for up to an additional three years and the ability to extend the water rights lease (if exercised) for up to an additional twenty years. The $25,000 payment has been deferred and is being amortized on a straight-line basis over the three-year option period.

The following is a summary of the Company’s Other Assets at JulyOctober 31, 2019 and April 30, 2019.

 
 July 31, 2019 
 April 30, 2019 
Option on water rights lease agreements, net
 $11,954 
 $15,735 
Prepaid insurance and other expenses
  9,243 
  9,667 
  Total
  21,197 
  25,402 
Less Other Assets - Current
  (20,740)
  (22,845)
  TOTAL OTHER ASSETS - NON-CURRENT
 $457 
 $2,557 

  October 31, 2019  April 30, 2019 
Option on water rights lease agreements, net $8,174  $15,735 
Prepaid insurance and other expenses  8,814   9,667 
Total  16,988   25,402 
Less Other Assets - Current  (16,988)  (22,845)
TOTAL OTHER ASSETS - NON-CURRENT $-  $2,557 
         

NOTE 6–6 – RELATED PARTY TRANSACTIONS

The Company rented office space from Marlin Property Management, LLC (“Marlin”) an entity owned by the spouse of the Company’s former President and current Chairman of the Board of Directors. The lease was on a month-to-month basis as financial resources were available. The Company terminated the lease effective November 1, 2018. For the three and six months ended JulyOctober 31, 2019 and 2018, office rent was $Nil$750 and $750,$1,500, respectively. No rent was incurred under this agreement in the three and six months ended October 31, 2019.

Page 11 of26

STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

During the three and six months ended April 30,October 31, 2019, the Company paid a member of the Company’s Board of Directors (the “Board”) for consulting and investor relation services in the amount of $4,000.$4,000 and $8,000, respectively. There was no payment for services during the three and six months ended October 31, 2018.

Effective September 1, 2019, the Board authorized the Company to enter into separate consulting agreements with the Chairman of the Board, two respective members of the Board and the Company’s Chief Financial Officer to reward, compensate and incentivize. The Company will accrue an aggregate $18,000 per month in consulting and management fees and, in the event of a change of control or sale of substantially all of the Company’s assets, these members of Company management shall collectively be granted bonuses equal to an aggregate two per cent (2%) of the value of the change of control or sale.

During the three and six months ended October 31, 2019, the Company incurred management fees of $4,000 and $26,000, respectively, for certain members of the Company’s board of directors. The balance of $26,000 is included in “Accounts payable and accrued liabilities” at JulyOctober 31, 2019. There was no payment for such services during the three and six months ended April 30,October 31, 2018.

NOTE 7 – STOCKHOLDERS’ EQUITY

On October 26, 2018, the Company issued 960,417 shares of its common stock in lieu of cash payment for accounts payable. The value of the shares issued was $57,625, based on a price of $0.06 per share which was the fair value on the date of issuance.

No shares of common stock have been issued during the six months ended October 31, 2019.

NOTE 8 – WARRANTS

The following is a summary of activity for warrants to purchase shares of the Company’s stock through April 30,October 31, 2019.



Page 11 of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2019

 
 Warrants 
 Weighted average exercise price 
Balance outstanding at April 30, 2018 and April 30, 2019
  30,654,249 
 $0.16 
  Expired
  (1,614,400)
  (0.23)
Balance outstanding at July 31, 2019
  29,039,849 
 $0.16 
 
    
    

     Weighted average exercise 
  Warrants  price 
Balance outstanding at April 30, 2018 and April 30, 2019  30,654,249  $0.16 
Expired  (1,614,400)  (0.23)
Balance outstanding at October 31, 2019  29,039,849  $0.16 
         

There were no warrants to purchase shares of the Company’s common stock issued or exercised during the three months ended JulyOctober 31, 2019 and 2018, respectively.

The composition of the Company’s warrants outstanding at April 30,October 31, 2019 is as follows:

Issue Date Expiration Date Warrants  Exercise Price  Remaining life (years) 
October 12, 2015 October 12, 2020  4,241,000  $0.20   0.95 
October 12, 2016 October 12, 2021  14,000,000   0.15   1.95 
October 31, 2017 October 31, 2020  10,798,849   0.15   1.00 
     29,039,849  $0.16   1.45 

Page 12 of26

Issue DateExpiration Date
 Warrants 
 Exercise Price 
 Remaining life (years) 
October 12, 2015October 12, 2020
  4,241,000 
 $0.20 
  1.20 
October 12, 2016October 12, 2021
  14,000,000 
  0.15 
  2.20 
October 31, 2017October 31, 2020
  10,798,849 
  0.15 
  1.25 
 
  29,039,849 
 $0.16 
  1.70 
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

NOTE 9 -– STOCK OPTIONS

Options issued for mining interest

In consideration for its mining interest (see Note 4), the Company iswas obligated to issue stock options to purchase shares of the Company’s common stock based on "fair“fair market price"price” which for financial statement purposes is considered to be the closing price of the Company'sCompany’s common stock on the issue dates. Those costs are capitalized as Mining Interest (Note 4). No

For the three and six months ended October 31, 2019, there were 500,000 options were issued for mineral interests duringmining interest at the exercise price of $0.04 per share. During the three and six months ended JulyOctober 31, 2019, the Company repriced 435,000 existing options to purchase Company common stock, to the exercise price of $0.04 per share, from exercise prices ranging from $0.05 to $0.80. The fair value of the issuance and 2018.

repricing was $16,044.

For the three and six months ended October 31, 2018, there were no options issued for mining interest.

Options outstanding for mining interest totaled 435,000 at both April 30, 2019 and July935,000 options at October 31, 2019 and are fully vested. As of JulyOctober 31, 2019, the remaining weighted average term of the option grants for mining interest was 4.164.84 years. As of JulyOctober 31, 2019, the weighted average exercise price of the option grants for mining interest was $0.26$0.04 per share.

