Cover
Cover - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Mar. 31, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | DYNARESOURCE, INC. | |
Entity Central Index Key | 0001111741 | |
Document Type | 10-K | |
Amendment Flag | false | |
Entity Voluntary Filers | No | |
Current Fiscal Year End Date | --12-31 | |
Entity Well Known Seasoned Issuer | No | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Dec. 31, 2022 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2022 | |
Entity Common Stock Shares Outstanding | 22,246,654 | |
Entity Public Float | $ 30,188,751 | |
Document Annual Report | true | |
Entity File Number | 000-30371 | |
Entity Incorporation State Country Code | DE | |
Entity Interactive Data Current | Yes | |
Entity Address Address Line 1 | 222 W Las Colinas Blvd. | |
Entity Address Address Line 2 | Suite 1910 North Tower | |
Entity Address City Or Town | Irving | |
Entity Address State Or Province | TX | |
Entity Address Postal Zip Code | 75039 | |
City Area Code | 972 | |
Local Phone Number | 868-9066 | |
Auditor Name | Armanino LLP | |
Document Transition Report | false | |
Entity Tax Identification Number | 94-1589426 | |
Security 12b Title | Common Stock; $0.01 Par Value | |
Auditor Location | Dallas, Texas | |
Auditor Firm Id | 32 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 19,177,138 | $ 15,719,238 |
Accounts receivable | 724,642 | 577,118 |
Inventories | 2,720,811 | 2,110,203 |
Foreign tax receivable | 9,355,863 | 4,742,180 |
Other current assets | 1,145,501 | 667,742 |
Total current assets | 33,123,955 | 23,816,481 |
Property and equipment (net of accumulated depreciation of $119,154 and $116,425) | 0 | 2,729 |
Right-of-use assets, net | 550,473 | 648,381 |
Mining concessions | 4,132,678 | 4,132,678 |
Deferred tax asset | 2,970,410 | 0 |
Other assets | 165,396 | 162,174 |
TOTAL ASSETS | 40,942,912 | 28,762,443 |
Current liabilities: | ||
Accounts payable | 2,057,880 | 1,275,679 |
Accrued expenses | 5,756,961 | 5,440,204 |
Customer advances | 9,350,000 | 9,250,000 |
Derivative liabilities | 2,334,377 | 3,898,914 |
Convertible notes payable | 0 | 543,279 |
Current portion of operating lease payable | 28,868 | 98,169 |
Installment notes payable | 1,968,251 | 1,962,525 |
Total current liabilities | 21,334,377 | 22,468,770 |
Operating lease payable, less current portion | 558,914 | 587,782 |
TOTAL LIABILITES | 21,893,291 | 23,056,552 |
TEMPORARY EQUITY | ||
COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY (DEFICIT) | 0 | 0 |
Common Stock, $0.01 par value, 40,000,000 and 40,000,000 shares authorized 22,246,654 and 18,091,293 issued and outstanding | 222,467 | 180,913 |
Preferred rights | 40,000 | 40,000 |
Additional paid-in-capital | 56,889,031 | 50,632,400 |
Treasury stock, 12,180 and 12,180 shares | (34,773) | (34,773) |
Accumulated other comprehensive income | 112,078 | (247,665) |
Accumulated deficit | (44,036,663) | (50,722,465) |
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) | 13,192,141 | (151,589) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | 40,942,912 | 28,762,443 |
Series C Senior Convertible Preferred Stock | ||
TEMPORARY EQUITY | ||
Preferred stock, value | 4,337,480 | 4,337,480 |
Series D Senior Preferred Stock | ||
TEMPORARY EQUITY | ||
Preferred stock, value | 1,520,000 | 1,520,000 |
Series A Preferred Stock [Member] | ||
TEMPORARY EQUITY | ||
Preferred stock, value | $ 1 | $ 1 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Common Stock, Par Value | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 40,000,000 | 40,000,000 |
Common Stock, Shares Issued | 22,246,654 | 18,091,293 |
Common Stock, Shares Outstanding | 18,091,293 | 18,091,293 |
Treasury Stock | 12,180 | 12,180 |
Accumulated Depreciation, Mining Equipment And Fixtures | $ 119,154 | $ 116,425 |
Preferred Stock, Par Value | $ 0.0001 | |
Preferred Stock, Shares Authorized | 1,734,992 | |
Series C Senior Convertible Preferred Stock | ||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 1,734,992 | 1,734,992 |
Preferred Stock, Shares Issued | 1,734,992 | 1,734,992 |
Preferred Stock, Shares Outstanding | 1,734,992 | 1,734,992 |
Series D Senior Preferred Stock | ||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 3,000,000 | 3,000,000 |
Preferred Stock, Shares Issued | 760,000 | 760,000 |
Preferred Stock, Shares Outstanding | 760,000 | 760,000 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 3,000,000 | 1,000 |
Preferred Stock, Shares Issued | 1,000 | 1,000 |
Preferred Stock, Shares Outstanding | 1,000 | 1,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||
REVENUE | $ 39,767,460 | $ 35,886,046 |
COSTS AND EXPENSES OF MINING OPERATION | ||
Production cost applicable to sales | 4,413,649 | 2,909,401 |
Mine production costs | 6,500,975 | 3,965,467 |
Mine exploration costs | 5,707,832 | 5,198,057 |
Facilities expansion costs | 6,058,588 | 1,478,725 |
Exploration Drilling | 2,484,072 | 0 |
Camp, warehouse and facilities | 4,403,660 | 2,913,832 |
Transportation | 2,261,681 | 1,330,414 |
Property holding costs | 149,571 | 127,731 |
Stock Compensation Expense | 881,250 | 1,005,223 |
General and administrative | 4,134,902 | 3,768,250 |
Depreciation and amortization | 2,729 | 3,249 |
TOTAL OPERATING EXPENSES | 36,998,909 | 22,700,349 |
NET OPERATING INCOME | 2,768,551 | 13,185,697 |
OTHER INCOME (EXPENSE) | ||
Foreign currency gains (loss) | 58,426 | 247,712 |
Interest expense | (450,324) | (1,573,125) |
Derivatives mark-to-market gain (loss) | 1,726,497 | (2,186,912) |
Arbitration award expense | 0 | (1,111,111) |
Other income (expense) | 2,242 | 1,072 |
TOTAL OTHER INCOME (EXPENSE) | 1,336,841 | (4,622,364) |
NET INCOME BEFORE TAXES | 4,105,392 | 8,563,333 |
PROVISION FOR INCOME TAXES (BENEFIT) | (2,580,410) | 28,970 |
NET INCOME | 6,685,802 | 8,534,363 |
DEEMED DIVIDEND FOR SERIES C & D PREFERRED | (234,299) | (188,699) |
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ 6,451,503 | $ 8,345,664 |
EARNINGS PER SHARE ATTRIBUTABLE TO THE EQUITY HOLDERS OF DYNARESOURCE, INC. | ||
Basic Income per common share | $ 0.33 | $ 0.47 |
Weighted average shares outstanding - Basic | 19,456,765 | 17,797,528 |
Diluted Income per common share | $ 0.29 | $ 0.47 |
Weighted average shares outstanding - Diluted | 22,890,246 | 17,797,528 |
OTHER COMPREHENSIVE INCOME (LOSS) | ||
Unrealized foreign currency translation gain (loss) | $ 359,743 | $ (685,757) |
TOTAL OTHER COMPREHENSIVE INCOME (LOSS) | 359,743 | (685,757) |
TOTAL COMPREHENSIVE INCOME | $ 7,045,545 | $ 7,848,606 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) - USD ($) | Total | Series A Preferred Stocks | Common Stock | Accumulated other comprehensive loss | Preferred Stock | Paid In Capital | Treasury Stock | Retained Earnings (Accumulated Deficit) |
Balance, shares at Dec. 31, 2020 | 1,000 | 17,722,825 | 1 | 516,480 | ||||
Balance, amount at Dec. 31, 2020 | $ (9,668,660) | $ 1 | $ 177,228 | $ 438,092 | $ 40,000 | $ 50,407,333 | $ (1,474,486) | $ (59,256,828) |
Treasury Stock Issued for Services, shares | 504,300 | |||||||
Treasury Stock Issued for Services, amount | 1,005,223 | 434,490 | $ 1,439,713 | |||||
Stock Warrants Exercised, shares | 368,468 | |||||||
Stock Warrants Exercised, amount | 663,242 | $ 3,685 | 659,557 | |||||
Other Comprehensive Income | (685,757) | |||||||
Net Income (Loss) | $ 8,534,363 | |||||||
Balance, shares at Dec. 31, 2021 | 3,060,998 | 1,000 | 18,091,293 | 1 | 12,180 | |||
Balance, amount at Dec. 31, 2021 | $ (151,589) | $ 1 | $ 180,913 | (247,665) | $ 40,000 | 50,632,400 | $ (34,773) | (50,722,465) |
Stock Warrants Exercised, shares | 2,655,361 | |||||||
Stock Warrants Exercised, amount | 5,416,935 | $ 26,554 | 5,390,381 | |||||
Other Comprehensive Income | 359,743 | |||||||
Net Income (Loss) | 6,685,802 | |||||||
Stock Issued for Services, shares | 1,500,000 | |||||||
Stock Issued for Services, amount | $ 881,250 | $ 15,000 | 866,250 | |||||
Balance, shares at Dec. 31, 2022 | 892,165 | 1,000 | 22,246,654 | 1 | 12,180 | |||
Balance, amount at Dec. 31, 2022 | $ 13,192,141 | $ 1 | $ 222,467 | $ 112,078 | $ 40,000 | $ 56,889,031 | $ (34,773) | $ (44,036,663) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITES: | ||
Net Income | $ 6,685,802 | $ 8,534,363 |
Adjustments to reconcile net income to cash used in operating activities | ||
Derivatives mark-to-market (gain) loss | (1,726,497) | 2,186,912 |
Depreciation and amortization | 2,729 | 3,249 |
Right-of-use assets, amortization | 97,908 | 86,839 |
Amortization of loan discount | 0 | 755,214 |
Stock issued for services | 881,250 | 1,005,223 |
Deferred tax asset | (2,970,410) | 0 |
Change in operating assets and liabilities | ||
Accounts receivable | (147,524) | 263,625 |
Inventories | (610,608) | (1,506,236) |
Foreign tax receivable | (4,613,683) | (2,562,266) |
Appeal bond | 0 | 1,111,111 |
Other assets | (480,981) | (85,875) |
Accounts payable | 782,201 | (998,332) |
Accrued expenses | 96,757 | 2,055,111 |
Customer advances | 100,000 | 6,750,000 |
Operating lease liabilities | (98,169) | (82,733) |
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES | (1,781,225) | 17,516,205 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from exercise of stock warrants | 5,416,935 | 3,685 |
Payments of convertible notes | (543,279) | (2,500,000) |
Payments of long-term debt | (94,698) | (61,406) |
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES | 4,778,958 | (2,557,721) |
Effects of foreign currency exchange | 460,167 | (743,262) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVILANTS | 3,457,900 | 14,215,222 |
CASH AND CASH EQUIVILANTS AT BEGINNING OF PERIOD | 15,719,238 | 1,504,016 |
CASH AND CASH EQUIVILANTS AT END OF PERIOD | 19,177,138 | 15,719,238 |
SUPPLEMENTAL DISCLOSURES | ||
Cash paid for interest | 63,277 | 583,144 |
Cash paid for income taxes | $ 28,970 | $ 0 |
NATURE OF ACTIVITIES AND SIGNIF
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES Nature of Activities, History and Organization DynaResource, Inc. (The “Company”, “DynaResource”, or “DynaUSA”) was organized September 28, 1937, as a California corporation under the name of West Coast Mines, Inc. In 1998, the Company re-domiciled to Delaware and changed its name to DynaResource, Inc. The Company is in the business of acquiring, investing in, and developing precious metal properties, and the production of precious metals. In 2000, the Company formed a wholly owned subsidiary, DynaResource de México S.A. de C.V., chartered in México (“DynaMéxico”). This Company was formed to acquire, invest in and develop resource properties in México. DynaMéxico owns a portfolio of mining concessions that currently includes its interests in the San José de Gracía Project (“SJG”) in northern Sinaloa State, México. The SJG District covers 9,920 hectares (24,513 acres) on the west side of the Sierra Madre mountain range. DynaUSA currently owns 80% of the outstanding capital of DynaMéxico, 79% directly and 1% held by the current CEO on behalf of the Company, in compliance with Mexican law. DynaMéxico currently holds 20% of the Shares of DynaMéxico as treasury shares, after complete foreclosure and recovery of those shares on February 20, 2020 from Goldgroup Resources Inc., a wholly owned subsidiary of Goldgroup Mining Inc. Vancouver, BC (“Goldgroup”). In 2005, the Company formed DynaResource Operaciones de San Jose De Gracía S.A. de C.V. (“DynaOperaciones”) as an operating subsidiary to manage registered employees, and acquired effective control of Mineras de DynaResource, S.A. de C.V. (formerly Minera Finesterre S.A. de C.V., “DynaMineras”). In 2020 the Company moved its registered employees from DynaOperaciones to DynaMexico in compliance with changes in Mexican employment law. The Company owns 100% of DynaMineras and 100% of DynaOperaciones. The Company elected to become a voluntary reporting issuer in Canada in order to avail itself of Canadian regulations regarding reporting for mining properties and, more specifically, National Instrument 43-101 (“NI 43-101”). This regulation sets forth standards for reporting resources in a mineral property and is a standard recognized in the mining industry. Reclassifications and Adjustments Certain financial statement reclassifications have been made to prior period balances to reflect the current period’s presentation format, such reclassifications had no impact on the Company’s consolidated statements of income or consolidated statements of cash flows and had no material impact on the Company’s consolidated balance sheets. Significant Accounting Policies The consolidated financial statements and notes are representations of the Company’s management which is responsible for their integrity and objectivity. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items that: 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce consolidated financial statements which present fairly the consolidated financial condition, results of operations and cash flows of the Company for the respective periods presented. Basis of Presentation The Company prepares its consolidated financial statements on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States. Use of Estimates In order to prepare consolidated financial statements in conformity with accounting principles generally accepted in the United States, management must make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and determines whether contingent assets and liabilities, if any, are disclosed in the consolidated financial statements. The ultimate resolution of issues requiring these estimates and assumptions could differ significantly from the resolution currently anticipated by management and on which the consolidated financial statements are based. Principles of Consolidation The consolidated financial statements include the accounts of DynaResource, Inc., as well as DynaResource de México, S.A. de C.V., DynaResource Operaciones S.A. de C.V. and Mineras de DynaResource S.A. de C.V. All significant inter-company transactions have been eliminated. All amounts are presented in U.S. Dollars unless otherwise stated. Cash and Cash Equivalents The Company considers all highly liquid debt instruments with an original maturity of three months or less to be cash equivalents. At times, cash balances may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. As of December 31, 2022, the Company had $ 18,375,699 of deposits in U.S. Banks in excess of the FDIC limit. The Company does not believe it is at a risk of loss on cash. Accounts Receivable and Allowances for Doubtful Accounts The allowance for accounts receivable is recorded when receivables are considered to be doubtful of collection. As of December 31, 2022, and 2021, respectively, no allowance has been made. During the year ended December 31, 2021 the Company recorded a $381,871 bad debt write off of receivables from a former customer of the Company. At, December 31, 2022 management believes all accounts receivable are fully collectable. Inventories Inventories are carried at the lower of cost or net realizable value and consist of mined tonnage, gravity and flotation concentrates, and gravity tailings or flotation feed material. The inventories were $2,720,811 and $2,110,203 as of December 31, 2022 and December 31, 2021, respectively. Foreign Tax Receivable Foreign Tax Receivable is comprised of recoverable value-added taxes (“IVA”) charged by the Mexican government on goods and services rendered to the company in Mexico and paid by the company. Under certain circumstances, these taxes are recoverable by filing a tax return and application for reimbursement. IVA amounts charged to and paid by the company are recorded and carried as receivables until the funds are collected by the company. The total amounts of the IVA receivable as of December 31, 2022 and December 31, 2021 were $9,355,863 and $4,742,180, respectively. In 2022, the Company recovered $403,308 of the IVA receivable. Exploration Stage According to Section 1300 of Regulation S-K, the Registrant is an exploration stage issuer with an exploration stage property since it does not have proven and probable reserves as defined in Section 1300 and does not have a preliminary or final feasibility study. Property and Equipment Substantially all mine development costs, including design, engineering, mine construction, and installation of equipment are expensed as incurred as the Company has not established proven and probable reserves on any of its properties. Only certain types of mining equipment which has alternative uses or significant salvage value, may be capitalized without proven and probable reserves. Depreciation is computed using the straight-line method. Office furniture and equipment are being depreciated on a straight-line method over estimated economic lives ranging from 3 to 5 years. Leasehold improvements, which relate to the Company's corporate office, are being amortized over the term of the lease of 10 years. Design, Construction, and Development Costs: Mineral Properties Interests Mineral property interests include acquired interests in development and exploration stage properties, which are considered tangible assets. The amount capitalized relating to a mineral property interest represents its fair value at the time of acquisition. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, such as with the San Jose de Gracía Property, capitalized costs and mineral property interests are amortized using the straight-line method once proven and probable reserves are extracted. As of December 31, 2022, the mining interests have been in the pilot production stage and therefore, no amortization has been expensed. Mining properties consist of 33 mining concessions covering approximately 9,920 hectares at the San Jose de Gracía property (“SJG”), the basis of which will be amotized once proven and probable reserves are extracted on the unit of production method based on estimated recoverable resources. If it is determined that the deferred costs related to a property are not recoverable over its productive life, those costs will be written down to fair value as a charge to operations in the period in which the determination is made. The amounts at which mineral properties and the related costs are recorded do not necessarily reflect present or future values. Impairment of Assets: For operating mines, recoverability is measured by comparing the undiscounted future net cash flows to the net book value. When the net book value exceeds future net undiscounted cash flows, an impairment loss is measured and recorded based on the excess of the net book value over fair value. Fair value for operating mines is determined using a combined approach, which uses a discounted cash flow model for the existing operations and a market approach for the fair value assessment of exploration land claims. Future cash flows are estimated based on quantities of recoverable mineralized material, expected gold and silver prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine plans. The term "recoverable mineralized material" refers to the estimated amount of gold or other commodities that will be obtained after considering losses during processing and treatment of mineralized material. In estimating future cash flows, assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of future cash flows from other asset groups. The Company's estimates of future cash flows are based on numerous assumptions and it is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold, silver and other commodity prices, production levels and costs and capital are each subject to significant risks and uncertainties. The recoverability of the book value of each property is assessed annually for indicators of impairment such as adverse changes to any of the following: · estimated recoverable ounces of gold, silver or other precious minerals; · estimated future commodity prices; · estimated expected future operating costs, capital expenditures and reclamation expenditures. A write-down to fair value will be recorded when the expected future cash flow is less than the net book value of the property or when events or changes in the property indicate that carrying amounts are not recoverable. This analysis is completed as needed, and at least annually. As of the date of this filing, no events have occurred that would require write-down of any assets. As of December 31, 2022, and 2021, no indications of impairment existed. Asset Retirement Obligation As the Company is not obligated to remediate the mining properties, no Asset Retirement Obligation (“ARO”) has been established. Changes in regulations or laws, any instances of non-compliance with laws or regulations that result in fines, or any unforeseen environmental contamination could result in a material impact to the amounts charged to operations for reclamation and remediation. Transactions in and Translations of Foreign Currency The functional currency for the subsidiaries of the Company is the Mexican Peso. As a result, the financial statements of the subsidiaries have been translated from Mexican Pesos into U.S. dollars using (i) year-end exchange rates for balance sheet accounts, and (ii) the weighted average exchange rate of the reporting period for all income statement accounts. Foreign currency translation gains and losses are reported as a separate component of stockholders’ equity and comprehensive income (loss). The financial statements of the subsidiaries should not be construed as representations that Mexican Pesos have been, could have been or may in the future be converted into U.S. dollars at such rates or any other rates. Relevant exchange rates used in the preparation of the financial statements for the subsidiaries are as follows for the years ended December 31, 2022 and 2021 (Mexican Pesos per one U.S. dollar): Dec 31, 2022 Dec 31, 2021 Current exchange rate Pesos 19.48 20.48 Weighted average exchange rate for the period ended Pesos 20.11 20.29 The Company recorded currency transaction gains (losses) of $58,426 for the year ended December 31, 2022 and $247,712 for the year ended December 31, 2021. Income Taxes The Company accounts for income taxes under ASC 740 “Income Taxes” Uncertain Tax Position The Company is subject to income taxes in the U.S. and other foreign jurisdictions, with respect to which some of the outcome is uncertain. The evaluation of the Company’s uncertain tax positions involves significant judgment in the interpretation and application of GAAP and complex domestic and international tax laws. We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that it becomes uncertain based upon one of the following conditions: (1) the tax position is not "more likely than not" to be sustained, (2) the tax position is "more likely than not" to be sustained, but for a lesser amount, or (3) the tax position is "more likely than not" to be sustained, but not in the financial period in which the tax position was originally taken. For purposes of evaluating whether or not a tax position is uncertain, (1) we presume the tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information; (2) the technical merits of a tax position are derived from authorities such as legislation and statutes, legislative intent, regulations, rulings and case law and their applicability to the facts and circumstances of the tax position; and (3) each tax position is evaluated without consideration of the possibility of offset or aggregation with other tax positions taken. Although management believes the Company’s reserves are reasonable, no assurance can be given that the final outcome of these uncertainties will not be different from that which is reflected in the Company’s reserves. A number of years may elapse before a particular uncertain tax position is audited and finally resolved or when a tax assessment is raised. The number of years subject to tax assessments varies depending on the tax jurisdiction. Any tax benefit that is or has been reserved because of a failure to meet the "more likely than not" recognition threshold would be recognized in income tax expense in the first interim period when the uncertainty disappears under any one of the following conditions: (1) the tax position is "more likely than not" to be sustained, (2) the tax position, amount, and/or timing is ultimately settled through negotiation or litigation, or (3) the statute of limitations for the tax position has expired. Refer to Note 6. Comprehensive Income (Loss) ASC 220 “Comprehensive Income” Revenue Recognition The Company accounts for revenue recognition under ASC 606 “ Revenue from contracts with customers The amount of revenue recognized is initially recorded on a provisional basis based on the contract price and the estimated metal quantities based on assay data. The revenue is adjusted upon final settlement of the sale. The chief risk associated with the recognition of sales on a provisional basis is the fluctuations between the estimated quantities of precious metals based on the initial assay and the actual recovery from treatment and processing. As of December 31, 2022, there are $9,350,000 in customer advances for payments received during the period for contracts expected to be settled in 2023. During the years ended December 31, 2022, and December 31, 2021, there was $9,250,000 and $1,500,000 of revenue recognized during the period from customer deposit liabilities (deferred contract revenue) from prior periods, and $0 of customer deposits refunded to the customer due to order cancellation. As of and for the year ended December 31, 2022, and December 31, 2021, there are no deferred contract costs or commissions. We have elected to account for shipping and handling costs as fulfillment costs after the customer obtains control of the concentrate. Fair Value of Financial Instruments The Company’s financial instruments consist of cash, receivables, payables and installment notes payable. The carrying amount of cash, accounts receivable and accounts payable approximates fair value because of the short-term nature of these items. The carrying amount of installment notes payable debt approximates fair value due to the relationship between the interest rate on installment notes payable debt and the Company’s incremental risk adjusted borrowing rate. Earnings Per Share Earnings per share are calculated in accordance with ASC 260 “ Earnings per Share The Company had warrants outstanding to purchase 892,165 shares of common stock at December 31, 2022 which upon exercise, would result in the issuance of 892,165 shares of common stock. These warrants are exercisable at $0.01 per share The Company’s Series C Preferred Stock including outstanding dividends is convertible into 2,643,082 shares of Common Stock at December 31, 2022. The Company’s Series D Preferred including outstanding dividends is convertible into 790,400 shares of common stock at December 31, 2022. The Company had warrants outstanding (the 2015 Warrant) to purchase 2,657,895 shares of common stock at December 31, 2021 which upon exercise, would result in the issuance of 3,060,998 shares of common stock. Of these warrants 2,168,745 were exercisable at $2.04 per share and 892,165 were exercisable at $0.01 per share. The Company also had convertible debt instruments as of December 31, 2021 which, upon conversion at $2.50 per share, would result in the issuance of 217,312 shares of common stock. Years ended December 31 2022 2021 Net income (loss) attributable to common shareholders $ 6,744,654 $ 8,345,664 Shares: Weighted average number of common shares outstanding, Basic 19,456,765 17,797,528 Weighted average number of common shares outstanding, Diluted 22,890,246 17,797,528 Basic income (loss) per share $ 0.33 $ 0.47 Diluted income (loss) per share $ 0.29 $ 0.47 Diluted Earnings Per Share is calculated as follows: Dec 31, 2022 Net income attributable to common shareholders $ 6,451,503 Deemed Dividends of Series C Preferred Stock 173,499 Deemed Dividends of Series D Preferred Stock 60,800 Adjusted Diluted Earnings $ 6,685,802 Weighted average number of share outstanding - Basic 19,456,765 Series C Preferred Stock Common Stock Equivalent 2,643,082 Series D Preferred Stock Common Stock Equivalent 790,400 Weighted average number of share outstanding - Diluted 22,890,246 Diluted Earnings Per Share $ 0.29 At December 31, 2022, 892,165 of potentially dilutive common stock related to outstanding warrants were excluded from the diluted earnings per share calculation as the net income impact of the converted shares would cause earnings per share to increase, therefore their effect would be antidilutive. At December 31, 2021, 2,168,833 shares of potentially dilutive common stock related to outstanding stock warrants and 217,312 shares of potentially dilutive common stock related to convertible debt were excluded from the diluted earnings per share calculation, using the treasury stock method, because the exercise and conversion prices exceeded the average stock price and therefore their effect would be anti-dilutive. In addition, at December 31, 2021, 892,165 of potentially dilutive common stock related to outstanding warrants were excluded from the diluted earnings per share calculation as the net income impact of the converted shares would cause earnings per share to increase, therefore their effect would be antidilutive. Related Party Transactions FASB ASC 850 "Related Party Disclosures" |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2022 | |
INVENTORIES | |
INVENTORIES | NOTE 2 – INVENTORIES Inventories are carried at the lower of cost or fair value and consist of mined tonnage, gravity-flotation concentrates, and gravity tailings (or, flotation feed material). Inventory balances at December 31, 2022 and 2021, respectively, were as follows: 2022 2021 Mined Tonnage $ 2,610,116 $ 2,042,633 Gold-Silver Concentrates 110,695 67,570 Total Inventories $ 2,720,811 $ 2,110,203 |
PROPERTY
PROPERTY | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY | |
PROPERTY | NOTE 3 – PROPERTY Property consists of the following at December 31, 2022 and 2021: 2022 2021 Leasehold improvements $ 9,340 $ 9,340 Office equipment 31,012 31,012 Office furniture and fixtures 78,802 78,802 Sub-total 119,154 119,154 Less: Accumulated depreciation (119,154 ) (116,425 ) Total Property $ - $ 2,729 Depreciation and amortization has been provided over each asset’s estimated useful life. Depreciation and amortization expense was $ 2,729 and $3,249 for the years ended December 31, 2022 and 2021 respectively. |
MINING CONCESSIONS
MINING CONCESSIONS | 12 Months Ended |
Dec. 31, 2022 | |
MINING CONCESSIONS | |
MINING CONCESSIONS | NOTE 4 – MINING CONCESSIONS Mining properties consist of the San Jose de Gracía (“SJG”) concessions. Mining Concessions were $4,132,678 and $4,132,678 at December 31, 2022 and December 31, 2021, respectively. As we are an exploration stage company, there was no depletion expense for the years ended December 31, 2022 and 2021. |
CONVERTIBLE PROMISSORY NOTES
CONVERTIBLE PROMISSORY NOTES | 12 Months Ended |
Dec. 31, 2022 | |
CONVERTIBLE PROMISSORY NOTES | |
CONVERTIBLE PROMISSORY NOTES | NOTE 5 – CONVERTIBLE PROMISSORY NOTES Notes Payable – Series I In April and May 2013, the Company entered into note agreements with shareholders in the principal amount of $1,495,000, of which $340,000 was converted to preferred shares within the same year, netting proceeds of $1,155,000 (the “Series I Notes”). The Series I Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The Series I Note holders retained the option, at any time prior to maturity or prepayment, to convert any unpaid principal and accrued interest into Common Stock at $2.50 per share. If the Series I Note is converted into Common Stock, at the time of conversion, the holder would also receive warrants, in the same number as the number of common shares received upon conversion, to purchase additional common shares of the Company for $7.50 per share, with such warrants expiring one year from their conversion date. The Notes originally matured on December 31, 2015. The notes were extended multiple times including some interest payments being rolled into the principal. At December 31, 2021, six Series I Notes remained outstanding with a total balance of $455,905. On July 1, 2022 the remaining Series I Notes were paid off in full in cash. None of the notes were converted into common stock and no stock warrants were issued. Notes Payable – Series II In 2013 and 2014, the Company entered into additional note agreements of $199,808 and $250,000, respectively (the “Series II Notes”) with similar terms as the Series I Notes. The Series II Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The Note holder retained the option to at any time prior to maturity or prepayment, convert any unpaid principal and accrued interest into common stock of the Company at $2.50 per share. At the time of conversion, the holder would receive a warrant to purchase additional common shares of the Company for $7.50 per share, such warrant expiring one year from their conversion date. The Notes originally matured on December 31, 2015. The notes were extended multiple times including some interest payments being rolled into principal. At December 31, 2021, two Series II notes remained outstanding with a balance of $87,374. On July 1, 2022 the remaining Series II Notes were paid off in full in cash. None of the notes were converted into common stock and no stock warrants were issued. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES | |
INCOME TAXES | NOTE 6 – INCOME TAXES FASB ASC 740-10, Income Taxes, mandates the asset and liability approach to determine the income tax provision or benefit. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Income tax receivables and liabilities and deferred tax assets and liabilities are recognized based on the amounts that more likely than not will be sustained upon ultimate settlement with taxing authorities. Developing our provision for income taxes and analysis of uncertain tax positions requires significant judgment and knowledge of federal and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. We assess the realization of our deferred tax assets to determine whether an income tax valuation allowance is required. Based on all available evidence, both positive and negative, and the weight of that evidence to the extent such evidence can be objectively verified, we determine whether it is more likely than not that all or a portion of the deferred tax assets will be realized. We consider many factors when evaluating our uncertain tax positions, and such judgments are subject to periodic review. Tax benefits associated with uncertain tax positions are recognized in the period in which one of the following conditions is satisfied: (1) the more likely than not recognition threshold is satisfied; (2) the position is ultimately settled through negotiation or litigation; or (3) the statute of limitations for the taxing authority to examine and challenge the position has expired. Tax benefits associated with an uncertain tax position are derecognized in the period in which the more likely than not recognition threshold is no longer satisfied. December 31, December 31, 2022 2021 Federal Net Operating Loss Carryforwards $ 509,711 $ 4,653,402 Foreign Net Operating Loss Carryforwards 2,459,782 7,674,197 Other 917 862 Total Deferred Tax Asset 2,970,410 12,328,461 Less Valuation Allowance - (12,328,461 ) Net Deferred Tax Asset $ 2,970,410 $ - The Company's pre-tax income (loss) by jurisdiction was as follows for the years ending December 31, 2022 and December 31, 2021 December 31, December 31, 2022 2021 Domestic $ 3,221,618 $ (10,064,644 ) Foreign 883,774 18,627,977 Total $ 4,105,392 $ 8,563,333 25 Table of Contents The provision for income taxes for continuing operations for the year ended December 31, 2022 and December 31, 2021 consist of the following December 31, December 31, 2022 2021 Current income taxes Federal $ 220,000 $ - State - - Foreign 170,000 28,970 Total current income taxes $ 390,000 $ 28,970 Deferred income taxes Federal $ (510,629 ) $ - State - - Foreign (2,459,781 ) - Total deferred income taxes $ (2,970,410 ) - Total income tax expense (benefit) $ (2,580,410 ) $ 28,970 A reconciliation between the amount of reported income tax expense (benefit) and the amount computed by multiplying income from continuing operations before income taxes by the statutory federal income tax rate is shown below. Income tax expense for the year ended December 31, 2022 includes state minimum taxes, permanent differences, and deferred tax assets for which a full valuation allowance has been released. A corresponding tax benefit is included for the year ended December 31, 2022 to reflect the release in the valuation allowance. December 31, December 31, 2022 2021 Tax Expense at statutory federal rate of 21% $ 808,560 $ 1,798,300 Permanent Differences 927,343 501,707 Foreign Rate Differential 56,580 1,103,990 GILTI NOL Impact 145,913 - GILTI NOL Adjustment – Previously Offset by Valuation Allowance 7,781,388 - Change in Valuation Allowance (12,328,462 ) $ (1,143,877 ) Other 28,268 $ (2,231,150 ) Income tax expense (benefit) $ (2,580,410 ) $ 28,970 The net deferred tax asset and benefit for the current year is generated primarily from cumulative net operating loss carryforward, which totals approximately $11 million at December 31, 2022. December 31, December 31, 2022 2021 United States Expiring 2029 to 2037 $ - $ 16,400,000 United States Indefinite Limited to 80% 2,800,000 2,700,000 Foreign NOLs 8,200,000 12,500,000 $ 11,000,000 $ 31,600,000 At December 31, 2022, our carryforwards available to offset US federal future taxable income consisted of net operating loss (“NOL”) carryforwards of approximately $2.8 million pre-tax, all of which, has no expiration date. Future NOL utilization will be subject to the 80-percent of taxable income limitation, as all remaining NOLs have been generated after 2017 and the passage of the Tax Cuts and Jobs Act of 2017. The Company’s Mexico net operating losses of $8.2M pre-tax are subject to a ten-year carryforward period and the Company anticipates utilizing all of its Mexico NOL in future years before expiration. During the year ended December 31, 2022, the valuation allowance was released. The Company believes a full valuation allowance against the net deferred tax asset is no longer warranted based on the positive evidence in recent years. Such positive evidence includes no longer being in a three-year cumulative losses, the rising prices in gold, utilization of current year tax attributes, and projected taxable income in the future. Our practice is to recognize interest and penalties related to income taxes in income tax expense in continuing operations, as incurred. We did not have any uncertain tax benefits or interest and penalties related to uncertain tax benefits as of December 31, 2022. The Company is subject to income taxes in the US federal jurisdiction as well as Mexico. The Company is no longer subject to US federal, state and local tax examinations by tax authorities for years prior to fiscal year 2021. The Company began utilizing its NOL in 2021. The statute of limitations began when the Company filed its 2021 US Federal Tax Return. The Company is no longer subject to Mexican tax examinations for years prior to fiscal year 2017. The Company is currently not under audit by any tax authority. The Company has not provided U.S. income taxes and foreign withholding taxes, on its cumulative earnings for certain non-U.S. subsidiaries, because such earnings are intended to be indefinitely reinvested. Determination of the amount of unrecognized deferred tax liability for temporary differences related to investments in these non-U.S. subsidiaries that are essentially permanent in duration is not practicable. |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS EQUITY | |
STOCKHOLDERS EQUITY | NOTE 7 – STOCKHOLDERS’ EQUITY Authorized Capital Series A Preferred Stock The Company has designated 1,000 shares of its Preferred Stock as Series A, having a par value of $0.0001 per share. Holders of the Series A Preferred Stock have the right to elect a majority of the Board of Directors of the Company. In 2007, the Company issued 1,000 shares of Series A Preferred Stock to its current CEO. At December 31, 2022 and December 31, 2021, there were 1,000 shares of Series A Preferred Stock outstanding. Series C Senior Convertible Preferred Stock At December 31, 2022 and December 31, 2021, there were 1,734,992 and 1,734,992 Series C Preferred shares outstanding, respectively. These Series C Preferred Shares are convertible to common shares at $2.04 per share, redeemable on demand and include anti-dilution protection on both the Preferred Series C and the 2,655,361 of Common Stock acquired through the exercise of the Series C stock warrants in June 2022. The Series C Preferred Shares may receive a 4% per annum dividend, payable if available, and in arrears. The Dividend is calculated at 4.0% of $4,337,480 payable annually on June 30. At December 31, 2022, dividends for the years 2017 to 2022 totaling $1,053,777 were in arrears. Due to the nature of this transaction as mandatorily redeemable by the Company at the election of the Series C preferred stock shareholder at maturity, the Series C Senior Convertible Preferred Shares are classified as “temporary equity” on the balance sheet. The 2015 Warrant - Attached to the Series C Preferred Stock issued in 2015 were 2,000,000 warrants, described as the “2015 Warrant” which gave the holder the right to purchase common shares at $2.50 per share. After anti-dilution protection, these warrants became 2,166,527 warrants to purchase common shares at $2.04 and on June 28, 2022, the 2015 Warrant was exercised. Series D Senior Convertible Preferred Stock Financing Agreement with Golden Post Rail, LLC, a Texas Limited Liability Company, and with Shareholders of DynaResource, Inc. On May 14, 2020, the Company closed an additional financing agreement with Golden Post, and with certain individual shareholders of DynaUSA (“DynaUSA Shareholders”), and related agreements. A summary of the transactions and related agreements are set forth below: 1. Pursuant to the May 14, 2020 Note Purchase Agreement (the “NPA”) among the Company, Golden Post Rail, LLC (the “Lead Purchaser”), and the other parties listed on Exhibit A of the NFP (the “Remaining Purchasers”): · Golden Post acquired the following securities (a) A convertible promissory note (the “Golden Post Note”) payable to Golden Post in the principal amount of $2,500,000, bearing interest at 10%, and maturing two years from the date of execution. The Golden Post Note was convertible, at the option of Golden Post, into shares of Series D Senior Convertible Preferred Stock (the “Series D Preferred”) at a conversion price of $2.00 per share: and (b) A common stock purchase warrant (the “2020 Warrant”) for the purchase of 783,976 shares of the Company’s common stock, at an exercise price of $0.01 per share, and maturing on the 10-year anniversary of the date of issuance. The 2020 Warrant contains anti-dilution provisions; and · The Remaining Purchasers acquired the following securities (a) Convertible promissory notes (the “Remaining Notes”) in the aggregate principal amount of $1,400,000, bearing interest at 10%, and maturing two years from the date of issuance. The Remaining Notes have been fully funded. The Remaining Notes are convertible, at the option of each individual Remaining Purchaser, into shares of Series D Preferred at a conversion price of $2.00 per share; and (b) Common stock purchase warrants (the “Remaining Purchasers Warrants”) for the purchase of an aggregate of 439,026 shares of the Company’s common stock, at an exercise price of $0.01 per share, and maturing on the 10-year anniversary of the date of issuance. The Remaining Purchasers Warrants contain anti-dilution provisions. Retirement of Series D Convertible Debt On October 7, 2021, the Company paid $2,500,000 to repurchase one note that was convertible into Series D Preferred Stock. The remaining ten noteholders of notes convertible into Series D Preferred Stock elected to convert their notes totaling $1,520,000 into Series D Preferred stock at $2.00 per share. On October 18, 2021 the Company issued 760,000 shares of Series D Preferred Stock for these notes. In addition the redemption of the Series D notes trigged an acceleration of the amortization of the original loan discount booked at the issuance of the Series D notes (see discussion below) and being amortized over the 24 month life of the notes of $287,508 in October 2021. As part of the transaction all Series D noteholders agreed to waive the non-dilution rights contained in the original note and an amendment of the Series D Preferred Stock designation was filed with the State of Delaware. At December 31, 2022 and December 31, 2021, there were 760,000 and 760,000 Series D Preferred shares outstanding, respectively. These Series D Preferred Shares are convertible to common shares at $2.00 per share, through October 18, 2026. The Series D Preferred Shares carry a 4% per annum dividend and in arrears. The Dividend is calculated at 4.0% of $1,520,000 payable annually on October 18. At December 31, 2022, $60,800 dividends were in arrears. Due to the nature of this transaction as mandatorily redeemable