UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[ X ] ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31 2016, 2022

 

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number: 000-51808

 

Commission file number: 000-51808

ATHENA SILVERGOLD CORPORATION

(Exact Name of Registrant as specified in its Charter)

 

Delaware

(State or other jurisdiction of incorporation or organization)

90-0775276

(IRS Employer Identification number)

2010A Harbison Drive # 312, Vacaville, CA

(Address of principal executive offices)

95687

(Zip Code)

 

Registrant's telephone number, including area code: (707) 884-3766291-6198

 

Securities registered under Section 12(b) of the Exchange Act:None

 

Securities registered under Section 12(g) of the Exchange Act:Common Stock, $.0001 par value

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

Title of each ClassTrading SymbolName of each exchange on which registered
N/AN/AN/A

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No[ X ]No

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes [ ] No [ X ]

 

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 [ X ] No [ ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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 [ X ] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [ ]

 

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

 

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [ ]

Smaller Reporting Company [ X ]

(Do not check if a 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 in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X ]

 

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: $1,695,984$10,128,696 based upon the last sale price of $0.12$0.08 as reported on the OTC.QB effective June 30, 2016.2022.

 

The number of shares outstanding of the registrant’s common stock, as of March 8, 201715, 2023, is 36,202,320.136,091,400.

 

List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g.,Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes:

 

None.

 

 


 

 

Forward-looking Statements

In General

 

This Report contains statements that plan for or anticipate the future. In this Report, forward-looking statements are generally identified by the words "anticipate," "plan," "believe," "expect," "estimate," and the like.

 

The factors that could cause actual results to differ materially from those projected in the forward-looking statements include:

 

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the risk factors set forth below under “Risk Factors”;

*

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our ability to raise additional financing necessary to conduct our business;

*

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our future business plans and strategies;

*

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changes that could result from future acquisition of new mining properties or businesses;

*

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our ability to commercially develop our mining interests.;

*

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risks and hazards inherent in the mining business, including environmental hazards, industrial accidents, weather or geologically related conditions;

*

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uncertainties inherent in our exploratory and developmental activities, including risks relating to permitting and regulatory delays;

*

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changes in the market prices of gold or silver;

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uncertainties inherent in the estimation of gold or silver ore reserves;

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effects of environmental and other governmental regulations; and

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the worldwide economic downturn and difficult conditions in the global capital and credit markets.

In addition to the foregoing, the ongoing COVID-19 pandemic poses significant risks and uncertainties in numerous areas, including the availability of labor and materials to explore our mineral interests, risks impacting the cost and availability of insurance and the markets for precious metals. We cannot predict with any certainty the nature and extent of the impact that the pandemic will have on our business plan and operations.

 

Readers are cautioned not to put undue reliance on forward-looking statements. We disclaim any intent or obligation to update publicly these forward-looking statements, whether as a result of new information, future events or otherwise.

 

In light of the significant uncertainties inherent in the forward-looking statements made in this Report, the inclusion of this information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved.

 

 


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PART I

 

ITEM 1.1 – DESCRIPTION OF BUSINESSBUSINESS.

 

Overview

 

We were incorporated on December 23, 2003, in Delaware and our principal business is the acquisition and exploration of mineral resources.

In January 2021, the company’s Board of Directors approved a name change from Athena Silver Corporation, to Athena Gold Corporation. Athena Gold Corporation (“we,” “our,” “us,” or “Athena”) is an exploration stage company engaged in the acquisition and exploration of mineral resources. We began our mining operations in 2010.

We entered into a Mining Lease and Option Agreement which granted us mining rights to the Langtry silver prospect located in San Bernardino County California. Due to the depressed commodities prices over the ensuing decade, we were incorporatednever able to engage in Delaware on December 23, 2003,meaningful exploration efforts. On April 28, 2020, Athena Silver Corporation entered into Agreement to Terminate Lease with Option to Buy dated March 10, 2016 with Bruce and we became an exploration stage company effective January 1, 2010. We have not presently determined whether our mineral properties contain mineral reserves that are economically recoverable.Elizabeth Strachan, Trustees of the Bruce and Elizabeth Strachan Revocable Living Trust dated July 25, 2007, including any and all amendments thereto dated April 28, 2020 with respect to the Langtry Mine in California. As a result of this termination agreement, all scheduled lease option payments due in 2020 and beyond were considered terminated and void upon signing of the Agreement.

 

In December 2009, we formed and organized a new wholly-owned subsidiary, Athena Minerals, Inc. (“Athena Minerals”) which owned and operated our mining interests and properties in California. On December 31, 2020 we sold the subsidiary to take an assignmentJohn Gibbs and/or his affiliate, a related party, in a non-cash exchange to satisfy our more than $2.0 million debt to Mr. Gibbs which is discussed further below and in the Notes to the Consolidated Financial Statements included in this report.

Effective December 27, 2021 (“Effective Date”), the Company simultaneously executed and consummated a definitive Share Purchase Agreement (the “SPA”) with Nubian Resources, Ltd. (“Nubian Resources”). The SPA was the result of a Sale and Purchasepreviously disclosed Option Agreement and Joint Escrow Instructionswith Nubian Resources dated as of December 4, 200911, 2020, as amended by First Amendment to Option Agreement dated November 10, 2021 (the “Purchase Agreement”“Option”). The Purchase AgreementWhile the Option granted us an optionthe Company the right to purchaseacquire up to a 413 acre group of 20 patented100% interest in the mining claims comprising the Excelsior Springs Prospect (the “Langtry Property”“Property”) located in the Calico Mining District at the base of the Calico Mountains northeast of Barstow, California.

In March 2010, we entered into a Mining Lease with Option to Purchase (the “Langtry Lease” or the “Lease”) which superseded the Purchase Agreement and granted us a 20 year lease to develop and conduct mining operations on the Langtry Property, also with an option to purchase. Effective November 28, 2012, December 19, 2013, and January 21, 2015, we executed Amendments No. 1, 2 and 3, respectively, to the Langtry Lease modifying certain terms.

In March 2016, we entered into a new lease/option agreement further described herein that replaced the prior mining lease and its amendments #1, #2 and #3. In addition to the patented claims controlled through this mining lease, the Company has staked and acquired unpatented mining claims that together represent the Langtry project.

On September 28, 2015, at the request ofEsmerelda County, Nevada, the Company and its advisors,Nubian Resources agreed to restructure the San Bernardino County Land Use Services Department (the “Department”)transaction so that the Company purchased 100% of the issued and recordedoutstanding shares of common stock of Nubian Resources (USA) Ltd (“Nubian USA”), a Certificatewholly-owned subsidiary of Land Use Compliance for Vested Land UseNubian Resources which held the Property. By purchasing 100% of Nubian US, the Company effectively acquired the remaining 90% interest in the Property, the Company having previously acquired a 10% interest in the Property in December 2020 under the terms of the Option.

The following is a summary of the terms of the SPA, which summary is qualified in its entirety by reference to the Department formally determinedSPA:

·The consideration paid to Nubian for 100% of the issued and outstanding shares of Nubian US consisted of:
An aggregate of 50 million shares of Athena Gold Corp. common stock, which number includes the 5 million shares of common stock previously issued to Nubian Resources under the Option; and
A 1% Net Smelter Royalty on all production from the Excelsior Springs Property.

·The 50 million shares issued to Nubian Resources were issued as “restricted securities” under the Securities Act of 1933, as amended (“Securities Act”). The Company filed a registration statement on Form S-1 registering the distribution by Nubian of all 50 million shares to its shareholders, pro rata. Nubian Resources had undertaken to complete the distribution of all the shares once the S-1 registration statement has been declared effective. Notwithstanding the fact that the S-1 registration statement was declared effective by the SEC, Nubian Resources elected not to distribute the shares as originally agreed.
·For a period of 12 months following the Effective Date of the SPA, or until Nubian owns less than 4.9% of the Athena issued and outstanding shares, Nubian Resources has agreed to exercise its voting rights with respect to such shares in a manner to support the recommendations of the Athena Board of Directors except for (i) voting on any proposed change in control transaction or (ii) voting on any proposed sale of all or substantially all of the Excelsior Property, including a property included known as Palmetto.
·Nubian is be entitled to nominate one representative to serve on the Athena Board of Directors.

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Athena’s agreement with Nubian Resources includes 100% of the 140 unpatented claims at Excelsior Springs with two additional patented claims held under a lease option that the Langtry property had the legally established right for mineral resource development activity (the “Vested Right”). The Vested Right isare subject to certain conditions set forth ina 2% net smelter returns royalty on gold production. Athena subsequently expanded the Certificate and runsExcelsior Springs project by staking 51 additional claims with the Langtry property in perpetuity.BLM and purchasing the two patented claims previously under a lease option agreement.

 

Going forward,Excelsior Springs is our flagship project and completed a N.I. 43-101 Technical Report to support our secondary listing on the Canadian Stock Exchange that details past work and drill programs and highlight future exploration plans to advance the Property.

We have not presently determined whether our mineral properties contain mineral reserves that are economically recoverable.

Our primary focus going forward will be to continue evaluating our evaluation of the Langtry Property including theproperties, as well as possible acquisitionacquisitions of additional mineral rights and additional exploration, development and permitting activities. Our mineral lease payments, permitting applications and exploration and development effortsall of which will require additional capital.

 

Conflicts of Interests

 

Magellan Gold Corporation (“Magellan”) is a publicly-held company under common control. Mr. Power is our President, CEO and a director and is also a director (and formerly Presidentformer officer and CEO)director of Magellan. Mr. Power and Mr.John Gibbs areis a significant investors inshareholder of both Athena and Magellan.

 

Silver Saddle Resources, LLC (“Silver Saddle”) is a private company under common control. Mr. Power and Mr. Gibbs are significant investors and managing members of Silver Saddle.

 

Athena, Magellan and Silver Saddle are exploration stage companies, and each is involved in the business of acquisition and exploration of mineral resources.

 

The existence of common ownership and common management could result in significantly different operating results or financial position from those that could have resulted had Athena, Magellan and Silver Saddle been autonomous. In addition, the common ownership could result in significant conflicts of interest both in terms of the allocation of working capital as well as under the doctrine of corporate opportunity, inasmuch assince all three entities are engaged in mineral exploration in the United States. Messrs. Power and Gibbs have not adopted any policy or guidelines to mitigate the potential adverse effects of their conflicting interests between and among, Athena, Magellan and Silver Saddle.

 

Investors in Athena should be cognizant that the interests of Athena may, in the future, be in conflict with the other activities of Athena’s control persons.

 

SUMMARY PROVISIONS OF THE LANGTRY LEASE/OPTIONEXCELSIOR SPRINGS PROJECT

Excelsior Springs is Athena Gold’s flagship property, which is located in the southern portion of the Walker Lane. The Excelsior Springs project has been explored by a number of companies over the past 30 years. The target is a large tonnage, moderate grade gold deposit amenable to open pit mining. The Company was granted a drilling and exploration permit (the “Drill Permit”) by the BLM at the Excelsior Springs project in Esmeralda County, Nevada (the “Excelsior Springs Project”). A drilling contractor was engaged and a Phase One RC drill program consisting of 5,575 feet (11 holes) Reverse Circulation (“RC”) drilling program was completed in early April 2022. A Phase Two RC drill program consisting of 2,700 feet (9 holes) was completed in October 2022. A Phase 3 drill program is planned for 2023 subject to sufficient capital being raised in 2023 to complete the next drill program.

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Location and Access:

The Excelsior Springs Property is located in the southeast part of unsurveyed Township 5 south, Range 39 and 40 east, MDBM, Esmeralda County, Nevada, approximately 45 miles southwest of Goldfield, Nevada. The Property is accessed by traveling 14.5 miles (23.2 km) south of Goldfield on US highway 95 and then turning west onto Nevada State Route 266 at Lida Junction and proceeding west for approximately 28.7 miles (45.9 km). Just past mile marker 12, a county-maintained gravel road turns north and leads five miles (8 km) to the Property. There is a locked gate at the southern edge of the patented claims. The Property lies on the moderately hilly south flank of the Palmetto Mountains at an elevation of 6,000 to 8,000 feet (1,829 – 2,439 m) with moderate to heavy juniper/pinion pine cover.

The Excelsior Springs Property comprises 191 unpatented mining claims and two patented mining claims. All of the claims are held by Nubian Resources USA (“Nubian”) and located on Federal Government land administered by the Department of Interior's Bureau of Land Management ("BLM"). Athena staked 51 new BLM claims in Q4-2022 and the remaining 140 BLM claims were acquired as part of the original purchase of the project in December 2021. The two patented claims were leased to Nubian by the owner, Christian Bramwell, of Pahrump, Nevada until purchased in June 2022 as further described below. The patented claims, the Prout and Fortunatus (MS 4106), were located in 1873 and 1892, respectively, and were patented in 1912. The patented claims have both surface and mineral rights. Ownership of the unpatented claims gives the right to explore for and develop mineral resources but no surface rights.

The Property consisted of 42 "EX" and 88 "ES" contiguous, unpatented lode mining claims covering approximately 2,884 acres (1,167 hct) and two patented claims covering 40 acres (16.1 hct). A separate block of ten "ES" claims covering 202 acres (84 hct) is located approximately one mile (1.6 km) northwest of the main block of claims.

 

In 2010, weSeptember and October 2022, the Company expanded the Excelsior Springs claim block by staking 51 new BLM claims ES 2R – ES 38R and BL 1 – BL 32 were staked by Nubian Resources USA Ltd. (our wholly-owned subsidiary) and filed with the BLM in December 2022 and were assigned serial numbers NV 105804872 – NV 105804922.

The Excelsior Springs project now consists of 191 BLM unpatented claims and 2 patented claims or approximately 3,900 acres.

Legal Ownership

On June 9, 2022, the Company entered into an Acquisition Agreement (the “Agreement”) to purchase an undivided 100% interest in the Fortunatus and Prout patented lode mining claims in Esmeralda County, Nevada $185,000. The Agreement was completed in July 2022 with the following terms:

·$25,000 will be settled in cash (Paid July 2022)
·$35,000 of the purchase price settled by the issuance of 500,000 shares of the Company’s common stock (Issued); and
·$125,000 will be settled by a loan, repayable by the Company in quarterly installments of $25,000, beginning November 13, 2022 (paid), and continuing until October 13, 2023, at which time the entire remaining unpaid principal balance will be payable. The balance on the loan as of the date of this filing is $75,000.

Nubian Resources Ltd (The “seller”) retained a 1% Net Smelter Returns Royalty (the "NSR Royalty") on the claims it sold to Athena. One-half (0.5%) of the NSR Royalty may be purchased by Athena for CAD $500,000 payable to Nubian Resources. An additional one-half (0.5%) of the NSR Royalty may be purchased by Athena at fair market value.

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History:

The Buster Mine claim block was discovered in 1872 and has been through several periods of small-scale mining and exploration efforts. During the late 1800s and perhaps the early 1900s there was unconfirmed production from the Buster Mine of an estimated 18,000 tons at 1.2 oz Au/ton (37.3 g/T). Little else is known about work on the mine until Fernand Lemieux re-timbered the Buster shaft in 1964 at a reported cost of $50,000 (Grant, 1986). A visual inspection of the shaft indicated the ladders were still in good condition. Since 1964, the Property has been explored by a number of companies as described below:

·1960s & 1970s – Efforts to re-timber the shafts and attempts at small scale mining
·1986 – Great Pacific Resources (11 RC holes)
·1988 – Lucky Hardrock JV (12 RC holes)
·2005-2007 – Walker Lane Gold (22 RC holes)
·2008 – Evolving Gold (8 RC holes)
·2011-2014 – Global Geoscience and partner Osisko Mining (31 RC holes & Geophysics)

Geology and Mineralization:

The project comprises 140 unpatented and two patented lode claims covering 2,884 acres (1,167 hct). The project has had some historic, high-grade gold production from silicified zones on the patented claims. These zones are contained in several, large, intensely altered, E-W-trending shear zones in Paleozoic siltstones and limestones. These shear zones host structurally and lithologically controlled gold mineralization within a 3 X 1 km area of intense clay alteration. The shear zones have been collectively named the Excelsior Springs Shear Zone, ESSZ, and form the core of the exploration targets on the property.

Geology and Mineralization. The Property lies within the Walker Lane, a regional-scale zone of northwest-trending, strike-slip faulting. The Walker Lane hosts a significant number of precious metal deposits including the Comstock Lode at Virginia City, Borealis, Aurora, Mineral Ridge, Paradise Peak, Rawhide, Tonopah, Goldfield and the Bullfrog District. These deposits are Tertiary in age, and all have a very strong structural control for the mineralization. However, the author has not verified information with respect to the abovementioned deposits, and information in this Report with respect to these deposits is not necessarily indicative of the mineralization on the Excelsior Springs Property. The Excelsior Springs Property area contains a thick section of basal Precambrian-Cambrian sedimentary rocks that are complexly interlayered by thrust faults with the Ordovician Palmetto Formation. On the Property, there are a large number of prospect pits, small trenches and drill roads concentrated along the Excelsior Springs Property structural zone ("ESSZ"), a 1,000 foot-wide and 10,000 foot-long (304 m x 3,048 m), east-west-trending zone of shearing and alteration. Underground workings on the two patented claims have been the source of the Property's unverified, historic production, reported to be 19,200 oz Au (18,000 tons containing 1.2 oz Au/ton (37.3 g Au/T)). Assay results for the 84 RC holes that have been drilled on the Property show that 51 of the holes (61 %) contain a 20-foot interval averaging 0.25 g Au/T, typical cut-off grade for Nevada open-pit gold mines. Forty of the holes (48 %) contain a 20-foot interval averaging 0.5 g Au/T, and 24 of the holes (29 %) contain a 20-foot interval averaging 1.0 g Au/T.

Property Geology. The Excelsior Springs Property area contains basal Precambrian-Cambrian sedimentary rocks complexly interlayered by thrust faults with the Ordovician Palmetto Formation, as seen in Figure 17 (McKee, 1985). Lithologic units shown on the map are listed below.

Qa - Alluvium, (Quaternary) - sand and gravel.

Tq - Quartz porphyry and alaskite dikes, (Miocene) - Light-colored, quartz-rich fine- grained intrusive rocks.

Opa - Palmetto Formation, (Ordovician) - Heterogeneous mixture of dark, thin-bedded chert, shale, limestone and quartzites, usually in thrust fault contact with older rocks.

Ce - Emigrant Formation, (Cambrian) - Gray- green limey siltstone with sandstone interbeds. Grades upward into platy, gray, aphanitic limestone with chert nodules, chert beds and intraformational limestone conglomerates.

Ch - Harkless Formation, (Cambrian) - Interbedded fine-grained sandstone, siliceous siltstone and thin limestone.

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Miocene rhyolite and hornblende diorite dikes (Tq) occur throughout the Property and are particularly abundant in the area east of the Excelsior Springs Property. Most of the dikes are aligned parallel to the east-west to east-northeast trends of the mineralization in the ESSZ. The quartz-rich rhyolite dikes appear to be more closely associated with alteration and gold mineralization than do the hornblende diorite dikes.

The 3,500 foot-thick (1,067 m), Cambrian-age (Ch) Harkless Formation seems to be the predominant host for the alteration and mineralization and is divided into a lower, greenish-gray quartz-rich siltstone member and an upper olive-gray siltstone member. Limestone layers, up to 100 feet-thick (30 m), occur in the lower member. The Cambrian-age (Ce) Emigrant Formation overlying the Harkless consists of a lower, multi-colored limestone-siltstone member, a middle, greenish-gray shale member and an upper, gray, cherty limestone member. The Emigrant Formation is about 1,300 feet-thick (396 m).

Mineralized Zones. The east-west trending ESSZ shows strong hydrothermal alteration over an area 1,000-1,800 feet-wide (305 – 549 m) and 10,000 feet-long (3,050 m) and appears to extend under Quaternary gravels to the west of the Buster and pit areas. In addition to the area around the Buster shaft, there are many other scattered zones of anomalous gold and base metal mineralization within the ESSZ. There are large, well developed, east-west-trending drainages to the north and south of the ESSZ. These drainages also contain outcrops of strongly altered rocks that have not been closely examined. Mineralization on the claims is hosted mostly in the Harkless Formation and the Emigrant Formation. Mineralization occurs almost entirely in shear zones which are characterized by brecciation, silicification and local mylonitization. The ESSZ contains well developed fractures striking east-west and well mineralized sets of north-, northeast- and northwest-striking fractures. There are several gold-bearing quartz veins containing galena and tetrahedrite in the shear zones that represent a post-deformation period of mineralization. Most of the mineralized zones do not contain visible sulfides.

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Gold mineralization is localized by the structures and occurs as veinlets and veins. Gold also appears to occur in a disseminated form in favorable stratigraphic units. Brecciated quartz veins are common in the mineralized zones but frequently exhibit no direct correlation with higher gold values. Quartz-copper veins and pods of white quartz are also brecciated and locally re-cemented with fine-grained crystalline to chalcedonic silica. A strong correlation between visible copper and/ or zinc oxides and carbonates and higher-grade gold values has been noted. Cadmium and antimony values are anomalous but somewhat randomly distributed, and arsenic is strongly correlated with gold values greater than 8 ppm.

EXPLORATION ACTIVITIES:

Summary

Athena has begun an initial work program for the Excelsior Springs Property comprising the following:

·Data compilation and review;
·Geologic mapping and sampling of selected areas of the project;
·Acquisition and evaluation of hyperspectral satellite imagery for alteration studies;
·Refining the project's structural model for mineralization;
·Developing a 3-D, computer generated model of the Buster area mineralization;
·Creating a new set of 1:1200 scale cross sections to include all drill holes.

(a) Data Compilation. There is a large amount of historic data generated by previous exploration programs on the Property. Much of the earlier data is incomplete and weakly documented but still useful. A new compilation of all the drilling results including collar location, hole azimuth, dip, total depth and gold values has been completed and used to construct the three-dimensional model and new cross sections.

(b) Geologic Mapping and Sampling. Approximately 20 man-days have been spent mapping in selected areas of the project. Mapping was done on detailed color photos at a scale of 1:2,400 with a particular focus on alteration zones and structural features. This new work is being integrated into the existing geologic map and will be fully digital. The new geologic map has not been completed, but it will serve as a base layer for showing alteration, mineralization, structures, geophysical data and drill hole projections. In conjunction with the mapping of selected areas, the Company has collected and processed 100 surface rock chip samples. Custody of these samples was maintained by the geologists and then delivered to American Assay Labs in Sparks, Nevada. All samples were fire assayed for gold, and an ICP process was used for other elements. The assay process is described in Section 11.1 of this Report and duplicate, standard and blank samples were used.

(c)       Hyperspectral Data. SpecTir Imagery of Reno, Nevada provided a suite of hyperspectral images covering the area around the project. The study shows the alteration mineralogy image generated by the SpecTIR data. The Buster zone clearly shows strong kaolinite and sodium-rich illite (paragonite) alteration. The strong clay alteration zone continues eastward to the Ridge zone (447300 E) and further east into the Excelsior Springs Property area (448000 E). Further east and west from the Buster zone the clay mineralogy becomes potassium-rich phengite along with muscovite.

(d)       Refining the Structural Model. Ore deposits found within the Walker Lane and particularly mineralized zones in the ESSZ are both structurally and lithologically controlled.

(e)       Three-Dimensional Model. Geo Vector Consultants and Mountain Goat Consulting has utilized the updated drill hole data base for the Property and has generated the 3-D model for the mineralized zones. There are multiple intercepts of potentially well mineralized material in many of the holes, but further infill drilling is needed to better confirm continuity of the zones between the holes.

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(f)       Cross Sections. Mine Development Associates ("MDA"), a division of RESPEC Inc., consultants in Reno, generated a complete set of 1:600 scale cross sections along with a topographic map showing all of the drill holes and mineralized intervals.

The Company was granted a drilling and exploration permit (the “Drill Permit”) by the BLM in December 2021 for its Excelsior Springs Project in Esmeralda County, Nevada. The permit was amended in 2022. Athena has posted the required reclamation bond with the BLM to secure the Drill Permit.

Athena entered into a 20 year Mining Leasecontract with OptionNew Frontier Drilling and in April 2022 completed its maiden drill program with 11 RC holes on both the patented and unpatented claims totaling approximately 5,500 feet.

The Company updated its permit with the BLM with additional locations and completed a Phase 2 drill program with 9 RC holes on both the patanted and unpatented claims totalling approximately 2,800 feet.

Athena submitted the samples from the drill program to Purchase (the “Langtry Lease”an independent assay lab in Reno, Nevada for analysis.

  Phase 1 RC Drilling Data and Results 
         
HoleIntervals, Feet  2AzimuthDeclineGold  1SilverTotal
IDFromToLengthDegreesDegreesG/TG/TDepth, Ft
DB-24nsm  050  400
         
DB-23140250110180505.158.9400
includes14019555  10.0317.3 
includes14017535  15.3526.5 
         
DB-22220240200900.613.1400
"26528520  1.482.8 
"34036020  1.015.6 
         
DB-321527560135501.104.0350
         
BT-16*  21850  695
BT-15nsm  3850  825
BT-13nsm  090  375
BT-12nsm  18050  350
BT-11*  18050  500
         
BT-711013020135501.114.0380
         
BT-651053020120500.2216.9900
       Total Drilling5,575
nsm: no significant mineral
*   assays not yet received
1   Nominal gold cut off: 0.20 g/t.
2   Minimum mineral interval of 20 feet. Minimum 20 feet waste between mineral intervals.

    Maximum 20 feet waste within mineral intervals. As most spatial data is not yet available,

    drill intervals are not true mineral thicknesses.

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  Phase 2 Drilling Data and Results       
HoleIntervals, Feet  2Intervals, Meters 2AzimuthDeclineAuAgAu Eq Cu 4Pb4Zn4 Hole DepthZone
IDFromToLengthFromToLengthDegreesDegreesG/TG/TG/T 3 %%% FtM5
22-011302209039.667.127.4162606.04517.46.274 0.0710.2940.476 30091.4WS
Includes1301653539.650.310.7  10.20030.810.605 0.1700.6441.140    
 2553004577.791.413.7  4.97014.405.159 0.0700.8211.003    
                    
22-021351855041.156.415.2197554.49227.34.851 0.0560.3820.546 30091.4WS
Includes1451753044.253.39.1  7.29344.27.874 0.0910.6210.873    
 2252502568.676.27.6  1.1957.71.296 0.0230.2270.220    
                    
22-03NSM     16045        30091.4WS
                    
22-0455752016.822.96.1135500.2526.00.331 0.0040.0160.015 400121.9MB
                    
22-05050500.015.215.2135600.3953.300.438 0.0090.1170.179 20061.0MB
 1451702544.251.87.6  0.6462.960.000 0.0060.0490.048    
                    
22-06NSM     13550        30091.4MB
                    
22-07NSM     13560        30091.4WS
                    
22-08NSM     13559        30091.4WS
                    
22-12NSM     13555        30091.4WS
             Total Drilling 2,700 823.0  
'NSM: no significant mineral
1 Nominal gold cut off: 0.20 g/t.
2 Minimum mineral interval of 20 feet. Minimum 20 feet waste between mineral intervals.
3 Based on prices of $1775/oz Au and $23/oz Ag
4 Geochemical analysis of anomalous base metals
5 WS: West Slope Zone MB: Main Buster Zone
Maximum 20 feet waste within mineral intervals. As most spatial data is not yet available, drill intervals are not true mineral thicknesses.

Future exploration phases would be needed to precisely define depth, width, length, tonnage and value per ton of any deposit that has been identified and would involve:

·

RC and CORE drilling. A permit is in place with the BLM and a bond has been posted to allow for additional RC drilling.

Conduct a new gradient array IP survey that will provide data to a depth of approximately 900 feet (274 m) and better define the southwestern chargeability zone.

·conducting metallurgical testing; and
·obtaining other pertinent technical information required to define an ore reserve and complete a feasibility study.

Depending upon the nature of the particular deposit, future exploration phases on the property could take one to five years or the “Lease”) granting us the exclusive right to explore, developmore and conduct mining operations on a groupcost well in excess of 20 patented$1 million.

10

OTHER NON-MATERIAL PROJECTS

(a)PALMETTO PROSPECT

Nubian Resources USA, Ltd. also holds nine (9) unpatented mining claims consisting of approximately 413 acres that comprise our Langtry Property (“Langtry” or the “Langtry Property”). Effective November 28, 2012, December 19, 2013 and January 21, 2015, we executed Amendments No. 1, 2 and 3, respectively, to the Langtry Lease modifying certain terms.

Effective March 10, 2016, we executedand delivered new Lease/Purchase Option (“Lease/Option”) covering our flagship Langtry Propertya prospect known as Palmetto located in the CalicoRailroad Springs Mining District San Bernardinoin Esmeralda County, California.Nevada. The Lease/Option also includes twoCompany has no current plans to explore the prospect and the claims are held for investment.

(b)CROW SPRINGS PROSPECT

Athena leased from an independent geologist seven unpatented mining claims and then staked four additional unpatented mining claims for a total of eleven (11) claims in the CalicoCrow Springs Mining District known as the Lilly #10 and Quad Deuce XIII (the “Langtry Unpatented Claims”), which we have previously owned and agreed to transfer to the Lessor subject to the Lease/Option. The new Lease/Option supersedes all prior agreements. The following is a summary of the highlights of the new Lease/Option, which is qualifiedlocated in its entirety by the provisions of the Lease/Option which was filed as Exhibit 10.1 to our Current Report dated March 10, 2016:Esmeralda County, Nevada.

 

The Lease/OptionCompany has a term of 20 years, and grants an exclusive rightno current plans to explore developthe prospect and purchase the Langtry property. Rent payments under the Leaseclaims are a nominal $1 per year which was paid in full but contingent upon the option being maintained in good standing. held for investment.

 

Option payments: in order to maintain the option to purchase, we are required to pay option payments (“Option Payments”) on March 15th of every year as follows: $40,000 year 1 that was paid for the period through March 15, 2017; the greater of $40,000No Proven or the spot price of 2,500 ounces of silver in years 2 through 5; the greater of $50,000 or the spot price of 2,500 ounces of silver in years 6 through 10; the greater of $75,000 or the spot price of 3,750 ounces of silver in years 11 through 15; and the greater of $100,000 or the spot price of 5,000 ounces of silver in years 16 through 20. The spot price of silver shall be defined as the average price of the London Fix as reported in the Wall Street Journal or another reliable source for the calendar month for the month prior to each payment date (i.e. the month of February).Probable Mineral Reserves/Exploration Stage Company

 

50%We are considered an exploration stage company under SEC criteria since we have not demonstrated the existence of all Option Payments are credited against the purchase price should the Company exercise the purchase option. proven or probable mineral reserves at any of our properties.

 

Option Purchase Price: We have the option to purchase fee title to the LangtryThe SEC’s Final Rule 13-10570, Modernization of Property Disclosures for the full 20 year term of the Lease/Option. The purchase price is: Mining Registrants, became effective March 30, 2019, and rescinds SEC Industry Guide 7 following a two-year transition period.

 

Years 1 through 3 (3-15-2016 to 3-15-2019): $5,000,000 

Years 4 through 5 (3-15-2019 to 3-15-2021):Under the greaterformer Industry Guide 7, the SEC defined a “reserve” as that part of $5,000,000a mineral deposit which could be economically and legally extracted or the spot price of 250,000 troy ounces of silver, plus payment of the deferred rent of $130,000; 

Years 6 through 10 (3-15-2021 to 3-15-26): the greater of $7,500,000 or the spot price of 375,000 troy ounces of silver, plus payment of the deferred rent of $130,000; 

Years 11 through 20 (3-15-2026 to 3-15-2036): the greater of $10,000,000 or the spot price of 500,000 troy ounces of silver, plus payment of the deferred rent of $130,000. 

During the lease term, and provided the purchase option has not been exercised, the lessor is entitled to receive a 2% NSR on silver production and a 3% to 5% royalty on other mineral production and certain other revenue streams; 

After exercise of the purchase option, the lessor will not receive royalties on silver or other precious metals production but will receive a 5% royalty on barite production and other revenue streams. 

Deferred rent of $130,000 under the prior lease shall be payable upon exercise of the purchase option or upon Athena entering into a joint venture or other arrangement to develop the Langtry prospect. 

If we are in breach of the Lease/Option, the Lessor will have the option to terminate the Lease by giving us 30 days written notice. The Lease also provides us with the right to terminate the Lease without penalty on March 15th of each year during the Lease term by giving the lessor 30 days written notice of termination on or before February 13th of each year. 

The Langtry Property is also subject to a net smelter royalty in favor of Mobil Exploration and Producing North America Inc. from the sale of concentrates, precipitates or metals produced from ores mined from the royalty acreage. The agreement dated April 30, 1987 granted a base net smelter royalty of 3% plus an additional incremental 2% royalty on net smelter proceeds from silver sales above $10.00 per troy ounce plus an additional incremental 2% royalty on net smelter proceeds from silver sales above $15.00 per troy ounce. 

On May 28, 2015 we executed an amendment to the deed underlying the Langtry Lease to cap at 2% the net smelter royalty that would be due to Mobil Exploration and Producing North America Inc. (“Mobil”) from any future sales of concentrates, precipitates or metals produced from ores mined from the royalty acreage. In consideration for the amendment, we agreed to pay an amendment fee of $150,000, with $10,000 due at the time of the agreementreserve determination. Proven or probable mineral reserves were those reserves for which (a) quantity is computed and (b) the sites for inspection, sampling, and measurement are spaced so closely that the geologic character is defined and size, shape and depth of mineral content can be established (proven) or the sites are farther apart or are otherwise less adequately spaced but high enough to assume continuity between observation points (probable). Mineral Reserves could not be considered proven or probable unless and until they are supported by a feasibility study, indicating that the mineral reserves have had the requisite geologic, technical and economic work performed and are economically and legally extractable.

