Trigon Metals Inc. — Audit Report / Information 2021

Jul 30, 2021

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Trigon Metals Inc.

Consolidated Financial Statements

For the years ended March 31, 2021 and 2020

(Expressed in Canadian Dollars)

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Independent Auditor’s Report

To the Shareholders of Trigon Metals Inc.

Opinion

We have audited the consolidated financial statements of Trigon Metals Inc. and its subsidiaries (the “Company”), which comprise the consolidated statements of financial position as at March 31, 2021 and 2020, and the consolidated statements of loss and comprehensive loss, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at March 31, 2021 and 2020 and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards (“IFRS”).

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material uncertainty related to going concern

We draw attention to Note 1 in the consolidated financial statements, which indicates that the Company incurred a net loss during the year ended March 31, 2021. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that material uncertainties exist that cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Other information

Management is responsible for the other information. The other information comprises Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

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We obtained Management’s Discussion and Analysis prior to the date of this auditor’s report. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risks of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

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• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

The engagement partner of the audit resulting in this independent auditor’s report is Chris Milios.

McGovern Hurley LLP

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Chartered Professional Accountants Licensed Public Accountants

Toronto, Ontario July 28, 2021

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Trigon Metals Inc. Consolidated Statements of Financial Position

(Expressed in Canadian dollars)

As at	Notes	March 31, 2021	March 31,2020
ASSETS
Current assets
Cash		$ 3,332,334	$ 2,051,421
Amounts receivable	4	56,557	33,953
Prepaid expenses	5	26,044	20,757
Total current assets		3,414,935	2,106,131
Non-current assets
Property and equipment	6	388,372	324,741
Total Assets		$ 3,803,307	$ 2,430,872
LIABILITIES
Current
Accounts payable and accrued liabilities	8,14,15	$ 437,457	$ 368,322
Bridge financing	9	-	418,222
Acquisition fees payable	14	837,776	-
Total current liabilities		1,275,233	786,544
Non-current liabilities
Acquisition fees payable	14	1,015,729	-
Total Liabilities		2,290,962	786,544
EQUITY
Equity attributable to shareholders of Trigon Metals Inc.:
Share capital	12	45,636,145	40,239,927
Warrants	13	2,490,361	1,831,520
Contributed surplus	13	745,037	834,647
Deficit		(46,741,166)	(40,773,424)
Total equity attributable to shareholders of Trigon Metals
Inc.		2,130,377	2,132,670
Non-controlling interest		(618,032)	(488,342)
Total Equity		1,512,345	1,644,328
Total Liabilities and Equity		$ 3,803,307	$ 2,430,872
Nature of operation and going concern (note 1)
Commitments and contingencies (note 16)
Subsequent events (notes 7, 16, 18)

Approved by the Board of Directors on July 28, 2021.

“Jed Richardson” “Larisa Sprott” _______ Jed Richardson _______ Larisa Sprott Director Director

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

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Trigon Metals Inc. Consolidated Statements of Loss and Comprehensive Loss

( Expressed in Canadian dollars)

Expressed in Canadian dollars)
		Years ended	March 31,
	Notes	2021	2020
Expenses
Consulting fees	15	$ 788,877	$	801,630
Professional fees		117,960		84,621
Share-based payments	13,15	-		443,110
Travel and related costs		418		54,986
Investors relations, promotion and filing fees		193,022		287,039
General and administrative costs		128,280		189,263
Exploration and evaluation expenditures	7,14	4,981,660		913,159
Depreciation	6	18,423		7,448
Foreign exchange loss		13,929		11,946
Total expenses before the undernoted		$ 6,242,569	$ 2,793,202
Other income (expense)
Interest income		3,962		-
Interest expense	9	(16,283)		(104,114)
Other income		23,243		-
Loss on disposal of equipment	6	(42,348)		(1,084)
Impairment of receivables		(115,621)		(30,217)
Accretionexpenses	14	(114,847)		-
Net loss and comprehensive loss		$(6,504,463)	$ (2,928,617)
Net loss and comprehensive loss attributable to:
Shareholders of Trigon Metals Inc.		$ (6,374,773)	$ (2,822,676)
Non-controllinginterest		(129,690)		(105,941)
		$(6,504,463)	$(2,928,617)
Loss per share
Basic and diluted		(0.06)		(0.05)
Weighted average number of common shares
outstanding
Basic and diluted		102,832,589	60,324,126

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

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Trigon Metals Inc. Consolidated Statements of Changes in Shareholders’ Equity

(Expressed in Canadian dollars)

(Expressed in Canadian dollars)
Notes	Number of common shares Share Capital Contributed surplus Warrants Deficit Total shareholders’ equity Non- controlling interest Total equity Attributable to equity owners of Trigon Metals Inc.
Balance as at March 31, 2019 Net loss for the year Private placements 12 Warrants issued 12,13 Share and warrant issue costs 12,13 Broker warrants issued 12,13 Options expired unexercised 13 Warrants expired unexercised 13 Share-basedpayments 13	45,857,539 $ 36,627,071 $ 720,042 $ 1,073,898 $ (38,842,961) $ (421,950) (382,401) (804,351) - - - - (2,822,676) (2,822,676) (105,941) (2,928,617) 44,609,320 5,029,432 - - - 5,029,432 - 5,029,432 - (1,321,275) - 1,321,275 - - - - - (69,781) - (25,465) - (95,246) - (95,246) - (25,520) - 25,520 - - - - - - (328,505) - 328,505 - - - - - - (563,708) 563,708 - - - - - 443,110 - - 443,110 - 443,110
Balance as at March 31, 2020	90,466,859 40,239,927 834,647 1,831,520(40,773,424) 2,132,670(488,342) 1,644,328
Net loss for the year Shares issued for exploration and evaluation property 12,14 Private placements 12 Warrants issued 12,13 Share and warrant issue costs 12,13 Broker warrants issued 12,13 Warrants exercised 12,13 Value of warrants exercised 12,13 Warrants expired unexercised 13 Reversal of issue costs on expired warrants 13 Options exercised 13 Value of options exercised 13 Options expired unexercised 13	- - - - (6,374,773) (6,374,773) (129,690) (6,504,463) 6,300,000 787,500 - - - 787,500 - 787,500 15,310,998 5,356,849 - - - 5,356,849 - 5,356,849 - (1,206,955) - 1,206,955 - - - - - (378,453) - (127,083) - (505,536) - (505,536) - (64,584) - 64,584 - - - - 3,914,166 720,167 - - - 720,167 - 720,167 - 157,244 - (157,244) - - - - - - - (333,582) 333,582 - - - - - - 5,211 (5,211) - - - 75,000 13,500 - - - 13,500 - 13,500 - 10,950 (10,950) - - - - - - -(78,660) - 78,660 - - -
Balance as at March 31, 2021	116,067,023 45,636,145 745,037 2,490,361 (46,741,166) 2,130,377 (618,032) 1,512,345

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

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Trigon Metals Inc. Consolidated Statements of Cash Flows

(Expressed in Canadian dollars)

			Years ended	March	31,
	Notes		2021		2020
Cash provided by (used in):
Operating activities
Net loss for the year		$	(6,504,463)	$	(2,928,617)
Adjustments for items not affecting cash:
Acquisition of exploration and evaluation property	14		3,362,351		-
Share-based payments	13		-		443,110
Depreciation	6		18,423		7,448
Interest expense	9		16,283		104,114
Accretion expense	14		114,847		-
Loss on disposal of property and equipment	6		42,442		1,084
Write off of receivables			115,621		30,217
Unrealized foreign exchange gain			(21,491)		7,033
Net cash from operating activities before
changes in working capital			(2,855,987)		(2,335,611)
Net changes in non-cash working capital
Change in amounts receivable			(93,852)		30,838
Change in prepaid expenses			(5,434)		(14,024)
Change in accounts payable and accured liabilities			75,248		(102,891)
Net cash flows used in operating activities			(2,880,025)		(2,421,688)
Investing activities
Purchase of property and equipment	6,14		(162,810)		-
Proceeds on disposal of property and equipment	6		38,314		8,865
Acquisition of exploration and evaluation properties	14		(865,122)		-
Equipment received from acquisition of exploration and
evaluation properties	14		94		-
Cash indebtedness from acquisition of exploration and
evaluation properties	14		(13)		-
Net cash flows(used in) provided by investing activities			(989,537)		8,865
Financing activities
Proceeds from private placements	12		5,356,849		5,029,432
Shares issued from warrants exercised	12,13		720,167		-
Shares issued from options exercised	12,13		13,500		-
Share and warrant issuance costs	12,13		(505,536)		(95,246)
Bridge financing	9		(434,505)		(1,035,632)
Net cash flowsprovided by financing activities			5,150,475		3,898,554
Increase in cash during the year			1,280,913		1,485,731
Cash-Beginning of year			2,051,421		565,690
Cash - End ofyear		$	3,332,334	$	2,051,421
Supplemental information
Shares and finder shares issued for property acquisition	12,14	$	787,500		-
Broker warrants issued	12,13	$	64,584	$	25,520

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

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

1. NATURE OF OPERATIONS AND GOING CONCERN

Trigon Metals Inc. (the “Company” or “Trigon”) was incorporated under the Business Corporations Act of Canada on April 1, 2005. On December 28, 2016, the Company changed its name from Kombat Copper Inc. to Trigon Metals Inc. and its stock symbol from “KBT” to “TM”. The Company’s head office is located at 130 Queens Quay East, Suite 1224, Toronto, Ontario M5A 0P6.

These consolidated financial statements were reviewed, approved and authorized for issue by the Board of Directors on July 28, 2021.

The principal business activities of Trigon and its subsidiaries (collectively, the “Company”) are the acquisition, maintenance, exploration and development of mines and mineral properties on the African continent. The business of exploring for minerals and mining involves a high degree of risk. Few properties that are explored are ultimately developed into producing mines. Significant time and major expenses 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 recoverability of the amounts shown for property and equipment is dependent upon the Company obtaining the necessary financing to complete the exploration, evaluation and development of its properties, the discovery of economically recoverable reserves and future profitable operations, or alternatively upon the Company’s ability to dispose of its interests on an advantageous basis.

Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest, in accordance with industry standards for the current stage of operations of such properties, these procedures do not guarantee the Company's title. Property title may be subject to government licensing requirements or regulations, unregistered prior agreements, unregistered claims, indigenous claims, and non-compliance with regulatory, social and environmental requirements. The Company’s property interests may also be subject to increases in taxes and royalties, renegotiation of contracts, political uncertainty and currency exchange fluctuations and restrictions.

Going concern

These consolidated financial statements have been prepared on the assumption that the Company 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. A different basis of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As at March 31, 2021, the Company had working capital of $2,139,702 compared with $1,319,587 as at March 31, 2020. During the year ended March 31, 2021, the Company incurred a net loss of $6,504,463 (2020: $2,928,617). The Company’s continuation as a going concern is dependent upon the successful results from its mineral property exploration activities and its ability to attain profitable operations and generate funds there from and/or raise equity capital or borrowings sufficient to meet current and future obligations. Management intends to finance operating costs over the next twelve months with current cash on hand, potential proceeds from the exercise of warrants/stock options, further private placements and borrowings, if available. During fiscal 2021 and 2020, the Company was able to raise funds through financings. However, there is no assurance that additional financing will be available on terms acceptable to the Company, or at all. These matters represent material uncertainties that cast significant doubt on the Company’s ability to continue as a going concern.

These consolidated financial statements do not reflect adjustments to the carrying value of assets and liabilities that would be necessary should the Company be unable to continue operations. Such adjustments could be material.

Novel Coronavirus (“COVID-19”)

The Company’s operations could be significantly adversely affected by the effects of a widespread global outbreak of a contagious disease, including the recent outbreak of respiratory illness caused by COVID-19. The Company cannot accurately predict the impact COVID-19 will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could further affect the Company’s operations and ability to finance its operations. Despite the severity of COVID-19 pandemic, there were no material impacts on the Company’s operations and finances for the year ended March 31, 2021.

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES

Statement of compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”), applicable to the preparation of consolidated financial statements and in accordance with accounting policies based on IFRS standards and International Financial Reporting Interpretations Committee (“IFRIC”) interpretations. The Company has consistently applied the accounting policies used in the preparation of these consolidated financial statements throughout all periods presented, as if these policies had always been in effect.

Basis of preparation

These consolidated financial statements have been prepared on a historical cost basis except for certain financial instruments, which are stated at their fair values. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting, except for cash flow information. All amounts have been rounded to the nearest dollars, unless otherwise indicated.

Consolidation

These consolidated financial statements incorporate the accounts of Trigon Metals Inc. and its subsidiaries, PNT Financeco Corp. (Barbados) 100%, Kombat Holdings (Namibia) (Pty) Ltd. (Namibia) 100%, Kombat Copper Mine (Pty) Ltd. (Namibia) 100% (up to the date of its dissolution on July 27, 2020), Trigon Mining (Namibia) (Pty) Ltd. (“TMN”) (Namibia) 80%, Technomine Africa Sarl (Morocco) 100% and Gazania Investments Nine (Pty) Ltd. (Namibia) 100%. All intercompany transactions, balances, income and expenses are eliminated on consolidation. The 20% of TMN not owned by the Company is owned by the Namibia State Mining Company and a local Namibian partner.

Subsidiaries consist of entities over which the Company is exposed to, or has rights to, variable returns as well as the ability to affect those returns through the power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date control is transferred to the Company and are de-consolidated from the date control ceases. These consolidated financial statements include all the assets, liabilities, revenues, expenses and cash flows of the Company and its subsidiaries after eliminating inter-entity balances and transactions.

For non-wholly owned, controlled subsidiaries, the net assets attributable to outside equity shareholders are presented as “non-controlling interests” in the equity section of the consolidated statement of financial position. Profit for the period that is attributable to non-controlling interests is calculated based on the ownership of the minority shareholders in the subsidiary. Warrants and stock options issued by subsidiaries, exercisable into subsidiary shares, are presented as a component of non-controlling interest in the consolidated statement of financial position.

When the Company ceases to have control, any retained interest in the entity is re-measured to its fair value at the date when control is lost, with the change in carrying amount recognized in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognized in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognized in other comprehensive income are reclassified to profit or loss.

The partial disposal of an interest resulting in loss of control meets the definition of a disposal group. A disposal group qualifies as a discontinued operation if it is a component of an entity that either has been disposed of, or is classified as held for sale, and:

• Represents a separate major line of business or geographical area of operations;

• Is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations; or

• Is a subsidiary acquired exclusively with a view to resale.

Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the consolidated statement of loss.

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Foreign currency transactions

The functional currency of an entity is the currency of the primary economic environment in which the entity operates. The Canadian dollar has been determined as the functional currency of the Company and all subsidiaries, and is the currency in which funds from financing activities (i.e. issuing debt and equity instruments) are generated and because the activities of the foreign operation are carried out as an extension of the reporting entity, rather than being carried out with a significant degree of autonomy.

Foreign currency transactions are translated into the functional currency of the entity in which they occur using the exchange rates prevailing at the dates of transactions. Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from the translation of monetary assets and liabilities denominated in currencies other than functional currency at period-end exchange rates are recognized in the consolidated statement of loss.

Property and equipment

Property and equipment are carried at cost, less accumulated depreciation and impairment losses. All property and equipment, with the exception of land and buildings, are depreciated on a straight-line basis over three to five years. Land is not depreciated and buildings are depreciated over 40 years.

Significant components of the property and equipment are recorded and depreciated separately. Residual values, method of depreciation and the useful lives of assets are revised annually and adjusted prospectively, if appropriate, if there is an indicator of a significant change since the last reporting date.

Impairment of non-financial assets

At the end of each reporting period, the Company reviews and evaluates the recoverable amount of its property and equipment and when events or changes in circumstances indicate that the carrying amounts of related assets or groups of assets might not be recoverable.

For the purpose of measuring recoverable amounts, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use (being the present value of the expected future cash flows of the relevant asset). Any resulting write-down of the excess of carrying value over the recoverable amount is charged to the consolidated statement of loss.

Exploration and evaluation expenditures

Exploration and evaluation expenditures comprise costs of the initial search for mineral deposits and performing a detailed assessment of deposits that have been identified as having economic potential. Exploration and evaluation costs are expensed as incurred and included in the consolidated statement of loss and until technical feasibility and commercial viability of extraction of reserves are demonstrable. Once a mine development decision has been made by the Company, subsequent expenditures incurred to develop the mine are capitalized to mine development assets. Exploration and evaluation costs include an allocation of administration and salary costs as determined by management.

Financial instruments

Financial assets

Initial recognition and measurement

Non-derivative financial assets within the scope of IFRS 9 are classified and measured as “financial assets at fair value”, as either fair value through profit or loss (“FVPL”) or fair value through other comprehensive income (“FVOCI”), and “financial assets at amortized costs”, as appropriate. The Company determines the classification of financial assets at the time of initial recognition based on the Company’s business model and the contractual terms of the cash flows.

All financial assets are recognized initially at fair value plus, in the case of financial assets not at FVPL, directly attributable transaction costs on the trade date at which the Company becomes a party to the contractual provisions of the instrument.

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Financial instruments (continued)

Financial assets (continued)

Subsequent measurement – financial assets at amortized cost

After initial recognition, financial assets measured at amortized cost are subsequently measured at the end of each reporting period at amortized cost using the Effective Interest Rate (“EIR”) method. Amortized cost is calculated by taking into account any discount or premium on acquisition and any fees or costs that are an integral part of the EIR. The Company’s cash and amounts receivable are recorded at amortized cost.

Subsequent measurement – financial assets at FVPL

Financial assets measured at FVPL include financial assets management intends to sell in the short term and any derivative financial instrument that is not designated as a hedging instrument in a hedge relationship. Financial assets measured at FVPL are carried at fair value in the consolidated statements of financial position with changes in fair value recognized in other income or expense in the consolidated statements of loss. The Company does not measure any financial assets at FVPL.

Subsequent measurement – financial assets at FVOCI

Financial assets measured at FVOCI are non-derivative financial assets that are not held for trading and the Company has made an irrevocable election at the time of initial recognition to measure the assets at FVOCI. The Company does not measure any financial assets at FVOCI.

After initial measurement, investments measured at FVOCI are subsequently measured at fair value with unrealized gains or losses recognized in other comprehensive income or loss in the consolidated statements of comprehensive loss. When the investment is sold, the cumulative gain or loss is not reclassified to profit or loss.

Dividends from such investments are recognized in other income in the consolidated statements of loss when the right to receive payments is established.

Derecognition

A financial asset is derecognized when the contractual rights to the cash flows from the asset expire, or the Company no longer retains substantially all the risks and rewards of ownership.

Impairment of financial assets

The Company’s only financial assets subject to impairment are amounts receivable, which are measured at amortized cost. The Company has elected to apply the simplified approach to impairment as permitted by IFRS 9, which requires the expected lifetime loss to be recognized at the time of initial recognition of the receivable. To measure estimated credit losses, accounts receivable have been grouped based on shared credit risk characteristics, including the number of days past due. An impairment loss is reversed in subsequent periods if the amount of the expected loss decreases and the decrease can be objectively related to an event occurring after the initial impairment was recognized.

Financial liabilities

Initial recognition and measurement

Financial liabilities are measured at amortized cost, unless they are required to be measured at FVPL as is the case for held for trading or derivative instruments, or the Company has opted to measure the financial liability at FVPL. The Company’s financial liabilities include accounts payable and accrued liabilities, acquisition fees payable and bridge financing, which are each measured at amortized cost. All financial liabilities are recognized initially at fair value.

Subsequent measurement – financial liabilities at amortized cost

After initial recognition, financial liabilities measured at amortized cost are subsequently measured at the end of each reporting period at amortized cost using the EIR method. Amortized cost is calculated by taking into account any discount or premium on acquisition and any fees or costs that are an integral part of the EIR. The EIR amortization is included in the consolidated statement of loss.

Derecognition

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires with any associated gain or loss recognized in other income or expense in the consolidated statements of loss.

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Provisions

Provisions are recognized when: (i) the Company has a present obligation (legal or constructive) as a result of a past event, and (ii) it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and (iii) a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

A provision for onerous contracts is recognized when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract. The Company had no material provisions as at March 31, 2021 and 2020.

Rehabilitation provision

The Company records the present value of estimated costs of legal and constructive obligations required to restore operating locations in the period in which the obligation is incurred. The nature of these restoration activities includes dismantling and removing structures, rehabilitating mines and tailings dams, dismantling operating facilities, closure of plant and waste sites, and restoration, reclamation and re-vegetation of affected areas.

The obligation generally arises when the asset is installed or the ground / environment is disturbed at the production location. When the liability is initially recognized, the present value of the estimated cost is capitalized by increasing the carrying amount of the related mining assets to the extent that it was incurred prior to the production of related ore. Over time, the discounted liability is increased for the change in present value based on the discount rates that reflect current market assessments and the risks specific to the liability. The periodic unwinding of the discount is recognized in the consolidated statement of loss as a finance cost. Additional disturbances or changes in rehabilitation costs will be recognized as additions or charges to the corresponding assets and rehabilitation liability when they occur. For closed sites, changes to estimated costs are recognized immediately in the consolidated statement of loss.

The Company had no material decommissioning obligations as at March 31, 2021 and 2020.

Income taxes

Income tax on the profit or loss for the periods presented comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.

Deferred tax is provided using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: goodwill not deductible for tax purposes and the initial recognition of assets or liabilities that affect neither accounting nor taxable profit. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the financial position reporting date.

A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.

Cash

Cash is comprised of cash on hand and deposits that generally mature within 90 days from the date of acquisition.

Prepaid expenses

Prepaid expenses represent payments made or obligations incurred in advance of the receipt of goods or rendering of services. Prepaid expenses are typically included in other current assets on the consolidated statement of financial position.

Page | 12

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Loss per share

Basic loss per share is calculated by dividing loss attributable to common shareholders by the weighted average number of common shares outstanding for the year. In the event of the Company reporting net profit, the diluted loss per share will be similar to basic loss per share, except that the denominator will be increased to include the number of additional shares that would have been outstanding if the dilutive potential common shares in connection with the issued share options and warrants had been issued using the treasury stock method. The Company’s options and warrants were anti-dilutive for the years ended March 31, 2021 and 2020.

Share-based payments

Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received.

The fair value of share-based payments is determined using the Black-Scholes option pricing model. The compensation expense is recognized over the period during which the options vest based on the estimate of equity instruments expected to vest. Upon exercise of the stock options, consideration paid by the option holder together with the amount previously recognized in contributed surplus is recorded as an increase to share capital. Unexercised expired stock options are transferred to accumulated deficit.

Warrants

Warrants are recognized at fair value on the date of grant and are measured using the Black-Scholes option pricing model. Upon exercise of warrants, consideration paid by the warrant holder together with the amount previously recognized in warrants is recorded as an increase to share capital. Unexercised expired warrants are transferred to accumulated deficit.

Contingencies

In assessing loss contingencies related to legal proceedings that are pending or unasserted claims that may result in such proceedings, the Company and its legal counsel evaluate the perceived merits of any legal proceedings or unasserted claims and the amount of relief sought or expected to be sought.

If the assessment of a contingency suggests that a loss is probable, the amount can be reliably estimated, and there is a present obligation as a result of a past event, then a loss is recorded. The details of a contingent loss are disclosed unless the possibility of any outflow in settlement is remote. Legal fees incurred with pending legal proceedings are expensed as incurred.

Operating segments

The Company has concluded that it has only one material operating segment (the development of its Namibian mining permits) for financial reporting purposes.

New accounting changes

On April 1, 2020, the Company adopted the amendments to refine the definition of materiality in IAS 1 – Presentation of Financial Statements and IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors that came into effect. These amendments did not have any material impact on the Company’s consolidated financial statements.

Future accounting changes

Certain new standards, interpretations, amendments and improvements to existing standards were issued by the IASB or IFRIC that are mandatory for annual accounting periods beginning on April 1, 2021 or later. Updates that are not applicable or are not consequential to the Company have been excluded. The following have not yet been adopted and are being evaluated to determine their impact on the Company.

Page | 13

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Future accounting changes (continued)

IAS 1 – Presentation of Financial Statements (“IAS 1”) was amended in January 2020 to provide a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangements in place at the reporting date. The amendments clarify that the classification of liabilities as current or noncurrent is based solely on a company’s right to defer settlement at the reporting date. The right needs to be unconditional and must have substance. The amendments also clarify that the transfer of a company’s own equity instruments is regarded as settlement of a liability, unless it results from the exercise of a conversion option meeting the definition of an equity instrument. The amendments are effective for annual periods beginning on January 1, 2023.

IAS 16 – Property, Plant and Equipment (“IAS 16”) was amended. The amendments introduce new guidance, such that the proceeds from selling items before the related property, plant and equipment is available for its intended use can no longer be deducted from the cost. Instead, such proceeds are to be recognized in profit or loss, together with the costs of producing those items. The amendments are effective for annual periods beginning on January 1, 2022.

IAS 37 – Provisions, Contingent Liabilities, and Contingent Assets (“IAS 37”) was amended. The amendments clarify that when assessing if a contract is onerous, the cost of fulfilling the contract includes all costs that relate directly to the contract – i.e. a full-cost approach. Such costs include both the incremental costs of the contract (i.e. costs a company would avoid if it did not have the contract) and an allocation of other direct costs incurred on activities required to fulfill the contract – e.g. contract management and supervision, or depreciation of equipment used in fulfilling the contract. The amendments are effective for annual periods beginning on January 1, 2022.

IFRS 3 – Business Combinations (“IFRS 3”) was amended. The amendments introduce new exceptions to the recognition and measurement principles in IFRS 3 to ensure that the update in references to the revised conceptual framework does not change which assets and liabilities qualify for recognition in a business combination. An acquirer should apply the definition of a liability in IAS 37 – rather than the definition in the Conceptual Framework – to determine whether a present obligation exists at the acquisition date as a result of past events. For a levy in the scope of IFRIC 21, the acquirer should apply the criteria in IFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date. In addition, the amendments clarify that the acquirer should not recognize a contingent asset at the acquisition date. The amendments are effective for annual periods beginning on January 1, 2022.

3. CRITICAL ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS

The preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reported period. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

The significant areas of judgement and estimation uncertainty considered by management in preparing the consolidated financial statements include:

Critical judgment in applying accounting policies:

• Assets’ carrying values and impairment charges

Events or changes in circumstances can give rise to significant impairment charges or reversals of impairment in a particular year. Management exercises its judgment in determining when such events or changes in circumstances have arisen and where such circumstances evidence a significant or prolonged decline of fair value on assets indicating impairment.

Page | 14

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

3. CRITICAL ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS (Continued)

Critical judgment in applying accounting policies: (continued)

• Commercial production

The determination of when the mine is in a condition necessary for it to be capable of operating in the manner intended by management (referred to as “commercial production”) is a matter of judgment that will impact when the Company recognizes revenue and operating costs in the consolidated statement of loss and depreciation and depletion commence. In making this determination, management considered whether (a) the major capital expenditures to bring the mine to the condition necessary for it to be capable of operating in the manner intended by management had been completed; (b) a reasonable period of commissioning had been completed; (c) consistent operating results have been achieved at the previously budgeted level of design capacity; and (d) the transfer of operations from the construction personnel to operations personnel had been completed. As at March 31, 2021, management and the Board has not declared for commercial production.

• Control of subsidiaries

The Company consolidates subsidiaries over which it has control. Management assesses control in accordance with IFRS 10 - Consolidated Financial Statements and has determined it controls each of its subsidiaries.

• Determination of functional currency

Based on the primary indicators in IAS 21 – The Effects of Change in Foreign Exchange Rates – the Canadian dollar has been determined as the functional currency of the Company and all subsidiaries as the Canadian dollar is the currency in which funds from financing activities (i.e. issuing debt and equity instruments) are generated and because the activities of the foreign operation are carried out as an extension of the reporting entity, rather than being carried out with a significant degree of autonomy. Effects of changes in foreign exchange rates are recorded as foreign exchange gain (loss) on the statement of loss. If the functional currency of the Namibian entities had been the Namibian dollar, the effect of changes in foreign exchange rates would have been reflected as other comprehensive income and carried as a cumulative translation adjustment within accumulated other comprehensive income in the equity section of the consolidated statement of financial position.

• Determination of discount rates

Determination of the discount rate for acquisition fees payable is based on comparison to similar interest bearing debt instruments of a group of comparative companies.

• Acquisitions

For acquisitions, the Company must make assumptions and estimates to determine the purchase price accounting of the assets and liabilities being acquired, as well as the expected outcomes of contingent items. To do so, the Company must determine the acquisition date fair value of the identifiable assets acquired and liabilities assumed. The determination of these fair market values are inherently subjective and require judgement. In addition the Company must consider whether the acquisition of a subsidiary or group of assets constitutes a business combination or an asset acquisition. This is done by considering whether the acquired group includes inputs and process or whether there is a concentration of assets being acquired. These assumptions and estimates have an impact on the asset and liability amounts recorded in the consolidated statement of financial position.

Key sources of estimation uncertainty:

• Depreciation rates

All property, plant and equipment, with the exception of land and buildings, are depreciated on a straight-line basis over three to five years, which the Company believes is the best approximation of the asset utility to the Company. If the estimated life had been longer than management’s estimate, the carrying amount of the asset would have been higher.

Page | 15

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

3. CRITICAL ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS (Continued)

Key sources of estimation uncertainty (Continued):

• Assets’ carrying values and impairment charges

The determination of carrying values and impairment charges and their individual assumptions require that management make an estimate based on the best available information at each reporting period. Under situations where management has determined indicators of impairment are present, an impairment assessment will be performed by management whereupon management looks at the higher of recoverable amount or fair value less costs to sell in the case of assets.

• Mineral Reserve and Mineral Resource estimates

The figures for Mineral Reserves and Mineral Resources are determined in accordance with National Instrument 43-101, “Standards of Disclosure for Mineral Projects”, issued by the Canadian Securities Administrators. There are numerous uncertainties inherent in estimating Mineral Reserves and Mineral Resources, including many factors beyond the Company’s control.

Such estimation is a subjective process, and the accuracy of any Mineral Reserve or Mineral Resource estimate is a function of the quantity and quality of available data and of the assumptions made and judgments used in engineering and geological interpretation. Differences between management’s assumptions, including economic assumptions such as metal prices and market conditions, and future circumstances could have a material effect in the future on the Company’s financial position and results of operation.

• Share-based payment transactions and warrants

The Company records share-based compensation at fair value over the vesting period. The Company also issues warrants. The fair value of the options and warrants is determined using the Black-Scholes options pricing model and management assumptions including the expected dividend yield, expected volatility, forfeiture rate, risk free rate and expected life. Should the underlying assumptions change, it will impact the fair value. Such judgments and assumptions are inherently uncertain. Changes in these assumptions affect the fair value estimates.

• Estimation of decommissioning and restoration costs and the timing of expenditure

The cost estimates are updated annually to reflect known developments, (e.g. revisions to cost estimates and to the estimated lives of operations) and are subject to review at regular intervals. Decommissioning, restoration and similar liabilities are estimated based on the Company’s interpretation of current regulatory requirements, constructive obligations and are measured at fair value. Fair value is determined based on the net present value of estimated future cash expenditures for the settlement of decommissioning, restoration or similar liabilities that may occur upon decommissioning of the mine. Such estimates are subject to change based on changes in laws and regulations and negotiations with regulatory authorities.

• Income, value added, withholding and other taxes

In assessing the probability of realizing income tax assets recognized, management makes estimates related to expectations of future taxable income, applicable tax planning opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax positions taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified. Estimates of future taxable income are based on forecasted cash flows from operations and the application of existing tax laws in each jurisdiction. The Company considers whether relevant tax planning opportunities are within the Company’s control, are feasible, and are within management’s ability to implement. Examination by applicable tax authorities is supported based on individual facts and circumstances of the relevant tax position examined in light of all available evidence. Where applicable tax laws and regulations are either unclear or subject to ongoing varying interpretations, it is reasonably possible that changes in these estimates can occur that materially affect the amounts of income tax assets recognized. Also, future changes in tax laws could limit the Company from realizing the tax benefits from the deferred tax assets. The Company reassesses unrecognized income tax assets at each reporting period.

Page | 16

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

3. CRITICAL ACCOUNTING ESTIMATES AND MANAGEMENT JUDGMENTS (Continued)

Key sources of estimation uncertainty (Continued):

• Income, value added, withholding and other taxes (continued)

The Company is subject to income, value added, withholding and other taxes. Significant judgment is required in determining the Company’s provisions for taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. The determination of the Company’s income, value added, withholding and other tax liabilities requires interpretation of complex laws and regulations. The Company’s interpretation of taxation law as applied to transactions and activities may not coincide with the interpretation of the tax authorities. All tax related filings are subject to government audit and potential reassessment subsequent to the financial statement reporting period. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the tax related accruals and deferred income tax provisions in the period in which such determination is made.

• Contingencies

Refer to Note 16.

4. AMOUNTS RECEIVABLE

	March 31, 2021	March 31, 2020
Sales taxes receivable	$ 56,143	$ 29,374
Trade and other receivable	414	4,579
	$ 56,557	$ 33,953

5. PREPAID EXPENSES

PREPAID EXPENSES
		March	31, 2021	March 31,2020
Insurance	$		9,066	$ 14,824
Deposit			850	793
Other			16,128	5,140
	$		26,044	$ 20,757

6. PROPERTY AND EQUIPMENT

Property and equipment are carried at cost less accumulated depreciation and impairment consist of the following:

			March 31,2021	March 31,2021			March 31,2020
			Accumulated		Net book		Accumulated	Net book
		Cost	Depreciation		value	Cost	Depreciation	value
Furniture	$	11,958	$	7,438	4,520 $ 6,300		$ 6,300 $ -
Vehicles		126,764		24,348	102,416	22,903	13,537	9,366
Buildings		60,920		10,659	50,261	60,920	9,136	51,784
Land		182,508		-	182,508	182,508	-	182,508
Equipment		127,571		78,904	48,667	155,036	73,953	81,083
	$	509,721	$	121,349$ 388,372$ 427,667			$ 102,926$ 324,741

Page | 17

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

6. PROPERTY AND EQUIPMENT (Continued)

Reconciliation of the carrying amounts for the years ended March 31, 2021 and 2020 are as follows:

	Furniture Vehicles Buildings	Land Equipment Total
Costs
Balance as at March 31,2019	$6,300$22,903$60,920	$182,508$164,985$437,616
Disposals	- - -	(9,949) (9,949)
Balance as at March 31,2020	$6,300$22,903$60,920	$182,508$155,036$427,667
Additions(Disposals)	5,658 103,861 -	- (27,465) 82,054
Balance as at March 31,2021	$11,958$126,764$60,920	$182,508$127,571$509,721
Accumulated depreciation, depletion and impairment
Balance as at March 31,2019	$ (6,300) $ (8,624) $ (7,614)	$-$ (72,940) $ (95,478)
Changes for theyear	-(4,913) (1,522)	-(1,013) (7,448)
Balance as at March 31,2020	$ (6,300) $ (13,537) $ (9,136)	$-$ (73,953) $ (102,926)
Changes for theyear	(1,138) (10,811) (1,523)	-(4,951) (18,423)
Balance as at March 31,2021	$ (7,438) $ (24,348) $ (10,659)	$-$ (78,904) $ (121,349)
Net book value as at March 31, 2020	$ - $ 9,366 $ 51,784	$ 182,508 $ 81,083 $ 324,741
Net book value as at March 31, 2021	$ 4,520 $ 102,416 $ 50,261	$ 182,508 $ 48,667 $ 388,372

7. EXPLORATION AND EVALUATION EXPENDITURES

	For the years ended March 31,	For the years ended March 31,	For the years ended March 31,
	2021	2020
Trigon Namibia
Feasibility studies	$ -	$ 172,140
Technical report	30,533		-
Environmental assessment	14,901		-
Assay and survey	30,510		3,557
Licence and permit	1,404		-
Field office and support	178,541	151,276
Consulting and labour	682,778	540,007
Travel	71,579	46,179
Preproduction costs	10,936		-
	$ 1,021,182	$913,159
Technomine, Morocco
Acquisition of exploration and evaluation property	$ 2,862,351	$	-
Drilling	258,257		-
Assay and survey	60,030		-
Field office and support	48,611		-
Consulting and labour	228,173		-
Travel	2,513		-
	$ 3,459,935	$	-

Page | 18

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

7. EXPLORATION AND EVALUATION EXPENDITURES (Continued)

	For the years ended March 31,	For the years ended March 31,
	2021	2020
Gazania Namibia
Acquisition of exploration and evaluation property	$ 500,000	$	-
Licence and permit	487		-
Field office and support	56		-
	$ 500,543	$	-
Total exploration and evaluation expenditures	$ 4,981,660	$913,159

The Company holds an effective 80% interest in its five mining licenses in Northern Namibia through its subsidiary, Trigon Mining (Namibia) (Pty) Ltd. The mining licenses expired in March 2019 and applications for their renewal were lodged by the Company. Subsequent to March 31, 2021, the Company was notified by the Namibian Ministry of Mines and Energy that they will be granted a renewal of licenses for its five land holdings for a 10 year period from June 2, 2021, subject to the completion of certain conditions.

