NOTE 8 – MINING CONCESSION DUTIES PAYABLE

In June 2018, the Company entered into financing agreements for unpaid mining concession taxes on the Francisco Arturo mining concession for the year ended December 31, 2017 and the period ended June 30, 2018 in the amount of $1,739,392. The Company paid an initial 20% down payment of $347,826 and financed the balance over 36 months at an interest rate of 22% per annum.

In February 2019, the Company entered into a financing agreement for unpaid mining concession taxes on the Francisco Arturo mining concession for the year ended December 31, 2018 in the amount of $335,350. The Company paid an initial 20% down payment of $67,070 and financed the balance over 36 months at an interest rate of 22% per annum.

In June 2018, the Company applied for a reduction of the Francisco Arturo mining concession, from 69,121 hectares to 3,280 hectares. The Company continues to accrue approximately $22,500 (USD) every semester (six months) on the Francisco Arturo mining concession.

As of June 2019, the Company ceased making monthly payments on the Francisco Arturo concession financing notes and petitioned the Servicio de Administración Tributaria (the “SAT”), the Mexican federal tax authority, for a reduction in the liability proportionate to the reduction in the Francisco Arturo concession area. For financial reporting purposes, the Company continues to carry all financing notes related to unpaid mining concession taxes on the Francisco Arturo concessions at their unpaid principal amounts and accrues interest. As of June 30, 2026 and December 31, 2025, $233,177 and $421,245 of accrued interest was included in the concessions duties payable balance.