The final rule’s amendments require disclosure of both mineral reserves and mineral resources. Under the final rule, a mineral reserve is defined as “an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project.” A mineral resource is defined as “a concentration or occurrence of material of economic interest in or on the Earth’s crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.” Under the SEC’s former disclosure requirements under Industry Guide 7, , an assessment of the economic viability of mineral reserves must be supported by a final feasibility study. By contrast, the final rule’s amendments provide that a prefeasibility study, which is more limited in scope than a final feasibility study, will also be sufficient to support such an assessment. As for mineral resources, their disclosure is prohibited under former SEC guidance unless it is required under the regulations of another jurisdiction, such as Canada. Under the final rule’s amendments, however, mineral resources must be disclosed and categorized as “measured” (if the geological sampling is “conclusive”), “indicated” (if the geological sampling is “adequate”), or “inferred” (if the geological sampling is “limited”). Effectively, the categorization is based on the company’s confidence in its ability to develop the mineral resources, which depends on the sampling and testing that have been performed. The final rule’s amendments also require companies to disclose exploration results when such information would be material to investors. Further, the disclosures required under the final rule must be supported by the work of a qualified person, such as a mine engineer. When a company first reports mineral reserves or resources, or makes a material change to such disclosures, it must file a technical report summary supporting the disclosure. Developing this detailed disclosure information (e.g., by using an expert) and maintaining appropriate disclosure controls and procedures over it requires significant time, resources, and effort.

11

MARKETING

All of our mining operations, if successful, will produce gold in doré form or a concentrate that contains gold.

We plan to market our refined metal and doré to credit worthy bullion trading houses, market makers and members of the London Bullion Market Association, industrial companies and sound financial institutions. The refined metals will be sold to end users for use in electronic circuitry, jewelry, silverware, and the balance payable $10,000 each June 1st until paidpharmaceutical and technology industries. Generally, the loss of a single bullion trading counterparty would not adversely affect us due to the liquidity of the markets and the availability of alternative trading counterparties.

We plan to refine and market its precious metals doré and concentrates using a geographically diverse group of third party smelters and refiners. The loss of any one smelting and refining client may have a material adverse effect if alternate smelters and refiners are not available. We believe there is sufficient global capacity available to address the loss of any one smelter.

GOVERNMENT REGULATION

General

Our activities are and will be subject to extensive federal, state and local laws governing the protection of the environment, prospecting, mine development, production, taxes, labor standards, occupational health, mine safety, toxic substances and other matters. The costs associated with compliance with such regulatory requirements are substantial and possible future legislation and regulations could cause additional expense, capital expenditures, restrictions and delays in full.the development and continued operation of our properties, the extent of which cannot be predicted. In the context of environmental permitting, including the approval of reclamation plans, we must comply with known standards and regulations which may entail significant costs and delays. Although we are committed to environmental responsibility and believe we are in substantial compliance with applicable laws and regulations, amendments to current laws and regulations, more stringent implementation of these laws and regulations through judicial review or administrative action or the adoption of new laws could have a materially adverse effect upon our results of operations.

Federal Environmental Laws

Certain mining wastes from extraction and beneficiation of ores are currently exempt from the extensive set of Environmental Protection Agency (“EPA”) regulations governing hazardous waste, although such wastes may be subject to regulation under state law as a solid or hazardous waste. The EPA has worked on a program to regulate these mining wastes pursuant to its solid waste management authority under the Resource Conservation and Recovery Act (“RCRA”). Certain ore processing and other wastes are currently regulated as hazardous wastes by the EPA under RCRA. If our future mine wastes, if any, were treated as hazardous waste or such wastes resulted in operations being designated as a “Superfund” site under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA” or “Superfund”) for cleanup, material expenditures would be required for the construction of additional waste disposal facilities or for other remediation expenditures. Under CERCLA, any present owner or operator of a Superfund site or an owner or operator at the time of its contamination generally may be held liable and may be forced to undertake remedial cleanup action or to pay for the government’s cleanup efforts. Such owner or operator may also be liable to governmental entities for the cost of damages to natural resources, which may be substantial. Additional regulations or requirements may also be imposed upon our future tailings and waste disposal, if any, in Nevada under the Federal Clean Water Act (“CWA”) and state law counterparts. We have paidreviewed and considered current federal legislation relating to climate change and we do not believe it to have a totalmaterial effect on our operations. Additional regulation or requirements under any of $20,000 so far on this agreement. If we sellthese laws and regulations could have a materially adverse effect upon our interest in the Lease or enter into an agreement, joint venture or other agreement for the exploration and developmentresults of the Langtry Property, the amendment fee shall become due and payable immediately. operations.

 

During the term of the Lease/Option, Athena Minerals has the exclusive right to develop and conduct mining operations on the Langtry Property. Future lease payments and/or exploration and development of this property will require additional equity and/or debt capital.

 

LANGTRY

12

EXCELSIOR SPRINGS PROJECT CLAIMS

 

In April, 2010, we staked nine unpatented mining lode claimsThe following map shows the location of the patented and in October 2011, we staked an additional 13 unpatented mining lode claims all of which are located in Sections 7,8,9,16,17 & 18 of Township 10 North, Range 1 East, San Bernardino Base & Meridian on federal land managed by the Bureau of Land Management (“BLM”). These 22 unpatented claims are adjacent or in close proximity to our Langtry Property. In Jan 2013, we over staked one additional unpatented mining claim. In August 2015, we acquired 15 unpatented mining claims adjacent to our existing holdings. These 38 unpatented claims together withthat comprise the 20 patented Langtry Property claims comprise our Langtry Project. AllExcelsior Springs Project as of our unpatented claims are active and valid, subject to renewals. We have not undertaken any exploration activity on our unpatented claims and they have no known reserves. Our annual renewal costs are $155 per claim prior to September 1 of each year.December 31, 2022:

 

BLM Serial No.Claim Name

 

CAMC296910Clipper #1 

CAMC296911Clipper #2 

CAMC296912Clipper #3 

CAMC296913Clipper #4 

CAMC296914Clipper #5 

CAMC296915Hawaii Clipper 

CAMC296916California Clipper #2 

CAMC296917California Clipper #3 

CAMC296918California Clipper #4 

CAMC300265Clipper #12 

CAMC300266Clipper #13 

CAMC300267Clipper #14 

CAMC300268Clipper #15 

CAMC300269Clipper #16 

CAMC300270Clipper #17 

CAMC300271Clipper #18 

CAMC300272Clipper #19 

CAMC300273Clipper #20 

CAMC300274Clipper #21 

CAMC300275Clipper #22 

CAMC300276Clipper #23 

CAMC300277Clipper #24 

 

On January 15, 2013, we over-staked with the BLM an existing claim, (CAMC0306178) Quad Duece XIII. The claim we over-staked Lilly #10 (CACM 290263) was later acquired in August 2015. Both the Lilly#10 and Quad Deuce XIII were assigned to the Lessor and included in our rights under the Lease/Option.

 

In August 2015 the Company acquired

13

Excelsior Springs Project - List of ES Claims

 Claim NameNMC #ClaimantValid Until
1ES 11045871Nubian Resources USA Ltd.9/1/2023
2ES 31045873Nubian Resources USA Ltd.9/1/2023
3ES 51045875Nubian Resources USA Ltd.9/1/2023
4ES 71045877Nubian Resources USA Ltd.9/1/2023
5ES 91045879Nubian Resources USA Ltd.9/1/2023
6ES 111045881Nubian Resources USA Ltd.9/1/2023
7ES 131045883Nubian Resources USA Ltd.9/1/2023
8ES 151045885Nubian Resources USA Ltd.9/1/2023
9ES 171045887Nubian Resources USA Ltd.9/1/2023
10ES 191045889Nubian Resources USA Ltd.9/1/2023
11ES 211045891Nubian Resources USA Ltd.9/1/2023
12ES 231045893Nubian Resources USA Ltd.9/1/2023
13ES 251045895Nubian Resources USA Ltd.9/1/2023
14ES 271045897Nubian Resources USA Ltd.9/1/2023
15ES 291045899Nubian Resources USA Ltd.9/1/2023
16ES 311045901Nubian Resources USA Ltd.9/1/2023
17ES 331045903Nubian Resources USA Ltd.9/1/2023
18ES 351045905Nubian Resources USA Ltd.9/1/2023
19ES 371045907Nubian Resources USA Ltd.9/1/2023
20ES 391045909Nubian Resources USA Ltd.9/1/2023
21ES 401045910Nubian Resources USA Ltd.9/1/2023
22ES 411045911Nubian Resources USA Ltd.9/1/2023
23ES 421045912Nubian Resources USA Ltd.9/1/2023
24ES 431045913Nubian Resources USA Ltd.9/1/2023
25ES 441045914Nubian Resources USA Ltd.9/1/2023
26ES 451045915Nubian Resources USA Ltd.9/1/2023
27ES 461045916Nubian Resources USA Ltd.9/1/2023
28ES 471045917Nubian Resources USA Ltd.9/1/2023
29ES 481045918Nubian Resources USA Ltd.9/1/2023
30ES 491045919Nubian Resources USA Ltd.9/1/2023
31ES 501045920Nubian Resources USA Ltd.9/1/2023
32ES 511045921Nubian Resources USA Ltd.9/1/2023
33ES 521045922Nubian Resources USA Ltd.9/1/2023
34ES 531045923Nubian Resources USA Ltd.9/1/2023
35ES 541045924Nubian Resources USA Ltd.9/1/2023
36ES 551045925Nubian Resources USA Ltd.9/1/2023
37ES 561045926Nubian Resources USA Ltd.9/1/2023
38ES 571045927Nubian Resources USA Ltd.9/1/2023
39ES 581045928Nubian Resources USA Ltd.9/1/2023
40ES 591045929Nubian Resources USA Ltd.9/1/2023
41ES 601045930Nubian Resources USA Ltd.9/1/2023
42ES 611045931Nubian Resources USA Ltd.9/1/2023

14

 Claim NameNMC#ClaimantValid Until
43ES 621045932Nubian Resources USA Ltd.9/1/2023
44ES 631045933Nubian Resources USA Ltd.9/1/2023
45ES 641045934Nubian Resources USA Ltd.9/1/2023
46ES 651045935Nubian Resources USA Ltd.9/1/2023
47ES 661045936Nubian Resources USA Ltd.9/1/2023
48ES 671045937Nubian Resources USA Ltd.9/1/2023
49ES 681045938Nubian Resources USA Ltd.9/1/2023
50ES 691045939Nubian Resources USA Ltd.9/1/2023
51ES 701045940Nubian Resources USA Ltd.9/1/2023
52ES 711045941Nubian Resources USA Ltd.9/1/2023
53ES 721045942Nubian Resources USA Ltd.9/1/2023
54ES 731045943Nubian Resources USA Ltd.9/1/2023
55ES 741045944Nubian Resources USA Ltd.9/1/2023
56ES 751045945Nubian Resources USA Ltd.9/1/2023
57ES 761045946Nubian Resources USA Ltd.9/1/2023
58ES 771045947Nubian Resources USA Ltd.9/1/2023
59ES 781045948Nubian Resources USA Ltd.9/1/2023
60ES 791045949Nubian Resources USA Ltd.9/1/2023
61ES 801045950Nubian Resources USA Ltd.9/1/2023
62ES 811045951Nubian Resources USA Ltd.9/1/2023
63ES 821045952Nubian Resources USA Ltd.9/1/2023
64ES 831045953Nubian Resources USA Ltd.9/1/2023
65ES 841045954Nubian Resources USA Ltd.9/1/2023
66ES 851045955Nubian Resources USA Ltd.9/1/2023
67ES 861045956Nubian Resources USA Ltd.9/1/2023
68ES 871045957Nubian Resources USA Ltd.9/1/2023
69ES 881045958Nubian Resources USA Ltd.9/1/2023
70ES 891045959Nubian Resources USA Ltd.9/1/2023
71ES 901045960Nubian Resources USA Ltd.9/1/2023
72ES 911045961Nubian Resources USA Ltd.9/1/2023
73ES 921045962Nubian Resources USA Ltd.9/1/2023
74ES 931045963Nubian Resources USA Ltd.9/1/2023
75ES 941045964Nubian Resources USA Ltd.9/1/2023
76ES 951045965Nubian Resources USA Ltd.9/1/2023
77ES 961045966Nubian Resources USA Ltd.9/1/2023
78ES 971045967Nubian Resources USA Ltd.9/1/2023
79ES 981045968Nubian Resources USA Ltd.9/1/2023
80ES 991045969Nubian Resources USA Ltd.9/1/2023
81ES 1001045970Nubian Resources USA Ltd.9/1/2023
82ES1031057362Nubian Resources USA Ltd.9/1/2023
83ES1051057364Nubian Resources USA Ltd.9/1/2023
84ES1071057366Nubian Resources USA Ltd.9/1/2023

15

 Claim NameNMC#ClaimantValid Until
85ES1091057368Nubian Resources USA Ltd.9/1/2023
86ES1761057394Nubian Resources USA Ltd.9/1/2023
87ES1791057395Nubian Resources USA Ltd.9/1/2023
88ES1801057396Nubian Resources USA Ltd.9/1/2023
89ES2451057460Nubian Resources USA Ltd.9/1/2023
90ES2461057461Nubian Resources USA Ltd.9/1/2023
91ES2471057462Nubian Resources USA Ltd.9/1/2023
92ES2481057463Nubian Resources USA Ltd.9/1/2023
93ES2491057464Nubian Resources USA Ltd.9/1/2023
94ES2501057465Nubian Resources USA Ltd.9/1/2023
95ES2511057466Nubian Resources USA Ltd.9/1/2023
96ES2521057467Nubian Resources USA Ltd.9/1/2023
97ES2531057468Nubian Resources USA Ltd.9/1/2023
98ES2541057469Nubian Resources USA Ltd.9/1/2023

Excelsior Springs Project - List of EX Claims

 Claim NameNMC #ClaimantValid Until
1EX 1887756Nubian Resources USA Ltd.9/1/2023
2EX 2887757Nubian Resources USA Ltd.9/1/2023
3EX 3887758Nubian Resources USA Ltd.9/1/2023
4EX 4887759Nubian Resources USA Ltd.9/1/2023
5EX 5887760Nubian Resources USA Ltd.9/1/2023
6EX 6887761Nubian Resources USA Ltd.9/1/2023
7EX 7887762Nubian Resources USA Ltd.9/1/2023
8EX 8887763Nubian Resources USA Ltd.9/1/2023
9EX 9887764Nubian Resources USA Ltd.9/1/2023
10EX 10887765Nubian Resources USA Ltd.9/1/2023
11EX 11887766Nubian Resources USA Ltd.9/1/2023
12EX 12887767Nubian Resources USA Ltd.9/1/2023
13EX 13887768Nubian Resources USA Ltd.9/1/2023
14EX 14887769Nubian Resources USA Ltd.9/1/2023
15EX 20897986Nubian Resources USA Ltd.9/1/2023
16EX 21897987Nubian Resources USA Ltd.9/1/2023
17EX 22897988Nubian Resources USA Ltd.9/1/2023
18EX 23897989Nubian Resources USA Ltd.9/1/2023

16

 Claim NameNMC #ClaimantValid Until
19EX 24897990Nubian Resources USA Ltd.9/1/2023
20EX 25897991Nubian Resources USA Ltd.9/1/2023
21EX 26897992Nubian Resources USA Ltd.9/1/2023
22EX 27897993Nubian Resources USA Ltd.9/1/2023
23EX 28897994Nubian Resources USA Ltd.9/1/2023
24EX 29897995Nubian Resources USA Ltd.9/1/2023
25EX 30897996Nubian Resources USA Ltd.9/1/2023
26EX 31897997Nubian Resources USA Ltd.9/1/2023
27EX 32897998Nubian Resources USA Ltd.9/1/2023
28EX 33897999Nubian Resources USA Ltd.9/1/2023
29EX 34898000Nubian Resources USA Ltd.9/1/2023
30EX 35898001Nubian Resources USA Ltd.9/1/2023
31EX 36898002Nubian Resources USA Ltd.9/1/2023
32EX 37898003Nubian Resources USA Ltd.9/1/2023
33EX 38898004Nubian Resources USA Ltd.9/1/2023
34EX 39898005Nubian Resources USA Ltd.9/1/2023
35EX 40898006Nubian Resources USA Ltd.9/1/2023
36EX 41898007Nubian Resources USA Ltd.9/1/2023
37EX 42898008Nubian Resources USA Ltd.9/1/2023
38EX 43898009Nubian Resources USA Ltd.9/1/2023
39EX 44898010Nubian Resources USA Ltd.9/1/2023
40EX 45898011Nubian Resources USA Ltd.9/1/2023
41EX 46898012Nubian Resources USA Ltd.9/1/2023
42EX 47898013Nubian Resources USA Ltd.9/1/2023

Additional Claim blocks ES 2R – ES 38R and BL 1 – BL 32 were staked by deed conveyance 15 unpatented mining claimsNubian Resources USA Ltd. in the Calico Mining District in San Bernardino, California from a third party. One of these claims was subsequently transferred to the Lessor subject to the Lease/Option. The claims are contiguous to our existing unpatentedSeptember and patented claims known as the Langtry Property. In consideration of the conveyance, the Company agreed to pay $10,000, payable in equal monthly installments of $1,000 beginning on September 1, 2015. The Company has completed all required payments. These claims were renewedOctober 2022 and filed with the BLM in August 2015December 2022 and 2016 and are in good standing until August 31, 2017. There is a recorded lien granted to a third party on these claims granted by the former owner. We are attempting to get a release of this lien as we no longer believe it is valid. However, we can make no assurances that a lien release can be obtained and that the lien is no longer valid.

CAMC 0290264

LILLY #11

CAMC 0290265

LILLY #12

CAMC 0290266

LILLY #13

CAMC 0290267

LILLY #14

CAMC 0290268

LILLY #15

CAMC 0290269

LILLY #16

CAMC 0290270

LILLY #17

CAMC 0290271

LILLY #18

CAMC 0290272

LILLY #19

CAMC 0289957

SILVERADO #30

CAMC 0289958

SILVERADO #31

CAMC 0289960

SILVERADO #33

CAMC 0289962

SILVERADO #35

CAMC 0289963

SILVERADO #36

OTHER UNPATENTED MINING CLAIMS

On December 14, 2011, we staked and subsequently filed with the BLM, on March 13, 2012, four unpatented lode claims located in San Bernardino County, California. We have renewed the claims annually since then and an annual renewal fee of $155 is payable to the BLM prior to September 1 of each year to maintain the claims. The claims are located in Sections 7 and 18, Township 10 North, Range 1 West and Sections 12 and 13, Township 10 North, Range 2 West, San Bernardino Base & Meridian. The claims are adjacent to a historic silver mine known as the Waterman Mine (the “Waterman Claims”). There are no known reserves on these claims.

BLM Serial No.

Claim Name

CAMC302228

Silver Glance

CAMC302229

Front

CAMC302230

Omega East

CAMC302231

Alpha East

We are not presently planning any exploration activities on the Waterman Claims and the claims are not considered a material property at this time. There are no capitalized costs associated with this property.

SECTION 13 PROPERTY

On May 22, 2012, we purchased 661 acres of land (“Section 13 Property”) in fee simple for $135,684 cash, located in San Bernardino County, California, that was sold in a property tax auction conducted on behalf of the County. The parcel is all of Section 13 located in Township 7 North, Range 4 East, San Bernardino Base & Meridian.

The Section 13 property is near the Lava Beds Mining District and has evidence of historic mining. The property is located in the same regional geologic area known as the Western Mojave Block that includes our flagship Langtry Project. The property is approximately 28 miles southeast of our Langtry Project.

We do not intend to engage in any material exploration activities on the Section 13 property during the next twelve months.

CHIMNEY ROCK PROPERTY

In May 2014, we purchased 160 acres of land located in the Calico Mining District, San Bernardino County, California. The parcel is the SE quarter of Section 25, Township 10 North, Range 1 East and is mostly surrounded by public lands. It was purchased for approximately $21,000 in a property tax auction conducted on behalf of the County.

We do not intend to engage in any material exploration activities on this property during the next twelve months.

SECTION 16 PROPERTY

In August 2016, we purchased 30+/- acres of land located in the Calico Mining District, San Bernardino County, California. The parcel is in the SE quarter of Section 16, Township 10 North, Range 1 East and is adjacent to patented mining claims and public lands. It was purchased for approximately $28,600 from an unrelated third party.were assigned serial numbers NV 105804872 – NV 105804922.

 

Unpatented Mining Claims: The Mining Law of 1872

 

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

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

 

The holder of a valid unpatented mining claim has possessory title to the land covered thereby, which gives the claimant exclusive possession of the surface for mining purposes and the right to mine and remove minerals from the claim. Legal title to land encompassed by an unpatented mining claim remains in the United States, and the government can contest the validity of a mining claim. The General Mining Law requires the performance of annual assessment work for each claim, and subsequent to enactment of the Federal Land Policy and Management Act of 1976, 43 U.S.C. §1201et seq., mining claims are invalidated if evidence of assessment work is not timely filed with BLM. However, in 1993 Congress enacted a provision requiring payment of $140 per year claim maintenance fee in lieu of performing assessment work, subject to an exception for small miners having less than 10 claims. No royalty is paid to the United States with respect to minerals mined and sold from a mining claim. The current annual maintenance fee is $165 per unpatented claim payable to the Bureau of Land Management.

 

The General Mining Law provides a procedure for a qualified claimant to obtain a mineral patent (i.e., fee simple title to the mining claim) under certain conditions. It has become much more difficult in recent years to obtain a patent. Beginning in 1994, Congress imposed a funding moratorium on the processing of mineral patent applications which had not reached a designated stage in the patent process at the time the moratorium went into effect. Additionally, Congress has considered several bills in recent years to repeal the General Mining Law or to amend it to provide for the payment of royalties to the United States and to eliminate or substantially limit the patent provisions of the law.

 

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

 

Patented Mining ClaimsGOVERNMENT REGULATION

 

PatentedGeneral

Our activities are and will be subject to extensive federal, state and local laws governing the protection of the environment, prospecting, mine development, production, taxes, labor standards, occupational health, mine safety, toxic substances and other matters. The costs associated with compliance with such regulatory requirements are substantial and possible future legislation and regulations could cause additional expense, capital expenditures, restrictions and delays in the development and continued operation of our properties, the extent of which cannot be predicted. In the context of environmental permitting, including the approval of reclamation plans, we must comply with known standards and regulations which may entail significant costs and delays. Although we are committed to environmental responsibility and believe we are in substantial compliance with applicable laws and regulations, amendments to current laws and regulations, more stringent implementation of these laws and regulations through judicial review or administrative action or the adoption of new laws could have a materially adverse effect upon our results of operations.

Federal Environmental Laws

Certain mining claims,wastes from extraction and beneficiation of ores are currently exempt from the extensive set of Environmental Protection Agency (“EPA”) regulations governing hazardous waste, although such wastes may be subject to regulation under state law as our Langtry Property claims,a solid or hazardous waste. The EPA has worked on a program to regulate these mining wastes pursuant to its solid waste management authority under the Resource Conservation and Recovery Act (“RCRA”). Certain ore processing and other wastes are mining claims on federal lands that are held in fee simplecurrently regulated as hazardous wastes by the owner. No maintenance feesEPA under RCRA. If our future mine wastes, if any, were treated as hazardous waste or royalties are payable to the BLM; however lease payments and royalties are payablesuch wastes resulted in operations being designated as a “Superfund” site under the operative leases.Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA” or “Superfund”) for cleanup, material expenditures would be required for the construction of additional waste disposal facilities or for other remediation expenditures. Under CERCLA, any present owner or operator of a Superfund site or an owner or operator at the time of its contamination generally may be held liable and may be forced to undertake remedial cleanup action or to pay for the government’s cleanup efforts. Such owner or operator may also be liable to governmental entities for the cost of damages to natural resources, which may be substantial. Additional regulations or requirements may also be imposed upon our future tailings and waste disposal, if any, in Nevada under the Federal Clean Water Act (“CWA”) and state law counterparts. We have reviewed and considered current federal legislation relating to climate change and we do not believe it to have a material effect on our operations. Additional regulation or requirements under any of these laws and regulations could have a materially adverse effect upon our results of operations.

 

LOCATION, HISTORY AND GEOLOGY OF THE LANGTRY PROJECT

 

Langtry Project:

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The Langtry Project covers approximately 1,200 acres and consists of 20 patented and 2 unpatented lode mining claims held under the Strachan Lease and 36 unpatented lode mining claims with the BLM.

 

Location, Access and Composition

The Langtry Project is located in the central part of the Mojave Desert of Southern California. It is situated along the western flank of the Calico Mountains, about 10 miles northeast of Barstow in San Bernardino County. Access is good with paved county roads within a mile of the project. A rail shipping point is about five miles to the south.

The property can be accessed from Barstow by traveling north on I-15 to the Fort Irwin Road exit and traveling approximately 5.4 miles to a 4WD dirt road that leads to the claims.EXCELSIOR SPRINGS PROJECT CLAIMS

 

The following map shows the location of our Langtrythe patented and unpatented mining claims that comprise the Excelsior Springs Project claims:as of December 31, 2022:

 

 

 

Power and Water

 

Commercial power

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Excelsior Springs Project - List of ES Claims

 Claim NameNMC #ClaimantValid Until
1ES 11045871Nubian Resources USA Ltd.9/1/2023
2ES 31045873Nubian Resources USA Ltd.9/1/2023
3ES 51045875Nubian Resources USA Ltd.9/1/2023
4ES 71045877Nubian Resources USA Ltd.9/1/2023
5ES 91045879Nubian Resources USA Ltd.9/1/2023
6ES 111045881Nubian Resources USA Ltd.9/1/2023
7ES 131045883Nubian Resources USA Ltd.9/1/2023
8ES 151045885Nubian Resources USA Ltd.9/1/2023
9ES 171045887Nubian Resources USA Ltd.9/1/2023
10ES 191045889Nubian Resources USA Ltd.9/1/2023
11ES 211045891Nubian Resources USA Ltd.9/1/2023
12ES 231045893Nubian Resources USA Ltd.9/1/2023
13ES 251045895Nubian Resources USA Ltd.9/1/2023
14ES 271045897Nubian Resources USA Ltd.9/1/2023
15ES 291045899Nubian Resources USA Ltd.9/1/2023
16ES 311045901Nubian Resources USA Ltd.9/1/2023
17ES 331045903Nubian Resources USA Ltd.9/1/2023
18ES 351045905Nubian Resources USA Ltd.9/1/2023
19ES 371045907Nubian Resources USA Ltd.9/1/2023
20ES 391045909Nubian Resources USA Ltd.9/1/2023
21ES 401045910Nubian Resources USA Ltd.9/1/2023
22ES 411045911Nubian Resources USA Ltd.9/1/2023
23ES 421045912Nubian Resources USA Ltd.9/1/2023
24ES 431045913Nubian Resources USA Ltd.9/1/2023
25ES 441045914Nubian Resources USA Ltd.9/1/2023
26ES 451045915Nubian Resources USA Ltd.9/1/2023
27ES 461045916Nubian Resources USA Ltd.9/1/2023
28ES 471045917Nubian Resources USA Ltd.9/1/2023
29ES 481045918Nubian Resources USA Ltd.9/1/2023
30ES 491045919Nubian Resources USA Ltd.9/1/2023
31ES 501045920Nubian Resources USA Ltd.9/1/2023
32ES 511045921Nubian Resources USA Ltd.9/1/2023
33ES 521045922Nubian Resources USA Ltd.9/1/2023
34ES 531045923Nubian Resources USA Ltd.9/1/2023
35ES 541045924Nubian Resources USA Ltd.9/1/2023
36ES 551045925Nubian Resources USA Ltd.9/1/2023
37ES 561045926Nubian Resources USA Ltd.9/1/2023
38ES 571045927Nubian Resources USA Ltd.9/1/2023
39ES 581045928Nubian Resources USA Ltd.9/1/2023
40ES 591045929Nubian Resources USA Ltd.9/1/2023
41ES 601045930Nubian Resources USA Ltd.9/1/2023
42ES 611045931Nubian Resources USA Ltd.9/1/2023

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 Claim NameNMC#ClaimantValid Until
43ES 621045932Nubian Resources USA Ltd.9/1/2023
44ES 631045933Nubian Resources USA Ltd.9/1/2023
45ES 641045934Nubian Resources USA Ltd.9/1/2023
46ES 651045935Nubian Resources USA Ltd.9/1/2023
47ES 661045936Nubian Resources USA Ltd.9/1/2023
48ES 671045937Nubian Resources USA Ltd.9/1/2023
49ES 681045938Nubian Resources USA Ltd.9/1/2023
50ES 691045939Nubian Resources USA Ltd.9/1/2023
51ES 701045940Nubian Resources USA Ltd.9/1/2023
52ES 711045941Nubian Resources USA Ltd.9/1/2023
53ES 721045942Nubian Resources USA Ltd.9/1/2023
54ES 731045943Nubian Resources USA Ltd.9/1/2023
55ES 741045944Nubian Resources USA Ltd.9/1/2023
56ES 751045945Nubian Resources USA Ltd.9/1/2023
57ES 761045946Nubian Resources USA Ltd.9/1/2023
58ES 771045947Nubian Resources USA Ltd.9/1/2023
59ES 781045948Nubian Resources USA Ltd.9/1/2023
60ES 791045949Nubian Resources USA Ltd.9/1/2023
61ES 801045950Nubian Resources USA Ltd.9/1/2023
62ES 811045951Nubian Resources USA Ltd.9/1/2023
63ES 821045952Nubian Resources USA Ltd.9/1/2023
64ES 831045953Nubian Resources USA Ltd.9/1/2023
65ES 841045954Nubian Resources USA Ltd.9/1/2023
66ES 851045955Nubian Resources USA Ltd.9/1/2023
67ES 861045956Nubian Resources USA Ltd.9/1/2023
68ES 871045957Nubian Resources USA Ltd.9/1/2023
69ES 881045958Nubian Resources USA Ltd.9/1/2023
70ES 891045959Nubian Resources USA Ltd.9/1/2023
71ES 901045960Nubian Resources USA Ltd.9/1/2023
72ES 911045961Nubian Resources USA Ltd.9/1/2023
73ES 921045962Nubian Resources USA Ltd.9/1/2023
74ES 931045963Nubian Resources USA Ltd.9/1/2023
75ES 941045964Nubian Resources USA Ltd.9/1/2023
76ES 951045965Nubian Resources USA Ltd.9/1/2023
77ES 961045966Nubian Resources USA Ltd.9/1/2023
78ES 971045967Nubian Resources USA Ltd.9/1/2023
79ES 981045968Nubian Resources USA Ltd.9/1/2023
80ES 991045969Nubian Resources USA Ltd.9/1/2023
81ES 1001045970Nubian Resources USA Ltd.9/1/2023
82ES1031057362Nubian Resources USA Ltd.9/1/2023
83ES1051057364Nubian Resources USA Ltd.9/1/2023
84ES1071057366Nubian Resources USA Ltd.9/1/2023

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 Claim NameNMC#ClaimantValid Until
85ES1091057368Nubian Resources USA Ltd.9/1/2023
86ES1761057394Nubian Resources USA Ltd.9/1/2023
87ES1791057395Nubian Resources USA Ltd.9/1/2023
88ES1801057396Nubian Resources USA Ltd.9/1/2023
89ES2451057460Nubian Resources USA Ltd.9/1/2023
90ES2461057461Nubian Resources USA Ltd.9/1/2023
91ES2471057462Nubian Resources USA Ltd.9/1/2023
92ES2481057463Nubian Resources USA Ltd.9/1/2023
93ES2491057464Nubian Resources USA Ltd.9/1/2023
94ES2501057465Nubian Resources USA Ltd.9/1/2023
95ES2511057466Nubian Resources USA Ltd.9/1/2023
96ES2521057467Nubian Resources USA Ltd.9/1/2023
97ES2531057468Nubian Resources USA Ltd.9/1/2023
98ES2541057469Nubian Resources USA Ltd.9/1/2023

Excelsior Springs Project - List of EX Claims

 Claim NameNMC #ClaimantValid Until
1EX 1887756Nubian Resources USA Ltd.9/1/2023
2EX 2887757Nubian Resources USA Ltd.9/1/2023
3EX 3887758Nubian Resources USA Ltd.9/1/2023
4EX 4887759Nubian Resources USA Ltd.9/1/2023
5EX 5887760Nubian Resources USA Ltd.9/1/2023
6EX 6887761Nubian Resources USA Ltd.9/1/2023
7EX 7887762Nubian Resources USA Ltd.9/1/2023
8EX 8887763Nubian Resources USA Ltd.9/1/2023
9EX 9887764Nubian Resources USA Ltd.9/1/2023
10EX 10887765Nubian Resources USA Ltd.9/1/2023
11EX 11887766Nubian Resources USA Ltd.9/1/2023
12EX 12887767Nubian Resources USA Ltd.9/1/2023
13EX 13887768Nubian Resources USA Ltd.9/1/2023
14EX 14887769Nubian Resources USA Ltd.9/1/2023
15EX 20897986Nubian Resources USA Ltd.9/1/2023
16EX 21897987Nubian Resources USA Ltd.9/1/2023
17EX 22897988Nubian Resources USA Ltd.9/1/2023
18EX 23897989Nubian Resources USA Ltd.9/1/2023

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 Claim NameNMC #ClaimantValid Until
19EX 24897990Nubian Resources USA Ltd.9/1/2023
20EX 25897991Nubian Resources USA Ltd.9/1/2023
21EX 26897992Nubian Resources USA Ltd.9/1/2023
22EX 27897993Nubian Resources USA Ltd.9/1/2023
23EX 28897994Nubian Resources USA Ltd.9/1/2023
24EX 29897995Nubian Resources USA Ltd.9/1/2023
25EX 30897996Nubian Resources USA Ltd.9/1/2023
26EX 31897997Nubian Resources USA Ltd.9/1/2023
27EX 32897998Nubian Resources USA Ltd.9/1/2023
28EX 33897999Nubian Resources USA Ltd.9/1/2023
29EX 34898000Nubian Resources USA Ltd.9/1/2023
30EX 35898001Nubian Resources USA Ltd.9/1/2023
31EX 36898002Nubian Resources USA Ltd.9/1/2023
32EX 37898003Nubian Resources USA Ltd.9/1/2023
33EX 38898004Nubian Resources USA Ltd.9/1/2023
34EX 39898005Nubian Resources USA Ltd.9/1/2023
35EX 40898006Nubian Resources USA Ltd.9/1/2023
36EX 41898007Nubian Resources USA Ltd.9/1/2023
37EX 42898008Nubian Resources USA Ltd.9/1/2023
38EX 43898009Nubian Resources USA Ltd.9/1/2023
39EX 44898010Nubian Resources USA Ltd.9/1/2023
40EX 45898011Nubian Resources USA Ltd.9/1/2023
41EX 46898012Nubian Resources USA Ltd.9/1/2023
42EX 47898013Nubian Resources USA Ltd.9/1/2023

Additional Claim blocks ES 2R – ES 38R and BL 1 – BL 32 were staked by Nubian Resources USA Ltd. in September and October 2022 and filed with the BLM in December 2022 and were assigned serial numbers NV 105804872 – NV 105804922.

