UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

[   ]☐    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

[X]☒    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year endedDecember 31, 2018 (and December 31, 2017)2021

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

For the transition period from ____________ to ____________

[   ]☐    SHELL COMPANY PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report __________________

Commission file number: 000-29922

TOMBSTONE EXPLORATION CORPORATION

TOMBSTONE EXPLORATION CORPORATION

(Exact name of Registrant as specified in its charter)

Not Applicable

(Translation of Registrant'sRegistrant’s name into English)

Canada

(Jurisdiction of incorporation or organization)

6529 E. Friess Drive

Scottsdale, AZ 85254

(Address of principal executive offices)

Alan Brown

6529 E. Friess Drive

Scottsdale, AZ 85254

(480) 588-8920

(Name, address and telephone of Company contact person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

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

Common Shares Without Par Value

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

Not Applicable

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

There were 666,651,26512,210,746 Common Shares without par value issued and outstanding as at May 7, 2019.June 28, 2022.

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

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. [X] YES [   ]☒ Yes ☐ NO

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]☒ Yes ☐ 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). [X] YES [   ]☒ Yes ☐ NO (Not Applicable)

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

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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.[   ] ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codi cationCodification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP [X]☒ International Financial Reporting Standards as issued by the International Accounting Standards Board[   ] ☐ Other [   ]☐

 If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. [   ]☐ Item 17 [   ]☐ Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [   ]☐ YES     [X]☒ NO

EXPLANATORY NOTE 

This Annual Report on Form 20-F includes the full Annual Report for the fiscal year ended December 31, 2018 as well as for the year ended December 31, 2017. This combined Form 20-F is being filed due to the fact the Company was unable to file its 2017 Annual 20-F due to significant financial hardship.

TABLE OF CONTENTS

GENERAL

We use the U.S. dollar as our reporting currency. All references in this Annual Report to “dollars” or “$” are expressed in U.S. dollars, unless otherwise indicated. See also “Item 3. Key Information” for more detailed currency and conversion information. Our consolidated financial statements which form part of this Report are presented in U.S. dollars and are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).

FORWARD-LOOKING STATEMENTS

Except for the statements of historical fact contained herein, some information presented in this Report constitutes forward-looking statements. When used in this Report, the words “estimate”, “project”, “believe”, “anticipate”, “intend”, “expect”, “predict”, “may”, “should”, the negative thereof or other variations thereon or comparable terminology are intended to identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of our Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, changes in project parameters as plans continue to be refined, future prices of silver, as well as those factors discussed in the section entitled “Risk Factors”. Although our Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause actual results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. The forward-looking statements in this Report speak only as to the date hereof. Our Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

As used in this report, the terms “we”, “us”, “our”, “Tombstone”, “Tombstone Exploration”, and “TMBXF” means Tombstone Exploration Corporation, unless otherwise indicated.

PART I

FINANCIAL INFORMATION AND ACCOUNTING PRINCIPLES

The consolidated financial statements and summaries of financial information contained in this document are reported in U.S. dollars (“$”) unless otherwise stated. All such consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles.

The consolidated financial statements of the Company for the yearyears ended December 31, 2017 and 20182021 have been audited by Sadler Gibb & Associates, LLC, 2455RBSM LLP, 770 East Parleys Way,Warm Springs Road, Suite 320, Salt Lake City, UT 84109.225, Las Vegas, NV, 89119. The consolidated financial statements of the Company for the yearyears ended December 31, 20152020 and 2016 have been2019 were audited by AntonSadler, Gibb & Chia LLP, 3501 Jamboree Rd., Newport Beach, CA 92660.Associates, 344 West 13800 South, Suite 250, Draper, UT 84020. 

ITEMItem 1. Identity of Directors, Senior Management and Advisers

Not Required.

ITEMItem 2. Offer Statistics and Expected Timetable

Not Required.

ITEMItem 3. Key Information

A. Selected Financial Data

The following tables set forth the data of our fiscal years ended December 31, 20092017 to December 31, 2018.2021. We derived all figures from our financial statements as prepared by our management, approved by our audit committee and audited by our independent auditor.committee. This information should be read in conjunction with our financial statements included in this annual report.

Our financial statements included in this Report have been prepared in accordance with accounting principles generally accepted (“GAAP”) in the United States (“US”). All amounts are expressed in United States dollars.

SUMMARY OF FINANCIAL INFORMATION IN THE COMPANY'SCOMPANY’S FINANCIAL STATEMENTS

B. Capitalization and Indebtedness

Not required.

C. Reasons for the Offer and Use of Proceeds

Not required. 

D. Risk Factors

D. Risk Factors

This Report contains forward-looking statements which relate to future events or our future performance, including our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, or “potential” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks enumerated in this section entitled “Risk Factors”, that may cause our Company’s or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this Report. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

An investment in our common stock involves a number of very significant risks. You should carefully consider the following risks and uncertainties in addition to other information in this Report in evaluating our Company and our business before purchasing shares of our Company’s common stock. Our business, operating results and financial condition could be seriously harmed due to any of the following risks. The risks described below are not the only ones facing our Company. Additional risks not presently known to us may also impair our business operations. You could lose all or part of your investment due to any of these risks.

Risks Associated with Mining

Our mining propertiesRisks Related to Pandemics

The near-term effects of the recent COVID-19 coronavirus pandemic are in the exploration stage. There is no assurance thatknown, as they adversely affected our properties contain any mineral resources in commercially exploitable quantities. If we dobusiness. Longer term effects are not discover any mineral resource in a commercially exploitable quantity,immediately known and may adversely affect our business, will failresults of operations, financial condition, liquidity and investors may lose all of their investment in our Company.cash flow.

Despite our acquisitionWhile the negative impact of mineral claims and rights, and continuous search to develop those claims, we have not established that anyCOVID pandemic is lessening, the impact of them contain any commercially exploitable mineral reserves, nor can there be any assurance that we will ever find commercially exploitable mineral reserves. The probability of an individual prospect ever having a commercially exploitable mineral reserve is extremely remote; in all probability, our mineral resource claims do not contain any reserves and any funds that we spend on exploration will probably be lost. The search for valuable minerals as a business is extremely risky. We can provide investors with no assurance that any explorationCOVID-19 has had adverse effects on our properties will establish that commercially exploitable reserves of minerals exist on our mining claims. Additional potential problems that may prevent us from discovering any reserves of minerals on our properties include, but are not limited to, unanticipated problems relating to exploration and additional costs and expenses that may exceed current estimates. Most of these factors are beyond our control, and any of them could increase costs and make extraction of any identified mineral resource unprofitable.

If we are unable to establish the presence of commercially exploitable reserves of minerals on our properties,business by slowing down our ability to fund future exploration activities willwork with third parties outside of Arizona throughout much of 2021. The Company suffered Covid related schedule delays in relation to the leach pad construction such as losing most of the liner crew for almost three months, permit delays in the final water well approval, and finding a water well driller, everything is finally coming together for start-up. We believe Covid related issues affected our schedule by as much as five months in 2020 and affected various aspect of our construction, purchase, and location of parts and equipment. It is difficult to predict what other adverse effects, if any, COVID-19 can have on our business, or against the various aspects of same.

General securities market uncertainties resulting from the COVID-19 pandemic.

Since the outset of the pandemic the United States and worldwide national securities markets have undergone unprecedented stress due to the uncertainties of the pandemic and the resulting reactions and outcomes of government, business and the general population. These uncertainties have resulted in declines in all market sectors, increases in volumes due to flight to safety and governmental actions to support the markets. As a result, until the pandemic has stabilized, the markets may not be impeded,available to the Company for purposes of raising required capital. Should we will not be able to operate profitablyobtain financing when required, in the amounts necessary to execute on our plans in full, or on terms which are economically feasible we may be unable to sustain the necessary capital to pursue our strategic plan and investors may lose allhave to reduce the planned future growth and/or scope of their investment in our Company.operations.

Risks Associated with Mining

We have not established proven or probable mineral reserves at our only producing property, the Bonanza Harquahala Mine project.

We have not established proven or probable reserves, as defined by the SEC under Industry Guide 7 or Canadian securities regulators, at the Bonanza Harquahala Mine. In order to establish proven reserves under SEC Industry Guide 7, we would be required to prepare a final, “bankable” feasibility study. Due to the size of the Bonanza Harquahala Mine deposit, at the present time we do not believe it is necessary to incur the expense and delay involved in preparing a bankable feasibility study in order to bring the Rodeo project into production. Our production and after-tax cash flow estimates at the Bonanza Harquahala Mine are based in part on the mineralized material estimate, therefore, and because the estimate does not constitute proven reserves under SEC Industry Guide 7, the production and after-tax cash flow estimates which are derived therefrom are inherently more uncertain than would otherwise be the case if the Bonanza Harquahala Mine were supported by a bankable feasibility study and estimate of proven reserves established in accordance with Industry Guide 7.

In making the decision to commence mining the Bonanza Harquahala Mine, we made certain assumptions regarding operating and capital costs and project economic returns. These estimates of average cash operating costs are based upon, among other things (i) anticipated tonnage, grades and metallurgical characteristics of the ore to be mined and processed; (ii) anticipated recovery rates of silver and other metals from the ore; (iii) cash operating costs of comparable facilities and equipment; and (iv) anticipated climatic conditions. Actual cash operating costs, production and economic returns may differ significantly from those anticipated by our internal studies and estimates.

Our exploration properties may not contain mineral reserves.

We are considered an exploration stage company under SEC Industry Guide 7, and none of our properties have been shown to contain proven or probable mineral reserves as defined under Industry Guide 7. Expenditures made in mining at our properties may not result in positive cash flow or in discoveries of commercially recoverable quantities of ore. Most exploration projects do not result in the discovery of commercially mineable ore deposits, and we cannot assure you that any mineral deposit we identify will qualify as an orebody that can be legally and economically exploited or that any particular level of recovery from discovered mineralization will in fact be realized.

Our mineralized material estimates are inherently imprecise.

We have released estimates of mineralized material at the Bonanza Harquahala Mine. Mineralized material figures based on estimates made by geologists are inherently imprecise and depend on geological interpretation and statistical inferences drawn from drilling and sampling that may prove to be unreliable or inaccurate. We cannot assure you that these estimates are accurate, and even if the estimates are accurate, the economic viability of the project may not justify exploitation.

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

Mineral exploration is highly speculative in nature and frequently results in no or very little return on amounts invested to evaluate a particular property. Substantial expenditures are required to (i) establish the existence of a potential ore body through drilling and metallurgical and other testing techniques; (ii) determine metal content and metallurgical recovery processes to process metal from the ore; (iii) determine the feasibility of mine development and production; and (iv) construct, renovate or expand mining and processing facilities. If we discover a deposit or ore at a property, it usually takes several years from the initial phases of exploration until production is possible, if at all. During this time, the economic feasibility of a project may change because of increased costs, lower metal prices or other factors. As a result of these uncertainties, our exploration programs may not result in the identification of proven and probable reserves in sufficient quantities to justify developing a particular property.

We face intense competition in the mineral exploration and exploitation industry, and we compete with our competitors for financing, for new mineral resource properties and for qualified managerial and technical employees.

Our competition includes large established mining companies with substantial capabilities and with greater financial and technical resources than those available to us. As a result of this competition, we may have to compete for financing and be unable to acquire financing on terms we consider acceptable. This competition could adversely affect our ability to acquire suitable prospects for exploration in the future. We may also have to compete with other mining companies in the recruitment and retention of qualified managerial and technical employees. If we are unable to successfully compete for financing or for qualified employees, our exploration programs may be slowed down or suspended. If we are unable to successfully compete for the acquisition of suitable prospects for exploration in the future, there can be no assurance that we will acquire any interest in additional mineral resource properties. The occurrence of any of these things may cause us to cease operations as a company.

Because of the inherent dangers involved in mineral exploration and exploitation, there is a risk that we may incur liability or damages as we conduct our business.

The search for valuable minerals involves numerous hazards that may subject us to liability including pollution, cave-ins and other hazards against which we cannot insure or against which we may elect not to insure. At the present time, we have no coveragea general liablity policy of $2 million for the Bonanza Harquahala Mine operations to insure against these hazards. The payment of such liabilities may have a material adverse effect on our financial position.

Title to our resource properties may be challenged by third parties which could result in the loss of substantial amounts of money and resources and could cause our interests in our properties to expire or be forfeit.forfeited.

We have investigated the status of our titles to our mineral resource properties, and we are satisfied that the title to these properties is properly registered in the name of our Company, but we cannot guarantee that the rights to explore our claims will not be revoked or altered to our detriment. The ownership and validity of mining claims and concessions are often uncertain and may be contested. Should such a challenge to the boundaries or registration of ownership arise, the resolution of disputes or the process of clarifying the accuracy of our mining license registration could take substantial time and money. Further, the preservation of our title to our mineral claims requires that we continue to expend money or work the claims. If we fail to expend the necessary amount of money or if we fail to work our mineral claims, then our title to our mineral claims could expire or be forfeited.

Mineral prices are subject to dramatic and unpredictable fluctuations.

The market price of precious metals and other minerals is volatile and has fluctuated widely, particularly in recent years. The prices of various metals are affected by numerous factors beyond our control, including international economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates and global or regional consumption patterns, speculative activities, and increased production due to improved mining and production methods. The supply of and demand for metals are affected by various factors, including political events, economic conditions and production castscosts in major mineral producing regions. Variations in the market prices of metals may have an impact on our ability to raise funding to continue exploration of our claims. In addition, any significant fluctuations in metal prices will impact our decision to accelerate or reduce our exploration activities. If the price of precious metals and other minerals should drop significantly, the cost of mineral extraction may be higher than is economically feasible. The marketability of minerals is also affected by numerous other factors beyond our control, including government regulations relating to royalties, allowable production and importing and exporting of minerals, the effect of which cannot be accurately predicted.

Mineral operations are subject to government regulations which could have the effect of reducing or preventing us from exploiting any possible mineral reserves on our claims.

Exploration activities are subject to national and local laws and regulations governing prospects, taxes, labor standards, occupational health, land use, environmental protection, mine safety, and others which may in the future have a substantial adverse impact on our Company’s prospects. In order to comply with applicable laws, we may be required to make capital expenditures until a particular problem is remedied. Existing and possible future environmental legislation, regulation and action could cause additional expense, capital expenditure, restriction, and delay in the activities of our Company, the extent of which cannot be reasonably predicted. If we violate any applicable law or regulation, we could be forced to stop work and we could be fined. If we are forced to suspend our activities or if we are required to pay a large fine for a violation of these applicable laws and regulations, our business could be adversely affected.

