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Item 1. Financial Statements

2024-08-13 compared with 2024-05-14 · 356 added, 237 removed, 653 unchanged (48% of the section changed)

Item 1 - Financial Statements

March 31, 2024

June 30, 2024

December 31, 2023

27 unchanged sentences

10,365,914 shares

issued and 9,613,604 shares outstanding as of March 31, 2024;

issued and 10,363,434 shares outstanding as of June 30, 2024;

9,454,233 shares issued and 9,451,753 shares outstanding as of December 31, 2023

Additional paid-in capital

Treasury stock at cost ( 2,480 at March 31, 2024;

Treasury stock at cost ( 2,480 at June 30, 2024;

and 2,480 shares at December 31, 2023)

7 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Claim rental expense

2 unchanged sentences

Accretion expense

Impairment from loss, net of recovery

General and administrative expense

13 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

3 unchanged sentences

Accretion expense

Impairment expense

Loss from equity investment in Peak Gold, LLC

1 unchanged sentence

Interest expense paid in stock

Change in the fair value of contingent consideration

Amortization of debt discount and debt issuance fees

Changes in operating assets and liabilities:

Increase in prepaid expenses and other

Decrease in accounts payable and accrued liabilities

Decrease (increase) in prepaid expenses and other

Increase (decrease) in accounts payable and accrued liabilities

Net cash used in operating activities

6 unchanged sentences

Cash paid for shares withheld from employees for payroll tax withholding

Cash proceeds from warrant exercise

Cash proceeds from debt

2 unchanged sentences

Net cash provided by financing activities

NET DECREASE IN CASH

NET INCREASE IN CASH

CASH AND RESTRICTED CASH, BEGINNING OF PERIOD

3 unchanged sentences

Interest expense

Non-cash investing and financing activities

Commitment fee dercognized and added to debt discount

Total non-cash investing and financing activities

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

3 unchanged sentences

Equity/(Deficit)

Balance at March 31, 2024

( 159,539,085

Stock-based compensation

Common stock issuance

Cost of common stock issuance

Issuance of warrants

Stock issued for convertible note interest payment

Net loss for the period

Balance at June 30, 2024

( 178,084,838

Stockholders’

Equity/(Deficit)

Balance at March 31, 2023

Stock-based compensation

Common stock issuance

Cost of common stock issuance

Treasury shares issued in common stock issuance

Warrant modification

Fair value of warrants issued with common stock

Treasury shares issued for convertible note interest payment

Stock issued for convertible note interest payment

Treasury shares withheld for employee taxes

Net loss for the period

Balance at June 30, 2023

Stockholders’

Equity/(Deficit)

Balance at December 31, 2023

4 unchanged sentences

Cost of common stock issuance

Issuance of warrants

Stock issued for convertible note interest payment

Net loss for the period

Balance at March 31, 2024

Balance at June 30, 2024

( 178,084,838

5 unchanged sentences

Common stock issuance

Treasury shares issued in common stock issuance

Cost of common stock issuance

Treasury shares issued in common stock issuance

Warrant modification

Fair value of warrants issued with common stock

Treasury shares issued for convertible note interest payment

Stock issued for convertible note interest payment

1 unchanged sentence

Net loss for the period

Balance at March 31, 2023

Balance at June 30, 2023

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

29 unchanged sentences

The Peak Gold JV management committee (the “JV Management Committee”) has approved budgets for 2023 and 2024, with cash calls totaling approximately to $ 248.1 million, of which the Company’s share is approximately $ 74.5 million.

As of March 31, 2024, the Company has funded $ 62.7 million of the budgeted cash calls.

Work on the Lucky Shot Property has been ongoing since late 2021.

Underground work includes rehabilitation of approximately 442 meters of existing drift and the addition of 612 meters of new drift and 3,816 meters of underground HQ core exploration drilling.

In August 2023, the Company began executing a program to complete surface drilling on the Coleman segment of the Lucky Shot vein.

The program was shut down in September 2023 due to challenging weather conditions.

The Company had to contribute an unbudgeted cash call in July 2024 for $ 4.1 million.

As of June 30, 2024, the Company has funded $ 74.5 million of the budgeted cash calls and the $ 4.1 million unbudgeted cash call in July 2024.

The Company does not anticipate any further cash calls.

The Lucky Shot project remains in care and maintenance as the Company plans a surface and underground drilling program for 2025.

On the Shamrock and Eagle/Hona Properties, the Company conducted surface mapping and sampling programs during 2021.

7 unchanged sentences

The consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes included in the Company’s Form 10-KT for the six-month period ended D ecember 31, 2023 and its Form 10-K for the fiscal year ended June 30, 2023.

The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2024.

The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2024.

The Company’s cash needs going forward will primarily relate to capital calls from the Peak Gold JV, exploration of the Contango Properties, repayment of debt and related interest and general and administrative expenses of the Company.

The JV Management Committee has proposed a significant budget to complete the required development to start the operations of the Manh Choh mine, which is anticipated to begin production early in the third quarter of 2024.

In 2024, it is anticipated that there will be $ 27.2 million of capital calls to the Peak Gold JV to reach production, $ 15.5 million of such amount has already been funded by the Company.

As of March 31, 2024, the Company has funded $ 62.7 million of the 2023 and 2024 capital calls to the Peak Gold JV, of which $ 42.5 million was funded from the Facility (as defined below).

The Company believes it has sufficient capital to reach production at the Manh Choh mine, with its cash on hand and the $ 22.5 million of availability under the Facility.

The JV Management Committee approved a significant budget to complete the required development to start the operations of the Manh Choh mine, which began production early in the third quarter of 2024.

In 2024, it is anticipated that there will be $ 31.3 million of capital calls to the Peak Gold JV to reach production, $ 27.2 million of such amount has already been funded by the Company as of June 30, 2024 and the remaining $ 4.1 million was funded as of July 31, 2024.

As of June 30, 2024, the Company has funded $ 74.5 million of the 2023 and 2024 capital calls to the Peak Gold JV and $ 78.6 million as of July 31, 2024, of which $ 60.0 million was funded from the Facility (as defined below).

The Company believes it has sufficient capital to continue production at the Manh Choh mine, with its cash on hand and the $ 5.0 million of availability under the Facility.

The Manh Choh mine has commenced production in July 2024 and the Project remains on track to deliver its planned production this year.

The Company anticipates no further cash calls to the Peak Gold JV.

Although there can be no guarantee that the Peak Gold JV will make distributions to the Company, the Company believes that distributions are probable and that it will maintain sufficient liquidity to meet its working capital requirements, including repayment obligations of approximately $ 29.9 million on the Facility, for the next twelve months from the date of this report.

Failure to pay current debt obligations will result in an event of default and the Company's debt would be due immediately or callable (See Note 13).

The Company made a $ 2.0 million principal payment towards the Facility in July 2024.

If the Company elects to not fund a portion of its cash calls to the Peak Gold JV, its membership interest in the Peak Gold JV would be diluted.

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The Company initially recorded its investment at the historical book value of the asset s contributed to the Peak Gold JV, which was approximately $ 1.4 million.

As of M arch 31, 2024 the Company has contributed approximately $ 90.4 million to the Peak Gold JV.

As of March 31, 2024 the Company held a 30.0 % membership interest in the Peak Gold JV.

The following table is a roll-forward of the Company’s investment in the Peak Gold JV as of March 31, 2024:

As of J une 30, 2024 the Company has contributed approximately $ 102.2 million to the Peak Gold JV.

As of June 30, 2024 the Company held a 30.0 % membership interest in the Peak Gold JV.

The following table is a roll-forward of the Company’s investment in the Peak Gold JV as of June 30, 2024:

in Peak Gold, LLC

6 unchanged sentences

Investment balance at March 31, 2024

The following table presents the condensed unaudited results of operations for the Peak Gold JV for the three-month periods ended March 31, 2024 and 2023 in accordance with US GAAP:

Investment in Peak Gold, LLC

Loss from equity investment in Peak Gold, LLC

Investment balance at June 30, 2024

The following table presents the condensed unaudited results of operations for the Peak Gold JV for the three and six month periods ended June 30, 2024 and 2023 in accordance with US GAAP:

Three Months Ended

March 30, 2024

March 31, 2023

Exploration expense

General and administrative

Six Months Ended

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Total expenses

The Company’s share of the Peak Gold JV’s results of operations for the three months ended March 31, 2024 was a loss of approximately $ 0.1 million .

The Company’s share in the results of operations for the three months ended March 31, 2023 was a loss of approximately $ 0.2 million.

The Company’s share of the Peak Gold JV’s results of operations for the three and six months ended June 30, 2024 was a loss of approximately $ 0.7 million and 0.8 million respectively .

The Company’s share in the results of operations for the three and six months ended June 30, 2023 was a loss of approximately $ 6.7 million and $ 11.8 million respectively.

The Peak Gold JV loss does not include any provisions related to income taxes as the Peak Gold JV is treated as a partnership for income tax purposes.

As of March 31, 2024, the Company's cumulative investment in the Peak Gold JV exceeded its cumulative losses;

therefore the Company's investment in the Peak Gold JV as at March 31, 2024 was $ 43.4 million.

For March 31, 2023, the Company’s share of the Peak Gold JV’s inception-to-date results of operations was a cumulative loss of $ 43.4 million, which exceeded the Company's cumulative investment in the Peak Gold JV and the equity method of accounting was suspended, which resulted in suspended losses and an investment balance of $ 0 .

The portion of the cumulative loss that exceeded the Company's investment was suspended and recognized against earnings in the future periods.

As of June 30, 2024, the Company's cumulative investment in the Peak Gold JV exceeded its cumulative losses which allowed the Company to recognize its investment of $ 54.5 million.