Unpatented Mining Claims: The Mining Law of 1872

Except for the Langtry Property, our mineral rights consist of leases covering "unpatented" mining claims created and maintained in accordance with the U.S. General Mining Law of 1872, or the “General Mining Law.” Unpatented mining claims are unique U.S. property interests, and are generally considered to be subject to greater title risk than other real property interests because the validity of unpatented mining claims is available about 3 miles westoften uncertain. The validity of an unpatented mining claim, in terms of both its location and its maintenance, is dependent on strict compliance with a complex body of federal and state statutory and decisional law that supplement the General Mining Law. Also, unpatented mining claims and related rights, including rights to use the surface, are subject to possible challenges by third parties or contests by the federal government. In addition, there are few public records that definitively control the issues of validity and ownership of unpatented mining claims. We have not filed a patent application for any of our unpatented mining claims that are located on federal public lands in the United States and, under possible future legislation to change the General Mining Law, patents may be difficult to obtain.

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Location of mining claims under the General Mining Law, is a self-initiation system under which a person physically stakes an unpatented mining claim on public land that is open to location, posts a location notice and monuments the boundaries of the Project.

A likely sourceclaim in compliance with federal laws and regulations and with state location laws, and files notice of process water would be groundwater produced from an alluvial or regional aquifer. Based upon a hydrologic investigation ofthat location in the Marine Corps Logistics Base, Nebocounty records and Yermo Annexes, near Barstow, California, conducted by the U.S. Geological Survey (1997), such aquifers may exist in major washes associated with the Calico Mountains.1

We continueBLM. Mining claims can be located on land as to investigatewhich the surface was patented into private ownership under the Stockraising Homestead Act of 1916, 43 U.S.C. §299, but the mining claimant cannot injure, damage or destroy the surface owner's permanent improvements and evaluate but have not secured commercial sourcesmust pay for damage to crops caused by prospecting. Discovery of powera valuable mineral deposit, as defined under federal law, is essential to the validity of an unpatented mining claim and is required on each mining claim individually. The location is made as a lode claim for mineral deposits found as veins or water yet.

Geologyrock in place, or as a placer claim for other deposits. While the maximum size and shape of lode claims and placer claims are established by statute, there are no limits on the number of claims one person may locate or own. The General Mining Law also contains provision for acquiring five-acre claims of non-mineral land for millsite purposes. A mining operation typically is comprised of many mining claims.

 

The large tonnage, modest grade disseminated silver-barite mineralization at Langtry is hostedholder of a valid unpatented mining claim has possessory title to the land covered thereby, which gives the claimant exclusive possession of the surface for mining purposes and the right to mine and remove minerals from the claim. Legal title to land encompassed by the Barstow Formation, a brecciated sequence of Miocene age siltstones, sandstones, some thin bedded calcarenites, and water laid tuffs that were deposited in a shallow lake environment. These sediments are underlain by volcanic flows and breccias of primarily dacitic to andesitic composition (Pickhandle Formation). Both vein mineralization, hostedan unpatented mining claim remains in the Pickhandle Formation,United States, and the disseminated mineralization hostedgovernment can contest the validity of a mining claim. The General Mining Law requires the performance of annual assessment work for each claim, and subsequent to enactment of the Federal Land Policy and Management Act of 1976, 43 U.S.C. §1201 et seq., mining claims are invalidated if evidence of assessment work is not timely filed with BLM. However, in 1993 Congress enacted a provision requiring payment of $140 per year claim maintenance fee in lieu of performing assessment work, subject to an exception for small miners having less than 10 claims. No royalty is paid to the overlying Barstow Formation are believedUnited States with respect to have formedminerals mined and sold from a common event, withmining claim. The current annual maintenance fee is $165 per unpatented claim payable to the host rock controlling the styleBureau of mineralization. The vein network generally parallels a regional zone of northwestern-trending faults that has acted as both a feeder for mineralization and has displaced it during periods of reactivation.Land Management.

 

The disseminated silver mineralization, hostedGeneral Mining Law provides a procedure for a qualified claimant to obtain a mineral patent (i.e., fee simple title to the mining claim) under certain conditions. It has become much more difficult in recent years to obtain a patent. Beginning in 1994, Congress imposed a funding moratorium on the processing of mineral patent applications which had not reached a designated stage in the brecciated Barstow Formation, consists of pervasive silicification with barite, grading with depth to quartz with lesser barite, minor hematite, calcite, and silver bearing sulfides, mostly acanthite with very fine grained native silver. Sphalerite and galena were identified from microscopy in grains typically smaller than 25 microns. Argentojarocite and cerargyrite are also reported locally. A separate event with magnetite and manganese oxide and silver mineralization is also known from the district.

The host rock type for the Langtry mineralization is the Miocene age Barstow formation. This is a sedimentary sequence of sandstone, mudstone, siltstone, and locally silty limestone.

The Langtry deposit is intersected by multiple faults. The most prominent is the Calico fault that is located along the southwest side of the mineralization. The fault is interpreted to be right laterial with displacement as much as several miles horizontally and several hundred feet vertically. There are numerous “splay” faults form the Calico of which at least two are interpreted to cross the Langtry deposit striking east to north east.

The northeastern boundary of the deposit is defined by an un-named fault that strikes more to the northwest than the Calico fault. This boundary fault occurs almost immediately at the toe of the mountains that lie immediately north of the Langtry Deposit. The north bounding fault and the Calico fault intersect at the east end of the Langtry Deposit.

Numerous silver bearing veins are hosted within the Barstow formation. These are often high grade when compared to the surrounding rock mass.

History

Early mining in the Calico District was most active during the period 1881 to 1896. During that time an estimated 20 million ounces of silver were mined by underground methods from veins, mostly in the Wall Street Canyon and Odessa Canyon areas, on the south end of the Calico Mountains, just north of the historic town of Calico. Calico is now a ghost town and California state park.

The earliest report on the Langtry Mines was published by the California State Mining Bureau (1896). The report states:

“They [the Langtry Mines] are 5 miles west of Calico, and comprise a group of claims upon which considerable work has been done. The veins are fissures in tufa, and are the only veins in this district entitled to be called fissures. The strike is E. and W. and the dip 80° N. The tufa lies in nearly horizontal beds. The main filling is baryta [barium hydroxide] and quartz containing chloride of silver, iron oxide, and carbonate of lead. Idle.T. N. Stebbins, of Daggett, owner.”

Around 1967, the Superior Oil Company, Minerals Division, began exploration in the area of the old Langtry Mine. The Superior Oil program resulted in the discovery of a bulk minable disseminated silver deposit. The principal development work consisted of more than 200 drill holes, most drilled to depths of about 500 feet, surface trenches, and access roads. Most of the boreholes were rotary drilled, although some were core drilled. Rotary cuttings were collected on 5-ft or 10-ft intervals and assayed; core was assayed at approximately 10-ft intervals. The assay data for each hole were recorded by Superior Oil on Graphic Drill Logs, 198 of which are available with assays. Silver, in ounces per ton, was reported for every hole, even if it was reported as “trace.” Percent barite (BaSO4) was reported for many holes, and lead assays were reported for a limited number of holes. Laboratory reports for these data are not available.

At the behest of Superior Oil Company, the BLM prepared a Mineral Validity Report (BLM, 1974) evaluating Mineral Patent Application No. R-4645. The application was filed by Title Insurance and Trust Company, agent for Superior Oil Company, for 21 lode mining claims located in T.10 N., R. 1 E., Sections 6, 7, 8, and totaling 433.881 acres. The BLM verified drill sites on the individual claims; drilled twin holes; collected 62 check samples that were assayed by Skyline Labs, Inc. in Tucson, Arizona; correlated assay data for each claim; and excavated surface cuts and trenches to expose sample locations where the ore deposit cropped out near the surface.

Superior received a patent for 20 of the 21 claims applied for which comprise the claims now held under the option/lease agreement between Strachan and Athena. The claim not approved for patent known as Lilly 10 or Quad Deuce XIII is also held under the option lease agreement between Strachan and Athena.

Current State of Exploration and Development

Our current focus is primarily on the exploration of our Langtry Property.

Athena conducted a 13-hole confirmation drilling program performed by us in January and February 2011. Our drilling program consisted of 10 vertical holes drilled to depths of between 350’ to 575’for a total of 4,285’ to test the results of a much larger historic drilling program conducted by Superior Oil Company; and three angle holes drilled to a depth of between 500’ and 600’ for a total of 1,700’ were exploratory as they targeted veins near 19th century historic workings on the Property and were not intended to replicate any prior drill holes.

We are currently working with our consultants to develop additional exploration plans subject to available funding. Future work could include core drilling and metallurgical studies but no firm plans or budgets have been completed. Any proposed program would be exploratory in nature.

Future lease payments and/or exploration and development of this property will require new equity and/or debt capital.

No Proven or Probable Mineral Reserves/Exploration Stage Company

We are considered an exploration stage company under SEC criteria since we have not demonstrated the existence of proven or probable mineral reserves at any of our properties. In Industry Guide 7, the SEC defines a “reserve” as that part of a mineral deposit which could be economically and legally extracted or producedprocess at the time the moratorium went into effect. Additionally, Congress has considered several bills in recent years to repeal the General Mining Law or to amend it to provide for the payment of royalties to the United States and to eliminate or substantially limit the patent provisions of the reserve determination. Proven or probable mineral reserves are those reserves for which (a) quantity is computed and (b) the sites for inspection, sampling, and measurement are spaced so closely that the geologic character is defined and size, shape and depth of mineral content can be established (proven) or the sites are farther apart or are otherwise less adequately spaced but high enough to assume continuity between observation points (probable). Mineral Reserves cannot be considered proven or probable unless and until they are supported by a feasibility study, indicating that the mineral reserves have had the requisite geologic, technical and economic work performed and are economically and legally extractable.law.

 

We have not completed a feasibility study with regardMining claims are conveyed by deed, or leased by the claimant to all or a portion of any of our properties to date. Any mineralized material discovered or extracted by us should not be considered proven or probable mineral reserves. As of December 31, 2016, none of our mineralized material met the definition of proven or probable mineral reserves. We expect to remain an exploration stage company for the foreseeable future, even though we were extracting and processing mineralized material. We will not exit the exploration stage until such time, if ever, that we demonstrate the existence of proven or probable mineral reserves that meet the guidelines under SEC Industry Guide 7.

OUR EXPLORATION PROCESS

Our exploration program is designed to acquire, explore and evaluate exploration properties in an economically efficient manner. We have not at this time identified or delineated any mineral reserves on any of our properties.

We expect our exploration work on a given property to proceed generally in three phases. Decisions about proceeding to each successive phase will take into consideration the completion of the previous phases and our analysis of the results of those phases.

The first phase is intended to determine whether a prospect warrants further exploration and involves:

researching the available geologic literature; 

interviewing geologists, mining engineers and others familiar with the prospect sites; 

conducting geologic mapping, geophysical testing and geochemical testing; 

examining any existing workings, such as trenches, prospect pits, shafts or tunnels; 

digging trenches that allow for an examination of surface vein structures as well as for efficient reclamation, re-contouring and re-seeding of disturbed areas; and, 

analyzing samples for minerals that are known to have occurred in the test area. 

Subject to obtaining the necessary permits in a timely manner, the first phase can typically be completed on an individual property in several months at a cost of less than $200,000.

The second phase is intended to identify any mineral deposits of potential economic importance and would involve:

examining underground characteristics of mineralization that were previously identified; 

conducting more detailed geologic mapping; 

conducting more advanced geochemical and geophysical surveys; 

conducting more extensive trenching; and 

conducting exploratory drilling. 

Subject to obtaining the necessary permits in a timely manner, the second phase can typically be completed on an individual property in nine to twelve months at a cost of less than $1 million. None of our properties has reached the second phase.

The third phase is intended to precisely define depth, width, length, tonnage and value per ton of any deposit that has been identified and would involve:

drillingparty seeking to develop the mining site; 

conducting metallurgical testing;property. Such a deed or lease (or memorandum of it) needs to be recorded in the real property records of the county where the property is located, and

obtaining other pertinent technical information requiredevidence of such transfer needs to define an orebe filed with BLM. It is not unusual for the grantor or lessor to reserve and complete a feasibility study. royalty, which as to precious metals often is expressed as a percentage of net smelter returns.

 

Depending upon the nature of the particular deposit, the third phase on any one property could take one to five years or more and cost well in excess of $1 million. None of our properties has reached the third phase.

We intend to explore and develop our properties ourselves, although our plans could change depending on the terms and availability of financing and the terms or merits of any joint venture proposals.

SILVER PRICES

Our operating results are substantially dependent upon the world market prices of silver. We have no control over silver prices, which can fluctuate widely. The volatility of such prices is illustrated by the following table, which sets forth the high and low London Fix prices of silver (as reported bywww.kitco.com) per ounce during the periods indicated:

 

 

Year Ended December 31,

 

 

 

2016

 

2015

 

2014

 

 

 

High

 

Low

 

High

 

Low

 

High

 

Low

 

Silver

 

$

20.71

$

 

13.58

 

$

18.23

 

$

13.71

 

$

22.05

 

$

15.28

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

These historical prices are not indicative of future silver prices.

MARKETING

All of our mining operations, if successful, will produce silver in doré form or a concentrate that contains silver.

We plan to market our refined metal and doré to credit worthy bullion trading houses, market makers and members of the London Bullion Market Association, industrial companies and sound financial institutions. The refined metals will be sold to end users for use in electronic circuitry, jewelry, silverware, and the pharmaceutical and technology industries. Generally, the loss of a single bullion trading counterparty would not adversely affect us due to the liquidity of the markets and the availability of alternative trading counterparties.

We plan to refine and market its precious metals doré and concentrates using a geographically diverse group of third party smelters and refiners. The loss of any one smelting and refining client may have a material adverse effect if alternate smelters and refiners are not available. We believe there is sufficient global capacity available to address the loss of any one smelter.

GOVERNMENT REGULATION

 

General

 

Our activities are and will be subject to extensive federal, state and local laws governing the protection of the environment, prospecting, mine development, production, taxes, labor standards, occupational health, mine safety, toxic substances and other matters. The costs associated with compliance with such regulatory requirements are substantial and possible future legislation and regulations could cause additional expense, capital expenditures, restrictions and delays in the development and continued operation of our properties, the extent of which cannot be predicted. In the context of environmental permitting, including the approval of reclamation plans, we must comply with known standards and regulations which may entail significant costs and delays. Although we are committed to environmental responsibility and believe we are in substantial compliance with applicable laws and regulations, amendments to current laws and regulations, more stringent implementation of these laws and regulations through judicial review or administrative action or the adoption of new laws could have a materially adverse effect upon our results of operations.

 

Federal Environmental Laws

 

Certain mining wastes from extraction and beneficiation of ores are currently exempt from the extensive set of Environmental Protection Agency (“EPA”) regulations governing hazardous waste, although such wastes may be subject to regulation under state law as a solid or hazardous waste. The EPA has worked on a program to regulate these mining wastes pursuant to its solid waste management authority under the Resource Conservation and Recovery Act (“RCRA”). Certain ore processing and other wastes are currently regulated as hazardous wastes by the EPA under RCRA. If our future mine wastes, if any, were treated as hazardous waste or such wastes resulted in operations being designated as a “Superfund” site under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA” or “Superfund”) for cleanup, material expenditures would be required for the construction of additional waste disposal facilities or for other remediation expenditures. Under CERCLA, any present owner or operator of a Superfund site or an owner or operator at the time of its contamination generally may be held liable and may be forced to undertake remedial cleanup action or to pay for the government’s cleanup efforts. Such owner or operator may also be liable to governmental entities for the cost of damages to natural resources, which may be substantial. Additional regulations or requirements may also be imposed upon our future tailings and waste disposal, if any, in Nevada under the Federal Clean Water Act (“CWA”) and state law counterparts. We have reviewed and considered current federal legislation relating to climate change and we do not believe it to have a material effect on our operations. Additional regulation or requirements under any of these laws and regulations could have a materially adverse effect upon our results of operations.

 

12

EXCELSIOR SPRINGS PROJECT CLAIMS

The following map shows the location of the patented and unpatented mining claims that comprise the Excelsior Springs Project as of December 31, 2022:

13

Excelsior Springs Project - List of ES Claims

 Claim NameNMC #ClaimantValid Until
1ES 11045871Nubian Resources USA Ltd.9/1/2023
2ES 31045873Nubian Resources USA Ltd.9/1/2023
3ES 51045875Nubian Resources USA Ltd.9/1/2023
4ES 71045877Nubian Resources USA Ltd.9/1/2023
5ES 91045879Nubian Resources USA Ltd.9/1/2023
6ES 111045881Nubian Resources USA Ltd.9/1/2023
7ES 131045883Nubian Resources USA Ltd.9/1/2023
8ES 151045885Nubian Resources USA Ltd.9/1/2023
9ES 171045887Nubian Resources USA Ltd.9/1/2023
10ES 191045889Nubian Resources USA Ltd.9/1/2023
11ES 211045891Nubian Resources USA Ltd.9/1/2023
12ES 231045893Nubian Resources USA Ltd.9/1/2023
13ES 251045895Nubian Resources USA Ltd.9/1/2023
14ES 271045897Nubian Resources USA Ltd.9/1/2023
15ES 291045899Nubian Resources USA Ltd.9/1/2023
16ES 311045901Nubian Resources USA Ltd.9/1/2023
17ES 331045903Nubian Resources USA Ltd.9/1/2023
18ES 351045905Nubian Resources USA Ltd.9/1/2023
19ES 371045907Nubian Resources USA Ltd.9/1/2023
20ES 391045909Nubian Resources USA Ltd.9/1/2023
21ES 401045910Nubian Resources USA Ltd.9/1/2023
22ES 411045911Nubian Resources USA Ltd.9/1/2023
23ES 421045912Nubian Resources USA Ltd.9/1/2023
24ES 431045913Nubian Resources USA Ltd.9/1/2023
25ES 441045914Nubian Resources USA Ltd.9/1/2023
26ES 451045915Nubian Resources USA Ltd.9/1/2023
27ES 461045916Nubian Resources USA Ltd.9/1/2023
28ES 471045917Nubian Resources USA Ltd.9/1/2023
29ES 481045918Nubian Resources USA Ltd.9/1/2023
30ES 491045919Nubian Resources USA Ltd.9/1/2023
31ES 501045920Nubian Resources USA Ltd.9/1/2023
32ES 511045921Nubian Resources USA Ltd.9/1/2023
33ES 521045922Nubian Resources USA Ltd.9/1/2023
34ES 531045923Nubian Resources USA Ltd.9/1/2023
35ES 541045924Nubian Resources USA Ltd.9/1/2023
36ES 551045925Nubian Resources USA Ltd.9/1/2023
37ES 561045926Nubian Resources USA Ltd.9/1/2023
38ES 571045927Nubian Resources USA Ltd.9/1/2023
39ES 581045928Nubian Resources USA Ltd.9/1/2023
40ES 591045929Nubian Resources USA Ltd.9/1/2023
41ES 601045930Nubian Resources USA Ltd.9/1/2023
42ES 611045931Nubian Resources USA Ltd.9/1/2023

14

 Claim NameNMC#ClaimantValid Until
43ES 621045932Nubian Resources USA Ltd.9/1/2023
44ES 631045933Nubian Resources USA Ltd.9/1/2023
45ES 641045934Nubian Resources USA Ltd.9/1/2023
46ES 651045935Nubian Resources USA Ltd.9/1/2023
47ES 661045936Nubian Resources USA Ltd.9/1/2023
48ES 671045937Nubian Resources USA Ltd.9/1/2023
49ES 681045938Nubian Resources USA Ltd.9/1/2023
50ES 691045939Nubian Resources USA Ltd.9/1/2023
51ES 701045940Nubian Resources USA Ltd.9/1/2023
52ES 711045941Nubian Resources USA Ltd.9/1/2023
53ES 721045942Nubian Resources USA Ltd.9/1/2023
54ES 731045943Nubian Resources USA Ltd.9/1/2023
55ES 741045944Nubian Resources USA Ltd.9/1/2023
56ES 751045945Nubian Resources USA Ltd.9/1/2023
57ES 761045946Nubian Resources USA Ltd.9/1/2023
58ES 771045947Nubian Resources USA Ltd.9/1/2023
59ES 781045948Nubian Resources USA Ltd.9/1/2023
60ES 791045949Nubian Resources USA Ltd.9/1/2023
61ES 801045950Nubian Resources USA Ltd.9/1/2023
62ES 811045951Nubian Resources USA Ltd.9/1/2023
63ES 821045952Nubian Resources USA Ltd.9/1/2023
64ES 831045953Nubian Resources USA Ltd.9/1/2023
65ES 841045954Nubian Resources USA Ltd.9/1/2023
66ES 851045955Nubian Resources USA Ltd.9/1/2023
67ES 861045956Nubian Resources USA Ltd.9/1/2023
68ES 871045957Nubian Resources USA Ltd.9/1/2023
69ES 881045958Nubian Resources USA Ltd.9/1/2023
70ES 891045959Nubian Resources USA Ltd.9/1/2023
71ES 901045960Nubian Resources USA Ltd.9/1/2023
72ES 911045961Nubian Resources USA Ltd.9/1/2023
73ES 921045962Nubian Resources USA Ltd.9/1/2023
74ES 931045963Nubian Resources USA Ltd.9/1/2023
75ES 941045964Nubian Resources USA Ltd.9/1/2023
76ES 951045965Nubian Resources USA Ltd.9/1/2023
77ES 961045966Nubian Resources USA Ltd.9/1/2023
78ES 971045967Nubian Resources USA Ltd.9/1/2023
79ES 981045968Nubian Resources USA Ltd.9/1/2023
80ES 991045969Nubian Resources USA Ltd.9/1/2023
81ES 1001045970Nubian Resources USA Ltd.9/1/2023
82ES1031057362Nubian Resources USA Ltd.9/1/2023
83ES1051057364Nubian Resources USA Ltd.9/1/2023
84ES1071057366Nubian Resources USA Ltd.9/1/2023

15

 Claim NameNMC#ClaimantValid Until
85ES1091057368Nubian Resources USA Ltd.9/1/2023
86ES1761057394Nubian Resources USA Ltd.9/1/2023
87ES1791057395Nubian Resources USA Ltd.9/1/2023
88ES1801057396Nubian Resources USA Ltd.9/1/2023
89ES2451057460Nubian Resources USA Ltd.9/1/2023
90ES2461057461Nubian Resources USA Ltd.9/1/2023
91ES2471057462Nubian Resources USA Ltd.9/1/2023
92ES2481057463Nubian Resources USA Ltd.9/1/2023
93ES2491057464Nubian Resources USA Ltd.9/1/2023
94ES2501057465Nubian Resources USA Ltd.9/1/2023
95ES2511057466Nubian Resources USA Ltd.9/1/2023
96ES2521057467Nubian Resources USA Ltd.9/1/2023
97ES2531057468Nubian Resources USA Ltd.9/1/2023
98ES2541057469Nubian Resources USA Ltd.9/1/2023

Excelsior Springs Project - List of EX Claims

 Claim NameNMC #ClaimantValid Until
1EX 1887756Nubian Resources USA Ltd.9/1/2023
2EX 2887757Nubian Resources USA Ltd.9/1/2023
3EX 3887758Nubian Resources USA Ltd.9/1/2023
4EX 4887759Nubian Resources USA Ltd.9/1/2023
5EX 5887760Nubian Resources USA Ltd.9/1/2023
6EX 6887761Nubian Resources USA Ltd.9/1/2023
7EX 7887762Nubian Resources USA Ltd.9/1/2023
8EX 8887763Nubian Resources USA Ltd.9/1/2023
9EX 9887764Nubian Resources USA Ltd.9/1/2023
10EX 10887765Nubian Resources USA Ltd.9/1/2023
11EX 11887766Nubian Resources USA Ltd.9/1/2023
12EX 12887767Nubian Resources USA Ltd.9/1/2023
13EX 13887768Nubian Resources USA Ltd.9/1/2023
14EX 14887769Nubian Resources USA Ltd.9/1/2023
15EX 20897986Nubian Resources USA Ltd.9/1/2023
16EX 21897987Nubian Resources USA Ltd.9/1/2023
17EX 22897988Nubian Resources USA Ltd.9/1/2023
18EX 23897989Nubian Resources USA Ltd.9/1/2023

16

 Claim NameNMC #ClaimantValid Until
19EX 24897990Nubian Resources USA Ltd.9/1/2023
20EX 25897991Nubian Resources USA Ltd.9/1/2023
21EX 26897992Nubian Resources USA Ltd.9/1/2023
22EX 27897993Nubian Resources USA Ltd.9/1/2023
23EX 28897994Nubian Resources USA Ltd.9/1/2023
24EX 29897995Nubian Resources USA Ltd.9/1/2023
25EX 30897996Nubian Resources USA Ltd.9/1/2023
26EX 31897997Nubian Resources USA Ltd.9/1/2023
27EX 32897998Nubian Resources USA Ltd.9/1/2023
28EX 33897999Nubian Resources USA Ltd.9/1/2023
29EX 34898000Nubian Resources USA Ltd.9/1/2023
30EX 35898001Nubian Resources USA Ltd.9/1/2023
31EX 36898002Nubian Resources USA Ltd.9/1/2023
32EX 37898003Nubian Resources USA Ltd.9/1/2023
33EX 38898004Nubian Resources USA Ltd.9/1/2023
34EX 39898005Nubian Resources USA Ltd.9/1/2023
35EX 40898006Nubian Resources USA Ltd.9/1/2023
36EX 41898007Nubian Resources USA Ltd.9/1/2023
37EX 42898008Nubian Resources USA Ltd.9/1/2023
38EX 43898009Nubian Resources USA Ltd.9/1/2023
39EX 44898010Nubian Resources USA Ltd.9/1/2023
40EX 45898011Nubian Resources USA Ltd.9/1/2023
41EX 46898012Nubian Resources USA Ltd.9/1/2023
42EX 47898013Nubian Resources USA Ltd.9/1/2023

Additional Claim blocks ES 2R – ES 38R and BL 1 – BL 32 were staked by Nubian Resources USA Ltd. in September and October 2022 and filed with the BLM in December 2022 and were assigned serial numbers NV 105804872 – NV 105804922.

Unpatented Mining Claims: The Mining Law of 1872

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

17

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

The holder of a valid unpatented mining claim has possessory title to the land covered thereby, which gives the claimant exclusive possession of the surface for mining purposes and the right to mine and remove minerals from the claim. Legal title to land encompassed by an unpatented mining claim remains in the United States, and the government can contest the validity of a mining claim. The General Mining Law requires the performance of annual assessment work for each claim, and subsequent to enactment of the Federal Land Policy and Management Act of 1976, 43 U.S.C. §1201 et seq., mining claims are invalidated if evidence of assessment work is not timely filed with BLM. However, in 1993 Congress enacted a provision requiring payment of $140 per year claim maintenance fee in lieu of performing assessment work, subject to an exception for small miners having less than 10 claims. No royalty is paid to the United States with respect to minerals mined and sold from a mining claim. The current annual maintenance fee is $165 per unpatented claim payable to the Bureau of Land Management.

The General Mining Law provides a procedure for a qualified claimant to obtain a mineral patent (i.e., fee simple title to the mining claim) under certain conditions. It has become much more difficult in recent years to obtain a patent. Beginning in 1994, Congress imposed a funding moratorium on the processing of mineral patent applications which had not reached a designated stage in the patent process at the time the moratorium went into effect. Additionally, Congress has considered several bills in recent years to repeal the General Mining Law or to amend it to provide for the payment of royalties to the United States and to eliminate or substantially limit the patent provisions of the law.

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

Patented Mining Claims

Patented mining claims, such as the two patented claims included in the Excelsior Springs project, are mining claims on federal lands that are held in fee simple by the owner.  No maintenance fees or royalties are payable to the BLM; however, lease payments and royalties are payable under the operative leases.

18

GOLD PRICES

Our operating results are substantially dependent upon the world market prices of silver. We have no control over gold prices, which can fluctuate widely. The volatility of such prices is illustrated by the following table, which sets forth the high and low London Fix prices of gold (as reported by www.kitco.com) per ounce during the periods indicated:

Year High  Low 
2017 $1,346  $1,151 
2018 $1,355  $1,178 
2019 $1,546  $1,270 
2020 $2,067  $1,474 
2021 $1,943  $1,684 
2022 $2,039  $1,628 

These historical prices are not indicative of future gold prices.

EMPLOYEES AND CONSULTANTS

 

We have only one part-time employee, Mr. Power, who devotes approximately 25% of his time and attention to our business.  We have agreed to pay Mr. Power $2,500 per month for his services.

 

We rely heavily on the services of consulting engineers and geologists.

 

ITEM 1A – RISK FACTORS.

 

An investment in our securities is speculative and involves a high degree of risk. Please carefully consider the following risk factors, as well as the possibility of the loss of your entire investment, before deciding to invest in our securities.

 

Risks Related to our Business

 

Due to our history of operating losses our auditors are uncertain that we will be ablehave expressed substantial doubt about our ability to continue as a going concern.

Our financial statements have been prepared assuming that we will continue as a going concern. Due to our continuing operating losses and negative cash flows from our operations, the reportsreport of our auditors issued in connection with our financial statements for the years ended December 31, 20162022, and 2015,2021 contain explanatory paragraphs indicating that the foregoing matters raised substantial doubt about our ability to continue as a going concern. We cannot provide any assurance that we will be able to continue as a going concernconcern.

Uncontrollable events like the COVID-19 pandemic may negatively impact our operations.

The occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. A pandemic typically results in social distancing, travel bans and quarantine, and this may limit access to our facilities, customers, management, support staff and professional advisors. These factors, in turn, may not only impact our operations, financial condition and demand for our goods and services but our overall ability to react timely to mitigate the impact of this event. Also, it may hamper our efforts to comply with our filing obligations with the Securities and Exchange Commission.

19

 

We have no history of or experience in mineral production.

 

We have no history of or experience in producing silvergold or other metals. The development of our LangtryExcelsior Springs Project would require the construction and operation of mines, processing plants, and related infrastructure. As a result, we would be subject to all of the risks associated with establishing a new mining operation and business enterprise. We may never successfully establish mining operations, and any such operations may not achieve profitability.

 

Our principal shareholders and control persons are also principal shareholders and control persons of Athena, Magellan Gold and Silver Saddle, which could result in conflicts with the interests of minority stockholders.

 

Magellan Gold Corporation (“Magellan”) is a publicly-held company under common control. Mr. Power is our President, CEO and a director and is a former officer and director of Magellan. John Gibbs is a significant shareholder of both Athena and Magellan.

Messrs. Gibbs and Power are control persons and principal shareholders of Athena Magellan and Silver Saddle. Athena, Magellan and Silver Saddle are engaged in mineral exploration activities, although in different geographical regions. While the geographical focus of the companies is different, numerous conflicts could arise in the future. For example, Messrs. Gibbs and Power have provided the majority of working capital for all three companies to date, and in the likely event that these companies require additional capital in the future, their resources may be inadequate to finance the activities of all. In addition, if new prospects become available, a conflict may exist with respect to which company to offer those opportunities. Messrs. Gibbs and Power have not developed a conflict of interest policy to mitigate the potential adverse effects of these conflicts and as a result these conflicts represent a significant risk to the shareholders of the Company. Conflicts for access to limited resources and opportunities cannot be eliminated completely, and investors should be aware of their potential.

 

Our principal executive officer intends to devote only a limited amount of his time and attention to our business.

 

Mr. Power is the principalonly executive officer of both Athena and Magellan.Athena. He anticipates that he will only devote approximately 25% of his time and attention to our business. This limited focus could result in significant delays in our exploration and development activities and ability to generate revenues and profits, if any, in the future.

 

We have no proven or probable reserves.reserves and our properties are in the exploration stage

 

We are currently in the exploration stage and have no proven or probable reserves, as those terms arenot established that our properties contain any mineral reserve according to recognized reserve guidelines, nor can there be any assurance that we will be able to do so. A mineral reserve is defined by the SEC in Regulation SK 1300 as that part of a mineral deposit, which could be economically and legally extracted or produced at the time of the reserve determination. The probability of an individual prospect ever having a “reserve” that meets the requirements of Regulation SK 1300 is extremely remote; in all probability our mineral properties do not contain any “reserves” and any funds that we spend on exploration could be lost. Even if we do eventually discover a mineral reserve on our properties, there can be no assurance that they can be developed into producing mines and extract those minerals. Both mineral exploration and development involve a high degree of risk and few mineral properties which are explored are ultimately developed into producing mines.

The commercial viability of an established mineral deposit will depend on a number of factors including, by way of example, the size, grade and other attributes of the mineral deposit, the proximity of the mineral deposit to infrastructure such as a smelter, roads and a point for shipping, government regulation and market prices. Most of these factors will be beyond our control, and any of our properties including the Langtry Project. The mineralized materialthem could increase costs and make extraction of any identified to date in respect of the Langtry Project has not demonstrated economic viability and we cannot provide any assurance that mineral reserves with economic viability will be identified on that property.deposit unprofitable.