Our operations may be subject to environmental regulations which may result in the imposition of fines and penalties.

Our operations may be subject to environmental regulations promulgated by government agencies from time to time. Environmental legislation provides for restrictions and prohibitions on spills, releases or emissions of various substances produced in association with certain mining industry operations, such as seepage from tailings disposal areas, which would result in environmental pollution. A breach of such legislation may result in the imposition of fines and penalties. Environmental legislation is evolving in a manner which means stricter standards, and enforcement; fines and penalties for non-compliance are more stringent. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers, and employees. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations.

Risks Related to Our Company

The fact that we have not generated any operating revenues for the last ten years raises substantial doubt about our ability to continue as a going concern.

We have not generated any operating revenues for the last ten yearssince our inception and, we will, in all likelihood, will continue to incur operating expenses without revenues until our mining claims are fully developed and in commercial production. As a result, we need to generate significant revenues from our operations or obtain financing. We cannot assure that we will be able to successfully explore and develop our mining claims or assure that viable reserves exist on the claims for extraction. These circumstances raise substantial doubt about our ability to continue as a going concern. It is unlikely that we will generate any funds internally until we discover commercially viable quantities of precious metals and other minerals. If we are unable to generate revenue from our business in the next twelve months, we may be forced to delay, scale back, or eliminate our exploration activities. If any of these actions were to become necessary, we may not be able to continue to explore our properties or operate our business and if either of those events happen, then there is a substantial risk our business would fail.

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

As of the date of this Report, we have not yet located any mineral reserve. As a result, we have never had any revenues from our operations. In addition, we have no operating history related to the acquisition and exploration of our mineral properties. We have no way to evaluate the likelihood of whether our mineral claims contain any mineral reserve or, if they do that we will be able to build or operate a mine successfully. We anticipate that we will continue to incur operating costs without realizing any revenues during the period when we are exploring our claims. We expect to continue to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from mining operations and any dispositions of our claims, we will not be able to earn profits or continue operations. At this stage of our operation in this industry, we also expect to face the risks, uncertainties, expenses and difficulties frequently encountered by companies at the start up stage of their business development. We cannot be sure that we will be successful in addressing these risks and uncertainties and our failure to do so could have a material adverse effect on our financial condition. There is no history upon which to base any assumption as to the likelihood that we will prove successful and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations.

We have not generated any revenue from our business, and we may need to raise additional funds in the near future. If we are not able to obtain future financing when required, we might be forced to discontinue our business.

Because we have not generated any revenue from our business and we cannot anticipate when we will be able to generate revenue from our business, we will need to raise additional funds for the further exploration and future development of our mining claims and to respond to unanticipated requirements or expenses. During the year ended December 31, 2018, we received $165,500 in financing and for year ended December 31, 2017 we received $415,000 in financing. However, if our expenses exceed these funds, we will need to secure additional financing for further exploration and development of our projects or to fulfill our obligations under any applicable agreements. Although we have been successful in the past in obtaining financing, there can be no assurance that we will be able to obtain adequate financing in the future or that the terms of such financing will be favorable. Failure to obtain such additional financing could result in a delay or indefinite postponement of further exploration and development of our projects with the possible loss of such properties.

Canada Business Corporations Act provides for the indemnification of our officers and directors against all costs, charges and expenses incurred by them in respect of any civil, criminal, administrative, investigative or other proceeding.

The Canada Business Corporations Act contains provisions limiting the liability of our officers and directors for their acts and failures to act and for any loss, damage or expense incurred by our Company which shall happen in the execution of their duties of such officers or directors, unless the officers or directors did not act honestly and in good faith with a view to the best interests of our Company. Such limitations on liability may reduce the likelihood of derivative litigation against our officers and directors and may discourage or deter our shareholders from suing our officers and directors based upon breaches of their duties to our Company, though such an action, if successful, might otherwise benefit our Company and our shareholders.

Risks Relating to our Securities

Investors’ interests in our Company will be diluted and investors may suffer dilution in their net book value per share if we issue additional shares or raise funds through the sale of equity securities.

We are currently without a source of revenue and will most likely be required to issue additional shares to finance our operations and, depending on the outcome of our exploration programs, may issue additional shares to finance additional exploration programs of any or all of our projects or to acquire additional properties. If we are required to issue additional shares to raise financing, your interests in our Company will be diluted and you may suffer dilution in your net book value per share depending on the price at which such securities are sold. Further, if we issue any share purchase warrants or share purchase options, and they are exercised, there will be a reduction in the proportionate ownership and voting power of all other shareholders. The dilution may result in a decline in the market price of our common shares.

Investors’ interests in our Company will be diluted and investors will suffer dilution in their net book value per share if we issue employee/director/consultant options.

We may in the future grant to some or all of our directors, officers, insiders, and key employees, options to purchase our common shares as non-cash incentives to those persons. Such options may be granted at exercise prices equal to market prices, or at such other price as may be permitted under the policies of any stock exchange upon which our securities are traded (currently, our common shares are listed for trading on the OTCPK)OTCQB Venture Market), when the public market is depressed. The issuance of additional shares will cause our existing shareholders to experience dilution of their ownership interests.

We do not plan to pay any Dividends in the foreseeable future.

The Company has never paid a dividend and it is unlikely that the Company will declare or pay a dividend until warranted based on the factors outlined below. The declaration, amount, and date of distribution of any dividends in the future will be decided by the Board of Directors from time-to-time, based upon, and subject to, the Company’s earnings, financial requirements and other conditions prevailing at the time.

In the event that key employees leave the Company, the Company would be harmed since we are heavily dependent upon them for all aspects of our activities.

The Company is heavily dependent on our officers and directors, key employees and contractors, the loss of whom could have, in the short-term, a negative impact on our ability to conduct our activities and could cause a decline in profitability of our properties or additional costs from a delay in development or exploration of properties. The Company has consulting agreements with key employees and contractors, and an employment agreement with our President.President and CEO, Alan Brown.

We face exposure to fluctuations in the price of our common stock due to the very limited cash resources we have.

The Company has very limited resources to pay its professionals. If we are unable to pay professionals in order to perform various professional services for the Company, it may be difficult, if not impossible, for the Company to maintain its reporting status under the Exchange Act. In 2018, when preparing to audit its financials for the year ended December 31, 2017 the Company’s prior auditor shut down their practice as the result of certain litigation against them. This caused a financial hardship to the Company delaying its annual report filing. If the Company felt that it was likely that it would not be able to maintain its reporting status, it would make a disclosure by filing a Form 6-K with the SEC. In any case, if the Company wasis not able to maintain its reporting status, it would become “delisted” and this would potentially cause an investor or an existing shareholder to lose all or part of his investment.

The Company does not anticipate any contingency upon which it would voluntarily cease filing reports with the SEC, even though it may cease to be required to do so.

It is in the compelling interest of the Company to report its affairs annually and currently, as the case may be, generally to provide accessible public information to interested parties, and also specifically to maintain its qualification for the OTCPK,OTCQB, if and when the Company’s intended application for submission is effective.

The success of the Company will depend on the developments of an active trading market.

While the Company'sCompany’s common shares are included on Over the Counter Markets (OTCPK)(OTCQB), there can be no assurance that an active trading market for the common shares will develop. In the absence of such a market, investors may be unable to readily liquidate their investment in the common shares. The market for equity securities in general has been volatile and the trading price of the common shares could be subject to wide fluctuations in response to general market trends, changes in general conditions in the economy, the financial markets and other factors that may be unrelated to the Company'sCompany’s performance.

Low-Priced Stocks are subject to greater Disclosure Requirements.

The Securities and Exchange Commission adopted rules (“Penny Stock Rules”) that regulate broker-dealer practices in connection with transactions in penny stocks. The common shares of the Company fall within the Commission'sCommission’s definition of a penny stock. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current prices and volume information with respect to transactions in such securities is provided by the exchange or system). The Penny Stock Rules require a broker-dealer, prior to effecting a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the Securities and Exchange Commission that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer'scustomer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer'scustomer’s confirmation. In addition, the Penny Stock Rules require that prior to a transaction in a penny stock not otherwise exempt from such rules, the broker-dealer must receive the purchaser'spurchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that is subject to the Penny Stock Rules. At any time when the Company'sCompany’s common stock is subject to the Penny Stock Rules, shareholders may find it more difficult to sell their shares.

ITEMItem 4. Information on the Company

A. History and Development of the Company

The Company was incorporated as a federal company pursuant to the laws of Canada under theCanada Business Corporations Act (the “Act”) on October 30, 1997, under the name 3430502 Canada Ltd. In December 1997, the Company changed its name to Four Crown Foods Inc. At the time, the Company was involved in the food and beverage retail business. Then in June 2000, the Company changed its name to Universal Domains Incorporated and operated in the domain registration business upon the acquisition of the license rights to a domain registration agreement for the “.cc” internet registration domain.

In November 2003, the Company ceased all operations and in September 2004, the Company changed its name to Pure Capital Incorporated. From that time until November 1, 2006, the Company’s goals were to continue to reduce the liabilities of the Company in an effort to obtain additional financing and explore the possibilities of starting a new operating business, and/or merge with or become acquired by another company or entity.

On November 27, 2006, the Company acquired full rights and title to certain mining and exploration claims located in the State of Arizona along with other equipment and properties from Redhawk Exploration & Development, Inc., a Texas corporation.

Then on February 6, 2007, the Company changed its name to Tombstone Exploration Corporation to reflect its current operations in the mining and exploration industry. Since that time, we have been operating in the mineral resource business and the primary focus of operations has been to generate revenue from the production of silver and gold, as well as additional base minerals such as copper, lead and zinc. The goal is to produce metals and minerals at or below standard industry costs. The historical nature of mining activities of our present holdings and the acceptance of governmental agencies will enable easier startup here than in non-mining oriented locations.

Following identification of suitable areas during our drilling programs, which we anticipate will continue in the future, the Company may initiate mineral extraction if sufficient funding and permitting are secured. These efforts will provide an operating financial base from which to expand. Continuing geological research, testing and drilling is planned based on the initial geological report. This will assist in the identification of key target areas, as well as establish reserve categories.

Discussions with precious metal processing and consulting companies to assist in the design of the overall operation of our mining claims have been initiated. Relationships have already been established with refineries, assay companies and engineering firms supporting worldwide mineral processing operations.

B. Business Overview

This business generally consists of three stages: exploration, development, and production. We are a mineral resource company in the exploration stage because we have not yet found mineral resources in commercially exploitable quantities and are engaged in exploring land in an effort to discover them. Mineral resource companies that have located a mineral resource in commercially exploitable quantities and are preparing to extract that resource are in the development stage, while those engaged in the extraction of a known mineral resource are in the production stage.

Mineral resource exploration can consist of several stages. The earliest stage usually consists of the identification of a potential prospect through either the discovery of a mineralized showing on that property or as the result of a property being in proximity to another property on which exploitable resources have been identified, whether or not they are or have in the past been extracted.

After the identification of a property as a potential prospect, the next stage would usually be the acquisition of a right to explore the area for mineral resources. This can consist of the outright acquisition of the land or the acquisition of specific, but limited, rights to the land (e.g., a license, lease, or concession). After acquisition, exploration would probably begin with a surface examination by a prospector or professional geologist with the aim of identifying areas of potential mineralization, followed by detailed geological sampling and mapping of this showing with possible geophysical and geochemical grid surveys to establish whether a known trend of mineralization continues underground, possibly trenching in these covered areas to allow sampling of the underlying rock. Exploration also commonly includes systematic regularly spaced drilling in order to determine the extent and grade of the mineralized system at depth and over a given area, as well as gaining underground access by ramping or shafting in order to obtain bulk samples that would allow one to determine the ability to recover various commodities from the rock. If minerals are found, exploration might culminate in a feasibility study to ascertain if the mining of the minerals would be economic. A feasibility study is a study that reaches a conclusion with respect to the economics of bringing a mineral resource to the production stage.

The Bonanza Project

LOCATION: Salome, Arizona,8 miles north of the Hovatter Road exit off of Interstate -10, and 8 miles

Latitude: 33° 40.131’N

Longitude: 113° 35.177’W

OWNERSHIP: 40% Tombstone, 60% Goldrock Resources, Inc.

MINERALS: Gold, Silver and Copper 

PROPERTY SIZE: 2,656 acres

Gold was discovered in the Harquahala area in 1862. There were a reported 120,560 ounces of gold from the mine from 1891 to 1929. Grades of gold were reported to be over an ounce per ton of gold from the Bonanza mine.

The Bonanza Project is Tombstone’s latest acquisition, and the property includes the Harquahala and Golden Eagle mines, located approximately eight miles south of Salome, Arizona. The project totals 2,656 acres and has significant underground workings, from which some 180,000-200,000 ounces of gold were reportedly produced from high-grade ore in the late 1800’s and early 1900’s. Mined rock and tailings from previous operations represent an additional potential resource. The project will be in partnership with Richard Moores, CEO and Director of Goldrock Resources, Inc., and Todd Fayram, Director of Goldrock Resources, Inc., who have a 60% majority investment in the project, and Tombtsone owns a 40% interest. Bonanza Area Claim Block with Defined 250-350k oz Au Target Areas.1-1.5+ MM oz Au Overall Potential

Facility Description:

Bonanza Mining Company (Bonanza) will operate the Harquahala Mine to reprocess historical (pre-1986) surface gold bearing ores and tailings. The operation will collect the historic ores and tailings to extract and recover the gold.

Approximately 242,000 cubic yards of historic ores and tailings will be consolidated in controlled areas prior to being sized and placed onto a newly constructed double-lined heap leach pad (approximately 314,000 square feet (sq. ft)). The gold will be extracted in the newly constructed 4,126,239-gallon double-lined pregnant solution pond, with a maximum operational storage requirement estimated to be 3,965,780 gallons. The extraction operation will consist of loading and hauling; primary and secondary crushing; agglomeration and stacking; heap leaching using cyanide solution, storage of process solutions in ponds; and precious metals recovery using granular activated carbon (GAC). The final phase of the gold extraction from the GAC will be performed off-site. The facility will includes an intermediate stockpile that will be permitted under a Type 2.02 general permit.

