Gold Mountain Mining Corp. — Management Reports 2022

Apr 30, 2022

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE COMPANY’S FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE YEAR ENDED JANUARY 31, 2022

GENERAL BUSINESS AND OVERVIEW

Gold Mountain Mining Corp., previously Freeform Capital Partners Inc. (hereinafter “GMTN” or the “Company”) was incorporated pursuant to the provisions of the Business Corporations Act of British Columbia on November 5, 2018. The Company’s common shares were listed on the TSX Venture Exchange (the “TSXV”) under the stock symbol (“FRM.P”) and commenced trading on June 19, 2020. On December 23, 2020, the Company changed its name to Gold Mountain Mining Corp. On December 31, 2020, the Company listed on the TSXV as a Tier 2 Mining Issuer and began trading on the TSXV under the stock symbol “GMTN.V”. Subsequently, on November 23, 2021, the Company’s common shares graduated to the main board of the Toronto Stock Exchange and continued to trade under the symbol “GMTN”. On January 22, 2021 the Company began trading on the Frankfurt Stock Exchange under the ticker “5XFA”. On April 15, 2021, the Company’s common shares also began trading on the OTCQB Venture Market under the stock symbol “GMTNF”.

It is fundamental for readers of this document to be aware that effective December 23, 2020, the Company underwent a reverse takeover transaction (“RTO”). The RTO resulted in numerous changes to the Company’s business, including changing its name from Freeform Capital Partners Inc. to Gold Mountain Mining Corp. and acquiring all the shares of Bayshore Minerals Incorporated (“Bayshore”), a private company holding a 100% interest in Elk Gold Mining Corp (“Elk Mining”), which is the owner of the Elk Gold Property in British Columbia, Canada and its subsidiary Gold Mountain Resources Corp. (“GMRC”). See “Reverse Takeover” section below.

GMTN is a gold production, development and exploration company currently focused on the exploration and development of the Elk Gold Property. The Company’s registered head office address is Suite 1000, 1285 West Pender Street, Vancouver, B.C. V6E 4B1.

All public filings for the Company can be found on the SEDAR website www.sedar.com.

DATE AND SUBJECT OF REPORT

The following is Management’s Discussion & Analysis (“MD&A”) of the Company’s financial condition and results of operations for the year ended January 31, 2022 and to the date of this MD&A. This MD&A should be read in conjunction with the audited consolidated financial statements for the years ended January 31, 2022 and January 31, 2021. This report is dated April 28, 2022.

The Company reports its financial results in Canadian dollars and all references to $ in this MD&A refer to the Canadian dollar. All financial information in this MD&A is derived from the Company’s consolidated financial statements for the years ended January 31, 2022 and January 31, 2021 prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”).

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FORWARD LOOKING STATEMENTS

The information set forth in this MD&A contains statements concerning future results, future performance, intentions, objectives, plans and expectations that are, or may be deemed to be, forward-looking statements. These statements concerning possible or assumed future results of operations of the Company are generally, but not always, preceded by, followed by or include the words ‘believes,’ ‘expects,’ ‘anticipates,’ ‘estimates,’ ‘intends,’ ‘plans,’ ‘forecasts,’ or similar expressions. Forward-looking statements are not a guarantee of future performance. These forward-looking statements are based on current expectations that involve numerous risks and uncertainties, including, but not limited to, those identified in the Risks and Uncertainties section in this MD&A and the Annual Information Form. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately. Although management believes such assumptions underlying the forward-looking statements to be reasonable, any of the assumptions could prove inaccurate. These factors should be considered carefully, and readers should not place undue reliance on forward-looking statements. The Company may not provide updates or revise any forward-looking statements, except those otherwise required under paragraph 5.8(2) of NI 51-102, whether written or oral that may be made by or on the Company's behalf.

BUSINESS DEVELOPMENT AND OVERALL PERFORMANCE

Strategic financings

On February 23, 2021, the Company closed its brokered private placement by issuing 10,310,000 units at a price of $0.97 per unit for gross proceeds of $10,000,700. Each unit consists of one common share of the Company and one-half of a share purchase warrant. Each full warrant is exercisable for one common share of the Company for a price of $1.25 for a period of three years following the closing of the private placement.

On June 24, 2021, the Company announced that it had completed a bought deal private placement (the “Offering”) led by Canaccord Genuity Corp, Eight Capital and Red Cloud Securities Inc. (collectively the “Underwriters”). The Company issued a total of 4,255,190 units (the “HD Units”) at a price of $2.10 per HD Unit and 1,326,450 flow-through units (the “FT Units”) at a price of $2.31 per FT Unit, for total gross proceeds of $11,999,999. Each FT Unit consists of one common share of the Company and one-half of one common share purchase warrant where each common share entitles the holder to a renunciation, for tax purposes, of qualifying expenditures incurred by the Company in respect of the Elk Gold Property. Each HD Unit consists of one common share of the Company and one-half of one common share purchase warrant. Each HD Unit and FT Unit warrant will entitle the holder thereof to purchase one common share of the Company at an exercise price of $3.15 for a period of two years following the closing date of the Offering.

In connection with the Offering, the Underwriters received an aggregate cash fee of $690,000 and 320,612 non-transferrable broker warrants. Each broker warrant entitles the holder thereof to purchase one common share at an exercise price of $2.10 for a period of two years from closing.

During the year ended January 31, 2021, the Company successfully raised aggregate gross proceeds of $5,796,376 through private placements by issuing a total of 9,703,379 common shares of the Company.

Mine Permit and development

In October 2021, the Company received its M-199 Mining Permit amendment which allows the Company to mine up to 70,000 tonnes of ore per year from the Elk Gold Project. Subsequently in November 2021, the Company mined its first mineralized material from the Elk Gold Project.

Mining

In February 2022, the Company delivered its first ore to New Gold’s New Afton Mine. Mined ore is being crushed, sampled, and assayed prior to being delivered to New Afton per the terms of the Ore Purchase Agreement. The Company began ore delivery in the month of February and is in the process of ramping up ore delivery.