As of June 30, 2023, the Company’s share of the Peak Gold JV’s cumulative losses was $ 44.8 million, which exceeded the Company's cumulative investment in the Peak Gold JV and caused the equity method of accounting to be suspended, which resulted in suspended losses and an investment balance of $ 0 .

In such a situation, the portion of cumulative loss that exceeds the investment is suspended and recognized against earnings in the future periods.

Prepaid Expenses and other assets

The Company has prepaid expenses and other assets of $ 1,189,852 and $ 1,112,910 as of March 31, 2024 and December 31, 2023, respectively.

Prepaid expenses primarily relate to prepaid insurance, surety bond deposits, and claim rentals.

The Company has prepaid expenses and other assets of $ 1,278,663 and $ 1,112,910 as of June 30, 2024 and December 31, 2023, respectively.

Prepaid expenses primarily relate to prepaid insurance, surety bond deposits, legal fees related to acquisition work, and claim rentals.

Net Loss Per Share

A reconciliation of the components of basic and diluted net loss per share of common stock is presented below:

Three Months Ended March 31,

Three Months Ended June 30,

Basic Net Loss per Share:

2 unchanged sentences

Net loss attributable to common stock

Options and warrants to purchase 501,000 shares of common stock of the Company were outstanding as of March 31, 2024, and 2023.

These options and warrants were not included in the computation of diluted earnings per share for the three-month periods ended March 31, 2024 and 2023 due to being anti-dilutive.

Six Months Ended June 30,

Basic Net Loss per Share:

Net loss attributable to common stock

Diluted Net Loss per Share:

Net loss attributable to common stock

Options and warrants to purchase 866,875 shares of common stock of the Company were outstanding as of June 30, 2024, and 501,000 shares as of June 30, 2023.

These options and warrants were not included in the computation of diluted earnings per share for the three and six month periods ended June 30, 2024 and 2023 due to being anti-dilutive.

Stockholders ’ Equity (Deficit)

The Company has 45,000,000 shares of common stock authorized, and 15,000,000 authorized shares of preferred stock.

As of March 31, 2024, 9,613,604 shares of common stock were outstanding, including 429,153 shares of unvested restricted stock.

As of March 31, 2024, options and warrants to purchase 501,000 shares of common stock of the Company were outstanding.

As of June 30, 2024, 10,363,434 shares of common stock were outstanding, including 429,153 shares of unvested restricted stock.

As of June 30, 2024, options and warrants to purchase 866,875 shares of common stock of the Company were outstanding.

No shares of preferred stock have been issued.

6 unchanged sentences

The Company pays the Agent a commission of 2.75 % of the gross proceeds of the Shares sold through it under the Sales Agreement.

The Company sold 11,022 shares for the three-month period ended March 31, 2024 and 211,376 between June 2023 to December 2023 of common stock pursuant to the Sales Agreement for net proceeds of approximately $0.2 million and $5.2 million, respectively.

$ 34.6 million of the Company's common stock remains available for sale under the ATM Program as of March 31, 2024.

Underwritten Offering

On July 24, 2023, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Maxim Group LLC and Freedom Capital Markets (collectively, the “Underwriters”), relating to an underwritten public offering (the “Offering”) of 1,600,000 shares (the “Underwritten Shares”) of the Company’s common stock.

All of the Underwritten Shares were sold by the Company.

The offering price of the Underwritten Shares was $ 19.00 per share, and the Underwriters agreed to purchase the Underwritten Shares from the Company pursuant to the Underwriting Agreement at a price of $ 17.77 per share (the “Purchase Price”), which included a 6.5 % Underwriters discount.

The net proceeds from the Offering were $28.2 million after deducting underwriting discounts and commissions and offering expenses.

The Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3.

The Offering closed on July 26, 2023.

The Company sold 24,115 shares during the six-month period ended June 30, 2024 and 211,376 between June 2023 to December 2023 of common stock pursuant to the Sales Agreement for net proceeds of approximately $ 0.5 million and $ 5.2 million, respectively.

$ 34.3 million of the Company's common stock remains available for sale under the ATM Program as of June 30, 2024.

Underwritten Offerings

On June 10, 2024, the Company entered into an underwriting agreement with Canaccord Genuity LLC and Cormark Securities Inc.

(collectively, the "June 2024 Underwriters"), relating to the underwritten public offering (the “ June 2024 Offering”) of 731,750 units (the "Units") of the Company at a price of $ 20.50 per Unit.

Each Unit consists of (i) one share of the Company's common stock and (ii) one-half of one accompanying warrant.

Each whole accompanying warrant is exercisable to purchase one share of the Company's common stock at a price of $ 26.00 per warrant, exercisable for a period of 36 months.

The June 2024 Underwriters agreed to purchase the Units from the Company pursuant to the June 2024 Underwriting Agreement at a price of $ 19.37 per Unit, which included a 5.5 % underwriting discount.

The fair value of each warrant was estimated as of the date of grant using the Black-Scholes option-pricing model (Level 2 of the fair value hierarchy) with the following weighted average assumptions used:

(i) risk-free interest rate of 4.57 %;

(ii) expected life of 3.0 years;

(iii) expected volatility of 57.0 %;

and (iv) expected dividend yield of 0 %.

The net proceeds from the June 2024 Offering were $ 13.7 million after deducting underwriting discounts and commissions and offering expenses.

The June 2024

Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3.

The June 2024 Offering closed on June 12, 2024 .

On July 24, 2023, the Company entered into an underwriting agreement (the “July 2023 Underwriting Agreement”) with Maxim Group LLC and Freedom Capital Markets (collectively, the “July 2023 Underwriters”), relating to an underwritten public offering (the “July 2023 Offering”) of 1,600,000 shares (the “Underwritten Shares”) of the Company’s common stock at a price of $ 19.00 per share.

The July 2023 Underwriters agreed to purchase the Underwritten Shares from the Company pursuant to the July 2023 Underwriting Agreement at a price of $ 17.77 per share, which included a 6.5 % underwriting discount.

The net proceeds from the July 2023 Offering were $ 28.2 million after deducting underwriting discounts and commissions and offering expenses.

The July 2023 Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3.

The July 2023 Offering closed on July 26, 2023.

May 2023 Warrant Exercise

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The January 2023 Securities sold were not registered under the Securities Act, but the January 2023 Shares and the January 2023 Warrant Shares are subject to a Registration Rights Agreement allowing the shares to be registered by the holders at a future date.

December 2022 Private Placement

On December 23, 2022, the Company completed the issuance and sale of an aggregate of 283,500 shares (the “December 2022 Shares”) of the Company’s common stock, for $ 20.00 per share, and warrants (the “December 2022 Warrants”) entitling each purchaser to purchase shares of common stock for $ 25.00 per share (the “December 2022 Warrant Shares” and together with the December 2022 Shares and the December 2022 Warrants, the “December 2022 Securities”), in a private placement (the “December 2022 Private Placement”) to certain accredited investors (the “December 2022 Investors”) pursuant to Subscription Agreements (the “December 2022 Subscription Agreements”), dated as of December 23, 2022 between the Company and each of the December 2022 Investors.

Pursuant to the December 2022 Warrants between the Company and each of the December 2022 Investors, the December 2022 Warrants are exercisable, in full or in part, at any time until the second anniversary of their issuance, at an exercise price of $ 25.00 per share of common stock.

Net proceeds from the December 2022 Private Placement totaled approximately $ 5.6 million and were used to fund the Company’s exploration and development program and for general corporate purposes.

The December 2022 Securities sold were not registered under the Securities Act, but the December 2022 Shares and the December 2022 Warrant Shares are subject to a Registration Rights Agreement allowing the shares to be registered by the holders at a future date.

Rights Agreement

4 unchanged sentences

Each Right will entitle the holder to buy one one-thousandth ( 1/1000 ) of a share of a series of junior preferred stock at an exercise price of $ 100.00 per Right, subject to anti-dilution adjustments.

The Rights Agreement had an initial term of one year, expiring on September 22, 2021, which the Company's board of directors approved several amendments to the Rights Agreement, extending the term of the Rights Agreement to September 23, 2024.

The Rights Agreement had an initial term of one year, expiring on September 22, 2021.The Company's board of directors has approved several amendments to the Rights Agreement, extending the term of the Rights Agreement to September 23, 2024.

Property & Equipment

The table below sets forth the book value by type of fixed asset as well as the estimated useful life:

March 31, 2024

June 30, 2024

December 31, 2023

10 unchanged sentences

Property & Equipment, net

Related Party Transactions

Brad Juneau, who served as the Company’s Chairman, President and Chief Executive Officer until January 6, 2020, and the Company’s Executive Chairman until November 11, 2021, and now serves as the Company's Chairman is also the sole manager of Juneau Exploration, L.P.

(“JEX”), a private company involved in the exploration and production of oil and natural gas.

On December 11, 2020, the Company entered into a Second Amended and Restated Management Services Agreement (the “A&R MSA”) with JEX, which amends and restates the Amended and Restated Management Services Agreement between the Company and JEX dated as of November 20, 2019.

Pursuant to the A&R MSA, JEX provides certain facilities, equipment and services used in the conduct of the business and affairs of the Company and management of its membership interest in the Peak Gold JV.

Pursuant to the A&R MSA, JEX provides the Company office space and office equipment, and certain related services.

The A&R MSA was effective for one year beginning December 1, 2020 and renewed automatically on a monthly basis unless terminated upon ninety days’ prior notice by either the Company or JEX.

Pursuant to the A&R MSA, the Company paid JEX a monthly fee of $ 10,000 , which included an allocation of approximately $ 6,900 for office space and equipment.

JEX was also reimbursed for its reasonable and necessary costs and expenses of third parties incurred for the Company.

The A&R MSA included customary indemnification provisions.

In January 2023, the monthly fee paid to JEX was reduced to $ 3,000 , and only covers office equipment and related services.

In January 2024, the A&R MSA was $ 3,000 and the agreement was terminated on March 31, 2024.

