10-12G/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-12G/A

(Amendment 1)

GENERAL FORM FOR REGISTRATION OF SECURITIES

Pursuant to Section 12(b) or (g) of the Securities Exchange Act of 1934

Santa Fe Gold Corporation

(Exact name of Registrant as specified in its charter)

Delaware	84-1094315
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
2325 San Pedro NE, Suite 225 Albuquerque, NM 87110
(Address of principal executive offices)

(505) 255-4852

(Registrant’s telephone number, including area code)

Copies to:

Peder K. Davisson, Esq.

Davisson & Associates, PA

3649 Brunswick Avenue North

Minneapolis, MN  55422

Telephone Number (612) 242-2622

Securities to be registered pursuant to Section 12(b) of the Act: None

Securities to be registered pursuant to Section 12(g) of the Act:

Title of Each Class to be so Registered

Common Shares, par value $0.002

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of a “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act or Emerging Growth Company.

Large Accelerated Filer	¨	Accelerated Filer	¨
Non-Accelerated Filer	¨	Smaller Reporting Company	x
		Emerging Growth Company	¨

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

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EXPLANATORY NOTE

This registration statement on Form 10 (the “Registration Statement”) is being filed by Santa Fe Gold Corporation (the “Company” or “Registrant”) in order to register common stock of the Company voluntarily pursuant to Section 12(g) under the Securities Exchange Act of 1934, as amended (the “Exchange Act. ”) The Company is not required to file this Registration Statement pursuant to the Securities Act of 1933, as amended (the “Securities Act .”)

Once this registration statement is deemed effective, we will be subject to the requirements of Regulation 13A under the Exchange Act, which will require us to file annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and we will be required to comply with all other obligations of the Exchange Act applicable to issuers filing registration statements pursuant to Section 12(g) of the Exchange Act.  The registration statement, including exhibits, may be inspected without charge at the U. S. Securities & Exchange Commission’s (the “SEC” or “Commission”) principal office in Washington, D.C., and copies of all or any part thereof may be obtained from the Public Reference Section, Securities and Exchange Commission, 100 F Street, NW, Washington, D.C. 20549 upon payment of the prescribed fees. You may obtain information on the operation of the Public Reference Room by calling the SEC at  l.800.SEC.0330. The SEC maintains a Website that contains reports, proxy and information statements and other information regarding registrants that file electronically with it. The address of the SEC’s Website is http://www.sec.gov. 

A NOTE ON READING

CERTAIN ITEMS CONTAINED IN THIS REGISTRATION STATEMENT

AND

THE NOTES TO THE FINANCIAL STATEMENTS

CONTAINED HEREIN

(Industry Guide 7 vs. Regulation S-K 1300 et. seq.)

The SEC has changed the disclosure requirements for mining companies from Industry Guide 7 and to Regulation S-K 1300 et. seq. for all registrants. This change to disclosure is being phased in after January 1, 2021. Mining companies are required to have their disclosure compliant with Reg S-K 1300 after their fiscal year begins in 2021. As such, the Registrant will be required to have its periodic reports compliant with Reg S-K 1300 et. seq. beginning with its fiscal year beginning July 1, 2021.   

The audited financial statements and notes thereto and for the two fiscal years ended June 30, 2021 and 2020 (as Restated), all of which are contained in this Form 10 Registration Statement, were prepared in compliance with Industry Guide 7. The accounting and definitions used in the notes to the financial statements for the Company’s fiscal years ending June 30, 2021 and 2020 (as Restated) were prepared in compliance with Industry Guide 7 since Regulation S-K 1300 et. seq. was not applicable during these annual periods. However, since there are disclosures made in this Registration Statement that are made to be current when the Registrant’s Registration Statement is effective and since this is after June 30, 2021, the disclosure made in certain Items that is not solely based on an historical presentation for periods prior to July 1, 2021 has been made in compliance with Regulation S-K 1300 et. seq. The definitions used in Industry Guide 7 and Regulation S-K 1300 are very similar to one another however there are differences. Therefore, the reader should be aware that the notes to the financial statements were prepared in compliance with Industry Guide 7 and the balance of this Registration Statement, as amended, was prepared in compliance with Regulation S-K 1300 et. seq., specifically Items 1 Business, 1A Risk Factors, 2 Financial and Item 3 Properties. Therefore, those terms that have specific definitions in Regulation S-K 1300 have those meanings ascribed to them by the regulation.

A NOTE CONCERNING CERTAIN FINANCIAL INFORMATION

CONTAINED IN THIS REGISTRATION STATEMENT FILED ON FORM 10

This Form 10 contains the audited consolidated financial statements and notes thereto for the years ended June 30, 2021, June 30, 2020 (as Restated) and June 30, 2019 (as Restated); as well as the unaudited interim consolidated financial statements and the notes thereto for the periods ended March 31, 2022 and March 31, 2021. The Company previously filed Registration Statements on Form 10 that contained audited consolidated financial statements and the notes thereto for the preceding two-year period as well as unaudited consolidated financial statements and the notes thereto. However, these earlier Registration Statements filed on Form 10 were withdrawn in order to allow the Company the time needed to address comments received from the Staff of the U.S. Securities and Exchange Commission (“Commission” or “SEC”) and to allow the Commission Staff the time needed to review the Company’s responses to those comments, in each case so that the Registration Statement(s) would not become effective by laps of the 60-day period while there remained unresolved SEC comments. One of the recurring comments the Company has received has been focused on the write-down of approximately $12 million in liabilities. The audited consolidated financial statements that have been included as part of the prior Form 10 Registration Statements, as well as prior periodic reports, specifically those in the Form 10-K filed that include the period ending June 30, 2019 filed with the Commission on July 15, 2020 contain the Company’s consolidated financial statements that were prepared with the aforementioned write-down of liabilities in the amount of approximately $12 million. The Commission is concerned about the Company taking this write-down because FASB ASC 405-20-40-1(b) 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.” The Company and its auditors had secured legal opinions from two different law firms stating that the statute of limitations had run with respect to the aforementioned liabilities. However, without release of liability from the creditors or a court

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of competent jurisdiction, or in the alternative an opinion of counsel that met the requirements of what is sometimes referred to as a “would” or “will” opinion, the Commission Staff took the position that the correct treatment of the aforementioned liabilities was to continue carrying them on the Company’s balance sheets.  In requiring a “will” or “would” opinion, the Commission is looking for greater assurance that the Company “would” or “will” be successful in the event that one of the creditors sought to collect on the liabilities. Although this standard may seem subjective, “will opinions” are used in the context of tax law where a tax opinion is needed. In that context the term “will” means that the drafter of the opinion believes and is effectively stating that there is a 90%-95% probability that a given result “will” come to pass based on the facts present. The Company was not able to procure a judicial order in a timely manner, specific written agreement of the creditors nor an opinion of counsel meeting the “would” or “will” standard, therefore it determined the most expeditious course of action was to restate the consolidated financial statements so that the liabilities that were written-off are now included in the liabilities of the Company once again; in effect, restating the consolidated financial statements as of June 30, 2019. Since the impact these liabilities have on the Company’s consolidated financial statements continues to roll forward, this Registration Statement filed on Form 10 with the Commission also includes the audited consolidated financial statements for the fiscal year ended June 30, 2019, as restated to include the approximately $12 million in previously written-off liabilities; as well as the audited consolidated financial statements for the fiscal years ending June 30, 2020 (as Restated) and June 30, 2021 as well as the interim periods ending March 31, 2021 and March 31, 2022.

Non-Reliance on Previously Issued Financial Statements or a Related Audit Report

We have not filed and do not intend to file an amendment to any of our previously filed periodic reports filed on Form 10-K for the fiscal years ended prior to June 30, 2019 or to any previously filed periodic reports filed on Form 10-Q prior to the fiscal year ended June 30, 2021 since this Registration Statement will represent the most recent and accurate consolidated financial statements once it has gone or been made effective. Prior to the filing of this Form 10, the Company has filed interim periodic reports on Form 10-Q for the quarters ended September 30, 2017 through the quarter ended March 31, 2020. Readers are cautioned not to rely on the information contained in the Company’s consolidated financial statements outside of this Registration Statement filed on Form 10 except for periodic reports filed by the Company following its effective date.

Non-Reliance on Previously Issued Financial Statements or a Related Audit Report

On October 1, 2018, we disclosed in a Form 8-K that the board of directors formed a special committee in September 2018 to investigate and analyze certain financial transactions in the aggregate amount of approximately $1 million that occurred primarily between July 2016 and March 2018 involving Tom Laws (our former chief executive officer).  The special committee investigation has 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 $809,534 in cash and properties with an estimated current net market value of $209,800 as of the date of filing of this Form 10. The Company has proceeded against Mr. Laws to collect the balance. The Company does not anticipate collection a material portion of the amount due us, See Item 3, “Legal Proceedings for additional detail.

The Company concluded that these financial transactions materially impacted the previously issued consolidated financial statements for, and financial information relating to, the fiscal year ended June 30, 2017.  These financial statements for the fiscal year ended June 30, 2017 previously filed should not be relied upon. The Company’s financial statements for the fiscal year ended June 30, 2017, have been restated and filed with the SEC.

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Table of Contents

For Form 10

of

Santa Fe Gold Corporation

Item 1.	Business	5
Item 1A.	Risk Factors	13
Item 2.	Financial Information	28
Item 3.	Properties	37
Item 4.	Security Ownership of Certain Beneficial Owners and Management	52
Item 5.	Directors and Officers	52
Item 6.	Executive Compensation	53
Item 7.	Certain Relationships and Related Transactions, and Director Independence	54
Item 8.	Legal Proceedings	55
Item 9.	Market Price of and Dividends on the Registrant’s Common Equity and Related Stockholder Matters	56
Item 10.	Recent Sales of Unregistered Securities	57
Item 11.	Description of Registrant’s Securities to be Registered	57
Item 12.	Indemnification of Directors and Officers	58
Item 13.	Financial Statements and Supplementary Data	58
Item 14.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	58
Item 15.	Exhibits, Financial Statement Schedules	59

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Santa Fe Gold Corporation

INFORMATION REQUIRED IN REGISTRATION STATEMENT

Item 1. Business.

Company History and Overview of Events. 

We are an exploration stage mining company, in the business of acquiring and developing metal and mineral properties that may contain recoverable gold and silver deposits. Our general business strategy is to acquire and develop mining properties positioned for low-cost production. We were originally incorporated in the State of Delaware on August 8, 1991 under the name Azco Mining, Inc. and on August 21, 2007, we changed our name to Santa Fe Gold Corporation by filing a Certificate of Amendment with the Delaware Secretary of State.  

As an exploration mining company, we are engaged in the business of acquiring and developing mines and mining properties as well as securing production from existing and developed mining and mineral properties.  Currently we own certain mining leases and other mineral rights, however none of them contain any proven or probable reserves, as defined in Regulation S-K 1300; and they are all currently considered “exploratory” in nature. Currently we have three projects, each of which management has determined is “material” based on the costs to secure the rights associated with them, as required by Regulation S-K 1304, these are: our Alhambra Property, the Jim Crow Imperial Mine and the Billali Mine, each of which is exploratory in nature and is described more fully below.

Overview of Events

As a mining company in the exploration stage, we are engaged in the business of acquiring mineral properties that may contain recoverable mineral deposits, (we are currently targeting gold and/or silver deposits) with a view to develop them and, if there are mineral resources identified or mineral reserves, to actively mine them.  Although management is optimistic about its prospects for favorable exploration results on the properties in which it has acquired interests, to date no mineral reserves have been determined.  There are however minimal mining activities that have commenced and the Registrant has conducted limited extraction activity. Nevertheless, there can be no assurance that they will continue or, that if they do, that the any mining activities will be profitable, with or without mineral reserves.  

After dismissal from bankruptcy in June 2016, although we had no assets and approximately $20 million of indebtedness that was reinstated, we were able to continue as an exploration stage company through the diligent efforts of our officers and directors. Thereafter, a portion of this debt was later written off at June 30, 2019 based upon the applicable statute of limitations for British Columbia, Canada; as the collectability was determined to be time barred, as set forth in the legal opinions addressing these issues. Upon review the SEC Staff was concerned about the Company taking this write-down because FASB ASC 405-20-40-1(b) 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.” However, without release of liability from the creditors or a court of competent jurisdiction, or in the alternative an opinion of counsel that met the requirements of what is sometimes referred to as a “would” or “will” opinion, the Commission Staff took the position that the correct treatment of the aforementioned liabilities was to continue carrying them on the Company’s balance sheets.  In requiring a “will” or “would” opinion, the Commission is looking for greater assurance that the Company “would” or “will” be successful in the event that one of the creditors sought to collect on the liabilities. Although this standard may seem subjective, “will opinions” are used in the context of tax law where a tax opinion is needed.  In that context the term “will” means that the drafter of the opinion believes and is effectively stating that there is a 90%-95% probability that a given result “will” come to pass based on the facts present. The Company was not able to procure a judicial order in a timely manner, specific written agreement of the creditors nor an opinion of counsel meeting the “would” or “will” standard, therefore it determined the most expeditious course of action was to restate the consolidated financial statements so that the liabilities that were written-off are now included in the liabilities of the Company once again; in effect, restating the consolidated financial statements as of June 30, 2019. Since the impact these liabilities have on the Company’s consolidated financial statements continues to roll forward, this Registration Statement filed on Form 10 with the Commission also includes the audited consolidated financial statements for the fiscal year ended June 30, 2019, as restated to include the approximately $12 million in previously written-off liabilities; as well as the audited consolidated financial statements for the fiscal years ending June 30, 2020 (as Restated) and June 30, 2021 as well as the interim periods ending March 31, 2021 and March 31, 2022. Various other notes payable and incurred debt obligations were settled on negotiated written basis for a reduced cash settlement amount and the resulting net balances were forgiven.

Management’s continuing efforts were successfully rewarded as the Company secured, what management believes will ultimately be, promising mining leases and other mineral rights. The properties we now own are exploratory in nature and consist of certain mining leases and other mineral rights. As stated, they were acquired subsequent to our dismissal from bankruptcy proceedings and, although management is optimistic, none of them contain any proven and probable reserves.  We are in the process of raising the capital required, in part (i) to begin further exploration activities of these current mining properties, and (ii) to help meet our working capital requirements. There can be no assurances that we will be successful in raising the capital necessary to implement our business plan or that, if we are successful in raising such capital, that there may not be additional or superseding demands on our capital resources. Although the Company has been successful in meeting its capital requirements in the past, and since emerging from Bankruptcy, management continues to be optimistic about its ability

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to continue securing the funding needed to execute on its business plan, any failure to do so or any unforeseen expenses or other demands on the Company’s capital could result in the need to curtail or cease some or all of the Company’s operations, resulting in losses to investors.

The Company’s common stock has been quoted on OTC Markets (PINK) most recently under the trading symbol “SFEG.” However, in July 2020 it received notice that on June 25, 2020, the U.S. Securities and Exchange Commission (the “SEC” or “Commission”) issued an order suspending trading under Section 12(k) of the Securities Exchange Act of 1934, as amended (the “Exchange Act.”). Thereafter, the Commission commenced administrative proceedings to de-register the Company’s common stock under Section 12(j) of the Exchange Act.  Issuers of securities registered pursuant to Section 12 of the Exchange Act are required under Section 13(a) of the Exchange Act and the rules promulgated thereunder to file current and accurate information in periodic reports with the Commission. Specifically, Exchange Act Rule 13a-1 requires issuers to file annual reports, and Exchange Act Rule 13a-13 requires domestic issuers to file quarterly reports. The Company’s inability to prepare and file the required quarterly and annual reports began with the misappropriation of funds by its former CEO; this had a direct impact on its financial statements as originally filed. This not only resulted in the need to amend and restate the 2017 annual report and related quarterly reports that had been filed with the Commission on Form 10-K and on Forms 10-Q, but since a restatement necessarily has a material effect on all future reports, the Company was not in a position to confidently restate its financial statements until it was able to fully and accurately define the scope of: (a) the issue created by Mr. Laws and (b) the subsequent actions taken against Mr. Laws by the Company and other unrelated parties. Compounding the issue, the Company’s auditor declined to continue auditing the Company’s financial statements, management believes, due to its potential liability and the conflicts that could result from any of the Law’s proceedings. Thereafter, the Company had difficulty engaging a replacement audit firm, in part because of the perception of risk associated with the required restatements of its financial statements.

Ultimately, while the underlying circumstances that gave rise to the Company’s delinquent filings were, in part, caused by an individual who was dismissed upon discovery of his misappropriation of funds, the difficulty in finding a replacement audit firm was an additional factor that was beyond the control of management that contributed substantially to delays in our filings. Although we have since filed the Annual Reports that were delinquent, one of which required restating our financials and all but three of the Quarterly Reports that were delinquent have since been filed, the Commission’s standard position has been that, once de-registration proceedings are commenced for failure to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder, it will not then grant a right to cure or comply.  Thus, when the Commission then commenced administrative proceedings under Section 12(j), the Registrant’s only options were to defend the matter in litigation or to settle it and agree with the Commission’s order for de-registration of securities registered under Section 12(j) of the Exchange Act. Therefore, given: (a) the protracted nature of litigation in general, and (b) the high expense associated with defending an adversary proceeding with the Commission and (c) the low probability of a successful outcome, compared with the fact that: (x) a settlement with the SEC would allow the Company to re-file a registration statement as soon as it was drafted, (y) the Company had already completed one of the required audits, was in a position to complete the other, and was in a position to file a Registration Statement on Form 10, and (z) Form 10 Registration Statements are automatically effective 60 days from the date of filing (unless the Commission objects, which is rarely done, although it is now common to receive comments by the Commission that then must be addressed). After considering the forgoing, the Company determined that it was in the best interest of its shareholders to settle and consent to the de-registration of its common stock and to file this Registration Statement on Form 10.

On December 17, 2020, the SEC order suspending trading went into effect. This Registration Statement filed on Form 10, is the next step in the Company’s plan to have its shares resume trading. In connection with the filing of this Registration Statement, the Company plans to work with a registered broker-dealer, as a sponsoring market maker, to update and file its Form 211 under Rule 15c-211 with the Over-The-Counter market platforms (’OTC”) and Financial Industry Regulatory Authority (“FINRA”). There can be no assurances that the Company will find a market maker that is willing to sponsor the Company’s Form 211 filing or that if sponsored, that there may not be difficulties in satisfying FINRA that could result in substantial delays for the Company to resume trading and quotation of bids and offers for its common stock on OTC Markets.

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Company Organizational Chart

 

Company Subsidiaries, Operations and Properties

The Company conducts its operations in its subsidiaries. In addition, at times it has acquired its interest in a specific property through an acquisition of the shares of stock in a company that holds specific mining claims. The following is a list of the subsidiaries of the Company that hold mining claims and / or where the Company, through its subsidiaries, is conducting its operations.

Santa Fe Acquisitions, LLC

Santa Fe Acquisitions, LLC was established as a single member limited liability company, a wholly owned subsidiary of the Company for the purpose of acquiring Bullard’s Peak Corporation. Its sole asset is the common stock of Bullard’s Peak Corporation and it has no other assets or operations.

Bullard’s Peak Corporation

As a wholly owned subsidiary of the Company, Santa Fe Acquisitions, LLC acquired Bullard’s Peak Corporation pursuant to a stock purchase agreement dated August 2017, the Company’s subsidiary, Santa Fe Acquisitions, LLC, 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 (also referred to as the “Alhambra Property.”)  The seller was granted a 2% net smelter return in perpetuity on all patented and unpatented claims.  The net smelter return is based on the greater of (i) all monies the Company receives for or from any and all ore removed from the property comprising the mining claims whether for exploration, mining operations or any other reason, and (ii) the fair market value of removed ore from the property comprising the mining claims.  

There were no mining operations being conducted on the property on the date of acquisition.  Based on the Company’s analysis and understanding of documents obtained from outside sources and the sellers’ representations, no mining operations have been conducted on the property for the last five years. This is based on records from the New Mexico Department of Mines reflecting that they have no records of mining or exploration permits having ever been issued to any entity called Bullard’s Peak Corporation. A review of filed corporate tax returns also reflects that there have been no operational activities or exploration.

In reaching the conclusion that it did not acquire a business or a business combination, the Company considered Accounting Standards Update 2017-01 Business Combinations (Topic 805). Based upon the Company’s review of the guidance provided by FASB’s Business Combinations (Topic 805) the updates thereto and outside independent documentation for this acquisition, management has concluded that it does not meet the requirements of acquiring a business or a business combination. All assets acquired are concentrated in a single identifiable asset, Land. The Company relies on Sections 805-10-55-5, 805-10-55-5A and 805-10-55-5B that identify the acquisition is not considered a business or business combination.

To date, there has been no mining and only very limited exploration activities at this mine site, as defined under Reg. S-K 1300. With limited information, the Company has done preliminary exploratory work in an to determine, if possible, if the site had sufficient mineral content that may make it financially viable to mine and it determined that it will need to complete future exploration activity on the property prior to preparing a proper mining plan for the site. The Company currently considers the location as an exploration property with required geological work yet to be performed.

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On December 1, 2020, the Company made a joint announcement with Texas Mineral Resources Corp. (“TMRC”) (OTCQB:TMRC) of the execution of a letter agreement to pursue, negotiate and subsequently enter into a 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. As of the filing of this Form 10, a portion of these activities has commenced as disclosed in a TMRC press release in November 2021.

Mineral Acquisitions, LLC

Under the ROU agreement, the Company formed a wholly-owned subsidiary, Mineral Acquisitions, LLC, that entered into an Agreement with a mining operator in January 2019 to purchase two properties in western New Mexico, known as the Billali Mine and the Jim Crow Imperial Mine (the “Billali Agreement” and the “Jim Crow Agreement.” Based upon the terms and conditions in the agreement, the Company is treating this agreement as a Right of Use (“ROU”) asset lease.

The purchase price for all rights and interests to be conveyed is $2,500,000 for the Billali Mine and $7,500,000 for the Jim Crow Imperial Mine, each documented as separate definitive agreements, with aggregate consideration for both definitive agreements payable as follows pursuant to Amendment Five to the aforementioned agreements dated effective December 31, 2020:

(i)Six Hundred Twenty-Five Thousand Dollars ($625,000) has been paid by Buyer to Seller as of the date of this Amendment. 

(ii)On January 8, 2021 $25,000 will be paid, on or prior to January 31, 2021 $25,000 will be paid, on or prior to February 28, 2021 $50,000 will be paid, and commencing on April 1, 2021 and continuing on the first day of each subsequent month thereafter, a monthly payment of $25,000 will be paid until (A) the mill processing plant to create concentrate is in operation and (B) we received our first payment for shipment of such concentrate from the mill (satisfaction of these two items is referred to as “Milestone”).  Upon satisfaction of this Milestone and commencing on the first day of the following month and continuing the first day of each subsequent month thereafter, Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000) until a total of One Million Six Hundred Thousand Dollars ($1,600,000) has been paid. 

(iii)Commencing 30 days after the last payment in (ii) above and continuing with 48 subsequent payments every 30 days thereafter, Buyer will pay to Seller the sum of One Hundred Seventy-Five Thousand Dollars ($175,000.00 per period until the total purchase price of $10,000,000 has been paid.  

(iv)Each payment made hereunder will be allocated Twenty-Five per cent (25%) to the Billali and Seventy-Five percent (75%) to the Jim Crow, Imperial. 

As of the date of filing this document the Company has paid $1,000,000 on the obligation. and is in default of payment due on June 1, 2022 payment of $25,000. The Company anticipates it will make this payment in default by the end of February 2022, as required. The ROU agreement(s) have a 5% net smelter return (“NSR”) royalty on the nine patented Lode Claims up to $650,000, and a 3% NSR royalty thereafter. Title and all rights and interest in the properties will be conveyed under the ROU agreements upon completion of the payments of the purchase prices of the properties. The Company has the right to cancel the ROU agreement(s) at any time. Minerals Acquisitions, LLC was transferred the Jim Crow Mine permit on August 20, 2019, from the selling party. The Company leases water rights for the mine site. The Company began initial site mining preparations at the Jim Crow Mine during the last calendar quarter of 2019 and carried out mining activity in the third calendar quarter of 2020, although because it has no reported reserves it is still considered an exploratory property under Reg. S-K 1300. During this period, we were inventorying the mined head ore to be processed at our future processing mill to be constructed on our property in Duncan, Arizona. Our original business plan was to have our head ore processed at a nearby smelter.  However, the smelter’s management subsequently decided not to accept any outside material for processing. With this change and decision, the Company has determined that its best course of action is to design and construct its own mill, on site and to immediately begin work to secure a financing facility to fund construction of the mill. The project will include the research and documentation for precious metals recovery, mill design and required equipment and the specifications by a specialty engineering firm in Denver, Colorado that has expertise in mining and milling operations. The Company closed on the acquisition of the Duncan, Arizona property on November 9, 2021.

The Company considers this ROU property to be an exploration property and will capitalize the payments under the agreement(s) as made to the sellers for the mineral interest. When the Company begins receiving revenue from these projects, of which there can be no assurance, it will amortize the capitalized payment balance each quarter thereafter. Companies that have disclosed reserves, as defined in Regulation S-K 1300, (previously under Industry Guide 7) 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 properties that have no reserves disclosed that remain considered as “exploration properties,” as defined in Regulation S-K 1300, 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

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determined a geologist or other qualified person, as may be necessary. Since we do not have the reliable information needed to use a units-of-production methodology, we will amortize our capitalized costs on a straight-line basis over the estimated life of the mine sites. Because of these and other differences, our financial statements may not be directly comparable to the financial statements of other mining companies that have established reserves on their properties.

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 leases. 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.

If the Company has breached the ROU agreement, the seller is required to notify the Company in writing of the specific breach. If the alleged breach  is not cured within 30 days after the notice of default is given or if the Company has neither 1.) commenced to cure the alleged breach or 2.)diligently completed such cure, then the seller may terminate the ROU agreement by delivering the Company written notice of such termination, provided, however, that in the event the Company challenges the legitimacy of the alleged breach and/or the claimed failure to cure or to commence curing, the Company may give written notice to the seller within such 30-day period setting forth such fact. If Seller gives written notice within 15 days of the Company’s notice that it rejects the Company’s position, then the ROU agreement, as amended, shall not be terminated until there is a final judicial determination by a court of competent jurisdiction that a default exists. However then if the Company satisfies any final judgment within 30 days following its entry, the ROU agreement, as amended, is not terminated. If the seller does not provide notice of a breach to the Company, the seller is deemed to be in agreement that the Company is not in breach of the ROU agreement, as amended. To further assist the Company in determining if it acquired a business or the transaction was considered a business combination, it looked to Accounting Standards Update 2017-01 Business Combinations (Topic 805). Based upon the Company’s review of the ROU agreement, only the purchase of certain patented and unpatented mining claims, as detailed in the ROU agreement, formed the basis of the seller’s contract rights transferred. Ownership transfers of these claims are not to be transferred until the amount specified in the ROU agreement is paid in full. The Company has reviewed the tax returns of the sellers for their calendar tax years 2016-2018, which indicate that no operations had occurred in those years. Based upon the Company’s review of FASB’s Business Combinations (Topic 805), the updates mentioned and review of the acquisition documentation, the acquisition did not meet the requirements for acquisition accounting treatment. All “assets” to be acquired were concentrated in a single identifiable asset or group of similar identifiable assets (patented mining leases), as described in the agreements. The Company relied on Sections 805-10-55-5, 805-10-55A and 805-10-55-5B to reach the conclusion that the transaction was not considered an acquisition of a business or a business combination.

On November 9, 2020 the Minerals Acquisition, LLC acquired, by quick claim deed, an additional nine (9) BLM claims in the Steeple Rock Mining District in Grant County, New Mexico and will be associated with the Jim Crow-Imperial Mine and Billali Mine mineral rights in the Steeple Rock Mining District.

The Lordsburg Mining Company, AZCO Mining, Inc. and Santa Fe Barbados Corporation

The Lordsburg Mining Company, AZCO Mining, Inc. and Santa Fe Barbados Corporation are all subsidiaries that have not been active since we emerged from bankruptcy since they have no assets or operations. The Company does not intend to use any of these subsidiaries for future operations and will dissolve them in due course.

Malone Mine and Playa Hidalgo Placer - Old New Mexico Properties Acquisitions

In August 2017, the Company acquired the Malone Mine claims and Playa Hidalgo Placer claims. On October 23, 2017, the Pinos Altos claims were purchased for an aggregate of $500. These mining claims are located in Grant County and Hidalgo County, New Mexico.  These claims are owned directly by the Company and not through any of our subsidiaries. The Company does not have any immediate plans with respect to them.

British Columbia Properties

On November 30, 2017, the Company entered into substantially identical agreements with Fortune Graphite, Inc. and Worldwide Graphite Producers, Ltd. to acquire a total of four placer claims for aggregate consideration of Can$400,000 and the issuance of 10,000,000 shares of the Company’s common stock.  Title to these claims was to remain in trust with the sellers until payment was made in full. To date, the Company has paid Can$260,000.  The Company owed the sellers Can$140,000 and 10,000,000 shares of Company common stock under the agreement. However, in February 2019, based upon additional information that surfaced and our subsequent scrutiny and analysis of the transaction, the Company initiated an arbitration proceeding against the seller to void and rescind the purchase of these British Columbia properties. In addition to voiding and rescinding the transaction, the Company sought additional remedies. In October 2020, the arbitrator ruled in favor of the Company and the 10,000,000 shares reserved under the agreements were nullified and canceled. In connection with this arbitration, the Company’s legal position was to void the transaction and, due to the uncertainty of the outcome, provide an impairment

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which at June 30, 2019, was in the amount of $210,116. A deposit of $54,000 was made by the seller for the arbitration and the arbitrator will determine the distribution of this amount. The Company has filed with the arbitrator for reimbursement of all legal costs associated with the arbitration and any other amounts to be awarded. In February 2021, the Company was awarded approximately $53,000, and after payment of legal fees, received net proceeds from our attorney of approximately $4,500.

Principal Products and Markets.

The potential principal products are refined gold and silver from mined concentrated head ore. These concentrates will be refined by overseas refiners that the Company has utilized previously and with whom it has historically had a good relationship. Upon completion of the refining process, the refinery will purchase the precious metals based upon an agreement with the Company that is negotiated annually.

Key Vendors, Suppliers, and Distribution Methods

The Company’s key suppliers are fuel providers, equipment repair companies and suppliers of mining equipment, parts and supplies.

Dependence on One or a Few Major Customers

None.

Competition

The mining industry is highly competitive. We will be competing with numerous companies, substantially all of which have far greater resources available to them than we are likely to have when we commence operations. We therefore may be at a significant disadvantage in the course of obtaining materials, supplies, labor, and equipment from time to time. Additionally, we are, and will continue to be, an insignificant participant in the business of mining exploration and development for the foreseeable future.  

Compliance with Government Regulations

Overview

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

The mining industry, (specifically the activities of exploration, drilling) operate in a legal environment that requires permits to conduct virtually all operations. Thus, permits are required by local, state and federal government agencies.   Local authorities, usually counties, also have control over mining activity.  The various permits address such issues as prospecting, development, production, labor standards, taxes, occupational health and safety, toxic substances, air quality, water use, water discharge, water quality, noise, dust, wildlife impacts, as well as other environmental and socioeconomic issues.  

Like all other mining companies doing business in the United States, we are subject to a variety of federal, state and local statutes, rules and regulations designed to protect the quality of the air and water, and to protect threatened or endangered species, in the vicinity of our mining operations. These include “permitting” or “pre-operating approval” requirements that are designed: (i) to ensure the environmental integrity of a proposed mining facility, (ii) to ensure operating plans are designed to mitigate the effects of discharges into the environment during exploration, mining operations, and reclamation and (iii) that post-operation plans are designed to remediate the lands affected by a mining facility once commercial mining operations have ceased.

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

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

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Mining Operations

The exploration of mining properties and development and operation of mines is governed by both federal and state laws.  The State of New Mexico likewise requires various permits and approvals before mining operations can begin, although the state and federal regulatory agencies usually cooperate to minimize duplication of permitting efforts. The State of New Mexico Mining and Minerals Division requires mine permits for each mining location. The permit has an Annual Permit Fee that is due by April 30 of each year. The Annual Permit Fee for minimal impact mines is currently $250.

Prior to receiving the necessary permits to explore or mine, the operator must comply with all regulatory requirements imposed by all governmental authorities having jurisdiction over the project. Generally, in order to obtain the requisite permits, the operator must have its land reclamation, restoration or replacement plans pre-approved. Specifically, the operator must present its plan to restore or replace the affected area. Often these requirements result in delays and/or costly studies or changes in the proposed activities; which may extend the time to completion. Although this may be necessary in order to mitigate the negative impact of certain aspects of an initial plan, all of these factors make it more difficult and costly to operate; and have a negative, and sometimes fatal, impact on the economic viability of the exploration or planned mining operation. Finally, it is possible that future changes in laws or regulations could have a significant impact on our business, requiring the planned activities to be economically reevaluated at that time.

Effect of Existing or Potential Government Regulations

Mineral exploration, including mining operations is subject to governmental regulation. Our operations may be affected in varying degrees by government regulation such as restrictions on production, price controls, tax increases, expropriation of property, environmental and pollution controls or changes in conditions under which minerals may be marketed. An excess supply of certain minerals may exist from time to time due to lack of markets, restrictions on exports, and numerous factors beyond our control. These factors include market fluctuations and government regulations relating to prices, taxes, royalties, allowable production and importing and exporting minerals. The effect of these factors cannot be accurately determined, and we are not aware of any probable government regulations that would impact the Company at this time, although there can be no assurances that regulations may not arise in the future. To the extent that government regulations do arise in the future, they may have a negative effect on our operations, which may in turn, result in losses to investors. This section is intended as a brief overview of the laws and regulations described herein and is not intended to be a comprehensive treatment of the subject matter.

Environmental Laws

Federal legislation in the United States and implementing regulations adopted and administered by the Environmental Protection Agency, the Forest Service, the Bureau of Land Management, the Fish and Wildlife Service, the Army Corps of Engineers and other agencies—in particular, legislation such as the federal Clean Water Act, the Clean Air Act, the National Environmental Policy Act, the Endangered Species Act, the National Forest Management Act, the Wilderness Act, and the Comprehensive Environmental Response, Compensation and Liability Act—have a direct bearing on domestic mining operations. These federal initiatives are often administered and enforced through state agencies operating under parallel state statutes and regulations.

The Clean Water Act.  The Federal Clean Water Act is the principal Federal environmental protection law regulating mining operations in the United States as it pertains to water quality.  At the state level, water quality is regulated by the New Mexico Environment Department.  If our exploration or any future development activities could affect a ground water aquifer, we are required to apply for a ground water discharge permit in compliance with the groundwater regulations. If exploration affects surface water, then compliance with surface water regulations is required.

The Clean Air Act.  The Federal Clean Air Act establishes ambient air quality standards, limits the discharges of new sources and hazardous air pollutants and establishes a federal air quality permitting program for such discharges. Hazardous materials are defined in the Federal Clean Air Act and enabling regulations adopted under the Federal Clean Air Act to include various metals. The Federal Clean Air Act also imposes limitations on the level of particulate matter generated from mining operations.

National Environmental Policy Act (“NEPA”).  NEPA requires all governmental agencies to consider the impact on the human environment of major federal actions as therein defined.

Endangered Species Act (“ESA”).  The ESA requires federal agencies to ensure that any action authorized, funded or carried out by such agency is not likely to jeopardize the continued existence of any endangered or threatened species or result in the destruction or adverse modification of their critical habitat. In order to facilitate the conservation of imperiled species, the ESA establishes an interagency consultation process. When a federal agency proposes an action that “may affect” a listed species, it must consult with the USFWS and must prepare a “biological assessment” of the effects of a major construction activity if the USFWS advises that a threatened species may be present in the area of the activity.

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National Forest Management Act.  The National Forest Management Act, as implemented through Title 36 of the Code of Federal Regulations, provides a planning framework for lands and resource management of the National Forests. The planning framework seeks to manage the National Forest System resources in a combination that best serves the public interest without impairment of the productivity of the land, consistent with the Multiple Use Sustained Yield Act of 1960.

Wilderness Act.  The Wilderness Act of 1964 created a National Wilderness Preservation System composed of Federally owned areas designated by Congress as “wilderness areas” to be preserved for future use and enjoyment.

The Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”). CERCLA generally imposes joint and several liability, without regard to fault or legality of conduct, on classes of persons who are considered to be responsible for the release of a “hazardous substance” into the environment. These persons include the current owner or operator of a contaminated facility, a former owner or operator of the facility at the time of contamination and those persons that disposed or arranged for the disposal of the hazardous substance. Under CERCLA and comparable state statutes, such persons may be subject to strict joint and several liability for the costs of cleaning up the hazardous substances that have been released into the environment, for damages to natural resources and for the costs of certain health studies. In addition, it is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment. Governmental agencies or third parties may seek to hold the Company responsible under CERCLA and comparable state statutes for all or part of the costs to clean up sites at which such “hazardous substances” have been released.

The Resource Conservation and Recovery Act (“RCRA”). RCRA was designed and implemented to regulate the disposal of solid and hazardous wastes. It restricts solid waste disposal practices and the management, reuse or recovery of solid wastes and imposes substantial additional requirements on the subcategory of solid wastes that are determined to be hazardous. Like the Clean Water Act, RCRA provides for citizens’ suits to enforce the provisions of the law.

National Historic Preservation Act.  The National Historic Preservation Act was designed and implemented to protect historic and cultural properties. Compliance with the Act is necessary where federal properties or federal actions are undertaken, such as mineral exploration on federal land, which may impact historic or traditional cultural properties, including native or Indian cultural sites.

Reclamation

We generally will be required to mitigate long-term environmental impacts by stabilizing, contouring, re-sloping and revegetating various portions of a site after mining and mineral processing operations are completed. These reclamation efforts would be conducted in accordance with detailed plans, which must be reviewed and approved by the appropriate regulatory agencies. As soon as we have a mining operation, we will be required to arrange and pledge certificates of deposits for reclamation with the state regulatory agencies. At this time no reclamation cost is required to be calculated or carried forward.

Employees

We currently have two full time employees as of our current fiscal year end June 30, 2021 and a full time contracted Chief Financial Officer; and is a director of the Company. In order to implement our business plan, we will be required to employ or retain qualified consultants with the technical expertise to evaluate and mine our mineral properties and for administrative duties as required. We initially planned to employ approximately ten to twelve miners upon commencing our initial mining operations in New Mexico in late 2019. Thereafter, we hired approximately thirteen and as of March 31, 2020, and until mid-November 2020, we had eight employees working in our mining operations in New Mexico. The reduction in employees is due to the continuing effects of COVID-19. In the last week of November 2020, we ceased mining operations due to three of our mining personnel becoming infected with the COVID-19 virus. The Company is currently utilizing two employees to maintain the mines and equipment until operations are anticipated to resume late in the third quarter of 2022.

Insurance

We maintain liability and workmen’s compensation insurance coverage to cover losses or risks incurred in the ordinary course of business.

Exploration

The Company has spent only nominal amounts during each of the last three fiscal years on exploration and activities associated with it.

Seasonality

We have no properties at this time that are subject to material restrictions on our operations due to seasonality.

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Office Facilities

Our principal executive offices are located at 2325 San Pedro NE, Suite 225, Albuquerque, NM 87110. Our telephone number is (505) 255-4852 and our mailing address is P.O. BOX 25201, Albuquerque, NM 87125-0201.

Dismissal of Bankruptcy Proceeding and Emergence from Voluntary Reorganization

In August 2015, the Company filed for Bankruptcy protection under Chapter 11 of the United States Bankruptcy Code in Delaware in order to secure the existing assets from creditor actions, Case No. 15-11761 (MFW). Notwithstanding the Company’s Bankruptcy, the management continued to search for options that would allow it to continue as a going concern.

After the dismissal from Bankruptcy, the Company had limited assets, yet 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 no assets and all of their commitments and debts 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 the inception of mine production at the Summit mine, with the funds held in trust distributed by an independent trustee to certain unsecured creditors. Following prior management’s failure to provide a plan of reorganization, the resulting significant transactions that occurred upon emergence from bankruptcy were as follows:

·The approximately $20 million of indebtedness outstanding on account of the Company’s senior notes and unsecured claims were reinstated; and 

·The Court established a trust in April 2016 for the benefit of certain creditors. A profit interest was attached to the Summit mine for the benefit of certain creditors holding unsecured claims filed by each creditor.  

The Company received Bankruptcy Court confirmation of the dismissal in June 2016, and subsequently emerged from bankruptcy. The only funds available for the future administrative costs were prepaid insurance funds of approximately $49,000. The Company subsequently began selling, on a best-efforts basis, equity for the cash needed for working capital purposes. Currently we have no continuing commitment from any party to provide working capital, and there is no certainty that the Company will be able to continue its current business plan. However, the mining claims / assets that it has managed to secure appear to present a significant opportunity for the Company to continue in the mining business.

At the end of the Company’s fiscal year ended June 30, 2019, the Company wrote off debt and related, accrued interest in the aggregate amount of $12,506,540. The write off of debt was related to two finance facilities that were outside of the British Columbia statutes of limitations.  Upon review, the Commission was concerned about the Company taking this write-down because FASB ASC 405-20-40-1(b) 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.” The Company and its auditors had secured legal opinions from two different law firms stating that the statute of limitations had run with respect to the aforementioned liabilities. However, without release of liability from the creditors or a court of competent jurisdiction, or in the alternative an opinion of counsel that met the requirements of what is sometimes referred to as a “would” or “will” opinion, the Commission Staff took the position that the correct treatment of the aforementioned liabilities was to continue carrying them on the Company’s balance sheets. In requiring a “will” or “would” opinion, the Commission is looking for greater assurance that the Company “would” or “will” be successful in the event that one of the creditors sought to collect on the liabilities. Although this standard may seem subjective, “will opinions” are used in the context of tax law where a tax opinion is needed.  In that context the term “will” means that the drafter of the opinion believes and is effectively stating that there is a 90%-95% probability that a given result “will” come to pass based on the facts present. The Company was not able to procure a judicial order in a timely manner, specific written agreement of the creditors nor an opinion of counsel meeting the “would” or “will” standard, therefore it determined the most expeditious course of action was to restate the consolidated financial statements so that the liabilities that were written-off are now included in the liabilities of the Company once again; in effect, restating the consolidated financial statements as of June 30, 2019. Since the impact these liabilities have on the Company’s consolidated financial statements continues to roll forward, this Registration Statement filed on Form 10 with the Commission also includes the audited consolidated financial statements for the fiscal year ended June 30, 2019, as restated to include the approximately $12 million in previously written-off liabilities; as well as the audited consolidated financial statements for the fiscal years ending June 30, 2020 (as Restated) and June 30, 2021 as well as the interim periods ending March 31, 2021 and March 31, 2022. Therefore, this Registration Statement was prepared using the Company’s consolidated financial statements which all have the approximately $12 million in liabilities that were previously written-off. If circumstances change in the future, such as the Company receiving a judicial determination stating that the aforementioned liabilities are not collectible or alternatively, if the Company is able to secure a “will” or “would” opinion from a law firm in British Columbia, Canada, the Company may revisit its ability to write down the aforementioned liabilities.

Item 1A. Risk Factors.

Our business involves a number of very significant risks, including but not limited to various areas of the mining exploration industry. The Company operates in a rapidly changing environment that involves numerous risks and uncertainties involving precious metal prices,

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explorations costs and government oversight. Our business, operating results and financial condition could be seriously harmed as a result of the occurrence of any of the following risks.

You should invest in our common stock only if you can afford to lose your entire investment. Your decision to invest in our common stock should only be made after you have knowingly accepted the possibilities of such a loss and the associated risks.

Risks Related to Our Business

All of our properties are in the exploration stage. There can be no assurance that we will establish the existence of any mineral resource or reserves on any of our properties. Until we can do so, we are not likely to earn any revenues from these properties, and our business could fail.

We have not established that any of our mining properties contain any mineral reserves; and as such, under Regulation S-K 1300 et. seq. (“Reg S-K 1300”), we are considered an “exploration stage company.” Under the new rules set forth in Reg S-K 1300, an individual property is defined as being: 1.) An exploration stage property if it has no mineral reserves disclosed; 2.) A development stage property if it has mineral reserves disclosed, but has no material extraction; and 3.) A production stage property if it has material extraction of mineral reserves. Our ability to conclude that an individual prospect has any viable mineral reserves requires further efforts and any funds that we spend on exploration may be lost. Even if we do eventually discover mineral reserves on one or more of our properties and they are considered “development stage” because we have not engaged in any material extraction, there can be no assurances that they will become production stage properties. Both mineral exploration and development involve a high degree of risk and few properties, which are explored become development properties; and even if they become eligible to be considered development stage properties, as defined in Reg. S-K 1300, there are no assurances that they will ultimately become production stage properties with commercially viable producing mines.

The commercial viability of an established mineral deposit will depend on a large number of factors; including, by way of example, the size, grade and other attributes of the mineral deposit, the proximity of the resource to infrastructure, roads and a point for shipping, government regulation and market prices. Most of these factors will be beyond our control, and any of them could increase costs and make extraction of any previously identified mineral resource unprofitable. Because of this, we will most likely be required to conduct a “feasibility study” by a qualified person or company in order to secure any financing for development, extraction and processing. Feasibility studies, themselves, are very time consuming and costly. There are no assurances that we will be able to fund a feasibility study or to find an investor or partner that will be willing to fund feasibility studies needed to progress to extraction. If we are unable to fund a feasibility study when needed, or if the results of a feasibility study do not suggest that a property will be commercially viable, any funds used on the property will have been lost.  

Even if commercial viability of a mineral or metal deposit is established, we may be required to expend significant resources until production is possible, during which time the economic feasibility of production may change. Substantial expenditures are required to both establish proven and probable reserves as well as those required to implement permitting and drilling operations. Because of these uncertainties, investors have no assurances that our drilling programs will result in commercially viable operations nor that we will be successful in the establishment or expansion of any resources or reserves. Any failure in our ability to successfully execute on the forgoing will adversely impact our business results of operations, in turn leading to losses for investors.

Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves, and the primary environmental analysis or report must be filed with the appropriate governmental authority. As the Company adopts the required disclosure prescribed in Regulation S-K 1300 et. seq., the concept of a feasibility study is the same; and although, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” were not defined terms under SEC Industry Guide 7 and were not permitted to be used in reports and registration statements filed with the SEC, Under Reg. S-K 1300 each of those terms is specifically defined and must be used as defined therein in describing mineral deposits in the required reports. Investors are cautioned not to assume that any part or all of potential mineral deposits will ever be converted into “mineral resources,” as the term under Reg. S-K 1300 means not only that there are mineral deposits present but that they have been determined to be economically viable for extraction. The mineral deposits on our properties have a great amount of uncertainty as to their existence, and great uncertainty as to their economic feasibility. Our properties currently do not contain any known proven or probable ore reserves under Reg. S-K 1300 reporting standards. Investors are cautioned not to assume that any identified mineral deposits will be determined to be mineral reserves or ever be converted into mineral resources as defined in Reg. S-K 1300 et. seq.

If we establish the existence of commercially viable mineral resources on any of our properties, we will require additional capital in order to develop the property into a producing mine. If we cannot raise this additional capital, we will not be able to exploit the resource, and our business could suffer.

If we do discover mineral resources on any of our properties, as defined under Reg. S-K 1300 meaning that such mineral deposit(s) is/are commercially viable, we will be required to expend substantial sums of money to establish the extent of the resource, engage in drilling operations and develop extraction and processing facilities (or effect acceptable shipping arrangements therefor) and infrastructure. We do not have adequate capital to develop necessary facilities and infrastructure and will need to raise additional funds. Although we may derive

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substantial benefits from the discovery of commercially exploitable deposits, there can be no assurance that such a mineral resource will be large enough to justify conventional commercial operations or that we will be able to raise the funds required for development and/or processing on a timely basis. If we cannot raise the necessary capital or complete the necessary facilities, infrastructure, development, processing or related activities, our business may fail and we may be forced to curtail or cease operations.

Our exploration and extraction activities may not be commercially successful. 

While we believe there are positive indicators that our properties contain commercially exploitable minerals and metals, such belief has been based solely on preliminary tests that we have conducted and data provided by third parties. There can be no assurance that the tests and data upon which we have relied are correct or accurate. Moreover, mineral exploration is highly speculative in nature, involves many risks and is frequently non-productive. Unusual or unexpected geologic formations and the inability to obtain suitable or adequate machinery, equipment or labor are risks involved in the conduct of most exploration programs. The success of mineral exploration and development is determined in part by the following factors:

rthe identification of potential mineralization based on analysis; 

rthe availability of permits; 

rthe quality of our management and our geological and technical expertise; and 

rthe capital available for mining operations. 

Substantial expenditures and time are required to establish existing proven and probable reserves through drilling and analysis, and to develop the mines and facilities and infrastructure at any site chosen for mining. Whether a mineral or metal deposit will be commercially viable and meet Reg. S-K 1300’s definition of “mineral resource”, depends on a number of factors, which include, without limitation: the particular attributes of the deposit, such as size, grade and proximity to infrastructure; metal prices, which fluctuate widely; and government regulations, including, without limitation, regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection; and general economic factors, which include, without limitation, market prices for certain minerals or metals, labor costs, the impact of technological innovations on the supply and demand for the commodities we mine. If our exploration and extraction activities are not successful, our business will likely fail.

There may be challenges to the title of our mineral properties.

The Company has acquired certain rights to its properties by unpatented claims, ownership of land or by lease from those owning the property and its patented claims are limited. The validity of title to many types of natural resource property depends upon numerous circumstances and factual matters (many of which are not discoverable of record or by other readily available means) and is subject to many uncertainties of existing law and its application. There can be no assurance that the validity of our titles to our properties will be upheld or that third parties will not otherwise seek to invalidate those rights. In the event the validity of our title to any of these properties are not upheld, such events would have a material adverse effect on us.

Mineral operations are subject to applicable law and government regulations. Even if we discover a mineral resource in a commercially exploitable quantity, these laws and regulations could restrict or prohibit the exploitation of them. If we cannot exploit any mineral resources that we discover on our properties, our business may fail.

Both mineral exploration and extraction require permits from various foreign, federal, state, provincial and local governmental authorities and are governed by laws and regulations, including those with respect to prospecting, mine development, mineral production, transport, export, taxation, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters.  

Companies, such as ours that plan to engage in exploration and extraction activities, often experience increased costs and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits. Issuance of permits for our activities is subject to the discretion of government authorities, and we may be unable to obtain or maintain such permits. Permits required for future exploration or development may not be obtainable on reasonable terms, on a timely basis or at all. There can be no assurance that we will be able to obtain or maintain any of the permits required for the continued exploration or development of our mineral properties or for the construction and operation of a mine on our properties at economically viable costs. If we cannot accomplish these objectives, our business could face difficulty and/or fail.

We believe that we are in compliance with all material laws and regulations that currently apply to our activities but there can be no assurance that we can continue to do so. Current laws and regulations could be amended and we might not be able to comply with them, as amended. Further, there can be no assurance that we will be able to obtain or maintain all permits necessary for our future operations, or that we will be able to obtain them on reasonable terms. To the extent such approvals are required and are not obtained, we may be delayed or prohibited from proceeding with planned exploration or development of our mineral properties.

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Environmental hazards unknown to us, which have been caused by previous or existing owners or operators of the properties, may exist on the properties in which we hold an interest. It is possible that our properties could be located on or near the site of a Federal Superfund cleanup project. Although we endeavor to avoid such sites, it is possible that environmental cleanup or other environmental restoration procedures could remain to be completed or mandated by law, causing unpredictable and unexpected liabilities to arise. We are not currently aware of any environmental issues or litigation relating to any of our current or former properties but if they were to arise, we could face significant liability that would negatively impact our operations that would cause our business to fail.

Competition in the mining industry is intense, and we have limited financial and personnel resources with which to compete. 

Competition in the mining industry for desirable properties, investment capital, equipment and personnel are intense. Numerous companies headquartered in the United States, Canada and elsewhere throughout the world compete for properties on a global basis, including areas where we intend to operate. We are currently an insignificant participant in the mining industry due, in part, to our limited financial and personnel resources. We may be unable to: i) attract the necessary investment capital or a joint venture partner to fully develop our mineral properties, ii) acquire other desirable properties, iii) attract and hire necessary personnel, or iv) purchase necessary equipment.

The nature of mineral exploration and production activities involves a high degree of risk and the possibility of uninsured losses. 

