Dakota Gold Corp. (Form: S-1/A, Received: 05/06/2022 06:13:52)

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As filed with the U.S. Securities and Exchange Commission on May 6, 2022

Registration No. 333-263883

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Amendment No. 1
to

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

DAKOTA GOLD CORP.

(Exact name of registrant as specified in its charter)

	Nevada			1000			85-3475290
	(State or other jurisdiction of incorporation or organization)			(Primary Standard Industrial Classification Code Number)			(I.R.S. Employer Identification No.)

106 Glendale Drive, Suite A,
Lead, South Dakota, 57754
Telephone: (605) 906-8363

(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive offices)

Jeff N. Faillers, P.C. 241 Ridge Street Ste 210
Reno, NV 89501
Telephone: (775) 786-9494

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Richard Raymer
Dorsey & Whitney LLP
161 Bay St. #4310
Toronto, ON M5J 2S1, Canada
(416) 367-7370

Michael J. Hong
Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West
New York, NY 10001-8602
(212) 735-3000

Approximate date of commencement of proposed sale of the securities to the public: From time to time after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine

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The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated May 6, 2022.

DAKOTA GOLD CORP.

Up to 7,453,379 shares of common stock

This prospectus relates to the issuance by Dakota Gold Corp. (the “Company”) of up to 7,453,379 shares of common stock, par value $0.001 per share, that are issuable upon the exercise of the Private Placement Warrants (as defined under “About this Prospectus”).

The Company would receive approximately $15.5 million from the exercise in full of all of the Private Placement Warrants. To the extent the Private Placement Warrants are not exercised and expire, the amount of proceeds the Company would otherwise receive will decrease. Further, following the exercise of the Private Placement Warrants, the Company will not receive proceeds from any subsequent sale of the shares of common stock underlying the Private Placement Warrants. The registration of the shares of common stock covered by this prospectus does not mean that the Company will issue, offer or sell, as applicable, any of such shares.

The Company’s common stock is traded on the NYSE American stock exchange under the symbol “DC”.

The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012. As such, the Company has elected to comply with certain reduced public company reporting requirements for this prospectus and may elect to do so in future filings.

An investment in the Company’s common stock is subject to certain risks and should be made only by persons or entities able to bear the risk of and to withstand the total loss of their investment. Prospective investors should carefully consider and review the “Risk Factors” beginning on page 9.

Neither the Securities and Exchange Commission nor any other regulatory commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is , 2022.

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	About this Prospectus					1
	Cautionary Note Regarding Forward-Looking Statements					2
	Prospectus Summary					3
	Risk Factors					9
	Use of Proceeds					14
	Plan of Distribution					15
	Business					16
	Unaudited Pro Forma Condensed Consolidated Combined Financial Information					17
	Information About Dakota Gold Corp.					28
	Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Gold Corp.					29
	Information About Dakota Territory Resource Corp.					35
	Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Territory Resource Corp.					55
	Management					61
	Executive Compensation					64
	Certain Relationships and Related Party Transactions					65
	Security Ownership of Certain Beneficial Owners and Management					67
	Description of Capital Stock					68
	Legal Matters					69
	Experts					69
	Where You Can Find More Information					71
	Index to Financial Statements of Dakota Gold Corp.					F-1
	Index to Financial Statements of Dakota Territory Resource Corp.					F-40

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ABOUT THIS PROSPECTUS

The Private Placement Warrants

In 2020 and early 2021, pursuant to private placements in compliance with Rule 506(c) of the Securities Act of 1933, as amended (the “Securities Act”), the Company issued warrants (the “Private Placement Warrants”) to acquire an aggregate of up to 7,453,379 shares of its common stock. Each Private Placement Warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026.

This registration statement relates to the offer and sale of an aggregate of 7,453,379 shares of common stock of the Company from time to time upon exercise of the Private Placement Warrants.

The Transactions

On September 10, 2021, the Company and Dakota Territory Resource Corp. (“Dakota Territory”) entered into an Amended and Restated Agreement and Plan of Merger (as amended from time to time, the “merger agreement”). On March 31, 2022, pursuant to the merger agreement, the Company acquired Dakota Territory, which became a wholly-owned subsidiary of the Company. Each Dakota Territory stockholder (other than the Company) received one share of Company common stock for each share of Dakota Territory common stock held at the time of closing. As a result, immediately following the closing, the outstanding common stock of the combined company was owned 51% by the Company’s pre-transaction stockholders and 49% by Dakota Territory’s pre-transaction stockholders. Unless the context requires otherwise, references herein to the “transactions” mean the transactions contemplated by the merger agreement, taken as a whole.

Prior to the completion of the transactions, the Company, which previously had been named “JR Resources Corp.,” changed its name to “Dakota Gold Corp.” In connection with the transactions, the Company’s common stock was listed on the NYSE American stock exchange (the “NYSE American”) and now trades under the symbol “DC”.

Reverse Stock Split

On March 8, 2022, prior to the consummation of the transactions, the Company completed a reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 basis. In this prospectus, unless expressly indicated otherwise, information with respect to the Company’s shares is presented after giving effect to the reverse stock split.

Additional Information

For additional information, see “Where You Can Find More Information” beginning on page 71.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains or may contain forward-looking statements. Forward-looking statements may be identified by the use of forward-looking terms such as “may,” “will,” “can,” “expects,” “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects,” “assumes,” “guides,” “targets,” “forecasts,” “is confident that” and “seeks” or the negative of such terms or other variations on such terms or comparable terminology. Such forward-looking statements include, but are not limited to, statements about the anticipated benefits of the transactions between Dakota Territory and the Company, including the Company’s future financial and operating results, plans, objectives, expectations and intentions and other statements that are not historical facts.

These forward-looking statements are based upon the current beliefs and expectations of management and are subject to significant risks and uncertainties that could cause actual outcomes and results to differ materially. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, without limitation, the risks and uncertainties set forth under “Risk Factors” beginning on page 9, as well as:

•

those identified and disclosed in public filings with the SEC made by Dakota Territory and the Company;

•

the outcome of any legal proceedings that may be instituted against the Company and/or others relating to the merger agreement or the transactions;

•

risks that any stockholder litigation in connection with the transactions may result in significant costs of defense, indemnification and liability;

•

the ability to integrate Dakota Territory and the Company businesses successfully and to avoid problems which may result in the combined company not operating as effectively and efficiently as expected;

•

risks that expected synergies, operational efficiencies and cost savings from the transactions may not be fully realized or realized within the expected time frame;

•

the effects of future regulatory or legislative actions on the mining industry;

•

events that are outside of the control of the Company, such as political unrest, terrorist attacks, malicious human attacks, natural disasters, pandemics and other similar events; and

•

other economic, business, regulatory and/or competitive factors affecting the Company’s and business generally.

These factors and the other risk factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of forward-looking statements. Other unknown or unpredictable factors also could harm the Company’s results.

Consequently, the Company’s actual results could be materially different from the results described or anticipated by forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections and may be better or worse than anticipated. The areas of risk and uncertainty described above should also be considered in connection with any written or oral forward-looking statements that may be made after the date of this prospectus by the Company or anyone acting for the Company. Except for its ongoing obligations to disclose material information under the U.S. federal securities laws, the Company does not undertake any obligation to release publicly any revisions to any forward-looking statements, to report events or circumstances after the date of this prospectus or to report the occurrence of unanticipated events.

Given these uncertainties, you are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements represent estimates and assumptions only as of the date that they were made. The foregoing cautionary statements apply to all forward-looking statements contained in this document.

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PROSPECTUS SUMMARY

This summary highlights selected information contained elsewhere in this prospectus and may not contain all the information that may be important to you. Accordingly, you are encouraged to read this prospectus carefully and in its entirety, including its exhibits and the documents incorporated by reference into this prospectus. The page references have been included in this summary to direct you to a more complete description of the topics presented below. See also “Where You Can Find More Information” beginning on page 71.

References to “Dakota Territory” are references to Dakota Territory Resource Corp. References to the “Company” are references to Dakota Gold Corp. References to the “combined company” are references to the Company following the completion of the transactions. Unless the context requires otherwise, references herein to the “transactions” mean the transactions contemplated by the merger agreement, taken as a whole.

Overview

On September 10, 2021, the Company and Dakota Territory entered into an Amended and Restated Agreement and Plan of Merger (as amended from time to time, the “merger agreement”). On March 31, 2022, pursuant to the merger agreement, the Company acquired Dakota Territory, which became a wholly-owned subsidiary of the Company. Each Dakota Territory stockholder (other than the Company) received one share of Company common stock for each share of Dakota Territory common stock held at the time of closing. As a result, immediately following the closing, the outstanding common stock of the combined company was owned 51% by the Company’s pre-transaction stockholders and 49% by Dakota Territory’s
pre-transaction stockholders.

In addition, at the closing of the transactions, (i) each outstanding option to purchase Dakota Territory common stock, whether vested or unvested, was assumed and converted into an option with respect to a number of shares of Company common stock in the manner set forth in the merger agreement, (ii) each outstanding award of restricted stock units with respect to shares of Dakota Territory common stock were assumed and converted into the right to receive an award of restricted stock units representing a right to receive a number of shares of Company common stock in the manner set forth in the merger agreement, and (iii) the Company, which had previously been named “JR Resources Corp.,” changed its name to “Dakota Gold Corp.”

The Company is a Nevada corporation that was formed in British Columbia, Canada in 2017 and continued to Nevada in 2020.

The Company’s common stock is traded on the NYSE American under the symbol “DC”.

The Company’s principal executive office is located at 106 Glendale Drive, Suite A, Lead, South Dakota 57754, its telephone number is (605) 906-8363 and its website is located at www.dakotagoldcorp.com.

For more information regarding the business of the Company, see “Information About Dakota Gold Corp” beginning on page 28 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Gold Corp.” beginning on page 29, in addition to “Information About Dakota Territory Resource Corp.” beginning on page 35 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Territory Resource Corp.” beginning on page 55.

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THE OFFERING

The registration statement of which this prospectus forms a part registers the issuance of up to 7,453,379 shares of the Company’s common stock issuable from time to time upon exercise of the Private Placement Warrants. Before investing in the Company’s securities, you should carefully read and consider the information set forth in “Risk Factors” beginning on page 9.

Issuer

Dakota Gold Corp.

Shares of Common Stock Outstanding Prior to Exercise of any Private Placement
Warrants

71,157,144 shares

Shares of Common Stock to be Issued upon Exercise of all Private Placement Warrants

7,453,379 shares

Exercise Price of the Private Placement Warrants

$2.08 per share

Exercise Period

Commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026.

Use of Proceeds

The Company intends to use the net proceeds from exercises of the Private Placement Warrants for general corporate purposes, which may include acquisitions or other strategic investments, repayment of outstanding indebtedness, capital expenditures or working capital purposes. See “Use of Proceeds” beginning on page 14.

Plan of Distribution

The common stock registered hereunder may be issued from time to time upon exercise of the Private Placement Warrants. See “Plan of Distribution” beginning on page 15.

NYSE American Listing

The Company’s common stock is traded on the NYSE American under the symbol “DC”.

The number of shares of common stock shown to be outstanding prior to exercise of any Private Placement Warrants is based on 71,157,144 shares of the Company’s common stock outstanding as of May 4, 2022. Such number (a) takes into account (i) the Company’s reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 basis, which the Company completed on March 8, 2022, and (ii) the shares of common stock issued in the transactions., which closed on March 31, 2022, but (b) does not include shares of common stock underlying outstanding warrants or options or shares of common stock reserved for issuance under equity incentive plans.

Implications of Being an Emerging Growth Company

The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). For as long as the Company continues to be an emerging growth company, the Company expects to take advantage of certain exemptions, including (a) being required to present only two years of audited financial statements and related financial disclosure in this prospectus, (b) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, (c) being subject to extended transition periods for complying with new or revised accounting standards, (d) being subject to reduced disclosure obligations regarding executive compensation in periodic reports and proxy statements, and (e) being exempt from the requirements to hold a nonbinding advisory vote on executive compensation or obtain stockholder approval of golden parachute payments. The Company will remain an emerging growth company for up to five years, although the Company will lose that status earlier upon the earliest of (i) the last day of the first fiscal year in which the Company’s annual gross revenues

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exceed $1.07 billion, (ii) the date that the Company become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of Company common stock that is held by non-affiliates exceeds $700 million as of the last business day of the Company’s most recently completed second fiscal quarter, and (iii) the date on which the Company has issued more than $1 billion in non-convertible debt during the preceding three-year period.

Additionally, the Company is a “smaller reporting company,” as defined in Regulation S-K promulgated under the Securities Act of 1933, as amended (the “Securities Act”). The Company will remain a smaller reporting company while either (a) the market value of the Company’s stock held by non-affiliates was less than $250 million as of the last business day of the Company’s most recently completed second fiscal quarter, or (b) the Company’s annual revenue was less than $100 million during the Company’s most recently completed fiscal year and the market value of the Company’s stock held by non-affiliates was less than $700 million as of the last business day of the Company’s most recently completed second fiscal quarter. If the Company is still considered a smaller reporting company at such time as the Company ceases to be an emerging growth company, the Company will be subject to increased disclosure requirements, but these disclosure requirements will still be less than they would be if the Company were not considered either an emerging growth company or a smaller reporting company. Similar to emerging growth companies, smaller reporting companies (i) are exempt from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002; and (ii) have certain other reduced disclosure obligations in their filings with the Securities and Exchange Commission (the “SEC”), including the ability to present only two years of audited financial statements and related financial disclosure in their annual reports and to provide simplified executive compensation disclosures in their periodic reports and proxy statements.

Market Price and Dividend Information

The Company’s common stock is traded on the NYSE American under the symbol “DC”. As of May 4, 2022, the latest practicable date prior to the date of this prospectus, the last sale price of the Company’s common stock reported on the NYSE American was $4.05. As of May 4, 2022, the latest practicable date prior to the date of this prospectus, there were approximately 930 holders of record of the Company’s common stock.

The Company has not historically paid cash dividends on its common stock and does not expect to pay cash dividends on its common stock. Rather, the Company intends to retain its capital resources for reinvestment in its business.

Summary Historical Consolidated Financial Information of the Company

Below is summary historical consolidated financial information regarding the Company. The Company derived (i) the financial information as of and for the fiscal years ended March 31, 2021 and 2020 from its historical audited consolidated financial statements and related notes for the fiscal years then ended and (ii) the financial information as of and for the nine month period ended December 31, 2021 and 2020 from its unaudited condensed consolidated financial statements and related notes which include, in the opinion of the Company’s management, all normal and recurring adjustments that are considered necessary for the fair statement of the results for such interim periods and dates. The information set forth below is only a summary that you should read together with the historical audited consolidated financial statements of the Company for the fiscal years ended March 31, 2021 and 2020 and the nine month period ended December 31, 2021 and 2020 and the related notes, as well as the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company” contained in this prospectus. The historical results presented are not necessarily indicative of results to be expected in any future period. The information set forth below with respect to the Company’s shares is presented (a) after giving effect to the Company’s 1 for 35,641,667 / 49,398,602 reverse stock split, which the Company completed on March 8, 2022, but (b) without giving effect to the transactions, which closed on March 31, 2022.

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	Year Ended March 31,
	2021			2020
Statement of operations data:
Loss from operations		$	(2,092,118)		$	(169,673)
Net income (loss)		$	25,520,417		$	(193,283)
Net earnings (loss) per share – Basic and diluted		$	1.12		$	(0.05)
Weighted average shares outstanding – Basic and diluted			23,165,060			4,013,877
Balance sheet data:
Cash and cash equivalents		$	11,444,668		$	141,768
Total assets		$	70,632,103		$	849,602
Total current liabilities		$	1,756,390		$	87,964
Total liabilities		$	11,628,173		$	87,964
Total stockholder’s equity		$	59,003,930		$	761,638

	Nine Months ended
	December 31, 2021			December 31, 2020
Statement of operations data:
Loss from operations		$	(23,638,909)		$	(989,264)
Net income (loss)		$	(23,486,041)		$	26,333,419
Net earnings (loss) per share – Basic and diluted		$	(0.39)		$	1.24
Weighted average shares outstanding – Basic and diluted			35,561,255			21,315,035

	December 31, 2021			March 31, 2021
Balance sheet data:
Cash and cash equivalents		$	46,790,482		$	11,444,668
Total assets		$	121,391,879		$	70,632,103
Total current liabilities		$	1,185,755		$	1,756,390
Total liabilities		$	10,202,521		$	11,628,173
Total stockholder’s equity		$	111,189,358		$	59,003,930

Summary Historical Consolidated Financial Information of Dakota Territory

Below is summary historical consolidated financial information regarding Dakota Territory. Dakota Territory derived (i) the financial information as of and for the fiscal years ended March 31, 2021 and 2020 from its historical audited consolidated financial statements and related notes for the fiscal years then ended and (ii) the financial information as of and for the nine month period ended December 31, 2021 and 2020 from its unaudited consolidated financial statements and related notes which include, in the opinion of Dakota Territory’s management, all normal and recurring adjustments that are considered necessary for the fair statement of the results for such interim periods and dates. The information set forth below is only a summary that you should read together with the historical audited consolidated financial statements of Dakota Territory for the fiscal years ended March 31, 2021 and 2020 and the nine month period ended December 31, 2021 and 2020 and the related notes, as well as the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in Dakota Territory’s Annual Report on Form 10-K for the year ended March 31, 2021 and Quarterly Report on Form 10-Q for the three and nine months ended December 31, 2021 that Dakota Territory previously filed with the SEC. For more information, see the section entitled “Where You Can Find More Information” beginning on page 71. The historical results presented are not necessarily indicative of results to be expected in any future period. The information set forth below with respect to Dakota Territory’s shares is presented without giving effect to the transactions, which closed on March 31, 2022.

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	Year Ended March 31,
	2021			2020
Statement of operations data:
Loss from operations		$	(1,834,524)		$	(1,101,472)
Net loss		$	(3,165,041)		$	(1,114,273)
Net loss per share – Basic and diluted		$	(0.12)		$	(0.07)
Weighted average shares outstanding – Basic and diluted			25,904,749			16,054,675
Balance sheet data:
Cash and cash equivalents		$	10,392,940		$	146,425
Total assets		$	16,676,364		$	370,178
Total current liabilities		$	1,071,792		$	2,948,374
Total liabilities		$	1,545,117		$	2,948,374
Accumulated deficit		$	(8,542,784)		$	(5,377,743)
Total stockholder’s equity (deficit)		$	15,131,247		$	(2,578,196)

	Nine Months Ended
	December 31, 2021			December 31, 2020
Statement of operations data:
Loss from operations		$	(22,545,178)		$	(1,100,526)
Net loss		$	(22,653,706)		$	(2,415,630)
Net loss per share – Basic and diluted		$	(0.35)		$	(0.11)
Weighted average shares outstanding – Basic and diluted			65,079,372			21,174,813

	December 31, 2021			March 31, 2021
Balance sheet data:
Cash and cash equivalents		$	46,637,914		$	10,392,940
Total assets		$	68,450,036		$	16,676,364
Total current liabilities		$	619,598		$	1,071,792
Total liabilities		$	619,598		$	1,545,117
Accumulated deficit		$	(31,196,490)		$	(8,542,784)
Total stockholder’s equity (deficit)		$	67,830,438		$	15,131,247

Summary Unaudited Pro Forma Condensed Consolidated Combined Financial Information

These unaudited pro forma financial statements have been prepared in connection with the transaction between the Company and Dakota Territory, which closed on March 31, 2022 (the “Transaction”).

These unaudited pro forma financial statements have been prepared using information derived from, and should be read in conjunction with, the consolidated financial statements of the Company for the year ended March 31, 2021, the condensed consolidated financial statements of the Company for the nine month period ended December 31, 2021, the consolidated financial statements of Dakota Territory for the year ended March 31, 2021 and the condensed consolidated financial statements of Dakota Territory for the nine month period ended December 31, 2021. The historical annual financial statements of the Company and Dakota Territory were prepared in accordance with U.S. GAAP.

The unaudited pro forma statement of operations for the year ended March 31, 2021 has been prepared as if the Transaction had occurred on April 1, 2020.

The unaudited pro forma statement of operations for the nine month period ended December 31, 2021 have been prepared as if the Transaction had occurred on March 31, 2021.

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realized and integration costs that may be incurred on completion of the Transaction have been excluded from the unaudited pro forma financial information. Further, the pro forma financial information is not necessarily indicative of the results of operations that may be obtained in the future. Future results may vary significantly from the results reflected because of various factors, including those discussed in the section entitled “Risk Factors” beginning on page 9. The following selected pro forma financial information should be read in conjunction with the section entitled “Unaudited Pro Forma Condensed Consolidated Combined Financial Information” and related notes beginning on page 17, the audited historical financial statements of Dakota Territory and the notes thereto beginning on page F-40 and the audited historical financial statements of the Company and the notes thereto beginning on page F-1.

The information set forth below with respect to the Company’s shares is presented after giving effect to the 1 for 35,641,667 / 49,398,602 reverse stock split, which the Company completed on March 8, 2022.

Pro Forma Income Statement

(Unaudited, expressed in United States dollars, except for per share amounts)

	For the Year Ended March 31, 2021			For the Nine Months Ended December 31, 2021
Consulting		$	820,354		$	507,404
Exploration costs			788,719			6,117,247
Office, travel and general			573,186			15,378,269
Professional fees			1,049,503			1,635,989
General and administrative expenses			—			—
Loss from operations			(3,231,762)			(23,638,909)
Other income (expense)
Foreign exchange income			79,001			(49,543)
Interest income			34,443			16,094
Interest expense			—			(70,854)
Loss on settlement of debt			—			(124,521)
			113,444			(228,824)
Net income (loss) before income tax			(3,118,318)			(23,867,733)
Deferred tax benefit			413,424			381,692
Net income (loss)		$	(2,704,894)		$	(23,486,041)
Basic and diluted loss per share		$	(0.06)		$	(0.33)
Weighted average shares outstanding
Basic and diluted			45,294,662			70,747,792

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RISK FACTORS

An investment in the Company’s common stock involves a high degree of risk. In addition to the risk and uncertainties described under “Cautionary Note Regarding Forward-Looking Statements” beginning on page 2, you should consider carefully the risks and uncertainties described below, together with all of the other information contained in this prospectus, including the consolidated financial statements and related notes, before deciding to invest in the Company’s common stock. If any of the following events occur, the Company’s business, financial condition and operating results may be materially adversely affected. In that event, the trading price of the Company’s common stock could decline, and you could lose all or part of your investment. The risks and uncertainties described below are not the only ones faced by the Company. Additional risks and uncertainties that the Company is unaware of, or that the Company currently believes are not material, may also become important factors that adversely affect the Company’s business or results of operations.

Risks Related to the Company’s Business

The Company’s results of operations and financial condition following the transactions may materially differ from the pro forma information presented in this prospectus.

The unaudited pro forma condensed consolidated combined financial information in this prospectus is presented for illustrative purposes only and is not necessarily indicative of what the Company’s actual results of operations and financial condition would have been had the transactions been completed on the dates indicated. The unaudited pro forma condensed consolidated combined financial information reflects adjustments, which are based upon preliminary estimates, to record Dakota Territory identifiable assets to be acquired and liabilities to be assumed at fair value, and the resulting goodwill to be recognized. The purchase price allocation reflected is preliminary, and final allocation of the purchase price will be based upon the actual purchase price and the fair value of the assets acquired and liabilities assumed in the transactions. Accordingly, the final acquisition accounting adjustments may differ materially from the pro forma adjustments reflected in this document. The unaudited pro forma condensed combined financial information is also based on a number of other estimates and assumptions, including the related fees and expenses.

Dakota Territory has merged with and into a wholly owned subsidiary of the Company. Accordingly, the risks specific to the businesses of Dakota Territory and the Company will affect the combined business of the Company following completion of the transactions.

You should read and consider the risk factors described in Part I, Item 1A of Dakota Territory’s Annual Report on Form 10-K for the fiscal year ended March 31, 2021, as updated by subsequent Quarterly Reports on Form 10-Q, all of which are filed by Dakota Territory with the SEC. See “Where You Can Find More Information” beginning on page 71.

The combined company’s operating results may fluctuate significantly as a result of a variety of factors, many of which are outside of its control.

The following factors, among others, may negatively affect the combined company’s operating results:

•

the progress, potential and uncertainties of the exploration program at the properties located in the Homestake District of South Dakota (the “Project”);

•

the Company will be party to several material property option agreements. The Company may decide not to exercise its rights pursuant to such agreements or its rights as an option holder may be terminated by the optionor in certain circumstances;

•

the lack of defined resources that are Item 1300 of Reg. S-K Compliant Reserves, and may never be;

•

Dakota Territory’s history of losses and need for additional financing;

•

the combined company’s limited operating history;

•

the combined company’s properties all being in the exploration stage;

•

the combined company’s lack of history in producing metals from the Company’s properties;

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•

the combined company’s need for additional financing to develop a producing mine, if warranted;

•

the combined company’s exploration activities not being commercially successful;

•

ownership of surface rights at the Project;

•

increased costs affecting the combined company’s financial condition;

•

a shortage of equipment and supplies adversely affecting the combined company’s ability to operate;

•

mining and mineral exploration being inherently dangerous;

•

mineralization estimates;

•

changes in mineralization estimates affecting the economic viability of the combined company’s properties;

•

uninsured risks;

•

mineral operations being subject to market forces beyond the combined company’s control;

•

fluctuations in commodity prices;

•

uncertainty surrounding permitting, licenses and approval processes;

•

uncertainty surrounding the governmental and environmental regulations;

•

future legislation regarding the mining industry and climate change;

•

potential environmental lawsuits;

•

the combined company’s land reclamation requirements;

•

gold mining presenting potential health risks;

•

title to the combined company’s properties

•

competition in the gold mining industries;

•

economic conditions, including as a result of the ongoing COVID-19 pandemic;

•

the combined company’s ability to manage growth;

•

the potential difficulty of attracting and retaining qualified personnel;

•

the combined company’s dependence on key personnel;

•

Dakota Territory’s and the Company’s SEC filing history or lack thereof, as the case may be; and

•

the combined company’s securities.

The Company has a history of operating losses.

The Company has incurred operating losses in each year since its inception, and may incur additional losses in the future. For the nine months ended December 31, 2021, the Company had operating losses of $23,638,909. As of December 31, 2021, the Company held cash and cash equivalents of approximately $46,790,482.

The Company expects to continue to incur operating expenses in the foreseeable future . The extent of the Company’s future operating losses or profits is highly uncertain, and it may not maintain profitability. If the Company is unable to achieve and then maintain profitability, the market value of the Company’s common stock will likely decline.

Dakota Territory’s independent auditor has expressed substantial doubt about its ability to continue as a going concern.

Dakota Territory’s independent auditor’s report on its financial statements included an explanatory paragraph that indicates that the financial statements were prepared assuming that Dakota Territory would continue as a going concern. As discussed in Note 1 to the financial statements for the year ended March 31,

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2021, Dakota Territory has an accumulated deficit from inception through March 31, 2021 of approximately $8,543,000 and has yet to achieve profitable operations, and projects further losses in the development of its business. This condition raises substantial doubt about Dakota Territory’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon generating profitable operations in the future and/or obtaining the necessary financing to meet Dakota Territory’s obligations and repay its liabilities arising from normal business operations when they become due. There can be no assurance that Dakota Territory will be successful in its plans described above or in attracting equity or alternative financing on acceptable terms, or if at all. Dakota Territory’s financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should Dakota Territory be unable to continue as a going concern. The Company is required to consider whether, and may find, that there is substantial doubt about the Company’s ability to continue, as a going concern.

If the Company fails to manage any expansion or acquisition, its business could be impaired.

The Company may in the future acquire one or more mining properties or interests that expand its operations. The Company may not be able to effectively integrate those mining properties or interests into its business and any such acquisition could bring additional risks, exposures and challenges to the Company. In addition, acquisitions may dilute the Company’s earnings per share, disrupt its ongoing business, distract its management and employees, increase its expenses, subject it to liabilities and increase its risk of litigation, all of which could harm its business. If the Company uses cash to acquire mining properties or interests, such use may divert resources otherwise available for other purposes. If the Company uses its common stock to acquire mining properties or interests, its stockholders may experience substantial dilution. If the Company fails to manage any expansions or acquisition, its business could be impaired.

The Company may not be able to attract and retain additional key management or other personnel, or it may lose existing key management, which may limit its ability to compete in the mining industry.

The Company will depend on a number of key management personnel. The loss of the services of one or more key employees could limit the Company’s ability to compete in the mining industry. Its success will also depend on the Company’s ability to attract and retain additional highly qualified management and other personnel to meet its growth goals. The Company faces intense competition for qualified personnel, many of whom are often subject to competing employment offers, and it is unclear whether the Company will be able to attract and retain such personnel.

Future changes in financial accounting standards or practices or existing taxation rules or practices may cause adverse or unexpected revenue fluctuations and affect its reported results of operations.

A change in accounting standards or practices or a change in existing taxation rules or practices, both in the U.S. and abroad, can have a significant effect on the Company’s reported results and may even affect its reporting of transactions completed before the change is effective. New accounting pronouncements and taxation rules, both in the U.S. and abroad, and varying interpretations of accounting pronouncements and taxation practice have occurred and may occur in the future. Changes to existing rules or the questioning of current practices may adversely affect the Company’s reported financial results or the way it conducts its business.

As a privately held entity, the Company was not required to comply with the reporting requirements of the Exchange Act or the requirements of the Sarbanes-Oxley Act of 2002 prior to the closing of the transactions, which occurred on March 31, 2022. As a public company, Dakota Territory has been required to comply with such requirements. However, in regard to the Company, such new requirements may strain its resources, increase its costs and distract management, and it may be unable to comply with these requirements in a timely or cost-effective manner.

As a public company with listed equity securities, the Company must comply with laws, regulations and requirements, certain corporate governance provisions of the Sarbanes-Oxley Act of 2002, related regulations of the SEC, including compliance with the reporting requirements of the Exchange Act, and the requirements of NYSE American, with which the Company was not required to comply as a private company.

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Complying with these statutes, regulations and requirements will occupy a significant amount of time of the Company board and management and may significantly increase the Company’s costs and expenses compared to that of Dakota Territory. While combining the Company and Dakota Territory accounting and operations functions, the Company will need to:

•

institute a comprehensive compliance function;

•

design, establish, evaluate and maintain a system of internal controls over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the related rules and regulations of the SEC and the Public Company Accounting Oversight Board;

•

comply with rules promulgated by the NYSE American;

•

prepare and distribute periodic public reports in compliance with its obligations under the federal securities laws;

•

establish new internal policies, such as those relating to disclosure controls and procedures and insider trading;

•

involve and retain to a greater degree than Dakota Territory had to, outside counsel and accountants in the above activities; and

•

establish an investor relations function.

These factors could also make it more difficult for the Company to attract and retain qualified members of its board of directors and qualified executive officers. If the Company’s profitability is adversely affected because of these additional costs, it could have a negative effect on the trading price of the Company’s common stock.

Risks Related to the Ownership of the Company’s Common Stock

The market price of the Company’s common stock may be subject to significant fluctuations and volatility and you may be unable to sell your the Company’s common stock at a profit or may lose all or part of your investment.

The market price of the Company’s common stock could be subject to significant fluctuation . The results of operations of the Company and the market price of its common stock following the completion of the transactions may be affected by factors different from those currently affecting the independent results of operations of and the stock price of Dakota Territory. Some of the factors that may cause fluctuation in the stock price or trading volume of the Company’s common stock include:

•

general market and economic conditions and market trends, including in the mining industry and the financial markets generally;

•

the political, economic and social situation in the United States and in the world;

•

actual or expected variations in operating results;

•

variation in quarterly operating results;

•

inability to meet projections in revenue made by the Company;

•

speculation in the press or investment community;

•

the failure of research analysts to cover the Company’s common stock, adverse changes to research analyst recommendations, or the failure of the Company’s operating results to meet research analyst expectations;

•

announcements by the Company or its competitors of significant acquisitions, strategic partnership, joint ventures, capital commitments or other business developments;

•

adoption of new accounting standards affecting the industry in which the Company operates;

•

operations of competitors and the performance of competitors’ common stock;

•

litigation or governmental action involving or affecting the Company;

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•

changes in financial estimates and recommendations by securities analysts;

•

recruitment or departure of key personnel;

•

purchases or sales of blocks of the Company’s common stock;

•

operating and stock performance of the companies that investors may consider to be comparable;

•

domestic and international economic, legal and regulatory factors unrelated to the Company’s performance; and

•

the realization of any risks described under “Risk Factors” in this document.

There can be no assurance that the price of the Company’s common stock will not fluctuate or decline significantly. The stock market in recent years has experienced considerable price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of individual companies and that could adversely affect the price of the Company’s common stock, regardless of its operating performance.

Stock price volatility might be worse if the trading volume of shares of the Company’s common stock is low. Furthermore, stockholders may initiate securities class action lawsuits if the market price of the Company’s common stock declines significantly, which may cause the Company to incur substantial legal expenses and could divert the time and attention of the Company’s management and the Company board.

Future sales of the Company’s common stock in the public market could reduce its stock price, and any additional capital raised by the Company through the sale of equity or convertible securities may dilute your ownership in the Company.

The Company may issue additional shares of common stock or convertible securities in future public offerings. Immediately following the transactions, the Company had approximately 70,850,983 outstanding shares of common stock. Following the closing of the transactions, the Company intends to file a registration statement with the SEC on Form S-8 providing for the registration of shares of its common stock issued or reserved for issuance under the Company’s equity incentive plan. Subject to the satisfaction of vesting conditions, shares registered under the registration statement on Form S-8 will be available for resale immediately following the completion of the transactions in the public market without restriction. The Company cannot predict the size of future issuances of its common stock or securities convertible into common stock or the effect, if any, that future issuances and sales of shares of its common stock will have on the market price of its common stock. Sales of substantial amounts of the Company’s common stock (including shares issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing market prices of the Company’s common stock.

The Company does not intend to pay cash dividends on its common stock.

Applicable state law may impose requirements that may impede the Company’s ability to pay dividends on its common stock. Therefore, it is likely that any return on investment for the Company’s stockholders, at least in the near term, will occur only if the market price of its common stock appreciates.

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USE OF PROCEEDS

Each Private Placement Warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026.

Unless the Company informs you otherwise, the Company intends to use the net proceeds from exercises of the Private Placement Warrants for general corporate purposes, which may include acquisitions or other strategic investments, capital expenditures or working capital purposes. The Company’s management will have broad discretion over the use of proceeds from the exercise of the Private Placement Warrants.

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PLAN OF DISTRIBUTION

The Company is registering the shares of common stock issuable from time to time upon exercise of the Private Placement Warrants and will bear all fees and expenses incident to the registration of such shares. The Company would receive approximately $15.5 million from the exercise in full of all of the Private Placement Warrants. To the extent the Private Placement Warrants are not exercised and expire, the amount of proceeds the Company would otherwise receive will decrease. Further, following the exercise of the Private Placement Warrants, the Company will not receive proceeds from any subsequent sale of the shares of common stock underlying the Private Placement Warrants.

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BUSINESS

Overview

The Company is a Nevada corporation that was formed in British Columbia, Canada in 2017 and continued to Nevada in 2020.

The Company’s common stock is traded on the NYSE American under the symbol “DC”.

For more information regarding the business of the Company, see “Information Regarding Dakota Gold Corp” beginning on page 28 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Gold Corp.” beginning on page 29, in addition to “Information Regarding Dakota Territory Resource Corp.” beginning on page 35 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Dakota Territory Resource Corp.” beginning on page 55.

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED COMBINED
FINANCIAL INFORMATION

These unaudited pro forma financial statements have been prepared in connection with the transactions between the Company and Dakota Territory.

The consolidated statement of operations of the Company for the year ended March 31, 2021;

ii.

The consolidated statement of operations of Dakota Territory for the year ended March 31, 2021; and

iii.

The adjustments described in note 3 to the pro forma financial statements.

The unaudited pro forma statement of operations for the year ended March 31, 2021 have been prepared as if the Transaction had occurred on April 1, 2020.

These pro forma financial statements have been compiled from and include:

An unaudited pro forma statement of operations for the nine-month period ended December 31, 2021 combining:

The consolidated statement of operations of the Company for the nine-month period ended December 31, 2021;

The consolidated statement of operations of Dakota Territory for the nine-month period ended December 31, 2021; and

The adjustments described in note 3.

ii.

An unaudited pro forma balance sheet as at December 31, 2021 combining

The consolidated balance sheet of the Company as at December 31, 2021;

The consolidated balance sheet of Dakota Territory as at December 31, 2021; and

The adjustments described in note 3.

The unaudited pro forma statement of operations for the nine month period ended December 31, 2021 have been prepared as if the Transaction had occurred on April 1, 2021.