On January 1, 2024, Rick Van Nieuwenhuyse, the Company's President and Chief Officer, realized a vesting of 55,000 restricted shares of common stock, which resulted in federal and state income tax obligations.

Consistent with the Company’s treatment of employees who experience similar tax obligations in connection with their vesting of restricted shares, the Company sold a total of 22,025 shares of common stock and proceeds will be used by the Company to pay the tax obligations on the vested shares.

The Company had a receivable with Rick Van Nieuwenhuyse, in the amount of $ 217,000 related to taxes from the vesting of restricted shares as at March 31, 2024.

The receivable is included in prepaid expenses and other on the condensed consolidated balance sheets and was settled in April 2024 upon completion of the share settlements.

Stock-Based Compensation

6 unchanged sentences

On November 14, 2023, the stockholders of the Company approved and adopted the 2023 Omnibus Incentive Plan (the “2023 Plan”) (together with the Amended Equity Plan referred to as the “Equity Plans”), which replaces the 2010 Plan with respect to new grants by the Company.

Shares available for grant under the 2023 Plan consist of 193,500 shares of common stock plus (i) any shares remaining available for grant under the 2010 Plan ( 473,026 shares as of March 31, 2024), (ii) unexercised shares subject to appreciation awards (i.e.

Shares available for grant under the 2023 Plan consist of 193,500 shares of common stock plus (i) any shares remaining available for grant under the 2010 Plan ( 473,026 shares as of June 30, 2024), (ii) unexercised shares subject to appreciation awards (i.e.

stock options or other stock-based awards based on the appreciation in value of a share of the Company’s common stock) granted under the 2010 Plan that expire, terminate, or are canceled for any reason without having been exercised in full, and (iii) shares subject to awards that are not appreciation awards granted under the 2010 Plan that are forfeited for any reason.

As of March 31, 2024, there were 429,153 shares of unvested restricted common stock outstanding and 100,000 options to purchase shares of common stock outstanding issued under the Equity Plans.

Stock-based compensation expense for the three-month period ended March 31, 2024 was $ 0.7 million.

Stock-based compensation expense for the three-month period ended March 31, 2023

was $ 0.6 million.

As of June 30, 2024, there were 429,153 shares of unvested restricted common stock outstanding and 100,000 options to purchase shares of common stock outstanding issued under the Equity Plans.

Stock-based compensation expense for the three and six months ended June 30, 2024 were $ 0.6 million and $ 1.3 million respectively.

Stock-based compensation expense for the three and six months ended June 30, 2023 were $ 0.7 million and $ 1.3 million respectively.

The amount of compensation expense recognized does not reflect cash compensation actually received by the individuals during the current period, but rather represents the amount of expense recognized by the Company in accordance with US GAAP.

15 unchanged sentences

The expected term of the options granted represents the period of time that the options are expected to be outstanding.

The simplified method is used to estimate the expected term, due to the lack of historical stock option exercise activity.

The simplified method is used to estimate the expected term, due to the lack of historical stock option

exercise activity.

The risk-free interest rate is based on U.S.

Treasury bills with a duration equal to or close to the expected term of the options at the time of grant.

There were no newly vested stock options in the three-month period ended March 31, 2024 or for the six-month period ended December 31, 2023.

As of March 31, 2024, the total unrecognized compensation cost related to nonvested stock options was $ 0 .

As of March 31, 2024, the stock options had a weighted average remaining life of 0.78 years.

There were no newly vested stock options in the six months ended June 30, 2024 or for the six-month period ended December 31, 2023.

As of June 30, 2024, the total unrecognized compensation cost related to nonvested stock options was $ 0 .

As of June 30, 2024, the stock options had a weighted average remaining life of 0.56 years.

Restricted Stock.

3 unchanged sentences

The grant date fair value may differ from the fair value on the date the individual’s restricted stock actually vests.

The total grant date fair value of the restricted stock granted in the three month period ended March 31, 2024 and March 31, 2023 was $ 2.3 million and $ 2.2 million, respectively.

As of March 31, 2024, there were 429,153 shares of such restricted stock that remained unvested and the total compensation cost related to nonvested restricted share awards not yet recognized was $ 3,395,144 .

The total grant date fair value of the restricted stock granted in the six months ended June 30, 2024 and June 30, 2023 was $ 2.3 million and $ 2.2 million, respectively.

As of June 30, 2024, there were 429,153 shares of such restricted stock that remained unvested and the total compensation cost related to nonvested restricted share awards not yet recognized was $ 2,753,591 .

The remaining costs are expected to be recognized over the remaining vesting period of the awards.

Below table indicates the unvested restricted stock balance as of March 31, 2024 and December 31, 2023:

Below table indicates the unvested restricted stock balance as of June 30, 2024 and December 31, 2023:

Number of restricted shares unvested

2 unchanged sentences

Restricted shares vested

Balance - March 31, 2024

Balance - June 30, 2024

Balance - July 01, 2023

2 unchanged sentences

Balance - December 31, 2023

A summary of the status of stock options granted under the Equity Plans as of March 31, 2024 and changes during the three months then ended, is presented in the table below:

Three Months Ended

March 31, 2024

A summary of the status of stock options granted under the Equity Plans as of June 30, 2024 and changes during the s ix months then ended, is presented in the table below:

Six Months Ended

June 30, 2024

Exercise Price

13 unchanged sentences

Additionally, should the Peak Gold JV derive revenues from the properties covered under the Tetlin Lease, the Peak Gold JV is required to pay the Tetlin Tribal Council a production royalty ranging from 3.0 % to 5.0 %, depending on the type of metal produced and the year of production.

In lieu of a $ 450,000 cash payment to the Peak Gold JV from the Tetlin Tribal Council to increase its production royalty by 0.75 %, the Peak Gold JV agreed to credit the $ 450,000 against future production royalty and advance minimum royalty payments due to the Tetlin Tribal Council under the lease once production begins.

In lieu of a $ 450,000 cash payment to the Peak Gold JV from the Tetlin Tribal Council to increase its production royalty

by 0.75 %, the Peak Gold JV agreed to credit the $ 450,000 against future production royalty and advance minimum royalty payments due to the Tetlin Tribal Council under the lease once production begins.

Until such time as production royalties begin, the Peak Gold JV must pay the Tetlin Tribal Council an advance minimum royalty of approximately $ 75,000 per year, and subsequent years are escalated by an inflation adjustment.

5 unchanged sentences

The associated rental expense is amortized over the rental claim period, September 1 through August 31 of each year.

As of March 31, 2024, the Peak Gold JV had met the annual labor requirements for the State of Alaska acreage for the next four years, which is the maximum period allowable by Alaska law.

As of June 30, 2024, the Peak Gold JV had met the annual labor requirements for the State of Alaska acreage for the next four years, which is the maximum period allowable by Alaska law.

Lucky Shot Property .

8 unchanged sentences

Retention Agreements.

In February 2019, the Company entered into retention agreements with its then Chief Executive Officer, Brad Juneau, its then Chief Financial Officer, Leah Gaines, and one other former employee providing for payments in an aggregate amount of $ 1,250,000 upon the occurrence of certain conditions (collectively, the "Retention Agreements").

The Retention Agreements are triggered upon a change of control (as defined in the applicable Retention Agreement), provided that the recipient is employed by the Company when the change of control occurs.

On February 6, 2020, the Company entered into amendments to the Retention

Agreements to extend the term of the change of control period from August 6, 2020 until August 6, 2025.

Juneau and Ms.

Gaines will receive a payment of $ 1,000,000 and $ 250,000 , respectively, upon a change of control that takes place prior to August 6, 2025.

In February 2019, the Company entered into retention agreements with its then Chief Executive Officer, Brad Juneau, for payments in the amount of $ 1,000,000 upon the occurrence of certain conditions (collectively, the "Retention Agreement").

The Retention Agreement is triggered upon a change of control (as defined in the applicable Retention Agreement), provided that the recipient is employed by the Company when the change of control occurs.

On February 6, 2020, the Company entered into amendments to the Retention Agreement to extend the term of the change of control period from August 6, 2020 until August 6, 2025.

Juneau will receive a payment of $ 1,000,000 , upon a change of control that takes place prior to August 6, 2025.

On June 10, 2020, the Company entered into a retention payment agreement with Rick Van Nieuwenhuyse, the Company’s President and Chief Executive Officer, providing for a payment in an amount of $ 350,000 upon the occurrence of certain conditions (the "Retention Payment Agreement").

1 unchanged sentence

Van Nieuwenhuyse is employed by the Company when the change of control occurs.

On August 4, 2023, the Company entered into new retention agreements (the “2023 Retention Agreements”) with Ms.

Gaines and one other former employee, which replaced the previous retention agreements, for payments in an aggregate amount of $ 540,000 .

The expenses related to the 2023 Retention Agreements were accrued for the six-month period ended December 31, 2023 and were subsequently paid out in accordance with their terms in January 2024.

Employment Agreement .

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In addition, in the event of a Change of Control (as defined in the Equity Plans) during the term of the STIP, the Compensation Committee, in its sole and absolute discretion, may make a payment to its officers in an amount up to 200.0 % of their then annual base salary, payable in cash, shares of common stock of the Company under the 2023 Plan or a combination of both, as determined by the Compensation Committee, not later than 30 days following such Change of Control.

The Company recognized a full valuation allowance on its deferred tax asset as of March 31, 2024 and December 31, 2023 and has recognized zero income tax expense for the three months ended March 31, 2024 and March 31, 2023.

The effective tax rate was 0 % for the three months ended March 31, 2024 and 202 3.

Committee for Safe Communities Complaint On October 20, 2023, the Committee for Safe Communities (“CSC”), an Alaskan non-profit corporation inclusive of certain vacation homeowners along the Manh Choh ore haul route and others, filed suit in the Superior Court for the State of Alaska in Fairbanks, Alaska (the “Superior Court”) against the State of Alaska, Department of Transportation and Public Facilities (the “DOT”), seeking injunctive relief with respect to CSC’s oversight of the Peak Gold JV’s ore haul plan.

