~~U.S.~~UNITED ~~SECURITIES~~STATESSECURITIES 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
For the Quarterly Period Ended September 30, 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
(State or Other Jurisdiction	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

3544 Rio Grande Blvd. NW Albuquerque, NM 87107 (Address of Principal Executive Offices)

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
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 ¨þ

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 ¨þ

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.

~~SANTA~~Indicate FEby ~~GOLD~~check ~~CORPORATION~~mark ~~INDEX~~whether TOthe ~~FORM~~registrant 10is a shell company (as defined by Rule 12b-Q2 ~~PART~~of Ithe ~~FINANCIAL~~Exchange ~~INFORMATION~~Act). Yes ¨ No þ

		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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date 427,504,214 shares of common stock par value $0.002, of the issuer were issued and outstanding as of October 26, 2020.

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

SANTA FE GOLD CORPORATION

INDEX TO FORM 10-Q

PART I

FINANCIAL INFORMATION

		Page
	Cautionary Statement on Forward-Looking Statements	4
	Cautionary Note Regarding Exploration Stage Status	5
	SEC Industry Guide Definitions	5

Item 1.	Financial Statements	6
	Consolidated Balance Sheets as of September 30, 2019 (Unaudited) and June 30, 2019	6
	Consolidated Statements of Operations for the Three Months Ended September 30, 2019 and 2018 (Unaudited)	7
	Consolidated Statements of Changes in Stockholders’ Deficit for the Three Months Ended September 30, 2019 and 2018 (Unaudited)	8
	Consolidated Statements of Cash Flows for the Three Months Ended September 30, 2019 and 2018 (Unaudited)	9
	Notes to the Consolidated Financial Statements (Unaudited)	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	22
Item 4.	Controls and Procedures	23

PART II OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 1A	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	26
Item 4.	Mine Safety Disclosures	26
Item 5.	Other Information	26
Item 6.	Exhibits	26
SIGNATURES		26
CERTIFICATIONS

CAUTIONARY STATEMENT ON 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,” “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; including but not limited to statements regarding the following:

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

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

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

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

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

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

•significant risk and hazards associated with mining operations;

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

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

•our anticipated needs for working capital;

•our ability to secure financing;

•claims and legal proceedings against us;

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

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

•changes in the price of silver and gold;

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

•our projected sales and profitability;

•our business growth strategies;

•anticipated trends in our industry;

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

•problems regarding availability of materials and equipment;

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

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

Occurrence of such events or circumstances could have a material adverse effect on our business, financial condition, results of operations or cash flows or the market price of our securities. All subsequent written and oral forward-looking statements by or

attributable to us or persons acting on our behalf are expressly qualified in their entirety by these factors. Except as may be required by securities or other law, the Company does not intend to undertake to update the information in this Form 10-Q if any forward-looking statement later turns out to be inaccurate whether as a result of new information, future events, or other circumstances.

CAUTIONARY NOTE REGARDING EXPLORATION STAGE STATUS

We are considered an “exploration stage” company under the U.S. Securities and Exchange Commission (“SEC”) Industry Guide 7, Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations (“Industry Guide 7”), because we do not have reserves as defined under Industry Guide 7. Reserves are defined in Industry Guide 7 as that part of a mineral deposit which can be economically and legally extracted or produced at the time of the reserve determination. The establishment of reserves under Industry Guide 7 requires, among other things, certain spacing of exploratory drill holes to establish the required continuity of mineralization and the completion of a detailed cost or feasibility study.

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

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

SEC INDUSTRY GUIDE 7 DEFINITIONS

The following definitions are taken from the mining industry guide entitled “Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations” contained in the Securities Act Industry Guides published by the United States Securities and Exchange Commission, as amended.

Exploration State		The term “exploration state” (or “exploration stage”) includes all issuers engaged in the search for mineral deposits (reserves) which are not in either the development or production stage.

Development Stage		The term “development stage” includes all issuers engaged in the preparation of an established commercially mineable deposit (reserves) for its extraction which are not in the production stage. This stage occurs after completion of a feasibility study.

Mineralized Material		The term “mineralized material” refers to material that is not included in the reserve as it does not meet all of the criteria for adequate demonstration for economic or legal extraction.

Probable (Indicated) Reserve		The term “probable reserve” or “indicated reserve” refers to reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven reserves, is high enough to assume continuity between points of observation.

Production Stage		The term “production stage” includes all issuers engaged in the exploitation of a mineral deposit (reserve).

Proven (Measured) Reserve		The term “proven reserve” or “measured reserve” refers to reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.

Reserve		The term “reserve” refers to that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. Reserves must be supported by a feasibility study done to bankable standards that demonstrates the economic extraction. (“Bankable standards” implies that the confidence attached to the costs and achievements developed in the study is sufficient for the project to be eligible for external debt financing.) A reserve includes adjustments to the in-situ tons and grade to include diluting materials and allowances for losses that might occur when the material is mined.

PART I
FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SANTA FE GOLD CORPORATION CONSOLIDATED BALANCE SHEETS
		March 31,			June 30,
		September 30,			June 30,
		2019			~~2018~~2019*
		(Unaudited)			(Audited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	37227,~~977~~387		$	18264,~~897~~900
Prepaid expenses and other current assets		1319,~~688~~209			1176,~~680~~921
Total Current Assets		51,665			30,577
Total current assets		246,596			341,821
OTHER ASSETS:
NON-CURRENT ASSETS:
Mineral property		3,015,000			2,500,000
Property and equipment, net		232,808			25,543
Deposit on mineral leases		260,116			210,116
Mineral property		3,515,365			3,315,365
Investment in joint venture		—			25,000
Total non-current assets		3,748,173			3,340,908
Total Assets	$	3,~~326~~994,~~781~~769		$	23,~~765~~682,~~693~~729
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable	$	3,~~139~~329,~~464~~457		$	3,~~061~~151,~~976~~035
Accrued liabilities		7668,~~453,870~~363			6645,~~906,930~~068
Subscribed capital		—			2,772,191
Notes payable		558,543			598,543
Note payable and accrued interest related party		52,224			—
Notes payable and accrued interest to related party		74,528			63,499
Notes payable		2,383,635			2,326,407
Total Current Liabilities		4,630,891			4,458,145
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
Common stock, $.002 par value, 550,000,000 shares authorized at September 30, 2019 and June 30, 2019; 392,242,397 issued and outstanding at September 30, 2019 and 379,775,217 shares issued and outstanding at June 30, 2019		784,485			759,550
Additional paid-in capital		9092,~~915~~794,~~117~~048			8491,~~113~~943,~~690~~704
Accumulated deficit		(~~104~~94,~~702~~214,~~164~~655)	)		(~~102~~93,~~013~~478,~~374~~670)	)
Total Stockholders' Deficit		(13636,~~062,285~~122)	)		(17775,~~299,684~~416)	)
Total Liabilities and Stockholders' Deficit	$	3,~~326~~994,~~781~~769		$	23,~~765~~682,~~693~~729

*The balance sheet at June 30, ~~2018~~2019 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.

SANTA FE GOLD CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)
	Three Months Ended September 30,
	2019		2018

REVENUES	$	—	$	—

Exploration and other mine related costs		282,974		6,076
General and administrative		466,400		294,326
Total Operating Expenses		749,374		300,402

LOSS FROM OPERATIONS		(749,374)		(300,402)

OTHER INCOME (EXPENSE):
Recovery (misappropriation) of funds		27,539		378,060
Financing costs- commodity supply agreements		—		234,417
Interest expense		(14,150)		(165,783)
Total Other Income (Expense)		13,389		446,694


INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES		(735,985)		146,292

PROVISION FOR INCOME TAXES		—		—

NET INCOME (LOSS)	$	(735,985)	$	146,292

Basic and Diluted Per Share Data:
Net Income (Loss) - Basic	$	(0.00)	$	(0.00)
Net Income ( Loss) - Diluted	$	(0.00)	$	(0.00)
Weighted Average Common Shares Outstanding:
Basic		387,108,689		300,000,000
Diluted		387,108,689		300,100,000

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

SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF ~~OPERATIONS~~STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018

(Unaudited)

	Three Months Ended March 31,						Nine Months Ended March 31,
							Additional
		2019			2018			2019			2018
Three Months Ended September 30, 2019:	Common Stock						Paid-In			Accumulated
REVENUES	$	—		$	—		$	—		$	—
	Shares			Amount			Capital			Deficit			Total
OPERATING EXPENSES:
Balance, June 30, 2019		379,775,217		$	759,550		$	91,943,704		$	(93,478,670	)	$	(775,416	)
Exploration and mine related costs		32,718			3,317			40,407			37,914
Consulting stock-based compensation		181,466			363			14,916			—			15,279
General and administrative		1,835,213			253,184			2,354,003			1,213,839
Share subscriptions issued		12,285,714			24,572			835,428			—			860,000
Total Operating Expenses		1,867,931			256,501			2,394,410			1,251,753
Net income (loss)		—			—			—			(735,985	)		(735,985	)
LOSS FROM OPERATIONS		(1,867,931	)		(256,501	)		(2,394,410	)		(1,251,753	)
Balance, September 30, 2019 (Unaudited)		392,242,397		$	784,485		$	92,794,048		$	(94,214,655	)	$	(636,122	)
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

					Additional
Three Months Ended September 30, 2018:	Common Stock				Paid- In		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balances, June 30, 2018		300,000,000	$	600,000	$	84,113,690	$	(102,013,374	)	$	(17,299,684	)

Valuation change on mandatory share
redemption		—		—		342,000		—			342,000
Net Income		—		—		—		146,292			146,292
Balances, September 30, 2018 (Unaudited)		300,000,000	$	600,000	$	84,455,690	$	(101,867,082	)	$	(16,811,392	)

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

SANTA FE GOLD CORPORATION

SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)



		Three Months Ended
		September 30,
		2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(735,985	)	$	146,292
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Stock-based compensation		15,279			17,800
Financing costs – commodity supply agreements		—			(234,417	)
Depreciation expense		6,670			—
Non-cash interest expense		1,029			—
Net change in operating assets and liabilities:
Prepaid expenses and other current assets		57,712			(5,853	)
Accounts payable and accrued liabilities		186,717			188,613
Net Cash (Used) Provided in Operating Activities		(468,578	)		112,435

CASH FLOWS FROM INVESTING ACTIVITIES:
Payment on mineral property		(200,000	)		—
Purchase of property and equipment		(198,935	)		—
Net Cash Used in Investing Activities:		(398,935	)		—

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock subscriptions		860,000			200,000
Loan proceeds from a related party		10,000			—
Payment on note payable principle		(40,000	)		—
Net Cash Provided by Financing Activities		830,000			200,000

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(37,513	)		312,435
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		264,900			18,897
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	227,387		$	331,332

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	—		$	—
Cash paid for income taxes	$	—		$	—

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Valuation change on mandatory share redemption	$	—		$	342,000

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.

SANTA FE GOLD CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~March~~September 3130, 2019

(Unaudited)

NOTE 1 – ~~COMPANY~~ORGANIZATION AND ~~NATURE~~BUSINESS ~~OF OPERATIONS~~DESCRIPTION

Santa Fe Gold Corporation, ~~a Delaware corporation~~ (the ~~"Santa Fe~~“Company”, ~~"Company",~~ “our” or “we”) is a U.S. ~~copper~~mining company incorporated in Delaware in August 1991. Our general business strategy is to acquire, ~~silver~~explore, develop and ~~gold~~mine ~~exploration~~mineral properties. The Company elected on August 26, 2015, to file for Chapter 11 Bankruptcy protection, Case # 15-11761 (MFW) and that case was dismissed on June 15, 2016. The Summit Silver-Gold Project, the Lordsburg Copper Project, Black Canyon Mica Project, Planet MIO Project, all claims and other assets were lost in the process. After the Company emerged from the bankruptcy with a management team of two with no assets, we developed a business plan to raise equity funds to acquire new mining ~~company~~claims, a potential processing plant or arrangements with a processing plant in an acceptable geographic location to potential new mining claims.

