Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 28, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | AMERICAN RESOURCES CORPORATION | |
Entity Central Index Key | 0001590715 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Sep. 30, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 35,602,410 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS | ||
Cash | $ 753,910 | $ 3,324 |
Accounts Receivable | 46,150 | 2,424,905 |
Inventory | 150,503 | 515,630 |
Prepaid fees | 175,000 | 0 |
Accounts Receivable - Other | 234,240 | 234,240 |
Total Current Assets | 1,359,803 | 3,178,099 |
OTHER ASSETS | ||
Cash - restricted | 637,806 | 265,487 |
Processing and rail facility | 11,591,273 | 12,723,163 |
Underground equipment | 6,838,417 | 8,294,188 |
Surface equipment | 2,527,576 | 3,224,896 |
Acquired mining rights | 561,575 | 669,860 |
Coal refuse storage | 12,134,192 | 12,171,271 |
Less Accumulated Depreciation | (11,971,657) | (11,162,622) |
Land | 1,572,435 | 1,748,169 |
Note Receivable | 4,117,139 | 4,117,139 |
Total Other Assets | 28,008,756 | 32,051,551 |
TOTAL ASSETS | 29,368,559 | 35,229,650 |
CURRENT LIABILITIES | ||
Accounts payable and accrued liabilities | 5,640,915 | 6,604,134 |
Accounts payable - nontrade | 4,012,674 | 4,440,345 |
Accounts payable - related party | 979,146 | 718,156 |
Accrued interest | 573,526 | 2,869,763 |
Due to affiliate | 74,000 | 132,639 |
Current portion of long term-debt (net of issuance costs and debt discount of $0 and $134,296) | 12,469,374 | 20,494,589 |
Current portion of convertible debt | 0 | 7,419,612 |
Current portion of reclamation liability | 2,327,169 | 2,327,169 |
Total Current Liabilities | 26,076,804 | 45,006,407 |
OTHER LIABILITIES | ||
Long-term portion of note payable (net of issuance costs of $408,546 and $417,183) | 4,734,639 | 5,415,271 |
Convertible note payables - long term | 16,911,548 | 0 |
Reclamation liability | 15,222,499 | 17,512,613 |
Total Other Liabilities | 36,868,686 | 22,927,884 |
Total Liabilities | 62,945,490 | 67,934,291 |
STOCKHOLDERS' EQUITY (DEFICIT) | ||
AREC - Class A Common stock: $.0001 par value; 230,000,000 shares authorized, 28,400,512 and 27,410,512 shares issued and outstanding, respectively | 2,839 | 2,740 |
Additional paid-in capital | 91,397,889 | 90,326,104 |
Accumulated deficit | (124,977,659) | (123,033,485) |
Total Stockholders' Deficit | (33,576,931) | (32,704,641) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | 29,368,559 | 35,229,650 |
Series A Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred shares | 0 | 0 |
Series C Preferred Stock [Member] | ||
STOCKHOLDERS' EQUITY (DEFICIT) | ||
Preferred shares | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Unamortized discount, current portion of long term-debt | $ 0 | $ 134,296 |
Debt issuance costs, long-term portion of note payable | $ 408,546 | $ 417,183 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Par Value | $ .0001 | $ .0001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Series C Preferred Stock [Member] | ||
Preferred Stock, Par Value | $ .0001 | $ .0001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Class A [Member] | ||
Common Stock, Par Value | $ .0001 | $ .0001 |
Common Stock, Shares Authorized | 230,000,000 | 230,000,000 |
Common Stock, Shares Issued | 28,400,512 | 27,410,512 |
Common Stock, Shares Outstanding | 28,400,512 | 27,410,512 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED | ||||
Coal Sales | $ 0 | $ 1,847,279 | $ 524,334 | $ 18,162,805 |
Metal Aggregating, Processing and Sales | 294,646 | 0 | 521,482 | 0 |
Processing Services Income | 0 | 0 | 0 | 20,876 |
Total Revenue | 294,646 | 1,847,279 | 1,045,816 | 18,183,681 |
Cost of Coal Sales and Processing | (72,692) | (2,956,306) | (2,590,435) | (15,254,961) |
Accretion Expense | (240,685) | (320,900) | (981,859) | (962,699) |
Depreciation | (646,438) | (1,414,942) | (1,855,236) | (3,036,747) |
Amortization of mining rights | (313,224) | (252,729) | (939,672) | (1,592,110) |
General and Administrative | (132,676) | (1,434,545) | (1,659,908) | (3,798,051) |
Professional Fees | (175,832) | (170,937) | (686,158) | (5,136,767) |
Production Taxes and Royalties | (154,604) | (948,148) | (404,660) | (2,811,691) |
Development Costs | (792,926) | (1,425,024) | (1,228,333) | (5,912,589) |
Total Operating Expenses | (2,529,078) | (8,923,531) | (10,346,261) | (38,505,615) |
Net Loss from Operations | (2,234,432) | (7,076,252) | (9,300,445) | (20,321,934) |
Other Income | 160,635 | 770,405 | (153,544) | 1,251,359 |
Gain on interest forgiven | 832,500 | 0 | 832,500 | 0 |
Gain on Depreciation Recapture | 1,706,569 | 0 | 1,706,569 | 0 |
Gain on sale of stock | 0 | 0 | 6,820,949 | 0 |
Loss on settlement of payable | 0 | 0 | (22,660) | |
Amortization of debt discount and issuance costs | (2,879) | (219,218) | (8,637) | (7,722,197) |
Interest Income | 41,172 | 82,343 | 164,686 | 164,686 |
Warrant Modification Expense | 0 | 0 | 0 | (2,545,360) |
Interest expense | (379,583) | (901,810) | (1,891,226) | (1,674,653) |
Total Other income (expense) | 2,358,413 | (268,280) | 7,471,297 | (10,548,825) |
Net Income (Loss) | $ 123,982 | $ (7,344,532) | $ (1,829,148) | $ (30,870,759) |
Net loss per common share - basic and diluted | $ 0 | $ (0.30) | $ (0.07) | $ (1.34) |
Weighted average common shares outstanding | 26,785,364 | 24,886,763 | 27,009,075 | 23,025,762 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) UNAUDITED - USD ($) | Total | Preferred Series C [Member] | Common Share [Member] | Preferred Series A [Member] | APIC | Accumulated Deficit | Noncontrolling Interest |
Balance, shares at Dec. 31, 2018 | 50,000 | 17,763,469 | 481,780 | ||||
Balance, amount at Dec. 31, 2018 | $ (9,199,822) | $ 5 | $ 1,776 | $ 48 | $ 42,913,532 | $ (52,115,183) | $ 0 |
Issuance of common shares for cash, net, shares | 1,170,200 | ||||||
Issuance of common shares for cash, net, amount | 4,254,000 | $ 0 | $ 117 | $ 0 | 4,253,883 | 0 | 0 |
Issuance of common shares for services, shares | 159,000 | ||||||
Issuance of common shares for services, amount | 1,672,200 | $ 0 | $ 16 | $ 0 | 1,672,184 | 0 | 0 |
Issuance of common shares for asset acquisition, shares | 2,000,000 | ||||||
Issuance of common shares for asset acquisition, amount | 24,400,000 | $ 0 | $ 200 | $ 0 | 24,399,800 | 0 | 0 |
Issuance of common shares for conversion of debt and accounts payable, shares | 4,417 | ||||||
Issuance of common shares for conversion of debt and accounts payable, amount | 49,161 | $ 0 | $ 0 | $ 0 | 49,161 | 0 | 0 |
Issuance of warrants to consultants | 2,385,000 | 0 | 0 | 0 | 2,385,000 | 0 | 0 |
Stock option expense | 68,693 | $ 0 | $ 0 | $ 0 | 68,693 | 0 | 0 |
Issuance of common shares for warrant exercise, shares | 599,427 | ||||||
Issuance of common shares for warrant exercise, amount | 0 | $ 0 | $ 60 | $ 0 | (60) | 0 | 0 |
Conversion of Series A Preferred into common stock, shares | 1,605,934 | (481,780) | |||||
Conversion of Series A Preferred into common stock, amount | 0 | $ 0 | $ 161 | $ (48) | (113) | 0 | 0 |
Conversion of Series C into common stock, shares | (50,000) | 13,750 | |||||
Conversion of Series C into common stock, amount | 0 | $ (5) | $ 1 | $ 0 | 4 | 0 | 0 |
Beneficial conversion on note payable due to modification | 7,362,925 | 0 | 0 | 0 | 7,362,925 | 0 | 0 |
Net loss | (14,565,185) | $ 0 | $ 0 | $ 0 | 0 | (14,565,185) | 0 |
Balance, shares at Mar. 31, 2019 | 23,316,197 | ||||||
Balance, amount at Mar. 31, 2019 | 16,426,972 | $ 0 | $ 2,331 | $ 0 | 83,105,009 | (66,680,368) | 0 |
Balance, shares at Dec. 31, 2018 | 50,000 | 17,763,469 | 481,780 | ||||
Balance, amount at Dec. 31, 2018 | (9,199,822) | $ 5 | $ 1,776 | $ 48 | 42,913,532 | (52,115,183) | 0 |
Beneficial conversion on note payable due to modification | 7,362,925 | ||||||
Net loss | (30,870,759) | ||||||
Warrant modification Expense | 2,545,360 | ||||||
Issuance of Warrants in conjunction with Convertible Notes | 0 | ||||||
Balance, shares at Sep. 30, 2019 | 27,267,197 | ||||||
Balance, amount at Sep. 30, 2019 | 7,110,790 | $ 0 | $ 2,726 | $ 0 | 90,094,006 | (82,985,942) | 0 |
Balance, shares at Mar. 31, 2019 | 23,316,197 | ||||||
Balance, amount at Mar. 31, 2019 | 16,426,972 | $ 0 | $ 2,331 | $ 0 | 83,105,009 | (66,680,368) | 0 |
Issuance of common shares for cash, net, shares | 25,000 | ||||||
Issuance of common shares for cash, net, amount | 100,000 | $ 0 | $ 3 | $ 0 | 99,997 | 0 | 0 |
Issuance of common shares for services, shares | 58,000 | ||||||
Issuance of common shares for services, amount | 133,840 | $ 0 | $ 6 | $ 0 | 133,834 | 0 | 0 |
Issuance of warrants to consultants | 139,500 | 0 | 0 | 0 | 139,500 | 0 | 0 |
Stock option expense | 73,603 | 0 | 0 | 0 | 73,603 | 0 | 0 |
Net loss | (8,961,042) | $ 0 | $ 0 | $ 0 | 0 | (8,961,042) | 0 |
Issuance of common shares for conversion of accounts payable, shares | 50,000 | ||||||
Issuance of common shares for conversion of accounts payable, amount | 182,500 | $ 0 | $ 5 | $ 0 | 182,495 | 0 | 0 |
Common shares issued in connection with note payable, shares | 25,000 | ||||||
Common shares issued in connection with note payable, amount | 87,250 | $ 0 | $ 3 | $ 0 | 87,247 | 0 | 0 |
Cancellation of common shares, shares | (107,000) | ||||||
Cancellation of common shares, amount | 0 | $ 0 | $ (11) | $ 0 | 11 | 0 | 0 |
Warrant modification Expense | 2,545,360 | $ 0 | $ 0 | $ 0 | 2,545,360 | 0 | 0 |
Balance, shares at Jun. 30, 2019 | 23,367,197 | ||||||
Balance, amount at Jun. 30, 2019 | 10,727,983 | $ 0 | $ 2,337 | $ 0 | 86,367,056 | (75,641,410) | 0 |
Stock option expense | 103,060 | 0 | 0 | 0 | 103,060 | 0 | 0 |
Net loss | (7,344,532) | $ 0 | $ 0 | $ 0 | 0 | (7,344,532) | 0 |
Common shares issued in connection with note payable, shares | 300,000 | ||||||
Common shares issued in connection with note payable, amount | 210,581 | $ 0 | $ 30 | $ 0 | 210,551 | 0 | 0 |
Issuance of common shares and warrants issued for public offering, net, shares | 3,600,000 | ||||||
Issuance of common shares and warrants issued for public offering, net, amount | 3,409,600 | $ 0 | $ 359 | $ 0 | 3,409,241 | 0 | 0 |
Underwriter Warrants | 4,098 | $ 0 | $ 0 | $ 0 | 4,098 | 0 | 0 |
Balance, shares at Sep. 30, 2019 | 27,267,197 | ||||||
Balance, amount at Sep. 30, 2019 | 7,110,790 | $ 0 | $ 2,726 | $ 0 | 90,094,006 | (82,985,942) | $ 0 |
Balance, shares at Dec. 31, 2019 | 27,410,512 | ||||||
Balance, amount at Dec. 31, 2019 | (32,704,641) | $ 2,740 | 90,326,104 | (123,033,485) | |||
Net loss | (3,261,368) | 0 | (3,261,368) | ||||
Issuance of Warrants in conjunction with Convertible Notes | 552,562 | 0 | 552,562 | 0 | |||
Amortization of Warrant and Option Expense | 0 | $ 0 | 115,025 | (115,025) | |||
Balance, shares at Mar. 31, 2020 | 27,410,512 | ||||||
Balance, amount at Mar. 31, 2020 | (35,413,447) | $ 2,740 | 90,993,691 | (126,409,878) | |||
Balance, shares at Dec. 31, 2019 | 27,410,512 | ||||||
Balance, amount at Dec. 31, 2019 | (32,704,641) | $ 2,740 | 90,326,104 | (123,033,485) | |||
Beneficial conversion on note payable due to modification | 0 | ||||||
Net loss | (1,829,148) | ||||||
Warrant modification Expense | 0 | ||||||
Issuance of Warrants in conjunction with Convertible Notes | 1,223,700 | ||||||
Balance, shares at Sep. 30, 2020 | 26,040,512 | ||||||
Balance, amount at Sep. 30, 2020 | (33,576,931) | $ 2,839 | 91,397,889 | (124,977,659) | |||