Update to the permitting:

The three permits necessary to operate are: Aquifer Protection Permit (APP), BLM Mine Plan of Operations for Public Land (MPO), and a Reclamation Plan for private property are all well into the permitting process. All permits are considered administratively complete as of December 31, 2020. 

In January 2020, Arizona State Mining Inspector concluded the Company met all criteria required to commence operations on the Bonanza Mining Project. Tombstone has completed all steps of the permitting process and is awaiting the approval of the final necessary permit to begin construction. Extensive exploration of the property has revealed significant gold and silver reserves, as previously described in the April 15, 2020 press release.

This letter states, “The Reclamation Plan submittal for the Bonanza Mining Company - Harquahala Mine Project operation has been found to meet the applicable requirements of the Mined Land Reclamation Act and the Rules and plan approval criteria as established under A.R.S. Title 27, Chapter 5, 27-971. The site is located approximately 8 miles south of Salome, La Paz County, Arizona, within Sections 15, 16, 21-23, 27 and 28, Township 4 North, Range 13 West, of the Gila and Salt River Baseline and Meridian. The site is accessed via Harquahala Mine Road and Hovatter Road from Interstate 10.”

In February 2020, The Company announced the Arizona Department of Environmental Quality (ADEQ) proposes to issue an Aquifer Protection Permit (APP) for the subject facility that covers the life of the facility, including operational, closure, and post-closure periods unless suspended or revoked pursuant to Arizona Administrative Code (A.A.C.) R18-9-A213. The requirements contained in this Permit will allow the permittee to comply with the two key requirements of the Aquifer Protection Program: 1) meet Aquifer Water Quality Standards (AWQS) at the Point of Compliance (POC); and 2) demonstrate Best Available Demonstrated Control Technology (BADCT). BADCT’s purpose is to employ engineering controls, processes, operating methods or other alternatives, including site-specific characteristics (i.e., the local subsurface geology), to reduce discharge of pollutants to the greatest degree achievable before they reach the aquifer or to prevent pollutants from reaching the aquifer.

Best Available Demonstrated Control Technology (BADCT):

Facilities regulated by this permit shall be designed, constructed, operated, and maintained to meet requirements specified by A.R.S. §49-243(B) and A.A.C. R18-9-A202(A)(5).

Heap Leach Pad:

Heap leaching is an industrial mining process used to extract precious metals and other compounds from ore using a series of chemical reactions that absorb specific minerals and re-separate them after their division from other earth materials. Similar to in situ mining, heap leach mining differs in that it places ore on a liner, then adds the chemicals via drip systems to the ore, whereas in situ mining lacks these liners and pulls pregnant solution up to obtain the minerals. Heap leaching is widely used in modern large-scale mining operations as it produces the desired concentrates at a lower cost compared to conventional processing methods such as flotation, agitation, and vat leaching.

This facility will cover an area of approximately 314,000 square feet, and contain approximately 242,000 cubic yards of existing gold bearing ores and tailings. The ore and tailings will be consolidated into controlled areas prior to being sized and placed on the lined leach pad. The liner system for the leach pad shall be placed on 6 inches of prepared subgrade. The bottom liner shall consist of 30-mil scrim laminated low-density polyethylene (LDPE) with LDPE film geomembrane that is equivalent to 60 mil HDPE geomembrane. The upper liner shall consist of an ultra violet (UV) resistant 45-mil double scrim high-density polyethylene (HDPE) with LDPE coating geomembrane. A uniaxial geonet shall be placed between the two liners. The liners shall be secured around the perimeter of the leach pad in an anchor trench that is 2 feet wide and 2 feet deep. A minimum of 18 inches of ¾-inch minus drain rock shall be placed on upper liner. To promote pregnant solution transfer, 3-inch and 6-inch perforated collection pipes will terminate adjacent to the 12-inch pipe, and solution will pass through the drain rock and into the 12-inch collection pipe. Two 12-inch HDPE perforated pipes shall be located in a solution collection channel near the center of the leach pad to convey solutions to the Pregnant Solution Pond. A containment berm shall be constructed 12 feet from and 2 feet higher than the adjacent toe of the leach pad. The containment berm shall be capable of containing run off a 100-year, 24-hour storm and solution drain down and routing the fluids to the Pregnant Solution Pond. Liquid collected in the containment berm will flow by gravity over the double-lined liner system before cascading over this double liner system into the pregnant solution pond. Surface water run-on shall be collected in channels capable of handling stormwater from a 100 year, 24-hour storm event and diverted around the facility. The finish grade (maximum elevation) of the heap leach pile shall not exceed 1,760 feet above mean sea level (AMSL).

Pregnant Solution Pond:

This facility shall be located adjacent to the west side of the Heap Leach Pad. Pregnant solution shall be collected in a double-lined pond having a capacity of 4,126,239 gallons including 2 feet of freeboard. The liner system for the lead pond shall be placed on 6 inches of prepared subgrade overlaid by 6 inches of geosynthetic clay liner. The bottom liner shall consist of 30-mil scrim laminated LDPE with LDPE film geomembrane that is equivalent to 60 mil HDPE geomembrane. The upper liner shall consist of an UV resistant 45-mil double scrim HDPE with LDPE coating geomembrane. A uniaxial geonet shall be placed between the two liners. The liners shall be secured around the perimeter of the pond in an anchor trench that is 2 feet wide and 2 feet deep. An LCRS sump shall be constructed between the two liners near the southeastern portion of the pond. The LCRS shall be equipped with a dedicated, automatic, fluid-level activated pump capable of pumping 15,500 gallons per day. Surface water run-on shall be collected in channels capable handling stormwater from a 100 year, 24-hour storm event and diverted around the facility.

Compliance with Aquifer Water Quality Standards (AWQS):

To ensure that site operations do not result in violation of Aquifer Water Quality Standards, the point of compliance well located 200 feet west of the Leach pad shall be sampled and analyzed for the parameters listed in Section 4.2, Table 4.2.4 in the permit. Facility inspection and operational monitoring shall be performed on a routine basis in Section 4.2, Table 4.2.1, in the permit for the Pregnant Solution Pond and the Heap Leach Pad.

Recent Developments on Operations:

In 3rd quarter 2019, the Bonanza Mining Company (Joint Venture Company) (Bonanza) identified that their permitting engineers, CDM Smith, submitted the Air Quality permit on July 2nd and received a determination of completeness letter the same day. The completeness determination effectively starts the clock for air permit engineering review with expectations of completing the air permitting in November 2019.

The Arizona Department of Environmental Quality (ADEQ) received the required Aquifer Protection Permit (APP) for the Bonanza Mining Company. The Department considered the application administratively complete on August 12, 2019.

February 27, 2020, the Company announced the ADEQ received the mandatory cash deposit for financial assurance for the approved cost estimate in the amount of Two hundred and Eight Thousand, Five Hundred and Fourteen dollars ($208,514) for the Aquifer Protection Permit for the Harquahala Mine Permit.

On April 15, 2020, the Company announced that it had received the final permit necessary to launch construction, and shortly after, active gold production at the Harquahala Mine. The ADEQ specifically authorized Bonanza Mining Company to “operate the Harquahala Mine, a gold mine located in an unincorporated area 8 miles south of the Town of Salome, La Paz County, Arizona” based on the issuance of AQUIFER PROTECTION PERMIT NO. P-512944, which will remain effective for the life of the facility.

The issuance of this permit allows for the construction of a 242,000 cubic yard heap leach pad and a 4,126,239 gallon double-lined pregnant solution pond, where consolidated historic ores and tailings at Harquahala will be subject to gold extraction through conventional cyanide leaching.

The initial portion of the Phase One leach pad is expected to accommodate 500,000 tons of already mined material that have been tested to show upwards or more of 26,000 - 50,000oz of gold.

Further, on April 21, 2020, the Company provided an update as to the status as construction begins.

On May 20, 2020, the Company announced the execution of a contract with 5D Mining & Construction, Inc. (“5D”) for the building of the heap leach pad for the Bonanza Harquahala Mine. Phase One construction of the Bonanza Heap Leach Project is anticipated to start on or about May 25, 2020, with full project completion expected by mid-September. Per the contract, 5D will supply labor, equipment and materials to perform all of the civil work and liner installation for phase one. Phase Two, currently under consideration, includes a much bigger package where we have potentially identified 150,000 – 300,000 oz of Au in defined underground targets in and around the old Harquahala mine with significant upside potential. The 5D contract for construction for this first phase of the Bonanza Heap Leach Project includes all survey work required for layout and grading, debrushing the work area, demolishing obstructing concrete structures, relocating and stockpiling the existing tailings, mass grading for the PLS pond and leach pad, all trenching and backfill for the liner anchor trench, fine grading for the liner, installation of the liner and perforated drain pipe, including required support work.

In June 2020, the Company announced construction has begun on the leach pad at the Harquahala Mine in La Paz County, Arizona. The 5D Mining and Construction Company effectively grubbed and staked the whole pad area and was halfway through the excavation of the leach pond by end of June 2020. The completion of the construction phase is on track for completion by the end of the summer and production will commence immediately after that.

2021 updates:

In February 2021, the Company announced that construction of the pad is complete with the finish of the liner installation. Field Lining Systems Inc. were able to complete the liner install and the final report will be sent to the Arizona Department of Environmental Quality. Crushing material and laying of the 18-inch liner protection layer has started using low grade material from the south side of the mine area. Stacking will commence towards the end of next week with completion of laying the protection layer and leaching will commence shortly thereafter. The carbon columns required for gold recovery are now set-up with all piping and electrical installation to be completed this week. The cyanide tank was also delivered and is being set-up and prepped for production. The long-awaited water well has been drilled to 706 feet and produces approximately 310 gallons per minute; the well however will potentially produce twice this amount of water. The pipeline and well pumps are being installed and should be ready to pump water towards the end of next week. Items such as the office trailer and storage are in transit to the location.

In April 2021, the Company announced approximately 25,000 tons of rock have been crushed to the appropriate size; the crushing is a precursor to stacking. The crushed rock is the highest known gold grade material on the site and will allow for a quick start to leaching and recovery.

An agglomerator for ore agglomeration was located approximately four weeks ago and moved to site and set-up for operation. All ore feeding equipment, conveyors, cement silo, stacker and feeder will be put in place early this week with electrical being installed shortly thereafter. The agglomerator was the final piece of equipment needed at the site and agglomeration and pad stacking will start towards the end of the week.

The leach pad and all of the associated piping and processing equipment have been installed. Final electrical installation will be completed this week. Testing of the pumps and equipment will take place early in the week with no problems expected. The water well was finished and provides well over 250 gallons per minute. The water infrastructure is in place and water is now being provided to the Harquahala site through our permitted pipeline system. An automated water filling system for the onsite tank is being installed. All cyanide related infrastructure is on site and in place. An office trailer has also been placed on site for administrative functions.

The Bonanza Mine was completely built out and commenced production June 3, 2021, when the pH levels increased to allow for safe sustained leaching. Approximately 35,000 tons of rock have been placed on the leach pad with the entire area under leach. Carbon has been placed in all four carbon columns and is collecting gold & silver from solution. Bonanza expects to ship its first carbon in approximately two weeks depending on how fast the rock leaches and how quickly the carbon loads.

In July 2021, the Company announced first results were received from production in June that started at the Bonanza Harquahala Mine. Production of 83.7 oz of Dore was stripped from the Bonanza’s activated carbon by Metals Research and sent to Metalore Inc. for final disposition. First payment from the Dore is expected during the week beginning on July 12, 2021.

In August, 2021, the Company announced the second pour from production of 262.59 oz of Dore was stripped from the Bonanza’s activated carbon by Metals Research and sent to Metalor USA Refining Corp. for final disposition. This is more than a 300% increase from the 83.7 oz of Dore from the first pour announced on July 13, 2021. At or around July-August 2021, the price of gold remained stable and strong at the price $1,780/oz.

In October 2021, the Company announced the third pour production of 210 oz of Dore stripped from the Bonanza’s activated carbon by Metals Research and sent to Metalor USA Refining Corp. for final disposition. 

2022 updates:

In January 2022, the Company announced that as of the end of January 2022 the processing facility at the Bonanza Harquahala Mine will be operating 24/7. Between July 2021 and January 2022, the Company and the Bonanza Mining Corporation had six successful pours of gold and silver since starting its Heap Leach Operation in Arizona, July 2021, and work is continuing to build the much bigger operation going into 2022. The crushing contract has been awarded to DV Gravel and Exploration of Eureka, NV. DV Gravel has begun to move their equipment to site. Conveyors and dozer have arrived on site, and the remaining equipment is to be transported this week and ready to start. The site preparation for the crusher and set up to follow. We will start the rock crushing and expect to be putting 25,000 tons monthly of rock on the pad over the next three months and then increasing to 50,000 tons per month

In March 2022, the Company announced its first ore shipment in 2022 with approximately five tons of carbon that carried the Gold and Silver to Metals Research in Kimberly, Idaho for final processing of the minerals. The results of the processed material from March 17, 2022 produced 341.98 oz of ore which delivered 70.42 oz of Au and 63.77 oz of Ag. 

In April 2022, the Company announced its second shipment in 2022 of approximately five tons of carbon that carried the Gold and Silver to Metals Research in Kimberly, Idaho for final processing of the minerals. The results of the processed material from April 7, 2022 produced 456.80 oz of dore which delivered 83.34 oz of Au and 78.66 oz of Ag.

In May 2022, the results of the third shipment on May 3, 2022 of processed material produced 303.85 oz of dore which delivered 65.96 oz of Au and 58.51 oz of Ag. 

Stardust Project.The Stardust Mine, Yuma County Arizona, Eagletail Mining District

LOCATION: Yuma County, Arizona (Eagletail Mining District)

OWNERSHIP: 100% Tombstone

MINERALS: Gold, Silver, Copper and Molybdenum

PROPERTY SIZE: 400 acres

The Company holds the mineral rights to approximately 400 acres of BLM lode claims which includes the Stardust Mine in Yuma County Arizona, the Eagletail Mining District. Exploration work began on the property starting in October 1, 2015. The Stardust Mine is a disseminated Gold Property.

Tombstone holds US Federal unpatented lode claims over the Stardust project area. Tombstone has staked these claims by locations.

Stardust Project, Yuma Co AZ: 100% interest in 20 unpatented federal lode claims found within Sections 1,2, T2S,R11W, Yuma County, Arizona, USA.

Stardust claims acquired by staking of lode claims. Surface and mineral rights are authorized under United States locatable mining rights - The General Mining Law of 1872. An annual Maintenance fee system under which federal claims are held is established by section 314 of the FLPMA (43 USC 1744 and 43 CFR 3833).

The current lode claims “Star1 – Star20” held from dates:

•Location date of Claims Star1 thru Star4 - located Star4 May 19, 2015 to Sept 1 2019. 

•Location of Claims Star5 thru Star20 - located Sept 12th,2015 to Sept 1st 2019. 

•Stardust claims (Star1 –Star20) are United States federal unpatented lode claims. 

•Stardust project is an Exploration project. 

•Project name: Stardust 

•Claim names: Star1 through Star20 

•List of claims at Stardust project included in below compiled listing of Stardust project claims: 

These claims can be found recorded in the Phoenix BLM system and accessed through the online LR2000 system found at: https://www.blm.gov/lr2000/

See attached Stardust Project maps:

•A State scale map titled “Tombstone Exploration Corporation, State Index map & location of Stardust project.” – This map shows an inset US map, as well as a larger scale Arizona map showing relative position of the Stardust project area within the State. 

•A regional scale map titled:“Regional Access Map – Stardust Project – Tombstone Exploration Corp.” with the Stardust claims, county, Interstate, and regional urban areas displayed, as well as 100k scale USGS topographic background.

•A project scale map plotted at 1” = 1000’ - Map Titled “Tombstone Exploration, Stardust claims, Yuma Co.”shows the Stardust project area and lode claims held by Tombstone Exploration Corporation. Additionally, a USGS quadrangle 7.5 minute background image is present within the map showing planimetric, topographic features, and roads within and outside the project area. 

An Application to conduct exploration trenching and drilling on the Stardust Claim block was received by the Bureau of Land Management on March 18, 2016. This work program started mid 2017 subsequent to the Company’s Reclamation Bond’s acceptance by the US Bureau of Land Management on May 17, 2017. Prior to May 2017, the Company’s Notice Application to conduct exploration drilling plan was accepted. The Company has engaged Harris Exploration Drilling and Associates, Inc., a Nevada company, to commence drilling on the Stardust Claim.

This property lies along the northern flanks of the Gila Bend Mountains, which are underlain by Precambrian schist and granitic rocks of probable Cretaceous age, uncomformably overlying and intruding the older rocks are Tertiary volcanic rocks.

The geology of the Stardust claims is dominated by three types or phases of granitic rocks. The age of the intrusive rocks is probably Cretaceous, but they could be Precambrian or mid-Tertiary; we currently believe they are most likely to be Cretaceous. Ninety-five percent of the mapped area is encompassed by granitic rocks. The other five percent is divided evenly between Precambrian chlorite schist and mid-Tertiary andesite dikes.

The granitics are subdivided into three units. They may all be related to the same magma or be of different ages or a combination of the two. All three are easily identifiable in the field bases on their megascopic characteristics. The first and most abundant unit is leucocratic granite. It is white in color, fine to medium-grained, and does not contain mafic minerals. The presence of chlorite is almost ubiquitous in the leuco-granite, and occurs mainly along fracture surfaces. Chlorite is probably an alteration product associated with fracturing and/or mineralization. The second granitic unit is quartz monzonite. It forms the main portion of South Hill (see Plate 1). It is equigranular and contains hornblende and biotite. Narrow (1-3) silicified and brecciated zones are hosted by this unit; and are commonly anomalous in gold. The third unit is also quartz monzonite in composition, but contains anhedral pink feldspars which distinguish it from the other two units. Alteration and mineralization are completely lacking in this unit.

Chlorite schist crops out at three localities which average about 50-75 feet in width and 300 feet in length. The schist unit is a roof pendant and probably continues at depth for only a few hundred feet. The age of the chlorite schist is probably Precambrian, based on its resemblance to other Precambrian schist units in western Arizona. Mineralization does occur within the schist, generally near andesite dikes.

The andesite dikes crop out as narrow (5-10 feet), sinuous bodies and crosscut the leucogranite and chlorite schist. Intrusion of the dikes is tentatively dated as Oligocene to early-Miocene. In the north-central position of the mapped area, the andesite seems to “blossom” into a stock-like body with minimum dimensions of 100 feet by 400 feet; see section B-B’, Plate 3 for configuration. Strike direction of the dikes varies from east-west to N70 degrees West and dips average 70 degrees to the North. Alteration of the andesite consists of silicification, brecciation, and iron-oxides; however, some andesite is devoid of alteration, especially in the eastern portion of mapped area.

Due to the paucity of outcrop on the property, structures were difficult to define. In a broad sense, the entire mapped area has been intensely fractured along an east-west structure, this fracturing is at least a ½ mile in length and 300-500 feet in width. The zone could be much wider, but colluvium to the north covers any extension.

Gold and silver mineralization with copper occurs along an east-west trend and is spatially related to an andesite dike. The dike is variably silicified and iron-stained. Silicification consists of silica replacement and drusy quart crystals in open-space veins. Hematite staining and vein fillings are commonly associated with gold.

On November 25, 2015, Zonge International completed ground geophysics across the 400 Acre claim block owned by Tombstone in the Eagletail Mining District, Yuma County, Arizona. Zonge has been well respected for geophysical data acquisition in the minerals industry since 1970. They are an industry leader in methods such as IP (induced polarization) and CSEM/AMT, as well as SP, seismic, and gravity/magnetic data acquisition. 

Zonge has performed a ground magnetic survey across the claim block to determine the extent of the Stardust Fault. Previous reports state that the two shafts on the property were sunk along a high angled structure which trends E-NE across the area of outcrop. This structure is thought to be the ‘feeder’ for the Gold Silver mineralization in the project area. Several reports reference ‘free milling gold’ from drifts along this fault. Abundant dump material contains anomalous gold and silver values as well as visible copper oxides. Due to the extensive surface disturbance in this area, performing a ground magnetic survey will give a better understanding of the subsurface character of the fault. This method details changes in density in the subsurface and is used to define faults, fractures, and changes in rock types. As a result, this geophysical data will be used to better define the Phase I scope of work, which will involve detailed surface mapping, rock/soil sampling, and delineation of drill targets.

The Stardust property has two shafts on this property that are secured with wire fencing. We have not entered either of these shafts at this time. There has been minimal surface disturbance on this property and we are not aware of any trenching, mine dumps, ponds or any contaminations released by former processing or assay/testing activities. 

The encouraging results from the rock sampling program over the Stardust project indicate the presence of a high angle detachment related precious metals vein system. The mineralization present at the Stardust project appears to be located within detachment related veins & locally intensively chloritic and hematitic host rocks. The vein system has been sampled over a strike of approximately 3,200 feet (975 meters). These veins appear to be a feeder system of an extensive partially eroded low angle fault system over the Stardust.

The results of the latest tranche of rock samples combined with field observations, and existing data, appear to fit the USGS detachment fault model of USGS Bulletin 2004 by Long, K.R.: Preliminary Descriptive Deposit Model for Detachment-Fault-Related Mineralization. Other productive detachment fault related precious and base metal systems occur through the Basin and Range areas of Southern California, Western Arizona, and Southern Nevada. An example in Arizona includes the Copperstone Mine, previously mined by Cypress which produced one half million ounces of gold by open pit methods from 1987-1993. Copperstone is currently being evaluated for additional resources.

Quartz veins are present in outcrop, subcrop, float, & in historical mining dumps. In addition to these strong precious metal values found in samples, additional observations at Stardust include:

Footwall host rocks are a metasediment matrix with strong hematite & intensive chloritic alteration + copper oxides.

The Property is without known Reserves and the property is exploratory in nature based on prior work on this property over many years.

The current service on this claim block has disturbances of which has been identified in our exploration plan previously filed with the BLM. Any further surface disturbance from the result of our Exploration Work that has been filed with the Bureau of Land Management will be required to be remediated.

Stardust Mine Events for years ended December 31, 2017 and 2018:- 2021:

•As announced on May 30, 2017, the Company’s Reclamation Bond was accepted on May 17, 2017, by the BLM, and prior to this, the Notice Application to conduct exploration drilling plan was accepted. The Company has engaged Harris Exploration Drilling and Associates Inc. (Harris Drilling), a Nevada company to commence drilling on the Stardust property the first week of June. Harris Drilling has been in business for over fifty years and has worked for many of the top mining and exploration companies in the world. This first phase drilling program is designed to establish strike length and test grades over a large enough width within the defined chlorite hematite hosted vein system. The drilling will attempt to define structural continuity (vein continuity along strike), grade of veins and hosting chl-hem zone, and find the width of structures. The program, as designed, should also demonstrate grade at reasonably shallow depths. The lowest drilling angle -45 degrees is envisioned for this program. This phase will include approximately 3000 ft of drilling. The mineralization present at the Stardust Project appears to be located within detachment related veins hosted by intensively chloritic and hematitic host rocks. The vein system has been sampled over a strike of approximately 3200 feet (975 meters). These veins appear to be a feeder system of an extensive partially eroded low angle fault system regionally present.  

•As announced on July 5, 2017, the first two holes Core(HQ) of drilling were completed. The first hole (SDD1) was completed at a depth of 350 ft and the second hole (SDD2) was completed at 290ft at the 100% owned Stardust claim block located in Yuma County, Arizona. This first drill program is expected to drill 6–8 holes totaling 3000 ft. The Stardust drilling campaign is targeting an epithermal precious metals (gold, silver ) system. Harris Exploration Drilling and Associates Inc. (Harris Drilling), a Nevada company, commenced drilling on June 10th. The core samples from the first two holes were delivered to Skyline Assayers and Laboratories in Tucson, Arizona on July 3rd. The samples will be crushed and pulverized with standard steel and then proceed to be fire assayed for Gold and a 24 multi-element Geochemistry for Silver and multiple other trace elements. This first phase drilling program is designed to establish strike length and test grades over a large enough width within the defined chlorite hematite hosted vein system. The drilling will attempt to define structural continuity (vein continuity along strike), grade of veins and hosting chl-hem zone, and find the width of structures. The program, as designed, should also demonstrate grade at reasonably shallow depths. The lowest drilling angle -45 degrees is envisioned for this program. 

•As announced on August 30, 2017, the third and fourth holes Core(HQ) of drilling were completed by Harris Drilling and Associates Inc. on July 26, 2017. The third hole (SDD3) was completed at a depth of 175 ft and the fourth hole (SDD4) was completed at 293 ft at the 100% owned Stardust claim block located in Yuma County, Arizona. Phase 2 drilling is scheduled for September. The Stardust drilling campaign is targeting an epithermal precious metals (gold, silver) system. The core samples from the third and fourth holes were delivered to Skyline Assayers and Laboratories in Tucson, Arizona, on July 28th. The samples will be crushed and pulverized with standard steel and then proceed to be fire assayed for gold and a 24 multi-element Geochemistry for silver and multiple other trace elements. 

This first phase drilling program is designed to establish strike length and test grades over a large enough width within the defined chlorite hematite hosted vein system. The drilling will attempt to define structural continuity (vein continuity along strike), grade of veins and hosting chl-hem zone, and find the width of structures. The program, as designed, should also demonstrate grade at reasonably shallow depths. The lowest drilling angle -45 degrees is envisioned for this program.

Holes 3 and 4 are designed to test projection of gold mineralization in outcrop veins and silicification found just NE of one of the original shafts on the property. We look forwarding to receiving and reviewing the assay results and sharing with our shareholders, as there have been multiple locations of veins throughout the core that we have sent for assay.”

•As announced on December 5, 2017, Nine RC drill holes totaling 5000’ were completed at the Stardust project in November. Drilling focused mostly on the western half of the property with -45 degree inclined holes. The main Stardust Mine structure, which strikes just north of due east, and secondary NE fault splays on its north side were primary targets. Drill holes across these structures consistently intercepted intervals of quartz veining, strong silicification, and associated iron oxide minerals, all prospective for gold-silver mineralization. Wall rocks to the veins included propylitically altered monzonite intrusive, meta-volcanic, and meta-sedimentary rocks. Most of the 2017 drilling occurred in an area of thin (25-90’) gravel cover created by downward offset on the N and NW sides of E-W and NE structures. Blind structural drill targets were partly resolved with the 2015 Zonge Engineering ground magnetic data, and partly discernible from detailed air photos and geologic mapping. Though the gravel contains angular fragments of gold-silver bearing, banded epithermal quartz vein material, it hindered historic development work at Stardust during the 1920’s, by obscuring in place quartz veins. 

The overall Stardust epithermal system appears differentially eroded from east to west. East of the historic mine shafts, exposures are good. Rock chip gold-silver results improve nearer to the historic Stardust mine shafts, which are located in a central corridor where the precious metals zone is better preserved from erosion, but incompletely covered by gravel. Drill holes SDR 5 and 6 tested this corridor. Drill holes SDR 7 through SDR 13 targeted quartz veins beneath gravel cover up to 300’ north and 1500’ west of the historic shafts. These holes encountered the strongest quartz vein intervals, up to 55’ thick. Quartz vein intervals were encountered through a depth range from just below the gravel cover to downhole depths up to 615’, suggesting good preservation of the precious metals zone at depth. About 1300’ west of the Stardust shaft, a prominent NE structure further down-drops tertiary volcanic rocks into fault contact with older intrusive and metamorphic rocks that host the known quartz veins. SDR 12 was collared in the hanging wall of this structure and encountered a thicker gravel sequence, tertiary volcanic rocks, and quartz veining at the fault contact between the tertiary volcanic rocks and pre-tertiary basement rocks, as well as additional quartz veins and silicification in the basement rocks. Strong alteration and structurally-controlled quartz veining continue to the western extent of the 2017 drilling, leaving the Stardust epithermal system open to the west and potentially still strengthening to the west. This drill program clearly shows the Stardust project contains an epithermal alteration system much larger and stronger than indicated by the restricted historic workings and surface exposures and requires further drilling to determine its size. The strength and extent of quartz veining and silicification observed during the drill program suggest excellent potential for significant gold and silver results. All 1000 samples are presently at Skyline Assayers and Laboratories in Tucson, Arizona. Results are expected in 4-6 weeks.

In summary, the recently completed 9-hole drill program at Stardust has successfully confirmed the presence of quartz veins outside of previously tested areas at the Stardust property. The drilling identified strong quartz vein structures along the trend for over 1500 feet west of the historic Stardust shafts. Drilling encountered quartz veins and metallic mineralization in the area outside the historic underground workings. This suggests that there could be additional precious metal resources in known structures west of the historic mines.