 

In order to demonstrate the existence of proven or probable reserves under SEC guidelines, it would be necessary for us to advance the exploration of our LangtryExcelsior Springs Project by significant additional delineation drilling to demonstrate the existence of sufficient mineralized material with satisfactory continuity which would provide the basis for a feasibility study which would demonstrate with reasonable certainty that the mineralized material can be economically extracted and produced. We do not have sufficient data to support a feasibility study with regard to the LangtryExcelsior Springs Project, and in order to perform the drill work to support such feasibility study, we must obtain the necessary permits and funds to continue our exploration efforts. It is possible that, even after we have obtained sufficient geologic data to support a feasibility study on the LangtryExcelsior Springs Project, such study will conclude that none of the identified mineral deposits can be economically and legally extracted or produced. If we cannot adequately confirm or discover any mineral reserves of precious metals on the LangtryExcelsior Springs Property, we may not be able to generate any revenues. Even if we discover mineral reserves on the LangtryExcelsior Springs Property in the future that can be economically developed, the initial capital costs associated with development and production of any reserves found is such that we might not be profitable for a significant time after the initiation of any development or production. The commercial viability of a mineral deposit once discovered is dependent on a number of factors beyond our control, including particular attributes of the deposit such as size, grade and proximity to infrastructure, as well as metal prices. In addition, development of a project as significant as LangtryExcelsior Springs will likely require significant debt financing, the terms of which could contribute to a delay of profitability.

20

 

The exploration of mineral properties is highly speculative in nature, involves substantial expenditures and is frequently non-productive.

 

Mineral exploration is highly speculative in nature and is frequently non-productive. Substantial expenditures are required to:

 

• establish ore reserves through drilling and metallurgical and other testing techniques;

• determine metal content and metallurgical recovery processes to extract metal from the ore; and,

• design mining and processing facilities.

·establish ore reserves through drilling and metallurgical and other testing techniques;
·determine metal content and metallurgical recovery processes to extract metal from the ore; and,
·design mining and processing facilities.

 

If we discover ore at the LangtryExcelsior Springs Project, we expect that it would be several additional years from the initial phases of exploration until production is possible. During this time, the economic feasibility of production could change. As a result of these uncertainties, there can be no assurance that our exploration programs will result in proven and probable reserves in sufficient quantities to justify commercial operations at the LangtryExcelsior Springs Project.

 

Even if our exploration efforts at LangtryExcelsior Springs are successful, we may not be able to raise the funds necessary to develop the LangtryExcelsior Springs Project.

 

If our exploration efforts at LangtryExcelsior Springs are successful, our current estimates indicate that we would be required to raise at least $50 million in external financing to develop and construct the LangtryExcelsior Springs Project. Sources of external financing could include bank borrowings and debt and equity offerings, but financing has become significantly more difficult to obtain in the current market environment. The failure to obtain financing would have a material adverse effect on our growth strategy and our results of operations and financial condition. There can be no assurance that we will commence production at Langtry or generate sufficient revenues to meet our obligations as they become due or obtain necessary financing on acceptable terms, if at all, and we may not be able to secure the financing necessary to begin or sustain production at the LangtryExcelsior Springs Project. In addition, should we incur significant losses in future periods, we may be unable to continue as a going concern, and we may not be able to realize our assets and settle our liabilities in the normal course of business at amounts reflected in our financial statements included or incorporated by reference in this Form 10-K.

 

We may not be able to obtain all of the permits required for development of the LangtryExcelsior Springs Project.

 

In the ordinary course of business, mining companies are required to seek governmental permits for expansion of existing operations or for the commencement of new operations. We will be required to obtain numerous permits for our LangtryExcelsior Springs Project. Obtaining the necessary governmental permits is a complex and time-consuming process involving numerous jurisdictions and often involving public hearings and costly undertakings.  Our efforts to develop the Property may also be opposed by environmental groups.  In addition, mining projects require the evaluation of environmental impacts for air, water, vegetation, wildlife, cultural, historical, geological, geotechnical, geochemical, soil and socioeconomic conditions. An Environmental Impact Statement would be required before we could commence mine development or mining activities. Baseline environmental conditions are the basis on which direct and indirect impacts of the LangtryExcelsior Springs Project are evaluated and based on which potential mitigation measures would be proposed. If the LangtryExcelsior Springs Project were found to significantly adversely impact the baseline conditions, we could incur significant additional costs to avoid or mitigate the adverse impact, and delays in the LangtryExcelsior Springs Project could result.

 

Permits would also be required for, among other things, storm-water discharge; air quality; wetland disturbance; dam safety (for water storage and/or tailing storage); septic and sewage; and water rights appropriation. In addition, compliance must be demonstrated with the Endangered Species Act and the National Historical Preservation Act.

21

 

The mining industry is intensely competitive.

 

The mining industry is intensely competitive. We may be at a competitive disadvantage because we must compete with other individuals and companies, many of which have greater financial resources, operational experience and technical capabilities than we do. Increased competition could adversely affect our ability to attract necessary capital funding or acquire suitable producing properties or prospects for mineral exploration in the future. We may also encounter increasing competition from other mining companies in our efforts to locate acquisition targets, hire experienced mining professionals and acquire exploration resources.

 

Our future success is subject to risks inherent in the mining industry.

 

Our future mining operations, if any, would be subject to all of the hazards and risks normally incident to developing and operating mining properties. These risks include:

 

• insufficient ore reserves;

• fluctuations in metal prices and increase in production costs that may make mining of reserves uneconomic;

• significant environmental and other regulatory restrictions;

• labor disputes; geological problems;

• failure of underground stopes and/or surface dams;

• force majeure events; and

• the risk of injury to persons, property or the environment.

·insufficient ore reserves;
·fluctuations in metal prices and increase in production costs that may make mining of reserves uneconomic;
·significant environmental and other regulatory restrictions;
·labor disputes; geological problems;
·failure of underground stopes and/or surface dams;
·force majeure events; and
·the risk of injury to persons, property or the environment.

 

Our future profitability will be affected by changes in the prices of metals.

 

If we establish reserves, complete a favorable feasibility study for the LangtryExcelsior Springs Project, and complete development of a mine, our profitability and long-term viability will depend, in large part, on the market price of silver.gold. The market prices for metals are volatile and are affected by numerous factors beyond our control, including:

 

• global or regional consumption patterns;

• supply of, and demand for, silver and other metals;

• speculative activities;

• expectations for inflation; and

• political and economic conditions.

·global or regional consumption patterns;
·supply of, and demand for, silver and other metals;
·speculative activities;
·expectations for inflation; and
·political and economic conditions.

 

The aggregate effect of these factors on metals prices is impossible for us to predict. Decreases in metals prices could adversely affect our ability to finance the exploration and development of our properties, which would have a material adverse effect on our financial condition and results of operations and cash flows. There can be no assurance that metals prices will not decline. As reported on the website www.kitco.com, during the three-year period ended December 31, 2016, the high and low settlement prices for silver were $20.71 and $13.58 per ounce, respectively.

22

 

The market price of silvergold is volatile. Low silvergold prices could result in decreased revenues, decreased net income or increased losses and decreased cash flows, and may negatively affect our business.

 

SilverGold is a commodity. Its price fluctuates, and is affected by many factors beyond our control, including interest rates, expectations regarding inflation, speculation, currency values, governmental decisions regarding the disposal of precious metals stockpiles, global and regional demand and production, political and economic conditions and other factors.

 

The price of silvergold may decline in the future. Factors that are generally understood to contribute to a decline in the price of silvergold include sales by private and government holders, and a general global economic slowdown. If the price of silver is depressed for a sustained period and our net losses continue, we may be forced to suspend operations until the prices increase, and to record asset impairment write-downs. Any continued or increased net losses or asset impairment write-downs would adversely affect our financial condition and results of operationsoperations.

 

We might be unable to raise additional financing necessary to complete capital needs, conduct our business and make payments when due.

 

We will need to raise additional funds in order to meet capital needs and implement our business plan. Any required additional financing might not be available on commercially reasonable terms, or at all. If we raise additional funds by issuing equity securities, holders of our common stock could experience significant dilution of their ownership interest, and these securities could have rights senior to those of the holders of our common stock.

 

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

 

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

 

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

 

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

 

23

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

 

Mineral exploration, particularly for silver,gold, involves many risks and is frequently unproductive. If mineralization is discovered, it may take a number of years until production is possible, during which time the economic viability of the Project may change.

 

Development projects may have no operating history upon which to base estimates of future operating costs and capital requirements. Development project items such as estimates of reserves, metal recoveries and cash operating costs are to a large extent based upon the interpretation of geologic data, obtained from a limited number of drill holes and other sampling techniques, and feasibility studies. Estimates of cash operating costs are then derived based upon anticipated tonnage and grades of ore to be mined and processed, the configuration of the ore body, expected recovery rates of metals from the ore, comparable facility and equipment costs, anticipated climate conditions and other factors. As a result, actual cash operating costs and economic returns of any and all development projects may materially differ from the costs and returns estimated, and accordingly, our financial condition and results of operations may be negatively affected.

 

The estimation of ore reserves is imprecise and depends upon subjective factors. Estimated ore reserves may not be realized in actual production. Our operating results may be negatively affected by inaccurate estimates.

 

If, in the future, we present estimates of ore reserve figures in our public filings, those figures may be estimated by our technical personnel. Reserve estimates are a function of geological and engineering analyses that require us to make assumptions about production costs and silvergold market prices. Reserve estimation is an imprecise and subjective process. The accuracy of such estimates is a function of the quality of available data and of engineering and geological interpretation, judgment and experience. Assumptions about silvergold market prices are subject to great uncertainty as those prices have fluctuated widely in the past. Declines in the market prices of silvergold may render future potential reserves containing relatively lower grades of ore uneconomic to exploit, and we may be required to reduce reserve estimates, discontinue development or mining at one or more of our properties, or write down assets as impaired. Should we encounter mineralization or geologic formations at any of our projects different from those we predicted, we may adjust our reserve estimates and alter our mining plans. Either of these alternatives may adversely affect our actual future production and operating results.

 

The estimation of the ultimate recovery of metals contained within a heap leach pad inventory is inherently inaccurate and subjective and requires the use of estimation techniques. Actual recoveries can be expected to vary from estimations.

 

We expect to use the heap leach process to extract silvergold from ore. The heap leach process is a process of extracting silvergold by placing ore on an impermeable pad and applying a diluted cyanide solution that dissolves a portion of the contained silver, which is then recovered in metallurgical processes.

 

We will use several integrated steps in the process of extracting silvergold to estimate the metal content of ore placed on the leach pads. Although we will refine our estimates as appropriate at each step in the process, the final amounts are not determined until a third-party smelter converts the doré and determines final ounces of silvergold available for sale. We will then review this end result and reconcile it to the estimates we developed and used throughout the production process. Based on this review, we may adjust our estimation procedures when appropriate. As a result, actual recoveries can vary from estimates, and the amount of the variation could be significant and could have a material adverse impact on our financial condition and results of operations.

 

SilverGold mining involves significant production and operational risks. We may suffer from the failure to efficiently operate our mining projects.

 

SilverGold mining involves significant degrees of risk, including those related to mineral exploration success, unexpected geological or mining conditions, the development of new deposits, climatic conditions, equipment and/or service failures, compliance with current or new governmental requirements, current availability of or delays in installing and commissioning plant and equipment, import or customs delays and other general operating risks. Problems may also arise due to the quality or failure of locally obtained equipment or interruptions to services (such as power, water, fuel or transport or processing capacity) or technical support, which results in the failure to achieve expected target dates for exploration or production activities and/or result in a requirement for greater expenditure. The right to develop silvergold reserves may depend on obtaining certain licenses and quotas, the granting of which may be at the discretion of the relevant regulatory authorities. There may be delays in obtaining such licenses and quotas, leading to our results of operations being adversely affected, and it is possible that from time to timetime-to-time mining licenses may be refused.

24

 

There will be significant hazards associated with our mining activities, some of which may not be fully covered by insurance. To the extent we must pay the costs associated with such risks, our business may be negatively affected.

 

The mining business is subject to risks and hazards, including environmental hazards, industrial accidents, the encountering of unusual or unexpected geological formations, cave-ins, flooding, earthquakes and periodic interruptions due to inclement or hazardous weather conditions. These occurrences could result in damage to, or destruction of, mineral properties or production facilities, personal injury or death, environmental damage, reduced production and delays in mining, asset write-downs, monetary losses and possible legal liability. Insurance fully covering many environmental risks (including potential liability for pollution or other hazards as a result of disposal of waste products occurring from exploration and production) is not generally available to us or to other companies in the industry. Although we maintain insurance in an amount that we consider to be adequate, liabilities might exceed policy limits, in which event we could incur significant costs that could adversely affect our financial condition, results of operation and liquidity.

 

We are subject to significant governmental regulations.

 

Our operations and exploration and development activities are subject to extensive federal, state, and local laws and regulations governing various matters, including:

 

• environmental protection;

• management and use of toxic substances and explosives;

• management of natural resources;

• exploration and development of mines, production and post-closure reclamation;

• taxation;

• labor standards and occupational health and safety, including mine safety; and

• historic and cultural preservation.

·environmental protection;
·management and use of toxic substances and explosives;
·management of natural resources;
·exploration and development of mines, production and post-closure reclamation;
·taxation;
·labor standards and occupational health and safety, including mine safety; and
·historic and cultural preservation.

 

Failure to comply with applicable laws and regulations may result in civil or criminal fines or penalties or enforcement actions, including orders issued by regulatory or judicial authorities enjoining or curtailing operations or requiring corrective measures, installation of additional equipment or remedial actions, any of which could result in us incurring significant expenditures. We may also be required to compensate private parties suffering loss or damage by reason of a breach of such laws, regulations or permitting requirements. It is also possible that future laws and regulations, or a more stringent enforcement of current laws and regulations by governmental authorities, could cause additional expense, capital expenditures, restrictions on or suspensions of any future operations and delays in the exploration of our properties.

 

Changes in mining or environmental laws could increase costs and impair our ability to develop our properties.

 

From time to time the U.S. Congress may consider revisions in its mining and environmental laws. It remains unclear to what extent new legislation may affect existing mining claims. The effect of any such revisions on our operations cannot be determined conclusively until such revision is enacted; however, such legislation could materially increase costs on properties located on federal lands, such as ours, and such revision could also impair our ability to develop the Langtry Project and to explore and develop other mineral projects.

25

 

Compliance with environmental regulations and litigation based on environmental regulations could require significant expenditures.

 

Mining exploration and mining are subject to the potential risks and liabilities associated with pollution of the environment and the disposal of waste products occurring as a result of mineral exploration and production. Insurance against environmental risk (including potential liability for pollution or other hazards as a result of the disposal of waste products occurring from exploration and production) is not generally available to us (or to other companies in the minerals industry) at a reasonable price.

 

Environmental regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects, and a heightened degree of responsibility for companies and their officers, directors and employees.

 

To the extent we are subject to environmental liabilities, the settlement of such liabilities or the costs that we may incur to remedy environmental pollution would reduce funds otherwise available to us and could have a material adverse effect on our financial condition and results of operations. If we are unable to fully remedy an environmental problem, it might be required to suspend operations or enter into interim compliance measures pending completion of the required remedy. The environmental standards that may ultimately be imposed at a mine site impact the cost of remediation and may exceed the financial accruals that have been made for such remediation. The potential exposure may be significant and could have a material adverse effect on our financial condition and results of operations.

 

Moreover, governmental authorities and private parties may bring lawsuits based upon damage to property and injury to persons resulting from the environmental, health and safety impacts of our operations, which could lead to the imposition of substantial fines, remediation costs, penalties and other civil and criminal sanctions. Substantial costs and liabilities, including for restoring the environment after the closure of mines, are inherent in our proposed operationsoperations.

 

Some mining wastes are currently exempt to a limited extent from the extensive set of federal Environmental Protection Agency (“EPA”) regulations governing hazardous waste under the Resource Conservation and Recovery Act (“RCRA”). If the EPA designates these wastes as hazardous under RCRA, we may be required to expend additional amounts on the handling of such wastes and to make significant expenditures to construct hazardous waste disposal facilities. In addition, if any of these wastes causes contamination in or damage to the environment at a mining facility, such facility may be designated as a “Superfund” site under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”). Under CERCLA, any owner or operator of a Superfund site since the time of its contamination may be held liable and may be forced to undertake extensive remedial cleanup action or to pay for the government’s cleanup efforts. Such owner or operator may also be liable to governmental entities for the cost of damages to natural resources, which may be substantial. Additional regulations or requirements are also imposed under the federal Clean Water Act (“CWA”). The Company considers the current proposed federal legislation relating to climate change and its potential enactment may have future impacts to the Company’s operations in the United States.

 

In addition, there are numerous legislative and regulatory proposals related to climate change, including legislation pending in the U.S. Congress to require reductions in greenhouse gas emissions. The Company has reviewed and considered current federal legislation relating to climate change and does not believe it to have a material effect on its operations, however, additional regulation or requirements under any of these laws and regulations could have a materially adverse effect upon the Company and its results of operations.

 

26

Compliance with CERCLA, the CWA and state environmental laws could entail significant costs, which could have a material adverse effect on our operations.

 

In the context of environmental permits, including the approval of reclamation plans, we must comply with standards and regulations which entail significant costs and can entail significant delays. Such costs and delays could have a dramatic impact on our operations. There is no assurance that future changes in environmental regulation, if any, will not adversely affect our operations. We intend to fully comply with all applicable environmental regulations.

 

We are required to obtain government permits to begin new operations. The acquisition of such permits can be materially impacted by third party litigation seeking to prevent the issuance of such permits. The costs and delays associated with such approvals could affect our operations, reduce our revenues, and negatively affect our business as a whole.

 

Mining companies are required to seek governmental permits for the commencement of new operations. Obtaining the necessary governmental permits is a complex and time-consuming process involving numerous jurisdictions and often involving public hearings and costly undertakings. The duration and success of permitting efforts are contingent on many factors that are out of our control. The governmental approval process may increase costs and cause delays depending on the nature of the activity to be permitted, and could cause us to not proceed with the development of a mine. Accordingly, this approval process could harm our results of operations.

 

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

 

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

 

We are continuously considering possible acquisitions of additional mining properties or interests therein that are located in other countries, and could be exposed to significant risks associated with any such acquisitions.

 

In the ordinary course of our business, we are continuously considering the possible acquisition of additional significant mining properties or interests therein that may be located in countries other than those in which we now have interests. Consequently, in addition to the risks inherent in the valuation and acquisition of such mining properties, as well as the subsequent development, operation or ownership thereof, we could be subject to additional risks in such countries as a result of governmental policies, economic instability, currency value fluctuations and other risks associated with the development, operation or ownership of mining properties or interests therein. Such risks could adversely affect our results of operations.

 

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

 

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

27

 

Current economic conditions and in the global economy generally, including ongoing disruptions in the debt and equity capital markets, may adversely affect our business and results of operations, and our ability to obtain financing.

 

The global economy has undergoing a slowdown, which some observers view as a deepening recession, and the future economic environment may continue to be less favorable than that of recent years. The mining industry has experienced and may continue to experience significant downturns in connection with, or in anticipation of, declines in general economic conditions. We are unable to predict the likely duration and severity of the current disruptions in debt and equity capital markets and adverse economic conditions in the United States and other countries, which may continue to have an adverse effect on our business and results of operations.

 

The global stock and credit markets have recently experienced significant price volatility, dislocations and liquidity disruptions, which have caused market prices of many stocks to fluctuate substantially and the spreads on prospective and outstanding debt financings to widen considerably. These circumstances have materially impacted liquidity in the financial markets, making terms for certain financings materially less attractive, and in certain cases have resulted in the unavailability of certain types of financing. This volatility and illiquidity hashave negatively affected a broad range of mortgage and asset-backed and other fixed income securities. As a result, the market for fixed income securities has experienced decreased liquidity, increased price volatility, credit downgrade events, and increased defaults. Global equity markets have also been experiencing heightened volatility and turmoil, with issuers exposed to the credit markets particularly affected. These factors and the continuing market disruption have an adverse effect on us, in part because we, like many companies, from time to time may need to raise capital in debt and equity capital markets including in the asset-backed securities markets.

 

In addition, continued uncertainty in the stock and credit markets may negatively affect our ability to access additional short-term and long-term financing, including future securitization transactions, on reasonable terms or at all, which would negatively impact our liquidity and financial condition. In addition, if one or more of the financial institutions that support our future credit facilities fails, we may not be able to find a replacement, which would negatively impact our ability to borrow under the credit facilities. These disruptions in the financial markets also may adversely affect our credit rating and the market value of our common stock. If the current pressures on credit continue or worsen, we may not be able to refinance, if necessary, our outstanding debt when due, which could have a material adverse effect on our business. While we believe we will have adequate sources of liquidity to meet our anticipated requirements for working capital, debt servicing and capital expenditures for the foreseeable future if our operating results worsen significantly and our cash flow or capital resources prove inadequate, or if interest rates increase significantly, we could face liquidity problems that could materially and adversely affect our results of operations and financial condition.

 

As we do not maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential shareholders could lose confidence in our financial reporting. This would harm our business and the trading price of our stock.

 

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. If we cannot provide financial reports or prevent fraud, our business reputation and operating results could be harmed. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

 

Risks Related to Our Stock

Future issuances of our common stock could dilute current shareholders and adversely affect the market if it develops.

 

We have the authority to issue up to 100250 million shares of common stock and 5 million shares of preferred stock and to issue options and warrants to purchase shares of our common stock, without shareholder approval. Future share issuances are likely due to our need to raise additional working capital in the future. Those future issuances will likely result in dilution to our shareholders. In addition, we could issue large blocks of our common stock to fend off unwanted tender offers or hostile takeovers without further shareholder approval, which would not only result in further dilution to investors in this offering but could also depress the market value of our common stock, if a public trading market develops.

28

 

We may issue preferred stock that would have rights that are preferential to the rights of our common stock that could discourage potentially beneficial transactions to our common shareholders.

 

An issuance of shares of preferred stock could result in a class of outstanding securities that would have preferences with respect to voting rights and dividends and in liquidation over our common stock and could, upon conversion or otherwise, have all of the rights of our common stock. Our Board of Directors' authority to issue preferred stock could discourage potential takeover attempts or could delay or prevent a change in control through merger, tender offer, proxy contest or otherwise by making these attempts more difficult or costly to achieve. The issuance of preferred stock could impair the voting, dividend and liquidation rights of common stockholders without their approval.

 

Outstanding shares that are eligible for future sale could adversely impact a public trading market for our common stock if a public trading market develops.

 

In the future, we may offer and sell shares without registration under the Securities Act. All of such shares will be "restricted securities" as defined by Rule 144 ("Rule 144") under the Securities Act and cannot be resold without registration except in reliance on Rule 144 or another applicable exemption from registration. Under Rule 144, our non-affiliates can sell restricted shares held for at least six months, subject only to the restriction that we made available public information as required by Rule 144. Our affiliates can sell restricted securities after six months, subject to compliance with the volume limitation, manner of sale, Form 144 filing and current public information requirements.

 

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

 

If a public trading market for our shares develops, ownersOwners of our common stock will be subject to the “penny stock” rules.

Since our shares are not listed on a national stock exchange or quoted on the Nasdaq Capital Market within the United States, if a public trading market develops, of which there can be no assurance, trading in our shares on the OTC market will be subject, to the extent the market price for our shares is less than $5.00 per share, to a number of regulations known as the "penny stock rules".  The penny stock rules require a broker-dealer to deliver a standardized risk disclosure document prepared by the SEC, to provide the customer with additional information including current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, monthly account statements showing the market value of each penny stock held in the customer's account, and to make a special written determination that the penny stock is a suitable investment for the investor and receive the investor’s written agreement to the transaction.  To the extent these requirements may be applicable they will reduce the level of trading activity in the secondary market for our shares and may severely and adversely affect the ability of broker-dealers to sell our shares, if a publicly traded market develops.shares.

 

We do not expect to pay cash dividends in the foreseeable future. Any return on investment may be limited to the value of our stock.

 

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

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

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

 

29

ITEM 1B.1B – UNRESOLVED STAFF COMMENTS.

 

None.

 

ITEM 2. PROPERTIES2 – PROPERTIES.

 

Descriptions of our mining and other properties are contained in the Business discussion in this Report.

 

ITEM 3.3 – LEGAL PROCEEDINGSPROCEEDINGS.

 

None.

 


1The U.S. Geological Survey (1997) defined two main aquifer systems in the area of the Nebo and Yermo Annexes. The Mojave River aquifer is contained within the sand and gravel of the Mojave River alluvium, and the regional aquifer lies in the bordering alluvial-fan deposits and older alluvium.ITEM 4 – REMOVED AND RESERVED.


 

 

ITEM 4. REMOVED AND RESERVED

30

PART II

 

ITEM 5.5 – MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATEDSTOCKHOLDER MATTERSRELATED STOCKHOLDER MATTERS.

 

Market Information

 

Our outstanding shares of common stock traded over-the-counter and quoted on the OTC Bulletin Board (“OTCBB”) under the symbol “GWBC” from January 1, 2007 to February 5, 2010. Effective February 5, 2010, our outstanding shares of common stock have traded over-the-counter and quoted on the OTCBB under the symbol “AHNR”. OurThe Company’s common stock is quoted currentlyfor trading on the OTC.QB of the OTC Markets Group, Inc.OTCQB under the symbol “AHNR.” The reported high“AHNR” and low prices for our common stock are shown below foris traded on the period from January 1, 2015 through December 31, 2016. All quoted pricesCanadian Securities Exchange (or CSE) under the symbol “ATHA”. Over-the-counter market quotations on the OTCQB reflect inter-dealer prices, without retail markup,mark-up, mark-down or commission and may not necessarily represent actual transactions.

 

 

2016

 

2015

 

 

 

High

 

 

Low

 

 

High

 

 

Low

 

First quarter ended March 31

$

$ 0.12

 

$

$ 0.02

 

$

0.15

 

$

0.04

 

Second quarter ended June 30

$

$ 0.12

 

$

$ 0.05

 

$

0.07

 

$

0.07

 

Third quarter ended September 30

$

$ 0.15

 

$

$ 0.07

 

$

0.07

 

$

0.03

 

Fourth quarter ended December 31

$

$ 0.10

 

$

$ 0.05

 

$

0.04

 

$

0.02

 

Registered HoldersOn December 31, 2022, there were 136,091,400 Common Shares issued and outstanding, and the Company had approximately 92 shareholders of our Common Stockrecord. On December 30, 2022, the closing price of the shares of common stock as reported by the CSE was C$0.10 and on OTCQB was $0.06.

  

As of March 8, 2017, there were approximately 55 record owners of our common stock. We believe that a number of stockholders hold stock on deposit with their brokers or investment bankers registered in the name of stock depositories.

Dividends

 

Our Board of Directors may declare and pay dividends on outstanding shares of common stock out of funds legally available therefore in its sole discretion; however, to date, no dividends have been paid on common stock and we do not anticipate the payment of dividends in the foreseeable future.

 

Trading in our common stock is subject to rules adopted by the SEC regulating broker dealer practices in connection with transactions in "penny stocks." Those disclosure rules applicable to penny stocks require a broker dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the SEC. That disclosure document advises an investor that investment in penny stocks can be very risky and that the investor's salesperson or broker is not an impartial advisor but rather paid to sell the shares. The disclosure contains further warnings for the investor to exercise caution in connection with an investment in penny stocks, to independently investigate the security, as well as the salesperson with whom the investor is working and to understand the risky nature of an investment in this security. The broker dealer must also provide the customer with certain other information and must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. Further, the rules require that, following the proposed transaction, the broker provide the customer with monthly account statements containing market information about the prices of the securities.

 

Recent Sales of Unregistered Securities

 

None.None, except as reported on Forms 8-K.

 

Equity Compensation Plan Information

 

The Company has no equity compensation plans.adopted its 2020 Equity Incentive Plan which became effective in January 2021. Under the Plan, the Company is authorized to issue up to 10 million shares of common stock pursuant to grants and the exercise of rights under the Plan. As of the date of this Report, there have been 4,980,000 option grants under the Plan.

 

ITEM 6.6 – SELECTED FINANCIAL DATADATA.

 

We are a smaller reporting company as defined by the Exchange Act and are not required to provide the information required under this item.

 

 


 

31

ITEM 7.7 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSOPERATIONS.

 

We use the terms “Athena,” “we,” “our,” and “us” to refer to Athena SilverGold Corporation and its consolidated subsidiary.subsidiary, Athena Minerals, Inc (“AMI”).

 

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this Report. The discussion of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future.

 

Forward-Looking Statements

 

Some of the information presented in this Form 10-K constitutes “forward-looking statements. These forward-looking statements include, but are not limited to, statements that include terms such as “may,” “will,” “intend,” “anticipate,” “estimate,” “expect,” “continue,” “believe,” “plan,” or the like, as well as all statements that are not historical facts. Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from current expectations. Although we believe our expectations are based on reasonable assumptions within the bounds of our knowledge of our business and operations, there can be no assurance that actual results will not differ materially from expectations.

 

All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

 

Business Overview

We were incorporated on December 23, 2003, in Delaware and our principal business is the acquisition and exploration of mineral resources.

On March 15, 2010, we entered into a Mining Lease with Option to Purchase (the “Langtry Lease” or the “Lease”) which granted us a 20 year lease to develop and conduct mining operations on a 413 acre group of 20 patented mining claims located in the Calico Mining District (the “Langtry Property”, or the “Property”), also with an option to purchase the Property. This Property is located at the base of the Calico Mountains northeast of Barstow, in San Bernardino County, California. We also entered into amendments #1, #2 and #3 to the lease.

In March 2016, we entered into a new lease/option agreement that replaced the prior mining lease and its amendments #1, #2 and #3. In addition to the patented claims controlled through this mining lease, the Company has staked and acquired unpatented mining claims that together represent the Langtry project.

During the first quarter of 2011, we completed a 13-hole drilling program on our Langtry Property in an effort to validate the results of an earlier drilling program undertaken by a previous owner of the Property during the 1960’s and 1970’s and to further define silver deposits near historic workings on the Property. During the remainder of 2011 and during the first quarter of 2012, we evaluated the results of our drilling program, performed metallurgical studies and hired an independent firm to estimate our resources. In May 2012, our independent consultant issued a N I 43-101 report following the guidelines specified by the Canadian Council of Professional Geoscientists and included a description of the Langtry Property and location, history, geological setting, deposit types, mineralization, exploration, drilling, sampling method and approach, sample preparation, analyses and security, data verification, mineral resource and mineral reserve estimates, as well as other relevant data and information. Since the completion of these work programs on the property, we have not had the resources to do further field work and have focused on other ways to maximize value through the renegotiation of our lease obligation into a more favorable lease/option agreement, renegotiating the net smelter royalty on the Langtry patented claims, acquiring additional mining claims adjacent to the Langtry patented claims and working with San Bernardino County to confirm our vested mining right for the Langtry patented claims held under the lease/option agreement.

We continue to evaluate strategies to enhance the value of our mining assets subject to restrictions based on our limited capital available under our line of credit. Our ongoing mineral lease payments, exploration and development efforts and general and administrative expenses will require additional capital.

Results of Operations:

Our analysis presented below is organized to provide the information we believe will be instructive for understanding our historical performance and relevant trends going forward. This discussion should be read in conjunction with our consolidated financial statements, including the notes thereto, included in this Annual Report on Form 10-K.

 

Results of Operations for the Years Ended December 31, 20162022 and 20152021

 

A summary of our results from operations is as follows:

 

 

 

 

 

 

Years Ended December 31,

 

 

 

 

 

2016

 

2015

Operating expenses:

 

 

 

 

Exploration costs

$9,489  

 

$93,661  

 

General and administrative expenses

132,900  

 

133,299  

 

 

Total operating expenses

142,389  

 

226,960  

Operating loss

(142,389) 

 

(226,960) 

 

 

Total other expenses, net

(139,622) 

 

(72,499) 

Net loss

 

 

$(282,011) 

 

$(299,459) 

  Twelve Months Ended 
   12/31/22   12/31/21 
         
Operating expenses        
Exploration, evaluation and project expenses $617,262  $137,983 
General and administrative expenses  682,512   614,478 
Total operating expenses  1,299,774   752,461 
         
Net operating loss  (1,299,774)  (752,461)
         
Interest expense  (463)  (12,192)
Gain on extinguishment of debt  0   3,880 
Revaluation of warrant liability  616,579   (269,482)
Net loss $(683,658) $(1,030,255)

 

During the year ended December 31, 2016, our net loss was $282,011 as compared to a net loss of $299,459 during the year ended December 31, 2015. The $17,448 decrease in our loss was mainly attributable to decreased exploration costs during the year ended December 31, 2016 as compared to the year ended December 31, 2015 and certain non-cash items due to changes in the values of our derivative liabilities associated with a convertible note payable and outstanding warrants.

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Operating expenses:

 

DuringFor the year endedtwelve months ending December 31, 2016, our total operating expenses decreased $84,571, or 37%, from $226,960 to $142,389 for2022, the years ended December 31, 2015 and 2016, respectively.

During the year ended December 31, 2016, we incurred $9,489 of exploration costs primarily consisting of title research and survey expenses associated with the land acquired and other acquisition targets, as compared to $93,661 during 2015. For the year ended December 31, 2015 exploration costs primarily consisted of legal expenses associated with the preparation and filing of a certificate of compliance with San Bernardino County regarding the Langtry patented claims held under lease and consulting fees paid to our consulting geologist for analysis of other potential mineral opportunities.

OurCompany increased general and administrative expenses decreased $399, from $133,299by approximately $69,000. The increase was due to $132,900 for the years ended December 31, 2015 and 2016, respectively. The decrease is primarily attributable to small increases in professional services fees and small decreases in office expenses and licenses and permits associated with our mining activities.following year over year variances:

 

Other income and expense:

Twelve months ending 12/31/2022  12/31/2021  Variance 
Legal and other professional fees $318,000  $370,000  $(52,000)
Share based compensation  231,000   158,000   73,000 
Stock exchange fees and related expenses  115,000   68,000   47,000 
Other general expenses  19,000   18,000   1,000 
Total $683,000  $614,000  $69,000 

 

Our total other expenses were $139,622 during the year ended December 31, 2016, as compared to total other expenses of $72,499 during the year ended December 31, 2015.
·The decrease in legal and professional fees increase is associated with the acquisition and maintenance of the Excelsior Springs project and our listing on the Canadian Stock Exchange (“CSE”) in 2021.
·

The increase in share-based compensation is due to the following:

On March 22, 2021, the Company issued a total of 2,000,000 non-statutory stock options to four individuals, three of which are Directors of the Company, the other an independent technical consultant. Upon vesting, each option is exercisable to purchase one share of common stock at a price of $0.09 per share. The options vest 50% upon issuance, and 25% on each of the first and second anniversaries of the grant date. The Company recognized share-based compensation expense related to the stock options of $128,000 for 2021. In addition, the Company agreed to issue a total of 300,000 restricted stock units at a price of $0.10 per share to the independent technical consultant helping design our 2021 exploration programs at Excelsior Springs. As such, we have recorded stock-based compensation in the amount of $30,000, with a share-based compensation of $47,548 in 2022 and

On October 12, 2022, the Company granted 2,250,000 options pursuant to the terms of the Company’s Stock Option Plan. The Black Scholes option pricing model was used to estimate the aggregate fair value of the October 2022 options of $106,109 as stock-based compensation.  In addition, 675,000 shares were issued to officers and directors with a fair value of $33,750.  On August 24, 2022, the Company granted 730,000 options pursuant to the terms of the Company’s Stock Option Plan. The Black Scholes option pricing model was used to estimate the aggregate fair value of the August 2022 options of $43,456 as stock-based compensation.
·The increase in stock exchange fees was a result of listing on the CSE and other compliance reporting.

 

For the year ended December 31, 2016 we incurred2022, there was a totalvariance of $85,182approximately $479,000 for the same period in interest expense, of2021 in exploration and evaluation expenses. The Company engaged in activities on our exploration programs, including drilling, mapping, permitting, consulting and assay testing which $81,184 was associated with our related party convertible credit facility, as well as $3,226 of interest expense associated with a convertible note payable originatinghas resulted in April 2015, from the conversion of certain amounts due our primary legal counsel. In addition, on September 12, 2016 we executed an installment note payable with Mr. John Power, the Company’s President and Chief Executive Officer in the amount of $45,000. For the year ended December 31, 2016 a total of $772 of interest expense was attributableadditional exploration cost compared to this note payable.2021. 

  

For the year ended December 31, 2015 we incurred a total of $102,859 of interest expense, of which $68,806 was associated with our related party convertible notes payable. In addition, on April 1, 2015 we agreed to convert certain amounts due our primary legal counsel to a convertible note payable in the face amount of $51,270, for which $2,343 of interest expense was charged for the year ended December 31, 2015. Certain features of the convertible note payable resulted in an initial discount to the note of $31,710, which was charged to interest expense upon its inception during the second quarter.

 

The resulting liability represents a derivative liability that is evaluated at the end of each reporting period. At December 31, 2016 our evaluation of the derivative liability resulted in a $53,840 increase of the liability that was recorded as a loss as a change in value of the derivative liability on the accompanying consolidated statement of operations for the year ended December 31, 2016. For the year ended December 31, 2015 our evaluation of this derivative liability resulted in a $23,570 decrease of the liability that was recorded as a gain representing a change in value of the derivative liability on the accompanying consolidated statement of operations for the year ended December 31, 2015.

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Our evaluationOther income and mark-to-marketexpense:

The revaluation of our derivative liability associated with outstanding common stock purchase warrants at December 31, 2016 resulted in a $600 increase in the liability as compared to a $6,790 decrease in thewarrant liability for the year endedtwelve months ending December 31, 2015.2022, is based on the following warrants that were issued as part of the private placements as detailed in Note 4 to the financial statements.

Warrant date 12/31/2022  2022 initial valuation  12/31/2021  (Gain) loss on revaluation 
October 2022 $21,266  $18,630  $0  $(2,636)
September 2022  115,000   100,656   0   (14,344)
August 31, 2022  95,351   139,255   0   43,904 
August 12, 2022  134,067   129,812   0   (4,255)
April 2022  293,698   203,838   0   (89,860)
September 2021  115,122   0   341,145   226,023 
May 2021  225,316   0   683,063   457,747 
Total $999,820  $592,191  $1,024,208  $616,579 

 

Liquidity and Capital Resources:

 

The Company has no revenue generating operations from which it can internally generate funds. To date, the Company’s ongoing operations have been financed by the sale of its equity securities by way of public offerings, private placements and the exercise of incentive stock options and share purchase warrants. The Company believes that it will be able to secure additional private placements and public financings in the future, although it cannot predict the size or pricing of any such financings. This situation is unlikely to change until such time as the Company can develop a bankable feasibility study on one of its projects.

During August, September and October 2022, the Company completed the private placement of four tranches (August 12, 2022; August 31, 2022; September 14, 2022; October 28, 2022) in which we sold 8,807,700 units. We realized total proceeds of $529,908 net of offering costs.

In April 2022 the Company completed a private placement in which we sold 6,250,000 units. We realized total proceeds of $394,082 net of offering costs.

On May 25, 2021 we completed a private placement in which we sold 6,250,000 units. We realized total proceeds of $401,823 net of offering costs. Additionally, on September 30, 2021 we completed a private placement in which we sold 3,108,700 units. We realized total proceeds of $190,552 net of offering costs.

Going Concern

Our consolidated financial statements have been prepared on a going concern basis, which assumes that we will be able to meet our obligations and continue our operations during the next fiscal year. Asset realization values may be significantly different from carrying values as shown in our consolidated financial statements and do not give effect to adjustments that would be necessary to the carrying values of assets and liabilities should we be unable to continue as a going concern.

 

At December 31, 2016, we had not yet achieved profitable operations and we have accumulated losses of $6,851,898 since our inception. We expect to incur further losses in the development of our business, all of which raises substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate future profits and/or to obtain the necessary financing to meet our obligations arising from normal business operations when they come due. On October 13, 2016 we amended our credit agreement with Mr. John Gibbs, a related party, to increase the borrowing limit under the line of credit to $1,750,000 and extend the maturity date to December 31, 2017.

 

In addition, on September 12, 2016 we executed an installment note payable with Mr. John Power, the Company’s President and Chief Executive Officer in the amount of $45,000. The Note accrues interest at 6% per year, and matures on September 12, 2018. The Note requires monthly principal and interest payments of $1,994 beginning on October 12, 2016.

34

 

We have financed our capital requirements primarily through borrowings from related parties. We expect to meet our future financing needs and working capital and capital expenditure requirements through additional borrowings and offerings of debt or equity securities, although there can be no assurance that our future financing efforts will be successful. The terms of future financing could be highly dilutive to existing shareholders. Currently, there are no arrangements in place for additional equity funding or new loans.

 

Liquidity

 

As of December 31, 2016,2022, we had $1,582approximately $15,000 of cash and cash equivalents anda negative working capital of $2,195,038.approximately $215,000. This compares to cash on hand of $1,055approximately $73,000 and negative working capital of $1,819,581approximately $74,000 at December 31, 2015.

We have a Credit Agreement, as amended, with a significant shareholder, which provides us with an unsecured credit facility in the maximum borrowing amount of $1,750,000. The aggregate principal amount borrowed, together with interest at the rate of 5% per annum, is due in full on December 31, 2017, and is convertible, at the option of the lender, into common shares at a conversion price of $0.50 per share.2021.

 

The credit facility also contains customary representationsCompany expects that it will operate at a loss for the foreseeable future and warranties (including those relatingbelieves the current cash and cash equivalents and working capital will be sufficient for it to organizationmaintain its currently held properties, fund its planned exploration, and authorization, compliance with laws, paymentfund its currently anticipated general and administrative costs for at least the next 12 months from the date of taxesthis report.

However, the Company does expect that it will be required to raise additional funds through public or private equity financings in the future in order to continue in business in the future past the immediate 12-month period. Should such financing not be available in that timeframe, the Company will be required to reduce its activities and other obligations, absencewill not be able to carry out all of defaults, material agreementsits presently planned exploration and, litigation)if warranted, development activities on its currently anticipated scheduling.

Capital Management

The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to pursue the development and customary eventsexploration of default (including those relatingits mineral properties and to monetary defaults, covenant defaults, cross defaults and bankruptcy events). maintain a flexible capital structure, which optimizes the costs of capital to an acceptable risk.

As of December 31, 2016 total borrowings under2022, the Credit Agreement were $1,715,620, leaving $34,380capital structure of credit available for future borrowings.

the Company consists of 136,091,400 shares of common stock, par value $0.0001. The Langtry leaseCompany manages the capital structure and optionadjusts it in response to purchase originatedchanges in March 2010,economic conditions, its expected funding requirements, and had beenrisk characteristics of the underlying assets. The Company’s funding requirements are based on cash forecasts. In order to maintain or adjust the capital structure, the Company may issue new debt, new shares and/or consider strategic alliances. Management reviews its capital management approach on a regular basis. The Company is not subject to various amendments. A new Lease/Purchase Option dated March 10, 2016, which modified the rental, option payments and lessor royalties covering the Langtry Property, replaced the lease and subsequent amendments thereto in its entirety. Details of the terms of the new Lease/Purchase Option are contained in Note 3 of the financial statements in this annual report on Form 10-K.

Cash Flows

A summary of our cash provided by and used in operating, investing and financing activities is as follows:

 

 

 

 

 

Years Ended December 31,

 

 

 

 

 

2016

 

2015

Net cash used in operating activities

$(123,645) 

 

$(210,462) 

Net cash used in investing activities

(121,113) 

 

(50,605) 

Net cash provided by financing activities

245,285  

 

254,000  

Net increase (decrease) in cash

527  

 

(7,067) 

Cash and cash equivalents, beginning of period

1,055  

 

8,122  

Cash and cash equivalents, end of period

$1,582  

 

$1,055  

Net cash used in operating activities:

Net cash used in operating activities was $123,645 and $210,462 during the years ended December 31, 2016 and 2015, respectively.

Cash used in operating activities during the year ended December 31, 2016 is primarily attributed to our $(282,011) net loss adjusted for non-cash losses of $54,440 resulting from changes in the valuations of our derivative liabilities. In addition, we realized a decrease in operating accounts payable of $6,107, and increases in accrued interest on our related party notes of $81,307, and other accrued liabilities of $28,726.

Cash used in operating activities during the year ended December 31, 2015 mainly related to our $(299,459) net loss as adjusted for the non-cash amortization of the debt discount resulting from the conversion of certain accounts payable due our primary legal counsel into a convertible note payable, a net decrease in the fair value of our derivative liabilities of $30,360, and changes in operating assets and liabilities. Current operating liabilities were comprised of a net $87,647 increase in current liabilities applicable to operations consisting of accounts payable and accrued liabilities primarily representing accrued interest on our related party convertible notes payable.

Net cash used in investing activities:

Cash used in investing activities was $121,113 during the year ended December 31, 2016 as compared to $50,605 during the year ended December 31, 2015.

Cash used in investing activities during the year ended December 31, 2016 totaled $121,113. We made payments totaling $40,000 that were accrued under the prior Langtry lease agreements, as well as payments due under the 2016 Lease/Purchase Option due of $40,000, and $20 representing the 20-year lease payment at $1 per year. In addition, we paid $6,000 due on our purchase of 15 unpatented mining claims in the Calico Mining District in San Bernardino, California from a third party. The claims are contiguous to our existing unpatented and patented claims known as the Langtry Property. In addition, we paid $6,510 to the Bureau of Land Management to maintain the good standing of our unpatented claims. Finally, on August 8, 2016, we purchased 33+/- acres of land (“Section 16 Property”) for $28,582, net of $18 of title fees, located in San Bernardino County, California.

Cash used in investing activities during the year ended December 31, 2015 primarily represents our annual lease rental payments under our Langtry Lease of $30,000. In addition, on May 28, 2015 we successfully negotiated an amendment to the deed underlying the Langtry Lease to cap at 2% the net smelter royalty that would be due to Mobil Exploration and Producing North America Inc. (“Mobil”) from any future sales of concentrates, precipitates or metals produced from ores mined from the royalty acreage. In consideration for the amendment, we agreed to pay an amendment fee of $150,000, with $10,000 due at the time of the agreement and the balance payable $10,000 each June 1st until paid in full. If we sell our interest in the Lease or enter into an agreement, joint venture or other agreement for the exploration and development of the Langtry Property, the amendment fee shall become due and payable immediately. The initial payment of $10,000 was capitalized as mineral rights associated with the Langtry Lease.

Net cash provided by financing activities:

Cash provided by financing activities during the year ended December 31, 2016 was $245,285 compared to cash provided by financing activities of $254,000 for the year ended December 31, 2015.

During the year ended December 31, 2016 we borrowed $260,620 representing borrowings under our credit agreement. In addition, on September 12, 2016 we executed an installment note payable with the Company’s President and Chief Executive Officer in the amount of $45,000 and subsequently paid a total of $5,335 in regularly scheduled monthly principal payments. Also, during the year ended December 31, 2016 the Company’s President advanced a total of $7,250, all of which was repaid during the year. In addition, we made the scheduled $10,000 payment due June 1st on our deed amendment liability.

Cash provided by financing activities during the year ended December 31, 2015 was $254,000 representing borrowings under our credit agreement. Also, during the year ended December 31, 2015 the Company’s President advanced a total of $6,710, all of which was repaid during the year.externally imposed capital requirements.

 

Off Balance Sheet Arrangements:Arrangements

 

We do not have and never hadengage in any activities involving variable interest entities or off-balance sheet arrangements.

 

Recent Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Critical Accounting Policies and Use of Estimates

 

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions and judgments that affect the amounts reported in our financial statements.  The accounting positions described below are significantly affected by critical accounting estimates.

 

We believe that the significant estimates, assumptions and judgments used when accounting for items and matters such as capitalized mineral rights, asset valuations, recoverability of assets, asset impairments, taxes, and other provisions were reasonable, based upon information available at the time they were made. Actual results could differ from these estimates, making it possible that a change in these estimates could occur in the near term.

 

Mineral Rights

We have determined that our mining rights meet the definition of mineral rights, as defined by accounting standards, and are tangible assets. As a result, our direct costs to acquire or lease mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with: leasing or acquiring patented and unpatented mining claims; leasing mining rights including lease signature bonuses, lease rental payments and advance minimum royalty payments; and options to purchase or lease mineral properties.

If we establish proven and probable reserves for a mineral property and establish that the mineral property can be economically developed, mineral rights will be amortized over the estimated useful life of the property following the commencement of commercial production or expensed if it is determined that the mineral property has no future economic value or if the property is sold or abandoned. For mineral rights in which proven and probable reserves have not yet been established, we assess the carrying values for impairment at the end of each reporting period and whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

The net carrying value of our mineral rights represents the fair value at the time the mineral rights were acquired less accumulated depletion and any impairment losses. Proven and probable reserves have not been established for mineral rights as of December 31, 2016. No impairment loss was recognized during either the years ended December 31, 2016 and 2015, and mineral rights are net of $0 of impairment losses as of December 31, 2016.

Impairment of Long-lived Assets

We continually monitor events and changes in circumstances that could indicate that our carrying amounts of long-lived assets, including mineral rights, may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through their undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of these assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets.

Exploration Costs

Mineral exploration costs are expensed as incurred. When it has been determined that it is economically feasible to extract minerals and the permitting process has been initiated, exploration costs incurred to further delineate and develop the property are considered pre-commercial production costs and will be capitalized and included as mine development costs in our consolidated balance sheets.

Share-based Payments

We measure and recognize compensation expense or professional services expense for all share-based payment awards made to employees, directors and non-employee consultants based on estimated fair values. We estimate the fair value of stock options on the date of grant using the Black-Scholes-Merton option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the options. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected life of the options.

We expense share-based compensation, adjusted for estimated forfeitures, using the straight-line method over the vesting term of the award for our employees and directors and over the expected service term for our non-employee consultants. We estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from our estimates. Our excess tax benefits, if any, cannot be credited to stockholders’ equity until the deduction reduces cash taxes payable; accordingly, we realized no excess tax benefits during any of the periods presented in the accompanying consolidated financial statements.

Income Taxes

We account for income taxes through the use of the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and for income tax carry-forwards. A valuation allowance is recorded to the extent that we cannot conclude that realization of deferred tax assets is more likely than not. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.

We follow a two-step approach to recognizing and measuring tax benefits associated with uncertain tax positions taken, or expected to be taken in a tax return. The first step is to determine if, based on the technical merits, it is more likely than not that the tax position will be sustained upon examination by a taxing authority, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement with a taxing authority. We recognize interest and penalties, if any, related to uncertain tax positions in our provision for income taxes in the consolidated statements of operations. To date, we have not recognized any tax benefits from uncertain tax positions.

ITEM 7A.7A – QUANTITATIVE AND QUALITATIVE DISCLOSURES

ABOUT MARKET RISKRISK.

 

Not applicable.

 

35

ITEM 8.8 – FINANCIAL STATEMENTS AND SUPPLEMENTARY DATADATA.

 

The financial statements required by this item are located in Item 15 beginning on page F-1 of this Annual Report on Form 10-K and are incorporated herein by reference.

 

ITEM 9.9 – CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSUREDISCLOSURE.

 

None, except as previously disclosed.

 

ITEM 9A.9A – CONTROLS AND PROCEDURESPROCEDURES.

 

Disclosure Controls and Procedures

 

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms, and that such information is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosures. Our management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management's control objectives.

 

Our management, with the participation of our CEO, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Report. Based upon this evaluation, our CEO concluded that our disclosure controls and procedures were not effective because of the identification of a material weakness in our internal control over financial reporting which is described below.

 

Management’s Report on Internal Control Over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Rule 13a-15(f). Our internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with U.S. GAAP.

 

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP and our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on our consolidated financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

36

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2016.2022. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013). Based on this evaluation, management concluded that that our internal control over financial reporting was not effective as of December 31, 2016.2022. Our CEO concluded we have a material weakness due to lack of segregation of duties, and a limited corporate governance structure.structure, and a lack of a formal management review process over preparation of financial information. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

 

Our size has prevented us from being able to employ sufficient resources to enable us to have an adequate level of supervision and segregation of duties within our system of internal control. Therefore, while there are some compensating controls in place, it is difficult to ensure effective segregation of accounting and financial reporting duties. Management reported a material weakness resulting from the combination of the following significant deficiencies:material weaknesses:

 

Lack of segregation of duties in certain accounting and financial reporting processes including the initiation, processing, recording and approval of disbursements; 

Our corporate governance responsibilities are performed by the Board of Directors, only one of whom is independent under applicable standards; we do not have an audit committee or compensation committee. Because our Board of Directors only meets periodically throughout the year, several of our corporate governance functions are not performed concurrent (or timely) with the underlying transactions including evaluation of the application of accounting principles and disclosures relating to those transactions; and 

Certain reports that we prepare and accounting and reporting conclusions reached in connection with the financial statement preparation process are not subjected to a formal review process that includes multiple levels of review, and are not submitted timely to the Board of Directors for review or approval. 

·Lack of segregation of duties in certain accounting and financial reporting processes including the initiation, processing, recording and approval of disbursements;
·Our corporate governance responsibilities are performed by the Board of Directors, none of whom are independent under applicable standards; we do not have an independent audit committee or compensation committee. Our Board of Directors acts primarily by written consent without meetings which results in several of our corporate governance functions not being performed concurrent (or timely) with the underlying transactions, including evaluation of the application of accounting principles and disclosures relating to those transactions; and
·Certain reports that we prepare and accounting and reporting conclusions reached in connection with the financial statement preparation process are not subjected to a formal review process that includes multiple levels of review, and are not submitted timely to the Board of Directors for review or approval.

 

While we strive to segregate duties as much as practicable, there is an insufficient volume of transactions at this point in time to justify additional full timefull-time staff. We believe that this is typical in many exploration stage companies. We may not be able to fully remediate the material weakness until we commence mining operations at which time, we would expect to hire more staff. We will continue to monitor and assess the costs and benefits of additional staffing.

 

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to the SEC rules that permit us to provide only management's report in this Annual Report.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2016,2022, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

ITEM 9B.9B – OTHER INFORMATIONINFORMATION.

 

None.

 

 


37

 

PART III

 

ITEM 10.10 – DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCEGOVERNANCE.

 

Directors and Executive Officers

 

Our current executive officers and directors are:

 

Name

Age

Position

John C. Power(1)

54

60

CEO, President, CFO, Secretary and Director

Brian Power(1)

51

57

Director

Leroy Wilkes

John Hiner

74

75

Director

Markus Janser55Director
Tyler Minnick53CFO

__________

(1)John C. Power and Brian Power are brothers.

 

John C. Powerhas served as a director of Athena since its inception in December 2003 and has served as Athena’s President from December 2005 to December 2007 and from January 2009 to the present and has served as Athena’s Secretary since January 2007. Hehas also served as an officer and director of Magellan Gold Corporation since its formation in September 2010.2010 until November 2020 and as an officer of Magellan from its formation until August 2017 and from January 2018 until November 2020.

 

Mr. Power is also a co-managing member since 2011 of Silver Saddle Resources, LLC that owns mining claims in Nevada.

 

From March 2010 to present, Mr. Power has severed as co-Managing Member of Ryan Air Exposition, LLC, a private California holding company that invests in antique airplanes. Mr. Power has served as President and director of Alta California Broadcasting, Inc., which operated radio stations, from December 1993 to March 2007; and President and director of Four Rivers Broadcasting, Inc., also a radio broadcaster, from May 1997 to March 2005 and Vice President from March 2005 to the present. Mr. Power has served as Co-Managing Member of Wyoming Resorts, LLC, which ownsowned and operatesoperated an historic hotel in Thermopolis, Wyoming, sincefrom June 1997; and Mr. Power has served as President of Power Curve, Inc., a private investment company, since 1986. Mr. Power has also been the managing member of Best of Sea Ranch, LLC since December 2004 which operated through a joint venture a vacation home rental business in The Sea Ranch California1997 until August 2013.June 2017. Mr. Power has been a general partner of Power Vacaville, LP a real estate investment firm since January 2008. Mr. Power also serves as the vice-president and director of The Tide Community Broadcasting, Inc. since July 2012.

 

From September 2008 to March 2012, Mr. Power served as an officer and director of Hungry Hunter, Inc., a private California-based restaurant enterprise. From March 2008 until February 2010, Mr. Power served as a director of Reserve Energy Corporation, a small private oil and gas exploration and production company; and was Managing Member of Montana Resorts, LLC, which is a holding company for Yellowstone Gateway Resorts, LLC,(from May 2002 until May 2008; and was Managing Member of Yellowstone Gateway Resorts, LLC, which owned and operated the Gallatin Gateway Inn, from May 2002 until May 2008. On November 16, 2004, Yellowstone Gateway Resorts, LLC filed a voluntary petition in bankruptcy under Chapter 11 of the U.S. Bankruptcy Code in response to an adverse arbitration award in favor of a former employee. Yellowstone Gateway Resorts, LLC was successfully reorganized under Chapter 11.

Mr. Power attended, but did not receive a degree from, Occidental College and University of California at Davis.

 

38

Brian Powerhas served as an officer/director of the company since its inception in December 2003. He was CEO and President from December 2003 until December 2005 and currently serves as a director of the company. From 1997 to 2014 Mr. Power served as CEO and President of Lone Oak Vineyards, Incorporated, a real estate/agricultural investment company.  From October 1998 to 2005, he was a co-founder and managing member of Spirit of Adventure, LLC a company engaged in the development of deep ocean exploration technologies including the design/build of advanced manned submersibles. From 1996 through the present he serves on the board of directors of Snuba, Incorporated, a manufacturer and international licensor of proprietary ocean diving systems. From 2014 through the present, Mr. Power founded and is the managing member of Asperatus LLC, a company engaged in the development of airborne remote earth sensing technologies and related data processing analytics. Mr. Power attended Solano Community College and the University of California at Davis.

 

LeRoy WilkesJohn Hiner is a director of the Issuer and provides his services to the Issuer on a part-time basis. He has served as a director of the Issuer since August 2011. March 22, 2021 and will devote approximately 10% of his time to the affairs of the Issuer. As a director, he is responsible for directing and overseeing management of the Issuer.

Mr. WilkesHiner is a licensed geologist in the State of Washington (2002) and SME registered member (2012) and he has vastan exploration history of over 45 years with several major mining companies exploring for geothermal energy, precious metals and industrial minerals. He has served as a director and/or officer of mineral exploration and mining development companies and works as an independent consulting geologist for mining companies. Previously, Mr. Hiner was an officer of Geocom Resources Inc. (from 2003 to 2013) and a director of Red Pine Petroleum Ltd. (from 2003 to 2013), Straightup Resources Inc. (from 2017 to 2021) and Gold Basin Resources Corporation (from 2017-2021). Mr. Hiner is currently a director of Golden Lake Exploration Inc. (since 2018).

Mr. Janser has been a director of the Issuer since March 22, 2021 and provides his services to the Issuer on a part-time basis. He will devote approximately 5% of his time to the affairs of the Issuer. As a director, he is responsible for directing and overseeing management of the Issuer.

Mr. Janser has 20 years of experience as a professionalsenior executive and business consultant in private and offshore banking, finance and investment, project management, junior mining engineer.and exploration and property development. He was also the founding partner of a retail textile company, a financial service group and a property development company. Mr. Janser holds a Master of Arts in Economics from the University of Fribourg, Switzerland (March 1994). Currently, Mr. Janser is formerlyalso a director of Nubian Resources Ltd., a position he has held since December 2009.

Tyler Minnick has been the PresidentChief Financial Officer of Washington Group International, Inc.’s Mining Business Unit,the Issuer since May 6, 2021 and provides his services to the Issuer on a part-time basis. He will devote approximately 10 hours per month of his time to the affairs of the Issuer.

Since December 2018, Mr. Minnick has acted as a Certified Public Accountant (1993) with Grand Mesa CPAs, LLC, and from which2011 to the present he retired in 2007. In that capacity, he oversaw mining development operations throughout the world. Washington Group International merged with URS Corporation in 2007.has worked for Augusta Gold Corp. as a consultant, (formerly, Bullfrog Gold Corp.), and was its Chief Financial Officer until October 2020. From 1988May 2018 to 1995,September 2018, he was a financial reporting manager with Bowie Resources, LLC. From September 2014 to May 2018 Mr. Minnick acted as the Chief Operating OfficerDirector of Santa Fe Pacific Gold CorporationFinance and was involvedAdministration of the Grand Junction Regional Airport Authority. Mr. Minnick has 11 years of experience in the expansion of their Nevada operations. Santa Fe Pacific Gold Corporation merged with Newmont Mining Corporation in 1997. From 1980 to 1986, Mr. Wilkes was Director of Business Development for Anaconda Minerals Company, where he was involved in such projects as Greens Creek, Alaska, Stillwater, Montana and Las Pelambres in Chile.mining industry.

 

Mr. Wilkes is retired, and also serves as a Director of Quaterra Resources, Inc. and Sabina Gold and Silver Corp. He holds a B.A. degree from the Montana School of Mines.

39

 

Involvement in Certain Legal Proceedings

 

During the last 10 years, except as disclosed above, none of our directors or officers has:

 

a.had any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

 

b.been convicted in a criminal proceeding or subject to a pending criminal proceeding;

 

c.been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

 

d.been found by a court of competent jurisdiction in a civil action, the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

On June 1, 1998, the SEC issued an Order instituting proceedings alleging, among other things, that Mr. Power violated Section 10(b) of the Exchange Act and Rule 10(b)(5) promulgated thereunder by participating in a manipulation through his personal account of the public trading market for the stock of Premier Concepts, Inc., from approximately June 1994 through December 1994. On November 15, 2005, the US Court of Appeals for the District of Columbia Circuit issued an Opinion and Order dismissing the matter.

 

Our executive officers are elected at the annual meeting of our Board of Directors held after each annual meeting of our shareholders. Our directors are elected at the annual meeting of our shareholders. Each director and executive officer holds office until his successor is duly elected and qualified, until his resignation or until he is removed in the manner provided by our by-laws.

 

Family Relationships

 

John C. Power and Brian Power are brothers. There do not exist any arrangements or understandings between any director and any other person pursuant to which any director was elected as such.

 

Director Independence

 

Our common stock is listed on the OTC Market Inc.’s OTCQB and OTC Pinks inter-dealer quotation systems, which does not have director independence requirements. Nevertheless, for purposes of determining director independence, we have applied the definition set forth in NASDAQ Rule 4200(a)(15). The following directors are considered “independent” as defined under Rule 4200(a)(15): LeRoy Wilkes.None. John C. Power and Brian Power would not be considered “independent” under the NASDAQ rule due to the fact that John C. Power is an officer and Brian Power is John C. Power’s brother. John Hiner and Markus Janser are considered independent.

 

Board Meetings

 

During the year ended December 31, 2016, we had three directors.2022, Our Board held nofour meetings but has takenand took numerous actions by unanimous written consent.

 

Committees of the Board of Directors

 

We currently do not have standing audit, compensation or nominating committees of the Board of Directors. We do have an audit committee that consists of Brian Power, John Hiner and Markus Janser. We plan to form audit, compensation and nominating committees when it is necessary to do so to comply with federal securities laws or to meet listing requirements of a stock exchange or the Nasdaq Capital Market.

40

 

Compliance with Section 16(a), Beneficial Ownership

 

Under the Securities Laws of the United States, our directors, executive (and certain other) officers, and any persons holding more than ten percent (10%) of our common stock during any part of our most recent fiscal year are required to report their ownership of common stock and any changes in that ownership to the SEC. Specific due dates for these reports have been established and we are required to report in this Report any failure to file by these dates. During the year ended December 31, 2016,2022, all of these filing requirements were satisfied by our officers, directors, and ten- percent holders, except that Mr.John Gibbs failed to file twothree reports, covering threetwelve transactions in a timely fashion.manner and Messrs. Brian Power, Tyler Minnick, Markus Janser, John Hiner and John Power each failed to file one report covering two transactions in a timely manner. In making these statements, we have relied on the written representation of our directors and officers or copies of the reports that they have filed with the Commission.

 

Code of Ethics

 

We have adopted a Code of Ethics that apples to, among other persons, our company’s principal executive officer, as well as persons performing similar functions. As adopted, our Code of Ethics sets forth written guidelines to promote:

 

honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; 

full, fair, accurate, timely and understandable disclosure in all reports and documents that we file with, or submit to, the SEC and in other public communications made by us that are within the executive officer’s area of responsibility; 

compliance with applicable governmental laws, rules and regulations; 

the prompt internal reporting of violations of the Code; and 

accountability for adherence to the Code. 

·honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
·full, fair, accurate, timely and understandable disclosure in all reports and documents that we file with, or submit to, the SEC and in other public communications made by us that are within the executive officer’s area of responsibility;
·compliance with applicable governmental laws, rules and regulations;
·the prompt internal reporting of violations of the Code; and
·accountability for adherence to the Code.

 

Our Code of Ethics has been filed with the SEC as Exhibit 14 to our Annual Report on Form 10-KSB for the fiscal year ended December 31, 2006, as filed with the SEC on April 24, 2007. We will provide a copy of the Code of Ethics to any person without charge, upon request. Requests can be sent to: Athena SilverGold Corporation, 2010A Harbison Drive # 312, Vacaville, CA 95687.

 

ITEM 11.EXECUTIVE11 – EXECUTIVE COMPENSATION

 

Director Compensation

 

The following table summarizes all directorshows compensation inpaid to our directors (excluding compensation included under our summary compensation table above) for service as directors during the most recent fiscal year ended December 31, 2016. There are no standard compensation arrangements in place for our directors.2022.

 

Director Compensation

Fees

Earned or

Paid in

Cash

Stock

Awards

Option

Awards

All Other

Compensation

Total

Name

 

 

Fees Earned or Paid in Cash

($)

 

 

Option

Awards

($)

 

 

All Other

Compensation

($)

 

 

Total

($)

($)($)*($)

Leroy Wilkes1

12,000

 

 

12,000

 

 

 

 

John C. Power **$0

Brian Power

 

 

 

$0$7,500$23,580$0$31,080

 

 

 

 

John Hiner$0$7,500$23,580$0$31,080
Markus Janser$0$7,500$23,580$0$31,080

 

1 Mr. Wilkes earns a retainer fee for serving as a Director of $12,000 per year, payable quarterly. Mr. Wilkes has 200,000 options outstanding at December 31, 2016.* Represents the aggregate grant date fair value computed in accordance with FASB 123.

** Compensation disclosed in Executive Compensation table.

41

 

Executive Compensation

 

The table below sets forth, for the last two fiscal years, the compensation earned by our named executive officers forconsisting of our chief executive officer and chief financial officer. No other executive officer had annual compensation in excess of $100,000 during the most recentlast two fiscal year ended December 31, 2016 are as follows:years.

 

John C. Power, CEO, President, CFO, Secretary and director.

Summary Compensation Table

 

The following table sets forth all compensation recorded by us to Mr. Power during the years ended December 31, 2016 and 2015:

Summary Compensation Table

Name

and

Principal

Position

 

 

Year

 

 

Salary

($)

 

 

Bonus

($)

 

 

Stock

Awards

($)

 

 

Option

Awards

($)

 

Non-Equity

Incentive Plan

Compensation

($)

Nonqualified

Deferred

Compensation

Earnings

($)

 

 

All Other

Compensation

($)

 

 

Total

($)

John C. Power, President

2016

30,000

 

30,000

 

2015

30,000

30,000

 

 

 

 

 

 

 

 

 

 

Name and

Principal

Position

 Year 

Salary

($)

  

Bonus

($)

  

Stock

Awards

($)(1)

  

Option

Awards

($)(1)

  

Non-Equity

Incentive Plan

Compensation

  

Nonqualified

Deferred

Compensation

Earnings

  

All Other
Compensation

($)

  

Total

($)

 
(a) (b) (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j) 
John C. Power,  2022 $30,000  $0  $7,500  $23,580  $0  $0  $0  $61,080 
Chief Executive Officer  2021 $30,000  $0  $0  $0  $0  $0  $0  $30,000 
                                    
Tyler Minnick,  2022 $0  $0  $3,750  $11,790  $0  $0  $21,240  $36,780 
Chief Financial Officer(2)  2021 $0  $0  $0  $0  $0  $0  $9,000  $9,000 

 

(1) Represents the aggregate grant date fair value computed in accordance with FASB 123.