~~The~~In ~~accompanying~~August ~~unaudited~~2017, ~~financial statements and related notes present~~ the Company’s ~~consolidated~~acquired ~~financial~~all ~~position as of March 31, 2019 and June 30, 2018 (Audited),~~ the ~~consolidated~~capital ~~results~~stock of ~~operations~~Bullard’s ~~for~~Peak ~~the~~Corporation ~~three~~ and ~~nine months ended March 31, 2019 and 2018, and consolidated cash flows for~~ the ~~nine~~related ~~months~~patented ~~ended March, 2019~~ and ~~2018.~~unpatented ~~The~~claims ~~unaudited financial statements have been prepared~~ in ~~accordance with accounting principles generally accepted in~~ the ~~United~~Black ~~States~~Hawk ofdistrict ~~America for interim financial information and with the instructions~~ of ~~Form 10-Q~~New ~~and~~Mexico ~~Article 10~~from ofBlack ~~Regulation~~Hawk ~~S-X.~~Consolidated ~~Accordingly,~~Mines ~~they~~Company ~~do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America~~ for ~~complete~~a ~~financial~~purchase ~~statements.~~price ~~In the opinion~~ of ~~management~~$3, ~~all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included~~115,365. ~~Operating~~The ~~results~~mine ~~for~~property ~~the~~is ~~nine~~known ~~months~~as ~~ended March 31, 2019, are not necessarily indicative of~~ the ~~results~~Alhambra ~~that~~mine ~~may be expected for the fiscal year ending June 30, 2019~~site. The ~~accounting~~transaction ~~policies~~was ~~followed~~finalized byand ~~the~~closed ~~Company are set forth~~ in ~~Note~~April ~~2 to the Company’s financial statements included in Form 10-K for the fiscal year ended June 30,~~ 2019. ~~These~~The ~~interim~~mining ~~financial~~property ~~statements~~acquired ~~and~~is ~~notes~~an ~~thereto~~asset ~~should~~of beMineral ~~read~~Acquisitions, inLLC, ~~conjunction~~one ~~with~~of the ~~consolidated financial statements presented in the~~ Company’s ~~2019~~five ~~Annual~~wholly ~~Report~~owned ~~on Form 10-K filed on July 15, 2020~~subsidiaries.

~~Nature~~In January 2019 the Company has acquired right of ~~Operations~~use on two properties in western New Mexico, consisting of eight (8) patented claims and two unpatented claims, all located in the Steeple Rock Mining District, Grant County, New Mexico and a related water rights lease agreement. The two properties are known as the Billali Mine and the Jim Crow Imperial Mine. The Company has begun improvements to the Jim Crow Imperial mine to start mining operations during the third calendar quarter of 2020.

~~Santa~~We Feare ~~Gold~~considered ~~Corporation~~an is“exploration astage” ~~U.S. mining~~ company ~~incorporated~~under inthe ~~Delaware in August 1991~~U.S. ~~Our~~Securities ~~general business strategy is to acquire, explore, develop~~ and ~~mine~~Exchange ~~mineral~~Commission ~~properties. The Company elected on August 26, 2015, to file for Chapter 11 Bankruptcy protection, Case # 15-11761~~ (~~MFW~~“SEC”) ~~and~~Industry ~~that~~Guide ~~case was dismissed on June 15, 2016~~7.

~~Upon~~Interim ~~the~~Financial 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. Statements

OnThe ~~August~~accompanying 18unaudited financial statements and related notes present the Company’s consolidated financial position as of September 30, ~~2017~~2019 and June 30, 2019 (Audited), the ~~Company~~consolidated ~~signed~~results of operations for the ~~Bullard~~three months ended September 30, 2019 and 2018, the consolidated statements of shareholders’s ~~Peak~~deficit ~~Agreement~~for the three months ended September 30, 2019 and ~~delivered~~2018 ~~$100~~and,~~000~~ ~~towards~~consolidated cash flows for the ~~purchase~~three ~~price~~months ended September 30, 2019 and 2018. The ~~Agreement~~unaudited isfinancial tostatements ~~purchase~~have ~~Bullard’s~~been ~~Peak~~prepared ~~Corporation~~in accordance with accounting principles generally accepted in the United States of America for interim financial information and ~~Black~~with ~~Hawk~~the ~~Consolidated~~instructions ~~Mines~~of ~~Company~~Form 10-Q and ~~acquire~~Article 10 ~~100%~~of Regulation S-X. Accordingly, they do not include all of the ~~issued~~information and ~~outstanding~~footnotes ~~capital~~required ~~stock~~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 ~~cash~~fair ~~purchase~~presentation ~~price~~have inbeen included. Operating results for the ~~aggregate~~three ~~amount~~months ofended $3September 30,~~000~~ 2019,~~000~~ are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2020. 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 ~~paid~~notes thereto should be read in conjunction with ~~installments~~the ~~stated~~consolidated financial statements presented in the ~~Bullard~~Company’s ~~Peak~~2019 ~~Agreement.~~Annual Report on Form 10-K filed on July 15, 2020.

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 anet loss of $2735,~~688,790~~985 for the ~~nine~~three months ended ~~March~~September 3130, 2019, and has a total accumulated deficit of $~~104~~94,~~702~~214,~~164~~655 and a working capital deficit at ~~March~~September ~~31.~~30, 2019 of $164,~~337~~384,~~401~~295. The Company used in operating activities approximately $469,000 during the current period of measurement. 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. 10

6To continue as a going concern, the Company is dependent on continued capital financing for project development, repayment of various debt facilities and payment of current operating expenses until the Company has put into production an acceptable source to generate mineralized ore to generate a revenue stream. Currently we have no commitment from any party to provide additional working capital and there is no assurance that any funding will be available as required, or if available, that its terms will be favorable or acceptable to the Company.

ToAt ~~continue~~September as30, ~~a going concern~~2019, the Company iswas ~~dependent~~in default on ~~continued~~delinquent ~~capital~~payments ~~financing for project development, repayment~~ of ~~various~~approximately: ~~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~~$3.04 Wemillion ~~have~~on noaccounts ~~commitment~~payable, ~~from~~$398,000 ~~any~~on ~~party~~a tonote ~~provide~~payable ~~additional working capital~~ and ~~there is no assurance that any funding will be available as required~~$643,000 oron ifother ~~available,~~accrued ~~that its terms will be favorable or acceptable to the Company~~liabilities.

AtThe ~~March~~unaudited ~~31,~~consolidated ~~2019,~~financial ~~the~~statements ~~Company~~do ~~was~~not ininclude ~~defaults~~any onadjustments ~~payments~~relating ofto ~~approximately~~the ~~$7.87~~recoverability ~~million~~and ~~under~~classification aof ~~gold~~asset ~~stream~~amounts ~~agreement~~or (the ~~“Gold~~classification ~~Stream~~of ~~Agreement”)~~liabilities ~~with~~that ~~Sandstorm~~might ~~Gold~~be ~~Ltd.~~necessary ~~(“Sandstorm”),~~should ~~other~~the ~~notes~~Company ~~payable~~be ~~principle~~unable ~~aggregating~~to ~~approximating~~continue ~~$2.38~~as ~~million,~~a ~~accrued~~going ~~liabilities of approximately $2~~concern.~~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, Mineral ~~and Minerals~~ Acquisitions, ~~LLC,~~ a New Mexico Limited Liability Company and Bullard’s Peak Corporation, a New Mexico Corporation. All significant inter-company accounts and transactions have been eliminated in consolidation.

OnUse ~~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, valuation of warrants, 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~~September 3130, 2019, and June 30, ~~2017~~2019, 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.

Property and Equipment

Property and equipment are carried at cost. Maintenance and repairs that do not improve or extend the life of the respective assets are expensed as incurred. Expenditures for new property or equipment and expenditures that extend the useful lives of existing property and equipment are capitalized and recorded at cost. Upon retirement, sale or other disposition, the cost and accumulated amortization are eliminated and the gain or loss is included in operations. Depreciation is taken over the estimated useful lives of the assets using the straight-line method. The estimated useful lives of the equipment are shown below. Land is not depreciated.

	Estimated Useful Life
Mine equipment	7 Years
General equipment	5 – 7 Years
Automotive	4.5 - 5 Years
Small tools	1.25 Years

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.11

~~Derivative~~The ~~financial~~Financial ~~instruments~~Accounting ~~are~~Standards ~~initially~~Board ~~measured~~(“FASB”) atprovides ~~their~~guidance ~~fair~~that ~~value.~~requires ~~For~~ derivative ~~financial~~ instruments ~~that~~to ~~are~~be ~~accounted~~recognized ~~for~~ as either assets or liabilities, in the ~~derivative~~balance ~~instrument~~sheet isat ~~initially~~fair ~~recorded~~value. atThe ~~its~~accounting for changes in the fair value of derivative instruments depends on their intended use and isresulting ~~then~~hedge ~~re-valued~~designations. atFor ~~each~~derivative ~~reporting~~instruments ~~date~~designated as hedges, ~~with~~the changes in ~~the~~ fair value ~~reported~~are recorded in the balance sheets as ~~charges~~a orcomponent ~~credits~~of toaccumulated other comprehensive income (loss). ToChanges in the ~~extent~~fair ~~that~~value ~~the~~of ~~initial~~derivative ~~fair~~instruments ~~values~~not ofdesignated as hedges are recorded in the ~~freestanding~~consolidated ~~and/or~~statements ~~bifurcated~~of operations, generally as a component of other income (expense).

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~~September 3130, 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
For the three months ended September 30, 2018
Basic EPS
Income available to common stockholders	$	~~$ 364~~146,~~208~~292		300,000,000	$	0.00
Diluted EPS
Dilutive shares from options and warrants		—		75100,000
Income available to common stockholders plus assumed conversions	$	~~$ 364~~146,~~208~~292		300,~~075~~100,000	$	0.00

The number of stock options excluded from the calculation of diluted earnings per share for the three months ended September 30, 2018 was 100,000 and excluded warrants was 4,320,000, because their inclusion would have been anti-dilutive.

Stock-Based Compensation

InShare-based ~~connection~~compensation ~~with~~is ~~terms~~accounted offor ~~employment~~based ~~with~~on the ~~Company~~requirements of ASC 718, “Compensation—Stock Compensation’s ~~executives~~(“ASC 718”), which requires recognition in the financial statements of the cost of employee and ~~employees,~~director services received in exchange for an award of equity instruments over the ~~Company~~period ~~occasionally~~the ~~issues~~employee ~~options~~or director is required to ~~acquire~~perform ~~its~~the ~~common~~services ~~stock~~in exchange for the award (presumptively, the vesting period). ~~Awards~~ASC ~~are~~718 ~~made~~also atrequires measurement of the ~~discretion~~cost of employee and director services received in exchange for an award based on the ~~Board~~grant-date fair value of ~~Directors~~the award. ~~Such~~Pursuant ~~options~~to ~~may~~ASC be505, ~~exercisable~~“Equity—Equity atBased ~~varying~~Payments ~~exercise~~to ~~prices~~Non-Employees” (“ASC 505-50”), for share-based payments to consultants and ~~generally~~other ~~vest~~third ~~over~~parties, acompensation ~~period~~expense ofis ~~six~~determined ~~months~~at tothe ameasurement ~~year~~date, which is the grant date. Until the measurement date is reached, the total amount of compensation expense remains uncertain.

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~~15,~~213~~279 ~~for~~and $17,800 in the ~~nine~~three months ending ~~March~~September 3130, 2019, and ~~$196~~2018,~~000~~ ~~for the nine months ended March 31, 2018~~respectively.

Accounting Standards to be Adopted in Future Periods

In ~~May~~February ~~2014~~2016, the FASB issued ~~ASC~~ASU ~~updated No. 2014~~2016-0902, ~~Revenue~~“Leases ~~from Contracts with Customers~~ (Topic ~~606 (ASU 2014-09~~842).,” ~~Under~~which ~~the~~requires ~~amendments~~lessees into ~~this~~recognize ~~update,~~assets ~~recognition~~and ofliabilities ~~revenue~~on ~~occurs~~the ~~when~~balance asheet ~~customer~~for ~~obtains~~the ~~control~~rights ofand ~~promised~~obligations ~~goods~~created orby ~~services~~all inleases anwith ~~amount~~a ~~that~~term ~~reflects~~of ~~the~~more ~~consideration~~than toone ~~which~~year. ~~the~~Accounting ~~entity~~by ~~expects~~lessors towill beremain ~~entitled~~similar into ~~exchange~~existing ~~for~~U.S. ~~those goods or services~~GAAP. InSubsequent ~~addition,~~accounting ~~the~~standards ~~new~~updates ~~standard~~have ~~requires~~been ~~that reporting companies disclose the nature~~issued, ~~amount,~~which ~~timing,~~amend and/or ~~uncertainty~~clarify ofthe ~~revenue~~application ~~and~~of ~~cash~~ASU ~~flows arising from contracts with customers~~2016-02. The ~~amendments~~guidance inis ~~this update are~~ effective for fiscal years, and interim periods within those years, beginning after December 15, ~~2017~~2018. The ~~new~~Company ~~standard~~adopted isTopic ~~required~~842 toas beof ~~applied~~July ~~either retrospectively to each prior reporting period presented~~1, or2019 ~~retrospectively~~and ~~with~~at ~~the~~this ~~cumulative~~time ~~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~~significant a lease agreement is ~~achieved~~entered.

812

In ~~August~~June ~~2016~~2018, the FASB issued ASU ~~No. 2016~~2018-1507, ~~Statement~~“Compensation of— Stock ~~Cash~~Compensation ~~Flows~~ (Topic ~~230~~718): ~~Classification~~Improvements to Nonemployee Share-Based Payment Accounting”, which expands the scope of ~~Certain~~Topic ~~Cash~~718 ~~Receipts~~to include all share-based payment transactions for acquiring goods and ~~Cash~~services ~~Payments~~from nonemployees. ~~This~~ ASU 2018-07 specifies that Topic 718 applies to all share-based payment transactions in which the grantor acquires goods and services to be used or consumed in its own operations by issuing share-based payment awards. ASU 2018-07 also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under ASC 606. ASU 2018-07 is effective for ~~annual~~fiscal ~~periods~~years beginning after December 15, ~~2017~~2018, ~~and~~including interim periods within those fiscal years~~. ASU~~, Nowith ~~2016-15~~early ~~addresses~~adoption ~~eight~~permitted, ~~specific~~but ~~cash~~no ~~flow~~earlier ~~issues~~than ~~with~~adoption ~~the objective~~ of ~~reducing~~ASC ~~the existing diversity in practice~~606. The Company adopted ~~this~~ASU ~~standard~~2018-07, effective July 1, ~~2018~~2019, and itdetermined ~~will~~the adoption of this standard did not have a material impact on the Company’s consolidated financial ~~position~~statements orand ~~results~~related ~~of operations~~disclosures.

In ~~February~~August ~~2016~~2018, the FASB issued ASU ~~2016~~2018-0213, ~~“Leases~~Fair Value Measurement (Topic ~~842~~820),”: ~~which~~Disclosure ~~requires~~Framework ~~lessees~~- Changes to ~~recognize~~the ~~assets~~Disclosure ~~and~~Requirements ~~liabilities~~for onFair ~~the~~Value ~~balance~~Measurement, ~~sheet~~which ~~for~~removes, ~~the~~modifies ~~rights~~ and ~~obligations~~adds ~~created~~various bydisclosure ~~all~~requirements ~~leases~~related ~~with~~to afair ~~term~~value ofdisclosures. ~~more~~Disclosures ~~than~~related ~~one~~to ~~year.~~transfers ~~Accounting~~between byfair ~~lessors~~value hierarchy levels will ~~remain~~be ~~similar~~removed toand ~~existing~~further ~~U.S.~~detail ~~GAAP.~~around ~~Subsequent~~changes ~~accounting~~in ~~standards~~unrealized ~~updates~~gains ~~have~~and ~~been~~losses ~~issued,~~for ~~which~~the ~~amend~~period and~~/or~~ ~~clarify~~unobservable ~~the~~inputs ~~application~~used ofin ~~ASU~~determining ~~2016-02~~level 3 fair value measurements will be added, among other changes. ~~The~~ASU ~~guidance~~2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, ~~2018~~2019. The Company ~~has~~is ~~not~~currently ~~adopted~~evaluating ~~Topic 842 as of the filing of~~ this ~~10-Q~~guidance and ~~at this time~~ the ~~new standard will not have an~~ impact on ~~our~~its ~~consolidated~~Consolidated ~~financial~~Financial ~~statements until significant a lease agreement is entered~~Statements.

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~~Mine 3Development ~~– DEPOSIT ON MINERAL PROPERTY~~

~~Acquisition~~Mine development costs include engineering and metallurgical studies, drilling and other related costs to delineate an ore body, and the building of ~~Bullard’s~~access ~~Peak~~ways, ~~Corporation~~shafts, lateral access, drifts, ramps and ~~Black~~other ~~Hawk~~infrastructure ~~Consolidated~~in ~~Mines~~an ~~Company~~underground mine. Costs incurred before mineralization is classified as proven and probable reserves are expensed and classified as exploration expense. Capitalization of mine development project costs, that meet the definition of an asset, begins once mineralization is classified as proven and probable reserves.

OnDrilling ~~August 18, 2017, the Company signed the Bullard’s Peak Agreement~~ and ~~delivered~~related ~~$100,000~~costs ~~towards~~are ~~the~~capitalized ~~purchase~~for ~~price.~~an ~~The~~ore ~~Agreement~~body iswhere toproven ~~purchase~~and ~~Bullard’s~~probable ~~Peak~~reserves ~~Corporation~~exist and ~~Black~~the ~~Hawk~~activities ~~Consolidated~~are ~~Mines~~directed ~~Company~~at ~~and~~obtaining ~~acquire~~additional ~~100%~~information ofon the ~~issued~~ore ~~and~~body ~~outstanding~~or ~~capital~~converting ~~stock~~non-reserve ~~for~~mineralization anto ~~initial~~proven ~~cash~~and ~~purchase~~probable ~~price~~reserves. ofAll ~~$3,000,000,~~other todrilling beand ~~paid~~related ~~with~~costs ~~installments~~are ~~stated~~expensed inas ~~the~~incurred. ~~Bullard’s~~Drilling ~~Peak~~costs ~~Agreement.~~incurred ~~Title~~during to the ~~claims~~production ~~and~~phase ~~capital~~for ~~stock~~operational ~~will~~ore becontrol ~~transferred~~are ~~upon~~allocated ~~receipt~~to byinventory ~~seller~~costs ofand ~~the~~then ~~full~~included ~~purchase price. Additional installments were made~~ as ~~follows~~a ~~through~~component ~~the end~~ of ~~the~~costs ~~current~~applicable ~~reporting~~to ~~period~~sales. ~~towards the purchase price:~~

-As ~~August~~of September 30, ~~2017~~2019, the Company ~~delivered~~has ~~$900,000;~~not established proven or probable reserves or established the commercial feasibility of any of our exploration projects and all exploration costs are being expensed. The Company may never identify proven and probable reserves.

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

-Costs ~~October~~of 13exploration, ~~2017,~~carrying and retaining unproven mineral lease properties are expensed as incurred. The Company expenses all mineral exploration costs as incurred as it is still in the exploration stage. If the Company ~~delivered~~identifies ~~$500~~proven and probable reserves in its investigation of its properties and upon development of a plan for operating a mine,~~000;~~ it would enter the development stage and capitalize future costs until production is established.

-To ~~January~~date, 2the Company has not established the commercial feasibility of any exploration projects; therefore, ~~2018~~all exploration costs are expensed as incurred. Mineral properties are capitalized at their fair value at the acquisition date, either as an individual asset purchase or as part of a business combination. ASC 930-805, “Extractive Activities-Mining: Business Combinations.” ASC 930-805 states that mineral rights consist of the ~~Company~~legal ~~delivered~~right ~~$500~~to explore,~~000;~~ extract, and retain at least a portion of the benefits from mineral deposits. Mining assets include mineral rights.

Acquired mineral rights are considered tangible assets under ASC 930-805. ~~October~~As ~~15,~~a ~~2018~~result, the ~~Company~~direct ~~delivered~~costs ~~$100,000;~~to acquire mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with acquiring patented and unpatented mining claims.

When a property reaches the production stage, the related capitalized costs are amortized on a units-of-production ~~October~~basis 31over the proven and probable reserves following the commencement of production. The Company assesses the carrying costs of the capitalized mineral properties for impairment under ASC 360-10, ~~2018~~“Impairment of long-lived assets”, and evaluates the ~~Company~~carrying ~~delivered~~value ~~$100~~under ASC 930-360,~~000;~~ “Extractive Activities - Mining”, annually. An impairment is recognized when the sum of the expected

~~- November 30, 2018, the Company delivered $100,000~~13

-undiscounted ~~January~~future 2cash ~~2019,~~flows is less than the ~~Company~~carrying ~~delivered~~amount ~~$65~~of the mineral properties. Impairment losses,~~000~~ if any, are measured as the excess of the carrying amount of the mineral properties over its estimated fair value.

-When ~~February~~it 1,is ~~2019~~determined that a mineral property can be economically developed as a result of establishing reserves, subsequent mine development is capitalized and are amortized using the ~~Company~~units ~~delivered~~of ~~$50,000~~production method over the estimated life of the ore body based on estimated recoverable tonnage in proven and probable reserves. We may never identify proven and probable reserves.

-At ~~February~~the 28time the Company has a revenue stream from a project, ~~2019~~the Company ~~delivered~~will ~~$100~~amortize any capitalized balance each quarter. Companies that have reserves under SEC Industry Guide 7 typically capitalize these costs,~~000~~ and subsequently depreciate or amortize them on a units-of-production basis as reserves are mined. Unlike these other companies, our properties have no reserves and we will depreciate or amortize any capitalized costs based on the most appropriate amortization method, which includes straight-line or units-of-production method over the estimated remaining life of the mine, as determined by our geologist. As we have no reliable information to compute a units of production methodology, we will amortize our capitalized costs on a straight-line basis over the estimated remaining life of the mine as determined by our geologist. Because of these and other differences, our financial statements may not be comparable to the financial statements of mining companies that have proven and probable reserves on their properties.

9Reclamation Costs

~~Purchase~~Reclamation obligations are recognized when incurred and recorded as liabilities at fair value. The liability is accreted over time through periodic charges to accretion expense. The asset retirement cost is capitalized as part of ~~four~~the ~~placer~~asset’s ~~claims~~carrying value and depreciated over the life of the related asset. Reclamation costs are periodically adjusted to reflect changes in ~~British~~the ~~Columbia~~estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs. The reclamation obligation is based on when spending for an existing disturbance will occur. The Company reviews, ~~Canada~~on an annual basis, unless otherwise deemed necessary, the reclamation obligation at each mine site in accordance with the provisions of ASC 440, “Asset Retirement and Environmental Obligations”, which establishes the standards for the initial measurement and subsequent accounting for obligations associated with the sale, abandonment, or other disposal of long-lived tangible assets arising from the acquisition, construction or development and for normal operations of such assets. No reclamation costs were required for the three months ended September 30, 2019.

OnNOTE ~~November~~3 ~~30,~~– PROPERTY ~~2017,~~AND 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).EQUIPMENT

~~Billali~~Property ~~Mine~~ and equipment consist of the ~~Jim~~following ~~Crow~~at ~~Imperial~~September ~~Mine~~30, ~~Mineral~~2019 ~~Interest~~and June 30, 2019:

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.