•As announced on February 8, 2018, the Company announced the results from the phase two drill on the Stardust GoldTombstone Project as follows. Tombstone Exploration completed 13 holes totaling 6200’ at the Stardust project in 2017. Drilling focused mostly on the western half of the property with -45degree inclined holes. The main Stardust Mine structure, which strikes just north of due east, and secondary NE fault splays on its north side were primary targets. Drill holes across these structures consistently intercepted intervals of quartz veining, strong silicification, and associated iron oxide minerals, all prospective for gold-silver mineralization. Wall rocks to the veins included propylitically altered monzonite intrusive, meta-volcanic, and meta-sedimentary rocks. Most of the 2017 drilling occurred in an area of thin (25-90’) gravel cover created by downward offset on the N and NW sides of E-W and NE structures. 

The overall Stardust epithermal system appears differentially eroded from east to west. East of the historic mine shafts, exposures are good. Rock chip gold-silver results improve nearer to the historic Stardust mine shafts, which are located in a central corridor where the precious metals zone is better preserved from erosion, but incompletely covered by gravel. Drill holes SDR 5 and 6 tested this corridor. Drill holes SDR 7 through SDR 13 targeted quartz veins beneath gravel cover up to 300’ north and 1500’ west of the historic shafts. These holes encountered the strongest quartz vein intervals, up to 55’ thick. Quartz vein intervals were encountered through a depth range from just below the gravel cover to downhole depths up to 615’, suggesting good preservation of the precious metals zone at depth. About 1300’ west of the Stardust shaft, a prominent NE structure further down-drops tertiary volcanic rocks into fault contact with older intrusive and metamorphic rocks that host the known quartz veins. SDR 12 was collared in the hanging wall of this structure and encountered a thicker gravel sequence, tertiary volcanic rocks, and quartz veining at the fault contact between the tertiary volcanic rocks and pre-tertiary basement rocks, as well as additional quartz veins and silicification in the basement rocks. Strong alteration and structurally-controlled quartz veining continue to the western extent of the 2017 drilling, leaving the Stardust epithermal system open to the west and potentially still strengthening to the west. To date all drill results had lower grade gold than expected on this small area of drilling. Tombstone has drilled through incredible large quartz vein intercepts with this drill campaign and nearly every section sent for assay carried gold, leaving Tombstone highly optimistic on identifying greater quantities on the remaining 396 acres of the Stardust Property.

In addition to the gold assays Tombstone also had its lab prepare Analysis of 29 additional elements which included lithium. There were interesting lithium numbers in all the drill holes of which we did not expect. Although the lithium numbers are also considered low grade it will now be added to our exploration plan. Lithium is hosted in a pregmatite composition that is similar to granite with abundant quartz. The third phase drill area has a number of pregmatite outcrops of which we will be included in our next drill targets.

The first two phases of drilling were designed to establish strike length and test grades over a large enough width within the defined chlorite hematite hosted vein system. The drilling was to define structural continuity (vein continuity along strike), grade of veins and hosting chl-hem zone, and find the width of structures.

. The State of Main Mine and others as well as Section 16 of the Tombstone Mining District Copper Exploration, Cochise Count,County, Tombstone Arizona

LOCATION: Tombstone, Arizona

OWNERSHIP: 100% Tombstone

MINERALS: Gold, Silver and Copper

PROPERTY SIZE: 641 acres

The Property is without known Reserves and the State of Main Mine is exploratory in nature based on prior work completed on this property over many years. There are multiple areas that were worked on the State of Maine Mine from the 1930’s, they have been described in many reports that previous geologists have rendered that are historic in nature. Most of this work was completed underground and access was through mine shafts and decline entrance ways. We have not completed any work in the interior of this property. We have not encountered any previous contamination on these properties related to former processing or assay testing activities. 

The Company holds the mineral rights to approximately 640 acres in the historical western Tombstone silver mining district. Our property area lies within the historic Tombstone Mining District Cochise County, Arizona. The town of Tombstone, Arizona is approximately 70 miles (miles, 110 kilometers (km)) southeast of Tucson and 24 miles (40 km) northwest of Bisbee, Arizona. The San Pedro River lies about 2 miles (3 km) west of the property’s westernmost boundary.

The Tombstone mining district is one of 12 mining districts in Cochise County, Arizona. Copper, lead, zinc, silver, and gold were the principal metals produced from the different mines in the County. Management has structured and positioned the Company to capitalize on today'stoday’s increasing demand and prices for precious metals and base metals such as copper, lead and zinc.

The Tombstone property is composed of three non-contiguous parcels totaling approximately 640 acres. The parcels consist of 8 patented lode claims totaling 145.6 acres (58.9 ha), in Section 16, and 1 Arizona State Land Department (ASLD) exploration permits totaling 495 acres. The Company owns the mineral rights to the patented claims; the surface rights are owned by various individuals. The Arizona state trust lands exploration permits grant the Company the exclusive exploration rights for up to 5 years from the date the exploration applications were filed. Surface and mineral rights are variously owned by the U.S. federal government, the State of Arizona, and individual persons.

In addition to continuing to explore our current mineral rights, we will seek outTombstone has conducted multiple sampling and attempt to acquire new properties.

B. Business Overviewdrill programs on Section 16 in prior years. A prior sampling program on Section 16 included 115 samples that had high gold and silver assays. The results include rock samples collected from outcrops, mine dumps, trenches, and underground workings. The two highest samples returned assayed values of 609.50 ounces per ton (opt) of Ag (silver), 0.396 opt Au (gold) and 81.70 opt Ag and 0.180 opt Au. The highest of these samples, sample 49373, was a selected sample collected from the Santa Ana mine (Joseph Vein) workings at the 18-meter level across a 10 cm. wide fault. An earlier selected high grade sample collected from the 10-meter level of the Santa Ana mine (Joseph Vein), sample SA 35-0, assayed 971.40 opt Ag, 0.335 opt Au across a 5 cm. width.

This business generally consists of three stages: exploration, development and production. We areA detailed NI 43-101 was completed on this property by SRK Consulting along with a mineral resource company inZTEM Report by Geotech. Ltd based on Helicopter-Borne Electromagnetic Geophysical survey on the exploration stage because we have not yet found mineral resources in commercially exploitable quantities, and are engaged in exploring land in an effort to discover them. Mineral resource companies that have located a mineral resource in commercially exploitable quantities and are preparing to extract that resource are in the development stage, while those engaged in the extraction of a known mineral resource are in the production stage.

Mineral resource exploration can consist of several stages. The earliest stage usually consists of the identification of a potential prospect through either the discovery of a mineralized showing on thatTombstone property or as the result of a property being in proximity to another property on which exploitable resources haveconducted for Tombstone Exploration Corporation. A significant Porphyry copper system has been identified whether or not they are or have in the past been extracted.

After the identification of a property as a potential prospect, the next stage would usually be the acquisition of a right to explore the area for mineral resources. This can consist of the outright acquisition of the land or the acquisition of specific, but limited, rights to the land (e.g., a license, lease or concession). After acquisition, exploration would probably begin with a surface examination by a prospector or professional geologist with the aim of identifying areas of potential mineralization, followed by detailed geological sampling and mappingthat encompassed Section 16 of this showing with possible geophysical and geochemical grid surveys to establish whether a known trend of mineralization continues underground, possibly trenching in these covered areas to allow sampling of the underlying rock. Exploration also commonly includes systematic regularly spaced drilling in order to determine the extent and grade of the mineralized system at depth and over a given area, as well as gaining underground access by ramping or shafting in order to obtain bulk samples that would allow one to determine the ability to recover various commodities from the rock. If minerals are found, exploration might culminate in a feasibility study to ascertain if the mining of the minerals would be economic. A feasibility study is a study that reaches a conclusion with respect to the economics of bringing a mineral resource to the production stage.

Operationsdistrict.

The Company has conducted several drilling programs on the Tombstone property, as described in greater detail below.

2007 Drilling Program

In early March 2007, we commenced our reverse circulation (RC) drill program. On or about March 21, 2007, we completed the first reverse circulation drill hole (RT-1) to a depth of 500 feet and intercepted silver/gold mineralization when it hit its target at the Tombstone property.

The 2007 Drill Program consisted of distinct drill sites that were designed to intercept extensions of the State of Maine mine, Merrimac zone, Bonanza-Solstice mines and the Ace-in-the-Hole-Black Horse mine sub-parallel trends. These zones are north-easterly trending. Core holes were HQ size and were drilled using triple tube core technology to assure that the most complete core recovery was achieved. Drill hole spacing was approximately 100 meters between drill hole sites. The four mineralized zones were tested over strike lengths ranging from 200 meters to 500 meters. All available historical data indicates that there were no historical mining activities conducted below the water level in the areas covered by the 2007 Drill Program.

Following the 2007 Drill Program, in January 2008, the Company received assay results for 115 samples taken from its Tombstone Project property within T20S R22E Sections 16 and 17. It was determined that more detailed sampling would be required to further assess the Santa Ana Mine workings.

2008 Drill Program – Phase 1

On or about April 1, 2008, the Company began to conduct geological mapping and sampling that, combined with historical data, provided the basis for the 2008 core drilling program.

On May 29, 2008, the Company engaged Layne Christensen Company (NASDAQ: LAYN) of Mission Woods, Kansas to conduct its 2008 drilling program, which commenced on June 17, 2008 and continued through September 2008.

On October 9, 2008, the Company announced the completion of its 2008 Drill Program which consisted of 2,593 feet of core drilling at its silver project in Tombstone. Six diamond drill holes (DDH) were drilled, TEMC 101,102,103,104,105 and 106, to test the extension of the mineralization zones of the Bonanza and Santa Ana structures, both of which possess historical data from within the mining district. Both structures exhibit open ends at the south and north, as well down dip.

Holes were drilled as HQ diameter and using triple-tube technology, yielding a recovery over 90% in most instances. RQD is estimated at 45%, average.

Five out of the six DD holes intersected the projected targets at different levels at the south, central and north of the structures, while DDH TEMC 101 provided a great deal of information regarding the Bonanza structure which seems to be bent in an opposite direction in depth. This particular piece of information has been physically confirmed in the Bonanza mine workings where the structure becoming sub-vertical at 200 feet approximately, and then switches the dip to east, rather than dipping west as observed at the upper sectors of the shafts.

The 2008 Drill Program revealed a new mineralized structural corridor between the State of Maine and Merrimac veins at the southern portion of the property. The corridor extends for over one mile, and locally exhibits 80-100' width with some feldspar porphyry dikes in between.

The results of this Phase 1 drill program have resulted in identifying a mineral zone that the Company’s management believes is a significant precious metals and base metals discovery. The Company intends to carry out an aggressive exploration and comprehensive drilling program.

Following the completion of the Phase 1 Drill Program in 2008, the Company receivedassay results from rock chip samples on its Tombstone properties. Outcrop samples taken from horizontal projections of mineralized structures away from historical mine workings indicate continuity of silver, gold, lead, zinc, copper and manganese minerals along these structural corridors through the property package. Samples from two structures were collected and taken to Copper States Analytical Lab in Prescott, Arizona for gold, silver, lead, zinc, copper and manganese assays.

2008 Technical Report

In May 2008, we filed our initial Technical Report regarding the Tombstone property. SRK Consulting (“SRK”) of Tucson, Arizona completed the Technical Report. SRK is an independent, international consulting group, employing leading specialists in environmental science and mineral engineering. Its seamless integration of services, and global base, has made the company a significant international practice in due diligence, feasibility studies and confidential internal reviews. SRK's global experience and reputation for excellence is widely recognized among the major financial institutions and are repeatedly called upon to advise on and evaluate projects for all types of market transactions. Formed in 1974, SRK employs more than 600 professionals internationally in 31 permanent offices on 6 continents.

SRK made the following recommendations:

An extended program of vertical and inclined core drilling was recommended for the Tombstone Property. Drilling would be aimed at determining mineralization grades and fissure vein characteristics such as horizontal and vertical extent, relationships to other veins, widths and depths below the water table. It would also provide geotechnical information, samples for bulk density measurements, and samples for preliminary metallurgical testing. It is difficult to say how many drill holes would be indicated. A program is suggested that would include a minimum of five 1000-foot core holes along existing mineralized structural zones to define depth potential below the water table. A program of twenty 500-ft drill holes (RC) can be used to explore along strike of mapped extensions to known structures.

1.Conduct additional inclined and vertical drilling for the following purposes: 

•Evaluate the width of structural targets such as dikes, fissures, and veins; 

•Confirm silver mineralization across the targets; 

•Evaluate potential mineralization below the water table in the target areas; 

•Provide fresh samples for mineralogical and metallurgical testing; and, 

•Conduct in-fill and/or extension drilling where necessary.  

Any additional drilling should be by the core drilling methods with HQ size core. The drilling should include some oriented drillcore, targeting the northeast-trending fissures, to intercept the greatest possible thickness and depth of mineralized rock. Additional drilling should be directed toward evaluating mineralization below the water table.

The recommended drilling will provide additional structural and assay information to allow for possible delineation of mineralized zones, and will provide additional geotechnical information. Closer spaced drillhole definition of higher grade and thicker mineralization should be the goal.

2.Conduct down-hole surveys to measure drill-hole deviation, particularly for drill holes in excess of 100 m. 

3.Devise a suitable numerical drill log that will allow inclusion of detailed lithology, alteration and mineralization information, in numeric form, in addition to assay data, to allow for digital drill logs. 

4.Convert historical hard copy drill logs to digital format logs. 

2009/2010 Drill Program - Phase II

In February 2009, the Company extracted six additional samples from the Tombstone property which were sent to Copper State Analytical for assay for gold, silver, manganese, copper, lead and zinc. Three of the samples were taken from the State of Maine Mine and three from Randolph Mine, both located on the Tombstone property. The Company suspended the 2009 Drill Program due to general economic factors leading to difficulty in obtaining the requisite financing to fund the program.

In April 2010, the Company resumed the 2009 Drill Program, with the two targets drilled and both having intersected mineralized zones. The Company utilized a portable x-ray diffraction (XRF) machine to get on-site reading of metal levels in the drill cuttings. The results helped the exploration team manage the drilling program. Tombstone'sTombstone’s property is underlain by Uncle Sam porphyry and units of the Bisbee Group. Mineralized fissures strike consistently northeast, and many of the fissures exhibit consistent orientation for hundreds of feet along strike. Many fissures have parallel orientations, forming fissure sets. The main mines in this area occur along these northeast-striking fissures. The State of Maine mine occurs in fissures that cut both Bisbee sediments and Uncle Sam porphyry. These structural mineralized fissures are the primary focus of the current exploration program.