Options issued under the 2011 Stock Option/Restricted Stock Plan

The Company established the 2011 Stock Option/Restricted Stock Plan. The Stock Option Plan is administered by the Board of Directors and provides for the grant of stock options to eligible individualsindividual including directors, executive officers and advisors that have furnished bona fide services to the Company not related to the sale of securities in a capital-raising transaction.

The Stock Option Plan has a fixed maximum percentage of 10% of the Company’s outstanding shares that are eligible for the plan pool, whereby the number of Shares under the plan increases automatically increases as the total number of shares outstanding increase. The number of shares subject to the Stock Option Plan and any outstanding awards will be adjusted appropriately by the Board of Directors if the Company’s common stock is affected through a reorganization, merger, consolidation, recapitalization, restructuring, reclassification dividend (other than quarterly cash dividends) or other distribution, stock split, spin-off or sale of substantially all of the Company’s assets.

The Stock Option plan also has terms and conditions, including without limitations that the exercise price for stock options granted under the Stock Option Plan must equal the stock’s fair value, based on the closing price per share of common stock, at the time the stock option is granted. The fair value of each option award is estimated on the date of grant utilizing the Black-Scholes model and commonly utilized assumptions associated with the Black-Scholes methodology. Options granted under the Plan have a ten-year maximum term and varying vesting periods as determined by the Board.

The total value of stock option awards is expensed ratably over the vesting period of the employees receiving the awards. As of JulyOctober 31, 2019 and 2018, respectively, there was no unrecognized compensation cost related to stock-based options and awards. No options were issued under the 2011 Plan during the three and six months ended JulyOctober 31, 2019 and 2018, respectively.

Page 13 of26



Page 12 of 24
STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2019


STAR GOLD CORP.
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2019

The following table summarizes additional information about the options under the Company’s Stock Option Plan as of JulyOctober 31, 2019:

 
 Options outstanding and exercisable 
Date of Grant
 Shares 
 Price 
 Remaining Term 
October 18, 2016
  4,810,000 
 $0.06 
  2.22 
April 30, 2018
  1,400,000 
  0.065 
  3.75 
  Total options
  6,210,000 
 $0.06 
  2.67 
 
    
    
    

  Options outstanding and exercisable 
Date of Grant Shares  Price  Remaining Term 
October 18, 2016  4,810,000  $0.06   1.97 
April 30, 2018  1,400,000   0.065   3.50 
Total options  6,210,000  $0.06   2.31 
             

The total value of stock option awards is expensed ratably over the vesting period of the employees receiving the awards. As of April 30,October 31, 2019, there was no unrecognized compensation cost related to stock-based options and awards.

Summary:

The following is a summary of the Company’s stock options outstanding and exercisable:

Options issued for:Expiration Date
 Options 
 Weighted Average
Exercise Price 
Mining interestsApril 11, 2020 to January 15, 2029
  435,000 
 $0.26 
Stock option planOctober 18, 2021 to April 30, 2023
  6,210,000 
  0.06 
  Outstanding and exercisable at April 30, 2019 
  6,645,000 
 $0.07 

       Weighted Average 
Options issued for: Expiration Date Options  Exercise Price 
Mining interests April 11, 2020 to January 15, 2029  935,000  $0.04 
Stock option plan October 18, 2021 to April 30, 2023  6,210,000   0.06 
Outstanding and exercisable at October 31, 2019    7,145,000  $0.06 
           

The aggregate intrinsic value of all options vested and exercisable at JulyOctober 31, 2019, was $Nil based on the Company’s closing price of $0.045$0.03 per common share at JulyOctober 31, 2019. The Company’s current policy is to issue new shares to satisfy option exercises.

Page 14 of26

NOTE 10 – SUBSEQUENT EVENTS
ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION.

On August 12, 2019, the Company and Great Basin Resources, Inc. (“Great Basin”) agreed to amend the Longstreet Agreement (Note 4) to eliminate the required property expenditure structure and to implement new consideration for the transfer of the Property pursuant to that agreement (the “2019 Amendment”). The Amendment eliminated the remainder of the required property expenditures set forth in the Longstreet Agreement, as amended. Furthermore, the Amendment sets forth that upon the Company: a) repricing 435,000 existing options to purchase Company common stock at the exercise price of $0.04; b) issuing an additional 500,000 options to purchase Company common stock at the exercise price of $0.04; c) making a cash payment of $50,000 to Great Basin (paid on August 19 2019) and d) entering into a consulting agreement with Great Basin with a term of eighteen months, Great Basin shall transfer title to the Property to the Company.

The Amendment also grants the Company the option, to be exercised no later than six (6) months following the first receipt of proceeds from the sale of ore from the Property, to purchase one-half of Great Basin’s 3.0% Net Smelter Royalty for a payment of $1,750,000.
No other provisions of the Longstreet Agreement, as previously amended, were affected by the Amendment.
Page 13 of 24
ITEM 2. 
MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report and the exhibits attached hereto contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements concern the Company’s anticipated results and developments in the Company’s operations in future periods, planned exploration and development of its properties, plans related to its business and other matters that may occur in the future. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

Any statement that expresses or involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates”, or “intends”, or states that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation:

●
Risks related to the Company’s properties being in the exploration stage;
●
Risks related to the mineral operations being subject to government regulation;
●
Risks related to environmental concerns;
●
Risks related to the Company’s ability to obtain additional capital to develop the Company’s resources, if any;
●
Risks related to mineral exploration and development activities;
●
Risks related to mineral estimates;
●
Risks related to the Company’s insurance coverage for operating risks;
●
Risks related to the fluctuation of prices for precious and base metals, such as gold, silver and copper;
●
Risks related to the competitive industry of mineral exploration;
●
Risks related to the title and rights in the Company’s mineral properties;
●
Risks related to the possible dilution of the Company’s common stock from additional financing activities;
●
Risks related to potential conflicts of interest with the Company’s management;
●
Risks related to the Company’s shares of common stock;