Ore from the Manh Choh mine is being trucked to the Fort Knox mill for processing via public roadways in state-of-the-art trucks carrying legal loads.

The complaint alleges that the DOT has approved a haul route and trucking plan for the Manh Choh project that violates DOT regulations, DOT’s actions have created an unreasonable risk to public safety constituting an attractive public nuisance, and DOT has aided and abetted the offense of negligent driving.

On November 2, 2023, CSC filed a motion for preliminary injunction.

On November 9, 2023, the Peak Gold JV filed a motion to intervene in this lawsuit, which was granted on November 15, 2023.

On January 15, 2024, Peak Gold and DOT jointly moved for judgment on the pleadings and to stay all discovery.

On May 14, 2024, the Court issued an Order denying the plaintiff’s motion for preliminary injunction and staying discovery.

On June 24, 2024, the Court issued an Order granting judgment on the pleadings as to three of the four claims for relief alleged in the Complaint and denying relief as to the claim for public nuisance.

The Order further lifted the stay of discovery.

On July 3, 2024, the DOT filed motion for reconsideration as to the Court’s Order on the motion for judgment on the pleadings, which Peak Gold joined.

At a scheduling conference on July 16, 2024, the Court ordered plaintiff to respond to the motion for reconsideration and set a trial for August 11, 2025.

The Company recognized a full valuation allowance on its deferred tax asset as of June 30, 2024 and December 31, 2023 and has recognized zero income tax expense for the three and six months ended June 30, 2024 and June 30, 2023.

The effective tax rate was 0 % for the three and six months ended June 30, 2024 and 202 3.

The Company has historically had a full valuation allowance, which resulted in no net deferred tax asset or liability appearing on its statement of financial position.

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The Company reviews its tax positions quarterly for tax uncertainties.

The Company did no t have any uncertain tax positions as of March 31, 2024 or December 31, 2023.

The table below shows the components of Debt, net as of March 31, 2024 and December 31, 2023 :

The Company did no t have any uncertain tax positions as of June 30, 2024 or December 31, 2023.

The table below shows the components of Debt, net as of June 30, 2024 and December 31, 2023 :

Secured Debt Facility

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The Facility has an upfront fee and a production linked arrangement fee based upon the projected total production of gold ounces in the base case financial model delivered on the closing date, payable quarterly based on attributable production, with any balance due upon the maturity or termination of the Credit Agreement.

The Credit Agreement is secured by all the assets and properties of the Company and its subsidiaries, including the Company’s 30 % interest in Peak Gold, LLC, but excluding the Company’s equity interests of LSA in respect of the Lucky Shot mine.

The Credit Agreement is secured by all the assets and properties of the Company and its subsidiaries, including the Company’s 30 % interest in Peak Gold, LLC, but excluding the Company’s

equity interests of LSA in respect of the Lucky Shot mine.

As a condition precedent to the second borrowing, the Company was required to hedge approximately 125,000 ounces of its attributable gold production from Manh Choh.

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The hedge agreements have delivery obligations beginning in July 2024 and ending in December 2026 .

The Company has commenced delivery into those hedge agreements in July 2024.

See Note 14 - Derivatives and Hedging Activities in the Company's Form 10-KT for the six-month period ended December 31, 2023.

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Any outstanding liquidity loans must be repaid on July 31, 2025.

As of June 30, 2024, the Company did no t have any liquidity loans outstanding.

Loans under the Facility can be Base Rate loans at the Base Rate plus the Applicable Margin or Secured Overnight Financing Rate (“SOFR”) loans at the three month adjusted term SOFR plus the Applicable Margin.

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The commitment fee is payable in arrears on each interest payment date with the final on the commitment termination date, which is 18 months after the closing date of May 17, 2023.

As of March 31, 2024, the Company had unused borrowing commitments of $ 22.5 million.

As of June 30, 2024, the Company had unused borrowing commitments of $ 5.0 million.

Borrowings under the Facility carried an original issue discount of $ 2.3 million and debt issuance costs of approximately $ 1.6 million.

As of March 31, 2024, the unamortized discount and issuance costs were $ 2.3 million and $ 2.7 million, respectively, and the carrying amount, net of the unamortized discount and issuance costs was $ 37.6 million.

As of June 30, 2024, the unamortized discount and issuance costs were $ 2.1 million and $ 2.8 million, respectively, and the carrying amount, net of the unamortized discount and issuance costs was $ 55.1 million.

As of December 31, 2023, the unamortized discount and issuance costs were $ 2.4 million and $ 2.4 million, respectively and the carrying amount, net of the unamortized discount and issuance costs was $ 25.2 million.

The fair value of the debt (Level 2) as of March 31, 2024 and December 31, 2023 was $ 42.5 million and $ 30.0 million, respectively.

The Company recognized interest expense totaling $ 1.6 million related to this debt for the three months ended March 31, 2024 (inclusive of approximately $ 1.1 million of contractual interest, and approximately $ 0.5 million related to the amortization of the discount and issuance fees).

There was no interest expense related to the Facility for the three months ended March 31, 2023 as the Facility was not yet in place.

The effective interest rate of the term loan facility was 11.47 % as of March 31, 2024 and 11.58 % as of December 31, 2023.

As of March 31, 2024 and December 31, 2023, the effective interest rate for the amortization of the discount and issuance costs was 6.2 % and 5.6 %, respectively.

The fair value of the debt (Level 2) as of June 30, 2024 and December 31, 2023 was $ 60.0 million and $ 30.0 million, respectively.

The Company recognized interest expense totaling $ 4.0 million related to this debt for the six months ended June 30, 2024 (inclusive of approximately $ 2.6 million of contractual interest, and approximately $ 1.4 million related to the amortization of the discount and issuance fees).

The Company recognized interest expense totaling $ 0.2 million related to this debt for the six months ended June 30, 2023 (inclusive of approximately $ 145,000 of contractual interest, and approximately $ 17,000 related to the amortization of the discount and issuance fees).

The effective interest rate of the term loan facility was 11.50 % as of June 30, 2024 and 11.58 % as of December 31, 2023.

As of June 30, 2024 and December 31, 2023, the effective interest rate for the amortization of the discount and issuance costs was 7.3 % and 5.6 %, respectively.

The Credit Agreement contains representations and warranties and affirmative and negative covenants customary for credit facilities of this type, including limitations on the Company and its subsidiaries with respect to indebtedness, liens, mergers, consolidations, liquidations and dissolutions, sales of all or substantially all assets, transactions with affiliates and entry into hedging arrangements.

The Credit Agreement also requires the Company to maintain, as of the last day of each fiscal quarter, (i) a historical debt service coverage ratio of no less than 1.30 to 1.00, (ii) a projected debt service coverage ratio until the Maturity Date of no less than 1.30 to 1.00;

The Credit Agreement, as amended also requires the Company to maintain, as of the last day of each fiscal quarter, (i) a historical debt service coverage ratio of no less than 1.30 to 1.00, (ii) a projected debt service coverage ratio until the Maturity Date of no less than 1.30 to 1.00;

(iii) a loan life coverage ratio until the Maturity Date of no less than 1.40 to 1.00;

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The Company is also required to maintain a minimum cash balance of $ 2 million.

As of March 31, 2024, the Company was in compliance with, or has received waiver or consent from ING and Macquarie, all of the required debt covenants.

As of March 31, 2024, the Company had drawn a total of $ 42.5 million on the Facility.

The Company is scheduled to repay $ 7.9 million in 2024, $ 29.0 million by July 31, 2025 and the remaining $ 5.6 million to be paid quarterly thru December 31, 2026.

As of June 30, 2024, the Company was in compliance with, or has received waiver or consent from ING and Macquarie, all of the required debt covenants.

The waivers and consents primarily related to the Company's entry into transactions that required conditions to be modified under the Credit Agreement.

As of June 30, 2024, the Company had drawn a total of $ 60.0 million on the Facility.

The Company made a $ 2.0 million principal repayment in July 2024 and is scheduled to repay $ 5.9 million for remainder of 2024, $ 42.6 million in 2025 and the remaining $ 9.5 million to be paid quarterly thru December 31, 2026.

Future draws on the term loan facility are subject to certain additional conditions being met.

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The Debenture carried an original issue discount of $ 0.6 million and debt issuance costs of approximately $ 0.2 million.

As of March 31, 2024 and December 31, 2023, the unamortized discount and issuance costs were $ 0.5 million and $ 0.5 million, respectively.

The carrying amount of the debt at March 31, 2024 and December 31, 2023, net of the unamortized discount and issuance costs was $ 19.5 million and $ 19.5 million respectively.

The fair value of the Debenture (Level 2) as of March 31, 2024 and December 31, 2023 was $ 20.0 million.

The Company recognized interest expense totaling $ 0.5 million related to this debt for the three months ended March 31, 2024 (inclusive of approximately $ 450,000 of contractual interest, and approximately $ 29,000 related to the amortization of the discount and issuance fees).

The Company recognized interest expense totaling $ 0.4 million related to this debt for the quarter ended March 31, 2023 (inclusive of approximately $ 400,000 of contractual interest, and approximately $ 47,000 related to the amortization of the discount and issuance fees).The effective interest rate of the Debenture is the same as the stated interest rate, 9.0 %.

The effective interest rate for the amortization of the discount and issuance costs as of March 31, 2024 and December 31, 2023 was 0.6 % and 0.6 %, respectively.

As of June 30, 2024 and December 31, 2023, the unamortized discount and issuance costs were $ 0.5 million and $ 0.5 million, respectively.