Base Shelf Prospectus

On December 9, 2021, the Company filed and obtained a receipt for its final short form base shelf prospectus with securities regulatory authorities in each of the provinces (except Quebec) and territories of Canada (the “Base Shelf”). The Base Shelf allows the Company to qualify the distribution by way of prospectus in Canada of up to $50,000,000 of common shares, warrants, subscription receipts, units or debt securities or any combination thereof, during the 25-month period that the Base Shelf is effective. The specific terms of any offering under the base shelf prospectus will be established in a prospectus supplement, which will be filed with the applicable Canadian securities regulatory authorities in connection with any such offering.

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On April 21, 2022, the Company closed a bought deal public offering of 14,800,000 units for $1.25 per unit raising gross proceeds of $18,500,000. Each unit consisted of one common share and one-half share purchase warrant. The Company issued a total of 14,800,000 common shares, 7,400,000 warrants exercisable until April 21, 2024 for $1.75 and 660,000 underwriter warrants exercisable until October 21, 2023 for $1.25.

Reverse Takeover

On December 23, 2020, the Company completed the three-cornered amalgamation (Qualifying Transaction) between the Company, its wholly owned subsidiary, 1262975 B.C. Ltd. (“975 B.C.”), and Bayshore, under which 975 B.C. amalgamated with Bayshore and Bayshore became a wholly owned subsidiary of the Company. As a result of this acquisition, the shareholders of Bayshore obtained control of the Company through the acquisition of approximately 75.56% of the common shares of the combined entity and the transaction has been accounted for as a RTO.

Accordingly, for accounting purposes, Bayshore has been treated as the accounting parent company (legal subsidiary) and the Company has been treated as the accounting subsidiary (legal parent) in the consolidated financial statements. As Bayshore was deemed to be the acquirer for accounting purposes, its assets, liabilities and operations since incorporation are included in the consolidated financial statements at their historical carrying value. The Company’s results of operations have been included from December 23, 2020, the date of the RTO.

Concurrent with the RTO, the Company completed a subscription receipts financing (“Concurrent Financing”) of 5,185,433 units at a price of $0.90, raising gross proceeds of $4,666,890. Each unit consisted of one common share and one-half of a common share purchase warrant. Each full share purchase warrant is exercisable for one common share of the Company for a price of $1.20 for a period of three years following the closing of the Concurrent Financing. Further, brokers’ commission of $266,962 in cash and 296,624 warrants with a fair value of $96,714 were paid in relation to the Concurrent Financing. Each brokers’ warrant is exercisable for one common share of the Company for a price of $0.90 for a period of two years.

OUTLOOK

The Company intends to continue focusing on its Elk Gold Project located in British Columbia, Canada and further the work program set forth in the Elk Gold Technical Report, including exploration of multiple mineralized zones and continuing to ramp up production to an anticipated steady state of 19,000 ounces of gold per year.

Exploration

The Company plans on conducting the following exploration:

Drilling:

• Phase IV, approximately 10,000m will target the Siwash North and Gold Creek zones with a goal of converting inferred resources to the measured and indicated categories and potentially adding new ounces to the inferred category. The Company also anticipates continuing to drill the Elusive Zone to advance the Company’s understanding of the deposit.

• The Company anticipates beginning a 10,000m Phase V drill program in September 2022. The results of the Phase IV exploration program will dictate the focus of the Phase V drill program.

Geological mapping and prospecting:

• The Company will also conduct geological mapping, prospecting, soil geochemical surveys and ground magnetic surveys with a view to better define future drill targets around the property.

Updated Technical Report and Preliminary Economic Assessment

• The Company anticipates completing an updated resource estimate and preliminary economic assessment in the third quarter of 2022, which incorporates the results of the Phase III drill program. The Company may elect to conduct a pre-feasibility or feasibility study.

Mine Development and Expansion

Environmental Assessment: The Company anticipates applying to designate the Elk Gold Project as a reviewable project under the Environmental Assessment Act for expanding the production at the Elk Gold Project to 325,000 tonnes per year of ore which will require an Environmental Assessment. The Company anticipates allocating $1,500,000 to the Environmental Assessment process.

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Underground Decline Rehab and Development: A majority of the proposed expansion of the Elk Gold Project involves conducting underground mining. In order to do so, the Company must rehabilitate the historic underground decline that is currently flooded and was developed by previous owners and develop new underground infrastructure.

ELK GOLD PROJECT

Property Description and Location

On May 16, 2019, the Company acquired the Elk Gold Project in British Columbia, Canada from Equinox Gold Corp. (“Equinox”).

The Elk Gold Project is located in south central British Columbia, Canada, approximately 325km northeast of Vancouver and 55km west of Okanagan Lake, midway between the cities of Merritt and West Kelowna. The map below sets out the location of the Elk Gold Project.

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Land Tenure

The Company holds its interest in the Elk Gold Project through its wholly owned subsidiary, Elk Gold Mining Corp. The entire Elk Gold Project consists of 32 contiguous mineral claims covering 22,152 hectares and two mining leases covering 646 hectares. The 150-hectare mining lease expires on September 14, 2022 and the 496 hectare mining lease expires on November 17, 2051. All mineral claims were scheduled to expire on April 30, 2021 but due to COVID-19, expiry dates on claims were extended to December 31, 2022. The claims may be maintained beyond their current expiry date by continuing to conduct work on the property at the rate of $331,321 per year, or by cash payment in lieu at double that rate. The mining lease may be maintained by paying a yearly rental of $3,000 and providing an annual reclamation report that is acceptable to the Ministry of Energy, Mines and Petroleum Resources. Surface rights are currently held by the provincial government of British Columbia. The Company has met the annual spend requirements for 2022 for the mineral claims and intends to maintain the mining leases.

