Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 13, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | Thunder Mountain Gold Inc | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Entity Central Index Key | 711,034 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Common Stock, Shares Outstanding | 54,680,579 | ||
Entity Public Float | $ 4,599,851 | ||
Entity Incorporation, Date of Incorporation | Nov. 9, 1935 | ||
Trading Symbol | thmg |
Thunder Mountain Gold, Inc. Con
Thunder Mountain Gold, Inc. Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | |
Current assets: | |||
Cash and cash equivalents | $ 108,184 | $ 12,143 | |
Prepaid expenses and other assets | 33,903 | 27,556 | |
Total current assets | 142,087 | 39,699 | |
Property and Equipment: | |||
Land | 280,333 | ||
Equipment, net of accumulated depreciation of $15,047 | 218,918 | ||
Total property and equipment | 499,251 | ||
Investment in Owyhee Gold Trust LLC | 479,477 | 479,477 | |
Mineral interests | [1] | 479,477 | |
Total assets | 1,120,815 | 519,176 | |
Current liabilities: | |||
Accounts payable and other accrued liabilities | 86,813 | 178,786 | |
Accrued related party liability | [2] | 181,313 | 123,038 |
Accrued interest payable to related parties | [3] | 17,723 | |
Deferred payroll | 568,500 | 274,000 | |
Related party notes payable | [3] | 126,576 | 171,076 |
Total current liabilities | 980,925 | 746,900 | |
Accrued reclamation costs | [1] | 65,000 | |
Total liabilities | 1,045,925 | 746,900 | |
Commitments and Contingencies | [4] | 0 | 0 |
Stockholders' equity (deficit): | |||
Preferred stock; $0.0001 par value, 5,000,000 shares authorized; no shares issued or outstanding | 0 | 0 | |
Common stock; $0.001 par value; 200,000,000 shares authorized, 54,680,579 and 44,167,549, respectively shares issued and outstanding | 54,681 | 44,168 | |
Additional paid-in capital | 5,350,513 | 4,193,797 | |
Less: 11,700 shares of treasury stock, at cost | (24,200) | (24,200) | |
Accumulated deficit | (5,484,806) | (4,441,489) | |
Total Thunder Mountain Gold, Inc stockholders' equity (deficit) | (103,812) | (227,724) | |
Noncontrolling interest in Owyhee Gold Trust | [1] | 178,702 | |
Total stockholders' equity (deficit) | 74,890 | (227,724) | |
Total liabilities and stockholders' equity (deficit) | $ 1,120,815 | $ 519,176 | |
[1] | Note 3 | ||
[2] | Note 5 | ||
[3] | Note 4 | ||
[4] | Notes 2, 3 and 9 |
Statement of Financial Position
Statement of Financial Position - Parenthetical - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of financial position | ||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Shares Issued | 54,680,579 | 44,167,549 |
Common Stock, Shares Outstanding | 54,680,579 | 44,167,549 |
Accumulated depreciation | $ 15,047 |
Thunder Mountain Gold, Inc. Co4
Thunder Mountain Gold, Inc. Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Operating expenses: | |||
Exploration | $ 198,527 | $ 166,275 | |
Legal and accounting | 316,966 | 342,982 | |
Management and administrative | 495,292 | 373,976 | |
Depreciation | 15,047 | ||
Total operating expenses | 1,025,832 | 883,233 | |
Other income (expense): | |||
Interest expense, related parties | (17,723) | (71,337) | |
Loss on modification of debt | [1] | (68,726) | |
Foreign exchange gain | 5,238 | 5,661 | |
Total other income (expense) | (12,485) | (134,402) | |
Net Loss | (1,038,317) | (1,017,635) | |
Net Income - noncontrolling interest in Owyhee Gold Trust | 5,000 | ||
Net Loss - Thunder Mountain Gold, Inc. | $ (1,043,317) | $ (1,017,635) | |
Net Loss per common share-basic and diluted | $ (0.02) | $ (0.02) | |
Weighted average common shares outstanding-basic and diluted | 51,375,312 | 43,488,097 | |
[1] | Note 5 |
Thunder Mountain Gold, Inc. Co5
Thunder Mountain Gold, Inc. Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) | Common Stock Shares | Common Stock Amount | Additional Paid-In Capital | Treasury Stock | Stock Subscription Receivable | Accumulated Deficit | Non-Controlling Interest in OGT | Total | ||
Beginning balance, value at Dec. 31, 2014 | $ 40,168 | $ 3,869,071 | $ (24,200) | $ (50,000) | $ (3,423,854) | $ 411,185 | ||||
Beginning balance, shares at Dec. 31, 2014 | 40,167,549 | |||||||||
Stock options issued for services | 60,000 | 60,000 | ||||||||
Received on stock subscription | $ 50,000 | 50,000 | ||||||||
Sale of stock, value | 4,000 | 196,000 | $ 200,000 | |||||||
Sale of stock, stock | 4,000,000 | 4,000,000 | ||||||||
Conversion option associated with debt modification | 68,726 | $ 68,726 | ||||||||
Net income (loss) | (1,017,635) | (1,017,635) | ||||||||
Ending balance, value at Dec. 31, 2015 | 44,168 | 4,193,797 | (24,200) | (4,441,489) | (227,724) | |||||
Ending balance, shares at Dec. 31, 2015 | 44,167,549 | |||||||||
Common stock issued for payments on related parties notes payable, value | 1,020 | 50,980 | 52,000 | |||||||
Common stock issued for payments on related parties notes payable, stock | 1,020,000 | |||||||||
Common stock issued for payments on accounts payable, value | 203 | 20,231 | $ 20,434 | |||||||
Common stock issued for payments on accounts payable, stock | 203,030 | 203,030 | ||||||||
Stock options issued for services | 175,199 | $ 175,199 | ||||||||
Net assets acquired in Owyhee Gold Trust settlement | 275,596 | [1] | $ 173,702 | [1] | 449,298 | |||||
Sale of stock, value | 9,290 | 634,710 | $ 644,000 | |||||||
Sale of stock, stock | 9,290,000 | 5,700,000 | ||||||||
Net income (loss) | (1,043,317) | 5,000 | $ (1,038,317) | |||||||
Ending balance, value at Dec. 31, 2016 | $ 54,681 | $ 5,350,513 | $ (24,200) | $ (5,484,806) | $ 178,702 | $ 74,890 | ||||
Ending balance, shares at Dec. 31, 2016 | 54,680,579 | |||||||||
[1] | Note 3 |
Thunder Mountain Gold, Inc. Co6
Thunder Mountain Gold, Inc. Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Cash flows from operating activities: | |||
Net loss | $ (1,038,317) | $ (1,017,635) | |
Adjustments to reconcile net loss to net cash used by operating activities: | |||
Depreciation | 15,047 | ||
Loss on modification of debt | [1] | 68,726 | |
Stock options issued for services | 175,199 | 60,000 | |
Amortization of related party notes payable discount | 11,565 | ||
Change in: | |||
Prepaid expenses and other assets | (6,347) | (11,630) | |
Accounts payable and other accrued liabilities | (71,539) | 164,627 | |
Accrued related party liability | 58,275 | 123,038 | |
Accrued interest payable to related parties | 17,723 | ||
Deferred payroll | 294,500 | 274,000 | |
Net cash used by operating activities | (555,459) | (327,309) | |
Cash flows from financing activities: | |||
Proceeds from sale of common stock | 285,000 | 200,000 | |
Received on stock subscription | 50,000 | ||
Proceeds from common stock from exercise of warrants | 359,000 | ||
Borrowing on related parties notes payable | 25,000 | 57,460 | |
Payments on related parties notes payable | (17,500) | ||
Net cash provided by financing activities | 651,500 | 307,460 | |
Net increase (decrease) in cash and cash equivalents | 96,041 | (19,849) | |
Cash and cash equivalents, beginning of year | 12,143 | 31,992 | |
Cash and cash equivalents, end of year | 108,184 | 12,143 | |
Noncash financing and investing activities: | |||
Accrued interest payable converted to related parties notes payable | 63,616 | ||
Common stock issued for settlement of accounts payable | 20,434 | ||
Common stock issued for payment of related parties notes payable | 52,000 | ||
Net assets acquired in Owyhee Gold Trust settlement | [2] | $ 449,298 | |
[1] | Note 5 | ||
[2] | Note 3 |
1. Summary of Significant Accou
1. Summary of Significant Accounting Policies and Business Operations | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