(2)Mr. Power is our only executive officer. We entered into a one yearMinnick’s Other Compensation were consulting agreement with Mr. Power at the rate of $30,000 per yearfees paid for his part-time serviceservices as our President. Mr. Power devotes approximately 25% of his time and attention to our business.Chief Financial Officer.

 

Employment Agreements

 

We do not have any written employment agreements other than the above-referenced consulting agreement with any of our executive officers; nor do we have or maintain key man life insurance on Mr. Power.

 

Equity Incentive Plan

 

Equity Incentive Plan

42

 

On December 10, 2004, we adopted our 2004 Equity Incentive Plan (the “Plan”) for our officers, directors and other employees, plus outside consultants and advisors. Under the Plan, our employees, outside consultants and advisors may receive awards of non-qualified options and incentive options, stock appreciation rights or shares of stock. As required by Section 422 of the Internal Revenue Code of 1986, as amended, the aggregate fair market value of our common stock underlying incentive stock options granted to an employee exercisable for the first time in any calendar year may not exceed $100,000. The foregoing limitation does not apply to non-qualified options. The exercise price of an incentive option may not be less than 100% of the fair market value of the shares of our common stock on the date of grant. The same limitation does not apply to non-qualified options. An option is not transferable, except by will or the laws of descent and distribution. If the employment of an optionee terminates for any reason, (other than for cause, or by reason of death, disability or retirement), the optionee may exercise his options within a 90-day period following such termination to the extent he was entitled to exercise such options at the date of termination. A maximum of 500,000 shares of our common stock are subject to the Plan. The purpose of the Plan is to provide employees, including our officers, directors, and non-employee consultants and advisors with an increased incentive to make significant and extraordinary contributions to our long-term performance and growth, to join their interests with the interests of our shareholders, and to facilitate attracting and retaining employees of exceptional ability.

The Plan may be administered by the Board or in the Board's sole discretion by the Compensation Committee of the Board or such other committee as may be specified by the Board to perform the functions and duties of the Committee under the Plan. Subject to the provisions of the Plan, the Committee and the Board shall determine, from those eligible to be participants in the Plan, the persons to be granted stock options, stock appreciation rights and restricted stock, the amount of stock or rights to be optioned or granted to each such person, and the terms and conditions of any stock option, stock appreciation rights and restricted stock.

As of the date of this Report, there are 150,000 options outstanding that have been granted under the Plan. As the termination date of the Plan has passed, we can no longer make additional award grants under the Plan.

 

Outstanding Equity Awards at Fiscal Year-End

 

The following table sets forth information concerning unexercisedthe stock options stock that has not vested and equity incentive plan awards for eachgranted to our named executive officer outstandingofficers during the year, as of the end of the most recently completed fiscal year:December 31, 2022.

 

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END TABLE

Option Awards

Stock Awards

Option Awards Stock Awards

Name

 

 

Number of

Securities

Underlying

Unexercised

Options

 

Exercisable

 

 

Number of

Securities

Underlying

Unexercised

Options

 

Unexercisable

 

 

Equity

Incentive

Plan

Awards;

Number of

Securities

Underlying

Unexercised

Unearned

Options

 

 

Option

Exercise

Price

 

 

Option

Exercise

Date

 

 

Number of

Shares or

Units of

Stock That

Have Not

Vested

 

 

Market

Value of

Shares of

Units That

Have Not

Vested

 

Equity

Incentive

Plan

Awards;

Number of

Unearned

Shares,

Units or

Other

Rights

That Have

Not

Vested

Equity

Incentive

Plan

Awards;

Market or

Payout

Value of

Unearned

Shares,

Units or

Other

Rights

That Have

Not

Vested

Number of

Securities

Underlying

Unexercised

Options:

(#)

Exercisable

Number of

Securities

Underlying

Unexercised

Options:

(#)

Unexercisable

Option

Exercise

Price ($)

Expiration

Date

 

Number of

Shares

or Units

of Stock

that Have

Not

Vested (#)

John C. Power

200,000

-0-

-0-

$ 0.26

April 2013

-0-

-0-

-0-

500,0000$0.0610/12/2032 0
Brian Power500,0000$0.0610/12/2032 0
John Hiner500,0000$0.0610/12/2032 0
Markus Janser500,0000$0.0610/12/2032 0
Tyler Minnick250,0000$0.0610/12/2032 0

  

Expense Reimbursement

 

We will reimburse our officers and directors for reasonable expenses incurred during the course of their performance.

 

Retirement Plans and Benefits

 

None.

 

Indemnification of Directors and Officers

 

Our bylaws contain provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for:

 

·any breach of the director’s duty of loyalty to us or our stockholders,
·any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law,
·unlawful payments of dividends or unlawful stock repurchases, or redemptions as provided in Section 174 of the Delaware General Corporation Law, or
·any transaction from which the director derived an improper personal benefit.

 

any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law, 

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law, or 

any transaction from which the director derived an improper personal benefit. 

43

 

Our bylaws provide that we are required to indemnify our directors and executive officers to the fullest extent permitted by Delaware law. Any repeal of or modification to our restated certificate of incorporation or bylaws may not adversely affect any right or protection of a director or executive officer for or with respect to any acts or omissions of such director or executive officer occurring prior to such amendment or repeal. Our bylaws also provide that we may advance expenses incurred by a director or executive officer in advance of the final disposition of any action or proceeding and permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in that capacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law. We believe that these bylaw provisions are necessary to attract and retain qualified persons as directors and officers.

 

The limitation of liability and indemnification provisions in our bylaws may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. They may also reduce the likelihood of derivative litigation against our directors and executive officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and executive officers as required by these indemnification provisions. At present, there is no pending litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.

 

ITEM 12.12 – SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSMATTERS.

 

The following table sets forth information with respect to beneficial ownership of our common stock by:

 

*

·

each person who beneficially owns more than 5% of our common stock;

*

·each of our named executive officers;

*

·each of our directors; and

*

·all named executive officers and directors as a group.

44

 

The following table shows the number of shares owned as of December 31, 20162022, and the percentage of outstanding common stock owned as of that date. Each person has sole voting and investment power with respect to the shares shown, except as noted.

 

 

 

Name and Address of

Beneficial Owner(1)

Amount

and Nature of

Beneficial

Ownership(2)

 

Ownership as a

Percentage of

Outstanding

Common Shares(3)

 

 

 

 

John Gibbs

807 Wood N Creek

Ardmore, OK 73041

16,726,124

(4)

46.20

 

 

 

 

John C. Power

 

4,843,000

(5)

13.3

Clifford L. Neuman

8300 Greenwood Drive

Niwot, CO, 80503

 

3,584,030

(8)

9.9

Bruce and Elizabeth Strachan,

Trustees UTA dtd 7/25/07

2,880,047

 

8.0

P.O. Box 577, Joshua Tree, CA 92252-0577

 

 

 

 

 

 

 

Brian Power

300,000

(6)

nil

 

 

 

 

LeRoy Wilkes

200,000

(7)

nil

 

 

 

 

 

 

 

 

All officers and directors as a group

(three persons)

5,343,000

 

14.75

Name and Address of

Beneficial Owner(1)

 

Amount

and Nature of

Beneficial

Ownership (2)

  

Ownership as a

Percentage of

Outstanding

Common Shares(3)

 
       
John C. Power (4)  10,523,238   7.69% 
         
Brian Power (5)  1,850,000   1.35% 
         
John Hiner (5)  1,150,000   0.84% 
         
Markus Janser (5)  1,150,000   0.84% 
         
Tyler Minnick (6)  575,000   0.42% 
         
All officers and directors as a group (five persons)  15,248,238   11.14% 
         
Nubian Resources, Ltd.
2526 Yale Court
Abbostford, BC V2S 8G9
  50,000,000   36.74% 
         
John Gibbs (7)
807 Wood N Creek
Ardmore, OK 73041
  40,589,470   28.48% 

 

(1)

Unless otherwise stated, address is 2010A Harbison Drive # 312, Vacaville, CA 95687.

(2)

Under SEC Rules, we include in the number of shares owned by each person the number of shares issuable under outstanding options or warrants if those options or warrants are exercisable within 60 days of the date of this Annual Report.prospectus. In calculating percentage ownership, we calculate the ownership of each person who owns exercisable options by adding (i) the number of exercisable options for that person only to (ii) the number of total shares outstanding and dividing that result into (iii) the total number of shares and exercisable options owned by that person.

(3)

Shares and percentages beneficially owned are based upon 36,202,320136,091,400 shares outstanding on December 31, 2016.

2022

(4)

Includes 5,165,000300,000 warrants and 500,000 options.

(5)Includes 1,000,000 options.
(6)Includes 250,000 options.
(7)Includes 5,655,000 shares owned by TriPower Resources, Inc., of which John D. Gibbs is President and controlling shareholder.

(5)

Includes optionsshareholder; includes 500,000 shares owned by Redwood Microcap Fund, of which Mr. Gibbs is a control person; and includes Warrants exercisable to acquire 200,000purchase 6,435,202 shares of common stock which expire in April 2018.

(6)

Includes options to acquire 200,000 shares of common stock which expire in April 2018

(7)

(8)

Includes options to acquire 200,000 shares of common stock which expire in April 2018.

Includes 3,030,523 shares of common stock and an additional 553,507 shares of common stock issuable in partial conversion of a convertible promissory note in the principal amount of $51,270 convertible into shares of common stock at a conversion price of $0.0735 per share. The convertible note has a blocker provision that precludes its conversion if as a result of such conversion the holder would own more than 9.9% of the Company’s total issued and outstanding shares.

Common Stock.

 

45

ITEM 13.13 – CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

AND DIRECTOR INDEPENDENCEINDEPENDENCE.

 

Except as disclosed herein and in the Notes to Financial Statements, there have been no transactions or proposed transactions in which the amount involved exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal years in which any of our directors, executive officers or beneficial holders of more than 5% of the outstanding shares of our common stock, or any of their respective relatives, spouses, associates or affiliates, has had or will have any direct or material indirect interest.

The information required by this Item is located in the Notes to our consolidated financial statements included in Item 15 beginning on page F-1 of this Annual Report on Form 10-K and are incorporated herein by reference.

 

Director Independence

 

Our common stock is listed on the OTC Market Inc.’s OTQB and OTC Pinks inter-dealer quotation systems, which does not have director independence requirements. Nevertheless, for purposes of determining director independence, we have applied the definition set forth in NASDAQ Rule 4200(a)(15). The following directors are considered “independent” as defined under Rule 4200(a)(15): Leroy Wilkes. John C. Power and Brian Power would not be considered “independent” under the NASDAQ rule due to the fact that John C. Power is an officer and Brian Power is John C. Power’s brother.

 

ITEM 14.14 – PRINCIPAL ACCOUNTING FEES AND SERVICESSERVICES.

 

We understand the need for our principal accountants to maintain objectivity and independence in their audit of our financial statements. To minimize relationships that could appear to impair the objectivity of our principal accountants, our Board of Directors has restricted the non-audit services that our principal accountants may provide to us primarily to tax services and audit-related services. We are only to obtain non-audit services from our principal accountants when the services offered by our principal accountants are more effective or economical than services available from other service providers, and, to the extent possible, only after competitive bidding. These determinations are among the key practices adopted by the Board of Directors. Our Board has adopted policies and procedures for pre-approving work performed by our principal accountants.

 

The aggregate fees billed for the years ended December 31, 20162022, and 2015,2021 for professional services rendered by our principal accountants for the audit of our annual financial statements and review of the financial statements included in our Quarterly Reports on Form 10-Q and services that are normally provided by our accountants in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

 

 

2016

 

2015

 2022 2021 

Audit fees - audit of annual financial statements and review of financial statements included in our quarterly reports, services normally provided by the accountant in connection with statutory and regulatory filings

 

$ 23,850

 

$ 22,400

 $51,900  $40,500 
        

Audit-related fees - related to the performance of audit or review of financial statements not reported under "audit fees"

 

0

 

0

      
        

Tax fees - tax compliance, tax advice and tax planning

 

0

 

0

  3,000   5,000 
        

All other fees - services provided by our principal accountants other than those identified above

 

0

 

0

  14,000   5,500 
        

Total fees

 

$ 23,850

 

$ 22,400

 $68,900  $51,000 

 

After careful consideration, the Board of Directors has determined that payment of the audit fees is in conformance with the independent status of our principal independent accountants.

 

 


46

 

PART IV

 

ITEM15ITEM 15 – EXHIBITS AND FINANCIAL STATEMENT SCHEDULESSCHEDULES.

 

 

 

(1)

2.1

Asset Purchase and Sale Agreement dated October 8, 2004

(1)

2.2

Amendment No. 1 to Asset Purchase and Sale Agreement

(1)

2.3

Amendment No. 2 to Asset Purchase and Sale Agreement dated July 31, 2005

(1)

2.4

Amendment No. 3 to Asset Purchase and Sale Agreement dated August 31, 2005

(1)

3.1

Amended and Restated Certificate of Incorporation

(3)

3.1.1

Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock

(1)

3.2

By-Laws

(1)

4.1

2004 Equity Incentive Plan

(1)

4.2

Form of Subscription Agreement

(1)

4.3

Specimen common stock certificate

(1)

10.1

Lease Agreement

(1)

10.2

Form of Escrow Agreement

(1)

10.3

Amended Trademark Assignment

(1)

10.3.2

Initial Assignment of Trademark

(1)

10.4

Lock-up Letter for Brian Power

(1)

10.5

Lock-up Letter for John C. Power

(1)

10.6

Lock-up Letter for J. Andrew Moorer

(1)

10.7

Amended Fund Escrow Agreement

(1)

10.8

Lease Agreement with Golden West Brewing Company

(1)

10.9

Security Agreement in favor of Power Curve, Inc., Lone Oak Vineyards, Inc. and Tiffany Grace.

(1)

10.10

Promissory Note dated September 9, 2005, Tiffany Grace, Holder

(1)

10.11

Promissory Note dated September 9, 2005, Lone Oak Vineyards, Inc., Holder

(1)

10.12

Promissory Note dated September 9, 2005, Power Curve, Inc., Holder

(1)

10.13

Assignment and Assumption dated August 31, 2005 between Butte Creek Brewing Company, LLC, Golden West Brewing Company and Golden West Brewing Company, Inc.

(1)

10.14

Amended and Restated Assignment and Assumption

(1)

10.15

August 7, 1998 Distribution Agreement

(1)

10.16

Territorial Agreement

(1)

10.17

November 4, 2002 Distribution Agreement

(1)

10.18

June 1, 2001 Authorization

(1)

10.19

July 22, 2004 Authorization

(1)

10.20

September 1, 2005 Authorization

(1)

10.22

Second Amended Fund Escrow Agreement

(1)

10.23

Contract with New Zealand Hops, Ltd., 2006

(1)

10.24

Contract with New Zealand Hops, Ltd., 2007

(1)

10.25

Second Amended and Restated Assignment and Assumption

(1)

10.26

Third Amended Fund Escrow Agreement

(1)

10.27

Secured Promissory Note with John C. Power

(1)

10.28

Secured Promissory Note with Power Curve, Inc.

(1)

10.29

General Security Agreement with John C. Power and Power Curve, Inc.

(2)

10.30

Production Agreement with Bison Brewing Co.

(2)

10.31

Employment Agreement with David Del Grande

(2)

10.32

License, Production and Distribution Agreement dated November 1, 2006 with Mateveza USA, LLC

(4)

10.33

Employment Agreement with Mark Simpson

(4)

10.34

Consultation Agreement with Artisan Food and Beverage Group

(5)

10.35

Credit Agreement dated December 11, 2007

(6)

10.36

Promissory Note dated March 12, 2008

(6)

10.37

Security Agreement dated March 12, 2008

(6)

10.38

Guaranty Agreement dated March 12, 2008

(7)

10.39

Convertible Debenture dated December 31, 2008

(7)

10.40

Security Agreement dated December 31, 2008

(7)

10.41

Hypothecation Agreement dated December 31, 2008

(8)

10.42

Mendocino Production Agreement

(9)

10.43

Exclusive Consignment Agency Agreement

(10)

10.44

Settlement Stipulation with BRK Holdings, LLC

(11)

10.45

Promissory Note dated April 28, 2009 in favor of Clifford Neuman

(11)

10.46

Security Agreement dated April 28, 2009 in favor of Clifford Neuman

(11)

10.47

Guaranty of John C. Power dated April 28, 2009 in favor of Clifford Neuman

(11)

10.48

Promissory Note dated April 28, 2009 in favor of John C. Power

(11)

10.49

Security Agreement dated April 28, 2009 in favor of John C. Power

(11)

10.50

Promissory Note dated April 28, 2009 in favor of Butte Creek Brands, LLC

(11)

10.51

Security Agreement dated April 28, 2009 in favor of Butte Creek Brands LLC

(11)

10.52

Factoring Agreement dated April 28, 2009

(12)

10.53

Agreement to Convert Debt Clifford L. Neuman PC

(12)

10.54

Agreement to Convert Debt Clifford L. Neuman

(12)

10.55

Agreement to Convert Debt John Power

(12)

10.56

Agreement to Convert Debt Sea Ranch Lodge and Village, LLC

(12)

10.57

Agreement to Convert Debt TriPower Resources, Inc.

(12)

10.58

Agreement to Convert Debt TriPower Resources, Inc.

(12)

10.59

Agreement to Convert Debt Redwood MicroCap Fund, Inc.

(12)

10.60

Agreement to Convert Debt Shana Capital, Ltd.

(13)

10.61

Asset Purchase Agreement dated May 7, 2009

(14)

10.62

Certificate of Amendment to Amended and Restated Certificate of Incorporation

(14)

10.63

Articles of Incorporation of Athena Minerals, Inc.

(15)

10.64

Sale and Purchase Agreement and Joint Escrow Instructions dated December 9, 2009

(15)

10.65

Assignment of Sale and Purchase Agreement and Joint Escrow Instructions dated

January 5, 2010

(15)

10.66

Promissory Note from Athena Minerals, Inc. to John Power dated January 5, 2010

(16)

10.67

Mining Lease and Option to Purchase dated March 11, 2010

(17)

10.68

Intellectual Property Assignment dated June 25, 2010

(18)

10.69

Promissory Notes John C. Power and John D. Gibbs dated June 30, 2010

(19)

10.70

Promissory Note John D. Gibbs dated August 3, 2010

(20)

10.71

Agreement to Convert Debt – Clifford L. Neuman

(21)

10.72

Agreements to Convert Debt – Donaldson and Kirby

(22)

10.73

Agreement to Convert Debt – Clifford L. Neuman

(23)

10.74

Agreement to Convert Debt – Huss and Strachan

(24)

10.75

Stock Purchase Agreement; Indemnity Agreement and Amendment No. 1 to Indemnity Agreement each dated December 31, 2010

(25)

10.76

Consent of Schumacher & Associates dated March 7, 2011

(26)

10.77

Marketing Agreement with Bill Fishkin dated April 1, 2011

(26)

10.78

Agreement to Convert Debt with Donaldson Consulting Services, Inc. dated May 31, 2011

(27)

10.79

Term Sheet with LeRoy Wilkes dated July 14, 2011

(28)

10.80

Accredited Members Agreement dated August 31, 2011

(29)

10.81

Promissory Note – John D. Gibbs dated October 26, 2011

(29)

10.82

Promissory Note – John D. Gibbs dated November 15, 2011

(30)

10.83

Marketing Agreement with Bill Fishkin dated December 1, 2011

(31)

10.84

Advisor Agreement with GVC Capital, LLC dated January 30, 2012

(32)

10.85

Promissory Note – John D. Gibbs dated March 18, 2012

(33)

10.86

Promissory Note – John D. Gibbs dated February 2, 2012

(34)

10.87

Promissory Note – John D. Gibbs dated April 27, 2012

(35)

10.88

Agreement to Convert Debt – John D. Gibbs

(36)

10.89

Promissory Note – John D. Gibbs dated May 22, 2012

(36)

10.90

Assignment of Right to Purchase Property

(37)

10.91

Agreement to Convert Debt – John Donaldson

(38)

10.92

Credit Agreement – John D. Gibbs

(38)

10.93

Form of Credit Note

(39)

10.94

Amendment No. 1 to Langtry Lease Agreement

(40)

10.95

Allonge and Modification Agreement with John D. Gibbs

(41)

10.96

Amendment No. 2 to Langtry Lease Agreement

(42)

10.97

Second Allonge and Modification Agreement with John D. Gibbs

(43)

10.98

Amendment No. 3 to Langtry Lease Agreement

(44)

10.99

Third Allonge and Modification Agreement with John D. Gibbs

(44)

10.100

Amendment to Power Consultation Agreement

(45)

10.101

Promissory Note – Clifford L. Neuman dated April 1, 2015

(46)

10.102

Lease/Purchase Option Agreement

(47)

10.103

Fifth Allonge and Modification Agreement with John D. Gibbs

(48)

10.104

Promissory Note – John Power dated September 12, 2016

(2)

14

Code of Ethics

(1)

21.0

List of Subsidiaries

#

31.

Certification required by Section 13a-14(a) of the Exchange Act.

#

32.

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(1)2.1Asset Purchase and Sale Agreement dated October 8, 2004
(1)2.2Amendment No. 1 to Asset Purchase and Sale Agreement
(1)2.3Amendment No. 2 to Asset Purchase and Sale Agreement dated July 31, 2005
(1)2.4Amendment No. 3 to Asset Purchase and Sale Agreement dated August 31, 2005
(1)3.1Amended and Restated Certificate of Incorporation
(3)3.1.1Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock
(1)3.2By-Laws
(1)4.12004 Equity Incentive Plan
(1)4.2Form of Subscription Agreement
(1)4.3Specimen common stock certificate
(1)10.1Lease Agreement
(1)10.2Form of Escrow Agreement
(1)10.3Amended Trademark Assignment
(1)10.3.2Initial Assignment of Trademark
(1)10.4Lock-up Letter for Brian Power
(1)10.5Lock-up Letter for John C. Power
(1)10.6Lock-up Letter for J. Andrew Moorer
(1)10.7Amended Fund Escrow Agreement
(1)10.8Lease Agreement with Golden West Brewing Company
(1)10.9Security Agreement in favor of Power Curve, Inc., Lone Oak Vineyards, Inc. and Tiffany Grace.
(1)10.10Promissory Note dated September 9, 2005, Tiffany Grace, Holder
(1)10.11Promissory Note dated September 9, 2005, Lone Oak Vineyards, Inc., Holder
(1)10.12Promissory Note dated September 9, 2005, Power Curve, Inc., Holder
(1)10.13Assignment and Assumption dated August 31, 2005 between Butte Creek Brewing Company, LLC, Golden West Brewing Company and Golden West Brewing Company, Inc.
(1)10.14Amended and Restated Assignment and Assumption
(1)10.15August 7, 1998 Distribution Agreement
(1)10.16Territorial Agreement
(1)10.17November 4, 2002 Distribution Agreement
(1)10.18June 1, 2001 Authorization
(1)10.19.July 22, 2004 Authorization
(1)10.20September 1, 2005 Authorization
(1)10.22Second Amended Fund Escrow Agreement
(1)10.23Contract with New Zealand Hops, Ltd., 2006
(1)10.24Contract with New Zealand Hops, Ltd., 2007
(1)10.25Second Amended and Restated Assignment and Assumption
(1)10.26Third Amended Fund Escrow Agreement
(1)10.27Secured Promissory Note with John C. Power
(1)10.28Secured Promissory Note with Power Curve, Inc.
(1)10.29General Security Agreement with John C. Power and Power Curve, Inc.

47

(51)10.30Production Agreement with Bison Brewing Co.
(51)10.31Employment Agreement with David Del Grande
(2)10.32License, Production and Distribution Agreement dated November 1, 2006 with Mateveza USA, LLC
(4)10.33Employment Agreement with Mark Simpson
(4)10.34Consultation Agreement with Artisan Food and Beverage Group
(5)10.35Credit Agreement dated December 11, 2007
(6)10.36Promissory Note dated March 12, 2008
(6)10.37Security Agreement dated March 12, 2008
(6)10.38Guaranty Agreement dated March 12, 2008
(7)10.39Convertible Debenture dated December 31, 2008
(7)10.40Security Agreement dated December 31, 2008
(7)10.41Hypothecation Agreement dated December 31, 2008
(8)10.42Mendocino Production Agreement
(9)10.43Exclusive Consignment Agency Agreement
(10)10.44Settlement Stipulation with BRK Holdings, LLC
(11)10.45Promissory Note dated April 28, 2009 in favor of Clifford Neuman
(11)10.46Security Agreement dated April 28, 2009 in favor of Clifford Neuman
(11)10.47Guaranty of John C. Power dated April 28, 2009 in favor of Clifford Neuman
(11)10.48Promissory Note dated April 28, 2009 in favor of John C. Power
(11)10.49Security Agreement dated April 28, 2009 in favor of John C. Power
(11)10.50Promissory Note dated April 28, 2009 in favor of Butte Creek Brands, LLC
(11)10.51Security Agreement dated April 28, 2009 in favor of Butte Creek Brands LLC
(11)10.52Factoring Agreement dated April 28, 2009
(12)10.53Agreement to Convert Debt Clifford L. Neuman PC
(12)10.54Agreement to Convert Debt Clifford L. Neuman
(12)10.55Agreement to Convert Debt John Power
(12)10.56Agreement to Convert Debt Sea Ranch Lodge and Village, LLC
(12)10.57Agreement to Convert Debt TriPower Resources, Inc.
(12)10.58Agreement to Convert Debt TriPower Resources, Inc.
(12)10.59Agreement to Convert Debt Redwood MicroCap Fund, Inc.
(12)10.60Agreement to Convert Debt Shana Capital, Ltd.
(13)10.61Asset Purchase Agreement dated May 7, 2009
(14)10.62Certificate of Amendment to Amended and Restated Certificate of Incorporation
(14)10.63Articles of Incorporation of Athena Minerals, Inc.
(15)10.64Sale and Purchase Agreement and Joint Escrow Instructions dated December 9, 2009
(15)10.65Assignment of Sale and Purchase Agreement and Joint Escrow Instructions dated January 5, 2010
(15)10.66Promissory Note from Athena Minerals, Inc. to John Power dated January 5, 2010
(16)10.67Mining Lease and Option to Purchase dated March 11, 2010
(17)10.68Intellectual Property Assignment dated June 25, 2010
(18)10.69Promissory Notes John C. Power and John D. Gibbs dated June 30, 2010

48

(19)10.70Promissory Note John D. Gibbs dated August 3, 2010
(20)10.71Agreement to Convert Debt – Clifford L. Neuman
(21)10.72Agreements to Convert Debt – Donaldson and Kirby
(22)10.73Agreement to Convert Debt – Clifford L. Neuman
(23)10.74Agreement to Convert Debt – Huss and Strachan
(24)10.75Stock Purchase Agreement; Indemnity Agreement and Amendment No. 1 to Indemnity Agreement each dated December 31, 2010
(25)10.76Consent of Schumacher & Associates dated March 7, 2011
(26)10.77Marketing Agreement with Bill Fishkin dated April 1, 2011
(26)10.78Agreement to Convert Debt with Donaldson Consulting Services, Inc. dated May 31, 2011
(27)10.79Term Sheet with LeRoy Wilkes dated July 14, 2011
(28)10.80Accredited Members Agreement dated August 31, 2011
(29)10.81Promissory Note – John D. Gibbs dated October 26, 2011
(29)10.82Promissory Note – John D. Gibbs dated November 15, 2011
(30)10.83Marketing Agreement with Bill Fishkin dated December 1, 2011
(31)10.84Advisor Agreement with GVC Capital, LLC dated January 30, 2012
(32)10.85Promissory Note – John D. Gibbs dated March 18, 2012
(33)10.86Promissory Note – John D. Gibbs dated February 2, 2012
(34)10.87Promissory Note – John D. Gibbs dated April 27, 2012
(35)10.88Agreement to Convert Debt – John D. Gibbs
(36)10.89Promissory Note – John D. Gibbs dated May 22, 2012
(36)10.90Assignment of Right to Purchase Property
(37)10.91Agreement to Convert Debt – John Donaldson
(38)10.92Credit Agreement – John D. Gibbs
(38)10.93Form of Credit Note
(39)10.94Amendment No. 1 to Langtry Lease Agreement
(40)10.95Allonge and Modification Agreement with John D. Gibbs
(41)10.96Amendment No. 2 to Langtry Lease Agreement
(42)10.97Second Allonge and Modification Agreement with John D. Gibbs
(43)10.98Amendment No. 3 to Langtry Lease Agreement
(44)10.99Third Allonge and Modification Agreement with John D. Gibbs
(45)10.100Promissory Note – Clifford L. Neuman dated April 1, 2015
(46)10.101Lease/Purchase Option Agreement
(47)10.102Fifth Allonge and Modification Agreement with John D. Gibbs
(48)10.103Promissory Note – John Power dated September 12, 2016
(49)10.104Agreement to Convert Debt dated May 15, 2018
(50)10.105Eighth Allonge and Modification Agreement with John D. Gibbs
(52)10.106Tenth Allonge and Modification Agreement with John D. Gibbs
(53)10.107Eleventh Allonge and Modification Agreement with John D. Gibbs
(54)10.108Amendment No. 1 to Lease with an Option to Purchase dated March 10, 2016

49

(55)10.109NSR Agreement
(56)10.110Termination Agreement
(57)10.111Twelfth Allonge and Modification Agreement with John Gibbs
(58)10.112Letter of Intent dated August 21, 2020
(59)10.113Thirteenth Allonge and Modification Agreement with John Gibbs
(60)10.114Letter of Intent
(61)10.115Option Agreement
(62)10.116Option Agreement - Stronghold
(63)10.117Agreement to Convert Debt -Power
(64)10.118Agreement to Convert Debt -Gibbs
(65)10.119Agreement to Convert Debt - Power
(66)10.120Certificate of Amendment to Certificate of Amended and Restated Certificate of Incorporation
(67)10.121Consulting Agreement - Minnick
(68)10.122First Amendment to Option Agreement
(69)10.123Share Purchase Agreement dated December 27, 2021
(70)10.124Consent of Smythe LLP
(2)14Code of Ethics
(1)21.0List of Subsidiaries
#31.1Certification of the Chief Executive Officer required by Section 13a-14(a) of the Exchange Act.
#31.2Certification of the Chief Financial Officer required by Section 13a-14(a) of the Exchange Act.
#32.1Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
#32.2Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 101.INSInline XBRL Instance Document##
 101.SCHInline XBRL Schema Document##
 101.CALInline XBRL Calculation Linkbase Document##
 101.LABInline XBRL Label Linkbase Document##
 101.PREInline XBRL Presentation Linkbase Document##
 101.DEFInline XBRL Definition Linkbase Document##
 104Cover Page Interactive Data File (formatted in iXBRL, and included in exhibit 101).

__________________ 

101.INS

(1)

XBRL Instance Document##

101.SCH

XBRL Schema Document##

101.CAL

XBRL Calculation Linkbase Document##

101.LAB

XBRL Label Linkbase Document##

101.PRE

XBRL Presentation Linkbase Document##

101.DEF

XBRL Definition Linkbase Document##

(1)

Incorporated by reference from the Company's Registration Statement on Form SB-2, SEC File No. 121351 as declared effective by the Commission on February 14, 2006.

(2)

(2)

Incorporated by reference from the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2006, and filed with the Commission on April 24, 2007.

(3)

(3)

Incorporated by reference from the Company’s Current Report on Form 8-K dated September 4, 2007 and filed with the Commission on September 14, 2007.

(4)

(4)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 4, 2007 and filed with the Commission on December 6, 2007.

(5)

(5)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 11, 2007 and filed with the Commission on December 18, 2007.

(6)

(6)

Incorporated by reference from the Company’s Current Report on Form 8-K dated March 12, 2008 and filed with the Commission on March14,March 14, 2008.

(7)

(7)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 31, 2008 and filed with the Commission on January 6, 2009.

(8)

(8)

Incorporated by reference from the Company’s Current Report on Form 8-K dated February 11, 2009 and filed with the Commission on February 13, 2009.

(9)

(9)

Incorporated by reference from the Company’s Current Report on Form 8-K dated March 2, 2009 and filed with the Commission on March 5, 2009.

50

 

(10)

(10)

Incorporated by reference from the Company’s Annual Report on Form 10-K dated December 31, 2009 and filed with the Commission on April 14, 2009.

(11)

(11)

Incorporated by reference from the Company’s Current Report on Form 8-K dated April 28, 2009 and filed with the Commission on May 6, 2009.

(12)

(12)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 15, 2009 and filed with the Commission on June 19, 2009.

(13)

(13)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 26, 2009 and filed with the Commission on July 2, 2009.

(14)

(14)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 14, 2009 and filed with the Commission on December 18, 2009.

(15)

(15)

Incorporated by reference from the Company’s Current Report on Form 8-K dated January 5, 2010 and filed with the Commission on January 7, 2010.

(16)

(16)

Incorporated by reference from the Company’s Current Report on Form 8-K dated March 11, 2010 and filed with the Commission on March 15, 2010.

(17)

(17)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 25, 2010 and filed with the Commission on June 25, 2010.

(18)

(18)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 30, 2010 and filed with the Commission on July 28, 2010.

(19)

(19)

Incorporated by reference from the Company’s Current Report on Form 8-K dated August 3, 2010 and filed with the Commission on August 4, 2010.

(20)

(20)

Incorporated by reference from the Company’s Current Report on Form 8-K dated August 20, 2010 and filed with the Commission on August 23, 2010.

(21)

(21)

Incorporated by reference from the Company’s Current Report on Form 8-K dated August 20, 2010 and filed with the Commission on August 30, 2010.

(22)

(22)

Incorporated by reference from the Company’s Current Report on Form 8-K/A dated August 20, 2010 and filed with the Commission on November 1, 2010.

(23)

(23)

Incorporated by reference from the Company’s Current Report on Form 8-K dated November 15, 2010 and filed with the Commission on November 17, 2010.

(24)

(24)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 31,  2010 and filed with the Commission on January 6, 2011

(25)

(25)

Incorporated by reference from the Company’s Current Report on Form 8-K dated March 2, 2011 and filed with the Commission on March 7, 2011.