Permitting

The Company holds Mine Permit M-199 (“Mine Permit”), Effluent Discharge Permit #106262 (“Discharge Permit”) as well as Exploration Permit M-4-387 (“Exploration Permit”). In October 2021, the Company obtained an amendment to the Mine Permit to allow for production of up to 70,000 tonnes per year, which is valid for the life of mine (currently contemplated for 11 years). The Company received its amendment to the Discharge Permit on February 23, 2022, which allows for construction of a new waste rock storage facility.

Exploration on the Elk Gold Project is regulated via two permits: the Mine Permit for work in the mining permit area and the Exploration Permit for exploration on the surrounding claims.

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Reclamation Commitments

The Mine Permit provides for posting a total of $15,866,700 in reclamation security in installments, as shown on the table below:

below:
Date	Installments($)	Cumulative($)
Within 60 days of the issuance of the M-199 Permit(December 20,2021)	4,592,500	4,742,500
October 1,2022	2,703,400	7,455,900
October 1,2023	2,040,800	9,486,700
October 1,2024	1,380,000	10,866,700
October 30,2024*	5,000,000	15,866,700

*If the construction and commissioning of the active water treatment plant is completed to the satisfaction of the Chief Permitting Officer by October 30, 2024, Gold Mountain is not required to post the additional security in the amount of Five Million ($5,000,000) dollars that would otherwise be due on that date.

On December 20, 2021, the Company as principal and Intact Insurance Company as surety posted a reclamation security bond of $715,893 in favor of the Province of British Columbia for $4,742,500 with a term of one year. The Company provided cash collateral of $715,893. The Company anticipates posting similar reclamation security bonds each time a reclamation security installment becomes due.

Royalties and Encumbrances

Equinox Share Pledge Agreement

On May 16, 2019 Bayshore entered into a share pledge agreement with Equinox whereby Bayshore pledged the Elk Mining shares to Equinox as security for amounts owing under the Equinox promissory note, which was issued in connection with Bayshore’s purchase of the Elk Gold Project. If the Company defaults on the payment of the Equinox promissory note, then Equinox may take possession of the Elk Mining shares. The Equinox promissory note is repayable in three annual instalments of $3,000,000 with the first payment having been made on May 17, 2021. The remaining payments are due as follows: $3,000,000 on May 16, 2022 and $3,000,000 on May 16, 2023. The total remaining amount due under the Equinox promissory note may be adjusted such that if the Company pays $5,500,000 prior to May 16, 2022, that will represent full and final payment.

Net Smelter Return (“NSR”) Royalties

Production from the Elk Gold Project is subject to a 2% NSR royalty held by Star Royalties Ltd., who purchased the 2% NSR royalty from Almadex Minerals Limited on September 28, 2021 for total consideration of US$10,630,000. A further 1% NSR royalty is payable to Don Agur on production from the Agur Option block which is outside of any of the identified mineralized zones.

Location of Mineralized Zones

The Elk Project is host to eight known mineralized zones. Following the conclusion and findings of the Phase 2 drill program the Siwash North Zone was expanded and connected to the historically viewed satellite Gold Creek Zone, which enabled the Company to merge the geological models and consolidate the deposits. The map below sets out the names and location of those zones within the Elk Gold Project.

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Resource Estimation

Following the results of the Phase 2 drill program the Company disclosed an updated resource estimate in a press release dated December 7, 2021. In January 2022, the Company filed an updated NI 43-101 compliant independent Technical Report for the Elk Gold Project titled “National Instrument 43-101 Technical Report and Resource Update on the Elk Gold Project, Merritt, British Columbia, Canada” prepared by L. John Peters, P.Geo, Gregory Z. Mosher, P.Geo, and Marinus Andre De Ruijter, P. Eng, each an independent "Qualified Person" as defined in NI 43-101, with an effective date of December 7, 2021, and a report date of January 21, 2022.

The table below summarizes the updated resource estimate at the Elk Gold Project:

Combined	Elk Gold Property	Mineral Resource	(Pit-Constrained and	Underground) Dec 2021
Classification	Tonnes	AuEq (g/t)	**Au Cappedg/t **	**Ag Cappedg/t **	AuEq (Oz)
Measured	169,000	10.4	10.3	10.9	56,000
Indicated	4,190,000	5.6	5.4	11.0	750,000
Measured +	4,359,000	5.8	5.6	11.0	806,000
Indicated
Inferred	1,497,000	5.4	5.3	14.4	262,000

CIM definitions were followed for classification of Mineral Resources.

Mineral Resources are not Mineral Reserves and have not demonstrated economic viability. Results are presented in-situ and undiluted.

Mineral resources are reported at a cut-off grade of 0.3 g/t AuEq for pit-constrained resources and 3.0 g/t AuEq for underground resources.

The number of tonnes and metal ounces are rounded to the nearest thousand.

The Resource Estimate includes both gold and silver assays. The formula used to combine the metals is: AuEq = ((Au_Cap53.200.96) + (Ag_Cap0.670.86))/(53.20*0.96) The Resource Estimate is effective as of October 21, 2021.

The resource estimate includes resources in three separate zones on the Elk Gold Project: i) the Siwash North, which comprises the majority of the estimate, ii) the Lake Zone and iii) the South Zone.

Mineral Resource Estimate Assumptions

a. Data Verification

The data that forms the basis for the Resource Estimate was verified by the Qualified Person using industry standard methods. Drill hole collar locations were confirmed with independent surveyors’ using high precision GPS equipment. Analytical accuracy and precision are monitored using commercial standards, blanks, re-analysis of both coarse rejects and pulps. A review of all data inputs to the drilling database, both historical and recent, has allowed a sufficient level of confidence to include the drill database in the Resource Estimate

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b. Key Assumptions and Parameters and Methods Used to Estimate Resources

• i) Exploration Information

The data from the 47 Phase 2 drill holes were added to the 2021 drill data for an aggregate total of 1,125 holes that intersected the 46 modelled mineralized zones. The assay file contained 23,093 gold and silver assays of which 6,406 were contained within the modelled zones.

ii) Grade Capping - Siwash North

A cumulative frequency curve was generated for both gold and silver assay values to determine whether capping of assay values was appropriate. There is a distinct break in the gold assay cumulative frequency curve at 400 g/t and that value was taken as the capping value. There were 10 gold assay values over 400 g/t. The silver cumulative frequency curve has a break at 450 g/t and that value was taken as the capping value. There are 11 samples in the population which were greater than 450 g/t silver.

iii) Grade Capping - Lake Zone

No grade capping was applied in the Lake Zone for this resource estimate.

iv) Grade Capping - South Zone In the South Zone, gold grades were capped at 60g/t Au and there is 1 gold assay value over 60 g/t. The silver grades were capped at 160g/t Ag and there are 2 samples in the population which were greater than 160 g/t silver.

• v) Vein Modelling

• The Resource Estimate is constrained to a vein wireframe model which was developed using LeapfrogTM software by clipping the wireframes to a combination of drill hole composites and lithological units.

• vi) Metal Equivalency

The Resource Estimate includes both gold and silver assay values and the combined value is expressed as a gold equivalency. The formula by which the two metals are combined is:

AuEq = ((Au_Cap53.200.96) + (Ag_Cap0.670.86))/(53.20*0.96)

For information on the data verification and key assumptions and parameters used to estimate the mineral resources, please see the NI 43-101 compliant independent Technical Report, a copy of which is available at www.sedar.com.

Summary of Preliminary Economic Assessment

In November 2021, the Company filed an amended NI 43-101 compliant independent Technical Report and Preliminary Economic Assessment (“PEA”) for the Elk Gold Project titled “National Instrument 43-101 Technical Report Updated Preliminary Assessment on the Elk Gold Project, Merritt, British Columbia, Canada” prepared by Robert G. Wilson, P.Geo, Greg Z. Mosher, P.Geo, Antonio Loschiavo, P.Eng., and Andre De Ruijter, P. Eng, each an independent "Qualified Person" as defined in NI 43-101, with an effective date of May 14, 2021, a report date of August 26, 2021 and an amended date of November 4, 2021.

The PEA uses the following resource estimate and does not incorporate the updated resource estimate set out above.

The table below summarizes the current resource estimate at the Elk Gold Project used in the PEA:

Classification	Tonnes	AuEq (g/t)	**Au Cappedg/t **	**Ag Cappedg/t **	AuEq (Oz)
Measured	196,000	9.9	9.8	9.9	63,000
Indicated	3,148,000	5.8	5.7	11.2	589,000
Measured +	3,344,000	6.1	5.9	11.1	651,000
Indicated
Inferred	1,029,000	4.8	4.7	10.9	159,000

CIM definitions were followed for classification of Mineral Resources. Mineral Resources are not Mineral Reserves and have not demonstrated economic viability. Results are presented in-situ and undiluted.

Mineral resources are reported at a cut-off grade of 0.3 g/t Au for pit-constrained resources and 3.0 g/t for underground resources.

The number of tonnes and metal ounces are rounded to the nearest thousand. The Resource Estimate includes both gold and silver assays. The formula used to combine the metals is: AuEq = ((Au_Cap55.810.96) + (Ag_Cap0.760.86))/(55.81*0.96) The Resource Estimate is effective as of May 1, 2021.

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The PEA contemplates an initial 19,000 ounce per year mine that ramps up to 65,000 ounces of annual production by Year 4. The pre and post tax net present value (“NPV”) (5% discount) are $395M and $231M, respectively. The PEA contemplates that for the life of mine, the mineralized material from the Elk Gold Project will be mined by the Company’s contract mining partner, Nwhelmen-Lake LP (“Nwhelmen-Lake”) and then delivered to New Gold’s New Afton Mine located approximately 130km from the Elk Gold Project (the “New Afton Mine”).

The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

The mine is scheduled to release 70,000 tonnes per year of plant feed for Years 1 to 3. In Year 4, the mine is planned to expand to 324,000 tonnes per year.

The tables below further summarize the basis for the PEA and the assumptions and parameters used:

Base Case: US$1,600/oz long-term gold price and an exchange rate of 1.25 (US$/CAD$)
Gold Price	Long-term US$1,600
Exchange Rate	1.25
NPV @ 5% Pre-tax	$395 million
NPV @ 5% After-tax	$231 million
Year 1 owner’s costs	$3.9 million
Year 1 capital costs	$9.0 million
Sustaining owner’s costs	$12.8 million
Sustaining capital costs	$54.5 million
After tax payback period	1 Year
All in sustaining costs (AISC) per ounce gold	US$554 / troy ounce
PEA life of mine (LOM)	11 years
LOM metal production gold equivalent ounces	582,080 oz
LOM metal recovered gold equivalent ounces	532,942 oz
LOM average gold head grade	6.98 g/t
LOM average silver head grade	11.73 g/t
LOM strip ratio (waste:ore)	20.2:1

Internal rate of return (“IRR”) note: there are relatively insignificant pre-production costs prior to commencement of commercial production on the Elk Gold Project. Initial capital costs of approximately $9.0M are captured in year 1 of operations, which results in a positive year 1 cashflow of $27.2M. Since there is no negative cashflow that precedes the positive cashflow, IRR is not calculable.

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Additional PEA Assumptions and Parameters:
Gold Recovery	92%
Silver Recovery	70%
Gold Payable	96%
Silver Payable	90%
Gold TC/RC	$6.00/oz
Silver TC/RC	$0.50/oz
NSR Royalty	2%

PEA Sensitivities

The table below sets out a sensitivity analysis showing the effect the price of gold has on the Elk Gold Project’s NPV. The bold line shows the PEA’s base case.

Gold Price (US$)	Pre-tax NPV (5%) ($M)	Post-tax NPV (5%) ($M)
2200	644.6	379.3
2000	561.5	329.9
1800	478.2	280.3
1600	395.4	231.0
1400	311.9	181.3
		131.2
1200	228.7

For information on the data verification and key assumptions and parameters used to estimate the mineral resources and the PEA, please see the PEA a copy of which is available at www.sedar.com.

Phase 2 Exploration

In November 2021, the Company completed its Phase 2 exploration program. Phase 2 drilling targeted extensions of the highgrade mineralization the Company consistently encountered during Phase 1 in the Siwash North Zone. The Company also successfully drilled certain satellite zones, including the South Zone, Lake Zone, Gold Creek Zone and the Elusive Zone, which is located approximately 10km from the Siwash North Zone where historic high-grade soil geochemical samples indicate promising new potential at the Elk Gold Project. Based on the results of the Phase 2 exploration program, the Company updated its resource model which incorporated maiden resources across new zones on the property and released a new Technical Report. Drill results from the Elusive Zone resulted in the discovery of a new high-grade gold system.

Phase 3 Exploration

With the conclusion of Phase 2 drilling, the Company and HEG Exploration Services Inc. immediately transitioned into the Elk Gold Project’s Phase 3 exploration program (“Phase 3”), with the first holes of the campaign already being completed in the Siwash North Zone followed by drilling in the Gold Creek Zone. Currently, the program is nearing completion and has drilled approximately 11,000 total meters as of mid-April.

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Phase 4 Exploration

Exploration activities at the Elk Gold Project will pause during spring breakup at the project site and will recommence with the Phase 4 exploration program in approximately mid-May. The Phase 4 exploration program is planned to include numerous activities including geological mapping and prospecting, soil geochemical surveys, ground magnetic surveys and diamond drilling. Phase 4 is planned to include a total of 10,000m of drilling in the Siwash North, Gold Creek and Elusive Zones. Geological mapping, soil geochemistry and ground magnetic surveys will be used in the Siwash North and the satellite zones to better define drill targets identified in 2021.

Mining

Development and construction activities commenced at the Elk Gold Project in July 2021 and in February 2022, the Company delivered its first ore to New Gold’s New Afton Mine. Mined ore is being crushed, sampled, and assayed prior to being delivered to the New Afton mine in accordance with the terms of the Ore Purchase Agreement, which specifies the sale will be recognized upon delivery of ore. The Company is in the process of ramping up production to a steady state with the goal of reaching 19,000 oz/Au of annual production.

The Company based its production decision at the Elk Gold Project on a preliminary economic assessment and not on a feasibility study or pre-feasibility study of mineral reserves demonstrating economic and technical viability. The Company did not complete a feasibility study or pre-feasibility study in connection with its production decision due to, among other factors, the ability to move ahead to development and production based on comparatively low initial capital costs by foregoing the need to construct a processing facility and the Company's knowledge of the resource base. As a result, there is increased uncertainty and there are multiple technical and economic risks of failure which are associated with this production decision. These risks, among others, include the inclusion of inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves.

Furthermore, there are risks associated with areas that are analyzed in more detail in a pre-feasibility and feasibility study, such as applying economic analysis to resources and reserves, more detailed metallurgy and a number of specialized studies in areas such as mining and recovery methods, market analysis, and environmental and community impacts. There is no assurance given all of the known and potentially unknown risks associated with the Elk Gold Project that the Company will be able to profitably carry on mining operations. In addition, there is no assurance that production will continue to be profitable or that continued exploration of the Elk Gold Project will demonstrate adequate additional mineralization which can be mined economically, such that mining operations on the Elk Gold Project may not be sustainable beyond currently estimated resources or in the medium to long term.

Indigenous Community Engagement

On June 3, 2021, the Company announced that it successfully executed three memorandums of understanding with surrounding Indigenous communities, establishing a process for ongoing engagement towards social and economic collaboration.

While the Provincial Review and the corresponding Mine Review Committee process have come to a close following the issuance of the amended Mine Permit, the Company is aware and acknowledges each respective Indigenous Nation’s decision-making process will continue independently from the Province of British Columbia.

Over the past 18 months, the Company has made a concerted effort to build strong relationships with communities that are affected by the development of the Elk Gold Project. The Company looks forward to continued collaboration with all Indigenous Nations that have interests in the Elk Gold Project. The Company also wishes to communicate that there is no time limit on direct engagement and consultation between the Company and each respective Indigenous Nation.

One of the conditions in the Company’s Mine Permit is the establishment of the Elk Gold Life of Mine Committee made up of representatives of Indigenous communities around the Elk Gold Project and certain Provincial Agencies. The Company held its first Life of Mine Committee meeting on February 18, 2022, which was attended by First Nation representatives and Provincial agencies.

Contract Summaries

Ore Purchase Agreement

On January 26, 2021, the Company entered into the Ore Purchase Agreement with New Gold to purchase ore from the Elk Gold Project. Under the agreement, the Company is delivering ore to New Gold’s New Afton Mine located 130km from the Elk Gold Project near Kamloops, British Columbia. Gold Mountain will deliver up to 70,000 tonnes of ore per annum or approximately 200 tonnes per day. The Ore Purchase Agreement has a term of three years from the effective date (February 2022). In May 2021, the Company and New Gold signed a non-binding letter of intent contemplating the increase in tonnage to be delivered

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to the New Afton mine for up to 350,000 tonnes per annum, which is expected to begin in year four of production, subject to entering into a definitive agreement with New Gold.

The ore will be sampled and weighed at the Elk Gold Project site to determine the contained ounces of gold and silver being delivered to the New Afton Mine. Following delivery of the ore, New Gold will pay the Company on the 17th of each calendar month following the month of delivery based on the value of the gold and silver in the ore, net of the agreed metallurgical recovery and concentrate selling costs.

Mining Contract

On January 19, 2021, the Company entered into a mining contract (“Mining Contract”) with Nhwelmen-Lake for contract mining services at the Elk Gold Project. Nhwelmen-Lake is a majority owned, First Nations mining contractor.

Pursuant to the terms of the Mining Contract, Nhwelmen-Lake will be paid a fixed price per tonne mined over the first three years which is determined based on the planned production rate, mined volumes, haulage distances and equipment productivity. The scope of the Mining Contract includes mining of ore at a rate of 70,000 tonnes per annum (200 tonnes per day), waste mining, drilling, blasting, hauling, site supervision, supply of operating personnel, road maintenance, dust suppression as well as all the site preparation activities required prior to commencing mine operations, including topsoil stockpiling, and preparing surface water management structures. Nhwelmen-Lake will also haul the plant feed material from the Elk Gold Project to the toll milling location (New Afton mine).

The Mining Contract is for the life of mine while the price schedule carries a three-year term. The obligations of the Company under the Mining Contract began in May 2021.

ELK NORTH CLAIMS

On October 7, 2020, the Company staked the following claims located next to the Elk Gold Project as set out in the table below:

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The Company is currently evaluating the best strategy to explore and develop these separate claims.

ELKHOLE CLAIM

On January 28, 2022, the Company staked an additional claim that covers an area of 2,038 hectares located adjacent to the northern portion of the Elk Gold Project claims as set out in the table below:

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The Company is currently evaluating the best strategy to explore and develop these separate claims.

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PROPERTY AND EQUIPMENT

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Effective June 1, 2021, the Company commenced capitalization of all direct costs related to the development of the Elk Gold Project, as management determined that the technical feasibility and commercial viability of the project had been established. Accordingly, the Company reclassified capitalized costs associated with the Elk Gold Project from exploration and evaluation assets to mineral property within property and equipment. Capitalized mineral property costs will be carried at cost until the Elk Gold Project is placed in commercial production, sold, abandoned, or determined by management to be impaired in value. Costs related to development work are capitalized in property and equipment as mineral property.

During the year ended January 31, 2022, the Company recorded $591,477 in BC Mineral Exploration Tax Credits (“BCMETC”) as a reduction to the mineral property, bringing the total BCMETC receivable to $650,328.

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EXPLORATION AND EVALUATION ASSETS

The following is a description of the Company’s exploration and evaluation assets and related expenditures incurred in the years ended January 31, 2022 and 2021 by their nature:

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The remaining exploration and evaluation assets balance as at January 31, 2022 relates to ongoing exploration programs outside of the mine development zone.

FINANCIAL PERFORMANCE

Selected Annual Information

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On December 23, 2020, the Company completed the RTO.

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Summary of Quarterly Results

The following table summarizes the financial results of operations for the eight most recent fiscal quarters:

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On December 23, 2020, the Company completed the RTO.

The Company was in an active exploration and development phase during the year ended January 31, 2022 and the Company’s accounting policy is to capitalize exploration costs.

RESULTS OF OPERATIONS

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On December 23, 2020, the Company completed the RTO.

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Year ended January 31, 2022

For the year ended January 31, 2022, the net loss was $12,415,293 compared to $7,697,430 for the year ended January 31, 2021. On December 23, 2020, the Company completed the RTO.

Major variances are as follows:

• i) An increase in share-based payments of $4,507,068 for the year ended January 31, 2022 primarily related to the vesting of restricted share units, performance share units and stock options as a result of increased activity in the Company.

• ii) An increase in management, director and consulting fees of $1,573,773 mainly due to increased management fees for services provided by the officers and higher consulting fees for corporate advisory services post-closing of the RTO transaction as well as increased activity in the Company.

• iii) An increase in marketing expenses of $2,897,039 for year ended January 31, 2022 primarily related to various digital marketing and advertising campaigns to provide public awareness of the Company and attract new investors.

• iv) An increase in regulatory and transfer agent fees of $327,798 primarily related to the initial listing fee on the Toronto Stocks Exchange and various share issuances during the year ended January 31, 2022.

• v) An increase in investor relations of $214,029 for the year ended January 31, 2022 primarily related to new contracts entered into by the Company for investor relation communications.

• vi) An increase in professional fees of $196,126 for the year ended January 31, 2022 mainly due to higher audit fees for quarterly review of interim financial statements, tax related services and higher accrual of audit fee. The increase in professional fees is also due to higher legal fees for services related to the base shelf prospectus offering.

• vii) A $100,889 recovery of flow-through share premium for the Company’s exploration activities during the year ended January 31, 2022.

• viii) A decrease in interest expense and finance costs of $172,481 primarily related to reduced accretion on the promissory note dated May 16, 2019 with Equinox due to a reduction of the loan principal from the first installment being paid on May 17, 2021.

Three-month period ended January 31, 2022

For the three-month period ended January 31, 2022, the net loss was $2,073,803 compared to $5,847,979 for the three-month period ended January 31, 2021. On December 23, 2020, the Company completed the RTO.

Major variances are as follows:

• i) An increase in share-based payments of $293,083 for the quarter ended January 31, 2022 primarily related to the vesting of restricted share units, performance share units and stock options as a result of increased activity in the Company.

• ii) An increase in management, director and consulting fees of $190,364 for the quarter ended January 31, 2022 mainly due to increased management fees for services provided by the officers of the Company and higher consulting fees for corporate advisory services post-closing of the RTO transaction as well as increased activity in the Company.

• iii) An increase in marketing expenses of $108,377 for the quarter ended January 31, 2022 primarily related to various digital marketing and advertising campaigns to provide public awareness of the Company and attract new investors.

• iv) An increase in regulatory and transfer agent fees of $253,980 primarily related to the initial listing fee on the Toronto Stocks Exchange.

• v) An increase in investor relations of $87,945 for the quarter ended January 31, 2022 primarily related to new contracts entered into by the Company for investor relation communications.

• ix) An increase in professional fees of $193,373 for the quarter ended January 31, 2022 mainly due to higher audit accruals for the annual financial statements and, tax related services. The increase in professional fees is also due to higher legal fees for services related to the base shelf prospectus offering.

• vi) A decrease in interest expense and finance costs of $81,021 for the quarter ended January 31, 2022 primarily related to reduced accretion on the promissory note dated May 16, 2019 with Equinox due to a reduction of the loan principal from the first installment being paid on May 17, 2021.

• vii) A decrease in listing expense of $4,798,548 for the quarter ended January 31, 2022 as the RTO transaction was completed during the quarter ended January 31, 2021. The listing expense reflects the difference between the estimated fair value of the purchase price and the net assets of the company acquired plus other legal and professional fees in connection with the RTO transaction.

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LIQUIDITY AND CAPITAL RESOURCES

As at January 31, 2022, the Company had a cash balance of $2,557,764 (January 31, 2021 – $2,691,382) and a working capital deficit of $1,191,637 (January 31, 2021 – deficit of $1,088,426).

During the year ended January 31, 2022, the Company incurred a net loss of $12,415,293 and as at January 31, 2022 had an accumulated deficit of $21,563,235.

Year ended January 31, 2022

On February 23, 2021, the Company closed its brokered private placement of units by issuing 10,310,000 units consisting of one common share and one-half of a share purchase warrant for gross proceeds of $10,000,700.

On May 17, 2021, the Company paid the first installment payment of $3,000,000 due to Equinox.

On June 24, 2021, the Company closed a bought deal private placement by issuing 4,255,190 HD Units at a price of $2.10 and 1,326,450 FT Units at a price of $2.31 for gross proceeds of $11,999,999.

During the year ended January 31, 2022, 2,695,894 warrants were exercised for gross proceeds of $3,033,297 and 1,209,258 stock options were exercised for gross proceeds of $510,133.

Subsequent to January 31, 2022, the Company issued 651,926 common shares from warrant exercises for gross proceeds of $783,558 and issued 196,000 common shares from stock option exercises for gross proceeds of $149,000.

Year ended January 31, 2021

On June 9, 2020, the Company closed the first tranche of a non-brokered private placement for gross and net proceeds of $125,000 and issued 500,000 common shares.

On June 25, 2020, the Company closed the second tranche of a non-brokered private placement for gross and net proceeds of $35,000 and issued 140,000 common shares.

On July 29, 2020, the Company closed the third tranche of a non-brokered private placement for gross and net proceeds of $969,486 and issued 3,877,946 common shares.

On December 23, 2020, concurrent with the RTO, the Company completed a subscription receipts financing of 5,185,433 units at a price of $0.90, raising gross proceeds of $4,666,890.

The following table summarizes cash inflows and outflows for the periods shown:

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Cash flows used in operating activities can vary significantly from period to period as a result of the Company’s working capital requirements, which are dependent on the level of operations and increased spending typically results during periods of expansion. The Company commenced ore delivery to the New Afton mine subsequent to January 31, 2022.

Cash flows used in investing activities can vary depending on the nature of the transactions occurring during the year. During the year ended January 31, 2022, most investing activities related to exploration and evaluation expenditures, mineral property expenditures.

Cash flows provided by financing activities for the year ended January 31, 2022 resulted from the issuance of shares from private placements and exercises of warrants and options partially offset by the partial repayment of Equinox promissory note.

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RELATED PARTY TRANSACTIONS

Transactions

The Company has identified the CEO (Mr. Kevin Smith), President (Mr. Ronald Woo), CFO (Mr. Braydon Hobbs), COO (Mr. Grant Carlson) and General Counsel and Corporate Secretary (Mr. Alex Bayer) and the Company’s directors as its key management personnel. During the year ended January 31, 2022 and 2021, the following amounts were incurred for key management personnel of the Company:

	January 31, 2022	January 31, 2021
Management, director and consulting fees	$ 1,016,519	$ 64,967
Share-based payments	2,589,310	333,814
Total compensation	$ 3,605,829	$ 398,781

Included in the management, director and consulting fees for the year ended January 31, 2022 was 230,000 bonus shares issued to officers of the Company with a fair value of $289,800.

During the year ended January 31, 2022, the Company converted 170,000 of vested RSUs and 1,070,000 of vested PSUs into common shares and issued them to the directors and officers of the Company.

During the year ended January 31, 2022 and 2021, included in management, director and consulting fees disclosed above are fees capitalized to the following:

	January 31, 2022	January 31, 2021
Exploration and evaluation asset	$ 15,000	$ -
Mineral property	207,673	-
	$ 222,673	$-

During the year ended January 31, 2022 and 2021, included in share-based payments disclosed above are fees capitalized to the following:

	January 31, 2022	January 31, 2021
Exploration and evaluation asset	$ 22,232	$ -
Mineral property	640,935	-
	$ 663,167	$-

Balances

The following amounts due to related parties are unpaid director and management fees and expense reimbursements included in trade payables and accrued liabilities. These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.

Related party liabilities:	January 31, 2022	January 31, 2022	January 31, 2021	January 31, 2021
CEO(1)	$	156,570	$	21,364
President(2)		67,333		17,333
COO(3)		76,570		36,275
CFO(2)		44,000		14,000
General Counsel and Corporate Secretary(5)		157,725		70,591
Director(4)		9,000		9,000
Former director of subsidiary(4)		6,217		6,217
	$	517,415	$	174,780

(1) Related party liabilities include management fees and expense reimbursements.

(2) Related party liabilities include management and director fees.

(3) Related party liabilities include management and director fees and expense reimbursements.

(4) Related party liabilities for director fees.

(5) Related party liabilities for management fees.

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COMMITMENTS

On January 26, 2021, the Company entered into an OPA with New Gold for a three-year term. Under the terms of the OPA, GMTN will deliver up to 70,000 tonnes of ore per annum, approximately 200 tonnes per day, to the mill located at New Gold’s New Afton Mine situated 130km from the Elk Gold Project, in Kamloops British Columbia.

The OPA is effective upon the first delivery of ore to the New Afton Mine, which occurred in February 2022.

FINANCIAL INSTRUMENT RISK

The following table summarizes the classifications of the Company’s financial instruments under IFRS 9:

Financial Asset/Liability	IFRS 9 Classification
Cash	Amortized cost
Receivables excluding GST receivables	Amortized cost
Reclamation deposits	Amortized cost
Accounts payable and accrued liabilities	Amortized cost
Short-term loans	Amortized cost
Promissory note	Amortized cost

The carrying values of receivables, excluding GST receivables, accounts payable and accrued liabilities and short-term loans approximate their fair value because of the relatively short-term nature of the instruments and are measured and reported at amortized cost. The promissory note and reclamation deposits are measured and reported at amortized cost using the effective interest rate method. These estimates are subjective and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumption could significantly affect the estimates.

There are three levels of the fair value hierarchy as follows:

• Level 1: Values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

• Level 2: Values based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability.

• Level 3: Values based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk management processes, inclusive of documented investment policies, counterparty limits, and controlling and reporting structures. The type of risk exposure and the way in which such exposure is managed is summarized as follows:

Credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company’s primary exposure to credit risk is on its cash held in bank accounts. The majority of cash is deposited in bank accounts at a major bank in Canada. As most of the Company’s cash is held by one bank there is a concentration of credit risk. This risk is managed by using the major bank that is a high credit quality financial institution as determined by rating agencies.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis. The Company aims to have sufficient funds to meet its short-term business requirements, taking into account its anticipated cash flows from future operations and its ability to raise equity capital or borrowing sufficient funds and its holdings of cash.

Historically, the Company’s principal source of funding has been the issuance of equity securities for cash, primarily through private placements. The Company’s access to financing is always uncertain. There can be no assurance of continued access to necessary levels of equity funding.

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The following sets forth details of the payment profile of financial liabilities based on their undiscounted cash flows:

	Total carrying	Contractual	Less than 1	1 to 5	More than 5
	amount	cash flows	year	years	years
	$	$	$	$	$
Accounts payable and accrued liabilities	2,236,473	2,236,473	2,236,473	-	-
Short-term loans	80,223	84,440	84,440	-	-
Promissory note	5,270,546	6,000,000	3,000,000	3,000,000	-
Total	7,587,242	8,320,913	5,320,913	3,000,000	-

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risks.

Foreign exchange risk

The Company and its subsidiaries’ functional and reporting currency is the Canadian dollar and major purchases are transacted in Canadian dollars. As a result, the Company’s exposure to foreign currency risk is minimal.

RISK AND UNCERTAINTIES

Natural resources exploration, development and operation involves a number of risks and uncertainties, many of which are beyond the Company’s control. These risks and uncertainties include without limitation, the risks discussed elsewhere in this MD&A, those identified in the Company’s Annual Information Form for the year ended January 31, 2022 and the Company’s disclosure documents as filed in Canada on SEDAR at www.sedar.com. Reader's should carefully consider such risks and uncertainties prior to deciding to invest in the securities of GMTN.

MANAGEMENT’S RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENTS

The information provided in this MD&A as referenced from the Company’s consolidated financial statements for the referenced reporting period is the sole responsibility of management. In the preparation of the information along with related and accompanying statements and estimates contained herein, management uses careful judgement in assessing the values (or future values) of certain assets or liabilities. It is the opinion of management that such estimates are fair and accurate as presented.

USE OF ACCOUNTING ESTIMATES, JUDGMENTS AND ASSUMPTIONS

Information about judgments and estimates in applying accounting policies that have the most significant effect on the amounts recognized in the Company’s consolidated financial statements are included in Note 3 to the Company’s January 31, 2022 consolidated annual financial statements.

RECENT ACCOUNTING PRONOUNCEMENTS

IFRS accounting pronouncements with respect to new standards, interpretations and amendments that are not yet effective as at January 31, 2022, which have not been applied in preparing the Company’s consolidated annual financial statements, are not expected to materially impact the Company’s financial position or results of operations (see accounting pronouncements described under Note 2 in the Company’s annual audited consolidated financial statements for the year ended January 31, 2022).

OTHER INFORMATION

Additional information on the Company is available on SEDAR at www.sedar.com.

QUALIFIED PERSON AND INFORMATION CONCERNING ESTIMATES OF MINERAL PROJECTS

All of the scientific and technical information contained in this news release has been reviewed and/or approved by Mr. Grant Carlson, P. Eng., a "Qualified Person" within the meaning of National Instrument 43-101 - Standards of Disclosure for Minerals Projects and the Chief Operating Officer of the Company.

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USE OF PROCEEDS TABLE

The table below sets out the disclosure the Company has previously made about use of proceeds (other than working capital) from previous financings and any variations:

Financing	Disclosed Use	Actual Use	Variation
June 2020 - $200,000 IPO financing	Identification and evaluation of a qualified transaction	Same as disclosed use	No variation
July 2020 - $520,000 private placement	Identification and evaluation of a qualified transaction	Same as disclosed use	No variation
December 2020 - $4,666,890 financing concurrent with Qualified Transaction	Exploration at the Siwash North Zone and Lake Zone of the Elk Gold Project and general workingcapital.	Exploration at the Siwash North Zone and general working capital	The Company elected to focus all exploration on the Siwash North Zone in order to expand the resource.
February 2021 - $10,000,700 private placement	Advancement of the Elk Gold Project	Same as disclosed use	No variation
June 2021 - $11,999,999 bought deal private placement	Advancement of the Elk Gold Project (for funds from flow through portion, Canadian Exploration Expenses).	Same as disclosed use	No variation
April 2022 - $18,500,000 bought deal public offering	Development of Elk Gold Project, repayment of obligations under Equinox Promissory Note, business development, general and administrative expenses, general workingcapital.	Anticipated to be the same as disclosed use	No variation to date

SHARE CAPITAL AND OUTSTANDING SHARE DATA

Common shares, stock options, restricted share units, performance share units and share purchase warrants issued and outstanding as at the year-end are described in detail in Note 14 of the consolidated financial statements for the year ended January 31, 2022, which as of April 28, 2022 are as follows:

	Number of shares
Issued and outstanding	87,534,820

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