1. Summary of Significant Accounting Policies and Business Operations | 1. Summary of Significant Accounting Policies and Business Operations Business Operations Thunder Mountain Gold, Inc. (Thunder Mountain or the Company) was originally incorporated under the laws of the State of Idaho on November 9, 1935, under the name of Montgomery Mines, Inc. In April 1978, the Montgomery Mines Corporation was obtained by a group of the Thunder Mountain property holders and changed its name to Thunder Mountain Gold, Inc., with the primary goal to further develop their holdings in the Thunder Mountain Mining District, located in Valley County, Idaho. Thunder Mountain Gold, Inc. takes its name from the Thunder Mountain Mining District, where its principal lode mining claims were located. For several years, the Companys activities were restricted to maintaining its property position and exploration activities. During 2005, the Company sold its holdings in the Thunder Mountain Mining District. During 2007, the Company acquired the South Mountain Mines property in southwest Idaho and initiated exploration activities on that property, which continue today. Basis of Presentation and Going Concern The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company is an exploration stage company and has historically incurred losses and does not have sufficient cash at December 31, 2016 to fund normal operations for the next 12 months. The Company has no recurring source of revenue and its ability to continue as a going concern is dependent on the Companys ability to raise capital to fund its future exploration and working capital requirements. The Companys plans for the long-term return to and continuation as a going concern include financing the Companys future operations through sales of its common stock and/or debt and the eventual profitable exploitation of its mining properties. Additionally, the current capital markets and general economic conditions in the United States are significant obstacles to raising the required funds. These factors raise substantial doubt about the Companys ability to continue as a going concern. The Company is currently investigating a number of alternatives for raising additional capital with potential investors, lessees and joint venture partners. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. If the going concern basis was not appropriate for these financial statements, adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses and the balance sheet classifications used. Reclassifications Certain reclassifications have been made to conform prior years data to the current presentation. These reclassifications have no effect on previously reported operations, stockholders equity (deficit) or cash flows. Principles of Consolidation The consolidated financial statements include the accounts of the Company; its wholly owned subsidiaries, Thunder Mountain Resources, Inc. and South Mountain Mines, Inc.; and, effective November 6, 2016, a company in which the Company has majority control, Owyhee Gold Trust, LLC (OGT). Intercompany accounts are eliminated in consolidation. The Company has established 75% ownership and full management of OGT. Thus, OGTs financial information is included 100% in the Companys consolidated financial statements as of December 31, 2016. The Companys consolidated financial statements reflect the other investors 25% non-controlling, capped interest in OGT. Due to the status of the Companys investment both before and after the Settlement Agreement, management determined that the settlement should be accounted for as a transaction between companies under common control. See Note 3 for further information. Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions include the carrying value of properties and mineral interests, environmental remediation liabilities, deferred tax assets, stock based compensation and the fair value of financial and derivative instruments. Managements estimates and assumptions are based on historical experience and other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. Cash and cash equivalents For the purposes of the balance sheet and statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be a cash equivalent. Income Taxes The Company recognizes deferred income tax liabilities or assets at the end of each period using the tax rate expected to be in effect when the taxes are actually paid or recovered. A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized. Fair Value Measurements When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date. The Company has no financial assets or liabilities that are adjusted to fair value on a recurring basis. Financial Instruments The Companys financial instruments include cash and cash equivalents and related party notes payable the carrying value of which approximates fair value based on the nature of those instruments. Mineral Interests The Company capitalizes costs for acquiring mineral interests and expenses costs to maintain mineral rights and leases as incurred. Exploration costs are expensed in the period in which they occur. Should a property reach the production stage, these capitalized costs would be amortized using the units-of-production method on the basis of periodic estimates of ore reserves. Mineral properties are periodically assessed for impairment of value and any subsequent losses are charged to operations at the time of impairment. If a property is abandoned or sold, its capitalized costs are charged to operations. Investments in Joint Venture The Companys accounting policy for joint ventures is as follows: 1. The Company uses the cost method when it does not have joint control or significant influence in a joint venture. Under the cost method, these investments are carried at cost. If other than temporary impairment in value is determined, it would then be charged to current net income or loss. 2. If the Company enters into a joint venture in which there is joint control between the parties or the Company has significant influence, the equity method is utilized whereby the Companys share of the ventures earnings and losses is included in the statement of operations as earnings in joint ventures and its investments therein are adjusted by a similar amount. If other than temporary impairment in value is determined, it would then be charged to current net income or loss. In a joint venture where the Company holds more than 50% of the voting interest and has significant influence, the joint venture is typically consolidated with the presentation of non-controlling interest. In determining whether significant influences exist, the Company considers its participation in policy-making decisions and its representation on the ventures management committee. See Note 3 regarding the Companys accounting for its investment in Owyhee Gold Trust, LLC. Reclamation and Remediation The Companys operations have been, and are subject to, standards for mine reclamation that have been established by various governmental agencies. The Company would record the fair value of an asset retirement obligation as a liability in the period in which the Company incurred a legal obligation for the retirement of tangible long-lived assets. A corresponding asset would also be recorded and depreciated over the life of the asset. After the initial measurement of the asset retirement obligation, the liability is adjusted at the end of each reporting period to reflect changes in the estimated future cash flows underlying the obligation. Determination of any amounts recognized upon adoption is based upon numerous estimates and assumptions, including future retirement costs, future inflation rates and the credit-adjusted risk-free interest rates. For non-operating properties, the Company accrues costs associated with environmental remediation obligations when it is probable that such costs will be incurred and they are reasonably estimable. Such costs are based on managements