The carrying amount of the debt at June 30, 2024 and December 31, 2023, net of the unamortized discount and issuance costs was $ 19.5 million and $ 19.5 million respectively.

The fair value of the Debenture (Level 2) as of June 30, 2024 and December 31, 2023 was $ 20.0 million.

The Company recognized interest expense totaling $ 1.0 million related to this debt for the six months ended June 30, 2024 (inclusive of approximately $ 900,000 of contractual interest, and approximately $ 58,000 related to the amortization of the discount and issuance fees).

The Company recognized interest expense totaling $ 0.9 million related to this debt for the six months ended June 30, 2023 (inclusive of approximately $8 00,000 of contractual interest, and approximately $ 100,000 related to the amortization of the discount and issuance fees).The effective interest rate of the Debenture is the same as the stated interest rate, 9.0 %.

The effective interest rate for the amortization of the discount and issuance costs as of June 30, 2024 and December 31, 2023 were 0.6 % and 0.6 %, respectively.

The Company reviewed the provisions of the debt agreement to determine if the agreement included any embedded features.

The Company concluded that the change of control provisions within the debt agreement met the characteristics of a derivative and required bifurcation and separate accounting.

The fair value of the identified derivative was determined to be de minimis at March 31, 2024 and December 31, 2023 as the probability of a change of control was negligible as of those dates.

The fair value of the identified derivative was determined to be de minimis at June 30, 2024 and December 31, 2023 as the probability of a change of control was negligible as of those dates.

For each subsequent reporting period, the Company will evaluate each potential derivative feature to conclude whether or not they qualify for derivative accounting.

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Derivatives and Hedging Activities

On August 2, 2023, CORE Alaska, a subsidiary of the Company, pursuant to an ISDA Master Agreement entered into with ING Capital Markets LLC (the “ING ISDA Master Agreement”) and an ISDA Master Agreement entered into with Macquarie Bank Limited (the “Macquarie ISDA Master Agreement”), in accordance with its obligations under the Credit Agreement, entered into a series of hedging agreements with ING Capital LLC and Macquarie Bank Limited for the sale of an aggregate of 124,600 ounces of gold at a weighted average price of $ 2,025 per ounce.

hedging agreements with ING Capital LLC and Macquarie Bank Limited for the sale of an aggregate of 124,600 ounces of gold at a weighted average price of $ 2,025 per ounce.

The hedge agreements have delivery obligations beginning in July 2024 and ending in December 2026, and represent approximately 42 % of the Company’s interest in the projected production from the Manh Choh mine over the current anticipated life of the mine.

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Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings.

As of March 31, 2024, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships:

As of June 30, 2024, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships:

Average Price

Fair Values of Derivative Instruments on the Balance Sheet

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023.

As of March 31, 2024

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023.

As of June 30, 2024

As of December 31, 2023

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Derivative contract liability - noncurrent

As of March 31, 2024, the fair value of derivatives in a net liability position, which excludes any adjustment for nonperformance risk, related to these agreements was $ 39,043,111 .

As of March 31, 2024, the Company has not posted any collateral related to these agreements.

If the Company had breached any of these provisions as of March 31, 2024, it could have been required to settle its obligations under the agreements at their termination value of $ 39,043,111 .

As of June 30, 2024, the fair value of derivatives in a net liability position, which excludes any adjustment for nonperformance risk, related to these agreements was $ 51,596,602 .

As of June 30, 2024, the Company has not posted any collateral related to these agreements.

If the Company had breached any of these provisions as of June 30, 2024, it could have been required to settle its obligations under the agreements at their termination value of $ 51,596,602 .

Effect of Derivatives Not Designated as Hedging Instruments on the Income Statement

The table below presents the effect of the Company’s derivative financial instruments that are not designated as hedging instruments on the Condensed Consolidated Statement of Operations for the three months ended March 31, 2024 and 2023.

Derivatives Not Designated as Hedging Instruments under Subtopic 815-20

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Recognized in Income on Derivative

March 31, 2024

March 31, 2023

Amount of Gain or (Loss)

Recognized in Income on Derivative

Three months ended

June 30, 2024

Three months ended

June 30, 2023

Six months ended

June 30, 2024

Six months ended

June 30, 2023

Commodity Contracts

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The Company reflects transfers between the three levels at the beginning of the reporting period in which the availability of observable inputs no longer justifies classification in the original level.

There were no transfers between fair value hierarchy levels for the quarter ended March 31, 2024.

There were no transfers between fair value hierarchy levels for the quarter ended June 30, 2024.

Fair Value on a Recurring Basis

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The following table summarizes the fair value of the Company’s financial assets and liabilities, by level within the fair-value hierarchy (in thousands):

As of March 31, 2024

As of June 30, 2024

Financial Assets

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General and Administrative Expenses

The following table presents the Company's general and administrative expenses for the three-month period ended March 31, 2024 and 2023.

The following table presents the Company's general and administrative expenses for the three and six months ended June 30, 2024 and 2023.

General and administrative expenses:

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HighGold Acquisition

On May 1, 2024 , the Company entered into a definitive arrangement agreement (the “Arrangement Agreement”), by and among the Company, Contango Mining Canada Inc., a corporation organized under the laws of British Columbia and a wholly owned subsidiary of the Company, and HighGold Mining Inc., a corporation existing under the laws of the Province of British Columbia (“HighGold”), pursuant to which the Company intends to acquire 100 % of the outstanding equity interests of HighGold (the “HighGold Acquisition”).

Under the terms of the Arrangement Agreement, each HighGold share of common stock will be exchanged for 0.019 shares of Contango common stock (the “Exchange Ratio”) based on the VWAP of Contango shares on the NYSE American for the five-day period ending on May 1, 2024.

The Exchange Ratio implies total consideration of approximately $ 0.40 per HighGold share and total HighGold equity value of approximately $ 37 million.

Upon completion of the HighGold Acquisition, existing Contango shareholders will own approximately 85 % and HighGold shareholders will own approximately 15 % of the combined company.

In connection with the HighGold Acquisition, Contango will grant to HighGold the right to appoint one director to Contango’s board of directors.

Closing of the HighGold Acquisition is subject to customary closing conditions and is expected to occur in July 2024.

The Arrangement Agreement

contains customary representations, warranties and covenants and also includes indemnification provisions under which the parties have agreed to indemnify each other against certain liabilities.

of the Company, and HighGold Mining Inc., a corporation existing under the laws of the Province of British Columbia (“HighGold”), pursuant to which the Company acquired 100 % of the outstanding equity interests of HighGold (the “HighGold Acquisition”) by way of a court approved plan of arrangement under the Business Corporations Act (British Columbia).

The HighGold Acquisition, which was approved by HighGold shareholders at HighGold’s special meeting held on June 27, 2024, was subsequently approved by the Supreme Court of British Columbia on July 2, 2024.

On July 10, 2024, the Company completed the HighGold Acquisition and, as contemplated by the Arrangement Agreement, each HighGold share of common stock was exchanged for 0.019 shares of Contango common stock, par value $ 0.01 per share (the “common stock”).

HighGold options were also exchanged, directly or indirectly, for Contango shares of common stock, based on the fair market value of the HighGold options prior to the closing date.

Upon closing of the HighGold Acquisition, the Company issued an aggregate of 1,698,887 shares of Contango common stock, with a value of approximately $ 33.4 million, to HighGold shareholders in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 3(a)(10) of the Securities Act.

Such exemption was based on the final order of the Supreme Court of British Columbia issued on July 2, 2024, approving the Acquisition following a hearing by the court which considered, among other things, the fairness of the Acquisition to the persons affected.

Upon completion of the Acquisition, existing Contango shareholders own approximately 85.9 % and HighGold shareholders own approximately 14.1 % of the combined company.

Avidian Alaska Acquisition

On May 1, 2024 , the Company entered into a stock purchase agreement (the “SPA”) with Avidian Gold Corp.

(“Avidian”) pursuant to which Contango has agreed to purchase Avidian’s 100 % owned Alaskan subsidiary, Avidian Gold Alaska Inc.

(“Avidian Alaska”) for initial consideration of $ 2,400,000 , with a contingent payment for up to $ 1,000,000 (the "Avidian Acquisition").

Contango will pay Avidian an initial purchase price of $ 2,400,000 consisting of (i) $ 400,000 in cash (the “Cash Consideration”) and (ii) $ 2,000,000 in shares of Contango common stock (the “Equity Consideration”).

On May 1, 2024 , the Company entered into a stock purchase agreement with Avidian Gold Corp.

(“Avidian”) pursuant to which the Company has agreed to purchase Avidian’s 100 % owned Alaskan subsidiary, Avidian Gold Alaska Inc., for initial consideration of $ 2,400,000 , with a contingent payment for up to $ 1,000,000 (the “Avidian Alaska Acquisition”).

On August 6, 2024 , the Company completed the Avidian Alaska Acquisition.

As contemplated by the stock purchase agreement entered into with Avidian, the initial purchase price of $ 2,400,000 consisted of (i) $ 400,000 in cash (the “Cash Consideration”) and (ii) $ 2,000,000 in shares of Contango common stock, with $ 250,000 of such shares withheld at closing and to be paid only upon settlement of a withholding contingency (the “Equity Consideration”).

The Cash Consideration shall be paid in the following tranches:

(i) a deposit $ 50,000 (paid) (ii) $ 150,000 due on the closing date, and (iii) $ 200,000 due on or before the 6-month anniversary of the closing date.

The number of shares of common stock constituting the Equity Consideration will be determined based on Contango’s 10-day VWAP on the NYSE American immediately prior to the closing date.

If Contango makes a positive production decision on either of the Amanita or Golden Zone properties within 120 months of the closing date, Contango will pay Avidian an additional $ 1,000,000 within thirty (30) days of such decision (the “Deferred Purchase Price”).

The Deferred Purchase Price can be paid in either cash or shares of Contango at Contango’s sole discretion.