Balance, shares at Mar. 31, 2020 | 27,410,512 | ||||||
Balance, amount at Mar. 31, 2020 | (35,413,447) | $ 2,740 | 90,993,691 | (126,409,878) | |||
Net loss | 1,308,237 | 0 | 1,308,237 | ||||
Issuance of Warrants in conjunction with Convertible Notes | 671,138 | 671,138 | |||||
Amortization of Warrant and Option Expense | 115,025 | 1 | 115,025 | 0 | |||
Common Stock Issuances | 0 | $ 0 | 0 | 0 | |||
April 1 600,000 for loan modification, shares | 600,000 | ||||||
April 1 600,000 for loan modification, amount | 642,060 | $ 60 | 642,000 | 0 | |||
May 8 Return of 2,000,000 shares for Empire, shares | (2,000,000) | ||||||
May 8 Return of 2,000,000 shares for Empire, amount | (1,840,200) | $ (200) | (1,840,000) | 0 | |||
May 26 20,000 for Investor Relations Contract, shares | 20,000 | ||||||
May 26 20,000 for Investor Relations Contract, amount | 18,800 | $ 2 | 18,798 | 0 | |||
June 11 10,000 warrants exercised for cash, shares | 1,000 | ||||||
June 11 10,000 warrants exercised for cash, amount | 10,500 | $ 1 | 10,499 | 0 | |||
Balance, shares at Jun. 30, 2020 | 26,040,512 | ||||||
Balance, amount at Jun. 30, 2020 | (34,487,887) | $ 2,603 | 90,611,151 | (125,101,641) | |||
Net loss | 123,982 | 123,982 | |||||
Issuance of Warrants in conjunction with Convertible Notes | 371,371 | 3,713,711 | 0 | ||||
July Warrants Exercised, Shares | |||||||
July Warrants Exercised | 293,895 | $ 29 | 293,866 | 0 | |||
Conversion of Senior Convertible Notes, Shares | |||||||
Conversion of Senior Convertible Notes | 20,093 | $ 2 | 20,091 | 0 | |||
Conversion of Senior Convertible Notes One, Amount | $ 205 | (205) | |||||
Conversion of Senior Convertible Notes One, Shares | |||||||
Amortization of Warrant and Stock Option Expense | 101,615 | 101,615 | |||||
Balance, shares at Sep. 30, 2020 | 26,040,512 | ||||||
Balance, amount at Sep. 30, 2020 | $ (33,576,931) | $ 2,839 | $ 91,397,889 | $ (124,977,659) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS UNAUDITED - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash Flows from Operating activities: | ||
Net loss | $ (1,829,148) | $ (30,870,759) |
Adjustments to reconcile loss to net cash | ||
Depreciation | 1,855,236 | 3,036,747 |
Amortization of mining rights | 939,672 | 1,592,110 |
Accretion expense | 981,859 | 962,699 |
Cancelation of debt | 0 | 0 |
Liabilities reduced due to sale of assets | (3,271,973) | 0 |
Recovery of previously impaired receipts | 0 | (50,806) |
Amortization of debt discount | 0 | 7,722,197 |
Warrant expense | 230,050 | 2,528,598 |
Warrant modification expense | 0 | 2,545,360 |
Option expense | 0 | 245,356 |
Issuance of common shares for services | 18,800 | 1,806,040 |
Issuance of common shares for debt settlement | 642,060 | 0 |
Return of common shares for property sale | (1,840,200) | 0 |
Change in current assets and liabilities: | ||
Accounts receivable | 2,378,755 | 1,300,654 |
Inventory | 365,126 | (840,526) |
Prepaid expenses and other assets | (175,000) | (335,174) |
Accounts payable | (303,567) | (2,274,582) |
Funds held for others | 0 | (79,662) |
Due to affiliates | 202,351 | 164,526 |
Accrued interest | (2,296,237) | 858,406 |
Cash used in operating activities | (2,102,216) | (11,688,816) |
Cash Flows from Investing activities: | ||
Cash paid for PPE, net | 0 | (327,250) |
Cash received in asset acquisitions, net | 417,857 | 650,000 |
Cash provided by (used in) investing activities | 417,857 | 322,750 |
Cash Flows from Financing activities: | ||
Principal payments on long term debt | (1,072,745) | (2,548,111) |
Proceeds from long term debt | 28,000 | 5,139,399 |
Proceeds from convertible debt | 3,638,277 | 399,980 |
Proceeds from related party | 0 | 8,639 |
Issuance of warrants in conjunction with convertible notes | 1,223,700 | 0 |
Net proceeds from (payments to) factoring agreement | (1,807,443) | (1,087,413) |
Sale of common stock for cash in connection with public offering | 0 | 4,354,000 |
Sale of common stock for cash issued with warrants in connection with public offering | 0 | 3,409,600 |
Sale of common stock in connection with warrant conversions | 797,475 | 0 |
Cash provided by financing activities | 2,807,264 | 9,676,094 |
Increase (Decrease) in cash and restricted cash | 1,122,905 | (1,689,972) |
Cash and restricted cash, beginning of period | 268,811 | 2,704,799 |
Cash and restricted cash, end of period | 1,391,716 | 1,014,827 |
Supplemental Information | ||
Cash paid for interest | 208,154 | 389,437 |
Cash paid for income taxes | 0 | 0 |
Non-cash investing and financing activities | ||
Shares issued in asset acquisition | 0 | 24,400,000 |
Assumption of net assets and liabilities for asset acquisitions | 0 | 8,787,748 |
Issuance of warrants in conjunction with convertible notes | 1,223,700 | |
Conversion of accounts payable into common shares | 0 | 231,661 |
Beneficial Conversion Feature on note payable due to modification | 0 | 7,362,925 |
Shares issued in connection with note payable | 0 | 297,831 |
Conversion of Series A Preferred into common shares | 0 | 161 |
Conversion of Series C Preferred into common shares | 0 | 1 |
Return of shares related to employee settlement | 0 | 11 |
Warrant exercise for common shares | $ 0 | $ 60 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | American Resources Corporation (ARC or the Company) operates through subsidiaries that were acquired or formed in 2020, 2019, 2018, 2016 and 2015 for the purpose of acquiring, rehabilitating and operating various natural resource assets including coal used in the steel making and industrial markets. Basis of Presentation and Consolidation: The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Quest Energy Inc (QEI), Deane Mining, LLC (Deane), Quest Processing LLC (Quest Processing), ERC Mining Indiana Corp (ERC), McCoy Elkhorn Coal LLC (McCoy), Knott County Coal LLC (KCC), Wyoming County Coal (WCC), Empire Kentucky Land, Inc, Colonial Coal Company, Inc. (Empire), Perry County Resources LLC (PCR), American Rare Earth LLC (ARE) and American Metals LLC (AM). All significant intercompany accounts and transactions have been eliminated. On June 8, 2020, American Rare Earth LLC was created as a wholly owned subsidiary of American Resources Corp for the purpose of developing and monetizing rare earth mineral deposits. On June 28, 2020, American Metals LLC was created as a wholly owned subsidiary of American Resources Corp for the purpose of aggregating, processing and selling recovered steel and metals. The accompanying Consolidated Financial Statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). Interim Financial Information Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020 or any other period. These financial statements should be read in conjunction with the Company’s 2019 audited consolidated financial statements and notes thereto which were filed on Form 10-K on May 29, 2020. Going Concern: Convertible Preferred Securities: Derivatives and Hedging Activities We also follow ASC 480-10, Distinguishing Liabilities from Equity Cash Restricted cash: The balance as of September 30, 2020 and December 31, 2019 was $637,806 and $265,487, respectively. The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that agrees to the total of those amounts as presented in the consolidated statement of cash flows for the nine months ended September 30, 2020 and September 30, 2019. September 30, 2020 September 30, 2019 Cash $ 753,910 $ 716,840 Restricted Cash 637,806 297,987 Total cash and restricted cash presented in the consolidated statement of cash flows $ 1,391,716 $ 1,014,827 Asset Acquisition: On September 23, 2019, American Resources Corporation, (“Buyer”) entered into a binding agreement with Bear Branch Coal LLC, a Kentucky limited liability company, Perry County Coal LLC, a Kentucky limited liability company, Ray Coal LLC, a Kentucky limited liability company, and Whitaker Coal LLC, a Kentucky limited liability company (each a “Seller” and collectively, “Sellers”). The agreement was entered into as part of the bankruptcy proceedings of Cambrian Holding Company LLC, (“Cambrian), and is subject to approval by the United States Bankruptcy Court for the Eastern District of Kentucky (the “Bankruptcy Court”) in the chapter 11 bankruptcy cases of the Sellers, Case No. 19-51200(GRS), by entry of an order in form and substance acceptable to Sellers and Buyer (the “Sale Order). Under the agreement of the Sale Order, each Seller will sell, transfer, assign, convey and deliver to American Resources Corporation, effective as of the Closing, all assets, rights, titles, permits, leases, contracts and interests of such Seller free and clear of all liens, claims, interests and encumbrances, to the fullest extent permitted by the Bankruptcy Court. In consideration for the purchased assets, the Buyer will assume certain liabilities. Additionally, the Buyer will assume all liabilities relating to the transferred permits and the associated reclamation and post-mining liabilities of the purchased assets. On September 26, 2019, the Company received notice that a certain lease assumption as part of the PCR acquisition was being disputed by the lessor. As of the report date, the Company is in the process of transferring the permits. On September 27, 2019, PCR closed and acquired certain assets in exchange for assuming certain liabilities of Perry County Coal, LLC and a cash payment of $1. The preliminary fair values of the asset retirement obligation liabilities assumed were determined to be $2,009,181. Additional assumed liabilities total $1,994,727. The liabilities assumed do not require fair value readjustments. The assets acquired do not represent a business as defined in FASB AS 805-10-20 due to their classification as a single asset. Accordingly, the assets acquired are initially recognized at the consideration paid, which was the liabilities assumed and a cash payment of $1, including direct acquisition costs, of which there were none. The cost is allocated to the group of assets acquired based on their relative fair value. Because the transaction closed near the end of the reporting quarter the values assigned were provisional as of December 31, 2019 while the company continues to gather information, including evaluations of mining permits, discovery of assumed unsecured payables and timing and extent of end of mine life cost. As of September 30, 2020, the values assigned were deemed final. The assets acquired and liabilities assumed of Perry County Coal, LLC were as follows at the purchase date: Assets Coal Inventory $ 523.150 Mine Development 415,984 Coal Refuse 142,443 Land 675,092 Equipment - Underground 692,815 Equipment - Surface 3,763 Processing and Loading Facility 1,550,663 Liabilities Reclamation liability 2,009,181 Accrued liabilities 1,994,727 On March 4, 2020, PCR entered into a sales agreement with an unrelated entity for three non-core permits which were acquired during the initial purchase on September 27, 2019. At the time of the purchase, PCR did not assign any value to the permits as they were not within the company’s plans to operate. The sale of the permits resulted in the release of $2,386,439 of reclamation bonds and $336,995 of asset retirement obligation liability. Consideration received was $700,000 in cash and $300,000 in equipment. The equipment has not been received as of the report date. The transaction resulted in a gain on sale of $1,061,225. On May 8, 2020, the Company entered into a Settlement, Rescission and Mutual Release Agreement with the parties of the Empire acquisition. The agreement provides for the property of Empire to transfer back to the former parties for the return of 2,000,000 common shares of the Company and extinguishment $2,000,000 seller financing note. Additionally, permits and bonding liability associated with the Point Rock Mine were also transferred back to the original permit holders for the consideration of them assuming the reclamation liability. The transaction resulted in a gain on sale of $6,820,949 for the 9 - month period ending September 30, 2020. Asset Retirement Obligations (ARO) – Reclamation: Obligations are reflected at the present value of their future cash flows. We reflect accretion of the obligations for the period from the date they incurred through the date they are extinguished. The asset retirement obligation assets are amortized using the units-of-production method over estimated recoverable (proved and probable) deposits. We are using a discount rate of 10%. Federal and State laws require that mines be reclaimed in accordance with specific standards and approved reclamation plans, as outlined in mining permits. Activities include reclamation of pit and support acreage at surface mines, sealing portals at underground mines, and reclamation of refuse areas and slurry ponds. We assess our ARO at least annually and reflect revisions for permit changes, change in our estimated reclamation costs and changes in the estimated timing of such costs. During the periods ending September 30, 2020 and 2019, $- and $- were incurred for loss on settlement on ARO, respectively. The table below reflects the changes to our ARO: Balance at December 31, 2018 $ 18,538,806 Accretion – nine months September 30, 2019 962,699 Reclamation work – nine months September 30, 2019 - Asset disposition - Gold Star Acquisition 1,300,000 Perry County Acquisition 2,950,761 Balance at September 30, 2019 $ 23,752,266 Balance at December 31, 2019 $ 19,839,782 Accretion – nine months September 30, 2020 981,859 Reclamation work – nine months September 30, 2020 - Asset disposition (3,271,973 ) Balance at September 30, 2020 $ 17,549,668 Revenue Recognition: Revenue is recognized when performance obligations under the terms of a contract with our customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to our customers. For coal shipments to domestic and international customers via rail, control is transferred when the railcar is loaded. Our revenue is comprised of sales of mined coal, sales of recovered metals and services for processing coal. All of the activity is undertaken in eastern Kentucky and Southern Indiana. Revenue from metal recovery and sales are recognized when conditions within the contract or sales agreement are met including transfer of title. Revenue from coal processing and loading are recognized when services have been performed according to the contract in place. Our coal sales generally include 10 to 30-day payment terms following the transfer of control of the goods to the customer. We typically do not include extended payment terms in our contracts with customers. As such, spot sales prices and forward contract pricing has declined. During late 2019 management anticipated adverse market conditions globally, and in response began to selectively reduce or idle coal production operations and furlough or terminate employees. During Q1 2020, the worldwide COVID-19 outbreak sharply reduced worldwide demand for infrastructure and steel products and their necessary inputs including Metallurgical coal. Company management fully idled the Company’s operations accordingly, and the operations have remained idled through the report date. These recent, global market disruptions and developments are expected to result in lower sales and gross margins for the coal industry and the Company in 2020 and possibly beyond. Leases: , Leases . Beneficial Conversion Features of Convertible Securities: The Company has a loan, convertible into common shares at $5.25 per share, with a beneficial conversion feature added through a loan modification on February 4, 2019. At the time of the modification the loan had a maturity date of three months, and the conversions may occur any time from the time of the modification. Allowance For Doubtful Accounts: Allowance for trade receivables as of September 30, 2020 and December 31, 2019 amounted to $0, for both periods. Allowance for other accounts receivables, including note receivables as of September 30, 2020 and December 31, 2019 amounted to $1,494,570 and $0, respectively. The allowance related to the purchase of a note receivable from a third party. The note receivable has collateral in certain mining permits which are strategic to KCC. Timing of payment on the note is uncertain resulting a full allowance for the note. Trade and loan receivables are carried at amortized cost, net of allowance for losses. Amortized cost approximated book value as of September 30, 2020 and December 31, 2019. Reclassifications: |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2020 | |
PROPERTY AND EQUIPMENT | |
NOTE 2 - PROPERTY AND EQUIPMENT | At September 30, 2020 and December 31, 2019, property and equipment were comprised of the following: September 30, 2020 December 31, 2019 Processing and rail facility $ 11,591,273 $ 12,723,163 Underground equipment 6,838,417 8,294,188 Surface equipment 2,527,576 3,224,896 Coal refuse storage 12,134,192 12,171,271 Mine development 561,575 669,860 Land 1,572,435 1,748,169 Less: Accumulated depreciation (11,971,657 ) (11,162,662 ) Total Property and Equipment, Net $ 23,253,811 $ 27,668,885 Depreciation expense amounted to $646,438 and $1,414,942 for the three month periods September 30, 2020 and September 30, 2019, respectively. Depreciation expense amounted to $1,855,236 and $3,036,747 for the nine month periods September 30, 2020 and September 30, 2019, respectively. The estimated useful lives are as follows: Processing and Rail Facilities 20 years Surface Equipment 7 years Underground Equipment 5 years Mining Rights 5-10 years Coal Refuse Storage 10 years |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Sep. 30, 2020 | |
NOTES PAYABLE | |
NOTE 3 - NOTES PAYABLE | During the nine-month period ended September 30, 2020, principal reductions of long term debt totaled $1,072,745. During the nine-month period ended September 30, 2020, increases to long term debt totaled $3,666,277, primarily from the senior convertible debt offering. The senior convertible note has a minimum offering amount of $12,500,000 and maximum of $25,000,000 and minimum investment of $500,000. The notes carry a 24-month term, 12.5% interest 10% warrant coverage and a conversion price of $1.05. The warrants have an exercise price of $1.50. During the nine-month period ended September 30, 2019, principal payments on long term debt totaled $2,548,111. During the nine-month period ended September 30, 2019, increases to long term debt totaled $8,039,379. During the nine-month period ended September 30, 2020, proceeds from the factoring agreement totaled $0 and repayments totaled $1,807,443. During the nine-month period ended September 30, 2019, proceeds from the factoring agreement totaled $16,710,922 and repayments totaled $17,798,335. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2020 | |
RELATED PARTY TRANSACTIONS | |
NOTE 4 - RELATED PARTY TRANSACTIONS | Land Resources & Royalties The Company leases property from Land Resources & Royalties (LRR), an entity controlled by certain members of the Company’s management who are also directors and shareholders. Until July 1, 2018, LRR was consolidated as a VIE resulting in transaction between the two companies to be eliminated upon consolidation. Upon deconsolidation, amounts paid and owed to LRR have been disclosed discreetly in the consolidated financial statements. For the three-month period ending September 30, 2020, royalty expense incurred with LRR amounted to $68,251 and amounts advanced from LRR amounted $25,866 and amounts repaid amounted to $0. For the three-month period ending September 30, 2019, royalty expense incurred with LRR amounted to $112,107 and amounts advanced from LRR amounted to $31,507 and amounts repaid to LRR amounted to $100,000. For the nine-month period ending September 30, 2020, royalty expense incurred with LRR amounted to $149,416 and amounts advanced from LRR amounted $27,769 and amounts repaid amounted to $1,615. For the nine-month period ending September 30, 2019, royalty expense incurred with LRR amounted to $231,685 and amounts advanced from LRR amounted to $137,562 and amounts repaid to LRR amounted to $137,209. As of September 30, 2020, total amounts owed LRR amounted to $979,146. Land Betterment Corp On February 13, 2020, the Company entered into a Contract Services Agreement with Land Betterment Corporation (LBET), an entity controlled by certain members of the Company’s management who are also directors and shareholders. The contract terms state that service costs are passed through to the Company with a 10% mark-up and a 50% share of cost savings which includes payroll covering aforementioned members of the Company’s management. The services agreement covers all of the Company’s properties. For the nine-months ended September 30, 2020 amounts incurred under the agreement amounted to $1,263,766 and amounts paid totaled $864,184. For the nine-months ended September 30, 2020, service charges covering members of the Company’s management amounted to $0. As of September 30, 2020, total amounts owed to LBET amounted to $399,582 which has been included in trade payables. |
EQUITY TRANSACTIONS
EQUITY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2020 | |
EQUITY TRANSACTIONS | |