●Risks related to the Company’s properties being in the exploration stage;
●Risks related to the mineral operations being subject to government regulation;
●Risks related to environmental concerns;
●Risks related to the Company’s ability to obtain additional capital to develop the Company’s resources, if any;
●Risks related to mineral exploration and development activities;
●Risks related to mineral estimates;
●Risks related to the Company’s insurance coverage for operating risks;
●Risks related to the fluctuation of prices for precious and base metals, such as gold, silver and copper;
●Risks related to the competitive industry of mineral exploration;
●Risks related to the title and rights in the Company’s mineral properties;
●Risks related to the possible dilution of the Company’s common stock from additional financing activities;
●Risks related to potential conflicts of interest with the Company’s management;
●Risks related to the Company’s shares of common stock;

This list is not exhaustive of the factors that may affect the Company’s forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further under the sections titled “Risk Factors and Uncertainties”, “Description of Business” and “Management’s Discussion and Analysis” of this Quarterly Report. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated or expected. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Star Gold Corp. disclaims any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as required by law. The Company advises readers to carefully review the reports and documents filed from time to time with the Securities and Exchange Commission (the “SEC”), particularly the Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Star Gold Corp qualifies all forward-looking statements contained in this Quarterly Report by the foregoing cautionary statement.

Certain statements contained in this Quarterly Report on Form 10-Q constitute “forward-looking statements.” These statements, identified by words such as “plan,” “anticipate,” “believe,” “estimate,” “should,” “expect,” and similar expressions include the Company’s expectations and objectives regarding its future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption “Management’s Discussion and Analysis or Plan of Operation” and elsewhere in this Quarterly Report.

Page 15 of26

As used in this Quarterly Report, the terms “we,” “us,” “our,” “Star Gold,” and the “Company”, mean Star Gold Corp., unless otherwise indicated. All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated.

Page 14 of 24
Management’s Discussion and Analysis is intended to be read in conjunction with the Company’s financial statements and the integral notes (“Notes”) thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ending April 30, 2019. The following statements may be forward-looking in nature and actual results may differ materially.

Corporate Background

The Company was originally incorporated on December 8, 2006, under the laws of the State of Nevada as Elan Development, Inc. On April 25, 2008, the name of the company was changed to Star Gold Corp. Star Gold Corp. is an exploration stage company engaged in the acquisition and exploration of precious metal deposit properties and advancing them toward production. The Company is engaged in the business of exploring, evaluating and acquiring mineral prospects with the potential for economic deposits of precious and base metals.

Star Gold Corp. currently leases with an option to acquire certain unpatented mining claims located in the State of Nevada which in part make up what we refer to as the “Longstreet Property” (or the “Longstreet Project”). The Longstreet Property in its entirety comprises 125142 mineral claims: 75 original optioned claims, of which 70 are unpatented staked claims and five claims leased from local ranchers, pursuant to the “Clifford Lease”; as well as 5067 claims subsequently staked by Star Gold. The Longstreet Property covers a total area of approximately 2,500 acres (1,012 ha). The Longstreet Project is at an intermediate stage of exploration.

The Company has no patents, licenses, franchises or concessions which are considered by the Company to be of importance. The business is not of a seasonal nature. Because minerals are traded in the open market, the Company has little to no control over the competitive conditions in the industry.

Overview of Mineral Exploration and Current Operations

Star Gold Corp. is an exploration stage mineral company with no producing mines. Mineral exploration is essentially a research activity that does not produce a product. The Company acquires properties which it believes have potential to host economic concentrations of minerals, particularly gold and silver. These acquisitions have and may take the form of unpatented mining claims on federal land, or leasing claims, or private property owned by others. An unpatented mining claim is an interest, that can be acquired, in the mineral rights on open lands of the federally owned public domain. Claims are staked in accordance with the Mining Law of 1872, recorded with the federal government pursuant to laws and regulations established by the Bureau of Land Management. The Company intends to remain in the business of exploring for mining properties that have the potential to produce gold, silver, base metals and other commodities.

The Company will perform basic geological work to identify specific drill targets on the properties, and then collect subsurface samples by drilling to confirm the presence of mineralization (the presence of economic minerals in a specific area or geological formation). The Company may enter joint venture agreements with other companies to fund further exploration and/or development work. It is the Company’s plan to focus on assembling a high-quality group of mid-stage mineral (primarily gold and silver) exploration prospects, using the experience and contacts of the management group. By such prospects, the Company means properties that have been previously identified by third parties, (including prior owners and/or exploration companies), as containing mineral deposits with potential for economic mineralization. Often these properties have been sampled, mapped and sometimes drilled, usually with indefinite results. Accordingly, such acquired projects will have prior exploration history and/or will have strong similarity to a recognized geologic ore deposit model. Geographic emphasis will be place on the western United States.

The geologic potential and ore deposit models have been defined and specific drill targets identified the Company’s sole remaining property. The Company’s property evaluation process involves using basic geologic fieldwork to perform an initial evaluation of a property. If the evaluation is positive, the Company seeks to acquire, either by staking unpatented mining claims on open public domain, or by leasing the property from the owner of private property or the owner of unpatented claims. Once acquired, the Company then typically makes a more detailed evaluation of the property. This detailed evaluation involves expenditures for exploration work which may include rock and soil sampling, geologic mapping, geophysics, trenching, drilling or other means to determine if economic mineralization is present on a property.