by the Company at the election of the Series D preferred stock holder at maturity, the Series D preferred shares are classified as “temporary equity” on the balance sheet. Due to underlying anti-dilutive provisions contained in the Series C Preferred Stock and the 2015 Warrant, the Company incurred derivative liabilities. On May 14, 2020 in connection with the Series D Convertible Note financing, the expiration date for the Series C Preferred Stock and the 2015 Warrant were extended to June 30, 2022. In addition, a new derivative liability was incurred due to the issuance of warrants for kicker shares. At December 31, 2021, the total derivative liability was $ 3,898,914 which included $1,019,431 for the Series C Preferred Stock, and $1,320,380 in connection with the 2015 Warrant and $ 1,559,103 in connection with the warrants for kicker shares in connection with the Series D financing. The 2015 Warrant was exercised at June 28, 2022 ending the related derivative liability. The Series C Preferred Stock became payable on demand when not converted on June 30, 2022 extinguishing the associated derivative liability. At December 31, 2022 the remaining derivative liability was $2,172,417 in connection with the warrants for kicker shares in connection with the Series D financing. The deemed dividends for the years ending December 31, 2022, and December 31, 2021 were $234,299 and $188,699, respectively. As the Company has not declared these dividends, it is required only as an item “below” the net income (loss) amount on the accompanying consolidated statements of income (loss). Preferred Stock (Undesignated) In addition to the 1,000 shares designated as Series A Preferred Stock, the 1,734,992 authorized shares designated as Series C Preferred Shares and 3,000,000 authorized shares designated as Series D Preferred Stock, the Company is authorized to issue an additional 15,265,008 shares of Preferred Stock, having a par value of $0.0001 per share. The Board of Directors of the Company has authority to issue the Preferred Stock from time to time in one or more series, and with respect to each series of the Preferred Stock, to fix and state by the resolution the terms attached to the Preferred Stock. At December 31, 2022 and December 31, 2021, there were no other shares of Preferred Stock outstanding. Separate Series; Increase or Decrease in Authorized Shares Common Stock The Company is authorized to issue 40,000,000 common shares at a par value of $0.01 per share. These shares have full voting rights. At December 31, 2022 and December 31, 2021, there were 22,246,654 and 18,091,293 common stock shares outstanding, respectively. No dividends were paid for the years ended December 31, 2022 and 2021, respectively. Preferred Rights In 2003, the Company issued “Preferred Rights” for the rights to percentages of revenues generated from the San Jose de Gracía Pilot Production Plant and received $784,500 for these rights. This has been reflected as “Preferred Rights” in stockholders’ equity in accompanying consolidated balance sheets. As of December 31, 2022, $744,500 had been repaid, leaving a current balance of $40,000 and $40,000 as of December 31, 2022 and 2021, respectively. Stock Issuances On June 28, 2022, the Company issued 2,655,361 shares of common stock upon the exercise of the 2,166,775 warrants by one warrant holder for $2.04 a share. There shares carry the antidilution provision of the Series C Preferred stock. On December 28, 2022, the Compensation Committee approved performance based common stock awards to employees, directors and consultants of the Issuer for performance based compensation. The stock awards approved were issued to each of the individuals/entities and vested 25% immediately with the remainder vesting 25% each year on December 31 for the next three years, subject to resignation or termination provisions. The awards totaled 1,500,00 shares and the Company recorded stock compensation expense of $881,250 representing value of the 25% of shares that vested in 2022. On October 18, 2021, five warrant holders exercised a total of 368,468 warrants to purchase 368,468 shares of common stock for $0.01 a share. Treasury Stock During the year ending December 31, 2022, there were no treasury stock transactions. During the year ending December 31, 2021, 504,300 treasury shares were transferred for services provided to the Company. At December 31, 2022 and 2021, 12,180 treasury shares remained held by the Company. Warrants 2022 Activity On June 28, 2022, one warrant holder exercised 2,166,775 warrants to purchase 2,655,361 shares of common stock for $2.04 a share. These shares carry the antidilution provisions of the Series C preferred Stock. At December 31, 2022, the Company had a total of 892,165 warrants outstanding. 2021 Activity On October 18, 2021, five warrant holders exercised a total of 368,468 warrant to purchase 368,468 shares of common stock for $0.01 a share. At December 2021, the Company had a total of 3,060,998 warrants outstanding. Weighted Weighted Average Average Remaining Number Exercise Contractual Intrinsic of Shares Price per share Life (Years) Value Balance at December 31, 2020 3,429,466 $ 1.30 4.33 Exercise of 2020 warrants (368,468 ) $ 0.01 Balance at December 31, 2021 3,060,998 $ 1.46 2.79 Exercise of the 2015 warrant (2,166,775 ) $ 2.04 Forfeiture of the 2015 warrant (2,058 ) $ - - Balance at December 31, 2022 892,165 $ 0.01 7.37 Exercisable at December 31, 2022 892,165 $ 0.01 7.37 - |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
STOCK BASED COMPENSATION | |
STOCK BASED COMPENSATION | NOTE 8 – STOCK BASED COMPENSATION On December 28, 2022, the Company issued 1,500,000 shares of restricted common stock to certain key employees and consultants. The shares were 25% vested at issuance and vest an additional 25% on December 28, 2023, 2024, and 2025. The shares were valued at the closing stock price of $2.35 on the date of issuance and accounted for under ASC 718. Stock compensation expense for the year ended December 31, 2022 was $881,250 representing the 25% vested portion of the total stock value. At December 31, 2022, deferred compensation totaling $2,643,750 will be expensed pro rata upon vesting. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 9 – RELATED PARTY TRANSACTIONS Restricted Stock Awards The Compensation Committee approved stock awards to employees, directors and consultants of the Company for performance based compensation. The stock awards approved were issued to each of the individuals/entities and vested 25% immediately and the remainder vest 25% each year on December 31 for the next three years, subject to resignation or termination provisions. The awards totaled 150,000 shares of which 475,000 were awarded to officers and/or directors. Dynacap Group Ltd. The Company paid $184,583 and $285,999 to Dynacap Group, Ltd., an entity formerly controlled by the current CEO of the Company, for consulting and other services during the years ended December 31, 2022 and 2021, respectively. The Company is not aware of any other material relationships or related transactions between the Company and any officers, directors or holders of more than five percent of any class of outstanding securities of the issuer. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 10 – COMMITMENTS AND CONTINGENCIES Legal Update 2014 Arbitration Proceeding filed by Goldgroup Resources Inc. On March 14, 2014, Goldgroup Resources, Inc. ("Goldgroup") filed for arbitration in the United States with the American Arbitration Association (“AAA”), seeking monetary and nonmonetary relief, and citing the Earn In/Option Agreement as the basis for its filing. On August 25, 2016, the AAA issued a ruling in favor of Goldgroup against the Company and DynaMéxico (the “Arbitration Award”). On May 9, 2019, the United States District Court for the District of Colorado (the “Colorado U.S. District Court”) confirmed the Arbitration Award. On May 20, 2021, the Company and DynaMéxico agreed to release the $1.111 million bond that had been posted, and paid an additional $4,054 in interest, in full satisfaction of the monetary portion of the Arbitration Award. Since that time, the Company has fully performed the non-monetary portion of the Arbitration Award, which included the election of a Goldgroup designee to the board of DynaMéxico. DynaResource de Mexico SA de CV Legal Update & Disclosure: On March 3, 2023, Goldgroup Resources Inc. (“Goldgroup”) filed a formal notice with the México Federal Legal Authorities, which confirmed Goldgroup’s complete withdrawal of all legal claims in Mexico and under Mexican law against DynaResource de México SA de CV. Goldgroup’s complete legal withdrawal is the result and culmination of 7 years of legal actions undertaken in Mexico by DynaMéxico. Accordingly, all matters before the courts in México with respect to DynaMéxico and Goldgroup Resources Inc. are fully resolved and are no longer subject to appeal. Consequence of the México legal ruling and the Goldgroup legal withdrawal: 1. 2. Mercuria Energy Trading S.A vs Mineras de DynaResource S.A. de C.V. In 2020, Mercuria Energy Trading, S.A. (“Mercuria”) initiated an arbitration proceeding against Mineras de Dynaresource, S.A. de C.V. (“Mineras”), arising out of the earlier-terminated supply agreement between the parties. In January 2022, The arbitration panel awarded Mercuria the sum of US$1,822,674, plus interest at 2% over the quarterly compounded USD 3- month LIBOR rate, from February 2020 forward. In August 2022, the panel also assessed costs of the arbitration proceeding against Mineras, in the aggregate amount of £ 376,232.75. DynaResource has accrued $1,000,000 for the arbitration award and related costs. The Company notes the following: since Mineras is a company of Mexican nationality, under Mexican law Mineras has the right to legally oppose the recognition and enforcement of the award to Mercuria, the assessment of any costs, and any supplemental award. Concession Taxes The Company is required to pay taxes in México in order to maintain mining concessions owned by DynaMéxico. Additionally, the Company is required to incur a minimum amount of expenditures each year for all concessions held. The minimum expenditures are calculated based upon the land area, as well as the age of the concessions. Amounts spent in excess of the minimum may be carried forward indefinitely over the life of the concessions and are adjusted annually for inflation. Based on Management’s recent business activities and current and forward plans and considering expenditures on mining concessions from 2002-2017 and continuing expenditures in current and forward activities, the Company does not anticipate that DynaMéxico will have any difficulties meeting the minimum annual expenditures for the concessions ($388 – $2,400 Mexican Pesos per hectare). DynaMéxico retains sufficient carry- forward amounts to cover over 10 years of the minimum expenditure (as calculated at the 2017 minimum, adjusted for annual inflation of 4%). Leases In addition to the surface rights held by DynaMéxico pursuant to the Mining Act Ley Minera y su Reglamento The Company leases office space for its corporate headquarters in Irving, Texas. In September 2017, the Company entered into a sixty-six-month extension of the lease through January 2023. As part of the agreement the Company received six months free rent as a finish out allowance. The Company capitalized the leasehold improvement costs and amortized them over the rent abatement period as rent expense. The Company makes tiered lease payments on the 1st of each month. Effective January 1, 2019, the Company adopted ASC 842, which requires recognition of a right-of-use asset and lease liability for all leases at the commencement date based on the present value of lease payments over the lease term. Additional qualitative and quantitative disclosures regarding the Company's leasing arrangements are also required. The Company adopted ASC 842 prospectively and elected the package of transition practical expedients that does not require reassessment of (1) whether any existing or expired contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, the Company has elected other available practical expedients to not separate lease and non-lease components, which consist principally of common area maintenance charges, for all classes of underlying assets and to exclude leases with an initial term of 12 months or less. The Company determines if a contract is or contains a lease at inception. As of December 31, 2022, the Company has two operating leases - a six- and one-half year lease for office space with a remaining term of one month and a twenty-year ground lease in association with its México mining operations with a remaining term of eleven years. Variable lease costs consist primarily of variable common area maintenance, storage parking and utilities. The Company’s leases do not have any residual value guarantees or restrictive covenants. As the implicit rate is not readily determinable for most of the Company’s lease agreements, the Company uses an estimated incremental borrowing rate to determine the initial present value of lease payments. These discount rates for leases are calculated using the Company's interest rate of promissory notes. The Company’s components of lease cost are as follows: Year Ended December 31, 2022 Operating Lease – Office Lease $ 88,043 Operating Lease – Ground Lease 91,334 Short Term Lease Costs 17,711 Variable Lease Costs 91,590 TOTAL $ 288,678 Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) – Operating Leases 10.0 Weighted Average Discount Rate – Operating Leases 12.50 % Estimated future minimum lease obligations are as follow for the years ending December 31: YEAR 2023 $ 101,499 2024 96,896 2025 99,803 2026 102,797 2027 105,881 Thereafter 579,003 Total $ 1,085,879 Less Imputed Interest (498,097 ) OPERATING LEASE LIABILITY $ 587,782 |
DERIVATIVE LIABILITIES
DERIVATIVE LIABILITIES | 12 Months Ended |
Dec. 31, 2022 | |
DERIVATIVE LIABILITIES | |
DERIVATIVE LIABILITIES | NOTE 11 - DERIVATIVE LIABILITIES Series C Preferred Stock As discussed in Note 7, the Company analyzed the embedded conversion features of the Series C Preferred Stock and determined that the conversion feature qualified as embedded derivative liability and is required to be bifurcated and accounted for as such since the host and the embedded instrument are not clearly and closely related. The Company performed a valuation of the conversion feature. In performing the valuation, the Company applied the guidance in ASC 820, “Fair Value Measurements”, In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company considered the inputs in this valuation to be level 3 in the fair value hierarchy under ASC 820 (see “Note 12”) and used an equity simulation model to determine the value of conversion feature of the Series C Preferred Stock based on the assumptions below: 2022 2021 Annual volatility rate 0 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 0.00 years 0.50 years Fair Value of common stock $ 2.44 $ 1.75 For the years ended December 31, 2022 and December 31, 2021, an active market for the Company’s common stock did not exist. Accordingly, the fair value of the Company’s common stock was estimated using a valuation model with level 3 inputs. The below table represents the change in the fair value of the derivative liability during the nine and twelve months ended December 31, 2022 and December 31, 2021. 2015 Warrant As discussed in Note 7, the Company analyzed the embedded conversion features of the Series C Preferred Stock and determined that the 2015 Warrant (issued at the same time as the Series C Preferred Stock) qualified as a derivative liability and is required to be accounted for as such. The Company performed a valuation applying the guidance in ASC 820, “Fair Value Measurements”, In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company considered the inputs in this valuation to be level 3 in the fair value hierarchy under ASC 820 (see note 12) and used an equity simulation model to determine the value of the 2015 Warrant based on the assumptions below: 2022 2021 Annual volatility rate 0 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 0.00 years 0.50 years Fair Value of common stock $ 2.44 $ 1.75 For the years ended December 31, 2022, and December 31, 2021, an active market for the Company’s common stock did not exist. Accordingly, the fair value of the Company’s common stock was estimated using a valuation model with level 3 inputs. The below table represents the change in the fair value of the derivative liability during the periods ended December 31, 2022, and December 31, 2021. Period Ended 2022 2021 Fair value of derivative (warrant), beginning of period $ 1,320,380 $ 817,613 Change in fair value of derivative (1,320,380 ) 502,767 Fair value of derivative on the date of issuance - - Fair value of derivative (warrant), end of period $ - $ 1,320,380 The 2015 Warrant was exercised on June 28, 2022. Warrants issued with the Notes convertible into Series D Preferred As discussed in Note 7, the Company analyzed the conversion features of the promissory notes convertible into Series D Preferred and determined that the 2020 warrants and remaining purchaser warrants issued with such notes qualified as a derivative liability. The fair value was required to be allocated among the notes, the notes’ conversion features, and the 2020 warrants and remaining purchaser warrants, and then remeasured at each reporting date. The Company performed a valuation of the conversion feature of the 2020 warrants and remaining purchaser warrants. In performing the valuation, the Company applied the guidance in ASC 820, “Fair Value Measurements”, In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company considered the inputs in this valuation to be level 3 in the fair value hierarchy under ASC 820 (see “Note 11”) and used an equity simulation model to determine the value of conversion feature of the Warrants issued with the notes convertible into Series D Preferred based on the assumptions below: 2022 2021 Annual volatility rate 116 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 7.37 years 8.37 years Fair Value of common stock $ 2.44 $ 1.75 For the years ended December 31, 2022 and December 31, 2021, an active market for the Company’s common stock did not exist. Accordingly, the fair value of the Company’s common stock was estimated using a valuation model with level 3 inputs. The below table represents the change in the fair value of the derivative liability during the twelve months ended December 31, 2022 and December 31, 2021. Period Ended 2022 2021 Fair value of derivative (warrants), beginning of period $ 1,559,103 $ 952,634 Exercise of warrants - (659,558 ) Change in fair value of derivative 613,314 1,266,027 Fair value of derivative (warrants), end of period $ 2,172,417 $ 1,559,103 |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 12 – FAIR VALUE OF FINANCIAL INSTRUMENTS The ASC guidance for fair value measurements and disclosure establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 Inputs Level 2 Inputs Level 3 Inputs As of December 31, 2022, and December 31, 2021, the Company’s financial assets were measured at fair value using Level 3 inputs, with the exception of cash, which was valued using Level 1 inputs. A description of the valuation of the Level 3 inputs is discussed in Note 10. Quoted Prices in Active Markets For Significant Identical Significant Other Unobservable Assets Observable Inputs Inputs Fair Value Measurement at December 31, 2022: (Level 1) (Level 2) (Level 3) Liabilities: Derivative Liabilities $ 2,172,417 — — $ 2,172,417 Totals $ 2,172,417 $ — $ — $ 2,172,417 Fair Value Measurement at December 31, 2021: Liabilities: Derivative Liabilities $ 3,898,914 — — $ 3,898,914 Totals $ 3,898,914 $ — $ — $ 3,898,914 |
REVENUE CONCENTRATION
REVENUE CONCENTRATION | 12 Months Ended |
Dec. 31, 2022 | |
REVENUE CONCENTRATION | |
REVENUE CONCENTRATION | NOTE 13 – REVENUE CONCENTRATION The Company had certain customers whose revenue individually represented 10% or more of the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable, as follows: For the years ended December 31, 2022 and 2021, one and three customers accounted for 100% of revenue, respectively. At December 31, 2022 and 2021, one and one customers accounted for 100% of accounts receivable, respectively. |
NOTES PAYABLE
NOTES PAYABLE | 12 Months Ended |
Dec. 31, 2022 | |
NOTES PAYABLE | |
NOTES PAYABLE | NOTE 14 – NOTES PAYABLE In June 2018, the Company entered into financing agreements for the unpaid mining concession taxes on the Francisco Arturo mining concession for the year ended December 31, 2017 and the period ending June 30, 2018 in the amount of $1,739,392. The Company paid an initial 20% payment of $347,826 and financed the balance over 36 months at 22%. In February 2019, the Company entered into a financing agreement for unpaid mining concession taxes on the Francisco Arturo mining concession for the year ended December 31, 2018 in the amount of $335,350. The Company paid an initial 20% payment of $67,070 and financed the balance over 36 months at an interest rate of 22%. In June 2018, the Company applied for a reduction of the Francisco Arturo mining concession, from 69,121 hectares to 3,280 hectares. On July 31, 2018, the application for reduction was approved and the Company paid an initial amount of 985,116 MNP (Pesos), for the second semester 2018 mining concessions taxes on the reduced Francisco Arturo mining concession. The Company continues to accrue an amount of $22,500 (USD) per semester on the reduced Francisco Arturo mining concession. As of June 2019, the Company ceased making monthly payments on the above noted Francisco Arturo concession notes and has petitioned the Hacienda for a reduction in the liability equal to the reduction in the Francisco Arturo concession above. For financial reporting purposes the Company continues to carry all notes at unpaid principal amount and accrues interest on a monthly basis. At December 31, 2022, $1,572,972 of accrued interest on the notes was included in accrued liabilities on the accompanying consolidated balance sheet. In October 2019, the Company entered into a financing agreement for unpaid mining concession taxes on the San Jose de Gracia core mining concessions in the amount of $ 299,474. The Company paid an initial 20% payment of $59,895 and financed the balance over 36 months at an interest rate of 22%. The following is a summary of the transaction during the years ended December 31, 2022, and December 31, 2021: Balance December 31, 2020 $ 2,081,435 Exchange Rate Adjustment (57,504 ) 2021 Principal Payments (61,406 ) Balance December 31, 2021 1,962,525 Exchange Rate Adjustment 100,424 2022 Principal Payments (94,698 ) Balance December 31, 2022 $ 1,968,251 |
REVOLVING CREDIT LINE FACILITY
REVOLVING CREDIT LINE FACILITY | 12 Months Ended |
Dec. 31, 2022 | |
CONVERTIBLE PROMISSORY NOTES | |
REVOLVING CREDIT LINE FACILITY | NOTE 15 – REVOLVING CREDIT LINE FACILITY On February 4, 2021 Mineras de DynaResource SA de CV (“Seller”) entered into a Revolving Credit Line Facility and Commercial Offtake Agreement (the “RCL”), with a commercial buyer. The RCL was assigned from Mineras to DynaMexico in March 2022 and in December 2022 it was extended for one year. Under the terms of the RCL: · The Company will deliver 100% of its produced concentrates to the buyer and provider of the RCL, through December 31, 2022; unless extended by the Company; · An initial RCL was established by buyer in the amount of $3.75M USD; · At May 1, 2021, the RCL increased to an amount equal to 80% of prior 3 month’s revenue; · Each successive month, the RCL shall be adjusted according to the company’s prior 3 month’s revenue; · The RCL shall never be less than $3.75M USD; · The RCL will be interest free for 45 days; · The RCL is to be repaid through deliveries of Concentrates or Cash within 120 days; The RCL is included under Customer Advances on the consolidate balance sheet, Deposits under Revolving Credit Line Facility Under the terms of the RCL, Mineras de DynaResource received the following advances from the buyer: (1) $2.50M advance on February 4, 2021. Settled on March 26, 2021. (2) $3.75M advance on March 30, 2021. Settled on May 12, 2021. (3) $3.75M advance on May 12, 2021. Settled on June 16, 2021. (4) $6.75M advance on June 18, 2021. Settled on August 5, 2021. (5) $8.25M advance on August 9, 2021. Settled on September 27, 2021 (6) $8.25M advance on September 29, 2021. Settled on November 17, 2021 (7) $8.25M advance on November 19, 2021. Settled on December 30, 2021 (8) $9.25 M advance on December 30, 2021. Settled on February 25, 2022 (9) $8.175M advance on February 25, 2022. Settled on March 30, 2022 (10) $7.875M advance on March 30, 2022. Settled on May 13, 2022 (11) $8.875M advance on May 19, 2020. Settled on June 27, 2022 (12) $8.75M advance on June 28, 2022. Settled on August 15, 2022 (13) $7.80M advance on August 19, 2022. Settled on September 28, 2022 (14) $7.7375M advance on September 29, 2022. Settled on November 15, 2022 (15) $8.25M advance on November 14, 2022. Settled on December 28, 2022 (16) $9.35 advance on December 28, 2022. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 16 – SUBSEQUENT EVENTS On January 31, 2023, the Company entered in a 52 month extension on its office lease where the Company is headquartered in Irving, Texas. The term of the new lease commences on or about April 15, 2023 or when the finish out of the additional two offices is complete, and expires 52 months later. The new lease requires monthly lease payments of approximately $10,000 after the four-month rent abatement period. The Company has evaluated events from December 31, 2022, through the date whereupon the consolidated financial statements were issued, and has described below the events subsequent to the end of the period. |
NATURE OF ACTIVITIES AND SIGN_2
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Activities, History and Organization | DynaResource, Inc. (The “Company”, “DynaResource”, or “DynaUSA”) was organized September 28, 1937, as a California corporation under the name of West Coast Mines, Inc. In 1998, the Company re-domiciled to Delaware and changed its name to DynaResource, Inc. The Company is in the business of acquiring, investing in, and developing precious metal properties, and the production of precious metals. In 2000, the Company formed a wholly owned subsidiary, DynaResource de México S.A. de C.V., chartered in México (“DynaMéxico”). This Company was formed to acquire, invest in and develop resource properties in México. DynaMéxico owns a portfolio of mining concessions that currently includes its interests in the San José de Gracía Project (“SJG”) in northern Sinaloa State, México. The SJG District covers 9,920 hectares (24,513 acres) on the west side of the Sierra Madre mountain range. DynaUSA currently owns 80% of the outstanding capital of DynaMéxico, 79% directly and 1% held by the current CEO on behalf of the Company, in compliance with Mexican law. DynaMéxico currently holds 20% of the Shares of DynaMéxico as treasury shares, after complete foreclosure and recovery of those shares on February 20, 2020 from Goldgroup Resources Inc., a wholly owned subsidiary of Goldgroup Mining Inc. Vancouver, BC (“Goldgroup”). In 2005, the Company formed DynaResource Operaciones de San Jose De Gracía S.A. de C.V. (“DynaOperaciones”) as an operating subsidiary to manage registered employees, and acquired effective control of Mineras de DynaResource, S.A. de C.V. (formerly Minera Finesterre S.A. de C.V., “DynaMineras”). In 2020 the Company moved its registered employees from DynaOperaciones to DynaMexico in compliance with changes in Mexican employment law. The Company owns 100% of DynaMineras and 100% of DynaOperaciones. The Company elected to become a voluntary reporting issuer in Canada in order to avail itself of Canadian regulations regarding reporting for mining properties and, more specifically, National Instrument 43-101 (“NI 43-101”). This regulation sets forth standards for reporting resources in a mineral property and is a standard recognized in the mining industry. |
Reclassifications and Adjustments | Certain financial statement reclassifications have been made to prior period balances to reflect the current period’s presentation format, such reclassifications had no impact on the Company’s consolidated statements of income or consolidated statements of cash flows and had no material impact on the Company’s consolidated balance sheets. |
Significant Accounting Policies | The consolidated financial statements and notes are representations of the Company’s management which is responsible for their integrity and objectivity. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items that: 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce consolidated financial statements which present fairly the consolidated financial condition, results of operations and cash flows of the Company for the respective periods presented. |
Basis of Presentation | The Company prepares its consolidated financial statements on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States. |
Use of Estimates | In order to prepare consolidated financial statements in conformity with accounting principles generally accepted in the United States, management must make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and determines whether contingent assets and liabilities, if any, are disclosed in the consolidated financial statements. The ultimate resolution of issues requiring these estimates and assumptions could differ significantly from the resolution currently anticipated by management and on which the consolidated financial statements are based. |
Principles of Consolidation | The consolidated financial statements include the accounts of DynaResource, Inc., as well as DynaResource de México, S.A. de C.V., DynaResource Operaciones S.A. de C.V. and Mineras de DynaResource S.A. de C.V. All significant inter-company transactions have been eliminated. All amounts are presented in U.S. Dollars unless otherwise stated. |
Cash and Cash Equivalents | The Company considers all highly liquid debt instruments with an original maturity of three months or less to be cash equivalents. At times, cash balances may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. As of December 31, 2022, the Company had $ 18,375,699 of deposits in U.S. Banks in excess of the FDIC limit. The Company does not believe it is at a risk of loss on cash. |
Accounts Receivable and Allowances for Doubtful Accounts | The allowance for accounts receivable is recorded when receivables are considered to be doubtful of collection. As of December 31, 2022, and 2021, respectively, no allowance has been made. During the year ended December 31, 2021 the Company recorded a $381,871 bad debt write off of receivables from a former customer of the Company. At, December 31, 2022 management believes all accounts receivable are fully collectable. |
Inventory | Inventories are carried at the lower of cost or net realizable value and consist of mined tonnage, gravity and flotation concentrates, and gravity tailings or flotation feed material. The inventories were $2,720,811 and $2,110,203 as of December 31, 2022 and December 31, 2021, respectively. |
Foreign Tax Receivable | Foreign Tax Receivable is comprised of recoverable value-added taxes (“IVA”) charged by the Mexican government on goods and services rendered to the company in Mexico and paid by the company. Under certain circumstances, these taxes are recoverable by filing a tax return and application for reimbursement. IVA amounts charged to and paid by the company are recorded and carried as receivables until the funds are collected by the company. The total amounts of the IVA receivable as of December 31, 2022 and December 31, 2021 were $9,355,863 and $4,742,180, respectively. In 2022, the Company recovered $403,308 of the IVA receivable. |
Exploration Stage | According to Section 1300 of Regulation S-K, the Registrant is an exploration stage issuer with an exploration stage property since it does not have proven and probable reserves as defined in Section 1300 and does not have a preliminary or final feasibility study. |
Property and Equipment | Substantially all mine development costs, including design, engineering, mine construction, and installation of equipment are expensed as incurred as the Company has not established proven and probable reserves on any of its properties. Only certain types of mining equipment which has alternative uses or significant salvage value, may be capitalized without proven and probable reserves. Depreciation is computed using the straight-line method. Office furniture and equipment are being depreciated on a straight-line method over estimated economic lives ranging from 3 to 5 years. Leasehold improvements, which relate to the Company's corporate office, are being amortized over the term of the lease of 10 years. Design, Construction, and Development Costs: |
Mineral Properties Interests | Mineral property interests include acquired interests in development and exploration stage properties, which are considered tangible assets. The amount capitalized relating to a mineral property interest represents its fair value at the time of acquisition. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, such as with the San Jose de Gracía Property, capitalized costs and mineral property interests are amortized using the straight-line method once proven and probable reserves are extracted. As of December 31, 2022, the mining interests have been in the pilot production stage and therefore, no amortization has been expensed. Mining properties consist of 33 mining concessions covering approximately 9,920 hectares at the San Jose de Gracía property (“SJG”), the basis of which will be amotized once proven and probable reserves are extracted on the unit of production method based on estimated recoverable resources. If it is determined that the deferred costs related to a property are not recoverable over its productive life, those costs will be written down to fair value as a charge to operations in the period in which the determination is made. The amounts at which mineral properties and the related costs are recorded do not necessarily reflect present or future values. Impairment of Assets: For operating mines, recoverability is measured by comparing the undiscounted future net cash flows to the net book value. When the net book value exceeds future net undiscounted cash flows, an impairment loss is measured and recorded based on the excess of the net book value over fair value. Fair value for operating mines is determined using a combined approach, which uses a discounted cash flow model for the existing operations and a market approach for the fair value assessment of exploration land claims. Future cash flows are estimated based on quantities of recoverable mineralized material, expected gold and silver prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine plans. The term "recoverable mineralized material" refers to the estimated amount of gold or other commodities that will be obtained after considering losses during processing and treatment of mineralized material. In estimating future cash flows, assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of future cash flows from other asset groups. The Company's estimates of future cash flows are based on numerous assumptions and it is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold, silver and other commodity prices, production levels and costs and capital are each subject to significant risks and uncertainties. The recoverability of the book value of each property is assessed annually for indicators of impairment such as adverse changes to any of the following: · estimated recoverable ounces of gold, silver or other precious minerals; · estimated future commodity prices; · estimated expected future operating costs, capital expenditures and reclamation expenditures. A write-down to fair value will be recorded when the expected future cash flow is less than the net book value of the property or when events or changes in the property indicate that carrying amounts are not recoverable. This analysis is completed as needed, and at least annually. As of the date of this filing, no events have occurred that would require write-down of any assets. As of December 31, 2022, and 2021, no indications of impairment existed. |
Asset Retirement Obligation | As the Company is not obligated to remediate the mining properties, no Asset Retirement Obligation (“ARO”) has been established. Changes in regulations or laws, any instances of non-compliance with laws or regulations that result in fines, or any unforeseen environmental contamination could result in a material impact to the amounts charged to operations for reclamation and remediation. |
Transactions in and Translations of Foreign Currency | The functional currency for the subsidiaries of the Company is the Mexican Peso. As a result, the financial statements of the subsidiaries have been translated from Mexican Pesos into U.S. dollars using (i) year-end exchange rates for balance sheet accounts, and (ii) the weighted average exchange rate of the reporting period for all income statement accounts. Foreign currency translation gains and losses are reported as a separate component of stockholders’ equity and comprehensive income (loss). The financial statements of the subsidiaries should not be construed as representations that Mexican Pesos have been, could have been or may in the future be converted into U.S. dollars at such rates or any other rates. Relevant exchange rates used in the preparation of the financial statements for the subsidiaries are as follows for the years ended December 31, 2022 and 2021 (Mexican Pesos per one U.S. dollar): Dec 31, 2022 Dec 31, 2021 Current exchange rate Pesos 19.48 20.48 Weighted average exchange rate for the period ended Pesos 20.11 20.29 The Company recorded currency transaction gains (losses) of $58,426 for the year ended December 31, 2022 and $247,712 for the year ended December 31, 2021. |
Income Taxes | The Company accounts for income taxes under ASC 740 “Income Taxes” |
Uncertain Tax Position | The Company is subject to income taxes in the U.S. and other foreign jurisdictions, with respect to which some of the outcome is uncertain. The evaluation of the Company’s uncertain tax positions involves significant judgment in the interpretation and application of GAAP and complex domestic and international tax laws. We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that it becomes uncertain based upon one of the following conditions: (1) the tax position is not "more likely than not" to be sustained, (2) the tax position is "more likely than not" to be sustained, but for a lesser amount, or (3) the tax position is "more likely than not" to be sustained, but not in the financial period in which the tax position was originally taken. For purposes of evaluating whether or not a tax position is uncertain, (1) we presume the tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information; (2) the technical merits of a tax position are derived from authorities such as legislation and statutes, legislative intent, regulations, rulings and case law and their applicability to the facts and circumstances of the tax position; and (3) each tax position is evaluated without consideration of the possibility of offset or aggregation with other tax positions taken. Although management believes the Company’s reserves are reasonable, no assurance can be given that the final outcome of these uncertainties will not be different from that which is reflected in the Company’s reserves. A number of years may elapse before a particular uncertain tax position is audited and finally resolved or when a tax assessment is raised. The number of years subject to tax assessments varies depending on the tax jurisdiction. Any tax benefit that is or has been reserved because of a failure to meet the "more likely than not" recognition threshold would be recognized in income tax expense in the first interim period when the uncertainty disappears under any one of the following conditions: (1) the tax position is "more likely than not" to be sustained, (2) the tax position, amount, and/or timing is ultimately settled through negotiation or litigation, or (3) the statute of limitations for the tax position has expired. Refer to Note 6. |
Comprehensive Income (Loss) | ASC 220 “Comprehensive Income” |
Revenue Recognition | The Company accounts for revenue recognition under ASC 606 “ Revenue from contracts with customers The amount of revenue recognized is initially recorded on a provisional basis based on the contract price and the estimated metal quantities based on assay data. The revenue is adjusted upon final settlement of the sale. The chief risk associated with the recognition of sales on a provisional basis is the fluctuations between the estimated quantities of precious metals based on the initial assay and the actual recovery from treatment and processing. As of December 31, 2022, there are $9,350,000 in customer advances for payments received during the period for contracts expected to be settled in 2023. During the years ended December 31, 2022, and December 31, 2021, there was $9,250,000 and $1,500,000 of revenue recognized during the period from customer deposit liabilities (deferred contract revenue) from prior periods, and $0 of customer deposits refunded to the customer due to order cancellation. As of and for the year ended December 31, 2022, and December 31, 2021, there are no deferred contract costs or commissions. We have elected to account for shipping and handling costs as fulfillment costs after the customer obtains control of the concentrate. |
Fair Value of Financial Instruments | The Company’s financial instruments consist of cash, receivables, payables and installment notes payable. The carrying amount of cash, accounts receivable and accounts payable approximates fair value because of the short-term nature of these items. The carrying amount of installment notes payable debt approximates fair value due to the relationship between the interest rate on installment notes payable debt and the Company’s incremental risk adjusted borrowing rate. |
Earnings Per Share | Earnings per share are calculated in accordance with ASC 260 “ Earnings per Share The Company had warrants outstanding to purchase 892,165 shares of common stock at December 31, 2022 which upon exercise, would result in the issuance of 892,165 shares of common stock. These warrants are exercisable at $0.01 per share The Company’s Series C Preferred Stock including outstanding dividends is convertible into 2,643,082 shares of Common Stock at December 31, 2022. The Company’s Series D Preferred including outstanding dividends is convertible into 790,400 shares of common stock at December 31, 2022. The Company had warrants outstanding (the 2015 Warrant) to purchase 2,657,895 shares of common stock at December 31, 2021 which upon exercise, would result in the issuance of 3,060,998 shares of common stock. Of these warrants 2,168,745 were exercisable at $2.04 per share and 892,165 were exercisable at $0.01 per share. The Company also had convertible debt instruments as of December 31, 2021 which, upon conversion at $2.50 per share, would result in the issuance of 217,312 shares of common stock. Years ended December 31 2022 2021 Net income (loss) attributable to common shareholders $ 6,744,654 $ 8,345,664 Shares: Weighted average number of common shares outstanding, Basic 19,456,765 17,797,528 Weighted average number of common shares outstanding, Diluted 22,890,246 17,797,528 Basic income (loss) per share $ 0.33 $ 0.47 Diluted income (loss) per share $ 0.29 $ 0.47 Diluted Earnings Per Share is calculated as follows: Dec 31, 2022 Net income attributable to common shareholders $ 6,451,503 Deemed Dividends of Series C Preferred Stock 173,499 Deemed Dividends of Series D Preferred Stock 60,800 Adjusted Diluted Earnings $ 6,685,802 Weighted average number of share outstanding - Basic 19,456,765 Series C Preferred Stock Common Stock Equivalent 2,643,082 Series D Preferred Stock Common Stock Equivalent 790,400 Weighted average number of share outstanding - Diluted 22,890,246 Diluted Earnings Per Share $ 0.29 At December 31, 2022, 892,165 of potentially dilutive common stock related to outstanding warrants were excluded from the diluted earnings per share calculation as the net income impact of the converted shares would cause earnings per share to increase, therefore their effect would be antidilutive. At December 31, 2021, 2,168,833 shares of potentially dilutive common stock related to outstanding stock warrants and 217,312 shares of potentially dilutive common stock related to convertible debt were excluded from the diluted earnings per share calculation, using the treasury stock method, because the exercise and conversion prices exceeded the average stock price and therefore their effect would be anti-dilutive. In addition, at December 31, 2021, 892,165 of potentially dilutive common stock related to outstanding warrants were excluded from the diluted earnings per share calculation as the net income impact of the converted shares would cause earnings per share to increase, therefore their effect would be antidilutive. |
Related Party Transactions | FASB ASC 850 "Related Party Disclosures" |
NATURE OF ACTIVITIES AND SIGN_3
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | |
Exchange Rates | Dec 31, 2022 Dec 31, 2021 Current exchange rate Pesos 19.48 20.48 Weighted average exchange rate for the period ended Pesos 20.11 20.29 |
Schedule of Earnings Per Share | Years ended December 31 2022 2021 Net income (loss) attributable to common shareholders $ 6,744,654 $ 8,345,664 Shares: Weighted average number of common shares outstanding, Basic 19,456,765 17,797,528 Weighted average number of common shares outstanding, Diluted 22,890,246 17,797,528 Basic income (loss) per share $ 0.33 $ 0.47 Diluted income (loss) per share $ 0.29 $ 0.47 |
Schedule of Diluted Earnings Per Share | Dec 31, 2022 Net income attributable to common shareholders $ 6,451,503 Deemed Dividends of Series C Preferred Stock 173,499 Deemed Dividends of Series D Preferred Stock 60,800 Adjusted Diluted Earnings $ 6,685,802 Weighted average number of share outstanding - Basic 19,456,765 Series C Preferred Stock Common Stock Equivalent 2,643,082 Series D Preferred Stock Common Stock Equivalent 790,400 Weighted average number of share outstanding - Diluted 22,890,246 Diluted Earnings Per Share $ 0.29 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INVENTORIES | |
Inventories | 2022 2021 Mined Tonnage $ 2,610,116 $ 2,042,633 Gold-Silver Concentrates 110,695 67,570 Total Inventories $ 2,720,811 $ 2,110,203 |
PROPERTY (Tables)
PROPERTY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY | |
Property | 2022 2021 Leasehold improvements $ 9,340 $ 9,340 Office equipment 31,012 31,012 Office furniture and fixtures 78,802 78,802 Sub-total 119,154 119,154 Less: Accumulated depreciation (119,154 ) (116,425 ) Total Property $ - $ 2,729 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAXES | |
Deferred Tax Assets | December 31, December 31, 2022 2021 Federal Net Operating Loss Carryforwards $ 509,711 $ 4,653,402 Foreign Net Operating Loss Carryforwards 2,459,782 7,674,197 Other 917 862 Total Deferred Tax Asset 2,970,410 12,328,461 Less Valuation Allowance - (12,328,461 ) Net Deferred Tax Asset $ 2,970,410 $ - |
Summary of Pre-Tax Income (Loss) | December 31, December 31, 2022 2021 Domestic $ 3,221,618 $ (10,064,644 ) Foreign 883,774 18,627,977 Total $ 4,105,392 $ 8,563,333 |
Income Tax Provision | December 31, December 31, 2022 2021 Current income taxes Federal $ 220,000 $ - State - - Foreign 170,000 28,970 Total current income taxes $ 390,000 $ 28,970 Deferred income taxes Federal $ (510,629 ) $ - State - - Foreign (2,459,781 ) - Total deferred income taxes $ (2,970,410 ) - Total income tax expense (benefit) $ (2,580,410 ) $ 28,970 December 31, December 31, 2022 2021 Tax Expense at statutory federal rate of 21% $ 808,560 $ 1,798,300 Permanent Differences 927,343 501,707 Foreign Rate Differential 56,580 1,103,990 GILTI NOL Impact 145,913 - GILTI NOL Adjustment – Previously Offset by Valuation Allowance 7,781,388 - Change in Valuation Allowance (12,328,462 ) $ (1,143,877 ) Other 28,268 $ (2,231,150 ) Income tax expense (benefit) $ (2,580,410 ) $ 28,970 |
Schedule of Cumulative Net Operating Loss Carryforward | December 31, December 31, 2022 2021 United States Expiring 2029 to 2037 $ - $ 16,400,000 United States Indefinite Limited to 80% 2,800,000 2,700,000 Foreign NOLs 8,200,000 12,500,000 $ 11,000,000 $ 31,600,000 |
STOCKHOLDERS EQUITY (Tables)
STOCKHOLDERS EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
STOCKHOLDERS EQUITY | |
Warrant Activity | Weighted Weighted Average Average Remaining Number Exercise Contractual Intrinsic of Shares Price per share Life (Years) Value Balance at December 31, 2020 3,429,466 $ 1.30 4.33 Exercise of 2020 warrants (368,468 ) $ 0.01 Balance at December 31, 2021 3,060,998 $ 1.46 2.79 Exercise of the 2015 warrant (2,166,775 ) $ 2.04 Forfeiture of the 2015 warrant (2,058 ) $ - - Balance at December 31, 2022 892,165 $ 0.01 7.37 Exercisable at December 31, 2022 892,165 $ 0.01 7.37 - |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
Lease Cost | The Company’s components of lease cost are as follows: Year Ended December 31, 2022 Operating Lease – Office Lease $ 88,043 Operating Lease – Ground Lease 91,334 Short Term Lease Costs 17,711 Variable Lease Costs 91,590 TOTAL $ 288,678 Weighted average remaining lease term and weighted average discount rate are as follows: Weighted Average Remaining Lease Term (Years) – Operating Leases 10.0 Weighted Average Discount Rate – Operating Leases 12.50 % Estimated future minimum lease obligations are as follow for the years ending December 31: YEAR 2023 $ 101,499 2024 96,896 2025 99,803 2026 102,797 2027 105,881 Thereafter 579,003 Total $ 1,085,879 Less Imputed Interest (498,097 ) OPERATING LEASE LIABILITY $ 587,782 |
DERIVATIVE LIABILITIES (Tables)
DERIVATIVE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
DERIVATIVE LIABILITIES | |
Change in the Fair Value of the Derivative Liability | 2022 2021 Annual volatility rate 0 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 0.00 years 0.50 years Fair Value of common stock $ 2.44 $ 1.75 2022 2021 Annual volatility rate 0 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 0.00 years 0.50 years Fair Value of common stock $ 2.44 $ 1.75 Period Ended 2022 2021 Fair value of derivative (warrant), beginning of period $ 1,320,380 $ 817,613 Change in fair value of derivative (1,320,380 ) 502,767 Fair value of derivative on the date of issuance - - Fair value of derivative (warrant), end of period $ - $ 1,320,380 The 2015 Warrant was exercised on June 28, 2022. Warrants issued with the Notes convertible into Series D Preferred 2022 2021 Annual volatility rate 116 % 147 % Risk free rate 4.41 % 0.73 % Remaining Term 7.37 years 8.37 years Fair Value of common stock $ 2.44 $ 1.75 Period Ended 2022 2021 Fair value of derivative (warrants), beginning of period $ 1,559,103 $ 952,634 Exercise of warrants - (659,558 ) Change in fair value of derivative 613,314 1,266,027 Fair value of derivative (warrants), end of period $ 2,172,417 $ 1,559,103 Period Ended 2022 2021 Fair value of derivative (stock), beginning of period $ 1,019,431 $ 601,313 Change in fair value of derivative (1,019,431 ) 418,118 Fair value of derivative on the date of issuance - - Fair value of derivative (stock), end of period $ - $ 1,019,431 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Fair Value Measurement | Quoted Prices in Active Markets For Significant Identical Significant Other Unobservable Assets Observable Inputs Inputs Fair Value Measurement at December 31, 2022: (Level 1) (Level 2) (Level 3) Liabilities: Derivative Liabilities $ 2,172,417 — — $ 2,172,417 Totals $ 2,172,417 $ — $ — $ 2,172,417 Fair Value Measurement at December 31, 2021: Liabilities: Derivative Liabilities $ 3,898,914 — — $ 3,898,914 Totals $ 3,898,914 $ — $ — $ 3,898,914 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
NOTES PAYABLE | |
Notes Payable | The following is a summary of the transaction during the years ended December 31, 2022, and December 31, 2021: Balance December 31, 2020 $ 2,081,435 Exchange Rate Adjustment (57,504 ) 2021 Principal Payments (61,406 ) Balance December 31, 2021 1,962,525 Exchange Rate Adjustment 100,424 2022 Principal Payments (94,698 ) Balance December 31, 2022 $ 1,968,251 |
NATURE OF ACTIVITIES AND SIGN_4
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | ||
Current Exchange Rate | 19.48 | 20.48 |
Weighted Average Exhange Rate for the Period | 20.11 | 20.29 |
NATURE OF ACTIVITIES AND SIGN_5
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | ||
Net income (loss) attributable to common shareholders | $ 6,744,654 | $ 8,345,664 |
Shares: | ||
Weighted average number of common shares outstanding, Basic | 19,456,765 | 17,797,528 |
Diluted weighted average number of common shares outstanding, | 22,890,246 | 17,797,528 |
Basic earnings (loss) per share | $ 0.33 | $ 0.47 |
Diluted earnings (loss) per share | $ 0.29 | $ 0.47 |
NATURE OF ACTIVITIES AND SIGN_6
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Details 2) | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES | |
Net income attributable to common sharholders | $ | $ 6,451,503 |
Deemed Dividends of Series C Preferred Stock | $ | 173,499 |
Deemed Dividends of Series D Preferred Stock | $ | 60,800 |
Adjusted Diluted Earnings | $ | $ 6,685,802 |
Weighted average number of share outstanding - Basic | shares | 19,456,765 |
Series C Perferred Stock Common Stock Equivalent | shares | 2,643,082 |
Series D Perferred Stock Common Stock Equivalent | shares | 790,400 |
Weighted average number of share outstanding - Diluted | shares | 22,890,246 |
Diluted earnings (loss) per share | $ / shares | $ 0.29 |
NATURE OF ACTIVITIES AND SIGN_7
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Amortized of lease term | 10 years | |
Bank deposite excess of FDIC limit | $ 18,375,699 | |
Potentially dilutive common stock related to outstanding stock warrants | 892,165 | 2,168,833 |
Potentially dilutive common stock related to convertible debt | 892,165 | |
IVA Receivable | $ 9,355,863 | $ 4,742,180 |
Bad debt write off of receivables | 381,871 | |
Inventories | 2,720,811 | 2,110,203 |
Currency transaction gains (losses) | 58,426 | $ 247,712 |
Customer deposit liabilities for payment received in advance | $ 9,350,000 | |
Warrants outstanding | 892,165 | 2,657,895 |
Deferred contract revenue | $ 9,250,000 | $ 1,500,000 |
Common stock issued | 892,165 | 3,060,998 |
Exercise price | $ 0.01 | |
Minimum | Leasehold improvements [Member] | ||
Property estimate useful life | 3 years | |
Maximum | Leasehold improvements [Member] | ||
Property estimate useful life | 5 years | |
Warrant | ||
Warrant exercisable | 2,168,745 | 892,165 |
Warrant exercisable price | $ 2.04 | $ 0.01 |
Conversion At Valuations | $ 2.50 | |
Issuance shares of common stock | 217,312 | |
Series C Preferred Stock | ||
Outstanding dividends convertible into shares of common Stock | 2,643,082 | |
Series D Preferred Stock | ||
Outstanding dividends convertible into shares of common Stock | 790,400 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Total Inventories | $ 2,720,811 | $ 2,110,203 |
Mined Tonnage [Member] | ||
Total Inventories | 2,610,116 | 2,042,633 |
GoldSilver Concentrates [Member] | ||
Total Inventories | $ 110,695 | $ 67,570 |
PROPERTY (Details)
PROPERTY (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Less: Accumulated Depreciation | $ (119,154) | $ (116,425) |
Total Property | 0 | 2,729 |
property and plant [Member] | ||
Leasehold Improvements | 9,340 | 9,340 |
Office Equipment | 31,012 | 31,012 |
Office Furniture and Fixtures | 78,802 | 78,802 |
Sub-total | 119,154 | 119,154 |
Less: Accumulated Depreciation | (119,154) | (116,425) |
Total Property | $ 0 | $ 2,729 |
PROPERTY (Details Narrative)
PROPERTY (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
PROPERTY | ||
Depreciation expense | $ 2,729 | $ 3,249 |
MINING CONCESSIONS (Details Nar
MINING CONCESSIONS (Details Narrative) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
MINING CONCESSIONS | ||
Total mining concessions | $ 4,132,678 | $ 4,132,678 |
CONVERTIBLE PROMISSORY NOTES (D
CONVERTIBLE PROMISSORY NOTES (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2019 | Feb. 28, 2019 | Jun. 30, 2018 | Dec. 31, 2022 | Dec. 31, 2021 | |
Principal amount | $ 59,895 | $ 67,070 | $ 347,826 | ||
2013 and 2014 [Member] | Additional Note Agreements [Member] | Notes Payable - Series I [Member] | |||||
Notes payable | $ 199,808 | $ 250,000 | |||
Simple interest rate | 12.50% | 12.50% | |||
Maturity date | Dec. 31, 2015 | ||||
Notes payable outstanding amount | $ 87,374 | ||||
Common shares received upon conversion, to purchase additional common shares | $ 7.50 | ||||
April and May 2013 [Member] | Notes Payable - Series I [Member] | |||||
Simple interest rate | 12.50% | ||||
Maturity date | Dec. 31, 2015 | ||||
Notes payable outstanding amount | $ 455,905 | ||||
Common shares received upon conversion, to purchase additional common shares | $ 7.50 | ||||
Preferred shares converted amount | $ 340,000 | ||||
Proceed from debt instrument | 1,155,000 | ||||
Principal amount | $ 1,495,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Other | $ 917 | $ 862 |
Total Deferred Tax Asset | 2,970,410 | 12,328,461 |
Less Valuation Allowance | 0 | (12,328,461) |
Net Deferred Tax Asset | 2,970,410 | 0 |
Federal [Member] | ||
Net Operating Loss Carryforwards | 509,711 | 4,653,402 |
Foreign [Member] | ||
Net Operating Loss Carryforwards | $ 2,459,782 | $ 7,674,197 |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
INCOME TAXES | ||
Domestic | $ 3,221,618 | $ (10,064,644) |
Foreign | 883,774 | 18,627,977 |
Income (loss) before taxes | $ 4,105,392 | $ 8,563,333 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current | ||
Federal | $ 220,000 | $ 0 |
State | 0 | 0 |
Foreign | 170,000 | 28,970 |
Total current income taxes | 390,000 | 28,970 |
Deferred and Other | ||
Federal | (510,629) | 0 |
State | 0 | 0 |
Foreign | (2,459,781) | 0 |
Total deferred income taxes | (2,970,410) | 0 |
Total tax expense (benefit) | $ (2,580,410) | $ 28,970 |
INCOME TAXES (Details 3)
INCOME TAXES (Details 3) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
INCOME TAXES | ||
Tax Expense at statutory federal rate | $ 808,560 | $ 1,798,300 |
Permanent Differences | 927,343 | 501,707 |
Foreign tax rate differential | 56,580 | 1,103,990 |
GILTI NOL Impact | 145,913 | 0 |
GILTI NOL Adjustment - Previously Offset by Valuation Allowance | 7,781,388 | 0 |
Change in valuation allowance | (12,328,462) | (1,143,877) |
Other | 28,268 | (2,231,150) |
Income tax expense (benefit) | $ (2,580,410) | $ 28,970 |
INCOME TAXES (Details 4)
INCOME TAXES (Details 4) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Net operating loss carry forward | $ 11,000,000 | $ 31,600,000 |
United States Expiring 2029 to 2037 | ||
Net operating loss carry forward | 0 | 16,400,000 |
United States Indefinite Limited to 80Percent | ||
Net operating loss carry forward | 2,800,000 | 2,700,000 |
Foreign NOLs | ||
Net operating loss carry forward | $ 8,200,000 | $ 12,500,000 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) $ in Millions | Dec. 31, 2022 USD ($) |
INCOME TAXES | |
Pre-tax | $ 2.8 |
Net operating loss carry-forward | 11 |
Foreign net operating losses | $ 8.2 |
STOCKHOLDERS EQUITY (Details)
STOCKHOLDERS EQUITY (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
STOCKHOLDERS EQUITY | ||
Warrants, Outstanding, Beginning Balance | 3,060,998 | 3,429,466 |
Warrants, Exercised | (2,166,775) | (368,468) |
Warrants, Forfeited | (2,058) | |
Warrants, Outstanding, Ending Balance | 892,165 | 3,060,998 |
Warrant, Exercisable | 892,165 | |
Weighted Average Exercise Price, Outstanding, Beginning Balance | $ 1.46 | $ 1.30 |
Weighted Average Exercise Price, Exercised | 2.04 | 0.01 |
Weighted Average Exercise Price, Forfeited | 0 | |
Weighted Average Exercise Price, Outstanding, Ending Balance | 0.01 | $ 1.46 |
Weighted AverageExercise Price Exercisable at December 31, 2021 | $ 0.01 | |
Weighted Average Remaining Contractual Life, Outstanding, Beginning Balance | 2 years 9 months 14 days | 4 years 3 months 29 days |
Weighted Average Remaining Contractual Life, Outstanding, End Balance | 7 years 4 months 13 days | 2 years 9 months 15 days |
Weighted Average Remaining Contractual Life, Outstanding, Exercisable | 7 years 4 months 13 days | |
Intrinsic Value, Granted | $ 0 | $ 0 |
Intrinsic Value, Forfeited | 0 | $ 0 |
Intrinsic Value, Excercisable | $ 0 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) | 1 Months Ended | 12 Months Ended | ||||||||||
Oct. 07, 2021 USD ($) integer $ / shares | Dec. 28, 2022 USD ($) shares | Jun. 28, 2022 shares | Oct. 31, 2021 USD ($) | Oct. 18, 2021 shares | Oct. 31, 2019 USD ($) | Feb. 28, 2019 USD ($) | Jun. 30, 2018 USD ($) | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) shares | May 14, 2020 $ / shares | |
Capital stock authorized issue | 60,001,000 | |||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||||||
Preferred stock, shares designated | (1,000) | |||||||||||
Preferred stock, shares authorized | 1,734,992 | |||||||||||
Amount recieved from preferred right | $ | $ 784,500 | |||||||||||
Repaid amount under preferred right | $ | 744,500 | |||||||||||
Current balance, preferred right | $ | $ 40,000 | $ 40,000 | ||||||||||
Treasury shares for services | 504,300 | |||||||||||
Treasury shares remaining outstanding for services | 12,180 | 12,180 | ||||||||||
Derivative Liabilities | $ | $ 2,334,377 | $ 3,898,914 | ||||||||||
Common stock, shares authorized | 40,000,000 | 40,000,000 | ||||||||||
Common stock, shares issued | 22,246,654 | 18,091,293 | ||||||||||
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | ||||||||||
Common stock, shares outstanding | 18,091,293 | 18,091,293 | ||||||||||
Stock compensation expense | $ | $ 881,250 | $ 1,005,223 | ||||||||||
Principal amount | $ | $ 59,895 | $ 67,070 | $ 347,826 | |||||||||
Warrants outstanding | 892,165 | 2,657,895 | ||||||||||
Exercise price | $ / shares | $ 0.01 | |||||||||||
DynaResource, Inc [Member] | Additional Financing Agreement [Member] | Golden Post Rail, LLC, Texas Limited Company [Member] | ||||||||||||
Principal amount | $ | $ 1,400,000 | |||||||||||
Conversion price | $ / shares | $ 2 | $ 2 | ||||||||||
Common stock purchase | 439,026 | 783,976 | ||||||||||
Exercise price | $ / shares | $ 0.01 | $ 0.01 | ||||||||||
2021 Activity [Member] | ||||||||||||
Exercise of warrant | 368,468 | |||||||||||
Warrants outstanding | 3,060,998 | |||||||||||
Common stock purchase | 368,468 | |||||||||||
Exercise price | $ / shares | 0.01 | |||||||||||
2022 Activity [Member] | ||||||||||||
Exercise of warrant | 2,166,775 | |||||||||||
Common stock, par value | $ / shares | $ 2.04 | |||||||||||
Warrants outstanding | 892,165 | |||||||||||
Common stock purchase | 2,655,361 | 368,468 | ||||||||||
Series C Senior Convertible Preferred Stock | ||||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||
Preferred stock, shares authorized | 1,734,992 | 1,734,992 | ||||||||||
Preferred stock shares outstanding | 1,734,992 | 1,734,992 | ||||||||||
Preferred stock, shares issued | 1,734,992 | 1,734,992 | ||||||||||
Total arrears on dividend | $ | $ 1,053,777 | |||||||||||
Description of 2015 warrant | Attached to the Series C Preferred Stock issued in 2015 were 2,000,000 warrants, described as the “2015 Warrant” which gave the holder the right to purchase common shares at $2.50 per share. After anti-dilution protection, these warrants became 2,166,527 warrants to purchase common shares at $2.04 and on June 28, 2022, the 2015 Warrant was exercised | |||||||||||
Series C, shares authorized | 1,734,992 | 1,734,992 | ||||||||||
Conversion price per shares | $ / shares | $ 2.04 | $ 2.04 | ||||||||||
Common stock acquired | 2,655,361 | |||||||||||
Shares dividend receive per annum | 4% | |||||||||||
Dividend payable | $ | $ 4,337,480 | |||||||||||
Preferred stock value | $ | $ 4,337,480 | $ 4,337,480 | ||||||||||
Series A Preferred Stock [Member] | ||||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||
Preferred stock, shares designated | 1,000 | 1,000 | ||||||||||
Preferred stock, shares authorized | 3,000,000 | 1,000 | ||||||||||
Preferred stock shares outstanding | 1,000 | 1,000 | ||||||||||
Preferred stock, shares issued | 1,000 | 1,000 | ||||||||||
Preferred stock value | $ | $ 1 | $ 1 | ||||||||||
Common Stock [Member] | ||||||||||||
Common stock, shares authorized | 40,000,000 | 40,000,000 | ||||||||||
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | ||||||||||
Common stock, shares outstanding | 22,246,654 | 18,091,293 | ||||||||||
Preferred Stock Undesignated | ||||||||||||
Preferred stock, shares designated | 1,734,992 | |||||||||||
Preferred stock, shares authorized | 15,265,008 | |||||||||||
Series D Convertible Preferred Stock [Member] | Retirement [Member] | ||||||||||||
Preferred stock shares outstanding | 760,000 | 760,000 | ||||||||||
Preferred stock, shares issued | 760,000 | |||||||||||
Convertible note into preferred stock | $ | $ 1,520,000 | |||||||||||
Convertible note into preferred stock price per share | $ / shares | $ 2 | |||||||||||
Fair value of derivative on the date of issuance notes | $ | $ 287,508 | |||||||||||
Preferred stock value | $ | $ 1,019,431 | |||||||||||
Description of compensatory issuances | These Series D Preferred Shares are convertible to common shares at $2.00 per share, through October 18, 2026. The Series D Preferred Shares carry a 4% per annum dividend and in arrears. The Dividend is calculated at 4.0% of $1,520,000 payable annually on October 18. At December 31, 2022, $60,800 dividends were in arrears | |||||||||||
Derivative Liabilities | $ | $ 3,898,914 | $ 2,172,417 | ||||||||||
Golden post warrants | $ | 1,320,380 | |||||||||||
Series D convertible note kicker warrants | $ | 1,559,103 | |||||||||||
Deemed dividend | $ | $ 234,299 | $ 188,699 | ||||||||||
Convertible note repurchase amount | $ | $ 2,500,000 | |||||||||||
Number of noteholders | integer | 10 | |||||||||||
Stock Issuances | ||||||||||||
Common stock, shares issued | 2,166,775 | 368,468 | ||||||||||
Exercise of warrant | 2,655,361 | |||||||||||
Stock compensation expense | $ | $ 881,250 | |||||||||||
Total award shares | 150,000 | |||||||||||
Description of stock issuances | stock awards approved were issued to each of the individuals/entities and vested 25% immediately with the remainder vesting 25% each year on December 31 for the next three years, subject to resignation or termination provisions |
STOCK BASED COMPENSATION (Detai
STOCK BASED COMPENSATION (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended |
Dec. 28, 2022 | Dec. 31, 2022 | |
Stock compensation expense | $ 881,250 | |
Deferred compensation | $ 2,643,750 | |
Vested portion of the total stock value | 25% | |
Closing stock price | $ 2.35 | |
Restricted Stock [Member] | ||
Shares vested at issuance | 25% | |
Shares vested at additional | 25% | |
Issued shares of common stock | 1,500,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Total shares | 150,000 | |
Related party consulting and other fees | $ 184,583 | $ 285,999 |
Officers And Directors [Member] | ||
Awarded shares | 475,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Short Term Lease Costs | $ 17,711 |
Variable Lease Costs | 91,590 |
Total | 288,678 |
Office Lease | |
Operating Lease | 88,043 |
Ground Lease | |
Operating Lease | $ 91,334 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details 1) | Dec. 31, 2022 |
COMMITMENTS AND CONTINGENCIES | |
Weighted Average Discount Rate - Operating Leases | 12.50% |
Weighted Average Remaining Lease Term (Years) - Operating Leases | 10% |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES (Details 2) | Dec. 31, 2022 USD ($) |
COMMITMENTS AND CONTINGENCIES | |
2023 | $ 101,499 |
2024 | 96,896 |
2025 | 99,803 |
2026 | 102,797 |
2027 | 105,881 |
Thereafter | 579,003 |
Total | 1,085,879 |
Less Imputed Interest | (498,097) |
OPERATING LEASE PAYABLE | $ 587,782 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Jan. 06, 2014 | May 20, 2021 | Dec. 31, 2022 | Dec. 31, 2020 | |
Concession taxes, description | the Company does not anticipate that DynaMéxico will have any difficulties meeting the minimum annual expenditures for the concessions ($388 – $2,400 Mexican Pesos per hectare). DynaMéxico retains sufficient carry- forward amounts to cover over 10 years of the minimum expenditure (as calculated at the 2017 minimum, adjusted for annual inflation of 4%) | |||
Description of arbitration proceeding against Mineras | Mercuria Energy Trading, S.A. (“Mercuria”) initiated an arbitration proceeding against Mineras de Dynaresource, S.A. de C.V. (“Mineras”), arising out of the earlier-terminated supply agreement between the parties. In January 2022, The arbitration panel awarded Mercuria the sum of US$1,822,674, plus interest at 2% over the quarterly compounded USD 3- month LIBOR rate, from February 2020 forward. In August 2022, the panel also assessed costs of the arbitration proceeding against Mineras, in the aggregate amount of £ 376,232.75. DynaResource has accrued $1,000,000 for the arbitration award and related costs | |||
Goldgroup Resources Inc [Member] | ||||
Legel bond | $ 1,110,000 | |||
Interest on bond | $ 4,054,000,000 | |||
DynaMineras [Member] | ||||
Lease payment anually | $ 1,359,443 | |||
Rent expense | 3,678,437 | |||
Land Lease Agreement [Member] | ||||
Land area | 4,399 hectares | |||
Lease agreement term | 20 years | |||
Lease payment anually | $ 183,000 |
DERIVATIVE LIABILITIES (Details
DERIVATIVE LIABILITIES (Details) - $ / shares | 12 Months Ended | 36 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Series C Preferred Stock | |||
Annual Volatility Rate | 116% | 147% | |
Risk Free Rate | 4.41% | 0.73% | |
Remaining Term | 7 years 4 months 13 days | 8 years 4 months 13 days | |
Fair Value of Common Stock | $ 2.44 | $ 2.44 | $ 1.75 |
Preferred Series C Warrant | |||
Annual Volatility Rate | 0% | 147% | |
Risk Free Rate | 4.41% | 0.73% | |
Remaining Term | 0 years | 6 months | |
Fair Value of Common Stock | $ 2.44 | $ 2.44 | 1.75 |
Preferred Series D Warrant | |||
Annual Volatility Rate | 0% | 147% | |
Risk Free Rate | 4.41% | 0.73% | |
Remaining Term | 0 years | 6 months | |
Fair Value of Common Stock | $ 2.44 | $ 2.44 | $ 1.75 |
DERIVATIVE LIABILITIES (Detai_2
DERIVATIVE LIABILITIES (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Exercise of warrants | $ (5,416,935) | $ (3,685) |
Series C Preferred Stock | ||
Fair Value of Derivative, Beginning Balance | 1,559,103 | 952,634 |
Exercise of warrants | 0 | (659,558) |
Change in Fair Value of Derivative | 613,314 | 1,266,027 |
Fair Value of Derivative, Ending Balance | 2,172,417 | 1,559,103 |
Preferred Series C Warrant | ||
Fair Value of Derivative, Beginning Balance | 1,019,431 | 601,313 |
Change in Fair Value of Derivative | (1,019,431) | 418,118 |
Fair Value of Derivative, Ending Balance | 0 | 1,019,431 |
Fair Value of Derivative on the Date of Issuance | 0 | 0 |
Preferred Series D Warrant | ||
Fair Value of Derivative, Beginning Balance | 1,320,380 | 817,613 |
Change in Fair Value of Derivative | (1,320,380) | 502,767 |
Fair Value of Derivative, Ending Balance | 0 | 1,320,380 |
Fair Value of Derivative on the Date of Issuance | $ 0 | $ 0 |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Liabilities: | ||
Derivative Liabilities | $ 2,172,417 | $ 3,898,914 |
Total Liabilities | 2,172,417 | 3,898,914 |
Level 1 | ||
Liabilities: | ||
Derivative Liabilities | 0 | 0 |
Total Liabilities | 0 | 0 |
Level 2 | ||
Liabilities: | ||
Derivative Liabilities | 0 | 0 |
Total Liabilities | 0 | 0 |
Level 3 | ||
Liabilities: | ||
Derivative Liabilities | 2,172,417 | 3,898,914 |
Total Liabilities | $ 2,172,417 | $ 3,898,914 |
REVENUE CONCENTRATION (Details
REVENUE CONCENTRATION (Details Narrative) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
One and Three Customer [Member] | ||
Concentration of risk | 100% | 100% |
One And One Customers [Member] | ||
Concentration of risk | 100% | 100% |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
NOTES PAYABLE | ||
Property Holding Taxes, Beginning Balance | $ 1,962,525 | $ 2,081,435 |
Exchange Rate Adjustment | 100,424 | (57,504) |
Principal Payments | (94,698) | (61,406) |
Property Holding Taxes, Ending Balance | $ 1,968,251 | $ 1,962,525 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | ||||
Oct. 31, 2019 | Feb. 28, 2019 | Jul. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2022 | |
NOTES PAYABLE | |||||
Unpaid mining concession taxes on the Francisco Arturo mining concession | $ 299,474 | $ 335,350 | $ 1,739,392 | ||
Initial payment amount | $ 59,895 | $ 67,070 | $ 347,826 | ||
Initial payment percentage rate | 20% | 20% | 20% | ||
Remaining finance balance term over the period | 36 years | 36 years | 36 years | ||
Remaining finance balance term over the period percentage rate | 22% | 22% | 22% | ||
Accrued interest included in accrued liabilities | $ 1,572,972 | ||||
Reduction in the volume of mining concession | In June 2018, the Company applied for a reduction of the Francisco Arturo mining concession, from 69,121 hectares to 3,280 hectares. | ||||
Reduction in the value of initial payment amount | $ 22,500 | ||||
Reduction in the value of initial payment amount in pesos | $ 985,116 |
REVOLVING CREDIT LINE FACILITY
REVOLVING CREDIT LINE FACILITY (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||||||||||||
Nov. 14, 2022 | Aug. 09, 2021 | May 12, 2021 | Feb. 04, 2021 | Sep. 29, 2022 | Aug. 19, 2022 | Jun. 28, 2022 | May 19, 2022 | Mar. 30, 2022 | Feb. 25, 2022 | Dec. 30, 2021 | Nov. 19, 2021 | Sep. 29, 2021 | Jun. 18, 2021 | Mar. 30, 2021 | Dec. 31, 2022 | Dec. 28, 2022 | May 01, 2021 | |
CONVERTIBLE PROMISSORY NOTES | ||||||||||||||||||
Revolving credit line facility amount | $ 37,500 | |||||||||||||||||
Revolving credit line facility maximum amount | $ 37,500 | |||||||||||||||||
Concentrates on delivery percentage rate | 100% | |||||||||||||||||
Revolving credit line facility interest free term | 45 years | |||||||||||||||||
Revolving credit line facility deliveries of concentrates or cash free term | 120 years | |||||||||||||||||
Revolving credit line facility increased percentage rate | 80% | |||||||||||||||||
Proceeds advances from buyers | $ 825,000 | $ 82,500 | $ 375 | $ 250,000 | $ 773,750 | $ 780,000 | $ 875,000 | $ 887,500 | $ 787,500 | $ 817,500 | $ 92,500 | $ 82,500 | $ 82,500 | $ 67,500 | $ 37,500 | $ 935,000 | ||
Advances settlement date from buyers | Dec. 28, 2022 | Sep. 27, 2021 | Jun. 16, 2021 | Mar. 26, 2021 | Nov. 15, 2022 | Sep. 28, 2022 | Aug. 15, 2022 | Jun. 27, 2022 | May 13, 2022 | Mar. 30, 2022 | Feb. 25, 2022 | Dec. 30, 2021 | Nov. 17, 2021 | Aug. 05, 2021 | May 12, 2021 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - January 31 2023 [Member] - Subsequent Event [Member] | 1 Months Ended |
Jan. 31, 2023 USD ($) | |
Monthly lease payments | $ 10,000 |
New lease commences | Apr. 15, 2023 |
Expiry of Lease | 52 years |