The unaudited pro forma financial statements are not intended to reflect the financial performance of the Company which would have resulted had the Transaction been effected on the date indicated. Actual amounts recorded upon completion of the Transaction will likely differ from those recorded in the unaudited pro forma financial statements and such differences could be material. Any potential synergies that may be realized and integration costs that may be incurred on completion of the Transaction have been excluded from the unaudited pro forma financial information. Further, the pro forma financial information is not necessarily indicative of the results of operations that may be obtained in the future.

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UNAUDITED PRO FORMA BALANCE SHEET AS AT MARCH 31, 2021

(Unaudited, expressed in United States dollars, except for per share amounts)

	Dakota Territory Resource Corp.			Dakota Gold Corp. (formerly "JR Resources Corp.")			Pro Forma Adjustments			Notes	Pro Forma
Current assets
Cash and cash equivalents		$	10,392,940		$	11,444,668		$	(10,392,940)	3(e)		$	11,444,668
Prepaid expenses and other current assets			75,608			384,897			(75,608)	3(e)			384,897
Total current assets			10,468,548			11,829,565			(10,468,548)				11,829,565
Non-current assets
Mineral properties, net			5,337,072			57,931,794			(5,337,072)	3(e)			57,931,794
Property and equipment, net			870,744			870,744			(870,744)	3(e)			870,744
Total assets		$	16,676,364		$	70,632,103		$	(16,676,364)			$	70,632,103
Current liabilities
Accounts payable and accrued liabilities		$	162,024		$	846,622		$	(162,024)	3(e)		$	846,622
Accounts payable – related party			3,000			3,000			(3,000)	3(e)			3,000
Current portion of notes payable – related party			906,768			906,768			(906,768)	3(e)			906,768
Total current liabilities			1,071,792			1,756,390			(1,071,792)				1,756,390
Non-current liabilities
Notes payable – related party, net of current portion and discount			473,325			473,325			(473,325)	3(e)			473,325
Deferred tax liability			—			9,398,458			—				9,398,458
Total liabilities			1,545,117			11,628,173			(1,545,117)				11,628,173
Stockholders’ equity
Share capital			56,197			35,136			(56,197)	3(e)			70,322
									35,186	3(g)
Additional paid in capital			23,617,834			12,105,720			(2,469,407)	3(e), 3(f)			33,254,147
Retained earnings (deficit)			(8,542,784)			25,679,461			8,542,784	3(e)			25,679,461
Equity attributable to stockholders			15,131,247			37,820,317			6,052,366				59,003,930
Non-controlling interest			—			21,183,613			(21,183,613)	3(f)			—
Total stockholders’ equity		$	15,131,247		$	59,003,930		$	(15,131,247)			$	59,003,930
Total stockholders’ equity and liabilities		$	16,676,364		$	70,632,103		$	(16,676,364)			$	70,632,103

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UNAUDITED PRO FORMA STATEMENT OF OPERATIONS FOR
THE YEAR ENDED MARCH 31, 2021

(Unaudited, expressed in United States dollars, except for per share amounts)

	Dakota Territory Resource Corp.			Dakota Gold Corp. (formerly “JR Resources Corp.”)			Pro Forma Reclassification (Note 3(a))			Pro Forma Adjustments			Notes	Pro Forma
Consulting		$	—		$	670,920		$	329,941		$	(180,507)	3(b)		$	820,354
Exploration costs			673,545			271,853			—			(156,679)	3(b)			788,719
Office, travel and general			—			515,104			255,327			(197,245)	3(b)			573,186
Professional fees			—			634,241			575,711			(160,449)	3(b)			1,049,503
General and administrative expenses			1,160,979			—			(1,160,979)				3(b)			—
Loss from operations			(1,834,524)			(2,092,118)						694,880				(3,231,762)
Other income (expense)
Foreign exchange income			—			79,001						—				79,001
Interest income			7,204			32,443						(5,204)	3(b)			34,443
Interest expense			(1,337,721)			—						1,337,721	3(d)			—
Gain on derivatives			—			27,087,667						(27,087,667)	3(c)			—
			(1,330,517)			27,199,111										113,444
Net income (loss) before income tax		$	(3,165,041)		$	25,106,993									$	(3,118,318)
Deferred tax benefit						413,424										413,424
Net income (loss)		$	(3,165,041)		$	25,520,417									$	(2,704,894)
Basic and diluted earnings (loss) per share		$	(0.12)		$	1.12									$	(0.06)
Weighted average shares outstanding
Basic and diluted			25,904,749			23,165,060						(3,775,147)	3(g)			45,294,662

The accompanying notes are an integral part of these pro forma financial statements.

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the year ended March 31, 2021
(Unaudited, expressed in United States dollars, unless otherwise stated)

1. BASIS OF PRESENTATION AND DESCRIPTION OF THE TRANSACTION

These unaudited pro forma financial statements have been prepared in connection with the transaction between Dakota Gold Corp. (formerly “JR Resources Corp.”) (the “Company”) and Dakota Territory Resource Corp. (“Dakota Territory”), which closed on March 31, 2022 (the “Transaction”).

Under the terms of the Transaction between the Company and Dakota Territory, Dakota Territory stockholders received one share of Company common stock for each share of Dakota Territory common stock. The Company stockholders continued to hold shares of the Company. On March 8, 2022, prior to the closing of the Transaction, the Company completed a reverse share split such that the total number of Company shares was proportionally reduced to 35,641,667 Company shares.

In addition, at the closing of the Transaction, (i) each outstanding option to purchase Dakota Territory common stock, whether vested or unvested, was assumed and converted into an option with respect to a number of shares of Company common stock in the manner set forth in the Amended and Restated Agreement and Plan of Merger , dated as of September 10, 2021, by and among Dakota Territory, the Company and the other parties thereto (the “merger agreement”), (ii) each outstanding award of restricted stock units with respect to shares of Dakota Territory common stock were assumed and converted into the right to receive an award of restricted stock units representing a right to receive a number of shares of Company common stock in the manner set forth in the merger agreement, and (iii) the Company, which had previously been named “JR Resources Corp.,” changed its name to “Dakota Gold Corp.”

The transaction described above is accounted for as an equity transaction in which Company shares were issued to acquire the non-controlling interest held by Dakota Territory shareholders. The share issuance has been reflected as an adjustment to the basic and diluted weighted average shares outstanding in the pro forma income statement.

During the year ended March 31, 2021 the Company acquired control of Dakota Territory. As a result, the Company consolidated Dakota Territory’s results in its income statement from the date it acquired control of Dakota Territory.

These unaudited pro forma financial statements have been prepared using information derived from, and should be read in conjunction with, the consolidated financial statements of the Company for the year ended March 31, 2021 and the consolidated financial statements of Dakota Territory for the year ended March 31, 2021. The historical annual financial statements of the Company and Dakota Territory were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These pro forma financial statements have been compiled from and include:

a) An unaudited pro forma statement of operations for the year ended March 31, 2021 combining:

The consolidated statement of operations of the Company for the year ended March 31, 2021;

ii.

The consolidated statement of operations of Dakota Territory for the year ended March 31, 2021; and

iii.

The adjustments described in note 3.

b) An unaudited pro forma balance sheet as at March 31, 2021 combining:

The consolidated balance sheet of the Company as at March 31, 2021;

ii.

The consolidated balance sheet of Dakota Territory as at March 31, 2021; and

iii.

The adjustments described in note 3.

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the year ended March 31, 2021
(Unaudited, expressed in United States dollars, unless otherwise stated)

The unaudited pro forma statement of operations for the year ended March 31, 2021 have been prepared as if the Transaction had occurred on April 1, 2020.

2. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies used in preparing the unaudited pro forma financial statements are set out in the Company’s audited consolidated financial statements for the year ended March 31, 2021. In preparing the unaudited pro forma financial statements, a preliminary review was undertaken to identify any accounting policy differences between the accounting policies used by Dakota Territory and those of the Company where the impact was potentially material and could be reasonably estimated. The significant accounting policies of Dakota Territory conform, in all material respects, to those of the Company. A final review will be completed after closing to ensure all differences have been identified and recognized. Certain expenses have been reclassified to conform to the Company’s consolidated financial statement presentation.

3. PRO FORMA ASSUMPTIONS AND ADJUSTMENTS

The unaudited pro forma financial statements reflect the following assumptions and adjustments to give effect to the Transaction, as if the Transaction had occurred on April 1, 2020 for the consolidated income statements. The Company is not aware of any additional reclassifications that would have a material impact on the unaudited pro forma financial information that are not reflected in the pro forma adjustments. Assumptions and adjustments made are as follows:

To conform the pro forma financial information to the financial statement line items presented by the Company, as Dakota Territory presented all general and administrative expenses as one line item, whereas the Company presented them in a number of line items.

To reflect the Transaction as if it had occurred on April 1, 2020, the results of Dakota Territory for the period from consolidation in the Company in October 2020 to March 31, 2021 have been adjusted to reflect the 12 month operations of Dakota Territory in the pro forma statement of operations. This eliminates the double counting of expenses of Dakota Territory for the period from consolidation in the Company in October 2020 to March 31, 2021 that would have occurred otherwise.

The gain on derivative assets recorded in the Company’s statement of operations has been adjusted as the gain on derivative assets would have been eliminated on consolidation had the Transaction occurred on April 1, 2020 and is thus excluded from the pro forma statement of operations.

The interest expense incurred by Dakota Territory was incurred as part of the Transaction with the Company in the year and would have been eliminated on consolidation had the Transaction occurred on April 1, 2020 and is thus excluded from the pro forma statement of operations.

As at March 31, 2021 the assets and liabilities of Dakota Territory were recognized in the Company’s balance sheet. This adjustment eliminates the double counting of Dakota Territory assets and liabilities in the pro forma balance sheet.

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the year ended March 31, 2021
(Unaudited, expressed in United States dollars, unless otherwise stated)

To reflect the acquisition of the non-controlling interest in Dakota Territory by the Company upon the issuance of the Company shares to Dakota Territory stockholders per the Transaction. Prior to the Transaction, the non-controlling interest in the Company’s financial statements related to the portion of Dakota Territory it does not own, and subsequent to the completion of the Transaction, Dakota Territory will be a wholly owned subsidiary of the Company.

To reflect the share consideration issued as a result of the Transaction.

4. PRO FORMA SHARE CAPITAL

After giving effect to the pro forma adjustments described in note 3, the Company’s issued and outstanding share capital would be as follows:

	Common Shares		Amount
Issued and outstanding, March 31, 2021		35,136,029		$	35,136
Share consideration issued in connection with the Transaction		35,186,537			35,186
Pro forma balance as at March 31, 2021		70,322,566		$	70,322

5. PRO FORMA INCOME AND COMPREHENSIVE INCOME PER SHARE

Pro forma basic and diluted loss per share for the year ended March 31, 2021 has been calculated based on the actual weighted average number of common shares of the Company outstanding for the respective periods; as well as the number of common shares issued in connection with the Transaction as if such shares had been outstanding since April 1, 2020:

	Year ended March 31, 2021
Pro forma net loss		$	(2,704,894)
Actual weighted average number of basic and diluted common shares outstanding			23,165,060
Impact of additional common shares issued in connection with the Transaction (note 3)			22,129,602
Pro forma weighted average number of basic and diluted common shares outstanding			45,294,662
Pro forma basic and diluted loss per share		$	(0.06)

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UNAUDITED PRO FORMA BALANCE SHEET AS AT DECEMBER 31, 2021

(Unaudited, expressed in United States dollars, except for per share amounts)

	Dakota Territory Resource Corp.			Dakota Gold Corp. (formerly “JR Resources Corp.”)			Pro Forma Adjustments			Notes	Pro Forma
Current assets
Cash and cash equivalents		$	46,637,914		$	46,790,482		$	(46,637,914)	3(c)		$	46,790,482
Receivable			—			22,884			—				22,884
Prepaid expenses and other current assets			173,604			345,274			(173,604)	3(c)			345,274
Total current assets			46,811,518			47,158,640			(46,811,518)				47,158,640
Non-current assets
Mineral properties, net			20,297,409			72,892,131			(20,297,409)	3(c)			72,892,131
Property and equipment, net			1,341,108			1,341,108			(1,341,108)	3(c)			1,341,108
Total assets			68,450,035			121,391,879			(68,450,035)				121,391,879
Current liabilities
Accounts payable and accrued liabilities			619,597			1,185,755			(619,597)	3(c)			1,185,755
Total current liabilities			619,597			1,185,755			(619,597)				1,185,755
Non-current liabilities
Deferred tax liability			—			9,016,766			—				9,016,766
Total liabilities			619,597			10,202,521			(619,597)				10,202,521
Stockholders’ equity
Share capital			70,828			35,641			(70,828)	3(c)			70,828
									35,187	3(e)
Additional paid in capital			98,956,100			44,001,171			(43,645,036)	3(c), 3(d)			99,312,235
Retained earnings (deficit)			(31,196,490)			11,806,295			31,196,490	3(c)			111,806,295
Equity attributable to stockholders			67,830,438			55,843,107			(12,484,187)				111,189,358
Non-controlling interest			—			55,346,251			(55,346,251)	3(d)			—
Total stockholders’ equity			67,830,438			111,189,358			(67,830,438)				111,189,358
Total stockholders’ equity and liabilities		$	68,450,035			121,391,879			(68,450,035)			$	121,391,879

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UNAUDITED PRO FORMA INCOME STATEMENT FOR
THE NINE MONTH PERIOD ENDED DECEMBER 31, 2021

(Unaudited, expressed in United States dollars, except for per share amounts)

	Dakota Territory Resource Corp.			Dakota Gold Corp. (formerly “JR Resources Corp.”)			Reclassification (Note 3(a))			Pro forma adjustments			Notes	Pro Forma
Consulting		$	—		$	507,404		$	—		$	—			$	507,404
Exploration costs			6,117,247			6,117,247			—			(6,117,247)	3(b)			6,117,247
Office, travel and general			—			15,378,269			15,196,310			(15,196,310)	3(b)			15,378,269
Professional fees			—			1,635,989			1,204,348			(1,204,348)	3(b)			1,635,989
General and administrative expenses			16,427,931			—			(16,427,931)			—				—
Loss from operations. .			(22,545,178)			(23,638,909)			27,273			22,517,905				(23,638,909)
Other income (expense)
Foreign exchange loss			—			(49,543)			(27,273)			27,273	3(b)			(49,543)
Interest income			16,094			16,094			—			(16,094)	3(b)			16,094
Interest expense			(101)			(70,854)			—			101	3(b)			(70,854)
Loss on settlement of debt			(124,521)			(124,521)			—			124,521	3(b)			(124,521)
			(108,528)			(228,824)			(27,273)			135,801				(228,824)
Net income (loss) before income tax			(22,653,706)			(23,867,733)			—			22,653,706				(23,867,733)
Deferred tax benefit			—			381,692			—			—				381,692
Net income (loss)		$	(22,653,706)		$	(23,486,041)		$	—		$	22,653,706			$	(23,486,041)
Basic and diluted earnings (loss) per share		$	(0.35)		$	(0.39)									$	(0.33)
Weighted average shares outstanding. .			—			—			—
Basic and diluted			65,079,372			35,561,255						(29,892,835)				70,747,792

The accompanying notes are an integral part of these pro forma financial statements.

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the nine month period ended December 31, 2021
(Unaudited, expressed in thousands of United States dollars, unless otherwise stated)

1. BASIS OF PRESENTATION AND DESCRIPTION OF THE TRANSACTION

These unaudited pro forma financial statements have been prepared in connection with the transaction between Dakota Gold Corp. (formerly “JR Resources Corp.") (the “Company”) and Dakota Territory Resource Corp. (“Dakota Territory”), which closed on March 31, 2022 (the “Transaction”).

Under the terms of the Transaction between the Company and Dakota Territory, Dakota Territory stockholders received one share of the Company for each share of Dakota Territory. The Company stockholders continued to hold shares of the Company. On March 8, 2022, prior to the closing of the Transaction, the Company completed a reverse share split such that the total number of Company shares was proportionally reduced to 35,641,667 Company shares.

In addition, at the closing of the Transaction, (i) each outstanding option to purchase Dakota Territory common stock, whether vested or unvested, was assumed and converted into an option with respect to a number of shares of Company common stock in the manner set forth in the Amended and Restated Agreement and Plan of Merger, dated as of September 10, 2021, by and among Dakota Territory, the Company and the other parties thereto (the “merger agreement”), (ii) each outstanding award of restricted stock units with respect to shares of Dakota Territory common stock was assumed and converted into the right to receive an award of restricted stock units representing a right to receive a number of shares of Company common stock in the manner set forth in the merger agreement, and (iii) the Company, which previously had been named “JR Resources Corp.,” changed its name to “Dakota Gold Corp.”

The transaction described above is accounted for as an equity transaction in which Company shares were issued to acquire the non-controlling interest held by Dakota Territory shareholders. The share issuance and reverse share split has been reflected as an adjustment to the basic and diluted weighted average shares outstanding in the pro forma income statement.

These unaudited pro forma financial statements have been prepared using information derived from, and should be read in conjunction with, the consolidated financial statements of the Company for the nine-month period ended December 31, 2021 and the consolidated financial statements of Dakota Territory for the nine-month period ended December 31, 2021. The historical financial statements of the Company and Dakota Territory were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These pro forma financial statements have been compiled from and include:

An unaudited pro forma statement of operations for the nine-month period ended December 31, 2021 combining:

The consolidated statement of operations of the Company for the nine-month period ended December 31, 2021;

ii.

The consolidated statement of operations of Dakota Territory for the nine-month period ended December 31, 2021; and

iii.

The adjustments described in note 3.

An unaudited pro forma balance sheet as at December 31, 2021 combining:

The consolidated balance sheet of the Company as at December 31, 2021;

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the nine month period ended December 31, 2021
(Unaudited, expressed in thousands of United States dollars, unless otherwise stated)

ii.

The consolidated balance sheet of Dakota Territory as at December 31, 2021; and

iii.

The adjustments described in note 3.

The unaudited pro forma statement of operations for the nine-month period ended December 31, 2021 has been prepared as if the Transaction had occurred on April 1, 2021.

2. SIGNIFICANT ACCOUNTING POLICIES

3. PRO FORMA ASSUMPTIONS AND ADJUSTMENTS

The unaudited pro forma financial statements reflect the following assumptions and adjustments to give effect to the Transaction, as if the Transaction had occurred on March 31, 2021 for the consolidated income statements. The Company is not aware of any additional reclassifications that would have a material impact on the unaudited pro forma financial information that are not reflected in the pro forma adjustments. Assumptions and adjustments made are as follows:

To reflect the Transaction as if it had occurred on March 31, 2021, the results of Dakota Territory for the period have been adjusted to reflect the nine month operations of Dakota Territory in the pro forma income statement. This eliminates the double counting of expenses of Dakota Territory for the nine-month period ended December 31, 2021 that are already consolidated into the Company’s income statement for the nine-month period ended December 31, 2021.

As at December 31, 2021 the assets and liabilities of Dakota Territory were recognized in the Company’s balance sheet. This adjustment eliminates the double counting of Dakota Territory assets and liabilities in the pro forma balance sheet.

To reflect the acquisition of the non-controlling interest in Dakota Territory by the Company upon the issuance of Company shares to Dakota Territory stockholders per the Transaction. Prior to the Transaction, the non-controlling interest in the Company’s financial statements relates to the portion of Dakota Territory it does not own, and subsequent to the completion of the Transaction, Dakota Territory will be a wholly owned subsidiary of the Company.

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Dakota Gold Corp.

Pro Forma Notes to the Financial Statements

For the nine month period ended December 31, 2021
(Unaudited, expressed in thousands of United States dollars, unless otherwise stated)

To reflect the share consideration issued as a result of the Transaction.

4. PRO FORMA SHARE CAPITAL

After giving effect to the pro forma adjustments described in note 1, the Company’s issued and outstanding share capital would be as follows:

	Common Shares Amount
Issued and outstanding, December 31, 2021		35,641,079	$	35,641
Share consideration issued in connection with the Transaction		35,186,537		35,187
Pro forma balance as at December 31, 2021		70,827,616	$	70,828

5. PRO FORMA INCOME AND COMPREHENSIVE INCOME PER SHARE

Pro forma basic and diluted loss per share for the nine-month period ended December 31, 2021 has been calculated based on the actual weighted average number of common shares of the Company outstanding for the respective periods; as well as the number of common shares issued in connection with the Transaction as if such shares had been outstanding since March 31, 2021:

	Nine-month period ended December 31, 2021
Pro forma net loss		$	(23,486,041)
Actual weighted average number of basic and diluted common shares outstanding			35,561,255
Impact of additional common shares issued in connection with the Transaction (note 3)			35,186,537
Pro forma weighted average number of basic and diluted common shares outstanding			70,747,792
Pro forma basic and diluted loss per share			(0.33)

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INFORMATION ABOUT DAKOTA GOLD CORP.

Dakota Gold Corp. is a Nevada corporation that was formed in British Columbia, Canada in 2017 and continued to Nevada in 2020. Prior to the closing of the transactions with Dakota Territory, the Company was privately held, and the Company’s sole investment and focus was its majority investment in Dakota Territory and the completion of the acquisition of Dakota Territory described herein and in the merger agreement. On March 31, 2022, pursuant to the merger agreement, the Company acquired Dakota Territory, which became a wholly-owned subsidiary of the Company. For more information about the business of Dakota Territory, see “Information About Dakota Territory Resource Corp.” beginning on page 35.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION OF DAKOTA GOLD CORP.

This management’s discussion and analysis should be read in conjunction with the audited annual financial statements for the fiscal years ended March 31, 2021 and 2020 and the condensed consolidated financial statements for the three and nine months ended December 31, 2021 and 2020 (together, the “Financial Statements”) of Dakota Gold Corp. (the “Company”) and notes thereto as set forth herein. Readers are also urged to carefully review and consider the various disclosures made by the Company, which attempt to advise interested parties of the factors which affect the Company’s business. The Financial Statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

Overview

In May 2020, the Company entered into an agreement with Dakota Territory (the “Agreement”) whereby Dakota Territory granted the Company the right to purchase up to 35,641,667 shares of common stock of Dakota Territory at $0.60 per share (approximately 64% on a fully diluted basis) in one or more closings on or prior to October 15, 2020. Upon execution of the Agreement, the Company and Dakota Territory entered into an amended and restated promissory note in the amount of $1,450,000, of which $300,000 was advanced in February 2020 and $1,150,000 was advanced in May 2020.

In October 2020, the Company and Dakota Territory effected the first closing under the Agreement whereby the Company purchased 17,416,667 shares of common stock of Dakota Territory for aggregate consideration of $10,450,000, including $9,000,000 in cash and $1,450,000 upon conversion of the principal amount of the May 2020 promissory note. In addition, the Company and Dakota Territory entered into amending agreements on October 15, 2020 and February 15, 2021 whereby (i) it was agreed to extend the balance of the May 2020 purchase right until March 17, 2021, and would allow the Company the option to purchase up to an additional 18,225,000 shares of common stock for up to an additional $10,935,000, and (ii) Dakota Territory created two director vacancies and agreed to allow for two the Company nominees to be appointed, of which a nominee was appointed as a director to fill one vacancy on October 15, 2020. Immediately after the first closing, the Company owned 49.42% of Dakota Territory’s common stock outstanding and had the right to purchase a further 18,225,000 shares of Dakota Territory’s common stock. In addition, the Company substantially controlled the operational and financial decisions of Dakota Territory though contractual agreement related to the use of the investment proceeds.

In March 2021, the Company and Dakota Territory effected the second and final closing under the Agreement, as amended, whereby the Company purchased 18,225,000 shares of common stock of Dakota Territory for an aggregate consideration of $10,935,000, $10,635,000 in cash and $300,000 upon conversion of the principal amount of a promissory note issued in January 2021. The Company’s interest in Dakota Territory increased from 49.42% on the first closing to 63.42% and the Company maintained control of Dakota Territory.

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On March 8, 2022, prior to the closing of the transactions, the Company completed a reverse share split such that the total number of Company shares was proportionately reduced to 35,641,667 Company shares.

The Company’s goal is to create stockholder value through the acquisition, responsible exploration and future development of high caliber gold properties in the Homestake District of South Dakota through its acquisition of Dakota Territory. The Company and Dakota Territory’s management and technical teams cumulatively have several hundred years of international mining and exploration experience and key personnel have more than 50 combined years in the Homestake District, mostly with the Homestake Mining Company, as well as other exploration companies that worked in the region. The Company believes this experience uniquely positions the Company and will allow it to leverage its direct experience and knowledge of past exploration and mining activities in the Homestake District with modern exploration and mining techniques and understanding to focus its programs and build upon dominance where the historic Homestake Mining Company left off in the 1990s.

The Homestake District has yielded approximately 44.6 million ounces of gold production with most of it coming from within a small area. The production ledges of the old mine define a cumulative surface projection area of much less than 3 square miles. Homestake Mining Company’s historic gold production and exploration in the Homestake District is overwhelmingly focused on the underground mine. Modern statistical studies and understanding of the distribution of large gold camps around the world identifies that large gold deposits generally occur in clusters. The Company believes the Homestake District is generally underexplored and has lacked the modern efforts required to search for gold deposits especially under the cover of younger sedimentary and igneous rocks that dominate the surface. The Homestake District is a safe low-cost jurisdiction with well-developed mining infrastructure and is a jurisdiction in which regulatory authorities have consistently demonstrated a willingness to work with responsible operators to permit well- planned compliant projects.

Since 2012, Dakota Territory has consistently pursued a strategy of expanding its portfolio of brownfields properties located exclusively within the Homestake District to build a dominant land position with the goal of consolidating the remaining mineral potential. Dakota Territory property acquisitions are focused and based on past exploration, the access to proprietary data sets it has assembled over the years, and new research Dakota Territory has conducted on the gold systems that created the deposits in the Homestake District. Dakota Territory has not established that any of its projects or properties contain any proven or probable reserves under Subpart 1300 of Regulation S-K.

Dakota Territory believes the Homestake District is located in a safe, low-cost jurisdiction with well-developed infrastructure and is in a regulatory jurisdiction in which authorities have consistently demonstrated a willingness to work with responsible operators to permit well-planned compliant projects.

Planned Activities

Dakota Territory’s planned activities during fiscal 2022 are focused on advancing its Maitland, Blind Gold, City Creek and Tinton projects to the initial drilling stage and to continue to evaluate and build on its overall property position in the Homestake District of South Dakota.

Dakota Territory’s experienced technical group and consultants continue to model data acquired by its regional high-definition airborne geophysical survey, supplemented by ground geophysical surveys completed in 2021, to enhance possible drill targets, as well as to screen targets on other brownfields areas of interest within the District. Several field sampling and mapping programs have been initiated and the Company continues to locate, evaluate and add to the historic information in its regional and project level data sets from the 145-year-old Homestake Mining Company files as well as from other sources.

Permitting and site preparations have been completed for the first drilling program on the iron- formation target and other tertiary-age replacement targets in the Maitland area and drilling has commenced. Preparations for drilling on iron-formation targets, the unconformity target and other types of tertiary-age replacement targets on the City Creek and Richmond Hill projects are on schedule for completion before the arrival of a second drill rig, approximately in late February. Permit and environmental field work for the

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Blind Gold and Tinton project areas has also been initiated. Targets in some of the other brownfields areas may also be identified and advanced for drilling as exploration activities continue throughout the year.

Table: Fiscal Year 2022 Proposed Exploration Expenditures (millions)

General & administrative	$	3.4
Drilling, Field programs/Met Testing/Data Compilation	$	6.2
Property Acquisition	$	3.8
TOTAL	$	13.4

Since the Company is an exploration stage company and has not generated revenues to date, its cash flow projections are subject to numerous contingencies and risk factors beyond its control, including exploration and development risks, competition from well-funded competitors, and its ability to manage growth. The Company can offer no assurance that its expenses will not exceed its projections.

Liquidity and Capital Resources

The Company is an exploration-stage company and does not generate revenues. As such, the Company has historically financed the Company’s operations and the acquisition and exploration of the Company’s mineral properties through the issuance of share capital.

As of December 31, 2021, the Company had working capital of approximately $45,973,000 and the Company’s retained earnings as of December 31, 2021 was approximately $11,806,000. The Company had a net loss for the nine months ended December 31, 2021 of approximately $23,486,000. During the nine months ended December 31, 2021, Dakota Territory issued a total of 11,203,661 shares of common stock for net proceeds of approximately $49,516,000.

During the Company’s fiscal year ending March 31, 2022, the Company’s plan is to spend approximately $13.4 million. The timing of these expenditures is dependent upon a number of factors, including the availability of contractors.

Nine months ended December 31, 2021 and 2020

Cash flows used in operating activities

During the nine months ended December 31, 2021 and 2020, the Company’s cash flow used in operating activities was $6,933,021 and $1,544,085, respectively. Cash used in operations for the December 31, 2021 period increased year over year as the Company increased the amount of land claims and associated annual claim maintenance costs. In addition, the Company completed an airborne geophysical survey and engaged additional personnel to review and commence the compilation of historical geological data obtained through the Barrick option agreements.

Cash flows used in investing activities

During the nine months ended December 31, 2021 and 2020, cash flow used in investing activities was $6,753,648 and $2,152,551, respectively. In the period ended December 31, 2021, the cash used for investing activities consisted primarily of the acquisition of land. In the period ended December 31, 2020 the cash used for investing consisted primarily of a loan from the Company to Dakota Territory. The loan was later converted into shares as part of the acquisition of Dakota Territory.

Cash flows used in financing activities

During the nine months ended December 31, 2021 and 2020, cash flow from financing activities was $49,032,486 and $20,151,067, respectively. In the nine months ended December 31, 2021, Dakota Territory issued shares to receive proceeds of $49.516 million.

Fiscal years ended March 31, 2021 and 2020

Cash flows used in operating activities

During the years ended March 31, 2021 and 2020, cash flow used in operating activities was $2,166,825 and $169,294, respectively. Cash used in operations for the March 31, 2021 period increased year over year

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as the Company increased the amount of land claims and associated annual claim maintenance costs. In addition, the Company completed an airborne geophysical survey and engaged additional personnel to review and commence the compilation of historical geological data obtained through the Barrick option agreements.

Cash flows used in investing activities

During the years ended March 31, 2021 and 2020, cash flow used in investing activities was $4,731,043 and $728,459, respectively. In the period ended March 31, 2021, the cash used for investing activities consisted primarily of the acquisition of land offset by the cash acquired. In the period ended September 30, 2020 the cash used for investing consisted primarily of a loan from the Company to Dakota Territory. The loan was later converted into shares as part of the acquisition of Dakota Territory.

Cash flows used in financing activities

During the years ended March 31, 2021 and 2020, cash flow from financing activities was $18,200,768 and $1,037,591, respectively. In the period ended December 31, 2021, the Company issued shares to receive proceeds of $22.5 million, partially offset by a dividend to non-controlling interest shareholders of $4.3 million.

Results of Operations

Nine months ended December 31, 2021 and 2020

Revenue and Other Income

The Company had no operating revenues during the nine months ended December 31, 2021 and 2020. For the nine months ended December 31, 2020, the Company recorded a gain on derivative assets of approximately $27,088,000 in connection to the Agreement.

Exploration Costs

During the nine months ended December 31, 2021 and 2020, the Company’s exploration costs totaled approximately $6,117,000 (including $3,870,000 of share-based compensation expense) and $193,000, respectively. Included in these costs were payments of annual claim maintenance fees related to the Company’s mineral properties. The increase year over year related to the Company having additional funds from financing to carry out the airborne geophysical survey and review and compilation of historical geological data.

General and Administrative

The Company’s general and administrative expenses for the nine months ended December 31, 2021 and 2020 were approximately $17,522,000 and $796,000, respectively. These expenditures were primarily for approximately $12,484,000 (9 months ended December 30, 2020 — $0) of share-based compensation expense in the nine months ended December 31, 2021, $2,894,000 (9 months ended December 30, 2020 — $241,000) for office, travel and general expenses necessary for the Company’s operations, $1,636,000 (9 months ended December 30, 2020 — $341,000) for legal, accounting & professional fees and $507,000 (9 months ended December 30, 2020 — $213,000) for consulting fees.

The Company had losses from operations for the nine months ended December 31, 2021 and 2020 totaling approximately $23,639,000 and $989,000, respectively. The Company had a total net loss for the nine months ended December 31, 2021 of approximately $23,486,000 and net income of approximately $26,333,000 for the nine months ended December 31, 2020. During the nine months ended December 31, 2020, and in connection with the Agreement, the Company recorded a gain on derivative assets of approximately $1,837,000 in relation to the conversion of the promissory note with Dakota Territory and a gain on derivative assets of approximately $25,251,000 related to the detachable option agreement providing the Company the right to acquire a total of 35,641,667 shares of Dakota Territory’s common stock.

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Off-Balance Sheet Arrangements

For the nine months ended December 31, 2021 and 2020, the Company had off-balance sheet arrangements for annual payments in relation to the mineral leases as disclosed in Note 3 of the condensed consolidated interim financial statements for the nine months ended December 31, 2021 and 2020.

Fiscal years ended March 31, 2021 and 2020

Revenue

The Company had no operating revenues during the fiscal years ended March 31, 2021 and 2020. For the fiscal year ended March 31, 2021, the Company recorded a gain on derivative assets of approximately $27,088,000 in connection to the Agreement. As a result of this gain, the Company had an accumulated retained earnings of approximately $25,679,000 as of March 31, 2021.

Exploration Costs

During the years ended March 31, 2021 and 2020, the Company’s exploration costs totaling approximately $272,000 and $48,000, respectively. Included in these costs were for payments of annual claim maintenance fees related to the Company’s mineral properties. The increase year over year related to the Company having additional funds from financing to carry out the airborne geophysical survey and review and compilation of historical geological data.

General and Administrative

The Company’s general and administrative expenses for the years ended March 31, 2021 and March 31, 2020 were approximately $1,820,000 and $122,000, respectively. These expenditures were primarily for consulting, legal, accounting and professional fees, investor relations and other general and administrative expenses necessary for the Company’s operations.

The Company had income (loss) before income taxes from operations for the fiscal year ended March 31, 2021 totaling approximately $25,107,000 and loss of $193,000 for the fiscal year ended March 31, 2020. The Company had net income for the fiscal year ended March 31, 2021 of approximately $25,520,000 and net loss of $193,000 for the fiscal year ended March 31, 2020.

During the fiscal year ended March 31, 2021, and in connection with the Agreement with Dakota Territory, the Company recorded a gain on derivative assets of $1,837,000 in relation to the conversion of the promissory note with Dakota Territory and a gain on derivative assets of $25,251,000 related to the detachable option agreement providing the Company the right to acquire a total of 35,641,667 shares of Dakota Territory’s common stock.

Off-Balance Sheet Arrangements

For the fiscal years ended March 31, 2021 and 2020, the Company had no off-balance sheet arrangements.

Critical Accounting Estimates

Management’s discussion and analysis of financial condition and results of operations is based on the Financial Statements, which have been prepared in accordance with U.S. GAAP. Preparation of financial statements requires management to make assumptions, estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and the related disclosures of contingencies.

Management bases its estimates on various assumptions and historical experience, which are believed to be reasonable; however, due to the inherent nature of estimates, actual results may differ significantly due to changed conditions or assumptions. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that the Company’s financial statements are fairly presented in accordance with U.S. GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from the Company’s assumptions and estimates, and such differences

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could be material. Management believes that the following critical accounting estimates and judgments have a significant impact on the Company’s financial statements; Valuation of options granted to Company directors and officers using the Black-Scholes model, valuation of the derivative assets using the Black- Scholes model, and the fair value of mineral properties. The accounting policies are described in greater detail in Note 2 to the Company’s audited annual financial statements for the fiscal year ended March 31, 2021.

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INFORMATION ABOUT DAKOTA TERRITORY RESOURCE CORP.

Dakota Territory Resource Corp. was incorporated in Nevada in 2002. Dakota Territory is engaged in the business of acquisition and exploration of mineral properties within the Homestake District of South Dakota. To date, while no development or mining activities have commenced, Dakota Territory’s strategy is to move projects from exploration to development and finally on to mining as results of exploration may dictate. Dakota Territory’s management and technical teams have extensive mining and exploration experience in the Homestake District and it intends to leverage its experience together with its business presence in South Dakota to create value for the Company’s stockholders. Dakota Territory currently holds eleven brownfield project areas in the district comprised of 1,720 unpatented lode claims and a combination of surface and mineral leases covering a total of approximately 38,918 acres.

On March 31, 2022, pursuant to the merger agreement, the Company acquired Dakota Territory, which became a wholly-owned subsidiary of the Company.

Properties

Dakota Territory has not established that any of its properties, mineral interests or rights contain proven or probable reserves, as defined under Subpart 1300 of Regulation S-K. Exploration by Dakota Territory on its properties has been limited to field sampling programs, field mapping programs, geophysical surveys and a campaign to acquire historic data sets that were known to exist for its property and the balance of the Homestake District. Much of the important historic data has been digitized and assembled to a new database in electronic form. In the case of historic geophysical data, the data has been digitized and reprocessed.