If at any time prior to this production decision, within the 120-month period, Contango enters into a third-party transaction on any of the properties, Avidian will receive 20 % of the consideration received by Contango (capped at $ 500,000 per property) credited against the total Deferred Purchase Price.

The Transaction is subject to Avidian Shareholder approval, as well as the receipt of all required governmental and/or regulatory approvals, including that of the Toronto Venture Exchange and NYSE American.

Should Avidian Shareholders not approve this transaction the Agreement will terminate and a termination fee of $ 175,000 will be paid to Contango, representing liquidated damages for the time, resources and opportunities lost in facilitating this transaction.

Closing of the Avidian Acquisition is subject to customary closing conditions and is expected to occur in July 2024.

(i) a deposit of $ 50,000 (paid), (ii) $ 150,000 to be paid upon settlement of a withholding contingency and (iii) $ 200,000 of the Cash Consideration to be paid on or before the six-month anniversary of the closing date.

The number of shares of common stock constituting the Equity Consideration, which were issued or will be issued in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 4(a)(2) of the Securities Act, was determined based on Contango’s 10-day VWAP on the NYSE American immediately prior to the closing date.

Committee for Safe Communities Complaint

On July 3, 2024, the DOT filed motion for reconsideration as to the Court’s Order on the motion for judgment on the pleadings, which Peak Gold joined.

At a scheduling conference on July 16, 2024, the Court ordered plaintiff to respond to the motion for reconsideration and set a trial for August 11, 2025.

Dot Lake Complaint

On July 1, 2024, the Village of Dot Lake, a federally recognized Indian Tribe, located approximately 50 miles from the Manh Choh mine on the ore haul route along the Alaska Highway (“Dot Lake”), filed a complaint in the U.S District Court for the District of Alaska against U.S.

Army Corps of Engineers (the “Corps”) and Lt.

General Scott A.

Spellmon, in his official capacity as Chief of Engineers and Commanding General of the Corps.

The complaint seeks declaratory and injunctive relief based on the Corps’ alleged failure to consult with Dot Lake and to undertake an adequate environmental review with respect to the Corps’ issuance in September 2022 of a wetlands disturbance permit in connection with the overall permitting of the Manh Choh mine as to approximately 5 acres of wetlands located on Tetlin Village land.

Peak Gold is not named as a defendant in the complaint and it is evaluating its options with respect to protecting its interests in continuing to operate the Manh Choh mine.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

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In addition to the risk factors described in Part II, Item 1A.

Risk Factors, of this report and Part I, Item 1A.

Risk Factors, of this Form 10-Q and Part I, Item 1A.

Risk Factors, in our Transition Report on Form 10-KT for the six-month period ended December 31, 2023, these factors include among others:

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• Operational constraints and delays;

• Risks associated with exploring in the mining industry;

• Exploration and operational risks associated with the mining industry;

• Timing and successful discovery of natural resources;

• Availability of capital and the ability to repay indebtedness when due;

• Declines and variations in the price of gold and associated minerals, as well as price volatility for natural resources;

• Availability of operating equipment;

• Operating hazards attendant to the mining industry;

• Ability to find and retain skilled personnel;

• Restrictions on mining activities;

• Legislation that may regulate mining activities;

• Impact of new and potential legislative and regulatory changes on mining operating and safety standards;

• Federal and state legislation and regulation that affects mining development and activities;

• Impact of new and potential legislative and mining operating and safety standards;

• Uncertainties of any estimates and projections relating to any future production, costs and expenses (including changes in the cost of fuel, power, materials, and supplies);

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• Stock price and interest rate volatility;

• Federal and state regulatory developments and approvals;

• Availability and cost of material and equipment;

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• Worldwide economic conditions;

• Impact of pandemics, such as the worldwide COVID-19 outbreak, which could impact the Company's or the Peak Gold JV’s exploration schedule and operating activities;

• Expanded rigorous monitoring and testing requirements;

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All forward-looking statements included herein are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

First Quarter 2024 Highlights

The Company’s Manh Choh Project has commenced ore mining and stockpiling at the Fort Knox facility.

The project is on track for first production in early Q3 2024.

Ore and waste mining are ongoing with the full mining fleet now in operation as planned.

Following several months of orientation runs, transportation of ore to Fort Knox, where the ore will be processed, continues to ramp up with all contracted trucks received, the majority of the drivers onboarded, and trailer manufacturing now complete.

At Fort Knox, mill modifications and site preparation remain on plan, including the completion of the ore delivery road and tie-ins for the pebble recycle conveyor.

Building construction is advancing well, along with interior piping and electrical works.

Second Quarter 2024 Highlights and Recent Developments

Manh Choh Project

The Company’s Manh Choh Project continued ore mining and stockpiling at the Fort Knox facility during the quarter.

On July 8, 2024, Manh Choh achieved a significant milestone and poured its first gold bar, on schedule.

Ore transportation has ramped up to planned volumes, full commissioning of the modifications at the Fort Knox mill is expected in the third quarter and the project remains on track to deliver its planned production this year.

Johnson Tract Project

On July 30, 2024 the Company announced the start of a surface drilling campaign at the Johnson Tract property.

The 2024 surface exploration drilling targets 3,000 meters (~9,850 ft) across 20 drill holes and is designed to in-fill the upper one-third of the near vertical resource.

In parallel with the in-fill drilling, selected holes will undergo hydrological testing and monitoring to characterize the overall surficial and deposit hydrology and water quality.

In addition to assaying the core, selected drill core will undergo advanced

metallurgical, geochemical, and specific gravity tests to assist in building a geometallurgical model for the deposit.

Camp opened in mid-July and the drilling program is expected to last approximately three months.

Lucky Shot Project

The Lucky Shot project remains in care and maintenance as the Company plans a surface and underground drilling program for 2025.

All other projects are in the exploration stage.

HighGold Acquisition

On May 1, 2024, the Company entered into a definitive arrangement agreement (the “Arrangement Agreement”) by and among the Company, Contango Mining Canada Inc., a corporation organized under the laws of British Columbia and a wholly owned subsidiary of the Company, and HighGold Mining Inc., a corporation existing under the laws of the Province of British Columbia (“HighGold”), pursuant to which the Company acquired 100% of the outstanding equity interests of HighGold (the “HighGold Acquisition”) by way of a court approved plan of arrangement under the Business Corporations Act (British Columbia).

HighGold options were also exchanged, directly or indirectly, for Contango shares of common stock, based on the fair market value of the HighGold options prior to the closing date.

Upon closing of the HighGold Acquisition, the Company issued an aggregate of 1,698,887 shares of Contango common stock, with a value of approximately $33.4 million, to HighGold shareholders in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 3(a)(10) of the Securities Act.

Upon completion of the Acquisition, existing Contango shareholders own approximately 85.9% and HighGold shareholders own approximately 14.1% of the combined company.

Avidian Alaska Acquisition

On May 1, 2024, the Company entered into a stock purchase agreement with Avidian Gold Corp.

(“Avidian”) pursuant to which the Company has agreed to purchase Avidian’s 100% owned Alaskan subsidiary, Avidian Gold Alaska Inc., for initial consideration of $2,400,000, with a contingent payment for up to $1,000,000 (the “Avidian Alaska Acquisition”).

On August 6, 2024, the Company completed the Avidian Alaska Acquisition.

As contemplated by the stock purchase agreement entered into with Avidian, the initial purchase price of $2,400,000 consisted of (i) $400,000 in cash (the “Cash Consideration”) and (ii) $2,000,000 in shares of Contango common stock, with $250,000 of such shares withheld at closing and to be paid only upon settlement of a withholding contingency (the “Equity Consideration”).

The Cash Consideration shall be paid in the following tranches:

(i) a deposit of $50,000 (paid), (ii) $150,000 to be paid upon settlement of a withholding contingency and (iii) $200,000 of the Cash Consideration to be paid on or before the six-month anniversary of the closing date.

Underwritten Offering

On June 10, 2024, the Company entered into an underwriting agreement with Canaccord Genuity LLC and Cormark Securities Inc.

(collectively, the “June 2024 Underwriters”), relating to an underwritten public offering (the “June 2024 Offering”) of 731,750 units (the “Units”) of the Company at a price of $20.50 per Unit.

Each Unit consisted of (i) one share of the Company's common stock and (ii) one-half of one accompanying warrant.

Each whole accompanying warrant is exercisable to purchase one share of the Company's common stock at a price of $26.00 per warrant, exercisable for a period of 36 months.

The June 2024 Underwriters agreed to purchase the Units from the Company pursuant to the June 2024 Underwriting Agreement at a price of $19.37 per Unit, which included a 5.5% underwriting discount.

The net proceeds from the June 2024 Offering were $13.7 million after deducting underwriting discounts and commissions and offering expenses.

The June 2024 Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3.

The June 2024 Offering closed on June 12, 2024.

Committee for Safe Communities Complaint

On October 20, 2023, the Committee for Safe Communities (“CSC”), an Alaskan non-profit corporation inclusive of certain vacation homeowners along the Manh Choh ore haul route and others, filed suit in the Superior Court for the State of Alaska in Fairbanks, Alaska (the “Superior Court”) against the State of Alaska, Department of Transportation and Public Facilities (the “DOT”), seeking

injunctive relief with respect to CSC’s oversight of the Peak Gold JV’s ore haul plan.

Ore from the Manh Choh mine is being trucked to the Fort Knox mill for processing via public roadways in state-of-the-art trucks carrying legal loads.

On November 2, 2023, CSC filed a motion for preliminary injunction.

On November 9, 2023, the Peak Gold JV filed a motion to intervene in this lawsuit, which was granted on November 15, 2023.

On January 15, 2024, Peak Gold and DOT jointly moved for judgment on the pleadings and to stay all discovery.

On May 14, 2024, the Court issued an Order denying the plaintiff’s motion for preliminary injunction and staying discovery.

The Order further lifted the stay of discovery.

On July 3, 2024, the DOT filed motion for reconsideration as to the Court’s Order on the motion for judgment on the pleadings, which Peak Gold joined.

At a scheduling conference on July 16, 2024, the Court ordered plaintiff to respond to the motion for reconsideration and set a trial for August 11, 2025.

Dot Lake Complaint

Army Corps of Engineers (the “Corps”) and Lt.

General Scott A.

Spellmon, in his official capacity as Chief of Engineers and Commanding General of the Corps.

Peak Gold is not named as a defendant in the complaint and it is evaluating its options with respect to protecting its interests in continuing to operate the Manh Choh mine.

The Company engages in exploration and development for gold ore and associated minerals in Alaska.

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The Lucky Shot Property and the Minerals Property are collectively referred to in this Quarterly Report on Form 10-Q as the “Contango Properties”.

The Company’s Manh Choh Project has commenced ore mining and stockpiling at the Fort Knox facility.

The Company’s Manh Choh Project achieved a significant milestone on July 8, 2024 and poured its first gold bar.The ore mining continues along with stockpiling ore at the Fort Knox facility.

The Project is on schedule and full commissioning of the modifications at the Fort Knox mill is expected in the third quarter.

The Project remains on track to deliver its planned production this year.

All other projects are in the exploration stage.

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(“KG Mining”), an indirect wholly-owned subsidiary of Kinross Gold Corporation (“Kinross”).

Kinross is a large gold producer with a diverse global portfolio and extensive operating experience in Alaska.

Kinross is a large gold producer with a diverse global portfolio and

extensive operating experience in Alaska.

The Peak Gold JV will mine ore from the Main and North Manh Choh deposits and process the ore at the existing Fort Knox mining and milling complex located approximately 240 miles (400 km) away in Fairbanks, Alaska.

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The Peak Gold JV management committee (the “JV Management Committee”) has approved budgets for 2023 and 2024, with cash calls totaling approximately $248.1 million, of which the Company’s share is approximately $74.5 million.

As of March 31, 2024, the Company has funded $62.7 million of the budgeted cash calls.

As of June 30, 2024, the Company has funded $74.5 million of the budgeted cash calls.

On May 15, 2023, the Peak Gold JV received approval of its Waste Management Plan, Plan of Operations, and Reclamation and Closure Plan from the State of Alaska Departments of Environmental Conservation and Natural Resources.

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Modifications to the Fort Knox mill continue to progress on schedule and on budget.

Construction of the conveyors and associated buildings are planned for the first quarter along with interior piping and mechanical installations.

The commissioning and operational readiness team is in place and preparing for pre-commissioning activities

following the mechanical completion of each area.

Construction of the conveyors and associated buildings are complete, along with interior piping and mechanical installations.

Full commissioning of the modificaitons at the Fort Knox mill is expected in the third quarter of this year.

Kinross, on behalf of the Peak Gold JV, is also continuing its comprehensive community programs and prioritizing local economic benefits as it develops the project.

All permitting activities are completed with all major permits received from both Federal and State permitting agencies.

The Peak Gold JV believes that production is expected to commence at Manh Choh in the second half of 2024, with a mine plan that consists of two small, open pits that will be mined concurrently over 4.5 years.

Peak Gold JV production commenced at Manh Choh in the second half of 2024, with a mine plan that consists of two small, open pits that will be mined concurrently over 4.5 years.

Work on the Lucky Shot Property has been ongoing since late 2021.

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On the Shamrock and Eagle/Hona Properties, the Company conducted surface mapping and sampling programs during 2021.

Recent Developments and Other Information

On May 1, 2024, the Company entered into a definitive arrangement agreement (the “Arrangement Agreement”), by and among the Company, Contango Mining Canada Inc., a corporation organized under the laws of British Columbia and a wholly owned subsidiary of the Company, and HighGold Mining Inc., a corporation existing under the laws of the Province of British Columbia (“HighGold”), pursuant to which the Company intends to acquire 100% of the outstanding equity interests of HighGold (the “HighGold Acquisition”).

The Exchange Ratio implies total consideration of approximately $0.40 per HighGold share and total HighGold equity value of approximately $37 million.

Upon completion of the HighGold Acquisition, existing Contango shareholders will own approximately 85% and HighGold shareholders will own approximately 15% of the combined company.

In connection with the HighGold Acquisition, Contango will grant to HighGold the right to appoint one director to Contango’s board of directors.

Closing of the HighGold Acquisition is subject to customary closing conditions and is expected to occur in July 2024.

The Arrangement Agreement contains customary representations, warranties and covenants and also includes indemnification provisions under which the parties have agreed to indemnify each other against certain liabilities.

On May 1, 2024, the Company entered into a stock purchase agreement with Avidian Gold Corp.

(“Avidian”) pursuant to which the Company has agreed to purchase Avidian’s 100% owned Alaskan subsidiary, Avidian Gold Alaska Inc., for initial consideration of $2,400,000, with a contingent payment for up to $1,000,000 (the “Avidian Acquisition”).

Closing of the Avidian Acquisition is subject to customary closing conditions and is expected to occur in July 2024.

The Company is a 30% owner of the Peak Gold JV, which operates the Manh Choh mine near Tok, Alaska.

Ore from the mine is being trucked to the Fort Knox mill for processing via public roadways in state-of-the-art trucks carrying legal loads.

Certain owners of vacation homes along the ore haul route and others claiming potential impact have organized a group to oppose the ore haul plan and disrupt the project.

These efforts have included administrative appeals of certain state mine permits unrelated to ore haul.

To date, those appeals have been unsuccessful.

On October 20, 2023, the Committee for Safe Communities (“CSC”), an Alaskan non-profit corporation inclusive of certain owners of vacation homes along the Manh Choh ore haul route and others claiming potential impact and objecting to the ore haul plan and project, filed suit (the “Complaint”) in the Superior Court in Fairbanks, Alaska against the State of Alaska Department of Transportation and Public Facilities (“DOT”).

The Complaint seeks injunctive relief against the DOT with respect to its oversight of the Peak Gold JV’s ore haul plan.

The Complaint alleges that the DOT has approved a haul route and trucking plan that violates DOT regulations, DOT’s actions have created an unreasonable risk to public safety constituting an attractive public nuisance, and DOT has aided and abetted the offense of negligent driving.

On November 2, 2023, CSC filed a motion for a preliminary injunction against the DOT and is seeking expedited consideration of its motion.

The Peak Gold JV is also in consultation with DOT on addressing the allegations raised.

On November 9, 2023, the Court denied CSC's motion for expedited consideration of the motion for preliminary injunction.

The Peak Gold JV filed a motion to intervene and on November 15, 2023, the Court granted such motion to intervene.

The plaintiff’s motion for a preliminary injunction is fully briefed and awaiting decision by the Court.

On December 15, 2023, the plaintiff filed a motion for a hearing on its motion for preliminary injunction, which has been fully briefed, and is awaiting decision by the Court.

On January 15, 2024, Peak Gold and DOT jointly moved for judgment on the pleadings and to stay all discovery, which motions remain pending.

Partnering with strategic industry participants to expand future exploration work.

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The JV Management Committee currently consists of one appointee designated by the Company and two appointees designated by KG Mining.

The Representatives designated by each member of the Peak Gold JV vote as

a group, and in accordance with their respective membership interests in the Peak Gold JV.

The Representatives designated by each member of the Peak Gold JV vote as a group, and in accordance with their respective membership interests in the Peak Gold JV.

Except in the case of certain actions that require approval by unanimous vote of the Representatives, the affirmative vote of a majority of the membership interests in the Peak Gold JV constitutes the action of the JV Management Committee.

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restricted stock and stock options.

As of March 31, 2024, the Company’s directors and executives beneficially own approximately 17.4% of the Company’s common stock.

As of June 30, 2024, the Company’s directors and executives beneficially own approximately 13.9% of the Company’s common stock.

Acquiring exploration properties .

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Acquiring additional properties will likely result in additional expense to the Company for minimum royalties, minimum rents and annual exploratory work requirements.

The Company is open to strategic partnerships or alliances with other companies as a means to enhance its ability to fund new and existing exploration and development opportunities.

The Company is open to strategic

partnerships or alliances with other companies as a means to enhance its ability to fund new and existing exploration and development opportunities.

Off-Balance Sheet Arrangements

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Results of Operations

Neither the Company nor the Peak Gold JV has commenced producing commercially marketable minerals.

To date, neither the Company nor the Peak Gold JV has generated any revenue from mineral sales or operations.

Neither the Company nor the Peak Gold JV has any recurring source of revenue.

As of June 30, 2024, neither the Company nor the Peak Gold JV has commenced producing commercially marketable minerals.

Neither the Company nor the Peak Gold JV has generated any revenue from mineral sales or operations, including any reoccuring source of revenue.

The Company’s ability to continue as a going concern is dependent on the Company’s ability to raise capital to fund future exploration, and repay debt obligations and related interest, and working capital requirements.

In the future, the Company and the Peak Gold JV may generate revenue from a combination of mineral sales and other payments resulting from any commercially recoverable minerals from the Manh Choh Project.

The Company does not expect the Peak Gold JV to generate revenue from mineral sales prior to mid-2024.

On July 8, 2024, the Peak Gold JV poured its first gold bar.

The ore mining continues along with stockpiling ore at the Fort Knox facility.

The Project is on schedule and full commissioning of the modifications at the Fort Knox mill is expected in the third quarter.

The Project remains on track to deliver its planned production this year.

If the Company’s properties or the Manh Choh Project fail to contain any proven reserves, the Company’s ability to generate future revenue, and the Company’s results of operations and financial position, would be materially adversely affected.

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The Company will need to generate significant revenues to achieve profitability and the Company may never do so.