estimate of amounts expected to be incurred when the remediation work is performed. Share-Based Compensation Share-based payments to employees and directors, including grants of employee stock options, are measured at fair value and expensed in the statement of operations over the vesting period. Recent Accounting Pronouncements In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (ASU) No. 2015-17 Income Taxes - Balance Sheet Classification of Deferred Taxes (Topic 740). The update is designed to reduce complexity of reporting deferred income tax liabilities and assets into current and non-current amounts in a statement of financial position. ASU No. 2015-17 requires the presentation of deferred income taxes, changes to deferred tax liabilities and assets be classified as non-current in the statement of financial position. The update is effective for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09 Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The update simplifies the accounting for stock-based compensation, including income tax consequences and balance sheet and cash flow statement classification of awards. The update is effective for fiscal years beginning after December 15, 2016, with early adoption permitted. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The update provides guidance on classification for cash receipts and payments related to eight specific issues. The update is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01 Business Combinations (Topic 805): Clarifying the Definition of a Business. The update clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The update is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company will apply the provisions of the update to potential future acquisitions occurring after the effective date. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. Net Income (Loss) Per Share The Company is required to have dual presentation of basic earnings per share (EPS) and diluted EPS. Basic EPS is computed as net income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is calculated based on the weighted average number of common shares outstanding during the period plus the effect of potentially dilutive common stock equivalents, including options and warrants to purchase the Companys common stock. For year ended December 31, 2016 2015 Stock options 4,515,000 3,990,000 Warrants - 4,365,000 Total possible dilution 4,515,000 8,355,000 |
2. Commitments
2. Commitments | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
2. Commitments | 2. Commitments During 2008 and 2009, three lease arrangements were made with land owners that own land parcels adjacent to the Companys South Mountain patented and unpatented mining claims. The leases were originally for a seven-year period, with annual payments based on $20 per acre. The leases were renewed for an additional 10 years at $30 per acre paid annually, these payments are listed in the table below. The lease payments have no work requirements. Annual Payment Acree Lease (yearly, June) $ 3,390 Lowry Lease (yearly, October) 11,280 Herman Lease (yearly, April) 1,680 Total $16,350 On March 21, 2011, the Company signed an exploration agreement with Newmont Mining Corporation (Newmont) on the Trout Creek Project that significantly expands the Trout Creek target area. Newmonts private mineral package added to the Project surrounds the Companys South Mountain claim group and consists of about 9,565 acres within a thirty-square mile Area of Influence defined in the agreement. Under the terms of the agreement, the Company is responsible for conducting the exploration program and is obligated to expend a minimum of $150,000 over the ensuing two years, with additional expenditures possible in future years. On October 1, 2015, the Company signed an Amendment with Newmont USA Limited that modifies and extends the original Trout Creek Joint Exploration Agreement. The extension allows the Company modified work commitments on the project reducing the annual amount to $150,000 of work obligations by October 31, 2016. On October 27, 2016, the Company decided to terminate the exploration agreement with Newmont in order to concentrate on the Companys finances. The Company still retains 78 unpatented claims (1,600 acres) in Trout Creek of the target area. The Company pays annual fees to BLM of $3,255 and Lander County $940 fees in maintaining the project. See Note 3 regarding royalty requirements for the South Mountain Project. |
3. South Mountain Project
3. South Mountain Project | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
3. South Mountain Project | 3. South Mountain Project On November 8, 2012, the Company, through its wholly-owned subsidiary South Mountain Mines, Inc., (SMMI), and Idaho State Gold Company II, LLC (ISGC II) formed the Owyhee Gold Trust, LLC, (OGT) a limited liability company. The Companys initial contribution in accordance with the Operating Agreement, was the non-cash contribution of its South Mountain Mine property and related mining claims located in southwestern Idaho in Owyhee County which had a carrying value of $479,477 at the date of contribution, but for purposes of the Operating Agreement, valued at $6.725 Million. As its initial contribution to OGT, ISGC II agreed to fund operations totaling $18 million; or $8 million if the Company exercises its option to participate pro-rata after ISGC II expends $8 million and completes work commitments including a Feasibility Study, and a certain amount of required underground core drilling. ISGC II was the initial manager of OGT LLC. Upon payment of $1 million, and a work commitment of $2 million in pre-determined qualifying expenditures not later than December 31, 2014, ISGC II was to receive 2,000 units representing a vested 25% ownership. As of December 31, 2014, none of those ownership units were issued to ISGC II. In 2015 and through November 2016, disagreements between SMMI and ISGC II resulted in litigation about the status of OGT. In November 2016, the parties entered into a Settlement Agreement and Release (Settlement Agreement) with the following key terms: · · · · · · · Prior to 2015, the Company accounted for its investment in OGT using the cost method because it did not have significant influence over OGTs management and operations. Its investment had a carrying value of $479,477 which represented the carrying value of the South Mountain mineral interests that the Company contributed as its initial investment in OGT in 2012. During 2015 and through the settlement date (November, 6, 2016), the Company managed the South Mountain mineral interests and recognized expenses as Company expenses. For the year ending December 31, 2016 and 2015, the Company incurred expenses of $637,075 and $693,592, respectively, relating to the South Mountain project. Included in these amounts are compensation expense for services performed relating to the operation of OGT was $294,500 and $274,000 in 2016 and 2015, respectively. The compensation was earned by three of the Companys officers whose balances at December 31, 2016 are as follows: Eric Jones, President and Chief Executive Officer - $230,000 (2015 $110,000), James Collord, Vice President and Chief Operating Officer - $230,000 (2015 - $110,000), and Larry Thackery, Chief Financial Officer - $108,500 (2015 - $54,000). With the Settlement Agreement signed on November 6, 2016, the Company has established 75% ownership and full management of the property. Thus, OGTs financial information is included 100% in the Companys consolidated financial statements as of December 31, 2016. The Companys consolidated financial statements reflect ISGC IIs 25% non-controlling, and capped interest in OGT. Due to the status of the Companys investment both before and after the Settlement Agreement, management determined that the