Exploration plans and budgets have been prepared for each of the Maitland, West Corridor, Ragged Top, Homestake Paleoplacer, City Creek, Tinton, Poorman Anticline, South Lead / Whistler Gulch, the Barrick Option, Richmond Hill and the Blind Gold Properties. The Homestake Paleoplacer Property has been permitted with SDDANR, and Dakota Territory believes the Homestake Paleoplacer Property is drill-ready with the State in receipt of the $20,000 reclamation bond. Current exploration plans may be modified pending the ongoing modeling and interpretation of the Company’s airborne magnetic and radiometric survey data acquired in 2020. Dakota Territory’s technical team is currently reconciling its high-resolution geophysics with its extensive geology and geochemistry data sets to improve its ability to map and project lithology and structure in areas where Dakota Territory has less historic data.

None of Dakota Territory’s property is sufficiently drilled to prepare a preliminary economic assessment. However, Dakota Territory’s management and technical teams have prepared internal scoping studies for the Homestake Paleoplacer Property and the Blind Gold Property iron-formation and tertiary aged replacement targets.

Based on its experience in the district, Dakota Territory has modeled the exploration, development, mining and closure for the size and grade of similar deposits in a similar geological setting elsewhere in the district for those properties. The strategy of this financial modeling is to determine whether, if Dakota Territory is technically successful defining its deposit expectation with drill holes, any identified deposit would make commercial sense to ultimately develop.

The Black Hills has well developed power infrastructure. All of Dakota Territory’s properties have power on the property now, or nearby access to the property with the potential to be upgraded for production if exploration proves successful. The Company believes access to water will not be a significant issue for any development purpose at any property.

Property Costs

As of December 31, 2021 and March 31, 2021, Dakota Territory’s mineral properties totaled $20,297,409 and $5,337,072, respectively. As of December 31, 2021, Dakota Territory is in the exploration stage and has not commenced amortization of its properties. Dakota Territory capitalizes certain costs to its projects when the costs can be specifically attributable to a project, or when it is reasonable to allocate those costs. Certain costs are not allocated as they are regional expenditures in nature.

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Dakota Territory has made acquisition payments for the following exploration properties to date:

	Regional and Other			Barrick Option			Blind Gold			Maitland			Ragged Top			West Corridor			Total
Balance at March 31, 2021		$	298,476		$	—		$	218,596		$	4,820,000		$	—		$	—		$	5,337,072
Additions			—			6,150,000			—			986,536			1,515,000			1,597,243			10,248,779
Balance at September 30, 2021			298,476			6,150,000			218,596			5,806,536			1,515,000			1,597,243			15,585,851

Gold Properties — Black Hills General

[MISSING IMAGE: tm2130145d2-map_dakota4clr.jpg]

Dakota Territory maintains 100% ownership of 11 mineral properties in the district comprised of 1,720 unpatented claims and a combination of surface leases and/or ownership covering a total of approximately 38,918 acres located in the Black Hills of South Dakota, including the Blind Gold, City Creek, Tinton, West Corridor, Ragged Top, Poorman Anticline, Maitland, South Lead / Whistler Gulch, the Barrick Option, Richmond Hill and Homestake Paleoplacer Properties, all of which are located in the heart of the Homestake District.

The Homestake District is a favorable geologic gold setting with three unique gold deposit types that the Company believes have yielded approximately 44.6 million ounces of gold production over the past 140 years, including Proterozoic-age Homestake iron-formation hosted gold deposits, Tertiary-age replacement gold deposits and Eo-Cambrian Homestake Paleoplacer gold deposits.

Dakota Territory has based the acquisition of its Black Hills property position on more than 44 years of combined mining and exploration experience in the Homestake District with Homestake Mining Company of California and the knowledge gained from previous exploration and mining efforts. Dakota Territory believes that its properties hold exploration targets for all three gold deposit types known to exist in the district.

The Black Hills is a low-cost jurisdiction with well-developed infrastructure and an existing experienced mining and exploration workforce. South Dakota’s regulatory authorities have historically demonstrated a willingness to work with responsible operators to permit well-planned compliant projects and South Dakota’s exploration and mining regulations are reasonable and comparable to other mining jurisdictions within the United States.

Dakota Territory’s business strategy is to focus on the search of a repeat of the Homestake Deposit in the iron-formation host that is distributed across the district, largely under the cover of the younger igneous and sedimentary rocks that dominate the surface. Dakota Territory continues to expand its land position in the district with the objective of simultaneously developing less capital-intensive lower risk gold targets that could be brought into production in the near term.

Blind Gold Property

The Blind Gold Property consists of 191 unpatented lode-mining claims. In total, the Blind Gold Property covers approximately 3,387 acres in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 5N, Ranges 2 and 3 E covering portions of Sections 1, 2, 11, 12 13 and 14 in Range 2E and Sections 5,6,7,8 and 18 in Range 3E.

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Dakota Territory acquired 84 of the claims through the acquisition of North Homestake Mining Company in September 2012. In December 2012, Dakota Territory’s Blind Gold Property position was increased through the acquisition of 23 additional claims from Black Hills Gold Exploration LLC. Dakota Territory added 63 contiguous claims on its west and south western property boundary in February 2020 and in December 2020, 21 additional claims were at the western boundary of the property. Dakota Territory owns a 100% interest in the 191 claims that comprise the main block of the Blind Gold Property with no known encumbrance. There are no known private surface rights owners within the bounds of the main block of the Blind Gold Property with all surface rights under the control of the US Forest Service. Annual claim maintenance fees are $165 per claim, or a total of $31,515 for the claims that comprise the main block of the Blind Gold Property. Annual claim maintenance fees are due before September 1st of each year.

Notice must be filed with and approved by the US Forest Service (“USFS”), and the South Dakota Division of Environment and Natural Resources (“SDDANR”) prior to undertaking any exploration activities. The notice describes the proposed exploration activities and any remedial reclamation deemed necessary. The various government agencies review the application to ensure there will be no deleterious impacts as a result of activity on the claims prior to granting any approvals for the proposed work.

Access to the property is gained by traveling 4.3 miles south-southeast from the City of Spearfish along the Maitland Road (Forest Service 195). Alternately, the area can be accessed from the south via the same Maitland Road from Central City. The northern segment of the property can be accessed from the Maitland Road via Forest Service Road 195-2A and the southern portion can be accessed via the Paradise Gulch Road. In addition, various forest service roads exist within the property.

The Blind Gold Property is located approximately 4 miles northwest and on structural trend with the Homestake Gold Mine. In the 1980′s and 1990’s Homestake Mining Company’s work in the District extended and Homestake iron-formation host under cover and demonstrated the repeatability of Homestake iron- formation hosted gold deposits within the structural corridor extending northwest of the mine.

In addition to the exploration potential for gold hosted in the Homestake iron-formation, the Blind Gold Property holds exploration potential for Tertiary-aged gold and silver replacement deposits typical of the District, with the mineralization hosted in the Cambrian Deadwood formation and to a lesser degree the Paha Sapa Limestone. The formation of Tertiary-age gold-silver replacement deposits is generally dependent on fault and fracture structures necessary to the transportation of mineralizing fluids and proximity to the preferential intrusive bodies, both of which are present at the Blind Gold Property. Tertiary-age gold mineralization is evidenced across the Blind Gold Property by numerous mapped prospect workings dating from the turn of the century in the Paha Sapa Limestone, Phonolite intrusive and Deadwood formation where it outcrops at the southwest corner of the property. The Blind Gold Property is an exploration target for the on-trend continuation of Tertiary aged gold-silver replacement deposits in the preferred Deadwood formation host under the cover of the Paha Sapa limestone.

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Homestake Paleoplacer Property

The Homestake Paleoplacer Property consists of a total of 365 mineral acres covering approximately 5,700 feet of the projected northward extension of the Homestake Paleoplacer Channel Trend in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 5N, Range3E covering portions of Sections 20 and 21.

Dakota Territory acquired its original 14 unpatented Homestake Paleoplacer claims from Black Hills Gold Exploration LLC in December 2012. Dakota Territory owns a 100% interest in the 14 unpatented claims with no known encumbrance of any kind. There are no known private surface rights owners within the bounds of the property with all surface rights under the control of the US Forest Service. Annual claim maintenance fees are $165 per claim, or a total of $2,310 total for the 14 claims that comprise the original Homestake Paleoplacer Property. Annual claim maintenance fees are due before September 1st of each year.

In February 2014, Dakota Territory entered into an agreement to acquire surface and mineral title to 26.16 acres of the Squaw and Rubber Neck Lodes that comprise Mineral Survey 1706 in the Black Hills of South Dakota.

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The property is located immediately to the north and adjoining Dakota Territory’s 14 original unpatented claims group and was explored by Homestake Mining Company in the 1980’s.

In March 2014, Dakota Territory successfully closed a transaction with Deadbroke Mining Company, Inc. to purchase approximately 565.24 mineral acres in the Northern Black Hills of South Dakota. As part of the Deadbroke Mining Company Inc. property acquisition, Dakota Territory purchased an additional 64.39 mineral acres located immediately southwest and contiguous to Dakota Territory’s original unpatented claims group, including the historic Gustin, Minerva and Deadbroke Gold Mines.

In April 2017, Dakota Territory added an additional 141 acres of mineral property to the Homestake Paleoplacer Property through an Exploration and Mining Lease and Option to Purchase Property Agreement with Trucano Novelty Inc., of South Dakota. The property acquisition is located immediately north and contiguous to the original Homestake Paleoplacer Property.

Access to the property is gained by traveling 0.75 miles west-northwest from Central City along the Maitland Road (Forest Service 195). Alternately, the area can be accessed by traveling approximately 1.75 miles west-northwest from the City of Deadwood on the Mount Roosevelt Road (Forest Service 133).

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The first significant Black Hills gold event occurred approximately 1.74 billion years ago, depositing gold in the Homestake iron-formation. From the time of iron-formation gold deposition, Proterozoic erosion removed approximately 30,000 feet of rock from the earth’s crust and exposed the Homestake lode to an erosional event that distributed gold into drainages on the regolith surface forming high-grade gold paleoplacer deposits. The Homestake Paleoplacer deposit is characterized by gold bearing quartz pebble conglomerates, similar to the Jacobina conglomerate gold deposits of Bahia, Brazil, that were deposited to the north and away from the elevated exposure of the mineralized Homestake iron-formation source lode. Multi-ounce per ton gold grades were historically not uncommon to paleoplacer deposits, principally because the source gold lode was up graded by lateritic weathering processes prior to erosion and distribution of the gold into the ancient paleochannels.

560 million years ago, the Cambrian seas advanced and deposited marine sediments that eventually covered the primordial Black Hills highlands and sealed the paleoplacer gold deposits under cover.

Tertiary-age rhyolite intrusive rocks dominate the outcrop on the Homestake Paleoplacer Property, along with limited outcrops of Cambrian Deadwood formation contained within the rhyolite intrusive. The rhyolite is in the form of a sill/laccolith, 50 to 500 feet thick, that overlies the basal quartz pebble conglomerate units of Deadwood formation and the extensions of gold bearing paleoplacer sourced from the Homestake Lode.

Dakota Territory’s Paleoplacer Property includes the past producing Gustin, Minerva and Deadbroke Mines, which were the last three mines that produced from the channel and are located furthest to the north at the point where the channel disappears under the cover of the younger Cambrian sedimentary and Tertiary igneous rocks. The Deadbroke Mine began operations in the earliest days of the 1870’s Black Hills

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Gold Rush and continued to produce gold through the 1920’s by underground room and pillar methods at depths ranging from 100 to 200 feet below surface.

In 1973, Homestake Mining Company entered into a mining lease on the Deadbroke Property, based on interest generated by a report authored by Homestake Geologist, Ross R. Grunwald and titled “Ore Potential of The Deadbroke Mine and Other Northern Black Hills Conglomerate Ores”. In 1974, Homestake dewatered the Deadbroke Mine and conducted a comprehensive mine mapping and sampling program. A total of 214 channel samples were collected by Homestake Geologists from the perimeter of accessible stope and development headings, as well as from pillars left in stopes. The results of the 1974 Deadbroke Mine sampling program led to a subsequent 27-hole drill program in the 1980’s designed to explore for the extension of the paleochannel north of the Deadbroke Mine.

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City Creek Property

The City Creek Property consists of a group of 228 unpatented lode-mining claims and Fidelity, Cresson, Danube, Confidence, Perhaps, Combination No. 1, Combination No. 2 and Cuba patented lode claims, M.S. 1644, covering a total of approximately 4,328 acres in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 5N, Range3E covering portions of Sections 2, 3, 4, 9, 10, 11, 14 15, 16, 21 and 22.

Dakota Territory acquired the original block of 20 City Creek claims from Black Hills Gold Exploration LLC in December 2012. The patented lode claims Fidelity, Cresson, Danube, Confidence, Perhaps, Combination No. 1, Combination No. 2 and Cuba that comprise M.S. 1644 were acquired from Trucano Novelty Inc. in April 2017 with an addition 42 unpatented lode mining claims acquired by staking in November 2018. In July 2020, the Company recorded an additional 166 claims at the northern and eastern boundary of the City Creek block. Dakota Territory owns a 100% interest in the property with no known encumbrance of any kind. There are no known private surface rights owners within the bounds of the property with all surface rights on the unpatented portion of the property under the control of the US Forest Service. Annual claim maintenance fees are $165 per claim, or a total of $37,620 for the 228 claims that comprise the City Creek Property. Annual claim maintenance fees are due before September 1st of each year.

Access to southwest end of the property is gained by traveling 0.6 miles west-northwest from the City of Deadwood along the Mount Roosevelt Road (Forest Service 133). Alternately, the area can be accessed from US Highway 85 in the City of Deadwood. This highway also skirts along the eastern edge of the latest property acquisition.

The City Creek Property is located one mile northeast of the Homestake Open Cut, one mile northwest of the City of Deadwood and is a target for Homestake iron-formation hosted gold mineralization. The southern end of the City Creek Property geology is dominated by rocks of the Homestake stratigraphic sequence, including the Ellison, Homestake and Poorman formations that outcrop across the property. The Homestake iron-formation outcrop on the City Creek Property is complexly folded and represents the continuous Homestake iron-formation extension northeast of the Homestake Mine.

Numerous gold prospect pits and shallow underground workings in quartz-veined Homestake formation have been located at the City Creek Property and the stratigraphy has been mapped by both Homestake Mining Company and USGS geologists. The City Creek Property was also diamond drilled by Homestake Mining Company in the 1970’s and 1980’s.

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Tinton Property

The Tinton Property consists of a group of 428 unpatented lode-mining claims covering approximately 7,552 acres in the western portion of Lawrence County, South Dakota, and Crook County, Wyoming, USA. More specifically the claims lie within the Black Hills Meridian, Township 5N, Range1E covering portions of Sections 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 32, 33, 34, 35, and 36, and Township 4N, Range1E covering portions of Sections 3, 4, and 5, and within the 6th Principal Meridian, Township 51 N, Range 60 W covering portions of Sections 21 and 28.

Dakota Territory acquired the original block of 106 claims at Tinton in September 2019. Between October 2020 and July 2021, an additional 322 unpatented claims were staked to surround the original claim block with no known encumbrance of any kind. Dakota Territory owns a 100% interest in the property with no known encumbrance of any kind. There are no known private surface rights owners within the bounds of the claims with all surface rights on the unpatented portion of the property under the control of the US Forest Service. Annual claim maintenance fees are $165 per claim, or a total of $70,620 for the 428 claims that comprise the Tinton Property. Annual claim maintenance fees are due before September 1st of each year.

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remedial reclamation deemed necessary. The various government agencies review the application to ensure there will be no deleterious impacts as a result of activity on the claims prior to granting any approvals for the proposed work.

Access to the property is gained by traveling 8 miles south-southwest from the City of Spearfish along a series of paved and aggregate secondary roads. A network of these roads cut the property. Alternative ingress can be gained on similar roads from the town of Lead (via Savoy), located approximately 9 miles east- southeast of the property. Some of these roads are seasonal, as they are not plowed during the winter months.

Placer gold was first discovered in the Tinton area in 1876 and the local drainages were worked during the late 19th and early 20th centuries. No source-lode has yet been located for the modern gold placer deposits.

In the mid-1990s, Homestake Mining Company undertook an exploration program at Tinton that was based on the deposition models for the paleoplacer and modern placers associated with the Homestake Lode. Preliminary groundwork at that time indicated that the most likely source of the gold originated from an area east of the placer workings, over which a district wide ground gravity survey was conducted in an effort to locate iron-formation host rocks under the younger limestone beds that dominate the surface in the Tinton area. Based on the results of the geophysical survey, two deep core holes were subsequently drilled with intercepted rocks interpreted to be comparable with the suite of rocks at the site of the Homestake Mine.

Dakota Territory intends to resume the exploration begun by Homestake by building off the substantial work already invested in narrowing the search area.

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West Corridor Property

The West Corridor Property consists of 109 unpatented lode-mining claims and surface and mineral title to an additional 213 acres of patented land bring the total area covered to approximately 1,755 acres in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 5N, Range2E covering portions of Sections 13, 22, 24, 25, 26, 27, 28, 34 and 35, and Township 5N, Range3E covering portions of Sections 19, 20 and 30.

Dakota Territory staked the unpatented claims of West Corridor between February 2020 and July 2021. There is no known encumbrance of any kind and there are no known private surface rights owners within the bounds of the claims with all surface rights on the unpatented portion of the property under the control of the US Forest Service or the Bureau of Land Management. Annual claim maintenance fees are $165 per claim, or a total of $17,985 for the 109 claims that comprise the West Corridor Property. Annual claim maintenance fees are due before September 1st of each year.

Notice must be filed with and approved by the BLM, USFS, and the SDDANR prior to undertaking any exploration activities. The notice describes the proposed exploration activities and any remedial reclamation deemed necessary. The various government agencies review the application to ensure there will be no deleterious impacts as a result of activity on the claims prior to granting any approvals for the proposed work. 213 acres of patented land were purchased in May of 2021 from Terrence Tyler are subject to a 2% NSR Royalty held by Homestake Mining Company of California with a buyback right for 51% interest in the

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property subject to, among other provisions, the establishment of a 1,000,000-ounce reserve and/or inferred resource from one or more deposits located within a one-kilometer area of influence surrounding the property.

The West Corridor property is located just south of the mineral property Dakota Territory acquired from Deadbroke Mining Company in the Maitland Area in March of 2014, just north of the producing Wharf Mine (Coeur Mining) and just to the south and east of the former Richmond Hill Mine (Barrick Gold). Access to the property is gained by traveling 1 mile southwest of Lead SD on Highway 85/14A to State Highway 473 and then traveling west approximately 3.2 miles to Wharf Mine Road and continuing west approximately 1.2 miles before turning and traveling 1 mile north on the Richmond Hill Road.

The property is located on the western margin of the structural corridor that extends north of the Homestake Gold Mine. The property is a target for both Homestake Iron Formation hosted gold mineralization under the cover of younger sedimentary and igneous rocks that also host tertiary-aged replacement gold and silver mineralization in the area.

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Ragged Top Property

The Ragged Top Property consists of 52 unpatented lode-mining claims plus a combination of surface and mineral title to an additional 25 patented mining claims covering approximately 307 acres that were secured on March 9, 2021 through an option agreement with Donald Valentine of Steamboat Springs

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Colorado. On August 21, 2021, Dakota Territory purchased surface and mineral title to approximately 230 acres of patented land from Atlas Development Company. In total, the property covers approximately 1,380 acres in the western portion of Lawrence County, South Dakota, USA that lie within the Black Hills Meridian, Township 5N, Range2E covering portions of Sections 19, 20, 22, 28, 29, 30, 32, and 33, and Township 4 N, Range2E covering a portion of Section 5.

Dakota Territory staked the unpatented claims of the property between September, 2020 and March,2021.

Dakota Territory maintains 100% ownership of the property. There are no known encumbrances of any kind and there are no other known private surface rights owners within the bounds of the unpatented claims with all surface rights on that portion of the property under the control of the US Forest Service. Annual claim maintenance fees are $165 per claim, or a total of $8,580 for the 52 unpatented claims. Annual claim maintenance fees are due before September 1st of each year.

Notice must be filed with and approved by the BLM, the USFS, and the SDDANR prior to undertaking any exploration activities. The notice describes the proposed exploration activities and any remedial reclamation deemed necessary. The various government agencies review the application to ensure there will be no deleterious impacts as a result of activity on the claims prior to granting any approvals for the proposed work. Access to the property is gained by traveling 1 mile southwest of Lead SD on Highway 85/ 14A to State Highway 473 and then traveling west approximately 3.2 miles to Wharf Mine Road and continuing generally northwest approximately 4.2 miles to the site of historic Preston gold camp.

Tertiary-aged gold mineralization in the Ragged Top area is hosted primarily in the Paha Sapa Limestone formation and has been mined from both vertical fissures called “Verticals” and from collapsed breccias.

Dakota Territory’s Ragged Top Property is located just northwest of the producing Wharf Mine (Coeur Mining) and approximately 3 miles southwest of the former Richmond Hill Mine (Barrick Gold). The Atlas Development portion of the property was the site of historic small scale gold operations and was explored with shallow drilling by Homestake Mining Company in the 1970’s and 1980’s. Historic resources on the property were included in State Mine Permit 416, which is still active. Dakota Territory believes that the Ragged Top Property is an excellent prospect for additional tertiary-aged limestone hosted gold mineralization and for tertiary-aged gold and silver replacement mineralization in the preferred Deadwood formation host that lies under the cover of the limestone that dominates the surface exposure.

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Poorman Anticline Property

The Poorman Anticline Property consists of 104 unpatented lode-mining claims, covering a total of approximately 1,461 acres in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 4 N, Range3E covering portions of Sections 5, 6, 7, 8, 9, 16, and 17, and Township 5 N, Range2E covering a portion of Section 36, and Township 5 N, Range3E covering portions of Sections 30 and 31.

Dakota Territory staked Poorman Anticline Property between February 2019 and August 2021 and maintains 100% ownership of the property. There is no known encumbrance of any kind and there are no known private surface rights owners within the bounds of the claims with all surface rights under the control of the US Forest Service or the Bureau of Land Management. Annual claim maintenance fees are $165 per claim, or a total of $17,160 for the 104 claims that comprise the Poorman Anticline Property. Annual claim maintenance fees are due before September 1st of each year.

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Access to the northern end of the property is gained by traveling southwest from the City of Lead on Highway 85/14A and turning onto the Kirk Road and traveling approximately 1.5 miles east. Alternately, the area can be accessed by traveling approximately 3.6 miles southwest of Lead on Highway 85/14A, turning on to County 205 south for 0.5 miles to Brownsville Road and traveling 0.8 miles east and turning north traveling approximately 2.3 miles on the Englewood Road.

The Poorman Anticline is the southwestern-most extension of the Homestake iron-formation host in the district. Gold mineralization was discovered underground on the 2600 and 4100 foot levels in the far western extents of the Homestake Mine in the 1950’s and 60’s with little known historic follow-up exploration in the Poorman Anticline closer to surface. Dakota Territory’s targeting in the Poorman Anticline is based on the presence of the Homestake iron-formation host and projected intersections with important shear fabric that is known to have conducted fluids necessary to the deposition of gold mineralization in the northern extents of the structural corridor.

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Maitland Property

The initial 37.8 mineral acres of the Maitland Property were acquired in April of 2017 through an Exploration and Mining Lease and Option to Purchase Property Agreement with Trucano Novelty Inc., of South Dakota. On October 26,2020, Dakota Territory acquired 2,112 mineral-acres from Homestake Mining Company of California, a wholly owned subsidiary of Barrick Gold Corporation. Pursuant to the terms of the definitive agreement, the Company paid consideration to Barrick comprised of $3.5 million cash and the issuance of 750,000 shares of Dakota Territory’s common stock. Additionally, Barrick retained a 2.5% net smelter returns royalty on the property. In August 2021, Dakota Territory purchased an additional 25.5

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acres to expand the Maitland Property to a total of 2,175 acres, all of which is located in the western portion of Lawrence County, South Dakota, USA within Black Hills Meridian, Township 5 N, Range 2 E, covering portions of Sections 12, 13, and 24, and Township 5 N, Range 3 E, covering portions of Sections 7, 8, 17, 18, 19 and 20.

The Maitland Property is an important component of Dakota Territory’s exploration strategy for the structural corridor that extends from the Homestake Gold Mine to Dakota Territory’s Blind Gold Property at the northern end of the District. The Maitland Property covers the down-plunge component of Homestake formation extending from the Blind Gold Property target at the north end, and Homestake Mining Company’s North Drift gold discovery of the late 1980’s to the south. In addition to Pre-Cambrian aged gold mineralization hosted within the Homestake iron formation, the property area holds several historic Tertiary age mineralization and historic mines hosted in the younger sedimentary and intrusive rocks.

Access to the Maitland Gold Property is gained by traveling 2 miles north of Lead on Highway 85/14A to Central City/Blacktail and then turning and traveling northwest approximately 1.7 miles on the Maitland Road. The property is proximal to the Company’s Homestake Paleoplacer Property and is contiguous to the Blind Gold and West Corridor Properties, as well as property Dakota Territory purchased from Deadbroke Mining Company near the historic Maitland Mine.

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South Lead / Whistler Gulch Property

The South Lead / Whistler Gulch Property was staked between June and September 2021 and is comprised of 594 unpatented claims covering a total of approximately 10,128 acres located in the western portion of Lawrence County, South Dakota, USA. More specifically the claims lie within the Black Hills Meridian, Township 4 N, Range 2 E, covering portions of Sections 2, 9, 10, 11, 13, 14, 15, 22, 23, 24, 25, 26 and 36, and Township 4 N, Range 3 E, covering portions of Sections 1, 2, 3, 13, 19, 20, 21, 22, 24, 27, 28, 29, 30, 31, 32, 33, and 34, and Township 4 N, Range 4 E, covering portions of Sections 18, 19 and 31, and Township 5 N, Range 3 E, covering portions of Sections 13, 14, 15, 22, 23, 24, 25, 26, 27, 34, 35 and 36.

The South Lead portion of the property is not contiguous but is generally located south of the City of Lead extending as a band approximately 9 miles across the southern end Homestake District from

Highway 85/14A at the west side to US Highway 385 on the east side. Multiple points of access to the property are gained from the paved State and Federal highway systems, as well as from numerous all-weather secondary paved and gravel roads maintained by Lawrence County. A network of BLM and Forest Service roads also cut the property. The Whistler Gulch section of the property is generally located immediately south of the City of Deadwood and extending south and east from Whistler Gulch. Access to the property is gained from the streets within the City of Deadwood, US Highway 385 along at the western property boundary, and from numerous all-weather gravel roads maintained by Lawrence County. A network of BLM and Forest Service roads also cut the property.

Dakota Territory maintains 100% ownership of the property. There are no known private surface rights owners within the bounds of the claims with all surface rights on the property under the control of the US Forest Service or BLM. Annual claim maintenance fees are $165 per claim, or a total of $98,010 for the 594 claims that comprise the Property. Annual claim maintenance fees are due before September 1st of each year.

Notice must be filed with and approved by the BLM, the USFS, and State regulatory agencies prior to undertaking any exploration activities. The notice describes the proposed exploration activities and any remedial reclamation deemed necessary. The various government agencies review the application to ensure there will be no deleterious impacts as a result of activity on the claims prior to granting any approvals for the proposed work.

The South Lead / Whistler Gulch Property has been subject to extensive historic prospect and mining activity, primarily related to Tertiary-aged gold mineralization in Deadwood formation, Tertiary-aged intrusives and the Pre Cambrian basement rocks. Dakota Territory believes the South Lead / Whistler Gulch Property also holds potential for Homestake style iron-formation hosted mineralization down plunge from the Homestake mine under cover of the younger rocks that dominate the surface.

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Barrick Option Property

Dakota Territory entered into a three-year option agreement on September 7, 2021 to acquire 4,261 acres of surface rights with attendant facilities and data held by Homestake Mining Company of California, a wholly owned subsidiary of Barrick Gold Corporation. In consideration for the Option, Dakota Territory made a cash payment of US$1.3 million and issued 1 million shares of common stock of the Company (“Shares”) to Barrick and will make annual Option payments of US$300,000 during the Option period. Dakota Territory may exercise the Option on or before September 7, 2024, by assuming all of the liabilities and bonds currently held by Homestake within the District. In addition, on exercise of the Option, Dakota Territory will issue Barrick 3 million Shares and grant a 2.5% NSR to Barrick with respect to any gold that may be recovered from the Grizzly Gulch property.

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The property is located in and around the City of Lead and lies within the Black Hills Meridian, Township 5 N, Range 3 E, covering portions of Sections 19, 20, 27, 28, 29, 30, 32, 33, and 34, and Township 4 N, Range3 E, covering portions of Sections 2, 3, 4, 9, 10, 11, 14, and 15.

Access to the property is gained from multiple public roads and highways including, streets within the City of Lead, paved Highway 85/14A near Central City, US Highway 385 at Pluma, and via Lawrence County maintained Grizzly Gulch, Kirk, and Yellow Creek roads.

The Barrick Option Property was previously a part of, or utilized in support of Homestake Mining Company’s historic gold mining operations at Lead. Subdivisions of the property include Sawpit Gulch, Open Cut and Grizzly Gulch areas. As the property was previously disturbed by mining, Dakota Territory believes that potential exists for the Company to repurpose the property and remaining infrastructure for future operations in the event that exploration is successful at Dakota Territory project areas that lie in close proximity. The Grizzly Gulch area of the property also holds potential to re-process tailings from milling operations at the Homestake Gold Mine.

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Richmond Hill Property

On October 14, 2021, Dakota Territory entered into an option agreement to acquire a 100% interest in the Richmond Hill Property in the Homestake District, South Dakota. Under the terms of the agreement, Dakota Territory has a three-year option to acquire 2,126 acres of surface and mineral rights with attendant

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facilities. Dakota Territory issued 400,000 Shares to Barrick and will make annual Option payments of $100,000 during the option period. Dakota Territory may exercise the Option on or before September 7, 2024, by assuming all of the liabilities and bonds associated with the Richmond Hill Property. In addition, on exercise of the option, Dakota Territory will issue Barrick an additional 400,000 shares and grant a 1% NSR to Barrick with respect to any gold that may be recovered from the Richmond Hill Property.

The property is located in the western portion of Lawrence County, South Dakota, USA. More specifically the property lies within the Black Hills Meridian, Township 5N, Range2E covering portions of Sections 9, 10, 11, 13. 14, 15, 16, 21, 22, 23, 24, 26, 27, and 34. The property is contiguous to Dakota Territory’s West Corridor and Blind Gold Properties and is located approximately 1/2 mile north of the producing Wharf Gold Mine (Coeur Mining). Access to the property is gained by traveling 1 mile southwest of Lead SD on Highway 85/14A to State Highway 473 and then traveling west approximately 3.2 miles to Wharf Mine Road and continuing west approximately 1.2 miles before turning and traveling 1 mile north on the Richmond Hill Road.

The Richmond Hill Property is an important component of Dakota Territory’s exploration strategy for the Homestake District. The property includes the past producing Richmond Hill mine and the mines of the Carbonate District. The Richmond Hill mine produced ore from Tertiary breccias dominantly hosted within Precambrian units that were processed as an open pit, heap leach operation. Tertiary hosted and replacement gold mineralization, as well as possible Precambrian iron formation hosted mineralization were also identified during exploration programs in the 1980’s and 1990’s.

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Internal Controls

Dakota Territory’s properties are all at an early stage of exploration, with no reserves, resources, or drill penetrations that could be construed as being a potentially economic discovery. Furthermore, Dakota Territory has not yet commenced exploration on its properties that involves drilling, sampling, or assaying, therefore internal controls relating to Quality Assurance and Quality Control (QA/QC) have not to date been necessary. However, prior to conducting exploration that involves drilling, sampling, assaying, and the reporting of results from those activities, Dakota Territory will implement sampling and analytical QA/QC protocols consistent with industry standards. These protocols include, but are not limited to, the following procedures:

All sampling will be conducted under the supervision of Dakota Territory’s project geologists and the chain of custody from the project to the sample preparation facility will be continuously monitored. A blank, certified reference material, or duplicate will be inserted approximately every tenth sample. The samples will be delivered to Bond Mineral Services and Engineering preparation facility in Central City, SD where they are readied for shipment to ALS Global’s certified laboratory in Reno, NV for crushing and pulverizing.

Pulps will be digested and analyzed for gold using fire assay fusion and an atomic absorption spectroscopy (AAS) finish on a 30-gram split.

Over limit gold assays will be determined using a fire assay fusion with a gravimetric finish on a 30-gram split. All other elements will be determined by four-acid digestion and ICP analysis.

Data verification of the analytical results will include a statistical analysis of the standards and blanks that must pass certain parameters for acceptance to insure accurate and verifiable results.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF DAKOTA TERRITORY RESOURCE CORP.

This management’s discussion and analysis should be read in conjunction with the financial statements for the fiscal years ended March 31, 2021 and 2020 and the condensed consolidated financial statements for the three and nine months ended December 31, 2021 of Dakota Territory Resource Corp. (“Dakota Territory”) and notes thereto as set forth herein. Readers are also urged to carefully review and consider the various disclosures made by Dakota Territory, which attempt to advise interested parties of the factors which affect Dakota Territory’s business, including without limitation, the disclosures made under “Risk Factors” in Dakota Territory’s Annual Report on Form 10-K for the year ended March 31, 2021. Dakota Territory’s audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles. On May 13, 2021, the Dakota Territory board approved a reverse stock split of Dakota Territory’s common stock at a ratio of 1-for-4. All share numbers and common stock prices presented give effect to the reverse split.

Overview

Dakota Territory’s goal is to create stockholder value through the acquisition, responsible exploration and future development of high caliber gold properties in the Homestake District of South Dakota. Management and the technical teams cumulatively have several hundred years of international mining and exploration experience and key personnel have more than 50 combined years in the Homestake District, mostly with the Homestake Mining Company, as well as other exploration companies that worked in the region. Dakota Territory believes this experience uniquely positions Dakota Territory and will allow it to leverage its direct experience and knowledge of past exploration and mining activities in the District with modern exploration and mining techniques and understanding to focus its programs and build upon dominance where the historic Homestake Mining Company left off in the 1990s.

The Homestake District has yielded approximately 44.6 million ounces of gold production with most of it coming from within a small area. The production ledges of the old mine define a cumulative surface projection area of much less than 3 square miles. Homestake Mining Company’s historic gold production and exploration in the District is overwhelmingly focused on the underground mine. Modern statistical studies and understanding of the distribution of large gold camps around the world identifies that large gold deposits generally occur in clusters. Dakota Territory believes the Homestake District is generally underexplored and has lacked the modern efforts required to search for gold deposits especially under the cover of younger sedimentary and igneous rocks that dominate the surface. The Homestake District is a safe low-cost jurisdiction with well-developed mining infrastructure and is a jurisdiction in which regulatory authorities have consistently demonstrated a willingness to work with responsible operators to permit well-planned compliant projects.

Since 2012, Dakota Territory has consistently pursued a strategy of expanding its portfolio of brownfields properties located exclusively within the Homestake District to build a dominant land position with the goal of consolidating the remaining mineral potential. Property acquisitions are focused and based on past exploration, the access to proprietary data sets Dakota Territory has assembled over the years, and new research that has been conducted on the gold systems that created the deposits in the Homestake District. Dakota Territory has not established that any of Dakota Territory’s projects or properties contain any proven or probably reserves under Subpart 1300 of Regulation S-K.

Dakota Territory believes the Homestake District is located in a safe, low-cost jurisdiction with well- developed infrastructure and is in a regulatory jurisdiction in which authorities have consistently demonstrated a willingness to work with responsible operators to permit well-planned compliant projects.

Planned Activities

Dakota Territory’s planned activities during fiscal 2022 are focused on advancing Dakota Territory’s Maitland, Blind Gold, City Creek and Tinton gold exploration properties and to continue to build on its overall property position in the Homestake District of South Dakota.

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in 2021, to enhance possible drill targets, as well as to screen targets on other brownfields areas of interest within the District. Several field sampling and mapping programs have been initiated and Dakota Territory continues to locate, evaluate and add to the historic information in its regional and project level data sets from the 145-year-old Homestake Mining Company files as well as from other sources.

Table: Fiscal Year 2022 Proposed Exploration Expenditures (millions)

General & administrative	$	3.4
Drilling, Field programs/Met Testing/Data Compilation	$	6.2
Property Acquisition	$	3.8
TOTAL	$	13.4

Since Dakota Territory’s projects are all exploration stage and do not, to date, generate revenues. Dakota Territory has not established that any of its properties or projects contain proven or probable reserves as defined under Subpart 1300 of Regulation S-K. Expenditure projections are subject to numerous contingencies and risk factors beyond Dakota Territory’s control, including exploration and development risks, competition from well-funded competitors, and Dakota Territory’s ability to manage growth. Dakota Territory cannot offer assurance that its expenses will either meet or exceed its projections.

As of December 31, 2021, Dakota Territory has a commitment to purchase an additional exploration property at an approximate cost of approximately $190,000 which is expected to close in the first half of 2022.

Liquidity and Capital Resources

Dakota Territory is an exploration-stage company and does not generate revenues. As such, Dakota Territory finances its operations and the acquisition and exploration of its mineral properties through the issuance of share capital, and Dakota Territory could be materially adversely affected if it is unable to raise capital because of market or other factors.

As of December 31, 2021, Dakota Territory had working capital of $46,191,920 and its accumulated deficit as of December 31, 2021, was $31,196,490. Dakota Territory had a net loss for the nine months ended December 31, 2021, of $22,653,706.

During the nine months ended December 31, 2021, Dakota Territory issued a total of 11,203,661 shares of common stock for net proceeds of $49,515,626.

During Dakota Territory’s fiscal year ending March 31, 2022, Dakota Territory plans to spend approximately $13.4 million. The timing of these expenditures is dependent upon a number of factors, including the availability of contractors. Dakota Territory has sufficient funds for funding its activities for the current year and for the 12 month period beyond Dakota Territory’s fiscal year-end.

Nine months ended December 31, 2021 and 2020

Cash flows used in operating activities

During the nine months ended December 31, 2021, and 2020, Dakota Territory’s cash flows used in operating activities were $5,715,288 and $1,616,447, respectively. Cash used in operations for the December 31, 2021, period increased year over year as Dakota Territory increased the amount of land staking and associated annual claim maintenance costs. In addition, Dakota Territory completed an airborne geophysical

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survey and engaged additional personnel to review and commence the compilation of historical geological data obtained through the Barrick option agreements. Dakota Territory also began preparation for drilling activities, which commenced in January of 2022.

Cash flows used in investing activities

During the nine months ended December 31, 2021, and 2020, cash flow used in investing activities were $6,753,649 and $3,771,801, respectively. In the period ended December 31, 2021, the cash used for investing activities consisted primarily of the acquisition of land. As Dakota Territory has increased the land package for mineral rights under control, it has increased land acquisition expenditures in fiscal 2022 compared to fiscal 2021.

Cash flows used in financing activities

During the nine months ended December 31, 2021, and 2020, cash flows from financing activities were $48,713,911 and $10,945,161, respectively. In the period ended December 31, 2021, Dakota Territory issued shares for proceeds of $50.3 million and made a repayment of related party notes for $801,715. Cash flows from investing in the period ended December 31, 2020, consisted primarily of Dakota Territory issuing shares for proceeds of $9.4 million, receiving proceeds from option exercises of $631,000 and proceeds from a note payable of $1.1 million.

Fiscal years ended March 31, 2021 and 2020

Cash flows used in operating activities

During the years ended March 31, 2021 and 2020, Dakota Territory’s cash flow used in operating activities were $2,439,245 and $451,082, respectively. Cash used in operations for the March 31, 2021 period increased year over year as Dakota Territory increased the amount of land claims and associated annual claim maintenance costs. In addition, Dakota Territory completed an airborne geophysical survey and engaged additional personnel to review and commence the compilation of historical geological data obtained through the Barrick option agreements.

Cash flows used in investing activities

During the years ended March 31, 2021 and 2020, cash flow used in investing activities were $4,689,266 and $nil, respectively. In the period ended March 31, 2021, the cash used for investing activities consisted primarily of the acquisition of land.

Cash flows used in financing activities

During the years ended March 31, 2021 and 2020, cash flow from financing activities were $17,375,026 and $444,917, respectively. In the period ended March 31, 2021, Dakota Territory issued shares to receive proceeds of $20.6 million, partially offset by a dividend to non-controlling interest shareholders of $4.3 million. In the period ended March 31, 2020, financing inflows were primarily due to a loan for Dakota Territory of $300,000.

Results of Operations

Three months ended December 31, 2021 and 2020

Revenue

Dakota Territory had no operating revenues for the three months ended December 31, 2021.

Exploration Costs

During the three months ended December 31, 2021, and 2020, Dakota Territory’s exploration costs were $2,058,521 and $94,071, respectively. The largest increase year over year related to $1,210,390 of share- based compensation expense in the three months ended December 31, 2021, (2020 — $0) as a result of

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higher share price driving a higher fair value for equity compensation being granted, as well as a one-time grant to employees and contractors of shares of common stock and Restricted Share Units related. Exploration work continued to ramp up, with higher payments of annual claim maintenance fees related to mineral properties from a larger land package, a regional geophysical survey and preparatory work for drilling, which commenced in January of 2022.

General and Administrative

Dakota Territory’s general and administrative expenses for the three months ended December 31, 2021 and 2020, were $3,391,952 and $158,364, respectively. The largest expenses were related to merger and related activities, including $1,827,808 of share-based compensation expense in the three months ended December 31, 2021 (2020 — $0), and legal, accounting and professional fees and investor relations accounting for $409,440 (2020 — $110,384). These costs are not expected to be incurred at such levels going forward.

Nine months ended December 31, 2021 and 2020

Revenue

Dakota Territory had no operating revenues for the nine months ended December 31, 2021. As a result of ongoing operating losses, Dakota Territory had an accumulated deficit of $31,196,490 as of December 31, 2021.

Exploration Costs

During the nine months ended December 31, 2021, Dakota Territory’s exploration costs were $6,117,247 (2020 — $576,260). Included in these costs were share-based compensation and payments of annual claim maintenance fees related to its mineral properties. The increase year over year related to $3,869,590 of share- based compensation expense in the nine months ended December 31, 2021 (2020 — $0) as a result of higher share price driving a higher fair value for equity compensation being granted, as well as a one-time grant to employees and contractors of shares of common stock and Restricted Share Units related and having additional funds as a result of the financing proceeds from Dakota Territory (the “Purchase Agreement”), which funded the airborne geophysical survey and review and compilation of historical geological data. Exploration work continued to ramp up, with higher payments of annual claim maintenance fees related to mineral properties from a larger land package, a regional geophysical survey and preparatory work for drilling, which commenced in January of 2022.

General and Administrative

Dakota Territory’s general and administrative expenses for the nine months ended December 31, 2021 and 2020 were $16,427,931 and $524,266, respectively. The largest expenses were related to merger and related activities, including $12,483,570 for share-based compensation in the nine months ended December 31, 2021 (2020 — $0) and $1,275,101 (2020 — $435,161) for legal, accounting and professional fees. These costs are not expected to be incurred at such levels going forward. Other general and administrative expenses necessary for operations accounted for $2,641,986 during the nine-month period ended December 31, 2021 (2020 — $89,105).

Dakota Territory had losses from operations for the nine months ended December 31, 2021 and 2020, totaling $22,545,178 and $1,100,526, respectively. Dakota Territory had total net losses for the nine months ended December 31, 2021 and 2020, of $22,653,706 and $2,415,630, respectively. Dakota Territory incurred interest expense for the nine months ended December 31, 2021 and 2020, respectively, in the amounts of $101 and $1,322,244 and recognized a loss on settlement of related party debt of $124,521 and $0, respectively.

Dakota Territory’s money market account generated interest income during the nine months ended December 31, 2021 and 2020, respectively, in the amounts of $16,094 and $2,140.

Off-Balance Sheet Arrangements

As at December 31, 2021 and 2020, Dakota Territory has off-balance sheet arrangements for annual payments in relation to the mineral leases as disclosed in Note 3 of Dakota Territory’s interim financial statements for the period ended December 31, 2021.

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Fiscal years ended March 31, 2021 and 2020

Revenue

Dakota Territory had no operating revenues during the fiscal years ended March 31, 2021 and 2020. As a result of ongoing operating losses, Dakota Territory had an accumulated deficit of approximately $8,543,000 as of March 31, 2021.

Exploration Costs

During the years ended March 31, 2021 and 2020, exploration costs totaled approximately $674,000 and $100,000, respectively. Included in these costs were for payments of annual claim maintenance fees related to Dakota Territory’s mineral properties. The increase year over year related to Dakota Territory having additional funds as a result of the Agreement, which funded the airborne geophysical survey and review and compilation of historical geological data.

General and Administrative

Dakota Territory’s general and administrative expenses for the fiscal years ended March 31, 2021 and March 31, 2020 were approximately $1,161,000 and $1,001,000, respectively. These expenditures were primarily for legal, accounting & professional fees, investor relations and other general and administrative expenses necessary for Dakota Territory’s operations.

Dakota Territory had losses from operations for the fiscal years ended March 31, 2021 and 2020 totaling approximately $1,835,000 and $1,101,000, respectively. Dakota Territory had a net loss for the fiscal years ended March 31, 2021 and 2020 of approximately $3,165,000 and $1,114,000, respectively. Dakota incurred interest expense from notes payable for the fiscal years ended March 31, 2021 and 2020, respectively, in the amounts of approximately $1,338,000 and $13,000. During the year ended March 31, 2021, and in connection with the Agreement with Dakota Territory, Dakota allocated $1,305,000 of the proceeds received from a $1,450,000 promissory note to a detachable option agreement providing Dakota Territory the right to acquire a total of 35,641,667 shares of Dakota Territory’s common stock. The amount allocated to the option agreement was recognized in equity and as a discount on the promissory note. Such discount was to be recognized as additional interest expense over the life of the note using the effective interest method. On October 15, 2020, and as a part of the first closing of Dakota Territory’s agreement with Dakota Territory, the promissory note to Dakota Territory was converted into 2,416,6667 shares of Dakota Territory’s common stock resulting in the full $1,305,000 discount being recognized as interest expense during the year ended March 31, 2021. In addition, approximately $16,000 of a discount recognized on related party notes was recognized as additional interest expense in the year ended March 31, 2021. Dakota Territory’s money market account generated approximately $7,200 of interest income during the year ended March 31, 2021.

Off-Balance Sheet Arrangements

For the fiscal years ended March 31, 2021 and 2020, Dakota Territory had off-balance sheet arrangements for annual payments in relation to the mineral leases as disclosed in Note 4 of Dakota Territory’s audited annual financial statements for the fiscal year ended March 31, 2021.

Critical Accounting Estimates

Management’s discussion and analysis of financial condition and results of operations is based on Dakota Territory’s financial statements, which have been prepared in accordance with US GAAP. Preparation of financial statements requires management to make assumptions, estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and the related disclosures of contingencies. Management bases its estimates on various assumptions and historical experience, which are believed to be reasonable; however, due to the inherent nature of estimates, actual results may differ significantly due to changed conditions or assumptions. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that Dakota Territory’s financial statements are fairly presented in accordance with US GAAP. However, because future events and their

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effects cannot be determined with certainty, actual results could differ from Dakota Territory’s assumptions and estimates, and such differences could be material. Management believes that the following critical accounting estimates and judgments have a significant impact on Dakota Territory’s financial statements: valuation of options granted to directors and officers using the Black-Scholes model and fair value of mineral properties. The accounting policies are described in greater detail in Note 2 to Dakota Territory’s audited annual financial statements for the fiscal year ended March 31, 2021.

Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

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MANAGEMENT

Directors

Below is a biography of the Company’s directors. Pursuant to the merger agreement, immediately prior to the closing of the transactions, the Company’s board of directors was reconstituted to mirror the board of directors of Dakota Territory.

Name			Age
Jonathan T. Awde			43
Gerald M. Aberle			62
Stephen T. O’Rourke			66
Robert Quartermain			66
Jennifer Grafton			45
Amy Koenig			48
Alex G. Morrison			58

Jonathan Awde

Mr. Awde has served as a director, President and Chief Executive Officer of the Company since November 15, 2017. Mr. Awde has been Chief Executive Officer and a director of Dakota Territory since March 2021. Mr. Awde is a co-founder, director and past Chief Executive and President of Gold Standard Ventures Corp. As Chief Executive Officer and President, from July 2010 through December 2020, Mr. Awde oversaw all corporate development, asset acquisition, joint ventures, capital raising and the procurement of capital for the development of Gold Standard Ventures Corp.’s assets. Mr. Awde spent the last 15 years raising financing for various junior resource companies, focusing on institutional accounts, high net worth and family offices, and he has raised over $600 million for public and private companies in the natural resources sector during this period. In September 2014, Mr. Awde was fined a total of $46,000 by the Quebec court for 11 counts of failing to file insider reports within the prescribed time period required under applicable securities legislation in respect of certain trades in securities of Northern Star Mining Corp. during the period from November 2008 to April 2010. The fine has been paid in full.

Gerald Aberle

Mr. Aberle graduated in 1980 from South Dakota School of Mines and Technology with a bachelor of science degree in mining engineering. Mr. Aberle has over 40 years of experience in the minerals industry, including 22 years with Homestake Mining Company at the Homestake gold mine in Lead, S.D. Mr. Aberle’s mining background includes extensive engineering, operations management and project management experience. Mr. Aberle has consulted in the mining, underground construction and minerals exploration business for clients including Homestake Mining Co., Barrick Gold Corp., the State of South Dakota and the University of Washington in connection with the planning and development of the National Science Foundation’s national deep underground science and engineering laboratory. Mr. Aberle has held numerous corporate management positions for public companies operating in the junior exploration business and has more than 24 years of private business experience in the United States, primarily in the land development and construction industries. From 2012 to July 2018, Mr. Aberle has served as the Chief Operating Officer of Dakota Territory. Mr. Aberle served as Chief Executive Officer of Dakota Territory from July 2018 to March 2021. Mr. Aberle has served as Chief Operating Officer of Dakota Territory since March 2021. The Company believes that Mr. Aberle’s extensive experience as an executive officer in the mining industry provides him with the necessary qualifications to serve as a director of the Company.

Stephen T. O’Rourke

Mr. O’Rourke served as President of Global Petroleum Exploration for BHP Billiton (NYSE:BHP) and was a member of the senior management team of the corporation. Other key roles at BHPB included vice President of Development Planning and Vice President of Appraisal and Petroleum Engineering. Prior to joining BHPB he held various senior technical and management roles for Shell Oil Company.

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Mr. O’Rourke has served as a founding partner of Strategic Management Partners LLC, a consulting firm based in Rapid City, SD specializing in energy, minerals & business development, since 2012. He has served as managing director for Heat Mining LLC, a geothermal technology development company, since 2011. He is currently a non-executive board member of RESPEC, an engineering consulting firm also based in Rapid City, SD and a non-executive director for TerraCOH, Inc., a CO2 geothermal energy company based in Minneapolis, MN. Mr. O’Rourke serves as a member of the South Dakota School of Mines & Technology (SDSM&T) Geological Engineering advisory board as well as board member of the university’s Center for Alumni Relations & Advancement. Mr. O’Rourke holds a BSc in Geological Engineering and an Honorary Doctorate of Public Service from SDSM&T and is a graduate of the Wharton School of Business Advanced Management Program. The Company believes that Mr. O’Rourke’s experience as an executive officer in a NYSE-listed public company, as well as his extensive exploration and project development industry experience, provides him with the necessary qualifications to serve as a director of the Company.

Robert Quartermain

Dr. Quartermain, P Geo, DSc has been a director of Dakota Territory since March 2021. Dr. Quartermain has 45 years experience in the resource industry. Dr. Quartermain is a precious metals entrepreneur and was most recently Executive Chairman of Pretium Resources Inc. which he founded in October 2010. Dr. Quartermain retired from Pretium on December 31, 2019. Prior to Pretium, Dr. Quartermain was the President and Chief Executive Officer of Silver Standard Resources Inc. (now SSR Mining Inc.) for 25 years starting in 1985. In addition to his focus on gold development opportunities, Dr. Quartermain has a number of wildlife and social justice philanthropic interests. The Company believes that Dr. Quartermain’s extensive experience in the resource industry and as a chief executive officer qualifies him to serve as a director of the Company.

Amy Koenig

Ms. Koenig currently serves as Vice President — Governance, Corporate Secretary and Deputy General Counsel for Black Hills Corporation (NYSE: BKH), an electric and gas utility company headquartered in Rapid City, South Dakota. Prior to joining Black Hills Corporation in 2013, Ms. Koenig spent ten years in private practice as a litigator with Gunderson, Palmer, Nelson & Ashmore, LLP. Before beginning her legal career, Ms. Koenig held various engineering roles of increasing responsibility in both the chemical and computer industries. Ms. Koenig also serves on the Board of Directors of the SD Mines Center for Alumni Relations and Advancement and on the Board of Directors of the Children’s Home Society of South Dakota. The Company believes that Ms. Koenig’s extensive corporate and legal experience qualifies her to serve as a director of the Company.

Jennifer Grafton

Ms. Grafton has served as Senior Vice President and Associate General Counsel of E2open Parent Holdings Inc. (NYSE: ETWO), a cloud-based, end-to-end supply chain management software company, since January 2021. Ms. Grafton was self-employed as a consultant from July 2019 to January 2021. Previous to E2open, Ms. Grafton worked at Westmoreland Coal Company (NASDAQ: WLB) from December 2008 to July 2019, most recently serving as Chief Legal Officer, Chief Administrative Officer and Secretary. Prior to Westmoreland, Ms. Grafton worked in the corporate group of various Denver-based and national law firms focusing her practice on securities and corporate governance. The Company believes that Ms. Grafton’s extensive corporate and legal experience qualifies her to serve as a director of the Company.

Alex G. Morrison

Mr. Morrison is a mining executive and chartered professional accountant with over 25 years of experience in the mining industry. Mr. Morrison has held board and senior executive positions with a number of mining companies, most recently serving as a director of Energy Fuels Corporation since August 2019, Gold Standard Ventures since September 2017, Gold Resource Corporation since March 2016, Taseko Mines Limited from 2011 to July 2020, Detour Gold Corporation from 2010 until December 2018. Mr. Morrison served as Vice President and Chief Financial Officer of Franco-Nevada Corporation from 2007 to 2010. From 2002 to 2007, Mr. Morrison held increasingly senior positions at Newmont Mining

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Corporation, including Vice President, Operations Services and Vice President, Information Technology. Prior to that, Mr. Morrison was Vice President and Chief Financial Officer of NovaGold Resources Inc., Vice President and Controller of Homestake Mining Company and held senior financial positions at Phelps Dodge Corporation and Stillwater Mining Company. Mr. Morrison began his career with PricewaterhouseCoopers LLP after obtaining his Bachelor of Arts in Business Administration from Trinity Western University. The Company believes that Mr. Morrison’s experience and skills developed as an executive officer and director for several publicly traded mining companies provide him with the appropriate background in matters related to finance and accounting, mining operations and risk assessment and make him well-qualified to serve as a director of the Company.

Director Independence

NYSE American listing standards require that a majority of the members of the Company board be “independent,” as such term is defined by the NYSE American listing standards. Based on such definition, the Company Board has determined that all directors other than Mr. Awde, who is an officer of the Company, Mr. Aberle, who is an officer of the Company, and Mr. O’Rourke, who has received a consulting fee from Dakota Territory, are independent.

Committees

The Company’s board committees are constituted in a manner that complies with the independence requirements under the NYSE listing standards and pursuant to Rule 10A-3 of the Exchange Act.

Executive Officers

The executive officers of the Company consist of Jonathan Awde, as President and Chief Executive Officer, Gerald Aberle as Chief Operating Officer and Shawn Campbell as Chief Financial Officer. Please see above for the biographies of Mr. Awde and Mr. Aberle. Mr. Campbell’s biography is below.

Shawn Campbell

Mr. Campbell, 41, has served as Chief Financial Officer of Dakota Territory since June 1, 2021 and brings more than 15 years of progressively senior experience in project and operations financial management obtained via professional practice, capital markets and industry experience. Mr. Campbell most recently served as the Chief Financial Officer of GT Gold Corp. from November 2019 to May 2021. Prior to GT Gold Corp., from July 2013 to November 2019, Mr. Campbell worked in various roles with Goldcorp Inc., including Head of Investor Relations and the Head of Finance for Canada and the U.S. He holds a Bachelor of Commerce Degree (Distinction) from the University of Victoria, and a Diploma in Accounting (DAP) from the University of British Columbia. He is a Chartered Professional Accountant (CPA, CA) and a CFA Charter Holder.

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EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth information regarding the named executive officers of the Company.

Name and Principal Position	Year		Salary ($)		Stock Awards ($)		Non-Equity Incentive Plan Compensation ($)		Total ($)
Jonathan Awde, Chief Executive Officer		2021		52,500		—		—		52,500
Gerald Aberle, Chief Operating Officer		2021		—		—		—		—
Shawn Campbell, Chief Financial Officer		2021		—		—		—		—

Narrative Disclosure to Summary Compensation Table

In the fiscal year ended March 31, 2021, the Company paid $52,500 to Jonathan Awde as compensation for his services as chief executive officer of the Company. Prior to the closing of the transactions, the Company did not pay compensation to Gerald Aberle or Shawn Campbell, each of whom become named executive officers upon the closing of the transactions. Following the closing of the transactions, the Company began paying Mr. Awde an annual salary of $285,000, Mr. Aberle an annual salary of $260,000 and Mr.Campbell an annual salary of C$250,000.

Outstanding Equity Awards at Fiscal Year-End

There were no outstanding equity awards as of March 31, 2021.

Director Compensation

Prior to the closing of the transactions, the Company did not pay compensation to its directors. Following the closing of the transactions, the Company began paying its non-employee directors an annual fee of $ 36,000, paid quarterly. Committee chairs are paid an additional $ 14,000 annually, and the Co-Chairs are paid an additional $ 36,000 annually. Neither Mr. Awde nor Mr. Aberle, each of whom also serves as a named executive officer, receives director fees. Dr. Quartermain also does not receive director fees and has instead requested that his fees be applied to the Company’s environmental, social and governance (ESG) budget.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Certain Relationships and Related Party Transactions of the Company

William Gehlen Employment Agreement

Effective on January 1, 2021, the Company entered into an employment agreement with William Gehlen, then a director of the Company, pursuant to which Mr. Gehlen serves as the Manager of Geology of the Company and receives a salary of C$190,000 per year. Mr. Gehlen remains employed by the Company following completion of the transactions.

Stockholders Support Agreement

In connection with the execution of the merger agreement, the Company and Dakota Territory entered into the Support Agreements with each of Alex Morrison, Gerald Aberle and Stephen O’Rourke. Pursuant to the Support Agreements, certain stockholders holding approximately 7.17% of the issued and outstanding shares of Dakota Territory’s common stock agreed to, among other things: (i) vote in favor of the transactions contemplated by the merger agreement, (ii) vote against and withhold consent with respect to any merger, purchase of all or substantially all of Dakota Territory’s assets or other similar business combination transaction other than those contemplated by the merger agreement, (iii) be bound by certain transfer restrictions with respect to the common stock of Dakota Territory held by the stockholder; and (iv) do all things reasonably necessary, proper or advisable to consummate the transactions contemplated by the merger agreement and not take any action that would reasonably be expected to prevent or delay the satisfaction of any of the conditions to those transactions, in each case, subject to the terms and conditions of the Support Agreements. Each Support Agreement terminated in its entirety upon the Effective Time (as defined in the merger agreement).

Private Placements

In early 2021, the Company’s available cash was materially reduced due to certain expenses. As a result, in March of 2021 the Company entered into agreements to complete a private placement with certain arm’s length investors, as well as Mr. Awde and Mr. Campbell, to invest under the same terms as under the Company’s private placements in 2020. On a post-reverse stock split basis, the terms of the private placement were to purchase units priced at $1.39 per unit, with each unit consisting of one share of the Company’s common stock and one-half of a warrant. Each whole warrant is exercisable into one share of the Company’s common stock at an exercise price of $2.08 for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026. The arm’s length parties subscribed for 180,377 units, Mr. Awde subscribed for 90,188 units and Mr. Campbell subscribed for 234,491 units, which were issued by the Company in May 2021.

Certain Relationships and Related Party Transactions of Dakota Territory

Jerikodie Inc. Consulting Agreement

Mr. Gerald Aberle is Dakota Territory’s former president, chief executive officer and is the current chief operating officer. He is also a director and significant stockholder of Dakota Territory and the owner of Jerikodie, Inc. (“Jerikodie”). Under a February 2012 agreement, Jerikodie earns a fixed consulting fee of $9,000 per month, plus approved expenses. In October 2020, Dakota Territory paid Jerikodie $200,000 of the approximate $729,500 owed to it for consulting fees and issued a note payable to Jerikodie for the remaining balance of approximately $529,500 bearing interest at 0.25% per year. On June 1, 2021, Dakota Territory and Jerikodie settled debt of $529,500 through the payment of $376,550 and the issuance of 45,563 shares of common stock. Upon settlement, Dakota Territory recognized all unamortized debt discount on the note totaling $37,876 as interest expense. The fair value of the consideration paid to settle the note exceeded the carrying amount of the note resulting in a loss on settlement of $54,169. During the three and nine months ended December 31, 2021, Dakota Territory paid Jerikodie $0 and $66,178, respectively (2020 — $27,000 and $81,000, respectively) for consulting fees. Effective April 15, 2021, Mr. Aberle transitioned from being a consultant to being an employee of Dakota Territory and the agreement with Jerikodie was terminated. Dakota Territory engaged a company controlled by a family member of Mr. Aberle, for the purpose of

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providing general labor and during the three and nine months ended December 31, 2021 and incurred $23,000 and $43,000 in costs, respectively (2020 — $0).

Gerald Aberle Loans

As of March 31, 2020, Dakota Territory owed Mr. Aberle, individually, $20,500 in unsecured loans. These unsecured loans bear interest of 3% per year and are due on demand or when past due. In July 2020, Mr. Aberle was paid in full for these unsecured loans and related accrued interest of $770.

Minera Teles Pires Inc. Consulting Agreement

Mr. Richard Bachman is Dakota Territory’s former chief geological officer. He is also a director and significant stockholder of Dakota Territory and the owner of Minera Teles Pires Inc. (“Minera Teles”). Under an October 2005 agreement that expired in March 2020, Minera Teles earned a $10,000 monthly consulting fee and received $1,500 per month for office rent and expenses. The consulting fee was divided between a $5,000 per month cash payment and a $5,000 per month deferred amount.

Richard Bachman Loans

Dakota Territory also owed Mr. Bachman, individually, $305,145 in unsecured loans. These unsecured loans bear interest at rates ranging from 3% to 4% per year and are due on demand. In June 2020, Dakota Territory repaid $40,145 of unsecured loans, plus accrued interest totaling $6,095. In October 2020, Dakota Territory paid Minera Teles $200,000 for amounts owed for prior services and combined the remaining amount owed of approximately $795,500 with amounts owed under the unsecured loans, including unpaid interest, into a new note in the amount of $1,055,310, bearing interest at 0.25% per year. A payment of $145,000 was made in December 2020. In July 2021, Dakota Territory and Mr. Bachman settled debt of $872,578 through the payment of $425,165 in cash and the issuance of 99,049 Dakota Territory Shares.

WCM Associates, LP Note

In October 2020, Dakota Territory issued a note payable to WCM Associates, LP, an entity controlled by Wm. Chris Mathers, Dakota Territory’s CFO, in the amount of $123,000, bearing interest at 0.25% per year, for amounts owed for consulting fees. The note required an initial payment in the amount of $86,500 due on January 1, 2021 and subsequent payments in the amount of $25,000 plus accrued interest, due on the last day of each quarter, beginning with the quarter ending March 2021, and continuing until the note is fully repaid. On February 4, 2021, the note to WCM Associates, LP was fully paid.

During the three and nine months ended December 31, 2021, Dakota Territory paid $0 and $6,000, respectively (2020 — $9,000 and $27,000, respectively) for consulting fees to WCM Associates, LP.

Blind Gold Property Royalty

Messrs. Aberle and Bachman own a 5% net smelter return royalty on the original eighty-four unpatented mining claims comprising the Blind Gold Property. During the nine months ended December 31, 2021, the Company extinguished the royalty by paying Messrs. Aberle and Bachman $25,000 each.

Stockholders Support Agreement

In connection with the execution of the merger agreement, the Company and Dakota Territory entered into the Support Agreements with each of Alex Morrison, Gerald Aberle and Stephen O’Rourke. Pursuant to the Support Agreements, certain stockholders holding approximately 7.17% of the issued and outstanding shares of Dakota Territory’s common stock agreed to, among other things: (i) vote in favor of the transactions contemplated by the merger agreement, (ii) vote against and withhold consent with respect to any merger, purchase of all or substantially all of Dakota Territory’s assets or other similar business combination transaction other than those contemplated by the merger agreement, (iii) be bound by certain transfer restrictions with respect to the common stock of Dakota Territory held by the stockholder; and (iv) do all things reasonably necessary, proper or advisable to consummate the transactions and not take any action that would reasonably be expected to prevent or delay the satisfaction of any of the conditions to those transactions, in each case, subject to the terms and conditions of the Support Agreements. Each Support Agreement terminated in its entirety upon the Effective Time (as defined in the merger agreement).

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table and accompanying footnotes set forth information with respect to the beneficial ownership of the Company’s common stock, as of May 4, 2022, by (1) each individual or entity known by the Company to beneficially own more than 5% of the Company’s outstanding common stock, (2) each of the Company’s named executive officers, (3) each of the Company’s directors and director nominees, and (4) all of the Company’s directors and executive officers as a group.

A person is a “beneficial owner” of a security if that person has or shares “voting power,” which includes the power to vote or to direct the voting of the security, or “investment power,” which includes the power to dispose of or to direct the disposition of the security or has the right to acquire such powers within 60 days.

To the Company’s knowledge, unless otherwise noted in the footnotes to the following table, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to their beneficially owned the Company’s common stock.

Percentage computations are based on 71,157,144 shares of the Company’s common stock outstanding as of May 4, 2022. Such number (a) takes into account (i) the Company’s reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 basis, which the Company completed on March 8, 2022, and (ii) the shares of common stock issued in the transactions., which closed on March 31, 2022, but (b) does not include shares of common stock underlying outstanding warrants or options or shares of common stock reserved for issuance under equity incentive plans.

Name and Address of Beneficial Owner(1)	Common Stock Beneficially Owned		Percent of Outstanding Shares Beneficially Owned
5% + Holders (excluding Directors and Executive Officers)
N/A		N/A		N/A
Directors and Executive Officers
Jonathan Awde		6,921,228(2)		9.73%
Gerald Aberle		4,353,896(3)		6.12%
Shawn Campbell		559,491(4)		*
Alex Morrison		336,563(5)		*
Stephen O’Rourke		1,033,333(6)		1.45%
Robert Quartermain		7,508,769(7)		10.85%
Jennifer Grafton		33,333(8)		*
Amy Koenig		33,333(8)		*
All Directors and Officers as a Group (8 persons)		20,779,946		29.20%

Less than 1%.

(1)

Except as otherwise noted, the business address of each of the named individuals in this table is c/o Dakota Gold Corp., 106 Glendale Drive, Suite A, Lead, South Dakota 57754.

(2)

Consists of 6,312,895 shares of common stock beneficially owned through an entity controlled by Mr. Awde and 258,333 vested options and 350,000 restricted share units vesting within 60 days.

(3)

Consists of 4,170,563 shares of common stock and 183,333 vested options.

(4)

Consists of 234,491 shares of common stock, 200,000 vested options and 125,000 restricted share units vesting within 60 days.

(5)

Consists of 214,063 shares of common stock and 122,500 vested options.

(6)

Consists of (i) 187,500 shares of common stock owned individually (ii) 500,000 shares beneficially owned through an entity controlled by Mr. O’Rourke, and (iii) 183,333 vested options.

(7)

Consists of 7,325,436 shares of common stock and 183,333 vested options.

(8)

Consists of 33,333 vested options.

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DESCRIPTION OF CAPITAL STOCK

The following description of material terms of the capital stock of the Company is a summary of certain terms, does not purport to be complete and is qualified in its entirety by reference to the Articles of Incorporation of the Company, as amended, and Amended and Restated Bylaws of the Company, which are filed as exhibits to the registration statement to which this prospectus relates and which are incorporated by reference into this prospectus.

Authorized Shares of Capital Stock

On March 8, 2022, the Company completed a reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 basis. As of May 4, 2022, following the reverse stock split, the Company’s authorized capital stock consists of 144,302,330 shares of common stock, par value $0.001 per share.

As of May 4, 2022, there were 71,157,144 shares of the Company’s common stock outstanding.

Common Stock

Voting Rights

The holders of the Company’s common stock are entitled to one vote per share with respect to all matters required by law to be submitted to stockholders. The holders of common stock have the sole right to vote. Election of directors requires the affirmative vote of a plurality of shares represented at a meeting, and other general stockholder action (other than an amendment to the Articles of Incorporation of the Company) requires the affirmative vote of a majority of shares represented at a meeting in which a quorum is represented.

Dividends

The holders of common stock are titled to receive dividends, if declared by the board of the Company, out of funds legally available.

Liquidation

In the event of liquidation, dissolution or winding up of the Company’s affairs, the holders of common stock are titled to share ratably in all assets remaining available for distribution to them after payment or provision for all liabilities.

Rights and Preferences

Holders of the Company’s common stock have no preemptive, conversion, subscription or other rights, and there are no redemption or sinking fund provisions applicable to the Company’s common stock. The holders of the Company’s common stock will have and possess all rights pertaining to the capital stock of the Company, subject to the preferences, qualifications, limitations, voting rights and restrictions with respect to any series of preferred stock of the Company that may be issued with any preference or priority over the Company’s common stock.

Fully Paid and Nonassessable

All of the outstanding shares of the Company’s common stock to be issued in connection with the transactions will be fully paid and nonassessable. The authorized but unissued shares of the Company’s common stock will be available for future issuance without stockholder approval. These additional shares may be used for a variety of corporate purposes, including future offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued shares of common stock may enable the Company board to issue shares of stock to persons friendly to existing management, which may deter or frustrate a takeover of the Company.

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Warrants

Below is a summary of warrants issued by the Company for the stated periods. Such discussion is presented after giving effect to the Company’s 1 for 35,641,667 / 49,398,602 reverse stock split, which was completed on March 8, 2022.

During the year ended March 31, 2021, the Company issued 5,632,508 shares of common stock at a weighted average price of $0.38 for proceeds of $2,126,387, and 14,722,397 units at a price of $1.39 for proceeds of $20,405,269 through various private placements. Each unit consists of one share of the Company’s common stock (14,722,397 total shares) and one-half of one warrant (7,363,193 total warrants). Each whole warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026. In connection with such private placements, the Company incurred expenses of $94,839.

During the nine months ended December 31, 2021, the Company issued 505,050 units at a price of $1.39 for proceeds of $700,000 through various private placements. Each unit consists of one share of the Company’s common stock (505,050 total shares) and one-half of one warrant (252,525 total warrants). Each whole warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026. In connection with the such private placements, the Company incurred aggregate expenses of $348,924.

A summary of changes in warrants outstanding is set forth below.

	Warrants		Weighted average exercise price
Balance, March 31, 2020		—		$	—
Issued		7,363,193			2.08
Balance, March 31, 2021		7,363,193		$	2.08
Issued		252,525			2.08
Balance, December 31, 2021		7,615,718		$	2.08

Private Placement Warrants

Certain of the Company’s outstanding warrants (as described above) are referred to elsewhere in this prospectus as the “Private Placement Warrants.” Each Private Placement Warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period commencing upon the effectiveness of the registration statement of which this prospectus forms a part and expiring on March 15, 2026. Prior to the Private Placement Warrants becoming exercisable, the Company will adopt a global warrant evidencing the Private Placement Warrants, pursuant to which Odyssey Trust Company, a trust company incorporated under the laws of Alberta, will serve as warrant agent in connection with the transfer, exchange and exercise of the Private Placement Warrants. The foregoing discussion does not purport to be complete and is qualified in its entirety by reference to the form of global warrant, substantially in the form attached as an exhibit to the registration statement to which this prospectus relates.

LEGAL MATTERS

Certain legal matters will be passed upon by Erwin Thompson Faillers, counsel to the Company.

EXPERTS

Dakota Gold Corp.

The consolidated financial statements of the Company as of March 31, 2021 and 2020, and for each of the two years in the period ended March 31, 2021, have been included herein in reliance upon the report of

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Ham, Langston & Brezina, L.L.P., an independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

Dakota Territory Resource Corp.

The consolidated financial statements of Dakota Territory as of March 31, 2021 and 2020, and for each of the two years in the period ended March 31, 2021, have been included herein in reliance upon the report of Ham, Langston & Brezina, L.L.P., an independent registered public accounting firm, appearing elsewhere herein (which report expresses an unqualified opinion on the financial statements and includes an explanatory paragraph referring to Dakota Territory’s ability to continue as a going concern), and upon the authority of said firm as experts in accounting and auditing.

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WHERE YOU CAN FIND MORE INFORMATION

The Company has filed with the SEC a registration statement on Form S-1, as amended, under the Securities Act with respect to the shares of common stock registered hereunder. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules filed with the registration statement. For further information about the Company and the common stock registered hereunder, you are referred to the registration statement and the exhibits filed with the registration statement. Statements contained in this prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the registration statement.

The Company is required to file periodic reports, proxy statements, and other information with the SEC pursuant to the Exchange Act. These reports, proxy statements, and other information are on the website of the SEC at www.sec.gov. The Company’s SEC filings are also available over the Internet on the Company’s corporate website at http://www.dakotagoldcorp.com.

Dakota Territory previously filed annual, quarterly and current reports and other information with the SEC, which filings are available on the SEC’s website.

By referring to the SEC’s website and the Company’s website, the Company does not incorporate such websites or its contents into this prospectus.

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INDEX TO FINANCIAL STATEMENTS

DAKOTA GOLD CORP.

	Condensed Consolidated Financial Statements (unaudited)
	Condensed Consolidated Interim Balance Sheets as of December 31, 2021 and March 31, 2021					F-3
	Condensed Consolidated Interim Statements of Operations for the Nine Months Ended December 31, 2021 and 2020					F-4
	Condensed Consolidated Interim Statements of Cash Flows for the Nine Months Ended December 31, 2021 and 2020					F-5
	Condensed Consolidated Interim Statements of Change in Stockholders’ Equity for the Nine Months Ended December 31, 2021 and 2020					F-6
	Notes to Condensed Consolidated Financial Statements					F-7
	Consolidated Financial Statements (audited)
	Report of Independent Registered Public Accounting Firm					F-18
	Consolidated Balance Sheets as of March 31, 2021 and 2020					F-20
	Consolidated Statements of Operations for the Years Ended March 31, 2021 and 2020					F-21
	Consolidated Statements of Cash Flows for the Years Ended March 31, 2021 and 2020					F-22
	Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended March 31, 2021 and 2020					F-23
	Notes to Consolidated Financial Statements					F-24

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JR RESOURCES CORP.

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED
DECEMBER 31, 2021 AND 2020

UNAUDITED

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	Page
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (UNAUDITED): CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS AS AT DECEMBER 31, 2021 AND MARCH 31, 2021		F-3
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED DECEMBER 31, 2021 AND 2020		F-4
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED DECEMBER 31, 2021 AND 2020		F-5
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE NINE MONTHS ENDED DECEMBER 31, 2021 AND 2020		F-6
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS		F-7

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JR RESOURCES CORP.

CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
(UNAUDITED — Expressed in United States dollars, except number of shares)

	December 31, 2021			March 31, 2021
ASSETS
Current assets
Cash		$	46,790,482		$	11,444,668
Receivable			22,884			13,317
Prepaid expenses and other current assets			345,274			371,580
Total current assets			47,158,640			11,829,565
Non-current assets
Mineral properties			72,892,131			57,931,794
Property and equipment, net			1,341,108			870,744
Total assets		$	121,391,879		$	70,632,103
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities		$	1,185,755		$	846,622
Accounts payable – related party			—			3,000
Current portion of notes payable – related party			—			906,768
Total current liabilities			1,185,755			1,756,390
Non-current liabilities
Non-current portion of notes payable – related party			—			473,325
Deferred tax liability			9,016,766			9,398,458
Total liabilities			10,202,521			11,628,173
Stockholders’ equity
Common stock, par value $0.001; 144,302,330 shares authorized, 35,641,079 and 35,136,029 shares issued and outstanding at December 31, 2021 and March 31, 2021, respectively			35,641			35,136
Additional paid-in capital			44,001,171			12,105,720
Retained earnings			11,806,295			25,679,461
Equity attributable to stockholders of the Company			55,843,107			37,820,317
Non-controlling interest			55,346,251			21,183,613
Total stockholders’ equity			111,189,358			59,003,930
Total liabilities and stockholders’ equity		$	121,391,879		$	70,632,103

The accompanying notes are an integral part of these condensed consolidated interim financial statements

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JR RESOURCES CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS
(UNAUDITED — Expressed in United States dollars, except number of shares)

	For the nine months ended December 31,
	2021			2020
Operating expenses
Consulting		$	507,404		$	213,557
Exploration costs			6,117,247			192,818
Office, travel and general			15,378,269			241,384
Professional fees			1,635,989			341,505
Loss from operations			(23,638,909)			(989,264)
Other income (expenses)
Foreign exchange gain (loss)			(49,543)			(1,168)
Loss on settlement of debt			(124,521)			—
Gain on derivative assets			—			27,087,667
Interest expense			(70,854)			—
Interest income			16,094			29,472
			(228,824)			27,115,971
Income (loss) before income tax			(23,867,733)			26,126,707
Deferred tax benefit			381,692			206,712
Net income (loss)		$	(23,486,041)		$	26,333,419
Net income (loss) attributable to:
Non-controlling interest			(9,612,875)			(112,591)
Stockholders of the Company			(13,873,166)			26,446,010
Net income (loss)		$	(23,486,041)		$	26,333,419
Weighted average number of basic and diluted common shares outstanding			35,561,255			21,315,035
Basic and diluted earnings (loss) per share attributable to the Company		$	(0.39)		$	1.24

The accompanying notes are an integral part of these condensed consolidated interim financial statements

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JR RESOURCES CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(UNAUDITED — Expressed in United States dollars)

	For the nine months ended December 31,
	2021			2020
Cash flows used in operating activities
Net income (loss)		$	(23,486,041)		$	26,333,419
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation			103,411			—
Interest income			—			(29,472)
Interest expense			124,521			—
Stock-based compensation expense			16,353,160			—
Gain on derivative assets			—			(27,087,667)
Deferred tax benefit			(381,692)			(206,712)
Changes in non-cash working capital items:
Receivable			(9,567)			(6,972)
Prepaid expenses and deposit			26,306			(84,696)
Accounts payable and accrued liabilities			339,881			(82,544)
Accounts payable – related party			(3,000)			(379,441)
Net cash used in operating activities			(6,933,021)			(1,544,085)
Cash flows used in investing activities
Note receivable			—			(1,150,000)
Loan receivable			—			(356,574)
Purchases of property and equipment			(573,775)			(19,921)
Purchases of mineral properties			(6,179,873)			(1,323,558)
Investment in DTRC			—			(9,000,000)
Cash acquired on acquisition			—			9,697,502
Net cash used in investing activities			(6,753,648)			(2,152,551)
Cash flows used in financing activities
Issuance of share capital, net of issuance costs			318,572			11,404,889
Proceeds from issuance of DTRC common stock			49,515,626			8,718,812
Proceeds from exercise of DTRC stock options and warrants			—			455,000
Net proceeds from (repaid to) related parties			(801,715)			(427,634)
Net cash provided by financing activities			49,032,483			20,151,067
Net increase in cash			35,345,814			16,454,431
Cash, beginning of period			11,444,668			141,768
Cash, end of period		$	46,790,482		$	16,596,199
Non-cash investing and financing activities
DTRC common stock issued for investment in mineral properties		$	8,780,464		$	—
DTRC common stock issued for payment of note payable		$	703,647		$	—

The accompanying notes are an integral part of these condensed consolidated interim financial statements

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JR RESOURCES CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(UNAUDITED — Expressed in United States dollars, except number of shares)

	Capital Stock					Additional Paid-in Capital			Share Subscriptions Receivable			Retained earnings (Accumulated Deficit)			Non-Controlling Interest			Total Stockholders’ Equity
	Number of Shares		Amount			Additional Paid-in Capital			Share Subscriptions Receivable			Retained earnings (Accumulated Deficit)			Non-Controlling Interest			Total Stockholders’ Equity
Balance, March 31, 2020		14,781,124		$	14,781		$	1,205,063		$	(126,753)		$	(331,453)		$	—		$	761,638
Common stock issued for cash, net of issuance costs		12,270,306			12,270			11,265,866			126,753			—			—			11,404,889
Cash received for unissued shares		—			—			8,718,812			—			—			—			8,718,812
Acquisition of DTRC common shares		—			—			(12,911,839)			—			—			25,444,979			12,533,140
Payment of cash dividend by DTRC		—						—			—			—			(4,357,246)			(4,357,246)
Change in non-controlling interest		—			—			(2,933,323)			—			—			2,933,323			—
DTRC common stock issued for investment in mineral property		—			—			—			—			—			1,320,000			1,320,000
Debt discount on notes payable – related party		—			—			—			—			—			86,026			86,026
DTRC common stock issued upon exercise of options		—			—			—			—			—			455,000			455,000
Net income		—			—			—			—			26,446,010			(112,591)			26,333,419
Balance, December 31, 2020		27,051,430		$	27,051		$	5,344,579		$	—		$	26,114,557		$	25,769,491		$	57,255,678
Balance, March 31, 2021		35,136,029		$	35,136		$	12,105,720		$	—		$	25,679,461		$	21,183,613		$	59,003,930
Common stock issued for cash, net of issuance costs		505,050			505			318,067			—			—			—			318,572
DTRC common stock issued		—			—			—			—			—			49,515,626			49,515,626
DTRC common stock issued for investment in mineral property		—			—			—			—			—			8,780,464			8,780,464
DTRC common stock issued upon conversion of debt		—			—			—			—			—			703,647			703,647
Stock-based compensation expense		—			—			—			—			—			16,353,160			16,353,160
Change in non-controlling interest		—			—			31,577,384			—			—			(31,577,384)			—
Net loss		—			—			—			—			(13,873,166)			(9,612,875)			(23,486,041)
Balance, December 31, 2021		35,641,079		$	35,641		$	44,001,171		$	—		$	11,806,295		$	55,346,251		$	111,189,358

The accompanying notes are an integral part of these condensed consolidated interim financial statements

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 1 — Organization and Nature of Business

JR Resources Corp. (the “Company” or “JR”) was incorporated on November 15, 2017 under the Business Corporations Act (British Columbia, Canada). The Company focuses its business efforts on the acquisition, exploration, and development of mineral properties in the United States of America (“U.S.”). On May 22, 2020, the Company completed the domestication process and changed the Company’s registration from the Province of British Columbia, Canada to the State of Nevada, U.S.

The Company’s mineral properties are at the exploration stage and are without a known body of commercial ore. The business of exploring for minerals involves a high degree of risk. Few properties that are explored are ultimately developed into producing mines. Major expenditures may be required to establish ore reserves, to develop metallurgical processes, to acquire construction and operating permits and to construct mining and processing facilities. The amounts shown as exploration and evaluation assets cost represent acquisition, holding and deferred exploration costs and do not necessarily represent present or future recoverable values. The recoverability of the amounts shown for exploration and evaluation assets cost is dependent upon the Company obtaining the necessary financing to complete the exploration and development of the properties, the discovery of economically recoverable reserves and future profitable operations or through sale of the assets.

These condensed consolidated interim financial statements have been prepared on the assumption that the Company and its subsidiaries will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As at December 31, 2021, the Company had not advanced its properties to commercial production and is not able to finance day-to-day activities through operations.

The Company’s continuation as a going concern is dependent upon the successful results from its exploration activities and its ability to attain profitable operations and generate funds therefrom and/or raise equity capital or borrowings sufficient to meet current and future obligations. The Company estimates it has sufficient working capital to continue operations for one year from the filing of this document.

Uncertainties and Economic Development

In March 2020, the World Health Organization designated the new coronavirus (“COVID-19”) as a global pandemic. Federal, state and local governments have mandated orders to slow the transmission of the virus, including but not limited to shelter-in-place orders, quarantines, restrictions on travel, and work restrictions that prohibit many employees from going to work. Uncertainty with respect to the economic effects of the pandemic has resulted in significant volatility in the financial markets. The restrictions put in place by federal, state and local governments could delay the Company’s exploratory programs on the Company’s mineral properties. Furthermore, the impact of the pandemic on the global economy could also negatively impact the availability and cost of future borrowings should the need arise. It is unknown how long the adverse conditions associated with the pandemic will last and what the complete financial effect will be to the Company. The Company continues to monitor the impact that the pandemic, including relief bills enacted in response thereto, may have on operations. Currently, the Company is unable to determine the impact that the pandemic will have on its financial condition, results of operations, or liquidity.

NOTE 2 — Significant Accounting Policies and Basis of Preparation

The following is a summary of significant accounting policies used in the preparation of these condensed consolidated interim financial statements:

Basis of Presentation

The accompanying unaudited condensed consolidated interim financial statements (“interim financial statements”) of JR have been prepared in accordance with accounting principles generally accepted in the

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

United States of America (“US GAAP”) and the rules of the Securities and Exchange Commission (“SEC”) for interim statements, and should be read in conjunction with the audited annual consolidated financial statements for the year ended March 31, 2021 (the “audited annual financial statements”). In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein.

The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the interim financial statements which would substantially duplicate the disclosures contained in the audited annual financial statements, have been omitted. Unless otherwise noted, there have been no material changes to the footnotes from those accompanying the audited annual financial statements.

Reverse stock split

On March 8, 2022, JR completed a reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 of a share basis, par value $0.001 per share (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each share of common stock issued and outstanding was automatically decreased to approximately 0.721512 of a share of issued and outstanding common stock, without any change in the par value per share. All information related to JR’s common stock, warrants and earnings or loss per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented. This adjustment impacts footnote 7. To effect the Reverse Stock Split, on March 8, 2022, the Company filed a certificate of change with the Nevada Secretary of State to decrease the number of authorized shares from 200,000,000 to 144,302,330 shares of common stock, par value of $0.001 per share.

Non-controlling Interest

The Company initially recognizes a non-controlling interest recognized in an asset acquisition on the date of acquisition at its fair value. Subsequent to initial recognition and measurement a non-controlling interest is allocated its share of net income or loss, and its respective share of each component of other comprehensive income of the consolidated subsidiary.

Merger Agreement

On May 14, 2021, the Company entered into a definitive merger agreement with Dakota Territory Resource Corp. (“DTRC”) (“Merger Agreement”). Pursuant to the Merger Agreement, the Company and DTRC have incorporated a new company (“NewCo”) that will acquire all of the outstanding securities of DTRC and of the Company in exchange for securities of NewCo (the “Merger”). Shareholders of the Company will receive a number of NewCo shares of common stock equal to their percentage shareholding in JR multiplied by the 35,641,667 DTRC shares that JR owns. Shareholders of DTRC other than JR will receive one share of common stock of NewCo for each share of common stock of DTRC.

In addition, at the closing of the Merger, (i) each outstanding option to purchase DTRC common stock, whether vested or unvested, will be assumed and converted into an option with respect to a number of shares of NewCo common stock in the manner set forth in the Merger Agreement, (ii) each outstanding warrant to purchase JR common stock, whether or not exercisable, will be assumed and converted into a warrant with respect to a number of shares of NewCo common stock in the manner set forth in the Merger Agreement, (iii) any outstanding awards of restricted stock units with respect to shares of DTRC common stock will be assumed and converted into the right to receive an award of restricted stock units representing a

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

right to receive a number of shares of NewCo common stock in the manner set forth in the Merger Agreement, and (iv) NewCo will change its name to “Dakota Gold Corp.”

The completion of the Merger is subject to customary closing conditions for a transaction of this nature, including securities law compliance, the approval of JR stockholders and the approval of DTRC stockholders. In addition, in connection with the Merger, the Company and DTRC intend to cause NewCo to prepare and file a registration statement on Form S-4 with the U.S. Securities and Exchange Commission (the “SEC”).

On April 30, 2021, DTRC incorporated Dakota Gold Services (Canada) Corp. (“Dakota Canada”) under the British Columbia Business Corporations Act. These interim financial statements consolidate Dakota Canada, a wholly-owned subsidiary.

On September 10, 2021, the Company amended the closing mechanics in respect to the Merger with DTRC without any changes to the economic considerations of the JR shareholders and DTRC shareholders. Pursuant to the amended agreement:

•

DTRC shareholders will receive one share of JR Resources (which will be renamed Dakota Gold Corp. prior to closing) for each share of DTRC;

•

JR shareholders will continue to hold shares of JR (which will be renamed Dakota Gold Corp. prior to closing); and

•

On March 8, 2022, prior to the closing of the Merger, JR completed a reverse share split such that the total number of JR shares was proportionately reduced to 35,641,667 JR shares.

Recent Accounting Pronouncements

Pronouncements between December 31, 2021 and the date of these interim financial statements were available to be issued are not expected to have a significant impact on the Company’s operations, financial position, or cash flow, nor does the Company expect the adoption of recently issued, but not yet effective, accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flows.

NOTE 3 — Note Receivable

In February 2020, the Company advanced $300,000 to DTRC. The note bore interest at 3.0% per year and was due on May 5, 2021. In May 2020, the Company and DTRC entered into an amended and restated promissory note in the amount of $1,450,000, which included the February 2020 $300,000 advance and an additional $1,150,000 that was advanced in May 2020. The amended and restated unsecured note bore interest at 0.25% per year, compounded annually, and matures on December 31, 2021. At maturity, the principal amount of the note, together with any accrued but unpaid interest, will be due and payable in cash, provided that, if and to the extent that DTRC does not pay this note in cash on the maturity date, then the Company will be required to exercise, and will be deemed to have exercised, its right to convert such unpaid portion of the note into shares of DTRC common stock. The conversion price was $0.60 per share through December 31, 2020 and, thereafter, the lesser of $0.60 per share and the volume weighted average price of DTRC common stock for the five consecutive trading days immediately preceding the date of such conversion (with a floor of $0.40 per share). The note has customary event of default provisions and, upon an event of default, the Company will be required to convert the unpaid portion of the note into the shares of DTRC common stock, if not paid in cash by DTRC.

In connection with the promissory note agreement with DTRC, the Company was granted an option by DTRC to purchase up to 35,641,667 shares of common stock at $0.60 per share in one or more closings

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 3 — Note Receivable (continued)

on or prior to October 15, 2020. The convertible feature of the amended and restated promissory note was determined to be a derivative asset. At issuance date, the Company determined the fair value of the convertible feature was $1,727,655. During the nine months ended December 31, 2021, the Company recorded a gain on derivative assets of $nil (2020 — $1,836,667, respectively).

In October 2020, the Company converted the principal amount of $1,450,000 into 2,416,667 DTRC common shares. The convertible feature was revalued to $1,836,667 prior to conversion. The Company recorded a gain on derivative assets of $1,836,667 for the year ended March 31, 2021.

In January 2021, the Company advanced a further $300,000 to DTRC, on an unsecured basis. On the occurrence of the final closing of DRTC acquisition (see Note 4), the unpaid principal of the loan was applied to the consideration.

NOTE 4 — Acquisition

In May 2020, the Company entered into an agreement with DTRC (the “Agreement”) whereby the Company loaned an additional $1,150,000 to DTRC (see Note 3) and DTRC granted JR the right to purchase up to 35,641,667 shares of common stock of DTRC at $0.60 per share (approximately 64% on a fully diluted basis) in one or more closings on or prior to October 15, 2020. The purchase right was determined to be a derivative asset. At issuance date, the Company determined the fair value of the purchase right was $16,351,772 using a Black Scholes valuation model. The weighted-average assumptions used to calculate the grant date fair value were as follows: (i) risk-free interest rate of 0.17%, (ii) estimated volatility of 223%, (ii) dividend yield of 0%, and (iv) expected life of 0.39 years. The fair value of the purchase right was revalued at each reporting period end with the gain or loss on derivative asset being recorded in the statement of operation. For the year ended March 31, 2021, the Company recognized a gain on derivative assets of $25,251,000 related to the purchase rights. During the nine months ended December 31, 2021, the Company recorded a gain on derivative assets of $nil (2020 — $25,251,000).

Upon execution of the Agreement, the Company and DTRC entered into an amended and restated promissory note in the amount of $1,450,000, of which $300,000 was advanced in February 2020 and $1,150,000 was advanced in May 2020 as noted above.

In October 2020, the Company and DTRC effected the first closing under the Agreement whereby JR purchased 17,416,667 common shares of DTRC for aggregate consideration of $10,450,000, including $9,000,000 in cash and $1,450,000 upon conversion of the principal amount of the May 2020 promissory note. The convertible feature of the promissory note exercised on October 15, 2020 was fair valued at $1,836,667 using a Black Scholes valuation model. However, given there was no term remaining on the convertible feature of the promissory note the fair value was equal to the intrinsic value at October 15, 2020.

The purchase right derivative assets that were exercised on October 15, 2020 were fair valued at $12,339,161 using a Black Scholes valuation model. However, given there was no term remaining on the purchase right the fair value was equal to the intrinsic value at October 15, 2020. The purchase right was revalued to $25,251,000 prior to exercise using a Black Scholes valuation model. For the year ended March 31, 2021, the Company recognized a gain on derivative assets of $25,251,000 related to the purchase right.

In addition, the Company and DTRC entered into amending agreements on October 15, 2020 and February 15, 2021 whereby (i) it was agreed to extend the balance of the May 2020 purchase right until March 17, 2021, and would allow JR the option to purchase up to an additional 18,225,000 shares of common stock for up to an additional $10,935,000, and (ii) DTRC created two director vacancies and agreed to allow for two JR nominees to be appointed, of which a nominee was appointed as a director to fill one vacancy on October 15, 2020.

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 4 — Acquisition (continued)

Immediately after the first closing, the Company owned 49.42% of DTRC common shares outstanding and had the right to purchase a further 18,225,000 DTRC common shares. In addition, the Company substantially controlled the operational and financial decisions of DTRC through a contractual agreement related to the use of the investment proceeds. Therefore, the Company determined that the acquisition of control of DTRC took place on October 15, 2020. The acquisition of DTRC has been treated as an acquisition of mineral properties.

The total consideration for the acquisition of the assets and liabilities of DTRC assumed on acquisition were as follows:

Consideration:
Conversion of promissory note	$	1,450,000
Value of convertible feature of promissory note		1,836,667
Cash investment		9,000,000
Value of purchase right		12,339,161
Transaction costs		231,043
	$	24,856,871
Allocated as follows:
Cash and cash equivalents	$	9,697,502
Prepaid expenses		14,403
Mineral properties		53,035,706
Property and equipment		8,801
Accounts payable and accrued liabilities		(479,794)
Accounts payable – related party		(1,770,234)
Notes payable – related party		(392,652)
Deferred tax liability		(9,811,882)
Non-controlling interest		(25,444,979)
	$	24,856,871

The consideration paid for DTRC has been allocated to the individual assets acquired and liabilities assumed based on their relative fair values. The carrying value of cash and cash equivalents, prepaid expenses, property and equipment, accounts payable and accrued liabilities, accounts payable — related party, notes payable — related party approximated fair value at acquisition. The mineral properties were fair valued using a market-based approach considering comparable market transactions and the non-controlling interest has been recognized at fair value.

The consideration paid less the net assets of DTRC have been adjusted based on the percentage of shares held by the Company and the non-controlling interest and added to the mineral properties to reflect the fair value of the Black Hills Project (See Note 5). As a result of the acquisition, the Company recorded a deferred tax liability of $9,811,882.

In March 2021, the Company and DTRC effected the second and final closing under the Agreement, as amended, whereby JR purchased 18,225,000 common shares of DTRC for an aggregate consideration of $10,935,000, $10,635,000 in cash and $300,000 upon conversion of the principal amount of a promissory note issued in January 2021. The Company’s interest in DTRC increased from 49.42% on the first closing to

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 4 — Acquisition (continued)
63.42% and the Company maintained control of DTRC.

NOTE 5 — Mineral Properties

Black Hills Project

On September 26, 2012, the Company was re-organized with North Homestake Mining Company and acquired the Blind Gold Property located in the Homestake District of South Dakota. In 2018 and 2019, the Company acquired additional acreage associated with the Company’s City Creek Property and the

Tinton Gold Camp. In 2020 and 2021, the Company increased the size of the Company’s Blind Gold Property, the Tinton Property, the Poorman Anticline Property, the Ragged Top Gold Camp, the West Corridor Property, the City Creek Property and added the South Lead/Whistler Gulch Property through both acquisitions and claim staking.

On October 26, 2020, the Company completed the purchase of the Maitland Gold Property from Homestake Mining Company of California (“HMCC”), a wholly owned subsidiary of Barrick Gold Corporation (“Barrick”). At closing, the Company paid Barrick $3.5 million cash and issued 750,000 shares of its common stock valued at $1.76 per share, for total consideration of $4.82 million. Additionally, Barrick retained a 2.5% net smelter returns royalty on the property. The 2,112 mineral-acre Maitland acquisition is an important component of the Company’s exploration and development strategy for the structural corridor that extends from the Homestake Gold Mine to the Company’s Blind Gold Property at the northern end of the Homestake District.

On September 7, 2021, the Company entered into an option agreement to acquire surface rights and certain facilities in the Homestake District, South Dakota from HMCC. The agreement provides for exclusive access to three extensive historic data sets which chronicle its 145-year exploration and mining history throughout South Dakota. Under the terms of the agreement, the Company has a three-year option to acquire 4,261 acres of surface rights with attendant facilities and data held by HMCC. In consideration for the option, the Company made a cash payment of $1.3 million and issued 1 million shares of common stock to Barrick and will make annual option payments of $300,000 during the option period. The Company may exercise the option on or before September 7, 2024, by assuming all of the liabilities and bonds currently held by HMCC in the Homestake District. In addition, on exercise of the option, Dakota Territory will issue Barrick 3 million shares and grant a 2.5% NSR to Barrick with respect to any gold that may be recovered from the Grizzly Gulch property.

On October 14, 2021, the Company entered into an option agreement to acquire the Richmond Hill Property in the Homestake District, South Dakota from LAC Minerals (USA) LLC and HMCC. Under the terms of the agreement, Dakota Territory has a three-year option to acquire 2,126 acres of surface and mineral rights with attendant facilities. The Company issued 400,000 shares to Barrick and will make annual option payments of $100,000 during the option period. The Company may exercise the option on or before September 7, 2024, by assuming all of the liabilities and bonds associated with the Richmond Hill Property. In addition, on exercise of the option, the Company will issue Barrick an additional 400,000 shares and grant a 1% NSR to Barrick with respect to any gold that may be recovered from the Richmond Hill Property.

In total, the Company currently holds eleven brownfield project areas in the District comprised of 1,905 unpatented mining claims (32,256 unpatented acres), the Homestake Option Area (4,261 patented acres), the Richmond Hill Option Area (2,126 patented acres) and additional lands and mineral rights throughout the District (3,201 patented acres, for a combination of surface and mineral lease rights covering

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 5 — Mineral Properties (continued)

a total of 41,844 acres. The Company has not established that any of its projects or properties contain any proven or probable reserves under SEC S-K 1300.

As at December 31, 2021 and March 31, 2021, the Company’s mineral properties totaled $72,892,131 and $57,931,794, respectively. As at December 31, 2021, the Company is in the exploration stage and has not commenced amortization of its properties.

NOTE 6 — Property and Equipment

As at December 31, 2021 and March 31, 2021, the Company’s property and equipment consists of the following:

	Estimated Useful Life (Years)	December 31, 2021			March 31, 2021
Land			$	70,000		$	70,000
Building	39			630,798			503,711
Furniture and equipment	3 – 5			621,862			330,125
Vehicles	5			154,952			—
				1,477,612			903,836
Less accumulated depreciation				(136,503)			(33,092)
Property and equipment, net			$	1,341,109		$	870,744

For the nine months ended December 31, 2021, depreciation expense was $103,411 (2020 — $868).

NOTE 7 — Share Capital

Authorized Share Capital

The Company’s authorized capital stock consists of 144,302,330 shares of common stock, with a par value of $0.001 per share.

Issued Share Capital

During the year ended March 31, 2021, the Company issued 5,362,508 common shares at a weighted average price of $0.38 for proceeds of $2,126,387 and 14,722,397 units at a price of $1.39 for proceeds of $20,405,269 through various private placements. Each unit consists of one common share of the Company and one-half of a warrant. Each whole warrant is exercisable into one common share of the Company at an exercise price of $2.08 for a period of 5 years. In connection with the private placement, the Company incurred expenses of $94,839.

During the nine months ended December 31, 2021, the Company issued 505,050 units at a price of $1.39 for proceeds of $700,000 through various private placements. Each unit consists of one common share of the Company and one-half of a share purchase warrant. Each whole warrant is exercisable into one common share of the Company at an exercise price of $2.08 for a period of 5 years. In connection with the private placement, the Company incurred expenses of $348,924.

Share Purchase Warrants

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 7 — Share Capital (continued)

from Equity, provides that these warrants are classified as equity. The fair value of these warrants was determined using the Black-Scholes Merton valuation model.

During the nine months ended December 31, 2021, in connection with various private placements, the Company issued 252,525 warrants with an exercise price of $2.08 per warrant. ASC 480, Distinguishing Liabilities from Equity, requires that these warrants are classified as equity. The fair value of these warrants was determined using the Black-Scholes Merton valuation model.

Number of warrants	Exercise price			Remaining life (years)		Expiry date
3,318,900		$	2.08		1.04	October 13, 2022
184,902		$	2.08		1.38	February 15, 2023
3,859,351		$	2.08		1.45	March 15, 2023
90,187		$	2.08		1.60	May 6, 2023
117,244		$	2.08		1.62	May 15, 2023
45,094		$	2.08		1.66	May 30, 2023
7,615,718

A summary of changes of warrants outstanding is as follows:

	Warrants		Weighted average exercise price
Balance, March 31, 2020		—		$	—
Issued		7,363,193			2.08
Balance, March 31, 2021		7,363,193		$	2.08
Issued		252,525			2.08
Balance, December 31, 2021		7,615,718		$	2.08

All of the common stock, warrants, units and per share amounts of JR in these financial statements and notes thereto have been adjusted for an approximately 0.721512-for-1 reverse stock split which took effect on March 8, 2022.

Stock Options

During the and nine months ended December 31, 2021, DTRC granted a total of 2,571,250 stock options with a weighted average exercise price of $4.46, exercisable for up to five years. The Company recognized stock-based compensation related to issuance of stock options totaling $6,025,440 and $nil during the nine months ended December 31, 2021 and 2020, respectively, of which $1,574,372 being allocated to exploration costs and $4,451,068 and being allocated to administrative expenses. During the nine months ended December 31, 2021, the Company estimated the fair value of each stock option to have a weighted average grant date fair value of $2.90 per share on the date of grant using a Black Scholes valuation model. The weighted- average assumptions used to calculate the grant date fair value were as follows: exercise price of $4.77, risk-free interest rate ranging from 0.39% — 1.28%, estimated volatility between 82.61% and 95.82%, dividend yield of 0%, and expected life of 4.08 to 5 years. As at December 31, 2021 the unrecognized compensation cost related to unvested options was $3,608,802, which will be expensed through December 2023. The weighted average life remaining for the stock options is 4.37 years.

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 7 — Share Capital (continued)

Restricted Stock Units

During the nine months ended December 31, 2021 DTRC issued 1,175,000 restricted stock units (“RSU’s”) with a grant date fair value of $4.95 per share to certain directors, officers, employees and consultants vesting on June 4, 2022. The share-based compensation expense for the RSU’s will be amortized monthly and allocated to exploration costs and general and administrative expenses. For the nine months ended December 31, 2021, $899,410 and $2,207,158 were allocated to exploration costs and general and administrative expenses, respectively. As at December 31, 2021 the unrecognized compensation cost related to unvested RSUs was $2,547,183, which will be expensed through June 2022.

Bonus Shares Issued by DTRC

During the nine months ended December 31, 2021, DTRC issued 1,450,000 shares of common stock valued at $7,177,500 as bonus shares to directors, employees and consultants of DTRC. For the nine months ending December 31, 2021, the share-based compensation expense for the bonus shares was allocated as $1,361,250 to exploration costs and $5,816,250 to general and administrative expenses.

NOTE 8 — Related Party Transactions

The Company engages in related party transactions that involve its officers and directors and/or companies controlled by the officers and directors. Following is an analysis of related party transactions: Mr. Gerald Aberle is the Company’s former President, Chief Executive Officer and is currently Chief Operating Officer of the Company. He is also a director and significant shareholder of the Company and the owner of Jerikodie Inc. (“Jerikodie”). Under a February 2012 agreement, Jerikodie earned a fixed consulting fee of $9,000 per month, plus approved expenses. In October 2020, the Company paid Jerikodie $200,000 of the approximate $729,500 owed to it for consulting fees and issued a note payable to Jerikodie for the remaining balance of $529,500 bearing interest at 0.25% per year. On June 1, 2021, the Company and Jerikodie settled debt of $529,544 through the payment of $376,550 and the issuance of 45,563 shares of common stock. The fair value of the consideration paid to settle the note exceeded the carrying amount of the note, resulting in a loss on settlement of $92,045. During the nine months ended December 31, 2021, the Company paid Jerikodie $66,178 (2020 — $81,000) for consulting fees, in addition to $25,000 in the nine months ended December 31, 2021, for the extinguishment of a net smelter royalty disclosed below. Effective April 15, 2021, the agreement with Jerikodie was terminated. The Company engaged a Company controlled by a family member of Mr. Aberle, for the purpose of providing general labor and during the nine months ended December 31, 2021, incurred approximately $43,000 in costs, respectively (2020 — $0).

Mr. Richard Bachman was the Company’s former Chief Geological Officer. He is also a significant shareholder of the Company and the owner of Minera Teles Pires Inc. (“Minera Teles”). Under an October 2005 agreement that expired in March 2020, Minera Teles earned a $10,000 monthly consulting fee and received $1,500 per month for office rent and expenses. The consulting fee was divided between a $5,000 per month cash payment and a $5,000 per month deferred amount. The Company also owed Mr. Bachman, individually, $305,145 in unsecured loans. These unsecured loans bore interest rates ranging from 3% to 4% per year and were due on demand. In June 2020, the Company repaid $40,145 of unsecured loans, plus accrued interest totaling $6,095. In October 2020, the Company paid Minera Teles $200,000 for amounts owed for prior services and combined the remaining amount owed of approximately $795,500 with amounts owed under the unsecured loans, including unpaid interest, into a new note in the amount of $1,055,310, bearing interest at 0.25% per year. A payment of $145,000 was made in December 2020. In July 2021, the Company and Mr. Bachman settled debt of $872,578 through the payment of $425,165 in cash and the issuance of 99,049 shares of common stock. The fair value of the consideration paid to settle the note exceeded the carrying amount of the note, resulting in a loss on settlement of $32,476.

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JR RESOURCES CORP.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR
THE NINE MONTHS ENDED DECEMBER 31, 2021 and 2020
(UNAUDITED — Expressed in United States dollars)

NOTE 8 — Related Party Transactions (continued)

In connection with the notes payable issued in 2020, as discussed above, the Company determined that the 0.25% contractual rate represented a below-market interest rate. Interest was imputed on the notes payable at 5.00% interest resulting in a discount at issuance of $86,024. During the three months ended December 31, 2020, the Company recognized amortization of the debt discount of $10,644 in interest expense, with the remaining unamortized discount to be recognized into interest expense over the remaining life of the notes using the effective interest method. The notes payable were extinguished in July 2021.

During the nine months ended December 31, 2021, the Company incurred $6,000 (2020 — $27,000) for consulting fees to WCM Associates, LP, an entity controlled by the Company’s former CFO.

Messrs. Aberle and Bachman owned a 5% net smelter return royalty on the original 84 unpatented mining claims that comprised the Blind Gold Property. In August 2021, the Company extinguished the royalty by paying Messrs. Aberle and Bachman $25,000 each.

In March 2021, Jonathan Awde was appointed Chief Executive Officer and Gerald Aberle resigned as Chief Executive Officer and was appointed Chief Operating Officer. Mr. Awde is also a director and significant shareholder of the Company.

NOTE 9 — Non-Controlling Interest

Non-controlling interest represents the portion of net assets in consolidated entities that are not owned by the Company. The following table presents the non-controlling interest balances reported in stockholders’ equity in the consolidated balance sheets as at December 31, 2021 and March 31, 2021:

Balance, March 31, 2020	$	—
Acquisition of DTRC		25,444,979
Payment of cash dividend by DTRC		(4,357,246)
Change in non-controlling interest		(1,396,034)
DTRC common stock issued for investment in mineral property		1,320,000
Stock-based compensation expense		121,385
Debt discount on notes payable – related party		86,026
DTRC common stock issued upon exercise of options		455,000
Net loss attributable to non-controlling interest		(490,497)
Balance, March 31, 2021	$	21,183,613
DTRC common stock issued		49,515,626
DTRC common stock issued for investment in mineral property		8,780,464
DTRC common stock issued upon conversion of debt		703,647
Stock-based compensation expense		16,353,160
Change in non-controlling interest		(31,577,384)
Net loss attributable to non-controlling interest		(9,612,875)
Balance, December 31, 2021	$	55,346,251

In October 2020, the Company acquired 49.42% of the DTRC common shares outstanding. In March 2021, the Company and DTRC effected the second and final closing whereby the Company increased its interest in DTRC from 49.42% to 63.42%. As at March 31, 2021, there were no further changes to the Company’s ownership of DTRC.

During the nine months ended December 31, 2021, the Company’s interest in DTRC decreased from 63.42% to 50.32%.

