Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2022 | Nov. 14, 2022 | |
Details | ||
Registrant CIK | 0000851726 | |
Fiscal Year End | --06-30 | |
Registrant Name | SANTA FE GOLD CORPORATION | |
SEC Form | 10-Q | |
Period End date | Sep. 30, 2022 | |
Tax Identification Number (TIN) | 84-1094315 | |
Number of common stock shares outstanding | 443,308,551 | |
Filer Category | Non-accelerated Filer | |
Current with reporting | Yes | |
Interactive Data Current | Yes | |
Shell Company | false | |
Small Business | true | |
Emerging Growth Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-20430 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 2325 San Pedro NE | |
Entity Address, Address Line Two | Suite 225 | |
Entity Address, City or Town | Albuquerque | |
Entity Address, State or Province | NM | |
Entity Address, Postal Zip Code | 87110 | |
City Area Code | 505 | |
Local Phone Number | 255-4852 | |
Phone Fax Number Description | Registrant’s Telephone Number, including Area Code | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Current Assets | ||
Cash and cash equivalents | $ 65,703 | $ 19,939 |
Prepaid expenses and other current assets | 13,016 | 8,740 |
Total current assets | 78,719 | 28,679 |
Property and equipment, net | 421,764 | 432,118 |
Mineral property | 4,290,365 | 4,215,365 |
Deposit | 125 | 125 |
Assets held for sale | 25,800 | 202,821 |
Total Assets | 4,816,773 | 4,879,108 |
Current liabilities: | ||
Accounts payable | 3,799,234 | 3,812,836 |
Accrued liabilities | 12,137,934 | 12,385,090 |
Notes payable, current maturities | 2,352,671 | 2,343,635 |
Completion guaranty payable | 3,359,873 | 3,359,873 |
Total current liabilities | 21,649,712 | 21,901,434 |
Non-current notes payable | 501,876 | 510,786 |
Total Liabilities | 22,151,588 | 22,412,220 |
Stockholders' Deficit | ||
Common shares | 886,617 | 882,617 |
Additional paid-in capital | 96,692,220 | 96,558,521 |
Accumulated deficit | (114,913,652) | (114,974,250) |
Total stockholders' deficit | (17,334,815) | (17,533,112) |
Total Liabilities and Stockholders' Deficit | $ 4,816,773 | $ 4,879,108 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - $ / shares | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Common Stock, Par or Stated Value Per Share | $ 0.002 | $ 0.002 |
Common Stock, Shares Authorized | 550,000,000 | 550,000,000 |
Common Stock, Shares, Issued | 443,308,551 | 441,308,551 |
Common Stock, Shares, Outstanding | 443,308,551 | 441,308,551 |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Details | ||
Revenues | $ 0 | $ 0 |
Operating Expenses | ||
Exploration and other mine related costs | 26,175 | 38,560 |
General and administrative | 281,041 | 327,661 |
Total Operating Expenses | 307,216 | 366,221 |
Loss from Operations | (307,216) | (366,221) |
Other Nonoperating Income (Expense) | ||
Miscellaneous income | 172 | 0 |
Recovery (loss) associated with misappropriated funds | 4,057 | (522) |
Financing costs-commodity supply agreements | 538,750 | 75,481 |
Interest expense | (175,165) | (162,186) |
Total Other (Expense) Income | 367,814 | (87,227) |
Income (Loss) Before Provision for Income Taxes | 60,598 | (453,448) |
Provision for Income Taxes | 0 | 0 |
Net Income (Loss) | $ 60,598 | $ (453,448) |
Basic and Diluted Per Share Data | ||
Net Income (Loss) - Basic and diluted | $ 0 | $ 0 |
Weighted Average Common Shares Outstanding | ||
Basic | 441,504,203 | 435,446,486 |
Diluted | 496,070,845 | 435,446,486 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Deficit - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings | Total |
Stockholders' Equity Attributable to Parent, Beginning Balance at Jun. 30, 2021 | $ 866,037 | $ 95,759,064 | $ (112,640,158) | $ (16,015,057) |
Shares, Outstanding, Beginning Balance at Jun. 30, 2021 | 433,018,551 | |||
Proceeds from issuance of common stock | 208,500 | |||
Stock Issued During Period, Shares, New Issues | 4,170,000 | |||
Costs associated with issued warrants | $ 0 | 90,633 | 0 | 90,633 |
Net Income (Loss) | $ 0 | 0 | (453,448) | (453,448) |
Shares, Outstanding, Ending Balance at Sep. 30, 2021 | 437,188,551 | |||
Stockholders' Equity Attributable to Parent, Ending Balance at Sep. 30, 2021 | $ 874,377 | 96,049,857 | (113,093,606) | (16,169,372) |
Stock Issued During Period, Value, New Issues | 8,340 | 200,160 | 0 | $ 208,500 |
Common Stock, Shares, Issued | 441,308,551 | |||
Stockholders' Equity Attributable to Parent, Beginning Balance at Jun. 30, 2022 | $ 882,617 | 96,558,521 | (114,974,250) | $ (17,533,112) |
Shares, Outstanding, Beginning Balance at Jun. 30, 2022 | 441,308,551 | |||
Proceeds from issuance of common stock | 100,000 | |||
Stock Issued During Period, Shares, New Issues | 2,000,000 | |||
Costs associated with issued warrants | $ 0 | 37,699 | 0 | 37,699 |
Net Income (Loss) | $ 0 | 0 | 60,598 | 60,598 |
Shares, Outstanding, Ending Balance at Sep. 30, 2022 | 443,308,551 | |||
Stockholders' Equity Attributable to Parent, Ending Balance at Sep. 30, 2022 | $ 886,617 | 96,692,220 | (114,913,652) | (17,334,815) |
Stock Issued During Period, Value, New Issues | $ 4,000 | $ 96,000 | $ 0 | $ 100,000 |
Common Stock, Shares, Issued | 443,308,551 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Details | ||
Net Income (Loss) | $ 60,598 | $ (453,448) |
Adjustments to Reconcile Net Income (Loss) to Cash Provided by (Used in) Operating Activities | ||
Warrant/option expense from derivative liability | 37,699 | 90,633 |
Depreciation and amortization | 11,422 | 16,008 |
Non-cash interest expense | 0 | 276 |
Non-cash change in finance charge on commodity supply agreement | (538,750) | (75,481) |
Non-cash adjustment on recovery of misappropriated funds | 0 | 522 |
Net change in operating assets and liabilities | ||
Prepaid expenses and other current assets | (4,276) | (11,668) |
Increase (Decrease) in Accounts Payable and Accrued Liabilities | 278,118 | 246,613 |
Net Cash Provided by (Used in) Operating Activities | (155,189) | (186,545) |
Net Cash Provided by (Used in) Investing Activities | ||
Payment on mineral leases | (75,000) | (75,000) |
Loss on property sale | 943 | 0 |
Proceeds from property sale | 176,078 | 37,478 |
Rental deposit | 0 | (125) |
Purchase of property, plant and equipment | (1,068) | 0 |
Net Cash Provided by (Used in) Investing Activities | 100,953 | (37,647) |
Net Cash Provided by (Used in) Financing Activities | ||
Proceeds from issuance of common stock | 100,000 | 208,500 |
Payments on lease principle | 0 | (2,919) |
Net Cash Provided by (Used in) Financing Activities | 100,000 | 205,581 |
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents, Period Increase (Decrease), Excluding Exchange Rate Effect | 45,764 | (18,611) |
Cash and cash equivalents | 19,939 | 27,458 |
Cash and cash equivalents | 65,703 | 8,847 |
Supplemental Cash Flow Information | ||
Interest Paid, Including Capitalized Interest, Operating and Investing Activities | 0 | 1,649 |
Income Taxes Paid, Net | $ 0 | $ 0 |
NOTE 1 - NATURE OF OPERATIONS
NOTE 1 - NATURE OF OPERATIONS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 1 - NATURE OF OPERATIONS | NOTE 1 – NATURE OF OPERATIONS Santa Fe Gold Corporation (the “Company”, “our” or “we”) is a U.S. mining company incorporated in Delaware in August 1991. Our general business strategy is to acquire, explore, develop and mine mineral properties. The Company elected on August 26, 2015, to file for Chapter 11 Bankruptcy protection, Case # 15-11761 (MFW) and that case was dismissed on June 15, 2016. The Summit Silver-Gold Project, the Lordsburg Copper Project, Black Canyon Mica Project, Planet MIO Project, all claims and other assets were lost in the process. After the Company emerged from the bankruptcy with a management team of two with no assets, we developed a business plan to raise equity funds to acquire new mining claims, a potential processing plant or arrangements with a processing plant in an acceptable geographic location to potential new mining claims. In August 2017, the Company acquired all the capital stock of Bullard’s Peak Corporation and the related patented and unpatented claims in the Black Hawk district of New Mexico from Black Hawk Consolidated Mines Company for a purchase price of $3,115,365. The mine property is known as the Alhambra mine site. The transaction was finalized and closed in April 2019. The mining property acquired is an asset in our subsidiary, Mineral Acquisitions, LLC. In January 2019 the Company has acquired right of use on two properties in western New Mexico, consisting of eight (8) patented claims and two unpatented claims, all located in the Steeple Rock Mining District, Grant County, New Mexico and the related water rights lease agreements. The two properties are known as the Billali Mine and the Jim Crow Imperial Mine. The Company has made improvements to the Jim Crow Imperial mine and has commenced mining operations during the third calendar quarter of 2020. In the last week of November 2020, our mine manager contacted the COVID-19 virus and later two of our employee miners contacted it also and we shut the mining operation down and currently the mines and equipment are under a maintenance protocol. Currently it is anticipated to reopen the mines in late 2022 or in the first quarter of 2023 when we complete the construction of our mill operation in Duncan, Arizona. The Company has no current COVID-19 problems. We are considered an “exploration stage” company under the U.S. Securities and Exchange Commission (“SEC”) S-K 1300. The mining leases and other mineral rights we have control of, however, none of them contain any proven or probable reserves, as defined under S-K 1300. As such, they are all currently considered “exploratory” in nature. The new S-K 1300 guide replaced SEC Guide 7 and went into effect for the Company beginning with our fiscal year July 1, 2021. We are now required to file our Forms 10-Q and 10-K reports with the Commission aligned to S-K 1300 requirements. S-K 1300 is aligned more closely to CRIRSC definitions and shares similarities with, but not equal to, other reporting codes applicable to the mining industry such as NI 43-101. Covid-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. At this time, we cannot foresee whether the outbreak of COVID-19 will continue be effectively contained, nor can we predict the severity and duration of its impact. If the outbreak of COVID-19 or other infectious viruses are not effectively and timely controlled, our business plans and financial condition may be materially and adversely affected as a result of the potential deteriorating economic outlook or other factors that we cannot foresee. Any of these factors and other factors beyond our control could have an adverse effect on the overall business environment and cause our business to suffer in ways that we cannot predict at this time and that may materially and adversely impact our business plans, financial condition and results of operations. With three of our mine employees contacted the COVID-19 virus in the last week of November 2020, we shut the mining operation down and currently the mines and equipment are under a maintenance protocol. With the current COVID -19 situation and the current inability to process the mined ore we anticipate not restarting the mining operation until late 2022 or in the first quarter of 2023, depending on the projected completion of our mill operation in Duncan, Arizona. At this time, we cannot foresee whether the potential COVID-19 or any other variants that may affect our future operations, nor if an occurrence should happen, can we predict the severity and duration of its impact. Our business plans and financial condition may be materially and adversely affected as a result of the potential deteriorating economic outlook or other factors that we cannot foresee. Any of these factors and other factors beyond our control could have an adverse effect on the overall business environment and cause our business to suffer in ways that we cannot predict at this time and that may materially and adversely impact our business plans, financial condition and results of future operations. Currently, COVID-19 and any variants has had no additional effect on the Company. |
NOTE 2 - SUMMARY OF SIGNIFICANT
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Liquidity and Going Concern The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. Should the Company be unable to continue as a going concern, it may be unable to realize the carrying value of its assets and to meet its liabilities as they become due. Below presents summary financial information at the two periods presented in this Form 10-Q filing. September 30, June 30, 2022 2022 Cash on hand $ 65,703 $ 19,939 Working capital (deficit) $ (21,570,993 ) $ (21,872,755 ) Stockholder (deficit) $ (17,334,815 ) $ (17,533,112 ) September 30, 2021 Current quarter net income (loss) $ 60,598 $ (453,448 ) On August 26, 2015, Santa Fe filed for Chapter 11 Bankruptcy protection, Case # 15-11761 (MFW) in Delaware. With the dismissal of our bankruptcy case in June 15, 2016, all assets of the Company were sold. These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern. To continue as a going concern, the Company is dependent on continued capital financing for project development, repayment of various debt facilities and payment of current operating expenses until the Company has constructed its mill operation and implemented ore production at our mine sites to process the mineralized ore to generate revenue. We have no commitment from any party to provide additional working capital and there is no assurance that any funding will be available as required, or if available, that its terms will be favorable or acceptable to the Company. As of the periods ending September 30, 2022 and June 30, 2022, the Company was in default on accounts payable and debt facility payments that relate to our pre-bankruptcy debt as follows: September 30, June 30, 2022 2022 Amount due under the Gold Stream Agreement $9,884,977 $10,379,629 Notes payable and accrued interest 5,847,572 5,736,243 Accounts payable and other accrued liabilities 3,669,213 3,663,249 Total $19,401,762 $19,779,121 Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries AZCO Mica, Inc., a Delaware corporation, The Lordsburg Mining Company, a New Mexico corporation, Santa Fe Gold Barbados Corporation, a Barbados corporation, Santa Fe Acquisitions Company, a New Mexico Limited Liability Company, Minerals Acquisitions, LLC, a New Mexico Limited Liability Company and Bullard’s Peak Corporation, a New Mexico corporation. All significant inter-company accounts and transactions have been eliminated in consolidation. Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates under different assumptions or conditions. Significant estimates are used when accounting for the Company’s carrying value of mineral properties, useful life of fixed assets, depreciation and amortization, accruals, derivative instrument liabilities, taxes and contingencies, asset retirement obligations, revenue recognition, and stock-based compensation which are discussed in the respective notes to the consolidated financial statements. Fair Value of Financial Instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”) and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. A slight change in unobservable inputs such as volatility can significantly have a significant impact on the fair value measurement of the derivatives liabilities. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values because of the short maturity of these instruments. Cash and Cash Equivalents The Company considers all liquid investments purchased with an initial maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash balances. Property and Equipment Property is carried at cost. The cost of repairs and maintenance are expensed as incurred and major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows. Vehicles 5 years Mine equipment 7 years General equipment 3-7 years Small tools 1.25 years Mine Development Mine development costs include engineering and metallurgical studies, drilling, and other related costs to delineate an ore body, and the building of access ways, shafts, lateral access, drifts, ramps and other infrastructure in an underground mine. Costs incurred before mineralization is classified as proven and probable reserves are expensed and classified as exploration expense. Capitalization of mine development project costs, that meet the definition of an asset, begins once mineralization is classified as proven and probable reserves. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information on the ore body or converting non-reserve mineralization to proven and probable reserves. All other drilling and related costs are expensed as incurred. Drilling costs incurred during the production phase for operational ore control are allocated to inventory costs and then included as a component of costs applicable to sales. Mine development is amortized using the units-of-production method based upon estimated recoverable ounces in proven and probable reserves. To the extent that these costs benefit an entire ore body, they are amortized over the estimated life of the ore body. Costs incurred to access specific ore blocks or areas that only provide benefit over the life of that area are amortized over the estimated life of that specific ore body. Currently, with no claims or mines in our possession that have proven and probable reserves, we have no development costs incurred. As of September 30, 2022, the Company has not established proven or probable reserves or established the commercial feasibility of any of our exploration projects in the opinion of a qualified person as defined in Regulation S-K 1300 and all mine development costs are expensed as incurred. Mineral Rights Mineral properties are capitalized at their fair value at the acquisition date, either as an individual asset purchase or as part of a business combination. When it is determined that a mineral property can be economically developed as a result of establishing reserves, subsequent mine development is capitalized and are amortized using the units of production method over the estimated life of the ore body based on estimated recoverable tonnage in proven and probable reserves. The Company’s mineral rights generally are enforceable regardless of whether proven and probable reserves have been established. The Company has the ability and intent to renew mineral interests where the existing term is not sufficient to recover all identified and valued proven and probable reserves and/or undeveloped mineralized material. Costs of exploration, carrying and retaining unproven mineral lease properties are expensed as incurred. The Company expenses all mineral exploration costs as incurred as it is still in the exploration stage. If the Company identifies proven and probable reserves in its investigation of its properties and upon development of a plan for operating a mine, it would enter the development stage and capitalize future costs until production is established. When a property reaches the production stage, the related capitalized costs are amortized on a units-of-production basis over the proven and probable reserves following the commencement of production. The Company assesses the carrying costs of the capitalized mineral properties for impairment under ASC 360-10, “Impairment of long-lived assets”, and evaluates the carrying value under ASC 930-360, “Extractive Activities - Mining”, annually. An impairment is recognized when the sum of the expected undiscounted future cash flows is less than the carrying amount of the mineral properties. Impairment losses, if any, are measured as the excess of the carrying amount of the mineral properties over its estimated fair value. To date, the Company has not established the economically viability of any of our exploration prospects as defined under Regulation S-K, therefore, all exploration costs are expensed as incurred. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. The Company did not recognize any impairment during the three months ended September 30, 2022 and 2021. Reclamation and Asset Retirement Obligation Reclamation obligations (“ARO”) are recognized when incurred and recorded as liabilities at fair value. The liability is accreted over time through periodic charges to accretion expense. The asset retirement cost is capitalized as part of the asset’s carrying value and depreciated over the life of the related asset. Reclamation costs are periodically adjusted to reflect changes in the estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs. The reclamation obligation is based on when spending for an existing disturbance will occur. The Company reviews, on an annual basis, unless otherwise deemed necessary, the reclamation obligation at each mine site in accordance with ASC guidance for reclamation obligations. No reclamation costs were required for the three months ended September 30, 2022 and 2021. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. From time to time, the Company reviews the terms of convertible debt, equity instruments and other financing arrangements to determine whether there are embedded derivative instruments, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Also, in connection with the issuance of financing instruments, the Company may issue freestanding options or warrants that may, depending on their terms, be accounted for as derivative instrument liabilities, rather than as equity. The Company may also issue options or warrants to non-employees in connection with consulting or other services. Derivative financial instruments are initially measured at their fair value. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. To the extent that the initial fair values of the freestanding and/or bifurcated derivative instrument liabilities exceed the total proceeds received, an immediate charge to income is recognized as a one-day derivative loss, in order to initially record the derivative instrument liabilities at their fair value. The discount from the face value of convertible debt or equity instruments resulting from allocating some or all of the proceeds to the derivative instruments, together with the stated interest on the instrument, is amortized over the life of the instrument through periodic charges to income, using the effective interest method. When required to arrive at the fair value of derivatives associated with the convertible notes and warrants, a Black Scholes or Monte Carlo model are utilized that values the Convertible Note and Warrant based on average discounted cash flow factoring in the various potential outcomes by a Chartered Financial Analyst (‘CFA”). In determining the fair value of the financial derivatives, the CFA assumes that the Company’s business would be conducted as a going concern. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period. If reclassification is required, the fair value of the derivative instrument, as of the determination date, is reclassified. Any previous charges or credits to income for changes in the fair value of the derivative instrument are not reversed. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. Leases In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with a term of more than one year. Accounting by lessors will remain similar to existing U.S. GAAP. Subsequent accounting standards updates have been issued, which amend and/or clarify the application of ASU 2016-02. For the purposes of recognizing ROU assets and lease liabilities associated with the Company’s leases, the Company has elected the practical expedient to not recognize a ROU asset or lease liability for short-term leases, which are leases with a term of twelve months or less. The lease term is defined as the noncancelable portion of the lease term plus any periods covered by an option to extend the lease if it is reasonably certain that the option will be exercised. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company adopted Topic 842 as of July 1, 2019 and at this time the standard will not have a significant impact on our consolidated financial statements until a significant lease agreement is entered. Warrants In connection with certain financing, the Company has issued warrants to purchase shares of its common stock. The outstanding warrants are standalone instruments that are not puttable or mandatorily redeemable by the holder and are classified as equity awards. The Company measures the fair value of the awards using the Black-Scholes option pricing model as of the measurement date. Warrants are recorded at fair value as expense over the requisite service period or at the date of issuance, if there is not a service period. The Company assessed the classification of its common stock purchase warrants as of the date of each equity offering and determines that such instruments meet the criteria for equity classification, as the settlement terms indicate that the instruments are indexed to the entity’s underlying stock. Warrant and option expense for the three months ended September 30, 2022 and 2021 was $37,699 and $90,633, respectively. Income Taxes The Company accounts for income taxes using the asset and liability approach, which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of such assets and liabilities. This method utilizes enacted statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. A valuation allowance is recorded when it is more likely than not that deferred tax assets will be unrealizable in future periods. As of September 30, 2022 and June 30, 2022, the Company has recorded a valuation allowance against the full amount of its net deferred tax assets. The inability to foresee taxable income in future years makes it more likely than not that the Company will not realize its recorded deferred tax assets in future periods. Net Earnings (Loss) Per Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive for the three months ended September 30, 2021. For three months ended September 30, 2022 the calculations of basic and diluted loss per share are presented below. The potentially dilutive securities consisted of the following for the period ended September 30, 2022: September 30, 2022 Options to purchase common stock 40,000,000 Warrants to purchase common stock 15,468,816 A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation for the three months ended September 30, 2022 is as follows: Net Income (Numerator) Weighted Average Common Shares (Denominator) Per Share Amount For the three months ended September 30, 2022: Basic EPS Income available to common stockholders $ 60,598 441,504,203 $ 0.00 Diluted EPS Dilutive shares from options and warrants — 54,566,642 0.00 Income available to common stockholders plus assumed conversions $ 60,598 496,070,845 $ 0.00 Stock-Based Compensation In connection with terms of employment with the Company’s executives and employees, the Company occasionally issues options to acquire its common stock. Awards are made at the discretion of the Board of Directors. Such options may be exercisable at varying exercise prices and generally vested upon date of grant or may vest over a period of six months to a year. The Company accounts for option-based compensation on the grant date fair value of the award. The Company estimates the fair value of the award using the Black-Scholes option pricing model for valuation of the share-based payments. The Company believes this model provides the best estimate of fair value due to its ability to incorporate inputs that change over time, such as volatility and interest rates, and to allow for actual exercise behavior of option holders. The compensation cost is recognized over the expected vesting period. The Company has adopted the provisions of FASB ASC 718, “Stock Compensation” (“ASC 718”), which establishes accounting for equity instruments exchanged for employee services. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity grant). New shares of the Company’s common stock are issued for any options exercised. Share based payments to employees and nonemployees are valued at the earlier or a commitment date or completion of services. The Company had no stock-based compensation for the three-months ended September 30, 2022 and 2021. Recent Accounting Pronouncements Recent effective pronouncements issued by the FASB (including its Emerging Issues Task Force, or pronouncements issued but not yet effective, are not believed by management to, have a material impact on the Company's present or future financial position, results of operations or cash flows. |
NOTE 3 - PROPERTY AND EQUIPMENT
NOTE 3 - PROPERTY AND EQUIPMENT | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 3 - PROPERTY AND EQUIPMENT | NOTE 3 – PROPERTY AND EQUIPMENT Property and equipment consist of the following at September 30, 2022 and June 30, 2022: September 30, June 30, 2022 2022 Mine equipment $ 146,399 $ 146,399 General equipment 160,081 160,081 Small tools 4,882 4,882 Mill site property 175,343 175,343 Mill site development costs 35,134 35,134 Land 35,000 35,000 Office equipment 1,068 - 557,907 556,839 Less: accumulated depreciation (136,143 ) (124,721 ) $ 421,764 $ 432,118 Depreciation and amortization expense on property and equipment and right-of-use asset for the three months ended September 30, 2022 and 2021 was $11,422 and $16,008, respectively. |
NOTE 4 -MINERAL RIGHTS
NOTE 4 -MINERAL RIGHTS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 4 -MINERAL RIGHTS | Note 4 – MINERAL RIGHTS The Company has capitalized acquisition costs on mineral properties at September 30, 2022 and June 30, 2022 as follows: September 30, June 30, 2022 2022 Alhambra – Blackhawk project $ 3,115,365 $ 3,115,365 Billali – Jim crow Imperial minerals rights 1,175,000 1,100,000 4,290,365 4,215,365 Less: Accumulated amortization - - Mineral property $ 4,290,365 $ 4,215,365 Exploration Status Overview We have not established that the Alhambra - Blackhawk project or Billali Mine - Jim Crow/Imperial Mine rights projects contain mineral reserves, as defined in Regulation S-K 1300. Acquired mineral rights are considered tangible assets under ASC 930-805. ASC 930-805 requires that mineral rights be recognized at fair value as of the acquisition date. Mining assets include mineral rights. The payments made under the Billali Mine - Jim Crow Mine Agreement are capitalized by the Company and if a revenue stream is attained, of which there can be no assurance, the capitalized balance will be amortized to expense. We are an exploration stage company as our properties have no mineral reserves disclosed as defined in Regulation S-K 1300. A mineral reserve is an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project. Because of costs to attain mineral reserves, it should be noted, we may never exit the exploration stage status. To date, with respect to the Alhambra - Blackhawk project, the Company has not (i) commenced or adopted plans to conduct any exploration, (ii) prepared drilling plans, proposals, timetables or budgets for exploration work, or (iii) identified engineers and other personnel that will conduct or assist in any exploration work. The Company will need to raise funds to conduct additional exploration work and it currently lacks a firm financing commitment for any exploration activities. On December 1, 2020, the Company made a joint announcement with Texas Mineral Resources Corp. (“TMRC”), of the execution of a letter agreement to pursue, negotiate and thereafter enter into a definitive joint venture agreement with TMRC to jointly explore and develop a targeted silver property to be selected by TMRC among patented and unpatented mining claims held by Santa Fe Gold within the Black Hawk Mining District in Grant County, New Mexico. Completion of a joint venture agreement is subject to the successful outcome of a multi-phase exploration plan to be undertaken in the near future by TMRC. Under terms of the letter agreement TMRC plans to conduct a district-wide evaluation among the patented and unpatented claims held by Santa Fe Gold consisting of geologic mapping, sampling, trenching, radiometric surveying, geophysics, drilling and/or other methods as warranted. The purpose of the letter agreement was to allow TMRC the ability to enter onto the Company’s property, begin incurring the costs associated with the work necessary to secure a bankable feasible study. The parties may then secure the funding needed to develop and mine the 80 acres that TMRC identifies. TMRC will be responsible for mining operations and will receive 51% of the profits as defined in the definitive agreement, when executed. The Company will receive 49% of the profits. On July 28, 2022, TMRC issued a press release that updated the successful completion of their geophysical work in the Blackhawk mining district in New Mexico. The related project details that were provided to TMRC by the advanced technology deployed were cost effective and will assist TMRC in developing their next phase in their exploration program on project site. The Company commenced exploration work on the Jim Crow mine in late 2019. Work to date has consisted of beginning the upgrading of the surface facilities, rehabilitating the shaft, expanding the hoisting capability and underground excavation and mining preparation on three levels. Early in the third quarter of 2020 we commenced initial mining operations in the Jim Crow mine. The Company had our mined ore tested at a nearby smelter that it had used prior to our bankruptcy proceedings and the ore was approved for processing at the smelter. In November the smelter ceased taking all outside ore due to a new certification they were attempting to secure. At that time the Company was currently forced to change its current business plan and look for a favorable mill site to process our mined ore. In January 2020 a purchase option was entered into for a future crushing plant site in Duncan, Arizona. The Company had the right to cancel the Agreement at any time. The Company raised the funds purchase the mill property in Duncan, Arizona and the purchase closed on November 9, 2021. With three of our mine employees having contacted the COVID-19 virus in the last week of November 2020, we shut the mining operation down and currently the mines and equipment are under a maintenance protocol. With the current COVID -19 situation and the current inability to process the mined ore we anticipate not restarting the mining operation until late in 2022 or in the first quarter of 2023, depending on the projected completion of our mill operation in Duncan, Arizona. |
NOTE 5 - ASSETS HELD FOR SALE
NOTE 5 - ASSETS HELD FOR SALE | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 5 - ASSETS HELD FOR SALE | NOTE 5 – ASSETS HELD FOR SALE In November 2020 the court awarded various Law’s properties to the Company and in December 2020 the Company was provided good title, free and clear of any encumbrances to them. Law’s residence was levied on pursuant to court order and has been sold by the court and the net proceeds received by the Company in March 2021. The Company does not anticipate receiving an additional substantial reimbursement of the remaining expenses that were incurred as a result of Laws malfeasance after the sale of the remaining property received from the court. Assets held for sale at September 30, 2022 is as follows: 42 acres of unimproved residential property $ 25,800 Property held for sale is valued at the estimated net market value after disposition costs. |
NOTE 6 - ACCRUED LIABILITIES
NOTE 6 - ACCRUED LIABILITIES | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 6 - ACCRUED LIABILITIES | NOTE 6 - ACCRUED LIABILITIES Accrued liabilities consist of the following at September 30, 2022 and June 30, 2022: September 30, June 30, 2022 2022 Franchise taxes $ 3,920 $ 3,920 Audit fees 22,750 40,000 Merger costs, net 269,986 269,986 Payroll burden 452,212 414,404 Vacation pay 36,014 36,014 Accrued director fees 750,000 675,000 Other 165,500 144,500 Interest 5,720,475 5,545,439 Commodity Supply Agreement finance fees – See NOTE 10 4,717,077 5,255,827 $ 12,137,934 $ 12,385,090 |
NOTE 7 - NOTES PAYABLE - CURREN
NOTE 7 - NOTES PAYABLE - CURRENT MATURITIES | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 7 - NOTES PAYABLE - CURRENT MATURITIES | NOTE 7 - NOTES PAYABLE – CURRENT MATURITIES Installment Sales Note On June 1, 2012, the Company entered into an installment sales contract for $593,657 to purchase certain equipment. The term of the agreement is for 48 months at an interest rate of 5.75%, secured by the equipment. The balance owed on the installment sales contract was $398,793 at September 30, 2022 and June 30, 2022, respectively, had accrued interest of $185,172 and $179,409, respectively and interest expense of $5,763, respectively for each of the three months ended September 30, 2022 and 2021. The Company has been unable to make its monthly payments since November 2013 and has been in default since that time. The installment sales contract is due and in default at September 30, 2022 and June 30, 2022. The equipment has been returned to the vendor for sale, and the equipment remains unsold. Tyhee Merger Agreement In conjunction with the Merger Agreement, Tyhee Gold Corp. (“Tyhee”) and the Company entered into a Bridge Loan Agreement (“Bridge Loan”), pursuant to which Tyhee was obligated to advance up to $3 million to the Company in accordance with the terms thereof. Tyhee advanced the Company $1,745,092 under the Bridge Loan as of June 30, 2014. The Bridge Loan bears an annual interest rate of 24%. At that time the Company and Tyhee were in disagreement as to the due date of the Bridge Loan. Tyhee has provided the Company with purported notice of default under the Bridge Loan Agreement. The Company has numerous claims against Tyhee resulting from the Merger Agreement, Tyhee’s failure to fund the total $3 million under the Bridge Loan and Tyhee’s allocation of the proceeds from the Bridge Loan. The Company recorded merger expenses that are due to Tyhee of $269,986 and is included in accrued liabilities at September 30, 2022 and June 30, 2022. This amount is net of a break fee of $300,000 due to the Company from Tyhee. Accrued interest on note at September 30, 2022 and June 30, 2022 is $3,518,515 and $3,412,949, respectively, and was in default. In December 2016, the court-administered trust paid $91,788 to Tyhee and this amount was applied against the accrued interest on the Bridge Loan. The trust payment was recorded as a gain on trust debt forgiveness. Interest expense for the three months ended September 30, 2022 and 2021 was $105,566, respectively. Tyhee Gold Corp. is no longer in existence and the Company is in process of having a litigation firm in British Columbia to have the debt judicially extinguished under British Columbia law, where the agreement is governed, and in accordance FASB ASC 405-20-40-1(b) which states that “a liability has been extinguished if the debtor is legally released from being the primary obligor under the liability, either judicially or by the creditor.” Notes Payable An individual during our fiscal year 2019 loaned the Company $239,750 of which the Company paid back $130,000 through our fiscal year ended June 30, 2021, and in our fiscal year ended June 30, 2021 and received an additional $18,000 loaned to the Company in that current fiscal year. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender. Accrued interest on the loan at September 30, 2022 and June 30, 2022 is $30,600 and $29,091, respectively. During the period ended September 30, 2021, the Company made a $10,000 principal payment on the note and reversed the $18,000 unauthorized payment of costs on behalf of the Company. Balance of the loan at September 30, 2022 and June 30, 2022 was $99,750, respectively. Interest expense on the loan for the three months ended September 30, 2022 and 2021 is $1,509 and $1,781, respectively. A shareholder in April 2022, loaned the Company $100,000 at an annual interest rate of 12% and the note has a six-month maturity. The proceeds were used for working capital requirements. In conjunction with the loan, the Company granted 2,000,000 six-month vested stock options with a strike price of $0.05 per share. Accrued interest on the loan at September 30, 2022 and June 30, 2022 was $5,195 and $2,170, respectively. Interest expense on the loan for the three months ended September 30, 2022 was $3,025. The following summarizes notes payable: September 30, June 30, 2022 2022 Installment sales note in 48 monthly installments of $13,874, including interest through July 16, 2016 $ 398,793 $ 398,793 Unsecured bridge loan notes payable, interest at 2% monthly, payable August 17, 2014, six months after the first advance on the bridge loan 1,745,092 1,745,092 Current portion of Paycheck Protection Program Loans 9,036 - Note payable, interest at 6% 99,750 99,750 Note payable, 12% 100,000 100,000 $ 2,352,671 $ 2,343,635 |
NOTE 9 - COMPLETION GUARANTEE P
NOTE 9 - COMPLETION GUARANTEE PAYABLE | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 9 - COMPLETION GUARANTEE PAYABLE | NOTE 8 – COMPLETION GUARANTEE PAYABLE At June 30, 2012, the Company calculated the completion guarantee payable provided by Amendment 1 under the Gold Stream Agreement with Sandstorm. Based upon the provisions of the Agreement and the related completion guarantee test, incremental financing charges totaling $504,049 were recognized in Other Expenses and accrued at June 30, 2012. These accrued charges, combined with the remaining unaccredited liability totaled $3,359,873 at September 30, 2022 and at June 30, 2022. Interest of $44,098 was expensed during the three months ended September 30, 2022 and 2021, respectively. Accrued interest at September 30, 2022 and June 30, 2022 was $1,808,027 and $1,763,929, respectively. |
NOTE 9 - NON-CURRENT NOTES PAYA
NOTE 9 - NON-CURRENT NOTES PAYABLE | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 9 - NON-CURRENT NOTES PAYABLE | NOTE 9 – NON-CURRENT NOTES PAYABLE Notes Payable During the quarter ended December 31, 2021, a shareholder made two secured loans of $200,000 each, with an annual interest rate of 10% and, note maturity dates of two years from the date of the notes. Interest is due and payable on the annual anniversary dates and the principal is due on the maturity date of the notes. The note holder loans are secured by the Duncan, Arizona mill property. Accrued interest on the notes at September 30, 2022 and June 30, 2022 is $36,657 and $26,575, respectively. Interest expense on these notes for the three months ended September 30, 2022 is $10,082. In conjunction with each note issuance, the Company granted 4,000,000 two-year vested stock options with a strike price of $0.05 per share. Paycheck Protection Program Loans During the quarter ending June 30, 2020, the Company entered into a Promissory Notes (the “PPP Notes”) with Bank of Oklahoma as the lender (the “Lender”), pursuant to which the Lender agreed to make the loans to the Company under the Paycheck Protection Program (the "PPP Loan") offered by the U.S. Small Business Administration (the “SBA”) in a principal amount of $224,700 pursuant to Title 1 of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”). The PPP Loan proceeds are available to be used to pay for payroll costs, including salaries, other similar compensation, group health care benefits, and paid leaves; rent; utilities; and interest on certain other outstanding debt. The amount that will be forgiven will be calculated in part with reference to the Company’s full time headcount during the twenty-four week covered period, as adjusted for current regulation updates, following the funding of the PPP Loan. During our fiscal year 2021 we received two loans in the second round of the PPP loan program in the principal amount of $109,520. The PPP Loan proceeds are available to be used to pay for payroll costs, including salaries, and similar compensation, group health care benefits, and paid leaves; rent; utilities; and interest on certain other outstanding debt. Any amount that will be forgiven will be calculated in part with reference to the Company’s fulltime headcount during the twenty-four-week covered period. Under the new regulations for the second draw, at least 60% of the proceeds must be spent on payroll costs. The interest rate on the PPP Note is a fixed rate of 1% per annum. To the extent that the amounts owed under the PPP Loans, or a portion of them, are not forgiven, the Company will be required to make principal and interest payments. Currently, the deferral period for payments of principal and interest is 10 months from the end of the covered period. A loan forgiveness application must be submitted to the lender within the 10 months after the 24-week covered period. The Company will not have to begin principal and interest payments before the date on which the SBA remits the loan forgiveness amount to the lender. Under current regulations, any monthly installments would begin approximately seventeen months from March 20, 2021. The PPP Notes have a maturity dates of five years from their effective note date. The PPP Note includes events of default. Upon the occurrence of an event of default, the Lender will have the right to exercise remedies against the Company, including the right to require immediate payment of all amounts due under the PPP Note. The following summarizes non-current debt at September 30, 2022 and June 30, 2022: September 30, June 30, 2022 2022 Notes payable $ 400,000 $ 400,000 Loans payable to bank under the Paycheck Protection Program 100,484 109,520 Accrued interest on Paycheck Protection Program Loans 1,392 1,266 $ 501,876 $ 510,786 |
NOTE 10 - CONTINGENCIES AND COM
NOTE 10 - CONTINGENCIES AND COMMITMENTS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 10 - CONTINGENCIES AND COMMITMENTS | NOTE 10 - CONTINGENCIES AND COMMITMENTS Commodity Supply Agreement In December 2009, the Company entered into a definitive gold stream agreement (the “Gold Stream Agreement”) with Sandstorm to deliver a portion of the life-of-mine gold production (excluding all silver production) from the Company’s Summit silver-gold mine. Under the agreement, the Company received advances of $4,000,000 as an upfront deposit, plus continues to receive future ongoing payments equal to the lesser of: $400 per ounce or the prevailing market price, (the “Fixed Price”) for each ounce of gold delivered pursuant to the Gold Stream Agreement for the life of the mine. The Company purchases and delivers refined gold in order to satisfy the requirements of the Gold Stream Agreement and receives the Fixed Price per ounce in cash from Sandstorm. The difference between the prevailing market price and the Fixed Price per ounce for gold delivered is credited against the upfront deposit of $4,000,000 until the obligation is reduced to zero. Future ongoing payments for gold deliveries will continue at the Fixed Price per ounce with no additional credits or advances to be received from Sandstorm. In certain circumstances, including failure to meet minimum production rates, interruption in production due to permitting issues and customary events of default, the agreement may be terminated. In such event, the Company may be required to return to Sandstorm any remaining unaccredited balance of the original $4,000,000 upfront deposit. See NOTE 8 - COMPLETION GUARANTEE PAYABLE. Gold production subject to the agreement includes 50% of the first 10,000 ounces of gold produced, and 22% of the gold thereafter. The net cost of delivering refined gold along with other related transactional costs corresponding to the Gold Stream Agreement are recorded in Other Expenses as financing costs - commodity supply agreements. Under the Gold Stream Agreement, the Company has a recorded obligation at September 30, 2022 and at June 30,2022 of 3,709 ounces of undelivered gold valued at approximately $4,717,077 and $5,255,827 respectively, presented in accrued liabilities on the balance sheet, net of the Fixed Price of $400 per ounce. The Summit silver-gold mine property referred to in this Gold Stream Agreement was sold in the 363 Asset Sale as of asset transfer on February 26, 2016. Mineral Property Rights The Company determined the agreement on the Billali and Jim Crow/Imperial mines is a Right Of Use (“ROU”) asset lease and is cancellable at any time by the Company. There are no interest charges provided for in the Agreement. Costs of exploration, mine development, and carrying and retaining unproven mineral lease properties are expensed as incurred. The Company expenses all mineral exploration and development costs as incurred as we are in the exploration stage. If the Company identifies mineral reserves under Regulation S-K 1300, in its investigation of its properties and in the opinion of the qualified person, can be the basis of an economically viable project, we would enter the development stage and capitalize future costs until production is established. The Company will capitalize the payments under the Agreement as made. At the time the Company has a revenue stream from this project, the Company will amortize the capitalized payment balance each quarter. Companies that have mineral reserves under Regulation S-K 1300 typically capitalize these costs, and subsequently depreciate or amortize them on a units-of-production basis as reserves are mined. Unlike these other companies, on our properties that have no reserves we will depreciate or amortize any capitalized costs based on the most appropriate amortization method, which includes straight-line or units-of-production method over the estimated life of the mine, as determined by our geologist. As we have no reliable information to compute a units of production methodology, we will amortize our capitalized costs on a straight-line basis over the estimated remaining mine life. Based upon the terms of the ROU agreement, the Company does not have ownership of the properties and the ROU agreement provides for ownership transfer upon completion of all payments. The Company has the right to terminate the agreement at any time by written notice to the seller. Upon such termination by the Company, all right, title and interest of the Company under the ROU agreement will terminate with respect to the mines and water lease. The Company would be relieved of all further obligations as set forth in the ROU agreement except for any obligations which accrued prior to such termination. Upon such termination, the Company may not make any claims as to the right to reimbursement, set-off, other payment or other return of value paid by the Company for any improvements and any capitalized cost that has not been amortized on the Company’s books, would be written off to expense. As of September 30, 2022, the Company has not established mineral reserves on any of our exploration projects; therefore, all exploration costs are being expensed. During the three months ended September 30, 2022, we capitalized payments of $75,000 under the Agreement. It should also be noted, that the Company may never exit the exploration stage company status due to the costs of determining mineral reserves under regulation S-K 1300. Payments under Amendment Five of the Agreement on the Billali and Jim Crow/Imperial mines are estimated as follows: Fiscal years ending June 30: Prior year payments to 6/30/2022 $ 1,100,000 2023 300,000 2024 900,000 2025 2,100,000 2026 2,100,000 2027 2,100,000 2028 1,400,000 Total lease payments $ 10,000,000 Office and Real Property Leases The Company’s office consists of a single room located in Albuquerque, NM, at the home of the former CFO for a monthly rent of $550. The Company rented a new office space in July 2021 with a current rental cost per month $175 as the official Company address. Rental expense for the three months ended September 30, 2022 and 2021 was $1,975 and $1,863, respectively. Title to Mineral Properties Although the Company has taken steps, consistent with industry standards, to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects. |
NOTE 11- STOCKHOLDERS' DEFICIT
NOTE 11- STOCKHOLDERS' DEFICIT | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 11- STOCKHOLDERS' DEFICIT | NOTE 11 - STOCKHOLDERS’ DEFICIT The Company’s Common Stock was Deregistered and Trading was Halted In July of 2020, the Company received notice from the SEC that it was seeking to deregister the Company’s common stock pursuant to Section 12(j), based on the Company’s failure to file periodic reports with the Commission and otherwise provide current information to the market. This failure was based in large part from the need to restate its financial statements and the need to find and engage a PCAOB auditor who was willing to conduct and provide the required audits amid the SEC and DOJ’s investigations. Although we were able to secure a qualified auditor, we were not able to make our filings quickly enough and by the time they were completed, the Commission had already sent a notice under Section 12(k). The Commission takes a hardline position in these situations such that once they have instituted deregistration proceedings, the only options available to the Company were to litigate or settle and consent to the deregistration of the Company’s common stock. Historically, registrants have not been successful in litigating with the Commission over Section 12(j) matters and therefore the Company determined that the best course of action was to consent to deregistration of its common stock and then file a new registration statement on Form 10-12G. On December 17, 2020, the SEC order suspending trading went into effect. At this time, the Company has signed a settlement agreement with the SEC with respect to the registration of its common stock in response to the Commission’s institution of deregistration proceedings under Section 12(j), it is re-registering the same under Section 12(g) by way of filing a Form 10-12G. The Company filed our Form 10-12G Registration Statement with the SEC and on August 4, 2022 the SEC declared the Form 10-12G Registration Statement effective. The Company submitted the application to the Over-The-Counter Markets Group (the “OTC”) to trade on OTC-QB tier. Upon going through the initial OTC approval process, they requested the Company submit our Form 211 to the Financial Industry Regulatory Authority (“FINRA”) for their review and approval. Upon receiving approval by FINRA we will then resubmit our application to the OTC for their approval and trade on one of their platforms. The Company’s complete and current effective Form 10-12G meets the information requirements required by Form 15c2-11. Until we have provided any required addition requested information and documentation required to FINRA and their approval of our Form 211 filing and the subsequent approval or our filing with the OTC, there will not be a publicly quoted market for our stock. One of the consequences of having our common stock deregistered and submitting our forms with FINRA is that we are required to have a market maker sponsor and submit an updated/new Form 15c-211 as will be requested by FINRA. We are currently seeking to select a market maker to sponsor our Form 15c-211 filing with FINRA. Until FINRA has accepted our filing and we have provided all of the information and documentation required, there will not be a publicly quoted market for our stock. There can be no assurances that the market maker we select will agree to sponsor us or if they are not, that we will be successful in finding a market maker that is willing to sponsor us with FINRA or that we will be able to satisfy FINRA’s information and documentation requirements in a timely manner or at all. Any delay or failure in securing sponsorship from a market maker or in satisfying FINRA’s requirements would result in our shareholders not having a public market to sell their shares. Further, it would make it more difficult for the Company to obtain the financing it requires. Common Stock Transactions For the three months ended September 30, 2022, the Company: (i) Accepted a subscription for an aggregate of 2,000,000 shares of restricted common stock from an accredited investor for cash proceeds of $100,000 . Warrants During the three months ended September 30, 2022, the Company issued 1,000,000 three-year warrants at a strike price of $0.05 as part of the private placement to an accredited investor. The Black-Sholes fair value of the issued warrants for the three months ended September 30, 2022 is $37,699. During the three months ended September 30, 2022, 1,541,667 expired. Options During the three months ended September 30, 2022 no options were granted. The Black-Scholes option-pricing model was used to estimate the fair value of the options and warrants with the following weighted-average assumptions for the periods ending September 30, 2022 and 2021 were as follows: September 30, 2022 September 30, 2021 Risk-free interest rate 4.12 % 0.35% - 0.43 % Expected volatility 129.59 % 114.45 – 119.78 % Expected life (years) 3 3 Expected dividend yield 0 % 0 % Stock option and warrant activity for the three months ended September 30, 2022 are as follows: Stock Options Stock Warrants Weighted Weighted Average Average Number of Exercise Number of Exercise Shares Price Shares Price Outstanding at June 30, 2022 40,000,000 $ 0.05 16,010,483 $ 0.056 Granted — — 1,000,000 0.05 Canceled — — — — Expired — — (1,541,667 ) (0.067 ) Exercised — — — — Outstanding at September 30, 2022 40,000,000 $ 0.05 15,468,816 $0.055 Stock options and warrants outstanding and exercisable at September 30, 2022, are as follows: Outstanding and Exercisable Options Outstanding and Exercisable Warrants Weighted Weighted Average Average Contractual Contractual Weighted Exercise Remaining Exercise Remaining Average Price Outstanding Exercisable Life Price Outstanding Exercisable Life Excise Range Number Number (in Years) Range Number Number (in Years) Price $0.05 40,000,000 40,000,000 1.32 $0.05 10,877,149 10,877,149 1.23 - - $0.06 3,416,667 3,416,667 0.41 - - $0.07 975,000 975,000 0.74 — - $0.15 200,000 200,000 1.55 40,000,000 40,000,000 15,468,816 15,468,816 Outstanding Options 1.32 Outstanding Warrants 1.02 $0.055 Exercisable Options 1.32 Exercisable Warrants 1.02 $0.055 As of September 30, 2022, the aggregate intrinsic value of all stock options and warrants vested and expected to vest was $498,596 and the aggregate intrinsic value of currently exercisable stock options and warrants was $498,596. The intrinsic value of each option or warrant share is the difference between the fair market value of the common stock and the exercise price of such option or warrant share to the extent it is "in-the-money". Aggregate intrinsic value represents the value that would have been received by the holders of in-the-money options had they exercised their options on the last trading day of the quarter and sold the underlying shares at the closing stock price on such day. The intrinsic value calculation is based on the $0.0598 closing stock price of the common stock on December 17, 2020 when the stock was delisted. The total number of in-the-money options and warrants vested and exercisable as of September 30, 2022 was 55,468,816. The total intrinsic value associated with options exercised during the three months ended September 30, 2022 was $0. Intrinsic value of exercised shares is the total value of such shares on the date of exercise less the cash received from the option or warrant holder to exercise the options. The total grant-date fair value of option and warrant shares vested during the three months ended September 30, 2022 was $37,699. |
NOTE 12 - INCOME TAXES
NOTE 12 - INCOME TAXES | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 12 - INCOME TAXES | NOTE 12 - INCOME TAXES The Company has had no income tax expense or benefit since July 1, 1997, because of operating losses. Deferred tax assets and liabilities are determined based on the estimated future tax effect of differences between the financial statement and tax reporting basis of assets and liabilities, as well as for net operating loss carry forwards, given the provisions of existing tax laws. The Company files income tax returns in the U.S. and state jurisdictions and there are open statutes of limitations for taxing authorities to audit the Company’s tax returns from fiscal year ended June 30, 2022. The approximate income tax benefit is computed by applying the current revised U.S. federal income tax rate of 21% to net income (loss) before taxes for the fiscal years ended on and after June 30, 2019 and for prior tax years at the revised tax rate of 21%. New Mexico revised their tax rate to 6.2 % for 2017 and 5.9 % in 2019. The approximate income tax benefit is computed by applying the current revised New Mexico tax rate of 5.9% to net income (loss) before taxes for the fiscal year ended June 30, 2021, and the 5.9% rate to the prior four-year periods of net income or (loss). In assessing the realizability of estimated deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. Due to the Company’s history of losses, the deferred tax assets are fully offset by a valuation allowance as of September 30, 2022 and June 30, 2022. |
NOTE 13 - RELATED PARTY TRANSAC
NOTE 13 - RELATED PARTY TRANSACTIONS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 13 - RELATED PARTY TRANSACTIONS | NOTE 13 – RELATED PARTY TRANSACTIONS Since August 2015, the Company has leased a home work space from Mr. Mueller for $550 a month for the corporate administrative functions in Albuquerque, NM. In mid-July 2021, the Company rented a small office space at 2325 San Pedro NE, Albuquerque, NM for $125 a month and currently at $175 per month as the Company address. Rental expense was $2,175 and $1,963 for three months ended September 30, 2022 and 2021, respectively. Since July 2019, Nataliia Mueller, wife of Mr. Mueller, has been paid an annual wage of $60,000. Currently she is the assistant to the current CFO, and functions in the areas of purchasing, payroll and accounts payable. Misappropriated Funds and Entry into a Material Definitive Agreement A former director and former chief executive officer of the Company, Mr. Thomas H. Laws, entered into a secured promissory note and security agreement in the principal amount of $930,000 in favor of the Company on September 19, 2018, bearing interest at the annual rate of 4% and maturing September 30, 2018 (“Secured Promissory Note”). The Company requested the former chief executive to execute the Secured Promissory Note and security agreement as a result of the matters discussed below, prior to the completion of the special committee investigation. The security interests include certain real estate and a Cessna model 182G airplane. The Secured Promissory Note also contains late fee and default provisions under the deeds of trust, Security Agreement and other agreements. Subsequent professional costs including legal, auditing, forensic accounting and related filing costs related to this event have been added to the amounts owed by Mr. Laws. At the time of filing this report, we have determined costs associated with Mr. Laws action currently aggregates approximately $1,651,263. We have collected $990,632 in cash and properties held for sale with an estimated net market value of $25,800 as of the date of filing of this Form 10-Q. As of the filing of this report, Mr. Laws has plead guilty to various charges brought against him by the U. S. District Attorney for the District of New Mexico, which include the Company’s allegations. Mr. Laws currently has been sentenced on the charges which he plead, to 81 months in prison. Currently he is serving that sentence. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court. In November 2020 the court awarded various Law’s properties to the Company and in December 2020 the Company was provided good title, free and clear of any encumbrances to them. Law’s residence was levied on pursuant to court order and has been sold by the court and the net proceeds received by the Company in March 2021. The Company does not anticipate receiving an additional substantial reimbursement of the remaining expenses that were incurred as a result of Laws malfeasance after the sale of the remaining property received from the court. Transactions involving related parties cannot be presumed to be carried out on an arm's-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated. |
NOTE 15 - LEGAL PROCEEDINGS
NOTE 15 - LEGAL PROCEEDINGS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 15 - LEGAL PROCEEDINGS | NOTE 14 – LEGAL PROCEEDINGS All legal proceedings were stayed with the filing of Chapter 11 bankruptcy. Boart Longyear Company v. Lordsburg Mining Company Boart Longyear Company v. Lordsburg Mining Company Boart Longyear Company v. Lordsburg Mining Company Wagner Equipment Co. v. Lordsburg Mining Company With the completion of the bankruptcy in June 2016, all pending legal actions were reinstated and debts at the time of the bankruptcy are currently due and in default, but none of the then existing litigation has to date resulted in subsequent legal proceedings. There can be no assurance that subsequent legal proceedings will not materialize. After the dismissal of the bankruptcy case, the Company had limited assets, but remained liable for all commitments and debts that then were outstanding. Santa Fe Gold Barbados, The Lordsburg Mining Company and AZCO are subsidiaries of the Company with nominal assets and all of their commitments, debts and legal proceedings remain. The bankruptcy court set up a trust fund funded by the activities of the Summit mine (main asset sold in bankruptcy proceedings) for five years from reopening of the mine and the trust funds will be distributed by an independent trustee to certain unsecured creditors of record. As disclosed in the Company’s Form 8-K filed on October 1, 2018, a director and former chief executive officer of the Company, Mr. Thomas H. Laws, entered into a secured promissory note and security agreement in the principal amount of $930,000 in favor of the Company on September 19, 2018, bearing interest at the annual rate of 4% and maturing on September 30, 2018 (“Secured Promissory Note”). The Company requested the former chief executive to execute the Secured Promissory Note and security agreement as a result of the matters discussed below prior to the completion of the special committee investigation. The security interests included certain real estate and a Cessna model 182G airplane. The Secured Promissory Note also contains late fee and default provisions under the deeds of trust, Security Agreement and other agreements. Subsequent professional costs including legal, auditing, forensic accounting and related filing costs related to this event have been added to the amounts owed by Mr. Laws. As of the filing of this report, we have determined that the costs associated with Mr. Laws action currently aggregate to approximately $1,651,263 including legal charges and forensic accounting, of which we have collected $990,632 in cash and properties with an estimated net market value of $25,800 as of the date of filing of this Form 10-Q. As of the filing of this report, Mr. Laws has plead guilty to various charges brought against him by the U. S. District Attorney for the District of New Mexico, which include the Company’s allegations. Mr. Laws is currently has been sentenced on the charges which he plead, to 81 months in prison. Currently he is serving that sentence. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court. In November 2020 the court awarded various Law’s properties to the Company and in December 2020 the Company was provided good title, free and clear of any encumbrances to them. Law’s residence was levied on pursuant to court order and has been sold by the court and the net proceeds received by the Company in March 2021. The Company does not anticipate receiving an additional substantial reimbursement of the remaining expenses that were incurred as a result of Laws malfeasance after the sale of the remaining property received from the court. We are subject from time to time to litigation, claims and suits arising in the ordinary course of business. Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of its financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company discloses the nature of the loss contingencies, together with an estimate of the range of possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain unresolved proceedings are not presently determinable, and an estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be reasonably made, an adverse outcome from such proceedings could have a material adverse effect on its financial statements in any given reporting period. However, in the opinion of Management, after consulting with legal counsel, the ultimate liability related to the current outstanding litigation is not expected to have a material adverse effect on its financial statements. |
NOTE 15 - SUBSEQUENT EVENTS
NOTE 15 - SUBSEQUENT EVENTS | 3 Months Ended |
Sep. 30, 2022 | |
Notes | |
NOTE 15 - SUBSEQUENT EVENTS | NOTE 15 – SUBSEQUENT EVENTS Acquisition of Processing Mill The Company is currently in process of acquiring a mill operation for its head ore to located on its property in Duncan, Arizona. The seller of the mill has disassembled the mill in Kellogg, Idaho and relocated the mill to the Duncan, Arizona site. Currently all associated costs of the mill and its relocation are being accumulated and finalized by the seller. At this time there are no agreements between the seller and the Company as to terms and sales price of the delivered disassembled mill and such price is anticipated to be negotiated and determined when funding is obtained by the Company to acquire and reconstruct the mill. |
NOTE 2 - SUMMARY OF SIGNIFICA_2
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Principles of Consolidation (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries AZCO Mica, Inc., a Delaware corporation, The Lordsburg Mining Company, a New Mexico corporation, Santa Fe Gold Barbados Corporation, a Barbados corporation, Santa Fe Acquisitions Company, a New Mexico Limited Liability Company, Minerals Acquisitions, LLC, a New Mexico Limited Liability Company and Bullard’s Peak Corporation, a New Mexico corporation. All significant inter-company accounts and transactions have been eliminated in consolidation. |
NOTE 2 - SUMMARY OF SIGNIFICA_3
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Estimates (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Estimates | Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates under different assumptions or conditions. Significant estimates are used when accounting for the Company’s carrying value of mineral properties, useful life of fixed assets, depreciation and amortization, accruals, derivative instrument liabilities, taxes and contingencies, asset retirement obligations, revenue recognition, and stock-based compensation which are discussed in the respective notes to the consolidated financial statements. |
NOTE 2 - SUMMARY OF SIGNIFICA_4
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Fair Value of Financial Instruments (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”) and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. A slight change in unobservable inputs such as volatility can significantly have a significant impact on the fair value measurement of the derivatives liabilities. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company’s financial assets and liabilities, such as cash and accounts payable approximate their fair values because of the short maturity of these instruments. |
NOTE 2 - SUMMARY OF SIGNIFICA_5
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Cash and Cash Equivalents (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all liquid investments purchased with an initial maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash balances. |
NOTE 2 - SUMMARY OF SIGNIFICA_6
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Property and Equipment (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Property and Equipment | Property and Equipment Property is carried at cost. The cost of repairs and maintenance are expensed as incurred and major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income in the year of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows. Vehicles 5 years Mine equipment 7 years General equipment 3-7 years Small tools 1.25 years |
NOTE 2 - SUMMARY OF SIGNIFICA_7
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Mine Development (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Mine Development | Mine Development Mine development costs include engineering and metallurgical studies, drilling, and other related costs to delineate an ore body, and the building of access ways, shafts, lateral access, drifts, ramps and other infrastructure in an underground mine. Costs incurred before mineralization is classified as proven and probable reserves are expensed and classified as exploration expense. Capitalization of mine development project costs, that meet the definition of an asset, begins once mineralization is classified as proven and probable reserves. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information on the ore body or converting non-reserve mineralization to proven and probable reserves. All other drilling and related costs are expensed as incurred. Drilling costs incurred during the production phase for operational ore control are allocated to inventory costs and then included as a component of costs applicable to sales. Mine development is amortized using the units-of-production method based upon estimated recoverable ounces in proven and probable reserves. To the extent that these costs benefit an entire ore body, they are amortized over the estimated life of the ore body. Costs incurred to access specific ore blocks or areas that only provide benefit over the life of that area are amortized over the estimated life of that specific ore body. Currently, with no claims or mines in our possession that have proven and probable reserves, we have no development costs incurred. As of September 30, 2022, the Company has not established proven or probable reserves or established the commercial feasibility of any of our exploration projects in the opinion of a qualified person as defined in Regulation S-K 1300 and all mine development costs are expensed as incurred. |
NOTE 2 - SUMMARY OF SIGNIFICA_8
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Mineral Rights (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Mineral Rights | Mineral Rights Mineral properties are capitalized at their fair value at the acquisition date, either as an individual asset purchase or as part of a business combination. When it is determined that a mineral property can be economically developed as a result of establishing reserves, subsequent mine development is capitalized and are amortized using the units of production method over the estimated life of the ore body based on estimated recoverable tonnage in proven and probable reserves. The Company’s mineral rights generally are enforceable regardless of whether proven and probable reserves have been established. The Company has the ability and intent to renew mineral interests where the existing term is not sufficient to recover all identified and valued proven and probable reserves and/or undeveloped mineralized material. Costs of exploration, carrying and retaining unproven mineral lease properties are expensed as incurred. The Company expenses all mineral exploration costs as incurred as it is still in the exploration stage. If the Company identifies proven and probable reserves in its investigation of its properties and upon development of a plan for operating a mine, it would enter the development stage and capitalize future costs until production is established. When a property reaches the production stage, the related capitalized costs are amortized on a units-of-production basis over the proven and probable reserves following the commencement of production. The Company assesses the carrying costs of the capitalized mineral properties for impairment under ASC 360-10, “Impairment of long-lived assets”, and evaluates the carrying value under ASC 930-360, “Extractive Activities - Mining”, annually. An impairment is recognized when the sum of the expected undiscounted future cash flows is less than the carrying amount of the mineral properties. Impairment losses, if any, are measured as the excess of the carrying amount of the mineral properties over its estimated fair value. To date, the Company has not established the economically viability of any of our exploration prospects as defined under Regulation S-K, therefore, all exploration costs are expensed as incurred. |
NOTE 2 - SUMMARY OF SIGNIFICA_9
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Impairment of Long-Lived Assets (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. The Company did not recognize any impairment during the three months ended September 30, 2022 and 2021. |
NOTE 2 - SUMMARY OF SIGNIFIC_10
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Reclamation and Asset Retirement Costs (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Reclamation and Asset Retirement Costs | Reclamation and Asset Retirement Obligation Reclamation obligations (“ARO”) are recognized when incurred and recorded as liabilities at fair value. The liability is accreted over time through periodic charges to accretion expense. The asset retirement cost is capitalized as part of the asset’s carrying value and depreciated over the life of the related asset. Reclamation costs are periodically adjusted to reflect changes in the estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs. The reclamation obligation is based on when spending for an existing disturbance will occur. The Company reviews, on an annual basis, unless otherwise deemed necessary, the reclamation obligation at each mine site in accordance with ASC guidance for reclamation obligations. No reclamation costs were required for the three months ended September 30, 2022 and 2021. |
NOTE 2 - SUMMARY OF SIGNIFIC_11
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Derivative Financial Instruments (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Derivative Financial Instruments | Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. From time to time, the Company reviews the terms of convertible debt, equity instruments and other financing arrangements to determine whether there are embedded derivative instruments, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Also, in connection with the issuance of financing instruments, the Company may issue freestanding options or warrants that may, depending on their terms, be accounted for as derivative instrument liabilities, rather than as equity. The Company may also issue options or warrants to non-employees in connection with consulting or other services. Derivative financial instruments are initially measured at their fair value. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. To the extent that the initial fair values of the freestanding and/or bifurcated derivative instrument liabilities exceed the total proceeds received, an immediate charge to income is recognized as a one-day derivative loss, in order to initially record the derivative instrument liabilities at their fair value. The discount from the face value of convertible debt or equity instruments resulting from allocating some or all of the proceeds to the derivative instruments, together with the stated interest on the instrument, is amortized over the life of the instrument through periodic charges to income, using the effective interest method. When required to arrive at the fair value of derivatives associated with the convertible notes and warrants, a Black Scholes or Monte Carlo model are utilized that values the Convertible Note and Warrant based on average discounted cash flow factoring in the various potential outcomes by a Chartered Financial Analyst (‘CFA”). In determining the fair value of the financial derivatives, the CFA assumes that the Company’s business would be conducted as a going concern. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed at the end of each reporting period. If reclassification is required, the fair value of the derivative instrument, as of the determination date, is reclassified. Any previous charges or credits to income for changes in the fair value of the derivative instrument are not reversed. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date. |
NOTE 2 - SUMMARY OF SIGNIFIC_12
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Leases (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Leases | Leases In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with a term of more than one year. Accounting by lessors will remain similar to existing U.S. GAAP. Subsequent accounting standards updates have been issued, which amend and/or clarify the application of ASU 2016-02. For the purposes of recognizing ROU assets and lease liabilities associated with the Company’s leases, the Company has elected the practical expedient to not recognize a ROU asset or lease liability for short-term leases, which are leases with a term of twelve months or less. The lease term is defined as the noncancelable portion of the lease term plus any periods covered by an option to extend the lease if it is reasonably certain that the option will be exercised. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company adopted Topic 842 as of July 1, 2019 and at this time the standard will not have a significant impact on our consolidated financial statements until a significant lease agreement is entered. |
NOTE 2 - SUMMARY OF SIGNIFIC_13
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Warrants and Options (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Warrants and Options | Warrants In connection with certain financing, the Company has issued warrants to purchase shares of its common stock. The outstanding warrants are standalone instruments that are not puttable or mandatorily redeemable by the holder and are classified as equity awards. The Company measures the fair value of the awards using the Black-Scholes option pricing model as of the measurement date. Warrants are recorded at fair value as expense over the requisite service period or at the date of issuance, if there is not a service period. The Company assessed the classification of its common stock purchase warrants as of the date of each equity offering and determines that such instruments meet the criteria for equity classification, as the settlement terms indicate that the instruments are indexed to the entity’s underlying stock. Warrant and option expense for the three months ended September 30, 2022 and 2021 was $37,699 and $90,633, respectively. |
NOTE 2 - SUMMARY OF SIGNIFIC_14
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Income Taxes (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Income Taxes | Income Taxes The Company accounts for income taxes using the asset and liability approach, which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of such assets and liabilities. This method utilizes enacted statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. A valuation allowance is recorded when it is more likely than not that deferred tax assets will be unrealizable in future periods. As of September 30, 2022 and June 30, 2022, the Company has recorded a valuation allowance against the full amount of its net deferred tax assets. The inability to foresee taxable income in future years makes it more likely than not that the Company will not realize its recorded deferred tax assets in future periods. |
NOTE 2 - SUMMARY OF SIGNIFIC_15
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Net Earnings (Loss) Per Share (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Net Earnings (Loss) Per Share | Net Earnings (Loss) Per Share Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive for the three months ended September 30, 2021. For three months ended September 30, 2022 the calculations of basic and diluted loss per share are presented below. The potentially dilutive securities consisted of the following for the period ended September 30, 2022: September 30, 2022 Options to purchase common stock 40,000,000 Warrants to purchase common stock 15,468,816 A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation for the three months ended September 30, 2022 is as follows: Net Income (Numerator) Weighted Average Common Shares (Denominator) Per Share Amount For the three months ended September 30, 2022: Basic EPS Income available to common stockholders $ 60,598 441,504,203 $ 0.00 Diluted EPS Dilutive shares from options and warrants — 54,566,642 0.00 Income available to common stockholders plus assumed conversions $ 60,598 496,070,845 $ 0.00 |
NOTE 2 - SUMMARY OF SIGNIFIC_16
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Stock-Based Compensation (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Stock-Based Compensation | Stock-Based Compensation In connection with terms of employment with the Company’s executives and employees, the Company occasionally issues options to acquire its common stock. Awards are made at the discretion of the Board of Directors. Such options may be exercisable at varying exercise prices and generally vested upon date of grant or may vest over a period of six months to a year. The Company accounts for option-based compensation on the grant date fair value of the award. The Company estimates the fair value of the award using the Black-Scholes option pricing model for valuation of the share-based payments. The Company believes this model provides the best estimate of fair value due to its ability to incorporate inputs that change over time, such as volatility and interest rates, and to allow for actual exercise behavior of option holders. The compensation cost is recognized over the expected vesting period. The Company has adopted the provisions of FASB ASC 718, “Stock Compensation” (“ASC 718”), which establishes accounting for equity instruments exchanged for employee services. Under the provisions of ASC 718, stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity grant). New shares of the Company’s common stock are issued for any options exercised. Share based payments to employees and nonemployees are valued at the earlier or a commitment date or completion of services. The Company had no stock-based compensation for the three-months ended September 30, 2022 and 2021. |
NOTE 2 - SUMMARY OF SIGNIFIC_17
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Recent Accounting Pronouncements (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Policies | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recent effective pronouncements issued by the FASB (including its Emerging Issues Task Force, or pronouncements issued but not yet effective, are not believed by management to, have a material impact on the Company's present or future financial position, results of operations or cash flows. |
NOTE 2 - SUMMARY OF SIGNIFIC_18
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Schedule of Going Concern (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Going Concern | September 30, June 30, 2022 2022 Cash on hand $ 65,703 $ 19,939 Working capital (deficit) $ (21,570,993 ) $ (21,872,755 ) Stockholder (deficit) $ (17,334,815 ) $ (17,533,112 ) September 30, 2021 Current quarter net income (loss) $ 60,598 $ (453,448 ) |
NOTE 2 - SUMMARY OF SIGNIFIC_19
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Schedule of pre-bankruptcy obligations (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of pre-bankruptcy obligations | September 30, June 30, 2022 2022 Amount due under the Gold Stream Agreement $9,884,977 $10,379,629 Notes payable and accrued interest 5,847,572 5,736,243 Accounts payable and other accrued liabilities 3,669,213 3,663,249 Total $19,401,762 $19,779,121 |
NOTE 2 - SUMMARY OF SIGNIFIC_20
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Property and Equipment: Schedule of Property, Plant and Equipment, Useful Life (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Property, Plant and Equipment, Useful Life | Vehicles 5 years Mine equipment 7 years General equipment 3-7 years Small tools 1.25 years |
NOTE 2 - SUMMARY OF SIGNIFIC_21
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Net Earnings (Loss) Per Share: Schedule of Potentially Dilutive Securities (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Potentially Dilutive Securities | September 30, 2022 Options to purchase common stock 40,000,000 Warrants to purchase common stock 15,468,816 |
NOTE 2 - SUMMARY OF SIGNIFIC_22
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Net Earnings (Loss) Per Share: Schedule of Earnings Per Share, Basic and Diluted (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Earnings Per Share, Basic and Diluted | Net Income (Numerator) Weighted Average Common Shares (Denominator) Per Share Amount For the three months ended September 30, 2022: Basic EPS Income available to common stockholders $ 60,598 441,504,203 $ 0.00 Diluted EPS Dilutive shares from options and warrants — 54,566,642 0.00 Income available to common stockholders plus assumed conversions $ 60,598 496,070,845 $ 0.00 |
NOTE 3 - PROPERTY AND EQUIPME_2
NOTE 3 - PROPERTY AND EQUIPMENT: Property, Plant and Equipment (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Property, Plant and Equipment | September 30, June 30, 2022 2022 Mine equipment $ 146,399 $ 146,399 General equipment 160,081 160,081 Small tools 4,882 4,882 Mill site property 175,343 175,343 Mill site development costs 35,134 35,134 Land 35,000 35,000 Office equipment 1,068 - 557,907 556,839 Less: accumulated depreciation (136,143 ) (124,721 ) $ 421,764 $ 432,118 |
NOTE 4 -MINERAL RIGHTS_ Acquisi
NOTE 4 -MINERAL RIGHTS: Acquisition costs on mineral properties (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Acquisition costs on mineral properties | September 30, June 30, 2022 2022 Alhambra – Blackhawk project $ 3,115,365 $ 3,115,365 Billali – Jim crow Imperial minerals rights 1,175,000 1,100,000 4,290,365 4,215,365 Less: Accumulated amortization - - Mineral property $ 4,290,365 $ 4,215,365 |
NOTE 5 - ASSETS HELD FOR SALE_
NOTE 5 - ASSETS HELD FOR SALE: Schedule of Assets Held for Sale (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Assets Held for Sale | 42 acres of unimproved residential property $ 25,800 |
NOTE 6 - ACCRUED LIABILITIES_ S
NOTE 6 - ACCRUED LIABILITIES: Schedule of Accrued Liabilities (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following at September 30, 2022 and June 30, 2022: September 30, June 30, 2022 2022 Franchise taxes $ 3,920 $ 3,920 Audit fees 22,750 40,000 Merger costs, net 269,986 269,986 Payroll burden 452,212 414,404 Vacation pay 36,014 36,014 Accrued director fees 750,000 675,000 Other 165,500 144,500 Interest 5,720,475 5,545,439 Commodity Supply Agreement finance fees – See NOTE 10 4,717,077 5,255,827 $ 12,137,934 $ 12,385,090 |
NOTE 7 - NOTES PAYABLE - CURR_2
NOTE 7 - NOTES PAYABLE - CURRENT MATURITIES: Schedule of Notes Payable (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Notes Payable | The following summarizes notes payable: September 30, June 30, 2022 2022 Installment sales note in 48 monthly installments of $13,874, including interest through July 16, 2016 $ 398,793 $ 398,793 Unsecured bridge loan notes payable, interest at 2% monthly, payable August 17, 2014, six months after the first advance on the bridge loan 1,745,092 1,745,092 Current portion of Paycheck Protection Program Loans 9,036 - Note payable, interest at 6% 99,750 99,750 Note payable, 12% 100,000 100,000 $ 2,352,671 $ 2,343,635 |
NOTE 9 - NON-CURRENT NOTES PA_2
NOTE 9 - NON-CURRENT NOTES PAYABLE: Schedule of Long-Term Debt Instruments (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Long-Term Debt Instruments | September 30, June 30, 2022 2022 Notes payable $ 400,000 $ 400,000 Loans payable to bank under the Paycheck Protection Program 100,484 109,520 Accrued interest on Paycheck Protection Program Loans 1,392 1,266 $ 501,876 $ 510,786 |
NOTE 10 - CONTINGENCIES AND C_2
NOTE 10 - CONTINGENCIES AND COMMITMENTS: Schedule of Future Minimum Lease Payments for Finance Lease Liability (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Future Minimum Lease Payments for Finance Lease Liability | Fiscal years ending June 30: Prior year payments to 6/30/2022 $ 1,100,000 2023 300,000 2024 900,000 2025 2,100,000 2026 2,100,000 2027 2,100,000 2028 1,400,000 Total lease payments $ 10,000,000 |
NOTE 11- STOCKHOLDERS' DEFICIT_
NOTE 11- STOCKHOLDERS' DEFICIT: Schedule of Weighted-Average Assumptions Used (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Schedule of Weighted-Average Assumptions Used | September 30, 2022 September 30, 2021 Risk-free interest rate 4.12 % 0.35% - 0.43 % Expected volatility 129.59 % 114.45 – 119.78 % Expected life (years) 3 3 Expected dividend yield 0 % 0 % |
NOTE 11- STOCKHOLDERS' DEFICI_2
NOTE 11- STOCKHOLDERS' DEFICIT: Share-based Payment Arrangement, Option, Activity (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Tables/Schedules | |
Share-based Payment Arrangement, Option, Activity | Stock option and warrant activity for the three months ended September 30, 2022 are as follows: Stock Options Stock Warrants Weighted Weighted Average Average Number of Exercise Number of Exercise Shares Price Shares Price Outstanding at June 30, 2022 40,000,000 $ 0.05 16,010,483 $ 0.056 Granted — — 1,000,000 0.05 Canceled — — — — Expired — — (1,541,667 ) (0.067 ) Exercised — — — — Outstanding at September 30, 2022 40,000,000 $ 0.05 15,468,816 $0.055 Stock options and warrants outstanding and exercisable at September 30, 2022, are as follows: Outstanding and Exercisable Options Outstanding and Exercisable Warrants Weighted Weighted Average Average Contractual Contractual Weighted Exercise Remaining Exercise Remaining Average Price Outstanding Exercisable Life Price Outstanding Exercisable Life Excise Range Number Number (in Years) Range Number Number (in Years) Price $0.05 40,000,000 40,000,000 1.32 $0.05 10,877,149 10,877,149 1.23 - - $0.06 3,416,667 3,416,667 0.41 - - $0.07 975,000 975,000 0.74 — - $0.15 200,000 200,000 1.55 40,000,000 40,000,000 15,468,816 15,468,816 Outstanding Options 1.32 Outstanding Warrants 1.02 $0.055 Exercisable Options 1.32 Exercisable Warrants 1.02 $0.055 |
NOTE 2 - SUMMARY OF SIGNIFIC_23
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Schedule of Going Concern (Details) - USD ($) | 3 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Details | ||||
Net Income (Loss) | $ 60,598 | $ (453,448) | ||
Cash and cash equivalents | 65,703 | 8,847 | $ 19,939 | $ 27,458 |
Working Capital Deficit | (21,570,993) | (21,872,755) | ||
Total stockholders' deficit | $ (17,334,815) | $ (16,169,372) | $ (17,533,112) | $ (16,015,057) |
NOTE 2 - SUMMARY OF SIGNIFIC_24
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Schedule of pre-bankruptcy obligations (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Amount due under the Gold Stream Agreement | $ 9,884,977 | $ 10,379,629 |
Notes payable and accrued interest | 5,847,572 | 5,736,243 |
Accounts payable and other accrued liabilities | 3,669,213 | 3,663,249 |
Total Accounts Payable and Debt Facility Payments that Relate to our Pre-Bankruptcy Debt | $ 19,401,762 | $ 19,779,121 |
NOTE 2 - SUMMARY OF SIGNIFIC_25
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Property and Equipment: Schedule of Property, Plant and Equipment, Useful Life (Details) | 3 Months Ended |
Sep. 30, 2022 | |
Automotive | |
Property, Plant and Equipment, Useful Life | 5 years |
Mine equipment | |
Property, Plant and Equipment, Useful Life | 7 years |
Equipment | |
Property, Plant and Equipment, Useful Life | 3 years |
Small tools | |
Property, Plant and Equipment, Useful Life | 1 year 3 months |
NOTE 2 - SUMMARY OF SIGNIFIC_26
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Warrants and Options (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Details | ||
Costs associated with issued warrants | $ 37,699 | $ 90,633 |
NOTE 2 - SUMMARY OF SIGNIFIC_27
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Net Earnings (Loss) Per Share: Schedule of Potentially Dilutive Securities (Details) - shares | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Stock Options Outstanding | 40,000,000 | 40,000,000 |
Stock Warrants, outstanding | 15,468,816 | 16,010,483 |
NOTE 2 - SUMMARY OF SIGNIFIC_28
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Net Earnings (Loss) Per Share: Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Details | ||
Basic | 441,504,203 | 435,446,486 |
Dilutive shares from options and warrants | 54,566,642 | |
Net Income (Loss) | $ 60,598 | $ (453,448) |
Diluted | 496,070,845 | 435,446,486 |
Net Income (Loss) - Basic and diluted | $ 0 | $ 0 |
NOTE 3 - PROPERTY AND EQUIPME_3
NOTE 3 - PROPERTY AND EQUIPMENT: Property, Plant and Equipment (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Property, Plant and Equipment, gross | $ 557,907 | $ 556,839 |
Less: accumulated depreciation | (136,143) | (124,721) |
Property and equipment, net | 421,764 | 432,118 |
Mine equipment | ||
Property, Plant and Equipment, gross | 146,399 | 146,399 |
Equipment | ||
Property, Plant and Equipment, gross | 160,081 | 160,081 |
Small tools | ||
Property, Plant and Equipment, gross | 4,882 | 4,882 |
Mill site property | ||
Property, Plant and Equipment, gross | 175,343 | 175,343 |
Mill site development costs | ||
Property, Plant and Equipment, gross | 35,134 | 35,134 |
Land | ||
Property, Plant and Equipment, gross | 35,000 | 35,000 |
Office Equipment | ||
Property, Plant and Equipment, gross | $ 1,068 | $ 0 |
NOTE 4 -MINERAL RIGHTS_ Acqui_2
NOTE 4 -MINERAL RIGHTS: Acquisition costs on mineral properties (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Mineral Properties | $ 4,290,365 | $ 4,215,365 |
Accumulated amortization | 0 | 0 |
Mineral property | 4,290,365 | 4,215,365 |
Alhambra - Blackhawk project | ||
Mineral Properties | 3,115,365 | 3,115,365 |
Billali Mine | ||
Mineral Properties | $ 1,175,000 | $ 1,100,000 |
NOTE 5 - ASSETS HELD FOR SALE_2
NOTE 5 - ASSETS HELD FOR SALE: Schedule of Assets Held for Sale (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Assets held for sale | $ 25,800 | $ 202,821 |
NOTE 6 - ACCRUED LIABILITIES__2
NOTE 6 - ACCRUED LIABILITIES: Schedule of Accrued Liabilities (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Franchise taxes | $ 3,920 | $ 3,920 |
Audit fees | 22,750 | 40,000 |
Merger costs, net | 269,986 | 269,986 |
Payroll burden | 452,212 | 414,404 |
Vacation pay | 36,014 | 36,014 |
Accrued director fees | 750,000 | 675,000 |
Other | 165,500 | 144,500 |
Interest | 5,720,475 | 5,545,439 |
Commodity Supply Agreement finance fees - See NOTE 10 | 4,717,077 | 5,255,827 |
Accrued liabilities | $ 12,137,934 | $ 12,385,090 |
NOTE 7 - NOTES PAYABLE - CURR_3
NOTE 7 - NOTES PAYABLE - CURRENT MATURITIES (Details) - USD ($) | 3 Months Ended | ||||||
Jun. 01, 2012 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Apr. 01, 2022 | Sep. 30, 2019 | Jun. 30, 2014 | |
Notes payable, current maturities | $ 2,352,671 | $ 2,343,635 | |||||
Accrued liabilities | 12,137,934 | 12,385,090 | |||||
Notes Payable | |||||||
Debt Instrument, Face Amount | $ 593,657 | ||||||
Debt Instrument, Term | 48 months | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.75% | ||||||
Notes payable, current maturities | 398,793 | 398,793 | |||||
Interest Payable, Current | 185,172 | 179,409 | |||||
Interest Expense, Debt | 5,763 | $ 5,763 | |||||
Notes Payable 2 | |||||||
Debt Instrument, Face Amount | $ 1,745,092 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 24% | ||||||
Notes payable, current maturities | 1,745,092 | 1,745,092 | |||||
Interest Expense, Debt | 3,518,515 | 3,412,949 | |||||
Accrued liabilities | 269,986 | 269,986 | |||||
Notes Payable 3 | |||||||
Debt Instrument, Face Amount | $ 239,750 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 6% | ||||||
Notes payable, current maturities | 9,036 | 0 | |||||
Interest Payable, Current | 30,600 | 29,091 | |||||
Notes Payable 4 | |||||||
Notes payable, current maturities | 99,750 | 99,750 | |||||
Interest Expense, Debt | 1,509 | $ 1,781 | |||||
Notes Payable 5 | |||||||
Debt Instrument, Face Amount | $ 100,000 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 12% | ||||||
Notes payable, current maturities | 100,000 | 100,000 | |||||
Interest Payable, Current | 5,195 | $ 2,170 | |||||
Interest Expense, Debt | $ 3,025 |
NOTE 7 - NOTES PAYABLE - CURR_4
NOTE 7 - NOTES PAYABLE - CURRENT MATURITIES: Schedule of Notes Payable (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Notes payable, current maturities | $ 2,352,671 | $ 2,343,635 |
Notes Payable | ||
Notes payable, current maturities | 398,793 | 398,793 |
Notes Payable 2 | ||
Notes payable, current maturities | 1,745,092 | 1,745,092 |
Notes Payable 3 | ||
Notes payable, current maturities | 9,036 | 0 |
Notes Payable 4 | ||
Notes payable, current maturities | 99,750 | 99,750 |
Notes Payable 5 | ||
Notes payable, current maturities | $ 100,000 | $ 100,000 |
NOTE 9 - COMPLETION GUARANTEE_2
NOTE 9 - COMPLETION GUARANTEE PAYABLE (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Details | ||
Completion guaranty payable | $ 3,359,873 | $ 3,359,873 |
Accrued Interest on Completion Guarantee Payable | $ 1,808,027 | $ 1,763,929 |
NOTE 9 - NON-CURRENT NOTES PA_3
NOTE 9 - NON-CURRENT NOTES PAYABLE (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | |
Non-current notes payable | $ 501,876 | $ 510,786 | |
Notes Payable | |||
Debt Instrument, Face Amount | $ 200,000 | ||
Interest Payable, Current | 36,657 | 26,575 | |
Interest Expense, Debt | 10,082 | ||
Non-current notes payable | 400,000 | 400,000 | |
Loans payable to bank under the Paycheck Protection Program | |||
Non-current notes payable | $ 100,484 | $ 109,520 |
NOTE 9 - NON-CURRENT NOTES PA_4
NOTE 9 - NON-CURRENT NOTES PAYABLE: Schedule of Long-Term Debt Instruments (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 |
Non-current notes payable | $ 501,876 | $ 510,786 |
Notes Payable | ||
Non-current notes payable | 400,000 | 400,000 |
Loans payable to bank under the Paycheck Protection Program | ||
Non-current notes payable | 100,484 | 109,520 |
Accrued interest on Paycheck Protection Program Loans | ||
Non-current notes payable | $ 1,392 | $ 1,266 |
NOTE 10 - CONTINGENCIES AND C_3
NOTE 10 - CONTINGENCIES AND COMMITMENTS (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Dec. 31, 2009 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | |
Proceeds from Commodity Supply Agreement | $ 4,000,000 | |||
Future ongoing payments from Commodity Supply Agreement for the life of the mine, per ounce | $ 400 | |||
Commodity Supply Agreement finance fees - See NOTE 10 | $ 4,717,077 | $ 5,255,827 | ||
Payments to Acquire Mineral Rights | 75,000 | $ 75,000 | ||
Operating Leases, Rent Expense | 1,975 | 1,863 | ||
Office Lease | ||||
Debt Instrument, Periodic Payment | 550 | |||
Operating Leases, Rent Expense | $ 2,175 | $ 1,963 |
NOTE 10 - CONTINGENCIES AND C_4
NOTE 10 - CONTINGENCIES AND COMMITMENTS: Schedule of Future Minimum Lease Payments for Finance Lease Liability (Details) | Sep. 30, 2022 USD ($) |
Details | |
Prior year payments to 6/30/2022 | $ 1,100,000 |
2023 | 300,000 |
2024 | 900,000 |
2025 | 2,100,000 |
2026 | 2,100,000 |
2027 | 2,100,000 |
Thereafter | 1,400,000 |
Finance Lease, Liability, to be Paid | $ 10,000,000 |
NOTE 11- STOCKHOLDERS' DEFICIT
NOTE 11- STOCKHOLDERS' DEFICIT (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Proceeds from issuance of common stock | $ 100,000 | $ 208,500 |
Fair Value Adjustment of Warrants | $ 37,699 | |
Stock Warrants, expired in period | (1,541,667) | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | $ 498,596 | |
Share Price | $ 0.0598 | |
Options and Warrants Vested and Exercisable | 55,468,816 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 0 | |
Costs associated with issued warrants | $ 37,699 | $ 90,633 |
Common Stock | ||
Stock Issued During Period, Shares, New Issues | 2,000,000 | 4,170,000 |
Costs associated with issued warrants | $ 0 | $ 0 |
NOTE 11- STOCKHOLDERS' DEFICI_3
NOTE 11- STOCKHOLDERS' DEFICIT: Schedule of Weighted-Average Assumptions Used (Details) | 3 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 4.12% | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 129.59% | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 3 years | 3 years |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0% | 0% |
Minimum | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 0.35% | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 114.45% | |
Maximum | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 0.43% | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 119.78% |
NOTE 11- STOCKHOLDERS' DEFICI_4
NOTE 11- STOCKHOLDERS' DEFICIT: Share-based Payment Arrangement, Option, Activity (Details) - $ / shares | 3 Months Ended | |
Sep. 30, 2022 | Jun. 30, 2022 | |
Stock Options Outstanding | 40,000,000 | 40,000,000 |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.05 | $ 0.05 |
Stock Warrants, outstanding | 15,468,816 | 16,010,483 |
Stock Warrants, outstanding, weighted average price | $ 0.055 | $ 0.056 |
Stock Warrants, grants in period | 1,000,000 | |
Stock Warrants granted, weighted average price | $ 0.05 | |
Stock Warrants, expired in period | (1,541,667) | |
Stock Warrants expired, weighted average price | $ (0.067) | |
Stock Option 1 | ||
Stock Options Outstanding | 40,000,000 | |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.05 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 40,000,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 1 year 3 months 25 days | |
Warrant Option 1 | ||
Stock Options Outstanding | 10,877,149 | |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.05 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 10,877,149 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 1 year 2 months 23 days | |
Stock Option 2 | ||
Stock Options Outstanding | 0 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 0 | |
Warrant Option 2 | ||
Stock Options Outstanding | 3,416,667 | |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.06 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 3,416,667 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 4 months 28 days | |
Stock Option 3 | ||
Stock Options Outstanding | 0 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 0 | |
Warrant Option 3 | ||
Stock Options Outstanding | 975,000 | |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.07 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 975,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 8 months 26 days | |
Stock Option 4 | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 0 | |
Warrant Option 4 | ||
Stock Options Outstanding | 200,000 | |
Stock Options Outstanding, Weighted Average Exercise Price | $ 0.15 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 200,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 1 year 6 months 18 days | |
Stock | ||
Stock Options Outstanding | 40,000,000 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 40,000,000 | |
Warrant | ||
Stock Options Outstanding | 15,468,816 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Number | 15,468,816 |
NOTE 13 - RELATED PARTY TRANS_2
NOTE 13 - RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 19, 2018 | |
Operating Leases, Rent Expense | $ 1,975 | $ 1,863 | |
Mueller | |||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | 60,000 | ||
Thomas Laws | |||
Secured Promissory Note | $ 930,000 | ||
Costs Associated with Action | 1,651,263 | ||
Costs Associated with Action that have been Collected | 990,632 | ||
Office Lease | |||
Debt Instrument, Periodic Payment | 550 | ||
Operating Leases, Rent Expense | $ 2,175 | $ 1,963 |
NOTE 15 - LEGAL PROCEEDINGS (De
NOTE 15 - LEGAL PROCEEDINGS (Details) - USD ($) | 3 Months Ended | ||||
Dec. 31, 2016 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Sep. 19, 2018 | |
Interest Expense | $ 175,165 | $ 162,186 | |||
Thomas Laws | |||||
Secured Promissory Note | $ 930,000 | ||||
Costs Associated with Action | 1,651,263 | ||||
Costs Associated with Action that have been Collected | 990,632 | ||||
Boart Long year Company | |||||
Debt Instrument, Face Amount | $ 158,480 | ||||
Debt Instrument, Interest Rate During Period | 5.25% | ||||
Interest Expense | 2,097 | 2,097 | |||
Wagner Equipment | |||||
Debt Instrument, Face Amount | $ 115,789 | ||||
Debt Instrument, Interest Rate During Period | 8.75% | ||||
Interest Expense | 2,554 | $ 2,554 | |||
Interest Payable, Current | $ 80,548 | $ 77,994 |