Three Months Ended March 31 , 202 4 Compared to Three Months Ended March 31, 2023

Three Months Ended June 30 , 202 4 Compared to Three Months Ended June 30, 2023

Claim Rentals Expense.

Claim rental expense primarily consists of State of Alaska rental payments and costs incurred to record annual labor documents.

For the three months ended March 31, 2024 and 2023, claim rental expense was $0.1 million and $0.1 million respectively.

For the three months ended June 30, 2024 and 2023, claim rental expense were $0.1 million and $0.1 million respectively.

Exploration Expense.

Exploration expense for the three months ended March 31, 2024 was $0.1 million compared to $0.3 million for the three months ended March 31, 2023.

Exploration expense for the three months ended June 30, 2024 was $0.1 million compared to $1.0 million for the three months ended June 30, 2023.

Current and prior period exploration expense relates to care and maintenance work performed on our Lucky Shot Property.

General and Administrative Expense.

General and administrative expense for the three months ended M arch 31, 2024 and 2023 was $2.5 million and $2.0 million, respectively.

General and administrative expense for the three months ended J une 30, 2024 and 2023 were $2.2 million and $2.5 million, respectively.

The Company’s general and administrative expense primarily relates to legal fees, regulatory fees, payroll and stock-based compensation expense.

General and administrative expenses were higher for the three months ended March 31, 2024, as a result of a surety bond requirement for the Manh Choh Project and an increase in audit and legal fees as a result of changing the Company's year-end to December 31, 2023.

Loss from Equity Investment in the Peak Gold JV .

The loss from the Company’s equity investment in the Peak Gold JV for the three months ended March 31, 2024 and 2023 was $0.1 million and $5.1 million, respectively.

The capital contributions for the three months ended March 31, 2024 and 2023 was $15.5 million and $5.1 million, respectively.

The capital contributions are higher for three months ended March 31, 2024 compared to March 31, 2023 as operations are ramping up at the Manh Choh project with ore and waste mining ongoing and focus on capital improvements at the Fort Knox mill facility.

There were no suspended losses as of March 31, 2024.

The loss from the Company’s equity investment in the Peak Gold JV for the three months ended June 30, 2024 and 2023 was $1.0 million and $6.7 million, respectively.

The capital contributions for the three months ended June 30, 2024 and 2023 was $11.8 million and $6.7 million, respectively.

The capital contributions are higher for three months ended June 30, 2024 compared to June 30, 2023 as operations are ramping up at the Manh Choh project with ore and waste mining ongoing and focus on capital improvements at the Fort Knox mill facility.

There were no suspended losses as of June 30, 2024.

Interest Expense.

In connection with the closing of the Credit Agreement, the Company entered into an amendment to its $20,000,000 unsecured convertible debenture (the “Debenture”) with Queen’s Road Capital Investment, Ltd.

(“QRC”) that raised the stated interest rate from 8% to 9%.

The Debenture currently bears interest at 9% per annum, payable quarterly, with 7% paid in cash and 2% paid in shares of common stock of the Company (See Note 14 - Debt for discussion of both debt arrangements).

The current quarter interest expense of $2.0 million includes a full quarter of interest expense related to the Debenture, and a full quarter of interest expense related to the Company’s cumulative $42.5 million draw-down on the Facility.

Prior year interest expense of $0.4 million only included the current quarter interest expense related to the Debenture.

For the three months ended June 30, 2024 interest expense was $2.9 million related to the Queen's Road Capital Investment, Ltd.

Debenture (the "Debenture") and interest expense related to the Company’s cumulative $60.0 million draw-down on the Facility.

Prior year interest expense of $1.0 million included interest expense related to the Debenture and interest expense related to the Company's cumulative $10 million draw-down on the Facility.

See Note 13 - Debt.

Loss on Derivative Contracts.

The Company incurred a non-cash loss of $15.6 million during the current quarter related to derivative contracts compared to $0 during the quarter ended March 31, 2023.

The Company incurred a non-cash loss of $12.6 million during the threre months ended June 30, 2024 related to derivative contracts compared to $0 during the three months ended June 30, 2023.

The Company did not enter into any derivative contracts until July 2023 (see Note 14 - Derivative and Hedging Activities).

Six Months Ended June 30, 2024 Compared to Six Months Ended June 30, 2023

Claim Rentals Expense.

Claim rental expense primarily consists of State of Alaska rental payments and costs incurred to record annual labor documents.

For the six months ended June 30, 2024 and 2023, claim rental expense was $0.3 million and $0.3 million respectively.

Exploration Expense.

Exploration expense for the six months ended June 30, 2024 was $0.1 million compared to $1.3 million for the six months ended June 30, 2023.

Current and prior period exploration expense relates to care and maintenance work performed on our Lucky Shot Property.

General and Administrative Expense.

General and administrative expense for the six months ended June 30, 2024 and 2023 were $4.7 million and $4.5 million, respectively.

The Company’s general and administrative expense primarily relates to legal fees, regulatory fees, payroll and stock-based compensation expense.

General and administrative expenses were slightly higher for the six months ended June 30, 2024, as a result of a surety bond requirement for the Manh Choh Project.

Loss from Equity Investment in the Peak Gold JV .

The loss from the Company’s equity investment in the Peak Gold JV for the six months ended June 30, 2024 and 2023 was $1.0 million and $11.8 million, respectively.

The capital contributions for the six months ended June 30, 2024 and 2023 was $27.2 million and $11.8 million, respectively.

The capital contributions are higher for six months ended June 30, 2024 compared to June 30, 2023 as operations are ramping up at the Manh Choh project with ore and waste mining ongoing and focus on capital improvements at the Fort Knox mill facility.

There were no suspended losses as of June 30, 2024.

Interest Expense.

For the six months ended June 30, 2024 interest expense was $5.0 million related to the Debenture and interest expense related to the Company’s cumulative $60.0 million draw-down on the Facility.

Prior year interest expense of $1.1 million included interest expense related to the Debenture and interest expense related to the Company's cumulative $10 million draw-down on the Facility.

See Note 13 - Debt.

Loss on Derivative Contracts.

The Company incurred a non-cash loss of $28.2 million during the six months ended June 30, 2024 related to derivative contracts compared to $0 during the six months ended June 30, 2023.

The Company did not enter into any derivative contracts until July 2023 (see Note 14 - Derivative and Hedging Activities).

Liquidity and Capital Resources

As of March 31, 2024, the Company had approximately $7.9 million of cash.

As of June 30, 2024, the Company had approximately $24.3 million of cash.

The Company’s primary cash requirements have been for general and administrative expenses, capital calls from the Peak Gold JV for the Manh Choh Property, repayment of interest related to debt and exploration expenditures on the Lucky Shot Property.

The Company’s sources of cash have been from common stock offerings, the issuance of the Debenture, and the proceeds from the Facility (see Note 8 - Stockholders' Equity (Deficit) and Note 13 - Debt, for a discussion of the recent activity).

The budget primarily relates to completion of the Manh Choh camp, mine access road construction, earthworks, general construction and installation, pre-production stripping, etc.

For 2024, it is anticipated that there will be $27.2 million of capital calls to the Peak Gold JV to reach production, $15.5 million of such amount has already been funded by the Company.

As of March 31, 2024, the Company has funded $62.7 million of the 2023 and 2024 capital calls to the Peak Gold JV, of which $42.5 million was funded from the Facility.

The JV Management Committee has proposed a significant budget to complete the required development to start the operations of the Manh Choh mine, which began production during the second half of 2024.

On July 8, 2024, the Peak Gold JV poured its first gold bar.

The ore mining continues along with stockpiling ore at the Fort Knox facility.

The Project is on schedule and full commissioning of the modifications at the Fort Knox mill is expected in the third quarter.

The Project remains on track to deliver its planned production this year.

For fiscal 2024, it was anticipated that there would be $31.3 million of capital calls to the Peak Gold JV to reach production.

The Company has already funded the $31.3 million as of July 31, 2024.

As of July 31, 2024, the Company has funded $78.6 million of the 2023 and 2024 capital calls to the Peak Gold JV, of which $60.0 million was funded from the Facility.

The Company will be required to make capital contributions of 30% of the budgeted amounts when cash calls are received from the Peak Gold JV or face possible dilution of its interest in the Peak Gold JV.

The budget primarily relates to continued ore and waste mining

along with mill modifications at the Fort Know mill.

Including the completion of the ore delivery road and tie-ins for the pebble recycle conveyor.

The Company believes it has sufficient capital to reach production at the Manh Choh mine, with its cash on hand and the $22.5 million of availability under the Facility.

Although there can be no guarantee that the Peak Gold JV will make distributions to the Company, the Company believes that distributions are probable and that it will maintain sufficient liquidity to meet its working capital requirements, including repayment obligations of approximately $29.9 million on the secured credit facility, for the next twelve months from the date of this report.

The Company believes it has sufficient capital to continue production at the Manh Choh mine, with its cash on hand and the $5.0 million of availability under the Facility.

Although there can be no guarantee that the Peak Gold JV will make distributions to the Company, the Company believes that distributions are probable and that it will maintain sufficient liquidity to meet its working capital requirements, including repayment obligations of approximately $29.9 million on the Facility, for the next twelve months from the date of this report.

Failure to pay current debt obligations will result in an event of default and the Company's debt would be due immediately or callable (See Note 13).

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If the Company’s interest in the Peak Gold JV is diluted, the Company may not be able to fully realize its investment in the Peak Gold JV.

additional financing is obtained, the Company may not be able to fully realize its investment in the Contango Properties.

Also, if no additional financing is obtained, the Company may not be able to fully realize its investment in the Contango Properties.

The Company has limited financial resources and the ability of the Company to refinance current debt or arrange additional financing in the future will depend, in part, on the prevailing capital market conditions, the results achieved at the Peak Gold JV Property, as well as the market price of metals.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements