10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q

þ	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 2019
¨	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________

Commission file number:  001-12974

SANTA FE GOLD CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	84-1094315
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

3544 Rio Grande Blvd.   NW

Albuquerque, NM   87107

(Address of Principal Executive Offices) (Zip Code)

(505) 255-4852

(Registrant’s telephone number, including area code)

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

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.002 par value	SFEG	OTC PINK

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Sec.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes þ No ¨

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

Large accelerated filer   ¨	Accelerated filer   ¨
Non-accelerated filer    ¨	Smaller reporting company  þ
(Do not check if smaller reporting company)	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(a) of the Exchange Act.  ¨

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).  Yes ¨ No þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 422,670,880 shares of common stock par value $0.002, of the issuer were issued and outstanding as of August 17, 2020.

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SANTA FE GOLD CORPORATION

INDEX TO FORM 10-Q

PART I

FINANCIAL INFORMATION

		Page
Item 1.	Financial Statements	3
	Consolidated Balance Sheets as of March 31, 2019 (Unaudited) and June 30, 2018	3
	Consolidated Statements of Operations for the Three Months and Nine Months Ended March 31, 2019 and 2018(Unaudited)	4
	Consolidated Statements of Changes in Stockholders’ Deficit for the Three Months and Nine Months Ended March 31, 2019 and 2018 (Unaudited)	5
	Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2019 and 2018 (Unaudited)	6
	Notes to the Unaudited Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	24
Item 4.	Controls and Procedures	24

PART II OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A	Risk Factors	26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27
Item 3.	Defaults Upon Senior Securities	27
Item 4.	Mine Safety Disclosures	27
Item 5.	Other Information	27
Item 6.	Exhibits	27
SIGNATURES		27
CERTIFICATIONS

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PART I
FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SANTA FE GOLD CORPORATION CONSOLIDATED BALANCE SHEETS
		March 31,			June 30,
		2019			2018*
		(Unaudited)			(Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	37,977		$	18,897
Prepaid expenses and other current assets		13,688			11,680
Total Current Assets		51,665			30,577
OTHER ASSETS:
Mineral property		3,015,000			2,500,000
Deposit on mineral leases		260,116			210,116
Investment in joint venture		—			25,000
Total Assets	$	3,326,781		$	2,765,693
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable	$	3,139,464		$	3,061,976
Accrued liabilities		7,453,870			6,906,930
Subscribed capital		—			2,772,191
Note payable and accrued interest related party		52,224			—
Notes payable		2,383,635			2,326,407
Completion guarantee payable		3,359,873			3,359,873
Total Current Liabilities		16,389,066			18,427,377
LONG TERM LIABILTY:
Shares subject to mandatory redemption by related party		—			1,638,000
		16,389,066			20,065,377
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT:
Common stock, $.002 par value, 550,000,000 and 300,000,000 shares authorized March 31, 2019 and June 30, 2018, respectively; 362,380,929 and 300,000,000 shares issued and outstanding March 31, 2019 and June 30, 2018, respectively		724,762			600,000
Additional paid-in capital		90,915,117			84,113,690
Accumulated deficit		(104,702,164	)		(102,013,374	)
Total Stockholders' Deficit		(13,062,285	)		(17,299,684	)
Total Liabilities and Stockholders' Deficit	$	3,326,781		$	2,765,693

*The balance sheet at June 30, 2018 has been derived from the audited consolidated financial statement at that date.

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

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SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended March 31,						Nine Months Ended March 31,
		2019			2018			2019			2018
REVENUES	$	—		$	—		$	—		$	—
OPERATING EXPENSES:
Exploration and mine related costs		32,718			3,317			40,407			37,914
General and administrative		1,835,213			253,184			2,354,003			1,213,839
Total Operating Expenses		1,867,931			256,501			2,394,410			1,251,753
LOSS FROM OPERATIONS		(1,867,931	)		(256,501	)		(2,394,410	)		(1,251,753	)
OTHER INCOME (EXPENSE):
Miscellaneous income		—			—			637			—
Gain on debt extinguishment		—			—			112,625			—
(Misappropriation) recovery of funds		—			(172,891	)		378,060			(226,099	)
Financing costs – commodity supply agreement		(60,830	)		(121,844	)		(166,725	)		(302,664	)
Interest on mandatory redemption shares by related party		(127,800	)		1,080,000			(127,800	)		(397,800	)
Interest expense		(161,583	)		(164,556	)		(491,177	)		(508,764	)
Total Other Income (Expense)		(350,213	)		620,709			(294,380	)		(1,435,327	)
LOSS BEFORE PROVISION FOR INCOME TAXES		(2,218,144	)		364,208			(2,688,790	)		(2,687,080	)
PROVISION FOR INCOME TAXES		—			—			—			—
NET LOSS AND COMPREHENSIVE LOSS	$	(2,218,144	)	$	364,208		$	(2,688,790	)	$	(2,687,080	)
Basic and Diluted Per Share Data:
Net (Loss) Per Share – Basic	$	(0.00)		$	0.00		$	(0.00	)	$	(0.01	)
Net (Loss) Per Share – Diluted	$	(0.00)		$	0.00		$	(0.00	)	$	(0.01	)
Weighted Average Common Shares Outstanding:
Basic		350,212,711			300,000,000			316,493,226			297,821,540
Diluted		350,212,711			300,075,000			316,493,226			297,821,540

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

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SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS IN STOCKHOLDERS’ DEFICIT

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2019 AND 2018

Three and Nine Months Ended March 31, 2019:	Common Stock				Additional 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	)
Change in loan shares evaluation		—		—		342,000			—			342,0001
Net income (loss)		—		—		—			146,292			146,292
Balances, September 30, 2018 (Unaudited)		300,000,000		600,000		84,455,690			(101,867,082	)		(16,811,392	)
Change in loan shares evaluation		—		—		(126,000	)		—			(126,000	)
Net income (loss)		—		—		—			(616,938	)		(616,938	)
Balances, December 31, 2018 (Unaudited)		300,000,000		600,000		84,329,690			(102,484,020	)		(17,554,330	)
Issuance of subscribed shares		39,768,462		79,537		3,210,454			—			3,289,991
Issuance of shares sold		3,433,333		6.867		251,133			—			258,000
Consulting shares issued		1,179,134		2,358		112,055			—			114,413
Reissuance of shares loaned by related party		18,000,000		36,000		1,854,000			—			1,890,000
Valuation change in loaned shares		—		—		(340,200	)		—			(340,200	)
Warrants issued		—		—		1,497,985			—			1,497,985
Net income (loss)		—		—		—			(2,218,144	)		(2,218,144	)
Balance, March 31, 2019 (Unaudited)		362,380,929	$	724,762	$	90,915,117		$	(104,702.164	)	$	(13,062,285	)

Three and Nine Months Ended March 31, 2018:	Common Stock				Additional Paid- In		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balances, June 30, 2017		295,601,634	$	591,204	$	83,955,637	$	(99,416,640	)	$	(14,869,799	)
Sales of common stock		4,398,366		8,796		20,870		—			29,666
Net income (loss)		—		—		—		(852,875	)		(852,875	)
Balances, September 30, 2017 (Unaudited)		300,000,000		600,000		83,976,507		(100,269,515	)		(15,693,008	)
Value of warrant issued		—		—		12,983		—			12,983
Net income (loss)		—		—		—		(2,198,413	)		(2,198,413	)
Balances, December31, 2017 (Unaudited)		300,000,000		600,000		83,989,490		(102,467,928	)		(17,878,438	)
Net income (loss)		—		—		—		364,208			364,208
Balances, March 31, 2018 (Unaudited)		300,000,000	$	600,000	$	83,989,490	$	(102,103,720	)	$	(17,514,230	)

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

SANTA FE GOLD CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
		Nine Months Ended
		March 31,
		2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(2,688,790	)	$	(2,687,080	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Stock based compensation		132,213			196,000
Costs associated issued warrants		1,497,985			12,983
Non-cash interest on mandatory redemption shares by related party		127,800			397,800
Gain on debt extinguishment		(112,625	)		—
Non-cash financing costs - commodity supply agreements		166,725			302,664
Net change in operating assets and liabilities:
Prepaid expenses and other current assets		(2,008	)		(11,821	)
Accounts payable and accrued liabilities		558,568			201,641
Net Cash Used in Operating Activities		(320,132	)		(1,587,813	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment on mineral property acquisition		(515,000	)		(2,500,000	)
Payments on mineral leases		(50,000	)		(210,116	)
Refund (deposit) in joint venture		25,000			(25,000	)
Net Cash Used in Investing Activities:		(540,000	)		(2,735,116	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock purchases		758,000			895,933
Proceeds from exercise of warrants		—			895,933
Proceeds from stock subscriptions not issued		—			2,275,073
Loan proceeds from note payable		239,750			—
Loan proceeds from related parties		51,462			—
Payments on note payable		(170,000	)		(25,000	)
Net Cash Provided by Financing Activities		879,212			4,041,939
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		19,080			(280,990	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		18,897			392,375
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	37,977		$	111,385
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	—		$	—
Cash paid for income taxes	$	—		$	—
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Common stock loaned and cancelled from related party	$	—		$	36,000
Reissuance of common stock loaned from related party	$	1,890,000		$	—

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

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SANTA FE GOLD CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(Unaudited)

NOTE 1 – COMPANY AND NATURE OF OPERATIONS

Santa Fe Gold Corporation, a Delaware corporation (the "Santa Fe”, "Company", “our” or “we”) is a U.S. copper, silver and gold exploration and mining company.

The accompanying unaudited financial statements and related notes present the Company’s consolidated financial position as of March 31, 2019 and June 30, 2018 (Audited), the consolidated results of operations for the three and nine months ended March 31, 2019 and 2018, and consolidated cash flows for the nine months ended March, 2019 and 2018. The unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended March 31, 2019, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2019. The accounting policies followed by the Company are set forth in Note 2 to the Company’s financial statements included in Form 10-K for the fiscal year ended June 30, 2019. These interim financial statements and notes thereto should be read in conjunction with the consolidated financial statements presented in the Company’s 2019 Annual Report on Form 10-K filed on July  15, 2020.

Nature of Operations

Santa Fe Gold Corporation 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.

Upon the Company emerging from the bankruptcy with a management team of two and 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.

On August 18, 2017, the Company signed the Bullard’s Peak Agreement and delivered $100,000 towards the purchase price. The Agreement is to purchase Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company and acquire 100% of the issued and outstanding capital stock for a cash purchase price in the aggregate amount of $3,000,000, and paid with installments stated in the Bullard’s Peak Agreement.

On January 4, 2019, the Company has entered into a purchase agreement with a mining operator to purchase two properties in western New Mexico, the Billali Mine and the Jim Crow Imperial Mine.  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.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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.

The Company has recorded a loss of $2,688,790 for the nine months ended March 31, 2019, and has a total accumulated deficit of $104,702,164 and a working capital deficit at March 31. 2019 of $16,337,401. The Company currently has no source of generating revenue.

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. 

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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 acquired new mining claims 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.

At March 31, 2019, the Company was in defaults on payments of approximately $7.87 million under a gold stream agreement (the “Gold Stream Agreement”) with Sandstorm Gold Ltd. (“Sandstorm”), other notes payable principle aggregating approximating $2.38 million, accrued liabilities of approximately $2.94 million and accounts payable approximating $3.05 million.

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, and Santa Fe Gold Barbados Corporation, a Barbados corporation, Santa Fe Acquisitions Company, a New Mexico Limited Liability Company and Minerals Acquisitions, LLC, a New Mexico Limited Liability Company. All significant inter-company accounts and transactions have been eliminated in consolidation.

On July 19, 2016, a new company was formed, Santa Fe Acquisition LLC (“SFA”) with Tom Laws, our CEO, as the signer, for the sole purpose of acquiring assets for Santa Fe Gold (“SFG”). On September 25, 2017, with an effective date of July 23, 2016, the CEO assigned ownership of SFA to Santa Fe Gold whereby SFG became to sole member of SFA resulting in SFA becoming a wholly owned subsidiary of SFG.  All major purchases were made through the SFA Company for the benefit of SFG, with the funding provided by SFG.

Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 period. 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, fixed assets, depreciation and amortization, accruals, derivative instrument liabilities, taxes and contingencies, and stock-based compensation which are discussed in the respective notes to the consolidated financial statements.

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts payable and accrued liabilities approximated their related fair values as of March 31, 2019 and June 30, 2017, due to the relatively short-term nature of these instruments. The carrying value of the Company's convertible notes payable approximates the fair value based on the terms at which the Company could obtain similar financing and the short-term nature 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.

Derivative Financial Instruments  

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. 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

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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 the 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.

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.

The Company has no financial derivative instruments in the current reporting periods.

Net Income (Loss) Per Share

Basic earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings per share are calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During the periods when they are anti-dilutive, common stock equivalents, if any, are not considered in the computation. For the three months ended March 31, 2019 and the nine months ended March 31, 2019 and 2018, the impact of outstanding stock equivalents has not been included as they would be anti-dilutive.

A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation is as follows:  

	Net Income (Numerator)		Weighted Average Common Shares (Denominator)		Per Share Amount
For the three months ended March 31, 2018
Basic EPS
Income available to common stockholders		$          364,208		300,000,000	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		75,000
Income available to common stockholders plus assumed conversions		$         364,208		300,075,000	$	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 vest over a period of six months to a year.

The Company accounts for share-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. Share based payments to nonemployees are valued at the earlier or a commitment date or completion of services. The Company had stock-based compensation of $132,213 for the nine months ending March 31, 2019, and $196,000 for the nine months ended March 31, 2018.

Accounting Standards to be Adopted in Future Periods

In May 2014, the FASB issued ASC updated No. 2014-09, Revenue from Contracts with Customers (Topic 606 (ASU 2014-09). Under the amendments in this update, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in this update are effective for fiscal years and interim periods within those years beginning after December 15, 2017. The new standard is required to be applied either retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of applying the update recognized at the date of initial application. The new standard was adopted by the Company the quarter ended September 30,2018, and will not have an impact on our consolidated financial statements until revenue is achieved.

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In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.  This ASU is effective for annual periods beginning after December 15, 2017 and interim periods within fiscal years. ASU No 2016-15 addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The Company adopted this standard effective July 1, 2018 and it will not have a material impact on the Company’s financial position or results of operations.

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 has not adopted Topic 842 as of the filing of this 10-Q and at this time the new standard will not have an impact on our consolidated financial statements until significant a lease agreement is entered.

In November 2016, the FASB has issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), which provides guidance on how restricted cash or restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This amendment is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The new standard was adopted by the Company in the quarter ended September 30, 2018, and will not have a significant impact on our consolidated financial statements

In May 2017, FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which amends the scope of modification accounting surrounding share-based payment arrangements as issued in ASU 2016-09 by providing guidance on the various types of changes which would trigger modification accounting for share-based payment awards. ASU 2017-09 is effective for annual periods beginning after December 15, 2017. The new standard was adopted by the Company in the quarter ended September 30, 2018, and the Company does not expect the adoption of ASU 2017-09 to have a material effect on its business or on its financial position, results of operations or cash flows.

