See accompanying notes to the unaudited financial statements.

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

See accompanying notes to the unaudited financial statements.

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(Unaudited)

See accompanying notes to the unaudited financial statements.

ATHENA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

See accompanying notes to the unaudited financial statements.

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Organization, BasisNature of Presentation, LiquidityBusiness and Going ConcernSummary of Significant Accounting Policies

Nature of OperationsOperations

Athena Gold Corporation (“we,” “our,” “us,” or “Athena”) is engaged in the acquisition and exploration of mineral resources. We were incorporated in Delaware on December 23, 2003 and began our mining operations in 2010.

In December 2009, we formed and organized a wholly-owned subsidiary, Athena Minerals, Inc. (“Athena Minerals”) which owns and operates mining interests and property in California. On December 31, 2020 we sold the subsidiary to Tripower Resources Inc., a company controlled by Mr. John Gibbs, a related party, in a non-cash exchange. This transaction is discussed in further detail in our Annual Report on Form 10-K for the year ended December 31, 2020.

Effective December 15, 2020, Athena entered into a definitive Property Option AgreementThe Company’s properties do not have any reserves. The Company plans to conduct exploration programs on these properties with Nubian Resources Ltd. (“Nubian”) (TSXV: NBR), pursuant to which Nubian has granted Athena the option to acquire a 100% interest in Nubian’s Excelsior Springs exploration project located in Esmeralda County, Nevada. Detailsobjective of this transactionascertaining whether any of its properties contain economic concentrations of precious and base metals that are further discussed in Note 2 – Mineral Rights – Excelsior Springs.prospective for mining.

Our primary focus going forward will be to continue evaluating of our properties, and possible acquisitions of additional mineral rights and exploration, all of which will require additional capital. Further information regarding our mineral rights are discussed below in Note 2 – Mineral Rights – Excelsior Springs, as well as in our Annual Report on Form 10-K for the year ended December 31, 2020.

Basis of Presentation

On December 31, 2020 we sold our wholly-owned subsidiary, Athena Minerals Inc. to a related party shareholder in a non-cash exchange. As such, operating results for all reporting periods prior to January 1, 2021 include the operations of Athena Minerals, Inc., while all reporting periods subsequent to December 31, 2020 do not include the operations of Athena Minerals, Inc.

We prepared these interim financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”). The accompanying unaudited interim financial statements have been prepared in accordance with GAAP for interim financial information and in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month periods ended March 31, 20212022 are not necessarily indicative of the results for the full year. While we believe that the disclosures presented herein are adequate and not misleading, these interim consolidated financial statements should be read in conjunction with the audited financial statements and the footnotes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2020.2021.

Reclassifications

Certain reclassifications may have been made to our prior year’s consolidated financial statements to conform to our current year presentation. These reclassifications had no effect on our previously reported results of operations or accumulated deficit.

Foreign Currency Translation

The Company is exposed to currency risk on transactions and balances in currencies other than the functional currency. The Company has not entered any contracts to manage foreign exchange risk.

The functional currency of the Company is the US dollar; therefore, the Company is exposed to currency risk from financial assets and liabilities denominated in Canadian dollars.

Recent Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Liquidity and Going Concern

Our interim financial statements have been prepared on a going concern basis, which assumes that we will be able to meet our obligations and continue our operations during the next fiscal year. Asset realization values may be significantly different from carrying values as shown in our consolidated financial statements and do not give effect to adjustments that would be necessary to the carrying values of assets and liabilities should we be unable to continue as a going concern.

At March 31, 2021,2022, we had not yet achieved profitable operations and we have accumulated losses of $10,245,857approximately $10,757,19611,000,000 since our inception. We expect to incur further losses in the development of our business, all of which raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate future profits and/or to obtain the necessary financing to meet our obligations arising from normal business operations when they come due.

DuringImpairment of Long-lived Assets

We continually monitor events and changes in circumstances that could indicate that our carrying amounts of long-lived assets, including mineral rights, may not be recoverable. When such events or changes in circumstances occur, we assess the quarter ended March 31, 2021recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through their undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of these assets, we sold 5,000,000recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets.

Notes Payable - Related Party

Related party payables are classified as current liabilities as the note holders are control persons and have the ability to control the repayment dates of the notes.

Exploration Costs

Mineral exploration costs are expensed as incurred. When it has been determined that it is economically feasible to extract minerals and the permitting process has been initiated, exploration costs incurred to further delineate and develop the property are considered pre-commercial production costs and will be capitalized and included as mine development costs in our consolidated balance sheets.

Stock-Based Compensation

Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). This ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

The estimated fair value of each stock option as of the date of grant was calculated using the Black-Scholes pricing model. The Company estimates the volatility of its common stock at the date of grant based on Company stock price history. The Company determines the expected life based on the simplified method given that its own historical share option exercise experience does not provide a reasonable basis for estimating expected term. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The shares of common stock in private placements realizing proceedssubject to the stock-based compensation plan shall consist of $150,000. We anticipateunissued shares, treasury shares or previously issued shares held by any subsidiary of the Company, and such number of shares of common stock are reserved for such purpose.

Fair Value of Financial Instruments

Fair value is defined as the exchange price that future funding willwould be received for an asset or paid to transfer a liability (an exit price) in the formprincipal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of additional equity financing from the saleinputs that may be used to measure fair value:

Level 1 - Valuation based on quoted market prices in active markets for identical assets and liabilities.

Level 2 - Valuation based on quoted market prices for similar assets and liabilities in active markets.

Level 3 - Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of our common stock, or loans from officers, directors or significant shareholders. Currently, therewhat market participants would use as fair value.

The fair value of cash, receivables and accounts payable approximates their carrying values due to their short term to maturity. The warrant liabilities are no arrangements in place for additional equity funding or new loans.measured using level 3 inputs (Note 4).

Earnings (Loss) per Common Share

The Company incurred a net income and net loss for the three months ended March 31, 2022 and 2021, respectively. In periods where the Company has a net income certain options and warrants are included in the computation of diluted shares outstanding, however, the options and warrants were not included in the calculation because they were “out-of-the money”. In periods where the Company has a net loss, all common stock equivalents are excluded as they would be anti-dilutive.

COVID-19 pandemicPandemic:

An occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. The occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. A pandemic typically results in social distancing, travel bans and quarantine, and this may limit access to our facilities, customers, management, support staff and professional advisors. These factors, in turn, may not only impact our operations, financial condition and demand for our goods and services but our overall ability to react timely to mitigate the impact of this event. Also, it may hamper our efforts to comply with our filing obligations with the Securities and Exchange Commission.

Note 2 – Mineral Rights - Excelsior Springs

Effective December 15, 2020, Athena entered into27, 2021 (“Effective Date”), the Company simultaneously executed and consummated a definitive Property OptionShare Purchase Agreement (the “SPA”) with Nubian Resources, Ltd. (“Nubian”) (TSXV: NBR), pursuant. The SPA was the result of a previously disclosed Option Agreement with Nubian dated as of December 11, 2020, as amended by First Amendment to which Nubian hasOption Agreement dated November 10, 2021 (the “Option”). While the Option granted Athena the optionCompany the right to acquire up to a 100% interest in Nubian’sthe mining claims comprising the Excelsior Springs exploration projectProspect (the “Property”) located in EsmeraldaEsmerelda County, Nevada.

The Option is exercisableNevada, the Company and Nubian agreed to restructure the transaction so that the Company purchased 100% of the issued and outstanding shares of common stock of Nubian Resources USA, Ltd (“Nubian USA”), a wholly-owned subsidiary of Nubian which held the Property. By purchasing 100% of Nubian USA, the Company effectively acquired the remaining 90% interest in two tranches: the first tranche was exercised immediately pursuant to whichProperty, the Company having previously acquired a 10% interest in Excelsior Springsthe Property in consideration of issuing to Nubian an aggregate of 5,000,000 shares of Athena Gold Corporation common stock. On December 15, 2020 the company issued the 5,000,000 shares of its common stock valued at $0.03 per share totaling $150,000. The second tranche is exercisable on or before December 31, 2021 to purchase an additional 90% interest in Excelsior Springs in consideration of issuing to Nubian an additional 45 million shares of Athena common stock. Should both options be exercised, Nubian will hold 50 million shares of Athena common stock, which will be subject to a six-month lockup.

Athena’s agreement with Nubian includes 100% of the 140 unpatented claims at Excelsior Springs with two additional patented claims held under a lease option that are subject to a 2% net smelter returns royalty on gold production. Under the terms of the Option Agreement, Nubian will retain a 1% net smelter returns royalty (“NSR Royalty”) on the Excelsior Springs Project if Athena fully exercises the option. Athena will have the right to purchase 0.5% (being one half) of the NSR Royalty for CAD $500,000 and the remaining 0.5% of the NSR Royalty at fair market value.

Note 3 – Fair Value of Financial Instruments

Financial assets and liabilities recorded at fair value in our balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:

Level 1 – Quoted market prices in active markets for identical assets or liabilities at the measurement date.

Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.

Level 3 – Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.

A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.Option.

The carrying values of cash and cash equivalents, accounts payable, accrued liabilities and other short-term debt, approximate their fair value becausefollowing is a summary of the short-term natureterms of these financial instruments.the SPA, which summary is qualified in its entirety by reference to the SPA:

The mineral property was valued at the December 31, 2021, the closing date for the SPA with a stock price of $0.13, resulting in a fair value consideration of $5,850,000 for the 45,000,000 shares issued. The transaction does not constitute a business combination in accordance with ASC 805, which defines a business as an integrated set of activities and assets capable of being conducted and managed for the purposes of providing a return to investors or other participants and that a business consists of inputs and processes applied to those inputs that have the ability to contribute to the creation of outputs. Management has determined that the acquired assets do not contain processes sufficient to constitute a business in accordance with ASC 805. The transaction represents the acquisition of assets in exchange for the assumption of liabilities and the issuance of share-based payments.

Note 43 – Convertible Note Payable

Effective April 1, 2015, the Company executed a convertible promissory note (the “Note”) in the principal amount of $51,270$51,270 in favor of Clifford Neuman, the Company’s legal counsel, representing accrued and unpaid fees for past legal services. The Note iswas unsecured and accruesaccrued interest at the rate of 6%6% per annum, compounded quarterly, and iswas due on demand. The principal and accrued interest due under the Note may be converted,was convertible, at the option of the holder, into shares of the Company’s common stock.

On April 24, 2020, the Company agreed to reduce the conversion price from $0.0735 per share to $0.021 per share. All other terms of the convertible note remain unchanged, and therefore did not change the cash flows of the note. The Company determined the transaction was considered an extinguishment because of the change in conversion price in which no gain or loss was recorded according to ASC 470-50. However, because the conversion price was reduced below the $0.03 market value on the date of the change, a beneficial conversion feature resulted from the price reduction in the amount of $21,973,$21,973, which was accounted for as a discount to the debt and a corresponding increase in additional paid in capital. The debt discount is being amortized on a straight-line basis over one year to interest expense. A total of $5,493$5,493 was amortized to interest expense during the three months ended March 31, 2021. At2021, 0 interest in 2022.

On November 30, 2021, the Company received a notice of conversion of the Note with a principal balance of $51,270 and a conversion price of $0.021. On December 31, 2020 and March 31,3, 2021, a total of $7,324 and $1,831, respectively,2,441,476 shares of unamortized discounts remained and are presented as a reductionCommon Stock were issued. An additional 1,026,204 shares were issued for $21,550 of the Note principle on the accompanying balance sheets.

Accrued interest totaled $22,261 and $21,189 at March 31, 2021 and December 31, 2020, respectively, and is shown as Accruedaccrued interest on the accompanying balance sheets. Total interest expense associatedsame Note.

Note 4 – Common Stock and Warrants

During the twelve months ended December 31, 2021 we sold 14,358,700 shares of common stock in private placements realizing proceeds of $742,375.

On September 30, 2021 we completed a private placement in which we sold 3,108,700 units. Each unit was priced at CAD$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of CAD$0.15. The warrants expire May 31, 2024. All securities issued in connection with this Notethe offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 91,000 Broker Warrants (“Broker Warrants”) were granted to a Canadian broker as a placement fee. We realized total proceeds of $190,552 net of offering costs.

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and Hedging, the warrants have a derivative liability value.

At December 31, 2021, the warrant liability was $6,565valued at $341,145. As of March 31, 2022, the warrant liability was valued at $151,001, resulting in a gain on revaluation of warrant liability of $190,144 based on the following assumptions: 

The Broker Warrants were evaluated for purposes of classification between liability and $1,020equity. The Broker Warrants do not contain features that would require a liability classification and are therefore considered equity. The Black Scholes pricing model was calculated in US dollars to estimate the fair value of $7,472 with the following inputs: 

On May 25, 2021 we completed a private placement in which we sold 6,250,000 units. Each unit was priced at CAD$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of CAD$0.15. The warrants expire May 31, 2024. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 173,810 Broker Warrants (“Broker Warrants”) were granted to a Canadian broker as a placement fee. We realized total proceeds of $401,823 net of offering costs.

The warrants have an exercise price in Canadian dollars while the Company’s functional currency is US dollars. Therefore, in accordance with ASU 815 - Derivatives and Hedging, the warrants have a derivative liability value.

At December 31, 2021, the warrant liability was valued at $683,063. As of March 31, 2022, the warrant liability was valued at $281,109, resulting in a gain on revaluation of warrant liability of $401,954 based on the following assumptions: 

The Broker Warrants were evaluated for purposes of classification between liability and equity. The Broker Warrants do not contain features that would require a liability classification and are therefore considered equity. The Black Scholes pricing model was calculated in US dollars to estimate the three monthsfair value of $12,943 with the following inputs: 

During the quarter ended March 31, 2021, and 2020, respectively.we sold 5,000,000 shares of common stock in private placements to six individuals at a price of $0.03 per share, realizing total proceeds of $150,000. Of the 5,000,000 shares sold, 1,750,000 shares were issued on May 28, 2021.

Note 5 – Common Stock

On January 1, 2021 Mr. John Power, the Company’s CEO/CFO agreed to convert accrued management fees totaling $96,500.$96,500. As a result, we issued 2,144.4442,144,444 shares of common stock at a price of $0.045 per share.

During the quarter ended March 31, 2021, we sold 5,000,000 shares of common stock to six individuals at a price of $0.03 per share, realizing total proceeds of $150,000. Shares totaling 1,750,000 had not been issued as of this report date. As such the total proceeds of $52,500 have been recorded as an addition to paid in capital. 

Note 65 – Share Based Compensation

On March 22, 2021 the Company issued a total of 2,000,000 non-statutory stock options to four individuals, three of whichwhom are Directors of the Company, the other an independent technical consultant that is helping design our 2021 exploration programs at Excelsior Spring. Upon vesting, each option is exercisable to purchase one share of common stock at a price of $0.09 per share. The options vest 50% upon issuance, and 25% on each of the 1^stfirst and 2^ndsecond anniversaries of the grant date.

We estimated the fair value of the options using the Black-Scholes option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the options. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected remaining life of the options. The total estimated fair value of the options utilized the following assumptions:

The calculations resulted in the total fair value of the options issued to be $197,552.$190,202. We expense share-based compensation adjusted for estimated forfeitures, using the straight-line method over the vesting term of the award for our employees and directors and over the expected service term for our non-employee consultants. As such, a stock-based compensation charges totaling of $11,888 have been charged during the three months ended March 31, 2022. A summary of the stock based compensation chargeoptions as of $98,775 was recorded on March 22, 2021, representing all vested options,31, 2022 and is included in administrative expenses onchanges during the accompanying Statement of Operations.periods are presented below: 

Also, on March 22, 2021 the Company agreed to issue a total of 300,000 restricted stock units at a price of $0.10 per share to the independent technical consultant helping design our 2021 exploration programs at Excelsior Springs. However, the shares shall not be issued until such time the individual either provides a written request or his termination date, whichever is sooner. The shares shall have no voting rights until issued. As such, we have recorded stock-based compensation in the amount of $30,000 which was charged to exploration costs on the accompanying Statement of Operations. We have charged the $30,000 to stock based compensation, but since the shares have not been issued, we have recorded the full amount as an addition to paid in capital.$30,000.

Note 76 – Commitments and Contingencies

We are subject to various commitments and contingencies as discussed in Note 2 – Mineral Rights – Excelsior Springs.contingencies.

Note 87 – Related Party Transactions

Conflicts of Interests

Magellan Gold Corporation (“Magellan”) is a company under common control. Mr. John Power is a significant shareholder of both Athena and Magellan and an officer and director of Athena. Mr. John Gibbs is a significant shareholder in both Athena and Magellan. Athena and Magellan are both involved in the business of acquisition and exploration of mineral resources.

Silver Saddle Resources, LLC (“Silver Saddle”) is also a company under common control. Mr. Power and Mr. Gibbs are the owners and managing members of Silver Saddle. Athena and Silver Saddle are both involved in the business of acquisition and exploration of mineral resources.

There exists no arrangement or understanding with respect to the resolution of future conflicts of interest. The existence of common ownership and common management could result in significantly different operating results or financial position from those that could have resulted had Athena, Magellan and Silver Saddle been autonomous.

Management Fees – Related Parties

The Company is subject to a month-to-month management agreement with Mr. Power requiring a monthly payment of $2,500 as consideration for the day-to-day management of Athena. For each of the three months ended March 31, 2021 and 2020, a total of $7,500Athena, $7,500 was recorded as management fees and are included in general and administrative expenses in the accompanying consolidated statements of operations. At March 31, 2021 and December 31, 2020, $-0- and $96,500, respectively, of management fees due to Mr. Power had not been paid and are included in accrued liabilities – related parties on the accompanying consolidated balance sheets.

On January 1, 2021, the Company agreed to convert the $96,500$96,500 balance of management fees due Mr. Power into 2,144,444 shares of common stock at a price of $0.045 per share.

Accrued interest and Interest Expense – Related PartiesNote Payable

Related party interest primarily represented interestDuring March 2022, the Company executed two promissory notes with John Gibbs for $50,000 and $25,000 at 6% that is payable on demand.

Note 8 – Subsequent Events

In April 2022, the convertible credit facility whichCompany completed the sale of an aggregate of C$500,000 of its Units at a purchase price of C$.08 per Unit for a total of 6,250,000 Units. Each Unit consisted of one share of Common Stock and one common stock purchase warrant exercisable for three years to purchase one additional share of Common Stock at a price of C$0.15 per share. The transaction was settled as part of the saleCompany’s unregistered private offering of Athena Minerals, Inc. on December 31, 2020. Therefore, on December 31, 2020 all accrued and unpaid interest due Mr. Gibbs totaling $668,012 on the convertible credit facility was also waived as partup to C$500,000 in Units at a price of the sale of Athena Minerals transaction briefly discussed in Note 1 – Basis of presentation. Further information regarding this transaction is included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Total related party interest was $-0- and $27,573 for the three months ended March 31, 2021 and 2020, respectively.

Advances Payable - Related Parties

Mr. Power and Mr. Gibbs have advanced the Company funds generally utilized for day-to-day operating requirements. These advances are non-interest bearing and are generally repaid as cash becomes available.$0.08 per Unit. The Company also utilizes credit cards owned by Mr. Power to pay various obligations when an online payment is required, the availabilityissued 1,181,250 shares out of cash is limited, or the timing of the payments is considered critical.

During the three months ended March 31, 2021, Mr. Power made short-term advances to the Company totaling $9,245, and $17,845 was repaid during the period, leaving an unpaid balance of $13,298 included in Advances payable – related party on the accompanying balance sheets.

During the three months ended March 31, 2021, Mr. Power made short-term advances to the Company totaling $9,245, and $17,845  was repaid during the period, leaving an unpaid balance of $13,298 included in Advances payable – related party on the accompanying balance sheets.

Sale of Common Stock - Related Party

On January 15, 2021 the Company sold 250,0003,375,000 shares of common stock in April 2022 at a price of $0.03C$.08 per share inas a part of the private placement offering to settle $75,000 of notes payable to Mr. Gibbs, realizing total proceeds of $7,500.Gibbs.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

We use the terms “Athena,” “we,” “our,” and “us” to refer to Athena Gold Corporation.

The following discussion and analysis provide information that management believes is relevant for an assessment and understanding of our results of operations and financial condition. This information should be read in conjunction with our audited consolidated financial statements which are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020,2021, and our interim unaudited consolidated financial statements and notes thereto included with this report in Part I. Item 1.

Forward-Looking Statements

Some of the information presented in this Form 10-Q constitutes “forward-looking statements”. These forward-looking statements include, but are not limited to, statements that include terms such as “may,” “will,” “intend,” “anticipate,” “estimate,” “expect,” “continue,” “believe,” “plan,” or the like, as well as all statements that are not historical facts. Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from current expectations. Although we believe our expectations are based on reasonable assumptions within the bounds of our knowledge of our business and operations, there can be no assurance that actual results will not differ materially from expectations.

All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

Business Overview

We were incorporated on December 23, 2003, in Delaware and our principal business is the acquisition and exploration of mineral resources.

In January 2021, the company’s Board of Directors approved a name change from Athena Silver Corporation, to Athena Gold Corporation. Athena Gold Corporation (“we,” “our,” “us,” or “Athena”) is engaged in the acquisition and exploration of mineral resources. We were incorporated in Delaware on December 23, 2003 and began our mining operations in 2010.

In December 2009, we formed and organized a new wholly-owned subsidiary, Athena Minerals, Inc. (“Athena Minerals”) which ownedowns and operated ouroperates mining interests and propertiesproperty in California. On December 31, 2020 we sold the subsidiary to Tripower Resources Inc., a company controlled by Mr. John Gibbs, a related party, in a non-cash exchange. Further information regarding this transaction is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

In December 2020, Athena entered into a definitive Property Option Agreement with Nubian Resources Ltd. (“Nubian”) (TSXV: NBR), pursuant to which Athena acquired a 10% interest in Nubian’s Excelsior Springs exploration project located in Esmeralda County, Nevada and has an option to acquire the remaining 90% held by Nubian.

The Option is exercisable in two tranches: the first tranche was exercised immediately pursuant to which the Company acquired a 10% interest in Excelsior Springs in consideration of issuing to Nubian an aggregate of 5,000,000 shares of Athena Gold Corporation common stock.Company’s properties do not have any reserves. The Company issuedplans to conduct exploration programs on these properties with the 5,000,000 sharesobjective of ascertaining whether any of its common stock valued at $0.03 per share totaling $150,000 in December 2020. The second tranche is exercisable on or before December 31, 2021 to purchase an additional 90% interest in Excelsior Springs in considerationproperties contain economic concentrations of issuing to Nubian an additional 45 million shares of Athena common stock. Should both options be exercised, Nubian will hold 50 million shares of Athena common stock, which will be subject to a six-month lockup.

Athena’s agreement with Nubian includes 100% of the 140 unpatented claims at Excelsior Springs with two additional patented claims held under a lease optionprecious and base metals that are subject to a 2% net smelter returns royalty on gold production. Under the terms of the Option Agreement, Nubian will retain a 1% net smelter returns royalty (“NSR Royalty”) on the Excelsior Springs Project if Athena fully exercises the option. Athena will have the right to purchase 0.5% (being one half) of the NSR Royaltyprospective for CAD $500,000 and the remaining 0.5% of the NSR Royalty at fair market value.

Athena plans make Excelsior Springs its flagship project and has completed a N.I. 43-101 Technical Report to support its planned listing on a Canadian Stock Exchange that details historical exploration activities on the property, recent exploration activities conducted by Athena and also highlights future exploration plans to advance the Property.

We have not presently determined whether our mineral properties contain mineral reserves that are economically recoverable.

Reclassifications: Certain reclassifications may have been made to our prior year’s consolidated financial statements to conform to our current year presentation. These reclassifications had no effect on our previously reported results of operations or accumulated deficit.

COVID-19 pandemic: An occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. The occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations. A pandemic typically results in social distancing, travel bans and quarantine, and this may limit access to our facilities, customers, management, support staff and professional advisors. These factors, in turn, may not only impact our operations, financial condition and demand for our goods and services but our overall ability to react timely to mitigate the impact of this event. Also, it may hamper our efforts to comply with our filing obligations with the Securities and Exchange Commission.mining.

Results of Operations for the Three Months Ended March 31, 20212022 and 20202021

A summary of our results from operations is as follows:

During the three months ended March 31, 2021, our net loss was $256,972 as compared to a net loss of $63,616 during the same period in 2020. The $193,356 increase in our loss was mainly attributable to stock-based compensation resulting from the issuance of incentive stock options and restricted stock units, as well as increased legal and professional fees associated with the sale of Athena Minerals, Inc. and the acquisition of the Excelsior Springs project.

During the three months ended March 31, 2022, our net income was approximately $262,000 as compared to a net loss of approximately $257,000 during the same period in 2021. The 2022 operating loss of approximately $330,000 increased approximately $80,000 over the prior year period and was mainly attributable to the exploration and evaluation of the Excelsior Springs project. The 2022 net income was increased by approximately $593,000 gain on the change in value of the warrant liability associated with a private placement in May and September 2021.

Operating expenses:

Our total operating expenses increased $215,405,approximately $80,000, from $34,375approximately $250,000 to $249,780approximately $330,000 for the three months ended March 31, 20212022, and 2020,2021, respectively.

During the three months ended March 31, 2021,2022, we incurred $35,677approximately $193,000 of exploration costs. In March 2021, we issued 300,000 restricted stock units at a price of $0.10 per share to the independent technical consultant helping designcosts, which were costs associated with our 2021 exploration programs at Excelsior Springs. However, the shares shall not be issued until such time the individual either provides a written request or his termination date, whichever is sooner. The shares shall have no voting rights until issued. As such, we have recorded stock-based compensation in the amount of $30,000 which was charged to exploration costs. We have also begun preliminary workRC drill program on our future exploration programs which has resulted in an additional $5,677 of exploration costs. During the three months ended March 31, 2020, we incurred no exploration costs.

flagship Excelsior Springs project. Our general and administrative expenses increaseddecreased by $179,728,approximately $76,000, to approximately $138,000 from $34,375 to $214,103approximately $214,000 for the three months ended March 31, 20202022, and 2021.

Legal and professional fees for the three months ended March 31, 2021, totaled $111,954 and are attributed to legal and other professional fees associated with the acquisition of the Excelsior Springs project. Total legal costs for the three months ended March 31, 2020 totaled $27,409, an increase of $84,545 as compared to the three months ended March 31, 2021.respectively.

On March 22, 2021, the Company issued a total of 2,000,000 non-statutory stock options to four individuals, three of which are Directors of the Company, the other an independent technical consultant that is helping design our 2021 exploration programs at Excelsior Spring.consultant. Upon vesting, each option is exercisable to purchase one share of common stock at a price of $0.09 per share. The options vest 50% upon issuance, and 25% on each of the 1^st and 2^nd anniversaries of the grant date.

We estimated During each vesting period or upon the fair value of the options using the Black-Scholes option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the options. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected remaining life of the options. The total estimated fair value of the options utilized the following assumptions:

The calculations resulted in the total fair value of the options issued to be $197,552. Upon each vesting date a percentage of the total value of the options issued and outstanding is charged to stock-based compensation. As such,Stock based compensation expense decreased $117,000 year over year with an administrative expense charge of $98,775 was recorded on March 22, 2021.offsetting increase in professional fees.

Other income and expense:

OurOn May 25, 2021, we completed a private placement in which we sold 6,250,000 units. Each unit was priced at CAD$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of CAD$0.15. The warrants expire three years from the date of issuance. An additional 173,810 warrants were granted to a Canadian broker as a placement fee. We realized total other expenses,proceeds of $401,823 net of offering costs.

At December 31, 2021, the warrant liability was $7,192 during the three months endedvalued at $683,063. As of March 31, 2022, the warrant liability was valued at $281,109, resulting in a gain on revaluation of warrant liability of $401,954.

On September 30, 2021 we completed a private placement in which we sold 3,108,700 units. Each unit was priced at CAD$0.08 and consisted of one share of the Company’s common stock and one stock purchase warrant granting the holder the right to purchase one additional share of common stock at a price of CAD$0.15. The warrants expire May 31, 2024. All securities issued in connection with the offering are subject to restrictions on resale in Canada and the United States pursuant to applicable securities laws and the policies of any applicable stock exchange. An additional 91,000 Broker Warrants (“Broker Warrants”) were granted to a Canadian broker as compared toa placement fee. We realized total other incomeproceeds of $29,241 during$190,552 net of offering costs.

At December 31, 2021, the three months endedwarrant liability was valued at $341,145. As of March 31, 2020.

For2022, the three months ended March 31, 2021 other expenses consisted entirelywarrant liability was valued at $151,001, resulting in a gain on revaluation of interest expense associated with a convertible note payable originating in April 2015, from the conversionwarrant liability of certain amounts due our primary legal counsel.

For the three months ended March 31, 2020 other expenses consisted entirely of interest expense which included $27,573 in interest expense associated with our related party convertible credit facility, $1,020 of interest expense associated with a convertible note payable originating in April 2015, from the conversion of certain amounts due our primary legal counsel, as well as $648 of interest associated with the resolution of a 2019 franchise tax obligation which was paid during the quarter.$190,144

Liquidity and Capital Resources

Going Concern

Our consolidated financial statements have been prepared on a going concern basis, which assumes that we will be able to meet our obligations and continue our operations during the next fiscal year. Asset realization values may be significantly different from carrying values as shown in our consolidated financial statements and do not give effect to adjustments that would be necessary to the carrying values of assets and liabilities should we be unable to continue as a going concern.

At March 31, 2021,2022, we had not yet achieved profitable operations and we have accumulated losses of $10,245,857approximately $11,000,000 since our inception. We expect to incur further losses in the development of our business, all of which casts substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate future profits and/or to obtain the necessary financing to meet our obligations arising from normal business operations when they come due.

We have financed our capital requirements primarily through borrowings from related parties and equity financings. We expect to meet our future financing needs and working capital and capital expenditure requirements through additional borrowings and offerings of debt or equity securities, although there can be no assurance that our future financing efforts will be successful. The terms of future financing could be highly dilutive to existing shareholders. Currently, there are no arrangements in place for additional equity funding or new loans.

Liquidity

As of March 31, 2021,2022, we had $32,077approximately $40,000 of cash and a negative working capital of $117,393.approximately $245,000. This compares to cash on hand of $8,986approximately $32,000 and negative working capital of $235,696 at Decemberapproximately $117,000 on March 31, 2020.2021.

During the threetwelve months ended MarchDecember 31, 2021, we have sold 5,000,00014,358,700 shares of common stock in private placements realizing proceeds of $150,000.   Of this amount, shares totaling 1,750,000 had not been issued as of this report date and the associated proceeds of $52,500 have been recorded as an addition to paid in capital.$742,375. We anticipate that future funding will be in the form of additional equity financing from the sale of our common stock, or loans from officers, directors or significant shareholders. Currently, there are no arrangements in place for additional equity funding or new loans.

Cash Flows

A summary of our cash provided by and used in operating, investing and financing activities is as follows:

Net cash used in operating activities:

Net cash used in operating activities was $118,309approximately $108,000 and $25,679approximately $118,000 during the three months ended March 31, 20212022 and 2020,2021, respectively.

Cash used in operating activities during the three months ended March 31, 20212022, is primarily attributed to our $256,972 net loss. Non-cash charges to operating activities included total stock based compensation of $128,775, as well as amortization of debt discount on our convertible note payable totaling $5,493. We also realized increasesthe increase in accounts payable of $3,323, and other accrued liabilities of $1,072.$195,000

Cash used in operating activities during the three months ended March 31, 2020 is primarily attributed to our $63,616 net loss. We realized increases in accounts payable of $14,344, accrued interest on our notes payable of $27,573, and a decrease in other accrued liabilities of $3,980.

Net cash provided by financing activities:

Cash provided by financing activities during the three months ended March 31, 20212022, was $141,400 compared to cash provided by financing activitiesapproximately $75,000. During March 2022, the Company executed two promissory notes with John Gibbs for $50,000 and $25,000 at 6% that is payable on demand. Both notes were converted into shares as part of $38,300 during the same period in 2020.

During the three months ended March 31, 2021 the Company’s President had advanced a total of $9,245, and was repaid a total of $17,845. At March 31, 2021 unpaid advances totaled $13,298. Also during the quarter we sold 5,000,000 shares of our common stock in private placements at a price of $0.03 per share, resulting in total proceeds of $150,000. Of the total shares sold, 250,000 were sold to a significant shareholder related party.

For the three months ended March 31, 2020 borrowings under our convertible credit facility were $42,750. Also, during the period the Company’s President had advanced a total of $125, and was repaid a total of $4,575 associated with advances outstanding at December 31, 2019.

placement on April 13, 2022.

Off Balance Sheet Arrangements:

We do not have and never had any off-balance sheet arrangements.

Recent Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Critical Accounting Policies

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, assumptions and judgments that affect the amounts reported in our financial statements. The accounting positions described below are significantly affected by critical accounting estimates.

We believe that the significant estimates, assumptions and judgments used when accounting for items and matters such as capitalized mineral rights, asset valuations, recoverability of assets, asset impairments, taxes, and other provisions were reasonable, based upon information available at the time they were made. Actual results could differ from these estimates, making it possible that a change in these estimates could occur in the near term.

Foreign Currency

The Company is exposed to currency risk on transactions and balances in currencies other than the functional currency. The Company has not entered any contracts to manage foreign exchange risk. The functional currency of the Company is the US dollar; therefore, the Company is exposed to currency risk from financial assets and liabilities denominated in Canadian dollars.

Mineral Rights

We have determined that our mining rights meet the definition of mineral rights, as defined by accounting standards, and are tangible assets. As a result, our direct costs to acquire or lease mineral rights are initially capitalized as tangible assets. Mineral rights include costs associated with: leasing or acquiring patented and unpatented mining claims; leasing mining rights including lease signature bonuses, lease rental payments and advance minimum royalty payments; and options to purchase or lease mineral properties.

If we establish proven and probable reserves for a mineral property and establish that the mineral property can be economically developed, mineral rights will be amortized over the estimated useful life of the property following the commencement of commercial production or expensed if it is determined that the mineral property has no future economic value or if the property is sold or abandoned. For mineral rights in which proven and probable reserves have not yet been established, we assess the carrying values for impairment at the end of each reporting period and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Proven and probable reserves have not been established for any mineral rights as of March 31,September 30, 2021.

Impairment of Long-lived Assets

We continually monitor events and changes in circumstances that could indicate that our carrying amounts of long-lived assets, including mineral rights, may not be recoverable. When such events or changes in circumstances occur, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through their undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying amount of these assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets.

Exploration Costs

Mineral exploration costs are expensed as incurred. When it has been determined that it is economically feasible to extract minerals and the permitting process has been initiated, exploration costs incurred to further delineate and develop the property are considered pre-commercial production costs and will be capitalized and included as mine development costs in our consolidated balance sheets.

Share-based Payments

We measure and recognize compensation expense or professional services expense for all share-based payment awards made to employees, directors and non-employee consultants based on estimated fair values. We estimate the fair value of stock options on the date of grant using the Black-Scholes-Merton option pricing model, which includes assumptions for expected dividends, expected share price volatility, risk-free interest rate, and expected life of the options. Our expected volatility assumption is based on our historical weekly closing price of our stock over a period equivalent to the expected life of the options.

We expense share-based compensation, adjusted for estimated forfeitures, using the straight-line method over the vesting term of the award for our employees and directors and over the expected service term for our non-employee consultants. We estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from our estimates. Our excess tax benefits, if any, cannot be credited to stockholders’ equity until the deduction reduces cash taxes payable; accordingly, we realized no excess tax benefits during any of the periods presented in the accompanying consolidated financial statements.

Income Taxes

We account for income taxes through the use of the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and for income tax carry-forwards. A valuation allowance is recorded to the extent that we cannot conclude that realization of deferred tax assets is more likely than not. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.

We follow a two-step approach to recognizing and measuring tax benefits associated with uncertain tax positions taken, or expected to be taken in a tax return. The first step is to determine if, based on the technical merits, it is more likely than not that the tax position will be sustained upon examination by a taxing authority, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement with a taxing authority. We recognize interest and penalties, if any, related to uncertain tax positions in our provision for income taxes in the consolidated statements of operations. To date, we have not recognized any tax benefits from uncertain tax positions.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures:

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms, and that such information is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosures. Our management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management's control objectives.

Our management, with the participation of our CEO and CFO, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based upon this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were not effective as of such date as a result of a material weakness in our internal control over financial reporting due to lack of segregation of duties, a limited corporate governance structure and insufficient formal management review processes over certain financial and accounting reports as discussed in Item 9A of our Form 10-K for the fiscal year ended December 31, 2020.2021.

While we strive to segregate duties as much as practicable, there is an insufficient volume of transactions at this point in time to justify additional full timefull-time staff. We believe that this is typical in many exploration stage companies. We may not be able to fully remediate the material weakness until we commence mining operations at which time, we would expect to hire more staff. We will continue to monitor and assess the costs and benefits of additional staffing.

Changes in Internal Control over Financial Reporting:

There were no changes in our internal control over financial reporting that occurred during the last fiscal quarter covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

There have been no material changes from the risk factors disclosed in Part I. Item 1A. of our Annual Report on Form 10-K for the year ended December 31, 2020.2021.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

All sales of unregistered securities were reported on Form 8-K during the period.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.