NOTE 5 - EQUITY TRANSACTIONS | Employee stock compensation expense for the three-month period ending September 30, 2020 and 2019 amounted to $101,615 and $103,060 respectively. Employee stock compensation expense for the nine-month period ending September 30, 2020 and 2019 amounted to $331,665 and $245,354 respectively. Common Share Transactions On April 1, 2020, 600,000 common shares of the company were issued as part of the settlement with ENCECo, Inc. See below. The closing common stock price on this date was $1.07. On May 8, 2020, 2,000,000 common shares of the company were returned as part of the Empire Coal and Point Rock Settlement. See above. The closing common stock price on this date was $0.92 On May 26, 2020, 20,000 common shares of the company were issued as part of an investor relations contract. The contract, dated March 1, 2020 has a three month term, with $7,500 in cash due monthly and the issuance of 20,000 shares that fully vest over the three month term. The contract expired on June 1, 2020 and both parties are working together on renewal terms. The closing common stock price on this date was $0.94 On June 11, 2020, the company received notice of exercise of 10,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $10,500 in cash consideration. On July 6, 2020, the company received notice of exercise of 100,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $105,000 in cash consideration. On July 6, 2020, the company received notice of exercise of 20,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $21,000 in cash consideration. On July 6, 2020, the company received notice of exercise of 40,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $42,000 in cash consideration. On July 7, 2020, the company received notice of exercise of 50,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $52,500 in cash consideration. On July 24, 2020, the company received notice of exercise of 40,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $42,000 in cash consideration. On July 24, 2020, the company received notice of exercise of 29,900 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $31,395 in cash consideration. Warrant Modification On February 3 2020, we entered into a warrant adjustment agreement with Golden Properties Ltd., a British Columbia company based in Vancouver, Canada (“Golden Properties”) to amend warrants “C-1”, “C-2” “C-3”, and “C-4” that were originally part of a October 4, 2017 agreement with Golden Properties that involved a series of loans made by Golden Properties to the Company. As a result, the following warrants modified for Golden Properties: • Warrant C-1, for the purchase of 750,000 shares of common stock at $1.05 per share, as adjusted from time to time, expiring on January 31, 2023, and providing the Company with up to $787,500 in cash proceeds should all the warrants be exercised; • Warrant C-2, for the purchase of 750,000 shares of common stock at $1.05 per share, as adjusted from time to time, expiring on January 31, 2023, and providing the Company with up to $787,500 in cash proceeds should all the warrants be exercised; • Warrant C-3, for the purchase of 750,000 shares of common stock at $1.05 per share, as adjusted from time to time, expiring January 31, 2023, and providing the Company with up to $787,500 in cash proceeds should all the warrants be exercised; and • Warrant C-4, for the purchase of 750,000 shares of common stock at $1.05 per share, as adjusted from time to time, expiring January 31, 2023, and providing the Company with up to $787,500 in cash proceeds should all the warrants be exercised. New Warrant Issuances On February 3, 2020 Warrant C-5 was issued in connection to the conversion of $9,494,073 of outstanding debt into the senior convertible note. Warrant C-5 is for 949,407 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of February 3, 2023. On February 20, 2020 Warrant C-6 was issued in connection to the purchase of $200,000 of the senior convertible notes. Warrant C-6 is for 20,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of February 20, 2022. On April 1, 2020 Warrant C-7 was issued in connection to the conversion of $375,690 of outstanding debt into the senior convertible notes. Warrant C-7 is for 37,569 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-8 was issued in connection to the conversion of $225,000 of outstanding debt into the senior convertible notes. Warrant C-8 is for 22,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-9 was issued in connection to the conversion of $900,000 of outstanding debt into the senior convertible notes. Warrant C-9 is for 90,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-10 was issued in connection to the conversion of $1,888,444 of outstanding debt into the senior convertible notes. Warrant C-10 is for 188,844 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-11 was issued in connection to the conversion of $200,000 of outstanding debt into the senior convertible notes. Warrant C-11 is for 20,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-12 was issued in connection to the conversion of $110,000 of outstanding debt into the senior convertible notes. Warrant C-12 is for 11,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 1, 2020 Warrant C-13 was issued in connection to the purchase of $22,500 of the senior convertible notes. Warrant C-13 is for 2,250 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 1, 2022. On April 14, 2020 Warrant C-15 was issued in connection to the purchase of $53,639 of the senior convertible notes. Warrant C-15 is for 5,364 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 14, 2022. On April 14, 2020 Warrant C-16 was issued in connection to the purchase of $5,000 of the senior convertible notes. Warrant C-16 is for 500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of April 14, 2022. On June 1, 2020 Warrant C-18 was issued in connection to the issuance of $2,000 of the senior convertible notes. Warrant C-18 is for 200 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 1, 2022. On June 5, 2020 Warrant C-27 was issued in connection to the issuance of $2,000 of the senior convertible notes. Warrant C-27 is for 200 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 5, 2022. On June 11, 2020 Warrant C-19 was issued in connection to the issuance of $1,019,573 of the senior convertible notes. Warrant C-19 is for 101,957 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 11, 2022. On June 11, 2020 Warrant C-20 was issued in connection to the issuance of $474,996 of the senior convertible notes. Warrant C-20 is for 47,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 11, 2022. On June 15, 2020 Warrant C-23 was issued in connection to the issuance of $2,000 of the senior convertible notes. Warrant C-23 is for 200 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 15, 2022. On June 16, 2020 Warrant C-24 was issued in connection to the issuance of $12,154 of the senior convertible notes. Warrant C-24 is for 1,215 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 16, 2022. On June 22, 2020 Warrant C-21 was issued in connection to the purchase of $180,000 of the senior convertible notes. Warrant C-21 is for 18,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 30, 2022. On June 23, 2020 Warrant C-25 was issued in connection to the issuance of $2,000 of the senior convertible notes. Warrant C-25 is for 200 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 23, 2022. On June 30, 2020 Warrant C-26 was issued in connection to the issuance of $2,000 of the senior convertible notes. Warrant C-26 is for 200 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 30, 2022. On June 30, 2020 Warrant C-21 was issued in connection to the purchase of $570,000 of the senior convertible notes. Warrant C-21 is for 57,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of June 30, 2022. On August 19, 2020 Warrant C-28 was issued in connection to the purchase of $2,081,273 of the senior convertible notes. Warrant C-22 is for 208,127 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of August 19, 2022. On August 26, 2020 Warrant C-22 was issued in connection to the purchase of $150,000 of the senior convertible notes. Warrant C-22 is for 15,000 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of August 26, 2022. On September 8, 2020 Warrant C-14 was issued in connection to the purchase of $134,367 of the senior convertible notes. Warrant C-14 is for 13,437 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 8, 2022. On September 14, 2020 Warrant C-29 was issued in connection to the purchase of $105,000 of the senior convertible notes. Warrant C-29 is for 10,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 14, 2022. On September 14, 2020 Warrant C-30 was issued in connection to the purchase of $105,000 of the senior convertible notes. Warrant C-30 is for 10,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 14, 2022. On September 16, 2020 Warrant C-31 was issued in connection to the purchase of $105,000 of the senior convertible notes. Warrant C-31 is for 10,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 16, 2022. On September 29, 2020 Warrant C-32 was issued in connection to the purchase of $105,000 of the senior convertible notes. Warrant C-32 is for 10,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 29, 2022. On September 30, 2020 Warrant C-33 was issued in connection to the purchase of $105,000 of the senior convertible notes. Warrant C-33 is for 10,500 warrant shares. The warrants carry an exercise price of $1.50 and an expiration date of September 30, 2022. The table below shows the Black-Scholes option-pricing model inputs used by the Company to value the warrant and option fair value: Warrant and Option Fair Value Inputs September 30, 2020 September 30, 2019 Expected Dividend Yield 0 % 0 % Expected volatility 123-479 % 87.97-97.29 % Risk-free rate 1.40-1.62 % 1.4-1.62 % Expected life of warrants 1.596-6.151 years .43-7.75 years The following is a summary of the Company’s stock warrant activity for the nine months September 30, 2020: Company Warrants: WARRANTS December 31, 2019 to September 30, 2020 Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Warrants Price Life in Years Value Outstanding - December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Exercisable - December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Granted 7,450,900 $ 2.516 - $ - Forfeited or Expired 1,697,223 $ 7.638 - $ - Exercised 600,000 $ 0.010 - $ - Outstanding - September 30, 2019 10,698,904 $ 1.831 2.855 $ 1,633,863 Exercisable - September 30, 2019 10,698,904 $ 1.831 2.855 $ 1,633,863 Exercisable - December 31, 2019 10,689,904 $ 1.856 2.310 $ 1,746,544 Granted 4.952,670 $ 1.217 2.013 $ 1,432,786 Forfeited or Expired 3,172,222 $ 4.443 1.19 $ 706,437 Exercised 2,359,822 $ 0.138 1.37 $ 3,214,338 Outstanding - September 30, 2020 10,119,530 $ 1.114 2.687 $ 5,152,399 Exercisable - September 30, 2020 10,119,530 $ 1.114 2.687 $ 5,152,399 The following is a summary of the Company’s stock option activity for the nine months September 30, 2020: Company Options: OPTIONS December 31, 2019 to September 30, 2020 Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Options Price Life in Years Value Outstanding - December 31, 2018 681,830 $ 1.413 6.447 $ 405,000 Exercisable - December 31, 2018 70,000 $ 4.214 4.247 $ 405,000 Granted 375,000 $ 3.105 - $ - Forfeited or Expired - $ - - $ - Exercised - $ - - $ - Outstanding - September 30, 2019 1,056,830 $ 1.960 6.250 $ - Exercisable - September 30, 2019 273,943 $ 1.821 5.324 $ - Outstanding - December 31, 2019 1,056,830 $ 1.960 5.998 $ - Exercisable - December 31, 2019 273,943 $ 1.821 5.072 $ - Granted 750,000 $ 1.130 6.715 $ 292,500 Forfeited or Expired - $ - - $ - Exercised - $ - - $ - Outstanding - September 30, 2020 1,806,830 $ 1.615 5.856 $ 1,130,333 Exercisable - September 30, 2020 536,220 $ 1.597 4.707 $ 399,489 |
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
CONTINGENCIES | |
NOTE 6 - CONTINGENCIES | In the course of normal operations, the Company is involved in various claims and litigation that management intends to defend. The range of loss, if any, from potential claims cannot be reasonably estimated. However, management believes the ultimate resolution of matters will not have a material adverse impact on the Company’s business or financial position. In the course of normal operations, the Company is involved in various claims and litigation that management intends to defend. The range of loss, if any, from potential claims cannot be reasonably estimated. However, management believes the ultimate resolution of matters will not have a material adverse impact on the Company’s business or financial position. These claims include amounts assessed by the Kentucky Energy Cabinet totaling $1,452,700, the Company has accrued $2,031,314 as a payable to the Commonwealth of Kentucky including amounts owed to the Kentucky Energy Cabinet. Claims assessed by the Mine Health Safety Administration amount to $947,302 of which the Company has accrued $564,560 as a payable. During 2019, McCoy and Deane, received notice of intent to place liens for amounts owed on federal excise taxes. The amounts associated with the notices are included in the company’s trade payables. On November 7, 2018, Wyoming County Coal LLC, acquired 5 permits, coal processing and loading facilities, surface ownership, mineral ownership, and coal refuse storage facilities from unrelated entities. Consideration for the acquired assets was the assumption of reclamation bonds totaling $234,240, 1,727,273 shares of common stock of the company, a seller note of $350,000 and a seller note of $250,000. On September 20, 2019 Wyoming County received a Notice of Breach of the asset purchase agreement between WCC and Synergy Coal, LLC due to consideration of $225,000 not being paid, failure to file for permit transfers and pay delinquent transfer fees of $10,500 and other contract breaches, including failure to transfer reclamation surety bonds. During 2020, WCC has paid the delinquent transfer fees and has filed for permit transfer and the seller note was satisfactorily converted into the AREC’s convertible note offering. As a result of these steps, the seller notified us on May 17, 2020 that all breaches were cured. As of the balance sheet date, the West Virginia permit transfers have not yet been approved, the seller has not been paid cash amounts due, and WCC has not substituted its reclamation surety bonds for the seller’s bond collateral. The Empire acquisition loan in conjunction with the Empire Kentucky Land merger totaling $2,500,000 is due with $500,000 upfront and $2,000,000 due through a $1 per ton royalty off the coal sold from the acquired property and is secured by the underlying property. This note is currently in default and the company received a breach of contract notice in September 2019. On May 8, 2020, the Company entered into a Settlement, Rescission and Mutual Release Agreement with the parties of the Empire acquisition. The agreement provides for the property of Empire to transfer back to the former parties for the return of 2,000,000 common shares of the Company and extinguishment $2,000,000 seller financing note. Additionally, permits and bonding liability associated with the Point Rock Mine were also transferred back to the original permit holders for the consideration of them assuming the reclamation liability. The default was cured on May 8, 2020 through the Settlement, Recission and Mutual Release Agreement. During January 2020, the Company and Sylva International LLC agreed to the termination of a digital marketing consulting services agreement that the Company had entered upon mutually acceptable terms. The company leases various office space some from an entity which was consolidated as a variable interest entity until June 30, 2018 (see note 4). The rental lease for the Company’s former principal office space expired in December 31, 2018 and continued on a month-to-month basis until February 15, 2020. On February 14, the Company moved its principal offices to 12115 Visionary Way Fishers, IN 46038. A lease through December 2026 was executed. We also rent office space from an affiliated entity, LRR, at 11000 Highway 7 South, Kite, Kentucky 41828 and pay $500 per month rent and the rental lease expires October 30, 2021. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
SUBSEQUENT EVENTS | |
NOTE 7 - SUBSEQUENT EVENTS | On October 7, 2020, the company received notice of exercise of 1,441,369 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $1,513,437 in cash consideration. On October 8, 2020, the company received notice of exercise of 72,895 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $76,540 in cash consideration. On October 8, 2020, the Company issued 5,200,000 shares of Class A Common Stock at a price of $2.50 per share in conjunction with its effective S-3/A Registration Statement. Net proceeds to the Company amounted to $12,030,000. On October 9, 2020, the company received notice of exercise of 90,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $26,250 in cash consideration. On October 19, 2020, the company received notice of exercise of 105,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $110,250 in cash consideration. On October 20, 2020, the company received notice of exercise of 45,000 warrant shares of the Company pursuant to the August 27, 2019 Class A Common Stock and Warrant offering. The warrants converted at $1.05 per share and the company received $47,250 in cash consideration. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation and Consolidation | The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Quest Energy Inc (QEI), Deane Mining, LLC (Deane), Quest Processing LLC (Quest Processing), ERC Mining Indiana Corp (ERC), McCoy Elkhorn Coal LLC (McCoy), Knott County Coal LLC (KCC), Wyoming County Coal (WCC), Empire Kentucky Land, Inc, Colonial Coal Company, Inc. (Empire), Perry County Resources LLC (PCR), American Rare Earth LLC (ARE) and American Metals LLC (AM). All significant intercompany accounts and transactions have been eliminated. On June 8, 2020, American Rare Earth LLC was created as a wholly owned subsidiary of American Resources Corp for the purpose of developing and monetizing rare earth mineral deposits. On June 28, 2020, American Metals LLC was created as a wholly owned subsidiary of American Resources Corp for the purpose of aggregating, processing and selling recovered steel and metals. The accompanying Consolidated Financial Statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). |
Interim Financial Information | Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020 or any other period. These financial statements should be read in conjunction with the Company’s 2019 audited consolidated financial statements and notes thereto which were filed on Form 10-K on May 29, 2020. |
Going Concern | The Company has suffered recurring losses from operations and currently has a working capital deficit. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. We plan to generate profits by expanding current coal operations as well as developing new coal operations. However, we will need to raise the funds required to do so through sale of our securities or through loans from third parties. We do not have any commitments or arrangements from any person to provide us with any additional capital. If additional financing is not available when needed, we may need to cease operations. We may not be successful in raising the capital needed to expand or develop operations. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. The accompanying financial statements have been prepared assuming the Company will continue as a going concern; no adjustments to the financial statements have been made to account for this uncertainty. |
Convertible Preferred Securities | We account for hybrid contracts that feature conversion options in accordance with generally accepted accounting principles in the United States. ASC 815, Derivatives and Hedging Activities We also follow ASC 480-10, Distinguishing Liabilities from Equity |
Cash | Cash is maintained in bank deposit accounts which, at times, may exceed federally insured limits. To date, there have been no losses in such accounts. |
Restricted cash | As part of the Kentucky New Markets Development Program an asset management fee reserve was set up in the amount of $116,115. The funds are held to pay annual asset management fees to an unrelated party through 2021. The balance as of September 30, 2020 and December 31, 2019 was $19,138 and $47,897, respectively. The total balance of restricted cash also includes amounts held under the management agreement in the amount of $0 and $82,828, respectively. See note 5 for terms of the management agreement. The balance as of September 30, 2020 and December 31, 2019 includes in the amount of $251,168 and $0, respectively, to pay for assumed liabilities in the PCR asset acquisition. The balance as of September 30, 2020 and December 31, 2019 was $637,806 and $265,487, respectively. The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that agrees to the total of those amounts as presented in the consolidated statement of cash flows for the nine months ended September 30, 2020 and September 30, 2019. September 30, 2020 September 30, 2019 Cash $ 753,910 $ 716,840 Restricted Cash 637,806 297,987 Total cash and restricted cash presented in the consolidated statement of cash flows $ 1,391,716 $ 1,014,827 |
Asset Acquisition | On September 23, 2019, American Resources Corporation, (“Buyer”) entered into a binding agreement with Bear Branch Coal LLC, a Kentucky limited liability company, Perry County Coal LLC, a Kentucky limited liability company, Ray Coal LLC, a Kentucky limited liability company, and Whitaker Coal LLC, a Kentucky limited liability company (each a “Seller” and collectively, “Sellers”). The agreement was entered into as part of the bankruptcy proceedings of Cambrian Holding Company LLC, (“Cambrian), and is subject to approval by the United States Bankruptcy Court for the Eastern District of Kentucky (the “Bankruptcy Court”) in the chapter 11 bankruptcy cases of the Sellers, Case No. 19-51200(GRS), by entry of an order in form and substance acceptable to Sellers and Buyer (the “Sale Order). Under the agreement of the Sale Order, each Seller will sell, transfer, assign, convey and deliver to American Resources Corporation, effective as of the Closing, all assets, rights, titles, permits, leases, contracts and interests of such Seller free and clear of all liens, claims, interests and encumbrances, to the fullest extent permitted by the Bankruptcy Court. In consideration for the purchased assets, the Buyer will assume certain liabilities. Additionally, the Buyer will assume all liabilities relating to the transferred permits and the associated reclamation and post-mining liabilities of the purchased assets. On September 26, 2019, the Company received notice that a certain lease assumption as part of the PCR acquisition was being disputed by the lessor. As of the report date, the Company is in the process of transferring the permits. On September 27, 2019, PCR closed and acquired certain assets in exchange for assuming certain liabilities of Perry County Coal, LLC and a cash payment of $1. The preliminary fair values of the asset retirement obligation liabilities assumed were determined to be $2,009,181. Additional assumed liabilities total $1,994,727. The liabilities assumed do not require fair value readjustments. The assets acquired do not represent a business as defined in FASB AS 805-10-20 due to their classification as a single asset. Accordingly, the assets acquired are initially recognized at the consideration paid, which was the liabilities assumed and a cash payment of $1, including direct acquisition costs, of which there were none. The cost is allocated to the group of assets acquired based on their relative fair value. Because the transaction closed near the end of the reporting quarter the values assigned were provisional as of December 31, 2019 while the company continues to gather information, including evaluations of mining permits, discovery of assumed unsecured payables and timing and extent of end of mine life cost. As of September 30, 2020, the values assigned were deemed final. The assets acquired and liabilities assumed of Perry County Coal, LLC were as follows at the purchase date: Assets Coal Inventory $ 523.150 Mine Development 415,984 Coal Refuse 142,443 Land 675,092 Equipment - Underground 692,815 Equipment - Surface 3,763 Processing and Loading Facility 1,550,663 Liabilities Reclamation liability 2,009,181 Accrued liabilities 1,994,727 On March 4, 2020, PCR entered into a sales agreement with an unrelated entity for three non-core permits which were acquired during the initial purchase on September 27, 2019. At the time of the purchase, PCR did not assign any value to the permits as they were not within the company’s plans to operate. The sale of the permits resulted in the release of $2,386,439 of reclamation bonds and $336,995 of asset retirement obligation liability. Consideration received was $700,000 in cash and $300,000 in equipment. The equipment has not been received as of the report date. The transaction resulted in a gain on sale of $1,061,225. On May 8, 2020, the Company entered into a Settlement, Rescission and Mutual Release Agreement with the parties of the Empire acquisition. The agreement provides for the property of Empire to transfer back to the former parties for the return of 2,000,000 common shares of the Company and extinguishment $2,000,000 seller financing note. Additionally, permits and bonding liability associated with the Point Rock Mine were also transferred back to the original permit holders for the consideration of them assuming the reclamation liability. The transaction resulted in a gain on sale of $6,820,949 for the 9 - month period ending September 30, 2020. |
Asset Retirement Obligations (ARO) - Reclamation | At the time they are incurred, legal obligations associated with the retirement of long-lived assets are reflected at their estimated fair value, with a corresponding charge to mine development. Obligations are typically incurred when we commence development of underground and surface mines, and include reclamation of support facilities, refuse areas and slurry ponds or through acquisitions. Obligations are reflected at the present value of their future cash flows. We reflect accretion of the obligations for the period from the date they incurred through the date they are extinguished. The asset retirement obligation assets are amortized using the units-of-production method over estimated recoverable (proved and probable) deposits. We are using a discount rate of 10%. Federal and State laws require that mines be reclaimed in accordance with specific standards and approved reclamation plans, as outlined in mining permits. Activities include reclamation of pit and support acreage at surface mines, sealing portals at underground mines, and reclamation of refuse areas and slurry ponds. We assess our ARO at least annually and reflect revisions for permit changes, change in our estimated reclamation costs and changes in the estimated timing of such costs. During the periods ending September 30, 2020 and 2019, $- and $- were incurred for loss on settlement on ARO, respectively. The table below reflects the changes to our ARO: Balance at December 31, 2018 $ 18,538,806 Accretion – nine months September 30, 2019 962,699 Reclamation work – nine months September 30, 2019 - Asset disposition - Gold Star Acquisition 1,300,000 Perry County Acquisition 2,950,761 Balance at September 30, 2019 $ 23,752,266 Balance at December 31, 2019 $ 19,839,782 Accretion – nine months September 30, 2020 981,859 Reclamation work – nine months September 30, 2020 - Asset disposition (3,271,973 ) Balance at September 30, 2020 $ 17,549,668 |
Revenue Recognition | The Company adopted and recognizes revenue in accordance with ASC 606 as of January 1, 2018, using the modified retrospective approach. The Company concluded that the adoption did not change the timing at which the Company historically recognized revenue nor did it have a material impact on its consolidated financial statements. Revenue is recognized when performance obligations under the terms of a contract with our customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to our customers. For coal shipments to domestic and international customers via rail, control is transferred when the railcar is loaded. Our revenue is comprised of sales of mined coal, sales of recovered metals and services for processing coal. All of the activity is undertaken in eastern Kentucky and Southern Indiana. Revenue from metal recovery and sales are recognized when conditions within the contract or sales agreement are met including transfer of title. Revenue from coal processing and loading are recognized when services have been performed according to the contract in place. Our coal sales generally include 10 to 30-day payment terms following the transfer of control of the goods to the customer. We typically do not include extended payment terms in our contracts with customers. As such, spot sales prices and forward contract pricing has declined. During late 2019 management anticipated adverse market conditions globally, and in response began to selectively reduce or idle coal production operations and furlough or terminate employees. During Q1 2020, the worldwide COVID-19 outbreak sharply reduced worldwide demand for infrastructure and steel products and their necessary inputs including Metallurgical coal. Company management fully idled the Company’s operations accordingly, and the operations have remained idled through the report date. These recent, global market disruptions and developments are expected to result in lower sales and gross margins for the coal industry and the Company in 2020 and possibly beyond. |
Leases | In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016-02 , Leases . |
Beneficial Conversion Features of Convertible Securities | Conversion options that are not bifurcated as a derivative pursuant to ASC 815 and not accounted for as a separate equity component under the cash conversion guidance are evaluated to determine whether they are beneficial to the investor at inception (a beneficial conversion feature) or may become beneficial in the future due to potential adjustments. The beneficial conversion feature guidance in ASC 470-20 applies to convertible stock as well as convertible debt which are outside the scope of ASC 815. A beneficial conversion feature is defined as a nondetachable conversion feature that is in the money at the commitment date. In addition, our preferred stock issues contain conversion terms that may change upon the occurrence of a future event, such as antidilution adjustment provisions. The beneficial conversion feature guidance requires recognition of the conversion option’s in-the-money portion, the intrinsic value of the option, in equity, with an offsetting reduction to the carrying amount of the instrument. The resulting discount is amortized as a dividend over either the life of the instrument, if a stated maturity date exists, or to the earliest conversion date, if there is no stated maturity date. If the earliest conversion date is immediately upon issuance, the dividend must be recognized at inception. When there is a subsequent change to the conversion ratio based on a future occurrence, the new conversion price may trigger the recognition of an additional beneficial conversion feature on occurrence. The Company has a loan, convertible into common shares at $5.25 per share, with a beneficial conversion feature added through a loan modification on February 4, 2019. At the time of the modification the loan had a maturity date of three months, and the conversions may occur any time from the time of the modification. |
Allowance For Doubtful Accounts | The Company recognizes an allowance for losses on trade and other accounts receivable in an amount equal to the estimated probable losses net of recoveries. The allowance is based on an analysis of historical bad debt experience, current receivables aging and expected future write-offs, as well as an assessment of specific identifiable amounts considered at risk or uncollectible. Allowance for trade receivables as of September 30, 2020 and December 31, 2019 amounted to $0, for both periods. Allowance for other accounts receivables, including note receivables as of September 30, 2020 and December 31, 2019 amounted to $1,494,570 and $0, respectively. The allowance related to the purchase of a note receivable from a third party. The note receivable has collateral in certain mining permits which are strategic to KCC. Timing of payment on the note is uncertain resulting a full allowance for the note. Trade and loan receivables are carried at amortized cost, net of allowance for losses. Amortized cost approximated book value as of September 30, 2020 and December 31, 2019. |
Reclassifications | Reclassifications of prior periods have been made to conform with current year presentation. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Schedule of restricted cash and cash equivalents | September 30, 2020 September 30, 2019 Cash $ 753,910 $ 716,840 Restricted Cash 637,806 297,987 Total cash and restricted cash presented in the consolidated statement of cash flows $ 1,391,716 $ 1,014,827 |
Schedule of Asset Retirement Obligations | Balance at December 31, 2018 $ 18,538,806 Accretion – nine months September 30, 2019 962,699 Reclamation work – nine months September 30, 2019 - Asset disposition - Gold Star Acquisition 1,300,000 Perry County Acquisition 2,950,761 Balance at September 30, 2019 $ 23,752,266 Balance at December 31, 2019 $ 19,839,782 Accretion – nine months September 30, 2020 981,859 Reclamation work – nine months September 30, 2020 - Asset disposition (3,271,973 ) Balance at September 30, 2020 $ 17,549,668 |
Perry County Coal, LLC [Member] | |
Schedule of assets acquired and liabilities assumed | Assets Coal Inventory $ 523.150 Mine Development 415,984 Coal Refuse 142,443 Land 675,092 Equipment - Underground 692,815 Equipment - Surface 3,763 Processing and Loading Facility 1,550,663 Liabilities Reclamation liability 2,009,181 Accrued liabilities 1,994,727 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
PROPERTY AND EQUIPMENT | |
Schedule of property, plant and equipment | September 30, 2020 December 31, 2019 Processing and rail facility $ 11,591,273 $ 12,723,163 Underground equipment 6,838,417 8,294,188 Surface equipment 2,527,576 3,224,896 Coal refuse storage 12,134,192 12,171,271 Mine development 561,575 669,860 Land 1,572,435 1,748,169 Less: Accumulated depreciation (11,971,657 ) (11,162,662 ) Total Property and Equipment, Net $ 23,253,811 $ 27,668,885 |
Schedule of property, plant and equipment, estimated useful lives | Processing and Rail Facilities 20 years Surface Equipment 7 years Underground Equipment 5 years Mining Rights 5-10 years Coal Refuse Storage 10 years |
EQUITY TRANSACTIONS (Tables)
EQUITY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
EQUITY TRANSACTIONS | |
Schedule of Stockholders' Equity Note, Warrants | September 30, 2020 September 30, 2019 Expected Dividend Yield 0 % 0 % Expected volatility 123-479 % 87.97-97.29 % Risk-free rate 1.40-1.62 % 1.4-1.62 % Expected life of warrants 1.596-6.151 years .43-7.75 years |
Schedule of assumptions used to messure fair value of warrants/rights | Company Warrants: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Warrants Price Life in Years Value Outstanding - December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Exercisable - December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Granted 7,450,900 $ 2.516 - $ - Forfeited or Expired 1,697,223 $ 7.638 - $ - Exercised 600,000 $ 0.010 - $ - Outstanding - September 30, 2019 10,698,904 $ 1.831 2.855 $ 1,633,863 Exercisable - September 30, 2019 10,698,904 $ 1.831 2.855 $ 1,633,863 Exercisable - December 31, 2019 10,689,904 $ 1.856 2.310 $ 1,746,544 Granted 4.952,670 $ 1.217 2.013 $ 1,432,786 Forfeited or Expired 3,172,222 $ 4.443 1.19 $ 706,437 Exercised 2,359,822 $ 0.138 1.37 $ 3,214,338 Outstanding - September 30, 2020 10,119,530 $ 1.114 2.687 $ 5,152,399 Exercisable - September 30, 2020 10,119,530 $ 1.114 2.687 $ 5,152,399 Company Options: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Options Price Life in Years Value Outstanding - December 31, 2018 681,830 $ 1.413 6.447 $ 405,000 Exercisable - December 31, 2018 70,000 $ 4.214 4.247 $ 405,000 Granted 375,000 $ 3.105 - $ - Forfeited or Expired - $ - - $ - Exercised - $ - - $ - Outstanding - September 30, 2019 1,056,830 $ 1.960 6.250 $ - Exercisable - September 30, 2019 273,943 $ 1.821 5.324 $ - Outstanding - December 31, 2019 1,056,830 $ 1.960 5.998 $ - Exercisable - December 31, 2019 273,943 $ 1.821 5.072 $ - Granted 750,000 $ 1.130 6.715 $ 292,500 Forfeited or Expired - $ - - $ - Exercised - $ - - $ - Outstanding - September 30, 2020 1,806,830 $ 1.615 5.856 $ 1,130,333 Exercisable - September 30, 2020 536,220 $ 1.597 4.707 $ 399,489 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Sep. 30, 2020 | Sep. 30, 2019 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Cash | $ 753,910 | $ 716,840 |
Restricted Cash | 637,806 | 297,987 |
Total cash and restricted cash presented in the consolidated statement of cash flows | $ 1,391,716 | $ 1,014,827 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Assets | ||
Equipment - Underground | $ 6,838,417 | $ 8,294,188 |
Liabilities | ||
Reclamation liability | 2,327,169 | 2,327,169 |
Accrued liabilities | 573,526 | $ 2,869,763 |
Perry County Coal, LLC [Member] | ||
Assets | ||
Coal Inventory | 523,150 | |
Mine Development | 415,984 | |
Coal Refuse | 142,443 | |
Land | 675,092 | |
Equipment - Underground | 692,815 | |
Equipment - Surface | 3,763 | |
Processing and Loading Facility | 1,550,663 | |
Liabilities | ||
Reclamation liability | 2,009,181 | |
Accrued liabilities | $ 1,994,727 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Beginning Balance | $ 19,839,782 | $ 18,538,806 |
Accretion | 981,859 | 962,699 |
Reclamation work | 0 | 0 |
Gold Star Acquisitions | 1,300,000 | |
Perry County Acquisition | 2,950,761 | |
Asset disposition | (3,271,973) | 0 |
Ending Balance | $ 17,549,668 | $ 23,752,266 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Dec. 31, 2019 | May 08, 2020 | Sep. 30, 2019 | Feb. 04, 2019 | |
Asset management fee reserve | $ 116,115 | ||||
Common stock price per share | $ 5.25 | ||||
Loss on settlement on ARO | $ 0 | $ 0 | |||
Discount rate on federal and state laws | 10.00% | ||||
Assumed liability - Total | $ 251,168 | 0 | |||
Allowance for trade receivables | 0 | 0 | |||
Allowance for other accounts receivables | 1,494,570 | 0 | |||
Restricted cash | 637,806 | $ 297,987 | |||
Cash received | 753,910 | 3,324 | |||
Kentucky Energy Cabinet [Member] | |||||
Restricted cash | 19,138 | 47,987 | |||
Mutual Release Agreement [Member] | |||||
Common stock shares issued, transfer back of property | 2,000,000 | ||||
Extinguishment of financing note | $ 2,000,000 | ||||
Gain on sale | 6,820,949 | ||||
Perry County Resources LLC (PCR) [Member] | |||||
Restricted cash | 637,806 | 265,487 | |||
Amount held under management agreement | 0 | $ 82,828 | |||
Perry County Resources LLC (PCR) [Member] | March 4, 2020 [Member] | |||||
Reclamation bond | 2,386,439 | ||||
Retirement obligations | 336,995 | ||||
Cash received | 700,000 | ||||
Equipment received (as payment) | 300,000 | ||||
Gain on sale of permits | 1,061,225 | ||||
Perry County Resources LLC (PCR) [Member] | September 27, 2019 [Member] | Assets Acquisition [Member] | |||||
Assumed liability - Total | 1,994,727 | ||||
Fair value of assumed liability | $ 2,009,181 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Less: Accumulated depreciation | $ (11,971,657) | $ (11,162,662) |
Total Property and Equipment, Net | 23,253,811 | 27,668,885 |
Underground equipment [Member] | ||
Property and equipment | 6,838,417 | 8,294,188 |
Surface equipment [Member] | ||
Property and equipment | 2,527,576 | 3,224,896 |
Mine development [Member] | ||
Property and equipment | 561,575 | 669,860 |
Processing and rail facilities [Member] | ||
Property and equipment | 11,591,273 | 12,723,163 |
Coal refuse storage [Member] | ||
Property and equipment | 12,134,192 | 12,171,271 |
Land [Member] | ||
Property and equipment | $ 1,572,435 | $ 1,748,169 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details 1) | 9 Months Ended |
Sep. 30, 2020 | |
Surface equipment [Member] | |
Estimated useful lives | 7 years |
Underground equipment [Member] | |
Estimated useful lives | 5 years |
Mining Rights [Member] | Minimum [Member] | |
Estimated useful lives | 5 years |
Mining Rights [Member] | Maximum [Member] | |
Estimated useful lives | 10 years |
Processing and rail facilities [Member] | |
Estimated useful lives | 20 years |
Coal refuse storage [Member] | |
Estimated useful lives | 10 years |
PROPERTY AND EQUIPMENT (Detai_3
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
PROPERTY AND EQUIPMENT | ||||
Depreciation expense | $ 646,438 | $ 1,414,942 | $ 1,855,236 | $ 3,036,747 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
NOTES PAYABLE (Details Narrative) | ||
Repayment on long term debt | $ 1,807,443 | $ 17,798,335 |
Principal payment on long term debt | 2,548,111 | |
Description of Notes and loan payable | The senior convertible note has a minimum offering amount of $12,500,000 and maximum of $25,000,000 and minimum investment of $500,000. The notes carry a 24-month term, 12.5% interest 10% warrant coverage and a conversion price of $1.05. The warrants have an exercise price of $1.50. | |
Increases to long term debt | $ 3,666,277 | 8,039,379 |
Proceeds from the factoring agreement | 0 | $ 16,710,922 |
Principal reduction on long term debt | $ 1,072,745 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Royalty expense | $ 154,604 | $ 948,148 | $ 404,660 | $ 2,811,691 |
LRR [Member] | ||||
Total amount owned from related party | 979,146 | 979,146 | ||
Royalty expense | 68,251 | 112,107 | 149,416 | 231,685 |
Repayment of related party | 0 | 100,000 | 1,615 | 137,209 |
Advance from related party | 25,866 | $ 31,507 | 27,769 | $ 137,562 |
Land Betterment Corporation [Member] | Contract Services Agreement [Member] | ||||
Total amount owned from related party | $ 399,582 | 399,582 | ||
Total amount incurred | 1,263,766 | |||
Service charges paid | $ 864,184 | |||
Terms of contract, Description | The contract terms state that service costs are passed through to the Company with a 10% mark-up and a 50% share of cost savings | |||
Management service charges | $ 0 |
EQUITY TRANSACTIONS (Details)
EQUITY TRANSACTIONS (Details) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Expected Dividend Yield | 0.00% | 0.00% |
Minimum [Member] | ||
Expected volatility | 123.00% | 87.97% |
Risk-free rate | 1.40% | 1.40% |
Expected life of warrants | 1 year 7 months 5 days | 5 months 5 days |
Maximum [Member] | ||
Expected volatility | 479.00% | 97.29% |
Risk-free rate | 1.62% | 1.62% |
Expected life of warrants | 6 years 1 month 25 days | 7 years 8 months 30 days |
EQUITY TRANSACTIONS (Detail 1)
EQUITY TRANSACTIONS (Detail 1) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Aggregate Intrinsic Value [Member] | ||
Outstanding Balance Intrinsic | $ 1,746,544 | $ 42,063,228 |
Beginning Exercisable (Vested) weighted Average | 42,063,228 | |
Granted, Aggregate Intrinsic Value | 1,432,786 | 0 |
Forfeited or Expired, Aggregate Intrinsic Value | 706,437 | 0 |
Exercisable (Vested) Ending Weighted Average | 5,152,399 | 1,633,863 |
Ending Balance option, Aggregate Intrinsic Value | 1,806,830 | |
Ending Balance Intrinsic | $ 5,152,399 | $ 1,633,863 |
Weighted Average Contractual Life in Years [Member] | ||
Outstanding Balance Weighted Average | 2 years 3 months 22 days | 1 year 8 months 14 days |
Beginning Exercisable (Vested) weighted Average | 1 year 8 months 14 days | |
Forfeited or Expired | 1 year 2 months 9 days | |
Granted | 2 years 5 days | |
Exercised | 1 year 4 months 12 days | |
Ending Balance Weighted Average | 2 years 8 months 7 days | 2 years 10 months 8 days |
Exercisable (Vested) Ending Weighted Average | 2 years 8 months 7 days | 2 years 10 months 8 days |
Weighted Average Exercise Price [Member] | ||
Beginning Outstanding Exercise | $ 1.856 | $ 2.745 |
Exercisable (Vested) beginning Exercise | 2.745 | |
Exercised, Weighted Average Exercise Price | 0.138 | 0.010 |
Forfeited or Expired, Weighted Average Exercise Price | 4.443 | 7.638 |
Granted | 1.217 | 2.516 |
Ending Balance Exercise | 1.114 | 1.831 |
Ending Exercisable (Vested) Exercise | $ 1.114 | $ 1.831 |
Warrants [Member] | ||
Exercisable beginning Exercise | 10,689,904 | 5,545,227 |
Beginning Exercisable option | 5,545,227 | |
Granted | 4,952,670 | 7,450,900 |
Forfeited or Expired | 3,172,222 | 1,697,223 |
Exercised | 2,359,822 | 600,000 |
Exercisable Ending option | 10,119,530 | 10,698,904 |
Ending Balance option | 10,119,530 | 10,698,904 |
EQUITY TRANSACTIONS (Detail 2)
EQUITY TRANSACTIONS (Detail 2) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Aggregate Intrinsic Value [Member] | ||
Outstanding Balance Intrinsic | $ 0 | $ 405,000 |
Ending Balance Intrinsic | 1,130,333 | 0 |
Ending Exercisable Intrinsic | 399,489 | 0 |
Beginning Exercisable Intrinsic | 0 | 405,000 |
Forfeited or Expired, Aggregate Intrinsic Value | 0 | 0 |
Granted | $ 292,500 | $ 0 |
Weighted Average Contractual Life in Years [Member] | ||
Outstanding Balance Weighted Average | 5 years 11 months 30 days | 6 years 5 months 11 days |
Exerisable beginning weighted average | 5 years 26 days | 4 years 2 months 17 days |
Granted | 6 years 8 months 18 days | |
Ending Balance Weighted Average | 5 years 10 months 8 days | 6 years 2 months 30 days |
Exercisable Ending Weighted Average | 4 years 8 months 15 days | 5 years 3 months 27 days |
Weighted Average Exercise Price [Member] | ||
Exercisable beginning Exercise | $ 1.821 | $ 4.214 |
Beginning Outstanding Exercise | 1.960 | 1.413 |
Granted | 1.130 | 3.105 |
Forfeited or Expired, Weighted Average Exercise Price | 0 | 0 |
Exercised | 0 | 0 |
Ending Outstanding Exercise | 1.615 | 1.960 |