As of June 30, 2010, 4,080 feet of drilling had been completed. Also, during this period, additional geologist investigation was undertaken to further assess the potential for porphyry copper exploration targets on the Tombstone property. The Company has been in contact with geophysical contractors to develop a plan, budget and timeline for this phase of the project. Planning is on-going and work may include geochemical surveys as well.

The Company has not conducted further drilling on the Tombstone Property since June 2010. The State of Main mine is without known Reserves and the property is exploratory in nature based on prior work on this property over many years.

2010 Report on a Helicopter-Borne Z-Axis Tipper Electromagnetic (ZTEM) and Aero Magnetic Geophysical Survey

From June 29, 2010 to July 4, 2010, Geotech Ltd. carried out a helicopter-borne geophysical survey for the Company over the Tombstone project area. Principal geophysical sensors included a Z-Axis Tipper electromagnetic (ZTEM) system, and a caesium magnetometer. Ancillary equipment included a GPS navigation system and a radar altimeter. ZTEM was selected for its ability to achieve unparalleled resolution and depth of investigation. The system is well suited to imaging buried porphyry deposits and is capable of gathering data over 6,000 feet (1.25 miles) below ground surface.

The airborne ZTEM survey covered over 200 line miles and most of the Tombstone Mining District. A total of 373.5 line kilometers of geophysical data were acquired during the survey. In a ZTEM survey, a single vertical-dipole air-core receiver coil is flown over the survey area in a grid pattern, similar to regional airborne EM surveys. Two orthogonal, air-core horizontal axis coils are placed close to the survey site to measure the horizontal EM reference fields. Data from the three coils are used to obtain the Z/X and Z/Y Tipper (Vozoff, 1972) components at six frequencies in the 30 to 720 Hz band. The ZTEM was used to map geology using resistivity contrasts and magnetometer data were also collected to help map geology using magnetic susceptibility contrasts.

The crew was based in Tombstone, Arizona for the acquisition phase of the survey. Survey flying started on June 29, 2010 and was completed on July 4, 2010. Data quality control and quality assurance, and preliminary data processing were carried out on a daily basis during the acquisition phase of the project. Final reporting, data presentation and archiving were completed from the Aurora office of Geotech Ltd. in October, 2010. A quality control step consisted of re-examining all data in order to validate the preliminary data processing and to allow for final adjustments to the data. Attitude corrections were re-evaluated, and re-applied, on component by component, flight by flight, and frequency by frequency bases. Any remaining line to line system noise was removed by applying a mild additional levelling correction.

As a result of the survey, Geotech identified a number of conductive structures across the property that resemble known porphyry deposits and reported that the magnetic results also contained worthwhile information in support of exploration targets of interest. Based on the geophysical results obtained, Geotech recommended a more detailed interpretation of the available geophysical data, including Versatile Time-Domain Electromagnetic survey (VTEM), in conjunction with the geology, prior to ground follow up and drill testing.

In November 2010, upon review of the ZTEM data, at least four to five porphyry targets were identified on the Company'sCompany’s Tombstone property, and there is still a very large land position to review. Of the targets that have been identified so far, two have precious metal (gold and silver) occurrences as "halos"“halos” around the properties, which are significant characteristics of porphyry systems. One identified structure has been compared by Geotech to the Mount Milligan deposits that were sold and have total measured and indicated resources of 417.1 million tons grading 0.21% copper, 0.41 g/t gold for 1,934 million pounds copper and 5.5 million ounces gold. Three of the identified targets have coincident magnetic and resistivity high which are very promising geophysical signatures. One target is adjacent to a porphyry system that was drilled by a major international mining company. As of the date of this Report, the Company is continuing to work with the geophysical data acquired from the ZTEM survey of the Tombstone Project.

2012 Technical Report

In January 2012, SRK completed a Technical Report on the Tombstone property.

SRK made the following conclusions in the Report:

The Tombstone property represents a beginning exploration project with a limited amount of historical and current data. The data are insufficient to take the property to resource classification by current industry standards at this time.

The historic silver deposits in the central mining district are well documented through various reports in the literature and several master- and doctoral-level theses. Although west of the largest historical ore deposits, the Tombstone West Area property nonetheless represents an opportunity to target a resource by current methodologies of mapping, drilling, and geophysical surveys that may be successfully extracted with present-day mining techniques. In light of silver commodity price increases in recent years, the recent emphasis on potential porphyry copper and gold targets in the Tombstone area, and recent gold and copper commodity prices, the Tombstone Project warrants a current evaluation.

SRK made the following recommendations in the Report:

•Compile and analyze all available district-wide data and use that analysis to define and prioritize future targets. 

•Convert historical and current drill logs to digital format logs, re-logging holes that have incomplete logs. 

•Digitize all geochemical data. 

•Use industry-standard software for mapping and record-keeping. 

•Conduct surface geophysical surveys over targets identified by the ZTEM airborne survey. 

•Compile all data in a GIS database, and analyze coincident anomalies to define drill targets. 

•Define a drill program and budget. 

2017 drill program

The Company completed 13 holes totaling 6200’ at the Stardust project in 2017. Drilling focused mostly on the western half of the property with -45 degree inclined holes. The main Stardust Mine structure, which strikes just north of due east, and secondary NE fault splays on its north side were primary targets. Drill holes across these structures consistently intercepted intervals of quartz veining, strong silicification, and associated iron oxide minerals, all prospective for gold-silver mineralization. Wall rocks to the veins included propylitically altered monzonite intrusive, meta-volcanic, and meta-sedimentary rocks. Most of the 2017 drilling occurred in an area of thin (25-90’) gravel cover created by downward offset on the N and NW sides of E-W and NE structures.

The overall Stardust epithermal system appears differentially eroded from east to west. East of the historic mine shafts, exposures are good. Rock chip gold-silver results improve nearer to the historic Stardust mine shafts, which are located in a central corridor where the precious metals zone is better preserved from erosion, but incompletely covered by gravel. Drill holes SDR 5 and 6 tested this corridor. Drill holes SDR 7 through SDR 13 targeted quartz veins beneath gravel cover up to 300’ north and 1500’ west of the historic shafts. These holes encountered the strongest quartz vein intervals, up to 55’ thick. Quartz vein intervals were encountered through a depth range from just below the gravel cover to downhole depths up to 615’, suggesting good preservation of the precious metals zone at depth. About 1300’ west of the Stardust shaft, a prominent NE structure further down-drops tertiary volcanic rocks into fault contact with older intrusive and metamorphic rocks that host the known quartz veins. SDR 12 was collared in the hanging wall of this structure and encountered a thicker gravel sequence, tertiary volcanic rocks, and quartz veining at the fault contact between the tertiary volcanic rocks and pre-tertiary basement rocks, as well as additional quartz veins and silicification in the basement rocks. Strong alteration and structurally-controlled quartz veining continue to the western extent of the 2017 drilling, leaving the Stardust epithermal system open to the west and potentially still strengthening to the west. To date all drill results had lower grade gold than expected on this small area of drilling. Tombstone has drilled through incredible large quartz vein intercepts with this drill campaign and nearly every section sent for assay carried gold, leaving Tombstone highly optimistic on identifying greater quantities on the remaining 396 acres of the Stardust Property.

In additition to the gold assays Tombstone also had its lab prepare Analysis of 29 additional elements which included lithium. There were interesting lithium numbers in all the drill holes of which we did not expect. Although the lithium numbers are also considered low grade it will now be added to our exploration plan. Lithium is hosted in a pregmatite composition that is similar to granite with abundant quartz. The third phase drill area has a number of pregmatite outcrops of which we will be included in our next drill targets.

The first two phases of drilling were designed to establish strike length and test grades over a large enough width within the defined chlorite hematite hosted vein system. The drilling was to define structural continuity (vein continuity along strike), grade of veins and hosting chl-hem zone, and find the width of structures. 

Summary of Exploration Activities

Summary of Exploration Activities

⁽¹⁾ Our budget for 2019-2020 consists of the following expenses for a total of $4,000,000:

•Strategic Joint Ventures $3,560,000; 

•Additional Exploration work on Stardust Property; $100,000 

•Management, Office and Employee Expenses: $180,000;  

•Professional Service Expenses: Legal, Accounting, Audits: $60,000; 

•BLM Claims and Permit Expenses: $80,000 

⁽²⁾ On December 10, 2013, the Company announced a Strategic Corporate and Financing Investment that includes the acquisition of a 26% interest in EuroGas AG of Zurich, Switzerland, an international Natural Resources Holding Company with European assets in industrial minerals, oil and gas interests as well as base metal and precious metal assets located in the USA. Under the Strategic Corporate and Financing Investment in EuroGas AG, the Company will also receive from EuroGas Inc., a US company, a committed financing in the amount of $5 million USD for extensive drilling of the Tombstone property. On January 14, 2014, the Company announced the receipt of an entitlement of a 20% direct interest in EuroGas Inc.’s potential award from its pending damage lawsuit against the Slovak Republic. This is in addition to the 26% direct interest in EuroGas AG.

⁽³⁾We raised $165,500 during the year ended December 31, 2018 to cover the operating expenses of the Company and require an additional ~$3.22M for our proposed 2019 activities. To date in 2019, we have raised $785,000 to fund our operations, which included $350,000 in non-recourse promissory notes which are secured against the future revenues of the Company, bears interest at 15% per annum, and is due in quarterly payments commencing April 30, 2019 through to January 31, 2021, and $435,000 of share subscriptions for the issuance of 145,000,000 common shares of the Company at $0.003 per share. As of the date of this filing, the common shares have not been issued.

Revenues

To date we have not generated any revenues, fromhowever, with commencement of production at the Tombstone Property.Bonanza Mine we anticipate revenues to commence in the third quarter of fiscal 2022.

Principal Market

We do not currently have any market, as we have not yet identified any mineral resource on the Tombstone Propertyresources that isare of a commercially exploitable quantity. While production at the Bonanza mine produced 219oz of gold in 2021, we cannot predict whether the production will continue in exploitable quantities. If we succeed in identifying a mineral resource in commercially exploitable quantities, our principal markets should consist of metal refineries and base metal traders and dealers.

Seasonality of our Business

Our mineral exploration activities are not subject to extreme seasonal variation since the Tombstone Property isand Bonanza mines are located in Arizona. Field work, however, is best carried out in temperatures averaging 10 to 15 degrees Celsius. Our other operations, such as metallurgical review and analysis of geochemical survey results, can be carried out all year round.

Local Resources

Tombstone, Arizona is the nearest town to the Tombstone Project. Services at Tombstone are marginally adequate to support the requirements of a mining exploration and development project, but other nearby towns (Wilcox, Benson, Bisbee, and Sierra Vista) have services such as drilling contractors, equipment rental and services, engineering services, and a labor force that are more able to support our drilling program. Sierra Vista is about 18 miles from the project area. The nearest large city, Tucson—located 70 miles northwest of Tombstone along Interstate 10—has a population of more than 526,116 (2013 U.S. Census Bureau estimate) and has company, service, and contractor resources that may not be available locally. Other cities at a greater distance (Phoenix, Arizona; Las Cruces and Albuquerque, New Mexico) also are able to provide services to support exploration and mining in the area.

Surface water is scarce and groundwater supplies are somewhat limited. Walnut Gulch to the north is an ephemeral stream, as is the San Pedro River to the west. In 1882 a pipeline was constructed to bring drinking water to Tombstone from the Huachuca Mountains, 27 miles to the west. The town has municipal wells that supply the needs of the town population. Ranchers in outlying areas obtain domestic and stock water from private wells. Water supplies for development and mining would come from groundwater sources in the area. Arizona Department of Water Resources (ADWR) well records for the area indicate the water table is generally shallow, 200 to 400 feet below ground surface.

Telephone and electric power are available to the area, providing service to local ranchers and small service companies located outside of the town. Telephone service is provided by Qwest. Internet and television services also are available locally. Electric power is supplied through Sulphur Springs Valley Electric Cooperative, with 440V, three-phase lines nearby. One-ten and 220 power lines cross the property. Postal services are available by post office boxes and ground delivery. UPS, DHL, and Federal Express also are available locally.

Gas and diesel stations are 2 miles from the property, and major fuel supply stations are 15 miles away in Sierra Vista. El Paso Gas has a gas line that crosses the northeast corner of Sec. 7, T20S-R22E. Section 7 is held by Arizona State Exploration Permit 08-111864. The Southern Pacific railroad line parallels the San Pedro River.

Patents and Licenses; Industrial, Commercial and Financial Contracts; and New Manufacturing Processes

In conducting our business operations, we are not dependent on any patented or licensed processes, technology, industrial, commercial or financial contract or new manufacturing processes.

Competitive Conditions

We compete with other mining companies, some of which have greater financial resources and technical facilities, for the acquisition of mineral interests, as well as for the recruitment and retention of qualified employees.

The mineral property exploration business, in general, is intensely competitive and there is not any assurance that even if commercial quantities of ore are discovered, a ready market will exist for sale of the same. Numerous factors beyond our control may affect the marketability of any substances discovered. These factors include market fluctuations; the proximity and capacity of natural resource markets and processing equipment; and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of mineral and environmental protection. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may make it difficult for us to receive an adequate return on investment.

We compete with many companies possessing greater financial resources and technical facilities for the acquisition of mineral concessions, claims, leases and other mineral interests as well as for the recruitment and retention of qualified employees. Low metal prices and an instable market, even among competition, leads us to assume that we will not face any difficulties retaining geologists or other consultants compared to our competition.

Competition in the usual context, and as experienced by manufacturers of automobiles, durable goods, clothing, electronics, and the providers of most services simply is not a factor in the minerals market. The demand for minerals always exceeds supply, and historically prices have consistently risen. The only major factor for competition is the cost of production.

Although competition over cost of production exists, there is little competition in the marketplace for the Company’s products. The market absorbs all precious metals and most base metals produced at prevailing prices. Larger producers can hedge future production to enable easier management of expected revenue in times of price fluctuation, whereas junior companies usually sell at market prices. In today’s market larger producers have pulled back from hedging.

The primary competition in the precious metals market is for talent in the workforce. As prices have risen many new companies have started operations or are in the midst of exploration and proving of reserves. It is in this area that competition exists for experienced geologists, project managers, and mining executives. In many areas there also is a shortage of mining labor.