	September 30,			June 30,
	2019			2019
Vehicles	$	20,725		$	20,725
Small tools		4,882			—
Mining equipment		178,871			4,818
Land, non-mineral		35,000			—
		239,478			25,543
Less Accumulated depreciation		(6,670	)		—
	$	232,808		$	25,543

~~The~~During ~~Company~~the ~~entered~~three-month ~~into~~periods aended ~~purchase~~September ~~agreement~~30, ~~with a mining operator in January~~ 2019 toand ~~purchase~~2018 ~~two properties in western New Mexico,~~ the ~~Billali~~Company ~~Mine,~~recognized ~~and~~depreciation ~~the~~expense ~~Jim~~of ~~Crow Imperial Mine. The purchase price for all rights and interests to be conveyed is~~ $26,~~500,000~~670 ~~for the Billali Mine~~ and $70,~~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:~~ respectively.

*The Company during the current quarter, began maintenance and repair activities at the Jim Crow mine site along with geological work on the site and related mine ore material. The Company during this quarter purchased the required materials and equipment to perform the required activities under our mine manager. During the quarter our major mining equipment purchases aggregated $~~500~~174,053. The significant acquisitions were mainly a crusher, generators, wheel loader, conveyors and freight on related heavy equipment purchases. We also purchased a site for a storage yard for our mine inventory for $35,000 ~~paid~~and is accessible to ~~date~~our asBillali and Jim Crow mines. The property consist of 1.64 acres, has water and electricity to the ~~filing~~property, ~~date;~~ a night security light and security fencing with a truck access gate.

*buyer to pay $50,000 monthly commencing July 1, 2020, and continuing for the next subsequent 19 months; 14

*commencingNOTE 304 ~~days~~–MINERAL ~~after~~PROPERTIES ~~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;~~

*afterThe ~~the~~Company ~~final~~has ~~payment~~capitalized ~~above~~acquisition ~~and~~costs 30on ~~days~~mineral ~~thereafter,~~properties ~~the~~as ~~buyer~~follows: ~~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.

		September 30,		June 30,
		2019		2019
Alhambra - Blackhawk project	$	3,115,365	$	3,115,365
Billali – Jim Crow Imperial mineral rights project		400,000		200,000
		3,515,365		3,315,365
Less Accumulated amortization		—		—
	$	3,515,365	$	3,315,365

~~The~~Exploration ~~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.~~Status

~~Title~~We ~~and~~have ~~all~~not established that the Alhambra - Blackhawk project or Billali Mine - Jim Crow mine rights ~~and~~projects ~~interest~~contain inproven ~~the~~or ~~properties~~probably ~~will~~reserves, beas ~~conveyed~~defined under ~~the~~Industry ~~agreements~~Guide ~~upon~~7. Minimal ~~completion~~exploration ofactivities ~~the~~have ~~payments~~commenced ofto ~~the~~date ~~purchase~~and ~~prices~~minimal ofexploration costs have been incurred and expensed. To date, the ~~properties~~Company has not (i) commenced or adopted plans to conduct any exploration, (ii) prepared drilling plans, proposals, timetables or budgets for exploration work, or (iii) identified engineers and other personnel that will conduct or assist in any exploration work. The Company will need to raise funds to conduct exploration work and it currently lacks a firm financing commitment for any exploration activities.

~~NOTE~~The 4Company –commenced ~~ACCRUED~~development ~~LIABILITIES~~of the Jim Crow mine in late 2019. Work to date has consisted of beginning the upgrading of the surface facilities, rehabilitating the shaft, expanding the hoisting capability and underground development on three levels. A crushing plant was purchased and installed at Duncan, Arizona, in late 2019.

~~Accrued~~Acquired ~~liabilities~~mineral ~~consist~~rights are considered tangible assets under ASC 930-805. ASC 930-805 requires that mineral rights be recognized at fair value as of the ~~following~~acquisition atdate. Mining ~~March~~assets ~~31,~~include ~~2019~~mineral rights. The payments made under the Billali Mine - Jim Crow Mine Agreement are capitalized by the Company and ~~June~~when ~~30,~~a ~~2018:~~revenue stream is attained the capitalized balance will amortized.

		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

NOTE 5 – ACCRUED LIABILITIES

10Accrued liabilities consist of the following at September 30, 2019 and June 30, 2019:

NOTE 5 – COMPLETION GUARANTEE PAYABLE

		September 30,		June 30,
		2019		2019
Interest	$	207,442	$	194,318
Vacation		15,771		15,771
Payroll		119,794		124,623
Franchise taxes		8,697		8,697
Other		44,579		29,579
Audit		18,557		18,557
Property taxes		253,523		253,523
	$	668,363	$	645,068

~~At June 30, 2012, the Company calculated the completion guarantee payable provided by Amendment 1 under the Gold Stream Agreement with Sandstorm. See~~ NOTE 9-6 ~~CONTINGENCIES~~– NOTES 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.PAYABLE

~~NOTE~~Installment ~~6 - SHARES SUBJECT TO MANDATORY REDEMPTION BY RELATED PARTY~~Note

On ~~August~~June 91, ~~2017~~2012, athe ~~related~~Company ~~party~~entered ~~returned~~into aan ~~certificate~~installment ~~for~~sales ~~20,000,000~~contract ~~shares of common stock and was issued a new certificate~~ for 2$593,~~000,000~~657 ~~shares~~to onpurchase ~~the~~certain ~~same date~~equipment. The ~~related~~term ~~party~~of ~~loaned~~ the ~~18,000,000~~agreement ~~shares~~is tofor ~~the~~48 ~~Company~~months toat ~~raise~~an ~~additional~~interest ~~working~~rate ~~capital~~of ~~until~~5.75%, ~~the~~with ~~Company increased~~ the ~~authorized~~equipment ~~common~~securing ~~shares of~~ the ~~Company~~loan. The ~~related~~balance ~~party~~owed ~~has~~on ~~set no specified return date after~~ the ~~increased~~note ~~share~~was ~~authorization~~$398,793 ~~and may make the election~~ at ~~their~~September ~~discretion. The value of the 18~~30,~~000,000~~ ~~shares~~2019 isand ~~determined~~June ~~according to ASC 480~~30, ~~“Distinguishing Liabilities from Equity”~~2019. The OnCompany ~~the~~has ~~return~~been ~~date~~unable ~~of the shares~~ to ~~the~~make ~~Company~~its ~~the~~monthly ~~shares~~payments ~~were~~since ~~valued~~November at2013, ~~the~~and ~~market~~has ~~value.~~been Onin ~~each~~default ~~subsequent~~since ~~period~~that ~~measurement~~time. ~~closing,~~The ~~the~~equipment ~~shares~~has ~~will~~been bereturned ~~valued~~to at the ~~current~~vendor ~~market~~for ~~price~~sale and ~~any~~remains ~~increase~~unsold inat ~~valuation~~September ~~from~~30, ~~the~~2019. ~~initial~~Interest ~~valuation will be recorded as a designated interest~~ expense. ~~Any~~for ~~decrease in valuation from~~ the ~~initial~~three ~~valuation~~months ~~will~~ended beSeptember ~~recorded~~30, to2019 ~~Addition~~and ~~Paid~~2018 inwas ~~Capital~~$5,733, ~~as the obligation is to a related party of the Company~~respectively. ~~The~~Accrued ~~initial~~interest ~~valuation~~ on ~~August~~the 9,note ~~2017 was $1,762,200 and~~ at ~~March~~September 3130, 2019 and June 30, ~~2018~~2019 was $0116,351 and $1110,~~638~~618,~~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. 15

~~NOTE~~Note ~~7 – NOTES PAYABLE~~Payable

~~Pursuant~~An toindividual ~~Share~~during ~~Exchange Agreement (~~the ~~"Share~~prior ~~Exchange~~fiscal ~~Agreement")~~year ~~with~~loaned ~~Canarc~~Company ~~Resource Corp.~~$239,750 aof ~~British~~which ~~Columbia, Canada corporation whose common shares are listed on~~ the ~~TSX~~Company ~~Exchange~~paid ~~under~~back ~~the~~$40,000 ~~symbol~~during ~~CCM~~that ~~("Canarc")~~current onfiscal ~~July~~year ~~15, 2014, the Company~~ and ~~Carnac entered into an interim financing facility pursuant to which Canarc advanced a~~ $~~200~~40,000 ~~loan~~was topaid ~~the~~back ~~Company~~during ~~and~~the acurrent ~~$20,000 merger advance~~quarter. The loan ~~bears~~is ~~interest~~at an ~~initial~~annual ~~compounded~~interest rate of 16%, ahas ~~month~~no ~~and~~stated ~~was~~ due date and is payable ~~upon~~on ~~the~~demand ~~closing of a gold bond financing~~ by the ~~Company~~lender. orAccrued ~~January~~interest ~~15,~~on ~~2015, if~~ the ~~financing~~loan ~~does~~at ~~not~~September ~~close.~~30, ~~The~~2019 ~~financing~~and ~~did~~June ~~not~~30, ~~close~~2019 ~~under~~was ~~this~~$10,531 ~~Agreement~~ and ~~the~~$7,793, ~~accrued~~respectively. ~~compounded~~Interest ~~interest~~expense aton ~~that date was added to~~ the ~~principle~~loan ~~and~~for the ~~interest~~ ~~rate~~three ~~was~~months ~~increased~~ended toSeptember ~~14%~~30, ~~per~~2019 ~~annum~~and on2018 ~~the~~is ~~outstanding~~$2,738 ~~balance~~and ~~per~~$0, ~~the Share Exchange Agreement~~respectively.

In December 2016 the court administered trust paid $9,897 to the note holder and was applied against the accrued interest on the note and was recorded as a gain on trust debt forgiveness.

The following summarizes notes payable:		September 30,		June 30,
		2019		2019
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		159,750		199,750
Notes payable - current	$	558,543	$	598,543

ANOTE ~~forbearance~~7 ~~agreement~~– FAIR byVALUE 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.MEASUREMENTS

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

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.

12NOTE 8 – CONTINGENCIES AND COMMITMENTS

~~The~~Billali 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 atJim ~~other~~Crow/Imperial ~~points~~Mines 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: Project

March 31, 2019

Level 1

Level 2

Level 3

Total

Assets:

None

—

Liabilities:

Share redemption to related party

—

The Company determined the Agreement on the Billali and Jim Crow/Imperial mines is effectively a lease and is cancellable at any time by the Company. Costs of mineral lease renewals, exploration, carrying and retaining unproven mineral lease properties are expensed as incurred. The Company expenses all mineral exploration costs as incurred as it is still in the exploration stage. If the Company identifies proven and probable reserves in its investigation of its properties and upon development of a plan for operating a mine, it would enter the development stage and capitalize future costs until production is established. The Company can cancel the Agreement at any time as detailed in the Agreement.

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

As of September 30, 2019, the Company has not established the commercial feasibility of any of our exploration projects; therefore, all exploration costs are being expensed. In the three months ended September 30, 2019, we paid and capitalized $200,000 under the Agreement. Acquired mineral rights are considered tangible assets under ASC 930-805. As a result, the direct

~~NOTE 9 – CONTINGENCIES AND COMMITMENTS~~16

~~Commodity~~costs ~~Supply~~to ~~Agreement~~ acquire mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with acquiring patented and unpatented mining claims

InPayments ~~December~~under ~~2009,~~ the ~~Company~~Amended ~~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~~No. ~~Under the agreement the Company received advances of $~~4~~,000,000~~ asdated aneffective ~~upfront~~October ~~deposit~~7, ~~plus continue to receive future ongoing payments equal to the lesser of: $400 per ounce or the prevailing market price~~2020, ~~(the~~on ~~“Fixed Price”) for each ounce of gold delivered pursuant to~~ the ~~agreement~~Billali ~~for the life of the mine. The Company purchases~~ and ~~delivers~~Jim ~~refined~~Crow/Imperial ~~gold~~project 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~~follows: ~~Costs - Commodity Supply Agreements.~~

~~Under~~The ~~the~~Total ~~Gold~~Purchase ~~Stream~~Price ~~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~~10, ~~respectively~~000,000 inwill ~~accrued liabilities net of the Fixed Price of $400 per ounce to~~ be ~~received~~paid ~~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.~~follows:

(i)Six Hundred Thousand Dollars ($600,000) has been paid by Buyer to Seller as of the date of this Amendment.