Ending Exercisable Exercise | 1.597 | 1.821 |
Option [Member] | ||
Exercisable beginning Exercise | $ 1,056,830 | $ 681,830 |
Beginning Exercisable option | 273,943 | 70,000 |
Granted | 750,000 | 375,000 |
Forfeited or Expired | ||
Exercised | ||
Exercisable Ending option | 536,220 | 273,943 |
Ending Balance option | 1,806,830 | 1,056,830 |
EQUITY TRANSACTIONS (Details Na
EQUITY TRANSACTIONS (Details Narrative) - USD ($) | Jul. 07, 2020 | Jul. 06, 2020 | Jun. 11, 2020 | Jul. 24, 2020 | May 26, 2020 | Feb. 20, 2020 | Feb. 03, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | May 08, 2020 | Apr. 01, 2020 | Feb. 04, 2019 |
Conversion price | $ 1.05 | $ 1.05 | $ 1.05 | $ 1.05 | ||||||||||
Proceeds from exercise of warrants | 50,000 | 105,000 | 10,500 | 40,000 | ||||||||||
Warrants expected to be vest | $ 52,500 | $ 100,000 | $ 10,000 | $ 42,000 | ||||||||||
Stock based compensation expense | $ 101,615 | $ 103,060 | $ 331,665 | $ 245,354 | ||||||||||
Common stock price | $ 5.25 | |||||||||||||
ENCECo, Inc. [Member] | ||||||||||||||
Common stock price | $ 1.07 | |||||||||||||
Common stock shares issued | 600,000 | |||||||||||||
Empire Coal and Point Rock [Member] | ||||||||||||||
Common stock price | $ 0.92 | |||||||||||||
Common stock shares returned | 2,000,000 | |||||||||||||
Investor relations contract [Member] | ||||||||||||||
Expiration date | Jun. 1, 2020 | |||||||||||||
Warrant issued | 20,000 | |||||||||||||
Periodic payment | $ 7,500 | |||||||||||||
Frequency of periodic payment | Monthly | |||||||||||||
Periodic issuance of fully vested shares | 20,000 | |||||||||||||
Common stock price | $ 0.94 | |||||||||||||
Term of contract | 3 months | |||||||||||||
Warrant C-33[Member] | September 30, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Sep. 30, 2022 | |||||||||||||
Warrant issued | 10,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 105,000 | |||||||||||||
Warrant C-32[Member] | September 29, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Sep. 29, 2022 | |||||||||||||
Warrant issued | 10,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 105,000 | |||||||||||||
Warrant C-31[Member] | September 16, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Sep. 16, 2022 | |||||||||||||
Warrant issued | 10,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 105,000 | |||||||||||||
Warrant C-30 [Member] | September 14, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Sep. 14, 2022 | |||||||||||||
Warrant issued | 10,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 105,000 | |||||||||||||
Warrant C-29 [Member] | September 14, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Sep. 14, 2022 | |||||||||||||
Warrant issued | 10,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 105,000 | |||||||||||||
Warrant C-14 [Member] | September 8, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Aug. 9, 2022 | |||||||||||||
Warrant issued | 13,437 | |||||||||||||
Debt conversion, converted instrument, amount | $ 134,367 | |||||||||||||
Warrant C-28 [Member] | August 19, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Aug. 19, 2022 | |||||||||||||
Warrant issued | 208,127 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,081,273 | |||||||||||||
Warrant 3 [Member] | July 24, 2020 [Member] | ||||||||||||||
Conversion price | $ 1.05 | $ 1.05 | ||||||||||||
Warrants expected to be vest | $ 31,395 | |||||||||||||
Proceeds from exercise of warrants | $ 29,000 | |||||||||||||
Warrant 2 [Member] | July 6, 2020 [Member] | ||||||||||||||
Conversion price | 1.05 | $ 1.05 | ||||||||||||
Proceeds from exercise of warrants | 40,000 | |||||||||||||
Warrants expected to be vest | $ 42,000 | |||||||||||||
Warrant 1 [Member] | July 6, 2020 [Member] | ||||||||||||||
Conversion price | $ 1.05 | $ 1.05 | ||||||||||||
Proceeds from exercise of warrants | 20,000 | |||||||||||||
Warrants expected to be vest | $ 21,000 | |||||||||||||
Warrant C-21 [Member] | June 30, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 30, 2022 | |||||||||||||
Warrant issued | 57,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 570,000 | |||||||||||||
Warrant C-21 [Member] | June 22, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 30, 2022 | |||||||||||||
Warrant issued | 18,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 180,000 | |||||||||||||
Warrant C-26 [Member] | June 30, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 30, 2022 | |||||||||||||
Warrant issued | 200 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,000 | |||||||||||||
Warrant C-25 [Member] | June 23, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 23, 2022 | |||||||||||||
Warrant issued | 200 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,000 | |||||||||||||
Warrant C-24 [Member] | June 16, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 16, 2022 | |||||||||||||
Warrant issued | 1,215 | |||||||||||||
Debt conversion, converted instrument, amount | $ 12,154 | |||||||||||||
Warrant C-23 [Member] | June 15, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 15, 2022 | |||||||||||||
Warrant issued | 200 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,000 | |||||||||||||
Warrant C-20 [Member] | June 11, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 11, 2022 | |||||||||||||
Warrant issued | 47,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 474,996 | |||||||||||||
Warrant C-19 [Member] | June 11, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 11, 2022 | |||||||||||||
Warrant issued | 101,957 | |||||||||||||
Debt conversion, converted instrument, amount | $ 1,019,573 | |||||||||||||
Warrant C-22 [Member] | June 5, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 5, 2022 | |||||||||||||
Warrant issued | 200 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,000 | |||||||||||||
Warrant C-18 [Member] | June 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Jun. 1, 2022 | |||||||||||||
Warrant issued | 200 | |||||||||||||
Debt conversion, converted instrument, amount | $ 2,000 | |||||||||||||
Warrant C-16 [Member] | April 14, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 14, 2022 | |||||||||||||
Warrant issued | 500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 5,000 | |||||||||||||
Warrant C-15 [Member] | April 14, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 14, 2022 | |||||||||||||
Warrant issued | 5,364 | |||||||||||||
Debt conversion, converted instrument, amount | $ 53,639 | |||||||||||||
Warrant C-13 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 2,250 | |||||||||||||
Debt conversion, converted instrument, amount | $ 22,500 | |||||||||||||
Warrant C-12 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 11,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 110,000 | |||||||||||||
Warrant C-11 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 20,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 200,000 | |||||||||||||
Warrant C-10 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 188,844 | |||||||||||||
Debt conversion, converted instrument, amount | $ 1,888,444 | |||||||||||||
Warrant C-9 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 90,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 900,000 | |||||||||||||
Warrant C-8 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 22,500 | |||||||||||||
Debt conversion, converted instrument, amount | $ 225,000 | |||||||||||||
Warrant C-7 [Member] | April 1, 2020 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Apr. 1, 2022 | |||||||||||||
Warrant issued | 37,569 | |||||||||||||
Debt conversion, converted instrument, amount | $ 375,690 | |||||||||||||
Warrant C-6 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Feb. 20, 2022 | |||||||||||||
Warrant issued | 20,000 | |||||||||||||
Debt conversion, converted instrument, amount | $ 200,000 | |||||||||||||
Warrant C-5 [Member] | ||||||||||||||
Exercise price | $ 1.50 | |||||||||||||
Expiration date | Feb. 3, 2023 | |||||||||||||
Warrant issued | 949,407 | |||||||||||||
Debt conversion, converted instrument, amount | $ 9,494,073 | |||||||||||||
Warrant C-4 [Member] | GoldenProperties Ltd. [Member] | ||||||||||||||
Expiration date | Jan. 31, 2023 | |||||||||||||
Price per share | $ 1.05 | |||||||||||||
Future value of shares issuable | $ 787,500 | |||||||||||||
Common stock, shares issuable | 750,000 | |||||||||||||
Warrant C-3 [Member] | GoldenProperties Ltd. [Member] | ||||||||||||||
Expiration date | Jan. 31, 2023 | |||||||||||||
Price per share | $ 1.05 | |||||||||||||
Future value of shares issuable | $ 787,500 | |||||||||||||
Common stock, shares issuable | 750,000 | |||||||||||||
Warrant C-2 [Member] | GoldenProperties Ltd. [Member] | ||||||||||||||
Expiration date | Jan. 31, 2023 | |||||||||||||
Price per share | $ 1.05 | |||||||||||||
Future value of shares issuable | $ 787,500 | |||||||||||||
Common stock, shares issuable | 750,000 | |||||||||||||
Warrant C-1 [Member] | GoldenProperties Ltd. [Member] | ||||||||||||||
Expiration date | Jan. 31, 2023 | |||||||||||||
Price per share | $ 1.05 | |||||||||||||
Future value of shares issuable | $ 787,500 | |||||||||||||
Common stock, shares issuable | 750,000 |
CONTINGENCIES (Details Narrativ
CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | |||
Sep. 20, 2019 | Sep. 30, 2020 | May 08, 2020 | Dec. 31, 2019 | Nov. 07, 2018 | |
Rent payment, monthly | $ 500 | ||||
Frequency of periodic payment | Month-to-month | ||||
Annual rent maturity date | Oct. 30, 2021 | ||||
Accrued payable | $ 573,526 | $ 2,869,763 | |||
Kentucky Energy Cabinet [Member] | |||||
Claims amounts | 1,452,700 | ||||
Kentucky Energy Cabinet [Member] | Commonwealth of Kentucky [Member] | |||||
Accrued payable | 2,031,314 | ||||
Mutual Release Agreement [Member] | |||||
Return of common stock shares issued | 2,000,000 | ||||
Extinguishment of financing note | $ 2,000,000 | ||||
Empire Kentucky [Member] | |||||
Acquisition of assets | 2,500,000 | ||||
Upfront due amount | $ 500,000 | ||||
Debt description | Due with $500,000 upfront and $2,000,000 due through a $1 per ton royalty off the coal sold from the acquired property and is secured by the underlying property | ||||
Mine Health Safety [Member] | |||||
Accrued payable | $ 564,560 | ||||
Claims amounts | $ 947,302 | ||||
Wyoming County Coal LLC [Member] | |||||
Reclamation bonds amount | $ 234,240 | ||||
Reclamation bonds shares | 1,727,273 | ||||
Breach of contract, amount | $ 225,000 | ||||
Transfer fees | $ 10,500 | ||||
Wyoming County Coal LLC [Member] | Seller Note Two [Member] | |||||
Seller note | $ 250,000 | ||||
Wyoming County Coal LLC [Member] | Seller Note One [Member] | |||||
Seller note | $ 350,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - USD ($) | Oct. 09, 2020 | Oct. 08, 2020 | Oct. 07, 2020 | Oct. 20, 2020 | Oct. 19, 2020 |
Conversion price | $ 1.05 | $ 1.05 | $ 1.05 | $ 1.05 | |
Warrants exercised | 90,000 | 1,441,369 | 45,000 | 105,000 | |
Proceeds from issuance of warrant | $ 26,250 | $ 1,513,437 | $ 47,250 | $ 110,250 | |
Warrant 1 [Member] | |||||
Conversion price | $ 2.50 | ||||
Warrants exercised | 5,200,000 | ||||
Proceeds from issuance of warrant | $ 12,030,000 | ||||
Warrant [Member] | |||||
Conversion price | $ 1.05 | ||||
Warrants exercised | 72,895 | ||||
Proceeds from issuance of warrant | $ 76,540 |