Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Mar. 31, 2020 | Jan. 13, 2020 | |
Registrant CIK | 0001288750 | ||
Fiscal Year End | --09-30 | ||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Sep. 30, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-34055 | ||
Entity Registrant Name | TIMBERLINE RESOURCES CORP | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 82-0291227 | ||
Entity Address, Address Line One | 101 East Lakeside Avenue | ||
Entity Address, City or Town | Coeur d’Alene | ||
Entity Address, State or Province | ID | ||
Entity Address, Postal Zip Code | 83814 | ||
Entity Address, Address Description | Address of Principal Executive Offices | ||
City Area Code | 208 | ||
Local Phone Number | 664-4859 | ||
Phone Fax Number Description | Registrant’s Telephone Number, including Area Code) | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,947,819 | ||
Share Price | $ 0.05 | ||
Entity Common Stock, Shares Outstanding | 113,025,224 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
OTCQB | |||
Title of 12(b) Security | Common Stock, $0.001 par value | ||
Trading Symbol | TLRS | ||
Security Exchange Name | NONE | ||
TSX-V | |||
Title of 12(b) Security | Common Stock, $0.001 par value | ||
Trading Symbol | TBR | ||
Security Exchange Name | NONE |
Timberline Resources Corp and S
Timberline Resources Corp and Subsidiaries Consolidated Balance Sheets - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 | |
CURRENT ASSETS: | |||
Cash | $ 2,520,726 | $ 30,757 | |
Prepaid expenses and other current assets | 14,144 | 21,132 | |
Account receivable | 0 | 118,525 | |
TOTAL CURRENT ASSETS | 2,534,870 | 170,414 | |
PROPERTY, MINERAL RIGHTS, AND EQUIPMENT, net (NOTE 3) | [1] | 13,807,655 | 15,023,843 |
OTHER ASSETS: | |||
Reclamation bonds | 538,696 | 305,184 | |
Deposits and other assets | 5,700 | 5,700 | |
TOTAL OTHER ASSETS | 544,396 | 310,884 | |
TOTAL ASSETS | 16,886,921 | 15,505,141 | |
CURRENT LIABILITIES: | |||
Accounts payable | 173,981 | 103,485 | |
Accrued expenses | 39,440 | 113,192 | |
Accrued interest - related party | 142,492 | 83,107 | |
Accrued payroll, benefits and taxes | 23,557 | 24,038 | |
Payment obligation, current | 0 | 52,970 | |
TOTAL CURRENT LIABILITIES | 379,470 | 376,792 | |
LONG-TERM LIABILITIES: | |||
Asset retirement obligation | 112,615 | 168,619 | |
Payment obligation, noncurrent | 0 | 125,563 | |
Senior unsecured note payable - related party - net of discount (NOTE 6) | [2] | 300,000 | 452,255 |
TOTAL LONG-TERM LIABILITIES | 412,615 | 746,437 | |
TOTAL LIABILITIES | 792,085 | 1,123,229 | |
COMMITMENTS AND CONTINGENCIES (NOTES 3, 5 and 11) | [3] | 0 | 0 |
STOCKHOLDERS' EQUITY: (NOTE 9) | |||
Preferred stock, $0.01 par value; 10,000,000 shares authorized, none issued and outstanding | 0 | 0 | |
Common stock, $0.001 par value; 200,000,000 shares authorized, 112,075,224 and 67,395,260 shares issued and outstanding, respectively | 112,075 | 67,395 | |
Additional paid-in capital | 79,613,593 | 74,568,258 | |
Accumulated deficit | (63,630,832) | (60,253,741) | |
TOTAL STOCKHOLDERS' EQUITY | 16,094,836 | 14,381,912 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 16,886,921 | $ 15,505,141 | |
[1] | NOTE 3 | ||
[2] | NOTE 6 | ||
[3] | NOTES 3, 5 and 11 |
Timberline Resources Corp and_2
Timberline Resources Corp and Subsidiaries Consolidated Balance Sheets - Parenthetical - $ / shares | Sep. 30, 2020 | Sep. 30, 2019 |
Details | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares, Issued | 112,075,224 | 67,395,260 |
Common Stock, Shares, Outstanding | 112,075,224 | 67,395,260 |
Timberline Resources Corp and_3
Timberline Resources Corp and Subsidiaries Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
OPERATING EXPENSES: | ||
Mineral exploration | $ 932,208 | $ 722,113 |
Abandonment of mineral rights | 1,218,715 | 48,500 |
Salaries and benefits | 299,340 | 174,811 |
Professional fees | 172,362 | 272,100 |
Insurance | 95,579 | 92,474 |
Gain on change in ARO estimate | (83,050) | 0 |
Other general and administrative | 327,614 | 154,234 |
TOTAL OPERATING EXPENSES | 2,962,768 | 1,464,232 |
LOSS FROM OPERATIONS | (2,962,768) | (1,464,232) |
OTHER INCOME (EXPENSE): | ||
Foreign exchange gain (loss) and other | (863) | (51) |
Interest expense | (35,965) | (9,436) |
Interest expense - related party | (181,884) | (183,564) |
Loss on debt modification - related party | (195,611) | 0 |
TOTAL OTHER INCOME (EXPENSE) | (414,323) | (193,051) |
LOSS BEFORE INCOME TAXES | (3,377,091) | (1,657,283) |
INCOME TAX PROVISION (BENEFIT) | 0 | 0 |
NET LOSS | $ (3,377,091) | $ (1,657,283) |
NET LOSS PER SHARE, BASIC AND DILUTED | $ (0.04) | $ (0.03) |
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED | 78,725,630 | 62,482,406 |
Timberline Resources Corp and_4
Timberline Resources Corp and Subsidiaries Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings | Total | |
Equity Balance at Sep. 30, 2018 | $ 53,528 | $ 73,197,430 | $ (58,596,458) | $ 14,654,500 | |
Equity balance, shares at Sep. 30, 2018 | 53,527,819 | ||||
Common stock and warrants issued for cash, net | $ 13,867 | 1,095,528 | 0 | 1,109,395 | |
Common stock and warrants issued for cash, net | 13,867,441 | ||||
Stock based compensation | $ 0 | 5,000 | 0 | 5,000 | |
Warrants issued to AGEI for joint venture | 0 | 176,000 | 0 | 176,000 | |
Warrants issued with Debt | 0 | 94,300 | 0 | 94,300 | |
Net assets acquired upon obtaining control of LM LLC (see note 3) | 0 | ||||
Net loss | $ 0 | 0 | (1,657,283) | (1,657,283) | |
Equity balance, shares at Sep. 30, 2019 | 67,395,260 | ||||
Equity Balance at Sep. 30, 2019 | $ 67,395 | 74,568,258 | (60,253,741) | 14,381,912 | |
Common stock and warrants issued for cash, net | $ 41,137 | 4,156,863 | 0 | 4,198,000 | |
Common stock and warrants issued for cash, net | 41,136,364 | ||||
Stock based compensation | $ 0 | 161,100 | 0 | 161,100 | |
Common stock issued for exercise of warrants, Value | $ 3,543 | 244,509 | 0 | 248,052 | |
Common stock issued for exercise of warrants, Shares | 3,543,600 | ||||
Warrants issued for debt modification | $ 0 | 170,500 | 0 | 170,500 | |
Net assets acquired upon obtaining control of LM LLC (see note 3) | [1] | 0 | 312,363 | 0 | 312,363 |
Net loss | $ 0 | 0 | (3,377,091) | (3,377,091) | |
Equity balance, shares at Sep. 30, 2020 | 112,075,224 | ||||
Equity Balance at Sep. 30, 2020 | $ 112,075 | $ 79,613,593 | $ (63,630,832) | $ 16,094,836 | |
[1] | see note 3 |
Timberline Resources Corp and_5
Timberline Resources Corp and Subsidiaries Consoldiated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (3,377,091) | $ (1,657,283) | |
Adjustments to reconcile net loss to net cash used by operating activities: | |||
Stock based compensation | 161,100 | 5,000 | |
Abandonment of mineral rights | 1,218,715 | 48,500 | |
Accretion of asset retirement obligation | 24,431 | 8,031 | |
Gain on change in ARO estimate | (83,050) | 0 | |
Loss on debt modification - related party | 195,611 | 0 | |
Amortization of discount on senior unsecured notes payable | 72,634 | 100,121 | |
Changes in assets and liabilities: | |||
Prepaid expenses and other current assets | 6,988 | 23,650 | |
Account receivable | 118,525 | (118,525) | |
Accounts payable | 70,496 | (6,649) | |
Accrued expenses | (14,367) | 154,133 | |
Accrued payroll, benefits, and taxes | (481) | (8,257) | |
Net cash used by operating activities | (1,606,489) | (1,451,279) | |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchase of mineral rights | (33,000) | (72,715) | |
Proceeds from lease of mineral rights | 110,487 | 102,791 | |
Increase decrease in Accrued Cost of Mineral Reclamation | (233,512) | 2,102 | |
Advance receive from LM LLC prior to acquisition | 205,194 | 0 | |
Cash acquired upon obtaining control of LM LLC | 29,770 | 0 | |
Net cash provided by investing activities | 78,939 | 32,178 | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from sale of common stock and warrants, net | 4,198,000 | 1,109,395 | |
Proceeds from exercise of warrants | 248,052 | 0 | |
Payment on payment obligation | (178,533) | (20,273) | |
Proceeds from senior unsecured note payable - related party | 0 | 250,000 | |
Payment on senior unsecured note payable - related party | (250,000) | 0 | |
Net cash provided by financing activities | 4,017,519 | 1,339,122 | |
Net increase (decrease) in cash and cash equivalents | 2,489,969 | (79,979) | |
CASH AT BEGINNING OF YEAR | 30,757 | 110,736 | |
CASH AT END OF YEAR | 2,520,726 | 30,757 | |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 96,816 | 13,562 | |
Non-cash financing and investing activities: | |||
Net assets acquired upon obtaining control of LM LLC (see note 3) | 312,363 | [1] | 0 |
Warrants issued for purchase of mineral properties | 0 | 176,000 | |
Warrants issued with senior unsecured notes payable | $ 0 | $ 94,300 | |
[1] | see note 3 |
Note 1 - Organization and Descr
Note 1 - Organization and Description of Business | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 1 - Organization and Description of Business: | NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS: Timberline Resources Corporation (“Timberline” or “the Company”) was incorporated in August of 1968 under the laws of the State of Idaho as Silver Crystal Mines, Inc., for the purpose of exploring for precious metal deposits and advancing them to production. In 2008, the Company reincorporated into the State of Delaware, pursuant to a merger agreement approved by its shareholders. |
Note 2 - Summary of Significant
Note 2 - Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 2 - Summary of Significant Accounting Policies: | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: a. Basis of Presentation and Going Concern The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company has incurred losses since its inception. The Company has sufficient cash to fund normal operations and meet all of its obligations for the next 12 months without raising additional funds. However, we are an exploration company with exploration programs that require significant cash expenditures. A significant drilling program, such are those we have planned, can result in depletion of cash and return us to a position of insufficient cash to support normal operations for 12 months. The Company currently has no historical recurring source of revenue, and its ability to continue as a going concern is dependent on its ability to raise capital to fund future exploration and working capital requirements, or the Company’s ability to profitably execute its business plan. The Company’s plans for the long-term return to and continuation as a going concern include financing its future operations through sales of common stock and/or debt and the eventual profitable exploitation of its mining properties. While the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms acceptable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. If the going concern basis were not appropriate for these financial statements, adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses and the balance sheet classifications used. b. In August 2020, the FASB issued ASU No. 2020-06 Debt - Debt With Conversion And Other Options (Subtopic 470-20) And Derivatives And Hedging - Contracts In Entity’s Own Equity (Subtopic 815-40): Accounting For Convertible Instruments And Contracts In An Entity’s Own Equity. The update simplifies the accounting for and disclosures related to company debt that is convertible or can be settled in a company’s own equity securities. The update is effective for fiscal years beginning after December 15, 2021. Management is evaluating the impact of this update on the Company’s debt disclosures. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. c. Principles of Consolidation d. Exploration Expenditures economically developed as a result of establishing proven and probable reserves, the costs incurred after such determination will be capitalized and amortized over their useful lives. To date, the Company has not established the commercial feasibility of its exploration prospects; therefore, all exploration costs are being expensed. e. Property Holding Costs f. Fair Value At September 30, 2020 and 2019, the Company had no assets or liabilities accounted for at fair value on a recurring basis or nonrecurring basis. The carrying amounts of financial instruments, including senior unsecured notes payable and the payment obligation, approximate fair value at September 30, 2020 and 2019. g. Cash Equivalents h. Reclamation Bonds i. Estimates and Assumptions j. Accounting for Investments in Joint Ventures – Accounting Standards Codification (“ASC”) 321 Investments – Equity Securities The Company recognizes as income funds that are received from distributions from net accumulated earnings of the joint venture. For joint ventures where the Company holds more than 50% of the voting interest and has significant influence, the joint venture is consolidated with the presentation of a non-controlling interest. In determining whether significant influence exists, the Company considers its participation in policy-making decisions and its representation on the venture’s management committee. The Company has no significant influence over its joint ventures, and therefore accounts for its investment using the cost less impairment basis. The Company periodically assesses its investments in joint ventures for impairment. If management determines that a decline in fair value is other than temporary it will write-down the investment and charge the impairment against operations. k. Property and Equipment over the useful life of the assets. Gains or losses on disposition or retirement of property and equipment are recognized in operating expenses. l. Carrying Value of Property, Mineral Rights and Equipment for Impairment m. Asset Retirement Obligations – n. Provision for Income Taxes o. Translation of Foreign Currencies p. Stock-based Compensation The value of common stock awards is determined based upon the closing price of the Company’s stock on the grant date of the award. Compensation expense for grants that vest is recognized ratably over the vesting period. The fair value of stock unit or stock awards is determined by the closing price of the Company’s common stock on the date of the grant. q, Net Income (Loss) per Share 2020 2019 Stock options 5,400,000 3,280,000 Warrants 75,634,670 49,057,408 Total potential dilution 81,034,670 52,337,408 At September 30, 2020 and 2019, the effect of the Company’s common stock equivalents would have been anti-dilutive. |
Note 3 - Property, Mineral Righ
Note 3 - Property, Mineral Rights, and Equipment | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 3 - Property, Mineral Rights, and Equipment: | NOTE 3 – PROPERTY, MINERAL RIGHTS AND EQUIPMENT: The following is a summary of property, mineral rights, equipment and accumulated depreciation at September 30, 2020 and 2019: Expected Useful Lives (years) 2020 2019 Mineral rights – Eureka - $ 13,701,178 $ 13,703,651 Mineral rights – Elder Creek - - 1,218,715 Mineral rights – Other - 55,000 50,000 Total mineral rights 13,756,178 14,972,366 Equipment and vehicles 2-5 53,678 53,678 Office equipment and furniture 3-7 70,150 70,150 Land - 51,477 51,477 Total property and equipment 175,305 175,305 Less accumulated depreciation (123,828) (123,828) Property, mineral rights, and equipment, net $ 13,807,655 $ 15,023,843 Depreciation expense for the years ended September 30, 2020 and 2019, was $0 for each period. During the year ended September 30, 2020, the Company recognized an abandonment expense of $1,218,715 relating to the Elder Creek property for which the Company elected to not make required claims fee payments to McEwen Mining. See the discussion of Elder Creek below. During the year ended September 30, 2019, the Company recognized an abandonment expense of $48,500 relating to two patented mining claims upon which the Company had ceased making advance royalty payments on. Management and the Board of Directors has determined that certain payments received by the Company from a third party in two of the Company’s leases beginning in August 2017, which had been held and not recorded or deposited pending an expected resolution of circumstances relating to two historical leases at the Company’s Eureka property, should be deposited into the Company’s accounts. The total amount of these payments received for the year ended September 30, 2020 and September 30, 2019 was $110,487 and $102,791, respectively. Monthly payments in the amount of approximately $8,700 are expected to continue to be received, recorded and deposited until the situation concerning the leases is resolved. These receipts are recorded as a reduction to mineral rights. Elder Creek: Management sought, but was unable to bring in a major company partner to farm into its rights under the agreement with McEwen Mining. A proposed agreement required the consent of McEwen Mining, which was not obtained prior to the June 30, 2020 anniversary deadline for payment of holding costs. McEwen Mining was unwilling to renegotiate the agreement and consent to the assignment to a third party, and due to the Company’s inability and unwillingness to raise additional funds at significantly higher interest rates to pay for the ongoing claims fees, Timberline elected to terminate the agreement on the anniversary date. The Company recognized a loss on abandonment of $1,218,715, which was the carrying value of the mineral rights. Lookout Mountain, LLC: On May 9, 2019, the Company entered into a non-binding Letter of Intent to form a Limited Liability Company (the “Agreement”) with PM & Gold Mines, Inc. (“PM&G”) for the advanced exploration, and if determined feasible, the development of the Company’s Lookout Mountain Gold Project. A final Agreement received regulatory approval from the TSX Venture Exchange on July 27, 2019. PM&G is a private firm incorporated in Nevada with an interest to explore and advance gold projects to production. The parties executed a binding definitive Limited Liability Company Agreement (the “LLC” and the “LLC Agreement”) effective June 28, 2019 following completion of business and technical due diligence. The LLC Agreement called for PM&G to fund exploration and development activities in two stages for an earned equity in the project. Timberline contributed certain claims that constitute the Lookout Mountain Target and adjacent historical Oswego Mine area to the limited liability company in exchange for its ownership position. Timberline was to manage the project at least through Stage I of investment. PM&G was to retain the right to manage all Stage II activities with or without Timberline’s participation. Concurrent with completion of the Agreement, PM&G also participated in a private placement and acquired 3,367,441 shares, or 4.99%, of Timberline’s common shares, for a total of $269,395. Additionally, 3,367,441 warrants were issued with an exercise price of $0.14, expiring on March 22, 2022 (see Note 9). The placement included the right of PM&G to maintain its position in Timberline by pro-rata participation in future financings. The initial interests in the LLC were 51% PM&G and 49% Timberline, subject to PM&G’s contribution to the LLC in the form of an earn-in. Timberline would manage the project through at least the initial stage of investment at which PM&G vested at 51% ownership. PM&G retained the right to manage all subsequent activities with or without Timberline’s participation. The Company accounted for its investment in the LLC on the cost less impairment basis. PM&G’s contribution to the LLC was to be earned-in as follows: · · None of the Stage II or further options reached fruition as PM&G did not meet its minimum contribution requirement to earn or maintain its ownership position in Stage I. During the first year of the Agreement, PM&G remitted $755,605 toward the required contribution, well short of the $3,000,000 due by June 28, 2020. The Company gave the required 30-day written notice of the shortfall, to which PM&G did not respond. As a result, effective July 29, 2020, PM&G resigned under terms of the Agreement, forfeiting its rights and interests under the Agreement. At July 29, 2020, the Company became the 100% owner of the LLC and all PM&G ownership was forfeited. Due to the change in ownership and the transfer to the Company of all management and approval responsibilities, the Company began consolidating all balance sheet and expense transactions into its consolidated financial statements as of July 29, 2020. Due to the status of the Company’s investment, Management determined that the acquisition of the remaining portion of the LLC should be accounted for as a transaction between companies under common control. As a result, the assets of the LLC were recognized in the consolidated financial statements at their net book value upon acquisition date. The net book values of LLC’s net assets consisted of the following on July 29, 2020: Net Asset Value on July 29, 2020 Cash $ 29,770 Advance to the Company 205,194 Mineral properties 7,637,403 Net Assets 7,872,367 Eliminated upon consolidation: Investment in LM LLC (7,354,810) Advance from LM LLC (205,194) $ 312,363 The total net asset value of $312,363 was recognized as an increase in additional paid in capital. |
Note 4 - Related-party Transact
Note 4 - Related-party Transactions | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 4 - Related-party Transactions: | NOTE 4 – RELATED-PARTY TRANSACTIONS: Mr. William Matlack was appointed to the Company’s Board of Directors on October 29, 2019. Mr. Matlack was the holder of the Unsecured senior notes payable totaling $550,000 ($452,255 net of unamortized discounts), plus interest accrued totaling $83,107 at September 30, 2019. During fiscal 2020, $250,000 of the notes was repaid together with $60,851 of interest accrued thereon. In conjunction with his appointment to the Board, he was issued 100,000 stock options to acquire shares of common stock of the Company. At September 30, 2020, the Company owed Mr. Matlack $300,000 plus $142,492 of accrued interest. During the year ended September 30, 2020, two directors participated in a private placement offering of units of the Company, purchasing 909,091 units for total proceeds of $100,000. Each Unit was priced at $0.11 and consisted of one share of common stock of the Company and one common share Class L Warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of $0.20 per share until August 15, 2023. The participation of the directors of the Company in this private placement was on the same terms as other investors in the private placement offering. The Board of Directors approved the insiders’ participation in the private placement. |
Note 5 - Payment Obligation
Note 5 - Payment Obligation | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 5 - Payment Obligation: | NOTE 5 – PAYMENT OBLIGATION: On September 12, 2017, the Company entered into an agreement (the “Payment Agreement”) with a creditor (the “Creditor”) to pay by way of a payment plan an existing obligation of $250,000 (the “Payment Obligation”) related to a potential corporate transaction in 2015 that was not completed. Pursuant to the Payment Agreement, the Company agreed to pay the Payment Obligation to the Creditor, including interest, on or before September 12, 2020. Interest accrued on the unpaid principal amount of the Payment Obligation at the prime rate, as such rate may change from time to time, plus 3% per annum. The Company agreed to pay the Creditor 5% of the gross proceeds of any funds raised, whether through equity sales, debt offerings, or sales of assets. If the gross proceeds of any equity financing are at least $1 million, then the Company agreed to also commence monthly installment payments of $10,000 until the Payment Obligation is paid. During the year ended September 30, 2019, the Company paid $30,000 including interest of $9,728. At September 30, 2019, an additional cash payment of $52,970 was due to the Creditor, representing 5% of the private placements of $80,000, $160,000 and $269,395 respectively and 5% on the two Senior unsecured notes payable totaling $550,000. On December 30, 2019, the Company entered into Addendum 1 to the Payment Agreement under which Creditor has agreed to waive a default condition in consideration of a $5,000 fee and a payment of $12,500 relating to the second Senior unsecured note of $250,000. On August 17, 2020, the Company closed a private placement and paid all amounts due under the terms of the Payment Obligation, including the delinquent amounts. A total of $158,176, including interest of $7,937, was remitted to satisfy the obligation. The balance of the Payment Obligation was $0 and $178,533 at September 30, 2020 and 2019, respectively. |
Note 6 - Senior Unsecured Note
Note 6 - Senior Unsecured Note Payable | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 6 - Senior Unsecured Note Payable: | NOTE 6 – SENIOR UNSECURED NOTES PAYABLE: On July 30, 2018, the Company entered into a loan agreement and promissory note with William Matlack, a significant shareholder who became a director and related-party on October 29, 2019 (the “Lender”). Lender loaned the Company $300,000 in the form of a senior unsecured note, with the principal bearing interest at an annual rate of 18%, compounded monthly. The loan is unsecured and the principal and accrued interest would have become due for repayment on January 20, 2020, but could have been repaid early without penalty. Pursuant to the terms of the loan agreement, the Company issued to the Lender 3,265,500 non-transferrable Series F Warrants to purchase common shares of the Company. The exercise price of the warrants was $0.09, and the warrants contained a provision restricting their exercise in the event any such exercise would cause the Lender to own 10% or more of the Company’s outstanding common shares. The relative fair value of the warrants issued in connection with the senior unsecured note was estimated at $110,900, based upon a total fair value as calculated by a Black-Scholes option-pricing model. On October 4, 2019, the Company entered into an agreement with the Lender to extend the due date of the note for a period of three years to mature on January 20, 2023, with the same terms as the original note. The Series F Warrants were cancelled and replaced with 4,000,000 Series K Warrants issued solely in relation to the extension of the note, with expiration at February 1, 2023 and an exercise price of $0.08. As a result of the extension of the due date, this note has been included in long-term debt on the Company’s consolidated balance sheet. The Company accounted for the change in terms of this Senior unsecured note payable as a debt modification. The fair value of the Series K Warrants issued in connection with the extension of the senior unsecured note and the fair value of the Series F Warrants at the date of amendment were estimated at $227,600 and $57,100, respectively, based upon fair values as calculated by a Black-Scholes option-pricing model using the following assumptions: Series K Warrants Issued October 4, 2019 Series F Warrants Canceled October 4, 2019 Expected volatility 147.20% 147.20% Stock price on date of grant $0.07 $0.07 Exercise price $0.08 $0.09 Expected dividends - - Expected term (in years) 3.333 3.333 Risk-free rate 1.34% 1.34% Expected forfeiture rate 0% 0% The unamortized discount related to the Series F warrants was $25,111 at the time of the amendment. The net difference in the fair values of the warrants of $170,500, together with the unamortized discount, were recorded as a loss on extinguishment of debt of $195,611 in the year ended September 30, 2020. At September 30, 2020, the note payable was $300,000, with all of the discount fully amortized. At September 30, 2019, the note payable was $274,889, which is net of the unamortized discount of $25,111. On May 8, 2019, the Company entered into a separate loan agreement and promissory note with the Lender. Under the loan agreement, the Lender loaned the Company $250,000 in the form of a senior unsecured note, with the principal bearing interest at an annual rate of 18%, compounded monthly. The loan was unsecured and the principal and accrued interest would become due for repayment on November 7, 2020, but may be repaid early without penalty. Pursuant to the terms of the May 8, 2019 loan agreement, the Company issued to the Lender 3,543,600 non-transferrable Series I Warrants to purchase common shares of the Company. The exercise price of the warrants is $0.07, with a term of eighteen months. The relative fair value of the warrants issued in connection with this senior unsecured note was estimated at $94,300, based upon a total fair value as calculated by a Black-Scholes option-pricing model. The relative fair value of the warrants was recorded as a discount of the note in the fiscal year ended September 30, 2020. Warrants Issued During the Year Ended September 30, 2019 Expected volatility 138.5% Stock price on date of the note $0.07 Exercise price $0.07 Expected dividends - Expected term (in years) 1.5 Risk-free rate 2.26% Expected forfeiture rate 0% On September 4, 2020, the Company paid the May 8, 2019 note in full, together with $60,851 of accrued interest for a total of $310,851. The unamortized discount of $25,136 was expensed concurrent with the payoff of the loan. At September 30, 2019, the note payable was $177,366, net of the unamortized discount of $72,634. The accrued interest on the two senior unsecured notes payable was $142,492 and $83,107 at September 30, 2020 and September 30, 2019, respectively. Interest expense related to the senior unsecured notes payable to this related party was $120,237 and $73,704 for the fiscal years ended September 30, 2020 and 2019, respectively. The $300,000 senior unsecured note payable would be senior to any other debt obtained by the Company subsequent to September 30, 2020. The note requires that when the Company enters into any other financings, 25% of the proceeds of such financings will be paid toward reduction of the principal and interest accrued on this note, which did not occur with the August 17, 2020 private placement. The Lender has provided a waiver of default on the Note that would otherwise exist due to a non-payment under this contract term for the note. |
Note 7 - Asset Retirement Oblig
Note 7 - Asset Retirement Obligation | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 7 - Asset Retirement Obligation: | NOTE 7 – ASSET RETIREMENT OBLIGATION: Remediation, reclamation and mine closure costs are based principally on legal and regulatory requirements. Management estimates costs associated with reclamation of mining properties as well as remediation costs for inactive properties. The Company uses assumptions about future costs, capital costs and reclamation costs. Such assumptions are based on the Company’s current mining plan and the best available information for making such estimates. In calculating the present value of the new estimate of the asset retirement obligation, the Company used a credit-adjusted risk-free interest rate of 8% and a projected mine life of 15 years. On an ongoing basis, management evaluates its estimates and assumptions; however, actual amounts could differ from those based on such estimates and assumptions. Changes to the Company’s asset retirement obligation on its mineral properties are as follows: 2020 2019 Beginning balance $ 168,619 $ 160,588 Change in ARO estimate (80,435) - Accretion expense 24,431 8,031 Ending balance $ 112,615 $ 168,619 In the quarter of Management updated the ARO at Lookout Mountain to reflect the actual disturbed acres from exploration activities and actual reclamation work performed to date. The updated estimate of undiscounted costs of approximately $234,119 is an increase from the $200,000 in the previous estimate. However, the ARO liability decreased by $80,435 as a result of changes in the estimated acres disturbed, estimated timing of costs, estimated costs to perform the reclamation work and the impact of discounting the costs to present value. The ARO related to the changes described above were discounted using a credit adjusted, risk-free interest rate of 5 .0 %. |
Note 8 - Income Taxes
Note 8 - Income Taxes | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 8 - Income Taxes: | NOTE 8 – INCOME TAXES: At September 30, 2020 and 2019, the Company did not record a tax provision or benefit. At September 30, 2020 and 2019, the Company had deferred tax assets arising principally from net operating loss carryforwards for income tax purposes. As the Company’s management cannot determine that it is more likely than not that the Company will realize the benefit of the net deferred tax asset, a valuation allowance equal to 100% of the net deferred tax asset has been recorded at September 30, 2020 and 2019. The components of the Company’s deferred taxes at September 30, 2020 and 2019 are as follows: Timberline Resources Corp. 2020 2019 Net deferred tax assets: Exploration costs $ 190,000 $ 32,000 Investments in subsidiaries 184,000 184,000 Share-based compensation 1,460,000 1,452,000 Alternative minimum tax credit carryforwards - 2,000 Foreign income tax credit carryforwards - 697,000 Federal and state net operating loss carryforwards 11,408,000 10,792,000 Foreign net operating loss carryforwards 1,736,000 1,736,000 Total deferred tax asset 14,978,000 14,895,000 Valuation allowance (14,978,000) (14,895,000) Net deferred tax asset $ - $ - BH Minerals USA, Inc. Net deferred tax assets (liabilities): Property, mineral rights, and equipment $ (2,302,000) $ (2,290,000) Exploration costs 479,000 572,000 Federal and state net operating loss carryforwards 3,871,000 3,597,000 Total deferred tax asset 2,048,000 1,879,000 Valuation allowance (2,048,000) (1,879,000) Net deferred tax asset $ - $ - The federal income taxes of the Company’s wholly owned subsidiary, BH Minerals USA, Inc., are not consolidated with those of the rest of the Company since BH Minerals USA, Inc. is wholly owned by the Company’s Canadian subsidiary, Staccato Gold Resources Ltd. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted in response to the COVID-19 pandemic. The CARES Act, among other things, permits NOL carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The Company does not expect that the NOL carryback provision of the CARES Act would result in a material cash benefit. The CARES Act increases the amount of business interest expense that may be deducted for tax years beginning in 2019 and 2020 by computing the section 163(j) limitation. The CARES Act generally limits a taxpayer’s business interest deductions for a taxable year to the sum of: (1) 50% of the taxpayer’s adjusted taxable income for that year, (2) its business interest income and (3) floor plan financing interest. Any interest expense not deductible under 163(j) for any affected year may be carried forward without limitation. The Company does not expect that the change in the section 163(j) provision of the CARES Act would result in a material cash effect. The annual tax benefit is different from the amount that would be provided by applying the statutory federal income tax rate to the Company’s pretax loss for the following reasons: 2020 2019 Net Loss $ (3,377,000) $ (1,657,000) Statutory Federal income tax rate 24.5% 24.5% Expected income tax benefit based on statutory rate (827,000) (406,000) Effect of state taxes 51,000 56,000 Expiration of foreign tax credit 697,000 - Taxable loss from unconsolidated entity (46,000) - Change in valuation allowance 252,000 77,000 Prior year change in estimates (127,000) 273,000 Income tax provision $ - $ - At September 30, 2020, the Company had total federal net operating loss carryforwards of approximately $49.6 million, of which $44.8 million expire in fiscal years ending September 30, 2024 through September 30, 2038. Federal net operating loss carryforwards of $4.8 million will not expire. State net operating losses total approximately $19.9 million and will expire in fiscal years ending September 30, 2021 through September 30, 2040. BH Minerals has total federal net operating loss carryforwards of approximately $18.4 million, of which $15.8 million expire in fiscal years ending September 30, 2025 through September 30, 2038. Federal net operating loss carryforwards of $2.6 million will not expire. At September 30, 2020, the Company also has approximately $6.7 million in net operating loss carryforwards in Canada which will expire in fiscal years ending September 30, 2024 through September 30, 2032. At September 30, 2020, $697,000 of foreign tax credit carryforwards expired. The Company has not identified any unrecognized tax benefits. If interest and penalties were to be assessed, the Company would charge interest to interest expense, and penalties to other operating expense. Fiscal years 2017 through 2020 remain subject to examination by state and federal tax authorities. The Company has reviewed its tax returns and believes the Company has not taken any unsubstantiated tax positions. IRS Code Section 382 limits the loss and credit carryforwards in the event of an “ownership change” of a corporation. The equity placement activities during the year ended September 30, 2020 did not give rise to an ownership change under Section 382. As a result of previous acquisitions, the Company acquired approximately $15,000,000 of federal net operating loss carryovers that are limited by Code Section 382. As of September 30, 2020, the Company has not determined if any other losses are limited by IRS Code Section 382. |
Note 9 - Common Stock, Warrants
Note 9 - Common Stock, Warrants and Preferred Stock | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 9 - Common Stock, Warrants and Preferred Stock: | NOTE 9 – COMMON STOCK, WARRANTS AND PREFERRED STOCK: Private Placements On October 18, 2018 and December 3, 2018, the Company closed two tranches of a private placement offering of 7,500,000 units of the Company at a price of $0.08 per unit for net proceeds of $600,000. Each unit in the offering consisted of one share of common stock of the Company and one Class E Warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of $0.14 per share until the warrant expiration date of October 29, 2021. On March 29, 2019, the Company closed the sale of 2,000,000 units, the first tranche of a private placement offering of up to 7,500,000 units of the Company at a price of $0.08 per unit, for total proceeds of $160,000. Each unit of the offering consists of one share of common stock of the Company and one common share purchase Class H warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of $0.14 per share until March 30, 2022. As a result, 2,000,000 shares of the Company’s common stock and 2,000,000 Warrants were issued. On June 14, 2019, the Company closed the sale of 1,000,000 units, the second tranche of a private placement offering of up to 7,500,000 units of the Company at a price of $0.08 per unit, for total proceeds of $80,000. Each unit of the offering consists of one share of common stock of the Company and one common share purchase Class H warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of $0.14 per share until March 30, 2022. As a result, 1,000,000 shares of the Company’s common stock and 1,000,000 Warrants were issued. On July 28, 2019, in connection with the Lookout Mountain LLC Agreement, the Company issued 3,367,441 units of the Company at a price of $0.08 to PM&G for cash proceeds to the Company of $269,395. Each unit of the offering consists of one share of common stock of the Company and one common share purchase Class H warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of $0.14 per share until March 30, 2022. As a result, 3,367,441 shares of the Company’s common stock and 3,367,441 Warrants were issued. On October 23, 2019, the at a price of US$0.08 per unit, for total proceeds to the Company of $600,000. Each unit consisted of one share of common stock of the Company and one-half common share purchase Class J warrant (each whole such warrant a “Warrant”), with each Warrant exercisable to acquire an additional share of common stock of the Company at a price of US$0.12 per share until the warrant expiration date of October 15, 2024. As a result, 7,500,000 shares of common stock of the Company and 3,750,000 Warrants were issued and 3,750,000 shares of common stock were reserved for issuance pursuant to Warrant exercises. A director of the Company On August 17, 2020, the Company closed a private placement offering with accredited investors for 33,636,364 units of the Company at a price of US$0.11 per unit, for total proceeds to the Company of $3,700,000. Each unit consisted of one share of common stock of the Company and one common share purchase Class L Warrant, with each warrant exercisable to acquire an additional share of common stock of the Company at a price of US$0.20 per share until the warrant expiration date of August 15, 2023. The Company incurred total costs of $102,000 related to this financing. As a result, 33,636,364 shares of common stock of the Company and 33,636,364 warrants were issued and 33,636,364 shares of common stock were reserved for issuance pursuant to warrant exercises. Two directors of the Company , William Matlack and Steven Osterberg, participated in the offering and subscribed for 909,091 units for total proceeds of $100,000. The warrants comprised in Mr. Matlack’s units contain a voluntary restriction on exercise preventing Mr. Matlack from completing any warrant exercise if such exercise would cause him to beneficially own or control 20% or more of the issued and outstanding common shares of Timberline. Warrants During the fiscal year ended September 30, 2020, 37,386,362 warrants were issued pursuant to two separate private placement offerings. In addition, 4,000,000 warrants were issued and 3,265,500 warrants were canceled as part of the restructure of a senior unsecured debt financing (See Note 6. A total of 3,543,600 warrants were exercised. Total warrants of 8,000,000 and 9,960,006 expired during the fiscal years ended September 30, 2020 and 2019, respectively. There were 75,634,670 and 49,057,408 warrants outstanding as of September 30, 2020 and 2019, respectively. The relative fair value of the warrants issued in connection with the extended senior unsecured note was estimated at $94,300, based upon a total fair value as calculated by a Black-Scholes option-pricing model. Fair values of warrants issued with equity transactions was recorded as recorded to Additional paid-in capital. The valuation model used the following inputs: Warrants Issued During the Year Ended September 30, 2020 Warrants Issued During the Year Ended September 30, 2019 Expected volatility 147.2% - 171.6% 138.5% Stock price on date of the note $0.07 - $0.11 $0.07 Exercise price $0.08 - $0.20 $0.07 Expected dividends - - Expected term (in years) 3.0 -3.333 1.5 Risk-free rate 0.667% - 1.34% 2.26% Expected forfeiture rate 0% 0% The following is a summary of warrants as of September 30, 2020: Shares Exercise Price ($) Expiration Date Class B Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 8,000,000 0.40 January 31, 2020 Outstanding and exercisable at September 30, 2019 8,000,000 Expired January 31, 2020 (8,000,000) Outstanding and exercisable at September 30, 2020 - Class C Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 2,880,867 0.45 October 31, 2022 Outstanding and exercisable at September 30, 2019 2,880,867 Outstanding and exercisable at September 30, 2020 2,880,867 Class D Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 7,500,000 0.14 April 30, 2021 Outstanding and exercisable at September 30, 2019 7,500,000 Outstanding and exercisable at September 30, 2020 7,500,000 Class D-2 Warrants: (Issued for Mineral Property Purchase) Outstanding and exercisable at September 30, 2018 5,000,000 0.24 May 23, 2021 Outstanding and exercisable at September 30, 2019 5,000,000 Outstanding and exercisable at September 30, 2020 5,000,000 Class E Warrants: (Issued for Private Placement) Warrants Issued November 9, 2018 7,500,000 0.14 October 29, 2021 Outstanding and exercisable at September 30, 2019 7,500,000 Outstanding and exercisable at September 30, 2020 7,500,000 Class F Warrants: (Issued for Unsecured Senior Note) Outstanding and exercisable at September 30, 2018 3,265,500 0.09 February 1, 2023 Outstanding and exercisable at September 30, 2019 3,265,500 Exchanged for Series K warrants (3,265,500) Outstanding and exercisable at September 30, 2020 - Class G Warrants: (Issued for Mineral Property Purchase) Warrants Issued December 18, 2018 5,000,000 0.14 December 18, 2021 Outstanding and exercisable at September 30, 2019 5,000,000 Outstanding and exercisable at September 30, 2020 5,000,000 Class H Warrants: (Issued for Private Placement) Warrants Issued March 21, 2019 3,000,000 0.14 March 22, 2022 Warrants Issued July 25, 2019 3,367,441 Outstanding and exercisable at September 30, 2019 6,367,441 Outstanding and exercisable at September 30, 2020 6,367,441 Class I Warrants: (Issued for Unsecured Note Payable) Warrants Issued May 8, 2019 3,543,600 0.07 November 7, 2020 Outstanding and exercisable at September 30, 2019 3,543,600 Exercised (3,543,600) Outstanding and exercisable at September 30, 2020 - Class J Warrants: (Issued for Private Placement) Warrants Issued October 15, 2019 3,750,000 0.12 October 15, 2024 Outstanding and exercisable at September 30, 2020 3,750,000 Class K Warrants: (Issued for Extension of Unsecured Note Payable) Warrants Issued January 20, 2020 in exchange for Series F warrants 4,000,000 0.08 January 20, 2023 Outstanding and exercisable at September 30, 2020 4,000,000 Class L Warrants: (Issued for Private Placement) Warrants Issued August 15, 2020 33,636,362 0.20 August 15, 2023 Outstanding and exercisable at September 30, 2020 33,636,362 Warrants outstanding and weighted average exercise price at September 30, 2020 75,634,670 0.18 Preferred Stock The Company is authorized to issue up to 10,000,000 shares of preferred stock, $0.01 par value. The Company’s board of directors is authorized to issue the preferred stock from time to time in series, and is further authorized to establish such series, to fix and determine the variations in the relative rights and preferences as between series, to fix voting rights, if any, for each series, and to allow for the conversion of preferred stock into common stock. There is no preferred stock issued as of September 30, 2020 and 2019. |
Note 10 - Stock-based Awards
Note 10 - Stock-based Awards | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 10 - Stock-based Awards: | NOTE 10 – STOCK-BASED AWARDS: During the year ended September 30, 2015, the Company’s Board of Directors adopted and the Company’s stockholders approved the adoption of the Company’s 2015 Stock and Incentive Plan. The aggregate number of shares that may be issued to employees, directors, and consultants under all stock-based awards made under the 2015 Stock and Incentive Plan was 4 million shares of the Company’s common stock. Upon exercise of options or other awards, shares are issued from the available authorized shares of the Company. Option awards are granted with an exercise price equal to the fair value of the Company’s stock at the date of grant. During the year ended September 30, 2019, the Company’s shareholders approved and the Company’s Board of Directors adopted of the Company’s 2018 Stock and Incentive Plan. This plan replaced the Company’s 2015 Equity Incentive Plan. The aggregate number of shares that may be issued to employees, directors, and consultants under all stock-based awards made under the 2018 Stock and Incentive Plan is 8 million shares of the Company’s common stock. Upon exercise of options or other awards, shares are issued from the available authorized shares of the Company. Option awards are granted with an exercise price equal to the fair value of the Company’s stock at the date of grant. On January 17, 2019, the Company granted to the Chief Financial Officer stock options to acquire 100,000 shares of the Company’s common stock. The options vested immediately and are exercisable at a price of $0.10 per common share for a period of five years from the date of the grant. On October 29, 2019, the Company granted to directors and management stock options to acquire an aggregate of 2,450,000 shares of the Company’s common stock. The options vested immediately and are exercisable at a price of $0.08 per common share for a period of five years from the date of the grant. Also, on October 29, 2019, in connection with his appointment to the Board of Directors, Mr. Matlack was granted 100,000 options to acquire shares of the Company’s common stock. The options have an exercise price of $0.08 per share, vested immediately, and have a term of five years. The fair value of the option awards is measured on the date of the issuance with a Black-Scholes option-pricing model using the assumptions noted in the following table: Options Granted During the Year Ended September 30, 2020 Options Granted During the Year Ended September 30, 2019 Expected volatility 149.5 % 137.4 % Stock price on date of grant $ 0.07 $ 0.06 Exercise price $ 0.08 $ 0.10 Expected dividends - - Expected term (in years) 5 5 Risk-free rate 1.66 % 2.46 % Expected forfeiture rate 0 % 0 % Total compensation expense recognized for option awards was $161,100 and $5,000 for the years ended September 30, 2020 and 2019, respectively. The cost of options granted to employees is recorded as salaries and benefits, and the cost of options granted to directors and consultants is recorded as other general and administrative expenses. The total compensation cost of options vested under the plan, charged against operations, is included in the consolidated statements of operations as follows: Fiscal year ended September 30, 2020 2019 Salaries and benefits $ 72,100 $ - Other general and administrative expenses 89,000 5,000 Total $ 161,100 $ 5,000 The following is a summary of the Company’s options issued under the Amended 2005 Equity Incentive Plan, the 2015 Stock and Incentive Plan and the 2018 Stock and Incentive Plan: Options Weighted Average Exercise Price Outstanding at September 30, 2018 3,280,000 $ 0.26 Granted 100,000 0.10 Expired (100,000) (0.10) Outstanding at September 30, 2019 3,280,000 0.26 Granted 2,550,000 0.08 Expired (430,000) (0.43) Outstanding and exercisable at September 30, 2020 5,400,000 $ 0.09 Weighted average fair value of options granted during the fiscal year ended September 30, 2020 $ 0.06 Average remaining contractual term of options outstanding and exercisable at September 30, 2020 (years) 2.92 Intrinsic value of options outstanding and exercisable at September 30, 2020 $ 506,000 |
Note 11 - Commitments and Conti
Note 11 - Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 11 - Commitments and Contingencies: | NOTE 11 – COMMITMENTS AND CONTINGENCIES: Mineral Exploration A portion of the Company’s mining claims on the Company’s properties are subject to lease and option agreements with various terms, obligations, and royalties payable in certain circumstances. The Company pays federal and county claim maintenance fees on unpatented claims that are included in the Company’s mineral exploration properties. Should the Company continue to explore all of the Company’s mineral properties, it expects annual fees to total approximately $209,449 per year in the future. Real Estate Lease Commitments At September 30, 2020, the Company had real estate lease commitments for certain mineral properties totaling $72,000 annually. The Company’s office in Coeur d’Alene, Idaho and its facilities in Eureka, Nevada are rented on a month-to-month basis. |
Note 12 - Subsequent Events
Note 12 - Subsequent Events | 12 Months Ended |
Sep. 30, 2020 | |
Notes | |
Note 12 - Subsequent Events: | NOTE 12 – SUBSEQUENT EVENTS: On October 8, 2020, the Company granted a total of 1,100,000 options to purchase shares of the Company’s common stock that expire in five years with an exercise price of $0.27 in conjunction with the appointment of Patrick Highsmith as CEO (750,000 options), Mr. Steven Osterberg as VP-Exploration (250,000 options), and addition of Mr. Quinton Hennigh to the Board of Directors (100,000 options). All options vested immediately. Between November 18, 2020 and December 15, 2020, three nonrelated-party holders of Class D Warrants exercised a total of 950,000 warrants for $0.14 per share and received 950,000 shares of the Company’s common stock for total cash proceeds of $133,000 to the Company. |
Note 2 - Summary of Significa_2
Note 2 - Summary of Significant Accounting Policies: a. Basis of Presentation and Going Concern (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
a. Basis of Presentation and Going Concern | a. Basis of Presentation and Going Concern The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company has incurred losses since its inception. The Company has sufficient cash to fund normal operations and meet all of its obligations for the next 12 months without raising additional funds. However, we are an exploration company with exploration programs that require significant cash expenditures. A significant drilling program, such are those we have planned, can result in depletion of cash and return us to a position of insufficient cash to support normal operations for 12 months. The Company currently has no historical recurring source of revenue, and its ability to continue as a going concern is dependent on its ability to raise capital to fund future exploration and working capital requirements, or the Company’s ability to profitably execute its business plan. The Company’s plans for the long-term return to and continuation as a going concern include financing its future operations through sales of common stock and/or debt and the eventual profitable exploitation of its mining properties. While the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms acceptable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. If the going concern basis were not appropriate for these financial statements, adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses and the balance sheet classifications used. |
Note 2 - Summary of Significa_3
Note 2 - Summary of Significant Accounting Policies: b. New Accounting Pronouncements (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
b. New Accounting Pronouncements | b. In August 2020, the FASB issued ASU No. 2020-06 Debt - Debt With Conversion And Other Options (Subtopic 470-20) And Derivatives And Hedging - Contracts In Entity’s Own Equity (Subtopic 815-40): Accounting For Convertible Instruments And Contracts In An Entity’s Own Equity. The update simplifies the accounting for and disclosures related to company debt that is convertible or can be settled in a company’s own equity securities. The update is effective for fiscal years beginning after December 15, 2021. Management is evaluating the impact of this update on the Company’s debt disclosures. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. |
Note 2 - Summary of Significa_4
Note 2 - Summary of Significant Accounting Policies: c. Principles of Consolidation (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
c. Principles of Consolidation | c. Principles of Consolidation |
Note 2 - Summary of Significa_5
Note 2 - Summary of Significant Accounting Policies: d. Exploration Expenditures (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
d. Exploration Expenditures | d. Exploration Expenditures economically developed as a result of establishing proven and probable reserves, the costs incurred after such determination will be capitalized and amortized over their useful lives. To date, the Company has not established the commercial feasibility of its exploration prospects; therefore, all exploration costs are being expensed. |
Note 2 - Summary of Significa_6
Note 2 - Summary of Significant Accounting Policies: e. Property Holding Costs (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
e. Property Holding Costs | e. Property Holding Costs |
Note 2 - Summary of Significa_7
Note 2 - Summary of Significant Accounting Policies: f. Fair Value (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
f. Fair Value | f. Fair Value At September 30, 2020 and 2019, the Company had no assets or liabilities accounted for at fair value on a recurring basis or nonrecurring basis. The carrying amounts of financial instruments, including senior unsecured notes payable and the payment obligation, approximate fair value at September 30, 2020 and 2019. |
Note 2 - Summary of Significa_8
Note 2 - Summary of Significant Accounting Policies: g. Cash Equivalents (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
g. Cash Equivalents | g. Cash Equivalents |
Note 2 - Summary of Significa_9
Note 2 - Summary of Significant Accounting Policies: h. Reclamation Bonds (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
h. Reclamation Bonds | h. Reclamation Bonds |
Note 2 - Summary of Signific_10
Note 2 - Summary of Significant Accounting Policies: i. Estimates and Assumptions (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
i. Estimates and Assumptions | i. Estimates and Assumptions |
Note 2 - Summary of Signific_11
Note 2 - Summary of Significant Accounting Policies: j. Accounting for Investments in Joint Ventures (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
j. Accounting for Investments in Joint Ventures | j. Accounting for Investments in Joint Ventures – Accounting Standards Codification (“ASC”) 321 Investments – Equity Securities The Company recognizes as income funds that are received from distributions from net accumulated earnings of the joint venture. For joint ventures where the Company holds more than 50% of the voting interest and has significant influence, the joint venture is consolidated with the presentation of a non-controlling interest. In determining whether significant influence exists, the Company considers its participation in policy-making decisions and its representation on the venture’s management committee. The Company has no significant influence over its joint ventures, and therefore accounts for its investment using the cost less impairment basis. The Company periodically assesses its investments in joint ventures for impairment. If management determines that a decline in fair value is other than temporary it will write-down the investment and charge the impairment against operations. |
Note 2 - Summary of Signific_12
Note 2 - Summary of Significant Accounting Policies: k. Property and Equipment (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
k. Property and Equipment | k. Property and Equipment over the useful life of the assets. Gains or losses on disposition or retirement of property and equipment are recognized in operating expenses. |
Note 2 - Summary of Signific_13
Note 2 - Summary of Significant Accounting Policies: l. Carrying Value of Property, Mineral Rights and Equipment for Impairment (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
l. Carrying Value of Property, Mineral Rights and Equipment for Impairment | l. Carrying Value of Property, Mineral Rights and Equipment for Impairment |
Note 2 - Summary of Signific_14
Note 2 - Summary of Significant Accounting Policies: m. Asset Retirement Obligations (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
m. Asset Retirement Obligations | m. Asset Retirement Obligations – |
Note 2 - Summary of Signific_15
Note 2 - Summary of Significant Accounting Policies: n. Provision for Income Taxes (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
n. Provision for Income Taxes | n. Provision for Income Taxes |
Note 2 - Summary of Signific_16
Note 2 - Summary of Significant Accounting Policies: o. Translation of Foreign Currencies (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
o. Translation of Foreign Currencies | o. Translation of Foreign Currencies |
Note 2 - Summary of Signific_17
Note 2 - Summary of Significant Accounting Policies: p. Stock-based Compensation (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
p. Stock-based Compensation | p. Stock-based Compensation The value of common stock awards is determined based upon the closing price of the Company’s stock on the grant date of the award. Compensation expense for grants that vest is recognized ratably over the vesting period. The fair value of stock unit or stock awards is determined by the closing price of the Company’s common stock on the date of the grant. |
Note 2 - Summary of Signific_18
Note 2 - Summary of Significant Accounting Policies: q. Net Income (Loss) per Share (Policies) | 12 Months Ended |
Sep. 30, 2020 | |
Policies | |
q. Net Income (Loss) per Share | q, Net Income (Loss) per Share 2020 2019 Stock options 5,400,000 3,280,000 Warrants 75,634,670 49,057,408 Total potential dilution 81,034,670 52,337,408 At September 30, 2020 and 2019, the effect of the Company’s common stock equivalents would have been anti-dilutive. |
Note 2 - Summary of Signific_19
Note 2 - Summary of Significant Accounting Policies: q. Net Income (Loss) per Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | 2020 2019 Stock options 5,400,000 3,280,000 Warrants 75,634,670 49,057,408 Total potential dilution 81,034,670 52,337,408 |
Note 3 - Property, Mineral Ri_2
Note 3 - Property, Mineral Rights, and Equipment: Property, Plant and Equipment (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Property, Plant and Equipment | Expected Useful Lives (years) 2020 2019 Mineral rights – Eureka - $ 13,701,178 $ 13,703,651 Mineral rights – Elder Creek - - 1,218,715 Mineral rights – Other - 55,000 50,000 Total mineral rights 13,756,178 14,972,366 Equipment and vehicles 2-5 53,678 53,678 Office equipment and furniture 3-7 70,150 70,150 Land - 51,477 51,477 Total property and equipment 175,305 175,305 Less accumulated depreciation (123,828) (123,828) Property, mineral rights, and equipment, net $ 13,807,655 $ 15,023,843 |
Note 3 - Property, Mineral Ri_3
Note 3 - Property, Mineral Rights, and Equipment: Schedule of net book values of acquired assets (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of net book values of acquired assets | Net Asset Value on July 29, 2020 Cash $ 29,770 Advance to the Company 205,194 Mineral properties 7,637,403 Net Assets 7,872,367 Eliminated upon consolidation: Investment in LM LLC (7,354,810) Advance from LM LLC (205,194) $ 312,363 |
Note 6 - Senior Unsecured Not_2
Note 6 - Senior Unsecured Note Payable: Schedule of fair value (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Series K and Series F Warrants | |
Schedule of fair value | Series K Warrants Issued October 4, 2019 Series F Warrants Canceled October 4, 2019 Expected volatility 147.20% 147.20% Stock price on date of grant $0.07 $0.07 Exercise price $0.08 $0.09 Expected dividends - - Expected term (in years) 3.333 3.333 Risk-free rate 1.34% 1.34% Expected forfeiture rate 0% 0% |
Warrants issued | |
Schedule of fair value | Warrants Issued During the Year Ended September 30, 2019 Expected volatility 138.5% Stock price on date of the note $0.07 Exercise price $0.07 Expected dividends - Expected term (in years) 1.5 Risk-free rate 2.26% Expected forfeiture rate 0% |
Note 7 - Asset Retirement Obl_2
Note 7 - Asset Retirement Obligation: Schedule of Asset Retirement Obligations (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of Asset Retirement Obligations | 2020 2019 Beginning balance $ 168,619 $ 160,588 Change in ARO estimate (80,435) - Accretion expense 24,431 8,031 Ending balance $ 112,615 $ 168,619 |
Note 8 - Income Taxes_ Schedule
Note 8 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of Deferred Tax Assets and Liabilities | Timberline Resources Corp. 2020 2019 Net deferred tax assets: Exploration costs $ 190,000 $ 32,000 Investments in subsidiaries 184,000 184,000 Share-based compensation 1,460,000 1,452,000 Alternative minimum tax credit carryforwards - 2,000 Foreign income tax credit carryforwards - 697,000 Federal and state net operating loss carryforwards 11,408,000 10,792,000 Foreign net operating loss carryforwards 1,736,000 1,736,000 Total deferred tax asset 14,978,000 14,895,000 Valuation allowance (14,978,000) (14,895,000) Net deferred tax asset $ - $ - BH Minerals USA, Inc. Net deferred tax assets (liabilities): Property, mineral rights, and equipment $ (2,302,000) $ (2,290,000) Exploration costs 479,000 572,000 Federal and state net operating loss carryforwards 3,871,000 3,597,000 Total deferred tax asset 2,048,000 1,879,000 Valuation allowance (2,048,000) (1,879,000) Net deferred tax asset $ - $ - |
Note 8 - Income Taxes_ Schedu_2
Note 8 - Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of Effective Income Tax Rate Reconciliation | 2020 2019 Net Loss $ (3,377,000) $ (1,657,000) Statutory Federal income tax rate 24.5% 24.5% Expected income tax benefit based on statutory rate (827,000) (406,000) Effect of state taxes 51,000 56,000 Expiration of foreign tax credit 697,000 - Taxable loss from unconsolidated entity (46,000) - Change in valuation allowance 252,000 77,000 Prior year change in estimates (127,000) 273,000 Income tax provision $ - $ - |
Note 9 - Common Stock, Warran_2
Note 9 - Common Stock, Warrants and Preferred Stock: Schedule of fair value (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Warrants | |
Schedule of fair value | Warrants Issued During the Year Ended September 30, 2020 Warrants Issued During the Year Ended September 30, 2019 Expected volatility 147.2% - 171.6% 138.5% Stock price on date of the note $0.07 - $0.11 $0.07 Exercise price $0.08 - $0.20 $0.07 Expected dividends - - Expected term (in years) 3.0 -3.333 1.5 Risk-free rate 0.667% - 1.34% 2.26% Expected forfeiture rate 0% 0% |
Note 9 - Common Stock, Warran_3
Note 9 - Common Stock, Warrants and Preferred Stock: Schedule of Stockholders' Equity Note, Warrants or Rights (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Schedule of Stockholders' Equity Note, Warrants or Rights | Shares Exercise Price ($) Expiration Date Class B Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 8,000,000 0.40 January 31, 2020 Outstanding and exercisable at September 30, 2019 8,000,000 Expired January 31, 2020 (8,000,000) Outstanding and exercisable at September 30, 2020 - Class C Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 2,880,867 0.45 October 31, 2022 Outstanding and exercisable at September 30, 2019 2,880,867 Outstanding and exercisable at September 30, 2020 2,880,867 Class D Warrants: (Issued for Private Placement) Outstanding and exercisable at September 30, 2018 7,500,000 0.14 April 30, 2021 Outstanding and exercisable at September 30, 2019 7,500,000 Outstanding and exercisable at September 30, 2020 7,500,000 Class D-2 Warrants: (Issued for Mineral Property Purchase) Outstanding and exercisable at September 30, 2018 5,000,000 0.24 May 23, 2021 Outstanding and exercisable at September 30, 2019 5,000,000 Outstanding and exercisable at September 30, 2020 5,000,000 Class E Warrants: (Issued for Private Placement) Warrants Issued November 9, 2018 7,500,000 0.14 October 29, 2021 Outstanding and exercisable at September 30, 2019 7,500,000 Outstanding and exercisable at September 30, 2020 7,500,000 Class F Warrants: (Issued for Unsecured Senior Note) Outstanding and exercisable at September 30, 2018 3,265,500 0.09 February 1, 2023 Outstanding and exercisable at September 30, 2019 3,265,500 Exchanged for Series K warrants (3,265,500) Outstanding and exercisable at September 30, 2020 - Class G Warrants: (Issued for Mineral Property Purchase) Warrants Issued December 18, 2018 5,000,000 0.14 December 18, 2021 Outstanding and exercisable at September 30, 2019 5,000,000 Outstanding and exercisable at September 30, 2020 5,000,000 Class H Warrants: (Issued for Private Placement) Warrants Issued March 21, 2019 3,000,000 0.14 March 22, 2022 Warrants Issued July 25, 2019 3,367,441 Outstanding and exercisable at September 30, 2019 6,367,441 Outstanding and exercisable at September 30, 2020 6,367,441 Class I Warrants: (Issued for Unsecured Note Payable) Warrants Issued May 8, 2019 3,543,600 0.07 November 7, 2020 Outstanding and exercisable at September 30, 2019 3,543,600 Exercised (3,543,600) Outstanding and exercisable at September 30, 2020 - Class J Warrants: (Issued for Private Placement) Warrants Issued October 15, 2019 3,750,000 0.12 October 15, 2024 Outstanding and exercisable at September 30, 2020 3,750,000 Class K Warrants: (Issued for Extension of Unsecured Note Payable) Warrants Issued January 20, 2020 in exchange for Series F warrants 4,000,000 0.08 January 20, 2023 Outstanding and exercisable at September 30, 2020 4,000,000 Class L Warrants: (Issued for Private Placement) Warrants Issued August 15, 2020 33,636,362 0.20 August 15, 2023 Outstanding and exercisable at September 30, 2020 33,636,362 Warrants outstanding and weighted average exercise price at September 30, 2020 75,634,670 0.18 |
Note 10 - Stock-based Awards_ S
Note 10 - Stock-based Awards: Summary of fair value of options issued and outstanding (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Options | |
Summary of fair value of options issued and outstanding | Options Granted During the Year Ended September 30, 2020 Options Granted During the Year Ended September 30, 2019 Expected volatility 149.5 % 137.4 % Stock price on date of grant $ 0.07 $ 0.06 Exercise price $ 0.08 $ 0.10 Expected dividends - - Expected term (in years) 5 5 Risk-free rate 1.66 % 2.46 % Expected forfeiture rate 0 % 0 % |
Note 10 - Stock-based Awards__2
Note 10 - Stock-based Awards: Share-based Payment Arrangement, Activity (Tables) | 12 Months Ended |
Sep. 30, 2020 | |
Tables/Schedules | |
Share-based Payment Arrangement, Activity | Fiscal year ended September 30, 2020 2019 Salaries and benefits $ 72,100 $ - Other general and administrative expenses 89,000 5,000 Total $ 161,100 $ 5,000 |
Note 10 - Stock-based Awards__3
Note 10 - Stock-based Awards: Share-based Compensation, Stock Options, Activity (Tables) | 12 Months Ended |
Sep. 30, 2019 | |
Tables/Schedules | |
Share-based Compensation, Stock Options, Activity | Options Weighted Average Exercise Price Outstanding at September 30, 2018 3,280,000 $ 0.26 Granted 100,000 0.10 Expired (100,000) (0.10) Outstanding at September 30, 2019 3,280,000 0.26 Granted 2,550,000 0.08 Expired (430,000) (0.43) Outstanding and exercisable at September 30, 2020 5,400,000 $ 0.09 Weighted average fair value of options granted during the fiscal year ended September 30, 2020 $ 0.06 Average remaining contractual term of options outstanding and exercisable at September 30, 2020 (years) 2.92 Intrinsic value of options outstanding and exercisable at September 30, 2020 $ 506,000 |
Note 2 - Summary of Signific_20
Note 2 - Summary of Significant Accounting Policies: a. Basis of Presentation and Going Concern (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Details | |
Substantial Doubt about Going Concern, Conditions or Events | The Company has incurred losses since its inception. The Company has sufficient cash to fund normal operations and meet all of its obligations for the next 12 months without raising additional funds. However, we are an exploration company with exploration programs that require significant cash expenditures. A significant drilling program, such are those we have planned, can result in depletion of cash and return us to a position of insufficient cash to support normal operations for 12 months. The Company currently has no historical recurring source of revenue, and its ability to continue as a going concern is dependent on its ability to raise capital to fund future exploration and working capital requirements, or the Company’s ability to profitably execute its business plan. |
Substantial Doubt about Going Concern, Management's Plans, Substantial Doubt Not Alleviated | The Company’s plans for the long-term return to and continuation as a going concern include financing its future operations through sales of common stock and/or debt and the eventual profitable exploitation of its mining properties. While the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms acceptable to the Company. |
Note 2 - Summary of Signific_21
Note 2 - Summary of Significant Accounting Policies: q. Net Income (Loss) per Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Details | ||
Stock options | 5,400,000 | 3,280,000 |
Warrants | 75,634,670 | 49,057,408 |
Total potential dilution | 81,034,670 | 52,337,408 |
Note 3 - Property, Mineral Ri_4
Note 3 - Property, Mineral Rights, and Equipment: Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | ||
Property, Plant and Equipment, Gross | $ 175,305 | $ 175,305 | |
Mineral Rights | 13,756,178 | 14,972,366 | |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (123,828) | (123,828) | |
Property, mineral rights, and equipment, net | [1] | 13,807,655 | 15,023,843 |
Mineral rights - Eureka | |||
Mineral Rights | 13,701,178 | 13,703,651 | |
Mineral rights - Elder Creek | |||
Mineral Rights | 0 | 1,218,715 | |
Mineral rights - Other | |||
Mineral Rights | 55,000 | 50,000 | |
Equipment and vehicles | |||
Property, Plant and Equipment, Gross | $ 53,678 | 53,678 | |
Equipment and vehicles | Minimum | |||
Expected Useful Lives (years) | 2 years | ||
Equipment and vehicles | Maximum | |||
Expected Useful Lives (years) | 5 years | ||
Office equipment and furniture | |||
Property, Plant and Equipment, Gross | $ 70,150 | 70,150 | |
Office equipment and furniture | Minimum | |||
Expected Useful Lives (years) | 3 years | ||
Office equipment and furniture | Maximum | |||
Expected Useful Lives (years) | 7 years | ||
Land | |||
Property, Plant and Equipment, Gross | $ 51,477 | $ 51,477 | |
[1] | NOTE 3 |
Note 3 - Property, Mineral Ri_5
Note 3 - Property, Mineral Rights, and Equipment (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Depreciation | $ 0 | $ 0 |
Abandonment of mineral rights | 1,218,715 | 48,500 |
Proceeds from lease of mineral rights | $ 110,487 | $ 102,791 |
Elder Creek | ||
Equity Method Investment, Description of Principal Activities | Timberline elected to terminate the agreement on the anniversary date | |
Lookout Mountain | ||
Equity Method Investment, Description of Principal Activities | On May 9, 2019, the Company entered into a non-binding Letter of Intent to form a Limited Liability Company (the “Agreement”) with PM & Gold Mines, Inc. (“PM&G”) for the advanced exploration, and if determined feasible, the development of the Company’s Lookout Mountain Gold Project | |
Stock Issued During Period, Shares, Other | 3,367,441 | |
Stock Issued During Period, Value, Acquisitions | $ 269,395 |
Note 3 - Property, Mineral Ri_6
Note 3 - Property, Mineral Rights, and Equipment: Schedule of net book values of acquired assets (Details) | Jul. 29, 2020USD ($) |
Details | |
Net book value - Cash | $ 29,770 |
Net book value - Advance to the Company | 205,194 |
Net book value - Mineral properties | 7,637,403 |
Net book value - Net Assets | 7,872,367 |
Net book value - Investment in LM LLC | (7,354,810) |
Net book value - Advance from LM LLC | (205,194) |
Net book value of assets | $ 312,363 |
Note 5 - Payment Obligation (De
Note 5 - Payment Obligation (Details) - USD ($) | Sep. 12, 2017 | Sep. 30, 2020 | Sep. 30, 2019 |
Details | |||
Debt Instrument, Description | On September 12, 2017, the Company entered into an agreement (the “Payment Agreement”) with a creditor (the “Creditor”) to pay by way of a payment plan an existing obligation of $250,000 (the “Payment Obligation”) related to a potential corporate transaction in 2015 that was not completed | ||
Payment obligation, additional | $ 52,970 | ||
Payment obligation | $ 0 | $ 178,533 |
Note 6 - Senior Unsecured Not_3
Note 6 - Senior Unsecured Note Payable (Details) - USD ($) | Jul. 30, 2018 | Sep. 12, 2017 | Sep. 30, 2020 | Sep. 30, 2019 |
Debt Instrument, Description | On September 12, 2017, the Company entered into an agreement (the “Payment Agreement”) with a creditor (the “Creditor”) to pay by way of a payment plan an existing obligation of $250,000 (the “Payment Obligation”) related to a potential corporate transaction in 2015 that was not completed | |||
Amortization of discount on senior unsecured notes payable | $ 72,634 | $ 100,121 | ||
Senior Unsecured Notes Payable, Transaction #1 | ||||
Debt Instrument, Issuance Date | Jul. 30, 2018 | |||
Debt Instrument, Description | loan agreement and promissory note with William Matlack | |||
Proceeds from Unsecured Notes Payable | $ 300,000 | |||
Debt Instrument, Face Amount | $ 300,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 18.00% | |||
Debt Instrument, Collateral | unsecured | |||
Debt Instrument, Maturity Date | Jan. 20, 2020 | |||
Debt Instrument, Payment Terms | repaid early without penalty | |||
Senior Unsecured Notes Payable, Transaction #2 | ||||
Debt Instrument, Issuance Date | Oct. 4, 2019 | |||
Debt Instrument, Description | agreement with the Lender to extend the due date | |||
Debt Instrument, Maturity Date | Jan. 20, 2023 | |||
Debt Instrument, Payment Terms | same terms as the original note | |||
Series F Warrants Canceled October 4, 2019 | ||||
Amortization of discount on senior unsecured notes payable | $ 25,111 | |||
Extinguishment of Debt, Amount | 195,611 | |||
Notes Payable | $ 300,000 | 274,889 | ||
Debt Instrument, Unamortized Discount | 25,111 | |||
Senior Unsecured Notes Payable, Transaction #3 | ||||
Debt Instrument, Issuance Date | May 8, 2019 | |||
Debt Instrument, Description | separate loan agreement and promissory note | |||
Debt Instrument, Face Amount | $ 250,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 18.00% | |||
Debt Instrument, Collateral | unsecured | |||
Debt Instrument, Maturity Date | Nov. 7, 2020 | |||
Debt Instrument, Payment Terms | may be repaid early without penalty | |||
Warrants Issued During the Year Ended September 30, 2019 | ||||
Amortization of discount on senior unsecured notes payable | $ 25,136 | |||
Notes Payable | 177,366 | |||
Debt Instrument, Unamortized Discount | $ 72,634 |
Note 6 - Senior Unsecured Not_4
Note 6 - Senior Unsecured Note Payable: Schedule of fair value (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Mar. 31, 2020 | |
Share Price | $ 0.05 | ||
Series K Warrants Issued October 4, 2019 | |||
Expected volatility | 147.20% | ||
Share Price | $ 0.07 | ||
Exercise price | $ 0.08 | ||
Expected dividends | $ 0 | ||
Expected term (in years) | 3 years 3 months 30 days | ||
Risk-free rate | 1.34% | ||
Expected forfeiture rate | 0.00% | ||
Series F Warrants Canceled October 4, 2019 | |||
Expected volatility | 147.20% | ||
Share Price | $ 0.07 | ||
Exercise price | $ 0.09 | ||
Expected dividends | $ 0 | ||
Expected term (in years) | 3 years 3 months 30 days | ||
Risk-free rate | 1.34% | ||
Expected forfeiture rate | 0.00% | ||
Warrants issued | |||
Expected volatility | 138.50% | ||
Share Price | $ 0.07 | ||
Exercise price | $ 0.07 | ||
Expected dividends | $ 0 | ||
Expected term (in years) | 1 year 6 months | ||
Risk-free rate | 2.26% | ||
Expected forfeiture rate | 0.00% |
Note 7 - Asset Retirement Obl_3
Note 7 - Asset Retirement Obligation: Schedule of Asset Retirement Obligations (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Details | ||
Asset Retirement Obligation, Beginning Balance | $ 168,619 | $ 160,588 |
Change in ARO estimate | (80,435) | 0 |
Accretion of asset retirement obligation | 24,431 | 8,031 |
Asset Retirement Obligation, Ending Balance | $ 112,615 | $ 168,619 |
Note 7 - Asset Retirement Obl_4
Note 7 - Asset Retirement Obligation (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Details | ||
Change in ARO estimate | $ (80,435) | $ 0 |
Note 8 - Income Taxes_ Schedu_3
Note 8 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
Timberline | ||
Deferred Tax Assets, Gross | $ 14,978,000 | $ 14,895,000 |
Valuation allowance | (14,978,000) | (14,895,000) |
Net deferred tax asset | 0 | 0 |
Timberline | Exploration costs | ||
Deferred Tax Assets, Gross | 190,000 | 32,000 |
Timberline | Investments in subsidiaries | ||
Deferred Tax Assets, Gross | 184,000 | 184,000 |
Timberline | Share-based compensation | ||
Deferred Tax Assets, Gross | 1,460,000 | 1,452,000 |
Timberline | Alternative minimum tax credit carryforwards | ||
Deferred Tax Assets, Gross | 0 | 2,000 |
Timberline | Foreign income tax credit carryforwards | ||
Deferred Tax Assets, Gross | 0 | 697,000 |
Timberline | Federal and state net operating loss carryforwards | ||
Deferred Tax Assets, Gross | 11,408,000 | 10,792,000 |
Timberline | Foreign net operating loss carryforwards | ||
Deferred Tax Assets, Gross | 1,736,000 | 1,736,000 |
BH Minerals | ||
Deferred Tax Assets, Gross | 2,048,000 | 1,879,000 |
Valuation allowance | (2,048,000) | (1,879,000) |
Net deferred tax asset | 0 | 0 |
BH Minerals | Exploration costs | ||
Deferred Tax Assets, Gross | 479,000 | 572,000 |
BH Minerals | Federal and state net operating loss carryforwards | ||
Deferred Tax Assets, Gross | 3,871,000 | 3,597,000 |
BH Minerals | Property, mineral rights, and equipment | ||
Property, mineral rights, and equipment | $ (2,302,000) | $ (2,290,000) |
Note 8 - Income Taxes_ Schedu_4
Note 8 - Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Details | ||
Net loss rounded for tax reporting purposes | $ (3,377,000) | $ (1,657,000) |
Statutory Federal income tax rate | 24.50% | 24.50% |
Effective Income Tax Rate Reconciliation at Federal Statutory Income Tax Rate, Amount | $ (827,000) | $ (406,000) |
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Amount | 51,000 | 56,000 |
Expiration of foreign tax credit | 697,000 | 0 |
Taxable loss from unconsolidated entity | (46,000) | 0 |
Change in valuation allowance | 252,000 | 77,000 |
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | (127,000) | 273,000 |
Income tax expense benefit rounded for tax reporting purposes | $ 0 | $ 0 |
Note 8 - Income Taxes (Details)
Note 8 - Income Taxes (Details) $ in Millions | Sep. 30, 2020USD ($) |
Timberline | |
Deferred Tax Assets, Operating Loss Carryforwards | $ 49.6 |
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | 4.8 |
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | 19.9 |
BH Minerals | |
Deferred Tax Assets, Operating Loss Carryforwards | 18.4 |
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | 2.6 |
In Canada | |
Deferred Tax Assets, Operating Loss Carryforwards | $ 6.7 |
Note 9 - Common Stock, Warran_4
Note 9 - Common Stock, Warrants and Preferred Stock (Details) - USD ($) | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Warrants | 75,634,670 | 49,057,408 | ||
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 | 10,000,000 | |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | |
Sale of Stock, Transaction #1 | ||||
Sale of Stock, Description of Transaction | Company closed two tranches of a private placement offering | |||
Common stock and warrants issued for cash, net | 7,500,000 | |||
Sale of Stock, Price Per Share | $ 0.08 | |||
Stock Issued | $ 600,000 | |||
Sale of Stock, Transaction #1 | Minimum | ||||
Sale of Stock, Transaction Date | Oct. 18, 2018 | |||
Sale of Stock, Transaction #1 | Maximum | ||||
Sale of Stock, Transaction Date | Dec. 3, 2018 | |||
Sale of Stock, Transaction #2 | ||||
Sale of Stock, Transaction Date | Mar. 29, 2019 | |||
Sale of Stock, Description of Transaction | Company closed the sale of 2,000,000 units, the first tranche of a private placement offering | |||
Sale of Stock, Price Per Share | $ 0.08 | |||
Stock Issued | $ 160,000 | |||
Sale of Stock, Transaction #3 | ||||
Sale of Stock, Transaction Date | Jun. 14, 2019 | |||
Sale of Stock, Description of Transaction | Company closed the sale of 1,000,000 units, the second tranche of a private placement offering | |||
Sale of Stock, Price Per Share | $ 0.08 | |||
Stock Issued | $ 80,000 | |||
Sale of Stock, Transaction #4 | ||||
Sale of Stock, Transaction Date | Jul. 28, 2019 | |||
Sale of Stock, Description of Transaction | Company issued 3,367,441 units of the Company | |||
Common stock and warrants issued for cash, net | 3,367,441 | |||
Sale of Stock, Price Per Share | $ 0.08 | |||
Stock Issued | $ 269,395 | |||
Sale of Stock, Transaction #5 | ||||
Sale of Stock, Transaction Date | Oct. 23, 2019 | |||
Sale of Stock, Description of Transaction | Company closed a private placement offering with accredited investors for 7,500,000 units of the Company | |||
Common stock and warrants issued for cash, net | 7,500,000 | |||
Sale of Stock, Price Per Share | $ 0.08 | |||
Stock Issued | $ 600,000 | |||
Sale of Stock, Transaction #6 | ||||
Sale of Stock, Transaction Date | Aug. 17, 2020 | |||
Sale of Stock, Description of Transaction | Company closed a private placement offering with accredited investors for 33,636,364 units of the Company | |||
Common stock and warrants issued for cash, net | 33,636,364 | |||
Sale of Stock, Price Per Share | $ 0.11 | |||
Stock Issued | $ 3,700,000 | |||
Sale of Stock, Transaction #7 | ||||
Sale of Stock, Description of Transaction | 37,386,362 warrants were issued pursuant to two separate private placement offerings | |||
Sale of Stock, Transaction #8 | ||||
Sale of Stock, Description of Transaction | [1] | 4,000,000 warrants were issued and 3,265,500 warrants were canceled as part of the restructure of a senior unsecured debt financing | ||
[1] | See Note 6 |
Note 9 - Common Stock, Warran_5
Note 9 - Common Stock, Warrants and Preferred Stock: Schedule of fair value (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Mar. 31, 2020 | |
Share Price | $ 0.05 | ||
Warrants | |||
Expected volatility | 138.50% | ||
Share Price | $ 0.07 | ||
Exercise price | $ 0.07 | ||
Expected dividends | $ 0 | $ 0 | |
Expected term (in years) | 1 year 6 months | ||
Risk-free rate | 2.26% | ||
Expected forfeiture rate | 0.00% | 0.00% | |
Warrants | Minimum | |||
Expected volatility | 147.20% | ||
Share Price | $ 0.07 | ||
Exercise price | $ 0.08 | ||
Expected term (in years) | 3 years | ||
Risk-free rate | 0.667% | ||
Warrants | Maximum | |||
Expected volatility | 171.60% | ||
Share Price | $ 0.11 | ||
Exercise price | $ 0.20 | ||
Expected term (in years) | 3 years 3 months 30 days | ||
Risk-free rate | 1.34% |
Note 9 - Common Stock, Warran_6
Note 9 - Common Stock, Warrants and Preferred Stock: Schedule of Stockholders' Equity Note, Warrants or Rights (Details) - $ / shares | Aug. 15, 2020 | Jan. 20, 2020 | Oct. 15, 2019 | May 08, 2019 | Mar. 21, 2019 | Dec. 18, 2018 | Nov. 09, 2018 | Sep. 30, 2018 | Sep. 30, 2020 | Jan. 31, 2020 | Sep. 30, 2019 | Jul. 25, 2019 |
Warrant exercise price | $ 0.18 | |||||||||||
Warrants outstanding | 75,634,670 | |||||||||||
Class B Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.40 | |||||||||||
Warrants expiration date | Jan. 31, 2020 | |||||||||||
Warrants outstanding and exercisable | 8,000,000 | 0 | 8,000,000 | |||||||||
Warrants expired | (8,000,000) | |||||||||||
Class C Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.45 | |||||||||||
Warrants expiration date | Oct. 31, 2022 | |||||||||||
Warrants outstanding and exercisable | 2,880,867 | 2,880,867 | 2,880,867 | |||||||||
Class D Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.14 | |||||||||||
Warrants expiration date | Apr. 30, 2021 | |||||||||||
Warrants outstanding and exercisable | 7,500,000 | 7,500,000 | 7,500,000 | |||||||||
Class D-2 Warrants: (Issued for Mineral Property Purchase) | ||||||||||||
Warrant exercise price | $ 0.24 | |||||||||||
Warrants expiration date | May 23, 2021 | |||||||||||
Warrants outstanding and exercisable | 5,000,000 | 5,000,000 | 5,000,000 | |||||||||
Class E Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.14 | |||||||||||
Warrants expiration date | Oct. 29, 2021 | |||||||||||
Warrants outstanding and exercisable | 7,500,000 | 7,500,000 | ||||||||||
Warrants issued | 7,500,000 | |||||||||||
Class F Warrants: (Issued for Unsecured Senior Note) | ||||||||||||
Warrant exercise price | $ 0.09 | |||||||||||
Warrants expiration date | Feb. 1, 2023 | |||||||||||
Warrants outstanding and exercisable | 3,265,500 | 0 | 3,265,500 | |||||||||
Warrants exchanged | (3,265,500) | |||||||||||
Class G Warrants: (Issued for Mineral Property Purchase) | ||||||||||||
Warrant exercise price | $ 0.14 | |||||||||||
Warrants expiration date | Dec. 18, 2021 | |||||||||||
Warrants outstanding and exercisable | 5,000,000 | 5,000,000 | ||||||||||
Warrants issued | 5,000,000 | |||||||||||
Class H Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.14 | |||||||||||
Warrants expiration date | Mar. 22, 2022 | |||||||||||
Warrants outstanding and exercisable | 6,367,441 | 6,367,441 | ||||||||||
Warrants issued | 3,000,000 | 3,367,441 | ||||||||||
Class I Warrants: (Issued for Unsecured Note Payable) | ||||||||||||
Warrant exercise price | $ 0.07 | |||||||||||
Warrants expiration date | Nov. 7, 2020 | |||||||||||
Warrants outstanding and exercisable | 0 | 3,543,600 | ||||||||||
Warrants issued | 3,543,600 | |||||||||||
Warrants exercised | (3,543,600) | |||||||||||
Class J Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.12 | |||||||||||
Warrants expiration date | Oct. 15, 2024 | |||||||||||
Warrants outstanding and exercisable | 3,750,000 | |||||||||||
Warrants issued | 3,750,000 | |||||||||||
Class K Warrants: (Issued for Extension of Unsecured Note Payable) | ||||||||||||
Warrant exercise price | $ 0.08 | |||||||||||
Warrants expiration date | Jan. 20, 2023 | |||||||||||
Warrants outstanding and exercisable | 4,000,000 | |||||||||||
Warrants issued | 4,000,000 | |||||||||||
Class L Warrants: (Issued for Private Placement) | ||||||||||||
Warrant exercise price | $ 0.20 | |||||||||||
Warrants expiration date | Aug. 15, 2023 | |||||||||||
Warrants outstanding and exercisable | 33,636,362 | |||||||||||
Warrants issued | 33,636,362 |
Note 10 - Stock-based Awards (D
Note 10 - Stock-based Awards (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Stock based compensation | $ 161,100 | $ 5,000 |
Stock-based Award #1 | ||
Sale of Stock, Transaction Date | Jan. 17, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 100,000 | |
Stock-based Award #2 | ||
Sale of Stock, Transaction Date | Oct. 29, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 2,450,000 |
Note 10 - Stock-based Awards__4
Note 10 - Stock-based Awards: Summary of fair value of options issued and outstanding (Details) - Options - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Expected volatility | 149.50% | 137.40% |
Exercise price | $ 0.08 | $ 0.10 |
Expected dividends | $ 0 | $ 0 |
Expected term (in years) | 5 years | 5 years |
Risk-free rate | 1.66% | 2.46% |
Expected forfeiture rate | 0.00% | 0.00% |
Note 10 - Stock-based Awards__5
Note 10 - Stock-based Awards: Share-based Payment Arrangement, Activity (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Details | ||
Salaries and benefits | $ 72,100 | $ 0 |
Other general and administrative expenses | 89,000 | 5,000 |
Total | $ 161,100 | $ 5,000 |
Note 10 - Stock-based Awards__6
Note 10 - Stock-based Awards: Share-based Compensation, Stock Options, Activity (Details) - $ / shares | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2017 | |
Details | |||
Outstanding | 5,400,000 | 3,280,000 | 3,280,000 |
Weighted Average Exercise Price, Outstanding | $ 0.09 | $ 0.26 | $ 0.26 |
Granted | 2,550,000 | 100,000 | |
Weighted Average Exercise Price, Granted | $ 0.08 | $ 0.10 | |
Expired | (100,000) | ||
Weighted Average Exercise Price, Expired | $ (0.43) | $ (0.10) | |
Terminated | (430,000) | ||
Weighted average fair value of options granted | $ 0.06 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 2 years 11 months 1 day | ||
Intrinsic value of options outstanding and exercisable | $ 506,000 |
Note 11 - Commitments and Con_2
Note 11 - Commitments and Contingencies (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Other Commitments, Description | At September 30, 2020, the Company had real estate lease commitments for certain mineral properties totaling $72,000 annually |
Commtment or Contingency #1 | |
Other Commitments, Description | A portion of the Company’s mining claims on the Company’s properties are subject to lease and option agreements |
Commtment or Contingency #2 | |
Other Commitments, Description | Company pays federal and county claim maintenance fees on unpatented claims that are included in the Company’s mineral exploration properties |
Note 12 - Subsequent Events (De
Note 12 - Subsequent Events (Details) | 12 Months Ended |
Sep. 30, 2020 | |
Event #1 | |
Subsequent Event, Date | Oct. 8, 2020 |
Subsequent Event, Description | Company granted a total of 1,100,000 options to purchase shares of the Company’s common stock |
Event #2 | |
Subsequent Event, Description | three nonrelated-party holders of Class D Warrants exercised a total of 950,000 warrants |
Event #2 | Minimum | |
Subsequent Event, Date | Nov. 18, 2020 |
Event #2 | Maximum | |
Subsequent Event, Date | Dec. 15, 2020 |