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JR Resources Corp.
And Subsidiaries

CONSOLIDATED FINANCIAL STATEMENTS WITH REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

AS OF AND FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

JR RESOURCES CORP. AND SUBSIDIARIES

TABLE OF CONTENTS

	Page
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		F-18
CONSOLIDATED FINANCIAL STATEMENTS:
CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2021 AND 2020		F-20
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED MARCH 31, 2021 AND 2020		F-21
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED MARCH 31, 2021 AND 2020		F-22
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE YEARS ENDED MARCH 31, 2021 AND 2020		F-23
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS		F-24

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of
JR Resources Corp.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of JR Resources Corp. and subsidiaries (collectively, the “Company”), as of March 31, 2021 and 2020, and the related consolidated statements of operations, changes in stockholders’ equity and cash flows for each of the two years in the period ended March 31, 2021, and the related notes to the consolidated financial statements (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended March 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the consolidated financial statements that were communicated or required to be communicated with those charged with governance of the financial statements and that (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) represented especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a separate opinion on the critical audit matters or on the accounts and disclosures to which they relate.

Consolidated Financial Statements — Acquisition of Dakota Territory Resource Corp. (“DTRC”) — See Note 4 to the consolidated financial statements

Critical Audit Matter Description

The Company completed its acquisition of a 49.42% ownership interest in DTRC in October 2020 and acquired an additional interest in March 2021 resulting in a 63.42% ownership interest as of March 31, 2021.

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The transaction was accounted for as an asset acquisition. The Company determined that control of DTRC took place on October 15, 2020 due to its 49.42% ownership interest, rights to acquire additional shares at an exercise price that was in the money, and a contractual agreement providing the Company with operational and financial decision-making authority.

We identified the acquisition of DTRC to be a critical audit matter based on the significant judgements and interpretations required of management in its application of the asset acquisition guidance, the timing of when control was obtained, recognition and subsequent treatment of non-controlling interest, and the overall impact on the consolidated financial statements of the Company.

How the Critical Audit Matter was Addressed in the Audit

Our audit procedures related to management’s assessment of the acquisition of DTRC and the subsequent treatment of non-controlling interest included the following, among others:

We assessed the evidence underlying the accounting of the transaction as an asset acquisition, the timing of the change in control and the recognition of the non-controlling interest. Specifically, we read and evaluated the Company’s asset acquisition accounting memorandum that documented the facts and circumstances in the transaction, which included the factors the Company considered in determining the applicable accounting treatment. In addition, we compared the facts and circumstances in the Company’s accounting memorandum to the acquisition agreement.

We assessed the evidence underlying the subsequent measurement of non-controlling interest. We read and evaluated the Company’s non-controlling interest accounting memorandum that documented the guidance considered and conclusions reached with regards to the recognition of changes in non-controlling interest. In addition, we reviewed and recalculated the Company’s computations for the subsequent changes in NCI.

/s/ Ham, Langston & Brezina, L.L.P.

We have served as JR Resources Corp.’s auditor since 2021.

Houston, Texas

October 21, 2021, except for the effects of the reverse stock split discussed in Note 2 to the consolidated financial statements, as to which the date is March 28, 2022

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JR RESOURCES CORP.

CONSOLIDATED BALANCE SHEETS

	March 31, 2021			March 31, 2020
ASSETS
Current assets
Cash		$	11,444,668		$	141,768
Prepaid expense and other current assets			384,897			—
Loan receivable			—			407,834
Note receivable			—			300,000
Total current assets			11,829,565			849,602
Non-current assets
Mineral properties			57,931,794			—
Property and equipment, net			870,744			—
Total assets		$	70,632,103		$	849,602
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities		$	846,622		$	87,964
Accounts payable – related party			3,000			—
Current portion of notes payable – related party			906,768			—
Total current liabilities			1,756,390			87,964
Non-current liabilities
Non-current portion of notes payable – related party			473,325			—
Deferred tax liability			9,398,458			—
Total liabilities			11,628,173			87,964
Stockholders’ equity
Common stock, par value $0.001; 144,302,330 shares authorized, 35,136,029 and 14,781,124 shares issued and outstanding at March 31, 2021 and 2020, respectively			35,136			14,781
Additional paid in capital			12,105,720			1,205,063
Share subscriptions receivable			—			(126,753)
Retained earnings (deficit)			25,679,461			(331,453)
Equity attributable to stockholders of the Company			37,820,317			761,638
Non-controlling interest			21,183,613			—
Total stockholders’ equity			59,003,930			761,638
Total stockholders’ equity and liabilities		$	70,632,103		$	849,602

The accompanying notes are an integral part of these consolidated financial statements

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JR RESOURCES CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the year ended March 31,
	2021			2020
General and administrative expenses
Consulting		$	670,920		$	—
Exploration costs			271,853			47,668
Office, travel and general			515,104			23,147
Professional fees			634,241			85,226
Write off of mineral properties			—			13,632
Loss from operations			(2,092,118)			(169,673)
Other income (expenses)
Foreign exchange loss			79,001			(26,974)
Gain on derivative assets			27,087,667			—
Interest income			32,443			3,364
			27,199,111			(23,610)
Income (loss) before income tax			25,106,993			(193,283)
Deferred tax benefit			413,424			—
Net income (loss)			25,520,417			(193,283)
Less: Net loss attributable to non-controlling interest			(490,497)			—
Net income (loss) attributable to JR Resources Corp		$	26,010,914		$	(193,283)
Basic and diluted earnings (loss) per share		$	1.12		$	(0.05)
Weighted average number of basic and diluted
common shares outstanding			23,165,060			4,013,877

The accompanying notes are an integral part of these consolidated financial statements

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JR RESOURCES CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the year ended March 31,
	2021			2020
Cash flows used in operating activities
Net income (loss)		$	25,520,417		$	(193,283)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation			17,306			—
Interest income			—			(3,364)
Accretion of debt discount			86,024			—
Write off on mineral properties			—			13,632
Unrealized foreign exchange			—			23,989
Stock-based compensation expense			121,385			—
Gain on derivative assets			(27,087,667)			—
Deferred tax benefit			(413,424)			—
Changes in operating assets and liabilities:
Receivable			(13,317)			—
Prepaid expenses and deposit			(357,177)			—
Accounts payable and accrued liabilities			278,865			(10,268)
Accounts payable – related party			(319,237)			—
Net cash used in operating activities			(2,166,825)			(169,294)
Cash flows used in investing activities
Issuance of note receivable			(1,150,000)			(300,000)
Payments from loan receivable			407,834			—
Purchases of property and equipment			(879,249)			—
Impact on cash of initial consolidation			9,697,502			—
Purchases of mineral properties			(12,807,130)			(428,459)
Net cash used in investing activities			(4,731,043)			(728,459)
Cash flows from financing activities
Issuance of share capital, net of issuance costs			22,563,570			1,093,090
Proceeds from exercise of DTRC stock options and warrants			455,000			—
Payment of cash dividend to non-controlling interest			(4,357,246)			—
Net proceeds repaid to related parties			(460,556)			(55,499)
Net cash provided by financing activities			18,200,768			1,037,591
Net increase in cash			11,302,900			139,838
Cash, beginning of year			141,768			1,930
Cash, end of year		$	11,444,668		$	141,768
Supplemental disclosure with respect to cash flows (See Note 12)

The accompanying notes are an integral part of these consolidated financial statements

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JR RESOURCES CORP.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

	Capital Stock					Additional Paid-in Capital			Share Subscriptions Receivable			Retained Earnings (Deficit)			Non- Controlling Interest			Total Stockholders’ Equity
	Number of Shares		Amount			Additional Paid-in Capital			Share Subscriptions Receivable			Retained Earnings (Deficit)			Non- Controlling Interest			Total Stockholders’ Equity
Balance, March 31, 2019		72		$	1		$	—		$	—		$	(138,170)		$	—		$	(138,169)
Common stock issued for cash, net of issuance costs		14,781,052			14,780			1,205,063			(126,753)			—			—			1,093,090
Net loss		—			—			—			—			(193,283)			—			(193,283)
Balance, March 31, 2020		14,781,124			14,781			1,205,063			(126,753)			(331,453)			—			761,638
Common stock issued for cash, net of issuance costs		20,354,905			20,355			22,416,462			126,753			—			—			22,563,570
Acquisition of DTRC common shares		—			—			(12,911,839)			—			—			25,444,979			12,533,140
Payment of cash dividend by DTRC		—			—			—			—			—			(4,357,246)			(4,357,246)
Change in non-controlling interest		—			—			1,396,034			—			—			(1,396,034)			—
DTRC common stock issued for investment in mineral property		—			—			—			—			—			1,320,000			1,320,000
Stock-based compensation expense		—			—			—			—			—			121,385			121,385
Debt discount on notes payable – related party		—			—			—			—			—			86,026			86,026
DTRC common stock issued upon exercise of options		—			—			—			—			—			455,000			455,000
Net income		—			—			—			—			26,010,914			(490,497)			25,520,417
Balance, March 31, 2021		35,136,029		$	35,136		$	12,105,720		$	—		$	25,679,461		$	21,183,613		$	59,003,930

The accompanying notes are an integral part of these consolidated financial statements

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 1 — Organization and Nature of Business

These consolidated financial statements have been prepared on the assumption that the Company and its subsidiaries will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As of March 31, 2021, the Company had not advanced its properties to commercial production and is not able to finance day-to-day activities through operations. The Company’s continuation as a going concern is dependent upon the successful results from its exploration activities and its ability to attain profitable operations and generate funds therefrom and/or raise equity capital or borrowings sufficient to meet current and future obligations. The Company estimates it has sufficient working capital to continue operations for a period of 12 months from the date of these financial statements.

Uncertainties and Economic Development

Restrictions put in place by federal, state and local governments could delay our exploratory programs on our mineral properties. Furthermore, the impact of the pandemic on the global economy could also negatively impact the availability and cost of future borrowings should the need arise.

It is unknown how long the adverse conditions associated with the pandemic will last and what the complete financial effect will be to the Company. The Company continues to monitor the impact that the pandemic, including relief bills enacted in response thereto, may have on operations. Currently, the Company is unable to determine the impact that the pandemic will have on its financial condition, results of operations, or liquidity.

NOTE 2 — Significant Accounting Policies and Basis of Preparation

The following is a summary of significant accounting policies used in the preparation of these consolidated financial statements.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

Basis of Presentation

The Company’s financial records are maintained on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates include, valuation of stock based compensation, valuation of derivative assets and impairment of long-lived assets. Actual results could differ from those estimates.

Basis of consolidation

These consolidated financial statements include the accounts of the Company and its subsidiaries at the end of the reporting periods as follows:

			Percentage owned
	Incorporation		2021		2020
1169164 B.C. Ltd.		Canada		0%		100%
Seahawk Exploration (US) Inc. (“Seahawk”)		USA		0%		100%
JR (Canada) Resources Services Corp.		Canada		100%		0%
Dakota Territory Resource Corp. (“DTRC”)		USA		63%		0%

On May 15, 2020, the Company sold 1169164 B.C. Ltd., which owned 100% of Seahawk, to a related party for a nominal amount. At the time of the sale, 1169164 B.C. Ltd. did not have any assets or liabilities. As a result of the sale, the Company deconsolidated 1169164 B.C. Ltd. as of May 15, 2020 and did not result in any gain or loss.

As discussed in Note 4, the Company acquired control of DTRC and, as such, the results of DTRC have been included beginning on October 15, 2020.

All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated upon consolidation.

Non-controlling interest represents the portion of a subsidiary’s earnings and losses and net assets that are not held by the Company. If losses in a subsidiary applicable to a non-controlling interest exceed the non-controlling interest in the subsidiary’s equity, the excess is allocated to the non-controlling interest except to the extent the majority interest holder has a binding obligation and is able to cover the losses.

Reverse Stock Split

On March 8, 2022, JR completed a reverse split of its common stock on a 1 for 35,641,667 / 49,398,602 of a share basis, par value $0.001 per share (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each share of common stock issued and outstanding was automatically decreased to approximately 0.721512 of a share of issued and outstanding common stock, without any change in the par value per share. All information related to JR’s common stock, warrants and earnings or loss per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented. This adjustment impacts footnote 9 and 14. To effect the Reverse Stock Split, on March 8, 2022, the Company filed a certificate

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

of change with the Nevada Secretary of State to decrease the number of authorized shares from 200,000,000 to 144,302,330 shares of common stock, par value of $0.001 per share.

Foreign Currency

The financial position and results of operations of the Company’s Canadian subsidiaries are measured using the U.S. dollar as the functional currency. Accordingly, there is no translation gain or loss associated with these operations. Transaction gains and losses related to monetary assets and liabilities where the functional currency is the U.S. dollar are remeasured at current exchange rates and the resulting adjustments are included in the accompanying consolidated statements of operations.

Cash and cash equivalents

The Company considers all highly liquid investments with maturities of three months or less, when purchased, to be cash and cash equivalents. The Company is exposed to credit risk from its deposits of cash in excess of amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses on its deposits of cash.

Loan Receivable

Loan receivable is stated at cost, net of any allowance for doubtful accounts. The Company maintains an allowance for doubtful accounts for estimated losses where there is doubt as to the collectability of the principal amount. In evaluating the collectability of the receivable, the Company considers many factors, including the payment history, length of time past due, credit worthiness of the borrower and economic trends. At March 31, 2020, management believed that the full amount of the loan receivable was collectible and no allowance for doubtful accounts was deemed necessary.

Property and Equipment

Property and equipment consist primarily of land, buildings, office furniture and equipment, and are recorded at cost. Expenditures related to acquiring or extending the useful life of property and equipment are capitalized. Expenditures for repair and maintenance are charged to operations as incurred. Depreciation is computed using the straight-line method over an estimated useful life of 3-39 years.

Mineral Property Costs

The Company has been in the exploration stage since inception and has not yet realized any revenues from its planned operations. All exploration expenditures are expensed as incurred. Costs of acquisition and option costs of mineral rights are capitalized upon acquisition. Mine development costs incurred to develop new ore deposits, to expand the capacity of mines, or to develop mine areas substantially in advance of current production are also capitalized once proven and probable reserves exist and the property is a commercially mineable property. Costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations. If the Company does not continue with exploration after the completion of the feasibility study, the associated capitalized costs will be expensed at that time. Costs of abandoned projects are charged to mining costs including related property and equipment costs.

To determine if the capitalized mineral property costs are in excess of their recoverable amount, the Company conducts periodic evaluation of the carrying value of capitalized costs and any related property and equipment costs based upon expected future cash flows and/or estimated salvage value in accordance with Accounting Standards Codification (ASC) 360-10-35-15, Impairment or Disposal of Long-Lived Assets.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

Fair Value Measurements

The Company accounts for assets and liabilities measured at fair value in accordance with ASC 820, Fair Value Measurements and Disclosures. ASC 820 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The three levels of inputs used to measure fair value are as follows:

•

Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets.

•

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

•

Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value.

The Company’s financial instruments consist principally of cash, note receivable, loan receivable, accounts payable and notes payable. The carrying amounts of such financial instruments in the accompanying financial statements approximate their fair values due to their relatively short-term nature or the underlying terms are consistent with market terms.

Environmental Costs

Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue, generally are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable, and the cost can be reasonably estimated. Generally, the timing of these accruals coincides with the earlier of the completion of a feasibility study or the Company’s commitment to a plan of action based on the then known facts.

Derivative Assets

The Company estimated the fair value of its derivative asset using the Black-Scholes valuation model, in accordance with the provisions of ASC 815, Derivatives and Hedging. Key inputs and assumptions used to estimate the fair value of the derivative asset include the exercise price of the derivative, the expected option term, volatility of the beneficiary’s stock, the risk-free rate, and dividend yield.

Income Taxes

Income taxes are computed using the asset and liability method, in accordance with ASC 740, Income Taxes. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities, and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 2 — Significant Accounting Policies and Basis of Preparation (continued)

technical merits of the position. The Company recognizes a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company adjusts these liabilities when its judgement changes as a result of the evaluation of new information not previously available. Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the current estimate or future recognition of an unrecognized tax benefit. These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

The Company recognizes interest and penalties related to unrecognized tax positions within the income tax expense line in the statements of operations.

Stock-Based Compensation

The Company estimates the fair value of stock-based compensation using the Black-Scholes valuation model, in accordance with the provisions of ASC 718, Compensation — Stock Compensation. Key inputs and assumptions used to estimate the fair value of stock options include the grant price of the award, the expected option term, volatility of the Company’s stock, the risk-free rate, and dividend yield. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by the option holders, and subsequent events are not indicative of the reasonableness of the original estimates of fair value made by the Company.

Basic and Diluted Earnings (Loss) Per Share

The Company computes basic and diluted earnings (loss) per share amounts pursuant to the provisions of ASC 260, Earnings per Share. Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders, by the weighted average number of shares of common stock outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the diluted weighted average number of shares of common stock during the period. The diluted weighted average number of common shares outstanding is the basic weighted number of shares adjusted for the dilutive effect of potential future issuances of common stock related to outstanding options and warrants, if any.

The dilutive effect of outstanding options and warrants is reflected in diluted earnings per share by application of the treasury stock method. The effect of the Company’s outstanding options and warrants were excluded for both the years ended March 31, 2021 and 2020, because they were anti-dilutive.

Noncontrolling interest

The Company initially recognizes a noncontrolling interest recognized in an asset acquisition on the date of acquisition at its fair value. Subsequent to initial recognition and measurement a noncontrolling interest is allocated its share of net income or loss, and its respective share of each component of other comprehensive income of the consolidated subsidiary.

Recent Accounting Pronouncements

Pronouncements between March 31, 2021 and the date of this filing are not expected to have a significant impact on the Company’s operations, financial position, or cash flow, nor does the Company expect the adoption of recently issued, but not yet effective, accounting pronouncements to have a significant impact on our results of operations, financial position or cash flows.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 3 — Note Receivable

In February 2020, the Company advanced $300,000 to DTRC. The note bore interest at 3.0% per year and was due on May 5, 2021. In May 2020, the Company and DTRC entered into an amended and restated promissory note in the amount of $1,450,000, which included the $300,000 that was advanced in February 2020 and an additional $1,150,000 that was advanced in May 2020. The amended and restated unsecured note bore interest at 0.25% per year, compounded annually, and matures on December 31, 2021. At maturity, the principal amount of the note, together with any accrued but unpaid interest, will be due and payable in cash, provided that, if and to the extent that DTRC does not pay this note in cash on the maturity date, then the Company will be required to exercise, and will be deemed to have exercised, its right to convert such unpaid portion of the note into shares of DTRC common stock. The conversion price was $0.60 per share through December 31, 2020 and, thereafter, the lesser of $0.60 per share and the volume weighted average price of DTRC common stock for the five consecutive trading days immediately preceding the date of such conversion (with a floor of $0.40 per share). The note has customary event of default provisions and, upon an event of default, the Company will be required to convert the unpaid portion of the note into the shares of DTRC common stock, if not paid in cash by DTRC.

In connection with the promissory note agreement with DTRC, the Company was granted an option by DTRC to purchase up to 35,641,667 shares of common stock at $0.60 per share in one or more closings on or prior to October 15, 2020. The convertible feature of the amended and restated promissory note was determined to be a derivative asset. At issuance date, the Company determined the fair value of the convertible feature was $1,727,655.

In January 2021, the Company advanced $300,000 to DTRC, on an unsecured basis. On the occurrence of the final closing, the unpaid principal of the loan was applied to the consideration relating to the final close.

NOTE 4 — Acquisition

In May 2020, the Company entered into an agreement with DTRC (the “Agreement”) whereby the Company loaned an additional $1,150,000 to DTRC (see Note 3) and DTRC granted JR the right to purchase up to 35,641,667 shares of common stock of DTRC at $0.60 per share (approximately 64% on a fully diluted basis) in one or more closings on or prior to October 15, 2020. The purchase right was determined to be a derivative asset. At issuance date, the Company determined the fair value of the purchase right was $16,351,772 using a Black Scholes valuation model. The weighted-average assumptions used to calculate the grant date fair value were as follows: (i) risk-free interest rate of 0.17%, (ii) estimated volatility of 223%, (iii) dividend yield of 0%, and (iv) expected life of 0.39 years. The fair value of the purchase right was revalued at each reporting period end with the gain or loss on derivative asset being recorded in the statement of operation. For the year ended March 31, 2021, the Company recognized a gain on derivative assets of $25,251,000 related to the purchase rights.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 4 — Acquisition (continued)

convertible feature of the promissory note, the fair value was equal to the intrinsic value at October 15, 2020. The purchase right derivative assets that were exercised on October 15, 2020 were fair valued at $12,339,161 using a Black Scholes valuation model. However, given there was no term remaining on the purchase right the fair value was equal to the intrinsic value at October 15, 2020.

Immediately after the first closing, the Company owned 49.42% of DTRC common shares outstanding and had the right to purchase a further 18,225,000 DTRC common shares. In addition, the Company substantially controlled the operational and financial decisions of DTRC though contractual agreement related to the use of the investment proceeds. Therefore, the Company determined that the acquisition of control of DTRC took place on October 15, 2020. The acquisition of DTRC has been treated as an acquisition of mineral properties.

The total consideration for the acquisition of the assets and liabilities of DTRC assumed on the acquisition date were as follows:

Consideration:
Conversion of promissory note	$	1,450,000
Value of convertible feature of promissory note		1,836,667
Cash investment		9,000,000
Value of purchase right		12,339,161
Transaction costs		231,043
	$	24,856,871
Allocated as follows:
Cash and cash equivalents	$	9,697,502
Prepaid expenses		14,403
Mineral properties		53,035,706
Property and equipment		8,801
Accounts payable and accrued liabilities		(479,794)
Accounts payable – related party		(1,770,234)
Notes payable – related party		(392,652)
Deferred tax liability		(9,811,882)
Non-controlling interest		(25,444,979)
	$	24,856,871

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 4 — Acquisition (continued)

accordance with the Company’s accounting policy using a market based approach and the non- controlling interest has been recognized at fair value.

The consideration paid, less the DTRC net asset acquired, have been adjusted based on the percentage of shares held by the Company and the non-controlling interest holders and added to the mineral properties to reflect the fair value of the Black Hills Project (See Note 5). As a result of the acquisition, the Company recorded a deferred tax liability of $9,811,882.

NOTE 5 — Mineral Properties

Seahawk Project

The project was located in Box Elder County, Utah, USA.

During the year ended March 31, 2020, the Company impaired the Seahawk project as management did not have further plans to explore the property, as such, the Company recorded an impairment on mineral properties of $13,632.

During the year ended March 31, 2021, the Company sold the project to a related party for a nominal value.

Black Hills Project

As a result of the acquisition of a controlling financial interest in DTRC (See Note 4), the Company acquired a 100% right, title and interest in mining claims located in the Homestake Gold District of the Black Hills of South Dakota, USA.

In October 2020, the Company completed the purchase of the Maitland Gold Property from Homestake Mining Company of California, a wholly owned subsidiary of Barrick Gold Corporation (“Barrick”). At closing, the Company paid Barrick $3.5 million cash and issued 750,000 shares of DTRC common stock valued at $1.76 per share, for a total consideration of $4.82 million. Additionally, Barrick retained a 2.5% net smelter returns royalty on the property.

In November 2020, the Company acquired 64 unpatented lode mining claims covering approximately 1,092 acres located south and to the west of the former Homestake Gold Mine at Lead, South Dakota. The Poorman Anticline geological structure is the southwestern-most known extension of the Homestake iron- formation host in the district. Gold mineralization was discovered underground on the 2,600 and 4,100 foot levels in the far western extents of the Homestake Mine in the 1950’s and 60’s with little historic follow-up exploration in the Poorman Anticline closer to surface. The Company’s targeting in the Poorman Anticline is based on the presence of the Homestake iron-formation host and projected intersections with important shear fabric that is known to have conducted fluids necessary to the deposition of gold mineralization in the northern extents of the structural corridor.

In January 2021, the Company acquired 143 unpatented lode mining claims covering approximately 2,468 acres. The acquisition was based on continuing analysis of the Company’s historic data sets coupled with new insights derived from the Company’s district-scale airborne geophysical survey flown during the summer of 2020 and increased the acreage covered by three of the Company’s existing project areas. At

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 5 — Mineral Properties (continued)

the west side of the Homestake District, the Tinton property was extended to the north and northwest adding approximately 1,966 acres to the original claim block. In the central region of the District, the West Corridor property was extended west to Cleopatra Creek covering approximately 242 additional acres between Richmond Hill and Wharf gold mines, and the Blind Gold Property was expanded west adding approximately 260 acres immediately north of the Richmond Hill Mine.

In March 2021, the Company acquired 39 unpatented lode mining claims covering approximately 806.5 at the eastern boundary of the Company’s Tinton Property. Tinton was the site of placer mining activity between 1876 and the turn of the century, the lode source for which has not been discovered. The original Tinton claim block was located based on historic research and exploration conducted by members of our technical team at Homestake Mining Company in the 1980’s and 1990’s, which suggested a Pre-Cambrian lode source at depth. The latest property acquisition is focussed on additional younger Tertiary-aged gold mineralization in the younger sedimentary and igneous rocks covering the property.

In March 2021, the Company acquired, by option, 25 patented mining claims covering approximately 307 acres at the eastern boundary of the northern segment of the Company’s Ragged Top Property. The property was acquired from Donald Valentine of Steamboat Springs, Colorado. Two additional unpatented lode claims covering approximately 29 acres were also acquired by staking and added at the north end of the property. The Ragged Top Property has been subject to historic mining operations producing Tertiary- aged gold and silver mineralization primarily from vertical fissures and collapsed breccias within the Paha Sapa limestone unit. The Ragged Top property is located just northwest of the producing Wharf Mine (Coeur Mining) and approximately 3 miles southwest of the former Richmond Hill Mine (Barrick Gold).

As of March 31, 2021 and 2020, the Company’s mineral properties totaled $57,931,794 and $0, respectively. As of March 31, 2021, the Company is in the exploration stage and has not commenced amortization of its properties.

NOTE 6 — Property and Equipment

As of March 31, 2021 and 2020, the Company’s property and equipment consists of the following:

	Estimated Useful Life (Years)		2021			2020
Land				$	70,000		$	—
Building		39			503,711			—
Furniture and equipment	3 – 5				314,339			—
					888,050			—
Less accumulated depreciation					(17,306)			—
Property and equipment, net				$	870,744		$	—

Depreciation expense for the year ended March 31, 2021 was $17,306.

NOTE 7 — Loan Receivable

During the year ended March 31, 2020, the Company advanced a total of $407,834 to a third party. The unsecured loan bears interest at 5% per annum and is payable on demand. During the year ended March 31, 2021, the Company advanced a further $1,144,416 to the same party and recorded interest income of $27,252. The loan was repaid in full prior to March 31, 2021.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 8 — Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consists of the following at March 31, 2021 and 2020:

	March 31, 2021			March 31, 2020
Trade payables		$	524,512		$	87,964
Refundable share subscriptions paid			321,362			—
Other			748			—
		$	846,622		$	87,964

NOTE 9 — Share Capital

Authorized Share Capital

In connection with the domestication process on May 22, 2020, the Company changed its share capital structure from common stock without par value to 200,000,000 authorized shares of common stock (on a pre-reverse stock split basis), with a par value of $0.001 per share.

Issued Share Capital

During the year ended March 31, 2020, the Company issued 14,781,052 common shares at a weighted average price of $0.08 for proceeds of $1,219,843 through various private placements. As at March 31, 2020, the Company had subscriptions receivable totaling $126,753, owing by a related party, which the Company received in full subsequent to the year end.

During the year ended March 31, 2021, the Company issued 5,632,508 common shares at a weighted average price of $0.38 for proceeds of $2,126,387 and 14,722,397 units at a price of $1.39 for proceeds of $20,405,269 through various private placements. Each unit consists of one common share of the Company and one-half of a warrant. Each whole warrant is exercisable into one common share of the Company at an exercise price of $2.08 for a period of 5 years. In connection with the private placement, the Company incurred expenses of $94,839.

Dividends

On November 13, 2020, DTRC declared a special cash dividend of $0.30 per common share, totaling $4,357,246, to the non-controlling interest stockholders of record as at December 22, 2020 and paid $4,357,246 on 14,289,782 shares of common stock. The Company had contractually waived its right to receive its pro-rata share of this special cash dividend. This dividend was paid in January 2021.

Share Purchase Warrants

During the year ended March 31, 2021, in connection with various private placements, the Company issued 7,363,193 warrants with an exercise price of $2.08 per warrant. ASC 480, Distinguishing Liabilities from Equity, provides that these warrants are classified as equity. The fair value of these warrants totaled $3,567,641 and was determined using the Black-Scholes Merton valuation model.

Number of warrants	Exercise price			Remaining life (years)		Expiry date
3,318,900		$	2.08		4.54	October 13, 2022
184,902		$	2.08		4.88	February 15, 2023
3,859,391		$	2.08		4.96	March 15, 2023
7,363,193

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 9 — Share Capital (continued)

A summary of changes of warrants outstanding is as follows:

	Warrants		Weighted average exercise price
Balance, March 31, 2019 and 2020		—		$	—
Issued		7,363,193			2.08
Balance, March 31, 2021		7,363,193		$	2.08

All of the common stock, warrants, units and per share amounts of JR in these financial statements and notes there to have been adjusted for an approximately 0.721512-for-1 reverse stock split which took effect on March 8, 2022.

Stock Options

DTRC’s 2015 Omnibus Incentive Plan (the “Omnibus Plan”) authorizes DTRC to grant or issue non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, cash-based awards or other stock-based awards up to a total of 3,750,000 shares of DTRC. Under the terms of the Omnibus Plan, awards may be granted to employees, directors and third-party service providers. Awards issued under the Omnibus Plan vest as determined by the board of directors at the time of grant. Any shares related to an award granted under the Omnibus Plan that terminates by expiration, forfeiture, or otherwise without the issuance of the shares shall be available again for grant under the Omnibus Plan. As of March 31, 2021, a total of 1,087,500 shares remained available for future grants under the Omnibus Plan.

Outstanding stock options under the Omnibus Plan have terms ranging from 5 to 10 years. Outstanding stock options granted to third-party service providers generally vest over the period of the contract, which is typically one year. During the year ended March 31, 2021, DTRC granted a total of 750,000 stock options with an exercise price of $1.92 exercisable for up to five years. The Company recognized stock-based compensation related to issuance of stock options totaling $121,385 and $0 during the years ended March 31, 2021 and 2020, respectively, which is included in general and administrative expenses in the accompanying statements of operations. During the year ended March 31, 2021, the Company estimated the fair value of each stock option on the date of grant using a Black Scholes valuation model. The weighted-average assumptions used to calculate the grant date fair value were as follows: (i) risk-free interest rate of 1.52%, (ii) estimated volatility of 80%, (iii) dividend yield of 0%, and (iv) expected life of 5 years. As at March 31, 2021, the Company had unamortized stock-based compensation expense of $4,963,034.

A summary of DTRC’s stock option activity and related information for the period ended March 31, 2021 is as follows:

	Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Life (In Years)		Aggregate Intrinsic Value
Outstanding as of October 15, 2020		2,062,500		$	0.32		4.13		$	2,146,000
Options granted .		750,000			1.92		4.96			—
Options exercised		(1,987,500)			0.32		—			—
Outstanding as of March 31, 2021 .		825,000			1.77		4.86			285,000

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 9 — Share Capital (continued)

	Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Life (In Years)		Aggregate Intrinsic Value
Options vested or expected to vest as of March 31, 2021		75,000			0.32		3.84			135,000
Options exercisable as of March 31, 2021		75,000		$	0.32		3.84		$	135,000

NOTE 10 — Related Party Transactions

Mr. Gerald Aberle is DTRC’s Chief Operating Officer. He is also a director and significant shareholder of DTRC and the owner of Jerikodie, Inc. Under a February 2012 agreement, Jerikodie Inc. earns a fixed consulting fee of $9,000 per month, plus approved expenses. In October 2020, the Company paid Jerikodie, Inc, $200,000 of the approximate $729,500 owed to it for consulting fees and issued a note payable to Jerikodie for the remaining balance of approximately $529,500 bearing interest at 0.25% per year. On June 1, 2021 the Company and Jerikodie settled debt of $529,500 through the payment of $376,550 and the issuance of 45,563 shares of common stock resulting in a loss on settlement of debt of $54,169. During the year ended March 31, 2021, the Company engaged a company controlled by a family member of Mr. Aberle, for the purpose of providing general labor and incurred approximately $37,000 in costs.

Mr. Richard Bachman is DTRC’s former Chief Geological Officer (“CGO”). He is also a director and significant stockholder of DTRC and the owner of Minera Teles Pires Inc. (“Minera Teles”). Under an

October 2005 agreement that expired in March 2020, Minera Teles earned a $10,000 monthly consulting fee and received $1,500 per month for office rent and expenses. The consulting fee was divided between a $5,000 per month cash payment and a $5,000 per month deferred amount. DTRC also owed Mr. Bachman, individually, $305,145 in unsecured loans. These unsecured loans bear interest at rates ranging from 3% to 4% per year and are due on demand. In June 2020, DTRC repaid $40,145 of unsecured loans, plus accrued interest totaling $6,095. In October 2020, DTRC paid Minera Teles $200,000 for amounts owed for prior services and combined the remaining amount owed of approximately $795,500 with amounts owed under the unsecured loans, including unpaid interest, into a new note in the amount of $1,055,310, bearing interest at 0.25% per year. A payment of $145,000 was made in December 2020. As of March 31, 2021, the unpaid principal balance totalled $910,454.

In October 2020, the Company issued a note payable to WCM Associates, LP, an entity controlled by DTRC’s former CFO, in the amount of $123,000, bearing interest at 0.25% per year, for amounts owed for consulting fees. Subsequent to March 31, 2021, the note has been paid in full.

In September 2019, Mr. O’Rourke, a director of DTRC, was issued a five-year option to purchase 250,000 shares of our common stock at an exercise price of $0.32 per share in exchange for consulting services. Mr. O’Rourke exercised these options for cash in October 2020.

In October and December 2020, options to purchase 1,075,000 shares of DTRC common stock were exercised for $344,000 by DTRC’s officers and directors. Messrs. Aberle and Bachman own a 5% net smelter return royalty on the original 84 unpatented mining claims that comprised the Blind Gold Property.

NOTE 11 — Non-Controlling Interest

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 11 — Non-Controlling Interest (continued)

Balance, March 31, 2020	$	—
Acquisition of DTRC		25,444,979
Payment of cash dividend by DTRC		(4,357,246)
Change in non-controlling interest		(1,396,034)
DTRC common stock issued for investment in mineral property		1,320,000
Stock-based compensation expense		121,385
Debt discount on notes payable – related party		86,026
DTRC common stock issued upon exercise of options		455,000
Net loss attributable to non-controlling interest		(490,497)
Balance, March 31, 2021	$	21,183,613

In October 2020, the Company acquired 49.42% of the DTRC common shares outstanding. In March 2021, the Company and DTRC effected the second and final closing whereby the Company increased its interest in DTRC from 49.42% to 63.42%. As of March 31, 2021, there were no further changes to the Company’s ownership of DTRC.

NOTE 12 — Supplemental Disclosures With Respect to Cash Flows

	For the year ended March 31,
	2021			2020
Supplemental cash flow information
Cash paid for interest expense		$	—		$	—
Cash paid for income taxes		$	—		$	—
Non-cash investing and financing activities
DTRC common stock issued for investment in mineral property		$	1,320,000		$	—
Conversion of note receivable as consideration for mineral properties		$	1,450,000		$	—
Related party accounts payable and accrued interest converted to related party note payable		$	1,447,997		$	—
Conversion of derivative to consideration for mineral properties		$	12,339,161		$	—
Value of convertible feature of promissory note as consideration for mineral properties		$	1,836,667		$	—

NOTE 13 — Income Taxes

The following table set forth a reconciliation of the statutory federal income tax for the years ended March 31, 2021 and 2020:

	Years ended March 31,
	2021			2020
Income tax (expense) benefit computed at federal statutory rates		$	(5,272,469)		$	40,589
Non-deductible stock based compensation			(25,470)			—
Non-deductible interest expense			(4,565)			—
Non-taxable gain on derivatives			5,688,410			—

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 13 — Income Taxes (continued)

	Years ended March 31,
	2021			2020
Other non-deductible expenses			(62,583)			—
Unrecognized temporary differences			52,374			—
Change in valuation allowance			37,727			(40,589)
Deferred tax benefit		$	413,424		$	—

The tax effects of the temporary differences between reportable financial statement income and taxable income are recognized as a deferred tax asset and liability. Significant components of the deferred tax assets are set out below along with a valuation allowance to reduce the net deferred tax asset to zero as of March 31, 2020.

In order to comply with generally accepted accounting principles in the United States of America, management has decided to establish a valuation allowance because of the potential that the tax benefits underlying deferred tax asset may not be realized. With the acquisition of DTRC, the valuation allowance was reversed due to the net deferred tax liability position.

Significant components of deferred tax assets and liabilities are as follows:

	As of March 31,
	2021			2020
Deferred income tax assets:
Net operating losses		$	1,502,021		$	37,727
Net capital losses			36,685			—
Less: valuation allowance			—			(37,727)
Deferred income tax liability:
Property and equipment			(182,856)			—
Mineral properties			(10,754,308)			—
Deferred income tax liability, net		$	9,398,458		$	—

As at March 31, 2021, the Company had accumulated net operating losses of approximately $7,100,000 that begin to expire in 2027.

