8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 19, 2013

DAKOTA TERRITORY RESOURCE CORP

(Exact Name of Registrant as Specified in its Charter)

Nevada (State or other jurisdiction of incorporation or organization) Commission File Number 000-50191 98-0201259 (I.R.S. Employer Identification Number)

10580 N. McCarran Blvd., Building 115 – 208

Reno, NV 89503

(Address of Principal Executive Offices and Zip Code) 

(775) 747-0667

(Issuer's telephone number)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 . Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 . Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 . Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 . Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 5 - Corporate Governance and Management

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On March 19, 2013 the Registrant appointed Mr. Wm. Chris Mathers as Chief Financial Officer of the Company for a two year term. Mr. Mathers is 53 years old. No family relationship exists between Mr. Mathers and any director, executive officer, or person nominated or chosen by the Registrant to become a director or executive officer of the Company.

Mr. Mathers is a senior finance and accounting professional with more than 30 years of experience in financial accounting, mergers and acquisition, Securities and Exchange Commission compliance and operational and administrative support. Mr. Mathers holds a BBA in Accounting from Southwestern University at Georgetown, Texas, and is a certified public accountant. Mr. Mathers began his career in public accounting in 1981 with the accounting firm of Price Waterhouse focusing on multi-national public audits. From 1983 through 1989, Mr. Mathers was in private practice focusing on tax preparation, and the financial audits of corporations, partnerships and individuals. From 1989 through 1993, Mr. Mathers was a Controller and Administrative Officer of GJR Investments, Inc., a national real estate firm.

Beginning in 1994, Mr. Mathers began work as chief financial officer for several privately and publicly held companies, including: Intersystems, Inc. of Houston, Texas, a multi-state manufacturing firm; Nexus Custom Electronics, Inc., a manufacturer of circuit boards to private industry and the U.S. Department of Defense; ; Interactive Nutrition International, Inc., Ottawa, Canada, a manufacturer of Nutritional products; and, Texas Rare Earth Resources Corp, Texas, a mining company engaged in the business of the acquisition, exploration and development of mineral properties.

The Registrant and Mr. Mathers entered into a written contract whereby the Registrant agreed to compensate Mr. Mathers with one hundred thousand (100,000) shares of the Company’s Restricted Common Stock issued upon execution of the contract, and an option to purchase one million (1,000,000) shares of the Company’s Restricted Common Stock valued at fourteen cents ($0.14) per share, totaling one hundred and forty thousand dollars ($140,000.00). The term of the option is from March 19, 2013 until March 19, 2018. The Registrant also agreed to pay to Mr. Mathers cash consideration in the amount of $1,000 per month, increasing to $2,000 per month on September 1, 2013, and to $3,000 per month on March 1, 2014.

Section 9 - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

The following exhibits are filed herewith or incorporated herein by reference pursuant to Rule 12b-32:

Exhibit Index:

Exhibit Number

Description

EX – 10.1

Consulting Agreement

EX – 10.2

Stock Option Agreement

EX – 99.1

Press Release dated March 19, 2013

SIGNATURES

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 hereunto duly authorized.

DAKOTA TERRITORY RESOURCE CORP  (Registrant)

Date March 20, 2013

By  /s/ Richard Bachman

Richard Bachman, PRESIDENT

EX-10.1

CONSULTING AGREEMENT

This Consulting Agreement (“Agreement”) is entered into this ___ day of March, 2013 between Wm. Chris Mathers (“Consultant”) and Dakota Territory Resource Corp., a Nevada corporation (“Company”), in connection with Consultant serving as the Company’s chief financial officer, for and in consideration of the compensation described herein.

WHEREAS, the Company desires to retain Consultant to serve as Company’s chief financial officer and Consultant is willing to render and provide such service to the Company as its chief financial officer.

THEREFORE, in consideration of the mutual agreements and covenants set forth in this Agreement, and intending to be legally bound hereby, the parties agree as follows:

1.

Engagement of Consultant.  The Company hereby engages and retains Consultant to serve as its chief financial officer and to provide the type of services customarily provided by the chief financial officer to a publicly-traded company including, without limitation, preparation and filing of periodic reports with the Securities and Exchange Commission, preparing Company financial statements, budgets and projections, and coordinating with the Company’s audit firm (the “Consulting Services”), for the period commencing on the date this Agreement is executed by both parties and ending two years thereafter (the “Consulting Period”).

2.

Compensation for Consulting Services.  The Company shall pay to Consultant for the Consulting Services the following:  (i) beginning on the date of this Agreement, Consultant shall receive 100,000 restricted shares of fully-earned Company common stock; (ii) Consultant shall receive an option to purchase 1,000,000 shares of Company common stock in the form attached hereto as Exhibit A; and (iii) cash consideration in the amount of $1,000 per month, increasing to $2,000 per month on September 1, 2013, and to $3,000 per month on March 1, 2014.  Any and all reasonable expenses incurred by Consultant shall be reimbursed by Company, within fifteen (15) days after Consultant presents such expenses for payment; provided, however, that any reimbursable expense exceeding $750 will require prior written approval by the Company.