settlement should be accounted for as a transaction between companies under common control. As a result, the assets of OGT have been recognized in the consolidated financial statements at their net book value. For accounting purposes, OGT was not considered to be a business at the time of settlement thus prior period financial statements have not been recast to consolidate OGT. On the date of the settlement, OGT assets included land, mineral interests, and equipment. Upon gaining control, the original carrying value of the mineral interests of $479,477 before the establishment of OGT in 2012 was deemed to be OGTs carrying value in accordance with accounting guidance. The equipment had a net book value of $601,040 of which $233,965 was transferred to SMMI and the remainder was transferred to ISGC II under the terms of the settlement agreement. Thus OGT had no equipment on the settlement date. Management identified future reclamation costs at the South Mountain site of $65,000 as part of OGTs net assets on settlement date. The carrying value of OGTs net assets consisted of the following on the settlement date after the transfer of equipment: Net Asset Value on Settlement Date SMMI at 75% ISGC II at 25% Land $ 280,333 $ 210,250 $ 70,083 Mineral Interest 479,477 359,608 119,869 Accrued Reclamation (65,000) (48,750) (16,250) Net Assets 694,810 521,108 173,702 OGT equipment transferred to SMMI 233,965 233,965 Investment in OGT eliminated in consolidation with OGT (479,477) (479,477) $ 449,298 $ 275,596 $ 173,702 The total net asset value of $449,298 was recognized as an increase in additional paid in capital. |
4. Property and Equipment
4. Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
4. Property and Equipment | 4. Property and Equipment The Companys property and equipment at December 31, 2016 are as follows: Vehicles $ 22,441 Buildings 65,072 Construction Equipment 87,806 Mining Equipment 58,646 233,965 Accumulated Depreciation (15,047) 218,918 Land 280,333 Total Property and Equipment $ 499,251 The Company had no property and equipment at December 31, 2015. The increase in property in 2016 is due to the OGT settlement (See Note 3). |
5. Related Parties Notes Payabl
5. Related Parties Notes Payable | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
5. Related Parties Notes Payable | 5. Related Parties Notes Payable On December 9, 2014, the Company executed two promissory notes payable to directors, Eric Jones and Jim Collord. The amount of the notes was $25,000 each for a total of $50,000, and identical in terms. The interest rate on these notes is 10% per month of the principal balance. The notes were due in full no later than July 1, 2015 and had a minimum amount due of 5 months of interest if the notes are paid back earlier. The original notes were convertible and contained a beneficial conversion feature of $13,492 which was recognized as a discount on the notes on the date of issuance. The discount was amortized over the note term using the straight-line method, which approximates the effective interest method. For the year ended December 31, 2015, the Company recorded $11,565 in interest expense related to the amortization of the discount. On July 1, 2015, these notes were extended to December 31, 2015. As part of this extension the outstanding interest payable on the notes of $33,616 was added to the principal balance of $50,000 resulting in a new outstanding principal balance of $83,616. The interest charge remained the same, as per the original notes agreement at $5,000 per month. The extension contained a conversion feature. The note holders could convert all of the outstanding principal and interest at 75% of the average closing bid price of the Company for the 20 days prior to the notice of conversion. The fair value of the conversion feature using the Black Scholes model was $ 68,726 . This amount was determined to be substantial under applicable accounting principles requiring the debt amendment to be accounted for as a debt extinguishment. An expense of $ 68,726 was recorded to recognize the loss on modification of debt during the year ended December 31, 2015. During November and December of 2015, Jim Collord and Eric Jones advanced additional funds of $30,000 and $27,460 respectively. On January 18, 2016, the Company initiated a private offering for an aggregate 6,700,000 shares of common stock. In connection with this offering, Jim Collord and Eric Jones exchanged $25,000 each of their related notes payables for a total of 1 million shares. On November 15, 2016, Jim Collord exchanged an additional $2,000 to exercise warrants and received 20,000 shares of common stock. On July 8, 2016, the Company executed two new promissory notes payable to Eric Jones and Jim Collord. The amount of the notes was $15,000 and $10,000, respectively, for a total of $25,000. The terms of these notes are a 2% interest rate accrued per month for a term of two months. During the year ended December 31, 2016, the Company paid $17,500 on Mr. Jones outstanding note balance. At December 31, 2016, the notes payable balances were $56,768 and $69,808 for Mr. Jones and Mr. Collord, respectively. Also at December 31, 2016, accrued interest payable balances were $8,516 and $9,207 for Mr. Jones and Mr. Collord, respectively. These notes originally had a term of two months but were extended to December 31, 2016, and subsequently extended again to December 31, 2017. |
6. Related Party Transactions
6. Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
6. Related Party Transactions | 6. Related Party Transactions: In addition to the related parties notes payable discussed in Note 5, the Company has engaged Baird Hanson LLP (Baird), a company owned by one of the Companys directors, to provide legal services. Legal expenses of $99,000 and $123,038 have been incurred for these services during the year ended December 31, 2016 and December 31, 2015, respectively. During 2016 Baird Hanson LLP received payment on account of $40,725. At December 31, 2016 and December 31, 2015, the amounts due to Baird are $181,313 and $123,038, respectively. |
7. Stockholders' Equity
7. Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
7. Stockholders' Equity | 7. Stockholders Equity The Companys common stock has a par value of $0.001 with 200,000,000 shares authorized. The Company also has 5,000,000 authorized shares of preferred stock with a par value of $0.0001. During the year ended December 31, 2015, the Company sold 4,000,000 shares at $0.05 per share for total proceeds of $200,000. No warrants were issued with the shares. In January 2016, the Company sold 5,700,000 shares of common stock at a rate of $0.05 for $285,000. In addition, Mr. Jones and Mr. Collord exchanged $50,000 of their notes outstanding (see Note 5) into 1,000,000 shares of common stock at the same rate of $0.05 per share. There were no warrants issued with the shares. On May 12, 2016, the Company extended the expiration 4,365,000 outstanding warrants issued during 2014 for an additional six months to November 24, 2016. The Company also reduced the exercise price from $0.15 to $0.10. In 2016, warrant holders exercised 3,590,000 warrants for shares of common stock at a price of $0.10 per share for proceeds of $359,000. In addition, warrants for 203,030 shares of common stock were exercised at $0.10 in exchange for accounts payable balances totaling $20,434. As disclosed in Note 5, Jim Collard exercised warrants for 20,000 shares of common stock in exchange for a $2,000 payment towards his note payable balance. The following is a summary of the Companys outstanding warrants: Shares Weighted Average Exercise Price Outstanding at December 31, 2014 5,015,000 $ 0.15 Warrants Expired June 2015 (650,000) Outstanding at December 31, 2015 4,365,000 0.15 Exercised for cash (3,590,000) Exercised in exchange for accounts payable (203,030) Exercised in exchange for relate party notes payable (20,000) Warrants expired on November 24, 2016 (551,970) Outstanding at December 31, 2016 0 $ - |
8. Stock Options
8. Stock Options | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
8. Stock Options | 8. Stock Options The Company has established a Stock Option Incentive Plan (SIP) to authorize the granting of stock options up to 10 percent of the total number of issued and outstanding shares of common stock to employees, directors and consultants. Upon exercise of options, shares are issued from the available authorized shares of the Company. Option awards are generally granted with an exercise price equal to the fair market value of the Companys stock at the date of grant. In July 2016, the Company granted 2, 525 ,000 stock options to directors, officers, employees and consultants of the Company and its affiliates to purchase common shares of the Company. The options are exercisable on or before July 20, 2021 at a price of $ 0.10 per share. After this grant, the Company has 4,765,000 outstanding stock options that represent 8.7% of the issued and outstanding shares of common stock. On February 6, 2015, the Board approved a grant of one million options to directors, executive officers and other non-employees consultants to purchase common shares of the Company. The granted options were valued and recorded using the Black Scholes model. The Black Scholes calculation on the 1,000,000 options that were issued was a fair value of $0.06 per option ($60,000 in total). The SIP was approved by shareholder vote during the January 20, 2015 annual shareholder meeting. The fair value of the options was determined to be $175,199 and $60,000 in 2016 and 2015, respectively, which was recognized as compensation expense upon the grant date because the options were fully vested. The fair value of each option award was estimated using the Black Scholes model on the date of the grant using the following assumptions: 2016 2015 Stock price $ 0.07 $ 0.06 Exercise price $ 0.10 $ 0.06 Expected volatility 238.9% 230.1% Expected dividends - - Expected terms (in years) 5.0 5.0 Risk-free rate 1.15% 1.31% The following is a summary of the Companys options issued under the Stock Option Incentive Plan: Shares Weighted Average Exercise Price Outstanding and exercisable at December 31, 2014 2,990,000 $0.20 Granted 1,000,000 0.06 Outstanding and exercisable at December 31, 2015 3,990,000 0.17 Expired (2,000,000) (0.27) Granted 2,525,000 0.10 Outstanding and exercisable at December 31, 2016 4,515,000 $ 0.08 The average remaining contractual term of the options outstanding and exercisable at December 31, 2016 was 3.50 years. As of December 31, 2016, options outstanding and exercisable had no aggregate intrinsic value. |
9. Income Taxes
9. Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Notes | |
9. Income Taxes | 9. Income Taxes The Company did not recognize a tax provision or benefit for the years ended December 31, 2016 and 2015 due to ongoing net losses. At December 31, 2016 and 2015, the Company had net deferred tax assets which were fully reserved by valuation allowances due to the likelihood of expiration of these deferred tax benefits. The net deferred tax assets were calculated based on an expected blended future tax rate of 3398% for federal and Idaho state purposes. Significant components of net deferred tax assets at December 31, 2016 and 2015 are as follows: 2016 2015 Deferred tax assets: Net operating loss carryforwards $ 2,688,000 $ 2,304,000 Share-based compensation 64,000 185,000 Deferred salaries 216,000 - Exploration costs 116,800 144,000 3,084,800 2,633,000 Deferred tax liabilities: Investment in OGT LLC (250,000) (197,000) Net deferred tax assets 2,834,800 2,436,000 Less valuation allowance (2,834,800) (2,436,000) Net deferred tax asset $ 0 $ 0 As of December 31, 2016 and 2015, the Company has approximately $6.6 million and $5.9 million, respectively, of federal and state net operating loss carryforwards that expire in 2028 through 2036. The income tax benefit shown in the financial statements for the years ended December 31, 2016 and 2015 differs from the federal statutory rate as follows: 2016 2015 (Provision) benefit at statutory rates 363,400 35.0% $ 351,000 35.0 % State taxes 31,200 3.0% 30,000 3.0 % Financing related adjustments (31,000) 3.1 % Miscellaneous permanent differences 4,200 0.4% - Adjustment to valuation allowance due to expiration of stock options (187,500) (18.1) - - Increase in valuation allowance for increase in net operating losses (211,300) (20.3) (350,000) 34.9 % Total $ 0 - % $ 0 - % The Company has analyzed its filing positions in all jurisdictions where it is required to file income tax returns and found no positions that would require a liability for uncertain income tax benefits to be recognized. The Company is subject to possible tax examinations for the years 2013 through 2016. Prior year tax attributes could be adjusted by taxing authorities. If applicable, the Company will deduct interest and penalties as interest expense on the financial statements. |
1. Summary of Significant Acc16
1. Summary of Significant Accounting Policies and Business Operations: Reclassifications (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Reclassifications | Reclassifications Certain reclassifications have been made to conform prior years data to the current presentation. These reclassifications have no effect on previously reported operations, stockholders equity (deficit) or cash flows. |
1. Summary of Significant Acc17
1. Summary of Significant Accounting Policies and Business Operations: Principles of Consolidation (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company; its wholly owned subsidiaries, Thunder Mountain Resources, Inc. and South Mountain Mines, Inc.; and, effective November 6, 2016, a company in which the Company has majority control, Owyhee Gold Trust, LLC (OGT). Intercompany accounts are eliminated in consolidation. The Company has established 75% ownership and full management of OGT. Thus, OGTs financial information is included 100% in the Companys consolidated financial statements as of December 31, 2016. The Companys consolidated financial statements reflect the other investors 25% non-controlling, capped interest in OGT. Due to the status of the Companys investment both before and after the Settlement Agreement, management determined that the settlement should be accounted for as a transaction between companies under common control. See Note 3 for further information. |
1. Summary of Significant Acc18
1. Summary of Significant Accounting Policies and Business Operations: Accounting Estimates (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Accounting Estimates | Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions include the carrying value of properties and mineral interests, environmental remediation liabilities, deferred tax assets, stock based compensation and the fair value of financial and derivative instruments. Managements estimates and assumptions are based on historical experience and other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates. |
1. Summary of Significant Acc19
1. Summary of Significant Accounting Policies and Business Operations: Cash and Cash Equivalents (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Cash and Cash Equivalents | Cash and cash equivalents For the purposes of the balance sheet and statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be a cash equivalent. |
1. Summary of Significant Acc20
1. Summary of Significant Accounting Policies and Business Operations: Income Taxes (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Income Taxes | Income Taxes The Company recognizes deferred income tax liabilities or assets at the end of each period using the tax rate expected to be in effect when the taxes are actually paid or recovered. A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized. |