The Company believes it can overcome this competition due to its location in a historical mining area, year-round working conditions and nearness to major population centers of Tucson and Phoenix, Arizona. Additionally, experienced mining professionals have assisted in developing the corporation and have many contacts in the industry.

Environmental Regulations

Mineral property exploration in Arizona is governed by the State of Arizona Office of Mine Inspector as well as Title 30 of the Code of Federal Regulations, both seek to regulate and promote the development of safe and environmentally conscious mining operations. To date, our compliance with these regulations has had no material effect on our operations, capital, earnings, or competitive position, and the cost of such compliance has not been material. We are unable to assess or predict at this time what effect additional regulations or legislation could have on our activities.

Governmental Regulations

Mining operations are subject to a wide range of government regulations such as restrictions on production, price controls, tax increases, expropriation of property, environmental protection, protection of agricultural territory or changes in conditions under which minerals may be marketed. Mining operations may also be affected by claims of native peoples, any of which could have the effect of reducing or preventing us from exploiting any of our properties. We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the exploration of minerals in the State of Arizona and in the United States generally. Our mineral claims entitle our Company to continue exploration activities on our properties, subject to our compliance with various United States federal and state laws governing land use, the protection of the environment and related matters.

To maintain state mineral exploration permits in good standing, the permit holder must renew each permit annually (up to four times, for 5 years total) for a fee of $500.00 per application for renewal. A maximum of 640 acres or one whole section is allowed per application. Additionally, an initial rental fee of $2.00 per acre is due within thirty days upon notification of the intent to issue the permit. The $2.00 rental fee is for the first and second year of the permit. However, although the rent is prepaid for the second year, the permit must still be renewed for that year. Rental fees for years three thru five are $10.00 per acre per year and due annually when the permit is renewed. A bond (typically in the amount of $3,000 for a single permit or a blanket bond of $15,000 for five or more permits held by an individual or company) is also due within thirty days upon notification of the intent to issue the permit. Bond amounts may be increased during the life of the permit as determined by the Arizona State Land Department (“ASLD”) upon review of the proposed exploration activities as detailed in the Exploration Plan of Operation that must be submitted and approved by the ASLD prior to the startup of any exploration activities.

The state lands are covered by Arizona State Mineral Exploration Permits, which are administered by the ASLD. Permits to conduct drilling in Arizona are administered by the Arizona Department of Water Resources (ADWR). Permits to conduct exploration drilling on BLM lands require either a Notice of Intent or a Plan of Operations, depending upon the amount of new surface disturbance that is planned. A Notice of Intent is for planned surface activities that anticipate less than 5.0 acres of surface disturbance, and usually can be obtained within a 30 to 60 day time period. A Plan of Operations will be required if there is greater than 5.0 acres of new surface disturbance involved with the planned exploration work. A Plan of Operations can take several months to be approved, depending on the nature of the intended work, the level of reclamation bonding required, the need for archeological surveys, and other factors as may be determined by the BLM. No other permits are required for exploration drilling.

The Company has a Notice of Intent – Mineral Exploration Drilling AZA33591 to conduct drilling on BLM claims in Secs. 9 and 10, T20S-R22E. The permitted drilling was partially completed in 2007 with the drilling of holes TEM 1, TEM 2, and TEM 3. The Company also has received conditional approval, upon completion of archaeological and cultural resource surveys, to drill in Sec. 16, T20SR22E under Arizona State Exploration Permit 08-111868.

Quality Control Procedures (QA/QC)

Bagged and sealed sample splits from the RC drill holes are transported to a secure storage shed at the office site by Company employees. The dry samples are further reduced by crushing them to 3/4 inch-minus with a “chipmunk” jaw crusher and splitting the crushed sample with a riffle splitter. The crusher and the splitter are then both cleaned with a brush and compressed air after preparation of each sample. The sample splits for the laboratory are reduced to approximately 10 lbs or less prior to submission to the laboratory. The prepared samples are bagged, labeled, and sealed and taken to the analytical laboratory, Mountains States R&D International, Inc. (MSRDI), an Arizona certified assay laboratory, in Vail, Arizona for analyses by fire assay (gold and silver) and by atomic absorption (AA) (all other analyses). The splits that are not shipped for assay are reduced to approximately 1 lb to be retained for reference at the project site and they are stored in a secure steel shipping storage container.

Laboratory rejects are discarded during the process of reducing sample splits to approximately 1 lb samples for retention. The retained sample splits are derived from the original samples and kept in storage while another split is sent for analysis. The pulps are retained and stored in a locked onsite office building.

Samples collected from other locations in the project area (surface outcrops, mine dumps, trenches, and underground workings) are collected, bagged, labeled, sealed, logged, and transported. The samples are prepared for storage or for shipment to the analytical laboratory in the following manner: Dry samples are reduced by first crushing them to 3/4 inch-minus with a “chipmunk” jaw crusher and then splitting the crushed sample using a riffle splitter. The crusher and splitter are then both cleaned with a brush and compressed air after preparation of each sample. Wet samples are dried and then processed in the same manner. The prepared samples are bagged, labeled, and sealed and taken to MSRDI for analysis. The splits that are not shipped for assay are retained for reference at the project site in a secure storage container.

All sampling and sample preparation of coarse crushed (3/4 inch-minus) are conducted by the Company’s employees. Sample pulp preparation is conducted at MSRDI. All samples are shipped to MSRDI. All gold and silver analyses are obtained by fire assay. All other analyses (Cu, Pb, and Zn) are obtained by atomic absorption (AA) with standard digestion.

Samples collected from surface sites, trenches, underground workings, and the 2007 drilling program (prior to November 2007) did not include blanks, duplicates, reference standards, or other industry standard QA/QC procedures.

Quality control procedures began at the Tombstone Project approximately November 2007. Ten samples collected underground from the Santa Ana mine (NE¼ NE¼ Sec. 16, T20S-R22E) on October 30, 2007 were submitted to the laboratory (MSRDI) with blanks and reference standards. The reference samples were obtained from Minerals Exploration and Environmental Chemistry, Reno, Nevada. Blanks were prepared by crushing and bagging cinder blocks. Results received for these samples are used to assess the accuracy of the MSRDI analyses. Check samples on the order of 5 to 10 percent of the number of samples were sent to ALS Chemex, Reno, Nevada and from there were forwarded to their laboratory in Canada for analysis. The pulps that were returned from the primary laboratory were used as the check-sample materials.

Samples are stored at the Company office site in a secure storage container or in the Company laboratory, which is locked during nonworking hours.

As of the date of our Technical Report, April 18, 2008, SRK concluded that the sampling procedures were acceptable and within industry standards with the exception of initial sample preparation by the Company. Coarse crushed sample preparation onsite by the property owner is not common industry standard practice unless logistics and distance from the labs are a major factor. It may be acceptable going forward, if the newly implemented QA/QC procedures incorporate sufficient checks to demonstrate that the initial sample preparation imparts no contamination or bias.

C. Organizational Structure

We have one wholly owned subsidiary, Tombstone Exploration and Mining Corporation, a Nevada corporation (“TEMC”) that is qualified to do business in the State of Arizona. All of our operations are conducted through TEMC.

Tombstone Exploration Corp. owns 40% of the Bonanza Mining Company, an entity incorporated in Nevada and qualified to do business in the State of Arizona.

D. Property, Plants and Equipment

Our principal executive office is located at 6529 E. Friess Drive, Scottsdale, AZ 85254. Additionally, we share this space with our wholly owned subsidiary, TEMC. Pursuant to our lease executed January 1, 2016, we rent both office and storage space for $1,000 per month for a 5 year term.We currently do not pay any rent. We believe that this existing space is adequate for our current needs. Should we require additional space, we believe that such space can be secured on commercially reasonable terms.

The Company has the mineral rights to approximately 640 acres of historical mining land in areas around Tombstone, Arizona. The Tombstone Project is located on patented mining claims, unpatented mining claims and state lands administered by the ASLD.Our Properties

Our Properties

Industry of Interest

The precious metals and base metals industry produces over $100B in metal production per year. The industry is essentially two sectors: the major producers and the junior exploration and mining companies.

The major producers such as Freeport McMoran, Rio Tinto, and BHP Billiton produce the majority of precious and base metals from large scale, geologically scattered operations. Property expansion by the majors typically comes from joint venture, consolidation or acquisition with junior exploration and mining companies. This occurs usually because a junior finds it difficult to initiate full scale operations due to the significant front end development costs. The majors can absorb and develop the newly discovered fields with little impact to overhead operations and can fund direct operations through forward sale of metals.

Juniors typically spend the majority of their money locating new potential areas, proving up a portion of reserves through geological studies, analyses and drilling, and then initialing small scale operations. During that period most successful juniors draw the attention of and team up in some way with a major producer.

Cost of operations/production is the driver in the industry. All product produced, particularly in the precious metals industry, is absorbed by the market. Demand exceeds supply. The most profitable companies have the lowest per ounce/pound cost of production. The highest return to investors, however, comes from junior companies, when successful, where per share prices are lower until a viable project is proven. Risk, though, is often higher with junior companies, unless and until they locate and acquire viable projects and adequate funding.

The prime customers for the precious metals sector of the industry are the refiners such as Englehart, Johnson Maffey, etc. These companies serve as the distributor of product between the producers and the consumers. The majority of precious metals produced are utilized by the industrial and electronics industry, the automotive industry, the jewelry industry and the investment community.

As metal prices have risen, so too has the interest in new areas for exploration and eventual production. The past two decades have seen a significant expansion of interest into Central and South America, as well as developing third world countries. Today’s price levels combined with the political uncertainties of many foreign projects, and the inability for year-round operations in portions of Alaska and northern Canada, have produced a resurgence of junior companies in the mainland United States. However, many juniors target only one or two categories of metals. This model of operation limits their chance of success for production or buyout.

The keys to success for today’s junior exploration and mining companies are four: 1. Property holdings and potential; 2. location; 3. metal diversity; and 4. cost of development and operation.

The Tombstone Property

Most of the historic mines in the Tombstone Mining District were polymetallic, with the principal ores produced being silver from bonanza grade deposits. However, anomalous copper, lead, zinc, manganese, and gold have been identified, and some of these metals have been produced from different mines in Cochise County (i.e., copper from Bisbee, lead from the Charleston Mining District, and silver and manganese from the Tombstone Mining District).

The principal exploration concept pursued by the Company since 2010 is for low-grade, large tonnage porphyry copper mineralization, largely buried beneath basin fill. The concept is based upon the regional geology that includes the Tombstone caldera complex with related intrusives and complex fault systems; porphyry copper mineralization intersected at depths greater than 3,000 ft by Asarco and other major mining companies that drilled the area in the 1970s, 1980s, and 1990s; and geochemically anomalous values and zoning patterns of Cu, Ag, Pb, and Zn ratios in rock chip samples from mine dumps in the western part of the district that broadly coincide with the Lowell and Guilbert (1970) porphyry copper model.

Silver mineralization also is an exploration target, in particular in the western area of the Company’s landholdings. The silver exploration concept is seeking to tie together the northeast-striking mineralized fissures into silver deposits that are projected to connect historic deposits and prospects along strike and to extend the depths of mineralization to perhaps hundreds of feet beneath the water table; the exploration potential below the water table was minimally explored and/or mined in the past. The horizontal and vertical extensions of the fissure veins are expected to be more definable by current exploration methods and would be amenable to underground or open pit mining methods.

Gold exploration is a concept based upon historic geochemical and geophysical exploration, shallow drilling, and reported gold grades in the Stardust area from the 1900s intermittently through the 1990s.

Stratigraphy

Rocks in the Tombstone area range from Precambrian to Quaternary in age. The oldest rock is fine- grained, grayish Precambrian Pinal schist, intruded by Precambrian granitic and porphyritic rocks, and unconformably overlain by a thick sequence of Paleozoic sedimentary rocks that change from mainly limestone to mainly sandstone and shale. The uppermost unit, the Naco limestone is an erosion surface unconformably overlain by the Mesozoic Bisbee group, a series of conglomerate, sandstone, quartzite, shale, and limestone with two or three lenses of soft, bluish-gray limestone.

The deposition of the Mesozoic sedimentary rocks was followed by a period of deformation and igneous activity. Late Cretaceous time was marked by eruptive and intrusive activity associated with the Tombstone volcanic center that probably formed within a continental-margin arc. The Tombstone volcanic center erupted the Uncle Sam Tuff at 73.5 +/- 2.8 Ma, and an irregularly shaped caldera formed as a consequence of collapse into the evacuated magma chamber. These events were accompanied by emplacement of the Schieffelin granodiorite, diorite stocks and plugs, and andesite dikes. Silver mineralization is directly associated with the folding, faulting, igneous intrusions, and fissuring of this period: north-south (dike) fissures, faults, anticlines and rolls, and—in the western area in particular—with the north-south trending dikes and cross-cutting northeast-trending fissures. Most of the silver deposits are associated with at least two structural features, often at their intersection. Rocks of the Tombstone volcanic center postdate Laramide thrust faulting and are little deformed.

The Basin and Range province was formed during the Cenozoic Era when east-west crustal extension resulted in vertical movement on generally north-south trending faults. Extension gave rise to the emplacement of extensive granitic stocks and batholiths with associated volcanic activity. Locally steep tilting and minor normal faulting occurred during Basin and Range block faulting.

Bromeyerite is the main supergene silver mineral; the main hypogene silver-bearing minerals are hessite, tetrahedrite, and galena. Base metal mineralization, often oxidized, occurs in fault and fracture zones in Laramide volcanics and the Uncle Sam tuff. The most common base minerals are sphalerite, galena, and chalcopyrite. Chalcopyrite is widespread, most commonly as exsolution blebs in sphalerite. Manganese mineralization is widespread throughout the Tombstone district and has occurred in various amounts with most of the oxidized silver-lead mineralization. The manganiferous mineralization exists as replacements in limestone.

Development Strategy & Plan of Operations for the Next Twelve Months

The Company’s development strategy is to focus on the fundamental keys to success for a junior exploration and mining concern. These keys were identified in the Industry discussion.

Property holdings and potential.

Plan: Continue geological analyses including mapping, and identification of drill targets. Focus on these targets for drilling, sampling and identifying potential reserves. Expand target areas as drilling progresses and studies expand knowledge of properties.