In August 2018, ASU No. 2018-13 was issued to modify and enhance the disclosure requirements for fair value measurements. This update is effective in fiscal years, including interim periods, beginning after December 1, 2020, and early adoption is permitted.  The Company is currently evaluating this guidance and the impact on its Consolidated Financial Statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, 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 – DEPOSIT ON MINERAL PROPERTY

Acquisition of Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company

On August 18, 2017, the Company signed the Bullard’s Peak Agreement and delivered $100,000 towards the purchase price. The Agreement is to purchase Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company and acquire 100% of the issued and outstanding capital stock for an initial cash purchase price of $3,000,000, to be paid with installments stated in the Bullard’s Peak Agreement. Title to the claims and capital stock will be transferred upon receipt by seller of the full purchase price. Additional installments were made as follows through the end of the current reporting period towards the purchase price:  

- August 30, 2017, the Company delivered $900,000;

- September 8, 2017, the Company delivered $500,000;

- October 13, 2017, the Company delivered $500,000;

- January 2, 2018, the Company delivered $500,000;

- October 15, 2018, the Company delivered $100,000;

- October 31, 2018, the Company delivered $100,000;

- November 30, 2018, the Company delivered $100,000

- January 2 2019, the Company delivered $65,000

- February 1, 2019, the Company delivered $50,000

- February 28, 2019 Company delivered $100,000

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Purchase of four placer claims in British Columbia, Canada

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 remained in trust with the sellers until payment in full.  To date, the Company has paid to the sellers’ consideration of US$210,116.  The Company disclosed in a Form 8-K filing on November 20, 2018 that it had been notified that it was in default with respect to these two November 2017 agreements and that the sellers threatened legal action.  The Company has engaged British Columbia counsel to review the two November 2017 agreements and has concluded that there were false representations made by the sellers and that certain conditions precedent of sellers were not satisfied.  As a result, the Company’s position is that these two November 2017 agreements are not and were never binding and have requested sellers to refund the US$210,116.  The Company so informed sellers on March 4, 2019.  The Company continues to evaluate its rights and remedies in connection with this matter.  As a result, the Company does not own any rights to the four placer claims located in the Vernon mining district of British Columbia, Canada (which property is more fully set forth in the Form 8-K filing dated November 20, 2018).

Billali Mine and the Jim Crow Imperial Mine Mineral Interest

In January 2019 the Company has acquired rights to 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 Company entered into a purchase agreement with a mining operator in January 2019 to purchase two properties in western New Mexico, the Billali Mine, and the Jim Crow Imperial Mine.  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, with aggregate consideration for both definitive agreements payable as follows per Amendment Three that is effective as of May 1, 2020:

*$500,000 paid to date as of the filing date; 

*buyer to pay $50,000 monthly commencing   July 1, 2020, and continuing for the next subsequent 19 months; 

*commencing 30 days after the last payment above, and continuing for the for an additional 48 subsequent payments, buyer to make each 30 days  a payment in the amount of  $175,000; 

*after the final payment above and 30 days thereafter, the buyer will make the final payment of $100,000 completing the  purchase. 

*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. 

The Agreement has a 5% net smelter return (NSR) royalty on the nine patented Lode Claims with a royalty limit up to $650,000, and a 3% NSR thereafter.

Title and all rights and interest in the properties will be conveyed under the agreements upon completion of the payments of the purchase prices of the properties.

NOTE 4 – ACCRUED LIABILITIES

Accrued liabilities consist of the following at March 31, 2019 and June 30, 2018:

		March 31,		June 30,
		2019		2018
Interest	$	3,421,988	$	3,031,677
Vacation		15,770		15,770
Payroll		124,622		134,718
Franchise taxes		8,697		8,697
Merger costs, net		269,986		269,986
Other		19,579		19,579
Audit		18,557		18,557
Commodity supply agreement		3,321,148		3,154,423
Property taxes		253,523		253,523
	$	7,453,870	$	6,906,930

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NOTE 5 – 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 9- 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 uncredited liability totaled $3,359,873 at March 31, 2019 and June 30, 2018, respectively, and are reported as completion guarantee payable. Accrued interest on the completion guarantee payable at March 31, 2019 and June 30, 2018 was $1,190,652 and $1,058,357, respectively. Interest expense on the obligation for the nine months ended March 31, 2019 and 2018 was $132,295, respectively.

NOTE 6 - 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 has 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 will be 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 March 31, 2019 and June 30, 2018 was $0 and $1,638,000, respectively.

The shares were returned to the related party on January 23, 2019. The valuation of the shares on the return date was $1,890,000 and resulted in an interest charge of $127,800 and a credit to Additional Paid in Capital of $340,200 in the three months ended March 31, 2019.

NOTE 7 – NOTES PAYABLE

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 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.

A forbearance agreement by and among Santa Fe and Canarc Resource Corp. (“Canarc”) was entered into and effective as of February 12, 2018. Canarc loaned/advanced Santa Fe $220,000 in 2014. The funding requirements were not attained and the loan became due on January 15, 2015.  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 accrued interest on the note payable and note principle 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.

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%, with the equipment securing the loan. The balance owed on the note was $398,793 at March 31, 2019 and June 30, 2018 and had an accrued interest of $104,885 and $87,687, respectively. Interest expense on the note for the nine months ended March 31, 2019 and 2018 was $17,198 and $17,197, respectively. In December 2016 the court administered trust paid $17,412 to the note holder and was applied against the accrued interest on the note 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, currently is due and in default and the equipment has been returned to the vendor for sale and remains unsold at March 31, 2019.

During the nine months ended March 31, 2019, an individual loaned the Company $239,750 for working capital purposes. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender. Interest expense for the six months was $4,226 and accrued interest on the loan at March 31, 2019 is $4,226.

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In conjunction with the Merger Agreement, Tyhee and the Company entered into a Bridge Loan Agreement, 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 only $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 Agreement and Tyhee’s allocation of the proceeds from the Bridge Loan Agreement. At June 30, 2014, the Company recorded merger expenses that are due to Tyhee of $269,986 and is included in accrued liabilities at March 31, 2019 and June 30, 2018. This amount is net of a break fee of $300,000 due to the Company from Tyhee. Accrued interest on note at March 31, 2019 and June 30, 2018, was $2,050,916 and $1,736,513, respectively, is due and in default. Interest expense on the note for the nine months ended March 31, 2019 and 2018 was $314,403 and $323,516, respectively.

The following summarizes notes payable:		March 31,		June 30,
		2019		2018
Working capital advances, interest at 1% per month, due January 15, 2015	$	—	$	162,522
Merger advance		—		20,000
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
Note payable		239,750		—
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 - current	$	2,383,635	$	2,326,407

NOTE 8 – FAIR VALUE MEASUREMENTS

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.

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The Company’s financial instruments consist of derivative instruments which are measured at fair value on a recurring basis. The derivatives are measured on their respective origination dates, at the end of each reporting period and at other points in time when necessary, such as modifications, using Level 3 inputs in accordance with GAAP. The Company does not report any financial assets or liabilities that it measures using Level 1 or 2 inputs. The fair value measurement of financial instruments and other assets as of March 31, 2019 and June 30, 2018 are as follows:  

March 31, 2019
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	—	$	—

June 30, 2018
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	1,638,000	$	1,638,000

NOTE 9 – 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 continue 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 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 uncredited balance of the original $4,000,000 upfront deposit. See NOTE 5 - COMPLETION GUARANTY 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, 2019 and June 30, 2018, of 3,709 ounces of undelivered gold valued at approximately $3.32 and $3.15 million, respectively, in accrued liabilities 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.

Office and Real Property Leases

On August 1, 2015, the Company moved the office to a single room located in Albuquerque, NM, at the home of the CFO for a monthly rent of $500 until the Company is required to lease increased office space due to additional personnel requirements. Rental expense totaled $4,500 for the nine months ended March 31, 2019 and 2018, 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.

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NOTE 10- STOCKHOLDERS' DEFICIT

Stock Returned, Cancelled and Reissued

On July 28, 2017, a shareholder returned a certificate for 20,000,000 common shares to the Company for no value received by the shareholder and the investor was issued 2,000,000 shares on a new certificate. The net 18,000,000 cancelled shares are to be re-issued at a later time and the obligation will be accounted for as a derivative liability at the fair value of the shares and marked to market at each balance sheet date. The net 18,000,000 shares returned were recorded at Par Value of $36,000.The shares were returned to the related party on January 23, 2019. The valuation of the shares on the return date was $1,890,000 and resulted in an interest charge of $127,800 and a credit to Additional Paid in Capital of $340,200 in the three months ended March 31, 2019.

Increased Authorization of Common Shares

At the shareholders meeting held on January 11, 2019, in Albuquerque, New Mexico, and a majority of our shareholders voted to amend our certificate of incorporation to increase the authorized shares of common stock that we have authority to issue from 300,000,000 shares to 550,000,000 shares.

Issuance of Stock

Subscribed Capital and Share Issuance

Effective January 12, 2019, subscribed shares received or consultant shares granted prior to January 12, 2019, aggregating 39,768,462 shares of restricted common stock, were issued to the shareholders at purchase price of the shares and shares granted to consultants were issued at their value on the date of grants at a total value of $3,289,991.

During the three months ended March 31, 2019, the Company sold 3,433,333 shares of restricted common stock for aggregate cash proceeds of $258,000.

During the three months ended March 31, 2019, the Company granted issuance of 1,179,134 shares of restricted common stock for consulting services for an aggregate value of  $114,413 on the date of grants.

During the three months ended March 31, 2019, the Company reissued the 18,000,000  loaned shares from a related party at a market value on the date of issuance of $1,890,000.

The issuance of the restricted common shares during nine months ended March 31, 2019, were exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) and/ or Regulation S promulgated thereunder and thereof such issuance did not involve a public offering.

Issuance of Warrants and Expiration

During the nine months ended March 31, 2019, the Company issued no new warrants and 3,240,000 warrants expired.

Stock Options

During nine months ended March 31, 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 nine-month period 100,000 options expired.

Stock option and warrant activity, for the nine months ended March 31, 2019, are as follows:

	Stock Options		Stock Warrants
		Weighted		Weighted
		Average		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	—	—
Canceled	—	—	—	—
Expired	(100,000)	$0.08	(3,240,000)	$0.15
Exercised	—	—	—	—
Outstanding at December 31, 2018	30,100,000	$0.05	1,180,000	$0.15

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Stock options and warrants outstanding and exercisable at March 31, 2019 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	4.98	$	0.05	$	0.15	1,180,000	1,180,000	.34	$	0.15
$0.07	100,000	100,000	.76	$	0.07
	200,000	200,000						4,420,000	4,420,000
	Outstanding Options		4.96	$	0.05		Outstanding Warrants			.34	$	0.15
	Exercisable Options		4.96	$	0.05		Exercisable Warrants			.34	$	0.15

As of March 31, 2019, the aggregate intrinsic value of all stock options and warrants vested was $150,000. The intrinsic value of each 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 $0.055 closing stock price of the common stock on March 31, 2019.

The total intrinsic value associated with options exercised during the nine months ended March 31, 2019, 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.

NOTE 11 – RELATED PARTY TRANSACTIONS

In order to expedite purchases of equipment and associated expenses in Silver City on behalf of the Company, SFG deposited funds into Mr. Laws certified public accounting practice account until a new bank account was opened at Wells Fargo.  Company expenses and purchases of equipment were done in that account. During the fiscal year 2017 an aggregate of $926,000 was deposited  to Mr. Laws account or was paid out of the corporate account at Mr. Law’s direction. At the end of the 2017 fiscal year Mr. Laws submitted expenditures on behalf of the Company totaling $1,009,099. Subsequent to the 2017 fiscal year ended, the board directors of the Company appointed a special committee which determined the funds expended by Mr. Laws were misappropriated in the amount of $971,099 and a deposit of $38,000 was valid and refunded to the Company in a subsequent period. Of this amount, the $500,000 deposit that was to be made on the Alhambra Acquisition was subsequently determined never made the sellers. See NOTE 13 - Subsequent Events, Misappropriated Funds and Entry into a Material Definitive Agreement.

Prior to becoming a staff member of the Company, Mr. Laws our CEO, received a consulting fee and converted on January 1, 2018, to a full staff member.

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 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.

The board of directors formed a special committee on September 26, 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 Mr. Laws. The special committee investigation determined initially that Mr. Laws owes the Company $1,197,198, excluding penalty, accrued interest and additional associated costs. At the time of filing this Form 10-Q total costs associated with Mr. Laws is $1,651,263, including the additional incurred associated costs, of which $485,966 has been recovered by the Company from Mr. Laws. The Company does not anticipate collecting a material amount due from Mr. Laws and will be determined by the bankruptcy court.

The Company is in process of restating the previously issued consolidated financial statements for, and financial information relating to, the fiscal year ended June 30, 2017.

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Subsequent review of these transactions for the fiscal year ended June 30, 2017, resulted in a restatement of assets and operating costs in the amount of $971,099 and charged to the former chief executive officer.

Mr. Laws was terminated as the at-will chief executive officer of the Company on September 24, 2018.  Currently no interim chief executive officer has been named to replace Mr. Laws.  

In November 2018, Santa Fe filed a complaint in Luna County District Court, State of New Mexico, requesting a $930,000 money judgment against Mr. and Mrs. Laws, in addition to foreclosing on the mortgage Mr. and Ms. Laws granted to Santa Fe on real property to secure the promissory note located in Luna County, New Mexico. 

In November 2018, Santa Fe filed a similar complaint in Grant County District Court, State of New Mexico, as Mr. and Mrs. Laws and XYZ Ranch Estates, LLC granted Santa Fe a deed of trust and a mortgage, respectively, on several pieces of real property in Grant County, New Mexico. Mr. Laws also granted Santa Fe a security agreement on an airplane located in Grant County, New Mexico.  The complaint in Grant County requested a money judgment in the amount of $930,000 against Mr. and Mrs. Laws, in addition to a request to foreclose on the assets pledged to us located in Grant County, New Mexico. 

As of the filing of this report, Mr. Laws has pleaded guilty to various charges brought against him by government officials, which include the Company allegations. Mr. Laws is currently awaiting sentencing on the pleaded to charges. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court.

On August 9, 2017, a related party shareholder returned a certificate for 20,000,000 common shares to the Company for no value received by the shareholder and the investor was issued 2,000,000 shares on a new certificate. The net 18,000,000 cancelled shares are to be re-issued at a later time and the obligation will be accounted for under ASC 480, “Distinguishing Liabilities from Equity” at the fair market value of the shares and marked to market at each balance sheet date. On April 4, 2018, the investor became a director of the Company. See NOTE 6 – SHARE OBLIGATION TO RELATED PARTY for additional disclosures. On January 23, 2019, the loaned shares were reissued to the related party.

An individual consultant, who is instrumentally helpful to the Company in raising funds and is compensated on consulting basis, as disclosed in NOTE 13 – SUBSEQUENT EVENTS, Recent Issuances of Unregistered Securities. During the three months ended September 30, 2018, received the final finder’s fees totaling $20,000 on August 14, 2018.

During the quarter ended December 2018 and March 2019, our chief financial officer the Company loaned the Company $51,462 for working capital purposes. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender. Interest expense for the nine months ended March 31, 2019, is $762, and accrued interest at March 31, 2019 is $762.

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 12 – LEGAL PROCEEDINGS

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

Boart Long year 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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $13,860 and recorded $21,454 in legal fees awarded in the judgement. In December 2016 the court administered trust paid $6,287 to Bogart Longyear and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31,2019 and 2018, the Company accrued interest on the obligation of $4,194, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $26,264 and $20,019, respectively. Interest expense on the obligation for the nine months ended March 31,2019 and 2018 was $6,245 and $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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $26,875. In December 2016 the court administered trust paid $4,591 to Wagner equipment and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31,

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2019 and 2018, the Company interest expense on the obligation was $7,605, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $45,045 and $37,440, 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.

The Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) have each initiated investigation into the Company and certain other individuals, resulting from the Laws transactions and related misappropriation of funds described herein.  The SEC has obtained a formal order to investigate the Company.  The DOJ investigation is still preliminary. These types of investigations are expensive, time-consuming for management, and unpredictable – often resulting in other aspects of the Company’s operations becoming subject to regulatory scrutiny.  These investigations are ongoing and no prediction can be made regarding the timing or outcome of such matters including remedial action pursued against the Company and others, including its officers and directors.   

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.

We are subject from time to time to litigation, claims and suits arising in the ordinary course of business. Other than the above-described litigation, as of December 31, 2018, we were not a party to any material litigation, claim or suit whose outcome could have a material effect on our financial statements.

Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of its financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company discloses the nature of the loss contingencies, together with an estimate of the range of possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain unresolved proceedings are not presently determinable, and an estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be reasonably made, an adverse outcome from such proceedings could have a material adverse effect on its financial statements in any given reporting period. However, in the opinion of Management, after consulting with legal counsel, the ultimate liability related to the current outstanding litigation is not expected to have a material adverse effect on its financial statements.

NOTE 13 – SUBSEQUENT EVENTS

Recent Issuances of Unregistered Securities

In the period from April 2019 through August 14, 2020, the Company sold an aggregate of 46,775,910 restricted common shares to ten existing accredited shareholders and two new accredited investors and the Company received aggregate proceeds of $2,893,980 from these sales. In addition, our chairman purchased 7,892,858 restricted common shares for $475,000. The issuance of the restricted common shares, were exempt from registration requirements of the Security Act of 1933, as amended, pursuant to Section 4(a)2, thereof because such issuance did not involve a public offering. In connection with the placements, the Company incurred no consulting fees.

During the period April 2019 through August 14, 2020, the Company issued restricted 2,656,884 shares of common stock for consulting services at an aggregated market value of $237,381 on the date of issuance. The issuance of the restricted common shares, were exempt from registration requirements of the Security Act of 1933, as amended, pursuant to Section 4(a)2, thereof because such issuance did not involve a public offering.

In the period from April 1, 2019 through August 14, 2020, the Company issued warrants to accredited  investors aggregating 4,500,000, and 2,250,000 warrants to the chairman of the board that were attached to restricted stock purchases. The warrants were vested at issuance, have a three-year life and an exercise price of $0.05 and $0.07 per share.

On April 10, 2020, the Company converted $100,000 of accrued salary for the Company CFO into 2,000,000 shares of restricted common stock at a market value of $117,000 on the date on grant and recorded a loss on debt conversion of $17,000. Warrants issued in conjunction with the conversion were 1,000,000 vested three-year warrants and have an exercise price of $0.05 per share.

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On June 30, 2020, the Company converted a note payable with the Company CFO consisting of principal and interest of $42,036 and $6,178, respectively, into 964,299 shares of restricted common stock at $0.05 per share. The market value on the date of conversion was $67,501 and on the date of conversion the Company recorded a loss on debt conversion of $19,287. In conjunction with the conversion 482,149 vested three-year warrants were granted and have an exercise price of $0.05 per share.

Alhambra Acquisition

Pursuant to a stock purchase agreement dated August 2017, the Company will acquire all the capital stock of Bullard’s Peak Corporation (which owns five patented claims and 82 unpatented claims in the Black Hawk district of New Mexico) from Black Hawk Consolidated Mines Company for a purchase price of $3,000,000, and the capital stock of Bullard’s Peak Corporation and the mining claims collateralize the full purchase price payment.  The Company granted the seller a 2% net smelter return in perpetuity.  The net smelter return is 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.  Title to the claims will be transferred upon receipt by seller of the full purchase price.  In August 2018, the Company was informed that the seller terminated the stock purchase agreement.  Pursuant to an amendment to the stock purchase agreement in October 2018, the Company paid the seller $100,000 and the seller rescinded the August 2018 election to terminate the stock purchase agreement and waived all then existing events of default and any additional interest, late fees, and other damage claims due to the Company’s prior breaches of the stock purchase agreement.  On October 31, 2018, the Company paid the seller an additional $100,000.  The balance of the purchase price of $350,365 (which includes $50,365 of expenses that the Company agreed to reimburse seller) is required to be paid: (i) $100,000 on or before November 30, 2018 and (ii) $250,365 on or before December 31, 2018.  If any payment is not timely paid, all rights of the Company under the stock purchase agreement shall become automatically null and void and seller shall retain all monies paid as liquidated damages for the Company’s breach, and seller shall have no further obligations to the Company, including but not limited to, any obligation to transfer the capital stock of Bullard’s Peak Corporation to the Company pursuant to the terms of the stock purchase agreement. We paid $100,000 in November 2018 with respect to the Alhambra Silver Mine acquisition and owed a balance of approximately $250,000 on December 31, 2018, to complete the acquisition. Lack of funding on December 31, 2018 resulted in us entering into a third amendment pursuant to which we paid $65,000 on January 2, 2019, a late fee payment on February 1, 2019 of $50,000, a $100,000 on February 28, 2019, and the final payment of $100,365 was paid on April 2, 2019, for the total cost of $3,115,365.

In February 2018, the Company filed for a permit to start operations at the Bullard’s Peak property. The permit was awarded on March 7, 2018. As of the filing of this report, no operations have commenced.

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 Company common stock.  Title to these claims remained in trust with the sellers until payment in full.  To date, the Company has paid to the sellers’ consideration of Can$260,000.  The Company disclosed in a Form 8-K filing on November 20, 2018 that it had been notified that it was in default with respect to these two November 2017 agreements and that the sellers threatened legal action.  The Company has engaged British Columbia counsel to review the two November 2017 agreements and has concluded that there were false representations made by the sellers and that certain conditions precedent of sellers were not satisfied.  As a result, the Company’s position is that these two November 2017 agreements are not and were never binding and have requested sellers to refund the Can$260,000.  The Company so informed sellers on March 4, 2019.  The Company continues to evaluate its rights and remedies in connection with this matter.  As a result, the Company does not own any rights to the four placer claims located in the Vernon mining district of British Columbia, Canada (which property is more fully set forth in the Form 8-K filing dated November 20, 2018). At the time of the filing of this report the agreements are being scheduled for arbitration by the Company attorney. At June 30, 2019, the Company impaired the investment in the amount of $210,116.

Misappropriation of Funds and Entry into a Material Definitive Agreement

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 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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The board of directors formed a special committee on September 26, 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 Mr. Laws. The special committee investigation determined initially that Mr. Laws owes the Company $1,197,198, excluding penalty, accrued interest and additional associated costs. At the time of filing this Form 10-Q total costs associated with Mr. Laws is $1,651,263 of which $485,966 has been recovered by the Company. The Company does not anticipate collecting a material amount due from Mr. Laws and will be determined by the bankruptcy court

The Company is in process of restating the previously issued consolidated financial statements for, and financial information relating to, the fiscal year ended June 30, 2017.

Subsequent review of these transactions for the fiscal year ended June 30, 2017, resulted in a restatement of assets and operating costs in the amount of $971,099 and charged to the former chief executive officer.

Mr. Laws was terminated as the at-will chief executive officer of the Company on September 24, 2018.  Currently no interim chief executive officer has been named to replace Mr. Laws.  

In November 2018, Santa Fe filed a complaint in Luna County District Court, State of New Mexico, requesting a $930,000 money judgment against Mr. and Mrs. Laws, in addition to foreclosing on the mortgage Mr. and Ms. Laws granted to Santa Fe on real property to secure the promissory note located in Luna County, New Mexico. 

In November 2018, Santa Fe filed a similar complaint in Grant County District Court, State of New Mexico, as Mr. and Mrs. Laws and XYZ Ranch Estates, LLC granted Santa Fe a deed of trust and a mortgage, respectively, on several pieces of real property in Grant County, New Mexico. Mr. Laws also granted Santa Fe a security agreement on an airplane located in Grant County, New Mexico.  The complaint in Grant County requested a money judgment in the amount of $930,000 against Mr. and Mrs. Laws, in addition to a request to foreclose on the assets pledged to us located in Grant County, New Mexico. 

As of the filing of this report, Mr. Laws has pleaded guilty to various charges brought against him by government officials, which include the Company allegations. Mr. Laws is currently awaiting sentencing on the pleaded to charges. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court.

Extinguishment of Debt

Based upon a legal opinion from our British Columbia legal consul, the Company at June 30, 2019,  wrote off of two financing facilities under British Columbia law where the statute of limitations had run out pursuant to the Limitations Act (British Columbia) and that no future claims can be commenced in the Providence of British Columbia and the Company has no outstanding legal obligation on the finance facilities. The Company also paid off a negotiated settlement under a Forbearance Agreement during our fiscal year ended June 30, 2019, and wrote off the remaining obligation balance.

Merger Agreement, loan balance	$ 1,745,092
Merger Agreement, loan accrued interest	2,155,335
Merger Agreement accrued fees	269,986
Goldstream loan balance	3,742,505
Completion Guaranty accrued interest	1,234,749
Completion Guaranty Payable	3,359,873
Forbearance Agreement	112,625
Total Debt Extinguishment	$ 12,620,165

ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Form 10-Q 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,”

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“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-Q 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;

•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 high quality gold, silver and/or copper properties. 

The Company does not intend to undertake to update the information in this Form 10-Q if any forward-looking statement later turns out to be inaccurate.

The following discussion summarizes the results of our operations for the three and the nine months ending March 31, 2019 and 2018, but with the knowledge that Santa Fe Gold with all its subsidiaries filed for Bankruptcy - Chapter 11 in August 2015 and the case was dismissed from bankruptcy on June 15, 2016.

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Basis of Presentation and Going Concern

The consolidated unaudited 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. As a result of these circumstances, management concluded that there is substantial doubt regarding the Company’s ability to continue as a going concern as it is currently structured.

The future of the Company is discussed in the 10-K filings for the fiscal year ended June 30, 2017.

Santa Fe Gold Corporation (“Santa Fe”, "the Company”, “our” or “we”) is a U.S. mining company, incorporated in 1991 in the state of Delaware. Our general business strategy is to acquire explore, develop and to create shareholder value.

The Company has recorded a loss of $2,688,790 or the nine months ended March 31, 2019, and has a total accumulated deficit of $104,702,164 and a working capital deficit at March 31, 2019, of $16,337,401. The Company currently has no source of generating revenue.

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 acquired new mining claims 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.

On March 31, 2019, the Company was in default on payments of approximately $7.87 million under a gold stream agreement (the “Gold Stream Agreement”) with Sandstorm Gold Ltd. (“Sandstorm”) and other notes payable principle aggregating $2,143,885 and accrued interest on the notes of $2,155,801.

The results of operations in the past reflected a continued under-capitalization of our projects which required additional funding to be able to achieve full project performance and sustained potential profitability. We currently are dependent on additional financing to resume any mining operations and to continue our exploration efforts in the future if warranted.

Operating Results for the Three Months Ended March 31, 2019 and 2018

Sales, net

During the three months ended March 31, 2019 and 2018, the Company had no revenue in the periods of measurements.

Operating Costs and Expenses

Our operating cost incurred in three months ended March 31, 2019, increased $1,611,430 from $256,501 in the three months ended March 31, 2018, to $1,867,931 for the current period of measurement. The increase in operating costs in the current period of measurement is mainly attributable increased general and administrative of $1,582,029.

This increase in general and administrative consist mainly of increases in consulting fees of $94,113, legal fees of $32,261, non-cash costs of warrants issued of $1,497,985 and is offset by a decrease in salary burden of $43,462.

Other Income (Expense)

Other income (expense) for three months ended March 31, 2019, was $(350,213) as compared to $620,709 for three months ended March 31, 2018, a decrease in other income of $970,922. The net decrease in other income for the current period measurement is mainly comprised of the following component decrease in interest income change on interest on mandatory redemption shares by related party of $1,207,800. This decrease was offset by a decreased in misappropriated funds of $172,891 and a decrease in financing costs – commodity supply agreement of $61,014.

For the three months ended March 31, 2019, financing costs – commodity supply agreements had a decreased loss of $61,014 from the comparable period of measurement. The financing costs for commodity supply agreements relate directly to production delivery of refined precious metals to Sandstorm in the prior period of measurement. The financing costs are adjusted period-to-period based upon the total number of undelivered gold and silver ounces outstanding at the end of each period. The decrease in the current period of measurement is driven by a decrease in precious metals prices.

The interest on mandatory redemption shares by related party of $127,800 is a result of 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

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as a designated interest expense. Any decrease in valuation from the initial valuation will be recorded to Addition Paid in Capital as the obligation is to a related party of the Company.

Operating Results for the Nine Months Ended March 31, 2019 and 2018

Sales, net

During the nine months ended March 31, 2019 and 2018, the Company had no revenue in the periods of measurements.

Operating Costs and Expenses

Our operating cost incurred in nine months ended March 31, 2019, increased $1,142,657 from $1,251,753 in the nine months ended March 31, 2018,  to $2,394,410 for the current period of measurement. The increase in operating costs in the current period of measurement is mainly attributable increased general and administrative of $1,140,164.

The increases in general and administrative in the current period of measurement are mainly attributable to increases in legal fees of $104,188 and a non-cash cost of options issued aggregating $1,497,985. These increases were offset by decreases in salary burden of $42,957 and consulting fees of $418,695.

Other Income (Expense)

Other income (expense) for nine months ended March 31, 2019, was $(294,380) as compared to $(1,435,327) for nine months ended March 31, 2018, a decrease in other expense of $1,140,947. The net decrease in other expenses for the current period measurement is mainly comprised of decreased losses in the following components: misappropriation of funds of $604,159, financing costs – commodity supply agreement of $135,939 and interest on mandatory redemption shares by related party of $270,000, and a gain on debt extinguishment of $112,625.

During the current period of measurement, the Company received reimbursements of misappropriated funds aggregating $378,060 as compared to the prior period of measurement loss of $226,099, a change of $604,159.

For the nine months ended March 31, 2019, financing costs – commodity supply agreements had a decreased loss of $166,725 from the comparable period of measurement, which had a loss of $302,664. The financing costs for commodity supply agreements relate directly to production delivery of refined precious metals to Sandstorm in the prior period of measurement. The financing costs are adjusted period-to-period based upon the total number of undelivered gold and silver ounces outstanding at the end of each period. The decrease in the current period of measurement is driven by a decrease in precious metals prices.

The interest on mandatory redemption shares by related party of $127,800 in the current period of measurement is a result of 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 will be recorded to Addition Paid in Capital as the obligation is to a related party of the Company.

The decrease in interest expense for the current period of measurement was $17,587, and is a result of a decrease in interest bearing loan balances.

Liquidity and Capital Resources; Plan of Operation

As of March 31, 2019, we had cash of $37,977 and we had a working capital deficit of $16,337,401.

At March 31, 2019, the Company was in defaults on payments of approximately $7.87 million under a gold stream agreement (the “Gold Stream Agreement”) with Sandstorm Gold Ltd. (“Sandstorm”), other notes payable principle aggregating approximating $2.38 million, accrued liabilities of approximately $2.94 million and accounts payable approximating $3.05 million.

The Company upon emergence resorted to selling equity for cash so as to proceed on reviving the Company. Currently we have no continuing commitment from any party to provide necessary additional working capital, or if one becomes available, there is no certainty that its terms will be favorable or acceptable to the Company to continue its current business plan.

On July 19, 2016, a new company was formed: Santa Fe Acquisition LLC (“SFA”) with Tom Laws, our CEO, as the signer, for the sole purpose of acquiring assets for Santa Fe Gold (“SFG”). On September 25, 2017, with an effective date of July 23, 2016, the CEO assigned ownership of SFA to Santa Fe Gold whereby SFG became to sole member of SFA resulting in SFA becoming a wholly owned subsidiary of SFG.  All major purchases were made through the SFA Company for the benefit of SFG, with the funding provided by SFG.     

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During the nine months ending March 31, 2019, the Company continued to implement its initial plan to emerge from the bankruptcy proceedings. The Company raised $758,000 from the sale of common stock subscriptions and received cash loans from two related parties aggregating $249,750 and deferred payroll added to the notes of $41,462. The funds were used as working capital to implement the Company business plan.

On August 18, 2017, the Company signed the Bullard’s Peak Agreement and delivered $100,000 towards the purchase price. The Agreement is to purchase Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company and acquire 100% of the issued and outstanding capital stock for a cash purchase price in the aggregate amount of $3,000,000, to be paid with installments stated in the Bullard’s Peak Agreement. Payments on the purchase price for the nine months ended March 31, 2019 were $515,000.

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

ITEM 4 – CONTROLS AND PROCEDURES

During the three months ended March 31, 2019, our management, with the participation of our Chairman and Chief Financial Officer of the Company at that time, carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended. Our Chairman and Interim Chief Financial Officer have concluded that, as of March 31, 2019, our disclosure controls and procedures were not effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the required time periods and are designed to ensure that information required to be disclosed in our reports is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. This was due to the following material weakness.