(ii)Commencing November 1, 2020 and continuing on the first day of each subsequent month thereafter, a monthly payment of $25,000 will be paid until (A) the mill processing plant to create concentrate is in operation and (B) we received our first payment for shipment of such concentrate from the mill (satisfaction of these two items is referred to as “Milestone”). Upon satisfaction of this Milestone and commencing on the first day of the following month and continuing the first day of each subsequent month thereafter, Buyer will pay to Seller the sum of Fifty Thousand Dollars ($50,000) until a total of One Million Six Hundred Thousand Dollars ($1,600,000 is paid.

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

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

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~~Rent expense totaled $41,500 for the ~~nine~~three months ended ~~March~~September 3130, 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.

13NOTE 9 - STOCKHOLDERS' DEFICIT

~~NOTE~~Common ~~10-~~Stock ~~STOCKHOLDERS' DEFICIT~~Transactions

~~Stock~~For ~~Returned,~~the ~~Cancelled~~three ~~and~~months ~~Reissued~~ended September 30, 2019:

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.

	(i)	Issued 181,466 shares of restricted common stock for consulting services at a value of $15,279 on the date of issuance;
	(ii)	Issued an aggregate of 12,285,714 shares of restricted common stock to accredited investors for cash proceeds of $860,000.

~~Increased~~Stock ~~Authorization~~Warrants ~~of Common Shares~~

AtDuring the ~~shareholders~~three ~~meeting~~months ~~held~~ended onSeptember ~~January 11~~30, 2019, ~~in Albuquerque, New Mexico, and a majority of our shareholders voted to amend our certificate of incorporation to increase~~ the ~~authorized~~Company ~~shares~~issued ofno ~~common~~new ~~stock~~warrants ~~that~~and weno ~~have~~warrants ~~authority to issue from 300,000,000 shares to 550,000,000 shares~~expired.

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~~three months ended ~~March~~September 3130, 2019, ~~15,000,000~~the ~~options~~Company ~~were~~ granted tono ~~each~~new ~~of two directors for their efforts to revive the Company. The~~ options ~~have a five (5) year life~~ and anno ~~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:~~17

	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 option and warrant activity, for the three months ended September 30, 2019, are as follows:

	Stock Options		Stock Warrants
		Weighted		Weighted
		Average		Exercise
	Shares	Price	Shares	Price
Outstanding at June 30, 2019	30,100,000	$0.05	100,000	$0.15
Granted	—	—	—	—
Canceled	—	—	—	—
Expired	—	—	—	—
Exercised	—	—	—	—
Outstanding at September 30, 2019	30,100,000	$0.05	100,000	$0.15

Stock options and warrants outstanding and exercisable at ~~March~~September 3130, 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	.26	$	0.07	$	0.15	100,000	100,000	3.21	$	0.15
$0.07	100,000	100,000	.76	$	0.07
$0.05	30,000,000	30,000,000	4.47	$	0.05		—	—	—	—		—
	200,000	200,000						4,420,000	4,420,000
	30,100,000	30,100,000						100,000	100,000
	Outstanding Options		4.9646	$	0.05		Outstanding Warrants			3.3421	$	0.15
	Exercisable Options		4.9646	$	0.05		Exercisable Warrants			3.3421	$	0.15

As of ~~March~~September 3130, 2019, the aggregate intrinsic value of all stock options and warrants vested was $~~150~~992,~~000~~300. The intrinsic value of each option 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~~083 closing stock price of the common stock on ~~March~~September 3130, 2019.

The total intrinsic value associated with options exercised during the ~~nine~~three months ended ~~March~~September 3130, 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 1110 – RELATED PARTY TRANSACTIONS

InOn ~~order~~August to1, ~~expedite~~2015, ~~purchases of equipment and associated expenses in Silver City on behalf of~~ the Company, ~~SFG~~leased ~~deposited funds into Mr. Laws certified public accounting practice account until~~ a ~~new~~home ~~bank~~office ~~account~~space ~~was~~from ~~opened~~the ~~at Wells Fargo.~~ Company’s ~~expenses~~CFO ~~and~~for ~~purchases of equipment were done in that account. During the fiscal year 2017 an aggregate of~~ $~~926,000~~500 ~~was~~a ~~deposited to~~month ~~Mr.~~for ~~Laws account or was paid out of~~ the corporate ~~account~~administrative atoffice ~~Mr.~~in ~~Law’s direction. At the end of the 2017 fiscal year Mr. Laws submitted expenditures on behalf of the Company totaling $1~~Albuquerque,~~009,099.~~ ~~Subsequent~~NM tountil ~~the~~such ~~2017~~time ~~fiscal~~growth ~~year~~requires ~~ended, the board directors of the Company appointed~~ a ~~special~~larger ~~committee~~corporate ~~which~~administrative ~~determined the funds expended by Mr~~office. ~~Laws~~Rent ~~were~~expense ~~misappropriated~~for in the ~~amount~~three ofmonths ~~$971,099~~ended ~~and~~September ~~a deposit of $38~~30,~~000~~ ~~was~~2019 ~~valid~~ and ~~refunded~~2018 towas ~~the Company in a subsequent period. Of this amount, the~~ $~~500~~1,~~000~~500 ~~deposit that was to be made on the Alhambra Acquisition was subsequently determined never made the sellers~~respectively. ~~See NOTE 13 - Subsequent Events, Misappropriated Funds and Entry into a Material Definitive Agreement.~~

~~Prior~~The toboard ~~becoming~~authorized aon ~~staff~~June ~~member~~16, of2016, the ~~Company~~hiring of Nataliia Mueller, ~~Mr.~~wife ~~Laws~~of ~~our~~the ~~CEO~~Company’s CFO, ~~received~~with a ~~consulting~~current ~~fee~~annual ~~and~~wage ~~converted~~of on$60,000 ~~January~~as 1,an ~~2018,~~assistant to athe ~~full staff member~~CFO.

AsDuring ~~disclosed in~~ the ~~Company’s~~fiscal ~~Form~~year ~~8-K~~ended ~~filed~~June ~~on October 1~~30, ~~2018~~2019, athe ~~director~~CFO ~~and~~for ~~former~~the ~~chief~~Company ~~executive~~loaned ~~officer of~~ the Company $10,000 ~~Mr.~~and ~~Thomas~~deferred H.net ~~Laws,~~salary ~~entered~~aggregating $51,848 into a ~~secured~~note ~~promissory~~at ~~note~~6% ~~and~~per ~~security~~annum ~~agreement~~and induring the ~~principal~~quarter ~~amount~~ended ofSeptember ~~$930~~30,~~000~~ in2019, ~~favor~~loaned ofan ~~the~~additional ~~Company on September 19~~$10,000. ~~2018,~~Accrued ~~bearing~~ interest aton the ~~annual~~note ~~rate~~at ofSeptember 4%30, 2019 and ~~maturing~~June ~~September~~ 30, ~~2018~~2019, ~~(“Secured~~was ~~Promissory~~$2,680 ~~Note”). The~~and ~~Company~~$1,650, ~~requested~~respectively. ~~the~~Interest ~~former~~expense ~~chief~~on ~~executive~~the tonote ~~execute~~for the ~~Secured~~three ~~Promissory~~months ~~Note~~ended ~~and~~September ~~security~~30, ~~agreement~~2019 asand a2018 ~~result~~was of$1,029 ~~the~~and ~~matters discussed below~~$0, ~~prior to the completion of the special committee investigation~~respectively. The ~~security~~loan ~~interests~~has ~~include~~no ~~certain~~stated ~~real~~due ~~estate~~date and ais ~~Cessna~~payable ~~model~~on ~~182G~~demand ~~airplane~~by the lender. The ~~Secured~~combined ~~Promissory~~loan ~~Note~~and ~~also~~interest ~~contains~~balance ~~late~~at ~~fee~~September ~~and~~30, ~~default~~2019 ~~provisions~~and ~~under~~June ~~the~~30, ~~deeds~~2019 ofwas ~~trust~~$74,528 ~~Security Agreement~~ and ~~other~~$63,499, ~~agreements~~respectively.

~~The~~Transactions ~~board~~involving ofrelated ~~directors~~parties ~~formed~~cannot abe ~~special~~presumed ~~committee on September 26, 2018~~ to ~~investigate~~be ~~and~~carried ~~analyze~~out ~~certain~~on ~~financial~~an ~~transactions~~arm's-length inbasis, as the ~~aggregate~~requisite ~~amount~~conditions 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~~competitive,~~197,198,~~ ~~excluding~~free-market ~~penalty,~~dealings ~~accrued~~may ~~interest~~not ~~and additional associated costs~~exist. AtRepresentations ~~the~~about ~~time~~transactions ~~of filing this Form 10-Q total costs associated~~ with ~~Mr.~~related ~~Laws is $1~~parties,~~651,263,~~ ~~including~~if ~~the additional incurred associated costs~~made, ofshall ~~which $485,966 has been recovered by the Company from Mr. Laws. The Company does~~ not ~~anticipate~~imply ~~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.~~ 18

15that the related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated.

~~Subsequent~~NOTE ~~review~~11 of– LEGAL ~~these~~PROCEEDINGS ~~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~~September 3130, 2019 and June 30, ~~2018~~2019 was $2630,~~264~~436 and $2028,~~019,~~339 respectively. Interest ~~expense~~ on the obligation for the ~~nine~~three months ended ~~March~~September 3130, 2019 and 2018 was $62,~~245~~097 ~~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~~During ~~Company accrued back interest on judgement during~~ the ~~quarter~~three months ended ~~December~~September 3130, ~~2016,~~2019 ofand ~~$26~~2018,~~875.~~ InCompany ~~December~~interest ~~2016~~on the ~~court~~obligation ~~administered~~was ~~trust paid~~ $42,~~591~~554, torespectively. ~~Wagner~~Accrued ~~equipment and was applied against the accrued~~ interest on the obligation ~~and~~at ~~was~~September ~~recorded~~30, as2019 aand ~~gain~~June on30, ~~trust~~2019 ~~debt~~was ~~forgiveness.~~$50,125 ~~During~~and ~~the nine months ended March 31~~$47,571, respectively.

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~~In ~~Department~~November of2017, ~~Justice~~the ~~(“DOJ”)~~Company ~~and~~entered ~~the~~into ~~U.S.~~substantially ~~Securities~~identical ~~and~~agreements ~~Exchange~~with ~~Commission~~Fortune ~~(“SEC”)~~Graphite, ~~have~~Inc. ~~each~~and ~~initiated~~Worldwide ~~investigation~~Graphite ~~into~~Producers, ~~the~~Ltd. ~~Company~~to ~~and~~acquire ~~certain~~a ~~other~~total ~~individuals,~~of ~~resulting~~four ~~from~~placer ~~the~~claims ~~Laws~~for ~~transactions~~aggregate consideration of Can$400,000 and ~~related~~the ~~misappropriation~~issuance of ~~funds~~10,000,000 ~~described~~shares ~~herein~~of Company common stock. The ~~SEC~~Company ~~has~~owes ~~obtained~~the asellers ~~formal~~Can$140,000 ~~order~~and to10,000,000 ~~investigate~~shares ~~the~~of Company common stock. ~~The~~To ~~DOJ~~date, ~~investigation~~the isCompany ~~still~~has ~~preliminary~~paid Can$260,000. The ~~These~~Company ~~types~~owes ofthe ~~investigations~~sellers ~~are~~Can$140,000 ~~expensive~~and 10,000,000 ~~time-consuming~~shares ~~for~~of ~~management,~~Company ~~and~~common ~~unpredictable~~stock. Based ~~– often~~upon ~~resulting~~our insubsequent ~~other~~scrutiny ~~aspects~~and analysis of the transaction, the Company’s ~~operations~~in ~~becoming~~February ~~subject~~2019 initiated an arbitration proceeding against the seller to ~~regulatory~~void ~~scrutiny~~and rescind the purchase of these British Columbia properties, including requesting additional remedies. ~~These~~The ~~investigations~~Company ~~are~~cannot ~~ongoing~~predict ~~and~~the nooutcome ~~prediction~~of this arbitration, and there can be ~~made~~no ~~regarding~~assurance that the ~~timing~~Company will not lose its interest in these claims, or ~~outcome~~owe ofseller ~~such~~the ~~matters~~remaining ~~including~~outstanding ~~remedial~~amounts. ~~action~~In ~~pursued~~connection ~~against~~with this arbitration, the Company’s legal position is to void the transaction and, ~~others~~due to the uncertainty of the outcome, ~~including~~has ~~its~~provided ~~officers~~an ~~and~~impairment ~~directors~~of the amount at June 30, 2019, in the amount of $210,116.

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 for misappropriation of Company funds, 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.

Subsequent professional costs including legal, auditing, forensic accounting and related filing costs related to this event have been added to the amounts owed by Mr. Laws. At the time of filing this report, we have determined costs associated with Mr. Laws action currently aggregates $1,651,263, of which we have collected $485,966 as of the date of filing this report.

As of the filing of this report, Mr. Laws has pleaded guilty to various charges brought against him by the U. S. District Attorney for the District of New Mexico , 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 and the Company does not anticipate receiving a substantial reimbursement of the remaining Laws costs.

The Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) have each initiated investigation’s 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~~September 3130, ~~2018~~2019, 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 1312 – SUBSEQUENT EVENTS

Recent Issuances of Unregistered Securities

In the period from ~~April~~October 1, 2019 through ~~August~~October 14, 2020, the Company sold an aggregate of 4624,~~775~~107,~~910~~143 restricted shares of common ~~shares~~stock to ~~ten~~nine existing accredited ~~shareholders and two new accredited~~ investors ~~and~~for ~~the~~cash ~~Company received aggregate~~ proceeds of $21,~~893~~482,~~980~~500. ~~from~~During ~~these~~this ~~sales.~~period Inthe ~~addition,~~Company ~~our~~sold ~~chairman~~an ~~purchased~~aggregate 7of 6,~~892~~642,858 restricted ~~common~~ shares ~~for $475,000. The issuance~~ of ~~the restricted~~ common ~~shares,~~stock ~~were~~to ~~exempt~~the ~~from~~chairman ~~registration requirements~~ of the ~~Security~~board ~~Act~~for ofcash ~~1933,~~proceeds ~~as amended~~$375, ~~pursuant to Section 4(a)2, thereof because such issuance did not involve a public offering~~000. ~~In connection with the placements, the Company incurred no consulting fees.~~

~~During~~In the period ~~April~~from ~~2019~~March 2020 through ~~August~~October 14, 2020, the Company issued ~~restricted~~warrants ~~2,656,884~~to ~~shares~~existing ofaccredited investors ~~common~~aggregating ~~stock~~6,541,667, ~~for~~and ~~consulting services at an aggregated market value of $237~~2,~~381~~250,000 onwarrants to the ~~date~~chairman of ~~issuance. The issuance of~~ the ~~restricted~~board ~~common~~that ~~shares,~~ were ~~exempt~~attached ~~from~~to ~~registration~~restricted ~~requirements~~stock ofpurchases. ~~the~~The ~~Security~~warrants ~~Act~~were ofvested ~~1933~~at issuance, ashave ~~amended,~~a ~~pursuant~~two toor ~~Section~~three-year ~~4(a)2,~~life ~~thereof~~and ~~because~~an ~~such~~exercise ~~issuance~~price ~~did~~of ~~not~~$0.05 ~~involve~~to a$0.07 ~~public~~per ~~offering~~share.

InDuring the period from ~~April~~October 1, 2019 through ~~August~~October 14, 2020, the Company issued ~~warrants to accredited investors aggregating 4~~797,~~500,000,~~517 ~~and~~restricted ~~2,250,000~~shares ~~warrants to the chairman~~ of ~~the~~common ~~board that were attached to restricted~~ stock ~~purchases.~~for ~~The~~consulting ~~warrants~~services ~~were vested~~ at ~~issuance, have~~ a ~~three-year~~market ~~life~~value ~~and an exercise price~~ of $~~0.05~~62,707 ~~and~~on ~~$0.07~~the ~~per~~date ~~share~~of issuance.

On April 10, 2020, the Company converted $100,000 of accrued salary for the Company’s CFO into 2,000,000 shares of restricted common stock at a market value of $117,000 on the date onof 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.

17On June 30, 2020, the Company converted a note payable with the Company’s CFO consisting of principal and interest of $42,037 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 $19,286. In conjunction with the conversion, 482,149 vested three-year warrants were granted and have an exercise price of $0.05 per share.

On ~~June~~August 307, 2020, ~~the~~former ~~Company~~Chief ~~converted~~Financial aOfficer ~~note~~(“CFO”) ~~payable~~of ~~with~~ the Company ~~CFO~~resigned ~~consisting~~from ofthat ~~principal~~position. As ~~and~~the ~~interest~~former ofCFO ~~$42,036~~has ~~and~~significant ~~$6,178,~~institutional ~~respectively,~~knowledge ~~into~~and ~~964,299~~background ~~shares~~Company ofknowledge, ~~restricted~~the ~~common~~Board ~~stock~~offered atthe ~~$0.05~~individual ~~per share. The market value on~~ the ~~date~~position of ~~conversion~~Managing ~~was~~Director ~~$67,501 and on the date~~ of ~~conversion~~Mining ~~the~~Operations ~~Company~~with ~~recorded~~ a ~~loss~~signing onbonus ~~debt conversion~~ of $1920,~~287.~~000 Inand ~~conjunction with the conversion 482~~750,~~149~~00 ~~vested~~shares ~~three-year~~of ~~warrants~~restricted ~~were~~common ~~granted~~stock and ~~have~~ an ~~exercise~~employment ~~price~~agreement ofwas $0signed.~~05 per share.~~

~~Alhambra~~Miscellaneous ~~Acquisition~~Events

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 3118, ~~2018. If any payment is not timely paid~~2019, 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 agreementMr. WeDaniel ~~paid $100~~Gorski,~~000~~ inour ~~November~~consultant ~~2018 with respect to the Alhambra Silver Mine acquisition and owed a balance of approximately $250~~geologist,~~000~~ onwas ~~December~~appointed ~~31, 2018,~~ to ~~complete~~our ~~the~~board ~~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 $3,115,365directors.

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.20

~~British~~As ~~Columbia~~of ~~Properties~~filing of this report, the Company has determined that Mr. Laws owes the Company $1,651,263, net of funds recovered from Mr. Laws of $485,966. This amount represents an increase consisting of legal, forensic accounting services incurred by the Company and the audit restatement of our fiscal year 2017 that was attributable the misappropriation of funds. The current amount does not include any penalties or interest as provided in the secured promissory note and security agreement signed by Mr. Laws. The Company does not anticipate collecting a material amount due from Mr. Laws and any recovery will be determined by the bankruptcy court.

OnAs ~~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~~filing of ~~10,000,000~~this ~~shares of Company common stock. Title to these claims remained in trust with the sellers until payment in full. To date~~report, ~~the Company has paid to the sellers’ consideration of Can$260,000~~Mr. ~~The~~ ~~Company~~Laws 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~~pleaded ~~British~~guilty ~~Columbia counsel~~ to ~~review~~various ~~the~~charges ~~two~~brought ~~November~~against ~~2017~~him ~~agreements and has concluded that there were false representations made~~ by ~~the~~government ~~sellers and that certain conditions precedent of sellers were not satisfied. As a result~~officials, ~~the~~which ~~Company’s~~include ~~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~~allegations. ~~The~~ ~~Company continues to evaluate its rights and remedies in connection with this matter~~Mr. As aLaws ~~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~~currently ~~fully~~awaiting ~~set~~sentencing ~~forth~~on in the ~~Form~~charges ~~8-K~~he ~~filing~~plead ~~dated November 20, 2018)~~to. AtThe ~~the~~Company ~~time~~attorneys ofhave ~~the~~filed ~~filing~~all ofrequired ~~this~~documents ~~report~~for ~~the~~future ~~agreements~~monetary ~~are~~settlements ~~being~~to ~~scheduled~~be ~~for~~determined ~~arbitration~~ by the ~~Company attorney~~court. ~~At June 30, 2019, the Company impaired the investment in the amount of $210,116.~~

~~Misappropriation~~Effective ofJuly ~~Funds~~7, ~~and~~2020, ~~Entry~~the ~~into~~Company retained a ~~Material~~new ~~Definitive~~Chief ~~Agreement~~Financial Officer and an employment agreement was signed.

AsThe ~~disclosed in the~~ Company’s ~~Form~~signed ~~8-K~~employment ~~filed~~agreements onwith ~~October~~the 1,new ~~2018,~~Chief aFinancial ~~director~~Officer and ~~former~~Managing ~~chief~~Director ~~executive officer~~ of ~~the~~Mining ~~Company, Mr~~Operations. ~~Thomas~~The H.agreements ~~Laws,~~are ~~entered into~~ a ~~secured~~one-year ~~promissory~~employment ~~note and security~~ agreement inwith the ~~principal amount of $930,000 in favor of the~~ Company ~~on September 19~~, ~~2018,~~with ~~bearing~~automatic ~~interest~~successive atone-year ~~the~~renewals ~~annual~~provided ~~rate~~that ~~of 4% and maturing September 30, 2018 (“Secured Promissory Note”).~~neither ~~The~~party ~~Company~~has ~~requested~~provided ~~the~~notice ~~former chief executive to execute the Secured Promissory Note and security agreement as a result~~ of ~~the~~termination ~~matters discussed below,~~ prior to ~~the~~30 ~~completion~~days offrom the ~~special~~end ~~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,~~such ~~Security~~applicable ~~Agreement and other agreements~~term.

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.

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~~In ~~Form~~addition ~~10-Q~~to ~~contains~~historical ~~certain~~financial ~~“forward-looking”~~information, ~~statements~~the asfollowing ~~such~~discussion ~~term~~and isanalysis ~~defined~~contains byforward-looking ~~the~~statements ~~Securities~~that ~~and~~involve ~~Exchange Commission in its rules~~risks, ~~regulations~~uncertainties and ~~releases,~~assumptions. ~~which~~See ~~represent~~“Cautionary ~~the~~Statement ~~Company’s~~on ~~expectations~~Forward-Looking orStatements.” ~~beliefs,~~Our ~~including~~results ~~but~~and ~~not~~the ~~limited~~timing ~~to,~~of ~~statements~~selected ~~concerning~~events ~~the~~may ~~Company’s~~differ ~~strategy,~~materially ~~operations,~~from ~~economic~~those ~~performance,~~anticipated ~~financial~~in ~~condition,~~these ~~resource~~forward-looking ~~drilling~~statements ~~strategies,~~as ~~investments,~~a ~~and~~result ~~future~~of ~~operational~~many ~~plans. For this purpose~~factors, ~~any~~including ~~statements~~the ~~contained~~risk ~~herein~~factors ~~that~~described ~~are~~in ~~not~~this ~~statements~~report ofand ~~historical~~in ~~fact~~“Item ~~may~~1A. beRisk ~~deemed~~Factors” toin beour ~~forward-looking~~Annual ~~statements.~~Report ~~Without~~on ~~limiting~~Form ~~the~~10-K ~~generality~~for of the ~~foregoing,~~fiscal ~~words~~year ~~such~~ended asJune ~~“may~~30,” 2019.

19Overview

~~“will,”~~We “expect,” “believe,” “anticipate,” “intent,” “could,” “estimate,” “might,” “plan,” “predict” or “continue” or the negative or other variations thereof or comparable terminology are ~~intended~~an toexploration ~~identify~~company ~~forward-looking~~that ~~statements.~~owns ~~This~~certain ~~information~~mining ~~may involve known~~ and ~~unknown~~mineral ~~risks,~~rights ~~uncertainties~~at ~~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~~Alhambra-~~looking~~Blackhawk ~~statements.~~project ~~This~~and ~~Form~~have 10right-~~Q contains forward~~of-~~looking~~use ~~statements,~~mineral ~~many~~rights ~~assuming~~comprising ~~that~~ the ~~Company~~Billali ~~secures adequate financing~~ and isJim ~~able~~Crow-Imperial tomine ~~continue~~project asin asouthwest ~~going~~New ~~concern, including statements regarding, among other things: our ability to continue as a going concern;~~Mexico.

~~•exploration~~During ~~for~~the ~~minerals~~three-months isended ~~highly~~September ~~speculative~~30, ~~and~~2019, ~~involves~~the ~~greater~~Company ~~risk~~focused ~~than~~primarily ~~many~~on ~~other~~repair ~~businesses;~~and asimprovement ~~such,~~projects ~~most~~at ~~exploration~~the ~~programs~~Jim ~~fail~~Crow tomine ~~result~~site inand ~~the~~initiated ~~discovery~~our oflimited ~~economic~~exploratory ~~mineralization;~~ program at the mine site.

•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.

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. AsShould athe ~~result~~Company ofbe ~~these~~unable ~~circumstances,~~to ~~management~~continue ~~concluded~~as ~~that~~a ~~there~~going isconcern, ~~substantial~~it ~~doubt~~may ~~regarding~~be unable to realize the ~~Company’s~~carrying ~~ability~~value toof ~~continue~~its asassets aand ~~going~~to ~~concern~~meet asits itliabilities isas ~~currently~~they ~~structured~~become due.

The ~~future~~Company has recorded a net loss of $735,985 for the ~~Company~~three ismonths ~~discussed~~ended inSeptember ~~the~~30, ~~10-K~~2019, ~~filings~~and ~~for~~has ~~the~~a ~~fiscal~~total ~~year~~accumulated ~~ended~~deficit ~~June~~of $94,214,655 and a working capital deficit at September 30, ~~2017~~2019 of $4,384,295. The Company used in operating activities, approximately $469,000. The Company currently has no source of generating revenue.

~~Santa~~To Fecontinue ~~Gold~~as ~~Corporation~~a ~~(“Santa~~going ~~Fe”~~concern, "the Company”, ~~“our”~~is ordependent ~~“we”)~~on iscontinued acapital ~~U.S.~~financing ~~mining~~for ~~company~~project development, ~~incorporated~~repayment inof ~~1991~~various indebt ~~the~~facilities ~~state~~and payment of ~~Delaware~~current operating expenses until the Company has put into production, an acceptable source to generate mineralized ore to generate a revenue stream. ~~Our~~Currently ~~general~~we ~~business~~have ~~strategy~~no iscommitment from any party to ~~acquire~~provide ~~explore,~~additional ~~develop~~working capital and tothere ~~create~~is ~~shareholder~~no ~~value~~assurance that any funding will be available as required, or if available, that its terms will be favorable or acceptable to the Company.

~~The~~At ~~Company~~September ~~has~~30, ~~recorded a loss of $2~~2019,~~688,790~~ or the ~~nine~~Company ~~months~~was ~~ended~~in ~~March~~default ~~31,~~on ~~2019,~~delinquent ~~and~~payments ~~has~~of aapproximately: ~~total~~$3.04 ~~accumulated~~million ~~deficit~~on ofaccounts payable, $~~104~~398,~~702,164~~000 ~~and~~on a ~~working~~note ~~capital~~payable ~~deficit~~and ~~at March 31, 2019, of~~ $16643,~~337,401.~~000 ~~The~~on ~~Company~~other ~~currently~~accrued ~~has no source of generating revenue~~liabilities.

ToThe ~~continue~~unaudited asconsolidated afinancial ~~going~~statements ~~concern,~~do ~~the~~not ~~Company~~include isany ~~dependent~~adjustments onrelating ~~continued~~to ~~capital~~the ~~financing~~recoverability ~~for project development, repayment of various debt facilities~~ and ~~payment~~classification of ~~current~~asset ~~operating~~amounts ~~expenses~~or ~~until~~ the ~~Company~~classification ~~has~~of ~~acquired~~liabilities ~~new~~that ~~mining~~might ~~claims~~be ~~and~~necessary anshould ~~acceptable source to process~~ the ~~mineralized~~Company ~~ore~~be tounable ~~generate revenue. We have no commitment from any party~~ to ~~provide~~continue ~~additional working capital and there is no assurance that any funding will be available~~ as ~~required,~~a orgoing ~~if available, that its terms will be favorable or acceptable to the Company~~concern.

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

asThe aresults ~~designated~~of ~~interest~~operations ~~expense.~~in ~~Any~~the ~~decrease~~past inreflected ~~valuation~~a ~~from~~continued ~~the~~under-capitalization ~~initial~~of ~~valuation~~our ~~will~~projects which required additional funding to be ~~recorded~~able to ~~Addition~~achieve ~~Paid~~full inproject ~~Capital~~performance asand ~~the~~sustained ~~obligation~~potential isprofitability. We currently are dependent on additional financing to aresume ~~related~~any ~~party~~mining ofoperations and to continue our exploration efforts in the ~~Company~~future as warranted.

Operating Results for the ~~Nine~~Three Months Ended ~~March~~September 3130, 2019 and 2018

~~Sales, net~~ Revenue

During the ~~nine~~three months ended ~~March~~September 3130, 2019 and 2018, the Company had no revenue in the periods of ~~measurements~~measurement.

Operating Costs and Expenses

Our operating ~~cost~~expenses incurred in ~~nine~~three months ended ~~March~~September 3130, 2019, increased $1448,~~142,657~~972 from $1300,~~251,753~~402 in the ~~nine~~three months ended ~~March~~September 3130, 2018, to $2749,~~394,410~~374 for the current period of measurement. The ~~increase~~increases in operating ~~costs~~expenses in the current period of measurement is ~~mainly~~ attributable to increased exploration and mine related costs of $270,228, and increased general and administrative of $1172,~~140~~074 and an increase in depreciation of $6,~~164~~670.

The ~~increases~~increase in ~~general~~exploration and ~~administrative~~mine inrelated costs were incurred on the ~~current~~Jim ~~period~~Crow mine and consisted of ~~measurement~~$156,470 ~~are~~in ~~mainly~~wages ~~attributable~~and topayroll ~~increases~~burden incosts ~~legal~~and ~~fees~~other mine related costs of $~~104~~113,~~188~~758. ~~and~~The aincrease ~~non-cash~~in ~~cost~~general ofand ~~options~~administrative ~~issued~~of ~~aggregating~~ $1172,~~497,985.~~074 ~~These~~was ~~increases~~mainly ~~were~~attributable to decreased consulting fees related to working capital raises of $62,803 and offset by ~~decreases~~an inincrease ~~salary~~accounting ~~burden~~and audit fees of $42175,~~957~~666, legal fees of $35,871 and ~~consulting~~salaries ~~fees~~and payroll burden costs of $~~418~~14,~~695~~714.

Other Income (Expense)

Other income ~~(expense)~~ for ~~nine~~the three months ended ~~March~~September 3130, 2019, was $~~(294~~13,~~380)~~389 as compared to $(1446,~~435,327)~~694 for ~~nine~~three months ended ~~March~~September 3130, 2018, a decrease in other ~~expense~~income of $1433,~~140,947~~305. The net decrease in other ~~expenses~~income for the current period of measurement is mainly comprised of ~~decreased losses in~~ the following income components: ~~misappropriation~~decrease ofin ~~funds of $604,159,~~ financing costs – on commodity supply ~~agreement~~agreements of $~~135~~234,~~939~~417 and ~~interest~~a ondecrease ~~mandatory~~in ~~redemption~~recovery ~~shares~~of a misappropriation of funds aggregating $350,521. These income items were offset by ~~related~~a ~~party~~decrease in interest expense of $~~270~~151,~~000,~~633. The decreased interest expense and afinancing ~~gain~~costs on ~~debt~~commodity ~~extinguishment~~supply agreements are a result of ~~$112~~debt write-off at our fiscal year ended June 30,~~625.~~ 2019.

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

AsThe offinancial ~~March~~statements ~~31,~~have ~~2019~~been prepared on a going concern basis, wewhich ~~had~~contemplates ~~cash~~the realization of ~~$37,977~~assets and wesatisfaction ~~had~~of aliabilities ~~working~~and ~~capital~~commitments ~~deficit~~in the normal course of ~~$16~~business. Should the Company be unable to continue as a going concern,~~337,401~~ it may be unable to realize the carrying value of its assets and to meet its liabilities as they become due.

AtThe ~~March~~Company ~~31,~~has ~~2019,~~recorded ~~the~~a ~~Company~~net ~~was~~loss inof ~~defaults~~$735,985 onfor ~~payments~~the ofthree ~~approximately~~months ~~$7.87~~ended ~~million~~September ~~under~~30, a2019, ~~gold~~and ~~stream~~has ~~agreement~~a ~~(the~~total ~~“Gold~~accumulated ~~Stream~~deficit ~~Agreement”)~~of ~~with~~$94,214,655 ~~Sandstorm~~and ~~Gold~~a ~~Ltd.~~working ~~(“Sandstorm”),~~capital ~~other~~deficit ~~notes~~at ~~payable~~September ~~principle~~30, ~~aggregating~~2019 ~~approximating~~of $24,384,295.38 ~~million,~~The ~~accrued~~Company ~~liabilities~~used ofin operating activities, approximately $2469,000.94 ~~million~~The ~~and~~Company ~~accounts~~currently ~~payable~~has ~~approximating~~no ~~$3.05~~source ~~million~~of generating revenue.

~~The~~To continue as a going concern, the Company ~~upon~~is ~~emergence~~dependent ~~resorted~~on tocontinued ~~selling~~capital ~~equity~~financing for ~~cash~~project sodevelopment, asrepayment toof ~~proceed~~various ondebt ~~reviving~~facilities and payment of current operating expenses until the Company has put into production an acceptable source to generate mineralized ore to generate a revenue stream. Currently we have no ~~continuing~~ commitment from any party to provide ~~necessary~~ additional working capital, orand ifthere ~~one~~is ~~becomes~~no assurance that any funding will be available, ~~there~~as isrequired, noor ~~certainty~~if available, 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.

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~~Evaluation ~~the three months ended March 31, 2019, our management, with the participation~~ of ~~our~~Disclosure ~~Chairman~~Controls and ~~Chief~~Procedures 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.

During the three months ended September 30, 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 September 30, 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 Chairman 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.

At the beginning of the current fiscal year, new formal policies were initiated for review of material transactions by an outside accounting professional with a CPA and CFO background and all disbursements reviewed and approved by the Chairman of the Board. Any discrepancies will be reported directly to the Board of Directors. These policies are intended for multiple reviews on all material transactions and assist in eliminating a material weakness described above.

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~~Generally ~~accepted~~Accepted ~~accounting~~Accounting ~~principles~~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.

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, 2019, 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.

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~~three months ended ~~March~~September 3130, 2019 and 2018,. ~~the~~ Company interest ~~expense~~ on the obligation was $72,~~605~~554, respectively. Accrued interest on the obligation at ~~March~~September 3130, 2019 and June 30, ~~2018~~2019 was $4550,~~045~~125 and $3747,~~440~~571, respectively.

~~The~~In ~~Department~~November of2017, ~~Justice~~the ~~(“DOJ”)~~Company ~~and~~entered ~~the~~into ~~U.S.~~substantially ~~Securities~~identical ~~and~~agreements ~~Exchange~~with ~~Commission~~Fortune ~~(“SEC”)~~Graphite, ~~have~~Inc. ~~each~~and ~~initiated~~worldwide ~~investigation~~Graphite ~~into~~Producers, ~~the~~Ltd. ~~Company~~to ~~and~~acquire ~~certain~~a ~~other~~total ~~individuals,~~of ~~resulting~~four ~~from~~placer ~~the~~claims ~~Laws~~for ~~transactions~~aggregate consideration of Can$400,000 and ~~related~~the ~~misappropriation~~issuance of ~~funds~~10,000,000 ~~described~~shares ~~herein~~of Company common stock. The ~~SEC~~Company ~~has~~owes ~~obtained~~the asellers ~~formal~~Can$140,000 ~~order~~and to10,000,000 ~~investigate~~shares ~~the~~of Company common stock. ~~The~~To ~~DOJ~~date, ~~investigation~~the isCompany ~~still~~has ~~preliminary~~paid Can$260,000. The ~~These~~Company ~~types~~owes ofthe ~~investigations~~sellers ~~are~~Can$140,000 ~~expensive~~and 10,000,000 ~~time-consuming~~shares ~~for~~of ~~management,~~Company ~~and~~common ~~unpredictable~~stock. Based ~~– often~~upon ~~resulting~~our insubsequent ~~other~~scrutiny ~~aspects~~and analysis of the transaction, the Company’s ~~operations~~in ~~becoming~~February ~~subject~~2019 initiated an arbitration proceeding against the seller to ~~regulatory~~void ~~scrutiny~~and rescind the purchase of these British Columbia properties, including requesting additional remedies. ~~These~~The ~~investigations~~Company ~~are~~cannot ~~ongoing~~predict ~~and~~the nooutcome ~~prediction~~of this arbitration, and there can be ~~made~~no ~~regarding~~assurance that the ~~timing~~Company will not lose its interest in these claims, or ~~outcome~~owe ofseller ~~such~~the ~~matters~~remaining ~~including~~outstanding ~~remedial~~amounts. ~~action~~In ~~pursued~~connection ~~against~~with this arbitration, the Company’s legal position is to void the transaction and, ~~others~~due to the uncertainty of the outcome, ~~including~~has ~~its~~provided ~~officers~~an ~~and~~impairment ~~directors~~of the amount at June 30, 2019, in the amount of $210,116.

In ~~accordance~~November ~~with accounting standards regarding loss contingencies~~2018, ~~the~~Santa ~~Company~~Fe ~~accrues~~filed ana ~~undiscounted~~complaint ~~liability~~in ~~for~~Luna ~~those~~County ~~contingencies~~District ~~where~~Court, ~~the~~State ~~incurrence~~ of aNew ~~loss~~Mexico, isrequesting ~~probable~~a ~~and the amount can be reasonably estimated~~$930,000 ~~and~~money ~~the~~judgment ~~Company~~against ~~discloses~~Mr. ~~the amount accrued~~ and ~~the~~Mrs. ~~amount~~Laws offor amisappropriation ~~reasonably possible loss in excess~~ of ~~the~~Company ~~amount accrued~~funds, ifin ~~such~~addition ~~disclosure~~to isforeclosing ~~necessary~~on ~~for~~the ~~its~~mortgage ~~financial~~Mr. ~~statements~~and ~~not to be misleading~~Ms. ~~The~~Laws ~~Company~~granted ~~does~~to ~~not~~Santa ~~record~~Fe ~~liabilities~~on ~~when~~real ~~the~~property ~~likelihood~~to ~~that~~secure the ~~liability~~promissory ~~has~~note ~~been~~located ~~incurred~~in isLuna ~~probable but the amount cannot be reasonably estimated~~County, orNew ~~when the liability is believed to be only reasonably possible or remote~~Mexico.

WeIn ~~are~~November ~~subject~~2018, ~~from~~Santa ~~time~~Fe tofiled ~~time~~a tosimilar ~~litigation~~complaint in Grant County District Court, ~~claims~~State of New Mexico, as Mr. and ~~suits~~Mrs. ~~arising~~Laws inand ~~the~~XYZ ~~ordinary~~Ranch ~~course~~Estates, ofLLC ~~business.~~granted ~~Other~~Santa ~~than~~Fe ~~the~~a ~~above-described~~deed ~~litigation~~of trust and a mortgage, asrespectively, on several pieces of ~~December~~real 31property in Grant County, ~~2018~~New Mexico. Mr. Laws also granted Santa Fe a security agreement on an airplane located in Grant County, weNew ~~were~~Mexico. The ~~not~~complaint in Grant County requested a ~~party~~money tojudgment ~~any~~in ~~material~~the ~~litigation~~amount of $930,000 ~~claim~~against orMr. ~~suit~~and ~~whose~~Mrs. ~~outcome~~Laws, ~~could~~in ~~have~~addition to a ~~material~~request ~~effect~~to foreclose on ~~our~~the ~~financial~~assets ~~statements.~~pledged to us located in Grant County, New Mexico.

~~Because~~Subsequent ~~litigation~~review ~~outcomes~~of ~~are~~these ~~inherently~~transactions ~~unpredictable,~~for the ~~Company’s~~fiscal ~~evaluation~~year ofended ~~legal~~June ~~proceedings~~30, ~~often~~2017, ~~involves~~resulted in a ~~series~~restatement of ~~complex~~assets ~~assessments~~and byoperating ~~management~~costs ~~about~~in ~~future~~the ~~events~~amount ~~and~~of ~~can~~$971,099 ~~rely heavily on estimates~~ and ~~assumptions.~~charged Ifto the ~~assessments~~former ~~indicate~~chief ~~that~~executive ~~loss~~officer. ~~contingencies~~Subsequent ~~that~~professional ~~could~~costs beincluding ~~material~~legal, toauditing, ~~any~~forensic ~~one~~accounting ofand ~~its~~related ~~financial~~filing ~~statements~~costs ~~are~~related ~~not~~to ~~probable,~~this ~~but~~event ~~are~~have ~~reasonably~~been ~~possible,~~added orto ~~are~~the ~~probable,~~amounts ~~but~~owed ~~cannot~~by beMr. ~~estimated,~~Laws. ~~then~~At the ~~Company~~time ~~discloses the nature~~ of ~~the~~filing ~~loss~~this ~~contingencies~~report, ~~together~~we ~~with~~have andetermined ~~estimate~~costs ofassociated ~~the~~with ~~range~~Mr. ofLaws ~~possible~~action ~~loss~~currently oraggregates a$1,651,263, ~~statement~~of ~~that~~which ~~such~~we ~~loss~~have iscollected ~~not~~$485,966 ~~reasonably~~as ~~estimable.~~of ~~While~~ the ~~consequences~~date of ~~certain~~filing this report.

~~unresolved~~other ~~proceedings~~aspects ~~are not presently determinable, and an estimate~~ of the ~~probable~~Company’s ~~and~~operations ~~reasonably~~becoming ~~possible~~subject ~~loss~~to orregulatory ~~range~~scrutiny. These ofinvestigations ~~loss~~are inongoing ~~excess~~and ofno ~~amounts~~prediction ~~accrued~~can ~~for such proceedings cannot~~ be ~~reasonably~~ made, anregarding ~~adverse~~the timing or outcome ~~from~~of such ~~proceedings~~matters ~~could~~including ~~have~~remedial aaction ~~material~~pursued ~~adverse~~against ~~effect on its financial statements in any given reporting period. However, in~~ the ~~opinion~~Company ofand ~~Management~~others, ~~after~~including ~~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~~officers ~~statements.~~and directors.

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 September 30, 2019, we were not a party to any material litigation, claim or suit whose outcome could have a material effect on our 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~~Fiscal ~~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 with on Form 10-K for our year fiscal ended June 30, 2019, in addition to the other information included in this quarterly report. 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~~Between ~~Capital~~July 1, 2019, and ~~Issued~~September ~~Shares~~30, 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 a stock subscription from an existing accredited investor at $0.07 per share for an aggregate of 12,285,714 shares of the Company’s restricted common stock for a total aggregate consideration of $860,000. There were no subsequent or contemporaneous public offerings of common stock by the Company or other securities. The shares of the Company’s restricted common stock were broken down into smaller denominations and gifted to family members. Negotiations for the issuance of the shares took place directly between the investor and the Company.

~~Between~~The ~~January 1~~Company, ~~2019~~on ~~and~~July ~~March~~ 31, 2019, inapproved ~~reliance upon~~ the ~~exemptions~~issuance ~~from registration provided by Section 4(a)(2)~~ of ~~the Securities Act and/or Regulation S promulgated thereunder~~181,466 ~~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 anconsulting ~~aggregate~~fees ~~consideration~~with a value of $~~408~~15,~~000.~~279 ~~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~~date.

~~Effective~~The ~~January~~issuances 12of the restricted common shares during the three months ended September 30, 2019, ~~subscribed~~were ~~shares~~exempt ~~accepted~~from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a) (2) thereof and/or ~~consultant~~Regulation ~~shares~~S ~~granted~~promulgated ~~prior~~thereunder and/or because such issuances did not involve a public offering and/or because such sales were to ~~January~~non-US-persons. ~~12,~~The ~~2019~~cash proceeds were utilized for working capital by the Company. In connection with transactions referenced above, ~~aggregating~~other 39than issuances to the Company’s officers,~~768~~ directors,~~462~~ ~~shares~~employees ofand ~~restricted~~consultants ~~common~~for ~~stock~~services, ~~were~~the ~~issued~~Company toobtained representations from the ~~shareholders~~investor atthat ~~purchase~~(i) such ~~price~~investor ofwas an “accredited investor” within the ~~shares~~meaning ~~and~~of ~~shares~~Rule ~~granted~~501 toof ~~consultants~~Regulation ~~were~~D, ~~issued~~(ii) atsuch ~~their~~investor ~~value~~was onacquiring the ~~date~~securities for its own account for investment and not for the account of ~~grants~~any atother person and not with a ~~total~~view ~~value~~to or for distribution, assignment or resale in connection with any distribution within the meaning of $3the Securities Act,~~289,991.~~ (iii) such investor understands that the purchased securities or shares underlying such securities are subject to

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.

~~ITEM~~transfer 4.restrictions ~~MINE~~under ~~SAFETY~~the ~~DISCLOSURES~~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.

~~Pursuant~~ITEM 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 fatalities3. ~~During~~DEFAULTS ~~the~~UPON ~~fiscal~~SENIOR 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.SECURITIES

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

ITEM 4. MINE SAFETY DISCLOSURES

Pursuant to Section 1503(a) of the Dodd-Frank Act, issuers that are operators, or that have a subsidiary that is an operator of mine in the United States are required to disclose specified information about mine health and safety in their periodic reports. These reporting requirements are based on the safety and health requirements applicable to mines under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”) which is administered by the U.S. Department of Labor’s Mine Safety and Health Administration (“MSHA”). During the three-month period ended September 30, 200 19, we and our properties or operations were not subject to regulation by MSHA under the Mine Act and thus no disclosure is required under Section 1503(a) of the Dodd-Frank Act.

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~~Principal Accounting Officer pursuant to Rule 13a-~~14(a)~~14a 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~~October 1727, 2020 /s/ Stephen J. Antol Stephen J. Antol Chief Financial Officer, Principal Accounting Officer

Filing Compare · Santa Fe Gold CORP