1.Location

Plan: The Company’s Tombstone property is located in a known metal and mineral area with easy access, historical production, mining friendly community and ease of permitting puts the Company in a position for success. The Company will continue to identify areas on the properties for mill site operation, improve off-road access and work closely with the community at large to offer employment opportunities. The Company will also interface with the state level in Arizona to establish itself as a significant contributor to the state economy.

2.Metal diversity

Plan: A significant number of metals and minerals have already been identified on the Tombstone property including silver and gold. The Company, with the help of consulting organizations, will further explore the range of metals and minerals, and the ability to extract/produce product for market. In the non-precious metals areas, the Company will likely seek joint venture partners who will add to the success and financial returns for our shareholders.

3.Cost of development and operation

Plan: The Company may establish a small production operation, subject to permitting, financing and sufficient resources, to begin silver and gold production with material from existing known sites. As drill targets identify key areas for drilling, the operation will be expanded to two large scale mill sites. The Company firmly believes from the sampling and historical production in the area, that a low cost / high profit operation will be developed.

ITEM 4A. UNRESOLVED STAFF COMMENTSItem 4A Unresolved Staff Comments

Not required.

ITEMItem 5. Operating and Financial Review and Prospects

The following discussion and analysis of our financial condition and results of operations for the fiscal years ended December 31, 2015 to December 31, 20182021, 2020, and 2019, should be read in conjunction with our financial statements and related notes included in this Report. Our financial statements included in this Report were prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).

A. Operating Results

Our results of operations have been, and may continue to be, affected by many factors of a global nature, including economic and market conditions, the availability of capital, the level and volatility of prices and interest rates, currency values, commodities prices and other market indices, technological changes, the availability of credit, inflation and legislative and regulatory developments. Factors of a local nature, which include the political, social, financial and economic stability, the availability of capital, technology, workers, engineers and management, geological factors and weather conditions, also affect our results of operations. See “Key Information – Risk Factors”. As a result of the economic and competitive factors discussed above, our results of operations may vary significantly from period to period.

Year Ended December 31, 2018 Compared2021 compared to Years Ended December 31, 2015, 2016,2020 and 20172019

For the years ended December 31, 2015 through December 31, 2018,2021, 2020, and 2019, we did not receive any revenue from various mining claims and properties.

The net loss for the year ended December 31, 20182021 of $1,846,151 was attributed to $24,918directors and management fees of general$669,800 which was primarily related to management fees of $144,000 to the President and administrative expenses, $240,000Director of managementthe Company along with the issuance of common shares of the Company to officers and directors’ fees, $95,114directors of professional fees, $137,074the Company, consulting services of consulting service fees, $23,084 of$274,950 related to ancillary services for its mineral property exploration costs, offsetprofessional fees of $51,581 for audit, accounting, and legal fees incurred by the Company in its operations, and a gainproportionate loss on settlementthe Company’s investment in Bonanza Project of debt of $23,577.$783,165.

The net loss for the year ended December 31, 20172020 was attributed to $18,214directors and management fees of general and administrative expenses, $380,411$762,947 which was primarily related to the issuance of management and directors’ fees, $111,647common shares of the Company, consulting services of $556,760, professional fees $27,032 of consulting service$41,318 for audit, accounting, and legal fees $290,125 of mineral property exploration costs, offsetincurred by the Company in its operations, a gainloss on settlement of debt of $24,125. The Company’s net loss in 2018 decreased compared to 2017 as the Company incurred less management$43,068, and director fees, professional fees, and mineral property exploration costs, as well as decrease in accretion expense anda proportionate loss on fair valuethe Company’s investment in Bonanza Project of derivative liabilities.

$85,028. The loss was offset by a gain of $198,801 relating to the forgiveness of non-recourse loans that were issued in the prior year.

The net loss for the year ended December 31, 20162019 was attributed to $60,600directors and management fees of general and administrative expenses, $774,625$825,177 which was primarily related to the issuance of management and directors’ fees, $64,373common shares of professional fees, $55,756 of consulting service fees, $5,419the Company, $355,991 of mineral property exploration costs offsetincluding the impairment of the Bahamas Aggregate investment of $350,000, consulting services of $111,392, professional fees of $71,264 for audit, accounting, and legal fees incurred by the Company in its operations, a gain/loss on settlement of debt of $2,754. The decrease in the net loss in 2017 compared to 2016 was due to the fact that we incurred more management and director’s fee in 2016 due to share-based compensation as our share price was trading at a higher average price in 2016 compared to 2017. This was offset by the fact that we had more mineral property costs in 2017 as we spent more of our funding and operating efforts on the exploration of our properties.

The net loss for the year ended December 31, 2015 was attributed to $53,686 of general and administrative expenses, $135,000 of management and directors’ fees, $77,495 of professional fees, $70,849 of consulting service fees, $10,987 of mineral property exploration costs, offset by a gain/loss on settlement of debt of $0. Furthermore, the Company recorded a $0 gain/loss on conversion of debt, $202,193$243,065 which included $228,750 loss on the fair valuesettlement of a loan payable with the derivative liabilities and accretionissuance of common shares, and interest expense of $166,733. The Company’s net loss in 2015 decreased compared to 2016 as$65,870 which included accrued interest on promissory notes payable of $397,500 which included $362,000 of new notes payable issued during the year that bear interest at 15% per annum.

Overall, the Company incurred less consulting fees, professional fees,continues to incur operating losses while it continues its development of its projects and accretion expense offset by an increaseproperties, with no significant changes in the lossnature of our operations, with the exception of fiscal 2021 which saw the first full year of operating results related to the Bonanza Project. As more costs are being invested into Bonanza, we have relied less on fair value of derivative liabilities.external consultants and no longer have floating rate convertible debentures to fund our operations, as was evident in fiscal 2018 and previous years.

B. Liquidity and Capital Resources

Since our incorporation, we have financed our operations almost exclusively through the sale of our common shares to investors and issuance of convertible notes payable. As we are now focusing on mining exploration with no producing resource properties, we do not generate operating income or cash flow from our business operations. Until a significant body of ore is found, our working capital requirements are not significant, and we expect to continue to finance operations through the sale of equity in fiscal 2019-2020.future years. There is no guarantee that we will be successful in arranging financing on acceptable terms.

To a significant extent, our ability to raise capital is affected by trends and uncertainties beyond our control. These include the market prices for base and precious metals and results from our exploration programs. Our ability to attain our business objectives may be significantly impaired if prices for metals such as gold and uranium fall or if results from our intended exploration programs on our properties are unsuccessful.

December 31, 2021, 2020, and 2019

At December 31, 2018,2021, we had cash on hand of $39,858$166,747 as compared to $51,311 as of December 31, 2017, and $17,063$176,120 as at December 31, 2016. Total liabilities consisted of accounts payable, accrued liabilities, and amounts2020.  The decrease in cash was due to related parties, convertible debentures,the net effect of use of cash raised from financing activities for its operations and derivativeadditional $780,000 of investment into the Bonanza Project.   We had total assets of $3,039,690 at December 31, 2021 compared to total assets of $3,052,512 at December 31, 2020.  Overall, our total assets were consistent with the prior year.  

We had current liabilities totaling $515,381of $845,456 at December 31, 2021 compared to current liabilities of $545,827 at December 31, 2020. The increase in 2018 (2017- $372,452) (2016- $244,257). The overall increase incurrent liabilities is due to a higheradditional issuances of notes payable during the current year of $279,000 from related parties. We also saw an increase in accounts payable and amountsaccrued liabilities of $20,929 due to related partiestiming differences in the payment of outstanding obligations as they become due.

We had a working capital deficit of $498,709 at December 31, 2021 compared to a deficit of $369,707 at December 31, 2020 The decrease in the working capital was due to the use of the loan proceeds to support its ongoing cash investment in Bonanza Project as well as for general and operating expenditures incurred during the year.

At December 31, 2016, we had cash on hand of $17,063 as compared to December 31, 2015, we had cash on hand of $164,808. Total liabilities consisted of accounts payable, accrued liabilities, and amounts due to related parties, convertible debentures, and derivative liabilities totaling $244,257 (2015- $438,658). The overall decrease in liabilities is due to a much tighter budget being maintained during the year.

Application of Critical Accounting Policies

The preparation of financial statements in conformity with applicable generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain. As the number of variables and assumptions affecting the probable future resolution of the uncertainties increase, these judgments become even more subjective and complex. Our significant accounting policies are disclosed in the Notes to our financial statements included in this Report.

C. Research and Development, Patents and Licenses, etc.

We do not currently, and did not previously, have research and development policies in place. Over the past five fiscal years, we have not expended any material amounts on research or development.

D. Trend Information

Our business is the exploration for and development of mineral deposits. The market price of precious metals and other minerals is volatile and has fluctuated widely, particularly in recent years. The prices of various metals are affected by numerous factors beyond our control, including international economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates and global or regional consumption patterns, speculative activities and increased production due to improved mining and production methods. The commodity price of precious metals has a direct impact on our revenue prospects and our ability to raise capital. Although there is no assurance that this trend will continue, management is optimistic that the current price level will continue for the foreseeable future.

E. Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resource that is material to investors.

F. Tabular Disclosure of Contractual Obligations

WeThe following table sets forth our contractual obligations by specified categories as of December 31, 2021.

Other than the contractual obligations set forth above, we do not have any contractual obligations and commitments as of December 31, 2018, 2017 and 2016 that will require significant cash outlays in the future.are long-term debt obligations, capital (finance) lease obligations, purchase obligations or other long-term liabilities reflected on our balance sheet.

G. Safe Harbor

Forward Looking Statements

This annual report contains forward-looking statements that reflect our current expectations and views of future events. These forward-looking statements can be identified by words or phrases such as “shall,” “may,” “will,” “expect,” “should,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to” or other similar expressions. These forward-looking statements include, among other things, statements relating to our goals and strategies, our competitive strengths, our expectations and targets for our results of operations, our business prospects and our expansion strategy. Those statements appear in a number of places and include statements regarding our intent, belief or current expectations with respect to:

We have based these forward-looking statements largely on current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Although we believe that we have a reasonable basis for each forward-looking statement contained in this annual report, we caution shareholders that these statements are based on our projections of the future that are subject to known and unknown risks and uncertainties and other factors that may cause our actual results to differ materially from those in the forward-looking statements.

The forward-looking statements included in the annual report are subject to risks, uncertainties and assumptions about our company. Our actual results of operations may differ materially from the forward-looking statements as a result of risk factors described under “Risk Factors” and elsewhere in this annual report. These risks are not exhaustive. It is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statement. An investor in our Company should not rely upon forward looking statements as predictions of future events. Unless required by law, we undertake no obligation to update or revise any forward-looking statements to reflect new information or future events or otherwise.

ITEM 6.Item 6 Directors, Senior Management and Employees

A. Directors and Senior Management

The following table sets forth the names, business experience and function/areas of expertise of each of our directors and officers as of the date of this report:

⁽¹⁾Mr. Cistone was appointed as a member of the Board of Directors on January 7, 2016. 

⁽²⁾Mr. Rauch was appointed as a member of the Board of Directors on October 12, 2017 

⁽³⁾Mr. Mehok was appointed as a member of the Board of Directors on July 1, 2018  

Alan M. Brown, President & CEO – Mr. Brown is the company’s President and Chief Executive Officer. He has an extensive background in accounting and mining exploration, along with experience in corporate mergers and acquisitions, real estate acquisitionand development. Prior to founding TMBXF, Mr. Brown spent several years working for a Chartered Accounting firm on Vancouver Island. He was also the chief controller for a Canadian real estate development company involved in multi-million dollar projects. Mr. Browns has been involved in the Public Markets since 2001 as senior board member of all companies that he has worked with.

Daniel A. Cistone, Chairman of the Board - Mr. Cistone brings his broad technical background and proven boardroom leadership experience to the role of Chairman. He has strong experience and expertise in finance, which includes acquisitions and startups both domestically and abroad, as well as management of those companies, and will be a huge asset to the Company. Mr. Cistone is the President of Daniel A. Cistone’s Consulting LLC. and serves as a Director on several corporate and local boards in his community. Previously, he spent 40 years with M&C Specialties Co., a global fabrication company as CFO/CEO. He received his BSBA in Accounting from Villanova University, Villanova, PA.

Donald Rauch, Director - Mr. Rauch graduated in 1969 from Michigan State University cum laude in Business Administration. Mr. Rauch was President and CEO from 1995-2007 of M & C Specialties Co, a leading global fabricator/converter of pressure sensitive materials. He grew the business from a one plant operation in Philadelphia to an international business with plants in Ireland, Mexico, China and California. M & C Specialties was sold to ITW in June of 2007. His Board experience is extensive being M&C Specialties 1973 through 2007, Creative Financial Group Advisory Council, Warminster Hospital, Gasket Fabricators Assoc., Delaware Valley Industrial Resource Center, Laminators Inc., and Airline Hydraulics Inc.

Mr. Mark Mehok– Mr. Mehok graduated in 1991 from the University of Pittsburgh with a BS in Sports Medicine. He then went on to obtain his Master of Science from Widener University in 1996 and then his MBA from Penn State University in 2001. He was a practicing Physical Therapist prior to establishing 2M Sales and Development which is an independent Sales and Distribution company in the Healthcare and Medical device space. He still acts as the President of 2M Sales and Development. He is an Investor in numerous start up companies, many of which he acts as an advisor to. 

Additional Information

There are no familial relationships between our officers and directors.

The above listed officers and directors were not selected as directors or members of senior management pursuant to any arrangement or understanding with major shareholders, customers, suppliers or others.

B. Compensation

During the fiscal year ended December 31, 2018,2021, 2020, and December 31, 20172019 the aggregate remuneration paid to directors in their capacity as directors of our Company was $80,000$144,000, $144,000, and $75,000,$156,000, respectively. Management fees totaling $360,000$669,800, $762,947, and $825,177, was paid to directors and officers for each of the years ended December 31, 20182021, 2020, and 2017. During the fiscal year ended December 31, 2016, the aggregate remuneration paid to directors in their capacity as directors of our Company was $Nil. Management fees totaling $774,625 was paid to directors and officers. During the fiscal year ended December 31, 2015, the aggregate remuneration paid to directors in their capacity as directors of our Company was $Nil. Management fees totaling $135,000 was paid to directors and officers.2019, respectively.

Executive Compensation

The following table provides a summary of compensation paid by us during the fiscal years ended December 31, 20182021, 2020, and 20172019, to our executive officers who received a salary: