PREPAID EXPENSES AND OTHER CURRENT ASSETS

9 Months Ended

Sep. 30, 2022

PREPAID EXPENSES AND OTHER CURRENT ASSETS

4. Prepaid Expenses And Other Current Assets

NOTE 4 – PREPAID EXPENSES AND OTHER CURRENT ASSETS

On August 17, 2022, the Company executed a Management and Consultancy Services Agreement (the ‘Consultancy Agreement”) whereby a contractor was engaged to render professional services consisting of management and consultancy for the acquisition of surface rights and other technical services near San Guadalupe, Mexico. The parties agreed to total consideration of $1,035,025 plus associated Value Added Tax (“VAT”).

The Company paid $450,000 plus VAT upon execution of the Consultancy Agreement and will pay fifty (50) monthly installments of $11,700 plus VAT. The $450,000 initial installment will be amortized over the fifty (50) month term of the agreement and recognized as expense under “Other operating expenses and exploration”.

Prepaid expenses and other current assets at September 30, 2022 and December 31, 2021 are as follows:

	September 30, 2022			December 31, 2021
Prepaid insurance	$	40,611			-
Prepaid consulting and management fees		432,000			-
Prepaid exploration expense		10,670			-
Other current assets		28,656			-
		511,937			-
Less long-term portion		(324,000	)		-
Prepaid and other current assets	$	187,937			-

The long-term portion of prepaid and other current assets of $324,000 is included in “IVA refund and other assets” on the condensed consolidated balance sheet.