Page 16 of26

Page 15 of 24

Portions of the Company’s mining properties are owned by third parties and leased to Star Gold as outlined in the following table:

Property name Longstreet
Third parties Great Basin Resources, Inc. and
Third partiesClifford
Number of claims 
142(1)
Acres (approx.) 2,500
Agreements/Royalties  
Royalties 3% Net Smelter Royalty (“NSR”)
Annual lease payments – total due through 2020$130,000
Minimum exploration expenditures – total due through 2020$1,200,000
Stock options – total due through 202050,000
Annual advance royalty payment $12,000
(1)
Great Basin Resources, Inc. (“Great Basin”) took assignment from MinQuest, Inc., of the 142 claims which are leased to the Company under the Longstreet Agreement (which was also assigned to Great Basin) (Note 4 of the financial statements contained in Item 8) and Clifford owns 5 claims (also Note 4) which are managed by the Company.
(2)
On August 12, 2019, the Company and Great Basin Resources, Inc. (“Great Basin”) agreed to amend the Longstreet Agreement (Note 4) to eliminate the required property expenditure structure and to implement new consideration for the transfer of the Property pursuant to that agreement (the “2019 Amendment”). The Amendment eliminated the remainder of the required property expenditures set forth in the Longstreet Agreement, as amended.
(1)Great Basin Resources, Inc. (“Great Basin”) took assignment from MinQuest, Inc., of the 142 claims which are leased to the Company under the Longstreet Agreement (which was also assigned to Great Basin) (Note 4 of the financial statements contained in Item 8) and Clifford owns 5 claims (also Note 4) which are managed by the Company.

(2)On August 12, 2019, the Company and Great Basin Resources, Inc. (“Great Basin”) agreed to amend the Longstreet Agreement (Note 4) to eliminate the required property expenditure structure and to implement new consideration for the transfer of the Property pursuant to that agreement (the “2019 Amendment”). The Amendment eliminated the remainder of the required property expenditures set forth in the Longstreet Agreement, as amended.

Compliance with Government Regulations

Continuing to acquire and explore mineral properties in the State of Nevada will require the Company to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the exploration of minerals in the State of Nevada and the United States Federal agencies.

United States

Mining in the State of Nevada is subject to federal, state and local law. Three types of laws are of particular importance to the Company’s U.S. mineral properties: those affecting land ownership and mining rights; those regulating mining operations; and those dealing with the environment.

Land Ownership and Mining Rights.

On Federal Lands, mining rights are governed by the General Mining Law of 1872 (General Mining Law) as amended, 30 U.S.C. §§ 21-161 (various sections), which allows the location of mining claims on certain Federal Lands upon the discovery of a valuable mineral deposit and proper compliance with claim location requirements. A valid mining claim provides the holder with the right to conduct mining operations for the removal of locatable minerals, subject to compliance with the General Mining Law and Nevada state law governing the staking and registration of mining claims, as well as compliance with various federal, state and local operating and environmental laws, regulations and ordinances. As the owner or lessee of the unpatented mining claims, the Company has the right to conduct mining operations on the lands subject to the prior procurement of required operating permits and approvals, compliance with the terms and conditions of any applicable mining lease, and compliance with applicable federal, state, and local laws, regulations and ordinances.

Mining Operations

The exploration of mining properties and development and operation of mines is governed by both federal and state laws.

The State of Nevada likewise requires various permits and approvals before mining operations can begin, although the state and federal regulatory agencies usually cooperate to minimize duplication of permitting efforts. Among other things, a detailed reclamation plan must be prepared and approved, with bonding in the amount of projected reclamation costs. The bond is used to ensure that proper reclamation takes place, and the bond will not be released until that time. The Nevada Department of Environmental Protection, which is referred to as the NDEP, is the state agency that administers the reclamation permits, mine permits and related closure plans on the Nevada property. Local jurisdictions (such as Eureka County) may also impose permitting requirements (such as conditional use permits or zoning approvals).

Page 17 of26

Page 16 of 24

Environmental Law

The development, operation, closure, and reclamation of mining projects in the United States requires numerous notifications, permits, authorizations, and public agency decisions. Compliance with environmental and related laws and regulations requires us to obtain permits issued by regulatory agencies, and to file various reports and keep records of the Company’s operations. Certain of these permits require periodic renewal or review of their conditions and may be subject to a public review process during which opposition to the Company’s proposed operations may be encountered. The Company is currently operating under various permits for activities connected to mineral exploration, reclamation, and environmental considerations. Unless and until a mineral resource is proved, it is unlikely Star Gold Corp. operations will move beyond the exploration stage. If in the future the Company decides to proceed beyond exploration, there will be numerous notifications, permit applications, and other decisions to be addressed at that time.

Competition

Star Gold Corp. competes with other mineral resource exploration and development companies for financing and for the acquisition of new mineral properties and for equipment and labor related to exploration and development of mineral properties. Many of the mineral resource exploration and development companies with whom the Company competes have greater financial and technical resources. Accordingly, competitors may be able to spend greater amounts on acquisitions of mineral properties of merit, on exploration of their mineral properties and on development of their mineral properties. In addition, they may be able to afford greater geological expertise in the targeting and exploration of mineral properties. This competition could result in competitors having mineral properties of greater quality and interest to prospective investors who may finance additional exploration and development. This competition could adversely impact Star Gold Corp.’s ability to finance further exploration and to achieve the financing necessary for the Company to develop its mineral properties.

The Company provides no assurance it will be able to compete in any of its business areas effectively with current or future competitors or that the competitive pressures faced by the Company will not have a material adverse effect on the business, financial condition and operating results.

Office and Other Facilities

Star Gold Corp. currently maintains its administrative offices at 1875 Lakewood Drive,, Suite 200,, Coeur d’Alene, ID 83814. The telephone number is (208) 664-5066. Star Gold Corp. does not currently own title to any real property.

Employees

Employees

The Company has no employees as of the date of this Quarterly Report on Form 10-Q. Star Gold Corp. conducts business largely through independent contractor agreements with consultants.