Due to the Company’s continuing financial condition, the Company had limited personnel which resulted in a lack of segregation of duties and a lack of formal reviews at multiple levels. A significant weakness existed that our then current Chief Executive Officer, also a CPA, insisted on maintaining various original detail financial records at his office and not the corporate office. The lack of not receiving these original documents and related reviews, resulted in the Company uncovering a misappropriation of Company funds by the then current Chief Executive Officer.

Inherent Limitations over Internal Controls

The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (“GAAP”).

While present in our design of internal controls, our internal controls over financial reporting and disclosure are not written; however, the operation of many controls are in place and are applied on a consistent basis. Company personnel perform controls standard to: 1) approve all Company expenditures, 2) approve and sign contractual obligations, 3) reconcile bank accounts and other general ledger accounts, and 4) many other similar rudimentary controls applied as best practice.

However, we have concluded that due to the Company’s small size and limited personnel available to perform control functions, and the weakness described above, the Company was precluded from applying adequate segregation of duties in financial transactions. The Company has taken steps to assure all original financial documents are received and maintained at the corporate office. The material weaknesses described are common to companies of our similar size and staffing in our industry. We expect these material weakness conditions to continue for the foreseeable future, or until Company growth results in additional personnel to perform segregated financial functions.

Management, including the Company’s Chairman and Chief Financial Officer, does not expect that the Company’s internal controls will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of internal controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, any evaluation of the effectiveness of controls in future periods are subject to the risk that those internal controls may become inadequate because of changes in business conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Exchange Act, during the three months ended September 30, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

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

Boart Long year 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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $13,860 and recorded $21,454 in legal fees awarded in the judgement. In December 2016 the court administered trust paid $6,287 to Bogart Longyear and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31,2019 and 2018, the Company accrued interest on the obligation of $4,194, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $26,264 and $20,019, respectively. Interest expense on the obligation for the nine months ended March 31,2019 and 2018 was $6,245 and $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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $26,875. In December 2016 the court administered trust paid $4,591 to Wagner equipment and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31, 2019 and 2018, the Company interest expense on the obligation was $7,605, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $45,045 and $37,440, 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.

The Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) have each initiated investigation into the Company and certain other individuals, resulting from the Laws transactions and related misappropriation of funds described herein.  The SEC has obtained a formal order to investigate the Company.  The DOJ investigation is still preliminary. These types of investigations are expensive, time-consuming for management, and unpredictable – often resulting in other aspects of the Company’s operations becoming subject to regulatory scrutiny.  These investigations are ongoing and no prediction can be made regarding the timing or outcome of such matters including remedial action pursued against the Company and others, including its officers and directors.   

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.

We are subject from time to time to litigation, claims and suits arising in the ordinary course of business. Other than the above-described litigation, as of December 31, 2018, we were not a party to any material litigation, claim or suit whose outcome could have a material effect on our financial statements.

Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of its financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company discloses the nature of the loss contingencies, together with an estimate of the range of possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain

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unresolved proceedings are not presently determinable, and an estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be reasonably made, an adverse outcome from such proceedings could have a material adverse effect on its financial statements in any given reporting period. However, in the opinion of Management, after consulting with legal counsel, the ultimate liability related to the current outstanding litigation is not expected to have a material adverse effect on its financial statements.

ITEM 1A. RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described in our annual report on Form 10-K for our year fiscal ended June 30, 2019, although we may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings. If any of the risks described actually occurs, our business, financial condition or results of operations would likely suffer. In that case, the trading price of our common stock could fall.

Except as set forth herein, Santa Fe Gold and all its subsidiaries, filed for bankruptcy protection under Chapter 11 in the state of Delaware, Case # 15-11761-MFW on August 26, 2015 and on June 15, 2016, the case was dismissed on June 15, 2016. The Company’s most current risk factors are disclosed in our Annual Report filed with the Commission on Form 10-K for the fiscal year ended June 30, 2019 to the SEC on July 15, 2020 and are incorporated herein by reference.

ITEM 2. UNREGISTERED SALE OF EQUITY SECURITIES AND USE OF PROCEEDS

Subscribed Capital and Issued Shares

Between January 1, 2019 and March 31, 2019, in reliance upon the exemptions from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation S promulgated thereunder, the Company accepted stock subscriptions from six existing accredited investors and issued an aggregate of 5,308,333 shares at $0.08 per share of the Company’s restricted common stock, for an aggregate consideration of $408,000. Shareholder approval to increase the Company’ authorized common shares was granted on January 11, 2019. All shares subscribed or granted prior to January 11, 2019 were issued on January 12, 2019 or on the date subscribed or granted after January 12, 2019. There were no subsequent or contemporaneous public offerings of the Company’s common stock or other securities. The shares of the Company’s restricted common stock were not broken down into smaller denominations and negotiations for the issuance of the shares took place directly between the investor and the Company.

Effective January 12, 2019, subscribed shares accepted or consultant shares granted prior to January 12, 2019, aggregating 39,768,462 shares of restricted common stock, were issued to the shareholders at purchase price of the shares and shares granted to consultants were issued at their value on the date of grants at a total value of $3,289,991.

During the three months ended March 31, 2019 and after January 12, 2019, the Company granted issuance of 1,179,134 shares of restricted common stock for consulting services for an aggregate value of  $114,413 on the date of grants.

During the three months ended March 31, 2019, the Company reissued the 18,000,000  loaned shares from a related party at a market value on the date of issuance of $1,890,000.

The issuances of the restricted common shares during the three months ended March 31, 2019, were exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a) (2) thereof  and / or Regulation S promulgated thereunder and/or because such issuances did not involve a public offering and/or because such sales were to non-US-persons. The cash proceeds were utilized for working capital by the Company. In connection with transactions referenced above, other than issuances to the Company’s officers, directors, employees and consultants for services, the Company obtained representations from each investor  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.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

With the filing of bankruptcy protection on August 26, 2015, all securities are in default and all but Waterton remain after the dismissal of the proceedings on June 15, 2016.

25

ITEM 4. MINE SAFETY DISCLOSURES  

Pursuant to Section 1503(a) of the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act (The “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the fiscal years ended June 30, 2019, 2018 and 2017, our U.S. exploration properties were not subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”) as no mining activity had commenced. There are no such disclosures to be made at this time.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS  

(a)The following exhibits are filed as part of this report: 

Exhibit	Description
31.1	Certification of Chief Financial Officer and Principle Accounting Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a).
32.1	Certification of Chief Financial Officer and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350.

SIGNATURES:

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 17, 2020	/s/ Stephen J. Antol
	Stephen J. Antol Chief Financial Officer, Principal Accounting Officer

26

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULE 13A-14 OR 15D-14 OF THE SECURITIES
EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF
THE SARBANES-OXLEY ACT OF 2002

I, Stephen J. Antol, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Santa Fe Gold Corporation (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 17, 2020	/s/ Stephen J. Antol
	Stephen J. Antol
	Chief Financial Officer, Principal Accounting Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

          In connection with this Quarterly Report of Santa Fe Gold Corporation, (the “Company”) on Form 10-Q for the three-month period ended March 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of our knowledge:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company, as of, and for the periods presented in the Report.

Date: August 17, 2020	/s/ Stephen J. Antol
	Stephen J. Antol
	Chief Financial Officer, Principal Accounting Officer

XML

Document and Entity Information - shares	9 Months Ended
	Mar. 31, 2019	Aug. 17, 2020
Text Block [Abstract]
Registrant Name	SANTA FE GOLD CORPORATION
Registrant CIK	0000851726
SEC Form	10-Q
Period End date	Mar. 31, 2019
Fiscal Year End	--06-30
Tax Identification Number (TIN)	84-1094315
Number of common stock shares outstanding		422,670,880
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Amendment Flag	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Entity File Number	001-12974
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	3544 Rio Grande Blvd.
Entity Address, Address Line Two	NW
Entity Address, City or Town	Albuquerque
Entity Address, State or Province	NM
Entity Address, Postal Zip Code	87107

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2019	Jun. 30, 2018
CURRENT ASSETS:
Cash and cash equivalents	$ 37,977	$ 18,897
Prepaid expenses and other current assets	13,688	11,680
Total Current Assets	51,665	30,577
OTHER ASSETS:
Mineral properties	3,015,000	2,500,000
Deposit on mineral leases	260,116	210,116
Investment in joint venture	0	25,000
Total Assets	3,326,781	2,765,693
CURRENT LIABILITIES:
Accounts payable	3,139,464	3,061,976
Accrued liabilities	7,453,870	6,906,930
Subscribed capital	0	2,772,191
Notes payable and accrued interest to related party	52,224	0
Notes payable	2,383,635	2,326,407
Completion guarantee payable	3,359,873	3,359,873
Total Current Liabilities	16,389,066	18,427,377
LONG TERM LIABILTY:
Shares subject to mandatory redemption by related party		1,638,000
Total Liabilities	16,389,066	20,065,377
STOCKHOLDERS' DEFICIT:
Common stock, $.002 par value, 550,000,000 and 300,000,000 shares authorized March 31, 2019 and June 30, 2018, respectively; 362,380,929 and 300,000,000 shares issued and outstanding March 31, 2019 and June 30, 2018, respectively	724,762	600,000
Additional paid in capital	90,915,117	84,113,690
Accumulated deficit	(104,702,164)	(102,013,374)
Total Stockholders' Deficit	(13,062,285)	(17,299,684)
Total Liabilities and Stockholders' Deficit	$ 3,326,781	$ 2,765,693

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2019	Jun. 30, 2018
Text Block [Abstract]
Common Stock, Par or Stated Value Per Share	$ 0.002	$ 0.002
Common Stock, Shares Authorized	550,000,000	300,000,000
Common Stock, Shares, Issued	362,380,929	300,000,000
Common Stock, Shares, Outstanding	362,380,929	300,000,000

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018
Income Statement [Abstract]
REVENUES	$ 0	$ 0	$ 0	$ 0
OPERATING EXPENSES:
Exploration and mine related costs	32,718	3,317	40,407	37,914
General and administrative	1,835,213	253,184	2,354,003	1,213,839
Total Operating Costs and Expenses	1,867,931	256,501	2,394,410	1,251,753
LOSS FROM OPERATIONS	(1,867,931)	(256,501)	(2,394,410)	(1,251,753)
OTHER INCOME (EXPENSE):
Miscellaneous income	0	0	637	0
Gain on debt extinguishment	0	0	112,625	0
(Misappropriation) recovery of funds	0	(172,891)	378,060	(226,099)
Financing costs - commodity supply agreements	(60,830)	(121,844)	(166,725)	(302,664)
Interest on mandatory redemption shares by related party	(127,800)	1,080,000	(127,800)	(397,800)
Interest expense	(161,583)	(164,556)	(491,177)	(508,764)
Total Other Income (Expense)	(350,213)	620,709	(294,380)	(1,435,327)
LOSS BEFORE PROVISION FOR INCOME TAXES	(2,218,144)	364,208	(2,688,790)	(2,687,080)
PROVISION FOR INCOME TAXES	0	0	0	0
NET LOSS AND COMPREHENSIVE LOSS	$ (2,218,144)	$ 364,208	$ (2,688,790)	$ (2,687,080)
Basic and Diluted Per Share Data:
Net (Loss) Per Share - Basic	$ .00	$ .00	$ (0.00)	$ (0.01)
Net (Loss) Per Share - Diluted	$ 0.00	$ 0.00	$ (0.00)	$ (0.01)
Weighted-average number of shares used in per share calculation - Common Stock:
Basic	350,212,711	300,000,000	316,493,226	297,821,540
Diluted	350,212,711	300,075,000	316,493,226	297,821,540

XML

CONSOLIDATED STATEMENTS IN STOCKHOLDERS’ DEFICIT (Unaudited) - USD ($)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Jun. 30, 2017	$ 591,204	$ 83,955,637	$ (99,416,640)	$ (14,869,799)
Shares, Outstanding, Beginning Balance at Jun. 30, 2017	295,601,634
Sale of common stock	$ 8,796	20,870		29,666
Sale of common stock, Shares	4,398,366
Net income (loss)			(852,875)	(852,875)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Sep. 30, 2017	$ 600,000	83,976,507	(100,269,515)	(15,693,008)
Shares, Outstanding, Ending Balance at Sep. 30, 2017	300,000,000
Value of warrants issued		12,983		12,983
Net income (loss)			(2,198,413)	(2,198,413)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Dec. 31, 2017	$ 600,000	83,989,490	(102,467,928)	(17,878,438)
Shares, Outstanding, Ending Balance at Dec. 31, 2017	300,000,000
Net income (loss)			364,208	364,208
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2018	$ 600,000	83,989,490	(102,103,720)	(17,514,230)
Shares, Outstanding, Ending Balance at Mar. 31, 2018	300,000,000
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Beginning Balance at Jun. 30, 2018	$ 600,000	84,113,690	(102,013,374)	(17,299,684)
Shares, Outstanding, Beginning Balance at Jun. 30, 2018	300,000,000
Change in loan shares evaluation		342,000		342,000
Net income (loss)			146,292	146,292
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Sep. 30, 2018	$ 600,000	84,455,690	(101,867,082)	(16,811,392)
Shares, Outstanding, Ending Balance at Sep. 30, 2018	300,000,000
Valuation change in loaned shares		(126,000)		(126,000)
Net income (loss)			(616,938)	(616,938)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Dec. 31, 2018	$ 600,000	84,329,690	(102,484,020)	(17,554,330)
Shares, Outstanding, Ending Balance at Dec. 31, 2018	300,000,000
Issuance of subscribed shares	$ 79,537	3,210,454		3,289,991
Issuance of subscribed shares, Shares	39,768,462
Issuance of shares sold	$ 6,867	251,133		258,000
Issuance of shares sold, shares	3,433,333
Consulting shares issued	$ 2,358	112,055		114,413
Consulting shares issued, shares	1,179,134
Reissuance of shares loaned by related party	$ 36,000	1,854,000		1,890,000
Reissuance of shares loaned by related party, shares	18,000,000
Valuation change in loaned shares		(340,200)		(340,200)
Warrants issued		1,497,985		1,497,985
Net income (loss)			(2,218,144)	(2,218,144)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance at Mar. 31, 2019	$ 724,762	$ 90,915,117	$ (104,702,164)	$ (13,062,285)
Shares, Outstanding, Ending Balance at Mar. 31, 2019	362,380,929

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Mar. 31, 2019	Mar. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (2,688,790)	$ (2,687,080)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Stock-based compensation	132,213	196,000
Costs associated issued warrants	1,497,985	12,983
Non-cash interest on mandatory redemption shares by related party	127,800	397,800
Gain on debt extinguishment	(112,625)	0
Non-cash financing costs - commodity supply agreements	166,725	302,664
Net change in operating assets and liabilities:
Prepaid expenses and other current assets	(2,008)	(11,821)
Accounts payable and accrued liabilities	558,568	201,641
Net Cash Used in Operating Activities	(320,132)	(1,587,813)
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment on mineral property acquisition	(515,000)	(2,500,000)
Payments on mineral leases	(50,000)	(210,116)
Refund (deposit) in joint venture	25,000	(25,000)
Net cash used in investing activities	(540,000)	(2,735,116)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock purchases	758,000	895,933
Proceeds from exercise of warrants	0	895,933
Proceeds from stock subscriptions not issued	0	2,275,073
Loan proceeds from note payable	239,750	0
Loan proceeds from related parties	51,462	0
Payment on notes payable	(170,000)	(25,000)
Net Cash Provided by Financing Activities	879,212	4,041,939
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	19,080	(280,990)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	18,897	392,375
CASH AND CASH EQUIVALENTS, END OF PERIOD	37,977	111,385
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	0	0
Cash paid for income taxes	0	0
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common stock loaned and cancelled from related party	0	36,000
Reissuance of common stock loaned from related party	$ 1,890,000	$ 0

XML

NOTE 1 - COMPANY AND NATURE OF OPERATIONS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 1 - COMPANY AND NATURE OF OPERATIONS

NOTE 1 – COMPANY AND NATURE OF OPERATIONS

Santa Fe Gold Corporation, a Delaware corporation (the "Santa Fe”, "Company", “our” or “we”) is a U.S. copper, silver and gold exploration and mining company.

The accompanying unaudited financial statements and related notes present the Company’s consolidated financial position as of March 31, 2019 and June 30, 2018 (Audited), the consolidated results of operations for the three and nine months ended March 31, 2019 and 2018, and consolidated cash flows for the nine months ended March, 2019 and 2018. The unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended March 31, 2019, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2019. The accounting policies followed by the Company are set forth in Note 2 to the Company’s financial statements included in Form 10-K for the fiscal year ended June 30, 2019. These interim financial statements and notes thereto should be read in conjunction with the consolidated financial statements presented in the Company’s 2019 Annual Report on Form 10-K filed on July 15, 2020.

Nature of Operations

Santa Fe Gold Corporation 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.

Upon the Company emerging from the bankruptcy with a management team of two and 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.

On August 18, 2017, the Company signed the Bullard’s Peak Agreement and delivered $100,000 towards the purchase price. The Agreement is to purchase Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company and acquire 100% of the issued and outstanding capital stock for a cash purchase price in the aggregate amount of $3,000,000, and paid with installments stated in the Bullard’s Peak Agreement.

On January 4, 2019, the Company has entered into a purchase agreement with a mining operator to purchase two properties in western New Mexico, the Billali Mine and the Jim Crow Imperial Mine. 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.

XML

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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.

The Company has recorded a loss of $2,688,790 for the nine months ended March 31, 2019, and has a total accumulated deficit of $104,702,164 and a working capital deficit at March 31. 2019 of $16,337,401. The Company currently has no source of generating revenue.

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 acquired new mining claims 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.

At March 31, 2019, the Company was in defaults on payments of approximately $7.87 million under a gold stream agreement (the “Gold Stream Agreement”) with Sandstorm Gold Ltd. (“Sandstorm”), other notes payable principle aggregating approximating $2.38 million, accrued liabilities of approximately $2.94 million and accounts payable approximating $3.05 million.

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, and Santa Fe Gold Barbados Corporation, a Barbados corporation, Santa Fe Acquisitions Company, a New Mexico Limited Liability Company and Minerals Acquisitions, LLC, a New Mexico Limited Liability Company. All significant inter-company accounts and transactions have been eliminated in consolidation.

On July 19, 2016, a new company was formed, Santa Fe Acquisition LLC (“SFA”) with Tom Laws, our CEO, as the signer, for the sole purpose of acquiring assets for Santa Fe Gold (“SFG”). On September 25, 2017, with an effective date of July 23, 2016, the CEO assigned ownership of SFA to Santa Fe Gold whereby SFG became to sole member of SFA resulting in SFA becoming a wholly owned subsidiary of SFG.  All major purchases were made through the SFA Company for the benefit of SFG, with the funding provided by SFG.

Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 period. 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, fixed assets, depreciation and amortization, accruals, derivative instrument liabilities, taxes and contingencies, and stock-based compensation which are discussed in the respective notes to the consolidated financial statements.

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts payable and accrued liabilities approximated their related fair values as of March 31, 2019 and June 30, 2017, due to the relatively short-term nature of these instruments. The carrying value of the Company's convertible notes payable approximates the fair value based on the terms at which the Company could obtain similar financing and the short-term nature 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.

Derivative Financial Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. 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 the 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.

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.

The Company has no financial derivative instruments in the current reporting periods.

Net Income (Loss) Per Share

Basic earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings per share are calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During the periods when they are anti-dilutive, common stock equivalents, if any, are not considered in the computation. For the three months ended March 31, 2019 and the nine months ended March 31, 2019 and 2018, the impact of outstanding stock equivalents has not been included as they would be anti-dilutive.

A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation is as follows:  

	Net Income (Numerator)		Weighted Average Common Shares (Denominator)		Per Share Amount
For the three months ended March 31, 2018
Basic EPS
Income available to common stockholders		$          364,208		300,000,000	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		75,000
Income available to common stockholders plus assumed conversions		$         364,208		300,075,000	$	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 vest over a period of six months to a year.

The Company accounts for share-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. Share based payments to nonemployees are valued at the earlier or a commitment date or completion of services. The Company had stock-based compensation of $132,213 for the nine months ending March 31, 2019, and $196,000 for the nine months ended March 31, 2018.

Accounting Standards to be Adopted in Future Periods

In May 2014, the FASB issued ASC updated No. 2014-09, Revenue from Contracts with Customers (Topic 606 (ASU 2014-09). Under the amendments in this update, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in this update are effective for fiscal years and interim periods within those years beginning after December 15, 2017. The new standard is required to be applied either retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of applying the update recognized at the date of initial application. The new standard was adopted by the Company the quarter ended September 30,2018, and will not have an impact on our consolidated financial statements until revenue is achieved.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.  This ASU is effective for annual periods beginning after December 15, 2017 and interim periods within fiscal years. ASU No 2016-15 addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The Company adopted this standard effective July 1, 2018 and it will not have a material impact on the Company’s financial position or results of operations.

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 has not adopted Topic 842 as of the filing of this 10-Q and at this time the new standard will not have an impact on our consolidated financial statements until significant a lease agreement is entered.

In November 2016, the FASB has issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), which provides guidance on how restricted cash or restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This amendment is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The new standard was adopted by the Company in the quarter ended September 30, 2018, and will not have a significant impact on our consolidated financial statements

In May 2017, FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which amends the scope of modification accounting surrounding share-based payment arrangements as issued in ASU 2016-09 by providing guidance on the various types of changes which would trigger modification accounting for share-based payment awards. ASU 2017-09 is effective for annual periods beginning after December 15, 2017. The new standard was adopted by the Company in the quarter ended September 30, 2018, and the Company does not expect the adoption of ASU 2017-09 to have a material effect on its business or on its financial position, results of operations or cash flows.

In August 2018, ASU No. 2018-13 was issued to modify and enhance the disclosure requirements for fair value measurements. This update is effective in fiscal years, including interim periods, beginning after December 1, 2020, and early adoption is permitted.  The Company is currently evaluating this guidance and the impact on its Consolidated Financial Statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, 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.

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NOTE 3 - DEPOSIT ON MINERAL PROPERTY

9 Months Ended

Mar. 31, 2019

Notes to Financial Statements

NOTE 3 - DEPOSIT ON MINERAL PROPERTY

Note 3 – DEPOSIT ON MINERAL PROPERTY

Acquisition of Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company

On August 18, 2017, the Company signed the Bullard’s Peak Agreement and delivered $100,000 towards the purchase price. The Agreement is to purchase Bullard’s Peak Corporation and Black Hawk Consolidated Mines Company and acquire 100% of the issued and outstanding capital stock for an initial cash purchase price of $3,000,000, to be paid with installments stated in the Bullard’s Peak Agreement. Title to the claims and capital stock will be transferred upon receipt by seller of the full purchase price. Additional installments were made as follows through the end of the current reporting period towards the purchase price:

- August 30, 2017, the Company delivered $900,000;

- September 8, 2017, the Company delivered $500,000;

- October 13, 2017, the Company delivered $500,000;

- January 2, 2018, the Company delivered $500,000;

- October 15, 2018, the Company delivered $100,000;

- October 31, 2018, the Company delivered $100,000;

- November 30, 2018, the Company delivered $100,000

- January 2 2019, the Company delivered $65,000

- February 1, 2019, the Company delivered $50,000

- February 28, 2019 Company delivered $100,000

Purchase of four placer claims in British Columbia, Canada

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 remained in trust with the sellers until payment in full.  To date, the Company has paid to the sellers’ consideration of US$210,116. The Company disclosed in a Form 8-K filing on November 20, 2018 that it had been notified that it was in default with respect to these two November 2017 agreements and that the sellers threatened legal action. The Company has engaged British Columbia counsel to review the two November 2017 agreements and has concluded that there were false representations made by the sellers and that certain conditions precedent of sellers were not satisfied. As a result, the Company’s position is that these two November 2017 agreements are not and were never binding and have requested sellers to refund the US$210,116. The Company so informed sellers on March 4, 2019. The Company continues to evaluate its rights and remedies in connection with this matter. As a result, the Company does not own any rights to the four placer claims located in the Vernon mining district of British Columbia, Canada (which property is more fully set forth in the Form 8-K filing dated November 20, 2018).

Billali Mine and the Jim Crow Imperial Mine Mineral Interest

In January 2019 the Company has acquired rights to 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 Company entered into a purchase agreement with a mining operator in January 2019 to purchase two properties in western New Mexico, the Billali Mine, and the Jim Crow Imperial Mine. 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, with aggregate consideration for both definitive agreements payable as follows per Amendment Three that is effective as of May 1, 2020:

* $500,000 paid to date as of the filing date;

* buyer to pay $50,000 monthly commencing July 1, 2020, and continuing for the next subsequent 19 months;

* commencing 30 days after the last payment above, and continuing for the for an additional 48 subsequent payments, buyer to make each 30 days a payment in the amount of $175,000;

* after the final payment above and 30 days thereafter, the buyer will make the final payment of $100,000 completing the purchase.

* 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.

The Agreement has a 5% net smelter return (NSR) royalty on the nine patented Lode Claims with a royalty limit up to $650,000, and a 3% NSR thereafter.

Title and all rights and interest in the properties will be conveyed under the agreements upon completion of the payments of the purchase prices of the properties.

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NOTE 4 - ACCRUED LIABILITIES

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 4 - ACCRUED LIABILITIES

Note 4 – ACCRUED LIABILITIES

Accrued liabilities consist of the following at March 31, 2019 and June 30, 2018:

		March 31,		June 30,
		2019		2018
Interest	$	3,421,988	$	3,031,677
Vacation		15,770		15,770
Payroll		124,622		134,718
Franchise taxes		8,697		8,697
Merger costs, net		269,986		269,986
Other		19,579		19,579
Audit		18,557		18,557
Commodity supply agreement		3,321,148		3,154,423
Property taxes		253,523		253,523
	$	7,453,870	$	6,906,930

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NOTE 5 - COMPLETION GUARANTEE PAYABLE

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 5 - COMPLETION GUARANTEE PAYABLE

Note 5 – 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 9- 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 uncredited liability totaled $3,359,873 at March 31, 2019 and June 30, 2018, respectively, and are reported as completion guarantee payable. Accrued interest on the completion guarantee payable at March 31, 2019 and June 30, 2018 was $1,190,652 and $1,058,357, respectively. Interest expense on the obligation for the nine months ended March 31, 2019 and 2018 was $132,295, respectively.

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NOTE 6 - SHARES SUBJECT TO MANDATORY REDEMPTION BY RELATED PARTY

9 Months Ended

Mar. 31, 2019

Notes to Financial Statements

NOTE 6- SHARES SUBJECT TO MANDATORY REDEMPTION BY RELATED PARTY

NOTE 6 - 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 has 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 will be 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 March 31, 2019 and June 30, 2018 was $0 and $1,638,000, respectively.

The shares were returned to the related party on January 23, 2019. The valuation of the shares on the return date was $1,890,000 and resulted in an interest charge of $127,800 and a credit to Additional Paid in Capital of $340,200 in the three months ended March 31, 2019.

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NOTE 7 - NOTES PAYABLE

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 7 - NOTES PAYABLE

NOTE 7 – NOTES PAYABLE

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 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.

A forbearance agreement by and among Santa Fe and Canarc Resource Corp. (“Canarc”) was entered into and effective as of February 12, 2018. Canarc loaned/advanced Santa Fe $220,000 in 2014. The funding requirements were not attained and the loan became due on January 15, 2015. 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 accrued interest on the note payable and note principle 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.

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%, with the equipment securing the loan. The balance owed on the note was $398,793 at March 31, 2019 and June 30, 2018 and had an accrued interest of $104,885 and $87,687, respectively. Interest expense on the note for the nine months ended March 31, 2019 and 2018 was $17,198 and $17,197, respectively. In December 2016 the court administered trust paid $17,412 to the note holder and was applied against the accrued interest on the note 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, currently is due and in default and the equipment has been returned to the vendor for sale and remains unsold at March 31, 2019.

During the nine months ended March 31, 2019, an individual loaned the Company $239,750 for working capital purposes. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender. Interest expense for the six months was $4,226 and accrued interest on the loan at March 31, 2019 is $4,226.

In conjunction with the Merger Agreement, Tyhee and the Company entered into a Bridge Loan Agreement, 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 only $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 Agreement and Tyhee’s allocation of the proceeds from the Bridge Loan Agreement. At June 30, 2014, the Company recorded merger expenses that are due to Tyhee of $269,986 and is included in accrued liabilities at March 31, 2019 and June 30, 2018. This amount is net of a break fee of $300,000 due to the Company from Tyhee. Accrued interest on note at March 31, 2019 and June 30, 2018, was $2,050,916 and $1,736,513, respectively, is due and in default. Interest expense on the note for the nine months ended March 31, 2019 and 2018 was $314,403 and $323,516, respectively.

The following summarizes notes payable:		March 31,		June 30,
		2019		2018
Working capital advances, interest at 1% per month, due January 15, 2015	$	—	$	162,522
Merger advance		—		20,000
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
Note payable		239,750		—
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 - current	$	2,383,635	$	2,326,407

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NOTE 8 - FAIR VALUE MEASUREMENTS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 8 - FAIR VALUE MEASUREMENTS

NOTE 8 – FAIR VALUE MEASUREMENTS

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.

The Company’s financial instruments consist of derivative instruments which are measured at fair value on a recurring basis. The derivatives are measured on their respective origination dates, at the end of each reporting period and at other points in time when necessary, such as modifications, using Level 3 inputs in accordance with GAAP. The Company does not report any financial assets or liabilities that it measures using Level 1 or 2 inputs. The fair value measurement of financial instruments and other assets as of March 31, 2019 and June 30, 2018 are as follows:

March 31, 2019
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	—	$	—

June 30, 2018
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	1,638,000	$	1,638,000

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NOTE 9 - CONTINGENCIES AND COMMITMENTS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 9 - CONTINGENCIES AND COMMITMENTS

NOTE 9 – 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 continue 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 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 uncredited balance of the original $4,000,000 upfront deposit. See NOTE 5 - COMPLETION GUARANTY 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, 2019 and June 30, 2018, of 3,709 ounces of undelivered gold valued at approximately $3.32 and $3.15 million, respectively, in accrued liabilities 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.

Office and Real Property Leases

On August 1, 2015, the Company moved the office to a single room located in Albuquerque, NM, at the home of the CFO for a monthly rent of $500 until the Company is required to lease increased office space due to additional personnel requirements. Rental expense totaled $4,500 for the nine months ended March 31, 2019 and 2018, 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.

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NOTE 10 - STOCKHOLDERS' DEFICIT

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 10 - STOCKHOLDERS' DEFICIT

NOTE 10- STOCKHOLDERS' DEFICIT

Stock Returned, Cancelled and Reissued

On July 28, 2017, a shareholder returned a certificate for 20,000,000 common shares to the Company for no value received by the shareholder and the investor was issued 2,000,000 shares on a new certificate. The net 18,000,000 cancelled shares are to be re-issued at a later time and the obligation will be accounted for as a derivative liability at the fair value of the shares and marked to market at each balance sheet date. The net 18,000,000 shares returned were recorded at Par Value of $36,000.The shares were returned to the related party on January 23, 2019. The valuation of the shares on the return date was $1,890,000 and resulted in an interest charge of $127,800 and a credit to Additional Paid in Capital of $340,200 in the three months ended March 31, 2019.

Increased Authorization of Common Shares

At the shareholders meeting held on January 11, 2019, in Albuquerque, New Mexico, and a majority of our shareholders voted to amend our certificate of incorporation to increase the authorized shares of common stock that we have authority to issue from 300,000,000 shares to 550,000,000 shares.

Issuance of Stock

Subscribed Capital and Share Issuance

Effective January 12, 2019, subscribed shares received or consultant shares granted prior to January 12, 2019, aggregating 39,768,462 shares of restricted common stock, were issued to the shareholders at purchase price of the shares and shares granted to consultants were issued at their value on the date of grants at a total value of $3,289,991.

During the three months ended March 31, 2019, the Company sold 3,433,333 shares of restricted common stock for aggregate cash proceeds of $258,000.