On February 20, 2020, Trigon Mining (Namibia) (Pty) Ltd (“Trigon Namibia”), Trigon’s 80% owned subsidiary, was awarded a new Exclusive Prospecting Licence No. 7525 (“EPL 7525”) by the Ministry of Mines and Energy in Namibia for a three- year period, commencing on January 17, 2020, in respect of base and rare metals, industrial minerals and precious metals, subject to the terms and conditions of the Minerals (Mining and Prospecting) Act No. 33 of 1992 relating to exclusive prospecting licenses. EPL 7525 is situated to the west of the Kombat project and south of certain of the Company’s licenses related to the Kombat Mine.

On September 24, 2020, the Company acquired a 100% equity interest in Technomine Africa S.A.R.L. (“Technomine”), a Moroccan company from Technomine’s previous shareholders. Technomine owns a 100% interest in the Silver Hill Project in Morocco. See note 14 for details.

On February 25, 2021, the Company acquired a 100% equity interest in Gazania Investments Nine (Pty) Ltd, (Namibia) (“Gazania”), of which 80% from Sabre Resources Ltd., Australia and 20% from Coniston Pty Ltd., Australia. Gazania is the 100% owner of License EPL3540. See note 14 for details.

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

					March 31, 2021		March 31, 2020
		Current
		Trade payables		$	221,467	$	131,784
		Accruals			215,990		236,538
		Acquisition feespayable(Note 14)			837,776		-
				$	1,275,233	$	368,322
		Long term
		Acquisition feespayable(Note 14)			1,015,729		-
				$	2,290,962	$	368,322
	BRIDGE FINANCING
					March 31, 2021		March 31, 2020
		Aberdeen International Inc.	Unsecured loan			-	418,222
					$	- $ 418,222

9. BRIDGE FINANCING

Page | 19

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

9. BRIDGE FINANCING (Continued)

• (i) During fiscal 2019, the Company entered into loan agreements for bridge financing of $200,000 (“First loan”) and a further $250,000 (“Second loan”). Loan principal, together with accrued interest at 12% per annum, was due and payable on or before December 31, 2019. In September 2019, the Company repaid the principal and accrued interest of $526,701 in full.

• (ii) During fiscal 2019, the Company entered into loan agreements with Aberdeen International Inc. (“Aberdeen”) as follows:

	Date	Principal	Interest	Extended repayment date
Firstloan	May 30,2018	$200,000	12% perannum	January 31,2020
Secondloan	June26,2018	$275,000	12% perannum	January 31,2020
Amended second loan	September 4, 2018	$80,000	12% per annum	January 31, 2020
	December31,2018	$140,000	12% perannum	January 31,2020

Loan principal and accrued interest is due and payable in cash on or before the repayment date. The Company could negotiate repayment of the loans with Aberdeen via the transfer of securities or other investment products, but any arrangement for repayment other than in cash remained subject to a subsequent written agreement. Aberdeen extended the repayment date to January 31, 2020. In January 2020, the Company repaid loan principal of $285,000 and $120,000.

During the year ended March 31, 2021, the Company repaid the outstanding loan principals plus accrued interest of $434,505 in full.

Aberdeen was a 10% security holder of the Company on a partially diluted basis in fiscal 2020 but ceased to be a 10% security holder as of July 31, 2020.

• (iii) During fiscal 2019, the Company entered into a loan agreement with Sulliden Mining Capital Inc. (“Sulliden”) for $96,000. The amount owed was subject to 12% interest per annum. In September 2019, the Company repaid the loan principal plus accrued interest of $103,931 in full. Sulliden and the Company shared a common officer during the year ended March 31, 2020.

10. FINANCIAL INSTRUMENTS

Financial instruments measured at fair value on the consolidated statements of financial position are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

• Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

• Level 3 – Inputs that are not based on observable market data.

The Company’s financial instruments consist of cash, amounts receivable, bridge financing, accounts payable and accrued liabilities and acquisition fees payable . The fair value of these financial instruments approximates their carrying values due to the short-term nature of these instruments. The non-current portion of the acquisition fees payable are recorded at a 15% discount rate. The Company has no financial instruments recorded at fair value.

Page | 20

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

10. FINANCIAL INSTRUMENTS (Continued)

Financial assets and financial liabilities as at March 31, 2021 and 2020 were as follows:

	Assets	& liabilities	Assets & liabilities	Assets & liabilities
		at		at fair value		TOTAL
	amortized cost		through profit & loss
At March 31, 2021
Financial assets:
Cash	$	3,332,334	$	-	$	3,332,334
Amounts receivable (Note 4)		414		-		414
Financial liabilities:
Accounts payable and accrued liabilities		(437,457)		-		(437,457)
Acquisition fees payable		(1,853,505)				(1,853,505)
At March 31,2020
Financial assets:
Cash	$	2,051,421	$	-	$	2,051,421
Amounts receivable		4,579		-		4,579
Financial liabilities:
Accounts payable and accrued liabilities		(368,322)		-		(368,322)
Bridge financing		(418,222)		-		(418,222)

11. CAPITAL MANAGEMENT AND FINANCIAL RISK FACTORS

The Company considers its capital structure to include the components of shareholders’ equity. Management’s objective is to ensure that there is sufficient capital to minimize liquidity risk and to continue as a going concern. As the Company’s properties are in the exploration and evaluation stage, the Company is currently unable to self-finance its operations. Although the Company has been successful in the past in obtaining financing through the sale of equity securities, there can be no assurance that the Company will be able to obtain adequate financing in the future, or that the terms of such financings will be favourable.

Risk management is carried out by the management team under policies approved by the Board of Directors. The Company's capital management objectives, policies and processes have remained unchanged during the year ended March 31, 2021. The Company is not subject to any capital requirements imposed by a lending institution or regulatory body, other than of the TSX Venture Exchange (“TSXV”) which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required in order to maintain operations and cover general and administrative expenses for a period of 6 months. As of March 31, 2021, the Company believes it is compliant with the policies of the TSXV.

Financial risks

The Company's financial instruments comprise cash, amounts receivable, accounts payable and accrued liabilities, acquisition fees payable and bridge financing. The main use of these financial instruments is to fund operations and the pursuit of capital transactions. The main risks that could adversely affect the Company's financial assets, liabilities or future cash flows are credit risk, liquidity risk and market risk. The Company has limited interest rate risk as there are no outstanding variable rate borrowings and the Company finances its operations primarily through share offerings and short-term fixed interest rate debt.

Management mandates and agrees policies for managing each of these risks. The Company is exposed to a variety of financial risks by virtue of its activities including, but not limited to, those summarized below.

Page | 21

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

11. CAPITAL MANAGEMENT AND FINANCIAL RISK FACTORS (Continued)

Financial risks (continued)

The following discussion also includes a sensitivity analysis that is intended to illustrate the sensitivity to changes in market variables on the Company's financial instruments and show the impact on income or loss and shareholders' equity, where applicable. The sensitivity analysis has been prepared for the year ended March 31, 2021, using the amounts of other financial assets and liabilities held as at the consolidated statement of financial position date.

Credit risk

Credit risk arises when a failure by counterparties to discharge their obligations could reduce the amount of future cash inflows from financial assets. Not having a producing asset generating sales and accounts receivable, the Company’s credit risk is considered limited as there is no exposure to a single customer or counterparty. With respect to credit risk arising from financial assets of the Company, which comprise cash and minimal receivables, the Company's exposure to credit risk arises from default of counterparties, with a maximum exposure equal to the carrying amount of these instruments. As cash balances are held with high credit quality financial institutions, the credit risk to the Company is considered minimal. The Company monitors and is subject to normal industry credit risks.

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with financial liabilities as they come due. The Company’s ability to continue as a going concern is dependent on management’s ability to raise the required capital through future equity or debt issuances.

The Company manages its liquidity risk by forecasting cash flows required for operations and anticipating any investing and financing activities. Management and the Board of Directors are actively involved in the review, planning, and approval of significant expenditures and commitments.