Research and Development Expenditures

The Company has not incurred any research expenditures since incorporation

Reports to Security Holders

The Registrant does not issue annual or quarterly reports to security holders other than the annual Form 10-K and quarterly Forms 10-Q as electronically filed with the SEC.SEC, all of which are available on the Company’s website at www.stargoldcorp.com. Electronically filed reports may also be accessed atwww.sec.gov. Interested parties also may read and copy any materials filed with the SEC at the SEC’s Public Reference Room at 450 Fifth Street NW, Washington, DC 20549. Information may be obtained on the operation of the Public Reference Room by calling the SEC at (800) SEC-0330.

PLAN OF OPERATION

The Company maintains a corporate office in Coeur d’Alene, Idaho. This is the primary administrative office for the Company and is utilized by Board Chairman Lindsay Gorrill and Chief Financial Officer Kelly Stopher.

During the year ended April 30, 2019, the Company completed the following:

Wildlife and Biological Baseline Study (WBS)

Cultural and Archeology Study

Plan of Operation submitted to US Forestry Service.

Page 18 of26

Page 17 of 24

For the upcoming fiscal year ending April 30, 2020, the Company plans to commence the following activities as it prepares the EIS on the Longstreet Project:

Hydrology Study (in progress – dependent on Plan of Operations being approved)

Geochemical analysis – design of program for submission to State of Nevada (in progress)

Plan of Operations Development (Mine Plan, Civil Engineering Designs)

Assuming the results of the above-referenced studies are favorable, the Company intends to proceed to the preparation of an EIS and plan of operation for the Longstreet Project (the “Plan of Operations”). The eventual objectives of the EIS and the Plan of Operations are the issuance, by each responsible agency, of the necessary permits to authorize the construction of, and ongoing operations at, an open pit/heap leach mine at the Longstreet Property.

The Company anticipates the aforementioned tasks to be completed in late 2019,early 2020, with the EIS prepared in 2020.

late 2020 and early 2021.

Approval of the Longstreet Plan is subject to governmental agency review and may require additional remediation activities.

Management believes it can source additional capital in the investment markets in the coming months and years. The Company may also consider other sources of funding, including potential mergers, joint ventures and/or farm-out a portion of its exploration properties.

Future liquidity and capital requirements depend on many factors including timing, cost and progress of the Company’s exploration efforts. The Company will consider additional public offerings, private placement, mergers or debt instruments.

Additional financing will be required in the future to complete all necessary steps to apply for a final permit. Although the Company believes it will be able to source additional financing there are no guarantees any needed financing will be available at the time needed or on acceptable terms, if at all. If the Company is unable to raise additional financing when necessary, it may have to delay exploration efforts or property acquisitions or be forced to cease operations. Collaborative arrangements may require the Company to relinquish rights to certain of its mining claims.

RESULTS OF OPERATIONS            
  For the three months ended October 31,       
  2019  2018  $ Change  % Change
             
Mineral exploration expense $-  $(4,714) $4,714   (100.0%)
Pre-development expense  28,690   45,766   (17,076)  (37.3%)
Legal and professional fees  19,462   5,357   14,105   263.3%
Management and administrative  61,518   38,490   23,028   59.8%
Depreciation  416   416   -   0.0%
Interest expense  233   200   33   16.5%
Interest (income)  (230)  (591)  361   (61.1%)
NET LOSS $110,089  $84,924  $25,165   29.6%
                 
  For the six months ended October 31,       
  2019  2018  $ Change  % Change
             
Mineral exploration expense $26,630  $19,914  $6,716   33.7%
Pre-development expense  57,763   90,812   (33,049)  (36.4%)
Legal and professional fees  59,722   35,252   24,470   69.4%
Management and administrative  89,861   69,942   19,919   28.5%
Depreciation  832   832   -   N/A 
Interest expense  448   400   48   12.0%
Interest (income)  (716)  (1,149)  433   (37.7%)
NET LOSS $234,540  $216,003  $18,537   8.6%

Page 19 of26

RESULTS OF OPERATIONS
 
 For the three months ended July 31, 
   
   
 
 2019 
 2018 
 $ Change 
 % Change 
Mineral exploration expense
 $26,630 
 $24,628 
 $2,002 
  8.1%
Pre-development expense
  29,073 
  45,046 
  (15,973)
  (35.5%)
Legal and professional fees
  40,260 
  29,895 
  10,365 
  34.7%
Management and administrative
  28,343 
  31,452 
  (3,109)
  (9.9%)
Depreciation
  416 
  416 
  - 
  N/A 
Interest expense
  215 
  200 
  15 
  7.5%
Interest (income)
  (486)
  (558)
  72 
  (12.9%)
   NET LOSS
 $124,451 
 $131,079 
 $(6,628)
  (5.1%)

The Company earned no operating revenue in 2019 or 2018 and does not anticipate earning any operating revenues in the near future. Star Gold Corp. is an exploration stage company and presently is seeking other natural resources related business opportunities.

The Company will continue to focus its capital and resources toward permitting activities at its Longstreet Property.

Total net loss for the three months ended JulyOctober 31, 2019 of $124,451 decreased$110,089 increased by $6,628$25,165 from 2018 total net loss of $131,079.

$84,924.

Total net loss for the six months ended October 31, 2019 of $234,540 increased by $18,537 from 2018 total net loss of $216,003.

Mineral exploration and consultants’ expense

 
 For the three months ended July 31, 
   
   
 
 2019 
 2018 
 $ Change 
 % Change 
Drilling and field work
 $1,386 
 $804 
 $582 
  72.4%
Claims
  25,244 
  23,824 
  1,420 
  6.0%
   Total mineral exploration and consultants’ expense
 $26,630 
 $24,628 
 $2,002 
  8.1%
Page 18 of 24

Mineral exploration

  For the three months ended October 31,       
  2019  2018  $ Change  % Change
Drilling and field work $-  $(4,714) $4,714   (100.0%)
Claims  -   -   -   N/A 
Total mineral exploration and consultants’ expense $-  $(4,714) $4,714   (100.0%)
                 
  For the six months ended October 31,       
  2019  2018  $ Change  % Change
Drilling and field work $1,386  $(3,910) $5,296   (135.4%)
Claims  25,244   23,824   1,420   6.0%
Total mineral exploration and consultants’ expense $26,630  $19,914  $6,716   33.7%

Exploration and consultants’ expense for the three months ended JulyOctober 31, 2019 was $Nil compared to a credit of $4,714 in 2018. During the three months ended October 31, 2018, the Company received a refund of a reclamation bond for $5,479 which had previously been expensed resulting in the net credit amount.