(26)

(26)

Incorporated by reference from the Company’s Current Report on Form 8-K dated April 1, 2011 and filed with the Commission on June 2, 2011.

(27)

(27)

Incorporated by reference from the Company’s Current Report on Form 8-K dated August 1, 2011 and filed with the Commission on August 3, 2011.

(28)

(28)

Incorporated by reference from the Company’s Current Report on Form 8-K dated August 22, 2011 and filed with the Commission on September 9, 2011.

(29)

(29)

Incorporated by reference from the Company’s Current Report on Form 8-K dated October 26, 2011 and filed with the Commission on January 4, 2012.

(30)

(30)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 15, 2011 and filed with the Commission on January 5, 2012.

(31)

(31)

Incorporated by reference from the Company’s Current Report on Form 8-K dated February 2, 2012 and filed with the Commission on February 9, 2012.

(32)

(32)

Incorporated by reference from the Company’s Current Report on Form 8-K dated March 18, 2012 and filed with the Commission on March 23, 2012.

(33)

(33)

Incorporated by reference from the Company’s Current Report on Form 8-K8-K/A dated February 2, 2012 and filed with the Commission on March 26, 2012.

(34)

(34)

Incorporated by reference from the Company’s Current Report on Form 8-K dated April 27, 2012 and filed with the Commission on May 2, 2012.

(35)

(35)

Incorporated by reference from the Company’s Current Report on Form 8-K dated May 10, 2012 and filed with the Commission on May 16, 2012.

(36)

(36)

Incorporated by reference from the Company’s Current Report on Form 8-K dated May 22, 2012 and filed with the Commission on May 25, 2012

(37)

(37)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 16, 2012 and filed with the Commission on June 19, 2012.

(38)

(38)

Incorporated by reference from the Company’s Current Report on Form 8-K dated July 18, 2012 and filed with the Commission on July 19, 2012.

(39)

(39)

Incorporated by reference from the Company’s Current Report on Form 8-K dated November 28, 2012 and filed with the Commission on November 29, 2012.

(40)

(40)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 5, 2013 and filed with the Commission on June 6, 2013.

(41)

(41)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 19, 2013 and filed with the Commission on December 23, 2013.

(42)

(42)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 31, 2013 and filed with the Commission on January 2, 2014.

(43)

(43)

Incorporated by reference from the Company’s Current Report on Form 8-K dated January 21, 2015 and filed with the Commission on January 21, 2015.

(44)

(44)

Incorporated by reference from the Company’s Current Report on Form 8-K dated December 31, 2014 and filed with the Commission on March 31, 2015.

(45)

(45)

Incorporated by reference from the Company’s Current Report on Form 8-K dated May 5, 2015 and filed with the Commission on May 6, 2015.

(46)

(46)

Incorporated by reference from the Company’s Current Report on Form 8-K dated

March 10, 2016 and filed with the Commission on March 15, 2016.

(47), (48)

Incorporated by reference from the Company’s Current Report on Form 8-K dated

September 12, 2016 and filed with the Commission on October 14, 2016.

(49)

Incorporated by reference from the Company’s Current Report on Form 8-K dated June 27, 2018 and filed with the Commission on June 28, 2018.

#

(50)

Filed herewith

Incorporated by reference from the Company’s Current Report on Form 8-K dated July 31, 2018 and filed with the Commission on August 6, 2018.

##Furnished, not filed. 

 

 


51

(51)Incorporated by reference from the Company’s Current Report on Form 8-K dated March 1, 2007 and filed with the Commission on March 8, 2007
(52)Incorporated by reference from the Company’s Current Report on Form 8-K dated November 5, 2019 and filed with the Commission on November 6, 2019.
(53), (54)Incorporated by reference from the Company’s Current Report on Form 8-K dated February 21, 2020 and filed with the Commission on February 24, 2020.
(55), (56)Incorporated by reference from the Company’s Current Report on Form 8-K dated April 28, 2020 and filed with the Commission on April 29, 2020.
(57), (58)Incorporated by reference from the Company’s Current Report on Form 8-K dated August 3, 2020 and filed with the Commission on August 31, 2020.
(59)Incorporated by reference from the Company’s Current Report on Form 8-K dated October 19, 2020 and filed with the Commission on October 19, 2020.
(60)Incorporated by reference from the Company’s Current Report on Form 8-K dated October 22, 2020 and filed with the Commission on October 28, 2020.
(61)Incorporated by reference from the Company’s Current Report on Form 8-K dated December 15, 2020 and filed with the Commission on December 21, 2020.
(62), (63), (64), (65)Incorporated by reference from the Company’s Current Report on Form 8-K dated December 21, 2020 and filed with the Commission on January 5, 2021.
(66)Incorporated by reference from the Company’s Current Report on Form 8-K dated January 21, 2021 and filed with the Commission on January 27, 2021.
(67)Incorporated by reference from the Company’s Current Report on Form 8-K dated May 6, 2021 and filed with the Commission on May 12, 2021.
(68)Incorporated by reference from the Company’s Current Report on Form 8-K dated November 10, 2021 and filed with the Commission on November 15, 2021.
(69)Incorporated by reference from the Company’s Current Report on Form 8-K dated December 27, 2021 and filed with the Commission on January 6, 2022.
(70)Incorporated by reference from the Company’s Current Report on Amended Form 8-K/A dated December 27, 2021 and filed with the Commission on March 14, 2022.
#Filed herewith
##Furnished, not filed.

52

 

ATHENA SILVERGOLD CORPORATION

(Formerly Athena Silver Corporation)

TABLE OF CONTENTS

 

Page

Report of Independent Registered Public Accounting Firm

MaloneBailey, LLP, PCAOB ID 206

F-1

F-2

ConsolidatedBalance SheetSheetss

F-2

F-3

ConsolidatedStatements of OperationsOperations

F-3

F-4

Consolidated Statements of Stockholders’ Equity

F-5
Consolidated Statements of Cash Flows

F-4

F-6

Consolidated Statements of Stockholders’ Equity (Deficit)

F-5

Notes to Consolidated Financial Statements

F-6

F-7

 

 

 


 

 

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Shareholders and Board of Directors and Stockholders of

Athena SilverGold Corporation

Vacaville, California

Opinion on the Financial Statements

 

We have audited the accompanying consolidated balance sheets of Athena SilverGold Corporation and its subsidiary (collectively, the “Company”) as of December 31, 20162022 and 2015,2021, and the related consolidated statements of operations, stockholders’ equity, (deficit) and cash flows for the years then ended. ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Going Concern Matter

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).PCAOB. Those standards require that we plan and perform anthe audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included considerationAs part of our audits we are required to obtain an understanding of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’sCompany's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes

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

 

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Athena Silver Corporation and its subsidiary as of December 31, 2016 and 2015 and the consolidated results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has not generated any revenue and further losses are anticipated. These conditions raise significant doubt about the Company’s ability to continue as a going concern. Management’s plans in this regard are described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/s/ MaloneBailey, LLP

www.malonebailey.com

We have served as the Company's auditor since 2011.

Houston, Texas

March 29, 201715, 2023


 

  

 

ATHENA SILVER CORPORATION

CONSOLIDATED BALANCE SHEETS

 

 

December 31, 2016

 

December 31, 2015

 

 

 

 

ASSETS

 

 

 

Current Assets

 

 

 

Cash and cash equivalents

$ 1,582

 

$ 1,055

 

 

 

 

Total current assets

1,582

 

1,055

 

 

 

 

Mineral rights and properties - unproven

2,068,788

 

1,985,342

 

 

 

 

Total assets

$ 2,070,370

 

$ 1,986,397

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

 

 

 

Current liabilities:

 

 

 

Accounts payable

$ 16,346

 

$ 28,453

Accrued liabilities

37,000

 

43,167

Accrued interest

5,569

 

2,343

Accrued interest - related parties

258,040

 

176,733

Deed amendment liability - short-term portion

10,000

 

10,000

Derivative liabilities

63,110

 

8,670

Convertible note payable

51,270

 

51,270

Note payable - related party

39,665

 

-

Convertible credit facility - related party

1,715,620

 

1,500,000

 

 

 

 

Total current liabilities

2,196,620

 

1,820,636

 

Deed amendment liability

120,000

 

130,000

 

Total liabilities

2,316,620

 

1,950,636

 

Commitments and contingencies

 

 

 

 

Stockholders' equity (deficit):

 

 

 

Preferred stock, $.0001 par value, 5,000,000 shares authorized, none outstanding

0

 

0

 

 

 

 

Common stock - $0.0001 par value; 100,000,000 shares authorized, 36,202,320 issued and outstanding

3,620

 

3,620

Additional paid-in capital

6,602,028

 

6,602,028

Accumulated deficit

(6,851,898)

 

(6,569,887)

Total stockholders' equity (deficit)

(246,250)

 

35,761

 

Total liabilities and stockholders' equity (deficit)

$ 2,070,370

 

$ 1,986,397

F-2

ATHENA GOLD CORPORATION

CONSOLIDATED BALANCE SHEETS

         
Assets 12/31/22  12/31/21 
       
Current assets        
Cash $15,075  $72,822 
Prepaid expenses  32,200   51,166 
Total current assets  47,275   123,988 
         
Other assets        
Mineral Rights  6,196,114   6,000,000 
Total other assets  6,196,114   6,000,000 
         
Total assets $6,243,389  $6,123,988 
         
Liabilities and Stockholders' Equity        
         
Current liabilities        
Accounts payable $143,939  $50,373 
Accounts payable – related party  30,006    
Notes payable  106,210    
Total current liabilities  280,155   50,373 
         
Long term liabilities        
Warrant liability  999,820   1,024,208 
Total long term liabilities  999,820   1,024,208 
         
Total liabilities  1,279,975   1,074,581 
         
Stockholders' equity        
Preferred stock, $.0001 par value, 5,000,000 shares authorized, none outstanding      
Common stock - $0.0001 par value; 250,000,000 shares authorized, 136,091,400 and 119,858,700 issued and outstanding  13,609   11,986 
Additional paid in capital  16,652,603   16,056,561 
Accumulated deficit  (11,702,798)  (11,019,140)
         
Total stockholders' equity  4,963,414   5,049,407 
         
Total liabilities and stockholders' equity $6,243,389  $6,123,988 

See accompanying notes to the financial statements.

F-3

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

         
  Twelve Months Ended 
   12/31/22   12/31/21 
         
Operating expenses        
Exploration, evaluation and project expenses $617,262  $137,983 
General and administrative expenses  682,512   614,478 
Total operating expenses  1,299,774   752,461 
         
Net operating loss  (1,299,774)  (752,461)
         
Interest expense  (463)  (12,192)
Gain on extinguishment of debt     3,880 
Revaluation of warrant liability  616,579   (269,482)
Net loss $(683,658) $(1,030,255)
         
Weighted average common shares outstanding – basic and diluted  127,608,629   65,902,198 
         
Loss per common share – basic and diluted $(0.01) $(0.02)

See accompanying notes to the financial statements.

 

 

 

 


ATHENA SILVER CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

Years Ended December 31,

 

 

 

2016

 

2015

 

Operating expenses:

 

 

 

 

 

Exploration costs

 

$ 9,489

 

$ 93,661

 

General and administrative expenses

 

132,900

 

133,299

 

 

 

Total operating expenses

 

142,389

 

226,960

 

 

 

 

 

 

 

Operating loss

 

(142,389)

 

(226,960)

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest expense

 

(85,182)

 

(102,859)

 

Change in fair value of derivative liabilities

 

(54,440)

 

30,360

 

Total other income (expense)

 

(139,622)

 

(72,499)

 

Net loss

 

$ (282,011)

 

$ (299,459)

 

 

 

 

 

 

 

Basic and diluted net loss per common share

 

$ (0.01)

 

$ (0.01)

 

 

 

 

 

 

 

Basic and diluted weighted-average common shares outstanding

 

36,202,320

 

36,186,978

 

 

 

 


 

ATHENA SILVER CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

Year Ended December 31,

 

 

2016

 

2015

 

Cash flows from operating activities:

 

 

 

 

Net loss

$ (282,011)

 

$ (299,459)

 

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

Amortization of debt discount

-

 

31,710

 

Change in fair value of derivative liabilities

54,440

 

(30,360)

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts payable

(6,107)

 

4,997

 

Accrued interest - related parties

81,307

 

68,807

 

Accrued liabilities and other liabilities

28,726

 

13,843

 

 

 

 

 

 

Net cash used in operating activities

(123,645)

 

(210,462)

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Acquisition of mineral rights

(121,113)

 

(50,605)

 

 

 

 

 

 

Net cash used in investing activities

(121,113)

 

(50,605)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Proceeds on advances from related parties

7,250

 

6,710

 

Payments on advances from related parties

(7,250)

 

(6,710)

 

Borrowings from credit facility and notes payable - related parties

260,620

 

254,000

 

Payments on note payable - related party

(5,335)

 

-

 

Payment on deed amendment liability

(10,000)

 

-

 

 

 

 

 

 

Net cash provided by financing activities

245,285

 

254,000

 

 

 

 

 

 

Net increase (decrease) in cash

527

 

(7,067)

 

Cash at beginning of period

1,055

 

8,122

 

 

 

 

 

 

Cash at end of period

$ 1,582

 

$ 1,055

 

 

 

 

 

 

Supplemental disclosure of cash flow information

 

 

 

 

Cash paid for interest

$ 649

 

$ -

 

Cash paid for income taxes

$ -

 

$ -

 

 

 

 

 

 

Supplemental disclosure of non-cash investing and financing activities:

 

 

 

 

Increase in accrued liabilities applicable to mineral rights

$ -

 

$ 13,917

 

Conversion of accounts payable to convertible note payable

$ -

 

$ 51,270

 

Common stock issued for mineral rights

$ -

 

$ 22,000

 

Deed amendment liabilities

$ -

 

$ 140,000

 

 

 

 


ATHENA SILVER CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

 

 

 

 

 

 

Additional

 

 

 

 

 

 

Common Stock

 

Paid-in

 

Accumulated

 

 

 

 

Shares

 

Amount

 

Capital

 

Deficit

 

Total

Balance, December 31, 2014

 

36,002,320

 

$ 3,600

 

$ 6,580,048

 

$ (6,270,428)

 

$ 313,220

Shares issued under Amendment #3 of Langtry lease

200,000

 

20

 

21,980

 

-

 

22,000

Net loss

 

-

 

-

 

-

 

(299,459)

 

(299,459)

Balance, December 31, 2015

 

36,202,320

 

3,620

 

6,602,028

 

(6,569,887)

 

35,761

Net loss

 

-

 

-

 

-

 

(282,011)

 

(282,011)

Balance, December 31, 2016

 

36,202,320

 

$ 3,620

 

$ 6,602,028

 

$ (6,851,898)

 

$ (246,250)

 

 

 


 

ATHENA SILVER CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

 

Note 1 – Organization, Basis of Presentation, Liquidity and Going Concern:

F-4

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

 

 

                    
        Additional       
  Common Stock  Paid In  Accumulated    
  Shares  Amount  Capital  Deficit  Total 
                
December 31, 2020 54,887,876  $5,489  $9,897,700  $(9,988,885) $(85,696)
Conversion of management fees 2,144,444   214   96,286      96,500 
Stock based compensation       158,389      158,389 
Private placement 14,358,700   1,436   740,939      742,375 
Warrant liability       (754,726)     (754,726)
Common stock issued for mineral property 45,000,000   4,500   5,845,500      5,850,000 
Common stock issued for debt and accrued interest 3,467,680   347   72,473      72,820 
Net loss          (1,030,255)  (1,030,255)
December 31, 2021 119,858,700  $11,986  $16,056,561  $(11,019,140) $5,049,407 
                    
                    
December 31, 2021 119,858,700  $11,986  $16,056,561  $(11,019,140) $5,049,407 
Stock based compensation       197,116      197,116 
Shares issued for services 675,000   67   33,683      33,750 
Private placement 15,057,700   1,506   922,484      923,990 
Warrant liability       (592,191)     (592,191)
Common stock issued for mineral property 500,000   50   34,950      35,000 
Net loss          (683,658)  (683,658)
December 31, 2022 136,091,400  $13,609  $16,652,603  $(11,702,798) $4,963,414 

See accompanying notes to the financial statements.

F-5

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

         
  Twelve Months Ended 
   12/31/22   12/31/21 
         
Cash flows from operating activities        
Net loss $(683,658) $(1,030,255)
Adjustments to reconcile net loss to net cash used in operating activities        
Amortization of debt discount     7,324 
Revaluation of warrant liability  (616,579)  269,482 
Shares issued for services  33,750    
Share based compensation  197,116   158,389 
Gain on forgiveness of debt     (3,880)
Change in operating assets and liabilities:        
Prepaid expense  18,966   (51,166)
Accounts payable  93,566   (10,776)
Accounts payable – related party  30,006    
Other liabilities     4,241 
Net cash used in operating activities  (926,833)  (656,641)
         
Cash flows from investing activities        
Purchase of mineral properties  (29,214)   
Net cash used in investing activities  (29,214)   
         
Cash flows from financing activities        
Proceeds from private placement of stock  822,890   742,375 
Proceeds from related parties  101,100   12,012 
Payments to related parties     (33,910)
Payments on notes payable  (25,690)   
Net cash provided by financing activities  898,300   720,477 
         
Net increase in cash  (57,747)  63,836 
         
Cash, beginning of period  72,822   8,986 
         
Cash, end of period $15,075  $72,822 
         
Supplemental disclosure of cash flow information        
Cash paid for interest $  $627 
Cash paid for income taxes $  $ 
         
Noncash investing and financing activities        
Stock issued to payoff note payable $101,100  $51,270 
Common stock issued for mineral properties $35,000  $5,850,000 
Note payable for mineral property $131,900  $ 
Conversion of management fee payable $  $96,500 
Warrant liability $592,191  $754,726 
Stock issued for accrued interest $  $21,550 

See accompanying notes to the financial statements.

F-6

ATHENA GOLD CORPORATION

NOTES TO FINANCIAL STATEMENTS

Note 1 – Nature of Business and Summary of Significant Accounting Policies

Nature of Operations

 

Athena SilverGold Corporation (“we,” “our,” “us,” or “Athena”) is engaged in the acquisition and exploration of mineral resources. We were incorporated in Delaware on December 23, 2003 and began our mining operations in 2010.

 

In December 2009, we formed and organized a new wholly-owned subsidiary, Athena Minerals, Inc. (“Athena Minerals”) which owns and operates our mining interests. Sinceinterests and property in California. On December 31, 2020 we sold the subsidiary to Mr. John Gibbs, a related party, in a non-cash exchange.

The Company’s properties do not have any reserves. The Company plans to conduct exploration programs on these properties with the objective of ascertaining whether any of its formation, we have acquired various properties and rights and are currently determining whether those rights and properties could sustain profitable mining operations. We have not presently determined whether our mineral properties contain mineral reserveseconomic concentrations of precious and base metals that are economically recoverable.prospective for mining.

Basis of Presentation

 

Our primary focus going forward will be to continue our evaluation of our properties, andWe prepared these financial statements in accordance with accounting principles generally accepted in the possible acquisition of additional mineral rights and additional exploration, development and permitting activities. Our mineral lease payments, permitting applications and exploration and development efforts will require additional capital. Further information regarding our mining properties and rights are discussed below in Note 3 – Mineral Rights and Properties.

United States (“GAAP”).

 

Foreign Currency Translation

The Company is exposed to currency risk on transactions and balances in currencies other than the functional currency. The Company has not entered any contracts to manage foreign exchange risk.

The functional currency of the Company is the US dollar; therefore, the Company is exposed to currency risk from financial assets and liabilities denominated in Canadian dollars.

Recent Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Liquidity and Going Concern

 

Our consolidated financial statements have been prepared on a going concern basis, which assumes that we will be able to meet our obligations and continue our operations during the next fiscal year. Asset realization values may be significantly different from carrying values as shown in our consolidated financial statements and do not give effect to adjustments that would be necessary to the carrying values of assets and liabilities should we be unable to continue as a going concern.

  

At December 31, 2016,2022, we had not yet achieved profitable operations and we have accumulated losses of $6,851,898approximately $11,700,000 since our inception. We expect to incur further losses in the development of our business, all of which castsraise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate future profits and/or to obtain the necessary financing to meet our obligations arising from normal business operations when they come due. Effective October 13, 2016, we amended our credit agreement with Mr. John Gibbs, a related party, to increase the borrowing limit under the line of credit to $1,750,000. In addition to the expansion of the credit line, the amendment also extended the maturity date of the credit line to December 31, 2017.

Additionally, on September 12, 2016 we executed a promissory note in favor of Mr. John Power, the Company’s President and Chief Executive Officer in the amount of $45,000, the proceeds of which were primarily used for working capital.

We anticipate that additional funding will be in the form of additional loans from officers, directors or significant shareholders, or equity financing from the sale of our common stock. Currently, there are no arrangements in place for additional equity funding or new loans.

 

 

 


F-7

Note 2 - Summary of Significant Accounting Policies

 

 

Basis of Presentation and Principles of Consolidation

Our consolidated financial statements include our accounts and the accounts of our wholly-owned subsidiary, Athena Minerals, Inc. All intercompany transactions and balances have been eliminated. Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Reclassifications

Certain reclassifications may have been made to our prior year’s consolidated financial statements to conform to our current year presentation. These reclassifications had no effect on our previously reported results of operations or accumulated deficit.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of expenses during the periods presented.

We make our estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available.

We believe that our significant estimates, assumptions and judgments are reasonable, based upon information available at the time they were made. Actual results could differ from these estimates, making it possible that a change in these estimates could occur in the near term.

Fair Value of Financial Instruments

We value our financial assets and liabilities using fair value measurements. Our financial instruments primarily consist of cash and cash equivalents, accounts payable, accrued liabilities, amounts due to related parties and notes payable to related parties. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The carrying amounts of cash and cash equivalents, accounts payable, accrued liabilities, notes payable to related parties and other amounts due to related parties approximate fair value because of the short-term nature of these financial instruments.

Concentrations of Credit Risk

Our financial instruments which potentially subject us to credit risk are our cash and cash equivalents. We maintain our cash and cash equivalents at reputable financial institutions and currently, we are not exposed to significant credit risk.

Cash and Cash Equivalents

 

We consider all amounts on deposit with financial institutions and highly liquid investments with an original maturity of three months or less to be cash equivalents.

 

Mineral Rights - Unproven

 

We have determined that our mining rights meet the definition of mineral rights, as defined by accounting standards, and are tangible assets. As a result, our direct costs to acquire or lease mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with: leasing or acquiring patented and unpatented mining claims; leasing mining rights including lease signature bonuses, lease rental payments and advance minimum royalty payments; and options to purchase or lease mineral properties.

 

If we establish proven and probable reserves for a mineral property and establish that the mineral property can be economically developed, mineral rights will be amortized over the estimated useful life of the property following the commencement of commercial production or expensed if it is determined that the mineral property has no future economic value or if the property is sold or abandoned. For mineral rights in which proven and probable reserves have not yet been established, we assess the carrying values for impairment at the end of each reporting period and whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

 

The net carrying value of our mineral rights represents the fair value at the time the mineral rights were acquired less accumulated depletion and any impairment losses. Proven and probable reserves have not been established for mineral rights as of December 31, 2016. No impairment loss was recognized during the years ended December 31, 2016 and 2015, and mineral rights are net of $0 of impairment losses as of December 31, 2016.

2022.

 

Impairment of Long-lived Assets

 

We continually monitor events and changes in circumstances that could indicate that our carrying amounts of long-lived assets, including mineral rights, may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through their undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of these assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets.

 

Notes Payable and Credit Facility– Related Parties

Notes payable and the credit facility payable to related parties are classified as current liabilities as the note holders are control persons and have the ability to control the repayment dates of the notes.

Exploration Costs

 

Mineral exploration costs are expensed as incurred. When it has been determined that it is economically feasible to extract minerals and the permitting process has been initiated, exploration costs incurred to further delineate and develop the property are considered pre-commercial production costs and will be capitalized and included as mine development costs in our consolidated balance sheets.

 

Stock-Based Compensation

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). This ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

The estimated fair value of each stock option as of the date of grant was calculated using the Black-Scholes pricing model. The Company estimates the volatility of its common stock at the date of grant based on Company stock price history. The Company determines the expected life based on the simplified method given that its own historical share option exercise experience does not provide a reasonable basis for estimating expected term. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The shares of common stock subject to the stock-based compensation plan shall consist of unissued shares, treasury shares or previously issued shares held by any subsidiary of the Company, and such number of shares of common stock are reserved for such purpose.

F-8

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair value:

Level 1 - Valuation based on quoted market prices in active markets for identical assets and liabilities.

Level 2 - Valuation based on quoted market prices for similar assets and liabilities in active markets.

Level 3 - Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of what market participants would use as fair value.

The fair value of cash, receivables and accounts payable approximates their carrying values due to their short term to maturity. The warrant liabilities are measured using level 3 inputs (Note 4).

 

Share-based PaymentsIncome Taxes

 

Income taxes are accounted for under the asset and liability method in accordance with ASC 740, “Income Taxes”. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance to the extent that the recoverability of the asset is unlikely to be recognized.

The Company reports a liability, if any, for unrecognized tax benefits resulting from uncertain tax positions taken, or expected to be taken, in an income tax return. The Company has elected to classify interest and penalties related to unrecognized income tax benefits, if and when required, as part of income tax expense in the statement of operations. No liability has been recorded for uncertain income tax positions, or related interest or penalties as of December 31, 2022, and December 31, 2021.

Net Loss per Common Share

The Company incurred net losses during the twelve months ended December 31, 2022, and 2021. At December 31, 2022 and 2021, potentially dilutive shares of common stock representing shares issuable on conversions of debt, options and warrants totaling 29,915,560 and 11,623,510, respectively, have been excluded from diluted net loss per common share because the impact of such inclusion would be anti-dilutive.

F-9

Note 2 – Mineral Rights - Excelsior Springs

Effective December 27, 2021 (“Effective Date”), the Company simultaneously executed and consummated a definitive Share Purchase Agreement (the “SPA”) with Nubian Resources, Ltd. (“Nubian”). The SPA was the result of a previously disclosed Option Agreement with Nubian dated as of December 11, 2020, as amended by First Amendment to Option Agreement dated November 10, 2021 (the “Option”). While the Option granted the Company the right to acquire up to a 100% interest in the mining claims comprising the Excelsior Springs Prospect (the “Property”) located in Esmerelda County, Nevada, the Company and Nubian agreed to restructure the transaction so that the Company purchased 100% of the issued and outstanding shares of common stock of Nubian Resources USA, Ltd (“Nubian USA”), a wholly-owned subsidiary of Nubian which held the Property. By purchasing 100% of Nubian USA, the Company effectively acquired the remaining 90% interest in the Property through the issuance of 45,000,000 shares, the Company having previously acquired a 10% interest in the Property in December 2020 with the issuance of 5,000,000 shares. The 50 million shares issued to Nubian were issued as “restricted securities” under the Securities Act of 1933, as amended (“Securities Act”).

The mineral property was valued at the December 31, 2021, the closing date for the SPA with a stock price of $0.13, resulting in a fair value consideration of $5,850,000 for the 45,000,000 shares issued. The transaction does not constitute a business combination in accordance with ASC 805, which defines a business as an integrated set of activities and assets capable of being conducted and managed for the purposes of providing a return to investors or other participants and that a business consists of inputs and processes applied to those inputs that have the ability to contribute to the creation of outputs. Management has determined that the acquired assets do not contain processes sufficient to constitute a business in accordance with ASC 805. The transaction represents the acquisition of assets in exchange for the assumption of liabilities and the issuance of share-based payments.

On June 9, 2022, the Company entered into an Acquisition Agreement (the “Agreement”) to purchase an undivided 100% interest in the Fortunatus and Prout patented lode mining claims in Esmeralda County, Nevada $185,000. The Agreement was completed in July 2022 with the following terms:

·$25,000 will be settled in cash (Paid July 2022)
·$35,000 of the purchase price settled by the issuance of 500,000 shares of the Company’s common stock (Issued); and
·$125,000 will be settled by a loan, repayable by the Company in quarterly installments of $25,000, beginning November 13, 2022 (paid), and continuing until October 13, 2023, at which time the entire remaining unpaid principal balance will be payable. The balance due as of December 31, 2022 is $100,000.

Note 3 – Convertible Note Payable

Effective April 1, 2015, the Company executed a convertible promissory note (the “Note”) in the principal amount of $51,270 in favor of Clifford Neuman, the Company’s legal counsel, representing accrued and unpaid fees for past legal services. The Note was unsecured and accrues interest at the rate of 6% per annum, compounded quarterly, and is due on demand. The principal and accrued interest due under the Note may be converted, at the option of the holder, into shares of the Company’s common stock.

On April 24, 2020, the Company agreed to reduce the conversion price from $0.0735 per share to $0.0210 per share. All other terms of the Note remain unchanged, and therefore did not change the cash flows of the Note. The Company determined the transaction was considered an extinguishment because of the change in conversion price in which no gain or loss was recorded according to ASC 470-50. However, because the conversion price was reduced below the $0.03 market value on the date of the change, a beneficial conversion feature resulted from the price reduction in the amount of $21,973, which was accounted for as a discount to the debt and a corresponding increase in additional paid in capital. The debt discount is being amortized on a straight-line basis over one year to interest expense. A total of $7,324 was amortized to interest expense during the twelve months ended December 31, 2021

On November 30, 2021, the Company received a notice of conversion of the Note with a principal balance of $51,270 and a conversion price of $0.021. On December 3, 2021, a total of 2,441,476 were issued. An additional 1,026,204 shares were issued for $21,550 of accrued interest on the same Note, none in 2022.

F-10

Note 4 – Common Stock and Warrants

During August, September and October 2022, the Company completed the private placement of four tranches (August 12, 2022; August 31, 2022; September 14, 2022; October 28, 2022) in which we sold 8,807,700 units. Each unit was priced at C$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of C$0.12. The warrants expire 24 months from issue date. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 184,350 broker warrants were granted along with C$14,748 to brokers as a placement fee. We measurerealized total proceeds of C$689,868 net of offering costs. In June 2022, the Company executed a promissory note with John Gibbs for $26,100 at 6% that is payable on demand as part payment for mineral property in escrow. In September 2022, the Company issued 443,110 shares of common stock as a part of the private placement offering to settle $26,100 of notes payable and recognize compensation expense or professional services expense for all share-based payment awards made$463 of accrued interest to employees, directorsMr. Gibbs.

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and non-employee consultantsHedging, the warrants have a derivative liability value.

Tranche 1 – August 12, 2022:

The warrant liability had an initial value of $129,812 based on estimated3,247,500 warrants issued. As of December 31, 2022, the warrant liability was valued at $134,067, resulting in a loss on revaluation of warrant liability of $4,255 based on the following assumptions:

 Schedule of assumptions used      
Fair value assumptions – warrant liability: 8/12/22  12/31/22 
Risk free interest rate  3.25%   4.41% 
Expected term (years)  2.0   1.6 
Expected volatility  132%   128% 

Tranche 2 – August 31, 2022:

The warrant liability had an initial value of $139,255 based on 2,300,000 warrants issued. As of December 31, 2022, the warrant liability was valued at $95,351, resulting in a gain on revaluation of warrant liability of $43,904 based on the following assumptions:

 Schedule of assumptions used      
Fair value assumptions – warrant liability: 8/31/22  12/31/22 
Risk free interest rate  3.45%   4.41% 
Expected term (years)  2.0   1.7 
Expected volatility  132%   126% 

F-11

Tranche 3 – September 14, 2022:

The warrant liability had an initial value of $100,656 based on 2,760,200 warrants issued. As of December 31, 2022, the warrant liability was valued at $115,000, resulting in a loss on revaluation of warrant liability of $14,344 based on the following assumptions:

 Schedule of assumptions used      
Fair value assumptions – warrant liability: 9/14/22  12/31/22 
Risk free interest rate  3.78%   4.41% 
Expected term (years)  2.0   1.7 
Expected volatility  134%   125% 

Tranche 4 – October 28, 2022:

The warrant liability had an initial value of $18,630 based on 500,000 warrants issued. As of December 31, 2022, the warrant liability was valued at $21,266, resulting in a loss on revaluation of warrant liability of $2,636 based on the following assumptions:

 Schedule of assumptions used      
Fair value assumptions – warrant liability: 10/28/22  12/31/22 
Risk free interest rate  4.41%   4.41% 
Expected term (years)  2.0   1.8 
Expected volatility  135%   124% 

On June 9, 2022, the Company entered into an Acquisition Agreement (the “Agreement”) to purchase an undivided 100% interest in the Fortunatus and Prout patented lode mining claims in Esmeralda County, Nevada $185,000. The Agreement was completed in July 2022 with the following terms:

·$25,000 will be settled in cash (Paid July 2022)
·$35,000 of the purchase price settled by the issuance of 500,000 shares of the Company’s common stock (Issued); and
·$125,000 will be settled by a loan, repayable by the Company in quarterly installments of $25,000, beginning November 13, 2022 (paid), and continuing until October 13, 2023, at which time the entire remaining unpaid principal balance will be payable.

In April 2022 the Company completed a private placement in which we sold 6,250,000 units. Each unit was priced at C$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of C$0.15. The warrants expire April 13, 2025. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 70,000 broker warrants were granted to a Canadian broker as a placement fee. We realized total proceeds of $394,082 net of offering costs. During March 2022, the Company executed two promissory notes with John Gibbs for $50,000 and $25,000 at 6% that is payable on demand. In April 2022, the Company issued 1,181,250 shares out of 3,375,000 shares of common stock in April 2022 at C$.08 per share as a part of the private placement offering to settle $75,000 of notes payable to Mr. Gibbs.

F-12

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and Hedging, the warrants have a derivative liability value.

In April 2022, the warrant liability had an initial value of $203,838. As of December 31, 2022, the warrant liability was valued at $293,698, resulting in a loss on revaluation of warrant liability of $89,860 based on the following assumptions:

Schedule of assumptions used       
Fair value assumptions – warrant liability: 4/13/22  12/31/22 
Risk free interest rate  2.57%   4.41% 
Expected term (years)  3.0   2.3 
Expected volatility  184%   133% 

During the twelve months ended December 31, 2021, we sold 14,358,700 shares of common stock in private placements realizing proceeds of $742,375.