The Company’s approach to managing liquidity risk is to endeavour to have sufficient liquidity to meet liabilities when due. As at March 31, 2021, the Company had a cash balance of $3,332,334 (March 31, 2020: $2,051,421) and amounts receivable other than sales taxes receivable of $414 (March 31, 2020: $4,579). As at March 31, 2021, the Company’s financial liabilities consisted of accounts payable and accrued liabilities of $435,573 (March 31, 2020: $368,322) based on contractual undiscounted payments, acquisition payable of $837,776 (March 31, 2020: $nil) and short-term borrowings of $Nil (March 31, 2020: $418,222), all due in less than one year plus long term liabilities of $1,015,729 (March 31, 2020: $Nil) due in two years.

During the year ended March 31, 2021, Trigon raised $5,358,849 through private placement financing, received $792,129 through warrants exercised, $13,500 through options exercised, repaid $290,000 of its short-term loan and made $144,505 in interest payments.

During fiscal 2020, Trigon raised $5,029,432 through private placement financings, repaid $951,000 of its debt and made $84,632 in interest payments.

Interest rate risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The risk that the Company will realize a loss as a result of a decline in the fair value of cash is limited due to the short-term investment nature. The Company’s outstanding loans and interest-bearing debts are subject to fixed interest rates, and the Company has not entered into any interest rate swaps or other rate program at his time.

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates, commodities and equity prices will affect the Company's income or the value of its holdings of financial instruments. The ability of the Company to explore, evaluate and develop its exploration and mining properties and the future profitability of the Company are directly related to the price of base and precious metals. The Company monitors metal prices to determine the appropriate course of action to be taken.

Page | 22

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

11. CAPITAL MANAGEMENT AND FINANCIAL RISK FACTORS (Continued)

Foreign currency risk

Foreign currency risk is created by fluctuations in the fair value or cash flows of financial instruments due to changes in foreign exchange rates and exposure as a result of investment in its subsidiaries. The Company is exposed to currency risk by incurring certain expenditures in US dollars, Namibian dollars, South African Rand and Australian dollars for its operations in Namibia and Moroccan Dirham and US dollars in Morocco. The Company has sought to minimize this risk by keeping its cash reserves in Canadian dollars and only purchasing US dollars, Namibian dollars, South African Rand and European Euro as needed.

Sensitivity analysis

The carrying amount of cash, accounts receivable, accounts payable and accruals equals fair market value. The effect of changes in foreign exchange rates on net loss is deemed insignificant as the number and amount of foreign-currency transactions are relatively small. Had the foreign exchange rates ben higher (lower) by 10%, the foreign exchange in the consolidated statement of loss would have been lower (higher) by approximately $(1,809) (year ended March 31, 2020: $(13,200)).

12. SHARE CAPITAL

(a) Authorized:

Unlimited number of voting common shares Unlimited number of non-voting preferred shares, issuable in series

(b) Issued:

Reconciliation of the number and value of common shares for the years ended March 31, 2021 and 2020 were as follows. All issued shares are fully paid.

		Issued
	Number of shares	Capital
Balance, March 31, 2019	45,857,539	36,627,071
Shares issued pursuant to private placements	44,609,320	5,029,432
Warrants issued	-	(1,321,275)
Broker warrants issued	-	(25,520)
Cost of issue	-	(69,781)
Balance, March 31, 2020	90,466,859	40,239,927
Shares issued pursuant to acquisition of exploration and
evaluation properties (Note 14)	6,000,000	750,000
Finder's shares issued pursuant to acquisition of exploration
and evaluation properties (Note 14)	300,000	37,500
Shares issued pursuant to private placements	15,310,998	5,356,849
Warrants issued	-	(1,206,955)
Broker warrants issued	-	(64,584)
Cost of issue	-	(378,453)
Warrants exercised	3,914,166	720,167
Value of warrants exercised	-	157,244
Options exercised	75,000	13,500
Value of options exercised	-	10,950
Balance, March 31, 2021	116,067,023	45,636,145

Page | 23

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

12. SHARE CAPITAL (Continued)

On September 24 and 25, 2019, the Company closed the first and second tranches of a non-brokered private placement financing. The Company issued 14,609,320 units at a price of $0.10 per unit for gross proceeds of $1,460,932. Each unit is comprised of one common share of Trigon and one half of one common share purchase warrant. Each warrant entitles the holder to acquire one common share at a price of $0.15 for a period of 24 months following the closing date of the offering. The Company also issued 98,210 broker warrants. Each broker warrant entitles the holder to acquire one common share at a price of $0.15 for a period of 24 months following the closing date of the offering. The issue date fair value of the warrants and broker warrants was estimated at $238,938 and $8,581 using the Black Scholes option pricing model with the following assumptions: expected share price of $0.08, expected dividend yield of 0%; expected volatility of 100.6% (based on the Company’s historical volatility); risk-free interest rate of 1.52% and an expected life of 2 years. The Company also paid share and warrant issue costs of $23,126. Sulliden subscribed a total of 2,039,310 units for gross proceeds of 203,931. Sulliden and the Company shared a common officer during the year ended March 31, 2020.

On January 8, 2020, the Company closed a non-brokered private placement financing. The Company issued 30,000,000 units at a price of $0.12 per unit for gross proceeds of $3,600,000. Each unit is comprised of one common share of Trigon and one common share purchase warrant. Each warrant entitles the holder to acquire one common share of Trigon at a price of $0.20 for a period of 36 months following the closing date of the financing. The Company also issued 187,450 broker warrants. Each broker warrant entitles the holder to acquire one common share at a price of $0.20 for a period of 36 months following the closing date of the financing. The issue date fair value of the warrants and broker warrants was estimated at $1,082,337 and $16,939 using the Black Scholes option pricing model with the following assumptions: expected share price of $0.08, expected dividend yield of 0%; expected volatility of 97.1% (based on the Company’s historical volatility); risk-free interest rate of 1.65% and an expected life of 3 years. The Company also paid share and warrant issue costs of $72,120 and wrote-off uncollectible subscription of $31,500.

Of the total subscription, Eric Sprott, a beneficial owner of 2176423 Ontario Ltd., acquired through his company 16,666,666 units or 19.99% of Trigon on a non-diluted basis and 32.36% on a partially diluted basis. In addition, Aberdeen, a 10% security holder on a partially diluted basis, acquired 2,375,000 units. A former officer also acquired 250,000 units. Their participation will be considered to be a “related party transaction” as defined under MI 61-101. The Insider Participation is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101.

On September 24, 2020, the Company closed its previously announced brokered private placement financing comprised of 13,721,042 units at a purchase price of $0.35 per unit for gross proceeds of $4,802,365. Concurrently with the offering, the Company completed a non-brokered private placement of 117,957 units for gross proceeds of $41,285. Each Unit is comprised of one common share of Trigon and one-half of one Common Share purchase warrant. Each whole warrant entitles the holder to acquire one common share at a price of $0.45 for a period of 36 months following the date of closing. The Offering was led by Cormark Securities Inc. on behalf of a syndicate of agents that included M Partners Inc. (collectively, the “Agents”). As consideration for their services provided in connection with the offering, the Company has (i) paid the Agents a cash commission equal to 6% of the gross proceeds of the offering, other than in respect of certain purchases by persons on the President’s List, on which the cash commission was equal to 1.5%, and (ii) issued to the Agents and the selling group that number of broker warrants as is equal to 3% of the aggregate number of units sold pursuant to the Offering (other than the portion thereof attributable to the President’s List, in respect of which no broker warrants were issued). Each broker warrant is exercisable to acquire one common share at a price of $0.45 per share for a period of 36 months following the date hereof. All of the securities issued by the Company pursuant to the Offering will be subject to a four month statutory hold period which expires on January 25, 2021. The Company paid a total of $354,842 in share issue costs and issued 6,919,499 warrants and 289,116 broker warrants. The issue date fair value of the warrants and broker warrants was estimated at $1,090,972 and $64,584 using the Black Scholes option pricing model with the following assumptions: expected dividend yield of 0%; expected volatility of 112.1% (based on the Company’s historical volatility); risk-free interest rate of 0.26% and an expected life of 3 years.

A 10% security holder of the Company, 2176423 Ontario Ltd., subscribed for 1,715,000 units under the offering. Each transaction with an insider of the Company constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company is relying on exemptions from the formal valuation requirements of MI 61-101 pursuant to section 5.5(a) and the minority shareholder approval requirements of MI 61-101 pursuant to section 5.7(1)(a) in respect of such insider participation as the fair market value of the transaction, insofar as it involves interested parties, does not exceed 25% of the Company’s market capitalization.

Page | 24

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

12. SHARE CAPITAL (Continued)

On October 13, 2020, the Company closed the second and final tranche (the “Second Tranche”) of its previously announced brokered private placement financing on October 13, 2020. In this Second Tranche, the Company issued 1,471,999 units at a price of $0.35 per Unit for aggregate gross proceeds of $513,200. Each unit is comprised of one common share of Trigon and one-half of one common share purchase warrant. Each whole warrant entitles the holder to acquire one common share at a price of $0.45 for a period of 36 months following the closing date of the offering. The offering was led by Cormark Securities Inc. on behalf of a syndicate of agents that included M Partners Inc. (collectively, the “Agents”). As consideration for their services provided in connection with the Second Tranche, the Company has paid the Agents a cash commission equal to $7,728 and incurred additional share issue costs of $21,031. The Company also paid an aggregate amount of $57,548 to other arm’s length finders as part of the First and Second Tranche of the Offering. All of the subscribers in the Second Tranche were on the Company’s President’s List. The issue date fair value of the warrants and was estimated at $115,983 using the Black Scholes option pricing model with the following assumptions: expected share price of $0.27, expected dividend yield of 0%; expected volatility of 112.0% (based on the Company’s historical volatility); risk-free interest rate of 0.23% and an expected life of 3 years.

13. EQUITY RESERVES

								Grant Date
		Weighted			No. of	Weighted	Fair Value of
		Average	Grant Date		Warrants,	Average		Warrants,
		Exercise	Fair Value of		Broker	Exercise		Broker
	No. of Options	Price		Options	Warrants	Price		Warrants		TOTAL
March 31, 2019	2,024,000	$0.48	$	720,042	9,059,245	$0.50	$	1,073,898	$	1,793,940
Granted	3,035,000	$0.18		443,110	37,590,320	$0.19		1,346,795		1,789,905
Expired	(785,000)	$0.61		(328,505)	(3,131,749)	$0.87		(571,291)		(899,796)
Warrant issue costs	-	-		-	-	-		(17,882)		(17,882)
March 31, 2020	4,274,000	$0.24	$	834,647	43,517,816	$0.21	$	1,831,520	$	2,666,167
Granted	-	-		-	7,944,614	$0.45		1,271,539		1,271,539
Exercised	(75,000)	$0.18		(10,950)	(3,914,166)	$0.18		(157,244)		(168,194)
Expired	(114,000)	$0.85		(78,660)	(2,321,666)	$0.40		(333,582)		(412,242)
Warrant issue costs(net)	-	-		-	-	-		(121,872)		(121,872)
March 31, 2021	4,085,000	$0.22	$	745,037	45,226,598	$0.24	$	2,490,361	$	3,235,398

Options

Under the Company’s stock option plan, the Company may grant options to its directors, officers, employees and consultants for up 10% of the outstanding common stock. Under the plan, the exercise price of each option must not be less than the market price of the Company’s stock on the date of grant, less any allowable discount. The maximum term of a stock option is five years.

On October 21, 2019, the Company granted 3,035,000 stock options to certain directors, officers, consultants and employees to acquire shares of the Company at $0.18 until October 21, 2024. The options vested immediately on the date of the grant and will expire five years from the date of grant. The fair value of the options was estimated using the Black Scholes option pricing model with assumptions based on expected share price of $0.18, dividend yield of 0%, expected volatility based on the Company’s historical volatility of 115%, risk free interest rate of 1.57% and expected life of 5 years. Of the total options granted, 1,950,000 options were granted to officers and directors of the Company.

There were no options granted during the year-ended March 31, 2021. The weighted average life of total outstanding options is 2.98 years as at March 31, 2021 (2020 – 3.91 years).

Page | 25

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

13. EQUITY RESERVES (Continued)

Options (continued)

As at March 31, 2021, the Company had stock options outstanding and exercisable as follows:

								Expected
		Number	Number	Exercise	Grant date fair		Dividend	volatility	Expected	Risk free
Grant date	Expiry date	outstanding	exercisable	price		value	yield(%)	(%)	life(years)	rate(%)
22-Jun-16	22-Jun-21	150,000	150,000	$0.50	$	61,500	0	120	5	0.70
19-Jul-17	19-Jul-22	550,000	550,000	$0.385		173,086	0	117	5	1.52
11-Aug-17	11-Aug-22	25,000	25,000	$0.24		4,743	0	110	5	1.46
11-Oct-17	11-Oct-22	25,000	25,000	$0.415		8,540	0	119	5	1.77
16-Oct-17	16-Oct-22	25,000	25,000	$0.45		9,008	0	113	5	1.71
06-Jun-18	06-Jun-23	350,000	350,000	$0.20		56,000	0	112	5	2.16
21-Oct-19	21-Oct-24	2,960,000	2,960,000	$0.18		432,160	0	115	5	1.57
		4,085,000	4,085,000		$	745,037

Warrants

As at March 31, 2021, the Company had share purchase warrants outstanding as follows:

							Expected
			Number	Exercise	Grant date fair	Dividend	volatility	Expected	Risk free
	**Grant date **	Expiry date	outstanding	price	value	yield (%)	(%)	life (years)	rate (%)
Warrants on units	01-Oct-18	01-Oct-21	3,166,664	$0.25	$ 143,347	0	97	3	2.31
Warrants on units	24-Sep-19	24-Sep-21	4,504,660	$0.15	147,349	0	101	2	1.52
Broker warrants	24-Sep-19	24-Sep-21	98,210	$0.15	8,581	0	101	2	1.52
Warrants on units	25-Sep-19	25-Sep-21	500,000	$0.15	16,355	0	101	2	1.52
Warrants on units	08-Jan-20	08-Jan-23	28,825,000	$0.20	1,039,946	0	97	3	1.65
Broker warrants	08-Jan-20	08-Jan-23	187,450	$0.20	16,939	0	97	3	1.65
Warrants on units	24-Sep-20	24-Sep-23	6,919,499	$0.45	1,090,972	0	112	3	0.26
Warrants on units	13-Oct-20	23-Oct-23	735,999	$0.45	115,983	0	112	3	0.23
Broker warrants	24-Sep-20	24-Sep-23	289,116	$0.45	64,584	0	112	3	0.26
Warrant issue costs					(153,695)
			45,226,598		$ 2,490,361

The weighted average life of total outstanding warrants is 1.67 years as at March 31, 2021 (2020 – 2.32 years).

14. ACQUISITION OF EXPLORATION AND EVALUATION PROPERTIES

Technomine Africa S.A.R.L. (“Technomine”)

On September 24, 2020, the Company completed the acquisition of a 100% equity interest in Technomine, which owns a 100% interest in the Silver Hill Project (“Silver Hill”) in Morocco.

Page | 26

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

14. ACQUISITION OF EXPLORATION AND EVALUATION PROPERTIES (Continued)

Technomine Africa S.A.R.L. (“Technomine”) (continued)

Terms of the Transaction

Under the terms of the Definitive Agreement, the Company acquired a 100% equity interest in Technomine for consideration detailed below:

1. Pay to the Vendors $500,000 in cash (paid) and issue 6,000,000 common shares (issued) on closing of the Transaction (the “First Payment”). The common shares were value at $750,000 based on their trading price subsequent to the signing of the share purchased agreement.

2. On the one-year anniversary of the closing of the Transaction, Trigon must pay to the Vendors $400,000, and issue such number of Trigon common shares equal to $250,000 (based on their trading price at the time) (the “Second Payment”).

3. Upon the completion of an independent National Instrument 43-101 compliant mineral resource estimate at the Project showing at least 100,000 tonnes of contained copper and/or equivalent, Trigon shall issue such number of shares equal to $1,250,000 (based on their trading price at the time) to the Vendors.

In addition, the Company paid $25,000 cash and issued 300,000 common shares to Majilias Inc. for its role as an arm’s length finder. The common shares were value at $37,500 based their trading price subsequent to the signing of the share purchased agreement. The finder shall also be entitled to a finder’s fee of 5% in cash and share consideration comprising the Second Payment, when paid by Trigon.

Purchase price consideration

The acquisition is being treated as an asset acquisition for accounting purposes as Silver Hill does not meet the definition of a business, as defined in IFRS 3, Business Combinations. The assets acquired and liabilities assumed were recorded at their estimated fair market values, which are based on management estimates.

Purchase price:
Cash consideration	$	500,000
Share consideration		750,000
Finders fees and shares		62,500
Future Obligations		1,538,658
Legal / Due diligent costs
Asafo & Co.		40,122
Total Purchaseprice	$	2,891,280
Fair value of assets acquired and liabilities assumed:
Amount receivable and prepaid	$	44,750
Fixed assets		94
Accounts payable and accrued liabilities		(15,902)
Cash		(13)
Total net asset acquired	$	28,929
Excess of purchase price over fair value
of assets acquired	$	2,862,351

The future obligations are the net present value of future payments discounted at 15%. As of March 31, 2021, the future obligations are adjusted to $1,653,505 (September 24, 2020 - $1,538,658) and $114,847 of accretion expenses was charged to the Company’s statement of loss and comprehensive loss. The current portion of the future obligations of $837,776 is due within a year and are included in the current accounts payable and accrued liabilities. The long term portion of the future obligation of $1,015,729 is due within two years and included in the non-current accounts payable and accrued liabilities.

Page | 27

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

14. ACQUISITION OF EXPLORATION AND EVALUATION PROPERTIES (Continued)

Gazania Invesmtnets Nine (Pty) Ltd. (“Gazania”)

On February 25, 2021, the Company completed the transaction to expand its land holding in Namibia, through the acquisition (the “Acquisition”) of exclusive prospecting licence 3540 (“EPL 3540”, or the “Licence”) held by Gazania which was 80% owned by Sabre Resources Limited (“Sabre”), through Sabre’s wholly owned subsidiary, Starloop Holdings Pty Ltd. (“Staloop”), and 20% owned by Coniston Pty Ltd. (“Coniston”). The Licence was first granted on October 30, 2006 and has been renewed several times, with a current expiry date of May 7, 2021. Gazania has submitted a renewal application for the Licence.

Terms of the Acquisition

The acquisition was implemented by way of the acquisition by Trigon, through its wholly owned subsidiary, PNT Financeco Corp., of 80% of the shares in Starloop from Sabre (the “Starloop Shares”) and 20% of the shares in Gazania from Coniston (the “Gazania Shares”).

As consideration for the Starloop Shares, Trigon paid $200,000 on fulfilment of the conditions precedent to the sale and purchase agreement signed with Sabre (“Sabre Agreement”). A second tranche cash payment of $100,000 is payable to Sabre on the renewal of the Licence by the Namibian Ministry of Mines and Energy, subject to such renewal being granted within three years of signature of the Sabre Agreement.

As consideration for the Gazania Shares, Trigon paid $1,000 on fulfilment of the conditions precedent to the sale and purchase agreement signed with Coniston (“Coniston Agreement”). A second tranche cash payment of $100,000 is payable to Coniston on the renewal of the Licence by the Namibian Ministry of Mines and Energy, subject to such renewal being granted within three years of signature of the Coniston Agreement. Trigon has also paid a facilitation fee of $99,000 to Kalgoorlie Mine Management Pty Ltd for its assistance in facilitating and documenting the acquisition. The acquisition is an arm’s length transaction.

Purchase price consideration

The acquisition is being treated as an asset acquisition for accounting purposes as Gazania does not meet the definition of a business, as defined in IFRS 3, Business Combinations. The assets acquired and liabilities assumed were recorded at their estimated fair market values, which are based on management estimates.

Purchase price:
Sabre on signing	$	200,000
Coniston on signing		1,000
Kalgoorlie Mine Management - faciliation fees		99,000
Milestone payment - Sabre		100,000
Milestonepayment - Coniston		100,000
	$	500,000
Fair value of assets acquired and liabilities assumed:
VAT		1,907,964
VAT impairment		(1,907,964)
	$	-
Excess ofpurchaseprice over fair value of assets acquired	$	500,000

The Company has estimated that the Licence renewal will be granted within a year. As such, the future obligations of $200,000 are included in current accounts payable and accrued liabilities as of March 31, 2021.

Page | 28

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

15. RELATED PARTY TRANSACTIONS

Compensation of key management

Key management includes the Company’s directors and officers. Compensation awarded to key management included:

	Years	ended March 31,
	2021	2020
Consulting fees	$ 467,500	$ 455,000
Share-basedpayments	-	284,700
	$ 467,500	$ 739,700

See also Notes 12, 13 and 16.

Included in accounts payable and accrued liabilities as at March 31, 2021 was approximately $30,234 for consulting fees and expenses (March 31, 2020: $31,871) charged by current and former officer and director of the Company. Such amounts are unsecured, non-interest bearing and with no fixed terms of payment.

16. COMMITMENTS AND CONTINGENCIES

Management contracts

The Company is party to certain management contracts and severance obligations. These contracts contain clauses requiring additional payments of up to $873,000 to be made to the officers of the Company upon the occurrence of certain events such as a change of control. As the triggering effect has not taken place, the contingent payments have not been reflected in these consolidated financial statements. Additional minimum management contractual commitments remaining under the agreements are approximately $472,000, all due within one year.

The Company also has a commitment of $25,000 for bonus payments for which the triggering event has not occurred as at March 31, 2021. Upon the occurrence of the triggering event, the Company will also have an increase in commitments relating to the subsequent occurrence of certain events such as a change of control or termination of the management contracts.

Legal claims

From time to time, the Company is named as a party to claims or involved in proceedings, including legal, regulatory and tax related, in the ordinary course of its business. While the outcome of these matters may not be estimable at period end, the Company makes provisions, where possible, for the estimated outcome of such claims or proceedings. Should a loss result from the resolution of any claims or proceedings that differs from these estimates, the difference will be accounted for as a charge to net loss in that period.

Environmental

The Company’s mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. The Company believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.

Kombat Project

On April 23, 2012, the Company purchased, through the acquisition of Trigan Namibia, an effective 80% interest in the mining assets commonly known as the Kombat mine, whose assets include a 100% interest in five mining licenses and one exclusive prospecting license in northern Namibia. As at March 31, 2021, the Company has expended sufficient capital to ensure the licenses remain in good standing. The mining licenses expired in March 2019. Subsequent to March 31, 2021, the Company was notified by the Namibian Ministry of Mines and Energy that they will be granted a renewal of licenses for its five land holdings for a 10 year period from June 2, 2021, subject to the completion of certain conditions.

Page | 29

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

16. COMMITMENTS AND CONTINGENCIES

Silver Hill Project

The Company completed its acquisition of 100% equity interest in Technomine, a Moroccan company from Technomine’s shareholders on September 24, 2020. The Company is required to meet the terms of transaction outlined in the definitive agreement as consideration of the acquisition. See note 14 for details.

Gazania EPL 3540

The Company completed its acquisition of 100% equity interest in Gazania, holder of EPL 3540 mining licence on February 25, 2021. The Company is required to make milestone payments if renewal of the Licence is granted by the Ministry of Mines and Energy in Namibia within three years. See note 14 for details.

17. INCOME TAXES

a) Provision for income taxes

Major items causing the Company's effective income tax rate to differ from the combined Canadian federal and provincial statutory rate of 26.5% (2020 - 26.5%) were as follows:

	2021 2020 $ $
Combined Canadian statutory income tax rate (Loss) before income taxes	26.50% 26.50% (6,504,463) (2,928,617)
Expected income tax recovery based on statutory rate Adjustment to expected income tax benefit: Stock based compensation Non-deductible expenses and other Changes and differences in tax rates Change in benefit of tax assets recognized	(1,724,000) (776,000) - 117,000 1,099,000 256,000 150,000 40,000 475,000 363,000
Deferred income tax provision (recovery)	- -
b) Deferred income tax
Deferred tax assets (liabilities) have been recognized as follows: Property and equipment - Namibia Non-capital loss carry-forward-Namibia	2021 2020 $ $
	(56,000) (39,000) 56,000 39,000
Total	- -

Deferred income tax assets have not been recognized in respect of the following deductible temporary differences:

Page | 30

Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

17. INCOME TAXES (Continued)

b) Deferred income tax (continued)

b) Deferred income tax (continued)
	2021	2020
	$	$
Share issuance costs - Canada	539,000	120,000
Exploration and evaluation expenditures - Canada	295,000	295,000
Non-capital loss carry-forwards - Canada	14,406,000	13,100,000
Non-capital loss carry-forwards - Barbados	265,000	235,000
Non-capital loss carry-forwards - Namibia	3,172,000	3,247,000
Non-capital loss carry-forwards-Morocco	455,000	-

Deferred tax assets have not been recognized in respect of these temporary differences as it is not probable that future taxable profit will be available against which the Company can utilize the benefits.

c) Losses carried forward

As at March 31, 2021, the Company had estimated non-capital losses for Canadian income tax purposes of approximately $14,406,000 (2020 - $13,100,000) available to use against future taxable income. The non-capital losses expire between 2032 and 2041.

The Company's Barbados subsidiaries have non-capital losses of approximately $265,000 (2020 - $235,000) available to use against future taxable income, expiring between 2021 and 2028.

The Company's Moroccan subsidiaries have non-capital losses of approximately $455,000 (2020 - $nil) available to use against future taxable income, expiring in 2025.

In addition, the Company's Namibian subsidiaries have non-capital losses of approximately N$39,085,000 (2020 - N$37,851,000) available to use against future taxable income. These non-capital loss may be carried forward indefinitely:

Expiry	Canada Barbados Namibia Morocco Total
2021 2022 2023 2024 2025 2026 2027 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 Indefinitely	- 19,000 - - 19,000 - 155,000 - - 155,000 - 27,000 - - 27,000 - 15,000 - - 15,000 - 2,000 - 455,000 457,000 - 8,000 - - 8,000 - 9,000 - - 9,000 1,951,000 - - - 1,951,000 1,657,000 - - - 1,657,000 976,000 - - - 976,000 1,289,000 - - - 1,289,000 1,089,000 - - - 1,089,000 1,316,000 - - - 1,316,000 1,792,000 - - - 1,792,000 1,519,000 - - - 1,519,000 1,511,000 - - - 1,511,000 1,306,000 - - - 1,306,000 - - 3,321,000 - 3,321,000
	14,406,000 $ 265,000 $ 3,321,000 $ 455,000 $ 18,447,000 $

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Trigon Metals Inc. Notes to the Consolidated Financial Statements For the years ended March 31, 2021 and 2020 (Expressed in Canadian dollars)

18. SUBSEQUENT EVENT

Subsequent to March 31, 2021, 12,465,664 warrants were exercised for gross proceeds of $2,310,475.

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