3.

Relationship.  The Company and the Consultant each acknowledge and agree that the only relationship of the Consultant to the Company created by this Agreement will for all purposes be that of an independent contractor.  Neither party to this Agreement shall represent or hold itself out to be the employer or employee of the other.  The Company will have no obligation whatsoever to pay or compensate the Consultant and/or any representative thereof for (i) taxes of any kind whatsoever that arise out of or with respect to any fee, remuneration or compensation provided to the Consultant under this Agreement; or (ii) holding any position with the Company. The Company will not provide benefits to the Consultant and/or any representative thereof relating to (i) sickness or accident, whether or not resulting from the performance by the Consultant of his obligations under this Agreement; (ii) retirement or pension benefits; or (iii) any other benefits provided by the Company or any of the affiliated companies to any of their employees.  Consultant further acknowledges that the consideration agreed to herein is a gross amount of consideration and that the Company will not withhold from such consideration any amounts as income taxes, social security payments or any other payroll taxes.  All such income taxes and other such payments shall be made or provided for by the Consultant and the Company shall have no responsibility or duties regarding such matters.  The Consultant will fully indemnify and hold harmless the Company from and against all assessments, claims, liabilities, costs, expenses and damages that the Company may suffer or incur with respect to any such taxes incurred by Consultant in connection with compensation paid hereunder or the benefits as described above.

Page 1 of 4

Consultant Agreement

4.

Confidentiality.  Consultant acknowledges that the Company will from time to time disclose to Consultant certain materials, information and data relating to the Company's business, and that the confidential information, other than what is publicly known, is confidential and proprietary information and constitutes trade secrets.  Consultant will exercise the same degree of care of the Company's confidential information that it does with its own confidential information and will restrict and confine knowledge of the Company's confidential information to those who require that knowledge for use in the ordinary course and scope of their business with the Company.  Neither the Consultant, nor any agent, servant or employee of the Consultant will make use of the Company's confidential information other than for the furtherance of the Consulting Services being carried out under this Agreement.  Consultant will not use, disclose, divulge or make available the Company’s confidential information to any third party either directly or indirectly in any manner whatsoever without the written consent of the Company.

5.

Nonexclusive Undertakings.  The Company expressly understands and agrees that Consultant shall not be prevented or barred from rendering services of the same nature as or a similar nature to those described in this Agreement, or of any nature whatsoever, for or on behalf of any person, firm, corporation, or entity other than the Company.  Company understands and accepts that Consultant is currently providing consulting services to other private and public companies and will continue to do so during the term of this Agreement.  Company also understands and accepts that Consultant will seek new clients to provide its consulting services to during the term of this Agreement.

6.

Termination of Relationship.  This Agreement shall, unless sooner terminated as provided herein below, continue until for the duration of the Consulting Period as defined in paragraph 1 herein above.  This Agreement shall terminate upon the happening of any one of the following events:

A.

Either Consultant or the Company may terminate this Agreement upon sixty (60) days written notice to the other for any or no reason.

B.

Upon a Change of Control (as defined below).  A “Change in Control” shall occur upon: (A) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not shareholders of the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the outstanding securities of each of (i) the continuing or surviving entity and (ii) any direct or indirect parent corporation of such continuing or surviving entity provided, however, that the equity financings shall not constitute a change in control under either (i) or (ii) above, even if persons who were not stockholders of the Company immediately prior to such equity financings own immediately after such equity financings 50% or more of the voting power of the company’s outstanding securities; or (B) the sale, transfer or other disposition of all or substantially all of the Company’s assets. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.

Page 2 of 4

Consultant Agreement

7.

Miscellaneous.

A.

Notices.  Any notice or other communication required or permitted by any provision of this Agreement shall be in writing and shall be deemed to have been given or served for all purposes if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid, addressed to the parties as follows:

To Consultant:

Wm. Chris Mathers

1715 Church St.

Galveston, TX  77550

To the Company:

Dakota Territory Resource Corp.

10580 North McCarran Boulevard, Building 115-208

Reno, Nevada 89503

B.

Entire Agreement.  This Agreement constitutes the entire agreement between the parties relating to the subject matter of this Agreement and supersedes all prior discussions between the parties.  There are no terms, obligations, covenants, express or implied warranties, representations, statements or conditions other than those set forth in this Agreement.  No variations or modification of this Agreement or waiver of any of its terms or provisions shall be valid unless in writing and signed by both parties.