On September 30, 2021, the Company completed a private placement in which we sold 3,108,700 units. Each unit was priced at C$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of C$0.15. The warrants expire May 31, 2024. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 91,000 broker warrants were granted to a Canadian broker as a placement fee. We realized total proceeds of $190,552 net of offering costs.

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and Hedging, the warrants have a derivative liability value.

At December 31, 2021, the warrant liability was valued at $341,145. As of December 31, 2022, the warrant liability was valued at $115,122, resulting in a gain on revaluation of warrant liability of $226,023 based on the following assumptions:

 Schedule of assumptions used         
Fair value assumptions – warrant liability: 9/30/21  12/31/21  12/31/22 
Risk free interest rate  0.53%   0.97%   4.41% 
Expected term (years)  2.7   2.4   1.4 
Expected volatility  189%   191%   134% 

On May 25, 2021, the Company completed a private placement in which we sold 6,250,000 units. Each unit was priced at C$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of C$0.15. The warrants expire May 31, 2024. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 173,810 broker warrants were granted to a Canadian broker as a placement fee. We realized total proceeds of $401,823 net of offering costs.

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and Hedging, the warrants have a derivative liability value.

F-13

At December 31, 2021, the warrant liability was valued at $683,063. As of December 31, 2022, the warrant liability was valued at $225,316, resulting in a gain on revaluation of warrant liability of $457,747 based on the following assumptions:

Schedule of assumptions used          
Fair value assumptions – warrant liability: 5/25/21  12/31/21  12/31/22 
Risk free interest rate  0.30%   0.97%   4.41% 
Expected term (years)  3.0   2.4   1.4 
Expected volatility  180%   189%   132% 

Total outstanding warrants of 24,935,560 as of December 31, 2022, were as follows: 

 Schedule of outstanding warrants Warrants Issued  Total 
                             
Warrants issued  6,250,000   3,108,700   6,250,000   5,547,500   2,760,200   500,000   24,416,400 
Broker warrants issued (1)  173,810   91,000   70,000   104,250   80,100   0   519,160 
Issued date  May 21   Sep 21   Apr 22   Aug 22   Sep 22   Oct 22     
Expiration date  May 24   May 24   Apr 25   Aug 24   Sep 24   Oct 24     
Exercise price (Canadian $) $0.15  $0.15  $0.15  $0.12  $0.12  $0.12     
                             
Balance at December 31, 2020  0   0   0   0   0   0   0 
Exercised  0   0   0   0   0   0   0 
Issued  6,423,810   3,199,700   0   0   0   0   9,623,510 
Expired  0   0   0   0   0   0   0 
Balance at December 31, 2021  6,423,810   3,199,700   0   0   0   0   9,623,510 
Exercised  0   0   0   0   0   0   0 
Issued  0   0   6,320,000   5,651,750   2,840,300   500,000   15,312,050 
Expired  0   0   0   0   0   0   0 
Balance at December 31, 2022  6,423,810   3,199,700   6,320,000   5,651,750   2,840,300   500,000   24,935,560 

(1)Broker warrants expire 24 months from issue date

During the quarter ended March 31, 2021, we sold 5,000,000 shares of common stock in private placements to six individuals at a price of $0.03 per share, realizing total proceeds of $150,000. Of the 5,000,000 shares sold, 1,750,000 shares were issued on May 28, 2021.

On January 1, 2021 Mr. John Power, the Company’s CEO/CFO agreed to convert accrued management fees totaling $96,500. As a result, we issued 2,144,444 shares common stock at a price of $0.045 per share, none in 2022.

F-14

Note 5 – Share Based Compensation

On October 12, 2022, the Company granted 2,250,000 options pursuant to the terms of the Company’s Stock Option Plan. The options were issued to five individuals, the CEO, CFO, and three Directors of the Company. The Black Scholes option pricing model was used to estimate the aggregate fair values. value of the October 2022 options of $106,109 as stock-based compensation with the following inputs: 

 Share-based compensation assumptions    
OptionsExercise Price

Expected

Life

Volatility

Risk Free

Interest Rate

2,250,000$0.065.5 years161.7%4.1%

On August 24, 2022, the Company granted 730,000 options pursuant to the terms of the Company’s Stock Option Plan. The Black Scholes option pricing model was used to estimate the aggregate fair value of the August 2022 options of $43,456 as stock-based compensation with the following inputs: 

     
OptionsExercise Price

Expected

Life

Volatility

Risk Free

Interest Rate

730,000$0.065.5 years177.9%3.2%

On March 22, 2021, the Company issued a total of 2,000,000 non-statutory stock options to four individuals, three of whom are Directors of the Company, the other an independent technical consultant that is helping design our 2021 exploration programs at Excelsior Spring. Upon vesting, each option is exercisable to purchase one share of common stock at a price of $0.09 per share. The options vest 50% upon issuance, and 25% on each of the first and second anniversaries of the grant date.

We estimateestimated the fair value of stockthe options on the date of grant using the Black-Scholes-MertonBlack-Scholes option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the options. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected remaining life of the options. The total estimated fair value of the options utilized the following assumptions:

 

Share-based compensation assumptions
Expected volatility211%
Expected life3.4 years
Risk free interest rate0.31%

The calculations resulted in the total fair value of the options issued to be $190,202. We expense share-based compensation adjusted for estimated forfeitures, using the straight-line method over the vesting term of the award for our employees and directors and over the expected service term for our non-employee consultants. We estimate forfeitures atAs such, a stock-based compensation charges totaling of $47,551 and $128,389 have been charged during the time of granttwelve months ended December 31, 2022, and revise those estimates in subsequent periods if actual forfeitures differ from our estimates. Our excess tax benefits, if any, cannot be credited to stockholders’ equity until the deduction reduces cash taxes payable; accordingly, we realized no excess tax benefits during any of the periods presented in the accompanying consolidated financial statements.December 31, 2021, respectively.

 

 

 

Income Taxes

F-15

 

We account for income taxes through the use of the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and for income tax carry-forwards. A valuation allowance is recorded to the extent that we cannot conclude that realization of deferred tax assets is more likely than not. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.

We follow a two-step approach to recognizing and measuring tax benefits associated with uncertain tax positions taken or expected to be taken in a tax return. The first step is to determine if, based on the technical merits, it is more likely than not that the tax position will be sustained upon examination by a taxing authority, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement with a taxing authority. We recognize interest and penalties, if any, related to uncertain tax positions in our provision for income taxes in the consolidated statements of operations. To date, we have not recognized any tax benefits from uncertain tax positions.

Net Loss per Common Share

We compute basic net loss per common share by dividing our net loss attributable to common shareholders by our weighted-average number of common shares outstanding during the period. Computation of diluted net loss per common share is similar to our computation of basic net loss per common share except that the numerator is increased to exclude charges which would not have been incurred, and the denominator is increased to include the number of additional common shares that would have been outstanding (using the if-converted and treasury stock methods) if securities containing potentially dilutive common shares (stock options and convertible debt) had been converted to common shares, and if such assumed conversion is dilutive.

At December 31, 2016 and 2015, 2,503,094 and 2,460,807, respectively, potentially dilutive shares comprised of common stock purchase warrants, shares underlying outstanding stock options and shares issuable upon conversions of debt have been excluded from diluted net loss per common share because the impact of such inclusion would be anti-dilutive.

Recently Adopted Accounting Standards

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Note 3 – Mineral Rights and Properties

Our mineral rights and mineral properties consist of:

 

December 31, 2016

 

December 31, 2015

Mineral properties

$

185,290

 

$

156,707

Mineral rights – Langtry Project

 

1,883,498

 

 

1,828,635

Mineral rights and properties

$

2,068,788

 

$

1,985,342

Mineral Properties

On August 8, 2016, we purchased 33+/- acres of land (“Section 16 Property”) for $28,582, net of $18 of title fees, located in San Bernardino County, California. The property is located in the Calico Mining District in the SE ¼ of the SE ¼ of Section 16; T 10 North, R 1 East. The State of California patented this land to a private party in 1935 and reserved in favor of the State one-sixteenth of all coal, oil, gas and other mineral deposits contained in the land.

In 2014, we purchased 160 acres of land (“Castle Rock”), located in the eastern Calico Mining District, San Bernardino County, California. The parcel is the SE quarter of Section 25, Township 10 North, Range 1 East and is mostly surrounded by public lands. It was purchased for $21,023 in a property tax auction conducted on behalf of the County. The eastern part of the Calico Mining District is best known for industrial minerals and is not known to have any precious metal deposits.

In 2012, we purchased 661 acres of land (“Section 13 Property”) in fee simple for $135,685 cash, located in San Bernardino County, California, that was sold in a property tax auction conducted on behalf of the County. The parcel is all of Section 13 located in Township 7 North, Range 4 East, San Bernardino Base & Meridian.

The Section 13 property is near the Lava Beds Mining District and has evidence of historic mining. It is adjacent to both the Silver Cliffs and Silver Bell historic mines. The property is located in the same regional geologic area known as the Western Mojave Block that includes our flagship Langtry Project. The property is approximately 28 miles southeast of our Langtry Project.

Mineral Rights

In 2010, we entered into a 20 year Mining Lease with Option to Purchase (the “Langtry Lease” or the “Lease”) granting us the exclusive right to explore, develop and conduct mining operations on a group of 20 patented mining claims consisting of approximately 413 acres that comprise our Langtry Property. Effective November 28, 2012, December 19, 2013 and January 21, 2015, we executed Amendments No. 1, 2 and 3, respectively, to the Langtry Lease modifying certain terms.

Effective March 10, 2016, we executed and delivered a new Lease/Purchase Option (“Lease/Option”) covering our flagship Langtry Property located in the Calico Mining District, San Bernardino County, California. The Lease/Option also includes two unpatented mining claims in the Calico Mining District known as the Lilly #10 and Quad Deuce XIII (the “Langtry Unpatented Claims”), which we have previously owned and agreed to transfer to the Lessor subject to the Lease/Option. The new Lease/Option supersedes all prior agreements.

The following is a summary of the highlights of the new Lease/Option, which is qualified in its entirety by the provisions of the Lease/Option dated March 10, 2016:

The Lease/Option has a term of 20 years, and grants an exclusive right to explore, develop and purchase the Langtry property. Lease payments under the new agreement are a nominal $1 per year, payable in advance. This amount was paid in March 2016. The lease requires us to also maintain the option to purchase in good standing as described below. 

Option payments: in order to maintain the option to purchase, we are required to pay option payments (“Option Payments”) as follows: $40,000 year 1; the greater of $40,000 or the spot price of 2,500 ounces of silver in years 2 through 5; the greater of $50,000 or the spot price of 2,500 ounces of silver in years 6 through 10; the greater of $75,000 or the spot price of 3,750 ounces of silver in years 11 through 15; and the greater of $100,000 or the spot price of 5,000 ounces of silver in years 16 through 20. 50% of all Option Payments are credited against the purchase price should the Company exercise the purchase option. 

In Year 1, 50% of the annual option payment of $20,000 was paid on March 15, 2016. The remaining payment of $20,000 was paid on September 15, 2016. In subsequent years, the option payment shall be due March 15. 

Option Purchase Price: We have the option to purchase fee title to the Langtry Property for the full 20-year term of the Lease/Option. The purchase price is: 

oYears 1 through 3 (3-15-2016 to 3-15-2019): $5,000,000 

oYears 4 through 5 (3-15-2019 to 3-15-2021): the greater of $5,000,000 or the spot price of 250,000 troy ounces of silver, plus payment of the deferred rent of $130,000; 

oYears 6 through 10 (3-15-2021 to 3-15-26): the greater of $7,500,000 or the spot price of 375,000 troy ounces of silver, plus payment of the deferred rent of $130,000; 

oYears 11 through 20 (3-15-2026 to 3-15-2036): the greater of $10,000,000 or the spot price of 500,000 troy ounces of silver, plus payment of the deferred rent of $130,000. 

During the lease term, and provided the purchase option has not been exercised, the lessor is entitled to receive a 2% NSR on silver production and a 3% to 5% royalty on other mineral production and certain other revenue streams; 

After exercise of the purchase option, the lessor will not receive royalties on silver or other precious metals production but will receive a 5% royalty on barite production and other revenue streams. 

Deferred rent of $130,000 under the prior lease shall be payable upon exercise of the purchase option or upon Athena entering into a joint venture or other arrangement to develop the Langtry prospect. Accrued rent of $20,000 under the prior lease was due and paid September 15, 2016. 

If we are in breach of the Lease/Option, the Lessor will have the option to terminate the Lease by giving us 30 days written notice. The Lease also provides us with the right to terminate the Lease without penalty on March 15th of each year during the Lease term by giving the lessor 30 days written notice of termination on or before February 13th of each year. 

The Langtry Property is also subject to a net smelter royalty in favor of Mobil Exploration and Producing North America Inc. from the sale of concentrates, precipitates or metals produced from ores mined from the royalty acreage. The agreement dated April 30, 1987 granted a base net smelter royalty of 3% plus an additional incremental 2% royalty on net smelter proceeds from silver sales above $10.00 per troy ounce plus an additional incremental 2% royalty on net smelter proceeds from silver sales above $15.00 per troy ounce. 

On May 28, 2015 we executed an amendment to the deed underlying the Langtry Lease to cap at 2% the net smelter royalty that would be due to Mobil Exploration and Producing North America Inc. (“Mobil”) from any future sales of concentrates, precipitates or metals produced from ores mined from the royalty acreage. In consideration for the amendment, we agreed to pay an amendment fee of $150,000, with $10,000 due at the time of the agreement and the balance payable $10,000 each June 1st until paid in full. We paid the initial $10,000 upon execution of the amendment and $10,000 in June 2016. The next payment is due June 1, 2017. If we sell our interest in the Lease or enter into an agreement, joint venture or other agreement for the exploration and development of the Langtry Property, the amendment fee shall become due and payable immediately. 

During the term of the Lease, Athena Minerals has the exclusive right to develop and conduct mining operations on the Langtry Property. Future option payments and/or exploration and development of this property will require new equity and/or debt capital.

On September 28, 2015, at the request of the Company and its advisors, the San Bernardino County Land Use Services Department (the “Department”) issued and recorded a Certificate of Land Use Compliance for Vested Land Use in which the Department formally determined that the Langtry property had the legally established right for mineral resource development activity (the “Vested Right”). The Vested Right is subject to certain conditions set forth in the Certificate and runs with the Langtry property in perpetuity.

In August 2015 the Company acquired by deed conveyance 15 unpatented mining claims in the Calico Mining District in San Bernardino, California from a third party. The claims are contiguous to our existing unpatented and patented claims known as the Langtry Property. In consideration of the conveyance, the Company agreed to pay $10,000, payable in equal monthly installments of $1,000 beginning on September 1, 2015 which has been paid in full.

During the year ended December 31, 2016 we capitalized a total of $54,863 as mineral rights. This amount includes the $40,020 option and lease payments due under the 2016 Mining Lease/Option to Purchase as discussed above. In addition, we capitalized $8,333 of lease rental obligations due under the 2010 agreement and subsequent amendments, and $6,510 of payments to the bureau of Land Management to maintain our claims in good standing. As of December 31, 2016 all amounts due or accrued regarding our mineral rights had been paid, and all our claims remain in good standing.

During the year ended December 31, 2015 we capitalized a total of $226,522 of lease rental obligations and payments related to Amendment No. 3 of the Lease, the deed amendment with Mobil, and the acquisition of other unpatented mining claims, all as discussed above. The total amount capitalized includes the issuance of 200,000 shares of Athena common stock valued at $0.11 per share issued as consideration for modifications to the Lease.

All commitments and obligations under our prior 2010 Lease and our new 2016 Lease/Option to Purchase have been fulfilled to date. Future option payments and/or exploration and development of this property may require new equity and/or debt capital.

Note 4 - Fair Value of Financial Instruments

Financial assets and liabilities recorded at fair value in our consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:

Level 1— Quoted market prices in active markets for identical assets or liabilities at the measurement date.

Level 2— Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.

Level 3— Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.

A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Financial assets and liabilities measured at fair value on a recurring basis are summarized below:

 

 

Carrying Value at

 

Fair Value Measurement at December 31, 2016

 

 

 

December 31, 2016

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - Warrants

 

$

1,130

 

$

 

$

 

$

1,130

 

Derivative liability – Convertible note payable

 

$

61,980

 

$

 

$

 

$

61,980

 

 

 

Carrying Value at

 

Fair Value Measurement at December 31, 2015

 

 

 

December 31, 2015

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability - Warrants

 

$

530

 

$

 

$

 

$

530

 

Derivative liability – Convertible note payable

 

$

8,140

 

$

 

$

 

$

8,140

 

 

A summary of the stock options as of December 31, 2022, and changes induring the derivative liabilities is as follows:periods are presented below: 

Schedule of Stock Options Activity    
 

Number of

Options

Weighted

Average

Exercise

Price

Weighted

Average

Remaining

Contractual

Life

(Years)

Aggregate

Intrinsic

Value

Balance at December 31, 20200$0.000$0
Exercised0000
Issued2,000,0000.094.20
Canceled0000
Balance at December 31, 20212,000,0000.094.280,000
Exercised0000
Issued2,980,0000.0610.00
Canceled0000
Balance at December 31, 20224,980,0000.077.10
Options exercisable at December 31, 20224,480,0000.077.60

 

Balance, December 31, 2014

$ 7,320

Convertible note payable - value at inception

31,710

Total gains, (unrealized, realized) included in net loss

(30,360)

Balance, December 31, 2015

8,670

Total losses, (unrealized, realized) included in net loss

54,440

Balance, December 31, 2016

$ 63,110

The carrying valuesAlso, on March 22, 2021, the Company agreed to issue a total of cash and cash equivalents, accounts payable and accrued liabilities, approximate their fair value because of the short-term nature of these financial instruments.

Note 5 – Derivative Liabilities and Note Payable

Warrants:

Effective February 7, 2012, and pursuant to an Advisor Agreement with GVC Capital, LLC dated January 30, 2012, we sold and issued warrants exercisable to purchase an aggregate of 143,000 common shares at an exercise price of $0.25 per share at any time within five years of the date of their issuance in consideration of $100 cash and investor relation services with a fair value of $35,793. The warrants have anti-dilution provisions, including a provision for adjustments to the exercise price and to the number of warrant shares purchasable if we issue or sell common shares300,000 restricted stock units at a price less than the then current exercise price.

We determined that the warrants were not afforded equity classification because the warrants are not considered to be indexed to our own stock dueof $0.10 per share to the anti-dilution provision. Accordingly,independent technical consultant helping design our 2021 exploration programs at Excelsior Springs. However, the warrants are treated as a derivative liability and are carried at fair value. We estimate the fair value of these derivative warrants at each balance sheet date and the changes in fair value are recognized in earnings in our consolidated statements of operations under the caption “change in fair value of derivative liabilities” until such time as the derivative warrants are exercised or expire.

The change in fair value of our derivative warrant liability is as follows:

Balance, December 31, 2014

$ 7,320

Total gains, (unrealized, realized) included in net loss

(6,790)

Balance, December 31, 2015

530

Total losses, (unrealized, realized) included in net loss

600

Balance, December 31, 2016

$ 1,130

We estimate the fair value of our derivative warrants on the date of issuance and each subsequent balance sheet date using the Black-Scholes option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the warrants. Currently, we believe that the potential impact to the fair value of our derivative warrants attributable to the anti-dilution provision is insignificant and we will consider using a lattice model for purposes of valuation if and when the fair value of the anti-dilution provision becomes significant. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected remaining life of the derivative warrants.

The following table summarizes the assumptions used to value our derivative warrants at December 31, 2016:

Fair value assumptions – derivative warrants:

December 31, 2016

Risk free interest rate

0.51%

Expected term (years)

0.1

Expected volatility

269%

Expected dividends

0%

The following table summarizes the assumptions used to value our derivative warrants at December 31, 2015:

Fair value assumptions – derivative warrants:

December 31, 2015

Risk free interest rate

0.65%

Expected term (years)

1.1

Expected volatility

146%

Expected dividends

0%

Convertible Note Payable:

Effective April 1, 2015, the Company executed a convertible promissory note (the “Note”) in the principal amount of $51,270 in favor of Clifford Neuman, the Company’s legal counsel, representing accrued and unpaid fees for past legal services. The Note accrues interest at the rate of 6% per annum, compounded quarterly, and is due on demand. The principal and accrued interest due under the Note mayshares shall not be converted, at the option of the holder, into shares of the Company’s common stock at a conversion price of $0.0735 per share, which represented the market price of the Company’s common stock on the date the Note was made. The conversion price is subject to adjustment in the event the Company sells shares of common stock or common stock equivalent at a price below the conversion price.

The Note contains certain anti-dilution provisions that would reduce the conversion price should the Company issue common stock equivalents at a price less than the Note conversion price. Accordingly, the conversion features of the Note are considered a discount to the Note. However, since the Note is payable upon demand by the note holder, the value of the discount is considered interest expense at the time of its inception. The Note is evaluated quarterly, and upon any quarterly valuations in which the value of the conversion option changes we recognize a gain or loss due to a decrease or increase in the fair value of the derivative liability, respectively. At the inception of the Note, we recognized $31,710 of interest expense representing the amortization of the discount and the establishment of derivative liability.

The change in fair value of our derivative liability – convertible note payable is as follows:

Balance, December 31, 2014

$ 0

Convertible note payable - value at inception

31,710

Total gains, (unrealized, realized) included in net loss

(23,570)

Balance, December 31, 2015

8,140

Total losses, (unrealized, realized) included in net loss

53,840

Balance, December 31, 2016

$ 61,980

We estimate the fair value of this derivative at inception and at each balance sheet dateissued until such time the Noteindividual either provides a written request or his termination date, whichever is paid or converted using the Black-Scholes option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the Note. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected remaining life of the Note.

sooner. The following table summarizes the assumptions used to value the derivative Note discount at December 31, 2016:

Fair value assumptions – derivative:

December 31, 2016

Risk free interest rate

0.85%

Expected term (years)

1.0

Expected volatility

259%

Expected dividends

0%

The following table summarizes the assumptions used to value the derivative Note discount at December 31, 2015:

Fair value assumptions – derivative:

December 31, 2015

Risk free interest rate

0.65%

Expected term (years)

1.0

Expected volatility

195%

Expected dividends

0%

Accrued interest totaled $5,569 and $2,343 at December 31, 2016 and 2015, respectively, and is included in Accrued interest on the accompanying consolidated balance sheets.

Note 6 – Credit Agreement and Notes Payable – Related Parties

Convertible Credit Facility – Related Party

Effective July 18, 2012,shares shall have no voting rights until issued. As such, we entered into a Credit Agreement with Mr. Gibbs, a significant shareholder, providing us with an unsecured credit facility in the maximum amount of $1,000,000. The aggregate principal amount borrowed, together with interest at the rate of 5% per annum, was due in full on July 31, 2014, and is convertible, at the option of the lender, into common shares at a conversion price of $0.50 per share. On December 31, 2013 we amended the credit agreement to increase the borrowing limit under the line of credit to $1,250,000 and extend the maturity date to December 31, 2014. On December 31, 2014 we again amended the credit agreement to increase the borrowing limit under the line of credit to $1,500,000 and extended the maturity date to December 31, 2015. On December 31, 2015 we again amended the credit agreement to increase the borrowing limit under the line of credit to $1,650,000 and extended the maturity date to December 31, 2016. Effective October 13, 2016, we again amended the credit agreement to increase the borrowing limit under the line of credit to $1,750,000 and extended the maturity date to December 31, 2017. All other provisions under the agreement remained unchanged. The Company evaluated the convertible line of credit for derivative and beneficial feature conversion and concluded that there is no beneficial conversion since the conversion price at inception was greater than the market value of shares that would be issued upon conversion. Likewise, derivative accounting did not apply to the embedded conversion option.

The credit facility also contains customary representations and warranties (including those relating to organization and authorization, compliance with laws, payment of taxes and other obligations, absence of defaults, material agreements and litigation) and customary events of default (including those relating to monetary defaults, covenant defaults, cross defaults and bankruptcy events).

Total principal amounts owed under the credit facility notes payable were $1,715,620 and $1,500,000 at December 31, 2016 and 2015, respectively. Borrowings under our convertible note payable to Mr. Gibbs were $215,620 and $254,000 for the years ended December 31, 2016 and 2015, respectively, and were generally used to pay certain mining lease obligations as well as operating expenses. No principal or interest payments were made to Mr. Gibbs during either the years ended December 31, 2016 or 2015. As of December 31, 2016 there remained $34,380 of credit available for future borrowings.

Total accrued interest on the notes payable to Mr. Gibbs was $257,916 and $176,733 at December 31, 2016 and 2015, respectively, and are included in Accrued interest - related parties on the accompanying consolidated balance sheets.

Note Payable – Related Party

On September 12, 2016 we executed a Note Payable (“Note”) with Mr. John Power, the Company’s President and Chief Executive Officerhave recorded stock-based compensation in the amount of $45,000. The Note accrues interest at 6% per year, and matures on September 12, 2018. The Note requires monthly principle and interest payments of $1,994 beginning on October 12, 2016. At December 31, 2016 the Note balance was $39,665, and a total of $124 of interest had accrued since the last payment and is included in Accrued interest – related parties on the accompanying balance sheet.$30,000.

 

Interest ExpenseNote 6Related Parties

Total related party interest expense was $81,956 and $68,806 for the years ended December 31, 2016 and 2015, respectively.

Note 7 - Commitments and Contingencies

 

We are subject to various commitments and contingencies under the Langtry Lease/Option to Purchase as discussed in Note 3 – Mining Rights and Properties.

Note 8 - Share-based Compensationcontingencies.

 

2004 Equity Incentive Plan

A summary of our stock option activity for options issued under the 2004 Equity Incentive Plan as well as options outstanding that were issued outside the Plan is as follows:

 

 

Shares

 

Weighted Average Exercise Price

Outstanding at December 31, 2014

 

750,000

 

$ 0.29

Options granted

 

0

 

 

Outstanding at December 31, 2015

 

750,000

 

$ 0.29

Options expired

 

(150,000)

 

$ 0.43

Outstanding at December 31, 2016

 

600,000

 

$ 0.26

The weighted average contractual life of all outstanding options at December 31, 2016 was 1.3 years. No share based compensation expense was recorded for either the years ended December 31, 2016 or 2015.

Note 97Related Party Transactions

 

Conflicts of Interests

Magellan Gold Corporation (“Magellan”) is a company under common control. Mr. Power is a significant shareholder and director of both Athena and Magellan. Mr.John Gibbs is a significant shareholder and creditor (see Note 6 – Credit Agreement and Notes Payable – Related Parties), in both Athena and Magellan. Athena and Magellan are both involved in the business of acquisition and exploration of mineral resources.

 

Silver Saddle Resources, LLC (“Silver Saddle”) is also a company under common control. Mr. Power and Mr. Gibbs are the owners and managing members of Silver Saddle. Athena and Silver Saddle are both involved in the business of acquisition and exploration of mineral resources.

 

There exists no arrangement or understanding with respect to the resolution of future conflicts of interest. The existence of common ownership and common management could result in significantly different operating results or financial position from those that could have resulted had Athena, Magellan and Silver Saddle been autonomous.

  

F-16

Management Fees – Related Parties

The Company is subject to a month-to-month management agreement with Mr. Power requiring a monthly payment of $2,500 as consideration for the day-to-day management of Athena. For each of the years ended December 31, 2016 and 2015, a total of $30,000Athena, $30,000 was recorded as management fees and are included in general and administrative expenses in the accompanying Consolidated Statementsconsolidated statements of Operations. Asoperations. Mr. Power submits expense reports for ordinary business expenses with a balance due as of December 31, 2016 and 2015, $25,000 and $2,500, respectively,2022 of $30,006.

On January 1, 2021, the Company agreed to convert the $96,500 balance of management fees due Mr. Power had not been paid and are included in accrued liabilities on the accompanying consolidated balance sheetsinto 2,144,444 shares of common stock at December 31, 2016 and 2015, respectively.a price of $0.045 per share.

 

Accrued Interest - Related PartiesNote Payable

 

At December 31, 2016 During March 2022, the Company executed two promissory notes with John Gibbs for $50,000 and 2015, Accrued interest - related parties includes accrued interest$25,000 at 6% that is payable on demand. In April 2022, the Company issued 1,181,250 shares out of 3,375,000 shares of common stock in April 2022 at C$.08 per share as a part of the private placement offering to settle $75,000 of notes payable to Mr. Gibbs, for total proceeds of C$234,675.

In June 2022, the Company executed a promissory note with John Gibbs for $26,100 at 6% that is payable on demand as part payment for mineral property in escrow. In September 2022, the amountsCompany issued 443,110 shares out of $257,916860,200 shares of common stock in September 2022 at C$.08 per share as a part of the private placement offering to settle $26,100 of notes payable and $176,733, respectively, representing unpaid$463 of accrued interest on the credit facility. In addition, at December 31, 2016 Accrued interest - related parties includes $124 of interest accrued on the installment Note payable due to Mr. Power.Gibbs, for total proceeds of C$68,816.

 

Advances Payable - Related PartiesSales of Common Stock

On May 25, 2021, the Company sold 2,200,000 units in its private placement at a price of C$0.08 to Mr. Gibbs, realizing net proceeds of $144,848. During the same private placement, Mr. Power purchased 300,000 units realizing net proceeds of $19,752.

 

Mr. Power has on occasion advancedOn January 15, 2021, the Company funds generally utilized for day-to-day operating requirements. These advances are non-interest bearing and are generally repaid as cash becomes available.sold 250,000 shares of common stock at a price of $0.03 per share in a private placement to Mr. Gibbs, realizing total proceeds of $7,500.

 

During the year ended December 31, 2016, Mr. Power made short-term advances to the Company of $7,250, all of which was repaid during the year. At both December 31, 2016 and 2015 no advances were outstanding.

The Company also utilizes credit cards owned by Mr. Power to pay various obligations when an online payment is required, the availability of cash is limited, or the timing of the payments is considered critical.

Note 10 - 8 – Income Taxes

 

The Company is current on all of its corporate tax filings. Tax year 2016 is currently under extension and we expect to file2022 will be extended if not filed by its due date. Tax returns filed for the returns by the due date.years 2018 through 2021 are open for examination from taxing authorities.

 

Due to the enactment of the Tax Reform Act of 2018, the corporate tax rate for those tax years beginning with 2018 has been reduced to 21%. Our estimated net operating loss carry forward as of December 31, 20162022, is $6,653,793,$6,755,942, which may be used to offset future income taxes through 2037.taxes. Our reconciliation between the expected federal income tax benefit computed by applying the federal statutory rate to our net loss and the actual benefit for taxes on net loss for 20162022 and 20152021 is as follows:

 Reconciliation of income taxes      
  Years Ended December 31, 
  2022  2021 
Expected federal income tax benefit at statutory rate $224,568  $216,354 
State taxes  94,532   91,075 
Change in valuation allowance  (319,100)  (307,429)
Income tax benefit $  $ 

 

 

 

 

Years Ended December 31,

 

 

 

2016

 

2015

 

Expected federal income tax benefit at statutory rate

 

$

95,884

 

$

101,816

 

State taxes

 

 

9,870

 

 

10,481

 

Change in valuation allowance

 

 

(105,754)

 

 

(112,297)

 

Income tax benefit

 

$

 

$

 

 

F-17

 

Our deferred tax assets as of December 31, 20162022, and 20152021 were as follows:

 

 

December 31,

 

 

 

2016

 

2015

 

Net operating loss

 

$

2,495,172

 

$

2,389,418

 

Valuation allowance

 

 

(2,495,172)

 

 

(2,389,418)

 

Deferred tax assets, net of allowance

 

$

 

$

 

 Schedule of deferred tax      
  Years Ended December 31, 
  2022  2021 
Net operating loss $2,015,974  $1,696,874 
Valuation allowance  (2,015,974)  (1,696,874)
Deferred tax assets, net of valuation allowance $  $ 

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We have provided a valuation allowance of 100% of our net deferred tax asset due to the uncertainty of generating future profits that would allow us to realize our deferred tax assets.

 

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryover for Federal income tax reporting purposes may be subject to annual limitations. Should a change in ownership occur, use of the net operating loss carryover could be limited in future years.

 

Note 11 - 9 – Subsequent Events

 

Subsequent to December 31, 2016On January 16, 2023, the Company borrowed an additional $90,000 under the credit agreementgranted 250,000 stock options to a consultant. The options vest 50% immediately and 50% one year from Mr. Gibbs.issuance, exercisable at C$0.09 and expire in 5 years.

 

Subsequent to December 31, 2016,On January 21, 2023, the Company paid an option payment in the amount of $44,675executed a note payable to John Gibbs for $25,000 at 6% that is payable on its Langtry project for the period March 15, 2017 to March 15, 2018.demand.

 

 

 


 

F-18

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this amended annual report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

ATHENA SILVERGOLD CORPORATION

Date: March 29, 2017

15, 2023

By: By:/s/ John C. Power

John C. Power

Chief Executive Officer, President,

Chief Financial Officer, Secretary & Director

(Principal Executive Officer)

Date: March 15, 2023

By: /s/ Tyler Minnick

Tyler Minnick

Chief Financial Officer

(Principal Accounting Officer)

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

SIGNATURE

TITLE

DATE

/s/ John C. Power

John C. Power

Chief Executive Officer, President,

Chief Financial Officer, Secretary & Director

(Principal Executive Officer)

March 15, 2023
March 15, 2023

/s/ Brian Power

Brian Power

Director

/s/ John Hiner

John Hiner

DirectorMarch 15, 2023

/s/ Markus Janser

Markus Janser

DirectorMarch 15, 2023

/s/ Tyler Minnick

Tyler Minnick

Chief Financial Officer

(Principal Accounting Officer)

March 29, 2017

March 29, 2017

/s/ Brian Power

Brian Power

Director

/s/ LeRoy Wilkes

LeRoy Wilkes

Director

March 29, 2017

15, 2023

 

 

53