1. Summary of Significant Acc21
1. Summary of Significant Accounting Policies and Business Operations: Fair Value Measures (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Fair Value Measures | Fair Value Measurements When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date. The Company has no financial assets or liabilities that are adjusted to fair value on a recurring basis. |
1. Summary of Significant Acc22
1. Summary of Significant Accounting Policies and Business Operations: Mining Properties and Claims (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Mining Properties and Claims | Mineral Interests The Company capitalizes costs for acquiring mineral interests and expenses costs to maintain mineral rights and leases as incurred. Exploration costs are expensed in the period in which they occur. Should a property reach the production stage, these capitalized costs would be amortized using the units-of-production method on the basis of periodic estimates of ore reserves. Mineral properties are periodically assessed for impairment of value and any subsequent losses are charged to operations at the time of impairment. If a property is abandoned or sold, its capitalized costs are charged to operations. |
1. Summary of Significant Acc23
1. Summary of Significant Accounting Policies and Business Operations: Investments in Joint Venture (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Investments in Joint Venture | Investments in Joint Venture The Companys accounting policy for joint ventures is as follows: 1. The Company uses the cost method when it does not have joint control or significant influence in a joint venture. Under the cost method, these investments are carried at cost. If other than temporary impairment in value is determined, it would then be charged to current net income or loss. 2. If the Company enters into a joint venture in which there is joint control between the parties or the Company has significant influence, the equity method is utilized whereby the Companys share of the ventures earnings and losses is included in the statement of operations as earnings in joint ventures and its investments therein are adjusted by a similar amount. If other than temporary impairment in value is determined, it would then be charged to current net income or loss. In a joint venture where the Company holds more than 50% of the voting interest and has significant influence, the joint venture is typically consolidated with the presentation of non-controlling interest. In determining whether significant influences exist, the Company considers its participation in policy-making decisions and its representation on the ventures management committee. See Note 3 regarding the Companys accounting for its investment in Owyhee Gold Trust, LLC. |
1. Summary of Significant Acc24
1. Summary of Significant Accounting Policies and Business Operations: Reclamation and Remediation (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Reclamation and Remediation | Reclamation and Remediation The Companys operations have been, and are subject to, standards for mine reclamation that have been established by various governmental agencies. The Company would record the fair value of an asset retirement obligation as a liability in the period in which the Company incurred a legal obligation for the retirement of tangible long-lived assets. A corresponding asset would also be recorded and depreciated over the life of the asset. After the initial measurement of the asset retirement obligation, the liability is adjusted at the end of each reporting period to reflect changes in the estimated future cash flows underlying the obligation. Determination of any amounts recognized upon adoption is based upon numerous estimates and assumptions, including future retirement costs, future inflation rates and the credit-adjusted risk-free interest rates. For non-operating properties, the Company accrues costs associated with environmental remediation obligations when it is probable that such costs will be incurred and they are reasonably estimable. Such costs are based on managements estimate of amounts expected to be incurred when the remediation work is performed. |
1. Summary of Significant Acc25
1. Summary of Significant Accounting Policies and Business Operations: Share-based Compensation (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Share-based Compensation | Share-Based Compensation Share-based payments to employees and directors, including grants of employee stock options, are measured at fair value and expensed in the statement of operations over the vesting period. |
1. Summary of Significant Acc26
1. Summary of Significant Accounting Policies and Business Operations: Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (ASU) No. 2015-17 Income Taxes - Balance Sheet Classification of Deferred Taxes (Topic 740). The update is designed to reduce complexity of reporting deferred income tax liabilities and assets into current and non-current amounts in a statement of financial position. ASU No. 2015-17 requires the presentation of deferred income taxes, changes to deferred tax liabilities and assets be classified as non-current in the statement of financial position. The update is effective for fiscal years beginning after December 15, 2016. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09 Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The update simplifies the accounting for stock-based compensation, including income tax consequences and balance sheet and cash flow statement classification of awards. The update is effective for fiscal years beginning after December 15, 2016, with early adoption permitted. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The update provides guidance on classification for cash receipts and payments related to eight specific issues. The update is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of implementing this update on the consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01 Business Combinations (Topic 805): Clarifying the Definition of a Business. The update clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The update is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company will apply the provisions of the update to potential future acquisitions occurring after the effective date. Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures. |
1. Summary of Significant Acc27
1. Summary of Significant Accounting Policies and Business Operations: Net Income (loss) Per Share (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Policies | |
Net Income (loss) Per Share | Net Income (Loss) Per Share The Company is required to have dual presentation of basic earnings per share (EPS) and diluted EPS. Basic EPS is computed as net income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is calculated based on the weighted average number of common shares outstanding during the period plus the effect of potentially dilutive common stock equivalents, including options and warrants to purchase the Companys common stock. For year ended December 31, 2016 2015 Stock options 4,515,000 3,990,000 Warrants - 4,365,000 Total possible dilution 4,515,000 8,355,000 |
1. Summary of Significant Acc28
1. Summary of Significant Accounting Policies and Business Operations: Net Income (loss) Per Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | For year ended December 31, 2016 2015 Stock options 4,515,000 3,990,000 Warrants - 4,365,000 Total possible dilution 4,515,000 8,355,000 |
3. South Mountain Project_ Inve