Tax attributes are subject to review, and potential adjustment by tax authorities. As of March 31, 2021, the Company’s tax returns for all periods since inception remain subject to examination for both federal and state filings.

NOTE 14 — Subsequent Events

Subsequent to March 31, 2021, the Company issued 505,050 units at a price of $1.39 for proceeds of $700,000 through various private placements. Each unit consists of one common share of the Company and one-half of a share purchase warrant. Each whole warrant is exercisable into one common share of the Company at an exercise price of $2.08 for a period of 5 years.

On May 14, 2021, the Company entered into a definitive merger agreement with DTRC (“Merger Agreement”). Pursuant to the Merger Agreement, the Company and DTRC will incorporate a new company (“NewCo”) that will acquire all of the outstanding securities of DTRC and of the Company in exchange for securities of NewCo (the “Merger”). Shareholders of the Company will

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 14 — Subsequent Events (continued)

receive a number of NewCo shares of common stock equal to their percentage shareholding in JR multiplied by the 35,641,667 DTRC shares that JR owns. Shareholders of DTRC other than JR will receive one share of common stock of NewCo for each share of common stock of DTRC.

•

DTRC shareholders will receive one share of JR Resources (which will be renamed Dakota Gold Corp. prior to closing) for each share of DTRC;

•

JR shareholders will continue to hold shares of JR (which will be renamed Dakota Gold Corp. prior to closing); and

•

On March 8, 2022, prior to the closing of the Merger, JR completed a reverse share split such that the total number of JR shares was proportionately reduced to 35,641,667 JR shares.

There can be no assurance that the necessary approvals will be obtained, or the structure of the merger will be as outlined, or completed at all.

On May 21, 2021, the Company purchased surface and mineral title to approximately 213 acres located contiguous to the northwest boundary of the Company’s West Corridor Property. The property is also located just south of the mineral property DTRC acquired from Deadbroke Mining Company in the Maitland Area in March of 2014, just north of the producing Wharf Mine (Coeur Mining) and just to the south and east of the former Richmond Hill Mine (Barrick Gold). The purchased property is subject to a 2% NSR Royalty held by Homestake Mining Company of California and a buyback right for 51% interest in the property subject to, among other provisions, the establishment of a 1,000,000-ounce reserve and/or inferred resource from one or more deposits located within a one-kilometer area of influence surrounding the property.

On June 4, 2021, DTRC issued 1,450,000 shares of DTRC common stock and 1,050,000 DTRC restricted share units to certain directors, officers, employees and consultants. On May 17, 2021, 2,071,250 DTRC options with a weighted average exercise price of $4.76 exercisable for 5 years were granted.

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JR RESOURCES CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the years ended March 31, 2021 and 2020

NOTE 14 — Subsequent Events (continued)

On August 2, 2021, DTRC entered into a series of substantially similar subscription agreements pursuant to which the Company issued and sold to certain investors, in the final tranche of the Private Placement, an aggregate of 120,550 common shares at a price of $4.50 per share, for gross proceeds of $542,475. In aggregate with the first tranche issuance of 2,311,000 common shares for gross proceeds of $10,399,500, and the second tranche issuance of 8,734,611 common shares for $39,305,750, DTRC issued a total of 11,166,161 common shares for total gross proceeds of $50,247,725.

On September 7, 2021, DTRC announced that it had entered into a binding definitive option agreement (the “Definitive Agreement”) to acquire Homestake Mining Company of California’s (“HMCC” or “Homestake”) surface rights and certain residual facilities in the Homestake District, South Dakota.

Under the terms of the Definitive Agreement, DTRC has a three-year option to acquire 4,261 acres of surface rights with attendant facilities and data held by HMCC (the “Option”). In consideration for the Option, DTRC made a cash payment of US$1.3 million and issued 1 million shares of common stock of DTRC to Barrick and will make annual option payments of US$300,000 during the Option period. DTRC may exercise the Option on or before September 7, 2024, by assuming all of the liabilities and bonds currently held by HMCC in the Homestake District. In addition, on exercise of the Option, DTRC will issue Barrick 3 million shares of DTRC and grant a 2.5% NSR to Barrick with respect to any gold that may be recovered from the Grizzly Gulch property.

The Company’s management has evaluated the effect of subsequent events on the Company’s consolidated financial statements through October 21, 2021, the date the consolidated financial statements were available to be issued and has concluded there are no additional events to be reported.

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INDEX TO FINANCIAL STATEMENTS

DAKOTA TERRITORY RESOURCE CORP.

	Condensed Consolidated Financial Statements (unaudited)
	Condensed Consolidated Interim Balance Sheets as of September 30, 2021 and March 31, 2021					F-41
	Condensed Consolidated Interim Statements of Operations for the Three and Six Months Ended September 30, 2021 and 2020					F-42
	Condensed Consolidated Interim Statements of Cash Flows for the Three and Six Months Ended September 30, 2021 and 2020					F-43
	Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity for the Three and Six Months Ended September 30, 2021 and 2020					F-44
	Notes to Condensed Consolidated Interim Financial Statements					F-46
	Financial Statements (audited)
	Report of Independent Registered Public Accounting Firm					F-54
	Balance Sheets as of March 31, 2021 and 2020					F-55
	Statements of Operations for the Years Ended March 31, 2021 and 2020					F-56
	Statements of Cash Flows for the Years Ended March 31, 2021 and 2020					F-57
	Statements of Changes in Stockholders’ Equity for the Years Ended March 31, 2021 and 2020					F-58
	Notes to Financial Statements					F-59

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DAKOTA TERRITORY RESOURCE CORP.

CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
(Unaudited)

	December 31, 2021			March 31, 2021
ASSETS
Current assets
Cash and cash equivalents		$	46,637,914		$	10,392,940
Prepaid expenses and other current assets			173,604			75,608
Total current assets			46,811,518			10,468,548
Mineral properties			20,297,409			5,337,072
Property and equipment			1,341,109			870,744
Total assets		$	68,450,036		$	16,676,364
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities		$	619,598		$	165,024
Current portion of notes payable – related party			—			906,768
Total current liabilities			619,598			1,071,792
Notes payable – related party			—			473,325
Total liabilities			619,598			1,545,117
Commitments and contingencies
Shareholders’ equity
Common stock, par value $0.001; 75,000,000 shares authorized, 70,828,204 and 56,197,331 shares issued and outstanding as of December 31, 2021 and March 31, 2021, respectively			70,828			56,197
Additional paid-in capital			98,956,100			23,617,834
Accumulated deficit			(31,196,490)			(8,542,784)
Total shareholders’ equity			67,830,438			15,131,247
Total liabilities and shareholders’ equity		$	68,450,036		$	16,676,364

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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DAKOTA TERRITORY RESOURCE CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS
(Unaudited)

	Three Months Ended December 31,						Nine Months Ended December 31,
	2021			2020			2021			2020
Operating expenses
Exploration costs		$	2,058,521		$	94,071		$	6,117,247		$	576,260
General and administrative expenses			3,391,952			158,364			16,427,931			524,266
Total operating expenses			5,450,473			252,435			22,545,178			1,100,526
Loss from operations			(5,450,473)			(252,435)			(22,545,178)			(1,100,526)
Other income (expense)
Loss on debt settlement			—			—			(124,521)			—
Interest income			9,760			140			16,094			2,140
Interest expense			—			(1,048,735)			(101)			(1,322,244)
Other income			—			5,000			—			5,000
Total other income (expense)			9,760			(1,043,595)			(108,528)			(1,315,104)
Net loss		$	(5,440,713)		$	(1,296,030)		$	(22,653,706)		$	(2,415,630)
Net loss per share:
Basic and diluted net loss per share		$	(0.08)		$	(0.04)		$	(0.35)		$	(0.11)
Weighted average number of shares outstanding
Basic and diluted			70,541,658			31,374,130			65,079,372			21,174,813

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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DAKOTA TERRITORY RESOURCE CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)

	Nine Months Ended December 31,
	2021			2020
Cash flows from operating activities
Net loss		$	(22,653,706)		$	(2,415,630)
Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense			16,353,160			—
Loss on settlement of debt			124,521			—
Depreciation expense			103,411			868
Amortization of debt discount			—			1,315,644
Changes in current assets and liabilities
Prepaid expenses and other current assets			(97,996)			(87,604)
Accounts payable and accrued expenses			455,322			(100,104)
Accounts payable – related party			—			(329,621)
Net cash used in operating activities			(5,715,288)			(1,616,447)
Cash flow from investing activities
Purchases of property and equipment			(573,776)			(20,789)
Purchases of mineral properties			(6,179,873)			(3,751,012)
Net cash used in investing activities			(6,753,649)			(3,771,801)
Cash flow from financing activities
Proceeds from sale of common stock			50,270,224			9,380,000
Share issuance costs			(754,598)			—
Repayment of note payable – related party			(801,715)			—
Proceeds from exercise of options			—			631,000
Proceeds from the issuance of note payable – related party			—			(210,645)
Proceeds from note payable			—			1,150,000
Repayment of line of credit, net			—			(5,194)
Net cash provided by financing activities			48,713,911			10,945,161
Net change in cash and cash equivalents			36,244,974			5,556,913
Cash and cash equivalents, beginning of period			10,392,940			146,425
Cash and cash equivalents, end of period		$	46,637,914		$	5,703,338
Supplemental cash flow information:
Interest paid		$	—		$	6,865
Non-cash investing and financing activities:
Common stock issued for investments in mineral properties		$	8,780,464		$	1,320,000
Common stock issued for settlement of notes payable		$	703,647		$	—
Common stock issued upon conversion of note payable		$	—		$	1,450,000
Related party accounts payable converted to related party note		$	—		$	1,447,997

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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DAKOTA TERRITORY RESOURCE CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
For the three months ended December 31, 2021 and 2020
(Unaudited)

	Common Stock					Additional Paid-in Capital			Accumulated Deficit			Total
	Shares		Amount			Additional Paid-in Capital			Accumulated Deficit			Total
Balance, September 30, 2021		70,428,204		$	70,428		$	94,102,303		$	(25,755,777)		$	68,416,954
Common stock issued for investment in mineral properties		400,000			400			1,815,600			—			1,816,000
Stock-based compensation expense		—			—			3,038,197			—			3,038,197
Net loss for the period		—			—			—			(5,440,713)			(5,440,713)
Balance, December 31, 2021		70,828,204		$	70,828		$	98,956,100		$	(31,196,490)		$	67,830,438
Balance, September 30, 2020		17,628,741		$	17,629		$	4,490,918		$	(6,497,343)		$	(1,988,796)
Issuance of previously unissued shares		137,500			138			(138)			—			—
Common stock issued for cash		15,000,000			15,000			8,985,000			—			9,000,000
Common stock issued for investment in mineral properties		750,000			750			1,319,250			—			1,320,000
Common stock issued upon conversion of debt		2,416,667			2,417			1,447,583			—			1,450,000
Common stock issued upon exercise of options and warrants		1,912,500			1,913			605,087			—			607,000
Common stock issued upon cashless exercise of options		126,923			127			(127)			—			—
Debt discount on notes payable, related party		—			—			86,024			—			86,024
Cash dividend		—			—			(4,357,246)			—			(4,357,246)
Net loss for the period		—			—			—			(1,296,030)			(1,296,030)
Balance, December 31, 2020		37,972,331		$	37,974		$	12,576,351		$	(7,793,373)		$	4,820,952
Balance, March 31, 2021		56,197,331		$	56,197		$	23,617,834		$	(8,542,784)		$	15,131,247
Private placement		11,203,661			11,203			50,259,021			—			50,270,224
Common stock issued for investment in mineral properties		1,832,600			1,833			8,778,631			—			8,780,464
Common stock issued upon settlement of debt		144,612			145			703,502			—			703,647
Share issuance costs		—			—			(754,598)			—			(754,598)
Stock-based compensation expense		1,450,000			1,450			16,351,710			—			16,353,160
Net loss for the period		—			—			—			(22,653,706)			(22,653,706)
Balance, December 31, 2021		70,828,204		$	70,828		$	98,956,100		$	(31,196,490)		$	67,830,438
Balance, March 31, 2020		16,354,197		$	16,354		$	2,783,193		$	(5,377,743)		$	(2,578,196)

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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DAKOTA TERRITORY RESOURCE CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Continued)
For the three months ended December 31, 2021 and 2020
(Unaudited)

	Common Stock					Additional Paid-in Capital			Accumulated Deficit			Total
	Shares		Amount			Additional Paid-in Capital			Accumulated Deficit			Total
Issuance of previously unissued shares		412,500			413			(413)			—			—
Cash received for unissued shares		—			—			380,000			—			380,000
Common stock issued for cash		15,000,000			15,000			8,985,000			—			9,000,000
Common stock issued for investment in mineral properties		750,000			750			1,319,250			—			1,320,000
Common stock issued upon conversion of debt		2,416,667			2,417			1,447,583			—			1,450,000
Common stock issued upon exercise of options and warrants		1,987,500			1,988			629,012			—			631,000
Common stock issued upon cashless exercise of options and warrants		1,051,467			1,052			(1,052)			—			—
Debt discount assigned to purchase option		—			—			1,305,000			—			1,305,000
Debt discount on notes payable, related party		—			—			86,024			—			86,024
Cash dividend		—			—			(4,357,246)			—			(4,357,246)
Net loss for the period		—			—			—			(2,415,630)			(2,415,630)
Balance, December 31, 2020		37,972,331		$	37,974		$	12,576,351		$	(7,793,373)		$	4,820,952

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 1 — Summary of Accounting Policies

Basis of Presentation and Going Concern

The accompanying unaudited interim condensed consolidated financial statements (“interim financial statements”) of Dakota Territory Resource Corp. (“we”, “us”, “our”, the “Company”, “Dakota Territory”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and the rules of the Securities and Exchange Commission (“SEC”) for interim statements, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K, for the year ended March 31, 2021, as filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal year ended March 31, 2021, as reported in the Company’s Annual Report on Form 10-K, have been omitted. The year-end balance sheet data was derived from the audited financial statements. Unless otherwise noted, there have been no material changes to the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K.

Uncertainties and Economic Development

In March 2020, the World Health Organization designated the new coronavirus (“COVID-19”) as a global pandemic. Federal, state and local governments have mandated orders to slow the transmission of the virus, including but not limited to shelter-in-place orders, quarantines, restrictions on travel, and work restrictions that prohibit many employees from going to work. Uncertainty with respect to the economic effects of the pandemic has resulted in significant volatility in the financial markets. The restrictions put in place by federal, state and local governments could delay the Company’s exploratory programs on its mineral properties. Furthermore, the impact of the pandemic on the global economy could also negatively impact the availability and cost of future borrowings or equity financing should the need arise. It is unknown how long the adverse conditions associated with the pandemic will last and what the complete financial effect will be to the Company. The Company continues to monitor the impact that the pandemic, including relief bills enacted in response thereto, may have on operations. Currently, the Company is unable to determine the impact that the pandemic will have on its financial condition, results of operations, or liquidity.

Reverse Stock Split

On May 13, 2021, the Board of Directors of the Company approved a reverse stock split of the Company’s common stock at a ratio of 1-for-4. The reverse stock split was made effective on May 25, 2021, and all share numbers and common stock prices presented give effect to the reverse split.

Merger Agreement

On September 10, 2021, the Company and JR Resources Corp. (“JR”) entered into an Amended and Restated Agreement and Plan of Merger (as may be amended from time to time, the “merger agreement”) providing for a business combination of the Company and JR. Prior to the completion of the transactions, JR will change its name to Dakota Gold Corp. (“Dakota Gold”).

Under the terms of the merger agreement, after the completion of the transactions, Dakota Gold will be the parent company. In the transactions, the Company’s stockholders will receive one share of Dakota Gold common stock for each share of the Company’s common stock that they own at the time of the closing of the transactions. It is anticipated that, upon the closing of the transactions, the Company’s former

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 1 — Summary of Accounting Policies (continued)

stockholders will own approximately 49% and JR’s existing stockholders will own approximately 51% of the outstanding shares of Dakota Gold Corp. common stock.

The parties contemplate that, effective at, or around the time of, the completion of the transactions, Dakota Gold’s common stock will be traded on the NYSE American stock exchange (the “NYSE American”) under the symbol “DC” through the “uplisting” of the Company’s common stock, which currently trades on the OTCQB under the symbol “DTRC.” Although the Company’s has applied for listing of Dakota Gold’s common stock on the NYSE American, no assurance can be given that the Company’s listing application will be approved.

The Company will hold a special meeting of its stockholders to consider and vote on matters necessary to complete the transactions contemplated by the merger agreement. The completion of the Merger is subject to customary closing conditions for a transaction of this nature, including securities law compliance and the approval of the Company’s shareholders.

Please see the Company’s Management’s Discussion and Analysis for further details on the merger agreement.

Consolidation

On April 30, 2021, the Company incorporated Dakota Gold Services (Canada) Corp. (“Dakota Canada”) under the British Columbia Business Corporations Act. These financial statements consolidate Dakota Canada, a wholly-owned subsidiary. All significant intercompany transactions and accounts have been eliminated on consolidation.

Going Concern

The accompanying financial statements have been prepared in conformity with U.S. GAAP which contemplates continuation of the Company as a going-concern basis. The going-concern basis assumes that assets are realized, and liabilities are settled in the ordinary course of business at amounts disclosed in the financial statements. At March 31, 2021, the Company had not generated any revenues since inception and had suffered recurring losses from operations which raised substantial doubt about its ability to continue as a going concern.

The Company’s ability to continue as a going concern is dependent upon its ability to generate profitable operations in the future and/or obtain the necessary financing, in the form of equity or debt financing, to meet its obligations when they become due. During the period June through August 2021, the Company raised approximately $50 million in a non-brokered private placement. Management believes the proceeds are sufficient to meet its obligations as they become due for the twelve months following the filing date of these financial statements and, accordingly, substantial doubt about the Company’s ability to continue as a going concern has been alleviated.

Note 2 — Related Party Transactions

The Company engages in related party transactions that involve its officers and directors and/or companies controlled by its officers and directors. Following is an analysis of related party transactions:

Mr. Gerald Aberle is the Company’s former President, Chief Executive Officer and is currently Chief Operating Officer of the Company. He is also a director and significant shareholder of the Company and the owner of Jerikodie Inc. (“Jerikodie”). Under a February 2012 agreement, Jerikodie earned a fixed consulting fee of $9,000 per month, plus approved expenses. In October 2020, the Company paid Jerikodie $200,000 of the approximate $729,500 owed to it for consulting fees and issued a note payable to Jerikodie for

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 2 — Related Party Transactions (continued)

the remaining balance of $529,500 bearing interest at 0.25% per year. On June 1, 2021, the Company and Jerikodie settled debt of $529,544 through the payment of $376,550 and the issuance of 45,563 shares of common stock. The fair value of the consideration paid to settle the note exceeded the carrying amount of the note, resulting in a loss on settlement of $92,045. During the three and nine months ended December 31, 2021, the Company paid Jerikodie $0 and $66,178, respectively (2020 — $27,000 and $81,000, respectively) for consulting fees, in addition to $25,000 in the nine months ended December 31, 2021, for the extinguishment of a net smelter royalty disclosed below. Effective April 15, 2021, the agreement with Jerikodie was terminated. The Company engaged a Company controlled by a family member of Mr. Aberle, for the purpose of providing general labor and during the three and nine months ended December 31, 2021, incurred approximately $23,000 and $43,000 in costs, respectively (2020 — $0).

During the three and nine months ended December 31, 2021, the Company incurred $0 and $6,000, respectively (2020 — $9,000 and $27,000, respectively) for consulting fees to WCM Associates, LP, an entity controlled by the Company’s former CFO.

Note 3 — Mineral Properties

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 3 — Mineral Properties (continued)

the Tinton Property, the Poorman Anticline Property, the Ragged Top Gold Camp, the West Corridor Property, the City Creek Property and added the South Lead/Whistler Gulch Property through both acquisitions and claim staking.

As of December 31, 2021, and March 31, 2021, the cost of the Company’s mineral properties totaled $20,297,409 and $5,337,072, respectively. As of December 31, 2021, the Company is in the exploration stage and has not commenced amortization of its properties.

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 4 — Notes Payable

JR Resources Corp.

In February 2020, the Company entered into a $300,000 unsecured promissory note agreement with JR. The note bore interest at 3.0% per year and was due on May 5, 2020. In May 2020, JR and the Company entered into an amended and restated promissory note in the amount of $1,450,000, which included the $300,000 that was advanced in February 2020 and an additional $1,150,000 that was advanced in May 2020. The amended and restated unsecured note bore interest at 0.25% per year, compounded annually, and was converted into shares of the Company’s common stock in October 2020, as further described below.

In October 2020, JR acquired 2,416,667 shares of the Company’s common stock for aggregate consideration of $10,450,000, consisting of $9,000,000 in cash and $1,450,000 upon conversion of the principal amount of the promissory note issued in May 2020. In connection with the conversion, the Company recognized the remaining $1,036,849 of unamortized debt discount as interest expense. For the three and nine months ended December 31, 2020, the Company recognized additional interest expense of approximately $1,047,000 and $1,316,000, respectively, related to amortization of debt discount.

On January 20, 2021, the Company borrowed $300,000 from JR on an unsecured basis. On the occurrence of the final closing of the proposed merger, the unpaid principal of the loan was applied to the consideration relating to the final close.

In March 2021, the Company and JR effected the second and final closing under the option, whereby JR acquired 18,225,000 shares of the Company’s common stock for aggregate consideration of $10,935,000, consisting of $10,635,000 in cash and $300,000 upon conversion of the principal amount of the promissory note issued in January 2021. The final closing increased JR’s common stock ownership above 50%.

Note 5 — Property and Equipment

As of December 31, 2021, and March 31, 2021, the Company’s property and equipment consists of the following:

	Estimated Useful Life (Years)	December 31, 2021			March 31, 2021
Land			$	70,000		$	70,000
Building	39			630,798			503,711
Furniture and equipment	3 – 5			621,862			330,125
Vehicles	5			154,952			—
				1,477,612			903,836
Less accumulated depreciation				(136,503)			(33,092)
Property and equipment, net			$	1,341,109		$	870,744

Depreciation expense for the three and nine months ended December 31, 2021, was $45,136 and $103,411, respectively. Depreciation expense for the three and nine months ended December 31, 2020, was $744 and $868, respectively.

Note 6 — Shareholders’ Equity

Common Stock

The Company’s authorized capital stock consists of 75,000,000 shares of common stock, with a par value of $0.001 per share, and 10,000,000 preferred shares with a par value of $0.001 per share.

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 6 — Shareholders’ Equity (continued)

On June 23, 2021, the Company issued 2,311,000 shares of common stock at a price of $4.50 per common share, for gross proceeds of $10,399,500 in connection with the initial tranche of a non-brokered private placement (“Private Placement”). On July 21, 2021, the Company issued 8,734,611 shares of common stock at a price of $4.50 per common share, for gross proceeds of $39,305,750 in connection with the second tranche of the non-brokered Private Placement. On August 2, 2021, the Company entered into a series of substantially similar subscription agreements, pursuant to which the Company issued and sold to certain investors, in the final tranche of the Private Placement, an aggregate of 120,550 common shares at a price of $4.50 per share, for gross proceeds of $542,475. In aggregate, the Company issued a total of 11,166,161 common shares for total gross proceeds of $50,247,725. Robert Quartermain, a director and Co-Chair of the Company, purchased 50,000 common shares in the Private Placement. The Company paid a total of $754,598 in share issuance costs related to the Private Placement.

During the nine months ended December 31, 2021, the Company also issued (i) 1,832,600 shares of common stock valued at $8,780,464 for investment in mineral properties (see Note 3 for additional discussion), (ii) 144,612 shares of common stock valued at $703,647 for settlements of debt (see Note 2 for additional discussion), and (iii) 1,450,000 shares of common stock valued at $7,177,500 to directors, employees and consultants to the Company and (iv) 37,500 shares of common stock for cash consideration of $22,500. During the nine months ended December 31, 2021, the Company recognized $7,177,500 of stock- based compensation ($1,361,250 being allocated to exploration costs and $5,816,250 being allocated to general and administrative expenses).

Of the 1,450,000 shares of common stock issued as share-based compensation, 400,000 shares vested on June 4, 2021, and the remaining 1,050,000 shares will vest on June 4, 2022. The share-based compensation expense on the unvested bonus shares is being amortized on a straight-line basis until the vest date.

During the nine months ended December 31, 2020, the Company issued (i)) 15,412,500 shares of common stock for $9,000,000; (ii) 1,987,500 shares of common stock for $631,000 upon the exercise of stock options and warrants; (iii) 1,051,467 shares upon cashless exercise of stock options and warrants; (iv) 750,000 shares of common stock valued at $1,320,000 for investment in mineral properties (see Note 4 for further discussion); and (v) 2,416,667 shares of common stock upon conversion of notes payable balances totaling $1,450,000 (See Note 2 for further discussion).

On November 13, 2020, the Company declared a special cash dividend of $0.22 per common share, totaling $4,357,246, to holders of record of 19,805,664 shares of common stock. Such dividend was paid in January 2021.

As of December 31, 2021, there were 70,828,204 shares of the Company’s common stock outstanding.

Common Stock Options, Restricted Stock Units and Warrants

On January 25, 2015, the Company’s board of directors adopted a plan entitled the “2015 Omnibus Incentive Plan.” The 2015 Omnibus Incentive Plan is no longer in effect and no further securities will be issued under the 2015 Omnibus Incentive Plan, other than in respect of 75,000 common stock purchase options that remain outstanding.

On March 11, 2021, the Company’s board of directors adopted a plan entitled the “2021 Stock Incentive Plan.” The 2021 Stock Incentive Plan has a total of 6,250,000 Common Shares available to award to the Company’s directors, executive officers and consultants. As of December 31, 2021, a total of 2,103,750 shares of the Company’s common stock remained available for future grants under the 2021 Stock Incentive Plan.

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 6 — Shareholders’ Equity (continued)

Outstanding stock options under the 2021 Stock Incentive Plan have a term of five years. Outstanding stock options granted to third-party service providers generally vest over a period of up to two years.

A summary of the Company’s stock option activity and related information for the period ended December 31, 2021, is as follows:

	Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Life (In Years)		Aggregate Intrinsic Value
Outstanding as of March 31, 2021		825,000		$	1.77		4.86		$	285,000
Options granted		2,571,250			4.77		4.46
Options forfeited/cancelled		(41,667)			2.63
Outstanding as of December 31, 2021		3,354,583		$	4.06		4.37		$	2,088,500
Options exercisable as of December 31, 2021		932,083		$	4.41		4.35

During the nine months ended December 31, 2021, the Company estimated the fair value of each stock option to have a weighted average grant date fair value of $2.90 per share on the date of grant using a Black Scholes valuation model. The weighted-average assumptions used to calculate the grant date fair value were as follows: (i) risk-free interest rate ranging from 0.39% — 1.28%, (ii) estimated volatility between 82.61% and 95.82%, (iii) dividend yield of 0%, and (iv) expected life of 4.08 to 5 years.

On October 18, 2021, the Company granted 300,000 stock options to an employee at an exercise price of $4.64 per option, with a grant date fair value of $3.31 per share and vesting over a period of 24 months. The share-based compensation expense for the stock options will be allocated to exploration expenses.

On September 13, 2021, the Company granted 200,000 stock options to certain directors at an exercise price of $5.09 per option, with a grant date fair value of $3.71 per share and vesting over a period of 24 months. The share-based compensation expense for the stock options will be allocated to general and administrative expenses.

On May 17, 2021, the Company granted 2,071,500 stock options to officers, directors and consultants at an exercise price of $4.76 per option, with a grant date fair value of $3.39 per share and vesting over a period of 24 months. The share-based compensation expense for the stock options will be allocated to general and administrative and exploration expenses.

The Company recognized stock-based compensation related to issuance of stock options totaling $6,025,440 ($1,574,372 being allocated to exploration costs and $4,451,068 being allocated to administrative expenses) during the nine months ended December 31, 2021. As of December 31, 2021, the unrecognized compensation cost related to unvested options was $3,608,802.

No stock-based compensation was recognized by the Company during the nine months ended December 31, 2020.

On June 4, 2021, the Company issued 1,050,000 restricted stock units (“RSU’s”) with a grant date fair value of $5.01 per share to certain directors, officers, employees and consultants and vesting on June 4, 2022.

On October 18, 2021, the Company issued 125,000 RSUs with a grant date fair value of $4.64 per share and vesting on June 4, 2022. The share-based compensation expense for the RSUs will be allocated to

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DAKOTA TERRITORY RESOURCES CORP

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
DECEMBER 31, 2021, and 2020
(UNAUDITED)

Note 6 — Shareholders’ Equity (continued)

exploration expenses. For the three months ended December 31, 2021, $187,424 was allocated to exploration expenses pursuant to these grants.

There were no warrants outstanding as of December 31, 2021, and March 31, 2021.

Note 7 — Fair Value Accounting

The carrying value of cash and accounts payable approximate fair value.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of
Dakota Territory Resource Corp.

Opinion on the Financial Statements

We have audited the accompanying balance sheets of Dakota Territory Resource Corp. (the “Company”) as of March 31, 2021 and 2020, and the related statements of operations, changes in shareholders’ equity (deficit), and cash flows for each of the years in the two-year period ended March 31, 2021, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the two-year period ended March 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Substantial Doubt About the Company’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has not generated any revenues since inception and has suffered recurring losses from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) represented especially challenging, subjective, or complex judgements. We determined that there are no critical audit matters.

/S/ HAM, LANGSTON & BREZINA, L.L.P.

We have served as the Company’s auditor since 2020.

Houston, Texas

June 25, 2021

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BALANCE SHEETS

	March 31, 2021			March 31, 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	10,392,940		$	146,425
Prepaid expenses and other current assets			75,608			7,649
Total current assets			10,468,548			154,074
Mineral properties, net			5,337,072			216,104
Property and equipment, net			870,744			—
TOTAL ASSETS		$	16,676,364		$	370,178
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities		$	162,024		$	501,818
Accounts payable – related party			3,000			1,790,829
Line of credit			—			30,082
Notes payable			—			300,000
Current portion of notes payable – related party			906,768			325,645
Total current liabilities			1,071,792			2,948,374
Notes payable – related party, net of current portion and discount			473,325			—
Total liabilities			1,545,117			2,948,374
SHAREHOLDERS’ EQUITY (DEFICIT)
Preferred stock, par value $0.001; 10,000,000 shares authorized, no shares issued and outstanding as of March 31, 2021 and March 31, 2020, respectively			—			—
Common stock, par value $0.001; 75,000,000 shares authorized, 56,197,331 and 16,354,197 shares issued and outstanding as of March 31, 2021 and March 31, 2020, respectively			56,197			16,354
Additional paid-in capital			23,617,834			2,783,193
Accumulated deficit			(8,542,784)			(5,377,743)
Total shareholders’ equity (deficit)			15,131,247			(2,578,196)
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	16,676,364		$	370,178

The accompanying notes are an integral part of these financial statements.

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STATEMENTS OF OPERATIONS
For the Years Ended March 31, 2021 and 2020

	2021			2020
OPERATING EXPENSES
Exploration costs		$	673,545		$	100,133
General and administrative expenses			1,160,979			1,001,339
Total operating expenses			1,834,524			1,101,472
LOSS FROM OPERATIONS			(1,834,524)			(1,101,472)
OTHER EXPENSE
Interest income			7,204			—
Interest expense			(1,337,721)			(12,801)
Total other expense			(1,330,517)			(12,801)
NET LOSS		$	(3,165,041)		$	(1,114,273)
Net loss per share:
Basic and diluted net loss per share		$	(0.12)		$	(0.07)
Weighted average shares outstanding:
Basic and diluted			25,904,749			16,054,675

The accompanying notes are an integral part of these financial statements.

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STATEMENTS OF CASH FLOWS
For the Years Ended March 31, 2021 and 2020

	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(3,165,041)		$	(1,114,273)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense			124,706			110,897
Common stock issued for services			—			85,000
Depreciation expense			17,554			—
Accretion of debt discount			1,331,121			—
Changes in current assets and liabilities:
Prepaid expenses and other assets			(67,959)			1,202
Accounts payable and accrued expenses			(257,626)			275,922
Accounts payable – related party			(422,000)			190,170
Net cash used in operating activities			(2,439,245)			(451,082)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment			(888,298)			—
Purchases of mineral properties			(3,800,968)			—
Net cash used in investing activities			(4,689,266)			—
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of cash dividend			(4,357,246)			—
Proceeds from note payable			1,450,000			300,000
Proceeds from sale of common stock			19,635,000			100,000
Proceeds from exercise of common stock options and warrants			1,011,000			50,000
Repayment of note payable – related party			(333,646)			—
Repayment of line of credit, net			(30,082)			(5,083)
Net cash provided by financing activities			17,375,026			444,917
NET CHANGE IN CASH AND CASH EQUIVALENTS			10,246,515			(6,165)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			146,425			152,590
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	10,392,940		$	146,425
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest expense		$	6,865		$	—
Cash paid for income taxes		$	—		$	—
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common stock issued for investment in mineral property		$	1,320,000		$	—
Common stock issued upon conversion of note payable		$	1,750,000		$	—
Related party accounts payable and accrued interest converted to related party note payable		$	1,447,997		$	—

The accompanying notes are an integral part of these financial statements.

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STATEMENTS OF CHANGES SHAREHOLDERS’ EQUITY (DEFICIT)
For the Years Ended March 31, 2021 and 2020

	Common Stock					Additional Paid-in Capital			Accumulated Deficit			Total
	Shares		Amount			Additional Paid-in Capital			Accumulated Deficit			Total
Balance March 31, 2019		15,729,197		$	15,729		$	2,437,921		$	(4,263,470)		$	(1,809,820)
Common stock issued for cash		250,000			250			99,750			—			100,000
Common stock issued for services		250,000			250			84,750			—			85,000
Stock options issued for services		—			—			110,897			—			110,897
Exercise of stock options		125,000			125			49,875			0			50,000
Net loss		—			—			—			(1,114,273)			(1,114,273)
Balance March 31, 2020		16,354,197			16,354			2,783,193			(5,377,743)			(2,578,196)
Common stock issued for cash		32,725,000			32,725			19,602,275			—			19,635,000
Common stock issued upon exercise of options		2,950,000			2,950			1,008,050			—			1,011,000
Common stock issued for investment in mineral properties		750,000			750			1,319,250			—			1,320,000
Debt discount assigned to purchase option		—			—			1,305,000			—			1,305,000
Cashless exercise of stock options and warrants		501,467			501			(501)			—			—
Common stock issued upon conversion of debt		2,916,667			2,917			1,747,083			—			1,750,000
Stock-based compensation expense		—			—			124,706			—			124,706
Debt discount on notes payable – related party		—			—			86,024			—			86,024
Cash dividend		—			—			(4,357,246)			—			(4,357,246)
Net loss		—			—			—			(3,165,041)			(3,165,041)
Balance at March 31, 2021		56,197,331		$	56,197		$	23,617,834		$	(8,542,784)		$	15,131,247

The accompanying notes are an integral part of these financial statements.

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 1 Organization and Nature of Business

Dakota Territory Resource Corp., (“the Company”) was incorporated in the State of Nevada on February 6, 2002, has been in the exploration stage since its formation, and has not realized any revenues to date from its properties. Our Company is engaged in the business of acquisition and exploration of mineral properties within the Homestake Gold District of the Black Hills of South Dakota. To date, while no development or mining activities have commenced, our strategy is to move projects from exploration to development and finally on to production as results of exploration may dictate. Dakota Territory’s management and technical teams have extensive mining and exploration experience in the Homestake District and we intend to leverage our experience together with our business presence in South Dakota to create value for our shareholders. The Company currently holds eight brownfield project areas in the district comprised of 976 unpatented claims and a combination of surface and mineral leases covering a total of approximately 19,604 acres. Our goal is to obtain sufficient capital to advance our current property portfolio, to fund acquisition of additional prospective mineral property, and for the general working capital needs of the Company.

In September 2012, the Company closed on the agreement with North Homestake Mining Company (“NHMC”) to exchange common stock to affect the acquisition of North Homestake’s gold exploration properties located in South Dakota. Since 2012, our Company has pursued a strategy of expanding our portfolio of brownfields exploration properties located exclusively within the Homestake District with the goal to build a dominant land position. Our property acquisitions have been based on our past exploration experiences, the extensive data sets we have assembled over the past 9 years, and new exploration and research the Company has conducted on the gold system that created the District. We have not established that any of our projects or properties contain any proven or probable reserves under SEC Industry Guide 7.

Uncertainties and Economic Development

The restrictions put in place by federal, state and local governments could delay our exploratory programs on our mineral properties. Furthermore, the impact of the pandemic on the global economy could also negatively impact the availability and cost of future borrowings should the need arise.

Going Concern

These financial statements have been prepared assuming that the Company will continue as a going concern. The Company has an accumulated deficit from inception through March 31, 2021 of approximately $8,543,000 and has yet to achieve profitable operations, and projects further losses in the development of its business.

The Company’s ability to continue as a going concern is dependent upon its ability to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. These financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that may be

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 1 Organization and Nature of Business (continued)

necessary should we be unable to continue as a going concern. We anticipate that additional funding will be in the form of equity financing from the sale of common stock, and/or debt financing. However, there can be no assurance that the issuances of additional equity securities or debt financing can be obtained.

Based on these factors, there is substantial doubt as to the Company’s ability to continue as a going concern.

Reverse Stock Split

On May 13, 2021, the Board of Directors of the Company approved a reverse stock split of the Company’s common stock at a ratio of 1-for-4. All share numbers and common stock prices presented give effect to the reverse split.

Note 2 Summary of Accounting Policies

Basis of Presentation

Our financial records are maintained on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of Estimates

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of demand deposits at commercial banks. The Company is exposed to credit risk from its deposits of cash and cash equivalents in excess of amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses on such deposits.

Property and Equipment

Mineral Property Costs

We have been in the exploration stage since inception and have not yet realized any revenues from our planned operations. All exploration expenditures are expensed as incurred. Costs of acquisition and option costs of mineral rights are capitalized upon acquisition. Mine development costs incurred to develop new ore deposits, to expand the capacity of mines, or to develop mine areas substantially in advance of current production are also capitalized once proven and probable reserves exist and the property is a commercially mineable property. Costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations. If we do not continue with exploration after the completion of the feasibility study, the associated capitalized costs will be expensed at that time. Costs of abandoned projects are charged to mining costs including related property and equipment costs.

To determine if the capitalized mineral property costs are in excess of their recoverable amount, we conduct periodic evaluation of the carrying value of capitalized costs and any related property and equipment

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 2 Summary of Accounting Policies (continued)

costs based upon expected future cash flows and/or estimated salvage value in accordance with Accounting Standards Codification (ASC) 360-10-35-15, Impairment or Disposal of Long-Lived Assets.

Fair Value Measurements

We account for assets and liabilities measured at fair value in accordance with ASC 820, Fair Value Measurements and Disclosures. ASC 820 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).The three levels of inputs used to measure fair value are as follows:

•

Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets.

•

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

•

Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value.

Our financial instruments consist principally of cash, accounts payable, accrued liabilities and notes payable. The carrying amounts of such financial instruments in the accompanying financial statements approximate their fair values due to their relatively short-term nature or the underlying terms are consistent with market terms.

Environmental Costs

Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue general, are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable, and the cost can be reasonably estimated. Generally, the timing of these accruals coincides with the earlier of completion of a feasibility study or the Company’s commitments to plan of action based on the then known facts.

Income Taxes

The Company recognizes and measures a tax benefit from uncertain tax positions when it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company recognizes a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company adjusts these liabilities when its judgement changes as a result of the evaluation of new information not previously available. Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 2 Summary of Accounting Policies (continued)

materially different from the current estimate or future recognition of an unrecognized tax benefit. These differences will be reflected as increases or decreases to income tax expense in the period in which they are determined.

The Company recognizes interest and penalties related to unrecognized tax positions within the income tax expense line in the statements of operations.

Basic and Diluted Loss Per Share

The Company computes basic and diluted income (loss) per share amounts pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic loss per share is computed by dividing net income (loss) available to common shareholders, by the weighted average number of shares of common stock outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted income (loss) per share is computed by dividing net income (loss) available to common shareholders by the diluted weighted average number of shares of common stock during the period. The diluted weighted average number of common shares outstanding is the basic weighted number of shares adjusted for the dilutive effect of potential future issuances of common stock related to outstanding options and warrants.

The dilutive effect of outstanding options and warrants is reflected in diluted earnings per share by application of the treasury stock method. The effect of the Company’s outstanding options and warrants were excluded for the years ended March 31, 2021 and 2020, because they were anti-dilutive.

Stock-Based Compensation

The Company estimates the fair value of share-based compensation using the Black-Scholes valuation model, in accordance with the provisions of ASC 718, Compensation — Stock Compensation. Key inputs and assumptions used to estimate the fair value of stock options include the grant price of the award, the expected option term, volatility of our stock, the risk-free rate, and dividend yield. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by the option holders, and subsequent events are not indicative of the reasonableness of the original estimates of fair value made by the Company.

Recent Accounting Pronouncements

Pronouncements between March 31, 2021 and the date of this filing are not expected to have a significant impact on our operations, financial position, or cash flow, nor does the Company expect the adoption of recently issued, but not yet effective, accounting pronouncements to have a significant impact on our results of operations, financial position or cash flows.

Note 3 Related Party Transactions

Mr. Gerald Aberle is the Company’s former President, Chief Executive Officer and is Chief Operating Officer of the Company. He is also a director and significant shareholder of the Company and the owner of Jerikodie, Inc. Under a February 2012 agreement, Jerikodie Inc. earns a fixed consulting fee of $9,000 per month, plus approved expenses. In October 2020, the Company paid Jerikodie, Inc, $200,000 of the approximate $729,500 owed to it for consulting fees and issued a note payable to Jerikodie for the remaining balance of approximately $529,500 bearing interest at 0.25% per year. On June 1, 2021 the Company and Jerikodie settled debt of $529,500 through the payment of $376,550 and the issuance of 45,563 shares of common stock. During the year ended March 31, 2021, the Company engaged a Company controlled by a family member of Mr. Aberle, for the purpose of providing general labor and incurred approximately $37,000 in costs.

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 3 Related Party Transactions (continued)

As of March 31, 2020, the Company owed Mr. Aberle, individually, $20,500 in unsecured loans. These unsecured loans bear interest of 3% per year and are due on demand. In July 2020, Mr. Aberle was paid in full for these unsecured loans and related accrued interest of $770.

Mr. Richard Bachman is the Company’s former Chief Geological Officer (“CGO”). He is also a director and significant shareholder of the Company and the owner of Minera Teles Pires Inc. (“Minera Teles”). Under an October 2005 agreement that expired in March 2020, Minera Teles earned a $10,000 monthly consulting fee and received $1,500 per month for office rent and expenses. The consulting fee was divided between a $5,000 per month cash payment and a $5,000 per month deferred amount. The Company also owed Mr. Bachman, individually, $305,145 in unsecured loans. These unsecured loans bear interest at rates ranging from 3% to 4% per year and are due on demand. In June 2020, the Company repaid $40,145 of unsecured loans, plus accrued interest totaling $6,095. In October 2020, the Company paid Minera Teles $200,000 for amounts owed for prior services and combined the remaining amount owed of approximately $795,500 with amounts owed under the unsecured loans, including unpaid interest, into a new note in the amount of $1,055,310, bearing interest at 0.25% per year. A payment of $145,000 was made in December 2020. As of March 31, 2021, the unpaid principal balance totalled $910,454.

In October 2020, the Company issued a note payable to WCM Associates, LP, an entity controlled by the Company’s CFO, in the amount of $123,000, bearing interest at 0.25% per year, for amounts owed for consulting fees. As of the date of this filing, the note has been paid in full.

In connection with the notes payable issued in 2020, as discussed above, the Company determined that the 0.25% contractual rate represents a below-market interest rate. Interest was imputed on the notes payable at 5.00% interest resulting in a discount at issuance of $86,024. During year ended March 31, 2021, the Company recognized amortization of the debt discount of $26,121 in interest expense, with the remaining unamortized discount to be recognized into interest expense over the remaining life of the notes using the effective interest method.

In September 2018, Mr. Stephen O’Rourke, a director of the Company, through his consulting firm, entered into a one-year consulting agreement with the Company whereby he was issued a consulting fee of 250,000 shares valued at $85,000, or $0.34 per share, for services rendered. In September 2019, Mr. O’Rourke was issued a five-year option to purchase 250,000 shares of our common stock at an exercise price of $0.32 per share. Mr. O’Rourke exercised these options for cash in October 2020.

In October and December 2020, options to purchase 1,075,000 shares of common stock were exercised for $344,000 by our officers and directors. Messrs. Aberle and Bachman own a 5% net smelter return royalty on the original 84 unpatented mining claims that comprised the Blind Gold Property. On June 1, 2021 the Company and Jerikodie settled debt of $529,500 through the payment of $376,550 and the issuance of 45,563 shares of common stock.

Note 4 Mineral Properties

On September 26, 2012, the Company was re-organized with North Homestake Mining Company.

With this re-organization, the Company acquired 84 unpatented lode mining claims covering approximately 1,600 acres known as the Blind Gold Property located in the Black Hills of South Dakota.

On December 28, 2012, the Company acquired 57 unpatented lode mining claims covering approximately 853 acres known as the West False Bottom Creek and Paradise Gulch Claim Group, the City Creek Claims Group, and the Homestake Paleoplacer Claims Group, all located in the Black Hills of

South Dakota. The West False Bottom Creek and Paradise Gulch Claims were contiguous to the Blind Gold Property and have been incorporated into the Blind Gold Property. The purchase price was 250,000 restricted common shares valued at $0.60 per share, or $150,000.

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 4 Mineral Properties (continued)

On February 24, 2014 the Company acquired surface and mineral title to the 26.16 acres of the Squaw and Rubber Neck Lodes that comprise Mineral Survey 1706 in the Black Hills of South Dakota. The Company is required to make annual lease payments of $8,000 for a period of 5 years, of which $8,000 was due upon execution of the agreement. On May 7, 2019, the Company extended the lease with option to purchase agreement for Mineral Survey 1706 for an additional 5-year period. The property is part of the Homestake Paleoplacer Property, and the Company has maintained the option to purchase the mineral property for $150,000.

On March 3, 2014, the Company completed the acquisition of approximately 565.24 mineral acres in the Northern Black Hills of South Dakota. The acquisition increased our mineral interests in the Homestake District by nearly 23%, to over 3,057 acres. As part of the property acquisition, the Company purchased an additional 64.39 mineral acres located immediately southwest and contiguous to our Paleoplacer Property, including mineral title to the historic Gustin, Minerva and Deadbroke Gold Mines. The purchase price of the mineral interests was $33,335.

On April 5, 2017 the Company acquired options to purchase a combination of surface and mineral titles to approximately 293 acres in the Homestake District of the Northern Black Hills of South Dakota. The acquisition included 61 acres located immediately south and contiguous with our City Creek Property; 82 acres located approximately one half mile south of our Blind Gold Property at the western fringe of the historic Maitland Gold Mine; and 141 acres located immediately north and contiguous to our Homestake Paleoplacer Property. The Company is required to make annual lease payments totaling $20,000 for a period of 5 years, of which $20,000 was due upon execution of the agreement. The Company has an option to purchase the mineral properties for total price of $626,392. As of March 31, 2021 the Company is current on all required annual lease payments.

In November 2018, we acquired 42 unpatented lode mining claims covering approximately 718 acres located immediately to the north and adjacent to the Company’s City Creek Property. Through this staking, the City Creek project area was expanded from approximately 449 acres to 1,106 acres.

In September 2019 the Company completed the acquisition of 106 unpatented lode mining claims covering approximately 1,167 acres in close proximity to the historic Tinton Gold Camp. The Tinton area was the site of placer mining activity between 1876 and the turn of the century.

On March 6, 2020 the Company completed the acquisition of 65 unpatented lode mining claims covering approximately 1,152 acres in the Homestake District of the Black Hills of South Dakota. The new property is contiguous to the Company’s Blind Gold Property.

In May 2020 the Company acquired 67 unpatented lode mining claims covering approximately 1,045 acres located on the western margin of the structural corridor that extends north of the Homestake Gold Mine. The West Corridor property is located just south of the mineral property Dakota Territory acquired from Deadbroke Mining Company in March of 2014, just north of the producing Wharf Mine (Coeur Mining) and just to the south and east of the former Richmond Hill Mine (Barrick Gold).

In July 2020 the Company acquired 166 unpatented lode mining claims covering approximately 3,152 acres located immediately north and adjacent to the Company’s City Creek Property. Through this staking, the City Creek project area was expanded from approximately 1,176 acres to 4,319 acres. The City Creek Property is comprised of a combination of patented and unpatented mining claims covering the continuous extension of the iron-formation gold host northeast of the Homestake Mine. The City Creek geology is dominated by the Homestake, Ellison and Poorman stratigraphic sequence that has been delineated by more than 40,000 ft of core drilling across the property. The historic drilling also documents the occurrence of gold mineralization in the classic quartz vein, chlorite-arsenopyrite style of the Homestake Mine.

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NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 4 Mineral Properties (continued)

On September 15, 2020 we completed the acquisition of 50 unpatented lode mining claims covering approximately 840 acres at the historic Ragged Top Gold Camp of the Black Hills of South Dakota. Tertiary- aged gold mineralization in the Ragged Top area is hosted primarily in the Paha Sapa Limestone formation and has been mined from both vertical fissures called “Verticals” and from collapsed breccias. The Ragged Top acquisition is located just northwest of the producing Wharf Mine (Coeur Mining) and approximately 3 miles southwest of the former Richmond Hill Mine (Barrick Gold).

On October 26, 2020, the Company completed the purchase of the Maitland Gold Property from Homestake Mining Company of California, a wholly owned subsidiary of Barrick Gold Corporation (“Barrick”). At closing, the Company paid Barrick $3.5 million cash and issued 750,000 shares of its common stock valued at $1.76 per share, for total consideration of $4.82 million. Additionally, Barrick retained a 2.5% net smelter returns royalty on the property. The 2,112 mineral-acre Maitland acquisition is an important component of Dakota Territory’s exploration and development strategy for the structural corridor that extends from the Homestake Gold Mine to the Company’s Blind Gold Property at the northern end of the Homestake District.

On November 25, 2020 the Company acquired 64 unpatented lode mining claims covering approximately 1,092 acres located south and to the west of the former Homestake Gold Mine at Lead, South Dakota. The Poorman Anticline geological structure is the southwestern-most known extension of the Homestake iron- formation host in the district. Gold mineralization was discovered underground on the 2600 and 4100 foot levels in the far western extents of the Homestake Mine in the 1950’s and 60’s with little historic follow-up exploration in the Poorman Anticline closer to surface. Dakota Territory’s targeting in the Poorman Anticline is based on the presence of the Homestake iron-formation host and projected intersections with important shear fabric that is known to have conducted fluids necessary to the deposition of gold mineralization in the northern extents of the structural corridor.

On January 26, 2021 the Company acquired 143 unpatented lode mining claims covering approximately 2,468 acres. The acquisition was based on continuing analysis of the Company’s historic data sets coupled with new insights derived from the Company’s district-scale airborne geophysical survey flown during the summer of 2020 and increased the acreage covered by three of the Company’s existing project areas. At the west side of the Homestake District, the Tinton property was extended to the north and northwest adding approximately 1,966 acres to the original claim block. In the central region of the District, the West Corridor property was extended west to Cleopatra Creek covering approximately 242 additional acres between Richmond Hill and Wharf gold mines, and the Blind Gold Property was expanded west adding approximately 260 acres immediately north of the Richmond Hill Mine.

On March 8, 2021 the Company acquired 39 unpatented lode mining claims covering approximately 806.5 at the eastern boundary of the Company’s Tinton Property. Tinton was the site of placer mining activity between 1876 and the turn of the century, the lode source for which has not been discovered. Our original Tinton claim block was located based on historic research and exploration conducted by members of our technical team at Homestake Mining Company in the 1980’s and 1990’s, which suggested a Pre-Cambrian lode source at depth. The latest property acquisition is focussed on additional younger Tertiary- aged gold mineralization in the younger sedimentary and igneous rocks covering the property.

On March 9, 2021 Dakota Territory acquired, by option, 25 patented mining claims covering approximately 307 acres at the eastern boundary of the northern segment of the Company’s Ragged Top Property. The property was acquired from Donald Valentine of Steamboat Springs, Colorado. Two additional unpatented lode claims covering approximately 29 acres were also acquired by staking and added at the north end of the property. The Ragged Top Property has been subject to historic mining operations producing Tertiary-aged gold and silver mineralization primarily from vertical fissures and collapsed breccias within

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 4 Mineral Properties (continued)

the Paha Sapa limestone unit. The Ragged Top property is located just northwest of the producing Wharf Mine (Coeur Mining) and approximately 3 miles southwest of the former Richmond Hill Mine (Barrick Gold).

As of March 31, 2021 and 2020, the Company’s mineral properties totaled $5,337,072 and $216,104, respectively. As of March 31, 2021, the Company is in the exploration stage and has not commenced amortization of its properties.

Note 5 Property and Equipment

As of March 31, 2021 and 2020, the Company’s property and equipment consists of the following:

	Estimated Useful Life (Years)	2021			2020
Land			$	70,000		$	—
Building	39			503,711			—
Furniture and equipment	3 – 5			330,125			15,538
				903,836			15,538
Less accumulated depreciation				(33,092)			(15,538)
Property and equipment, net			$	870,744		$	—

Depreciation expense for the year ended March 31, 2021 was $17,554.

Note 6 Income Taxes

The following table sets forth a reconciliation of the statutory federal income tax for the years ended March 31:

	2021			2020
Income tax benefit computed at federal statutory rates		$	664,659		$	233,997
Non-deductible stock-based compensation			(26,188)			(41,138)
Non-deductible interest expense			(279,536)
Change in valuation allowance			(358,935)			(192,859)
Tax benefit		$	—		$	—

In order to comply with generally accepted accounting principles in the United States of America, management has decided to establish a valuation allowance because of the potential that the tax benefits underlying the deferred tax asset may not be realized. Significant components of our deferred tax asset as of March 31 are as follows:

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 6 Income Taxes (continued)

	2021			2020
Deferred tax assets: Net operating loss carry forward		$	1,124,389		$	703,077
Basis of mining properties			32,235			32,235
Less: valuation allowance			(1,094,247)			(735,312)
Total deferred tax assets			62,377			—
Basis in property and equipment			(62,377)			—
Net deferred tax assets		$	—		$	—

As a result of a change in control effective in October 2020, our net operating losses prior to that date may be partially or entirely unavailable, by law, to offset future income and, accordingly, are excluded from the associated deferred tax asset.

The net operating loss carry forward in the approximate amount of $5,354,333 will begin to expire in 2027. We file income tax returns in the United States and in one state jurisdiction.

We follow the provisions of ASC 740 relating to uncertain tax provisions and have commenced analyzing filing positions in all of the federal and state jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. There are no unrecognized tax benefits as of March 31, 2021 or March 31, 2020. The Company files income tax returns in the U.S. federal jurisdiction and in certain state jurisdictions. The Company has not been subjected to tax examinations for any year and the statute of limitations has not expired. The Company’s tax returns remain open for examination by the applicable authorities, generally 3 years for federal and 4 years for state.

Note 7 Notes Payable

JR Resources Corp.

In February 2020, we entered into a $300,000 unsecured promissory note agreement with JR Resources Corp. (“JR”). The note bore interest at 3.0% per year and was due on May 5, 2021. In May 2020, JR and the Company entered into an amended and restated promissory note in the amount of $1,450,000, which includes the $300,000 that was advanced in February 2020 and an additional $1,150,000 that was advanced in May 2020. The amended and restated unsecured note bears interest at 0.25% per year, compounded annually, and matures on December 31, 2021. At maturity, the principal amount of the note, together with any accrued but unpaid interest, will be due and payable in cash, provided that, if and to the extent the Company does not pay this note in cash on the maturity date, then JR will be required to exercise, and will in fact be deemed to have exercised, its right to convert such unpaid portion of the note into shares of Company common stock. The conversion price is $0.60 per share through December 31, 2020 and, thereafter, the lesser of $0.60 per share on the volume weighted average price of Company common stock for the five consecutive trading days immediately preceding the date of such conversion (with a floor of $0.40 per share). The note has customary event of default provisions and, upon an event of default, JR will be required to convert the unpaid portion of the note into the shares of Company common stock, if not paid in cash by the Company.

In connection with the promissory note agreement with JR, the Company granted JR an option to purchase up to 35,641,667 shares of common stock at $0.60 per share in one or more closings on or prior to October 15, 2020. The proceeds from the debt issuance were allocated between the debt instrument and the purchase option based on their estimated relative fair values resulting in $1,305,000 of the total proceeds being allocated to the purchase option and recognized through a charge to additional paid-in capital with

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 7 Notes Payable (continued)

a corresponding discount on the debt. The debt discount will be amortized to interest expense over the remaining life of the note using the effective interest method.

On October 15, 2020, and as a part of the first closing of our agreement with JR Resources, the promissory note was converted into 2,416,667 shares of the Company’s common stock. In connection with the conversion, the Company recognized the remaining $1,036,849 of unamortized debt discount as interest expense. For the year ended March 31, 2021, the Company recognized additional interest expense of $1,305,000 related to amortization of the debt discount.

On January 20, 2021 JR lent the Company $300,000, on an unsecured basis. On the occurrence of the final closing, the unpaid principle of the loan would be applied to the consideration relating to the final close.

In March 2021, the Company and JR effected the second and final closing under the option, whereby JR acquired 18,225,000 shares of Company common stock for aggregate consideration of $10,935,000, $10,635,000 in cash and $300,000 upon conversion of the principal amount of a promissory note issued in January 2021. The final closing resulted in a change in control of the Company to JR Resources.

Note 8 Line of Credit

The Company has a line of credit with Wells Fargo Bank in California. The line of credit allows the Company to borrow up to $47,500. The Line of Credit bears interest at 7.75% per annum, is unsecured, and due on demand. The balance on this line of credit as of March 31, 2021 and 2020 was $0 and $30,082, respectively.

Note 9 Shareholders’ Equity

Common Stock

Our authorized capital stock consists of 75,000,000 shares of common stock, with a par value of $0.001 per share, and 10,000,000 preferred shares with a par value of $0.001 per share.

During the year ended March 31, 2021, the Company issued (i)) 32,725,000 shares of common stock for $19,635,000; (iii) 2,950,000 shares of common stock for $1,011,000 upon the exercise of stock options and warrants; (iv) 501,467 shares upon cashless exercise of stock options and warrants; (v) 750,000 shares of common stock valued at $1,320,000 for investment in mineral properties (see Note 4 for further discussion); and (vi) 2,916,667 shares of common stock upon conversion of notes payable balances totaling $1,750,000 (See Note 7 for further discussion).

During the year ended March 31, 2020, the Company issued (i) an aggregate of 250,000 shares of common stock for $100,000, (ii) 125,000 shares for $50,000 upon the exercise of stock options, and (iii) 250,000 shares of common stock valued at $85,000 in exchange for consulting services. The Company also issued options and warrants to purchase an aggregate of 800,000 shares of common stock at exercise prices ranging between $0.32 and $0.40 per share, expiring through January 2025.

Dividends

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 9 Shareholders’ Equity (continued)

JR Resources Option

In connection with the May 2020 promissory note agreement between the Company and JR, as further described in Note 7 above, the Company provided JR the option to acquire up to 35,641,667 shares of common stock at an exercise price of $0.60 per share. JR exercised the option in two closings occurring in October 2020 and March 2021. Upon the first closing in October 2020, JR acquired 17,416,667 shares of Company common stock for aggregate consideration of $10,450,000, $9,000,000 in cash and $1,450,000 upon conversion of the principal amount of the May 2020 promissory note. In March 2021, the Company and JR effected the second and final closing under the option, whereby JR acquired 18,225,000 shares of Company common stock for aggregate consideration of $10,935,000, $10,635,000 in cash and $300,000 upon conversion of the principal amount of a promissory note issued in January 2021. The final closing resulted in a change in control of the Company to JR Resources.

Common Stock Options and Warrants

The Company’s 2015 Omnibus Incentive Plan (the “Omnibus Plan”) authorizes the Company to grant or issue non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, cash-based awards or other stock-based awards up to a total of 3,750,000 shares. Under the terms of the Omnibus Plan, awards may be granted to employees, directors and third-party service providers. Awards issued under the Omnibus Plan vest as determined by the board of directors at the time of grant. Any shares related to an award granted under the Omnibus Plan that terminates by expiration, forfeiture, or otherwise without the issuance of the shares shall be available again for grant under the Omnibus Plan. As of March 31, 2021, a total of 1,087,500 shares remained available for future grants under the Omnibus Plan.

Outstanding stock options under the Omnibus Plan have terms ranging from 5 to 10 years. Outstanding stock options granted to third-party service providers generally vest over the period of the contract, which is typically one year. The Company recognized stock-based compensation related to issuance of stock options totaling $124,706 and $110,897 during the years ended March 31, 2021 and 2020, respectively, which is included in general and administrative expenses in the accompanying statements of operations. A summary of the Company’s stock option activity and related information for the period ended March 31, 2021 is as follows:

	Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Life (In Years)		Aggregate Intrinsic Value
Outstanding as of March 31, 2020		2,662,500		$	0.32		4.78		$	1,025,000
Options granted		750,000			1.92		4.96
Options exercised		(2,587,500)			0.32		—			—
Outstanding as of March 31, 2021		825,000			1.77		4.86			285,000
Options vested or expected to vest as of March 31, 2021		75,000			0.32		3.84			135,000
Options exercisable as of March 31, 2021		75,000		$	0.32		3.84		$	135,000

During the year ended March 31, 2021, we estimated the fair value of each stock option on the date of grant using a Black Scholes valuation model. The weighted-average assumptions used to calculate the grant date fair value were as follows: (i) risk-free interest rate of 1.52%, (ii) estimated volatility of 80%, (iii) dividend yield of 0%, and (iv) expected life of 5 years.

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 9 Shareholders’ Equity (continued)

A summary of the Company’s stock warrant activity and related information for the period ended March 31, 2021 is as follows:

	Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Life (In Years)
Outstanding as of March 31, 2020		825,000		$	0.40		1.99
Warrants granted		—			—		—
Warrants exercised		825,000			0.40		—
Outstanding as of March 31, 2021		—			—		—

Note 10 Subsequent Events

On May 14, 2021, the Company announced it had entered into a definitive merger agreement (the “Merger Agreement”) with JR.

Pursuant to the Merger Agreement, JR and the Company have incorporated a new company (“NewCo”) that will acquire all of the outstanding securities of JR and of the Company in exchange for securities of NewCo (the “Merger”). Shareholders of JR will receive a number of NewCo shares of common stock equal to their percentage shareholding in JR multiplied by the 35,641,667 Dakota Territory shares that JR owns. Shareholders of the Company other than JR will receive one share of common stock of NewCo for each share of common stock of the Company.

In addition, at the closing of the Merger, (i) each outstanding option to purchase Dakota Territory common stock, whether vested or unvested, will be assumed and converted into an option with respect to a number of shares of NewCo common stock in the manner set forth in the Merger Agreement, (ii) each outstanding warrant to purchase JR common stock, whether or not exercisable, will be assumed and converted into a warrant with respect to a number of shares of NewCo common stock in the manner set forth in the Merger Agreement, (iii) any outstanding awards of restricted stock units with respect to shares of Dakota Territory common stock will be assumed and converted into the right to receive an award of restricted stock units representing a right to receive a number of shares of NewCo common stock in the manner set forth in the Merger Agreement and (iv) NewCo will change its name to “Dakota Gold Corp.”

The completion of the Merger is subject to customary closing conditions for a transaction of this nature, including securities law compliance, the approval of JR shareholders and the approval of Dakota Territory shareholders. In addition, in connection with the Merger, the Company and JR intend to cause NewCo to prepare and file a registration statement on Form S-4 with the U.S. Securities and Exchange Commission (“SEC”).

On May 21, 2021 a purchase of surface and mineral title to approximately 213 acres located contiguous to the northwest boundary of the Company’s West Corridor Property. The property is also located is located just south of the mineral property Dakota Territory acquired from Deadbroke Mining Company in the Maitland Area in March of 2014, just north of the producing Wharf Mine (Coeur Mining) and just to the south and east of the former Richmond Hill Mine (Barrick Gold). The purchased property is subject to a 2% NSR Royalty held by Homestake Mining Company of California and a buyback right for 51% interest in

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DAKOTA TERRITORY RESOURCE CORP.

NOTES TO FINANCIAL STATEMENTS
For the Years Ended March 31, 2021 and 2020

Note 10 Subsequent Events (continued)

the property subject to, among other provisions, the establishment of a 1,000,000-ounce reserve and/or inferred resource from one or more deposits located within a one-kilometer area of influence surrounding the property.

On June 4, 2021 the Company issued 1,450,000 shares of common stock and 1,050,000 restricted share units to certain directors, officers, employees and consultants. On March 15, 2021, 750,000 options were granted, on May 17, 2021, 2,071,250 options were granted, resulting in a total of 2,896,250 options outstanding as of June 4, 2021.

On June 15, 2021 the Company announced its intention to complete a non-brokered private placement of up to 5,555,556 shares of common stock of the Company at a price of $4.50 per Common Share for aggregate gross proceeds of up to $25 million pursuant to an exemption from the registration requirements under the Securities Act of 1933, as amended (the “Securities Act”).

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth the estimated expenses to be borne by the Registrant in connection with the issuance and distribution of the shares of common stock being registered hereby.

Securities and Exchange Commission registration fee	$	1,468.43
Accounting fees and expenses		15,000
Legal fees and expenses		35,000
Financial printing and miscellaneous expenses		2,000
Total		53,468.43

Item 14. Indemnification of Directors and Officers.

The Registrant is a Nevada corporation.

Section 78.7502 of the Nevada Revised Statutes provides that a Nevada corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed proceeding, except an action by or in the right of the corporation, by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with the proceeding, if such person: (i) is not liable for breach of his or her fiduciary duties to the corporation; or (ii) acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.

In addition, a Nevada corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise against expenses, including amounts paid in settlement and attorneys’ fees actually and reasonably incurred by such person in connection with the defense or settlement of the action, if he or she: (i) is not liable for breach of his or her fiduciary duties to the corporation; or (ii) acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation.

Under Nevada law, indemnification may not be made for any claim as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals therefrom, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that a court of competent jurisdiction determines that in view of all the circumstances of the case, the person is fairly and reasonably titled to indemnity for such expenses as the court deems proper.

To the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any non-derivative proceeding or any derivative proceeding, or in defense of any claim, issue or matter therein, the corporation shall indemnify such person against expenses, including attorneys’ fees, actually and reasonably incurred in connection with the defense.

Further, Nevada law permits a Nevada corporation to purchase and maintain insurance or to make other financial arrangements on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise for any liability asserted against him or her and liability and expenses incurred by him or her in his or her capacity as a director, officer, employee or agent, or arising

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out of his or her status as such, whether or not the corporation has the authority to indemnify such person against such liability and expenses.

Under the Registrant’s Amended and Restated Bylaws, the Registrant is obligated to indemnify any director, officer, employee or agent of the Registrant to the fullest extent permitted by the Nevada Revised Statutes, as described above. The Registrant’s Amended and Restated Bylaws also require the Registrant to advance costs, charges and expenses, including attorneys’ fees, incurred by a director or officer in defending a civil proceeding in advance of the final disposition of such proceeding, if the officer or director provides the Registrant with an undertaking to repay all amounts advanced if it is ultimately determined that the person is not titled to be indemnified by the Registrant.

Item 15. Recent Sales of Unregistered Securities.

The following discussion is presented after giving effect to the Company’s 1 for 35,641,667 / 49,398,602 reverse stock split, which was completed on March 8, 2022. All of the securities described below were issued pursuant to private placements in compliance with Rule 506(c) of the Securities Act.

During the year ended March 31, 2020, the Company issued 20,486,566 shares of common stock at a weighted average price of $0.06 for proceeds of $1,219,843.

During the year ended March 31, 2021, the Company issued 5,632,601 shares of common stock at a weighted average price of $0.37 for proceeds of $2,126,387, and 14,722,397 units at a price of $1.39 for proceeds of $20,405,269. Each unit consists of one share of the Company’s common stock (14,722,397 total shares) and one-half of one warrant (7,363,193 total warrants). Each whole warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period expiring on March 15, 2026. In connection with such private placements, the Company incurred expenses of $94,839.

During the nine months ended December 31, 2021, the Company issued 505,058 units at a price of $1.39 for proceeds of $700,000. Each unit consists of one share of the Company’s common stock (505,058 total shares) and one-half of one warrant (252,529 total warrants). Each whole warrant entitles the holder thereof to purchase, upon exercise, one share of the Company’s common stock for $2.08 per share for a period expiring on March 15, 2026. In connection with the such private placements, the Company incurred aggregate expenses of $335,800.

Item 16. Exhibits and Financial Statement Schedules.

(a)

Exhibits.

See the Exhibit Index attached to this registration statement, which is incorporated by reference herein.

(b)

Financial Statements Schedules.

No financial statement schedules are provided because the information called for is not required or is shown in the consolidated financial statements or related notes.

Item 17. Undertakings.

(a)

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered)

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and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement);

(iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment will be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time will be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability of the Registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned Registrant undertakes that in a primary offering of securities of the Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424;

(ii) any free writing prospectus relating to the offering prepared by or on behalf of such Registrant or used or referred to by the undersigned Registrant;

(iii) the portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or their securities provided by or on behalf of such Registrant; and

(iv) any other communication that is an offer in the offering made by such Registrant to the purchaser.

(5) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.

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EXHIBIT INDEX

	Exhibit Number			Exhibit Description
	2.1*			Amended and Restated Agreement and Plan of Merger among Dakota Territory Resource Corp., DGC Merger Sub I Inc., DGC Merger Sub II LLC and the Registrant, dated September 10, 2021 (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	2.2*			Amendment to Agreement and Plan of Merger among Dakota Territory Resource Corp., the Registrant, DGC Merger Sub I Inc. and DGC Merger Sub II LLC, dated December 17, 2021 (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	3.1*			Articles of Incorporation of the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-1, filed March 28, 2022).
	3.2*			Certificate of Change Pursuant to NRS 78,209 to Articles of Incorporation of the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-1, filed March 28, 2022).
	3.3*			Certificate of Amendment to Articles of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 of the Registrant’s Current Report on Form 8-K, filed April 5, 2022).
	3.4*			Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 of the Registrant’s Current Report on Form 8-K, filed April 5, 2022).
	4.1+			Form of Common Stock Warrant of the Registrant.
	5.1+			Opinion of Erwin Thompson Faillers.
	10.1*			Agreement, dated May 26, 2020, between Dakota Territory Resource Corp. and the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.2*			Amending Agreement, dated October 15, 2020, between Dakota Territory Resource Corp. and the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.3*			Amending Agreement #2, dated February 15, 2021, between Dakota Territory Resource Corp. and the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.4*			Amending Agreement #3, dated March 12, 2021, between Dakota Territory Resource Corp. and the Registrant (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.5*			Form of Non-Brokered Subscription Agreement for Subscription Receipts (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.6*			Option Agreement for Purchase and Sale of Real Property dated October 14, 2021 between Homestake Mining Company of California, LAC Minerals (USA) LLC and Dakota Territory Resource Corp. (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	10.7*			Option Agreement for Purchase and Sale of Real Property dated September 7, 2021 between Homestake Mining Company of California and Dakota Territory Resource Corp. (incorporated by reference to the Registrant’s Registration Statement on Form S-4, filed February 1, 2022).
	21.1+			Subsidiaries of the Registrant.

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	Exhibit Number			Exhibit Description
	23.1+			Consent of Erwin Thompson Faillers (included in Exhibit 5.1 hereto).
	23.2+			Consent of Ham, Langston & Brezina, L.L.P., independent registered public accounting firm of Dakota Territory Resource Corp.
	23.3+			Consent of Ham, Langston & Brezina, L.L.P., independent registered public accounting firm of the Registrant.
	24.1*			Powers of Attorney (see the signature page to the Registrant’s Registration Statement on Form S-1, filed March 28, 2022).
	107*			Filing Fee Table (incorporated by reference to the Registrant’s Registration Statement on Form S-1, filed March 28, 2022).

Filed herewith.

Previously filed.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Vancouver, Province of British Columbia, Canada, on May 6, 2022.

DAKOTA GOLD CORP.

By:

/s/ Jonathan Awde

Jonathan Awde
Chief Executive Officer (Principal
Executive Officer) and Director

Warrant Shares: ______________	Issue Date: [___], 2022
	Initial Exercise Date: As defined herein

Name:
		(Please Print)
Address:
		(Please Print)
Phone Number:
Email Address:
Dated: _______________ __, ______
Holder's Signature:
Holder's Address:
(Signature Guaranteed):	Date:
	,

241 RIDGE STREET, SUITE 210	OFFICE (775) 786-9494
RENO, NEVADA 89501	DIRECT (775) 825-4300
	FAX (775) 786-1180
THOMAS P. ERWIN
FRANK W. THOMPSON	jfaillers@renolaw.com
JEFF N. FAILLERS	renolaw.com

Dakota Gold Corp.
1588-609 Granville Street
Vancouver, BC V7Y 1G5

DTRC LLC	Nevada
JR Resources (Canada) Services Corp.	British Columbia
Dakota Gold (Canada) Services Corp.	British Columbia
Dakota Gold Holdings LLC	South Dakota