DEL TORO SILVER CORP. company history: the story so far

History

Del Toro Silver chased a string of small mining-claim deals funded by officer loans and toxic notes, lost its silver project, and deregistered in 2017 with no clear project.

2008-2011: From shell to silver

The company began as Candev Resource Exploration, Inc. On 4 December 2008 it ended its option on the King Claims in British Columbia by mutual agreement. That was its only project, and it said it would look for other business opportunities.

It found one in July 2009. Candev bought a 50% interest, plus an option on a further 30%, in the Dos Naciones silver project in Sonora, Mexico, from Yale Resources for CAD$35,000. Earning the rest required future share issues and CDN$800,000 of exploration spending. The deal ended its status as a shell company and led to its later name, Del Toro Silver Corp.

The warning signs came in September 2011, when it dismissed its auditor, MacKay LLP. MacKay's earlier reports had flagged substantial doubt that the company could keep going. There was no disagreement over accounting.

2011-2013: Big deals that never closed

In November 2011 Del Toro agreed to buy up to 75% of the KM and Raddlefinger claims in Siskiyou County, California, from Bowerman Holdings. The price was $6.525 million: a $4.5 million secured promissory note plus 40 million new shares. That was a huge commitment for a company that had been living on loans of $50,000 to $200,000 from its own officers. In February 2012 it dismissed a second auditor, Saturna Group, which had also flagged going-concern doubt.

In September 2012 it added a third project, an option with Natchez Pass LLC to earn up to 67.5% of a leasehold in Pershing County, Nevada, for $4.005 million in cash plus 5 million shares over five years.

Neither big deal closed. By November 2012 the Bowerman deadline had been pushed back for the fourth time, to May 2013, and in January 2013 the company was paying $7,000 per extension just to keep the Nevada option alive.

Funding came increasingly from outside. In October 2012 it took an 8% $51,500 note from Asher Enterprises, convertible into shares at 58% of market price. Further Asher notes followed in March and April 2013, on terms as steep as 50% of the average of the lowest three trading prices. Such terms get more dilutive as the share price falls. Shares on issue stood at 10,535,135 at the end of 2010 and 21,763,623 at the end of 2013.

2013-2014: Losing the projects

The unwinding came in 2013. On 12 June Del Toro terminated the Natchez Pass option and was released from all obligations. It received a 5% net smelter royalty (a share of future sales revenue) and a 5% share of any sale price, but had to issue 2,000,000 shares, and Natchez Pass kept all money already paid. On 16 September it gave up Dos Naciones and handed its 50% interest back to Alta Vista Ventures, formerly Yale Resources. The company named for silver had no silver project.

Two more Asher notes followed, $51,500 on 31 October and $31,500 on 31 December, on the same death-spiral terms. Only the Bowerman deal survived. It was extended again in May and December 2013, and in September 2014, the last pushing closing to November 2014 with further extension options, three years after signing. Shares on issue reached 24,988,491 at the end of 2014.

2015-2017: Related-party deals and deregistration

The record is quiet for 2015 and most of 2016. In September 2016 Del Toro renewed the Bowerman deal once more, to March 2017, paying for the extension with 1,000,000 shares issued to Bowerman's parent, Trinity Alps Resources. Three days later it settled both outstanding Asher notes for $50,000 cash with mutual releases, ending financing that had diluted shareholders roughly monthly since late 2013.

On 11 October 2016 it took an option, for a $100 deposit, on the Mt. Vernon Mine claims in Sierra County, California, from Lazarus Mining LLC. The filing disclosed that Lazarus was wholly owned and controlled by Patrick Fagen, the company's president, CEO, CFO, secretary, treasurer and director. He had lent the company $55,000 two weeks earlier, so he stood on both sides of its financing and its asset deals.

In March 2017 the company agreed to buy four mining claims in Storey County, Nevada, from Comstock Resources Development LLC for 1,000,000 shares, a 5% smelter royalty and 25% of any future resale proceeds.

On 7 August 2017 Del Toro Silver deregistered its securities, ending its obligation to file reports with the SEC. At that date it held only small option and claim deals, its three earlier projects having been lost.

Written from the 24 story beats below (2008 to 7 Aug 2017), which come from the company's own announcements and filings.

Beat by beat

The events that changed the company's story, in plain English, each written against everything known about the company at the time. The dot shows whether it was good, bad or neutral for shareholders.

shares on issue market cap (log scale)

201725.0m shares · US$1.4m market cap

7 Aug
DEL TORO SILVER CORP. deregistered its securities, ending its obligation to file reports with the SEC.
listing compliance notice
25.0m shUS$1.4m
7 Mar
Del Toro Silver agreed to buy four mining claims in Storey County, Nevada from Comstock Resources Development LLC for 1,000,000 shares plus a 5% smelter royalty and 25% of any future resale proceeds - its latest small mineral-claim deal after losing all three of its earlier projects.
material agreement
25.0m shUS$655k

201625.0m shares · US$972k market cap

11 Oct
Del Toro Silver took an option (for a nominal $100 deposit) on the Mt. Vernon Mine claims in Sierra County, California from Lazarus Mining LLC - which the filing discloses is wholly owned and controlled by Patrick Fagen, the company's own president, CEO, CFO, secretary, treasurer and director, who had lent the company $55,000 two weeks earlier. The company's top executive was now on both sides of its financing and its asset deals.
material agreement
25.0m shUS$972k
23 Sept
Del Toro Silver settled both of its outstanding Asher Enterprises toxic convertible notes for a lump-sum $50,000 cash payment with mutual releases, finally ending the years-long death-spiral financing relationship that had been diluting shareholders roughly every month since late 2013.
material agreement
25.0m shUS$250k
20 Sept
Del Toro Silver renewed the Bowerman Holdings (California) deal once more, extending the closing to March 2017 - nearly five years after the original 2011 signing - this time paying for the extension with 1,000,000 shares issued to Bowerman's parent, Trinity Alps Resources.
capital raising announcement
25.0m shUS$250k

201425.0m shares · US$125k market cap

28 Oct
Del Toro Silver borrowed US$7,000 from Patrick Fagen, a director and officer, under an 8% convertible loan due in one year. Fagen could convert it into shares at US$0.007 per share.
capital raising announcement
25.0m shUS$125k
4 Sept
Del Toro Silver extended the Bowerman Holdings (California) claims deal yet again, to November 2014 with further extension options available - three years after the original signing with still no closing.
material agreement
23.3m shUS$233k

201321.8m shares · US$653k market cap

31 Dec
Del Toro Silver took on a fifth Asher Enterprises toxic note, $31,500 on the same 8%/death-spiral terms as the prior four.
capital raising announcement
21.8m shUS$653k
10 Dec
Del Toro Silver extended the Bowerman Holdings (California) claims deal again, agreeing to three more 90-day extension options - the deal still hadn't closed more than two years after it was signed.
material agreement
21.8m shUS$762k
31 Oct
Del Toro Silver took on another Asher Enterprises convertible note, $51,500 at 8% interest, maturing July 2014. It converts at 50% of the average of the three lowest trading prices in the prior 10 trading days.
capital raising announcement
21.8m shUS$1.0m
16 Sept
Del Toro Silver gave up its founding project entirely, terminating its option on the Dos Naciones silver property in Sonora, Mexico and transferring its 50% interest back to Alta Vista Ventures (formerly Yale Resources) - leaving the company named after silver with no silver project at all.
material agreement termination
21.8m shUS$1.0m
12 June
Del Toro Silver terminated its Natchez Pass, Nevada option and was released from all obligations. In return it received a 5% net smelter royalty and a 5% share of any sale price (minimum $300,000), but must issue 2,000,000 shares and Natchez Pass keeps all money already paid.
material agreement termination
19.8m shUS$573k
31 May
Del Toro Silver extended the Bowerman Holdings (California) claims closing deadline for a fifth time, to November 2013 - a year and a half past the original February 2012 schedule.
material agreement
18.0m shUS$523k
8 Apr
Del Toro Silver took on a third Asher Enterprises toxic note, $32,500 at 8% interest, convertible at 50% of the average of the lowest three trading prices over the prior 10 days - a death-spiral formula that gets more dilutive the further the stock falls.
capital raising announcement
17.5m shUS$1.4m
1 Mar
Del Toro Silver took on a second Asher Enterprises toxic convertible note, $37,500 at 8% interest, this time convertible at just 50% of market price - even steeper terms than the first Asher note four months earlier.
capital raising announcement
17.5m shUS$1.4m
16 Jan
Del Toro Silver paid Natchez Pass LLC $7,000 per extension for two more 60-day due-diligence periods on the Nevada option - now paying cash just to keep the unclosed deal alive.
material agreement
17.5m shUS$1.4m

201217.5m shares · US$1.4m market cap

14 Nov
Del Toro Silver extended the closing date on its Bowerman Holdings California claims to May 31, 2013, after three earlier 90-day extensions. It also extended its contractor's due-diligence work on the Natchez Pass Nevada option to May 31, 2013 because weather and road conditions had delayed it.
farm in farm out agreement
17.5m shUS$1.4m
25 Oct
Del Toro Silver took on its first outside toxic convertible note, an 8% $51,500 note from Asher Enterprises convertible at just 58% of market price after 180 days - a far more dangerous financing structure than the officer loans, since falling conversions increase share count and can push the price down further.
material agreement
16.0m shUS$1.9m
6 Sept
Del Toro Silver took on a third mineral project, an option with Natchez Pass LLC to earn up to 67.5% of a leasehold in Pershing County, Nevada, for $4.005 million in cash payments plus 5 million shares over five years - on top of its existing Mexico and California claims.
material agreement
16.0m shUS$1.9m
22 Feb
Del Toro Silver dismissed its second auditor in five months, Saturna Group, which had likewise flagged substantial doubt about the company's ability to continue as a going concern.
auditor change
15.8m shUS$1.6m

201115.5m shares · US$618k market cap

21 Nov
Del Toro Silver agreed to buy up to 75% of the KM and Raddlefinger mining claims in Siskiyou County, California from Bowerman Holdings for $6.525 million - a $4.5 million secured promissory note plus 40 million new shares - a huge commitment for a company that had been financing itself with $50,000-$200,000 loans from its own officers.
material agreement
15.5m shUS$618k
14 Sept
Del Toro Silver dismissed its auditor MacKay LLP; MacKay's prior reports had flagged substantial doubt about the company's ability to continue as a going concern, though there was no disagreement over accounting matters.
auditor change
13.0m shUS$520k

2009

15 July
Candev acquired a 50% interest (and an option on a further 30%) in the Dos Naciones silver project in Sonora, Mexico from Yale Resources for CAD$35,000, with future share issuances and CDN$800,000 of exploration spending required to earn the rest - the deal that gave rise to its later name, Del Toro Silver Corp, and ended its status as a shell company.
asset acquisition disposition

2008

4 Dec
Candev terminated its option to acquire the King Claims property in British Columbia by mutual agreement with the claims' owner, walking away from its only project and saying it was now looking for other business opportunities.
asset acquisition disposition