For the six months ended October 31, 2019, exploration and consultants’ expense was $26,630, an increase of $2,002$6,716 from the prior period ended October 31, 2018 mineral exploration and consultants’ expense of $24,628. ($19,914).

The Company’s emphasis has shifted from exploratory drilling to activities related to pre-development expense including environmental and anthropological studies associated with building a Plan of Operations and obtaining a permit for construct a mine at the Longstreet site.

Page 20 of26


Pre-development expense

 
 For the three months ended July 31, 
   
   
 
 2019 
 2018 
 $ Change 
 % Change 
Flora and fauna contractor
 $8,060 
 $8,837 
 $(777)
  (8.8%)
Environmental impact and plan of operations
  11,857 
  12,013 
  (156)
  (1.3%)
Project management
  5,375 
  20,415 
  (15,040)
  (73.7%)
Water rights costs
  3,781 
  3,781 
  - 
  0.0%
Aerial mapping
  - 
  - 
  - 
  N/A 
   Total pre-development expense
 $29,073 
 $45,046 
 $(15,973)
  (35.5%)
 
    
    
    
    

  For the three months ended October 31,       
  2019  2018  $ Change  % Change
Cultural resources and anthropological $-  $1,096  $(1,096)  (100.0%)
Environmental impact and plan of operations  9,909   21,057   (11,148)  -52.9%
Project management  -   19,832   (19,832)  (100.0%)
Water rights costs  3,781   3,781   -   0.0%
Technical consultants  15,000   -   15,000     
Total pre-development expense $28,690  $45,766  $(17,076)  (37.3%)
                 
  For the six months ended October 31,       
  2019  2018  $ Change  % Change
                 
Flora and fauna contractor $8,060  $8,837  $(777)  (8.8%)
Cultural resources and anthropological  -   1,096   (1,096)  (100.0%)
Environmental impact and plan of operations  21,766   33,070   (11,304)  -34.2%
Project management  5,375   40,247   (34,872)  (86.6%)
Water rights costs  7,562   7,562   -   0.0%
Technical consultants  15,000   -   15,000   N/A 
Total pre-development expense $57,763  $90,812  $(33,049)  (36.4%)
                 

Pre-development expense for the three months ended JulyOctober 31, 2019 was $29,073,$28,690, a decrease of $15,973$17,076 from 2018 pre-development expense of $45,046. $45,766.

Technical consultant expense increased in 2019 due to a consulting contract executed with Great Basin Resources, Inc. as consideration for amending the Longstreet Property Agreement. Under the terms of the agreement, Great Basin will provide consulting and geologic expertise for a period of 18 months at a monthly rate of $7,500 per month until March 2021.

Pre-development expense for the six months ended October 31, 2019 was $57,763, a decrease of $33,049 from 2018 pre-development expense of $90,812.

The Company is currently assembling bids from engineering firms for development of a full Plan of Operations and Mine Schedule for development and eventual submission of an application to permit construction of a heap leach mining operation on the Longstreet Property.

property.

On November 4, 2019, the United States Department of Agriculture-Forest Service approved the Company’s Longstreet Exploration Project which includes drilling of two test holes for water and a monitoring well to determine sufficient water supply for a potential mine at the Longstreet site.

Legal and professional fees

 
 For the three months ended July 31, 
   
   
 
 2019 
 2018 
 $ Change 
 % Change 
Audit and accounting
 $15,000 
 $15,000 
 $- 
  0.0%
Legal fees
  2,200 
  2,338 
  (138)
  (5.9%)
Public company expense
  15,364 
  12,557 
  2,807 
  22.4%
Investor relations
  7,696 
  - 
  7,696 
  N/A 
   Total legal and professional fees
 $40,260 
 $29,895 
 $10,365 
  34.7%
 
    
    
    
    
There was no change in audit

             
  For the three months ended October 31,       
  2019  2018  $ Change  % Change 
Audit and accounting $3,000  $3,000  $-   0.0%
Legal fees  7,975   1,925   6,050   314.3%
Public company expense  2,895   432   2,463   570.1%
Investor relations  5,592   -   5,592   N/A 
Total legal and professional fees $19,462  $5,357  $14,105   263.3%
                 
  For the six months ended October 31,       
  2019  2018  $ Change  % Change 
             
Audit and accounting $18,000  $18,000  $-   0.0%
Legal fees  10,175   4,263   5,912   138.7%
Public company expense  18,259   12,989   5,270   40.6%
Investor relations  13,288   -   13,288   N/A 
Total legal and professional fees $59,722  $35,252  $24,470   69.4%
                 

Audit and accounting fees of $15,000 for the three months ended JulyOctober 31, 2019 remained unchanged compared to the threethree- and six- months ended JulyOctober 31, 2018.

Page 21 of26

Legal fees increased $6,050 and $5,912 from the three and six months ended October 31, 2018, respectively, to $7,975 and $10,175 for the three and six months ended October 31, 2019, respectively. The increase in legal fees is primarily as the result of non-recurring expenses related to preparation of contracts and documentation for the Longstreet Property Option Agreement Amendment (Note 4 to the Financial Statements). There are no pending legal issues or contingencies as of October 31, 2019.

The primary component of public company expense is the annual fee associated with OTC Markets for the Company’s OTCQB status. Public company expense increased $2,807 in conjunction with services provided by$2,463 and $5,270, respectively for the company’s transfer agent.

Legal fees decreased $138 from $2,338three and six months ended October 31,2019 compared to October 31, 2018.

General and administrative expense

  For the three months ended October 31,       
  2019  2018  $ Change  % Change
             
Auto and travel $7,081  $13,091  $(6,010)  (45.9%)
General administrative and insurance  9,641   8,819   822   9.3%
Management fees and payroll  43,660   13,253   30,407   229.4%
Office and computer expense  957   2,320   (1,363)  (58.8%)
Rent and lease expense  -   750   (750)  (100.0%)
Telephone and utilities  179   257   (78)  (30.4%)
Total general and administrative $61,518  $38,490  $23,028   59.8%
                 
  For the six months ended October 31,       
  2019  2018  $ Change  % Change
             
Auto and travel $11,928  $20,750  $(8,822)  (42.5%)
General administrative and insurance  19,282   17,640   1,642   9.3%
Management fees and payroll  56,320   26,506   29,814   112.5%
Office and computer expense  1,976   2,951   (975)  (33.0%)
Rent and lease expense  -   1,500   (1,500)  (100.0%)
Telephone and utilities  354   595   (241)  (40.3%)
Total general and administrative $89,860  $69,942  $19,918   28.5%
                 

Total general and administrative expense increased $23,028 for the three months ended JulyOctober 31, 20182019 to $2,200$61,518 compared to $38,490 for the three months ended JulyOctober 31, 2019. There are no pending legal issues or contingencies as2018. The Company determined members of July 31, 2019.

Managementmanagement should be compensated for their time and expertise and accrued management fees for certain officers and directors to be paid at some future date.

Total general and administrative expense

 
 For the three months ended July 31, 
   
   
 
 2019 
 2018 
 $ Change 
 % Change 
Auto and travel
 $4,847 
 $7,659 
 $(2,812)
  (36.7%)
General administrative and insurance
  9,641 
  8,821 
  820 
  9.3%
Management fees and payroll
  12,660 
  13,253 
  (593)
  (4.5%)
Office and computer expense
  1,019 
  631 
  388 
  61.5%
Rent and lease expense
  - 
  750 
  (750)
  (100.0%)
Telephone and utilities
  176 
  338 
  (162)
  (47.9%)
   Total management and administrative
 $28,343 
 $31,452 
 $(3,109)
  (9.9%)
 
    
    
    
    
Total management and administrative expense decreased $3,109 increased $19,918 to $28,343 compared to 2018 expense of $31,452.
The primary difference was attributable to auto and travel expenses decreasing $2,812$89,860 for the threesix months ended JulyOctober 31, 2019 compared to $69,942 for the prior threesix months ended April 30,October 31, 2018.
Page 19 of 24

LIQUIDITY AND FINANCIAL CONDITION

       
WORKING CAPITAL October 31, 2019  April 30, 2019 
Current assets $117,555  $463,161 
Current liabilities  34,590   19,246 
Working capital $82,965  $443,915 
         
  For the six months ended 
CASH FLOWS October 31, 2019  October 31, 2018 
Cash flow used by operating activities $(209,949) $(218,363)
Cash flow used by investing activities  (129,800)  (12,000)
Cash flow provided by financing activities  -   - 
Net decrease in cash during period $(339,749) $(230,363)

Page 22 of26

WORKING CAPITAL
 July 31, 2019 
 April 30, 2019 
Current assets
 $360,360 
 $463,161 
Current liabilities
  50,380 
  19,246 
Working capital
 $309,980 
 $443,915 
 
 For the three months ended 
CASH FLOWS
 July 31, 2019 
 July 31, 2018 
Cash flow used by operating activities
 $(88,696)
 $(64,300)
Cash flow used by investing activities
  (12,000)
  (12,000)
Cash flow provided by financing activities
  - 
  - 
Net decrease in cash during period
 $(100,696)
 $(76,300)

As of JulyOctober 31, 2019, the Company had cash on hand of $339,620.$100,567. Since inception, the sole source of financing has been sales of the Company’s debt and equity securities. Star Gold Corp. has not attained profitable operations and its ability to pursue any future plan of operation is dependent upon our ability to obtain financing.

Star Gold Corp. anticipates continuing to rely on sales of its debt and/or equity securities in order to continue to fund ongoing operations. Issuances of additional shares of common stock may result in dilution to the Company’s existing stockholders. There is no assurance that the Company will be able to complete any additional sales of equity securities or that it will be able arrange for other financing to fund its planned business activities.

The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, to obtain additional financing as may be required, or ultimately to attain profitability. Potential sources of cash, or relief of demand for cash, include additional external debt, the sale of shares of the Company’s stock or alternative methods such as mergers or sale of the Company’s assets. No assurances can be given, however, that the Company will be able to obtain any of these potential sources of cash. The Company currently requires additional cash funding from outside sources to sustain existing operations and to meet current obligations and ongoing capital requirements.

The Company has sufficient capital to meet its obligations for the next twelve months but will require additional financing to complete its planned permitting tasks.

The Company plans for the long-term continuation as a going concern include financing future operations through sales of our equity and/or debt securities and the anticipated profitable exploitation of the Company’s mining properties. These plans may also, at some future point, include the formation of mining joint ventures with senior mining company partners on specific mineral properties whereby the joint venture partner would provide the necessary financing in return for equity in the property.

OFF-BALANCE SHEET ARRANGEMENTS

The Company has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to its stockholders.

ITEM 3. 
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company does not hold any derivative instruments and does not engage in any hedging activities.

ITEM 4.CONTROLS AND PROCEDURES

ITEM 4. 

CONTROLS AND PROCEDURES
Conclusions of Management Regarding Effectiveness of Disclosure Controls and Procedures

At the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was carried out under the supervision and with the participation of the Company'sCompany’s management, including the President and Principal Executive Officer ("PEO"(“PEO”) and Principal Financial Officer ("PFO"(“PFO”), of the effectiveness of the design and operations of the Company'sCompany’s disclosure controls and procedures (as defined in Rule 13a – 15(e) and Rule 15d – 15(e) under the Exchange Act). Based on that evaluation, the PEO and the PFO have concluded that as of the end of the period covered by this report, the Company'sCompany’s disclosure controls and procedures were not effective as it was determined that there were material weaknesses affecting our disclosure controls and procedures.

Page 20 of 24

Management of the Company believes that these material weaknesses are due to the small size of the Company'sCompany’s accounting staff. The small size of the Company'sCompany’s accounting staff may prevent adequate controls in the future, such as segregation of duties, due to the cost/benefit of such remediation. To mitigate the current limited resources and limited employees, we rely heavily on direct management oversight of transactions, along with the use of external legal and accounting professionals. As the Company grows, management expects to increase the number of employees, which will enable us to implement adequate segregation of duties within the internal control framework.

Page 23 of26

PEO and PFO Certifications

Appearing immediately following the Signatures section of this report there are Certifications of the PEO and the PFO. The Certifications are required in accordance with Section 03 of the Sarbanes-Oxley Act of 2002 (the Section 302 Certifications). This Items of this report which you are currently reading is the information concerning the Evaluation referred to in Section 302 Certifications and this information should be read in conjunction with Section 302 Certifications for a more complete understanding of the topics presented.

Changes in Internal Control over Financial Reporting

There have been no changes during the quarter ended JulyOctober 31, 2019 in the Company’s internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, internal controls over financial reporting.

PARTPART II - OTHER INFORMATION

ITEM 1. 
LEGAL PROCEEDINGS.

ITEM 1.LEGAL PROCEEDINGS.

Star Gold Corp. is not a party to any material legal proceedings, and, to Management’s knowledge, no such proceedings are threatened or contemplated. No director, officer or affiliate of Star Gold Corp. and no owner of record or beneficial owner of more than 5% of the Company’s securities or any associate of any such director, officer or security holder is a party adverse to Star Gold Corp. or has a material interest adverse to Star Gold Corp. in reference to pending litigation.

ITEM 1A. 
RISK FACTORS.

ITEM 1A.RISK FACTORS.

There have been no material changes from the risk factors as previously disclosed in the Company’s Form 10-K for the year ended April 30, 2019 which was filed with the SEC on July 22, 2019.

ITEM 2. 
RECENT SALES OF UNREGISTERED SECURITIES.

ITEM 2.RECENT SALES OF UNREGISTERED SECURITIES.

None.

ITEM 3. 
DEFAULTS UPON SENIOR SECURITIES.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES.

None

ITEM 4. 
MINE SAFETY DISCOSURES.

ITEM 4.MINE SAFETY DISCLOSURES.

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. The Company is in the exploration stage and has no operations.

Page 21 of 24

ITEM 5. 
OTHER INFORMATION.
None

ITEM 6. 
EXHIBITS.

operations.

ITEM 5.OTHER INFORMATION.

None

Page 24 of26

ITEM 6.EXHIBITS.

Exhibit 
NumberDescription of Exhibits
  
3.1
Articles of Incorporation.Incorporation.(1)
  
3.2
Bylaws, as amended.amended.(1)
  
4.1
Form of Share Certificate.Certificate.(1)
  
10.1
Purchase Agreement dated June 22, 2004 between Guy R. Delorme and Star Gold Corp.(1)
  
10.2
Declaration of Trust executed by Guy R. Delorme.(1)
  
14.1
Code of Ethics.(2)(2)
  
99.1
Property Option Agreement dated January 15, 2010 between Minquest, Inc., and Star Gold Corp.
  
99.1
Amendment to Longstreet Property Option Agreement dated December 10, 2014 between Minquest, Inc. and Star Gold Corp.
  
99.1
Amendment to Longstreet Property Option Agreement dated January 5, 2016 between Minquest, Inc. and Star Gold Corp.
  
99.1
Option and Lease of Water Rights Agreement dated January 19, 2017 between Stone Cabin Company, LLC and Star Gold Corp.
  
99.1
Option and Lease of Water Rights Agreement dated August 21, 2017 between High Test Hay, LLC and Star Gold Corp.Corp
.
  
10.5
2019 Amendment to Longstreet Property Option Agreement
  
99.2
Shareholder Letter January 23, 2017
  
99.2
Shareholder Letter March 20, 2018
  
99.2
Longstreet Property Press Release August 14, 2019
  
99.2
Shareholder Letter September 10, 2019
  
31.1
Certification of Principal Executive Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.2002
.
  
31.2
Certification of Principal Financial Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.2002
.
  
32.1
Certification of Principal Executive Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.2002
.
  
32.2
Certification of Principal Financial Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.2002
.
  
Page 22 of 24

101.INS(2)XBRL Instance
  
101.SCH*XBRL Taxonomy Extension Schema
  
101.CAL*XBRL Taxonomy Extension Calculation
  
101.DEF*XBRL Taxonomy Extension Definition
  
101.LAB*XBRL Taxonomy Extension Labels
  
101.PRE*XBRL Taxonomy Extension Presentation
  
(1)Filed with the SEC as an exhibit to the Company’s Registration Statement on Form SB-2 originally filed on June 14, 2007, as amended.
(2)Filed with the SEC, on February 02, 2012, as an exhibit to Form 8-K.
(*)XBRL Information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended and otherwise is not subject to liability under these sections.

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SIGNATURESSIGNATURES

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

STAR GOLD CORP.
    STAR GOLD CORP.
    
Date:
September 12,December 13, 2019By:
/s/DAVID SEGELOV
   President
   (Principal Executive Officer)
    
Date:September 12,December 13, 2019 
By:
/s/KELLY J. STOPHER
  By:Kelly J. Stopher
   Chief Financial Officer and Secretary
   (Principal Financial Officer)

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