3. South Mountain Project: Investments in and Advances to Affiliates (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Investments in and Advances to Affiliates | Net Asset Value on Settlement Date SMMI at 75% ISGC II at 25% Land $ 280,333 $ 210,250 $ 70,083 Mineral Interest 479,477 359,608 119,869 Accrued Reclamation (65,000) (48,750) (16,250) Net Assets 694,810 521,108 173,702 OGT equipment transferred to SMMI 233,965 233,965 Investment in OGT eliminated in consolidation with OGT (479,477) (479,477) $ 449,298 $ 275,596 $ 173,702 |
4. Property and Equipment_ Prop
4. Property and Equipment: Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Property, Plant and Equipment | Vehicles $ 22,441 Buildings 65,072 Construction Equipment 87,806 Mining Equipment 58,646 233,965 Accumulated Depreciation (15,047) 218,918 Land 280,333 Total Property and Equipment $ 499,251 |
7. Stockholders' Equity_ Schedu
7. Stockholders' Equity: Schedule of Warrants Outstanding (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Warrants Outstanding | Shares Weighted Average Exercise Price Outstanding at December 31, 2014 5,015,000 $ 0.15 Warrants Expired June 2015 (650,000) Outstanding at December 31, 2015 4,365,000 0.15 Exercised for cash (3,590,000) Exercised in exchange for accounts payable (203,030) Exercised in exchange for relate party notes payable (20,000) Warrants expired on November 24, 2016 (551,970) Outstanding at December 31, 2016 0 $ - |
8. Stock Options_ Schedule of S
8. Stock Options: Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | 2016 2015 Stock price $ 0.07 $ 0.06 Exercise price $ 0.10 $ 0.06 Expected volatility 238.9% 230.1% Expected dividends - - Expected terms (in years) 5.0 5.0 Risk-free rate 1.15% 1.31% |
8. Stock Options_ Schedule of33
8. Stock Options: Schedule of Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value | Shares Weighted Average Exercise Price Outstanding and exercisable at December 31, 2014 2,990,000 $0.20 Granted 1,000,000 0.06 Outstanding and exercisable at December 31, 2015 3,990,000 0.17 Expired (2,000,000) (0.27) Granted 2,525,000 0.10 Outstanding and exercisable at December 31, 2016 4,515,000 $ 0.08 |
9. Income Taxes_ Schedule of De
9. Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Deferred Tax Assets and Liabilities | 2016 2015 Deferred tax assets: Net operating loss carryforwards $ 2,688,000 $ 2,304,000 Share-based compensation 64,000 185,000 Deferred salaries 216,000 - Exploration costs 116,800 144,000 3,084,800 2,633,000 Deferred tax liabilities: Investment in OGT LLC (250,000) (197,000) Net deferred tax assets 2,834,800 2,436,000 Less valuation allowance (2,834,800) (2,436,000) Net deferred tax asset $ 0 $ 0 |
9. Income Taxes_ Schedule of Ef
9. Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Tables/Schedules | |
Schedule of Effective Income Tax Rate Reconciliation | 2016 2015 (Provision) benefit at statutory rates 363,400 35.0% $ 351,000 35.0 % State taxes 31,200 3.0% 30,000 3.0 % Financing related adjustments (31,000) 3.1 % Miscellaneous permanent differences 4,200 0.4% - Adjustment to valuation allowance due to expiration of stock options (187,500) (18.1) - - Increase in valuation allowance for increase in net operating losses (211,300) (20.3) (350,000) 34.9 % Total $ 0 - % $ 0 - % |
1. Summary of Significant Acc36
1. Summary of Significant Accounting Policies and Business Operations (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Details | |
Entity Incorporation, Date of Incorporation | Nov. 9, 1935 |
Basis of Accounting | The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company is an exploration stage company and has historically incurred losses and does not have sufficient cash at December 31, 2016 to fund normal operations for the next 12 months. The Company has no recurring source of revenue and its ability to continue as a going concern is dependent on the Company’s ability to raise capital to fund its future exploration and working capital requirements. The Company’s plans for the long-term return to and continuation as a going concern include financing the Company’s future operations through sales of its common stock and/or debt and the eventual profitable exploitation of its mining properties. Additionally, the current capital markets and general economic conditions in the United States are significant obstacles to raising the required funds. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company is currently investigating a number of alternatives for raising additional capital with potential investors, lessees and joint venture partners. |
1. Summary of Significant Acc37
1. Summary of Significant Accounting Policies and Business Operations: Net Income (loss) Per Share: Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Details | ||
Incremental Common Shares Attributable to Dilutive Effect of Call Options and Warrants | 4,515,000 | 3,990,000 |
Incremental Common Shares Attributable to Dilutive Effect of Written Put Options | 4,365,000 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 4,515,000 | 8,355,000 |
2. Commitments (Details)
2. Commitments (Details) - USD ($) | 12 Months Ended | 13 Months Ended | 27 Months Ended |
Dec. 31, 2016 | Oct. 31, 2016 | Mar. 21, 2013 | |
Details | |||
Acree Lease | $ 3,390 | ||
Lowry Lease | 11,280 | ||
Herman Lease | 1,680 | ||
Payments to Acquire Mineral Rights | 16,350 | ||
Minimum expenditure through date | $ 150,000 | $ 150,000 | |
Annual fees to BLM | 3,255 | ||
Annual fees to Lander County | $ 940 |
3. South Mountain Project (Deta
3. South Mountain Project (Details) - USD ($) | Nov. 09, 2012 | Dec. 31, 2016 | Dec. 31, 2015 | |
Contribution of Property | $ 479,477 | |||
Legal Matters and Contingencies | In 2015 and through November 2016, disagreements between SMMI and ISGC II resulted in litigation about the status of OGT. In November 2016, the parties entered into a Settlement Agreement and Release (Settlement Agreement) with the following key terms: · · · · · · · | |||
Contribution of Property | $ 479,477 | |||
Officers' Compensation | $ 274,000 | |||
Officer compensation details, Eric Jones | 110,000 | |||
Officer compensation details, James Collord | 110,000 | |||
Officer compensation details, Larry Thackery | 54,000 | |||
Cost Method Investments, Original Cost | $ 479,477 | |||
Property, Plant and Equipment, Gross | 233,965 | |||
Accrued reclamation costs | [1] | 65,000 | ||
Net assets acquired in Owyhee Gold Trust settlement | [1] | 449,298 | ||
South Mountain mineral interests | ||||
Payments for Operating Activities | 637,075 | $ 693,592 | ||
Officers' Compensation | 294,500 | |||
Officer compensation details, Eric Jones | 230,000 | |||
Officer compensation details, James Collord | 230,000 | |||
Officer compensation details, Larry Thackery | $ 108,500 | |||
[1] | Note 3 |
3. South Mountain Project_ In40
3. South Mountain Project: Investments in and Advances to Affiliates (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Details | |||
Land | $ 280,333 | ||
Mineral interests | [1] | 479,477 | |
Accrued reclamation costs | [1] | (65,000) | |
Net Asset Value on Settlement Date | 694,810 | ||
Property, Plant and Equipment, Gross | 233,965 | ||
Investment in Owyhee Gold Trust LLC | (479,477) | (479,477) | |
Net assets acquired in Owyhee Gold Trust settlement | [1] | $ 449,298 | |
[1] | Note 3 |
4. Property and Equipment_ Pr41
4. Property and Equipment: Property, Plant and Equipment (Details) | Dec. 31, 2016USD ($) |
Details | |
Vehicles | $ 22,441 |
Buildings | 65,072 |
Construction Equipment | 87,806 |
Mining Equipment | 58,646 |
Property, Plant and Equipment, Gross | 233,965 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (15,047) |
Equipment, net of accumulated depreciation of $15,047 | 218,918 |
Land | 280,333 |
Total property and equipment | $ 499,251 |
5. Related Parties Notes Paya42
5. Related Parties Notes Payable (Details) - USD ($) | Nov. 15, 2016 | Jan. 18, 2016 | Dec. 31, 2015 | Jul. 01, 2015 | Dec. 09, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 08, 2016 | |
Related party notes payable | [1] | $ 171,076 | $ 126,576 | $ 171,076 | |||||
Amortization of related party notes payable discount | 11,565 | ||||||||
Notes payable exchanged for shares, shares | $ 20,000 | ||||||||
Payments on related parties notes payable | 17,500 | ||||||||
Notes payable related parties, Jones | 56,768 | ||||||||
Notes payable related parties, Collord | 69,808 | ||||||||
Notes payable related parties, Jones, Interest | 8,516 | ||||||||
Notes payable related parties, Collord, Interest | $ 9,207 | ||||||||
Initial Loan | |||||||||
Related party notes payable | $ 50,000 | ||||||||
Short-term Debt, Weighted Average Interest Rate | 10.00% | ||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 13,492 | ||||||||
Amortization of related party notes payable discount | $ 11,565 | ||||||||
Second loan increase | |||||||||
Related party notes payable | $ 83,616 | ||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | 68,726 | ||||||||
Increase (Decrease) in Notes Payable, Related Parties, Current | 33,616 | ||||||||
Loss on modification of debt | $ 68,726 | ||||||||
Third Loan Increase | |||||||||
Related party notes payable | $ 171,076 | $ 171,076 | |||||||
Short-term Debt, Weighted Average Interest Rate | 1.00% | 1.00% | |||||||
Increase (Decrease) in Notes Payable, Related Parties, Current | $ 30,000 | ||||||||
Participation in private offering | |||||||||
Notes payable exchanged for shares, shares | 20,000 | $ 1,000,000 | |||||||
Notes payable exchanged for shares, value | $ 2,000 | ||||||||
Fourth Loan | |||||||||
Related party notes payable | $ 25,000 | ||||||||
Short-term Debt, Weighted Average Interest Rate | 2.00% | ||||||||
[1] | Note 4 |
6. Related Party Transactions (
6. Related Party Transactions (Details) - Related Party Legal Fees - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Related party legal expenses incurred | $ 99,000 | $ 123,038 |
Related Party Legal Fees Paid | 40,725 | |
Legal fees paid to related party | $ 181,313 | $ 123,038 |
7. Stockholders' Equity (Detail
7. Stockholders' Equity (Details) - USD ($) | Nov. 15, 2016 | Jan. 18, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Feb. 06, 2016 | Feb. 06, 2015 |
Common Stock, Par Value | $ 0.001 | $ 0.001 | ||||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | ||||
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | ||||
Preferred Stock, Par Value | $ 0.0001 | $ 0.0001 | ||||
Sale of stock, stock | 5,700,000 | 4,000,000 | ||||
Sale of Stock, Price Per Share | $ 0.07 | $ 0.06 | ||||
Sale of stock, value | $ 644,000 | $ 200,000 | ||||
Notes payable exchanged for shares, shares | $ 20,000 | |||||
Warrants extended | 4,365,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 3,590,000 | |||||
Stock Issued During Period, Value, Stock Options Exercised | $ 359,000 | |||||
Common stock issued for payments on accounts payable, stock | 203,030 | 203,030 | ||||
Common stock issued for payments on accounts payable, value | $ 20,434 | |||||
Participation in private offering | ||||||
Notes payable exchanged for shares, value | $ 2,000 | |||||
Notes payable exchanged for shares, shares | 20,000 | $ 1,000,000 | ||||
Notes payable exchanged for shares, value | $ 2,000 | |||||
Private placement 2015 | ||||||
Sale of stock, stock | 4,000,000 | |||||
Sale of Stock, Price Per Share | $ 0.05 | |||||
Sale of stock, value | $ 200,000 | |||||
Private placement 2016 | ||||||
Sale of stock, stock | 5,700,000 | |||||
Sale of Stock, Price Per Share | $ 0.05 | |||||
Sale of stock, value | $ 285,000 | |||||
Officer participation in private offering 2016 | ||||||
Sale of Stock, Price Per Share | $ 0.05 | |||||
Notes payable exchanged for shares, value | $ 50,000 | |||||
Notes payable exchanged for shares, shares | 1,000,000 | |||||
Notes payable exchanged for shares, value | $ 50,000 |
7. Stockholders' Equity_ Sche45
7. Stockholders' Equity: Schedule of Warrants Outstanding (Details) - USD ($) | Nov. 15, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Details | ||||
Class of Warrant or Right, Outstanding | 0 | 4,365,000 | 5,015,000 | |
Warrants outstanding, value | $ 0.15 | $ 0.15 | ||
Warrants expired | (551,970) | (650,000) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (3,590,000) | |||
Common stock issued for payments on accounts payable, stock | (203,030) | (203,030) | ||
Notes payable exchanged for shares, shares | $ (20,000) |
8. Stock Options (Details)
8. Stock Options (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 06, 2015 | |
Details | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 2,525,000 | 1,000,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 0.08 | $ 0.17 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 1,000,000 | |||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0.06 | $ 0.06 | ||
Stock options issued for services | $ 175,199 | $ 60,000 | ||
Stock options issued for services | $ 175,199 | $ 60,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 3 years 6 months |
8. Stock Options_ Schedule of47
8. Stock Options: Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Feb. 06, 2016 | Feb. 06, 2015 | |
Details | ||||
Sale of Stock, Price Per Share | $ 0.07 | $ 0.06 | ||
Fair Value Assumptions, Exercise Price | $ 0.10 | $ 0.06 | ||
Fair Value Assumptions, Expected Volatility Rate | 238.90% | 230.10% | ||
Fair Value Assumptions, Expected Term | 5 years | 5 years | ||
Fair Value Assumptions, Risk Free Interest Rate | 1.15% | 1.31% |
8. Stock Options_ Schedule of48
8. Stock Options: Schedule of Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Details | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 4,515,000 | 3,990,000 | 2,990,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 0.20 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 2,525,000 | 1,000,000 | |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0.06 | $ 0.06 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 0.08 | 0.17 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | (2,000,000) | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price | $ (0.27) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures | 2,525,000 | 1,000,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 0.08 | $ 0.17 |
9. Income Taxes_ Schedule of 49
9. Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Details | ||
Deferred Tax Assets, Operating Loss Carryforwards | $ 2,688,000 | $ 2,304,000 |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Share-based Compensation Cost, Amount | 64,000 | 185,000 |
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | 216,000 | (31,000) |
Effective Income Tax Rate Reconciliation, Other Reconciling Items, Amount | 116,800 | 144,000 |
Deferred Tax Assets, Gross | 3,084,800 | 2,633,000 |
Deferred Tax Liabilities, Net | (250,000) | (197,000) |
Deferred Tax Assets, Net | 2,834,800 | 2,436,000 |
Valuation Allowances and Reserves, Balance | (2,834,800) | (2,436,000) |
Deferred Tax Assets, Net of Valuation Allowance | $ 0 | $ 0 |
9. Income Taxes_ Schedule of 50
9. Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Details | ||
Effective Income Tax Rate Reconciliation at Federal Statutory Income Tax Rate, Amount | $ 0.3500 | $ 351,000 |
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Amount | 0.0300 | $ 30,000 |
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Percent | 3.00% | |
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | 216,000 | $ (31,000) |
Effective Income Tax Rate Reconciliation, Deduction, Other, Percent | 3.10% | |
Effective Income Tax Rate Reconciliation, Deduction, Amount | 0.0040 | |
Effective Income Tax Rate Reconciliation, Deduction, Other, Amount | (18.1) | |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount | $ (20.3) | $ (350,000) |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | 34.90% |