The business of exploring for and extracting minerals and metals involves a high degree of risk. Few properties are ultimately developed into producing mines. Whether a mineral deposit can be commercially viable depends upon a number of factors, including the particular attributes of the deposit, including size, grade and proximity to infrastructure, metal prices, which can be highly variable, and government regulation, including environmental and reclamation obligations. These factors are not within our control. Uncertainties as to the metallurgical amenability of any minerals discovered may not warrant the mining of these metals or minerals on the basis of available technology. Our operations are subject to all of the operating hazards and risks normally incident to exploring for and developing mineral or metal properties, such as, but not limited to:

rencountering unusual or unexpected formations; 

renvironmental pollution; 

rpersonal injury, flooding and landslides; 

rvariations in grades of minerals or metals; 

rlabor disputes; and 

ra decline in the price of gold or silver. 

We currently have no insurance or hedges to guard against any of these risks. If we determine that capitalized costs associated with any of our mineral interests are not likely to be recovered, we would incur a write-down on our investment in such property interests. All of these factors may result in losses in relation to amounts spent which are not recoverable. The payment of any liabilities that arise from any such occurrence would have a material, adverse impact on our Company.

Our exploration and development activities are subject to environmental risks, which could expose us to significant liability and delay, suspension or termination of our operations. 

The exploration, possible future development and production phases of our business will be subject to federal, state and local environmental regulation. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set out limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments, and a heightened degree of responsibility for companies and their officers, directors and employees. Future changes in environmental regulations, if any, may adversely affect our operations. If we fail to comply with any of the applicable environmental laws, regulations or permit requirements, we could face regulatory or judicial sanctions. Penalties imposed by either the courts or administrative bodies could delay or stop our operations or require a considerable capital expenditure. Although we intend to comply with all environmental laws and permitting obligations in conducting our business, there is always a possibility that those opposed to exploration and mining may attempt to interfere with our operations, whether by legal process, regulatory process or otherwise.

We could be subject to environmental lawsuits.  

Neighboring landowners, other third parties and governmental entities could file claims based on environmental statutes and common law for personal injury and property damage allegedly caused by the release of hazardous substances or other waste material into the environment on or around our properties. There can be no assurance that our defense of such claims will be successful. A successful claim against us could have an adverse effect on our business prospects, financial condition and results of operation.

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The Company’s industry is highly competitive and we have less capital and resources than many of our competitors which may give them an advantage in developing and securing mining claims and marketing products similar to ours or make our products obsolete:

We are involved in a highly competitive industry where we may compete with numerous other companies who offer alternative methods or approaches. These competitors may have far greater resources, more experience, and personnel perhaps more qualified than we do. Such resources may give our competitors an advantage in developing and marketing products similar to ours or products that make our products obsolete. There can be no assurance that we will be able to successfully compete against these other entities.

The Company’s failure to continue to attract, train, or retain highly qualified personnel could harm the Company’s business:

The Company’s success also depends on the Company’s ability to attract, train, and retain qualified personnel, specifically those with management and product development skills. In particular, the Company must hire additional skilled personnel to further the Company’s research and development efforts. Competition for such personnel is intense. If the Company does not succeed in attracting new personnel or retaining and motivating the Company’s current personnel, the Company’s business could be harmed. 

Risks Related to the Company

Litigation with respect to Mr. Laws may not result in additional funds being obtained to reduce his indebtedness owed to the Company.

The Company has determined by its records that Mr. Laws initially owes us $1,197,198, excluding related professional fees, forensic accounting costs and interest and penalties associated with the indebtedness. As of the filing of this Form 10, after deducting cash collections of $809,534 from Laws and related litigation and properties held for sale of $$209,800, Laws owes the Company $177,864 (the “Missing Funds”) plus penalties, professional fees and accrued interest. The Company has been awarded from litigation and collection efforts, the foreclosure on pledged assets and received these assets free and clear of any liens and the funds from the sale of the pledged residence by the court, which the net proceeds were received on March 31, 2021.  

Mr. Laws filed a petition for protection under the U.S. Bankruptcy Code and has sought to use that proceeding to challenge the Company’s rights to foreclose on certain property that was pledged as security in connection with a promissory note he provided to the Company. That promissory note was issued by Mr. Laws when it was discovered that he owed the Company and payment of the amount he owed the Company was demanded. Mr. Laws’ challenge to the Company’s security interest was not supported by the court. Nevertheless, there can be no assurances that the Company will be able to collect a material amount of the remaining Missing Funds from Mr. Laws. Failure to collect the balance of funds from Mr. Laws will adversely impact the Company’s financial condition, including the impact from loss of the funds themselves, although that adverse effect has already been realized and the Company has been operating without the balance of the Missing Funds since they were absent in 2017. As a result of Mr. Laws’ actions, the Company had the additional expenses associated with restating its financial statements. There were also expenses associated with engaging the special committee to conduct a forensic review of the Company’s books and records in connection with the transactions giving rise to the Missing Funds. Additionally, the Company incurred costs associated with engaging counsel to represent the Company in this matter and in the investigations as well as the court proceedings. That is, the investigation(s) or “pre-investigation(s)” that have been conducted or may be conducted by the SEC and DOJ; as well as the costs to settle any matters related thereto, may be significant. The Missing Funds together with the additional expenses that have arisen as a result of Mr. Laws’ actions in the aggregate are substantial and have been expensed as incurred. Notwithstanding the forgoing, the Company believes that the aforementioned investigation(s) by the SEC and DOJ have been completed and therefore it does not expect that there will be any further action by either agency.

The DOJ and the SEC investigated the Company, including financial transactions involving Thomas Laws.

The U.S. Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) have each completed investigation into the Company, its officers, directors, and potentially others, resulting from the Laws transactions. The SEC has obtained a formal order to investigate the Company with respect to Laws, and while we understand that the DOJ investigation led to Mr. Laws plea of guilty to various charges, including charges based on his actions alleged by the Company. 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 does not anticipate collecting a material amount due from Mr. Laws in his criminal proceedings. However, we believe that if it is ultimately successfully in recovering any further sums from Mr. Laws, beyond what it has already recovered, that any additional recovery will be determined by the U.S. Bankruptcy Court. While the Company believes that the SEC and DOJ investigations have been completed and does not expect any further action against the Company or its officers and/or directors, if we are incorrect in this belief, the Company would incur substantial expenses in defending or settling any additional matters.

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The SEC investigation surrounding the financial transactions involving Thomas Laws may result in other officers, directors or third-parties or the Company being subject to related or different enforcement actions.

None of funds that Mr. Laws owes the Company were ever received by anyone other than Mr. Laws, nor was there ever any evidence found (after a forensic review of the Company’s books and records by an independent forensic accounting firm that anyone else benefited in any way from the Laws transaction(s). However, notwithstanding the forgoing, the SEC investigated this matter, and the SEC found that the conduct of one of our officers made in connection with the Laws matter to be actionable. Rather that litigate the matter, the officer settled the matter. This settlement involved the officer being prohibited from serving as an officer or director of the Company and payment of a fine. Although we do not believe that any other officers or directors are the subject of any further SEC investigations, if we are incorrect and there were others that are subject to further SEC investigation(s), this would have an adverse impact on the Company and its operations. Such investigations are, by their nature, costly in terms of time and attention being taken away from the Company and its operations as well as the substantial cost in legal fees incurred in defending and/or settling any claims that might be made. In addition, such actions often involve fines, which would have an adverse impact on the Company and its operations.  

The SEC could take the position that we have paid impermissible finders’ fees.

In the past, we paid finders’ fees in connection with the placement of certain shares of our common stock to an individual who is a non-U.S. resident. While the Company is confident that it met the factors set forth in the SEC Paul Anka No Action Letter (Issued July 24, 1991) (the seminal No Action Letter where transaction-based compensation for finders has been approved by the Commission), by definition, the facts set forth in the aforementioned No Action Letter vary from those facts in all other situations including those that were present when finder’s fees were paid by the Company. As such, the SEC is not compelled to find the letter applicable in other situations and with other fact patterns. Nevertheless, we believe that the facts in the Company’s case are actually more compelling than those set forth in the Anka letter. The issuer in the Anka Letter did not have a pre-existing relationship with investors, whereas the Company not only had a pre-existing relationship with investors, the investors were almost entirely existing shareholders of the Company. Although, (a) the finder did not have involvement in negotiating or structuring transactions with investors (the Company’s investors had already determined to purchase, no sales material was provided by the finder with the sole exception of a blank subscription agreement that the finder was provided by the Company along with the offering price as a courtesy); (b) the finder did not value or opine as to the Company’s common stock’s value and did not participate in negotiating on behalf of the investor or the Company; (c) the finder was not in the business of brokering transactions and its activity, as a finder, was isolated to helping the Company and again, (d) although fees were paid in connection with the sales of the Company’s common stock, this was disclosed on the subscription agreements and the other items were as limited or more limited than those that were present giving rise to the SEC’s Paul Anka No-Action Letter. Further out of an abundance of caution, no commissions or finder’s fees have been paid in connection with the placement of common stock subsequent to August 2018. Nevertheless, if the SEC were to disagree with the Company’s analysis, the Company would be in a position where it would be required to defend its position or to reach a settlement with the Commission, either of which could be costly and have a negative impact on the Company and its results of operations.

There can be no assurance the Company will successfully implement its plans.

We have historically incurred net losses from operations and we expect losses in the future periods. Our likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the formation of a new business which seeks to obtain funds to finance its operations in a highly competitive environment. There can be no assurance that we will successfully implement any of our plans (including without limitation production of any mine, shipping ore to a smelter or otherwise commercially exploit our properties) in a timely or effective manner or that we will ever be profitable. In addition, there can be no assurances that we will choose to continue to develop any of our current properties because we intend to consider and, as appropriate, to divest ourselves of properties that may no longer be a strategic fit to our business strategy or that we lack the necessary capital to develop. If we lack the capital to implement our plans, we will be forced to curtail or cease operations.

Mineral exploration and development inherently involve significant and irreducible financial risks. We may suffer from the failure to find and develop profitable mineral deposits.

The exploration for and development of mineral deposits involves significant financial risks, which even a combination of careful evaluation, experience and knowledge may not eliminate. Unprofitable efforts may result from the failure to discover mineral deposits. Even if mineral deposits are found, such deposits may be insufficient in quantity and quality to return a profit from production, or it may take a number of years until production is possible, during which time the economic viability of the project may change. Few properties which are explored are ultimately developed into producing mines. Mining companies rely on consultants and others for exploration, development, construction and operating expertise.

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Substantial expenditures are required to establish ore reserves, extract metals from ores and, in the case of new properties, to construct mining and processing facilities. The economic feasibility of any development project is based upon, among other things, estimates of the size and grade of ore reserves, proximity to infrastructures and other resources (such as water and power), metallurgical recoveries, production rates and capital and operating costs of such development projects, and metals prices. Development projects are also subject to the completion of favorable feasibility studies, issuance and maintenance of necessary permits and receipt of adequate financing.

Once a mineral deposit is developed, whether it will be commercially viable depends on a number of factors, including: the particular attributes of the deposit, such as size, grade and proximity to infrastructure; government regulations including taxes, royalties and land tenure; land use, importing and exporting of minerals and environmental protection; and mineral prices. Factors that affect adequacy of infrastructure include: reliability of roads, bridges, power sources and water supply; unusual or infrequent weather phenomena; sabotage; and government or other interference in the maintenance or provision of such infrastructure. All of these factors are highly cyclical. The exact effect of these factors cannot be accurately predicted, but the combination may result in not receiving an adequate return on invested capital.

Significant investment risks and operational costs are associated with our exploration activities. These risks and costs may result in lower economic returns and may adversely affect our business.

Mineral exploration, particularly for gold, involves many risks and is frequently unproductive. If mineralization is discovered, it may take a number of years until production is possible, during which time the economic viability of the project may change. Development projects may have no operating history upon which to base estimates of future operating costs and capital requirements. Development project items such as estimates of reserves, metal recoveries and cash operating costs are to a large extent based upon the interpretation of geologic data, obtained from a limited number of drill holes and other sampling techniques, and feasibility studies. Estimates of cash operating costs are then derived based upon anticipated tonnage and grades of ore to be mined and processed, the configuration of the ore body, expected recovery rates of metals from the ore, comparable facility and equipment costs, anticipated climate conditions and other factors. As a result, actual cash operating costs and economic returns of any and all development projects may materially differ from the costs and returns estimated, and accordingly, our financial condition and results of operations may be negatively affected.

Any of our future acquisitions may result in significant risks, which may adversely affect our business.

An important element of our business strategy is the opportunistic acquisition of operating mines, properties and businesses or interests therein within our geographical area of interest. While it is our practice to engage independent mining consultants to assist in evaluating and making acquisitions, any mining properties or interests therein we may acquire may not be developed profitably or, if profitable when acquired, that profitability might not be sustained. In connection with any future acquisitions, we may incur indebtedness or issue equity securities, resulting in increased interest expense, or dilution of the percentage ownership of existing shareholders. We cannot predict the impact of future acquisitions on the price of our business or our common stock. Unprofitable acquisitions, or additional indebtedness or issuances of securities in connection with such acquisitions, may impact the price of our common stock and negatively affect our results of operations.

Our ability to find and acquire new mineral properties is uncertain. Accordingly, our prospects are uncertain for the future growth of our business.

Because mines have limited lives based on proven and probable ore reserves, we may seek to replace and expand our future ore reserves, if any. Identifying promising mining properties is difficult and speculative. Furthermore, we encounter strong competition from other mining companies in connection with the acquisition of properties producing or capable of producing gold. Many of these companies have greater financial resources than we do. Consequently, we may be unable to replace and expand future ore reserves through the acquisition of new mining properties or interests therein on terms we consider acceptable. As a result, our future revenues from the sale of gold or other precious metals, if any, may decline, resulting in lower income and reduced growth.

Delaware law and our by-laws protect our directors from certain types of lawsuits.

Delaware law provides that our directors will not be liable to us or our stockholders for monetary damages except for certain types of conduct as directors. Our by-laws require us to indemnify our directors and officers against all damages incurred in connection with our business to the fullest extent provided or allowed by law. The exculpation provisions may have the effect of preventing stockholders from recovering damages against our directors caused by their negligence, poor judgment, or other circumstances. The indemnification provisions may require us to use our assets to defend our directors and officers against claims, including claims arising out of their negligence, poor judgment, or other circumstances.

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Even if the Ore Contains a Substantial amount of Gold or Silver it May Not be Profitable Because of Other Factors.

The Company is in the preliminary stages of mining operations in the Jim Crow and Billali Mines. There can be no assurances of continued mining operations at the Jim Crow and Billali Mines or that continued operations will be profitable. The Company currently does not have a long-term smelting contract and there can be no assurances that shipping to a smelter will occur in the immediate or near future. Transportation of head ore is expensive and the smelter the Company previously used is no longer accepting ore from outside sources. This has forced the Company to advance its plans to construct a mill on our site in Duncan, Arizona. This will enable us to process our ore into concentrate, which is more efficient to transport cost wise to the smelter. Without the ability to process the head ore into concentrate, the transportation of the head ore is cost prohibitive. Thus, it is imperative that the Company construct a mill to process its ore on a site that is in close proximity to our mine sites. Any delays in securing the financing necessary to construct the required mill and/or any delays in constructing it will negatively impact the Company’s mining operations and results of operations. The Company is seeking financing to construct the mill but there can be no assurances that it will be successful in securing the necessary financing or that if it is able to secure financing that it will be on terms that are favorable to the Company. Any delays or problems in raising the funds required for a mill will adversely impact the Company and its operations which ultimately adversely impacts investors.  

Dismissal of Bankruptcy Proceedings and Emergence from Voluntary Reorganization did not result in the elimination of Company liabilities.

After the dismissal of the bankruptcy petition in June 2016 and the sale of the Company’s significant assets, the Company emerged with limited assets while it 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 no assets and all of their commitments and debts remain outstanding.  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 the inception of mine production at the Summit mine and the trust funds will be distributed to certain unsecured creditors by an independent trustee. The Company failed to provide a plan of reorganization with the filing for protection under the Bankruptcy Code and as such, its debts were not discharged. The significant transactions that occurred upon emergence from bankruptcy were as follows:

·The approximately $20 million of indebtedness outstanding on account of the Company’s senior notes and unsecured claims were reinstated; and 

·The courts established a trust in April 2016 for the benefit of certain creditors. A profit interest was attached to the Summit mine with the benefit for certain creditors holding unsecured claims filed by each creditor.  

Accordingly, there can be no assurance that the Company’s remaining liabilities, after the emergence from bankruptcy, will not materially impact the Company.  The Company has no continuing commitment from any party to provide working capital, and there is no certainty that the Company will be able to raise sufficient capital to fund any or all existing liabilities as well as to fund its current business plan.  The failure to raise needed capital may result in the curtailment or cessation of our business.

We have a history of operating losses and expect to incur substantial operating losses and negative operating cash flows for the foreseeable future, and we may never achieve or maintain profitability.

We have had no revenues during the last three fiscal years, will not generate revenues this current fiscal year, and we are not currently profitable. We do not currently have sufficient capital to fund operations through June 30, 2022 and will need to raise additional funding to implement our business strategy. Even if we succeed in developing any of our properties and the mill site, we may incur operating losses for the foreseeable future and may never become profitable. We also expect to continue to incur significant operating and capital expenditures and anticipate that our expenses will increase substantially in the foreseeable future. As the Company has no commitment for debt or equity financing, the Company will be reliant upon best-efforts fund-raising activities to provide sufficient working capital to fund current and future needs. There can be no assurance that the Company will be successful in its best-efforts capital raising efforts, and the failure to raise needed capital will result in the curtailment or cessation of our business.

We may never be able to write-down certain liabilities and this may have a negative impact on our ability to raise capital and on the market price of our common stock, when we resume trading (of which there can be no assurance.

At the end of the Company’s fiscal year ending June 30, 2019, the Company wrote off debt and related accrued interest aggregating $12,507,540. The write off of debt was related to two finance facilities governed by and enforceable under British Columbia statutes. The Company retained legal services in British Columbia to research the British Columbia statutes of limitations on the collectability of the finance facilities. Legal counsel reviewed all related documents, records of proceedings and all records and documents deemed relevant to the two finance facilities. The finance facilities were subject to the laws of the Providence of British Columbia and the National laws of Canada and as a result, the Company secured a written legal opinion from Canadian counsel that any liability under the two finance facilities, because of the Limitations Act (British Columbia) and the relevant case law in British Columbia, were no longer enforceable. That is, because the statute of limitations had run for the two liabilities, pursuant to the Limitations Act (British Columbia), no future claims could be commenced in the Province of British Columbia and therefore, the Company had no outstanding legal obligations on the two finance

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facilities. With this, the Company wrote down $12,507,540 in liabilities and this has been the Company’s position; however, upon review of earlier Registration Statements that were subsequently withdrawn, the SEC Staff expressed its concern with the Company taking this write-down because FASB ASC 405-20-40-1(b) 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.” Since management knew that one of the creditors had been dissolved and was no longer in existence and the other creditor had written-off the amounts that had been owed to it by the Company in one of its annual reports, it knew that it would be difficult if not impossible to get both creditors to release it from liability and that obtaining a court order would be time consuming and expensive at best. The Commission Staff was willing to allow an opinion of counsel, however the opinions we provided did not meet the standard that the Commission requires. The standard that the Commission Staff requires is what is sometimes referred to as a “would” or “will” opinion. In requiring a “will” or “would” opinion, the Commission is looking for greater assurance that the Company “would” or “will” be successful in the event that one of the creditors sought to collect on the liabilities. Although this standard may seem subjective, “will opinions” are regularly used in the context of tax law where a tax opinion is needed.  In that context the term “will” means that the drafter of the opinion believes and is effectively stating that there is a 90%-95% probability that a given result “will” come to pass based on the facts present. Absent the availability of one of these three routes to write-off the liabilities, he Commission Staff’s position is that the correct treatment of the aforementioned liabilities is to continue carrying them on the Company’s balance sheets. The Company was not able to procure a judicial order in a timely manner, specific written agreement of the creditors nor an opinion of counsel meeting the “would” or “will” standard, therefore it determined the most expeditious course of action was to restate the consolidated financial statements so that the liabilities that were written-off are now included in the liabilities of the Company once again; in effect, restating the consolidated financial statements as of June 30, 2019. Although, in a future period, while the Company plans to either seek a judicial determination or an opinion of counsel that meets the “would” or “will” standard with respect to the liabilities, there can be no assurance that the Company will be successful in meeting the requirements necessary to write-off the aforementioned liabilities or that the Commission will agree that the judicial determination or opinion of counsel satisfies the requirements and spirit of FASB ASC 405-20-40-1(b) and seek to have us restate them (like is being done on this Registration Statement filed on Form 10). In that event, the Company would have taken a one-time gain on the discharge of indebtedness but would, presumably in a later period, be required to restate its consolidated financial statements and it would have a negative impact on the Company’s results of operations. Although, such a restatement wouldn’t necessarily have an actual negative impact on the Company, the market participants could view it differently and as a result, our stock prices as well as our ability to secure necessary funding could be harmed as a result.

We have a limited operating history on which to base an evaluation of our business and properties.

Any investment in the Company’s securities should be considered a high-risk investment because investors will be placing funds at risk in an early-stage business with unforeseen costs, expenses, competition, a history of operating losses and other problems, to which start-up ventures are often subject. Investors should not invest in the Company’s securities unless they can afford to lose their entire investment.  Your investment must be considered in light of the risks, expenses, and difficulties encountered in establishing a new business in a highly competitive and mature industry. Our operating history does not provide a meaningful basis for an evaluation of our current prospects.  Other than through conventional and typical exploration methods and procedures, we have no additional way to evaluate the likelihood of whether other properties contain commercial quantities of mineral or metal reserves or, if they do, if they will be operated successfully.

Management of growth may be necessary for us to be competitive.

Successful expansion of our business will depend on our ability to effectively attract and manage staff, strategic business relationships, and shareholders. Specifically, we will need to hire skilled management and technical personnel as well as manage partnerships and joint ventures to navigate shifts in the general economic environment. Expansion has the potential to place significant strains on financial, management, and operational resources, yet failure to expand will inhibit our profitability goals.

If we cannot secure additional funding, we will be unable to implement our business plan.

Since we do not generate any revenues, we may not have sufficient financial resources ourselves, to undertake all planned development activities relating to our business plan. As stated, the smelter the Company previously used is no longer accepting ore from outside sources and this has forced the Company to advance its plans to construct a mill on site so that the ore can be processed into concentrate. Without the ability to process the head ore into concentrate, the transportation of the head ore is cost prohibitive. Thus, unless the smelter we had used previously begins accepting outside ore for processing, it is imperative that the Company construct a mill to process its ore. The Company had planned on constructing a mill in the future but this development with our previous smelter has forced the Company to plan and start construction immediately in order for it to realize any revenue from the ore it mines. The Company currently does not have the financial resources to construct the mill, therefore until it is able to secure the necessary financing, its prospects for generating revenue from the Jim Crow and Billali Mines is non-existent. Notwithstanding the forgoing, the Company has been successful in pursuing its claims against our former CEO, Thomas Laws and the funds that we are in the process of recovering will represent a substantial portion of the estimated cost of the mill’s construction. Nevertheless, there can be no assurances that additional financing will be available to us or that if available, that it would be on terms acceptable to us. We do not have any commitments for debt or equity financing at this time, nor do we have credit facilities available with financial institutions or other third parties, and investors may lose their all of their investment if we are unable to secure such financing in a timely manner. As the Company has no commitment for debt or equity financing, the Company will be reliant upon its own best-efforts fund-raising activities to provide sufficient working capital to fund its current and future needs, as well as on the

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potential cash flow from operations. There can be no assurances that the Company will be successful in its best-efforts capital raising or receive significant cash flow from operations; and the failure to generate needed working capital may result in the curtailment or cessation of its business, and losses for investors.

Our resources may not be sufficient to manage our expected growth; failure to properly manage our potential growth would be detrimental to our business.

Even if we obtain funding for operations, we may fail to adequately manage our anticipated future growth. Any growth in our operations will place a significant strain on our administrative, financial and operational resources, and increase demands on our management, as well as our operational and administrative systems, controls and other resources. There can be no assurances that our existing personnel, systems, procedures or controls will be adequate to support our operations in the future; or that we will be able to successfully implement appropriate measures consistent with our growth strategy. As part of this growth, we may have to implement new operational and financial systems, procedures and controls to expand, train and manage our employee base, and maintain close coordination among our staff. There can be no guarantee that we will be able to do so, or that if we are able to do so, we will be able to effectively integrate them into our existing staff and systems.

If we are unable to manage growth effectively, our business, operating results and financial condition could be materially adversely affected. As with all expanding businesses, the potential exists that growth will occur rapidly. If we are unable to effectively manage this growth, our business and operating results could suffer. Anticipated growth in future operations may place a significant strain on management systems and resources. In addition, the integration of new personnel will continue to result in some disruption to ongoing operations. The ability to effectively manage growth in a rapidly evolving market requires effective planning and management processes. We will need to continue to improve operational, financial and managerial controls, reporting systems and procedures, and will need to continue to expand, train and manage our work force.

The loss of key personnel could adversely impact the Company.

The nature of our business, including our ability to continue our current activities depends, in large part, on the efforts of our key personnel, the loss of any of which could have a material adverse effect on our business. As previously mentioned, the SEC instituted a formal investigation against our former CEO and if it were to continue to seek enforcement action(s) against other individuals that are important to the Company, we could effectively lose the services of those individuals. We state this because frequently with enforcement actions, the SEC seeks to bar individuals from serving as officers or directors or otherwise participating in certain activities for or on behalf of public companies, often five years and occasionally on a permanent basis. When the SEC seeks a “bar” against an individual, consent to a bar is generally one of the required terms of settlement insisted upon by the Commission. Our former CFO, was required to consent to such a 5-year bar from serving as an officer or director of the Company as one of the terms of settlement with the Commission.

We may be unable to continue as a going concern.

As a result of our financial condition, our auditors have expressed doubt as to our ability to continue as a going concern which may have an adverse impact on our relationship with third parties with whom we do business, and could make it challenging and difficult for us to raise additional debt or equity financing, all of which could have a material adverse impact on our business, results of operations, financial condition and future prospects. The consolidated 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.

A substantial or extended decline in gold and silver prices would have a material adverse effect on the value of our assets, on our ability to raise capital and could result in lower than estimated economic returns.

The value of our assets, our ability to raise capital and any future economic returns are substantially dependent on the prices of gold and silver. Gold and silver prices fluctuate daily and are affected by numerous factors beyond our control. Factors tending to influence gold prices, for example, include:

rgold sales or leasing by governments and central banks or changes in their monetary policy, including gold inventory management and reallocation of reserves; 

rspeculative short positions taken by significant investors or traders in gold; 

rthe relative strength of the U.S. dollar; 

rexpectations of the future rate of inflation; 

rinterest rates; 

rchanges to economic activity in the United States, China, India and other industrialized or developing countries; 

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rgeopolitical conflicts; 

rchanges in industrial, jewelry or investment demand; 

rchanges in supply from production, disinvestment and scrap; and 

rforward sales by producers in hedging or similar transactions. 

Risks Related to our Common Stock

Our common stock is not currently traded, and there is no guarantee that our stock will be tradable or that if it is as to the prices at which the shares may trade. 

Trading of our common stock recently was most recently quoted by OTC Markets Group, Inc., under the ticker symbol “SFEG.” Since the Company was not current in its filings with the U.S. Securities and Exchange Commission (the “SEC” or “Commission”), the Company it had a “skull and cross bones” associated with its trading symbol (the symbol used by OTC Markets meaning “Caveat Emptor” or buyer beware) but trading was suspended indefinitely when the SEC approved the Company’s settlement agreement which culminated in the deregistration of its common stock following the proceedings instituted by the Commission under Section 12j. In July 2020 we received notice that on June 25, 2020, the Commission had issued an order suspending trading under Section 12(k) of the Securities Exchange Act of 1934, as amended (the “Exchange Act.”). Thereafter, the Commission commenced administrative proceedings to de-register the Company’s common stock under Section 12(j) of the Exchange Act. Issuers of securities registered pursuant to Section 12 of the Exchange Act are required under Section 13(a) of the Exchange Act and the rules promulgated thereunder to file current and accurate information in periodic reports with the Commission. Specifically, Exchange Act Rule 13a-1 requires issuers to file annual reports, and Exchange Act Rule 13a-13 requires domestic issuers to file quarterly reports. The Company’s inability to prepare and file the required quarterly and annual reports began with the misappropriation of funds by its former CEO; this had a direct impact on its financial statements as originally filed.  This not only resulted in the need to amend and restate the 2017 annual report and  related quarterly reports that had been filed with the Commission on Form 10-K and on Forms 10-Q, but since a restatement necessarily has a material effect on all future reports, the Company was not in a position to confidently restate its financial statements until it was able to fully and accurately define scope of the issues created by Mr. Laws and determine what subsequent actions would be taken against him by the Company and other unrelated parties. Compounding the issue, the Company’s auditor declined to continue auditing the Company’s financial statements and the Company initially had difficulty engaging a replacement audit firm, in part because of the perception of risk and concerns about the scrutiny associated with ongoing investigations by the Commission and the DOJ.  Notwithstanding the forgoing, although there is not a way to conclusively determine that such investigations have reached their conclusions, the Company believes that it is unlikely any further action will be taken by the Commission or the DOJ.

Ultimately, while the underlying circumstances that gave rise to the Company’s delinquent filings were, in part, caused by an individual who was dismissed upon discovery of his misappropriation of funds, the difficulty in finding a replacement audit firm was an additional factor that was beyond the control of management and that factor contributed materially to the delays in our filings. Although we have since filed the annual and quarterly reports that were delinquent, one of which required restating our financials, the Commission’s standard position has been that, once de-registration proceedings are commenced for failure to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder, it will not then grant a right to cure or comply. thus, when the Commission commenced administrative proceedings under Section 12(j), our only options were to defend the matter in litigation or to settle it and agree with the Commission’s order for de-registration of securities registered under Section 12of the Exchange Act. Therefore, given: (a) the protracted nature of litigation in general, and (b) the high expense associated with defending an adversary proceeding with the Commission and (c) the low probability of a successful outcome, compared with the fact that: (x) a settlement with the SEC would allow the Company to re-file a registration statement as soon as it was drafted, (y) the Company had already prepared the required audits and was in a position to file a registration statement on Form 10, and (z) Form 10 Registration Statements are automatically effective 60 days from the date of filing (unless the Commission objects, which is rarely done), and after considering the forgoing, the Company determined that it was in the best interest of its shareholders to settle and consent to the de-registration of its common stock and to file this Form 10 Registration Statement.  On December 17, 2020, the SEC order suspending trading went into effect and OTC Markets ceased quoting our shares on its “expert market.” Following the filing of this Form 10, the Company will seek to secure a sponsor broker-dealer to file a new/updated Form 15c-211 with FINRA. As previously stated, there can be no assurances that the Company will be successful in finding a market maker to agree to sponsor its Form 15c-211 or that if it is successful, that it will be able to satisfy FINRA’s requirements to receive approval in a timely manner or at all. If the Company is not successful in finding a market maker sponsor, if the process continues without any sign of a successful conclusion or if the Company is unable to satisfy FINRA’s requirements, the Company’s common stock will not be tradable and bids and offers will not be quoted by any market makers so the Company would effectively be a reporting private company and its shareholders would not have a market in which to sell their shares. This in turn would negatively affect the Company’s ability to secure the funding required for it to execute on its business plan, which would negatively affect its operations and could result in a complete loss to investors.

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Even if we are successful in having our Form 10 become effective, with all comments cleared and we are able to successfully have our Form 15c-211 updated by a qualified market maker, trading may still be limited or suffer because we are not listed on an established securities exchange.

While we are in the process of filing this registration statement on Form 10 with the Commission and finding a market maker to sponsor the filing of our Form 15c-211 with FINRA, management views this as a short-term issue as of the date of the initial filing of this registration statement. Additionally, even if we are able to resume trading through the quotations on OTC Markets, not being listed for trading on an established securities exchange has an adverse effect on the liquidity of our common stock, not only in terms of the number of shares that can be bought and sold at a given price, but also through delays in the timing of transactions, number of market makers and lack of security analysts’ research coverage of the Company. This may result in systemically lower prices for your common stock than might otherwise be obtained if the Company had been listed on the NYSE or NASDAQ exchanges and could also result in a larger spread between the bid and ask prices that are quoted for our common stock.  Historically, our common stock has been thinly traded, and there is no guarantee of the prices at which the shares will trade, or that there will be sufficient volume to allow stockholders to sell their shares without having an adverse effect on market prices.  

Because our common stock is currently a “penny stock,” it may be difficult to sell shares at times and prices that are acceptable. 

Assuming we are successful in having our stock resume trading on OTC Markets, our common stock will be considered a “penny stock.” Broker-dealers who sell penny stocks must provide purchasers of these stocks with a standardized risk disclosure document prepared by the SEC. This document provides information about penny stocks and the nature and level of risks involved in investing in the penny stock market. A broker must also give a purchaser, orally or in writing, bid and offer quotations and information regarding broker and salesperson compensation, make a written determination that the penny stock is a suitable investment for the purchaser, and obtain the purchaser’s written agreement to the purchase. Assuming a market maker is allowed to provide bid and offer quotations because we have been successful in securing one to successfully sponsor our Form 211 with FINRA and we are able to satisfy FINRA’s requirements, of which there can be no assurances, we will continue to be considered a “penny stock.” The penny stock rules may make it difficult for you to sell your shares of our common stock. Because of these rules, many brokers choose not to participate in penny stock transactions and there is less trading in penny stocks overall as a result. Accordingly, you may not always be able to resell shares of our common stock in ordinary transactions at times and prices that you feel are appropriate.

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, this Form 10. Unfortunately, one of the additional consequences of having our common stock deregistered is that we are required to have a market maker sponsor and submit an updated/new Form 15c-211. 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 this Form 10.  We have selected 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 have selected 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.  

If we are successful, it our efforts to have our stock resume trading, the sale of it by existing stockholders may depress its price due to the limited trading market that would likely exist.

Any sales of a significant amount of common stock by existing shareholders may depress the price otherwise causing the price of our common stock may decline.

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A small number of existing shareholders own a significant portion of our common stock, which could limit your ability to influence the outcome of any shareholder vote.

A relatively small number of shareholders hold large concentrations of shares and under our certificate of incorporation and Delaware law, the vote of a majority of the shares outstanding is generally required to approve most shareholder actions. As a result, these individuals and entities will be able to influence the outcome of shareholder votes for the foreseeable future, including votes concerning the election of directors, amendments to our certificate of incorporation or proposed mergers or other significant corporate transactions.    

If the Company is successful in its efforts to have its common stock resume trading, the Company’s stock price and volume is likely to be highly volatile, limited and sporadic.

The market price of our common stock fluctuated historically and if the Company is successful in its efforts to have it resume trading is likely to continue to fluctuate in the future. These fluctuations may be exaggerated since the trading volume would likely be volatile, limited, and sporadic. These fluctuations may or may not be based upon any business or operating results. Our common stock may experience similar or even more dramatic price and volume fluctuations in the future, if our efforts are successful and its trading resumes.

The Company will not pay dividends on its common stock.

We have never paid any cash dividends on any shares of our capital stock, and we do not anticipate that we will pay any dividends in the foreseeable future. Our current business plan is to retain any future earnings to finance the expansion of our business. Any future determination to pay cash dividends will be at the discretion of our Board of Directors, and will be dependent upon our financial condition, results of operations, capital requirements and other factors as our board of directors may deem relevant at that time. If we do not pay cash dividends, our stock may be less valuable because a return on your investment will only occur if our stock price appreciates.

If trading in our common stock is allowed to resume, any outstanding shares that are eligible for future sale could adversely impact a public trading market for our common stock.

We have offered and sold and will continue to offer and sell shares without registration under the Securities Act, through exemptions available under the Securities Act. All such shares are "restricted securities" as defined by Rule 144 ("Rule 144") when issued under available exemptions from registration under the Securities Act, and cannot be resold without registration except in reliance on Rule 144 or another applicable exemption from registration. In general, under Rule 144, our non-affiliates (who have not been affiliates within the past 90 days) can sell restricted shares held for at least six months, subject only to the requirement that we make current information available publicly as required by Rule 144. However, since being deregistered, some broker-dealers may require a one year holding period out of an abundance of caution if they take the position that the Company could have been a shell at some point. Shareholders including our affiliates could sell restricted securities after they have been held for six months if broker-dealers are willing to accept that the Company has never been a shell, subject to compliance with manner of sale, volume restrictions, Form 144 filing and current public information requirements.

No prediction can be made as to the effect, if any, that future sales of restricted shares of common stock, or the availability of such common stock for sale, would have on the market price of the common stock prevailing from time to time, assuming the resumption of trading. Sales of substantial amounts of such common stock in the public market, or the perception that such sales may occur, could adversely affect the then prevailing market price of the common stock.

Risk Factors Related to the COVID-19 Pandemic.

An occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. A pandemic typically results in social distancing, travel bans and quarantine, and this may limit access to our facilities, customers, management, support staff and professional advisors. These factors, in turn, may not only impact our operations, financial condition and demand for our product but our overall ability to react timely to mitigate the impact of this event. Our mine manager and two employee miners contracted COVID-19 and our operations were negatively affected in the form of delays in the execution of our business plan. Although, it appears that the Company will not continue to experience issues due to COVID-19, assuming that the vaccines on the market prove successful, of which there can be no assurance. It is possible that new variants of the COVID virus may develop and that they may have the same or worse impact on our operations and in our markets as was experienced with COVID-19.

Because we may issue additional shares of our common stock, investment in our company could be subject to substantial dilution.

Investors’ interests in our Company will be diluted and investors may suffer dilution in their net book value per share when we issue additional shares. We are authorized to issue 550,000,000 shares of common stock, $0.002 par value per share. As of June 30, 2021, 2020, and 2019 there were 433,018,551, 415,957,718 and 379,775,217 shares of our common stock issued and outstanding, respectively. We anticipate that all or at least some of our future funding, if any, will be in the form of equity financing from the sale of our common stock. If we do sell more common stock, investors’ investment in our company will likely be diluted. Dilution is the difference between what investors pay for

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their stock and the net tangible book value per share immediately after the additional shares are sold by us. If dilution occurs, any investment in our Company’s common stock could seriously decline in value.

Trading in our common stock on the OTC Pink Exchange has been subject to wide fluctuations.

Our common stock was quoted for public trading on OTC Markets prior to Commission order suspending trading that went into effect on December 17, 2020. Historically, the trading price of our common stock has been subject to wide fluctuations. Assuming trading resumes, of which there can be no assurance, the trading prices of our common stock may fluctuate in response to a number of factors, many of which will be beyond our control. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with limited business operations. There can be no assurance that trading prices and price earnings ratios previously experienced by our common stock will be matched or maintained. These broad market and industry factors may adversely affect the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs for us and a diversion of management’s attention and resources.

Delaware law our Articles of Incorporation and our by-laws provide for the indemnification of our officers and directors at our expense, and correspondingly limits their liability, which may result in a major cost to us and hurt the interests of our shareholders because corporate resources may be expended for the benefit of officers and/or directors.

Our Certificate of Incorporation and By-Laws include provisions that eliminate the personal liability of our directors for monetary damages to the fullest extent possible under the laws of the State of Delaware or other applicable law. These provisions eliminate the liability of our directors and our shareholders for monetary damages arising out of any violation of a director of his fiduciary duty of due care. Under Delaware law, however, such provisions do not eliminate the personal liability of a director for (i) breach of the director's duty of loyalty, (ii) acts or omissions not in good faith or involving intentional misconduct or knowing violation of law, (iii) payment of dividends or repurchases of stock other than from lawfully available funds, or (iv) any transaction from which the director derived an improper benefit. These provisions do not affect a director's liabilities under the federal securities laws or the recovery of damages by third parties.

We do not intend to pay cash dividends on any investment in the shares of stock of our Company and any gain on an investment in our Company will need to come through an increase in our stock’s price, which may never happen.

We have never paid any cash dividends and currently do not intend to pay any cash dividends for the foreseeable future. To the extent that we require additional funding currently not provided for, our funding sources may prohibit the payment of a dividend. Because we do not currently intend to declare dividends, any gain on an investment in our company will need to come through an increase in the stock’s price. This may never happen and investors may lose all of their investment in our company. 

FINRA sales practice requirements may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described above, the Financial Industry Regulatory Authority (known as “FINRA”) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common shares, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Trading was suspended on our common stock following the deregistration of our common stock in accordance with our settlement with the SEC.

Trading in our common stock was suspended after the SEC commenced Administrative Proceedings under 12k of the Exchange Act. The Commission then commenced proceedings under 12j of the Exchange Act to deregister our common stock because we had not posted current information by filing the required Periodic Reports on Forms 10-K and 10Q. We had not made these filings because of the need to restate our financial statements following the misappropriation of funds by our former CEO, Thomas Laws. However, notwithstanding these mitigating circumstances, the failure to file the required reports is a matter of strict liability and has resulted in the deregistration of our common stock, which became effective on December 17, 2020 following execution of our settlement agreement with the Commission. Consequently, we are required to have a market maker sponsor a Form 211 with FINRA in order for market makers to resume posting bids and offers. As of the date of this registration statement, we have not engaged a market maker to sponsor the filing required under Rule 15c-211. If we are not successful in finding a market maker to sponsor our Form 211 or if we engage a market maker in it later declines sponsoring our Form 211, it may be difficult for us to find another market maker to sponsor the Company. If we are unable to find a market maker to sponsor the Company and the filing of our Form 211 with FINRA, our common stock would not be eligible for quotation by market makers with bids and offers and the market for our securities would be extremely limited. Similarly, even if we are successful in engaging a market maker to sponsor the Company and to file our Form 211 with FINRA, the time it may take for FINRA approval is not determinable and we

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may not be able to provide what is required by FINRA or otherwise secure FINRA approval and the longer it takes to receive such approval, the longer it will take for market makers to be allowed to post bids and offers for our common stock.

We may not be able to find a market maker to sponsor the filing of our Form 211 with FINRA, or if we are able to engage a market maker but are unable to satisfy FINRA’s requirements in a timely manner or at all, market makers will not post bids or offers for our common stock.

If we are unable to find a market maker to sponsor the filing of our Form 211 with FINRA, market makers will not be allowed to post bid or offer prices for our common stock, making the market for our common stock extremely limited.  Even assuming we are successful in securing a market maker to sponsor the filing of a Form 211 with FINRA, of which there can be no assurances, there is no way to determine if FINRA will approve our common stock for quotation of bids and offers at all or if approved, whether such approval will be granted quickly or whether securing approval may be protracted.

Unless and until we are able to find a market maker willing to sponsor the filing of our Form 211 with FINRA and even if we are successful to that point, unless and until we are able to secure approval from FINRA, of which there can be no assurance, it may be difficult for the Company to secure the financing it requires to implement its business plan.

In connection with the Administrative Proceeding brought by the SEC pursuant to Section 12(j) of the Exchange Act, we have consented to the deregistration of our common stock and this became effective on December 17, 2020. This will require us to find and engage a market maker to sponsor and file a new Form 211 with FINRA in order to have bids and offers posted for our common stock. While market makers are allowed to rely on the information filed by a registrant with the SEC without further due diligence and we believe that the filing of this Registration Statement on Form 10 should allow us to receive FINRA approval more quickly than we would have if we had not been an Exchange Act reporting company, there is no way to determine the length of time it may take to receive approval or if we will receive approval at all. Any delays in our ability to secure a market maker to sponsor the filing of our Form 211 or its filing or approval by FINRA will delay market makers from posting bids and offers for our common stock and this in turn, may make it more difficult for the Company to find investors and the capital required for it to implement its business plan. The lack of an active market or even posted bids and offers severely limits our shareholders and prospective shareholders from availing themselves of an exit in the event that they need or want to sell their shares. As a result, many prospective investors may be reluctant to invest in our common stock unless we are able to have market makers resume posting bids and offers. Since the timing and even the ultimate outcome in our efforts to secure market maker sponsorship and FINRA approval are uncertain at this time, the Company may have difficulty in finding investors that are willing to purchase shares or if they are willing, they may not be willing to purchase unless shares are offered at substantially lower prices, if at all, all of which would have a negative impact on the Company and its operations.

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Item 2. Financial Information.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Basis of Presentation and Going Concern

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and supplementary data referred to in this Form 10. The consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business. If the Company becomes unable to continue as a going concern, it may be unable to realize the carrying value of its assets or to meet its liabilities as they become due.

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 put into production an acceptable source to generate mineralized ore to generate a revenue stream. Currently 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.

Cautionary Note Regarding Exploration Stage Status 

Company’s fiscal year ends on June 30^th each year Further, Regulation S-K 1300 added a significant number of definitions that were not applicable for the periods to our fiscal year 2021 which began July 1, 2020. We are considered an “exploration stage” company under both the SEC Industry Guide 7 and Regulation S-K 1300.  We have not established that our Billali Mine and Jim Crow Mine rights contain proven or probable reserves, as defined under Reg. S-K 1300. Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations (“Industry Guide 7”), because we do not have reserves or proven or provable reserves, respectively as defined under Industry Guide 7 and Regulation S-K 1300 et. seq. Reserves are defined in Industry Guide 7 as that part of a mineral deposit which can be economically and legally extracted or produced at the time of the reserve determination.  The establishment of reserves under Industry Guide 7 requires, among other things, certain spacing of exploratory drill holes to establish the required continuity of mineralization and the completion of a detailed cost or feasibility study. Under Regulation S-K 1300 establishment of reserves requires the completion of certain technical reports that are signed by a Qualified Person as defined in Regulation S-K 1300.

Because we have no reserves as defined in Industry Guide 7 or under Regulation S-K 1300, we have not exited the exploration stage and continue to report our financial information as an exploration stage entity as required under Generally Accepted Accounting Principles (“GAAP”). Although for purposes of FASB Accounting Standards Codification Topic 915, Development Stage Entities, we have exited the development stage and no longer report inception to date results of operations, cash flows and other financial information, we will remain an exploration stage company under Regulation S-K 1300 until such time as we demonstrate reserves in accordance with the criteria in Regulation S-K 1300.

Because we have no reserves, we have and will continue to expense all mine construction costs, even though these expenditures are expected to have a future economic benefit in excess of one year. We also expense our reclamation and remediation costs at the time the obligation is incurred.  Companies that have reserves and have exited the exploration stage typically capitalize these costs, and subsequently amortize them on a units-of-production basis as reserves are mined, with the resulting depletion charge allocated to inventory, and then to cost of sales as the inventory is sold.  As a result of these and other differences, our financial statements will not be comparable to the financial statements of mining companies that have established reserves and have exited the exploration stage.

Forward Looking Statements

This Registration Statement filed on Form 10 (“Registration Statement” or “Form 10”) contains certain “forward-looking” statements as such term is defined by the Securities and Exchange Commission in its rules, regulations and releases, which represent the Company’s expectations or beliefs, including but not limited to, statements concerning the Company’s strategy, operations, economic performance, financial condition, resource drilling strategies, investments, and future operational plans. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intent,” “could,” “estimate,” “might,” “plan,” “predict” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements. This Form 10 contains forward-looking statements, many assuming that the Company secures adequate financing and is able to continue as a going concern, including statements regarding, among other things: our ability to continue as a going concern; including but not limited to statements regarding the following:

•exploration for minerals is highly speculative and involves greater risk than many other businesses; as such, most  

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exploration programs fail to result in the discovery of economic mineralization;

•our mineralized material calculations at various projects are only estimates and are based principally on historic data; 

•actual capital costs, operating costs, production and economic returns may differ significantly from those that we have anticipated; 

•exposure to all of the risks associated with restarting and establishing new mining operations, if the development of one or more of our mineral projects is found to be economically feasible; 

•title to some of our mineral properties may be uncertain or defective; 

•land reclamation and mine closure may be burdensome and costly; 

•significant risk and hazards associated with mining operations; 

•we will require additional financing in the future to develop a mine at any other projects; 

•the requirements that we obtain, maintain and renew environmental, construction and mining permits, which is often a costly and time-consuming process and may be opposed by local environmental group; 

•our anticipated needs for working capital; 

•our ability to secure financing; 

•claims and legal proceedings against us;  

•our lack of necessary financial resources to complete development of our projects and the uncertainty of our future financing plans; 

•our exposure to material costs, liabilities and obligations because of environmental laws and regulations (including changes thereto) and permits; 

•changes in the price of silver and gold; 

•extensive regulation by the U.S. government as well as state and local governments; 

•our projected sales and profitability; 

•our business growth strategies; 

•anticipated trends in our industry; 

•the lack of commercial acceptance of our product or by-products; 

•problems regarding availability of materials and equipment; 

•failure of equipment to process or operate in accordance with specifications, including expected throughput, which could prevent the production of commercially viable output; and 

•our ability to seek out and acquire high quality gold and silver properties. 

Occurrence of such events or circumstances could have a material adverse effect on our business, financial condition, results of operations or cash flows or the market price of our securities. All subsequent written and oral forward-looking statements by or attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Except as may be required by securities or other law, the Company does not intend to undertake to update the information in these financial statements if any forward-looking statement later turns out to be inaccurate whether as a result of new information, future events, or other circumstances.

The following discussion contains forward-looking statements that involve risks and uncertainties. Such statements, which include statements concerning revenue sources and concentration, selling, general and administrative expenses and capital resources, are subject to risks and uncertainties, including, but not limited to, those discussed elsewhere in this Form 10 that could cause actual results to differ materially from those projected. The following discussion summarizes our plan of operation for the foreseeable future. It also summarizes the results of our operations for the fiscal year ended June 30, 2021, and compares those results to the fiscal year ended June 30, 2020.

Overview

Santa Fe Gold Corporation was originally incorporated in the State of Delaware on August 8, 1991 under the name Azco Mining, Inc. On August 21, 2007 we changed our name to Santa Fe Gold Corporation by duly amending our Certificate of Incorporation in the State of Delaware. We are a mining company engaged in the business of acquiring and developing metal and mineral properties that may contain recoverable gold and/or silver deposits. As an exploration company we own certain mining and mineral rights at our Alhambra-Blackhawk

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project and have right-of-use mineral rights in the Billali and Jim Crow-Imperial mine project in southwest New Mexico. Although management is optimistic about its plans for developing these properties, to date, minimal mining activities have commenced and there can be no assurance that they will or that if they do commence, that the Company’s mining activities will ultimately be profitable.  

Following our dismissal from bankruptcy in June 2016, although we continued our operations, we had no assets and approximately $20 million of indebtedness that was reinstated. The properties we currently own were acquired shortly after emerging from bankruptcy under Chapter 11 of the United States Bankruptcy Code. We have been, and currently are, in the process of raising capital that is required, in part, to continue development of our current mining properties and to help meet our working capital requirements. There can be no assurances that we will be successful in raising the capital necessary to implement our business plan or if we are successful, that there may not be additional or superseding demands on our capital resources. Although the Company has been successful in meeting its capital requirements since emerging from Bankruptcy and management is optimistic about being able to secure needed funding, any failure to do so or any unforeseen expenses or other demands on the Company’s capital could result in the need to curtail or cease operations, resulting in losses to investors.

Discussion on Debt Extinguishment During Our Fiscal Year Ended June 30, 2019

At the end of the Company’s fiscal year ending June 30, 2019, the Company initially wrote off debt and related accrued interest aggregating $12,507,540. The write off of debt was related to two finance facilities governed by and enforceable under British Columbia statutes. The Company retained legal services in British Columbia to research the British Columbia statutes of limitations on the collectability of the finance facilities. Legal counsel reviewed all related documents, records of proceedings and all records and documents deemed relevant to the two finance facilities. It was determined that the finance facilities were subject to the laws of the Providence of British Columbia and the National laws of Canada. The Company received a written legal opinion from Canadian counsel that any liability under the two finance facilities because of the Limitations Act (British Columbia) and the relevant case law in British Columbia, were no longer enforceable. That is, because the statute of limitations had run for the two finance facility liabilities pursuant to the Limitations Act (British Columbia), no future claims can be commenced in the Province of British Columbia and therefore, the Company has no outstanding legal obligation on the two finance facilities. With this decrease in our outstanding liabilities resulted in a one-time non-cash gain of $12,507,540 during the fiscal year ended June 30, 2019. Comments received from the SEC expressed concern with the Company taking this write-down because FASB ASC 405-20-40-1(b) 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.”  The Commission Staff was willing to allow an opinion of counsel, however the opinions we provided did not meet the standard that the Commission requires. The standard that the Commission Staff requires is what is sometimes referred to as a “would” or “will” opinion. In requiring a “will” or “would” opinion, the Commission is looking for greater assurance that the Company “would” or “will” be successful in the event that one of the creditors sought to collect on the liabilities. Although this standard may seem subjective, “will opinions” are regularly used in the context of tax law where a tax opinion is needed. In that context the term “will” means that the drafter of the opinion believes and is effectively stating that there is a 90%-95% probability that a given result “will” come to pass based on the facts present. Absent the availability of one of these three routes to write-off the liabilities, he Commission Staff’s position is that the correct treatment of the aforementioned liabilities is to continue carrying them on the Company’s balance sheets. The Company was not able to procure a judicial order in a timely manner, specific written agreement of the creditors nor an opinion of counsel meeting the “would” or “will” standard, therefore it determined the most expeditious course of action was to restate the consolidated financial statements so that the liabilities that were written-off are now included in the liabilities of the Company once again; in effect, restating the consolidated financial statements as of June 30, 2019. In effect, the write-offs were disallowed and the Company has restated the audited financial statements for the fiscal year ended June 30, 2019 to reflect required changes by the SEC and carried these changes through the other financial statements presented in this Form 10. The Company is currently pursuing the course of action required by the SEC to reinstate the write-offs (“debt”).

Although, in a future period, while the Company plans to either seek a judicial determination or an opinion of counsel that meets the “would” or “will” standard with respect to the liabilities, there can be no assurance that the Company will be successful in meeting the requirements necessary to write-off the aforementioned liabilities or that the Commission will agree that the judicial determination or opinion of counsel satisfies the requirements and spirit of FASB ASC 405-20-40-1(b) and seek to have us restate them (like is being done on this Registration Statement filed on Form 10). In effect, disallowed the write off under the FASB Amendments to Subtopic 405-20, Derecognition 405-20-40-1. In this Form 10, the Company has restated the audited financial statements for the fiscal year ended June 30, 2019 to reflect required changes by the SEC and these changes then carry through the other financial statements presented in this Form 10.

The Company also paid off a note payable signed settlement agreement with a note holder and recorded a forgiveness of debt aggregating $112,625 on the debt extinguishment during the fiscal year ended June 30, 2019.

Basis of Presentation 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.

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Below presents summary financial information at the three fiscal years presented in this Form 10 filing.

		June 30,
		2021		2020 (Restated)		2019 (Restated)
Cash on hand	$	27,458	$	103,096	$	264,900
Working capital deficit	$	(20,372,840)	$	(19,081,533)	$	(16,623,864)
Stockholder deficit	$	(16,015,057)	$	(15,328,615)	$	(13,282,956)
Current year net (loss)	$	(2,080,512)	$	(4,573,436)	$	(3,972,836

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 implemented production at one of our recently acquired mine sites and generating substantial cash flow from operations and an acceptable source 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 fiscal years ending June 30, 2021, 2020 and 2019, the Company was in default on debt facility payments, accounts payable and accrued liabilities related to pre-bankruptcy obligations as follows:

		June 30,
		2021		2020 (Restated)		2019 (Restated)
Amount due under the Gold Stream Agreement	$	10,003,500	$	9,845,467	$	8,337,128
Other notes payable	$	2,143,885	$	2,143,885	$	2,143,885
Accrued other notes payable interest	$	3,150,606	$	2,708,854	$	2,265,953
Accounts payable and other accrued liabilities	$	3,644,799	$	3,632,595	$	3,797,585

Current Fiscal Year Ended June 30, 2021

As of June 30, 2021, we had cash of $27,458 and a working capital deficit of $20,372,840. At June 30, 2021, we were in arrears on old debt aggregating approximately $18,942,790 that was incurred prior to our bankruptcy filing. At June 30, 2021 and 2020, we have an accumulated deficit of $112,640,158 and $110,559,646, respectively. To continue as a going concern, we are dependent on continued fund raising and future cash flow from operations. However, currently we have no commitment in place from any party to provide additional capital and there is no assurance that such funding will be available, or if available, that its terms will be favorable or acceptable to us or that sufficient cash flow will be obtained in future periods, to allow us to meet our obligations as they come due, or otherwise allow us to meet our business plan.  All current funding is on a best-efforts basis, by the Company.

During the six months ended December 31, 2020, the Company focused primarily on repair and improvement projects work at the Jim Crow and Billali mine sites and continued our mining operations at those sites and stockpiled the mined head ore for future processing and concentration. At the end of November 2020, we shut down the mining operation due to three mining personnel exposed to COVID-19 and the smelter that was to process our approved mineralized ore stopped taking outside ore for processing. With no current place to economically process our mined ore, the Company has placed the mines and equipment under a maintenance protocol and currently we anticipate not resuming the mining operation until we can construct our mill to process and concentrate our ore in Duncan, Arizona. We project this will not occur until August or September 2022.

On December 1, 2020, the Company made a joint announcement with Texas Mineral Resources Corp. (“TMRC”) (OTCQB:TMRC) of the execution of a letter agreement to pursue, negotiate and subsequently enter into a 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. As of the filing of this Form 10, a portion of these activities has commenced as disclosed in a TMRC press release in November 2021.

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During April, 2021, we engaged a mining engineering firm in Denver, Colorado to design the mill for the Duncan, Arizona site. This project will include the design, layout, equipment required, extraction process and reagents required to obtain maximum recovery of precious metals from our head ore. Because of the current high activity in the mining sector resulting from the high prices of precious metals, it is projected at 4 to 6 months to complete this initial phase of the mill project from the time we receive the equipment requirements and procure the equipment. Currently we are pursuing the financing on this project or a lease purchase financing facility. We received the engineering report in late October 2021 and a site review by engineers in November 2021. We closed on the mill site acquisition on November 9, 2021. Currently we have a company in Tucson, Arizona, that is in process of sourcing all the equipment and related parts to construct the mill in Duncan, Arizona.

There can be no assurance of any revenue from these mine sites until we build our processing mill site in Duncan, Arizona. Ore previously produced is being inventoried for future processing at the future mill site. Even if we are successful as an exploration stage company and then in developing any of our properties, we expect to incur operating losses for the foreseeable future and may never become profitable. We also expect to continue to incur significant operating and capital expenditures and anticipate that our expenses will increase substantially in the foreseeable future. As the Company has no commitment for debt or equity financing, the Company will be reliant upon its own best-efforts fundraising activities to provide sufficient working capital to fund current and immediate future needs. There can be no assurance that the Company will be successful in its capital raising efforts, and the failure to raise needed capital will likely result in the curtailment or cessation of our business which would adversely affect our investors.

COMPARISON OF THE TWO CURRENT FISCAL YEARS ENDED JUNE 30, 2021 AND 2020

Results of Operations – Fiscal Years Ended June 30, 2021 and 2020 (Restated)

Revenue

During the fiscal years ended June 30, 2021 and 2020 (Restated), the Company had no revenue, although we continued enhancing our mining opportunities and reached various important milestones in those fiscal years at the Jim Crow and Bilalli mine sites.

Operating Expenses

Our operating cost incurred in our fiscal year ended June 30, 2021, decreased $404,681 from $2,615,434 in the fiscal year ended June 30, 2020 (Restated)to $2,210,753 for the fiscal year ended June 30, 2021. This decrease is due to the significant changes in certain costs shown as follows.

Exploration and Mine Related Costs

The decrease in exploration and mine related costs incurred in the current fiscal year was $458,831 and were decreased mainly on the Jim Crow mine. The decrease was mainly attributable to changes in the following significant areas:

	June 30,
	2021	2020 (Restated)	Variance
Payroll burden and related costs	$  269,702	$  651,374	($  381,672)
General expenses	5,733	51,013	(45,280)
Contractor fees	—	63,817	(63,817)
Leased equipment	7,200	58,361	(51,161)
Explosives	13,021	40,288	(27,267)
Mine development	18,105	71,485	(53,380)
Net property tax adjustment	—	(159,921)	159,921
Water rights	39,084	15,228	23,856
	$  352,845	$  791,645	($  438,800)

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General and Administrative

The increase in general and administrative of $52,314 was mainly attributable to changes in the following significant areas:

	June 30,
	2021	2020 (Restated)
			Variance
Administrative payroll burden	$  422,140	$  275,040	$  147,100
Medical and dental insurance expenses	13,855	50,922	(37,067)
Audit fees	74,713	297,265	(222,552)
Accounting and financial reporting	476	116,348	(115,872)
Director fees	300,000	75,000	225,000
Consulting fees	214,932	153,042	61,890
General and insurance expenses	26,438	15,878	10,560
Transfer agent fees	8,765	3,470	5,295
Loss on conversion	—	37,414	(37,414)
Legal fees	222,511	386,935	(164,424)
Option and warrant costs	360,237	200,212	160,025
	$  1,644,067	$  1,611,526	$  32,541

Other Income (Expense)

Other income and (expense) for the fiscal year ended June 30, 2021, was $130,241 as compared to $(1,958,002) for the fiscal year ended June 30, 2020, an increase in other income of $2,088,243. The increase in other income was mainly attributable to changes in the following significant components:

	June 30,
	2021	2020 (Restated)
			Variance
Recovery of misappropriated funds	$  533,890	$  27,539	$  506,351
Gain on debt forgiveness	226,367	—	226,367
Interest income	2	7	(5)
Financing costs- commodity supply agreement	18,360	(1,331,946)	1,350,306
Interest expense	(648,378)	(653,602)	5,224
	$  130,241	($  1,958,002)	$  2,088,243

Summary of Financing and Investing Activities for the Fiscal Years ended June 30, 2021 and 2020

Recent Equity Financing and Debt Settlements in Shares

The following table sets forth a summary of equity financing and debt settlements for our fiscal years ended June 30, 2021 and, 2020:

	June 30, 2021	June 30, 2020 (Restated)
Restricted common stock sold to accredited investors	15,366,668	32,452,381
Gross proceeds from equity financings	$  929,004	$  2,080,000
SBA PPP loan proceeds	1,095,200	224,700
Insurance proceeds from truck accident	17,906	—
Note proceeds	180,000	—
Note proceeds from related party	—	80,189
Cash received for working capital	$  2,222,110	$  2,384,889
Gain on debt extinguishment – PPP loans	$     226,367	$              —
Debt settled in common stock	$     104,833	$     247,565

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Cash Flows from Investing Activities

The Company continues to build our asset base with capital expenditures.

	June 30, 2021	June 30, 2020 (Restated)
Payment on mineral leases	$  300,000	$  300,000
Payment on mill design	20,000	—
Purchase of equipment	2,860	344,401
	$  322,860	$  644,401

Off-Balance Sheet Arrangements

During the fiscal years ended June 30, 2021, 2020 and 2019, we did not engage in any off-balance sheet arrangements as set forth in Item 303(a) (4) of the Regulation S-K.

COMPARISON OF THE THREE AND NINE MONTHS ENDED MARCH 31, 2022 AND 2021 (Unaudited)

Results of Operations

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021

Revenue

During the three months ended March 31, 2022 and 2021, the Company had no revenue.

Operating Expenses

Our operating expenses incurred in our three months ended March 31, 2022, decreased $65,255 from $365,118 in the three months ended March 31, 2021 to $299,863 for the three months ended March 31, 2022. This decrease is due to the significant changes in certain costs as follows.

Exploration and mine related costs

The decrease in exploration and mine related costs incurred in the current the three months period was $2,358 and was mainly attributable to decreases in the following significant areas: amortization of $4,568 and general mine elated costs of $3,694 and was offset increased in BLM fees of $5,425.

General and administrative

The general and administrative incurred in the three months period ended March 31, 2022, decreased $63,553 from $331,668 in the three-months ended March 31, 2021 to $268,115 for the three months ended March 31, 2022. This decrease is mainly attributable decreases in the following areas: non-cash costs attributable for warrants and options issued of $26,216; consulting fees of $59,950 and insurance of $6,770 and general expenses of $7,337. These decreases were offset by increases mainly in the following areas: office costs of $2,715; corporate filing fees of $3,650 audit and legal fee of $29,335.

Other Income (Expense)

Other income and (expense) for the three months ended March 31, 2022, was $(674,817) as compared to $1,088,119 for the three months ended March 31, 2021, a increase in other expense of $1,762,936. The increase in other expense was attributable to decreases in following other income items in the current period: miscellaneous income of $7,384; gain on debt extinguishment of $226,367; recovery of misappropriated funds of $$286,090; finance costs-commodity supply agreement of $1,234,582; and an increase in interest expense of $8,513.

Nine Months Ended March 31, 2022 Compared to Nine Months Ended March 31, 2021

Revenue

During the nine months ended March 31, 2022 and 2021, the Company had no revenue.

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Operating Expenses

Our operating expenses incurred in our nine months ended March 31, 2022 decreased $685,959 from $1,891,998 in the nine months ended March 31, 2021 to $1,206,039 for the nine months ended March 31, 2022. This decrease is due to the significant changes in certain costs as follows.

Exploration and mine related costs

The decrease in exploration and mine related costs incurred in the current the nine months period was $386,869 and are attributable to decreases in the following significant areas: wages and related payroll costs of $267,331; workmen’s compensation insurance of $22,666; depreciation and amortization of $10,654; mine operating costs of $89,802 and general expenses of $5,695. These decreases were off-set by increases in BLM fees of $12,770.

General and administrative

The decrease in general and administrative incurred in the nine months period ended March 31, 2022 was $297,254, from $1,401,954 in the nine months ended March 31, 2021 to $1,104,700 for the nine months ended March 31, 2022. This decrease is mainly attributable decreases in the following areas: liability insurance of $20,191; wages of $45,000; consulting fees of $189,932; legal fees of $86,083 and SEC processing fees of $10,785. These decreases were offset by increases in the following areas: non-cash costs attributable for warrants and options issued of $21,620; corporate filing fees of $5,544; office costs of $6,485 and audit fees of $22,895.

Other Income (Expense)

Other income and (expense) for the nine months ended March 31,2022, was $(1,165,858) as compared to $583,872 for the nine months ended March 31, 2021, an increase in other expense of $(1,749,730). The increase in other expense was attributable to decreases in the following areas: interest income of $2; miscellaneous income of $7,384; gain on debt  extinguishment of $226,367; recovery of misappropriated funds of $551,612 and increases in expenses in finance costs-commodity supply agreement of $949,721 and interest expense of $14.644.

LIQUIDITY AND CAPITAL RESOURCES; PLAN OF OPERATIONS – FOR FISCAL YEAR 2022

Liquidity and Capital Resources

As of June 30, 2021, we had cash of $27,458 and a working capital deficit of $20,372,840. At June 30, 2021, we were in arrears on old debt aggregating approximately $19,027,354 that was incurred prior to our bankruptcy filing. We have had no revenues since emerging from bankruptcy, and we are not currently profitable.  We currently do not have sufficient capital to fund operations through our fiscal year ending June 30, 2022 and will need to raise additional funding to implement our current business strategy and projects in the planning stage. Currently, there can be no assurance of any revenue from our mine sites until we build our processing mill site in Duncan, Arizona. Ore that has been produced prior to the COVID-19 shut down is being inventoried for future processing at the future mill site. Even if we are successful in developing any of our properties, we expect to incur operating losses for the foreseeable future and may never become profitable.

Plan of Operation for Fiscal Year 2022

Currently we have no continuing commitment from any party to provide additional working capital, or if one becomes available, there is no certainty that its terms will be favorable or acceptable to the Company. Historically, we and other similar exploration and development public companies have accessed capital through equity financing arrangements or by the sale of royalties on its mineral properties. If, however we are unable to obtain additional capital or financing, our exploration and development activities will be significantly adversely affected. Until positive cash flow is generated from operations, we will be dependent upon future working capital credit/finance facilities or equity financing arrangements to meet our expenses and to fund execution on our business plan.

We currently anticipate approximate cash expenditures for our fiscal year 2022 to be as follows:

• $800 thousand on corporate administration expenses, comprising of executive management and employee salaries, legal, audit, marketing, SEC filings and other general and administrative expenses.

• $0.9 million to $1.1 million on the Jim Crow and Billali projects including exploration, mine development programs, mine operational costs, including employee salaries, benefits and land holding costs.

• $1.9 million for the mill site construction project in Duncan, Arizona which includes costs of the design process and flow charts, payoff on site real estate, site equipment, site construction, project development ramp up and operating costs.

We also expect to continue to incur significant operating and capital expenditures and anticipate that our expenses will increase substantially in the foreseeable future. As the Company has no commitment for debt or equity financing, the Company will be reliant upon its own best-

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efforts fundraising activities to provide sufficient working capital to fund current and immediate future needs. There can be no assurance that the Company will be successful in its capital raising efforts, and the failure to raise needed capital will likely result in the curtailment or cessation of our business which would adversely affect investors.

Planned Joint Venture with Texas Mineral Resources Corporation

Following the period ending September 30, 2020, we entered into a letter of intent with Texas Mineral Resources Corporation (“TMRC”) to form a joint venture for the undertaking to secure a 43-101 on a best-efforts basis on our mining property and a bankable feasibility study that if and when it is completed will allow the parties to finance and undertake the development and operation of an 80-acre area within our larger mining property. That is TMRC has agreed to incur the costs and undertake the work required to secure a 43-101 setting forth the provable reserves of gold and silver on our property and a bankable feasibility study that will allow them to then develop and conduct mining operations on 80 acres of its choice within our property that is subject to our patented and unpatented mining claims located in the Blackhawk Mining District. Our preliminary agreement contemplates that TMRC will incur all of the costs required to provide us with a 43-101 and a bankable feasibility study which may cost up to approximately $6 million. If successful, TMRC will be responsible for overseeing mining operations on the 80-acre area, following the completion of a bankable feasibility study and securing the required funding.  Profits, if successful, will be shared on a 49%/51% basis, with TMRC receiving the larger portion. The letter of intent provides TMRC with a right of first refusal in the event that the Company chooses to enter into any further partnership or joint venture with a third party for the development or operation of any additional mining operations outside of the 80-acre area that is the subject of the initial joint venture agreement. No assurances can be given that TMRC will be able to secure the funding necessary to complete a 43-101 on a best-efforts basis or bankable feasibility study or if they are successful in securing the necessary funding, that their efforts will yield either a 43-101 or bankable feasibility study (although our preliminary work leads us both to be optimistic regarding the prospects that they will be successful if they are able to secure funding as planned.)  Further, the letter of intent requires us to prepare and execute a definitive agreement and related documentation, there can be no assurance that we will be successful in our efforts as we prepare an agreement and related document that we will be able to mutually agree on the terms contained in them. The letter of intent does not contain a requirement for a commencement date for TMRC and there are a number of material terms that will need to be agreed upon by both parties before TMRC will begin work securing the 43-101 and bankable feasibility study. The Company is optimistic that it will be successful in reaching mutually acceptable terms and conditions, however if the parties were unable to agree upon any of the necessary terms or are unable to reach “a meeting of the minds” for any reason, the Company would need to either secure the funding needed to move forward with the work that TMRC was going to do, itself or otherwise find another joint venture partner that, has the capability and resources necessary to complete a 43-101 identifying provable reserves of gold and silver along with a bankable feasibility study and negotiate and reach mutual agreement on the terms required for these steps to proceed. The expenses associated with the forgoing are substantial and the funds deployed are done so at substantial risk to the investor, there are not a large number of investors who are willing to invest in and assume this type or kind of risk. Although TMRC believes it has the necessary funding available for it to successfully perform its duties under our planned joint venture, any delays or difficulties they incur would have a direct negative impact on the Company and its operations. If TMRC were to have difficulty securing the funding required for completion of this step or if the terms it is able to negotiate for funding are not acceptable, we would either be required to secure the necessary funding of this step ourselves or enter into a joint venture or partnership with another party who has the resources necessary to complete this step. No assurances can be made that (a) the Company would be successful in finding another joint venture partner with such resources or (b) that it would be successful in securing the necessary financing required for this step itself or (c) that the terms another joint venture partner may require would be acceptable to the Company even if it has the resources required to see this step through to completion. Any of the forgoing difficulties would necessarily have a negative impact on the Company and its plan of operations.

The forgoing discussion is based upon Industry Guide 7’s terminology and requirements. The Company plans to enter into a definitive agreement with TMRC based upon Regulation S-K 1300’s changes. That is where the terms “43-101” and “Bankable Feasibility Study” are used, the parties will make clear and within the terms and definitions set forth in Regulation S-K 1300 what the parties’ intent is.

Critical Accounting Policies

Our discussion and analysis of our consolidated financial condition and results of operations are based on the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses for each period. Critical accounting policies are defined, as policies that management believes are the most important to the portrayal of our consolidated financial condition and results of operations. These policies may require us to make difficult, subjective or complex judgments, commonly about the effects of matters that are inherently uncertain.

Our significant accounting policies are described in the audited consolidated financial statements and notes thereto. See Note 2, “Summary of Significant Accounting Policies” in the Notes to the Consolidated Financial Statements for the fiscal years June 30, 2021 and 2020 (Restated) and 2019 (Restated), these describe our significant accounting policies which are reviewed by management on a regular basis.

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We believe our most critical accounting policies relate to asset retirement obligations, derivative instruments and variables used (a) in the Black-Scholes option pricing model, (b) the Monte Carlo Model utilized by Chartered Financial Advisors, used for certain required estimates utilized and (d) for stock-based compensation and option and warrant valuations.

Item 3. Properties.

Patented Mining Claims

We hold seven (7) patented claims related to the Jim Crow Imperial Mine and one (1) for the Billali Mine, all of which are held by our wholly owned subsidiary, Minerals Acquisitions, LLC together with thirteen (13) for the Alhambra Mine held by our wholly owned subsidiary, Bullard’s Peak Corporation.  Patented mining claims, such as the ones located in our Jim Crow Imperial Mine, our Billali Mine and our Alhambra Mine, are mining claims on federal lands that are held in fee simple by the owner. No maintenance fees or royalties are payable to the BLM; however, payments and royalties with third parties are applicable on some of these claims.

Unpatented Mining Claims

We hold two (2) unpatented mining claims for the Jim Crow Imperial Mine held by our wholly owned subsidiary, Minerals Acquisitions, LLC and there are no unpatented claims for the Billali Mine. Eighty-two (82) of our claims for the Alhambra Mine, held by our wholly owned subsidiary, Bullard’s Peak Corporation, are considered “unpatented.” In November 2020, Minerals Acquisition, LLC acquired, by quick claim deed, an additional nine (9) unpatented mining claims in the Steeple Rock Mining District, Grant County, New Mexico, these are claims that do not cover the 3 mining properties we have discussed.

The Mining Law of 1872

Thus, our mining rights consist of agreements covering “patented” and "unpatented" mining claims created and maintained in accordance with the U.S. General Mining Law of 1872, or the “General Mining Law.” Unpatented mining claims are unique U.S. property interests and are generally considered to be subject to greater title risk than other real property interests because the validity of unpatented mining claims is often uncertain. The validity of an unpatented mining claim, in terms of both its location and its maintenance, is dependent on strict compliance with a complex body of federal and state statutory and decisional law that supplement the General Mining Law. Also, unpatented mining claims and related rights, including rights to use the surface, are subject to possible challenges by third parties or contests by the federal government. In addition, there are few public records that definitively control the issues of validity and ownership of unpatented mining claims. We have not filed a patent application for any of our unpatented mining claims that are located on federal public lands in the United States and, under possible future legislation to change the General Mining Law, patents may be difficult to obtain.

Our exploration, development and mining rights relate to patented and unpatented mining claims covering federal and State lands in the State of New Mexico. Location of mining claims under the General Mining Law, is a self-initiation system under which a person physically stakes an unpatented mining claim on public land that is open to location, posts a location notice and monuments the boundaries of the claim in compliance with federal laws and regulations and with state location laws, and files notice of that location in the county records and with the Bureau of Land Management (“BLM”). Mining claims can be located on land as to which the surface was patented into private ownership under the Stock Raising Homestead Act of 1916, 43 U.S.C. §299, but the mining claimant cannot injure, damage or destroy the surface owner's permanent improvements and must pay for damage to crops caused by prospecting. Discovery of a valuable mineral deposit, as defined under federal law, is essential to the validity of an unpatented mining claim and is required on each mining claim individually. The location is made as a lode claim for mineral deposits found as veins or rock in place, or as a placer claim for other deposits. While the maximum size and shape of lode claims and placer claims are established by statute, there are no limits on the number of claims one person may locate or own. The General Mining Law also contains a provision for acquiring five-acre claims of non-mineral land for mill site purposes. A mining operation typically is comprised of many mining claims.

The holder of a valid unpatented mining claim has possessory title to the land covered thereby, which gives the claimant exclusive possession of the surface for mining purposes and the right to mine and remove minerals from the claim. Legal title to land encompassed by an unpatented mining claim remains in the United States, and the government can contest the validity of a mining claim. The General Mining Law requires the performance of annual assessment work for each claim, and subsequent to enactment of the Federal Land Policy and Management Act of 1976, 43 U.S.C. §1201 et seq., mining claims are invalidated if evidence of assessment work is not timely filed with the BLM. However, in 1993 Congress enacted a provision requiring payment of a small claim maintenance fee in lieu of performing assessment work, subject to an exception for small miners having less than 10 claims. No royalty is paid to the United States with respect to minerals mined and sold from a mining claim. The General Mining Law provides a procedure for a qualified claimant to obtain a mineral patent (i.e., fee simple title to the mining claim) under certain conditions. It has become much more difficult in recent years to obtain a patent. Beginning in 1994, Congress imposed a funding moratorium on the processing of mineral patent applications which had not reached a designated stage in the patent process at the time the moratorium went into effect. Additionally, Congress has considered several bills in recent years to repeal the General Mining Law or to amend it to provide for the payment of royalties to the United States and to eliminate or substantially limit the patent provisions of the law. Any such changes to the law and increases to our costs would have a negative impact on our results of operations.

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Mining claims are conveyed by deed or leased by the claimant to the party seeking to develop the property. Such a deed or lease (or memorandum of it needs to be recorded in the real property records of the county where the property is located, and evidence of such transfer needs to be filed with the BLM in order to secure “title” to such claims. It is not unusual for the grantor or lessor to reserve a royalty, which as to precious metals often is expressed as a percentage of net smelter returns.

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Overview of Mining Properties Locations   

 

Steeple Rock District, Grant County New Mexico – Project Description

Properties - The Jim Crow, Imperial and Billali Mines

Santa Fe’s properties consist of the Jim Crow group of patented and unpatented claims in the southern part of the district and the Billali patented claim in the northern part of the district. The Jim Crow group is made up of seven patented mining claims and the Billali consists of one (1) patented mining claim.

Patented Lode Claims

	Name	MS No.
1	Imperial Lode	MS 1012 A
2	Jim Crow Lode	MS 1012 B
3	Gold King Lode	MS 1012 C
4	Portal Lode	MS 1012 D
5	Gold Bug Lode	MS 1012 E
6	Red Prince Lode	MS 1012 F
7	Three Brothers Lode	MS 1012 G
8	Contention Lode	MS 1012 H

The Jim Crow group also consists of two unpatented mining claims and Mineral Acquisitions, LLC controls nine unpatented mining claims.

Unpatented Lode Claims

	Name	BLM Serial Number
1	Papoose No 1 Lode	Leslie Billingsley – claimant
2	Papoose No 2 Lode	Leslie Billingsley - claimant
3	Telephone Ridge No 1	NMMC193685

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4	Telephone Ridge No 2	NMMC193686
5	Telephone Ridge No 3	NMMC193687
6	Telephone Ridge No 4	NMMC196049
7	Telephone Ridge No 5	NMMC196050
8	Telephone Ridge No 6	NMMC196051
9	Telephone Ridge No 7	NMMC196052
10	Telephone Ridge No 8	NMMC196053
11	Telephone Ridge No 9	NMMC196054

All the combined mining claims for this project encompass approximately 343 acres.

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Location and Access

The Steeple Rock mining district is in the western part of Grant County, New Mexico. The district lies approximately 45 miles east of the town of Safford, Arizona and approximately 10 miles northeast of Duncan, Arizona. The district is reached by well-maintained county roads from Duncan.

 

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District, Historical and Prior Operations

The Steeple Rock district was discovered in the 1860’s and was in production until the so-called “silver panic” of 1893.  Since 1893, there has been little activity.  We believe that the Steeple Rock district was reopened at different times in the 1950’s, 1960’s and the 1970’s, but no sustained development or production is believed to have occurred. There has been some trenching and surface Geochem work done at various times. During the time of elevated precious metal prices after 1980 there was considerable activity, including a project at the Imperial-Jim Crow Mine by Queenstake Resources in the early 1980’s and work by ASARCO also in the 1980’s. The Billali was explored by Biron Bay Resources in 1990-1993 and again in 2013-2014 by Shooting Star Mining Co. In 2010 the Summit mine was successfully developed and operated but closed in 2013.

Title and Ownership of the Billali, Jim Crow and Imperial Mine Projects

The Company determined the Agreement with the sellers of the properties is Right of Use (“ROU”) asset lease at its inception and provides for grant of use. The Company has the right to cancel the Agreement at any time. The Company currently considers the properties to be exploration properties. The Agreement gives the Company surface, mining, and access rights. These are subject only to any limitations imposed by federal, state and local regulations, the free, unrestricted and uninterrupted right of access, for ingress and egress to the Billali, Jim Crow and Imperial Mines over existing roads or alternate routes approved by Seller and the right to enter upon and occupy the Billali, Jim Crow and Imperial Mines for all purposes reasonably incident to: exploring for, developing, mining (by underground mining, surface mining, strip mining or any other surface or subsurface method, including any method later developed), extracting, milling, smelting, refining, stockpiling, storing, processing, removing and marketing there from, all ores, metals, minerals, mineral products (including intermediate products) and materials of every nature or sort, and the right to place, construct, maintain, use and thereafter remove such structures, facilities, equipment, roadways, haulage ways, utility lines, reservoirs and water courses, and other improvements as may be necessary, useful or convenient for the full enjoyment of all of the rights granted, are the rights granted by the seller under our agreement. We have sole and exclusive custody, possession, ownership and control of all ore, rock, drill core and other mineral substances extracted or removed from the Billali, and Jim Crow and Imperial Mines and may sell or otherwise dispose any of the forgoing. We have also been granted the right to use any of the seller’s water rights, which were assigned to the Company, on, about, under or appurtenant to the Billali and Jim Crow Mines to facilitate the exploration, mining and processing rights we were granted under our agreement with the seller. Until the total price under the agreement is paid in full, title on all of the properties and all unpatented property will remain in the name of the seller.  

Mineralization and Geology

The Steeple Rock district is classified as a high level, epithermal gold and silver bearing, quartz vein system hosted principally in andesite lava flow rock which comprises the lower part of the tertiary volcanic section in the region. Other rocks exposed within the district are

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Precambrian igneous and metamorphic rocks, Paleozoic sedimentary rocks, and Mesozoic igneous and sedimentary rocks. The veins trend northwesterly and northerly. Most of the historic production has been from the northwest trending set of veins. Veins within the district are numerous and only a few of them have undergone systematic development to date. The ore in the Steeple Rock district appears to be controlled by rock lithology, with the host rock being a coarse-grained quartz diorite. Vein boundaries are sharp and the vein filings are generally recognizable visually. Mineralization in the Steeple Rock mining district consists of numerous narrow carbonate veins containing varying amounts of cobalt and nickel, silver, uranium, and arsenic. This is a geologic type of mineral deposit generally referred to as “five element veins.”

Description of the Jim Crow and Imperial Mines

The Jim Crow group covers approximately 4,000 feet strike length on the north trending Imperial vein and approximately 2,600 feet strike length of the northwest trending Jim Crow vein system. The Imperial mine occupies the southernmost 1,000 feet of the Imperial vein at which point the Jim Crow system branches to the northwest. The north trending Imperial continues another 3,050 to the property end line.  The Jim Crow trend consists of three, possibly more, sub-parallel veins converging in the northwest.

The Jim Crow mine is well equipped and in good working order. It is served by a 320-foot-deep inclined shaft with a well-designed steel headframe. The hoist is equipped with up-to-date safety devices. The shaft is capable of lifting 30 tons per hour and can handle both ore and waste at the same time. The mine has three levels, 50 feet, 200 feet and 300 feet, all with air, water and ventilation services installed. Broken muck is moved to the shaft by scrapers on the 50- and 200-foot levels and by a 2-foot gauge rail on the 300-foot level.

The location of the Jim Crow mine is highly advantageous in that the unexplored and undeveloped segments of the Imperial and Jim Crow veins can be easily accessed from the mine. The lower 300-foot level can be extended to the south to explore and develop the Imperial vein below it and the lowermost 200-foot level in the area intercepted by the encouraging drill holes. It can also be extended to the northwest to explore the northwest extension of the Jim Crow vein and its parallel “wall” veins and the area where these veins “intersect.” The unexplored north trending segment of the Imperial vein could also be readily accessed from the Jim Crow Mine.

Description of the Billali Mine

The Billali property consists of one patented mining claim. It covers 1,200 feet of vein length and is situated approximately 3,000 feet northwest of the Summit mine.

The principal working on the Billali is a 12’ x12’ decline driven at grade of -20% for approximately 1120 feet.  The decline was started on the northeast flank of the vein zone, driven across it for approximately 260 feet and then turned southeast and continued straight along the zone for another, approximately 580 feet. The present water level is at approximately 800 feet. From that point it extends in an irregular manner for another 650 feet to its present head which is approximately 260 feet vertically below the portal. A lateral level was driven 300 feet northeast across the vein zone from the bottom of the decline. The first 856 feet of the decline is set up for rail haulage using a winch stationed on the surface.

The Billali Mine occupies the northwest extension of the Summit vein. In the 1990-1992 time period Byron Bay Resources, a Canadian mining company, conducted an extensive exploration program on the Summit vein including the Billali mine. Data in the mine owner’s archives are poorly documented and drill hole collars are not definitely located. Diamond drilling was done on the Billali claim in 1990, 1991 and 1992. Partial data is available for twenty of these drill holes. Byron Bay Resources company reports dated 1990 and 1991 describe a vein zone approximately 350 feet wide with a discontinuously mineralized footwall and hanging wall quartz veins, ranging from 3 to 15 feet true width.

In 2013 and 2014 Shooting Star Mining Co. optioned the property and continued development. Their intention was to expand on the previous work of Biron Bay Resources and to “in fill” the drill intercepts of that 1990-90 project. They drove the decline to explore the drill intercepts of Biron Bay. The company completed 21 underground diamond drill holes. The Shooting Star drilling failed to establish horizontal continuity for the earlier drilling but did establish that high grade mineralization over economically viable widths was present. They concluded that the prospect would not support a conventional mine-mill operation.

The work by these two companies has demonstrated that, although the vein is not consistently mineralized enough to support a large-scale operation, there are numerous lenses and pockets of high-grade rock that could be profitably extracted by careful development and mining and the Company will be engaging a specialist in connection with the construction of its mill in order to maximize the yield.

Exploration Status

We have not established that our Billali Mine and Jim Crow Mine rights contain proven or probable reserves, as defined under Reg. S-K 1300. The Company has conducted a limited amount of exploration work on the Jim Crow mine to date. The Company commenced work at the Jim Crow mine in late 2019. Work to date has consisted of upgrading the surface facilities, rehabilitating the shaft, expanding the hoisting capability and underground excavation on three levels and a crushing plant site was purchased on January 1, 2020, in Duncan, Arizona. We

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have extracted approximately 2,000 tons of ore that is sitting on our property awaiting further processing and analysis. The Company currently has its crushing equipment on this site and engaged a specialist firm in Colorado to analyze our ore and prepare a process and plan with the optimal equipment, methods, chemical reagents that will allow us to realize the maximum yield from our ore. We understand that this will cost around $40,000 and we have engaged the firm. We received the report in late September 2021. This is the first step needed for the construction of our mill and we will have the detailed plan of what will be required and we can then begin construction, purchasing the necessary equipment and chemical reagents that are called for. The Company believes that the total cost without labor will be around $1,000,000. It will need to secure these funds in order to engage the specialist, to begin construction and to purchase the equipment and materials necessary in order to have the mill operational, of which there can be no assurance.

The Company will need to conduct further work on the mine properties for sustained production. Such work will consist of exploration drilling from the surface and underground. The Company will continue to be considered an exploration stage property until it has disclosed reserves and once it has disclosed reserves it will be considered a development stage. Further work to be done includes drifting, raising and slope development, as well as further improvement of the surface facilities. As previously stated, we plan to construct a processing mill at the crushing site in Duncan, Arizona following the completion of the site plan by a specialty engineering firm we have selected. Additional equipment will be needed to be purchased or leased to complete the mill site. The Company currently lacks the capital to fund these expenditures and will need to raise the required funds through equity funding and/or a financing facility.

Current Billali Exploration and Status

Exploration and development work done in the 1990’s and in the 2011-14 time period suggest there are potentially mineable pipe-like high grade zones with indications of vertical continuity distributed throughout the length of the property. These can be in any of the three or more veins that are presently identified within the approximately 350-foot-wide structural zone that makes up Billali vein zone.

Santa Fe is currently mining one of these gold-silver bearing pipe-like bodies that has recently been discovered approximately 180 feet from the portal. Certain long hole drilling in the overlying Hoover Tunnel some 70 feet above suggests that this zone is continuous for at least that far, although we have not conducted any exploration in this area to date. The mined high silica vein rock is being stockpiled and will be tested by the specialists we intend to engage for our mill design. Initially we had planned to send a trial shipment to a nearby smelter pending the aggregation of 500 tons and assuming it was accepted and we were able to execute an acceptable contract with the smelter.  Since that smelter is no longer accepting outside ore and it currently is not cost effective to send our ore to another smelter for initial processing, we have determined that we will need to construct a mill to process our ore into concentrate in order for shipping to become cost effective. Whether we are able to sell to our smelter as initially planned or we construct a mill, the Company intends to mine on three levels approximately 100 vertical feet apart. These levels will crosscut the entire vein zone and the veins will be developed by a series of lateral workings from these crosscuts.  

Power and Water

The Company will be required to use water from the mine, to be stored in a water tank to be placed on the property, for its water source.  It is believed that this water will be sufficient for any development purposes. The Company will be required to place a generator on the property for electricity.

Development Plans

Santa Fe Gold believes that a profitable operation can be established and sustained in the Steeple Rock district by careful development and mining the high silica, gold and silver bearing vein rock thought to be present in both the Jim Crow and Billali mines, although we have not conducted any analytical work to demonstrate this. The district has a long record of producing high quality smelter flux ores that were previously directly shipped to a nearby copper smelter. Both the Jim Crow and Billali mines have well developed infrastructure with services in place. Both can be commissioned with relatively little development cost and continued maintenance. We have extracted ore from the Jim Crow mine recently and have been upgrading the Billali mine with the enhancements to make it ready for development and if successful, production. With the current COVID-19 situation and other unstated factors, the copper smelter the Company previously utilized is not accepting any outside material from any source. With some of our mine personnel contacting the COVID-19 virus, we have ceased extracting ore until we can develop our alternative business plan and finance its implementation. With the current situation, we need to advance our business plan by approximately one year referencing the design and construction of a mine-mill complex in Duncan, Arizona. This site will service both the Company’s property sites in the Steeple Rock mining district and the Black Hawk mining district. The Company will need to raise or finance the design and construction of the mill complex. The Company’s future revenue is contingent on the construction of a mill complex. The mill complex will require us to raise financing in order for it to be constructed and beginning ramp-up operations. The Company’s plan for operations is reliant on our ability to secure the financing required to construct and operate the mill-complex and continue mining operations. No assurances can be made that the Company will be successful in securing this needed financing or that if it is able to, that it will be on terms acceptable to the Company.

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Description of Black Hawk Project

Property Location and Access

The Black Hawk district, also called the Bullard’s Peak district in some references, is located approximately 15 miles west-southwest of Silver City New Mexico. Santa Fe Gold Corp. owns 13 patented and 82 unpatented mining claims covering approximately 72% of the known extent of the district. This property includes four of the five mines with recorded production among which are the two largest, the Black Hawk and the Alhambra. The property is reached by truck on a private dirt road that turns left off a paved highway, which access road is approximately 15 miles west-southwest of Silver City.  The claims are all located within approximately 1,900 acres.

 

Property Description

The Black Hawk district, sometimes referred to as the Bullard Peak district, is located in Grant County, New Mexico, approximately 15 miles by road west of Silver City, New Mexico, the terminus of a branch line of the Atchison, Topeka and Santa Fe Railway. The district is in the northeastern foothills of the Big Burro Mountains at an altitude of approximately 5,450 to 6,150 feet. Scattered junipers, scrub oak, small pines, and brush cover the hillsides. Most of the district is drained by way of Black Hawk Canyon which bisects the area and flows northward to Mangas Creek, but the eastern part is drained by tributaries of Silver Dale Creek, which flows northeastward to Mangas Creek. Mangas Creek flows into the Gila River about 9 miles northwest of the mouth of Black Hawk Canyon. The ore in the Black Hawk district appears to be controlled by rock lithology, with the host rock being a coarse-grained quartz diorite. Vein boundaries are sharp and the vein filings are generally recognizable visually. Mineral property claims are as follows:

Patented Lode Claims

	Name	MS No.
1	Alhambra Lode	MS 869
2	Kent County Lode	MS 778
3	Blackhawk Lode	MS 364A
4	Butternut Lode	MS 546
5	Little Rody Lode	MS 365A
6	Extension Lode	MS 772
7	Pumpkin Lode	MS 548
8	Silver Glance Lode	MS 366A
9	Good Hope Lode	MS 480

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10	Chicago Lode	MS 771
11	Surprise Lode	MS 367A
12	Cornicopia Lode	MS 770
13	Stonewall Lode	MS 547

Unpatented Lode Claims

	Name	BLM Serial Number
1	Alhambra Extension – Lode	NMMC 50356
2	Easy Days – Lode	NMMC 50357
3	Old Hobson – Lode	NMMC 50358
4	Argentine No. 5 – Lode	NMMC 85992
5	Argentine No. 6 – Lode	NMMC 85993
6	Argentine No. 7 – Lode	NMMC 85994
7	Argentine No. 8 – Lode	NMMC 85995
8	Argentine No. 9 – Lode	NMMC 85996
9	Argentine No. 17 – Lode	NMMC 86004
10	Argentite #1 – Lode	NMMC 64721
11	Argentite #2 – Lode	NMMC 64722
12	Argentite #3 – Lode	NMMC 64723
13	Argentite #4 – Lode	NMMC 64724
14	Argentite #10 – Lode	NMMC 64725
15	Argentite #11 – Lode	NMMC 64726
16	Argentite #12 – Lode	NMMC 64727
17	Argentite #13 – Lode	NMMC 64728
18	Argentite #14 – Lode	NMMC 64729
19	Argentite #15 – Lode	NMMC 64730
20	Argentite #16 – Lode	NMMC 64731
21	Argentite #18 – Lode	NMMC 64732
22	Argentite #19 – Lode	NMMC 64733
23	Argentite #20 – Lode	NMMC 64734
24	Argentite #21 – Lode	NMMC 64735
25	Argentite #22 – Lode	NMMC 64736
26	Contention #1 – Lode	NMMC 64719
27	Contention #2 – Lode	NMMC 64720
28	No Show #1 – Lode	NMMC 106382
29	No Show #2 – Lode	NMMC 106383
30	No Show #3 – Lode	NMMC 106384
31	No Show #4 – Lode	NMMC 106385
32	No Show #5 – Lode	NMMC 106386
33	No Show #6 – Lode	NMMC 106387
34	No Show #7 – Lode	NMMC 106388
35	No Show #8 – Lode	NMMC 106389
36	No Show #9 – Lode	NMMC 106390
37	No Show #10 – Lode	NMMC 106391
38	No Show #11– Lode	NMMC 106392
39	No Show #12 – Lode	NMMC 106393
40	No Show #13 – Lode	NMMC 106394
41	No Show #14 – Lode	NMMC 106395
42	No Show #15 – Lode	NMMC 106396
43	No Show #16 – Lode	NMMC 106397
44	No Show #17 – Lode	NMMC 106398
45	No Show #18 – Lode	NMMC 106399
46	No Show #19 – Lode	NMMC 106400
47	No Show #20 – Lode	NMMC 106401

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48	Rhonda #1 – Lode	NMMC 106402
49	Rhonda #2 – Lode	NMMC 106403
50	Rhonda #3 – Lode	NMMC 106404
51	Rhonda #4 – Lode	NMMC 106405
52	Rhonda #5 – Lode	NMMC 106406
53	Rhonda #6 – Lode	NMMC 106407
54	Rhonda #7 – Lode	NMMC 106408
55	Rhonda #8 – Lode	NMMC 106409
56	Rhonda #9 – Lode	NMMC 106410
57	Rhonda #10 – Lode	NMMC 106411
58	Rhonda #11 – Lode	NMMC 106412
59	Rhonda #12 – Lode	NMMC 106413
60	Rhonda #13 – Lode	NMMC 106414
61	Rhonda #14 – Lode	NMMC 106415
62	Rhonda #15 – Lode	NMMC 106416
63	Rhonda #16 – Lode	NMMC 106417
64	Rhonda #17 – Lode	NMMC 106418
65	Rhonda #18 – Lode	NMMC 106419
66	Pec-II #1 – Lode	NMMC 106420
67	Barite – Lode	NMMC 109082
68	Barite No. 2 – Lode	NMMC 109083
69	Barite No. 3 – Lode	NMMC 109084
70	Jody #1 – Lode	NMMC 115276
71	Jody #2 – Lode	NMMC 115277
72	Jody #3 – Lode	NMMC 115278
73	Jody #4 – Lode	NMMC 115279
74	Jody #5 – Lode	NMMC 115280
75	Jody #7 – Lode	NMMC 115281
76	Jody #8 – Lode	NMMC 115282
77	Jody #9 – Lode	NMMC 115283
78	Jody #10 – Lode	NMMC 115284
79	Stonewall Surprise – Lode	NMMC 193678
80	Alhambra Extension 2 – Lode	NMMC 193679
81	No Show No. 21 – Lode	NMMC 193680

History and Prior Operations

The Black Hawk district was discovered in 1881 and was in production until the so called “silver panic” of 1893. Since its main productive period, ending in its closure in late 1893 or early 1894, there has been little activity in the Black Hawk district. One of the mines, the Black Hawk was reopened in 1917 and some development done in the upper levels. Both the Black Hawk and the Alhambra were reopened at different times in the 1950’s, 1960’s, and the 1970’s but no sustained development or production was achieved. There has been some trenching and surface Geochem work done at various times.  

Project Status and Exploration Activities

We have not established that our Black Hawk and Bullard Peak rights contain proven or probable reserves, as defined under Reg S-K 1300.  No exploration activities have commenced to date and no exploration costs have been incurred or paid. To date, 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 exploration work and it currently lacks firm commitment financing for any exploration activities.

The Company will need to prepare the property for exploration and drilling activities, including building infrastructure, installing facilities, and purchasing equipment. Future exploration drilling on any of our properties that consist of BLM land will require us to either file a Notice of Intent (NOI) or a Plan of Operations with the BLM, depending upon the amount of new surface disturbance that is planned. A Notice of Intent is required for planned surface activities that anticipate less than 5.0 acres of surface disturbance, and usually can be obtained within a 30 to 60-day time period. The Company currently lacks sufficient capital to fund these expenditures and is currently allocating working capital to the Jim Crow and Billali project.

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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.

Mineralization and Geology

Mineralization in the Black Hawk mining district consists of numerous narrow carbonate veins containing varying amounts of cobalt, nickel, silver, uranium, and arsenic. It is one of a well-known, but poorly understood, geologic type of mineral deposit generally called “five element veins”. They are also rich in uranium, nickel and, of interest today, cobalt. In the Black Hawk district, the host is a coarse-grained quartz diorite. Mining conditions within the veins are good. The lack of strong alteration results in stable walls requiring minimum support, only occasional faults or gouge zones require timber. Vein boundaries are sharp and the vein fillings are easily recognizable visually.

The Silver City quadrangle covers approximately 20,650 square kilometers chiefly in the southern basin and range province of Southwestern New Mexico and Southeastern Arizona. Bedrock of the ranges includes Precambrian igneous and metamorphic rocks, Paleozoic sedimentary rocks, Mesozoic igneous and sedimentary rocks, and Cenozoic igneous rocks. The intervening basins, which constitute about 65% of the quadrangle’s surface area, are filled with Late Cenozoic (Pliocene-Pleistocene) sedimentary deposits in places to depths of more than 1,000 meters. The geology of each range is generally different, and most rock units and pre-basin and range structures cannot be correlated across the basin areas. The principal hydrothermal ore-forming processes in the quadrangle are believed to be attributable to subduction-related events including complex eruptive systems during two distinct periods in the development of the western orogenic continental margin: (i) a medium-potassium calcium/alkaline volcanic arc system in late Cretaceous/early Tertiary time (the Laramide orogeny 80/50 million years ago); and (ii) a high-potassium calcium/alkaline volcano-plutonic arc system in middle Tertiary time (30/15 million years ago). The hydrothermal-magmatic vein and pegmatite type deposits are probably Precambrian in age and the syngenetic sedimentary and volcanic deposits range in age from Cambrian to late Tertiary (or younger).

Although there is some local variation in some of the districts, the five metal types of deposits in the Black Hawk district are fissure veins where the carbonate and the ore minerals fill open space caused by the fracturing. The ore generally occurs in small high-grade pods or shoots randomly distributed within the fracture zone. The location of these open spaces is the sole recognized control of ore distribution. The favorability of the host seems to be governed by its fracturing characteristics rather than any chemical factor. Generally, in these deposits there is one favored rock type that accounts for most of the production. At the Black Hawk district, the preferred host rock is the coarse-grained quartz diorite.

The project requires further evaluation of its mineralogical makeup and economic modeling to determine the appropriate course for any potential future development and production. The Company has not conducted a preliminary feasibility study for the project at the time of filing this Registration Statement. Upon completion of the preliminary feasibility study for the project, the Company will prepare an impairment analysis of the project to determine if an impairment is required at that time.

Power and Water

The Company will be required to use water from the mine. Water will be pumped from a mine using one or more electric pumps powered by one or more on-site generators we place on site. Water will be stored in an on-site water tank we will place on site for use in processing. We believe that the water we collect from will be sufficient for exploration, development and production purposes. The Company will be required to place a generator on the property for electricity required to run the water pumps and for other purposes.

REGULATION S-K 1300 DEFINITIONS 

The following definitions are taken from Regulation S-K 1300 which goes into effect in the First Fiscal Quarter of Operations for the Company’s Fiscal year 2022. Previously the Company made disclosures in compliance with Industry Guide 7 for the mining industry entitled “Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations” contained in the Securities Act Industry Guides published by the United States Securities and Exchange Commission, as amended. There are a number of definitional changes. The following terms have the definitions set opposite them under Regulation S-K 1300:

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Exploration Stage Property	The term “exploration stage property” is a property that has no mineral reserves disclosed.
Development Stage Property	The term “development stage property” is a property that has mineral reserves disclosed, pursuant to …[the definition in Reg S-K 1300], but no material extraction.
Inferred Mineral Resource	The term “inferred mineral resource” is that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. The level of geological uncertainty associated with an inferred mineral resource is too high to apply relevant technical and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability. Because an inferred mineral resource has the lowest level of geological confidence of all mineral resources, which prevents the application of the modifying factors in a manner useful for evaluation of economic viability, an inferred mineral resource may not be considered when assessing the economic viability of a mining project, and may not be converted to a mineral reserve.
Mineral Reserves	The term “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. More specifically, it is the economically mineable part of a measured or indicated mineral resource, which includes diluting materials and allowances for losses that may occur when the material is mined or extracted
Mineral Resource	The term “mineral resource” is a concentration or occurrence of material of economic interest in or on the Earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction. A mineral resource is a reasonable estimate of mineralization, taking into account relevant factors such as cut-off grade, likely mining dimensions, location or continuity, that, with the assumed and justifiable technical and economic conditions, is likely to, in whole or in part, become economically extractable. It is not merely an inventory of all mineralization drilled or sampled.
Probable Mineral Reserve	The term “probable mineral reserve” is the economically mineable part of an indicated and, in some cases, a measured mineral resource.
Production Stage Property	The term “production stage property” is a property with material extraction of mineral reserves.
Proven Mineral Reserve	The term “proven mineral reserve” is the economically mineable part of a measured mineral resource and can only result from conversion of a measured mineral resource.
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Qualified Person	The term “qualified person” is an individual who is:
	(1) A mineral industry professional with at least five years of relevant experience in the type of mineralization and type of deposit under consideration and in the specific type of activity that person is undertaking on behalf of the registrant; and
	(2) An eligible member or licensee in good standing of a recognized professional organization at the time the technical report is prepared. For an organization to be a recognized professional organization, it must:
	(i) Be either:
	(A) An organization recognized within the mining industry as a reputable professional association; or
	(B) A board authorized by U.S. federal, state or foreign statute to regulate professionals in the mining, geoscience or related field;
	(ii) Admit eligible members primarily on the basis of their academic qualifications and experience;
	(iii) Establish and require compliance with professional standards of competence and ethics;
	(iv) Require or encourage continuing professional development;
	(v) Have and apply disciplinary powers, including the power to suspend or expel a member regardless of where the member practices or resides; and
	(vi) Provide a public list of members in good standing.
	Relevant experience means, for purposes of determining whether a party is a qualified person, that the party has experience in the specific type of activity that the person is undertaking on behalf of the registrant. If the qualified person is preparing or supervising the preparation of a technical report concerning exploration results, the relevant experience must be in exploration. If the qualified person is estimating, or supervising the estimation of mineral resources, the relevant experience must be in the estimation, assessment and evaluation of mineral resources and associated technical and economic factors likely to influence the prospect of economic extraction. If the qualified person is estimating, or supervising the estimation of mineral reserves, the relevant experience must be in engineering and other disciplines required for the estimation, assessment, evaluation and economic extraction of mineral reserves.
	(1) Relevant experience also means, for purposes of determining whether a party is a qualified person, that the party has experience evaluating the specific type of mineral deposit under consideration (e.g., coal, metal, base metal, industrial mineral, or mineral brine). The type of experience necessary to qualify as relevant is a facts and circumstances determination. For example, experience in a high-nugget, vein-type mineralization such as tin or tungsten would likely be relevant experience for estimating mineral resources for vein-gold mineralization, whereas experience in a low grade disseminated gold deposit likely would not be relevant.
	Note 1 to paragraph (1) of the definition of relevant experience: It is not always necessary for a person to have five years' experience in each and every type of deposit in order to be an eligible qualified person if that person has relevant experience in similar deposit types. For example, a person with 20 years' experience in estimating mineral resources for a variety of metalliferous hard-rock deposit types may not require as much as five years of specific experience in porphyry-copper deposits to act as a qualified person. Relevant experience in the other deposit types could count towards the experience in relation to porphyry-copper deposits.
	(2) For a qualified person providing a technical report for exploration results or mineral resource estimates, relevant experience also requires, in addition to experience in the type of mineralization, sufficient experience with the sampling and analytical techniques, as well as extraction and processing techniques, relevant to the mineral deposit under consideration. Sufficient experience means that level of experience necessary to be able to identify, with substantial confidence, problems that could affect the reliability of data and issues associated with processing.
	(3) For a qualified person applying the modifying factors, as defined by this section, to convert mineral resources to mineral reserves, relevant experience also requires:
	(i) Sufficient knowledge and experience in the application of these factors to the mineral deposit under consideration; and
	(ii) Experience with the geology, geostatistics, mining, extraction and processing that is applicable to the type of mineral and mining under consideration.

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The SEC is replacing its disclosure requirements for mining companies and replacing Industry Guide 7 with Regulation S-K 1300 et. seq. This new disclosure goes into effect for the Company beginning with the first quarter of our fiscal year beginning July 1, 2021. Because of this, some of the financial information contained in this Registration Statement was prepared when Industry Guide 7 was in effect and only our interim periods would require adoption of Regulation S-K 1300, , we have opted to adopt the Regulation. S-K 1300 disclosure format for the disclosure in this Registration Statement filed on Form 10 with the Commission. Prospectively, we will be required to file our annual reports aligned to S-K 1300 requirements. The 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. Industry Guide 7 will remain effective until all registrants are required to comply with the rules, at which time Industry Guide 7 will be rescinded. Note that under Reg. S-K 1300, there is a greater focus on “materiality” and integrity or quality of information. The concept of a “qualified person” is added where there are results of exploration disclosed in terms of quantified mineral content and the various reports with the prescribed content required in each, every technical report referenced under Regulation. S-K 1300 must be prepared by a qualified person. Thus, where previously we could have disclosed certain limited exploration results that we were able to secure from the prior owner of a property in which we now have mining interests, where the data was incomplete and yet the prior owner’s notes did have the gold and silver content listed per ton at various drill holes listed, where that information was purported to have come from a report prepared in a large exploration program of the area where the property is situated, however under Regulation S-K 1300 we may not disclose that information if it was not based on work prepared by a qualified person. Without a way to determine that the reports, summary technical report or property disclosure was prepared by a qualified person, as defined in Regulation S-K 1300. Under Item 1302(a)(1) of Regulation S-K 1300, we may disclose historical information in technical reports, property disclosures and other summaries of work, provided it is based on the work of a qualified person. However, since it is from the prior owner’s notes and those notes were incomplete and there isn’t a way to determine conclusively if it was based on the work of a qualified person, we have determined that the information may not be disclosed.

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Item 4. Security Ownership of Certain Beneficial Owners and Management.

Principal Stockholders

The following table sets forth information regarding the beneficial ownership of our common stock as of March 31, 2022, according to the information we have received, that we were beneficially owned by (1) each stockholder who is known by us to beneficially own more than 5% of our common stock, (2) each of our directors, (3) each of our executive officers, and (4) all of our directors and executive officers as a group. Unless otherwise indicated, the persons named in the table below have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable. The address of our directors and executive officers is our address.

	Common Stock
Name and Address of Beneficial Owner	Shares	Percent of Class (1)
5% Stockholders
Boonyin Investments (4) New Australia	69,936,590	16.00%
Sulane Holdings (5)	23,207,360	5.31%
Switzerland
Michael Musulin (2) Scottsdale, Arizona	36,373,504	8.12%
Directors and Executive Officers
Brian Adair (3)	59,515,026	13.04%
Stephen J. Antol	2,900,000	*
Current officers and directors as a group (2 persons)	62,415,026	13.68%

*Less than 1% 

(1)Applicable percentage of ownership is based on 440,248,551 shares of common stock issued and outstanding as of March 31, 2022 for each stockholder. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock subject to options or warrants exercisable or convertible into shares of common stock that are currently exercisable or exercisable within sixty (60) days of March 31, 2022 are deemed to be beneficially owned by the person holding such options or warrants for the purpose of computing the percentage of ownership of such person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. 

(2)Includes (i) 2,500,000 shares issuable upon exercise of warrants that are currently exercisable and (ii) 8,000,000 options that are currently exercisable, both within sixty days following March 31, 2022. The shares held include 1,500,000 shares held by Mrs. Musulin. 

(3)Mr. Adair is the acting Chief Executive Officer, Chairman of the Board, Audit Committee Chairman and a Director of the Company. Includes (i) 4,201,667 shares issuable upon exercise of warrants that are currently exercisable and (ii) 15,000,000 options that are currently exercisable, both within sixty days following March 31, 2022. 

(4)Boonyin Investments is controlled by Kok Kian Lim. 

(5)Sulane Holdings is controlled by Christian Mustad. 

Item 5. Directors and Executive Officers.

Our Board of Directors

The following table sets forth information regarding our current directors and each director nominee, as of March 31, 2022.

Name	Principal Occupation	Age	Date Elected
Brian Adair	Director	58	April 5, 2018
	Chairman of the Board, acting Chief Executive Officer		July 26, 2018
Stephen J. Antol	Chief Financial Officer, Secretary, Director	79	July 7, 2020

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Our Executive Officers

We designate persons serving in the following positions as our named executive officers: our chief executive officer, chief financial officer. The following table sets forth information regarding our executive officers as of March 31, 2022.

Name	Principal Occupation	Age	Officer Since
Brian Adair	Chairman of the Board, acting Chief Executive Officer	58	July 26, 2018
Stephen J Antol	Chief Financial Officer and Secretary	79	July 7, 2020

Brian Adair, earned his Bachelor’s degree in Business Administration from LaRoche College. He then continued his studies at Duquesne University to earn his Master’s degree. Brian’s vision to protecting and preserving personal wealth paved the way to establish Adair Financial Group in 2004, of which he has served as principal since inception.  Adair Financial Group is a comprehensive, solutions-driven firm, well known for high standards and business ethics. His client’s needs are addressed in a collaborative fashion by using the client’s advisory team of financial, legal and tax experts, often representing multiple generations of families. Adair Financial Group can handle any case regardless of the complexity and is unique in that the intellectual property is not reserved for just the ultra-wealthy client. Mr. Adair’s financial guidance and expertise is beneficial to the Company in his role as a director. Mr. Adair was nominated to the board by the current directors on April 5, 2018.

In 2012, the National Senior Market recognized Brian as a “Finalist for Advisor of the Year”. In addition, Mr. Adair was recently inducted into the “Top of the Table - Million Dollar Round Table” organization. This elite industry group recognizes top financial services professionals. His designation as the “Top of the Table” is only awarded to the top 1% of the top 1% of financial professionals – internationally.

Stephen J. Antol, has consulted with the Company since July 2005, prepared the federal and state income tax returns and assisted from in our financial closings and reporting. Mr. Antol, previously served as Chief Financial Officer from November 2004 to May 2007 and from April 2009 until current, for a small reporting precious metals company. For the period May 2007 to May 2009, and from late 1992 through November 2004, Mr. Antol rendered services as a consultant chief financial officer for a number of small and medium-size businesses, public and private companies requiring technical expertise on a limited or recurring basis. From 1990 to 1992, Mr. Antol served as Chief Financial Officer of Lou Register Furniture, a fine furniture retailer located in Phoenix, Arizona. From 1987 to 1990, Mr. Antol served as Director of Finance for F.S. Inc. (dba Audio Express and Country House Furniture), a retailer of furniture and stereo equipment in four southwestern states. From 1975 to 1987, Mr. Antol worked for Giant Industries, Inc., an independent refiner and marketer of petroleum products, in such capacities as Corporate Controller and Corporate Treasurer. Mr. Antol also has six years audit and tax experience with two major certified public accounting firms in Phoenix, Arizona. Mr. Antol received a Bachelor of Arts degree from Michigan State University in 1968, and became a licensed Certified Public Accountant in 1970 after meeting a two year resident requirement. He no longer practices as a licensed CPA. Mr. Antol was appointed a director by the Board on July 7, 2020.

Board members are elected to the board by the shareholders at the annual shareholders meeting or a new board member may be nominated to the board by current board members and are confirmed to the board by the shareholders at the next annual shareholder meeting. All board members at that time were confirmed at the last annual shareholder meeting in January 2019. Board members remain on the board until they retire from the board or are voted off by the shareholders.

Item 6. Executive Compensation.

Summary Compensation Table

Our primary objective for of our senior officer compensation is to attract, motivate and retain qualified officers to lead the Company in the pursuit of its business goals and combine strategic thinking, creative talent, and strict corporate governance in order to position the Company to capitalize on a wide variety of business opportunities without being limited by any single industry or platform.

Compensation for executive officers is based upon their individual employment contracts with such base salary and annual bonuses as may be determined by the Compensation Committee, from time to time, payable in accordance with the regular practices of the Company. We have not adopted an Option Plan as of the date of this Registration statement however we intend to adopt and equity-based incentive plan in the future. Historically we have simply made grants of restricted common stock or unqualified options in lieu of qualified options.

The following table sets forth information concerning the compensation of our principal executive officer, our principal financial officer and each of our other executive officers during the current fiscal years 2021 and 2020.

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Name and Principal Position	Year		Salary ($)		Bonus ($)		Stock Awards ($)		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)
Frank Mueller, CFO		2020		150,000		—		—		—		—			150,000
Brian Adair, CEO		2022		300,000		—		—		—		—		300,000
Board Chairman		2021		300,000		—		—		—		—		300,000
		2020		75,000		—		—		—		—		75,000
Steve Antol		2022		150,000		—		—		—		—		150,000
CFO		2021		150,000		—		—		—		—		150,000

Employment Agreements

Effective July 7, 2020, the Company retained a new Chief Financial Officer and the prior Chief Financial Officer was reassigned to oversee all mining operations as they come on line in our fiscal 2021-2022 years. Both parties signed a one-year employment agreement with the Company, with automatic successive one-year renewals provided that neither party has provided notice of termination prior to 30 days from the end of such applicable term. Both employment agreements are in effect at the time of filing this Form 10.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Santa Fe Gold Corporation has had no disagreements with its accountants on accounting and financial disclosure.

CERTAIN TRANSACTIONS

Other than as described herein, none of our directors or executive officers, nor any person who beneficially owns, directly or indirectly, shares carrying more than five percent of the voting rights attached to all of our outstanding shares, nor any members of the immediate family (including spouse, parents, children, siblings, and in- laws) of any of the foregoing persons has any material interest, direct or indirect, in any transaction over the last three years or in any presently proposed transaction which, in either case, has or will materially affect us.

Item 7. Certain Relationships and Related Transactions.

Since August 2015, the Company has leased a home office space from Mr. Mueller for $550 a month for the corporate administrative office in Albuquerque, NM. Rental expense was $6,600 for fiscal years ended June 30, 2021,  2020 and 2019, respectively.

Since July 2019, Nataliia Mueller, wife of Mr. Mueller, has been paid an annual wage of $60,000 as an assistant to the CFO, in the areas of purchasing, payroll and accounts payable. Mrs. Mueller continues as the assistant to Mr. Antol, the current CFO, at her current annual compensation of $60,000.

During the fiscal year ended June 30, 2019, 15,000,000 options were granted to each of two directors for their efforts to revive the Company. The options have a five (5) year life and an exercise price of $0.05 per share the market value on the date of the grant and have a non-cash exercise provision. The Black-Sholes value of the issued options was $1,497,985.

During the fiscal year ended June 30, 2019, the former CFO for the Company loaned the Company $10,000 and deferred net salary aggregating $51,848 into a note at 6% per annum, At June 30, 2019, balance on the note and accrued interest on the note was $61,848 and $1,651, respectively, and the note has no stated due date. During fiscal 2020, the prior CFO made additional cash advances in the aggregate amount of $55,000 and deferred $25,189 of net salary and accrued interest on the obligation of $4,528 in fiscal 2020. During fiscal 2020 the CFO converted the debt and accrued interest to restricted common shares of the Company and the Company recorded a $36,286 non-cash loss on the conversion.

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 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.

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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 $809,534 in cash and properties with an estimated net market value of approximately $209,800 as of the date of filing of this Form 10.

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 any additional substantial reimbursement of the remaining expenses that were incurred as a result of Laws malfeasance after the sale of the remaining properties received from the court.

Item 8. Legal Proceedings.

Boart Longyear Company v. Lordsburg Mining Company, Case No. D-2-2-CV-2015- 06048, County of Bernalillo, NM; Boart Longyear Company v. Lordsburg Mining Company, Case No. D-721-CV-2015- 00058, County of Sierra, NM; and Boart Longyear Company v. Lordsburg Mining Company, Case No. D-608-CV- 201500165, County of Quintero, NM.  There are a series of collection cases by Boart Longyear Company, a company that obtained Utah judgments for equipment delivered to Lordsburg Mining Company in the aggregate amounts of $158,480 and has an interest rate of 5.25% per annum. Accrued interest on the obligation at June 30, 2021, 2020 and 2019 was $45,002, $36,682 and $28,339 respectively. Interest expense on the obligation for the fiscal years ended June 30, 2021, 2020 and 2019 was $8,320, 8,320 and $8,321, respectively.

Wagner Equipment Co. v. Lordsburg Mining Company, Case No. D-2014-02372, County of Bernalillo, NM 28 is a collection case by Wagner equipment, who obtained judgment for equipment delivered to Lordsburg Mining Company in the amount of $115,789 and has a rate of interest of 8.75% per annum. Accrued interest on the obligation at June 30, 2021, 2020 and 2019 was $67,862 and $57,731 and $47,571, respectively. Interest on the obligation for the fiscal years ended June 30, 2021, 2020 and 2019 was $10,132, $10,159 and $10,132, respectively.

The bankruptcy court set up a Trust fund that will be funded by the activities of the Summit mine for five (5) years after reopening of the mine and the trust funds will be distributed by an independent trustee to all credit holders on record.  Currently all debts at the time of the bankruptcy are currently due and in default. None of the claims have been reopened since June 2016.

On November 30, 2017, the Company entered into substantially identical agreements with Fortune Graphite, Inc. and Worldwide Graphite Producers, Ltd. to acquire a total of four placer claims for aggregate consideration of Can$400,000 and the issuance of 10,000,000 shares of Company common stock.  Title to these claims remains in trust with the sellers until payment is made in full. To date, the Company has paid Can$260,000.  The Company owes the sellers Can$140,000 and 10,000,000 shares of Company common stock under the agreement. Based upon our additional information that came to light and our subsequent scrutiny and analysis of the transaction, the Company, in February 2019, initiated an arbitration proceeding against the seller to void and rescind the purchase of these British Columbia properties. In addition to voiding and rescission, the Company is seeking additional remedies. In October 2020, the arbitrator ruled in favor of the Company and the 10,000,000 shares reserved under the agreements have been nullified. In connection with this arbitration, the Company’s legal position was to void the transaction and, due to the uncertainty of the outcome, has provided an impairment at June 30, 2019 in the amount of $210,116. A deposit of $54,000 was made by the seller for the arbitration and the arbitrator will determine the distribution of this amount. The Company has filed with the arbitrator for reimbursement of all legal costs associated with the arbitration and any other amounts to be awarded. In February 2021, the Company was awarded approximately $53,000, and after payment of legal fees, received net proceeds of approximately $4,500.

The U.S. Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) each initiated investigations into the Company, its officers, directors, and potentially others, resulting from the Laws transactions. The SEC has obtained a formal order to investigate the Company with respect to Laws, and while we understand that the DOJ investigation led to Mr. Laws plea of guilty to various charges, including charges based on his actions alleged by the Company. Mr. Laws has signed a settlement agreement with the SEC. None of funds that Mr. Laws owes the Company were ever received or benefited by anyone other than Mr. Laws, nor was there ever any evidence found (after a forensic review of the Company’s books and records by an independent forensic accounting firm) that anyone else benefited in any way from the Laws transaction(s). However, notwithstanding the forgoing, the SEC investigated this matter and although he did not benefit from or participate in the Laws misappropriation, determined that they would proceed against our Former Chief Financial Officer (notwithstanding the fact that he was the person that notified the SEC), he determined that it would be in his and the Company’s best interest if he were to settle the matter and bring closure to the investigation. Under the terms of the settlement, he was prohibited from serving as an officer or director of a publicly traded company for a period of five years and in addition was required to pay a fine.  The Company considers Mr. Mueller as an important asset of the Company with substantial depth of institutional knowledge of the Company and its position in the

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mining industry as well as the various players in the industry.  Without this knowledge the Company would be at a substantial disadvantage and as such, rather than terminate him or allow him to resign, we determined that we would reassign him to mining operations if he was willing to serve in that capacity. Because he remained with the Company, we developed a protocol and scope of responsibility to meet the requirements of his settlement with the SEC and fully disclosed the protocol and scope of responsibility to the SEC Staff that had negotiated the settlement agreement. Thus, his continuing roll with the Company has been reviewed by SEC staff who approved of his continuing roll, provided that the Company follow it.

In April 2021, the Company was served with a complaint in the State of Florida by Euro Bentley Advisors, LLC (“EBA”) for the sum of $120,000 based on the alleged breach of contract between the Company and EBA. The Company has settled this litigation in the amount of $100,000 and has paid $30,000 against this obligation in our quarter ending December 2021.

Item 9. Market Price of, and Dividends on, the Registrant’s Common Equity and Related Stockholder Matters.

(a) Market Information

Prior to the Commission stop order on the trading of our common stock and became deregistered on December 17, 2020, our common stock traded on the OTC PINK Exchange under the ticker symbol “SFEG.” The following table sets forth, for the periods indicated, the high and low closing sales prices of our common stock:

	(U.S. $)
	HIGH	LOW
Fiscal 2021
Quarter ended September 30, 2020	0.0940	0.0480
Quarter ended December 31, 2020	0.0598	0.0300
Quarter ended March 31, 2021   Delisted	0.0000	0.0000
Quarter ended June 30, 2021      Delisted	0.0000	0.0000
Fiscal 2020
Quarter ended September 30, 2019	0.0745	0.0650
Quarter ended December 31, 2019	0.0950	0.0401
Quarter ended March 31, 2020	0.0800	0.0410
Quarter ended June 30, 2020	0.0860	0.0300

(b) Holders

There were approximately 858 record shareholders of record of the Company’s Common Stock as of June 30, 2021.

(c) Dividends

The Company has never declared or paid any cash dividends. It is the present policy of the Company to retain earnings to finance the growth and development of the business and, therefore, the Company does not anticipate paying dividends on its Common Stock in the foreseeable future.

(d) Equity Compensation Plan Information

The Company does not currently have an equity compensation plan but intends to adopt one in the future. In lieu of an equity compensation plan the Company has granted shares of restricted stock and unqualified options to purchase shares of our common stock to its officers, directors and others for services periodically.

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Item 10. Recent Sales of Unregistered Securities.

Unless otherwise indicated below, the following securities were offered and sold by the Company in reliance upon exemptions from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (“Securities Act”) and, with respect to foreign investors, Regulation S promulgated under the Securities Act. In connection with transactions referenced below, other than issuances to the Company’s officers, directors, employees and consultants for services, the Company obtained representations that (i) such investor was an “accredited investor” within the meaning of Rule 501 of Regulation D, (ii) such investor was acquiring the securities for its own account for investment and not for the account of any other person and not with a view to or for distribution, assignment or resale in connection with any distribution within the meaning of the Securities Act, (iii) such investor understands that the purchased securities or shares underlying such securities are subject to transfer restrictions under the Securities Act and any applicable state securities laws, (iv) such investor has knowledge and experience in financial and business matters such that such investor is capable of evaluating the merits and risks of an investment in us, and (v) such investor has considered the risk factors contained in SEC filings. In connection with sales of our equity securities for cash between July 2016 through August 2018, an aggregate of $705,042 cash was paid as finders fees on sales to existing shareholders who had already made their purchase decisions prior to purchasing. These sales were made fees paid in a manner consistent with the SEC’s Paul Anka No Action Letter (Issued July 24, 1991). That is, (a) the finder did not have involvement in negotiating or structuring transactions with investors (they had already made the decisions to purchase based on their own criteria, no sales material was provided by the finder with the sole exception of a blank subscription agreement that the finder was provided by the Company and that was provided along with the per share price to the investor as a courtesy); (b) the finder did not value or opine as to the Company’s common stock’s value and did not participate in negotiating on behalf of the investor or the Company; (c) the finder was not in the business of brokering transactions and its activity, as a finder, was isolated to helping the Company and (d) although fees were paid in connection with the sales of the Company’s common stock, this was disclosed on the subscription agreements and the other items were as limited or more limited than those that were present that gave rise to the SEC’s Paul Anka No-Action Letter. (Id.) Further, not only did the investors have a pre-existing relationship with the finder but in the Anka No-Action Letter none of the prospective investors was an existing shareholder. No commissions or finder’s fees were paid in connection with the placement of common stock subsequent to August 2018.

During the Company’s 2021, 2020 and 2019 fiscal years ending June 30, the Company received proceeds from the sale of shares of its Common Stock of $929,000, $2,080,000 and $1,661,980, 1respectively. A total of 15,366,668 shares were sold during fiscal 2021 at a discount to the market price at an average price per share of $0.025 per share, for average prices ranging between $0.094 and $0.030 per share.  A total of 32,452,381 shares were sold during fiscal 2020 at a discount to the market prices at an average price per share of $0.0142 per share, for average prices ranging between $0.0839 and $0.0411 per share. A total of 25,399,720 shares were sold during fiscal 2019 at a discount to the market prices at an average price per share of $0.0129 per share, for average prices ranging between $0.105 and $0.05 per share. The shares sold and issued were shares of restricted Common Stock made in reliance upon the exemptions from registration provided by Section 4(2) of the Securities Act of 1933, and/or Rule 506 of Regulation D promulgated thereunder. The investors were “accredited investors” and/or “sophisticated investors” pursuant to Section 501(a) of the Securities Act, who provided the Company with representations, warranties and information concerning their qualifications as a “sophisticated investor” and/or “accredited investors.” The Company provided and made available, to the investors, full information regarding its business and operations. There was no general solicitation in connection with the offers or sales of the restricted securities. The investors acquired the restricted common stock for their own accounts, for investment purposes and not with a view to public resale or distribution thereof within the meaning of the Securities Act. The restricted shares so purchased cannot be sold unless pursuant to an effective registration statement by the Company, or by exemptions from registration requirements of Section 5 of the Securities Act—the existence of any such exemptions are subject to legal review and approval by the Company.

Item 11. Description of Registrant’s Securities to be Registered.

DESCRIPTION OF SECURITIES

The authorized capital stock of Santa Fe Gold Corporation consists of 550,000,000 shares of Common Stock, $0.002 par value per share (the “Common Stock”). As of June 30, 2021, there were 433,018,551 shares of Common Stock issued and outstanding and as of March 31, 2022, there were 440,248,551 shares of Common Stock issued and outstanding.

The following description of certain matters relating to Santa Fe Gold Corporation securities is a summary and is qualified in its entirety by the provisions of Santa Fe Gold Corporation Articles of Incorporation, the Amendments to the Articles of Incorporation and Bylaws.

Common Stock

The holders of our common stock are entitled to one vote per share on all matters submitted to a vote of our stockholders. The holders of the common stock have the sole right to vote, except as otherwise provided by law, or by our certificate of incorporation.

In addition, such holders are entitled to receive ratably such dividends, if any, as may be declared from time to time by our board of directors out of legally available funds. In the event of the dissolution, liquidation or winding up of Santa Fe Gold Corporation, the holders of our common stock are entitled to share ratably in all assets remaining after payment of all our liabilities.

57

The holders of the common stock do not have cumulative voting rights or preemptive rights to acquire or subscribe for additional, unissued or treasury shares in accordance with the laws of the State of Delaware. Accordingly, excluding any voting rights granted to any series of our preferred stock, the holders of more than 50 percent of the issued and outstanding shares of the common stock voting for the election of directors can elect all of the directors if they choose to do so, and in such event, the holders of the remaining shares of the common stock voting for the election of the directors will be unable to elect any person or persons to the board of directors. All outstanding shares of the common stock are fully paid and nonassessable.

The laws of the State of Delaware provide that the affirmative vote of a majority of the holders of the outstanding shares of our common stock and any series of our preferred stock entitled to vote thereon is required to authorize any amendment to our articles of incorporation, any merger or consolidation of Santa Fe Gold Corporation with any corporation, or any liquidation or disposition of any substantial assets of Santa Fe Gold Corporation.

Warrants

At June 30, 2021 the Company had 12,865,483 warrants outstanding that are vested and exercisable. The warrants were issued in conjunction with restricted common stock purchases by accredited investors. At June 30, 2021, the warrants have a contractual remaining life of 1.73 years and a weighted average exercise price of $0.058.

Options

Santa Fe Gold Corporation has not issued any options or warrants to purchase shares of its common stock under a qualified option plan, although it plans to establish a qualified option plan at some point in the future. The Company has issued 30,000,000 non-qualified options at an exercise price of $0.05 and at June 30, 2021, have a contractual remaining life of 2.72 years.

Item 12. Indemnification of Directors and Officers.

Our certificate of incorporation provides to the fullest extent permitted by Delaware law, that our directors or officers shall not be personally liable to the Company or our stockholders for damages for breach of such director’s or officer’s fiduciary duty. The effect of this provision is to eliminate our rights and the rights of our stockholders (through stockholders’ derivative suits on behalf of the Company) to recover damages against a director or officer for breach of the fiduciary duty of care as a director or officer (including breaches resulting from negligent or grossly negligent behavior), except under certain situations defined by statute. We believe that the indemnification provisions in our certificate of incorporation are necessary to attract and retain qualified persons as directors and officers.

Delaware corporate law provides that a corporation may indemnify a director, officer, employee or agent made a party to an action by reason of that fact that he was a director, officer employee or agent of the corporation or was serving at the request of the corporation against expenses actually and reasonably incurred by him in connection with such action if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the corporation and with respect to any criminal action, had no reasonable cause to believe his conduct was unlawful.

Item 13. Financial Statements and Supplementary Data.

The financial statements required to be included in this registration statement appear at the end of the registration statement beginning on page F-1. (See Item 15).

Item 14. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

There are not and have not been any disagreements between us and our accountants on any matter of accounting principles, practices or financial statement disclosure.

Item 15. Financial Statements and Exhibits.

(a) Financial Statements

See the financial statements annexed to this Registration Statement which financial statements are incorporated herein by  reference.

58

(b) Exhibits

See below.

The following documents are filed as exhibits hereto:

Exhibit Number	Exhibit Description
3.1	AZCO Original Certificate of Incorporation.
3.2	Amendment of Certificate of Incorporation dated 7/27/2007.
3.3	Amendment of Certificate of Incorporation dated 6/02/2011.
3.4	Amendment of Certificate of Incorporation dated 1/21/2019, as currently in effect.
3.5	AZCO Mining original By-laws, as currently in effect.
4.1	Form of Subscription Agreement of the Company
4.2	Form of Warrant Agreement of the Company
10.1	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement
10.2	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement, Amendment 1.
10.3	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement, Amendment 2.
10.4	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement, Amendment 3.
10.5	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement, Amendment 4.
10.6	Billali Mine, LLC and JC Imperial, LLC Purchase Agreement, Amendment 5.
10.7	Thomas Property Lease Purchase Agreement.
10.8	Director Agreement, dated as of November 3, 2020, by a between Brian Adair and Santa Fe Gold Corporation.
10.9	Consulting Agreement, dated July 7, 2020, by and between Stephen Antol and Santa Fe Gold Corporation.
10.10	Employment Agreement, dated July 7, 2020, by and between Frank Mueller and Santa Fe Gold Corporation.
10.11	Alhambra Purchase Agreement
10.12	Alhambra Purchase Agreement – Amendment 1
10.13	Alhambra Purchase Agreement – Amendment 2
10.14	Alhambra Purchase Agreement – Amendment 3
15.1
21.1	Subsidiaries of Santa Fe Gold Corporation.
23.1	Consent of TAAD, LLP, independent registered public accounting firm.

59

Santa Fe Gold Corporation
Index to Consolidated Financial Statements

Fiscal Years Ended June 30, 2021, 2020 (Restated) and 2019 (Restated):
Independent Auditors’ Report	F-2
Consolidated Financial Statements
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations	F-4
Consolidated Statements of Stockholders’ Deficit	F-5
Consolidated Statements of Cash Flows	F-6
Notes to Consolidated Financial Statements	F-8 – F-30
Nine Months Ended March 31, 2022 and 2021 (Unaudited):
Consolidated Financial Statements
Cautionary Statement	F-31 – F-32
Consolidated Balance Sheets as of March 31, 2022 and June 30, 2021	F-33
Consolidated Statements of Operations for the three and nine months ended March 31, 2022 and 2021	F-34
Consolidated Statements of Stockholders’ Deficit for the nine months ending March 31, 2022 and 2021	F-35
Consolidated Statements of Cash Flows for the nine months ended March 31, 2022 and 2021	F-36
Notes to Consolidated Financial Statements	F-37 – F-52

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Santa Fe Gold Corp.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Santa Fe Gold Corp. (the “Company”) as of June 30, 2021, 2020 (as restated) and 2019 (as restated), the related consolidated statements of operations, stockholders’ deficit, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2021, 2020 (as restated) and 2019 (as restated), and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.

Restatement of Previously Issued Financial Statements

As discussed in Note 2 to the consolidated financial statements, the 2020 and 2019 consolidated financial statements have been restated to correct a misstatement.

Going Concern Matter

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations that raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

/s/ TAAD LLP

We have served as the Company’s auditor since 2018

Diamond Bar, California

June 13, 2022

F-2

SANTA FE GOLD CORPORATION

CONSOLIDATED BALANCE SHEETS

		Years Ended June 30,
					2020			2019
		2021			(Restated)			(Restated)
ASSETS
Current Assets:
Cash and cash equivalents	$	27,458		$	103,096		$	264,900
Prepaid expenses and other current assets		8,902			11,873			76,921
Total Current Assets		36,360			114,969			341,821
Property and equipment, net		287,403			333,089			25,543
Mineral properties		3,915,365			3,615,365			3,315,365
Finance lease right-of-use asset, net		17,098			35,370			—
Assets held for sale		247,800			—			—
Total Assets	$	4,504,026		$	4,098,793		$	3,682,729
LIABILITIES AND STOCKHOLDERS’ (DEFICIT)
Current Liabilities:
Accounts payable	$	3,742,933		$	3,662,040		$	3,151,035
Accrued liabilities		11,030,356			9,904,887			8,047,643
Notes payable, current portion		2,271,635			2,253,635			2,343,635
Note payable and accrued interest to related party		—			—			63,499
Finance lease payable		4,403			16,067			—
Completion guarantee payable		3,359,873			3,359,873			3,359,873
Total Current Liabilities		20,409,200			19,196,502			16,965,685
Long Term Debt:
PPP loans payable		109,883			225,067			—
Finance lease payable		—			5,839			—
Total Liabilities		20,519,083			19,427,408			16,965,685
Commitments and Contingencies
Stockholders’ Deficit:
Common stock, $0.002 par value, 550,000,000 authorized, as of June 30, 2021, 2020 and 2019, respectively: 433,018,551, 415,957,718 and 379,775,217 shares issued and outstanding, June 30, 2021, 2020 and 2019 respectively		866,037			831,915			759,550
Additional paid in capital		95,759,064			94,399,116			91,943,704
Accumulated deficit		(112,640,158	)		(110,559,646	)		(105,986,210	)
Total Stockholders’ Deficit		(16,015,057	)		(15,328,615	)		(13,282,956	)
Total Liabilities and Stockholders’ Deficit	$	4,504,026		$	4,098,793		$	3,682,729

The accompanying notes are an integral part of the audited consolidated financial statements.

F-3

SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

	Years Ended June 30,
				2020			2019
	2021			(Restated)			(Restated)
Revenues, net	$	—		$	—		$	—
Operating Expenses:
Exploration and mine related	546,895			1,005,726			174,329
General and administrative	1,662,022			1,609,708			2,669,351
Loss on asset disposition	1,836			—			—
Impairment of mineral lease deposits	—			—			210,116
Total Operating Expenses	2,210,753			2,615,434			3,053,796
Loss From Operations	(2,210,753		)	(2,615,434		)	(3,053,796		)
Other Income and (Expense):
Gain (loss) on debt extinguishment	226,367			—			112,625
Recovery (misappropriation) of funds	533,890			27,539			458,427
Miscellaneous income	2			7			638
Financing costs-commodity supply agreement	18,360			(1,331,946		)	(588,082		)
Interest expense	(648,378		)	(653,602		)	(902,648		)
Total Other income (Expense)	130,241			(1,958,002		)	(919,040		)
Income (Loss) Before Income Taxes	(2,080,512		)	(4,573,436		)	(3,972,836		)
Provision for Income Taxes	—			—			—
Net Income (Loss)	$	(2,080,512	)	$	(4,573,436	)	$	(3,972,836	)
Basic and Diluted Per Share Data:
Net (Loss) Per Share - basic and diluted	$	0.00		$	(0.015	)	$	0.00
Weighted-average Common shares Outstanding:
Basic and diluted	428,947,739			398,051,024			263,709,360

The accompanying notes are an integral part of the audited consolidated financial statements

F-4

SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

FOR THE YEARS ENDED JUNE 30, 2021, 2020 (Restated) AND 2019 (Restated)

					Additional
	Common Stock				Paid-In				Accumulated
	Shares		Amount		Capital				Deficit			Total
Balance, June 30, 2018		300,000,000	$	600,000	$	84,113,690			$	(102,013,374	)	$	(17,299,684	)
Common shares issued for consulting		3,057,035		6,114		285,494				—			291,608
Adair share valuation change		—		—		(124,200	)			—			(124,200	)
Adair loaned shares issued		18,000,000		36,000		1,854,000				—			1,890,000
Sale of common shares for cash		25,399,720		50,799		1,611,181				—			1,661,980
Issuance of subscribed stock		33,318,462		66,637		2,705,554				—			2,772,191
Value of warrants issued		—		—		1,497,985				—			1,497,985
Net loss		—		—		—				(3,972,836	)		(3,972,836	)
Balance, June 30, 2019 (Restated)		379,775,217	$	759,550	$	91,943,704		$		(105,986,210	)	$	(13,282,956	)
Common shares issued for consulting		765,821		1,531		61,533				—			63,064
Sale of common shares for cash		32,452,381		64,905		2,015,095				—			2,080,000
Conversion of debt and salary to equity		2,964,299		5,929		178,572				—			184,501
Value of warrants issued		—		—		200,212				—			200,212
Net loss		—		—		—				(4,573,436	)		(4,573,436	)
Balance June 30, 2020 (Restated)		415,957,718	$	831,915	$	94,399,116			$	(110,559,646	)	$	(15,328,615	)
Common shares issued for consulting		944,165		1,889		57,944				—			59,833
Sale of common shares for cash		15,366,668		30,733		898,267				—			929,000
Common shares issued for bonus award		750,000		1,500		43,500				—			45,000
Value of warrants issued		—		—		360,237				—			360,237
Net loss		—		—		—				(2,080,512	)		(2,080,512	)
Balance, June 30, 2021		433,018,551	$	866,037	$	95,759,064			$	(112,640,158	)	$	(16,015,057	)

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

F-5

SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended June 30,
				2020			2019
	2021			(Restated)			(Restated)
Operating Activities
Net income (loss)	$	(2,080,512	)	$	(4,573,436	)	$	(3,972,836	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Stock-based compensation	104,833			63,064			291,608
Warrant/option expense from derivative liability	360,237			200,212			1,497,985
Financing costs -commodity supply agreement	—			1,331,946			588,082
(Gain) on debt forgiveness	—			—			(112,625		)
(Gain) on PPP debt forgiveness	(226,367		)	—			—
Depreciation and amortization expense	67,076			45,990			—
Loss on debt conversion to equity	—			36,286			—
Loss on asset disposition	1,836			—			—
Impairment of mineral deposit	—			—			210,116
Valuation change as interest on loaned shares from related party	—			—			127,800
Non-cash recovery of misappropriated	(247,800		)	—			—
Non-cash interest expense	1,663			4,894			—
Changes in operating assets and liabilities:
Prepaid expenses and other assets	2,971			65,048			(65,241		)
Accounts payable and accrued expenses	1,206,362			1,036,303			743,444
Net cash used in by operating activities	(809,701		)	(1,789,693		)	(691,667		)
Investing Activities
Payments on mineral leases	(300,000		)	(300,000		)	(200,000		)
Purchase of property and equipment	(2,860		)	(344,401		)	(25,543		)
Deposit of mill design and engineering contract	(20,000		)	—			—
Refund of joint venture investment	—			—			25,000
Payments on mineral property purchase agreements	—			—			(615,365		)
Net cash used in investing activities	(322,860		)	(644,401		)	(815,908		)
Financing Activities
Proceeds from the issuance of common stock	929,000			2,080,000			1,661,980
Note payable proceeds	127,520			224,700			239,750
Loan proceeds from related parties	—			80,189			61,848
Insurance proceeds from truck loss	17,906			—			—
Payment on notes payable	—			(90,000		)	(210,000		)
Payment on property lease option	—			(15,000		)	—
Payment on lease principle	(17,503		)	(7,599		)	—
Net cash provided by financing activities	1,056,923			2,272,290			1,753.578
Net increase (decrease) in cash and cash equivalents	(75,638		)	(161,804		)	246,003
Cash and cash equivalents at beginning of year	103,096			264,900			18,897
Cash and cash equivalents at end of year	$	27,458		$	103,096		$	264,900

F-6

	Years Ended June 30,
		2020	2019
	2021	(Restated)	(Restated)
Supplemental cash flow disclosures:
Interest paid	$1,933	$1,401	$100,000
Income taxes paid	$-	$-	$-
Supplemental non-cash investing and financing activities:
Change in valuation on loaned shares from related party	$-	$-	$(124,200)
Conversion of debt and salary to equity	$-	$184,501	$-
Shares issue for bonus award	$45,000	$-	$-
Loaned shares returned to related party	$-	$-	$1,890,000

The accompanying notes are an integral part of the audited consolidated financial statements.

F-7

SANTA FE GOLD CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AS AT JUNE 30, 2021, 2020 (Restated) and 2019 ( Restated)

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 June 2022 and the Company has no current COVID-19 problems.

We are considered an “exploration stage” company under the U.S. Securities and Exchange Commission (“SEC”) Industry Guide 7. The  mining leases and other mineral rights we have control of, however, none of them contain any proven or probable reserves, as defined under SEC Guide 7. As such, they are all currently considered “exploratory” in nature. The SEC is replacing Guide 7 with S-K 1300. This new guide will go into effect for the Company beginning with our fiscal year beginning July 1, 2021. We will be required to file our annual reports 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. Industry Guide 7 will remain effective for other registrants until they all are required to comply with the new disclosure rules, at which time Industry Guide 7 will be rescinded. These notes to the consolidated financial statements of Santa Fe Gold Corporation relate to and have been prepared for under Industry Guide 7 since Regulation S-K 1300 et. seq. was not applicable to the Company in the reporting period to which they relate and the Company’s interim period ending September 30, 2021 are under Regulation S-K. Beginning on July 1, 2021 and thereafter the Company’s periodic reports filed with the Commission on Forms 10-Q and 10-K (and any Registration Statements) will be prepared in compliance with Regulation S-K 1300 et. seq.

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 be effectively contained, nor can we predict the severity and duration of its impact. If the outbreak of COVID-19 is 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 August or September 2022, depending on the projected completion of our mill operation in Duncan, Arizona.

F-8

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.

Restatement of Financial Statements for Fiscal 2019 and 2020

At the end of the Company’s fiscal year ending June 30, 2019, the Company initially wrote off debt and related accrued interest aggregating $12,507,540. The write off of debt was related to two finance facilities governed by and enforceable under British Columbia statutes. The Company retained legal services in British Columbia to research the British Columbia statutes of limitations on the collectability of the finance facilities. Legal counsel reviewed all related documents, records of proceedings and all records and documents deemed relevant to the two finance facilities. It was determined that the finance facilities were subject to the laws of the Providence of British Columbia and the National laws of Canada. The Company received a written legal opinion from Canadian counsel that any liability under the two finance facilities because of the Limitations Act (British Columbia) and the relevant case law in British Columbia, were no longer enforceable. That is, because the statute of limitations had run for the two finance facility liabilities pursuant to the Limitations Act (British Columbia), no future claims can be commenced in the Province of British Columbia and therefore, the Company has no outstanding legal obligation on the two finance facilities. With this decrease in our outstanding liabilities resulted in a one-time non-cash gain of $12,507,540 during the fiscal year ended June 30, 2019. In July 2021, the SEC disallowed the write off under the FASB Amendments to Subtopic 405-20, Derecognition 405-20-40-1. In this Form 10, the Company has restated the audited financial statements for the fiscal year ended June 30, 2019 to reflect required changes by the SEC and carried these changes through the other financial statements presented in this Form 10. The Company is currently pursuing the course of action required by the SEC to reinstate the write off of the herein referred to debt by obtaining the required FASB judicial ruling in Canada to justify the debt write off.

Restatement Effect on Financial Statements

The following table illustrates the impact of the restatement of unallowed debt written off in the restated audited consolidated balance sheet, the audited statement of operations and audited statement of cash flows for the fiscal years ended June 30, 2020 and 2019. Additional information is disclosed in the notes to the Consolidated Financial Statements(the “Notes”).

Effects on the previously issued financial statements referencing the disallowed debt write off are as follows:  

(A)Current accrued liabilities. 

(B)Current notes payable. 

(C)Change in working capital deficit. 

(D)Change in retained deficit. 

(E)Change in net shareholder deficit. 

(F)Change in net loss. 

		As Previously Reported		Adjustment		Restated
Consolidated Balance Sheet at June 30, 2019:
Cash		$	264,900	$	—	$	264,900
Prepaid expenses and other current assets		$	76,921	$	—	$	76,921
Total Current Assets		$	341,821	$	—	$	341,821
Mine Equipment, net		$	25,543	$	—	$	25,543
Mineral properties		$	3,315,365		—		3,315,365
Total Assets		$	3,682,729	$	—	$	3,682,729
Accounts payable		$	3,151,035	$	—	$	3,151,035
Accrued liabilities	A,C	$	645,068	$	—	$	645,068
Accrued interest – Tyhee loan	A,C	$	—	$	2,155,335	$	2,155,335
Accrued interest – Sandstorm completion guarantee payable	A,C	$	—	$	1,234,750	$	1,234,750
Accrued finance fee – Sandstorm commodity supply agreement	A,C	$	—	$	3,742,505	$	3,742,505
Accrued Tyhee finance fees	A,C	$	—	$	269,985	$	269,985
Notes payable, Tyhee loan principal - current portion	B,C	$	598,543	$	1,745,092	$	2,343,635

F-9

Note payable and accrued interest to related party		$	63,499		$	—		$	63,499
Sandstorm completion guarantee payable	C	$	—		$	3,359,873		$	3,359,873
Total Current Liabilities	C	$	4,458,145		$	12,507,540		$	16,965,685
Common stock		$	759,550		$	—		$	759,550
Additional paid in capital		$	91,943,704		$	—		$	91,943,704
Accumulated deficit	E	$	(93,478,670	)	$	(12,507,540	)	$	(105,986,210	)
Stockholders’ Deficit	E	$	(775,416	)	$	(12,507,540	)	$	(13,282,956	)
Total Liabilities and Stockholders’ Deficit		$	3,682,729		$			$	3,682,729
Consolidated Statement of Operations for the fiscal year ended June 30, 2019:
Exploration and mine related costs		$	174,329		$	—		$	174,329
General and administration		$	2,669,351		$	—		$	2,669,351
Impairment of mineral lease deposits		$	210,116		$	—		$	210,116
Total Operating Expenses		$	3,053,796		$	—		$	3,053,796
Gain on debt extinguishment	D,E,F	$	12,620,165		$	(12,507,540	)	$	112,625
Recovery of misappropriated funds		$	458,427		$	—		$	458,427
Miscellaneous income		$	638		$	—		$	638
Financing costs commodity supply agreement		$	(588,082	)	$	—		$	(588,082	)
Valuation change as interest on loaned shares from related party		$	(127,800	)	$	127,800		$	—
Interest expense	D,E,F	$	(774,848	)	$	(127,800	)	$	(902,648	)
Total Other Income and (Expense)		$	11,588,500		$	(12,507,540	)	$	(919,040(	)
Net Income (loss)	D,E,F	$	8,534,704		$	(12,507,540	)	$	(3,972,836	)
Consolidated Statement of Cash Flows for fiscal year ended June 30, 2019:
Net income (Loss)	D,E,F	$	8,534,704		$	(12,507,540	)	$	(3,972,836	)
Stock based compensation		$	291,608		$	—		$	291,608
Warrant/option expense from derivative liability		$	1,497,985		$	—		$	1,497,985
Financing costs-commodity supply agreement		$	588,082		$	—		$	588,082
(Gain) on debt forgiveness		$	(12,620,165	)	$	12,507,540		$	(112,625	)
Impairment on mineral deposit		$	210,116		$	—		$	210,116
Valuation change as interest on loaned shares from related party		$	127,800		$	—		$	127,800
Prepaid expenses and other assets		$	(65,241	)	$	—		$	(65,241	)
Accounts payable and accrued liabilities		$	743,444		$	—		$	743,444
Net Cash Used in Operating Activities		$	(691,667	)	$	—		$	(691,667	)
Purchase of equipment		$	(25,543	)	$	—		$	(25,543	)
Payments on mineral leases		$	(200,000	)	$	—		$	(200,000	)
Refund on joint venture investment		$	25,000		$	—		$	25,000
Payments on mineral property purchase agreement		$	(615,365	)	$	—		$	(615,365	)
Net Cash Used in Investing Activities		$	(815,908	)	$	—		$	(815,908	)
Net Cash Provided by Financing Activities		$	1,753,578		$	—		$	1,753,578
Net Increase in cash and cash equivalents		$	246,003		$	—		$	246,003

F-10

		As Previously Reported			Adjustment			Restated
Consolidated Balance Sheet at June 30, 2020:
Cash		$	103,096		$	—		$	103,096
Prepaid expenses and other current assets		$	11,873		$	—		$	11,873
Total Current Assets		$	114,969		$	—		$	114,969
Mine Equipment, net		$	333,089		$	—		$	333,089
Mineral properties		$	3,615,365			—			3,615,365
Finance lease right of use asset, net		$	35,370					$	35,370
Total Assets		$	4,098,793		$	—		$	4,098,793
Accounts payable		$	3,662,040		$	—		$	3,662,040
Accrued liabilities	A,C	$	574,003		$	—		$	574,003
Accrued interest – Tyhee loan	A,C	$	—		$	2,575,305		$	2,575,305
Accrued interest – Sandstorm completion guarantee payable	A,C	$	—		$	1,411,143		$	1,411,143
Accrued finance fee – Sandstorm commodity supply agreement	A,C	$	—		$	5,074,451		$	5,074,451
Accrued Tyhee finance fees	A,C	$	—		$	269,985		$	269,985
Finance lease liability		$	16,067		$	—		$	16,067
Notes payable, current portion – Tyhee loan principal – current portion	B,C	$	508,543		$	1,745,092		$	2,253,635
Sandstorm completion guarantee payable	C	$	—		$	3,359,873		$	3,359,873
Total Current Liabilities	C	$	4,760,653		$	14,435,849		$	19,196,502
Long-term debt, less current maturities		$	225,067		$	—		$	225,067
Finance lease liability, non-current		$	5,839		$	—		$	5,839
Total Liabilities		$	4,991,559		$	—		$	19,427,408
Common stock		$	831,915		$	—		$	831,915
Additional paid in capital		$	94,399,116		$	—		$	94,399,116
Accumulated deficit	E	$	(96,123,797	)	$	(14,435,849	)	$	(110,559,646	)
Stockholders’ Deficit	E	$	(892,766	)	$	(14,435,849	)	$	(15,328,615	)
Total Liabilities and Stockholders’ Deficit		$	4,098,793		$	—		$	4,098,793
Consolidated Statement of Operations for the fiscal year ended June 30, 2020:
Exploration and mine related costs		$	1,005,726		$	—		$	1,005,726
General and administration		$	1,609,708		$	—		$	1,609,708
Total Operating Expenses		$	2,615,434		$	—		$	2,615,434
Recovery of misappropriated funds		$	27,539		$	—		$	27,539
Interest income		$	7		$	—		$	7
Sandstorm financing costs on commodity supply agreement		$	—		$	(1,331,946	)	$	(1,331,946	)
Interest expense	D,E,F	$	(57,239	)	$	(596,363	)	$	(653,602	)
Total Other Income and (Expense)		$	(29,693	)	$	(1,928,309	)	$	(1,958,002	)
Net Income (loss)	D,E,F	$	(2,645,127	)	$	(1,928,309	)	$	(4,573,436	)

F-11

Consolidated Statement of Cash Flows for fiscal year ended June 30, 2020:
Net income (Loss)	D,E,F	$	(2,645,127	)	$	(1,928,309	)	$	(4,573,436)
Stock based compensation		$	63,064		$	—		$	63,064
Warrant/option expense from derivative liability		$	200,212		$	—		$	200,212
Financing costs-commodity supply agreement		$	—		$	1,331,946		$	1,331,946
Depreciation and amortization		$	45,990		$	—		$	45,990
Non-cash interest expense		$	4,894			—		$	4,894
Loss on debt conversion		$	36,286		$	—		$	36,286
Prepaid expenses and other assets		$	65,048		$	—		$	65,048
Accounts payable and accrued liabilities		$	439,940		$	—		$	1,036,303
Net Cash Used in Operating Activities		$	(1,789,693	)	$	—		$	(1,789,693	)
Purchase of equipment		$	(344,401	)	$	—		$	(344,401	)
Payments on mineral leases		$	(300,000	)	$	—		$	(300,000	)
Net Cash Used in Investing Activities		$	(644,401	)	$	—		$	(644,401	)
Net Cash Provided by Financing Activities		$	2,272,290		$	—		$	2,272,290
Net (Decrease) in cash and cash equivalents		$	(161,804	)	$	—		$	(161,804	)

Below presents summary financial information at the three fiscal years presented in this Form 10 filing.

		June 30,
		2021		2020 (Restated)		2019 (Restated)
Cash	$	27,458	$	103,096	$	264,900
Working capital deficit	$	20,372,840	$	19,081,533	$	16,623,864
Stockholder deficit	$	16,015,057	$	15,328,615	$	13,282,956
Current year net loss	$	2,080,512	$	4,573,436	$	3,972,836

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 on 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 implemented production at one of our recently acquired mine sites and generating substantial cash flow from operations and an acceptable source 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 fiscal years ending June 30, 2021, 2020 and 2019, the Company was in default on debt facility payments, accounts payable and accrued liabilities related to pre-bankruptcy obligations as follows:

		June 30,
		2021		2020 (Restated)		2019 (Restated)
Amount due under the Gold Stream Agreement	$	10,003,500	$	9,845,467	$	8,337,128
Other notes payable	$	2,143,885	$	2,143,885	$	2,143,885
Accrued other notes payable interest	$	3,150,606	$	2,708,854	$	2,265,953
Accounts payable and other accrued liabilities	$	3,644,799	$	3,632,595	$	3,797,585

F-12

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.

F-13

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 have proven and probable reserves, we have no development costs incurred.

As of June 30, 2021, the Company has not established proven or probable reserves or established the commercial feasibility of any of our exploration projects and all 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 commercial feasibility of any of our exploration prospects; therefore, all exploration costs are expensed as incurred. 

F-14

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 fiscal years ended June 30, 2021 and 2020 (Restated), and recognized and impairment of $210,116 on Canadian mineral leases in our fiscal year ended June 30, 2019 (Restated).

Reclamation and Asset Retirement Costs

Reclamation obligations 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 end of our fiscal years June 30, 2021, 2020 (Restated) and 2019 (Restated).

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 any 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 significant a lease agreement is entered.

F-15

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 fiscal years ended June 30, 2021, 2020 and 2019 was $360,237, $200,212 and $1,497,985 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 June 30, 2021, 2020 (Restated) and 2019 (Restated) 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 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 fiscal years ended June 30, 2021, 2020 (Restated) and 2019 (Restated), the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following:

	June 30,
	2021	2020 (Restated)	2019 (Restated)
Options to purchase common stock	30,000,000	30,000,000	30,100,000
Warrants to purchase common stock	12,865,483	5,082,149	100,000
Totals	42,865,483	35,082,149	30,200,000

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 nonemployees are valued at the earlier or a commitment date or completion of services. Stock based compensation for the fiscal years ended June 30, 2021, 2020 and 2019 was $104,833, $63,064 and $291,608, respectively.

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Recent Accounting Pronouncements

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. 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 that time the new standard will not have an impact on our consolidated financial statements until significant a lease agreement is entered.

In June 2018, the FASB issued ASU 2018-07, “Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting”, which expands the scope of Topic 718 to include all share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 specifies that Topic 718 applies to all share-based payment transactions in which the grantor acquires goods and services to be used or consumed in its own operations by issuing share-based payment awards. ASU 2018-07 also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under ASC 606. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted, but no earlier than adoption of ASC 606. The Company adopted ASU 2018-07, effective July 1, 2019, and determined the adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which removes, modifies and adds various disclosure requirements related to fair value disclosures. Disclosures related to transfers between fair value hierarchy levels will be removed and further detail around changes in unrealized gains and losses for the period and unobservable inputs used in determining level 3 fair value measurements will be added, among other changes. ASU 2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company adopted this guidance July 1, 2020.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. The standard is effective for annual periods beginning after December 15, 2020 and interim periods within, with early adoption permitted. Adoption of the standard requires certain changes to be made prospectively, with some changes to be made retrospectively. The Company is currently assessing the impact of this standard on its Consolidated Financial Statements and results of operations.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40), which eliminates the beneficial conversion and cash conversion accounting models for convertible instruments, amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions, and modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS calculation. The standard is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. The standard can be adopted under the modified retrospective method or the full retrospective method. The Company expects that this guidance will not have an impact on the Company’s consolidated financial statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force, and the SEC did not, or 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

Property  and equipment for the fiscal year June 30,2021, 2020 and 2019 is summarized in the table below:

	June 30,
	2021			2020			2019
Vehicles	$	—		$	$26,442		$	25,543
Mine equipment	146,399			146,399			—
General equipment	160,081			157,221			—
Small tools	4,882			4,882			—
Mill	20,000			—			—
Land	35,000			35,000			—
	366,362			369,944			25,543
Less: accumulated depreciation	(78,959		)	(36,855		)	—
Property and equipment, net	$	287,403		$	333,089		$	25,543

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Depreciation expense on property and equipment for the fiscal years ended June 30, 2021, 2020 (Restated) and 2019 (Restated) was $48,804, $36,855 and $0, respectively.

NOTE 4 – MINERAL PROPERTIES

The Company has capitalized acquisition costs on mineral properties at June 30, 2021, 2020 and 2019 as follows:

	June 30,
	2021		2020		2019
Alhambra - Blackhawk project	$	3,115,365	$	3,115,365	$	3,115,365
Billali – Jim Crow / Imperial minerals rights	800,000		500,000		200,000
	3,915,365		3,615,365		3,315,365
Less: Accumulated amortization	—		—		—
Mineral properties, net	$	3,915,365	$	3,615,365	$	3,315,365

Exploration Status Overview

We have not established that the Alhambra - Blackhawk project or Billali Mine - Jim Crow / Imperial Mine rights projects contain proven or probable reserves, as defined under Industry Guide 7.  

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 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.

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 has the right to cancel the Agreement at any time. The Company the exercised purchase option on the site in November 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 August or September 2022, depending on the projected completion of our planned mill operation in Duncan, Arizona.

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

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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 expenses based on the estimated site production life by our qualified person.

NOTE 5 – FINANCE LEASE RIGHT-OF-USE ASSET  

The right-of-use property consists of the following at June 30, 2021 and 2020 and the Company did not have this asset at June 30, 2019.

	June 30,
		2021		2020
ROU asset		$	44,505	$	44,505
Less: accumulated depreciation		27,407		9,135
ROU asset, net		$	17,098	$	35,370

Depreciation expense on the ROU asset for the years ended June 30, 2021 and 2020 was $18,272 and $9,135, respectively.

NOTE 6 – 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 June 30, 2021 are as follows:

Residential ½ acre in Silver City, New Mexico	$     38,000
Office building in Silver City New Mexico	184,000
42 acres of unimproved residential property,	25,800
	$   247,800

All properties held for sale are valued at their estimated net market value after disposition costs.

NOTE 7 - ACCRUED LIABILITIES

Accrued liabilities consist of the following at June 30, 2021, 2020 (Restated) and 2019 (Restated):

	June 30,
	2021		2020 (Restated)		2019 (Restated)
Audit fee payable	$	55,600	$	—	$	18,557
Merger costs, net	269,985		269,985		269,985
Payroll burden	247,121		120,628		124,619
Vacation pay	51,785		67,880		15,771
Franchise taxes	3,920		7,192		8,697
Property taxes	—		—		253,523
Accrued director fees	375,000		75,000		—
Other	95,000		58,000		29,580
Commodity supply agreement (See NOTE 10)	5,056,091		5,074,451		3,742,505
Interest	4,875,854		4,231,751		3,584,406
	$	11,030,356	$	9,904,887	$	8,047,643

NOTE 8 - NOTES PAYABLE

Canarc Share Exchange Agreement

Pursuant to Share Exchange Agreement (the "Share Exchange Agreement") with Canarc Resource Corp., a British Columbia, Canada corporation whose common shares are listed on the TSX Exchange under the symbol CCM ("Canarc") on July 15, 2014, the Company and Carnac entered into an interim financing facility pursuant to which Canarc advanced a $200,000 loan to the Company and a $20,000 merger advance. The loan bears interest an initial compounded rate of 1% a month and was due and payable upon the closing of a gold bond

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financing by the Company or January 15, 2015, if the financing does not close. The financing did not close under this Agreement and the accrued compounded interest at that date was added to the principle and the interest rate was increased to 14% per annum on the outstanding balance per the Share Exchange Agreement.

In December 2016 the court administered trust paid $9,897 to the note holder and was applied against the accrued interest on the note and was recorded as a gain on trust debt forgiveness. The principal, accrued interest and merger advance outstanding at June 30, 2017, and thereafter, is past due and in default.

A Forbearance Agreement by and among Santa Fe and Canarc was entered into and effective as of February 12, 2018. The Company agreed with Canarc to make four installment payments as follows: (i) $25,000 on February 14, 2018; (ii) $25,000 on June 30, 2018; (iii) $85,000 on October 1, 2018; and (iv) $85,000 on December 31, 2018. All payments were made on a timely basis. With the final payment completed, Canarc forgave $12,522 of principal and accrued interest on the note payable of $100,103 per the terms of the agreement and the Company recorded a gain on debt extinguishment of $112,625 in the quarter ended December 31, 2018.

The principal balance and merger advance outstanding at June 30, 2019 was $0. Accrued interest on the note at June 30, 2019 was $0. Interest expense for the years ended June 30, 2019 was $8,441.

Equipment Contract

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 June 30, 2019, 2018 and 2017, respectively and had accrued interest of $110,616, $87,687 and $64,757, respectively. In December 2016 the court administered trust paid $17,412 to the holder and was applied against the accrued interest on the contract and this amount was recorded as a gain on trust debt forgiveness. 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 June 30, 2021, 2020 and 2019. 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 this time the Company and Tyhee are 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 June 30, 2021, 2020 (Restated) and 2019 (Restated). This amount is net of a break fee of $300,000 due to the Company from Tyhee. Accrued interest on note at June 30, 2021, 2020 (Restated) and 2019 (Restated) is $2,994,127, $2,575,305 and $2,155,335, 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 years ended June 30, 2021, 2020 (Restated) and 2019 (Restated) was $418,822, $419,970 and $418,822, respectively.

Note Payable

During our fiscal year 2019, an individual loaned the Company $239,750 of which the Company paid back $40,000 during the current fiscal year, paid back $90,000 is fiscal 2020 and advanced $18,000 in fiscal 2021. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender.

The following summarizes notes payable:

	June 30,
	2021		2020 (Restated)		2019 (Restated)
Installment sales contract on equipment, interest at 5.75%, payable in 48 monthly installments of $13,874, including interest through July 2016	$	398,793	$	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		1,745,092
Note payable, interest at 6%	127,750		109,750		199,750
Notes Payable, Current	$	2,271,635	$	2,253,635	$	2,343,635

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NOTE 9 – FINANCE LEASE OBLIGATION

We signed a finance lease purchase agreement effective January 1, 2020, for the acquisition of a non-mineral property for our processing plant site to house our crusher and related future milling operations.

The determination of whether an arrangement contains a lease and the classification of a lease, if applicable, is made at lease commencement, at which time the Company also measures and recognizes an right of use (“ROU”) asset, representing the Company’s right to use the underlying asset, and a lease liability, representing the Company’s obligation to make lease payments under the terms of the arrangement. 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.

ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The rates implicit within the Company's lease is not determinable. The determination of the Company’s incremental borrowing rate requires judgment. The incremental borrowing rate is determined at lease commencement and the Company determined its incremental borrowing rate on the finance lease to be 12%. At the lease inception, the Company recorded a ROU asset of $44,505 and a corresponding lease liability of $29,505. The asset value is comprised of the present value of the lease payments at inception of $29,505 and the payment of the purchase option price of $15,000 at the lease inception for a total of $44,505.

The components of lease expense and supplemental cash flow information related to lease for the period are as follows:

	Year ended June 30, 2021		Year ended June 30, 2020
Lease Cost:
Financing lease cost included in exploration and mine costs for fiscal 2021 and 2020 is $18,272 and $1,933 and $9,136 and $1,401 in interest expense in Company’s audited consolidated statement of operations, respectively		$   20,205	$    10,537
Cash paid for amounts included in the measurement of lease liabilities for the year ended June 30, 2021 and 2020		$   18,000	$     9,000
Other Information:
Remaining lease term - operating lease (in years)		.333	1.333
Discount rate - financing lease		12.0%	12.0%
Effective rate - financing lease		13.1%	13.1%

	As of June 30, 2021	As of June 30, 2020
Financing lease:
Right-of-use asset, net	$   17,098		$  35,370
Financing lease liability - current portion	$      4,403		$  16,067
Long-term portion	—		5,839
Total operating lease liabilities	$      4,403		$  21,906

Fiscal Year Ending 6/30:	Financing Lease	Financing Lease
2021		$	18,000
2022	$        6,000		$          6,000
Total lease payments	$        6,000	$	24,000
Less: Present value discount	(1,597)		(2,094)
Present value of lease liabilities	$        4,403	$	$        21,906

Lease associated costs for fiscal June 30, 2021 and 2020 were $20,205 and $10,537, respectively.

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NOTE 10 – 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. See NOTE 12 - CONTINGENCIES AND COMMITMENTS, Commodity Supply Agreement. 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 June 30, 2021, 2020 (Restated) and 2019 (Restated), respectively, are reported as completion guarantee payable. Interest of $176,393 was expensed during each the years ended June 30, 2021, 2020 (Restated) and 2019 (Restated) on the obligation. Accrued interest on the obligation at June 30, 2021, 2020 (Restated) and 2019 (Restated) was $1,587,536, $1,411,143 and $1,234,760, respectively.

NOTE 11 - SHARES SUBJECT TO MANDATORY REDEMPTION BY RELATED PARTY

On August 9, 2017, a related party returned a certificate for 20,000,000 shares of common stock and was issued a new certificate for 2,000,000 shares on the same date. The related party loaned the 18,000,000 shares to the Company to raise additional working capital until the Company increased the authorized common shares of the Company. The related party set no specified return date after the increased share authorization and may make the election at their discretion. The value of the 18,000,000 shares is determined according to ASC 480, “Distinguishing Liabilities from Equity”. On the return date of the shares to the Company the shares were valued at the market value. On each subsequent period measurement closing, the shares will be valued at the current market price and any increase in valuation from the initial valuation will be recorded as a designated interest expense. Any decrease in valuation from the initial valuation was recorded to Addition Paid in Capital as the obligation is to a related party of the Company. The initial valuation on August 9, 2017 was $1,762,200 and at December 31, 2018 and June 30, 2018 was $1,422,000 and $1,638,000, respectively. The reduced valuation at December 31, 2018, resulted in an increase in Additional Paid in Capital of $216,000 for the six months ended December 31, 2018.

The loaned shares were returned to the related party on January 23, 2019. The obligation of associated theses shares was eliminated and a corresponding entry made to Common Stock and Additional Paid in Capital. On the date the shares were returned to the related party, the market value was $1,890,000. The increase the share valuation on the return date and elimination of the obligation to the related party was $468,000, of which Additional Paid in Capital was charged $340,200 and interest expense was charged $ 127,800.

NOTE 12 – 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 10 - 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 June 30, 2021, 2020 (Restated) and 2019 (Restated), of 3,709 ounces of undelivered gold valued at approximately  $5.06,  $5.07 and $3.74 million, respectively, presented in accrued liabilities on the balance sheet, net of the Fixed Price of $400 per ounce to be received upon delivery. 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 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. The Company will capitalize the payments under the

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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 reserves under Guide 7 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 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 June 30, 2021, the Company has not established the commercial feasibility of any of our exploration projects; therefore, all exploration costs are being expensed. In our current fiscal year ended we capitalized payments of $300,000 under the Agreement.

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 6/30/2020	$	500,000
2021		300,000
2022		575,000
2023		1,475,000
2024		2,100,000
2025		2,100,000
Thereafter		2,950,000
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 until the Company is required to lease increased office space due to additional personnel requirements. Rental expense was $6,600 for fiscal years ended June 30, 2021, 2020 and 2019, 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.

Non-Exclusive Financial Advisory and Marketing Agreement

The Company signed a one-year contract for services at payments of $10,000 a month and 100,000 warrants at an exercise price of $0.15 and with a five-year life. Pursuant to the terms of the Agreement the Company cancelled the contract effective March 23, 2021. In April 2021, the Company was served with a complaint in the State of Florida by the Euro Bentley Advisors, LLC (“EBA”) for the sum of $120,000 based on the alleged breach of the marketing agreement. The Company has settled this litigation in the amount of $100,000 and has paid $30,000 against this obligation in our quarter ending December 2021 and $70,000 in February 2022.

NOTE 13 - 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

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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, this Form 10. Unfortunately, one of the additional consequences of having our common stock deregistered is that we are required to have a market maker sponsor and submit an updated/new Form 15c-211. 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 this Form 10.  We have selected 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 have selected 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

Fiscal year ended June 30, 2021, the Company:

(i)	Issued an aggregate of 944,165 shares of restricted common stock for consulting services at a value of $59,833 on the dates of issuances;
(ii)	Accepted subscriptions for an aggregate of 15,366,668 shares of restricted common stock s from accredited investors for cash proceeds of $929,000; and
(iii)	Issued 750,000 shares of restricted common stock for the conversion bonus award of $45,000 to equity.

Fiscal year ended June 30, 2020, the Company:

(i)	Issued an aggregate of 765,821 shares of restricted common stock for consulting services at a value of $63,064 on the dates of issuances;
(ii)	Accepted subscriptions for an aggregate of 32,452,381 shares of restricted common stock s from accredited investors for cash proceeds of $2,080,000;
(iii)	Issued 2,964,299 shares of restricted common stock for the conversion debt of $184,501 to equity and recognized a loss on conversion of $36,286: and
(iv)	Upon Company authorized share increase, issued 33,318,462 shares of restricted common stock to accredited investors that were previously subscribed for in the amount of $2,7721,191.

Fiscal year ended June 30, 2019, the Company:

(i)	Issued an aggregate of 3,057,035 shares of restricted common stock for consulting services at a value of $291,608 on the dates of issuances;
(ii)	Issued an aggregate of 25,399,720 shares of restricted common stock to accredited investors for cash proceeds of $1,661,980 and finder’s fees of $20,000 were paid in connection therewith;
(iii)	Issued an aggregate of 33,318,462 shares of restricted common stock for subscribed shares from accredited investors, consulting shares granted and wage conversion shares not issued at June 30, 2018, with a value of $2,772,191; and
(iv)	Issued 18,000,000 loaned shares to a related party at a value on the date of issuance of $1,890,000.

Subscribed Capital

During the fiscal year ended June 30, 2018, the Company accepted stock subscriptions and related warrant payments from accredited investors of $2,335,362, for an aggregate of 29,191,978 shares of restricted common stock in excess of authorized capital. The Company also approved the issuance of 3,650,000 shares of restricted stock for consulting fees with a value of $389,181 on the date of grant. The Company converted a back salary to an officer amounting of $23,824 into 476,484 shares of restricted common stock with a market value of $47,648 on the date of conversion and recorded a loss on debt conversion of $23,824. At June 30, 2018, the Company had 33,318,462 unissued shares at a value of $2,772,191. The Company received authorization by the shareholders to increase Company’s authorized capital to 550,000,000 common shares in January 2019, and the subscribed capital shares were subsequently issued.

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Warrants

During the fiscal year ended June 30, 2021, the Company issued 7,783,334 three-year warrants at an average strike price of $0.062 as part of private placements to accredited investors and for conversion of debt to equity. The Black-Sholes fair value of the issued warrants was $360,237.

During the fiscal year ended June 30, 2020, the Company issued 4,982,149 three-year warrants at a strike price of $0.05 as part of private placements to accredited investors. The Black-Sholes fair value of the issued warrants was $200,212.

No warrants were issued or expired in fiscal 2019.

Options

During our fiscal years ended June 30, 2021 there was no option activity and in our fiscal year ended June 30, 2020, 100,000 options expired. During the fiscal year ended June 30, 2019, 15,000,000 options were granted to each of two directors for their efforts to revive the Company. The options have a five (5) year life and an exercise price of $0.05 per share, the market value on the date of the grant and have a non-cash exercise provision. The Black-Sholes value of the issued options was $$1,497,790. During our fiscal year ended June 30, 2019, 100,000 options expired.

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 fiscal years ending June 30, 2021, 2020 and 2019 are as follows:

	June 30, 2021		June 30, 2020		June 30, 2019
Risk-free interest rate	0.11% - 0.22	%	0.18% - 0.30	%	2.34	%
Expected volatility	123.54 – 138.01	%	120.40 – 126.39	%	285.29	%
Expected life (years)	2-5		3		5
Expected dividend	0	%	0	%	0	%

Stock option and warrant activity for the fiscal years ended June 30, 2021, 2020 and 2019 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, 2018	200,000		$0.075		4,420,000		$  0.15
Granted	30,000,000		0.05		—		—
Cancelled	—		—		—		—
Expired	(100,000	)	0.08		(4,320,000	)	0.15
Exercised	—		—		—		—
Outstanding at June 30, 2019	30,100,000		$ 0.05		100,000		$  0.15
Granted	—		—		4,982,149		0.05
Cancelled	—		—		—		—
Expired	(100,000	)	—		—		—
Exercised	—		—		—		—
Outstanding June 30, 2020	30,000,000		$ 0.05		5,082,149		$  0.05
Granted	—		—		7,783,334		0.062
Canceled	—		—		—		—
Expired	—			—	—		—
Exercised	—		—		—		—
Outstanding at June 30, 2021	30,000,000		$ 0.05		12,865,483		$0.058

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Stock options and warrants outstanding and exercisable at June 30, 2021, are as follows:

	Outstanding and Exercisable Options					Outstanding and Exercisable Warrants
			Weighted					Weighted
			Average					Average
			Contractual	Weighted				Contractual	Weighted
Exercise			Remaining	Average	Exercise			Remaining	Average
Price	Outstanding	Exercisable	Life	Exercise	Price	Outstanding	Exercisable	Life	Exercise
Range	Number	Number	(in Years)	Price	Range	Number	Number	(in Years)	Price
$0.05	30,000,000	30,000,000	2.72	$0.05	$0.05	6,732,149	6,732,149	1.84	$0.05
	—	—			$0.06	3,833,334	3,833,334	1.62	$0.06
	—	—			$0.07	2,100,000	2,100,000	1,51	$0.07
	—	—			$0.05	200,000	200,000	2.80	$0.15
	30,000,000	30,000,000				12,865,483	12,865,483
	Outstanding Options		2.72	$0.05	Outstanding Warrants			1.73	$0.058
	Exercisable Options		2.72	$0.05	Exercisable Warrants			1.73	$0.058

As of June 30, 2021, the aggregate intrinsic value of all stock options and warrants vested and expected to vest was $359,975 and the aggregate intrinsic value of currently exercisable stock options and warrants was $359,975. 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 16, 2020 when the stock was delisted. The total number of in-the-money options and warrants vested and exercisable as of June 30, 2021 was 36,732,149.

The total intrinsic value associated with options exercised during the year ended June 30, 2021 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 fiscal year ended June 30, 2021 was $360,237.

NOTE 15 - 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, 2017.

Due to various events that required restatement of the Company’s audited financial statements, the Company has not filed tax returns since our fiscal year ended June 20, 2016.  Upon completion of our restated audited financial statements the Company will file all the delinquent tax returns due with the federal and state jurisdictions.

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 June 30, 2020 and 2021 and 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 and the approximate income tax benefit is computed by applying the current revised New Mexico revised tax rate of 5.9% to net income (loss) before taxes for the fiscal year ended after June 30, 2020 and 2021, and the revised tax rate of 5.9% to the prior four-year periods.

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 June 30, 2021, 2020 (Restated) and 2019 (Restated).

At June 30, 2021, the Company had estimated federal tax basis net operating loss carry forwards for federal income tax purposes of approximately $104.8 million. Under the Tax Cuts and Jobs Act (“TCJA”) passed on December 22, 2017, provides that net operating losses (“NOL”) arising in tax years beginning after December 31, 2017, the TCJA limits NOL deduction to 80% of taxable income. For tax years beginning after December 31, 2017, the TCJA eliminated the two-year carryback period but allows for an infinite carryforward.

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The components of the income tax benefit provision are as follows:

	Fiscal Years Ended June 30,
Current year tax (benefit)	2021		2020		2019
			(Restated)		(Restated)
Federal tax (benefit) at federal statutory rate	$	(360,816)	$	(910,606)	$	(521,258)
State tax (benefit)	(101,372)		(255,837)			(146,449)
Expiration of federal tax benefit	288,776		1,044,179		234,766
Expiration of state tax benefit	—		—		—
Reduction in Federal and/or State tax rates	—		—		84,198
(Decrease) increase in valuation allowance	173,412		122,264		348,743
Total	$	—	$	—	$	—

The components of the deferred tax asset are as follows:

	Fiscal Years Ended June 30,
Deferred Tax Asset	2021		2020		2019
			(Restated)		(Restated)
Federal net operating loss carryforward	$	(22,266,990)	$	(22,194,950)	$	(22,328,523)
State net operating loss carryforward	(2,159,552)		(2,058,180)			(1,802,343)
Valuation allowance		24,426,542		24,253,130		24,130,866
Net Deferred Tax Asset	$	—	$	—	$	—

For NOL’s generated in tax years beginning prior to December 31, 2017, the prior tax law still applies, and the 80 percent limitation does not apply, and the NOL’s can be carried forward for 20 years. The Company has an approximate NOL under the old tax law of $96.3 million. The NOL’s under the old tax law expire in varying amounts between 2022 and 2038. The Company under the new has an approximate NOL of $8.5 million and the losses and the losses can be carried forward on an infinite basis.

At June 30, 2021, the Company had estimated state tax basis NOL carryforwards for state income tax purposes of approximately $35.4 million. Net operating losses for state income tax purposes beginning with our tax year ended in 2014, may be carried forward for nineteen years. These losses expire in varying amounts from 2033 to 2040.

NOTE 16 – RELATED PARTY TRANSACTIONS

Since August 2015, the Company has leased a home office space from Mr. Mueller, the former chief financial officer of the Company, for $550 a month for the corporate administrative office in Albuquerque, NM. Rental expense was $6,600 for fiscal years ended June 30, 2020 and 2019, respectively.

Since July 2019, Nataliia Mueller, wife of Mr. Mueller, has been paid an annual wage of $60,000 as an assistant to the prior and current CFO, in the areas of purchasing, payroll and accounts payable.

During the fiscal year ended June 30, 2019, the former CFO for the Company loaned the Company $10,000 and deferred net salary aggregating $51,848 into a note at 6% per annum, At June 30, 2019, balance on the note and accrued interest on the note was $61,848 and $1,651, respectively, and the note has no stated due date.  During fiscal 2020, the former CFO made additional cash advances of $55,000 and deferred net salary of $25,189 and accrued interest on the obligation of $4,528 in fiscal 2020. During fiscal 2020 the CFO converted the debt and accrued interest to restricted common shares of the Company and the Company recorded a non-cash $36,286 loss on the conversion.

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

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aggregates approximately $1,651,263. As of the filing of this report, Mr. Laws has pleaded guilty to various charges of which we have collected $809,534 in cash and properties with an estimated net market value of $209,800 as of the date of filing of this Form 10.

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.

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 17 – LEGAL PROCEEDINGS

All legal proceedings were stayed with the filing of Chapter 11 bankruptcy.

Boart Longyear Company v. Lordsburg Mining Company, Case No. D-2-2-CV-2015- 06048, County of Bernalillo, NM; Boart Longyear Company v. Lordsburg Mining Company, Case No. D-721-CV-2015- 00058, County of Sierra, NM; and Boart Longyear Company v. Lordsburg Mining Company, Case No. D-608-CV- 201500165, County of Quintero, NM. There are a series of collection cases by Boart Longyear Company, a company that obtained Utah judgments for equipment delivered to Lordsburg Mining Company in the aggregate amounts of $158,480 and has an interest rate of 5.25% per annum. Accrued interest on the obligation at June 30, 2021, 2020 and 2019 was $45,002, $36,682 and $28,339 respectively. Interest expense on the obligation for the fiscal years ended June 30, 2021, 2020 and 2019 was $8,320, 8,320 and $8,321, respectively.

Wagner Equipment Co. v. Lordsburg Mining Company, Case No. D-2014-02372, County of Bernalillo, NM 28 is a collection case by Wagner equipment, who obtained judgment for equipment delivered to Lordsburg Mining Company in the amount of $115,789 and has a rate of interest of 8.75% per annum. Accrued interest on the obligation at June 30, 2021, 2020 and 2019 was $67,862 and $57,731 and $47,571respectively. Interest on the obligation for the fiscal years ended June 30, 2021, 2020 and 2019 was $10,132, $10,159 and $10,132, respectively.

On November 30, 2017, the Company entered into substantially identical agreements with Fortune Graphite, Inc. and Worldwide Graphite Producers, Ltd. to acquire a total of four placer claims for aggregate consideration of Can$400,000 and the issuance of 10,000,000 shares of Company common stock. Title to these claims remains in trust with the sellers until payment is made in full. To date, the Company has paid Can$260,000. The Company owes the sellers Can$140,000 and 10,000,000 shares of Company common stock under the agreement. Based upon our additional information that came to light and our subsequent scrutiny and analysis of the transaction, the Company, in February 2019, initiated an arbitration proceeding against the seller to void and rescind the purchase of these British Columbia properties. In addition to voiding and rescission, the Company is seeking additional remedies. In October 2020, the arbitrator ruled in favor of the Company and the 10,000,000 shares reserved under the agreements has been nullified. In connection with this arbitration, the Company’s legal position was to void the transaction and, due to the uncertainty of the outcome, has provided an impairment at June 30, 2019 in the amount of $210,116. A deposit of $54,000 was made by the seller for the arbitration and the arbitrator will determine the distribution of this amount. The Company filed with the arbitrator for reimbursement of all legal costs associated with the arbitration and any other amounts to be awarded. In February 2021, the Company was awarded approximately $53,000, and after payment of legal fees, received net proceeds of approximately $4,500.

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

F-28

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. 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 $809,534 in cash and properties with an estimated net market value of $209 ,800 as of the date of filing of this report.

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.

The U.S. Department of Justice (“DOJ”) and the Securities and Exchange Commission (“SEC”) each initiated investigations into the Company, its officers, directors, and potentially others, resulting from the Laws transactions.  The SEC has obtained a formal order to investigate the Company with respect to Laws, and while we understand that the DOJ investigation lead to Mr. Laws plea of guilty to various charges, including charges based on his actions alleged by the Company. Mr. Laws has signed a settlement agreement with the SEC.None of funds that Mr. Laws owes the Company were ever received or benefited by anyone other than Mr. Laws, nor was there ever any evidence found (after a forensic review of the Company’s books and records by an independent forensic accounting firm) that anyone else benefited in any way from the Laws transaction(s). However, notwithstanding the forgoing, the SEC investigated this matter and although he did not benefit from or participate in the Laws misappropriation, determined that they would proceed against our Former Chief Financial Officer (notwithstanding the fact that he was the person that notified the SEC), he determined that it would be in his and the Company’s best interest if he were to settle the matter and bring closure to the investigation.  Under the terms of the settlement, he was prohibited from serving as an officer or director of a publicly traded company for a period of five years and in addition was required to pay a fine.  The Company considers Mr. Mueller as an important asset of the Company with substantial depth of institutional knowledge of the Company and its position in the mining industry as well as the various players in the industry.  Without this knowledge the Company would be at a substantial disadvantage and as such, rather than terminate him or allow him to resign, we determined that we would reassign him to mining operations if he was willing to serve in that capacity. Because he remained with the Company, we developed a protocol and scope of responsibility to meet the requirements of his settlement with the SEC and fully disclosed the protocol and scope of responsibility to the SEC Staff that had negotiated the settlement agreement. Thus, his continuing roll with the Company has been reviewed by SEC staff who approved of his continuing roll, provided that the Company follow it. In accordance with accounting standards regarding loss contingencies, the Company accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated, and the Company discloses the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for its financial statements not to be misleading. The Company does not record liabilities when the likelihood that the liability has been incurred is probable, but the amount cannot be reasonably estimated, or when the liability is believed to be only reasonably possible or remote.

In April 2021, the Company was served with a complaint in the State of Florida by Euro Bentley Advisors, LLC (“EBA”) for the sum of $120,000 based on the alleged breach of contract between the Company and EBA.  The Company has settled this litigation in the amount of $100,000 and has paid $30,000 against this obligation in our quarter ending December 2021.

We are subject from time to time to litigation, claims and suits arising in the ordinary course of business.

NOTE 18 – SUBSEQUENT EVENTS

Recent Issuances of Unregistered Securities     

In the period from July 1, 2021 through June 13, 2022, the Company sold an aggregate of 3,220,000 restricted shares of common stock to accredited investors for cash proceeds $161,000. The Company also sold an aggregate of 5,070,000 restricted shares of common stock to the chairman of the board for cash proceeds $253,500.

In the period from July 1, 2021 through June 13, 2022, the Company issued warrants to accredited investors aggregating 1,610,000, and 1,535,000 warrants to the chairman of the board that were attached to restricted stock purchases. The warrants were vested at issuance, have a two or three year life and an exercise price of $0.05 per share. The Company also issued 10,000,000 vested options at an exercise price of $0.05 per share and with a six-month or a three-year life in reference to three notes payable from an accredited shareholder as disclosed under financing facilities.

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Financing Facilities

In October 2021, the Company signed a 2-year note for $200,000 from an accredited shareholder and the proceeds to be specifically used for the purchase of Duncan, AZ mill property site and any remaining proceeds to be used for general Company expenses. The terms of the note provide for an annual rate of interest at 10 percent and annual interest payments on the note anniversary dates. The note also provides for the issuance of 4,000,000 vested three-year options at an exercise price of $0.05 per share and a lien on the mill site property.

In November 2021 the Company signed a 2-year note for $200,000 from an accredited shareholder and the proceeds to be specifically used for general Company expenses. The terms of the note provide for an annual rate of interest at 10 percent and annual interest payments on the note anniversary dates. The note also provides for the issuance of 4,000,000 vested three-year options at an exercise price of $0.05 per share and a lien on the mill site property.

In April 2022, the Company signed a note for $100,000 from an accredited shareholder. The proceeds are to be specifically used for  Company general financial obligations. The terms of the note provide for a six-month maturity date from the note date with an annual rate of interest at 12 percent with interest paid on the maturity date. The note also provides for the issuance of 2,000,000 six-month vested options at an exercise price of $0.05 per share.

Miscellaneous Event

At the end of October 2021, the Company exercised the purchase option on the mill property site in Duncan, Arizona and the transaction closed on November 9, 2021.

Acquisition of Processing Mill

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 in August 2022, when the necessary funding will be raised by the Company for the acquisition of the mill equipment and its construction. In November 2021, the Company completed the cash purchase of the land for the mill site in Duncan, Arizona for $175,343. At the time of filing this amended Form 10-12G/A, negotiations for the purchase of the disassembled mill with the seller have not taken place and will be finalized upon the Company raising the adequate funding for the acquisition and if the seller or the Company will be responsible for its construction at the mill site.  

F-30

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

The financial statements and notes thereto contains certain “forward-looking” statements as such term is defined by the Securities and Exchange Commission in its rules, regulations and releases, which represent the Company’s expectations or beliefs, including but not limited to, statements concerning the Company’s strategy, operations, economic performance, financial condition, resource drilling strategies, investments, and future operational plans. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intent,” “could,” “estimate,” “might,” “plan,” “predict” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements. This Form 10 contains forward-looking statements, many assuming that the Company secures adequate financing and is able to continue as a going concern, including statements regarding, among other things: our ability to continue as a going concern; including but not limited to statements regarding the following:

•exploration for minerals is highly speculative and involves greater risk than many other businesses; as such, most exploration programs fail to result in the discovery of economic mineralization; 

•our mineralized material calculations at various projects are only estimates and are based principally on historic data; 

•actual capital costs, operating costs, production and economic returns may differ significantly from those that we have anticipated; 

•exposure to all of the risks associated with restarting and establishing new mining operations, if the development of one or more of our mineral projects is found to be economically feasible; 

•title to some of our mineral properties may be uncertain or defective; 

•land reclamation and mine closure may be burdensome and costly; 

•significant risk and hazards associated with mining operations; 

•we will require additional financing in the future to develop a mine at any other projects; 

•the requirements that we obtain, maintain and renew environmental, construction and mining permits, which is often a costly and time-consuming process and may be opposed by local environmental group; 

•our anticipated needs for working capital; 

•our ability to secure financing; 

•claims and legal proceedings against us; 

•our lack of necessary financial resources to complete development of our projects and the uncertainty of our future financing plans; 

•our exposure to material costs, liabilities and obligations because of environmental laws and regulations (including changes thereto) and permits; 

•changes in the price of silver and gold; 

•extensive regulation by the U.S. government as well as state and local governments; 

•our projected sales and profitability; 

•our business growth strategies; 

•anticipated trends in our industry; 

•the lack of commercial acceptance of our product or by-products; 

•problems regarding availability of materials and equipment; 

•failure of equipment to process or operate in accordance with specifications, including expected throughput, which could prevent the production of commercially viable output; and 

•our ability to seek out and acquire additional high-quality gold, silver and/or copper properties. 

F-31

Occurrence of such events or circumstances could have a material adverse effect on our business, financial condition, results of operations or cash flows or the market price of our securities. All subsequent written and oral forward-looking statements by or attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Except as may be required by securities or other law, the Company does not intend to undertake to update the information in this Form 10 if any forward-looking statement later turns out to be inaccurate whether as a result of new information, future events, or other circumstances. We believe that the expectations reflected in our forward-looking statements are based on reasonable assumptions, such statements can only be based on facts and factors currently known to us. Consequently, forward-looking statements are inherently subject to risks and uncertainties and actual results and outcomes may differ materially from the results and outcomes discussed in or anticipated by the forward-looking statements. Factors that could cause or contribute to such differences in results and outcomes include, without limitation, those specifically addressed under the heading “Risk Factors” as detailed in Item1A in this Form 10. You should not unduly rely on any of our forward-looking statements. These statements speak only as of the date of this filed Form 10. 

F-32

SANTA FE GOLD CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS
		March 31,			June 30,
		2022			2021
		(Unaudited)			(Audited)
ASSETS
Current Assets:
Cash and cash equivalents	$	2,398		$	27,458
Prepaid expenses and other current assets		14,350			8,902
Total current assets		16,748			36,360
Property and equipment, net		443,558			287,403
Mineral rights		4,115,365			3,915,365
Finance lease right-of-use asset, net		—			17,098
Assets held for sale		209,800			247,800
Deposit		125			—
Total Assets	$	4,785,596		$	4,504,026
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Accounts payable	$	3,765,794		$	3,742,934
Accrued liabilities		12,549,184			11,030,355
Finance lease liability		—			4,403
Notes payable, current maturities		2,243,635			2,271,635
Completion guarantee payable		3,359,873			3,359,873
Total Current Liabilities		21,918,486			20,409,200
Long Term Debt:
Notes payable		400,000			—
PPP loans payable		110,706			109,883
Total Liabilities		22,429,192			20,519,083
Commitments and Contingencies
Stockholders' Deficit:
Common stock, $.002 par value, 550,000,000 shares authorized at March 31, 2022 and     June 30, 2021; 440,248,551 issued and outstanding at March 31, 2022 and
433,018,551 shares issued and outstanding at June 30, 2021		880,497			866,037
Additional paid-in capital		96,487,962			95,759,064
Accumulated deficit		(115,012,055	)		(112,640,158	)
Total Stockholders' Deficit		(17,643,596	)		(16,015,057	)
Total Liabilities and Stockholders' Deficit	$	4,785,596		$	4,504,026

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

F-33

SANTA FE GLD CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended March 31,						Nine Months Ended March 31,
	2022			2021			2022			2021
Revenues	$	—		$	—		$	—		$	—
Operating Expenses:
Mine and mine related costs		31,748			34,106			101,339			488,208
General and administrative		268,115			331,668			1,104,700			1,401,954
(Loss) on asset disposition		—			(656	)		—			1,836
Total operating expenses		299,863			365,118			1,206,039			1,891,998
Loss From Operations		(299,863	)		(365,118	)		(1,206,039	)		(1,891,998	)
Other Income and (Expense):
Interest income		—			—			—			2
Miscellaneous income		—			7,384			—			7,384
Gain on debt extinguishment		—			226,367			—			226,367
Recovery(misappropriation) of funds		—			286,090			(522	)		551,090
Finance costs- commodity supply agreement		(505,553	)		729,029			(663,933	)		285,788
Interest expense		(169,264	)		(160,751	)		(501,403	)		(486,759	)
Total other income (expense)		(674,817	)		1,088,119			(1,165,858	)		583,872
Loss before provision for income taxes		(974,680	)		723,001			(2,371,897	)		(1308,126	)
Provision for income taxes		—			—			—			—
Net (Loss), Gain and Comprehensive Gain, (Loss)	$	(974,680	)	$	723,001		$	(2,371,897	)	$	(1,308,126	)
Basic and Diluted Per Share Data:
Net Loss Per Share - basic and diluted	$	(0.00 )		$	(0.00	)	$	(0.00 )		$	(0.00	)
Weighted Average Common Shares Outstanding:
Basic		439,161,884			431,484,587			437,394,135			427,623,218
Diluted		439,161,884			437,504,217			437,394,135			427,623,218

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

F-34

SANTA FE GOLD CORPORATION

CONDENSED CONSOLIDATED STATEMENTS  OF STOCKHOLDERS’ DEFICIT

FOR THE NINE MONTHS ENDED MARCH 31, 2021 AND 2022

(Unaudited)

					Additional
	Common Stock				Paid-In		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance, June 30, 2020		415,957,718	$	831,915	$	94,399,116	$	(110,559,646	)	$	(15,328,615	)
Issuance  of stock for consulting services		213,162		426		14,496		—			14,922
Issuance of stock for cash		8,083,334		16,167		471,333		—			487,500
Issuance of stock for bonus compensation		750,000		1,500		43,500		—			45,000
Value of warrants issued with stock purchases		—		—		200,817		—			200,817
Net loss		—		—		—		(1,549,281	)		(1,549,281	)
Balance September 30, 2020		425,004,214		850,008		95,129,262		(112,108,927	)		(16,129,657	)
Issuance  of stock for consulting services		230,167		461		14,501		—			14,962
Issuance of stock for cash		5,000,000		10,000		290,000		—			300,000
Value of warrants issued with stock purchases		—		—		111,640		—			111,640
Net loss		—		—		—		(481,846	)		(481,846	)
Balance December 31, 2020		430,234,381		860,469		95,545,403		(112,590,773	)		(16,184,901	)
Issuance  of stock for consulting services		250,000		500		14,449		—			14,949
Issuance of stock for cash		2,283,334		4,566		136,934		—			141,500
Value of warrants issued with stock purchases		—		—		47,780		—			47,780
Current period income		—		—		—		723,001			723,001
Balance March 31, 2021		432,767,715	$	865,535	$	95,744,566	$	(111,867,772	)	$	(15,257,671	)
Balance, June 30, 2021		433,018,551	$	866,037	$	95,759,064	$	(112,640,158	)	$	(16,015,057	)
Issuance of stock for cash		4,170,000		8,340		200,160		—			208,500
Value of warrants issued with stock purchases		—		—		90,633		—			90,633
Net loss		—		—		—		(453,448	)		(453,448	)
Balance, September 30, 2021		437,188,551		874,377		96,049,857		(113,093,606	)		(16,169,372	)
Issuance of stock for cash		600,000		1,200		28,800		—			30,000
Value of warrants issued with stock purchases		—		—		269,661		—			269,661
Net loss		—		—		—		(943,769	)		(943,769	)
Balance, December 31, 2021		437,788,551		875,577		96,348,318		(114,037,375	)		(16,813,480	)
Issuance of stock for cash		2,460,000		4,920		118,080					123,000
Value of warrants issued with stock purchases						21,564					21,564
Net loss								(974,680	)		(974,680	)
Balance, March 31, 2022		440,248,551	$	880,497	$	96,487,962	$	(115,012,055	)	$	(17,643,596	)

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

F-35

SANTA FE GOLD CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

		Nine Months Ended March 31,
		2022			2021
Cash Flows from Operating Activities:
Net Income  (loss)	$	(2,371,897	)	$   (1,308,126		)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Stock basis compensation		—		89,833
Warrant/option expense from derivative liability		381,858		360,237
Depreciation and amortization		40,412		51,067
Non-cash interest expense		823		1,390
Non-cash expense		(18,000	)	—
Gain on debt forgiveness		—		(226,367		)
Loss on asset disposition		—		1,836
Non-cash adjustment on recovery of misappropriated funds		522		—
Non-cash assets received regarding misappropriated funds		—		(555,529		)
Net change in operating assets and liabilities:
Prepaid expenses and other current assets		(5,448	)	(778		)
Accounts payable and accrued liabilities		1,541,689		733,354
Net Cash Used in Operating Activities		(430,041	)	(853,083		)
Cash Flows from Investing Activities:
Payment on mineral leases		(200,000	)	(175,000		)
Purchase of property, plant and equipment		(179,469	)	(2,860		)
Net Cash Used in Investing Activities		(379,469	)	(177,860		)
Cash Flows from Financing Activities:
Proceeds from issuance of common stock		361,500		929,000
Insurance proceeds from truck loss		—		17,906
Proceeds from SBA Paycheck Protection Program		—		109,520
Proceeds from asset sale of real estate		37,478		—
Proceeds from note payable		400,000		18,000
Payment on note payable		(10,000	)	—
Payment of lease deposit		(125	)	—
Payments on lease principle		(4,403	)	(11,851		)
Net Cash Provided by Financing Activities		784,450		1,062,575
Net (Decrease) Increase in Cash and Cash Equivalents		(25,060	)	31,632
Cash and Cash Equivalents Beginning of year		27,458		103,096
Cash and Cash Equivalents End of Year		$           2,398		$        134,728
Supplemental Cash Flow Information:
Interest		$             161		$           1,649
Income  taxes		$               —		$                —
Supplemental Schedule of Non-Cash Investing and Financing Activities
Commodity Supply finance agreement		$      663,933		$       285,788

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-36

SANTA FE GOLD CORPORATION
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

(Unaudited)

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. These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern. 

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, Santa Fe Acquisitions Company, 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 a related water rights lease agreement. 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.

In October 2021, we exercised the purchase option for $164,335 on the mill property in Duncan, Arizona, and the transaction closed on November 9, 2021.

We are considered an “exploration stage” company under the U.S. Securities and Exchange Commission (“the SEC”). None of our properties contain proven or probable mineral reserves as defined in Regulation S-K 1300 and all the Company’s activities are exploratory in nature. 

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 be effectively contained, nor can we predict the severity and duration of its impact. If the outbreak of COVID-19 is 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 August or September 2022, depending on the projected completion of our planned mill operation in Duncan, Arizona.

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.

F-37

Below presents summary financial information at the two periods presented in this Form 10-Q filing.

		March 31,		June 30,
		2022		2021
Cash on hand	$	2,398	$	27,458
Working capital (deficit)	$	(21,901,738)	$	(20,372,840)
Stockholder (deficit)	$	(17,643,596)	$	(16,015,157)
				March 31,
				2021
Current quarter net (loss)	$	(974,680)	$	723,001

		March 31,			June 30,
		2022			2021
Cash on hand	$	2,398		$	27,458
Working capital (deficit)	$	(21,901,738	)	$	(20,372,840	)
Stockholder (deficit)	$	(17,643,596	)	$	(16,015,157	)
					March 31,
					2021
Current quarter net (loss)	$	(974,680	)	$	723,001

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 implemented production at one of our recently acquired mine sites and generating substantial cash flow from operations and an acceptable source 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 March 31, 2022 and June 30, 2021, the Company was in default on accounts payable and debt facility payments that relate to our pre-bankruptcy debt as follows:

	March 31,	June 30,
	2022	2021
Amount due under the Gold Stream Agreement	$   10,799,727	$ 10,003,500
Other notes payable	2,143,885	2,143,885
Accounts payable and other accrued liabilities	3,658,647	3,644,799
Accrued other notes payable interest	3,482,207	3,150,606
Total	$   20,084,466	$ 18,942,790

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, mineral rights, 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.

F-38

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. Under Regulation S-K 1300, these costs where a property has no mineral reserves disclosed, is an exploration stage company and all these costs are expensed and classified as exploration expense. Capitalization of mine development project costs, that meet the definition of an asset, begins once the Company has a mineral reserve. 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.

Drilling and related costs are capitalized for an ore body when a mineral reserve exist and the activities are directed at obtaining additional information on the ore body or converting non-reserve mineralization to a mineral reserve. 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.

When mine development cost incurred, they are amortized using the units-of-production method based upon estimated recoverable ounces in a mineral  reserve. 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

F-39

specific ore body. Currently, none of the claims or mines in our possession have mineral reserves, accordingly, we have no development costs incurred.

As of March 31, 2022, the Company has not established mineral reserves or established the economically viability of any of our projects in the opinion of a qualified person as defined in Regulation S-K 1300.

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. Acquired mineral rights are considered tangible assets under ASC 930-805 and requires that mineral rights be recognized at fair value as of the acquisition date. As a result, the direct costs to acquire mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with acquiring patented and unpatented mining claims.

The Company’s mineral rights generally are enforceable regardless of whether mineral 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 mineral reserves and/or undeveloped 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 we are in the exploration stage. If the Company identifies mineral reserves, as defined under Regulation S-K 1300, in its investigation of its properties and discloses such information, we would enter the development stage and capitalize future costs until production is established.

When it is determined that a property has mineral reserves and in the opinion of the qualified person is the basis of an economically viable project, 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 of mineral reserves and the Company would enter the development stage.

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 periods ended March 31, 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 periods ended March 31, 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.

F-40

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 fiscal periods ended March 31, 2022 and 2021 was $381,858 and $360,237, 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 March 31, 2022, and June 30, 2021, 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.

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For nine months ended March 31, 2022 and 2021 and the three months ended March 31, 2022, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect.

The potentially dilutive securities consisted of the following for the three months ended March 31, 2022 and the nine months ended March 31, 2022 and 2021:

	Three Months	Nine Months
	Ended March 31,	Ended March 31,
	2022	2021	2022
Options to purchase common stock	38,000,000	30,000,000	38,000,000
Warrants to purchase common stock	15,480,483	12,865,483	15,480,483

A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation for the three months ended March 31, 2021 is as follows:  

	Net Income  (Numerator)		Weighted Average Common Shares (Denominator)		Per Share Amount
For the three months ended March 31, 2021:
Basic EPS
Income available to common stockholders		$          723,001		431,484,567	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		6,019,650
Income available to common stockholders plus assumed conversions		$         723,001		437,504,217	$	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. Stock based compensation for the nine-months ended March 31 31, 2022 and 2021was $0 and $89,833, respectively.

Recent Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. The standard is effective for annual periods beginning after December 15, 2020 and interim periods within, with early adoption permitted. Adoption of the standard requires certain changes to be made prospectively, with some changes to be made retrospectively. The Company adopted the ASU 2019-12, Income Taxes (“Topic 740”) and has determined there currently is no impact of this standard on its Consolidated Financial Statements and results of operations.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40), which eliminates the beneficial conversion and cash conversion accounting models for convertible instruments, amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions, and modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS calculation. The standard is effective for annual periods beginning after December 15, 2021, and interim periods within those reporting periods. The standard can be adopted under the modified retrospective method or the full retrospective method. The Company expects that this guidance will not currently  have an impact on the Company’s consolidated financial statements.

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Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force, and the SEC did not, or 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

Property and equipment consist of the following at March 31, 2022 and June 30, 2021:

	March 31,		June 30,
	2022		2021
Mine equipment	$       146,399		$        146,399
General equipment	160,081		160,081
Small tools	4,882		4,882
Mill site land	175,343		—
Mill site development costs	35,134		20,000
Land	35,000		35,000
	556,839		366,362
Less: accumulated  depreciation	(113,281	)	(78,959	)
	$        443,558		$        287,403

Depreciation expense on property and equipment for the nine months ended March 31, 2022 and 2021 was $34,322 and $37,363, respectively.

NOTE 4 – MINERAL RIGHTS

The Company has capitalized acquisition costs on mineral properties at December 31, 2022 and June 30, 2021 as follows:

	March 31,		June 30,
	2022		2021
Alhambra – Blackhawk project	$	3,115,365	$	3,115,365
Billali – Jim crow Imperial minerals rights		1,000,000		800,000
		4,115,365		3,915,365
Less: Accumulated amortization		—		—
Mineral property	$	4,115,365	$	3,915,365

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

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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.

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 August or September 2022, depending on the projected completion of our mill operation in Duncan, Arizona.

NOTE 5 – FINANCE LEASE RIGHT-OF-USE ASSET  

		March 31,		June 30,
		2022		2021
Alhambra – Blackhawk project	$	44,505	$	44,505
Less: Accumulated depreciation		(33,497)		(27,407)
Land portion reclassified to mill site		(11,008)		—
Mineral property	$	—	$	17,098

NOTE 6 – 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 March 31, 2022 are as follows:

Office building in Silver City New Mexico	$      184,000
42 acres of unimproved residential property,	25,800
	$     209,800

All properties held for sale are valued at their estimated net market value after disposition costs.

The office  building property is under a sales contract with a sales price of $215,000 and is scheduled to close in late May 2022.

NOTE 7 - ACCRUED LIABILITIES

Accrued liabilities consist of the following at March 31, 2022 and June 30, 2021:

	March 31,		June 30,
	2022		2021
Franchise taxes	$	3,920	$	3,920
Audit fees	43,250		55,600
Merger costs, net	269,986		269,986
Payroll burden	366,709		247,119
Vacation pay	36,014		51,785
Professional fees	65,250		—
Accrued director fees	600,000		375,000
Mining costs	68,000		95,000
Interest	5,376,031		4,875,854
Commodity Supply Agreement finance fees	5,720,024		5,056,091
	$   12,549,184		$  11,030,355

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NOTE 8 - NOTES PAYABLE

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 March 31, 2022 and June 30, 2021, respectively, had accrued interest of $173,677 and $156,479, respectively and interest expense of $17,198, respectively for the nine months ended March 31, 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 March 31, 2022 and June 30, 2021. 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 March 31, 2022 and June 30, 2021. This amount is net of a break fee of $300,000 due to the Company from Tyhee. Accrued interest on note at March 31, 2022 and June 30, 2021 is $3,308,530 and $2,994,127, 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 nine months ended March 31, 2022 and 2021 was $314,403, respectively.

Notes Payable

A shareholder during the quarter ended December 31, 2021,  made two secured loans of $200,000 each, with an annual interest rate of 10% and, 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 March 31, 2022 is $16,712. Interest expense on these notes for the nine months ended March 31, 2022 is $16,612.

An individual during our fiscal year 2019 loaned 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 December 31, 2021 and June 30, 2021 is $28,011 and $24,848, 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 March 31, 2022 and June 30, 2021 was $99,750 and $127,750, respectively. Interest expense on the loan for the nine months ended March 31, 2022 and 2021 is $5,720 and $5,647, respectively.

The following summarizes notes payable:

	March 31,			June 30,
	2022			2021
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
Notes payable, interest at 10%	400,000			—
Note payable, interest at 6%	99,750			127,750
	2,643,635			2,271,635
Long term note payable	(400,000		)	—
Short term notes payable	$	2,243,635		$	2,271,635

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

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"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, commissions, and 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.

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 has been extended to 10 months from the end of the covered period. The 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 sixteen months from April 30, 2020. The PPP Note matures in two years from that 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.

During our fiscal year 2021 our PPP loans received in 2020, and the accrued interest thereon were forgiven in the amount of $226,367 and a gain on debt forgiveness was recognized.

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 following summarizes Paycheck Protection Program Loans at March 31, 2022 and June 30, 2021:

	March 31,		June 30,
	2022		2021
Loans payable to bank under the Paycheck Protection Program		$          109,520		$         109,520
Accrued interest on Paycheck Protection Program Loans	1,186		363
		$         110,706		$        109,883

NOTE 9 – 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. See NOTE 11 - CONTINGENCIES AND COMMITMENTS, Commodity Supply Agreement. 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 March 31, 2022 and June 30, 2021, respectively, and are reported as completion guarantee payable. Interest of $132,295 was expensed during the nine months ended March 31, 2022 and 2021 on the obligation, respectively. Accrued interest on the obligation at March 31, 2022 and 2021 was $1,719,832 and 1,543,438, respectively.

NOTE 10 – FINANCE LEASE OBLIGATION

We signed a finance lease purchase agreement effective January 1, 2020, for the acquisition of a non-mineral property for our processing plant site to house our crusher and related future milling operations.

The determination of whether an arrangement contains a lease and the classification of a lease, if applicable, is made at lease commencement, at which time the Company also measures and recognizes an right of use (“ROU”) asset, representing the Company’s right to use the underlying asset, and a lease liability, representing the Company’s obligation to make lease payments under the terms of the arrangement. 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.

ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The rates implicit within the Company's lease is not determinable. The determination of the Company’s incremental borrowing rate requires judgment. The incremental borrowing rate is determined at lease commencement and the Company determined its incremental borrowing rate on the finance lease to be 12%. At the lease inception, the Company recorded a ROU asset of $44,505 and a corresponding lease liability of $29,505. The asset value is comprised of the present value of the lease payments at inception of $29,505 and the payment of the purchase option price of $15,000 at the lease inception for a total of $44,505. The lease was paid in full in October 2021.

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The components of lease expense and supplemental cash flow information related to lease for the period are as follows:

	Period ended March 31, 2022
Lease Cost:
Financing lease cost included in exploration and mine costs for nine months ended March 31, 2022 is $6,090 and $97 in interest expense in Company’s consolidated statement of operations	$    6,187
Cash paid for amounts included in the measurement of lease liabilities for the nine months ended March 31, 2022	$     4,500
Other Information:
Remaining lease term - operating lease (in years)	none
Discount rate - financing lease	12.0%
Effective rate - financing lease	13.1%

	As of March 31, 2022
Financing lease:
Right-of-use asset, net		$         —
Financing lease liability - current portion		$         —
Long-term portion		$         —
Total operating lease liabilities		$         —

Fiscal Year Ending 6/30:	Financing Lease
2022		$         —
2022		$         —
Total lease payments		$         —
Less: Present value discount
Present value of lease liabilities		$         —

Lease associated costs for nine months ended March 31, 2022 and 2021 were $6,187 and $15,353, respectively.

NOTE 11 - 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 9 - 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 March 31, 2022 and 2021 of 3,709 ounces of undelivered gold valued at approximately $5.72 and $5.06 million, respectively, presented in accrued liabilities on the balance sheet net of the Fixed Price of

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$400 per ounce to be received upon delivery.  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 March 31, 2022, the Company has not established mineral reserves on any of our exploration projects; therefore, all exploration costs are being expensed. In our current period of operation ended March 31, 2022, we capitalized payments of $50,000 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 6/30/2020	$	500,000
2021		300,000
2022		575,000
2023		1,475,000
2024		2,100,000
2025		2,100,000
Thereafter		2,950,000
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 at $125 per month as the official Company address. Rental expense for the nine months ended March 31, 2022 and 2021 was $6,075 and $4,950, 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.

Non-Exclusive Financial Advisory and Marketing Agreement

The Company signed a one-year contract for services at payments of $10,000 a month and 100,000 warrants at an exercise price of $0.15 and with a five-year life. Pursuant to the terms of the Agreement the Company cancelled the contract effective March 23, 2021. In April 2021, the

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Company was served with a complaint in the State of Florida by the Euro Bentley Advisors, LLC (“EBA”) for the sum of $120,000 based on the alleged breach of the marketing agreement. The Company has settled this litigation in the amount of $100,000 and has paid $30,000 against this obligation in our quarter ending December 2021 and $70,000 in our quarter ending March 2022.

NOTE 12 - 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, this Form 10. Unfortunately, one of the additional consequences of having our common stock deregistered is that we are required to have a market maker sponsor and submit an updated/new Form 15c-211. 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 this Form 10. We have selected a market maker to sponsor our Form 15c-211 filing with the OTC. 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 have selected 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 nine months ended March 31, 2022, the Company:

(i) Accepted subscriptions for an aggregate of 7,230,000 shares of restricted common stock from accredited investors for cash proceeds of $361,500.

Warrants

During the nine months ended March 31, 2022, the Company issued 2,615,000 three-year warrants at an average strike price of $0.05 as part of private placements to accredited investors. The Black-Sholes fair value of the issued warrants for the nine months ended March 31, 2022 is $112,197.

Options

During the nine months ended March 31, 2022, we issued 8,000,000 two-year options at an exercise  price of $0.05 as part of placement of two notes payable to an accredited investor/shareholder. The Black-Sholes fair value of the issued warrants for the nine months ended March 31, 2022 is $269,661.

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 March 31, 2022 and 2021 were as follows:

	March 31, 2022		March 31, 2021
Risk-free interest rate	0.30% - 1.38	%	0.11% - 0.31	%
Expected volatility	99.35 – 119.78	%	12.54 - 138.01	%
Expected life (years)	2-3		2-5
Expected dividend yield	0	%	0	%

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Stock option and warrant activity for the nine months ended March 31, 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, 2021	30,000,000	$ 0.05		12,865,483	$  0.15
Granted	8,000,000	0.05		2,615,000	0.05
Canceled	—	—		—	—
Expired	—		—	—	—
Exercised	—	—		—	—
Outstanding at March 31, 2022	38,000,000	$ 0.05		15,480,483	$0.057

Stock options and warrants outstanding and exercisable at March 31, 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	38,000,000	38,000,000	1.89	$0.05	9,347,149	9,347,149	1,47
	—	—		$0.06	3,833,334	3,833,334	0.87
	—	—		$0.07	2,100,000	2,100,000	0.76
	—	—		$0.15	200,000	200,000	2.05
	38,000,000	38,000,000			15,480,483	15,480,483
	Outstanding Options		1.89	Outstanding Warrants				1.23		$0.056
	Exercisable Options		1.89	Exercisable Warrants				1.23		$0.056

As of March 31, 2022, the aggregate intrinsic value of all stock options and warrants vested and expected to vest was $464,002 and the aggregate intrinsic value of currently exercisable stock options and warrants was $464,002. 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 March 31, 2022 was 53,480,483.

The total intrinsic value associated with options exercised during the nine months ended March 31, 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 nine months ended March 31, 2022 was $381,858.

NOTE 13 - 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, 2021.

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 March 31, 2022 and June 30, 2021.

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NOTE 14 – 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 as the Company address. Rental expense was $6,025 and $4,950 for nine months ended March 31, 2022 and 2021, respectively.

Since July 2019, Nataliia Mueller, wife of Mr. Mueller, has been paid an annual wage of $60,000 as an 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 $809,534 in cash and properties held for sale with an estimated net market value of $209,800 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.

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

All legal proceedings were stayed with the filing of Chapter 11 bankruptcy.

Boart Longyear Company v. Lordsburg Mining Company, Case No. D-2-2-CV-2015- 06048, County of Bernalillo, NM; Boart Longyear Company v. Lordsburg Mining Company, Case No. D-721-CV-2015- 00058, County of Sierra, NM; and Boart Longyear Company v. Lordsburg Mining Company, Case No. D-608-CV- 201500165, County of Quintero, NM. There are a series of collection cases by Boart Longyear Company, a company that obtained Utah judgments for equipment delivered to Lordsburg Mining Company in the aggregate amounts of $158,480 and has an interest rate of 5.25% per annum. Accrued interest on the obligation at March 31, 2022 and June 30, 2021 was $51,248 and $45,002 respectively. Interest on the obligation for the nine months ended March 31, 2022 and 2021 was $6,246, respectively.

Wagner Equipment Co. v. Lordsburg Mining Company, Case No. D-2014-02372, County of Bernalillo, NM 28 is a collection case by Wagner equipment, who obtained judgment for equipment delivered to Lordsburg Mining Company in the amount of $115,789 and has a rate of interest of 8.75% per annum. Accrued interest on the obligation at March 31, 2022 and June 30, 2021 was $75,468 and $67,862, respectively. Interest on the obligation for the nine months ended March 31, 2022 and 2021 was $7,606 respectively.

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.

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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 $809,534 in cash and properties with an estimated net market value of $209,800 as of the date of filing of this Form 10.

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.

In April 2021, the Company was served with a complaint in the State of Florida by Euro Bentley Advisors, LLC (“EBA”) for the sum of $120,000 based on the alleged breach of contract between the Company and EBA. The Company has settled this litigation in the amount of $100,000 and has paid $30,000 against this obligation in our quarter ending December 2021 and the remaining $70,000 was paid in February 2022.

We are subject from time to time to litigation, claims and suits arising in the ordinary course of business.

NOTE 16 – SUBSEQUENT EVENTS

Recent Issuances of Unregistered Securities     

In the period from April 1, 2022 through June 13, 2022, the Company sold of 60,000 restricted shares of common stock to accredited investor for cash proceeds $3,000. The Company also sold 1,000,000 restricted shares of common stock to the chairman of the board for cash proceeds $50,000.

In the period from April 1, 2022 through June 13, 2022, the Company issued to the accredited investors 30,000 warrants  and 500,000 warrants to the chairman of the board that were attached to the restricted stock purchases. The warrants were vested at issuance, have a three life and an exercise price of $0.05 per share.

In the period from April 1, 2022 through June 13, 2022, the Company issued 2,000,000  six-month vested options at an exercise price of $0.05 per share in reference to a $100,000 six-month loan from an accredited shareholder.

Financing Facility

In April 2022, the Company signed a note for $100,000 with an accredited shareholder. The proceeds are to be specifically used for  Company general financial obligations. The terms of the note provide for a six-month maturity date from the note date with an annual rate of interest at 12 percent with interest paid on the maturity date. The note also provides for the issuance of  2,000,000 six-month vested options at an exercise price of $0.05 per share.

Acquisition of Processing Mill

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 in August 2022, when the necessary funding will be raised by the Company for the acquisition of the mill equipment and its construction. In November 2021, the Company completed the cash purchase of the land for the mill site in Duncan, Arizona for $175,343. At the time of filing this amended Form 10-12G/A, negotiations for the purchase of the disassembled mill with the seller have not taken place and will be finalized upon the Company raising the adequate funding for the acquisition and if the seller or the Company will be responsible for its construction at the mill site.  

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EX-3.1

 

 

 

EX-3.2

 

 

 

 

 

 

EX-3.3

 

 

EX-3.4

 

 

EX-3.5

EXHIBIT B

AMENDED BYLAWS OF

AZCO MINING INC.

ARTICLE I.

Offices

The registered office of the corporation shall be in the City of Wilmington, County of New Castle, State of Delaware.

The corporation may also have offices at such other places both within and without the State of Delaware as the board of directors may from time to time determine or the business of the corporation may require. 

ARTICLE II.

Stockholders

Section 2.1.Annual Meeting. The annual meeting of the stockholders shall be held at a time and date fixed by the board of directors, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. If the day fixed for the annual meeting shall be a legal holiday, such meeting shall be held on the next succeeding business day. If the election of directors shall not be held on the day designated herein for any annual meeting of the stockholders, or at any adjournment thereof, the board of directors shall cause the election to be held at a special meeting of the stockholders as soon thereafter as conveniently may be. 

Section 2.2. Special Meetings. Special meetings of the stockholders, for any purpose, unless otherwise prescribed by statute, may be called by the president, or by the board of directors, and shall be called by the president at the request of the holders of not less than a majority of all the outstanding shares of the corporation entitled to vote at the meeting. Such request shall state the purpose or purposes of the proposed meeting.

Section 2.3. Place of Meeting. The board of directors may designate any place, either within or outside Delaware, as the place for any annual meeting or for any special meeting called by the board of directors. A waiver of notice signed by all stockholders entitled to vote at a meeting may designate any place, either within or outside Delaware, as the place for such meeting. If no designation is made, or if a special meeting shall be called otherwise than by the board, the place of meeting shall be the registered office of the corporation in Delaware.

Section 2.4. Fixing Date for Determination of Stockholders of Record. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for any other lawful action, the board of directors may fix, in advance, a date as the record date for any such determination of stockholders, which date shall not be more than 60 nor less than ten days before the date of such meeting, nor more than 60 days prior.to any other action. If no record date is fixed then the record date shall be: (a) for determining stockholders entitled to notice of or to vote at the meeting of stockholders, the close of business on the day next preceding the day on which the meeting is held; and (b)for determining stockholders for any other purpose other than to express written consent to corporate action without a meeting which shall be governed by Section 2.11,the close of business on the day on which the board of directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting.

Section 2.5. Notice of Meeting. Written notice stating the place, day and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than ten nor more than 60 days before the date of the meeting, unless otherwise required by statute, either personally or by mail, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the stockholder at his address as it appears on the stock books of the corporation, with postage thereon prepaid. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is more than 30 days, or if after adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 2.6. Organization. The president or any vice president shall call meetings of stockholders to order and act as chairman of such meetings. In the absence of said officers, any stockholder entitled to vote at that meeting, or any proxy of any such stockholder, may call the meeting to order and a chairman shall be elected by a majority of the stockholders entitled to vote at that meeting. In the absence of the secretary or any assistant

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secretary of the corporation, any person appointed by the chairman shall act as secretary of such meetings.

Section 2.7. Procedure. The chairman shall be charged with the orderly conduct of all meetings; provided however, that in the event of any difference in opinion with respect to the proper cause of action which cannot be resolved by reference to statute, or to the articles of incorporation or these bylaws, Robert's Rules of Order (as last revised) shall govern the disposition of the matter.

Section 2.8. Voting Lists. The officer who has charge of the stock books of the corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder.  Such list shall be open to the examination of each stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held.  The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

Section 2.9. Quorum. One-third of the outstanding shares of the corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting ofstockholders for the transaction of business except as otherwise provided by statute or by the certificate of incorporation. If fewer than one-third of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time in accordance with Section 5 of this Article, until a quorum shall be present or represented.

Section 2.10. Manner of Acting. When a quorum is present at any meeting, the affirmative vote of a majority of the shares represented at the meeting and entitled to vote on the subject matter shall be the act of the stockholders, unless a different vote is required by law or the certificate of incorporation, in which case such express provision shall govern.

Section 2.11. Informal Action by Stockholders.

(a) Unless otherwise provided in the certificate ofincorporation, any action required or permitted to be taken at any meeting of the stockholders may be taken without a meeting, without prior notice and without a vote, provided that a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum

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number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote, thereon were present and voted.  In order that the coporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the board of directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the board of directors, and which date shall not be more than 10 days after the date upon which the resolution fixing the record date is adopted by the board of directors. Any stockholder of record seeking to have the stockholders authorize or take corporate action by written consent shall, by written notice to the Secretary, request the board of directors to fix a record date. The board of directors shall promptly, but in all events within 10 days after the date on which such a request is received, adopt a resolution fixing the record date. If no record date has been fixed by the board of directors within 10 days of the date on which such a request is received, the record date for determining stockholders enticled to consent to corporate action in writing without a meeting, when no prior action by the board of directors is required by applicable law, shall  be the first date on which signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or any officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the board of directors and prior action by the board of directors is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the date on which the board of directors adopts the resolution taking such prior action.

(b) Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. In the event that the action which is consented to is such as would require the filing of a certificate with the Secretary of State of Delaware under the General Corporation Law of the State of Delaware if such action had been voted on by stockholders at a meeting thereof, the certificate filed shall state, in lieu of any statement required under law concerning any vote of stockholders, that written consent has been given in accordance with the provisions of law and that written notice has been given as provided by law.

Section 2.12. Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent dissent to corporate action in writing without a meeting may authorize any other person or persons to act for him by proxy, but no such proxy

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shall be voted or acted upon after three years from its date unless the proxy provides for a longer period.

Section 2.13. Voting of Shares.  Unless otherwise provided in the certificate  of incorporation  and subject to the provisions of Section 4 of this Article, each stockholder shall be entitled to one vote for each share of capital stock held by such stockholder. In the election of directors, each record holder of stock entitled to vote at such election shall have the right to vote the - number of shares owned by him for as many persons as there are directors to be elected, and for whose election he has the right to vote. Cumulative voting shall not be allowed.

Section 2.14. Voting of Shares by Certain Holders. Persons holding stock in a fiduciary capacity shall be entitled to vote the shares so held.  Persons whose stock is pledged shall be, entitled to vote, unless in the transfer by the pledgor on the books of the corporation the pledger has expressly empowered the pledgee to vote thereon, in which case only the pledgee or his proxy may represent such shares and vote thereon.  If shares stand of record in the names of two or more persons, whether fiduciaries, members of a partnership, joint tenants, tenants in common, tenants by the entirety or otherwise, or if two or more persons have the same fiduciary relationship respecting the same shares, unless the secretary of the corporation is given written notice to the contrary and if furnished with a copy of the instrument or order appointing them or creating the relationship wherein it is so provided, their acts with respect to voting shall be as set forth in the General Corporation Law of the State of Delaware.

Section 2.15. Nominations. (a) Nominations for election to the board of directors of the corporation and the proposal of business to be considered by the stockholder may be made at an annual meeting of stockholders (i) pursuant; to the corporation's notice of meeting, (ii) by or at the direction of the board of directors or (iii) by any stockholder of the corporation who was a stockholder of record at the time of giving of the notice provided for in this Section 2.15, who is entitled to vote at the meeting and who complied with the notice procedures set forth in this Section 2.15.

(b) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (iii) of paragraph (a) of this Section 2.15, the stockholder must have given timely notice thereof in writing to the Secretary of the corporation. To be timely, a stockholder's notice shall be delivered to the Secretary at the principal executive offices of the corporation not less than sixty days nor more than ninety days prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event that the date of the annual meeting is advanced by more than thirty days or delayed by more than sixty days from such anniversary date or no, annual

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meeting has been held in the preceding year, notice by the stockholder to be timely must be so delivered not earlier than the ninetieth day prior to such annual meeting and not later than the close of business on the later of the sixtieth day prior to the annual meeting or the tenth day following the day on which public announcement of the date of such meeting is first made. Such stockholder's notice shall set forth (i) as to each person whom the stockholder proposes to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (including such person's written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (ii) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any financial or other interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and (iii) as to the stockholder giving notice and the beneficial owner, if any, on whose behalf the proposal is being made (1) the name and address of such stockholder, as they appear on the corporation's books, and of such beneficial owner and (2) the class and number of shares of the corporation which are owned beneficially and or record by such stockholder and such beneficial owner.

(c) Notwithstanding anything in the second sentence of paragraph (b) of this Section 2.15 to the contrary, in the event that the number of directors to be elected to the board of directors of the corporation is increased and there is no public announcement naming all of the nominees for director or specifying the size of the increased board of directors made by the corporation at least seventy days prior to the first anniversary of the preceding year's annual meeting, a stockholder's notice required by this Section 2.15 shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the corporation not later than the close of business on the tenth day following·the day on which such public announcement is first made by the corporation.

(d) Only such persons who are nominated in accordance with the procedures set forth in this Section 2.15 shall be eligible to serve as directors and only such business shall be conducted at an annual meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 2.15. The presiding officer of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made in accordance with the procedures set forth in this Section 2.15 and,

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if any proposed nomination or business is not in compliance with this Section 2.15, to declare that such defective proposed business or nomination shall be disregarded.·

(e) For purposes of this Section 2.15, “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.·

(f) Notwithstanding the foregoing provisions: of this Section 2.15, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 2.15.  Nothing in this Section 2.15 shall be deemed to affect any rights of stockholders to request inclusion of proposals in the corporation's proxy statement pursuant to Rule 14a-8 under the Exchange Act.

ARTICLE III.

Board of Directors

Section 3.1. General Powers.  The business and affairs of the corporation shall be managed by or under the direction of its board of directors, except as otherwise provided in the General Corporation Law of the State of Delaware or the certificate of incorporation.

Section 3.2. Number Tenure and Qualification.  The number of directors of the corporation shall be not less than one and not greater than seven. Directors shall be elected at each annual meeting of stockholders except as otherwise provided in Section 3 of this Article. Each director shall hold office until his successor shall have been elected and qualified or until the earliest of his death, resignation or removal. Directors need not be residents of Delaware or stockholders of the corporation.

Section 3.3. Vacancies. Any director may resign at any time by giving written notice to the corporation. Such resignation shall take effect at the time specified therein; and unless otherwise specified therein, the acceptance of such·resignation shall not be necessary to make it effective. Any vacancy or newly created directorship resulting from an increase in the authorized number of directors may be filled by the affirmative vote of the majority of directors then in office, although less than quorum, or by a sole remaining director, and a director so chosen shall hold office until the next annual election and until his sµccessor is duly elected and qualified, unless sooner displaced. If at any time, by reason of death, resignation or other cause, the

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corporation should have no directors in office, then an election of directors may be held in the manner provided by law. If, at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole board (as constituted immediately prior to any such increase), the Court of Chancery may, upon application of any stockholder or stockholders who hold at least ten percent of the total number of outstanding shares at the time and who have the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office. When one or more directors shall resign from the board, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have the power to fill any vacancy or vacancies, with the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office until the next annual election and until his successor is duly elected and has qualified.

Section 3.4. Regular Meetings.  A regular meeting of the board of directors shall be held without other notice than this bylaw immediately after and at the same place as the annual meeting of stockholders. The board of directors may provide by resolution the time and place, either within or outside Delaware, for the holding of additional regular meetings without other notice than such resolution.

Section 3.5. Special Meetings. Special meetings of the board of directors may be called by or at the request of the president or any two directors. The person or persons authorized to call special meetings of the board of directors may fix any place, either within or outside Delaware, as the place for holding any special meeting of the board of directors called by them.

Section 3.6. Notice. Notice of any special meeting shall be given at least five days previously thereto by written notice delivered personally or mailed to each director at his business address, or by notice given at least two days previously thereto by telegraph. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail so addressed, with postage thereon prepaid. If notice be given by telegram, such notice shall be deemed to be delivered when the telegram is delivered to the telegraph company. Neither the business to be transacted at, nor the purpose of, any regular or special, meeting of the board of directors need be specified in the notice or waiver of notice of such meeting.

Section 3.7. Quorum. A majority of the member of directors fixed by Section 2 of this Article shall constitute a quorum for the transaction of business at any meeting of the board of directors, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the

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meeting from time to time, without notice other than announcement at the meeting, uqtil a quorum shall be present.

Section 3.8. Manner of Acting. The vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors, except as may be otherwise specifically provided by law or the certificate of incorporation.

Section 3.9. Removal. Unless otherwise restricted by law, any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of shares then entitled to vote at an election of directors.

Section 3.10. Committees. The board of directors may, by resolution passed by a majority of the whole board, designate one or more committees, each committee to consist of one or more of the directors of the·corporation. The board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not they constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in the place of such absent or disqualified member.· Any such committee, to the extent provided in the resolution of the board of directors, shall have and may exercise all the powers and authority of the board of directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to amend the certificate of incorporation, to adopt an agreement of merger or consolidation, to recommend to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets, to recommend to the stockholders a dissolution of the corporation or a revocation of a dissolution, or to amend the bylaws' of the corporation; and, unless the resolution expressly so provides, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required.

Section 3.11. Compensation. Unless otherwise restricted by the certificate of incorporation or these bylaws, the board of directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at such meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of any

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Committee of the board may be allowed like compensation for attending committee meetings.

Section 3.12. Informal Action by Directors. Unless otherwise restricted by the certificate of incorporation or these bylaws, any action required or permitted to be taken at any meeting of the board of directors or any committee thereof may be taken without a meeting if all members of the board or committee, as the case may be, consent thereto in writing and the writing or writings are filed with the minutes of the proceedings of the board or committee.

Section 3.13. Meetings by Telephone. Unless otherwise restricted by the certificate of incorporation or these bylaws, members of the board of directors, or any committee designated by the board of directors, may participate in a meeting of the board, of directors, or any committee thereof, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting in such manner shall constitute presence in person at the meeting.

ARTICLE IV.

Officers and Agents

Section 4.1. General. The officers of the corporation shall be a president, a secretary and a treasurer. The board of directors may appoint such other officers, assistant officers, and agents, a chairman or vice-chairmen of the board, assistant secretaries and assistant treasurers, as they may consider necessary, who shall be chosen in such manner and hold their offices for such terms and have such authority and duties; as from time to time may be determined by the board of directors. The salaries of all the officers of the corporation shall be fixed by the board of directors. Any number of offices may be held by the same person with the exception of the office of president and secretary being held simultaneously by the same person, or as otherwise provided in the certificate of incorporation or these bylaws.

Section 4.2. Election and Term of Office. The officers of the corporation shall be elected by the board of directors annually at the first meeting of the board held after each annual meeting of the stockholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be.  Each officer shall hold office until his successor shall have been duly elected and qualified or until the earliest to occur of his death, resignation or removal.

Section 4.3. Removal. Any officer or agent elected or appointed by the board of directors may be removed at any time by

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the board whenever in its judgment the best interests of the corporation will be served thereby.

Section 4.4. Vacancies. Any officer may resign at any time upon written notice to the corporation. Such resignation shall take effect at the time stated herein; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Any vacancy occurring in any office by death, resignation, removal or otherwise shall be filled by the board of directors for the unexpired portion of the term. If any officer shall be absent or unable for any reason to perform his duties, the board of directors, to the extent not otherwise consistent with these bylaws or law, may direct that the duties of such officer during such absence or inability shall be performed by such other officer or assistant officer as seems advisabl to the board.

Section 4.5. Authority and Duties of Officers. The officers of the corporation shall have the authority and shall exercise the powers and perform the duties specified below, and as may be otherwise specified by the board of directors or by these bylaws, except that in any event each officer shall exercise such powers and perform such duties as may be required by law, and in cases where the duties of any officer or agent are not prescribed by these bylaws or by the board of directors, such officer or agent shall follow the orders and instructions of (a) the president, and if a chairman of the board is elected, then (b) the chairman of the board.

(a)President. The president, subject to the direction and supervision of the board of directors, shall have the following responsibilities: (i) be the chief executive officer of the corporation and have general and active control of its affairs, business and property and general supervision of its officers, agents and employees; (ii) preside at all meetings of the stockholders; (iii) see that all orders and resolutions of the board of directors are carried into effect; and (iv) sign or countersign all certificates, contracts and other instruments of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the board of directors to some other officer or agent of the corporation. In addition, the president shall, unless otherwise directed by the board of directors, attend in person or by substitute appointed by them, or by written instruments appointing proxy or proxies to represent the corporation, all meetings of the stockholders of any corporation in which the corporation shall hold any stock and may, on behalf of the corporation, in person or by substitute or proxy, execute written waivers of notice and consents with respect to such meetings. At all such meetings and otherwise, the president, in person or by substitute or proxy as aforesaid, may vote the stock so held by the corporation and may execute written consent and 

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other instruments with respect to such stock and may exercise any and all rights and powers incident to the ownership of said stock, subject however to the instructions, if any, of the board of directors. Subject to the directions of the board of directors, the president shall exercise all other powers and perform all other duties normally incident to the office of president of a corporation and shall exercise such other powers and perform such other duties as from time to time may be assigned to him by the board. If a chairman of the board has been elected, the chairman of the board shall have, subject to the direction and modification of the board of directors, all the same.responsibilitie, rights and obligations as described in these bylaws for the pre ident.

(b)Vice Presidents. The vice presidents, if any shall be elected, and if they be so directed shall assist the president and shall perform such duties as may be assigned to the by the president or by the board of directors. In the absence of the president, the vice president designated by the board of directors or (if there be no such designation) designated in writing by the president shall have the powers and perform the duties of the president. If no such designation shall be made all vice presidents may exercise such powers and perform such duties. 

(c)Secretary. The secretary shall perform the following functions: (i) record or cause to be recorded the proceedings of the meeting of the stockholders, the board of directors and any committees of the board of directors in book to be kept for that purpose; (ii) see that all notices are duly given in accordance with the provisions of these bylaws or as required by law; (iii) be custodian of the corporate records and of the seal of the corporation; (iv) keep at the corporation's registered office or principal place of business within or outside Delaware a record containing the names and addresses of all stockholders and the number and class of shares held by each, unless such a record shall be kept at the office of the corporation's transfer agent or registrar; (v) have general charge of the stock books of the corporation unless the corporation has a transfer agent; and (vi) in general, perform all other duties as from time to time may be assigned to him by the president, or by the board of directors. Assistant secretaries, if any, shall have the same duties and powers subject to supervision by the secretary. 

(d)Treasurer. The treasurer shall perform the following functions: (i) be the principal financial officer of the corporation and have the care and custody of all funds; securities, evidences of indebtedness and other personal property of the corporation and deposit the same in accordance with the instructions of the board of directors; (ii) receive and give receipts and acquittances for monies paid in on account of the corporation, and pay out of the funds on hand all bills, payrolls and other just debts of the corporation of whatever nature upon maturity; (iii) be the principal accounting officer of the 

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EX-4.1

SUBSCRIPTION AGREEMENT

EX-4.2

Schedule 1 to Subscription Agreement

NEITHER THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) AN EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.

Effective Date: XXXXXXXVoid After: XXXXXXXX  

SANTA FE GOLD CORPORATION

WARRANT TO PURCHASE COMMON STOCK

Santa Fe Gold Corporation., a Delaware corporation (the “Company”), for value received on XXXXXX (the “Effective Date”), hereby issues to XXXXXXXXX (the “Holder”) this Warrant (the “Warrant”) to purchase up to XXXXXXXX shares (each such share as from time to time adjusted as hereinafter provided being a “Warrant Share” or “Share” and all such shares being the “Warrant Shares” or “Shares”) of the Company’s Common Stock (as defined below), at the Exercise Price (as defined below), as adjusted from time to time as provided herein, on or before XXXXXXX (the “Expiration Date”), all subject to the following terms and conditions, including the vesting provisions set forth in Section 1(a).

As used in this Warrant, (i) “Business Day” means any day other than Saturday, Sunday or any other day on which commercial banks in the City of Albuquerque, New Mexico, are authorized or required by law or executive order to close; (ii) “Common Stock” means the common stock of the Company, including any securities issued or issuable with respect thereto or into which or for which such shares may be exchanged for, or converted into, pursuant to any stock dividend, stock split, stock combination, recapitalization, reclassification, reorganization or other similar event; (iii) “Exercise Price” means $XXX per share of Common Stock, subject to adjustment as provided herein; (iv) “Trading Day” means any day on which the Common Stock is traded on the primary national or regional stock exchange on which the Common Stock is listed, or if not so listed, the Pink Sheets, if quoted thereon,is open for the transaction of business; and (v) “Affiliate” means any person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, a person, as such terms are used and construed in Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”).

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1.DURATION AND EXERCISE OF WARRANTS 

(a)Exercise Period and Vesting.  The Holder may exercise this Warrant in whole or in part on any Business Day on or before 5:00 P.M., Central Time, on the Expiration Date, at which time this Warrant shall become void and of no value.   

(b)Exercise Procedures. 

(i)While this Warrant remains outstanding and exercisable in accordance with Section 1(a), the Holder may exercise this Warrant in whole or in part at any time and from time to time by: 

(A)delivery to the Company of a duly executed copy of the Notice of Exercise attached as Exhibit A; 

(B)surrender of this Warrant to the Secretary of the Company at its principal offices or at such other office or agency as the Company may specify in writing to the Holder; and 

(C)payment of the then-applicable Exercise Price per share multiplied by the number of Warrant Shares being purchased upon exercise of the Warrant (such amount, the “Aggregate Exercise Price”) made in the form of cash, or by certified check, bank draft or money order payable in lawful money of the United States of America. 

(ii)Upon the exercise of this Warrant in compliance with the provisions of this Section 1(b), the Company shall promptly issue and cause to be delivered to the Holder a certificate for the Warrant Shares purchased by the Holder. Each exercise of this Warrant shall be effective immediately prior to the close of business on the date (the “Date of Exercise”) that the conditions set forth in Section 1(b) have been satisfied, as the case may be.  On the first Business Day following the date on which the Company has received each of the Notice of Exercise and the Aggregate Exercise Price (the “Exercise Delivery Documents”), the Company shall transmit an acknowledgment of receipt of the Exercise Delivery Documents to the Company’s transfer agent (the “Transfer Agent”). On or before the fifth Business Day following the date on which the Company has received all of the Exercise Delivery Documents (the “Share Delivery Date”), the Company shall issue and dispatch by overnight courier to the address as specified in the Notice of Exercise, a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise.  Upon delivery of the Exercise Delivery Documents, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates evidencing such Warrant Shares.  

(d)Partial Exercise.  This Warrant shall be exercisable, either in its entirety or, from time to time, for part only of the number of Warrant Shares referenced by this Warrant. If this Warrant is exercised in part, the Company shall issue, at its expense, a new Warrant, in  

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substantially the form of this Warrant, referencing such reduced number of Warrant Shares that remain subject to this Warrant.

(e) Disputes.  In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance with Section 16. 

2.ISSUANCE OF WARRANT SHARES 

(a)The Company covenants that all Warrant Shares will, upon issuance in accordance with the terms of this Warrant, be (i) duly authorized, fully paid and non-assessable, and (ii) free from all liens, charges and security interests, with the exception of claims arising through the acts or omissions of any Holder and except as arising from applicable Federal and state securities laws. 

(b)The Company shall register this Warrant upon records to be maintained by the Company for that purpose in the name of the record holder of such Warrant from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner thereof for the purpose of any exercise thereof, any distribution to the Holder thereof and for all other purposes. 

(c)The Company will not, by amendment of its certificate of formation, by-laws or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all action necessary or appropriate in order to protect the rights of the Holder to exercise this Warrant, or against impairment of such rights. 

3.ADJUSTMENTS OF EXERCISE PRICE, NUMBER AND TYPE OF WARRANT SHARES 

(a)The Exercise Price and the number of shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time upon the occurrence of certain events described in this Section 3(a); provided, that notwithstanding the provisions of this Section 3, the Company shall not be required to make any adjustment if and to the extent that such adjustment would require the Company to issue a number of shares of Common Stock in excess of its authorized but unissued shares of Common Stock, less all amounts of Common Stock that have been reserved for issue upon the conversion of all outstanding securities convertible into shares of Common Stock and the exercise of all outstanding options, warrants and other rights exercisable for shares of Common Stock.  If the Company does not have the requisite number of authorized but unissued shares of Common Stock to make any adjustment, the Company shall use its commercially best efforts to obtain the necessary stockholder consent to increase the authorized number of shares of Common Stock to make such an adjustment pursuant to this Section 3(a). 

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(i)Subdivision or Combination of Stock. In case the Company shall at any time subdivide (whether by way of stock dividend, stock split or otherwise) its outstanding shares of Common Stock into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision shall be proportionately reduced and the number of Warrant Shares shall be proportionately increased, and conversely, in case the outstanding shares of Common Stock of the Company shall be combined (whether by way of stock combination, reverse stock split or otherwise) into a smaller number of shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Shares shall be proportionately decreased.  The Exercise Price and the Warrant Shares, as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described in this Section 3(a)(i). 

(ii)Dividends in Stock, Property, Reclassification. If at any time, or from time to time, all of the holders of Common Stock (or any shares of stock or other securities at the time receivable upon the exercise of this Warrant) shall have received or become entitled to receive, without payment therefore: 

(A)any shares of stock or other securities that are at any time directly or indirectly convertible into or exchangeable for Common Stock, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution, or 

(B)additional stock or other securities or property (including cash) by way of spin-off, split-up, reclassification, combination of shares or similar corporate rearrangement (other than shares of Common Stock issued as a stock split or adjustments in respect of which shall be covered by the terms of Section 3(a)(i) above), then and in each such case, the Exercise Price and the number of Warrant Shares to be obtained upon exercise of this Warrant shall be adjusted proportionately, and the Holder hereof shall, upon the exercise of this Warrant, be entitled to receive, in addition to the number of shares of Common Stock receivable thereupon, and without payment of any additional consideration therefor, the amount of stock and other securities and property (including cash in the cases referred to above) that such Holder would hold on the date of such exercise had such Holder been the holder of record of such Common Stock as of the date on which holders of Common Stock received or became entitled to receive such shares or all other additional stock and other securities and property.  The Exercise Price and the Warrant Shares, as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described in this Section 3(a)(ii). 

(iii)Reorganization, Reclassification, Consolidation, Merger or Sale. If any recapitalization, reclassification or reorganization of the capital stock of the Company, or any consolidation or merger of the Company with another corporation, or the sale of all or substantially all of its assets or other transaction shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities, or other assets or property (an “Organic Change”), then, as a condition of such Organic Change, lawful and adequate provisions shall be made by the Company whereby the Holder hereof shall thereafter have the right to purchase and receive (in lieu of the shares of the Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented by this Warrant) such shares of stock,  

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securities or other assets or property as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore purchasable and receivable assuming the full exercise of the rights represented by this Warrant. In the event of any Organic Change, appropriate provision shall be made by the Company with respect to the rights and interests of the Holder of this Warrant to the end that the provisions hereof (including, without limitation, provisions for adjustments of the Exercise Price and of the number of shares purchasable and receivable upon the exercise of this Warrant) shall thereafter be applicable, in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company will not effect any such consolidation, merger or sale unless, prior to the consummation thereof, the successor corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing such assets shall assume by written instrument reasonably satisfactory in form and substance to the Holder executed and mailed or delivered to the registered Holder hereof at the last address of such Holder appearing on the books of the Company, the obligation to deliver to such Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such Holder may be entitled to purchase.If there is an Organic Change, then the Company shall cause to be mailed to the Holder at its last address as it shall appear on the books and records of the Company, at least 10 calendar days before the effective date of the Organic Change, a notice stating the date on which such Organic Change is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares for securities, cash, or other property delivered upon such Organic Change; provided, that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice.  The Holder is entitled to exercise this Warrant during the 10-day period commencing on the date of such notice to the effective date of the event triggering such notice.  In any event, the successor corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing such assets shall be deemed to assume such obligation to deliver to such Holder such shares of stock, securities or assets even in the absence of a written instrument assuming such obligation to the extent such assumption occurs by operation of law.  

(c)Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment pursuant to this Section 3, the Company at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each Holder of this Warrant a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall promptly furnish or cause to be furnished to such Holder a like certificate setting forth: (i) such adjustments and readjustments; and (ii) the number of shares and the amount, if any, of other property which at the time would be received upon the exercise of the Warrant. 

(d)Certain Events. If any event occurs as to which the other provisions of this Section 3 are not strictly applicable but the lack of any adjustment would not fairly protect the purchase rights of the Holder under this Warrant in accordance with the basic intent and principles of such provisions, or if strictly applicable would not fairly protect the purchase rights of the Holder under this Warrant in accordance with the basic intent and principles of such provisions, then the Company’s Board of Directors will, in good faith, make an appropriate adjustment to protect the rights of the Holder; provided, that no such adjustment pursuant to this Section 3(d) will increase  

5 

the Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 3.

4.TRANSFERS AND EXCHANGES OF WARRANT AND WARRANT SHARES 

(a)Registration of Transfers and Exchanges. Subject to Section 4(c), upon the Holder’s surrender of this Warrant, with a duly executed copy of the Form of Assignment attached as Exhibit B, to the Secretary of the Company at its principal offices or at such other office or agency as the Company may specify in writing to the Holder, the Company shall register the transfer of all or any portion of this Warrant. Upon such registration of transfer, the Company shall issue a new Warrant, in substantially the form of this Warrant, evidencing the acquisition rights transferred to the transferee and a new Warrant, in similar form, evidencing the remaining acquisition rights not transferred, to the Holder requesting the transfer. 

(b)Warrant Exchangeable for Different Denominations. The Holder may exchange this Warrant for a new Warrant or Warrants, in substantially the form of this Warrant, evidencing in the aggregate the right to purchase the number of Warrant Shares which may then be purchased hereunder, each of such new Warrants to be dated the date of such exchange and to represent the right to purchase such number of Warrant Shares as shall be designated by the Holder. The Holder shall surrender this Warrant with duly executed instructions regarding such re-certification of this Warrant to the Secretary of the Company at its principal offices or at such other office or agency as the Company may specify in writing to the Holder. 

(c)Restrictions on Transfers. This Warrant may not be transferred at any time without (i) registration under the Securities Act or (ii) an exemption from such registration and a written opinion of legal counsel addressed to the Company that the proposed transfer of the Warrant may be effected without registration under the Securities Act, which opinion will be in form and from counsel reasonably satisfactory to the Company. 

(d)Permitted Transfers and Assignments.  Notwithstanding any provision to the contrary in this Section 4, the Holder may transfer, with or without consideration, this Warrant or any of the Warrant Shares (or a portion thereof) to the Holder’s Affiliates (as such term is defined under Rule 144 of the Securities Act) without obtaining the opinion from counsel that may be required by Section 4(c)(ii), provided, that the Holder delivers to the Company and its counsel certification, documentation, and other assurances reasonably required by the Company’s counsel to enable the Company’s counsel to render an opinion to the Company’s Transfer Agent that such transfer does not violate applicable securities laws. 

5.MUTILATED OR MISSING WARRANT CERTIFICATE 

If this Warrant is mutilated, lost, stolen or destroyed, upon request by the Holder, the Company will, at its expense, issue, in exchange for and upon cancellation of the mutilated Warrant, or in substitution for the lost, stolen or destroyed Warrant, a new Warrant, in substantially the form of this Warrant, representing the right to acquire the equivalent number of Warrant Shares; provided, that, as a prerequisite to the issuance of a substitute Warrant, the Company may require satisfactory evidence of loss, theft or destruction as well as an indemnity from the Holder  

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of a lost, stolen or destroyed Warrant.

6.PAYMENT OF TAXES 

The Company will pay all transfer and stock issuance taxes attributable to the preparation, issuance and delivery of this Warrant and the Warrant Shares (and replacement Warrants) including, without limitation, all documentary and stamp taxes; provided, however, that the Company shall not be required to pay any tax in respect of the transfer of this Warrant, or the issuance or delivery of certificates for Warrant Shares or other securities in respect of the Warrant Shares to any person or entity other than to the Holder.

7.FRACTIONAL WARRANT SHARES 

No fractional Warrant Shares shall be issued upon exercise of this Warrant. The Company, in lieu of issuing any fractional Warrant Share, shall round up the number of Warrant Shares issuable to nearest whole share.

8.NO STOCK RIGHTS AND LEGEND 

No holder of this Warrant, as such, shall be entitled to vote or be deemed the holder of any other securities of the Company that may at any time be issuable on the exercise hereof, nor shall anything contained herein be construed to confer upon the holder of this Warrant, as such, the rights of a stockholder of the Company or the right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or give or withhold consent to any corporate action or to receive notice of meetings or other actions affecting stockholders (except as provided herein), or to receive dividends or subscription rights or otherwise (except as provide herein).

Each certificate for Warrant Shares initially issued upon the exercise of this Warrant, and each certificate for Warrant Shares issued to any subsequent transferee of any such certificate, shall be stamped or otherwise imprinted with a legend in substantially the following form: 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR ANY STATE SECURITIES OR “BLUE SKY LAWS,” AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.” 

9.REGISTRATION UNDER THE SECURITIES ACT OF 1933 

The Company is not obligated to register the resale of the Warrant or the Warrant Shares under the Securities Act.   

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10.REPORTS TO THE SEC 

The Company is presently not current in its reporting obligations under the Exchange Act and will use its best efforts to file all reports required to be filed by it under the Exchange Act.   

11.NOTICES 

All notices, consents, waivers, and other communications under this Warrant must be in writing and will be deemed given to a party when (a) delivered to the appropriate address by hand or by nationally recognized overnight courier service (costs prepaid); (b) sent by facsimile or e-mail with confirmation of transmission by the transmitting equipment; (c) received or rejected by the addressee, if sent by certified mail, return receipt requested, if to the registered Holder hereof; or (d) seven days after the placement of the notice into the mails (first class postage prepaid), to the Holder at the address, facsimile number, or e-mail address furnished by the registered Holder to the Company in accordance with the Subscription Agreement by and between the Company and the Holder, or if to the Company at its corporate address, Attention: Frank Mueller, Chief Financial Officer. 

12.SEVERABILITY 

If a court of competent jurisdiction holds any provision of this Warrant invalid or unenforceable, the other provisions of this Warrant will remain in full force and effect. Any provision of this Warrant held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

13.BINDING EFFECT 

This Warrant shall be binding upon and inure to the sole and exclusive benefit of the Company, its successors and assigns, the registered Holder or Holders from time to time of this Warrant and the Warrant Shares.

14.SURVIVAL OF RIGHTS AND DUTIES 

This Warrant shall terminate and be of no further force and effect on the earlier of 5:00 P.M., Central Time, on the Expiration Date or the date on which this Warrant has been exercised in full.

15.GOVERNING LAW 

This Warrant will be governed by and construed under the laws of the State of New Mexico without regard to conflicts of laws principles that would require the application of any other law.

16.DISPUTE RESOLUTION 

In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or

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arithmetic calculations via facsimile within two Business Days of receipt of the Notice of Exercise giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days, submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than ten (10) Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

17.NOTICES OF RECORD DATE 

Upon (a) any establishment by the Company of a record date of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, or right or option to acquire securities of the Company, or any other right, or (b) any capital reorganization, reclassification, recapitalization, merger or consolidation of the Company with or into any other corporation, any transfer of all or substantially all the assets of the Company, or any voluntary or involuntary dissolution, liquidation or winding up of the Company, or the sale, in a single transaction, of a majority of the Company’s voting stock (whether newly issued, or from treasury, or previously issued and then outstanding, or any combination thereof), the Company shall mail to the Holder at least ten (10) Business Days, or such longer period as may be required by law, prior to the record date specified therein, a notice specifying (i) the date established as the record date for the purpose of such dividend, distribution, option or right and a description of such dividend, option or right, (ii) the date on which any such reorganization, reclassification, transfer, consolidation, merger, dissolution, liquidation or winding up, or sale is expected to become effective and (iii) the date, if any, fixed as to when the holders of record of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reorganization, reclassification, transfer, consolation, merger, dissolution, liquidation or winding up.

18.RESERVATION OF SHARES 

The Company shall reserve and keep available out of its authorized but unissued shares of Common Stock for issuance upon the exercise of this Warrant, free from pre-emptive rights, such number of shares of Common Stock for which this Warrant shall from time to time be exercisable.  The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation. Without limiting the generality of the foregoing, the Company covenants that it will use commercially reasonable efforts to take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and use commercially reasonable efforts to obtain all such authorizations, exemptions or consents, including but not limited to consents from the Company’s

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stockholders or Board of Directors or any public regulatory body, as may be necessary to enable the Company to perform its obligations under this Warrant.

19.NO THIRD-PARTY RIGHTS 

This Warrant is not intended, and will not be construed, to create any rights in any parties other than the Company and the Holder, and no person or entity may assert any rights as third-party beneficiary hereunder.

20.SECTION HEADINGS 

The Section headings in this Warrant are for purposes of convenience only and shall not constitute a part hereof. 

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of the date first set forth above.

SANTA FE GOLD CORPORATION

By: ___________________________

Name:Stephen J. Antol 

Title:Chief Financial Officer 

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EXHIBIT A

NOTICE OF EXERCISE

(To be executed by the Holder of Warrant if such Holder desires to exercise Warrant)

To Santa Fe Gold Corporation:

The undersigned hereby irrevocably elects to exercise this Warrant and to purchase thereunder, ___________________ full shares of Santa Fe Gold Corporation common stock issuable upon exercise of the Warrant and delivery of:

$_________ (in cash as provided for in the foregoing Warrant) and any applicable taxes payable by the undersigned pursuant to such Warrant.

The undersigned requests that certificates for such shares be issued in the name of:

_________________________________________

(Please print name, address and social security or federal employer
identification number (if applicable))

_________________________________________

_________________________________________

If the shares issuable upon this exercise of the Warrant are not all of the Warrant Shares which the Holder is entitled to acquire upon the exercise of the Warrant, the undersigned requests that a new Warrant evidencing the rights not so exercised be issued in the name of and delivered to: 

_________________________________________

(Please print name, address and social security or federal employer

identification number (if applicable))

_________________________________________

_________________________________________

Name of Holder (print):_____________________________ 

(Signature):______________________________________ 

(By:)___________________________________________ 

(Title:)__________________________________________ 

Dated:__________________________________________ 

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EXHIBIT B

FORM OF ASSIGNMENT

FOR VALUE RECEIVED, ___________________________________ hereby sells, assigns and transfers to each assignee set forth below all of the rights of the undersigned under the Warrant (as defined in and evidenced by the attached Warrant) to acquire the number of Warrant Shares set opposite the name of such assignee below and in and to the foregoing Warrant with respect to said acquisition rights and the shares issuable upon exercise of the Warrant:

Name of Assignee Address Number of Shares

If the total of the Warrant Shares are not all of the Warrant Shares evidenced by the foregoing Warrant, the undersigned requests that a new Warrant evidencing the right to acquire the Warrant Shares not so assigned be issued in the name of and delivered to the undersigned.

Name of Holder (print):_________________________ 

(Signature):__________________________________ 

(By:)_______________________________________ 

(Title:)______________________________________ 

Dated:______________________________________ 

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EX-10.1

PURCHASE AGREEMENT

This PURCHASE AGREEMENT (the "Agreement")is effective January 04, 2019 (the "Effective Date").

BETWEEN: Billali Mine, LLC and JC Imperial, LLC (collectively hereinafter the "Seller"), both entities are limited liability companies organized and existing under the laws of the state of Arizona, with their primary mailing address located at:

P.O. Box 207 Duncan, AZ 85534

AND:Mineral Acquisitions, LLC (the "Buyer"), a limited liability company organized and existing under the laws of the State of New Mexico, with its offices located at: 

P.O. Box 25201

Albuquerque, New Mexico 87125

RECITALS

A.Seller is the owner of: 

1.The Billali Lode patented mining claim Patent No. 1021 situated in the Steeple Rock Mining District, Grant County, New Mexico in Section 26, Township 16 South, Range 21 West and is known as The Billali Mine permitted under the State of New Mexico Permit No. GR058MN (the "Billali"). 

2.Patented mining claims and unpatented mining claims as set forth on Exhibit A 

3.The Lessee's interest in that certain Lease Agreement dated October 28, 2003 by and between Walt Anderson, Lessor, and Leslie Billingsley and Richard Billingsley, collectively Lessee, a true and correct copy of which is attached hereto as Exhibit B (the Water Lease). 

B.Buyer desires to purchase the interests of Seller in the Billali, the Jim Crow and Imperial Mines, the Water Lease upon the terms and conditions herein set forth. 

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C.Seller desires to sell its interests in the Billali, the Jim Crow and Imperial Mines and the Water Lease to Buyer upon the terms and conditions herein set forth. 

AGREEMENT

FOR AND IN CONSIDERATION of the payments herein required, the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer (the "Parties" and individually a "Party") agree as follows:

SALE AND ASSIGNMENT BY SELLER TO BUYER

A The Seller agrees to sell, and Buyer agrees to purchase the real properties described in Recital Paragraph A, the patented and unpatented mining clams described in Recital Paragraph B and Seller agrees to assign all of its right title and interest in the Water Lease described in Recital Paragraph C.

B Grant of Use. To the extent required and if any access is owned by Seller and not otherwise conveyed Seller hereby grants use of and access to the Billali, Jim Crow and Imperial Mines to Buyer and its permitted successors and assigns.

C Rights of Buyer. Buyer shall have the following rights in respect of the Billali, Jim Crow and Imperial Mines:

i)Surface. Mining and Access Rights. Subject only to any limitations imposed by federal, state and local regulations, the free, unrestricted and uninterrupted right of access, ingress and egress to the Billali, Jim Crow and Imperial Mines over existing roads or alternate routes approved by Seller and the right to enter upon and occupy the Billali, Jim Crow and Imperial Mines for all purposes reasonably incident to exploring for, developing, mining (by underground mining, surface mining, strip mining or any other surface or subsurface method, including any method later developed), extracting, milling, smelting, refining, stockpiling, storing, processing, removing and marketing there from all ores, metals, minerals, mineral products (including intermediate products) and materials of every nature or sort, and the right to place, construct, maintain, use and thereafter remove such structures, facilities, equipment, roadways, haulage ways, utility lines, reservoirs and water courses, and other improvement as may be necessary, useful or convenient for the full enjoyment of all of the rights granted under this Agreement. Buyer shall have sole and exclusive custody, possession, ownership and control of all ore, rock, drill core and other mineral substances extracted or removed from the Billali, ae4 Jim Crow and Imperial Mines and may sell or otherwise dispose thereof. 

ii)In the exercise of such rights, Buyer shall be subject only to compliance with applicable statutes, rules , regulations and the terms of this Agreement. These rights are also granted 

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and may be utilized for the purpose or in the course of carrying on exploration, development or mining operations on any other properties in which Buyer may have or acquire any right or interest, provided Seller assents to the same.

iii)Commingling. The right to commingle ore removed from the Billali and Jim Crow or products derived therefrom after treatment, with other ore or products, before or after concentration or beneficiation, so long as the data necessary to determine the weight, grade, and recoverability of both the ore removed from the Billali, Jim Crow and Imperial Mines or products derived therefrom and the ore or products with which it is commingled are obtained by Buyer. Buyer shall then use that data to determine Seller's interest in minerals, metals and/or other products extracted from ores or products so mixed. Such data and determinations shall be acquired and completed in accordance with generally accepted industry practices. 

iv)Treatment. The right, at Buyer's election and in any manner, it deems fit, to beneficiate, concentrate, process, smelt, refine, and otherwise treat on or off the Billali and Jim Crow any mineral substances taken from the Billali, Jim Crow and Imperial or from adjoining or nearby properties by any physical or chemical method or methods.  In exercising this right, mineral substances may be removed to a plant or plants existing, established or maintained upon the Billali, Jim Crow and Imperial Mines or elsewhere, subject to accurate metallurgical accounting and prompt reporting to Seller. 

v)Water Rights. The right to use any of Seller's water rights, which rights are hereby assigned, on, about, under or appurtenant to the Billali and Jim Crow to facilitate the exploration, mining and processing rights granted in this Agreement. 

2PAYMENTS TO SELLER  

A Purchase Price.

i)The allocation of the Total Purchase Price for all rights and interests of the Billali conveyed herein is Two 1\t1illion Five Hundred Thousand Dollars ($2,500,000.00). 

ii)The allocation of the Total Purchase Price for all rights and interests of the Jim Crow conveyed herein and the assignment of the Water Lease is Seven Million Five Hundred Thousand Dollars ($7,500,000.00). 

iii)The Total Purchase Price is Ten Million Dollars ($10,000,000.00). 

B Payment of the Purchase Price. The Total Purchase Price Will be paid as follows:

i)Twenty-Five Thousand Dollars ($25,000.00) upon closing of the transaction described herein. 

ii)One Hundred Thousand Dollars ($100,000.00) on or before January 31, 2019 . 

iii)One Hundred Thousand Dollars ($100,000.00) on or before February 28, 2019. 

iv)Commencing on July 02, 2019 and on the 30th day of each month thereafter for a 

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period of twenty (20) months Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000.00) per month.

v)Commencing on March l, 2021 and on the 1st day of each month thereafter for a period of fifty (50) months Buyer will pay to Seller the sum of One Hundred Seventy-Five Thousand Do11ars ($175,000.00) per month. 

vi)Each payment made hereunder will be allocated Twenty-Five per cent (25%) to the Billali and Seventy-Five percent (75%) to the Jim Crow, Imperial. 

3TITLE MATTERS 

A Representations and Warranties. Seller covenants and warrants to Buyer, which covenants and warranties shall survive termination of this Agreement, as follows:

i)Seller warrants, to the best of its knowledge and belief, that except for a 5% NSR royalty payable to Veris Gold USA Inc., there are no claims, actions, suits or proceedings pending or threatened on account of or as a result of ownership of the real property which, if adversely determined, would prevent or hinder the conditions contained in this Agreement. 

ii)Seller warrants, to the best of its knowledge and belief, it has good and merchantable title to the Billali and the patented/unpatented mining claims as set forth in Exhibit "A" including any reservations contained in patents issued by the United States of America. As to said patented and unpatented claims, that Seller has not entered into any leases, licenses, casements or other agreements, recorded or unrecorded, granting rights to any parties in any of the property and no person or other entity has any right to possess any portion of the property. 

iii)Seller warrants that it has no knowledge of violation of law or ordinance with respect to the use of ownership of the property. 

iv)Seller warrants it has full right, power and capacity to enter  into this  Agreement  under the terms set forth herein. 

v)Buyer shall have quiet and peaceable possession of the Billali and Jim Crow Imperial Mines. 

vi)Seller has no knowledge or information indicating that any reclamation obligations for prior operations on the Billali, Jim Crow and Imperial Mines are unsatisfied. 

vii)Seller warrants that the patented and unpatented claims are in good standing and all required payments to maintain the claims have been timely made, and no liens or encumbrances exist. 

viii)Seller has no knowledge of any existing or threatened violations of  any federal  or state environmental laws or regulations as a result of any condition on the Billali and Jim Crow and Imperial Mines. 

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ix)Title Defects. Defense and Protection. Buyer may at any time cause a title search to be made covering all or any part of the Billali, Jim Crow and Imperial Mines. Seller  shall provide Buyer with any abstracts and other evidences of title in Seller' s possession or control. If, (1) in the opinion of Buyer, Seller's title to all or any part of the Billali and Jim Crow and Imperial Mines are defective or less than as represented in Section 3(A); or (2) Seller's title is contested or questioned by any person or entity Buyer shall notify Seller and Seller shall promptly defend title or correct the alleged defects with thirty (30  days after receipt of written notice In the event Seller is unable or unwilling to promptly correct the alleged defects or defend title, Buyer may attempt to perfect or defend Seller's title. In that event, Seller shall cooperate as reasonably necessary to assist Buyer in its efforts to perfect or defend Seller's title. time being of the essence. Any money expended by Buyer to perfect or defend Seller's title shall be deductible from the payment set forth in Section 2(B) for the month in which such money is spent. Any improvement or perfection of title to the Billali, Jim Crow and Imperial Mines shall inure to the benefit of Buyer in the same manner and to the same extent as if such improvement or perfection had been made prior to the execution of this Agreement. In the event any title defect(s) is discovered after closing and said defect(s) is not cured by either the Seller and/or Buyer the Buyer may at its sole discretion waive the title defect(s) and proceed with the transaction as if the title defect had not been discovered or Buyer may declare this Agreement to be null and void and Buyer shall within thirty (30) days refund to Buyer all money it has paid pursuant to this Agreement. ln the event the Buyer exercises its discretion to declare the Agreement null and void the parties shall upon payment of the sums required to be paid by Seller to Buyer execute all documents necessary to convey, without any restriction, liens or encumbrance, the Billali. the Jim Crow, Imperial Mines and the Water Lease to Seller. In the event the Buyer declares the Agreement to null and void it will make no claim of any nature whatsoever for any improvements it may have made to the Billali and/or the Jim Crow. 

4OBLIGATIONS OF BUYER 

A Outstanding Mineral Interests. Buyer has conducted a mineral review of the Billali and Jim Crow claims described in Exhibit "A". Based on said review, Buyer is not aware of any defects in Seller's title, nor of any other matter that would cause Seller's warranties and representations made herein to be untrue.

B Protection from Liens. Buyer shall keep title to the Billali, Jim Crow and Imperial Mines free and clear from any liens, claims and encumbrances (other than liens for taxes not yet due and delinquent) arising from its operations hereunder. Buyer shall promptly pay for all labor performed upon or material furnished to the Billali, Jim Crow and Imperial Mines at the request of Buyer and shall keep the Billali, Jim Crow and Imperial Mines free and clear from liens of mechanics or materialmen in connection with services performed and material supplied at Buyer's request. Buyer shall, however, have the right in good faith to

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contest the validity of any lien, claim or liability and shall not  be required to remove any such lien , claim or liability so long as Buyer is contesting the validity or the amount thereof The foregoing provision s shall not restrict Buyer from placing a mortgage , trust deed or other lien upon its interest in the Billali, Jim Crow and Imperial Mines for financing purposes, so long as said encumbrance is subordinate to the rights of Seller to terminate this Lease for nonperformance in accordance with its terms . The restrictions set forth in this section shall remain in full force and effect until such time as the Total Purchase Price has been paid in full.

C Taxes and Assessments . Until the Total Purchase Price has been paid in full and except  as provided below, Buyer shall pay promptly before delinquency all taxes and assessments that may be assessed during the term of this Agreement upon the Billali, Jim Crow and Imperial Mines resulting from Buyer's activities and products derived therefrom. This includes all assessments payable to maintain the integrity of the mining claims, on an annual basis, due and payable to Grant County or other required State or US Federal agencies. Buyer will defend the rights  of Seller with respect to other individuals that prospect or overstake Seller's mining claims. However, Buyer shall always have the right to contest, in the courts or otherwise, either in its own name or in the name of Seller, the validity or amount of any such taxes or assessments, or to take such other steps or proceedings as it may deem necessary to secure a cancellation, reduction, readjustment or equalization thereof, before it shall be required to pay such taxes or assessments. Notwithstanding the foregoing, Buyer shall not permit any part of the Billali, Jim Crow and Imperial Mines to be conveyed and title lost as the result of nonpayment of such taxes and assessments. Buyer shall provide Seller with copies of all receipts evidencing payment of such taxes and assessments. If Seller should receive tax bills or claims that arc the responsibility of Buyer, Seller shall promptly forward such bills or claims to Buyer for appropriate action.  Buyer shall pay the above-referenced taxes that are assessed from the Effective Date of this Agreement to its date of tem1ination. Nothing in this paragraph shall be construed to obligate Buyer to pay that portion of any tax based upon an assessment of improvements or structures made or placed on the Billali, Jim Crow and Imperial Mines by Seller. Buyer shall not be liable for any taxes levied on or measured by Seller's income or based upon payments made to Seller by Buyer under this Agreement.

D Compliance with Laws and Regulations . Until the Total Purchase Price has been paid in full Buyer shall perform all of its operations on the Billali, Jim Crow and Imperial Mines in compliance with all applicable Federal, State and local laws and regulations pertaining to environmental protection, reclamation and bonding, and any other regulatory authority having rightful jurisdiction in the conduct of exploration, development and production operation s on the Billali, Jim Crow and Imperial Mines including without limitation, requirements applicable to the plugging of drill holes and reclaiming, re-contouring and re-seeding of drill pads, trenches , access roads and other disturbances. Buyer shall have no obligations with respect to prior operations or preexisting conditions on the Billali, Jim Crow and Imperial Mines. The indemnification obligations of Buyer pursuant to Section

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5.C shall specifically be applicable to all of Buyer's environmental obligations. The obligations of Buyer under this Section 4(D) shall survive termination of this Agreement.

E Seller's Right to Inspect. During the ten11 of this Agreement Buyer shall allow Seller and representatives of Seller, at their sole risk and expense, access to the Billali, Jim Crow and Imperial Mines for the purposes of viewing or inspecting Buyer's operations, at times which. in Buyer's discretion, do not unreasonably interfere with its operations. Seller and Seller's representatives agree to indemnify, protect, save and hold harmless Buyer and its affiliated and direct and indirect parent corporations and their respective directors, partners, officers, employees, agents and corporate affiliates from and against any and all losses, costs, damages, expenses, attorney fees, claims, demands, liabilities, suits and actions of every kind and character that may be imposed upon or incurred by Buyer and its affiliated and direct and indirect parent corporations and their respective directors, partners, officers, employees, agents or corporate affiliates on account of, or arising directly or indirectly from, Seller's rights under this Section 4(E) Seller acknowledges and agrees that information obtained pursuant to this Section 4(E) shall be subject to the confidentiality provisions set forth in Section 10 hereof. BUYER ACKNOWLEDGES, WARRANTS AD AGREES THE TRANSACTION DESCRIBED HEREIN IS A "WHERE IS, AS IS"TRANSACTION AND SELLER MAKES NOW ARRANTIES OR REPRESENTATION OF ANY NATURE WHATSOEVER EXCEPT THOSE SET FORTH IN THIS AGREEMENT.

F No Obligation to Mine. Nothing in this Agreement shall impose any obligation or covenant, express or implied, upon Buyer to conduct any exploration, development or mining operations upon the Billali, Jim Crow and Imperial Mines, it being the intent of the Parties that Buyer shall have sole discretion to determine the technical and economic feasibility, tinting, method, manner and rate of conducting any such operations. Only the express duties and obligations provided under this Agreement shall be binding upon Buyer. The nature, manner and extent of all exploration development, mining and other operations, if any, shall be matters to be determined solely within the discretion of Buyer.

5OBLIGATIONS OF SELLER 

Cooperation by Seller. Seller shall execute all documents and otherwise cooperate with Buyer as needed in connection with the conduct of operations on the Billali, Jim Crow and Imperial Mines including the transfer of ownership of the existing Permit to Buyer, acquisition of additional governmental permits, post-mining reclamation approvals, water rights, and other rights and privileges related to the conduct of operations on the Billali and Jim Crow and reclamation thereof . In that regard, Seller agrees not to protest, challenge or otherwise oppose any water right or operational permit filings that Buyer may make to facilitate operations or proposed operations on or in connection with the Billali, Jim Crow and Imperial Mines.

6TERMINATION 

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A Termination by Seller. In the event Seller declares that Buyer has not complied with any obligation hereunder, Seller shall notify Buyer setting out specifically in what respect it is claimed that Buyer has breached this Agreement. If the alleged breach is not cured within 30 days after notice is given of default or if Buyer has not within that time either commenced to cure the alleged breach and does not thereafter diligently complete such cure Seller may terminate this Agreement by delivering to Buyer written notice of such termination; provided, however, that in the event Buyer challenges the legitimacy of the allegation Buyer may give written notice to Seller within such 30-day period setting forth such fact. If Seller gives written notice within 15 days of Buyer's notice that Seller rejects Buyer's position then this Agreement shall not be terminable by Seller until there is a final judicial determination by a court of competent jurisdiction that a default exists and shall not be terminated thereafter if Buyer shall satisfy such judgment within 30 days following its entry (or if an appeal of such judgment is taken following its affirmance by the highest court to which such an appeal is made). Failure of Seller to give such notice shall constitute agreement by Seller that Buyer is not in default. Seller shall not be entitled to terminate this Agreement for any default which by its nature is not retroactively curable if Buyer has used its best efforts to cure such a default to the extent practical or if Buyer has paid Seller's damages for such default where damages are an appropriate remedy. Seller shall have no right to terminate this Agreement except as expressly provided in this Section 6(A), and termination of this Agreement shall be the sole remedy of Seller. Neither the service of any notice nor the performance of any acts by Buyer intended to meet any such alleged breach shall be deemed an admission or presumption that Buyer has failed to perform all of its obligations under this Agreement.

B Termination by Buyer. Buyer shall have the right to terminate this Agreement at any time with respect to the Billali, Jim Crow, Imperial Mines and the Water Lease by giving Seller written notice of such termination. Tc1mination shall not cause a reduction in the payments already made according to Section 2(B). Upon such termination, all right, title and interest of Buyer under this Agreement shall terminate with respect to the Billali, the Jim Crow, Imperial Mines and the Water Lease. Buyer shall be relieved of all further obligations set forth in this Agreement as to the Billali, the Jim Crow, Imperial Mines and the Water Lease affected except those obligations, if any, which have accrued prior to such termination. Any taxes, assessments and governmental charges for which Buyer was responsible prior to termination shall be prorated as of the termination date.  ln the event The Buyer terminates this Agreement pursuant to this Section it shall immediately surrender possession of the Billali, the Jim Crow, Imperial Mines and re-assign the Water Lease. Buyer shall make no claim of any nature whatsoever for any improvements it may have made to the Billali and/or the Jim Crow. The Buyer shall immediately execute all documents necessary to transfer the Billali, the Jim Crow and re-assign the Water Lease to Seller.

C Release. Following termination of this Agreement as to all or a part of the Billali and Jim Crow, Buyer shall promptly deliver to Seller a fully executed release of this Agreement

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in recordable form.

D Reclamation: Removal of Property. Upon termination of this Agreement, Buyer shall have a continuing right to enter upon the Billali, Jim Crow and Imperial Mines to complete required reclamation required as a result of Buyer' s activities on the Billali, Jim Crow and Imperial Mines. Buyer shall within ninety (90) days after the date of termination remove from the Billali, Jim Crow and Imperial Mines all of its machinery, buildings, structures, facilities, equipment and other property of every nature and description erected, placed or situated thereon except foundations of a permanent nature, supports, track and pipe placed in shafts, drifts or openings in the Billali, Jim Crow and Imperial Mines. Any property of Buyer not removed by the end of this ninety day period shall become the property of Seller; however, Buyer does not warrant the condition or safety of any such property. Buyer  shall have the right to keep a watchman on the Billali, Jim Crow and Imperial Mines during this ninety day period.

E Return of Mine Permit. Upon termination of this Agreement by Buyer, Buyer shall execute all documents and otherwise cooperate with Seller as needed in connection with the conduct of operations on the Billali and Jim Crow and Imperial Mines including returning ownership of the existing Permit to Seller.

7LIENS 

In the event that Buyer fails to promptly pay, when due, taxes, mortgages or other liens levied against the Billali, Jim Crow and Imperial Mines payable by Buyer, Seller shall have the right (but shall not be obligated) to pay such past due amounts and, if Seller does so, Seller shall be subrogated to all the rights of the holders thereof and Buyer shall reimburse Seller for all such payments and for all related costs and expenses paid or incurred by Seller (including, without limitation, related attorney fees) within 30 days after the same are paid or incurred by Seller. The provisions of this Section shall survive termination of thisAgreement.

8FORCE MAJEURE 

Buyer shall not be liable for failure to perfom1 any of its obligations, other than making payments due under Section 2, during any period in which performance is prevented, in whole or in part, by causes herein termed Force Majeure. For purposes of this Agreement, the termed "Force Majeure" shall include labor disputes; acts of God; action of the elements, including inclement weather, floods, slides, cave-ins, sinkholes, earthquakes and drought; laws, rules, regulations, orders, directives and requests of governmental bodies or agencies; acts of war or conditions arising out of or attributable to war, whether declared or undeclared: riot; civil strife; fire; explosion; or any other cause whether similar or dissimilar to the foregoing. except for the inability to meet financial commitments. If Buyer invokes the provisions of this Section, Buyer shall give notice of the commencement of the circumstances giving rise to such Force Majeure.  The time for discharging Buyer's obligations with respect to the prevented

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performance, or the time within which Buyer must undertake or complete any activity, shall then be extended for the period of Force Majeure.

9NOTICES AND METHODS OF MAKING PAYMENTS 

A Notices. Any required notice or communication shall be in writing and shall be effective when personally delivered (including delivery by express courier service) to the following addresses, or when addressed as follows and deposited, postage prepaid, in the United States mail for certified delive1y:

If to Seller:Billali Mine LLC J C Imperial, LLC 

P.O. Box 207

Duncan, AZ 85534, and

Billali Mine LLC

P.O. Box 945 Duncan,

AZ 85534

If to Buyer:Mineral Acquisitions, LLC 

P.O. Box25201

Albuquerque, New Mexico 87125

Either party may, by notice to the other given as aforesaid, change its mailing address for future notices.

10CONFIDENTIALITY 

Seller shall not, without the express written consent of Buyer not to be unreasonably withheld, disclose any information concerning the terms of this or operations conducted under this Agreement (except information and data that is generally available to the public), nor issue any press releases concerning suchinfo1mation.

11MISCELLANEOUS 

A Relationship of the Parties. Nothing contained herein shall be deemed to constitute either Party, in its capacity as such, the partner, agent or legal representative of the other Party, or to create any partnership, mining partnership or other partnership relationship, or fiduciary relationship between them, for any purpose whatsoever. Except as expressly provided in this Agreement, each Party shall have the free, unrestricted and  independent right to engage in and receive the full benefits of any and all business endeavors of any sort whatsoever outside the Billali and Jim Crow or outside the scope of this Agreement, whether or not competitive with the endeavors contemplated herein, without consulting

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the other or inviting or allowing the other therein.

BTransfers. Buyer and its respective successors shall have the right to assign or otherwise transfer their respective interests in this Agreement in whole or in part provided that  the transferee agrees in writing to assume all, or a portion of all if applicable, obligations of Buyer hereunder, and Buyer shows Seller, in writing, that the proposed transferee is financially and technically able to comply with the obligations of the Buyer  under  this Lease, and, in that event, Seller shall be obligated to consent to the transfer, with the understanding that Buyer remains secondarily liable under this Lease.  No such transfer shall be effective until the Seller receives written notice of the proposed transfer in accordance with Section 10, and consents in writing to the same. 

CPayments After a Transfer of Interest. In the event payments should be made to other parties because of any transfer of the interest of any of the persons constituting Seller, payments tendered to the Seller making the transfer or Seller's designated agent, shall conclusively be deemed payment to the transferee until Buyer receives notice and evidence satisfactory to it from both the agent (if applicable) and the transferring Seller that the transferor's interest has been transferred and that payments should be made to the transferee or the transferee's designated agent. 

DBinding Effect. Subject to the provisions of Section 1l(B) above, the provisions of this Agreement shall inureto the benefit of and be binding upon the Parties and their respective heirs, executors, administrators, personal representatives, beneficiaries, successors and assigns. 

EConstruction of Agreement. This Agreement and its Exhibits constitute the entire understanding of the Parties with respect to the Billali, Jim Crow, Imperial Mines and the Water Lease, all previous agreements, promises, representations, negotiations, writings and understandings between the Parties being expressly rescinded. Except for obligations of good faith and fair dealing, there are no terms or conditions, express or implied, other than herein stated. This Agreement shall be subject to all valid and applicable provisions of statutory or common law, rules and regulations. Should this Agreement or any of its provisions or operations be found to be contrary to any such valid law, rule or regulation, the latter shall be deemed to control, and this Agreement shall be regarded as modified accordingly: Subject to the preceding sentence, no modification or alteration of this Agreement shall be effective unless made in _\\Titing and executed by the Parties with the same formality as this Agreement. There shall be no modification or amendment by virtue of course of conduct by either party. There shall be no modification or amendment by virtue of any concept of an oral modification of a written agreement. Wherever the term "including" is used herein, it shall be deemed to mean "including without limitation," and wherever the phrase "shall include" is used herein, it shall mean "shall include without limitation." 

FHeadings. The headings used herein are for convenience only and shall be disregarded m construing and enforcing this Agreement. 

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GRule Against Perpetuities. The Parties do not intend nor desire for this Agreement to violate the common law Rule Against Perpetuities or any analogous statutory provision or any other statutory or common law rule imposing time limits on the vesting or termination of estates in land. If any provision of this Agreement does or would violate the Rule Against Perpetuities or any analogous statutory provision or any other statutory or common law rule imposing time limits on the vesting or termination of estates in land, then this Agreement shall not be deemed void or voidable but shall be interpreted in such a way as to maintain and carry out the Parties' objectives to the fullest extent possible by law. 

HApplicable law. This Agreement shall be construed, interpreted and governed by the laws of the State of New Mexico. 

IAttorney Fees. In the event either Party brings any action or proceeding for damages or equitable relief against the other Party for an alleged breach or default of any provision of this Agreement to recover monies due or to enforce, protect or establish any right or remedy of either Party under this Agreement, the prevailing Party shall be entitled to recover as a part of such action or proceeding reasonable attorney fees and court costs. 

JDisputes. Disputes or differences between the Parties shall not interrupt performance of this Agreement or the continuation of operations hereunder, In the event of any dispute or difference, operations may be continued, and payments may be made hereunder in the same manner as prior to such dispute or difference. ln case of suit, adverse claim, dispute or question as to the ownership of the Billali, Jim Crow, Imperial Mine and/or the Water Lease, or any interest therein. Buyer may, in its sole discretion, deposit the payment (or the portion of the payment in dispute, if less than the whole payment, is in dispute) into an escrow account and Buyer shall not be held in default in payment thereof until such suit, claim, dispute or question has been finally disposed of. 

KMultiple Counterparts. This Agreement may be executed in multiple counterparts and all counterparts taken together shall be deemed to constitute one and the same document 

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EX-10.2

 

 

EX-10.3

 

 

EX-10.4

AMENDMENT NO. 3 TO PURCHASE AGREEMENT

This amendment no. 3 (the “Amendment”) amends the purchase agreement by and between Billali Mine, LLC and JC Imperial, LLC (collectively, the “Seller”) and Mineral Acquisitions, LLC (“Buyer”) dated on or about January 4, 2019, amended on March 7, 2019, and further amended on January 21, 2020 (collectively referred to as the “Purchase Agreement”), and is dated effective May 1, 2020 (“Effective Date”).

WHEREAS, the Seller and Buyer desire to amend the Purchase Agreement to reflect revised payment terms of the Purchase Agreement;

NOW, THEREFORE, in consideration of the above, and for other good and valuable consideration including the desire to work together during the COVID-19 pandemic and concurrent economic uncertainty, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.Amended and Restated Section 2.B. Section 2.B of the Purchase Agreement is hereby amended and restated in its entirety as follows: 

“B. Payment of the Purchase Price. The Total Purchase Price will be paid as follows:

(i)Fifty Thousand Dollars ($50,000) has been paid by Buyer to Seller on or about the Effective Date as noted above. 

(ii)Commencing July 1, 2020, and continuing with 19 subsequent payments every 30 days thereafter, Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000.00) per period. 

(iii)Commencing 30 days after the last payment in (ii) above and continuing with 48 subsequent payments every 30 days thereafter, Buyer will pay to Seller the sum of One Hundred Seventy-Five Thousand Dollars ($175,000.00) per period with 49th and final payment in the amount of One Hundred and Fifty Thousand Dollars ($150,000.00) completing purchase. 

(iv)Each payment made hereunder will be allocated Twenty-Five per cent (25%) to the Billali and Seventy-Five percent (75%) to the Jim Crow, Imperial group of mines as previously outlined.” 

2.No Other Amendments or Supplements. Except as set forth in Sections 1 and 7 hereof, the Purchase Agreement shall remain in full force and effect as currently in effect. 

3.Severability. Should any one or more of the provisions of this Amendment be determined to be illegal or unenforceable, all other provisions of this Amendment shall be given effect separately from the provision or provisions determined to be illegal or unenforceable and shall not be effected thereby. 

 

EX-10.5

AMENDMENT NO. 4 TO PURCHASE AGREEMENT

This amendment no. 4 (the "Amendment") amends the purchase agreement by and between Billali Mine, LLC and JC Imperial, LLC (collectively, the "Seller") and Mineral Acquisitions, LLC ("Buyer") dated on or about January 4, 2019, amended on March 8, 2019, further amended on January 21, 2020 and further amended on May 1, 2020 (collectively referred to as the "Purchase Agreement"), and is dated effective October 7, 2020 ("Effective Date").

WHEREAS, the Seller and Buyer desire to amend the Purchase Agreement to reflect revised payment terms of the Purchase Agreement;

NOW, THEREFORE, in consideration of the above, and for other good and valuable consideration including the desire to work together during the COVID-19 pandemic and concurrent economic uncertainty, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

I.Amended and Restated Section 2.B. Section 2.B of the Purchase Agreement is hereby amended and restated in its entirety as follows: 

"B. Payment of the Purchase Price. The Total Purchase Price of $10,000,000 will be paid as follows:

(i)Six Hundred Thousand Dollars ($600,000) has been paid by Buyer to Seller as of the date of this Amendment. 

/

(ii)Commencing November l, 2020 and continuing on the first day of each 

subsequent month thereafter, a monthly payment of $25,000 will be paid until (A) the mill processing plant to create concentrate is in operation and

(B) we received our first payment for shipment of such concentrate from 

the mill (satisfaction of these two items is referred to as "Milestone"). Upon

satisfaction of this Milestone and commencing on the first day of the following month and continuing the first day of each subsequent month thereafter, Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000) until a total of One Million Six Hundred Thousand Dollars ($1,600,000 is paid.

(iii)Commencing 30 days after the last payment in (ii) above and continuing with 48 subsequent payments every 30 days thereafter, Buyer will pay to Seller the sum of One Hundred Seventy-Five Thousand Dollars ($175,000.00) per period. 

(iv)Each payment made hereunder will be allocated Twenty-Five per cent (25%) to the Billali and Seventy-Five percent (75%) to the Jim Crow, Imperial." 

2.No Other Amendments or Supplements. Except as set forth in Sections 1 and 7 hereof, the Purchase Agreement shall remain in full force and effect as currently in effect. 

3.Severability. Should any one or more of the provisions of this Amendment be determined to be illegal or unenforceable, all other provisions of this Amendment shall be given effect separately from the provision or provisions determined to be illegal or unenforceable and shall not be effected thereby. 

4.Counterparts.This Amendment may be executed in multiple counterparts with the same effect as if all parties had signed the same document. All such counterparts shall be deemed an original, shall be construed together and shall constitute one and the same instrument. 

5.Entire Agreement. This Amendment and the Purchase Agreement constitute the full and entire understanding and agreement between the parties with respect to the subject matter hereof. 

6.Defined Terms. Defined terms used in this Amendment shall have the meaning ascribed to them herein or in the Purchase Agreement. 

7.Waiver of Events of Default. As of the Effective Date, Seller hereby waives each and every breach and event of default of Buyer in the Purchase Agreement, and Seller and Buyer hereby confirm and acknowledge that the Purchase Agreement and this Amendment are binding on each other and in full force and effect. 

IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment or has caused this Amendment to be executed on its behalf by a representative duly authorized, all as of the date first above set forth.

SELLER:BUYER: 

Billali, LLC and JC Imperial, LLCMineral Acquisition, LLC 

 

2

EX-10.6

 

 

EX-10.7

 

 

 

 

EX-10.8

DIRECTOR’S AGREEMENT

This Director’s Agreement (this “Agreement”) is made and entered into as of the 3rd day of November, 2020 (the “Effective Date”), by and between Brian Adair (hereinafter referred to as “Director”) and Santa Fe Gold Corporation, a Delaware corporation (“Company”).

WITNESSETH:

WHEREAS, Director serves as a chairman of the board of directors (“Board”) and desires to be paid for his continued efforts as chairman.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

1.Services of Chairman 

The chairman of the Board (“Director”) agrees to devote the amount of time, skill, and efforts during the term of this Agreement to the affairs of Company as may be reasonably requested and required of Director and in accordance with the duties and obligations imposed upon directors of corporations by the Company’s Certificate of Incorporation, Bylaws, Delaware corporate law, and federal and state securities law. As the Company lacks a chief executive officer, Director will assume certain responsibilities that would normally fall under the job description of the chief executive officer, including without limitation, negotiating a potential joint venture arrangement with respect to developing certain mining properties and formulating and implementing a financing plan with the goal to provide the Company with sufficient liquidity. This Agreement shall continue until June 30, 2021.

2.Compensation 

The Company shall pay Director the sum of $75,000 for the quarter ending June 30, 2020 and $300,000 for services rendered during the fiscal year ended June 30, 2021, paid through the issuance of restricted common shares, the number of shares to be issued monthly. The number of shares for issuance is determined monthly and based on the average share price of Company common stock for the month of measurement divided into $25,000. Shares to vest 1/12 per month during the current fiscal year (the first 4 months will have vested as of the effective date hereof, with the balance to vest pro-rata on the last day of each calendar month during this current fiscal year). The shares for the quarter ended June 30, 2020, have vested as of June 30, 2020. The Company shall reimburse Director for any out-of-pocket expenses incurred to attend Board of Director meetings or such other Company meetings or functions as the Company might request after submission of appropriate documentation.

3.Confidential and Proprietary Information; Documents 

3.1Director recognizes and acknowledges that Director will have access to certain information of Company that is confidential and proprietary and constitutes valuable and unique property of Company. Director agrees that Director will not at any time, either during or subsequent to the term of this Agreement, disclose to others, use, copy or permit to be copied, except in pursuance of Director’s duties on behalf of Company, its successors, assigns or nominees, or as required by the order of any tribunal having jurisdiction or by mandatory provisions of applicable law, any confidential information or know-how of Company without the prior written consent of the Board of Company. Director further agrees to maintain in confidence any confidential information of third parties received as a result of Director’s relationship with Company. 

3.2Director further agrees to deliver to Company promptly after his resignation, removal or failure to be nominated or elected as a member of the Board, all materials correspondence, memoranda , notes, records, plans, or other documents and all copies thereof (all of which are hereafter referred to as the “Documents”), made, composed or received by Director, solely or jointly with others, and which are in Director’s possession, custody, or control at such date and which are related in any manner to the past, present, or anticipated business of Company. 

4.Conflicts of Interest 

4.1In keeping with Director’s fiduciary duties to Company, Director agrees that Director shall not, directly or indirectly, becomeinvolved in any conflict of interest, or upon discovery thereof, allow such a conflict to continue. Moreover, Director agrees that Director shall promptly disclose to the Board of Company any facts which might involve any reasonable possibility of a conflict of interest as Company is currently and in the future configured and practicing business. Director shall maintain the highest standards of conduct, and shall not do anything likely to injure the reputation or goodwill of Company, or embarrass or otherwise generate adverse publicity for or bring unwanted attention to Company. 

4.2It is agreed that any direct or indirect interest in, connection with, or benefit from any outside activities, particularly commercial activities, which interest might in any way adversely affect Company or any of its subsidiaries or affiliates, involves a possible conflict of interest. Circumstances in which a conflict of interest on the part of Director would or might arise, and which should be reported immediately by Director to an officer of Company, include, without limitation, the following: (a) ownership of a material interest in, acting in any capacity for, or accepting directly or indirectly any payments, services or loans from a supplier, contractor, subcontractor, customer or other entity with which Company does business; (b) misuse of information or facilities to which Director has access in a manner which will be detrimental to Company’ interest; (c) disclosure or other misuse of information of any kind obtained through the Director’s connection with Company; (d) acquiring or trading in, directly or indirectly, other properties or interests adjacent to the properties and by Company; (e) the appropriation to the Director or the diversion to others, directly or indirectly , of any opportunity in which it is known or could reasonably be anticipated that Company would be interested unless Company is precluded from or chooses not to pursue such opportunity; and (f) the ownership, directly or indirectly, of a material interest in an enterprise in direct competition with Company or acting as a director, officer, partner, consultant, Director or agent of any enterprise which is in direct competition with Company. 

5.Miscellaneous 

5.1This Agreement is made and entered into as of the Effective Date and the rights and obligations of the parties hereto shall be binding upon the heirs and legal representatives of the Director and the successors and assigns of Company. This Agreement may be assigned by Company (including assignment by operation of law to any successor to the business of Company by merger, consolidation or other business combination) without the consent of Director but is personal to the Director and no rights, duties, and obligations of Director hereunder may be assigned without the consent of Company or its assigns, which may be granted or withheld in its sole discretion. 

5.2No waiver or non-action with respect to any breach by the other party of any provision of this Agreement, nor the waiver or non-action with respect to any breach of the provisions of similar agreements with other Directors shall be construed to be a waiver of any succeeding breach of such provision, or as a waiver of the provision itself. 

5.3Should any portions hereof be held to be invalid or wholly or partially unenforceable, such holding shall not invalidate or void the remainder of this Agreement. The portions held to be invalid or unenforceable shall be revised and reduced in scope so as to be valid and enforceable, or, if such is not possible, then such portions shall be deemed to have been wholly excluded with the same force and effect as it if had never been included herein. 

5.4Director ‘s obligations with regards Section 3 of this Agreement to Company shall survive Director’s resignation, removal or failure to be nominated or elected as a member of the Board of Company. 

5.5This Agreement supersedes. replaces and merges any and all prior and contemporaneous understandings, representations, agreements and discussions relating to the same or similar subject matter as that of this Agreement between the Director and Company and constitutes the sole and entire agreement between the Director and Company with respect to the subject matter of this Agreement. 

Director’s Agreement
November 3, 2020
Page 3 of 4

5.6The laws of the State of Delaware, excluding any conflicts of law rule or principle that might otherwise refer to the substantive law of another jurisdiction, will govern the interpretation, validity and effect of this Agreement without regard to the place of execution or the place for performance thereof. 

5.7All notices and other communications required or permitted hereunder or necessary or convenient in connection herewith shall be in writing and shall be deemed to have given when mailed by registered mail or certified mail, return receipt requested, as follows: 

As to the Director, at the Director’s home address on file with the Company.

As to the Company:

Santa Fe Gold Corporation
Attn: Board of Directors
3544 Rio Grande Blvd.,
NW Albuquerque, NM 87107

or to such other addresses as either party may designate by notice to the other party hereto in the manner specified in this section.

5.8This Agreement may not be changed or terminated orally, and no change, termination or waiver of this Agreement or of any of the provisions herein contained shall be binding unless made in writing and signed by both parties, and in the case of Company, by an authorized officer of Company. Any change or changes, from time to time, in Director’s compensation shall not be deemed to be, a change, termination or waiver of this Agreement or of any of the provisions herein contained. 

IN WITNESS WHEREOF, the undersigned have hereby caused this Agreement to be effective as of the date first written above.

 

Director’s Agreement
November 3, 2020
Page 4 of 4

5.7All notices and other communications required or permitted hereunder or necessary or convenient in connection herewith shall be in writingand shall be deemed to have given when mailed by registered mail or certified mail, return receipt requested, as follows: 

As to the Director, at the Director ‘s home address on file with the Company.

As to the Company:

Santa Fe Gold Corporation

Attn: Board of Directors

3544 Rio Grande Blvd., NW

Albuquerque, NM 87107

or to such other addresses as either party may designate by notice to the other party hereto in the manner specified in this section.

5.8This Agreement may not be changed or terminated orally, and no change, termination or waiver of this Agreement or of any of the provisions herein contained shall be binding unless made in writing and signed by both parties, and in the case of Company, by an authorized officer of Company. Any change or changes, from time to time, in Director’s compensation shall not be deemed to be, a change, termination or waiver of this Agreement or of any of the provisions herein contained. 

IN WITNESS WHEREOF, the undersigned have hereby caused this Agreement to be effective as of the date first written above.

 

EX-10.9

CONSULTING AGREEMENT

This consulting agreement (this “Agreement”) is entered into effective as of July 7, 2020 (the “Effective Date”), by and among Santa Fe Gold Corp., a Delaware corporation (the “Company”), and Stephen Antol (“Consultant”).

WHEREAS, the Company wishes to retain Consultant and Consultant wishes to provide consulting services to the Company; and

WHEREAS, the Company and Consultant desire to enter into an agreement reflecting the terms of such arrangement, including the rights and obligations of each party hereto.

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties, and agreements contained herein, and for other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

1.Term. Subject to the provisions for earlier termination provided in Section 7 hereof, the term of this Agreement shall commence on the Effective Date and shall continue for one year, with automatic successive one-year renewals provided that neither party has provided notice of termination prior to 30 days from the end of such applicable term (the “Term”). 

2.Consultant's Duties. During the Term, Consultant shall serve as chief financial officer of the Company, reporting to the Board of Directors. 

3.Compensation. 

(a)For services rendered by Consultant under this Agreement, the Company shall pay to Consultant a monthly fee of $12,500, payable bi-weekly (the “Monthly Compensation”). In the event that the health of Consultant deteriorates to a point where he is unable to perform his duties, Consultant will have the right to provide notice of his health deterioration as well as his termination of this Agreement as a result of his health deterioration and the Company will be obligated to pay Mr. Antol his Monthly Compensation for a period equal to the lesser of (i) six months and (ii) the balance of the applicable Term. 

(b)The Company and the Consultant each acknowledge and agree that the only relationship of the Consultant to the Company created by this Agreement will for all purposes be that of an independent contractor. The Company will have no obligation whatsoever to pay or compensate the Consultant for taxes of any kind whatsoever that arise out of or with respect to any fee, remuneration or compensation provided to the Consultant under this Agreement. The Consultant is not and will not be considered an employee of the Company and as a result, the Company will not provide benefits to the Consultant based on work performed under this Agreement including but not limited to benefits relating to: (i) sickness or accident, whether or not resulting from the performance by the Consultant of its obligations under this Agreement; (ii) retirement or pension benefits; or (iii) any other benefits provided by the Company or any of the affiliated companies to any of their employees. Consultant further acknowledges that the consideration agreed to herein is a gross amount of consideration and that the Company will not withhold from such consideration any amounts as income taxes' social security payments or any other payroll taxes. All such income taxes and other such payments shall be made or provided for by the Consultant and the Consultant will comply with all applicable federal, state, local, and foreign laws governing self-employed individuals, including laws requiring the payment of taxes, such as income and employment taxes, and social security, disability, and other contributions; the Company shall have no responsibility or duties regarding such matters. The Consultant will fully indemnify and hold harmless the Company from and against all assessments, claims, liabilities, costs, expenses and damages that the Company may suffer or incur with respect to any such taxes incurred by Consultant in connection with compensation paid hereunder or the benefits as described above. 

4.Reimbursements. In addition to the compensation provided for in Section 3 herein, Consultant shall be entitled to the following: The Company shall reimburse Consultant for the reasonable and necessary business expenses incurred in the performance of his duties pursuant to this Agreement. It is understood that Consultant is authorized to incur reasonable business expenses for travel (business class airfare), lodging, meals and business entertainment. Any expense greater than $100 shall require a receipt for reimbursement, any one expense greater than $750 must be pre-approved in writing by the Company and aggregate expenses in excess of $2,500 in any month must be pre-approved in writing by the Company. 

5.Restrictive Covenants. Consultant, during the Term, may have access to and become familiar with confidential information, secrets and proprietary information concerning the business and affairs of the Company, its controlled subsidiaries and other controlled entities, including business strategies, financial information, and other confidential and/or proprietary information (collectively, “Confidential Information”). Confidential Information shall not include any information that is or becomes generally available to the public other than as a result of Consultant's improper or unauthorized disclosure of such information in violation of this Agreement. As to such Confidential Information, Consultant agrees during the Term and following the termination of this Agreement, he will not, directly or indirectly, without the prior written consent of the Company (1) disclose or permit the disclosure of any such Confidential Information, or (2) use, reproduce or distribute, or make or permit any use, reproduction or distribution of, directly or indirectly, any such Confidential Information, except to discharge any responsibilities pursuant to this Agreement. 

6.Indemnification. 

(a)Third Party Proceedings. The Company shall indemnify Consultant if Consultant is or was a party or is threatened to be made a party to any threatened, pending or completed third party action or proceeding, whether civil, criminal, administrativeor investigative by reason of the fact that during the Term Consultant is or was a consultant of the Company (or any subsidiary of the Company), by reason of any action or inaction on the part of Consultant while a consultant of the Company during the Term, against expenses (including attorneys' fees) judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably incurred by Consultant in connection with such action or proceeding, provided that such indemnity shall not apply to (i) any such expenses, judgments, fines or amounts paid in settlement caused by Consultant's fraud, gross negligence or willful misconduct or (ii) any claim by the Company against Consultant as to Consultant's breach of Consultant's obligations under this Agreement. 

(b)Proceedings by or in the Right of the Company. The Company shall indemnify Consultant if Consultant was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company (or any subsidiary of the Company) to procure a judgment in its favor by reason of the fact that Consultant is or was a consultant or agent of the Company (or any subsidiary of the Company), or by reason of the fact that Consultant is or was serving at the request of the Company as a consultant or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Consultant in connection with the defense or settlement of such action or proceeding provided that such indemnity shall not apply to (i) any such action, proceeding or settlement caused by Consultant's fraud, gross negligence or willful misconduct or (ii) any claim by the Company against Consultant as to Consultant's breach of Consultant's obligations under this Agreement. 

(c)Advancement of Expenses. The Company shall advance all expenses incurred by Consultant in connection with the investigation, defense, settlement, or appeal of any civil or criminal action or proceeding referenced in Section 6(a) or (b) hereof. The advances to be made hereunder shall be paid by the Company to Consultant within twenty (20) days following delivery of a written request therefor by Consultant to the Company. 

(d)Notice/Cooperation by Consultant. Consultant shall, as a condition precedent to its right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Consultant for which indemnification will or could be sought under this Agreement, provided, however, that a delay in giving such notice shall not deprive Consultant of any right to be indemnified under this Agreement unless, and then only to the extent that, such delay is materially prejudicial to the defense of such claim. Notice to the Company shall be directed to the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Consultant, in accordance with Section 10 hereof). In addition, Consultant shall give the Company such information and cooperation as it may reasonably require and as shall be within Consultant's power. 

(e)Procedure. Any indemnification provided for in Section 6(a) or (b) shall be made no later than forty-five (45) days after receipt of the written request of Consultant. If a claim under this Agreement is not paid in full by the Company within forty-five (45) days after a written request for payment thereof has first been received by the Company, Consultant may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and Consultant shall also be entitled to be paid for the expenses (including attorneys' fees) of bringing such action. 

(f)Selection of Counsel. In the event the Company shall be obligated under Section 6(c) hereof to pay the expenses of any proceeding against Consultant, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Consultant, which approval shall not be unreasonably withheld (it being understood and agreed that the fact that such counsel is representing the Company in such proceeding shall not be grounds for withholding approval except pursuant to clause (ii)(B) below), upon the delivery to Consultant of written notice of its election so to do. After delivery of such notice, the Company will not be liable to Consultant under this Agreement for any fees of counsel subsequently incurred by Consultant with respect to the same proceeding, provided that (i) Consultant shall have the right employ its counsel in any such proceeding at Consultant's expense, and (ii) if (A) the employment of counsel by Consultant has been previously authorized by the Company, which authorization has not been revoked, (B) Consultant shall have reasonably concluded that there may be a conflict of interest between the Company and Consultant in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then, in the case of (A), (B), or (C) above, the fees and expenses of Consultant's counsel shall be at the expense of the Company. 

7.Termination. The Term may be terminated as set forth below: 

(a)By Consultant. Consultant may cease providing services to the Company at any time by providing thirty (30) days written notice to the Company in accordance with Section 10 hereof. In the event of such termination, this Agreement shall terminate on the Date of Termination and Consultant shall not be entitled to further compensation pursuant to Section 3 of this Agreement other than payment for (i) any unpaid Monthly Compensation through the Date of Termination, and(ii) any unpaid expenses incurred prior to the Date of Termination, subject to the Company's expense reimbursement rules and policies as in effect from time to time (the “Accrued Amounts”). Accrued Amounts, if any, shall be paid, and confirmed with respect to the Option via email to the email address on the signature page hereof, to Consultant in no event later than fifteen (15) days following the Date of Termination. 

(b)Reserved. 

(c)By Company. The Company may terminate: 

(i)in the event of Consultant's Misconduct upon written notice thereof delivered to Consultant in accordance with Section 7(e) and Section 10 hereof, in which case the Company shall have no further compensation obligations pursuant to Section 3 of this Agreement other than for payment to Consultant of the Accrued Amounts, if any, to be paid to the Consultant within fifteen (15) days of the Date of Termination or as otherwise provided for herein; or 

(ii)at any time for any reason other than for Misconduct upon10 days' written notice to Consultant, in which case the Company shall pay Consultant the balance of the Monthly Compensation through the Term, and Accrued Amounts, if any, all to be paid to Consultant all within fifteen (15) days of the Date of Termination. 

As used herein, “Misconduct” means a material breach of any of Consultant's obligations under this Agreement without Company's express written consent (including a breach of Section 5), Consultant's willful misconduct or gross negligence in performing his duties under this Agreement, or conviction of (including a plea of guilty or nolo contendere) a felony or crime involving moral turpitude; provided, that the Company has provided a Notice of Termination to Consultant of Company's intention to terminate the Agreement for Misconduct, and Consultant has failed to cure, to the extent curable, such circumstance within fifteen (15) days of receipt of the Notice of Termination given in respect thereof.

(d)Reserved. 

(e)Notice of Termination. Any purported termination of the Term by the Company under Section 7(c) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 10 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which, if by the Company under Section 7(c), shall set forth in reasonable detail the reason for such termination of this Agreement. 

(f)Date of Termination. “Date of Termination” shall mean the date specified in the Notice of Termination, provided that the Date of Termination shall be at least thirty (30) days following the date the Notice of Termination is given; provided, however, that in the case of Consultant's termination for Misconduct, Date of Termination shall mean the close of business on the last day on which Consultant may cure any circumstance alleged by the Company to give rise to a Misconduct termination. 

8.Assignability. The obligations of Consultant hereunder are personal and may not be assigned or delegated by him or transferred in any manner whatsoever, nor are such obligations subject to involuntary alienation, assignment or transfer. The Company shall have the right to assign this Agreement and to delegate all rights, duties and obligations hereunder, either in whole or in part, to any parent, affiliate, successor or subsidiary organization or company of the Company, so long as the obligations of the Company under this Agreement remain the obligations of the Company. 

9.Governing Law; Arbitration. This Agreement and any claim related directly or indirectly to this Agreement shall be governed by and construed in accordance with the laws of the State of New Mexico (without regard to conflicts of law principles that would result in the application of any law other than the law of the State of New Mexico). If any dispute should arise between Consultant and Company under this Agreement, all claims, disputes, controversies, differences or other matters in question arising out of this Agreement shall be resolved by binding arbitration in Albuquerque, New Mexico, in accordance with the rules for expedited, documents only proceedings of the American Arbitration Association. 

10.Notice. Unless otherwise provided herein, for the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given upon satisfaction of both (i) and (ii) set forth below: (i) via email to the email address on the signature page hereof and (ii) via mail when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the Company at its principal office address, directed to the attention of the Board with a copy to the Secretary of the Company, and to Consultant at Consultant's residence address on the records of the Company or to such other address as any party may have furnished to the other in writing in accordance herewith except that notice of change of address shall be effective only upon receipt. 

11.Validity. Company acknowledges that this Agreement is a binding and valid obligation of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 

12.Successors; Binding Agreement. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company other than in connection with a Corporate Change to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used herein, the term “Company” shall include any successor to its business and/or assets as aforesaid which executes and delivers the Agreement provided for in this Section 12 or which otherwise becomes bound by all terms and provisions of this Agreement by operation of law. 

13.Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Consultant and Company. No waiver by any party hereto at any time of any breach by another party hereto of, or in compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. This Agreement is an integration of the parties' agreement; no agreement or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party, except those which are set forth expressly in this Agreement. This Agreement replaces in its entirety all prior existing consulting agreements and arrangements by and between Consultant and the Company. 

14.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. 

[Signature Page Follows]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth above.

 

EX-10.10

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this “Agreement”) is entered into effective as of July 7, 2020 (the “Effective Date”), by and among Santa Fe Gold Corp., a Delaware corporation (the “Company”), and Frank Mueller (“Employee”).

WHEREAS, the Company wishes to employ Employee and Employee wishes to be employed by the Company; and

WHEREAS, the Company and Employee desire to enter into an agreement reflecting the terms of such employment, including the rights and obligations of each party hereto.

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties, and agreements contained herein, and for other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

1.Term of Employment. Subject to the provisions for earlier termination provided in Section 7 hereof, the term of this Agreement shall commence on the Effective Date and shall continue for one year, with automatic successive one-year renewals provided that neither party has provided notice of termination prior to 30 days from the end of such applicable term (the “Term”). Upon execution of this Agreement, Employee shall resign as chief financial officer and as director without any further action required by either the Company or Employee. 

2.Employee’s Duties. During the Term, Employee shall be responsible for managing the mining operations, reporting to the Chief Executive Officer of the Company or theBoard of Directors. Specifically, Employee shall have no involvement in (i) any of the accounting or financial reporting responsibilities of the Company, including without limitation, the ability to generate financial transactions into the financial records, and (ii) negotiating contracts with any third party on behalf of the Company (except as specifically delegated by the board of directors, with oversight by the Company’s CEO, and within the parameters established by the board of directors, in each instance, pursuant to resolution duly adopted), sending invoices to any customers or third parties and collecting amounts owed to the Company, and participating in any bid proposals on behalf of the Company (again except as delegated by the Company’s board of directors and under the supervision of the Company’s CEO, pursuant to duly authorized resolution.) 

3.Compensation. 

(a)Base Salary. For services rendered by Employee under this Agreement, the Company shall pay to Employee a monthly base salary of $12,500 per month, subject to applicable withholding taxes, payable in accordance with the Company’s customary payroll practices as in effect from time to time (the “Monthly Compensation”). 

(b)Severance. In the event that the health of Employee deteriorates to a point where he is unable to perform his duties, Employee will have the right to provide notice of his health deterioration as well as his resignation as a result of his health deterioration and the Company will be obligated to pay Mr. Mueller his base salary for a period equal to the lesser of (i) six months and (ii) the balance of the applicable Term. 

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4.Additional Benefits. In addition to the compensation provided for in Section 3 herein, Employee shall be entitled to the following: 

(a)Expenses. The Company shall reimburse Employee for the reasonable and necessary business expenses incurred in the performance of his duties pursuant to this Agreement. It is understood that Employee is authorized to incur reasonable business expenses for travel (business class airfare), lodging, meals and business entertainment. Any expense greater than $100 shall require a receipt for reimbursement, any one expense greater than $750 must be pre-approved in writing by the Company and aggregate expenses in excess of $2,500 in any month must be pre-approved in writing by the Company. Additionally, Employee shall be entitled to standard health care benefits to be provided by the Company consistent with past practice of the Company. 

5.Restrictive Covenants. Employee, during the Term, may have access to and become familiar with confidential information, secrets and proprietary information concerning the business and affairs of the Company, its controlled subsidiaries and other controlled entities, including business strategies, financial information, and other confidential and/or proprietary information (collectively, “Confidential Information”). Confidential Information shall not include any information that is or becomes generally available to the public other than as a result of Employee’s improper or unauthorized disclosure of such information in violation of this Agreement. As to such Confidential Information, Employee agrees during the Term and following the termination of this Agreement, he will not, directly or indirectly, without the prior written consent of the Company (1) disclose or permit the disclosure of any such Confidential Information, or (2) use, reproduce or distribute, or make or permit any use, reproduction or distribution of, directly or indirectly, any such Confidential Information, except for any disclosure, use, reproduction or distribution that is required in the course of the Employee’s employment with the Company. 

6.Indemnification. 

(a)Third Party Proceedings. The Company shall indemnify Employee if Employee is or was a party or is threatened to be made a party to any threatened, pending or completed third party action or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that during the Term Employee is or was an employee of the Company (or any subsidiary of the Company), by reason of any action or inaction on the part of Employee while an employee of the Company during the Term, against expenses (including attorneys’ fees) judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably incurred by Employee in connection with such action or proceeding, provided that such indemnity shall not apply to (i) any such expenses, judgments, fines or amounts paid in settlement caused by Employee’s fraud, gross negligence or willful misconduct or (ii) any claim by the Company against Employee as to Employee’s breach of Employee’s obligations under this Agreement.  

(b)Proceedings by or in the Right of the Company. The Company shall indemnify Employee if Employee was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company (or any subsidiary of the Company) to procure a judgment in its favor by reason of the fact that Employee is or was an employee or agent of the Company (or any subsidiary of the Company), or by reason of the fact that Employee is or was serving at the request of the Company as an employee, consultant or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Employee in connection with the defense or settlement of such action or proceeding provided that such  

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indemnity shall not apply to (i) any such action, proceeding or settlement caused by Employee’s fraud, gross negligence or willful misconduct or (ii) any claim by the Company against Employee as to Employee’s breach of Employee’s obligations under this Agreement.

(c)Advancement of Expenses. The Company shall advance all expenses incurred by Employee in connection with the investigation, defense, settlement, or appeal of any civil or criminal action or proceeding referenced in Section 6(a) or (b) hereof. The advances to be made hereunder shall be paid by the Company to Employee within twenty (20) days following delivery of a written request therefor by Employee to the Company. 

(d)Notice/Cooperation by Employee. Employee shall, as a condition precedent to its right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Employee for which indemnification will or could be sought under this Agreement, provided, however, that a delay in giving such notice shall not deprive Employee of any right to be indemnified under this Agreement unless, and then only to the extent that, such delay is materially prejudicial to the defense of such claim. Notice to the Company shall be directed to the General Counsel of the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Employee, in accordance with Section 10 hereof). In addition, Employee shall give the Company such information and cooperation as it may reasonably require and as shall be within Employee’s power. 

(e)Procedure. Any indemnification provided for in Section 6(a) or (b) shall be made no later than forty-five (45) days after receipt of the written request of Employee. If a claim under this Agreement is not paid in full by the Company within forty-five (45) days after a written request for payment thereof has first been received by the Company, Employee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and Employee shall also be entitled to be paid for the expenses (including attorneys’ fees) of bringing such action. 

(f)Selection of Counsel. In the event the Company shall be obligated under Section 6(c) hereof to pay the expenses of any proceeding against Employee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Employee, which approval shall not be unreasonably withheld (it being understood and agreed that the fact that such counsel is representing the Company in such proceeding shall not be grounds for withholding approval except pursuant to clause (ii)(B) below), upon the delivery to Employee of written notice of its election so to do. After delivery of such notice, the Company will not be liable to Employee under this Agreement for any fees of counsel subsequently incurred by Employee with respect to the same proceeding, provided that (i) Employee shall have the right employ its counsel in any such proceeding at Employee’s expense, and (ii) if (A) the employment of counsel by Employee has been previously authorized by the Company, which authorization has not been revoked, (B) Employee shall have reasonably concluded that there may be a conflict of interest between the Company and Employee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then, in the case of (A), (B), or (C) above, the fees and expenses of Employee’s counsel shall be at the expense of the Company. 

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7.Termination. The Term may be terminated as set forth below: 

(a)By Employee. Employee may cease providing services to the Company at any time by providing thirty (30) days written notice to the Company in accordance with Section 10 hereof. In the event of such termination, this Agreement shall terminate on the Date of Termination and Employee shall not be entitled to further compensation pursuant to Section 3 of this Agreement other than payment for (i) any unpaid Monthly Compensation through the Date of Termination, and (ii) any unpaid expenses incurred prior to the Date of Termination, subject to the Company’s expense reimbursement rules and policies as in effect from time to time (the “Accrued Amounts”). Accrued Amounts, if any, shall be paid, and confirmed with respect to the Option via email to the email address on the signature page hereof, to Employee in no event later than fifteen (15) days following the Date of Termination. 

(b)Reserved. 

(c)By Company. The Company may terminate: 

(i)in the event of Employee’s Misconduct upon written notice thereof delivered to Employee in accordance with Section 7(e) and Section 10 hereof, in which case the Company shall have no further compensation obligations pursuant to Section 3 of this Agreement other than for payment to Employee of the Accrued Amounts, if any, to be paid to the Employee within fifteen (15) days of the Date of Termination or as otherwise provided for herein; 

(ii)at any time for any reason other than for Misconduct upon 10 days’ written notice to Employee, in which case the Company shall pay Employee the balance of the Monthly Compensation through the Term, and Accrued Amounts, if any, all to be paid to Employee all within fifteen (15) days of the Date of Termination; or 

(iii)subsequent to the closing of a Corporate Change, in which the employment of the Employee shall terminate for any reason by either party within 180 days of such Corporate Change closing, the Company shall have the compensation obligation set forth in Section 3(b) of this Agreement plus Accrued Amounts, if any, to be paid within 30 days of the date of Termination.  

As used herein, “Misconduct” means a material breach of any of Employee’s obligations under this Agreement without Company’s express written consent (including a breach of Section 5), Employee’s willful misconduct or gross negligence in performing his duties under this Agreement, or conviction of (including a plea of guilty or nolo contendere) a felony or crime involving moral turpitude; provided, that the Company has provided a Notice of Termination to Employee of Company’s intention to terminate the Agreement for Misconduct, and Employee has failed to cure, to the extent curable, such circumstance within fifteen (15) days of receipt of the Notice of Termination given in respect thereof.

(d)Reserved. 

(e)Notice of Termination. Any purported termination of the Term by the Company under Section 7(c) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 10 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which, if by the Company under Section 7(c), shall set forth in reasonable detail the reason for such termination of this Agreement. 

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(f)Date of Termination. “Date of Termination” shall mean the date specified in the Notice of Termination, provided that the Date of Termination shall be at least thirty (30) days following the date the Notice of Termination is given; provided, however, that in the case of Employee’s termination for Misconduct, Date of Termination shall mean the close of business on the last day on which Employee may cure any circumstance alleged by the Company to give rise to a Misconduct termination. 

8.Assignability. The obligations of Employee hereunder are personal and may not be assigned or delegated by him or transferred in any manner whatsoever, nor are such obligations subject to involuntary alienation, assignment or transfer. The Company shall have the right to assign this Agreement and to delegate all rights, duties and obligations hereunder, either in whole or in part, to any parent, affiliate, successor or subsidiary organization or company of the Company, so long as the obligations of the Company under this Agreement remain the obligations of the Company. 

9.Governing Law; Arbitration. This Agreement and any claim related directly or indirectly to this Agreement shall be governed by and construed in accordance with the laws of the State of New Mexico (without regard to conflicts of law principles that would result in the application of any law other than the law of the State of New Mexico). If any dispute should arise between Employee and Company under this Agreement, all claims, disputes, controversies, differences or other matters in question arising out of this Agreement shall be resolved by binding arbitration in Albuquerque, New Mexico, in accordance with the rules for expedited, documents only proceedings of the American Arbitration Association. 

10.Notice. Unless otherwise provided herein, for the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given upon satisfaction of both (i) and (ii) set forth below: (i) via email to the email address on the signature page hereof and (ii) via mail when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the Company at its principal office address, directed to the attention of the Board with a copy to the Secretary of the Company, and to Employee at Employee’s residence address on the records of the Company or to such other address as any party may have furnished to the other in writing in accordance herewith except that notice of change of address shall be effective only upon receipt. 

11.Validity. Company acknowledges that this Agreement is a binding and valid obligation of the Company. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 

12.Successors; Binding Agreement. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company other than in connection with a Corporate Change to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used herein, the term “Company” shall include any successor to its business and/or assets as aforesaid which executes and delivers the Agreement provided for in this Section 12 or which otherwise becomes bound by all terms and provisions of this Agreement by operation of law. 

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13.Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Employee and Company. No waiver by any party hereto at any time of any breach by another party hereto of, or in compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. This Agreement is an integration of the parties’ agreement; no agreement or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party, except those which are set forth expressly in this Agreement. This Agreement replaces in its entirety all prior existing employment agreements and employment arrangements by and between Employee and the Company. 

14.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. 

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth above.

 

EX-10.11

Exhibit 10.11

BULLARD’S PEAK CORPORATION

(A NEW MEXICO CORPORATION)

STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (the “Agreement”) is dated the 18^th day of August, 2017 by and among SANTA FE ACQUISITIONS, LCC, a New Mexico corporation (“Buyer”), and BULLARD’S PEAK CORPORATION, a New Mexico corporation (“BPC”), and BLACK HAWK CONSOLIDATED MINES COMPANY, a Colorado Corporation (“Seller”).  Buyer and Seller together referenced herein as (the “Parties”).

RECITALS

WHEREAS, Seller is the owner of one hundred percent (100%) of all the issued and outstanding capital stock (common and preferred) of BPC pursuant to the Stock Certificates attached hereto as Exhibit A (the “Stock”); and

WHEREAS, BPC owns the patented and unpatented mining claims set forth in Exhibit B, attached hereto (the “Property”); which claims Seller and BPC both believe (but are not warranting) are free and clear of any liens or encumbrances that have priority over BPC’s interest except for potential “over-staking” of some of the Property pursuant to Exhibit D, attached hereto.

WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase from Seller the Stock for $3,000,000 plus two percent of the net smelter returns (the “Purchase Price”).

NOW, THEREFORE, in consideration of the foregoing premises, the provisions and the respective agreements hereinafter set forth, the Parties hereto hereby agree as follows:

1.Recitals.  All the above Recitals are incorporated herein as if fully set forth herein. 

2.Purchase and Sale of Stock. 

2.1Agreement to Purchase and Sell.  Upon the terms and subject to the conditions set forth in this Agreement, and upon the representations and warranties made herein by each of the Parties to the other on the Closing Date (as such term is hereinafter defined) Buyer shall pay the Purchase Price to Seller and Seller shall deliver to Buyer the Stock (duly endorsed by Buyers), along with all other documents, books, and records required in Section 2.5 herein. 

2.2Purchase Price.  The Purchase Price for the Stock shall be Three Million and No/100 U.S. Dollars ($3,000,000) plus two (2) percent of the Net Smelter Returns (as defined below) (the “NSR”) into perpetuity.  Net Smelter Return is defined to mean the greater of (i) all monies Buyer (or any entity on behalf of Buyer) or any successor owners of the patented or unpatented mines listed in Exhibit B hereto receives for or from any and all ore removed from the Property from time to time; whether the ore is removed for exploration, mining operations or any other reason (the “Ore”), or (ii) the fair market value of removed Ore.  Such two (2) percent of NSR shall be paid by Buyer (or Buyer’s successors or assigns) to Seller within 10 days of Buyer receiving money for all Ore taken from the Property, and in any case, within 120 days of Ore being taken off the Property whether Buyer has received remuneration for the Ore by such 120 days or not.  The obligation to pay Seller the NSR shall be secured by a Mortgage and/or Security Agreement on the Mines pursuant to Section 2.7(B) below. 

Exhibit 10.11

2.3Earnest Money.  Buyer shall pay Seller, by wire transfer in collectible funds to an account of Seller’s choice, upon execution of this Agreement, the sum of One Hundred Thousand Dollars ($100,000) as non-refundable earned money to be applied to the Three Million Dollar $3,000,000) Purchase Price.  If Seller does not receive such wire transfer in collectible funds by 5:00 p.m. CST, August 21, 2017, then this Agreement shall be null and void.  If Buyer does not close on or before 2:00 p.m. CST on August 30, 2017, the $100,000 of Earned Money is retained by Seller as partial payment for damages for Buyer not timely closing.  If Buyer closes on or before 2:00 p.m. on August 30, 2017, then the $100,000 Earnest Money shall be applied to the Purchase Price. 

2.4Payment of Purchase Amount.  The Purchase Price shall be paid in collected funds to Seller via wire transfer to Seller’s designated account as follows: 

A.$1,400,000 in collected funds at Closing (in addition to the $100,000 Earnest Money); and 

B.$1,500,000 paid in three (3) monthly payments of $500,000 in cash in collected funds by wire transfer due on or before September 30, 2017, October 31, 2017, and November 30, 2017. 

C.The two (2) percent of NSR shall be paid as set forth above in paragraph 2.2. 

2.5Closing.  The closing of the transaction contemplated herein (the “Closing”) will take place at 2:00 p.m. Central Standard Time on August 30, 2017 at the offices of Kilbourn Merchant Corporation, Germantown, Wisconsin. 

2.6Transfer of Stock Ownership; Resignation of Officers and Directors; Other Documents/Records.  Upon receipt by Seller at Closing of the $1,500,000 U.S. Dollars of the Purchase Price in collectible funds (including the Earnest Money), and receipt from Buyer of the original executed Note, Mortgage and Pledge Agreement, Seller will immediately transfer to Buyer the following: 

A.Resignation of all current officers and directors of BPC. 

B.All books and records of BPC in Seller’s possession, including: 

i.BPC’s current corporate minute book, directors meetings minutes, resolutions, 

ii.BPC’s Articles of Incorporation, and all Annual Statements of Officers and Directors that BPC filed, 

iii.A Certificate of Good Standing from the New Mexico Secretary of State, 

iv.BPC’s corporate income tax returns for tax years 2010 through 2015, 

v.BPC’s current internally prepared financial statement (Balance Sheet and Profit & Loss Statement), 

vi.Copies of all Purchase Contracts, Abstracts of Title, Agreements, and patent filings on, or relating to, the patented claims that make up the Property which are in BPC’s possession.  

C.A resolution/minutes from Black Hawk Mining Corporation’s Board of Directors approving the same of BPC. 

D.A sworn certificate from Seller stating that all the books and records identified above are true and correct to Seller’s best knowledge and belief. 

Exhibit 10.11

2.7Buyer’s Closing Documents. 

A.At Closing, Buyer shall execute a Promissory Note in favor of Seller for the unpaid Purchase Price of $1,500,000 with the payment terms set forth in paragraph 2.4 above, a copy of which is attached hereto as Exhibit H (the “Note”).  There will be no interest charged on the unpaid principal balance owed on the Note, provided the same is timely paid.  If any payment is received by Seller more than three business days after the scheduled due date of the payment, Buyer will be liable to immediately pay Seller a late fee of five (5) percent of the late payment.  If any scheduled payment or late fee is more than twenty (20) days past due (“Default”), then the entire unpaid principal balance of the Note will automatically be accelerated and be immediately due and payable.  The Note shall have all other customary terms of default.  After Default the Note will accrue interest at twelve (12) percent per annum.  The Note may be prepaid in part or in full with no penalty.  If Buyer prepays the Note by August 31, 2017, then the Note may be satisfied by the payment of $1,400,000. 

B.The Note and the two (2) percent of the NSR shall be secured by (i) a first lien on all real estate owed by BPC pursuant to a deed in trust/mortgage, a copy of which is attached hereto as Exhibit I and (ii) a stock collateral pledge agreement, a copy of which is attached hereto as Exhibit J (“Pledge Agreement”) pursuant to which Buyer pledges to Seller as collateral all the stock of BPC sold hereunder.  Pursuant to the Pledge Agreement, Seller will retain possession of the original stock certificate(s) representing all the shares of stock of BPC until Buyer pays all amounts owed under the Note except for the two (2) percent of the NSR.  If Buyer defaults in payment under the Note, Seller shall have the right under the Pledge Agreement to take immediate possession and ownership of the pledged Stock and all Buyer’s rights to the Stock shall immediately terminate and all Purchase Price paid by Buyer shall be forfeited to Seller, and Buyer shall have no legal or equitable rights to any of the Purchase Price Buyer paid Seller, nor (iii) any ownership interest in Black Hawk or BPC Stock, and (iv) the Stock Purchase Agreement will immediately terminate and Buyer shall have no further legal or equitable claims against Seller whatsoever.  The Mortgage shall remain on the Property in perpetuity to secure the two (2) percent of the NSR obligation of Buyer. 

2.8Buyer’s Restrictions. 

A.Buyer may not engage in any mining activities (exclusive of geographical mapping and sample drilling to prove viability of the mines) until the Note is paid in full.  As such, Buyer shall not remove any ore/materials/dirt, etc. from the ground that has a fair market value exceeding $10,000 cumulative total during the term of the Note until the Note is paid in full.  Breach of this Agreement is an event of default of the Note and Collateral Pledge Agreement. 

B.Until the entire Purchase Price is paid in full, Seller (or any assignee/agent/ designated party of Seller) shall have the right (without notice to Buyer) to come upon all real estate currently owned by BPC, including the unpatented mine claims of BPC, to inspect and observe the condition of the same and verify that the Buyer is in compliance with the Stock Purchase Agreement, the Note, and the Collateral Pledge Agreement.  This includes the right of Seller to place a camper trailer on any real estate currently owned by BPC (and stay in the camper) until the Note is paid in full. 

2.9Ownership of Unpatented Mining Claims.  Since Buyer is paying for the Stock over time, title to, and ownership of, all unpatented mining claims of BPC (as set forth in Exhibit B to the Stock Purchase Agreement) the (“Unpatented Claims”) will be transferred before Closing to Seller, and Seller will retain ownership of the Unpatented Claims, until the Note is timely paid in full; and upon such event, Seller will immediately transfer ownership of the Unpatented Claims to Buyer (with such Unpatented Claims subject to all then existing over-stacking claims and any encumbrances that currently exist on the Unpatented Claims).  Seller will timely pay/file all BLM fees/notices and County Notice of  

Exhibit 10.11

Intent fees/notices on the Unpatented Claims until Buyer timely pays the Note in full and Seller transfers the Unpatented Claims to Buyer.  Upon timely payment of the Note in full, Trevor Harder will transfer without any warranties/representations to Buyer all his interest (if any) in the Unpatented Claims by Quit Claim Deed.

3.Representations and Warranties of the Seller.  Seller represents and warrants to Buyer as follows: 

3.1Existence and Good Standing.  To the best of Seller’s knowledge, BPC is a corporation duly registered, validly existing, and in good standing under the laws of the State of New Mexico and BPC is duly registered and qualified to do business in the State of New Mexico. 

3.2Corporate Authority.  To the best of Seller’s knowledge, Seller and BPC have all requisite corporate powers and authority to own its properties and carry on its business as now conducted. 

3.3Compliance with Law.  To the best of Seller’s knowledge, BPC is not in default with respect to any order of any court, governmental authority or arbitration board or tribunal to which BPC is a Party, or is subject, and BPC is not in known violation of any laws, ordinances, governmental rules, or regulations to which they are subject.  To the best of Seller’s knowledge, BPC has obtained all licenses, paid all applicable taxes, obtained all permits and other authorizations, and has taken all actions required by applicable laws or governmental regulations in connection with its business, as now conducted.  Seller has received no notice of a claim of non-compliance with any legal requirements relating to the Property.  To the best of Seller’s knowledge (i) no governmental authority or any employee or agent thereof has made any claim to Seller that it considers the Property to be in violation of any legal requirements, and (ii) no investigation has been commenced or is contemplated respecting any possible violation. 

3.4Validity and Effect of Agreements.  This Agreement, along with all agreements and documents attached or contemplated hereby when executed and delivered pursuant hereto, will constitute the valid and legally binding obligations of Seller, enforceable in accordance with their terms, except that enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium, or other similar laws of general application. 

3.5Acknowledgment Regarding Buyer’s Purchase of Stock.  Seller acknowledges and agrees that Buyer is acting in the capacity of arm’s length purchaser with respect to the Agreement and the transactions contemplated hereby and that Buyer is (i) not an officer or director of BPC, and (ii) not an “affiliate” of BPC, or any of its subsidiaries.  BPC further acknowledges that Buyer is not acting as a financial advisor or fiduciary of BPC, or any of its subsidiaries (or in any similar capacity) with respect to the Agreement and the Transactions contemplated hereby. 

3.6Undisclosed Liabilities.  To the best of Seller’s knowledge, BPC has no liabilities or obligations whatsoever, whether accrued, absolute, contingent or otherwise as of Closing, except as follows: (i) Unbilled attorney/accounting fees and (ii) operating expenses less than $10,000 (the “Liabilities”).  Seller will remove all money in BPC’s financial accounts as of Closing and pay all Liabilities, and Seller will transfer any excess funds of BPC to Seller, so that BPC’s financial accounts are at zero as of Closing.  Seller will close all BPC’s financial accounts at Closing. 

3.7Taxes.  To Seller’s best knowledge, BPC has (i) duly filed or caused to be filed all federal, state, local and foreign tax returns (including, without limitation, consolidated and/or combined tax returns) that it knows are required to be filed by it prior to the date of this Agreement which relate to BPC, or with respect to which BPC, or the assets or properties of BPC, are liable or otherwise in  

Exhibit 10.11

any way subject, (ii) paid or fully accrued for all taxes shown to be due and payable on such returns (which taxes are all the taxes due and payable under the laws and regulations pursuant to which such returns were filed), and (iii) properly accounted for all such taxes accrued with respect to BPC, or the assets and properties of BPC for periods subsequent to the periods covered by such returns.  To Seller’s best knowledge, no deficiency in payment of taxes for any period has been asserted by any taxing body which remains unsettled or in question at the date of this Agreement.  Copies of all federal, state, local and foreign tax returns of BPC have been made available for inspection by Buyer.  To Seller’s best knowledge, BPC has paid the Maintenance Fees due Bureau of Land Management on the Property due by August 31, 2017 for time period of September 1, 2017 to August 31, 2018.

3.8Title to BPC Shares.  To the Seller’s best knowledge, the Stock is duly authorized, validly issued, fully paid and non-assessable and is owned by Seller free and clear of all liens, encumbrances, charges, assessments and adverse claims.  To the Seller’s best knowledge, the Stocks are subject to no restrictions with respect to transferability to Buyer in accordance with the terms of this Agreement and upon payment of the Purchase Price to Seller by Buyer, and the subsequent transfer of the Stock by Seller to Buyer, Buyer will, as a result, receive good and marketable title to all of the Stock, free and clear of all security interest, liens, encumbrances, charges, assessments, restrictions and adverse claims created by Seller (but not created by or through Buyer after Buyer receives the Stock). 

3.9Title to Property and Assets.  BPC is not warranting to Buyer in any way the condition of the title it has to the Property.  Buyer is making its own assessment as to the condition of the title of the Property.  Buyer understands BPC received title to the Property in various ways; (quit claim deeds, warranty deeds, special warranty deeds, etc.) and has done its own research and analysis of the condition of title BPC has to the Property and accepts the title in its present condition.  To BPC’s best knowledge, no person or entity has made any claim to the Property, except for the claims attached hereto as Exhibit G.  However, neither Seller nor BPC has fully researched and/or checked title to the Property at the Grant County records, or the BLM records (or anywhere else), and therefore, is making no warranties or representations as to the condition of title of the Property.  To Seller’s and BPC’s knowledge, none of the Property is subject to, or will be subject to as of Closing, a contract of sale, transfer, or conveyance.  To Seller’s and BPC’s knowledge, the Property is not subject to, and will not be subject to as of Closing, any security interests, mortgages, encumbrances, liens, or charges of any kind or character, except as set forth on Exhibit G and except for the obligation to pay BLM Maintenance Fees and county requirements to file Mining Claim Intent to Hold. 

3.10Business Property Rights.  No person or corporation has made or, to the knowledge of Seller, threatened to make any claims that the operation of the business of BPC is in violation of, or infringes on, any business property rights, or any other proprietary or trade rights of any third party.  To the knowledge of BPC, no third party is in violation of, or is infringing upon, any business property rights of BPC. 

3.11Litigation.  To Seller’s best knowledge, there are no actions, suits or proceedings which are pending at law or in equity, before any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, against Seller or BPC.  To Seller’s best knowledge, there are no orders, judgments, injunctions or decrees of any court or governmental agency with respect to which Seller or BPC have been named, or to which Seller or BPC is a party, which would result in any material adverse change in the business or prospects of BPC and/or the Property. 

Exhibit 10.11

3.12Environmental Matters.  To Seller’s best knowledge, there is no notice, notification, demand, request for information, citation, summons, complaint, or court order that has been received, and no known complaint filed, no penalty, no current investigation or known intent to investigate exists with regard to the claims and properties that are the subject of this Agreement.  To Seller’s best knowledge, no governmental or regulatory body of any kind has alleged any violation of any environmental law by BPC and no issue has been raised with regard to the absence of any relevant environmental permit, certificate, license, approval, registration or authorization required by any environmental law. 

3.13Compliance with Applicable Laws.  To Seller’s best knowledge, BPC has conducted its business in full compliance with all applicable laws, including – without limitation – all insurance laws, ordinances, rules, regulations, decrees and orders of any governmental authority. 

3.14Affiliate Transactions.  There are no current contracts or arrangements of any kind between BPC and any officer, director, or principal shareholder of BPC, or any of their respective affiliates. 

4.Representations and Warranties of Buyer.  Buyer represents and warrants to Seller and BPC as follows: 

4.1Existence and Good Standing.  Buyer is a stock corporation duly incorporated, validly existing, and in good standing under the laws of the State of New Mexico.  Buyer is duly licensed or qualified to do business as a corporation and is in good standing under the laws of all other jurisdictions in which the transaction of its business makes such qualification necessary. 

4.2Financial Capacity.  Buyer warrants and represents that it has the financial capacity to perform its obligations under this Agreement subject to receiving the appropriate funds from its third party financial commitments. 

4.3Corporate Authority.  Buyer has all requisite corporate power and authority to own its properties and carry on its business as now conducted. 

4.4Compliance with Law.  To Buyer’s knowledge, Buyer is not in default with respect to any order of any court, governmental authority, arbitration board or tribunal to which Buyer is a Party or to which it is subject, and Buyer is not in known violation of any laws, ordinances, governmental rules or regulations to which it is subject.  Buyer has obtained all licenses, permits or other authorizations and has taken all actions required by applicable laws or governmental regulations in connection with its business as now conducted.   

4.5Authorization, Validity and Effect of Agreements.  The execution and delivery of this Agreement and all agreements and documents contemplated hereby by Buyer, and the consummation by it of the transactions contemplated hereby, have been duly authorized by all requisite corporate action.  This Agreement, and all agreements and documents contemplated hereby when executed and delivered pursuant hereto, will constitute, the valid and legally binding obligations of Buyer enforceable in accordance with their terms, except that enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium, or other similar laws of general application now or hereafter in effect relating to the enforcement of creditors’ rights generally, except that the remedies to specific performance, injunction and other forms of equitable relief are subject to certain tests of equity jurisdiction, equitable defenses, and the discretion of the court before which any proceeding therefore may be brought. 

Exhibit 10.11

5.Seller’s Conditions of Closing.  The obligation of Seller to close hereunder shall be subject to and conditioned upon the prior occurrence or satisfaction (or waiver by Seller) at the Closing of each of the following conditions: 

5.1Buyer shall have first delivered to Seller the sum of One Million Five Hundred Thousand Dollars ($1,500,000) in collected funds representing partial payment of the Purchase Price prior to or on the time for Closing. 

5.2All representations and warranties of Buyer contained in this Agreement shall be true and correct at and as of the Closing Date and Buyer shall have performed all agreements and covenants, as well as satisfied all conditions on its part to be performed or satisfied by the Closing Date pursuant to the terms of this Agreement. 

5.3No suit, action, investigation, inquiry, or other proceeding by any governmental body or other person or legal or administrative proceeding shall have been instituted or threatened which questions the validity or legality of the transactions contemplated hereby. 

5.4As of the Closing Date, there shall be no effective injunction, writ, preliminary restraining order, or any order of any nature issued by a court of competent jurisdiction directing that the transactions provided for herein, or any of them, not be consummated as so provided, or imposing any conditions on the consummation of the transactions contemplated hereby. 

5.5As of the Closing, there shall have been no material adverse change in the amount of issued and outstanding common stock of BPC. 

5.6Buyer shall have executed and delivered to Seller all documents required in Section 2.6 above consisting of the Note, Mortgage, and Pledge Agreement. 

5.7Upon the occurrence of 5.1 to 5.6 above, Seller will do the following: 

5.7.1Seller shall deliver to the Buyer the documents required from Seller in Section 2.6 above. 

6.Buyer’s Conditions of Closing.  The obligation of Buyer to close will be subject only to following: 

6.1All representations and warranties of Seller and BPC contained in this Agreement shall be true and correct now and as of the Closing Date.  Further, Seller and BPC shall have performed all agreements and covenants, and satisfied all conditions on their part to be performed or satisfied by the Closing Date pursuant to the terms of this Agreement. 

6.2As of the Closing Date, there shall have been no material adverse change to the Property owned by BPC prior to the date of the Closing Date of this Agreement from the execution date of this Agreement, and BPC shall not have suffered any material loss (whether or not insured) by reason of physical damage caused by fire, earthquake, accident, or other calamity which materially affects the value of its assets, properties, or business between the execution date of this Agreement and the Closing Date. 

6.3As of the Closing Date, no suit, action, investigation, inquiry, or other proceeding by any governmental body or other person or legal, or administrative proceeding shall have been instituted or threatened which questions the validity or legality of the transactions contemplated hereby. 

Exhibit 10.11

6.4As of the Closing Date, there shall be no effective injunction, writ, preliminary restraining order, or any order of any nature issued by a court of competent jurisdiction directing that the transactions provided for herein, or any of them, not be consummated as so provided, or imposing any conditions on the consummation of the transactions contemplated hereby. 

6.5As of the Closing Date, there shall have been no material adverse change in the amount of issued and outstanding common stock of the BPC from the execution date of this Agreement. 

7.Termination.  

7.1Methods of Termination.  The transactions contemplated herein may be terminated and/or abandoned at any time without liability of any party to the other (except Seller retains the $100,000 Earnest Money) only under the following conditions: 

7.1.1By mutual written agreement of Seller and Buyer; or 

7.1.2By Seller, if any of the conditions provided for in Section 5 hereof shall not have been timely met or waived in writing by Seller prior to Closing, or 

7.1.3By Buyer, if any of the conditions provided for in Section 6 hereof shall not have been timely met or waived in writing by Buyer prior to Closing, or 

7.2Procedure Upon Termination.  In the event of termination by Buyer or Seller, as applicable, pursuant to this Section 7 hereof, written notice thereof shall forthwith be given to the other party.  Time is of the essence as to all conditions of Closing.  Should such Condition of Closing not be timely met then all transactions contemplated by this Agreement shall be automatically terminated without further action by Buyer or Seller.  If the transactions contemplated by this Agreement are so terminated, each Party will return all documents, work papers, and other material of any other Party relating to the transactions contemplated hereby, whether so obtained before or after the execution of this Agreement, to the Party furnishing the same, and Seller will retain the $100,000 non-refundable Earnest Money. 

8.Miscellaneous.  

8.1Notice.  Any notices required or permitted hereunder shall be in writing and shall be sufficiently given if (i) personally delivered, or (ii) mailed to the other Party by United States mail, certified or registered mail, return receipt requested, or (iii) by email delivery, or (iv) by facsimile delivery, all to the addresses set forth below: 

Seller:   Black Hawk Consolidated Mines Company c/o Trevor Harder Box 23 Colgate, WI 53017 Tel: 262-255-4298 Fax: 262-255-7469 Email: Kilbourn@milwpc.com   Buyer:   Santa Fe Acquisitions, LLC c/o Ashley Montenegro 909 N. Hudson Street Silver City, NM 80061 Phone: 575-388-1951 Email: Ashley@laws-co.com  

Exhibit 10.11

With a copy to:

Attorney David J. Winkel

Winkel Law Office

411 S. Commercial Street

Neenah, WI 54956

Tel: Tel: 920-725-8887

Fax: 920-725-9077

Email: dave@winkellaw.com

8.2Execution of Additional Documents.  The Parties hereto will at any time and from time to time after the Closing Date, upon reasonable request of the other Party, execute, acknowledge and deliver all such further acts as may be reasonably required to carry out the intent of this Agreement, and to transfer and vest title to any Stock being transferred hereunder; provided, however, that this Agreement shall be effective regardless of whether any such additional documents are executed. 

8.3Binding Effect; Benefits.  This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective, successors and assigns.  Notwithstanding anything contained in this Agreement to the contrary, nothing in this Agreement, expressed or implied, is intended to confer on any person other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.  There are no third party beneficiaries to this Agreement. 

8.4Entire Agreement.  This Agreement, together with the Exhibits, constitute the final written expression of all of the agreements between the Parties, and is a complete and exclusive statement of those terms.  It supersedes all understandings and negotiations concerning the matters specified herein.  Any representations, promises, warranties or statements made by either Party that differ in any way from the terms of this written Agreement and other documents contemplated hereby, shall be given no force or effect.  The Parties specifically represent, each to the other, that there are no additional or supplemental agreements between them related in any way to the matters herein contained, unless specifically included or referred to herein.  No addition to, or modification of any provisions of this Agreement, shall be binding upon any Party unless made in writing and signed by all Parties. 

8.5Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Wisconsin, exclusive of the conflict of law provisions thereof.  Venue will be in the Circuit Court for Waukesha County, Wisconsin. 

8.6Survival.  All of the terms, conditions, warranties and representations contained in this Agreement shall survive the Closing. 

8.7Counterparts.  This Agreement may be executed in any number of counterparts by email signature, facsimile signature, and when put together shall be deemed an original Agreement. 

8.8Headings.  Headings of the Articles and Sections of this Agreement are for the convenience of the Parties only, and shall be given no substantive or interpretive effect whatsoever. 

Exhibit 10.11

8.9Waivers.  No action taken pursuant to this Agreement, including without limitation any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representations, warranties, covenants or agreements contained in this Agreement.  The written waiver by any Party hereto of a breach of any provision hereunder by the other Party shall not operate or be construed as a waiver of any prior or subsequent breach of the same or any other provision hereunder by the other Party. 

8.10Merger of Documents.  This Agreement, and all attachments and documents contemplated hereby, constitute one agreement and are interdependent upon each other in all respects. 

8.11Incorporation of Exhibits and Schedules.  All exhibits and documents attached hereto are by this reference incorporated herein and made a part hereof for all purposes, as if fully set forth at length herein. 

8.12Severability.  If for any reason whatsoever, any one or more of the provisions of this Agreement shall be held or deemed to be inoperative, unenforceable, or invalid as applied to any particular case or in all cases, such circumstances shall not have the effect of rendering such provision invalid in any other case or of rendering any of the other provisions of this Agreement inoperative, unenforceable or invalid. 

8.13Assignability.  Neither this Agreement, nor any of the Parties’ rights hereunder, shall be assignable by any Party hereto without the prior written consent of the other Parties hereto. 

IN WITNESS WHEREOF, the Parties have executed this Agreement and caused the same to be duly delivered on their behalf on the day and year first above written.

SELLER:BLACK HAWK CONSOLIDATED   MINES COMPANY		BULLARD’S PEAK CORPORATION
By:	/s/Trevor Harder	By:	/s/Trevor Harder
	Trevor Harder, President		Trevor Harder, President
BUYER:  SANTA FE ACQUISITIONS, LLC
By:	/s/Thomas H. Laws
	Name:Thomas H. Laws
	Title:CEO

EX-10.12

 

 

 

 

 

 

 

 

 

 

EX-10.13

AMENDMENT NO. 2 TO STOCK PURCHASE AGREEMENT

This Agreement amends the Stock Purchase Agreement dated August 18, 2017 (the “Agreement”), by and between Santa Fe Acquisitions, LLC (“Buyer”), Bullard’s Peak Corporation (“BPC”), and Black Hawk Consolidated Mines Company (“Seller”).

RECITALS

WHEREAS, the Agreement required that $1,500,000 of the $3,000,000 Purchase Price be paid Seller by Buyer no later than August 30, 2017 (the “Closing Date”); and

WHEREAS, Buyer failed to pay such $1,500,000 of the Purchase Price by the Closing Date of August 30, 2017, but did pay some more of the Purchase Price after August 30, 2017, and requested Seller enter into an Amendment to the Agreement extending the time for payment of the Purchase Price until January 31, 2018, with the unpaid Purchase Price accruing interest at 12 percent per annum per the Agreement; and

WHEREAS, the parties entered into Amendment No. 1 to Stock Purchase Agreement, a copy of which is attached hereto and incorporated herein as Exhibit A; and

WHEREAS, Buyer failed to pay $500,000 of the Purchase Price by January 31, 2018; and WHEREAS, on August 16, 2018, since Buyer still had not paid the remaining $500,000 of Purchase Price, Seller elected to hold Buyer in default of the Agreement and elected to retain all of the Purchase Price paid to Seller as liquidated damages, and declare the Agreement null and void as to Buyer’s rights to purchase the Stock; copy of which election letter sent to Buyer is attached hereto and incorporated herein as Exhibit B; and

WHEREAS, Buyer desires Seller to reinstate the Agreement and withdraw the August 16, 2018 election to terminate letter of Exhibit B provided Buyer pays Seller $100,000 before 5:00 p.m. central standard time on October 17, 2018 as set forth in Section 1 below.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1.If, and only if, Buyer pays Seller $100,000 in collectible funds by wire transfer received by Seller by 5:00 p.m. central standard time on October 15, 2018, (a) the Agreement (as amended by Amendment No. 1 and by this Amendment No. 2) shall be reinstated, (b) Seller will be deemed to have rescinded the August 16, 2018 election to terminate the Agreement of Exhibit B attached hereto, (c) the $100,000 payment shall be applied (i) $32,500 to interest from December 1, 2017 to October 15, 2018, (ii) $12,865 to reimburse Seller for the BLM mining claims registrations for 2018 pursuant to Exhibit C; (iii) $5,000 to Seller’s attorney fees, and (iv) $49,635 to the Purchase Price, and (d) Seller will waive all events of default under the Agreement (as Amended) up to the date of this Amendment No. 2 and waives any additional interest, late fees, or other damage claims due to Buyer’s prior breaches of the Agreement  that have occurred up to execution of this Amendment No. 2. If Seller does not receive such $100,000 by wire transfer by 5:00 p.m. central standard time on October 15, 2018, then this Amendment No. 2 shall automatically become null and void and the August 16, 2018 termination letter is deemed to be in full force and effect and Buyer agrees it has no rights under the Agreement and agrees Seller may retain the $2,500,000 paid by Buyer to Seller, and Buyer releases Seller of any and all claims, causes of action, and the like arising from the beginning of time to the date hereof, and Buyer understands and agrees that Seller will have the right to sell the Stock of BPC to another buyer of Seller’s choice. 

2.After receiving the $100,000 payment of paragraph 1, the balance of the Purchase Price owed, which is $450,365, shall be paid as follows: (i) $100,000 on or before October 31, 2018, (ii) 

$100,000 on or before November 30, 2018, and (iii) $250,365 on or before December 31, 2018. If any payments is not paid in collectible funds by wire transfer to Seller received on or before 5:00 p.m. central standard time by Seller on the dates indicated; then all rights of the Buyer under the Agreement (as amended) shall become automatically null and void and Seller shall retain all monies paid Seller by Buyer as liquidated damages for Buyer’s breach, and Seller shall have no further obligations to Buyer, including but not limited to, any obligation to transfer the Stock to Buyer pursuant to the terms of the Agreement (as amended).

3.Buyer acknowledges Seller has not made any representations or warranties to induce Buyer to sign the Agreement, Amendment No. 1 and/or this Amendment No. 2. Buyer hereby releases, remises, discharges, indemnifies, and holds harmless Seller and BPC, (and their respective officers, directors, shareholders, agents, attorneys, accountants and assigns) from any and all liability, claims, lawsuits, investigations or causes of action regarding the Agreement (including Amendment No. 1 and Amendment No. 2), besides (i) the express obligations of Seller in Section 2.6 of the Agreement and (ii) the obligations of Seller to transfer the Stock, free and clear of liens and encumbrances, to Buyer if Buyer timely makes all payments hereunder, and signs the documents set forth in the Agreement at Closing. Buyer also releases, remises, discharges, indemnifies, and holds harmless any and all shareholders, directors, officers, agents, attorneys, accountants and assigns of Seller and/or BPC from any and all claims or causes of actions, known or unknown, contingent or liquidated, arising from the beginning of time to the date hereof regarding the Agreement, and acknowledges and agrees that it has only contracted with Seller under the Agreement and not with any individual. 

4.All capitalized words used herein shall have the same meaning as set forth in the Agreement. The name of Buyer was misspelled in the Agreement; the name is Santa Fe Aquisitions, LLC and this correction is reflected throughout the Agreement. 

5.Section 8.1 of the Agreement is modified so that all notices shall be addressed to Buyer at Santa Fe Acquisitions, LLC, c/o Attorney Thomas C. Pritchard, 800 Bering Drive, Suite 201, Houston, TX 77057, emailpritchard@bplaw.com, facsimile 832-538-1265. 

6.Buyer has orally stated to Seller that Thomas Laws, prior President of Buyer, is no longer the chief executive officer or president of Buyer. As such, Buyer represents and warrants to Seller that the person signing this Amendment No. 2 on behalf of Buyer has good and valid authority to bind Buyer to this Amendment No. 2. 

7.If Buyer timely pays all amounts due hereunder, then (i) Sections 2.7(A) of the Agreement will be deleted, and (ii) the Closing will take place on January 2, 2019 at 2:00 p.m. central standard time at the offices of Kilbourn Merchant Corporation, Germantown, Wisconsin pursuant to the remaining terms of the Agreement, with each party delivering to the other the documents and things required in the Agreement (as amended) without regard to the $1,500,000 Promissory Note referenced in Section 2.7 but with regard to the 2 percent NSR. 

8.Buyer acknowledges that prior to Closing, Bullard’s Peak will transfer all its rights in the Granada Claim BLM Number 188086 to Robert Rodgers (or his assigns) for past consideration. 

9.This Amendment may be executed in any number of counterparts by email signatures and/or facsimile signatures and when put together shall be deemed an original Agreement. This Amendment No. 2 to the Agreement (with Exhibits), the Agreement, and Amendment No. 1 to the Agreement, together constitute the entire Agreement between the Parties. 

Dated this day of October, 2018. 

SELLER: BLACK HAWK CONSOLIDATED MINES COMPANY		BULLARD’S PEAK CORPORATION
By:		By:
	Trevor Harder, President		Trevor Harder, President

BUYER: SANTA FE ACQUISITIONS, LLC

By:

Name:

Title:

EX-10.14

AMENDMENT NO. 3 TO STOCK PURCHASE AGREEMENT

This Agreement amends the Stock Purchase Agreement dated August 18, 2017 (the " Agreement"), by and between Santa Fe Acquisitions, LLC ("Buyer"), Bullard' s Peak Corporation (" BPC"), and Black Hawk Consolidated Mines Company ("Seller").

RECITALS

WHEREAS, the Agreement required that $1,500,000 of the $3,000,000 Purchase Price be paid Seller by Buyer no later than August 30, 2017 (the "Closing Date"); and

WHEREAS, Buyer failed to pay such $1,500,000 of the Purchase Price by the Closing Date of August 30, 2017 , and therefore, is in breach of the Agreement; but did pay some more of the Purchase Price after August 30, 2017, and requested Seller enter into an Amendment to the Agreement extending the time for payment of the Purchase Price until January 31, 2018, with the unpaid Purchase Price accruing interest at 12 percent per annum per the Agreement; and

WHEREAS, the parties entered into Amendment No. 1 to Stock Purchase Agreement ("Amendment") extending the time for the Buyer to pay the Purchase Price; and

WHEREAS, Buyer breached Amendment No. 1 by failing to timely pay the $500,000 of the Purchase Price by January 31, 2018 required under Amendment No. 1; and

WHEREAS, on August 16, 2018, since Buyer still had not paid the remaining $500,000 of Purchase Price, Seller elected to hold Buyer in default of the Agreement and elected to retain all of the Purchase Price paid to Seller as liquidated damages, and declare the Agreement null and void as to Buyer' s rights to purchase the Stock; and

WHEREAS, Buyer then desired Seller to reinstate the Agreement and withdraw the August 16, 2018 election to terminate letter of Exhibit B and give Buyer additional time to pay the remaining Purchase Price, interest and late fees under the Agreement.

WHEREAS, Seller agreed for the second time to give Buyer addition al time to pay the remaining Purchase Price pursuant to Amendment No. 2 to Purchase Agreement dated October 12, 2018; and

WHEREAS, the Buyer breached Amendment No. 2 by failing to timely pay the amounts owed under Amendment 2.

NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1.Buyer has paid Seller on January 2, 2019 the sum of $65,000, consisting of (i) $50,000 of interest/late fees/extension fees, (ii) $10,000 attorney/accounting fees, and (iii) $5,000 road work on Seller's mining properties needed due to the delay in Closing of the Agreement. None of the $65,000 is credited to the Purchase Price under the Agreement; but has been paid as a fee so Seller extends the Agreement. 

2.The balance of the Purchase Price owed, which is $250,365, shall be paid as follows: (i) 

$50,000 on or before January 31, 2019, (ii) $100,000 on or before February 28, 2019, and (iii) $100,365 on or before March 31, 2019. If any payments is not paid in collectible funds by wire transfer to Seller received on or before 5:00 p.m. central standard time by Seller on the dates above indicated; then all rights of the Buyer under the Agreement (as amended) shall become automatically null and void and Seller shall retain all monies paid Seller by Buyer as liquidated damages for Buyer's breach, and Seller shall have no further obligations to Buyer, including but not limited to, any obligation to transfer the Stock to Buyer pursuant to the terms of the Agreement (as amended).

3.Buyer acknowledges Seller has not made any representations or warranties to induce Buyer to sign the Agreement, Amendment 1, Amendment 2, and/or this Amendment 3. Buyer hereby releases, remises, discharges, indemnifies, and holds harmless Seller and BPC, (and their respective officers, directors, shareholders, agents, attorneys, accountants and assigns) from any and all liability, claims, lawsuits, investigations or causes of action regarding the Agreement (including Amendment 1, Amendment 2 and this Amendment 3), besides (i) the express obligations of Seller in Section 2.6 of the Agreement and (ii) the obligations of Seller to transfer the Stock, free and clear of liens and encumbrances, to Buyer if Buyer timely makes all payments hereunder, and signs the documents set forth in the Agreement at Closing. Buyer also releases, remises, discharges, indemnifies, and holds harmless any and all shareholders, directors, officers, agents, attorneys, accountants and assigns of Seller and/or BPC from any and all claims or causes of actions, known or unknown, contingent or liquidated, arising from the beginning of time to the date hereof regarding the Agreement, and acknowledges and agrees that it has only contracted with Seller under the Agreement and not with any individual. 

4.All capitalized words used herein shall have the same meaning as set forth in the Agreement. The name of Buyer was misspelled in the Agreement; the name is Santa Fe Acquisitions, LLC and this correction is reflected throughout the Agreement. 

5.Section 8.1 of the Agreement is modified so that all notices shall be addressed to Buyer at Santa Fe Acquisitions, LLC, c/o Attorney Thomas C. Pritchard, 800 Bering Drive, Suite 201, Houston, TX 77057, email pritchard@bplaw.com, facsimile 832-538-1265. 

6.Buyer has orally stated to Seller that Thomas Laws, prior President of Buyer, is no longer the chief executive officer or president of Buyer.   As such, Buyer represents and warrants to Seller that the person signing this Amendment No. 3 on behalf of Buyer has good and valid authority to bind Buyer to this Amendment No. 3. 

7.If Buyer timely pays all amounts due hereunder, then (i) Sections 2.7(A) of the Agreement will be deleted, and (ii) the Closing will take place on April 12, 2019 at 2:00 p.m. central standard time at the offices of Kilbourn Merchant Corporation, Germantown, Wisconsin pursuant to the remaining terms of the Agreement, with each party delivering to the other the documents and things required in the Agreement (as amended) without regard to the $1,500,000 Promissory Note referenced in Section 2.7 but with regard to the 2 percent NSR. 

8.Buyer acknowledges that prior to Closing, Bullard's Peak will transfer all its rights in the Granada Claim BLM Number 188086 to Robert Rodgers (or his assigns) for past consideration. 

9.This Amendment may be executed in any number of counterparts by email signatures and/or facsimile signatures and when put together shall be deemed an original Agreement. This Amendment No. 3 to the Agreement (with Exhibits), the Agreement, Amendment No. 1 and Amendment No. 2 to the Agreement, together constitute the entire Agreement between the Parties. 

Dated this day of   2019. 

SELLER: BLACK HAWK CONSOLIDATED MINES COMPANY		BULLARD’S PEAK CORPORATION
By:		By:
	Trevor Harder, President		Trevor Harder, President

BUYER: SANTA FE AQUISITIONS, LLC

By:

Name:

Title:

EX-21.1

SANTA FE GOLD CORPORATION SUBSIDIARIES

 

EX-23.1

 

Consent of Independent Registered Public Accounting Firm

To the Board of Directors of Santa Fe Gold Corp.:

We consent to the incorporation by reference in the Form 10-12g of Santa Fe Gold Corp. as to our report dated June 13, 2022, with respect to the consolidated Balance Sheets of Santa Fe Gold Corp. as of June 30, 2021, 2020 (restated) and 2019 (restated) and the related consolidated Statements of Operations, Statement of Shareholders’ Deficit and Statement of Cash Flows for the periods then ended. Our report dated June 13, 2022, relating to the financial statements includes an emphasis paragraph relating to an uncertainty as to the Company’s ability to continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the 2020 and 2019 consolidated financial statements have been restated to correct a misstatement.

We also consent to the reference to us under the caption “Experts” in the Registration Statement.

TAAD LLP.

Diamond Bar, California

June 13, 2022