During the three months ended March 31, 2019, the Company granted issuance of 1,179,134 shares of restricted common stock for consulting services for an aggregate value of $114,413 on the date of grants.

During the three months ended March 31, 2019, the Company reissued the 18,000,000 loaned shares from a related party at a market value on the date of issuance of $1,890,000.

The issuance of the restricted common shares during nine months ended March 31, 2019, were exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) and/ or Regulation S promulgated thereunder and thereof such issuance did not involve a public offering.

Issuance of Warrants and Expiration

During the nine months ended March 31, 2019, the Company issued no new warrants and 3,240,000 warrants expired.

Stock Options

During nine months ended March 31, 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 nine-month period 100,000 options expired.

Stock option and warrant activity, for the nine months ended March 31, 2019, are as follows:

	Stock Options		Stock Warrants
		Weighted		Weighted
		Average		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	—	—
Canceled	—	—	—	—
Expired	(100,000)	$0.08	(3,240,000)	$0.15
Exercised	—	—	—	—
Outstanding at December 31, 2018	30,100,000	$0.05	1,180,000	$0.15

Stock options and warrants outstanding and exercisable at March 31, 2019 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	4.98	$	0.05	$	0.15	1,180,000	1,180,000	.34	$	0.15
$0.07	100,000	100,000	.76	$	0.07
	200,000	200,000						4,420,000	4,420,000
	Outstanding Options		4.96	$	0.05		Outstanding Warrants			.34	$	0.15
	Exercisable Options		4.96	$	0.05		Exercisable Warrants			.34	$	0.15

As of March 31, 2019, the aggregate intrinsic value of all stock options and warrants vested was $150,000. The intrinsic value of each 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 $0.055 closing stock price of the common stock on March 31, 2019.

The total intrinsic value associated with options exercised during the nine months ended March 31, 2019, 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.

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NOTE 11 - RELATED PARTY TRANSACTIONS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 11 - RELATED PARTY TRANSACTIONS

NOTE 11 – RELATED PARTY TRANSACTIONS

In order to expedite purchases of equipment and associated expenses in Silver City on behalf of the Company, SFG deposited funds into Mr. Laws certified public accounting practice account until a new bank account was opened at Wells Fargo. Company expenses and purchases of equipment were done in that account. During the fiscal year 2017 an aggregate of $926,000 was deposited to Mr. Laws account or was paid out of the corporate account at Mr. Law’s direction. At the end of the 2017 fiscal year Mr. Laws submitted expenditures on behalf of the Company totaling $1,009,099. Subsequent to the 2017 fiscal year ended, the board directors of the Company appointed a special committee which determined the funds expended by Mr. Laws were misappropriated in the amount of $971,099 and a deposit of $38,000 was valid and refunded to the Company in a subsequent period. Of this amount, the $500,000 deposit that was to be made on the Alhambra Acquisition was subsequently determined never made the sellers. See NOTE 13 - Subsequent Events, Misappropriated Funds and Entry into a Material Definitive Agreement.

Prior to becoming a staff member of the Company, Mr. Laws our CEO, received a consulting fee and converted on January 1, 2018, to a full staff member.

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 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.

The board of directors formed a special committee on September 26, 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 Mr. Laws. The special committee investigation determined initially that Mr. Laws owes the Company $1,197,198, excluding penalty, accrued interest and additional associated costs. At the time of filing this Form 10-Q total costs associated with Mr. Laws is $1,651,263, including the additional incurred associated costs, of which $485,966 has been recovered by the Company from Mr. Laws. The Company does not anticipate collecting a material amount due from Mr. Laws and will be determined by the bankruptcy court.

The Company is in process of restating the previously issued consolidated financial statements for, and financial information relating to, the fiscal year ended June 30, 2017.

Subsequent review of these transactions for the fiscal year ended June 30, 2017, resulted in a restatement of assets and operating costs in the amount of $971,099 and charged to the former chief executive officer.

Mr. Laws was terminated as the at-will chief executive officer of the Company on September 24, 2018. Currently no interim chief executive officer has been named to replace Mr. Laws.  

In November 2018, Santa Fe filed a complaint in Luna County District Court, State of New Mexico, requesting a $930,000 money judgment against Mr. and Mrs. Laws, in addition to foreclosing on the mortgage Mr. and Ms. Laws granted to Santa Fe on real property to secure the promissory note located in Luna County, New Mexico. 

In November 2018, Santa Fe filed a similar complaint in Grant County District Court, State of New Mexico, as Mr. and Mrs. Laws and XYZ Ranch Estates, LLC granted Santa Fe a deed of trust and a mortgage, respectively, on several pieces of real property in Grant County, New Mexico. Mr. Laws also granted Santa Fe a security agreement on an airplane located in Grant County, New Mexico.  The complaint in Grant County requested a money judgment in the amount of $930,000 against Mr. and Mrs. Laws, in addition to a request to foreclose on the assets pledged to us located in Grant County, New Mexico. 

As of the filing of this report, Mr. Laws has pleaded guilty to various charges brought against him by government officials, which include the Company allegations. Mr. Laws is currently awaiting sentencing on the pleaded to charges. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court.

On August 9, 2017, a related party shareholder returned a certificate for 20,000,000 common shares to the Company for no value received by the shareholder and the investor was issued 2,000,000 shares on a new certificate. The net 18,000,000 cancelled shares are to be re-issued at a later time and the obligation will be accounted for under ASC 480, “Distinguishing Liabilities from Equity” at the fair market value of the shares and marked to market at each balance sheet date. On April 4, 2018, the investor became a director of the Company. See NOTE 6 – share obligation to related party for additional disclosures. On January 23, 2019, the loaned shares were reissued to the related party.

An individual consultant, who is instrumentally helpful to the Company in raising funds and is compensated on consulting basis, as disclosed in NOTE 13 – SUBSEQUENT EVENTS, Recent Issuances of Unregistered Securities. During the three months ended September 30, 2018, received the final finder’s fees totaling $20,000 on August 14, 2018.

During the quarter ended December 2018 and March 2019, our chief financial officer the Company loaned the Company $51,462 for working capital purposes. The loan is at an annual interest rate of 6%, has no stated due date and is payable on demand by the lender. Interest expense for the nine months ended March 31, 2019, is $762, and accrued interest at March 31, 2019 is $762.

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.

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NOTE 12 - LEGAL PROCEEDINGS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 12 - LEGAL PROCEEDINGS

NOTE 12 – LEGAL PROCEEDINGS

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

Boart Long year 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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $13,860 and recorded $21,454 in legal fees awarded in the judgement. In December 2016 the court administered trust paid $6,287 to Bogart Longyear and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31,2019 and 2018, the Company accrued interest on the obligation of $4,194, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $26,264 and $20,019, respectively. Interest expense on the obligation for the nine months ended March 31,2019 and 2018 was $6,245 and $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. The Company accrued back interest on judgement during the quarter ended December 31, 2016, of $26,875. In December 2016 the court administered trust paid $4,591 to Wagner equipment and was applied against the accrued interest on the obligation and was recorded as a gain on trust debt forgiveness. During the nine months ended March 31, 2019 and 2018, the Company interest expense on the obligation was $7,605, respectively. Accrued interest on the obligation at March 31, 2019 and June 30, 2018 was $45,045 and $37,440, 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.

The Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) have each initiated investigation into the Company and certain other individuals, resulting from the Laws transactions and related misappropriation of funds described herein. The SEC has obtained a formal order to investigate the Company. The DOJ investigation is still preliminary. These types of investigations are expensive, time-consuming for management, and unpredictable – often resulting in other aspects of the Company’s operations becoming subject to regulatory scrutiny. These investigations are ongoing and no prediction can be made regarding the timing or outcome of such matters including remedial action pursued against the Company and others, including its officers and directors.

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.

We are subject from time to time to litigation, claims and suits arising in the ordinary course of business. Other than the above-described litigation, as of December 31, 2018, we were not a party to any material litigation, claim or suit whose outcome could have a material effect on our financial statements.

Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of its financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company discloses the nature of the loss contingencies, together with an estimate of the range of possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain unresolved proceedings are not presently determinable, and an estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be reasonably made, an adverse outcome from such proceedings could have a material adverse effect on its financial statements in any given reporting period. However, in the opinion of Management, after consulting with legal counsel, the ultimate liability related to the current outstanding litigation is not expected to have a material adverse effect on its financial statements.

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NOTE 13 - SUBSEQUENT EVENTS

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

NOTE 13 - SUBSEQUENT EVENTS

NOTE 13 – SUBSEQUENT EVENTS

Recent Issuances of Unregistered Securities

In the period from April 2019 through August 14, 2020, the Company sold an aggregate of 46,775,910 restricted common shares to ten existing accredited shareholders and two new accredited investors and the Company received aggregate proceeds of $2,893,980 from these sales. In addition, our chairman purchased 7,892,858 restricted common shares for $475,000. The issuance of the restricted common shares, were exempt from registration requirements of the Security Act of 1933, as amended, pursuant to Section 4(a)2, thereof because such issuance did not involve a public offering. In connection with the placements, the Company incurred no consulting fees.

During the period April 2019 through August 14, 2020, the Company issued restricted 2,656,884 shares of common stock for consulting services at an aggregated market value of $237,381 on the date of issuance. The issuance of the restricted common shares, were exempt from registration requirements of the Security Act of 1933, as amended, pursuant to Section 4(a)2, thereof because such issuance did not involve a public offering.

In the period from April 1, 2019 through August 14, 2020, the Company issued warrants to accredited investors aggregating 4,500,000, and 2,250,000 warrants to the chairman of the board that were attached to restricted stock purchases. The warrants were vested at issuance, have a three-year life and an exercise price of $0.05 and $0.07 per share.

On April 10, 2020, the Company converted $100,000 of accrued salary for the Company CFO into 2,000,000 shares of restricted common stock at a market value of $117,000 on the date on grant and recorded a loss on debt conversion of $17,000. Warrants issued in conjunction with the conversion were 1,000,000 vested three-year warrants and have an exercise price of $0.05 per share.

On June 30, 2020, the Company converted a note payable with the Company CFO consisting of principal and interest of $42,036 and $6,178, respectively, into 964,299 shares of restricted common stock at $0.05 per share. The market value on the date of conversion was $67,501 and on the date of conversion the Company recorded a loss on debt conversion of $19,287. In conjunction with the conversion 482,149 vested three-year warrants were granted and have an exercise price of $0.05 per share.

Alhambra Acquisition

Pursuant to a stock purchase agreement dated August 2017, the Company will acquire all the capital stock of Bullard’s Peak Corporation (which owns five patented claims and 82 unpatented claims in the Black Hawk district of New Mexico) from Black Hawk Consolidated Mines Company for a purchase price of $3,000,000, and the capital stock of Bullard’s Peak Corporation and the mining claims collateralize the full purchase price payment. The Company granted the seller a 2% net smelter return in perpetuity.  The net smelter return is 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. Title to the claims will be transferred upon receipt by seller of the full purchase price. In August 2018, the Company was informed that the seller terminated the stock purchase agreement. Pursuant to an amendment to the stock purchase agreement in October 2018, the Company paid the seller $100,000 and the seller rescinded the August 2018 election to terminate the stock purchase agreement and waived all then existing events of default and any additional interest, late fees, and other damage claims due to the Company’s prior breaches of the stock purchase agreement. On October 31, 2018, the Company paid the seller an additional $100,000. The balance of the purchase price of $350,365 (which includes $50,365 of expenses that the Company agreed to reimburse seller) is required to be paid: (i) $100,000 on or before November 30, 2018 and (ii) $250,365 on or before December 31, 2018. If any payment is not timely paid, all rights of the Company under the stock purchase agreement shall become automatically null and void and seller shall retain all monies paid as liquidated damages for the Company’s breach, and seller shall have no further obligations to the Company, including but not limited to, any obligation to transfer the capital stock of Bullard’s Peak Corporation to the Company pursuant to the terms of the stock purchase agreement. We paid $100,000 in November 2018 with respect to the Alhambra Silver Mine acquisition and owed a balance of approximately $250,000 on December 31, 2018, to complete the acquisition. Lack of funding on December 31, 2018 resulted in us entering into a third amendment pursuant to which we paid $65,000 on January 2, 2019, a late fee payment on February 1, 2019 of $50,000, a $100,000 on February 28, 2019, and the final payment of $100,365 was paid on April 2, 2019, for the total cost of $3,115,365.

In February 2018, the Company filed for a permit to start operations at the Bullard’s Peak property. The permit was awarded on March 7, 2018. As of the filing of this report, no operations have commenced.

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 Company common stock.  Title to these claims remained in trust with the sellers until payment in full.  To date, the Company has paid to the sellers’ consideration of Can$260,000. The Company disclosed in a Form 8-K filing on November 20, 2018 that it had been notified that it was in default with respect to these two November 2017 agreements and that the sellers threatened legal action. The Company has engaged British Columbia counsel to review the two November 2017 agreements and has concluded that there were false representations made by the sellers and that certain conditions precedent of sellers were not satisfied. As a result, the Company’s position is that these two November 2017 agreements are not and were never binding and have requested sellers to refund the Can$260,000. The Company so informed sellers on March 4, 2019. The Company continues to evaluate its rights and remedies in connection with this matter. As a result, the Company does not own any rights to the four placer claims located in the Vernon mining district of British Columbia, Canada (which property is more fully set forth in the Form 8-K filing dated November 20, 2018). At the time of the filing of this report the agreements are being scheduled for arbitration by the Company attorney. At June 30, 2019, the Company impaired the investment in the amount of $210,116.

Misappropriation of Funds and Entry into a Material Definitive Agreement

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 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.

The board of directors formed a special committee on September 26, 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 Mr. Laws. The special committee investigation determined initially that Mr. Laws owes the Company $1,197,198, excluding penalty, accrued interest and additional associated costs. At the time of filing this Form 10-Q total costs associated with Mr. Laws is $1,651,263 of which $485,966 has been recovered by the Company. The Company does not anticipate collecting a material amount due from Mr. Laws and will be determined by the bankruptcy court

The Company is in process of restating the previously issued consolidated financial statements for, and financial information relating to, the fiscal year ended June 30, 2017.

Subsequent review of these transactions for the fiscal year ended June 30, 2017, resulted in a restatement of assets and operating costs in the amount of $971,099 and charged to the former chief executive officer.

Mr. Laws was terminated as the at-will chief executive officer of the Company on September 24, 2018. Currently no interim chief executive officer has been named to replace Mr. Laws.  

In November 2018, Santa Fe filed a complaint in Luna County District Court, State of New Mexico, requesting a $930,000 money judgment against Mr. and Mrs. Laws, in addition to foreclosing on the mortgage Mr. and Ms. Laws granted to Santa Fe on real property to secure the promissory note located in Luna County, New Mexico. 

In November 2018, Santa Fe filed a similar complaint in Grant County District Court, State of New Mexico, as Mr. and Mrs. Laws and XYZ Ranch Estates, LLC granted Santa Fe a deed of trust and a mortgage, respectively, on several pieces of real property in Grant County, New Mexico. Mr. Laws also granted Santa Fe a security agreement on an airplane located in Grant County, New Mexico.  The complaint in Grant County requested a money judgment in the amount of $930,000 against Mr. and Mrs. Laws, in addition to a request to foreclose on the assets pledged to us located in Grant County, New Mexico. 

As of the filing of this report, Mr. Laws has pleaded guilty to various charges brought against him by government officials, which include the Company allegations. Mr. Laws is currently awaiting sentencing on the pleaded to charges. The Company attorneys have filed all required documents for future monetary settlements to be determined by the court.

Extinguishment of Debt

Based upon a legal opinion from our British Columbia legal consul, the Company at June 30, 2019, wrote off of two financing facilities under British Columbia law where the statute of limitations had run out pursuant to the Limitations Act (British Columbia) and that no future claims can be commenced in the Providence of British Columbia and the Company has no outstanding legal obligation on the finance facilities. The Company also paid off a negotiated settlement under a Forbearance Agreement during our fiscal year ended June 30, 2019, and wrote off the remaining obligation balance.

Merger Agreement, loan balance	$ 1,745,092
Merger Agreement, loan accrued interest	2,155,335
Merger Agreement accrued fees	269,986
Goldstream loan balance	3,742,505
Completion Guaranty accrued interest	1,234,749
Completion Guaranty Payable	3,359,873
Forbearance Agreement	112,625
Total Debt Extinguishment	$ 12,620,165

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NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Mar. 31, 2019

Policy Text Block [Abstract]

Basis of Presentation and Going Concern

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.

The Company has recorded a loss of $2,688,790 for the nine months ended March 31, 2019, and has a total accumulated deficit of $104,702,164 and a working capital deficit at March 31. 2019 of $16,337,401. The Company currently has no source of generating revenue.

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 acquired new mining claims 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.

At March 31, 2019, the Company was in defaults on payments of approximately $7.87 million under a gold stream agreement (the “Gold Stream Agreement”) with Sandstorm Gold Ltd. (“Sandstorm”), other notes payable principle aggregating approximating $2.38 million, accrued liabilities of approximately $2.94 million and accounts payable approximating $3.05 million.

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries AZCO Mica, Inc., a Delaware corporation, The Lordsburg Mining Company, a New Mexico corporation, and Santa Fe Gold Barbados Corporation, a Barbados corporation, Santa Fe Acquisitions Company, a New Mexico Limited Liability Company and Minerals Acquisitions, LLC, a New Mexico Limited Liability Company. All significant inter-company accounts and transactions have been eliminated in consolidation.

On July 19, 2016, a new company was formed, Santa Fe Acquisition LLC (“SFA”) with Tom Laws, our CEO, as the signer, for the sole purpose of acquiring assets for Santa Fe Gold (“SFG”). On September 25, 2017, with an effective date of July 23, 2016, the CEO assigned ownership of SFA to Santa Fe Gold whereby SFG became to sole member of SFA resulting in SFA becoming a wholly owned subsidiary of SFG.  All major purchases were made through the SFA Company for the benefit of SFG, with the funding provided by SFG.

Estimates

Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America 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 period. 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, fixed assets, depreciation and amortization, accruals, derivative instrument liabilities, taxes and contingencies, and stock-based compensation which are discussed in the respective notes to the consolidated financial statements.

Fair Value of Financial Instruments

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts payable and accrued liabilities approximated their related fair values as of March 31, 2019 and June 30, 2017, due to the relatively short-term nature of these instruments. The carrying value of the Company's convertible notes payable approximates the fair value based on the terms at which the Company could obtain similar financing and the short-term nature of these instruments.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all liquid investments purchased with an initial maturity of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash balances.

Derivative Financial Instruments

Derivative Financial Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. 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 the 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.

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.

The Company has no financial derivative instruments in the current reporting periods.

Net Income (Loss) Per Share

Net Income (Loss) Per Share

Basic earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings per share are calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During the periods when they are anti-dilutive, common stock equivalents, if any, are not considered in the computation. For the three months ended March 31, 2019 and the nine months ended March 31, 2019 and 2018, the impact of outstanding stock equivalents has not been included as they would be anti-dilutive.

A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation is as follows:  

	Net Income (Numerator)		Weighted Average Common Shares (Denominator)		Per Share Amount
For the three months ended March 31, 2018
Basic EPS
Income available to common stockholders		$          364,208		300,000,000	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		75,000
Income available to common stockholders plus assumed conversions		$         364,208		300,075,000	$	0.00

Stock-Based Compensation

Stock-Based Compensation

In connection with terms of employment with the Company’s executives and employees, the Company occasionally issues options to acquire its common stock. Awards are made at the discretion of the Board of Directors. Such options may be exercisable at varying exercise prices and generally vest over a period of six months to a year.

The Company accounts for share-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. Share based payments to nonemployees are valued at the earlier or a commitment date or completion of services. The Company had stock-based compensation of $132,213 for the nine months ending March 31, 2019, and $196,000 for the nine months ended March 31, 2018.

Accounting Standards to be Adopted in Future Periods

Accounting Standards to be Adopted in Future Periods

In May 2014, the FASB issued ASC updated No. 2014-09, Revenue from Contracts with Customers (Topic 606 (ASU 2014-09). Under the amendments in this update, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in this update are effective for fiscal years and interim periods within those years beginning after December 15, 2017. The new standard is required to be applied either retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of applying the update recognized at the date of initial application. The new standard was adopted by the Company the quarter ended September 30,2018, and will not have an impact on our consolidated financial statements until revenue is achieved.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.  This ASU is effective for annual periods beginning after December 15, 2017 and interim periods within fiscal years. ASU No 2016-15 addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The Company adopted this standard effective July 1, 2018 and it will not have a material impact on the Company’s financial position or results of operations.

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 has not adopted Topic 842 as of the filing of this 10-Q and at this time the new standard will not have an impact on our consolidated financial statements until significant a lease agreement is entered.

In November 2016, the FASB has issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), which provides guidance on how restricted cash or restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This amendment is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The new standard was adopted by the Company in the quarter ended September 30, 2018, and will not have a significant impact on our consolidated financial statements

In May 2017, FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which amends the scope of modification accounting surrounding share-based payment arrangements as issued in ASU 2016-09 by providing guidance on the various types of changes which would trigger modification accounting for share-based payment awards. ASU 2017-09 is effective for annual periods beginning after December 15, 2017. The new standard was adopted by the Company in the quarter ended September 30, 2018, and the Company does not expect the adoption of ASU 2017-09 to have a material effect on its business or on its financial position, results of operations or cash flows.

In August 2018, ASU No. 2018-13 was issued to modify and enhance the disclosure requirements for fair value measurements. This update is effective in fiscal years, including interim periods, beginning after December 1, 2020, and early adoption is permitted.  The Company is currently evaluating this guidance and the impact on its Consolidated Financial Statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, 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.

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NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Table)

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

A reconciliation of the weighted average shares outstanding used in the basic and diluted earnings per share (“EPS”) computation is as follows:  

	Net Income (Numerator)		Weighted Average Common Shares (Denominator)		Per Share Amount
For the three months ended March 31, 2018
Basic EPS
Income available to common stockholders		$          364,208		300,000,000	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		75,000
Income available to common stockholders plus assumed conversions		$         364,208		300,075,000	$	0.00

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NOTE 4 - ACCRUED LIABILITIES (Tables)

9 Months Ended

Mar. 31, 2019

Table Text Block Supplement [Abstract]

Schedule Of Accrued Liabilities

Accrued liabilities consist of the following at March 31, 2019 and June 30, 2018:

		March 31,		June 30,
		2019		2018
Interest	$	3,421,988	$	3,031,677
Vacation		15,770		15,770
Payroll		124,622		134,718
Franchise taxes		8,697		8,697
Merger costs, net		269,986		269,986
Other		19,579		19,579
Audit		18,557		18,557
Commodity supply agreement		3,321,148		3,154,423
Property taxes		253,523		253,523
	$	7,453,870	$	6,906,930

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NOTE 7 - NOTES PAYABLE (Tables)

9 Months Ended

Mar. 31, 2019

Table Text Block Supplement [Abstract]

Schedule Of Debt

The following summarizes notes payable:		March 31,		June 30,
		2019		2018
Working capital advances, interest at 1% per month, due January 15, 2015	$	—	$	162,522
Merger advance		—		20,000
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
Note payable		239,750		—
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 - current	$	2,383,635	$	2,326,407

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NOTE 8 - FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Mar. 31, 2019

Table Text Block Supplement [Abstract]

Schedule Of Fair Value Assets And Liabilities

The Company does not report any financial assets or liabilities that it measures using Level 1 or 2 inputs. The fair value measurement of financial instruments and other assets as of March 31, 2019 and June 30, 2018 are as follows:

March 31, 2019
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	—	$	—

June 30, 2018
		Level 1		Level 2		Level 3		Total
Assets:
None	$	—	$	—	$	—	$	—
Liabilities:
Share redemption to related party	$	—	$	—	$	1,638,000	$	1,638,000

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NOTE 10 - STOCKHOLDERS' DEFICIT (Tables)

9 Months Ended

Mar. 31, 2019

Equity [Abstract]

Schedule Of Stock Options

Stock option and warrant activity, for the nine months ended March 31, 2019, are as follows:

	Stock Options		Stock Warrants
		Weighted		Weighted
		Average		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	—	—
Canceled	—	—	—	—
Expired	(100,000)	$0.08	(3,240,000)	$0.15
Exercised	—	—	—	—
Outstanding at December 31, 2018	30,100,000	$0.05	1,180,000	$0.15

Stock options and warrants outstanding and exercisable at March 31, 2019 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	4.98	$	0.05	$	0.15	1,180,000	1,180,000	.34	$	0.15
$0.07	100,000	100,000	.76	$	0.07
	200,000	200,000						4,420,000	4,420,000
	Outstanding Options		4.96	$	0.05		Outstanding Warrants			.34	$	0.15
	Exercisable Options		4.96	$	0.05		Exercisable Warrants			.34	$	0.15

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NOTE 13 - SUBSEQUENT EVENTS (Tables)

9 Months Ended

Mar. 31, 2019

Disclosure Text Block [Abstract]

Summary of gain on debt extinguishment

The Company also paid off a negotiated settlement under a Forbearance Agreement during our fiscal year ended June 30, 2019, and wrote off the remaining obligation balance.

Merger Agreement, loan balance	$ 1,745,092
Merger Agreement, loan accrued interest	2,155,335
Merger Agreement accrued fees	269,986
Goldstream loan balance	3,742,505
Completion Guaranty accrued interest	1,234,749
Completion Guaranty Payable	3,359,873
Forbearance Agreement	112,625
Total Debt Extinguishment	$ 12,620,165

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NOTE 1 - COMPANY AND NATURE OF OPERATIONS (Details) - USD ($)	Jan. 04, 2019	Aug. 17, 2017
Bullards Peak Agreement
Aggregate amount		$ 3,000,000
Aquisition percentage		100.00%
BillaliMine
Purchase price	$ 2,500,000
Jim Crow Imperial Mine
Purchase price	$ 7,500,000

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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basis of Presentation and Going Concern: Financial information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2018
Net loss	$ (2,218,144)	$ 364,208	$ (2,688,790)	$ (2,687,080)
Accumulated deficit	(104,702,164)		(104,702,164)		$ (102,013,374)
Working capital deficit	16,337,401		16,337,401
Accrued liabilities	7,453,870		7,453,870		6,906,930
Accounts payable	3,139,464		3,139,464		$ 3,061,976
Gold Stream Agreement
Defaults on payments			7,870,000
Other notes payable	2,380,000		2,380,000
Accrued liabilities	2,940,000		2,940,000
Accounts payable	$ 3,050,000		$ 3,050,000

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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES : Reconciliation of the weighted average shares outstanding (Details) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018
Net Income
Income available to common stockholders		$ 364,208
Dilutive shares from options and warrants		0
Income available to common stockholders plus assumed exercise of options and warrants		$ 364,208
Weighted Average Common Shares
Income available to common stockholders	350,212,711	300,000,000	316,493,226	297,821,540
Dilutive shares from options and warrants		75,000
Diluted	350,212,711	300,075,000	316,493,226	297,821,540
Basic and Diluted Per Share Data
Income available to common stockholders	$ .00	$ .00	$ (0.00)	$ (0.01)
Income available to common stockholders plus assumed exercise of options and warrants	$ 0.00	$ 0.00	$ (0.00)	$ (0.01)

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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Stock-Based Compensation (Details) - USD ($)	9 Months Ended
	Mar. 31, 2019	Mar. 30, 2018
Disclosure Text Block [Abstract]
Stock based compensation	$ 132,213	$ 196,000

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NOTE 3 - DEPOSIT ON MINERAL PROPERTY (Details) - USD ($)	9 Months Ended
	Mar. 31, 2019	Feb. 28, 2019	Feb. 01, 2019	Jan. 31, 2019	Jan. 02, 2019	Nov. 30, 2018	Oct. 31, 2018	Oct. 15, 2018	Jan. 02, 2018	Oct. 13, 2017	Sep. 08, 2017	Aug. 30, 2017	Aug. 18, 2017
Operating Lease, Payments	$ 210,116
Billali Mine
Total Purchase Price				$ 2,500,000
Jim Crow Imperial Mine
Total Purchase Price				$ 7,500,000
Bullard's Peak Corporation and Black Hawk Consolidated Mines Company
Installment Payment per terms of the Agreement		$ 100,000	$ 50,000		$ 65,000	$ 100,000	$ 100,000	$ 100,000	$ 500,000	$ 500,000	$ 500,000	$ 900,000	$ 100,000
Total Purchase Price													$ 3,000,000

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NOTE 4 - ACCRUED LIABILITIES: Schedule Of Accrued Liabilities (Details) - USD ($)	Mar. 31, 2019	Jun. 30, 2018
Text Block [Abstract]
Interest	$ 3,421,988	$ 3,031,677
Vacation	15,770	15,770
Payroll	124,622	134,718
Franchise taxes	8,697	8,697
Merger costs, net	269,986	269,986
Other	19,579	19,579
Audit	18,557	18,557
Commodity supply agreements	3,321,148	3,154,423
Property taxes	253,523	253,523
Accrued liabilities	$ 7,453,870	$ 6,906,930

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NOTE 5 - COMPLETION GUARANTEE PAYABLE (Details) - USD ($)	9 Months Ended
	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2018	Jun. 30, 2012
Interest	$ 132,295	$ 132,295
Accrued interest on obligation	1,190,652		$ 1,058,357
Completion guarantee payable
Total accrued liabilities	$ 3,359,873		$ 3,359,873	$ 504,049

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NOTE 6 - SHARES SUBJECT TO MANDATORY REDEMPTION BY RELATED PARTY (Details Narrative) - USD ($)		1 Months Ended		3 Months Ended		9 Months Ended
	Aug. 09, 2017	Jan. 23, 2019	Jul. 28, 2017	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2018
Notes to Financial Statements
Common stock returned	20,000,000		20,000,000
Common stock issued	2,000,000		2,000,000
Addition Paid in Capital	$ 1,762,200			$ 0		$ 0		$ 1,638,000
Increase in Additional Paid in Capital		$ 340,200		340,200
Value of shares returned		1,890,000
Interest expense		$ 127,800	$ 127,800	$ 161,583	$ 164,556	$ 491,177	$ 508,764

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NOTE 7 - NOTES PAYABLE (Details) - USD ($)				1 Months Ended					3 Months Ended			9 Months Ended
	Oct. 02, 2018	Jul. 15, 2014	Jun. 01, 2012	Dec. 31, 2018	Jun. 30, 2018	Feb. 14, 2018	Dec. 31, 2016	Jun. 30, 2014	Dec. 31, 2019	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 31, 2018	Mar. 30, 2018	Jun. 30, 2017
Interest expense										$ 762
Notes payable, current portion					$ 2,326,407					2,383,635		$ 2,383,635
Merger costs, net					269,986					269,986		269,986
Gain on debt extinguishment										0	$ 0	112,625		$ 0
Loan from related party									$ 51,462	51,462
Individual [Member]
Accrued interest										$ 4,226		4,226
Interest expense												$ 4,226
Debt Instrument, Interest Rate, Stated Percentage										6.00%		6.00%
Loan from related party												$ 239,750
Equipment
Debt Instrument, Face Amount			$ 593,657
Accrued interest					87,687					$ 104,885		104,885
Interest expense												17,198	$ 17,197
Debt Instrument, Interest Rate, Stated Percentage			5.75%
Debt Instrument, Term			48 months
Notes payable, current portion					398,793					398,793		398,793			$ 398,793
Court administered trust paid							$ 17,412
Canarc
Debt Instrument, Face Amount		$ 200,000
Proceeds from Other Short-term Debt		$ 20,000
Debt Instrument, Interest Rate, Stated Percentage		1.00%
Court administered trust paid							$ 9,897
Periodic payments	$ 85,000			$ 85,000	25,000	$ 25,000
Forgive of principal				12,522
Forgive of accrued interest				100,103
Gain on debt extinguishment				$ 112,625
Tyhee
Debt Instrument, Face Amount								$ 1,745,092
Accrued interest					1,736,513					2,050,916		2,050,916
Interest expense												314,403		$ 323,516
Debt Instrument, Interest Rate, Stated Percentage								24.00%
Merger costs, net					$ 269,986			$ 269,986		$ 269,986		$ 269,986
Break fee								$ 300,000

XML

NOTE 7 - NOTES PAYABLE: Schedule Of Debt (Details) - USD ($)	Mar. 31, 2019	Jun. 30, 2018
Notes payable, current portion	$ 2,383,635	$ 2,326,407
Notes Payables [Member]
Notes payable, current portion	0	162,522
Notes Payables 2[Member]
Notes payable, current portion	0	20,000
Notes Payable 3 [Member]
Notes payable, current portion	398,793	398,793
Notes Payable 4 [Member]
Notes payable, current portion	239,750	0
Notes Payables 5 [Member]
Notes payable, current portion	$ 1,745,092	$ 1,745,092

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NOTE 8 - FAIR VALUE MEASUREMENTS: Schedule Of Fair Value Assets And Liabilities (Details) - USD ($)	Mar. 31, 2019	Jun. 30, 2018
Derivative instruments liabilities {1}
Fair value, assets	$ 0	$ 0
Share redemption to related party	0	1,638,000
Level 1
Fair value, assets	0	0
Share redemption to related party	0	0
Level 2
Fair value, assets	0	0
Share redemption to related party	0	0
Level 3
Fair value, assets	0	0
Share redemption to related party	$ 0	$ 1,638,000

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NOTE 9 - CONTINGENCIES AND COMMITMENTS (Details) - USD ($)		1 Months Ended	9 Months Ended		12 Months Ended	121 Months Ended
	Aug. 09, 2017	Jul. 28, 2017	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2017	Dec. 31, 2019	Dec. 01, 2009
Operating Leases, Rent Expense			$ 4,500	$ 4,500
Common stock returned	20,000,000	20,000,000
Common stock issued	2,000,000	2,000,000
Office Lease
Debt Instrument, Periodic Payment			$ 500
Sandstorm
Customer Deposits, Current							$ 4,000,000
Loans and Leases Receivable, Gross, Consumer, Installment, Other							$ 400
Completion Guaranty Payable Terms						Gold production subject to the agreement includes 50% of the first 10,000 ounces of gold produced, and 22% of the gold thereafter.
Gold Stream Agreement					Company has a recorded obligation at March 31, 2019 and June 30, 2018, of 3,709 ounces of undelivered gold valued at approximately $3.32 and $3.15 million, respectively, in accrued liabilities net of the Fixed Price of $400 per ounce to be received upon delivery.

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NOTE 10 - STOCKHOLDERS' DEFICIT (Details) - USD ($)		1 Months Ended		3 Months Ended		9 Months Ended
	Aug. 09, 2017	Jan. 23, 2019	Jul. 28, 2017	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2018
Common stock returned, Shares			18,000,000
Common stock returned, Amount			$ 36,000
Common stock returned	20,000,000		20,000,000
Common stock cancelled			18,000,000
Common stock issued	2,000,000		2,000,000
Value of stock returned			$ 1,890,000
Interest charge		$ 127,800	$ 127,800	$ 161,583	$ 164,556	$ 491,177	$ 508,764
Additional Paid in Capital		$ 340,200		$ 340,200
Common shares authorized				550,000,000		550,000,000		300,000,000
Stock issued from related party, Shares				18,000,000
Stock issued from related party, Amount				$ 1,890,000
Options granted						30,000,000
Options expired/ cancelled						100,000
Intrinsic value of options and warrants vested and expected to vest				$ 150,000		$ 150,000
Share Price				$ 0.055		$ 0.055
Intrinsic value of options and warrants exercised						$ 0
Grant-date fair value of option and warrant shares vested						$ 1,497,985
Directors [Member]
Options granted						30,000,000
Option term						5 years
Exercise price				0.05		$ 0.05
Warrant
Warrants expired						3,240,000
Exercise price				$ 0.15		$ 0.15
Investor
Sale restricted common stock, Shares						3,433,333
Sale restricted common stock, Amount						$ 258,000
Consultant
Stock Issued During Period, Shares, Issued for Services						1,179,134
Stock Issued During Period, Value, Issued for Services						$ 114,413
Warrant term								5 years
Warrant grant price							$ 0.15

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NOTE 10 - STOCKHOLDERS' DEFICIT: Schedule Of Stock Options (Details)	9 Months Ended
	Mar. 31, 2019 $ / shares shares
Text Block [Abstract]
Stock Options Outstanding at beginning | shares	200,000
Options granted | shares	30,000,000
Options cancelled | shares	0
Options expired | shares	(100,000)
Options exercised | shares	0
Stock options Outstanding at end | shares	30,100,000
Stock Options Outstanding, at beginning weighted average exercise price | $ / shares	$ 0.08
Stock options weighted average price granted | $ / shares	0.05
Options cancelled weighted average price | $ / shares
Options expired weighted average price | $ / shares	0.08
Options exercised weighted average price | $ / shares
Stock Options Outstanding at end, weighted average exercise price | $ / shares	$ 0.05
Stock Warrants, outstanding, beginning balance | shares	4,420,000
Warrants, granted | shares	0
Warrants, canceled | shares	0
Warrants, expired | shares	(3,240,000)
Warrants, exercised | shares	0
Stock Warrants, outstanding, ending balance | shares	1,180,000
Stock Warrant, outstanding, weighted average exercise price, beginning balance | $ / shares	$ 0.15
Stock Warrants granted, weighted average price granted | $ / shares
Warrants canceled, weighted average price | $ / shares
Warrants expired, weighted average price | $ / shares	0.15
Warrants, exercised, weighted average price | $ / shares
Warrant, outstanding, weighted average exercise price, ending balance | $ / shares	$ 0.15

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NOTE 10 - STOCKHOLDERS' DEFICIT: Stock options and warrants outstanding and exercisable (Details) - $ / shares	9 Months Ended
	Mar. 31, 2019	Jun. 30, 2018
Stock Options Outstanding	30,100,000	200,000
Stock Options Outstanding, weighted average exercise price	$ 0.05	$ 0.08
Warrant
Stock Options Outstanding	4,420,000
Exercisable	4,420,000
Stock Options Outstanding, weighted average exercise price	$ 0.15
Outstanding, weighted average contractual remaining life (in Years)	4 months 2 days
Exercisable, weighted average contractual remaining life (in Years)	4 months 2 days
Exercisable, weighted average exercise price	$ 0.15
$0.15 | Warrant
Stock Options Outstanding	1,180,000
Exercisable	1,180,000
Stock Options Outstanding, weighted average exercise price	$ 0.15
Outstanding, weighted average contractual remaining life (in Years)	4 months 2 days
Employee Stock Option
Stock Options Outstanding	200,000
Exercisable	200,000
Stock Options Outstanding, weighted average exercise price	$ 0.05
Outstanding, weighted average contractual remaining life (in Years)	4 years 11 months 15 days
Exercisable, weighted average contractual remaining life (in Years)	4 years 11 months 15 days
Exercisable, weighted average exercise price	$ 0.05
Employee Stock Option | $0.05
Stock Options Outstanding	30,000,000
Exercisable	30,000,000
Stock Options Outstanding, weighted average exercise price	$ 0.05
Outstanding, weighted average contractual remaining life (in Years)	4 years 11 months 23 days
Employee Stock Option | $0.07
Stock Options Outstanding	100,000
Exercisable	100,000
Stock Options Outstanding, weighted average exercise price	$ 0.07
Outstanding, weighted average contractual remaining life (in Years)	9 months 3 days

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NOTE 11 - RELATED PARTY TRANSACTIONS (Details) - USD ($)		1 Months Ended			3 Months Ended			9 Months Ended		12 Months Ended
	Aug. 09, 2017	Nov. 30, 2018	Sep. 19, 2018	Jul. 28, 2017	Dec. 31, 2019	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2017	Oct. 02, 2018
Sale of common stock for cash, shares	2,000,000			2,000,000
Purchase of property, Plant, and Equipment								$ 25,543	$ 0
Common stock returned	20,000,000			20,000,000
Interest rate					6.00%	6.00%
Operating cost						$ 1,867,931	$ 256,501	2,394,410	$ 1,251,753	$ 971,099
Loan from related party					$ 51,462	51,462
Interest expense						762
Accrued interest						$ 762		$ 762
Thomas Laws
Assets pledged		$ 930,000
Related cost		$ 1,197,198
Secured Promissory Note
Principal amount			$ 930,000								$ 930,000
Interest rate			4.00%
Maturity date			Sep. 30, 2018
Chief Executive Officer [Member]
Purchase of property, Plant, and Equipment										926,000
Purchase of Machinery and Equipment										$ 1,009,099
Funds expended description										Mr. Laws were misappropriated in the amount of $971,099 and a deposit of $38,000 was valid and refunded to the Company in a subsequent period. Of this amount, the $500,000 deposit that was to be made on the Alhambra Acquisition was subsequently determined never made the sellers. See NOTE 13 - Subsequent Events, Misappropriated Funds and Entry into a Material Definitive Agreement.
Consulting fees										$ 125,000

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NOTE 12 - LEGAL PROCEEDINGS (Details) - USD ($)	1 Months Ended			3 Months Ended				9 Months Ended
	Jan. 23, 2019	Jul. 28, 2017	Dec. 31, 2016	Dec. 31, 2019	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2016	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2018
Interest rate				6.00%	6.00%
Interest expense	$ 127,800	$ 127,800			$ 161,583	$ 164,556		$ 491,177	$ 508,764
Boart Long year Company
Principal amount					158,480			$ 158,480
Interest rate								5.25%
Accrued interest			$ 13,860		26,264		$ 13,860	$ 26,264		$ 20,019
Legal fees							21,454
Interest expense								6,245	6,246
Gain on trust debt forgiveness							6,287
Wagner Equipment
Principal amount					115,789			$ 115,789
Interest rate								8.75%
Accrued interest			26,875		$ 45,045		$ 26,875	$ 45,045		$ 37,440
Interest expense								$ 7,605	$ 7,605
Gain on trust debt forgiveness			$ 4,591

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NOTE 13 - SUBSEQUENT EVENTS (Details) - USD ($)		1 Months Ended				3 Months Ended		9 Months Ended		12 Months Ended	16 Months Ended
	Apr. 10, 2020	Jun. 30, 2020	Nov. 30, 2018	Nov. 30, 2017	Aug. 31, 2017	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2017	Aug. 14, 2020	Oct. 02, 2018	Sep. 19, 2018
Share Price						$ 0.055		$ 0.055
Acquisition description					Company will acquire all the capital stock of Bullard’s Peak Corporation (which owns five patented claims and 82 unpatented claims in the Black Hawk district of New Mexico) from Black Hawk Consolidated Mines Company for a purchase price of $3,000,000, and the capital stock of Bullard’s Peak Corporation and the mining claims collateralize the full purchase price payment. The Company granted the seller a 2% net smelter return in perpetuity. The net smelter return is 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. Title to the claims will be transferred upon receipt by seller of the full purchase price. In August 2018, the Company was informed that the seller terminated the stock purchase agreement. Pursuant to an amendment to the stock purchase agreement in October 2018, the Company paid the seller $100,000 and the seller rescinded the August 2018 election to terminate the stock purchase agreement and waived all then existing events of default and any additional interest, late fees, and other damage claims due to the Company’s prior breaches of the stock purchase agreement. On October 31, 2018, the Company paid the seller an additional $100,000. The balance of the purchase price of $350,365 (which includes $50,365 of expenses that the Company agreed to reimburse seller) is required to be paid: (i) $100,000 on or before November 30, 2018 and (ii) $250,365 on or before December 31, 2018. If any payment is not timely paid, all rights of the Company under the stock purchase agreement shall become automatically null and void and seller shall retain all monies paid as liquidated damages for the Company’s breach, and seller shall have no further obligations to the Company, including but not limited to, any obligation to transfer the capital stock of Bullard’s Peak Corporation to the Company pursuant to the terms of the stock purchase agreement. We paid $100,000 in November 2018 with respect to the Alhambra Silver Mine acquisition and owed a balance of approximately $250,000 on December 31, 2018, to complete the acquisition. Lack of funding on December 31, 2018 resulted in us entering into a third amendment pursuant to which we paid $65,000 on January 2, 2019, a late fee payment on February 1, 2019 of $50,000, a $100,000 on February 28, 2019, and the final payment of $100,365 was paid on April 2, 2019, for the total cost of $3,115,365.
Properties Description				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 remained in trust with the sellers until payment in full. To date, the Company has paid to the sellers’ consideration of Can$260,000. The Company disclosed in a Form 8-K filing on November 20, 2018 that it had been notified that it was in default with respect to these two November 2017 agreements and that the sellers threatened legal action. The Company has engaged British Columbia counsel to review the two November 2017 agreements and has concluded that there were false representations made by the sellers and that certain conditions precedent of sellers were not satisfied. As a result, the Company’s position is that these two November 2017 agreements are not and were never binding and have requested sellers to refund the Can$260,000. The Company so informed sellers on March 4, 2019. The Company continues to evaluate its rights and remedies in connection with this matter. As a result, the Company does not own any rights to the four placer claims located in the Vernon mining district of British Columbia, Canada (which property is more fully set forth in the Form 8-K filing dated November 20, 2018). At the time of the filing of this report the agreements are being scheduled for arbitration by the Company attorney. At June 30, 2019, the Company impaired the investment in the amount of $210,116.
Operating cost						$ 1,867,931	$ 256,501	$ 2,394,410	$ 1,251,753	$ 971,099
Secured Promissory Note
Principal amount												$ 930,000	$ 930,000
Thomas Laws
Assets pledged			$ 930,000
Related cost			$ 1,197,198
Subsequent Event | Consultant
Restricted common shares purchased, Shares											2,656,884
Restricted common sthares purchased, Value											$ 237,381
Subsequent Event | Investor
Restricted common shares purchased, Shares											46,775,910
Restricted common sthares purchased, Value											$ 2,893,980
Restricted common stock issued for exercise of warrants, Shares											2,750,000
Subsequent Event | Investor | Minimum
Warrant exercise price											$ 0.05
Subsequent Event | Investor | Maximum
Warrant exercise price											$ 0.07
Subsequent Event | Chairman
Restricted common shares purchased, Shares											7,892,858
Restricted common sthares purchased, Value											$ 475,000
Restricted common stock issued for exercise of warrants, Shares											2,250,000
Subsequent Event | Chief Financial Officer [Member]
Debt conversion, shares		964,299
Restricted common shares purchased, Shares	2,000,000
Restricted common sthares purchased, Value	$ 117,000	$ 67,501
Warrant exercise price	$ 0.005	$ 0.05
Amount converted for accrued salary	$ 100,000
Loss on debt conversion	$ 17,000	$ 19,287
Warrants issued	1,000,000	482,149
Subsequent Event | Chief Financial Officer [Member] | Principal
Debt conversion, amount		$ 42,036
Subsequent Event | Chief Financial Officer [Member] | Interest
Debt conversion, amount		$ 6,178

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NOTE 13 - SUBSEQUENT EVENTS: Summary of gain on debt extinguishment (Details) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Mar. 30, 2018	Jun. 30, 2019
Gain on debt extinguishment	$ 0	$ 0	$ 112,625	$ 0
Subsequent Event
Gain on debt extinguishment					$ 12,620,165
Subsequent Event | Merger Agreement, loan balance
Gain on debt extinguishment					1,745,092
Subsequent Event | Merger Agreement, loan accrued interest
Gain on debt extinguishment					2,155,335
Subsequent Event | Merger Agreement accrued fees
Gain on debt extinguishment					269,986
Subsequent Event | Goldstream loan balance
Gain on debt extinguishment					3,742,505
Subsequent Event | Completion Guaranty accrued interest
Gain on debt extinguishment					1,234,749
Subsequent Event | Completion Guaranty Payable
Gain on debt extinguishment					3,359,873
Subsequent Event | Forbearance Agreement
Gain on debt extinguishment					$ 112,625