C.

Amendment.  This Agreement shall not be modified or amended except by written agreement of the parties hereto.

D.

Governing Law and Arbitration.  Each of the provisions of this Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada. Any dispute between the parties hereto with respect to any claim for otherwise arising under this Agreement shall be resolved by binding arbitration in accordance with the following provisions, provided, however, that either party may seek injunctive relief or other equitable relief to preserve the status quo pending arbitration.  If any dispute should arise between us or under this agreement, all claims, disputes, controversies, differences or other matters in question arising out of our relationship to each other shall be resolved by binding arbitration in Las Vegas, Clark County, Nevada, in accordance with the rules for expedited, documents only proceedings of the American Arbitration Association.  This agreement to arbitrate shall be specifically enforceable only in the county of Clark, State of Nevada, and the City of Las Vegas, Nevada.

E.

Counterpart.  This Agreement may be executed in any number of counterparts, all of which shall be considered one and the same agreement.

F.

Delay; Partial Exercise.  No failure or delay by any party in exercising any right, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

G.

Severability.  Should any part of the Agreement for any reason be declared invalid or unenforceable, such decision shall not affect the validity or enforceability of any remaining portion, which remaining portion shall remain in force and effect as if this Agreement had been executed with the invalid or unenforceable portion thereof eliminated and it is hereby declared the intention of the parties hereto that they would have executed the remaining portion of this Agreement without including therein any such part, parts or portion which may, for any reason, be hereafter declared invalid or unenforceable.  Should any material term of this Agreement be in conflict any laws or regulations, the parties shall in good faith attempt to negotiate a lawful modification of this Agreement which will preserve, to the greatest extent possible, the original expectation of the parties.

Page 3 of 4

Consultant Agreement

IN WITNESS WHEREOF, the undersigned parties hereto have executed this Agreement on the dates set forth below.

DAKOTA TERRITORY RESOURCE GROUP
By: _________________________ Name: _________________________ Title: _________________________ Date: _________________________


______________________________ Wm. Chris Mathers

Page 4 of 4

Consultant Agreement

EX-10.2

Exhibit A

STOCK OPTION AGREEMENT

Dakota Territory Resources Corp., a Nevada corporation (the “Company”), desiring to afford an opportunity to the Grantee named below to purchase certain shares of the Company’s Common Stock (the “Common Stock”), to provide Grantee with an added incentive as a consultant of the Company or one or more of its subsidiaries, hereby grants to Grantee, and Grantee hereby accepts, an option (the “Option”) to purchase the number of shares of Common Stock specified below, during a term ending at midnight (prevailing local time at the Company’s principal offices) on the expiration date of this Option specified below, at the Option exercise price specified below, subject to, in all respects, to the vesting requirements set forth in Section 2 “VESTING SCHEDULE AND EXPIRATION.

1.

IDENTIFYING PROVISIONS.  As used in this Stock Option Agreement (the “Agreement” or “Option Agreement”), the following terms shall have the following respective meanings:

(1)

Grantee:  Wm. Chris Mathers, Chief Financial Officer of the Company

(2)

Effective Date of grant:   March 19, 2013

(3)

Number of shares optioned^*:  1,000,000 Restricted Common Stock

(4)

Option exercise price per share:  $0.14

(5)

Expiration date for exercising vested Options:   March 19, 2018

2.

VESTING AND EXPIRATION.  The shares of Restricted Common Stock that are the subject of this Option shall vest 1/4^th upon the date hereof, and 1/4^th upon each six month anniversary of the date hereof, provided Grantee continues to provide consulting or employment services to the Company or one or more of its subsidiaries on such applicable vesting date.  Such vesting shall accelerate upon a “Change of Control,” as defined below.  A “Change in Control” shall mean: (A) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not shareholders of the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the outstanding securities of each of (i) the continuing or surviving entity and (ii) any direct or indirect parent corporation of such continuing or surviving entity provided, however, that the equity financings shall not constitute a change in control under either (i) or (ii) above, even if persons who were not stockholders of the Company immediately prior to such equity financings own immediately after such equity financings 50% or more of the voting power of the company’s outstanding securities; or (B) the sale, transfer or other disposition of all or substantially all of the Company’s assets. A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.

If a Change of Control occurs then Grantee’s unvested options shall vest immediately.

^*Hereinafter referred to as the “Shares” or the “Option Shares”.

3.

TERMINATION PROVISIONS.  The rights associated with the vesting and exercise of this Option is subject to the following additional restrictions and limitations:

(a)

Termination of Consulting Services to the Company.  This Option shall terminate thirty days after the date of termination.  

(b)

Death of Grantee.  If the Grantee shall die while this Option remains outstanding, the Grantee’s legal representative or representatives or the persons entitled to do so under the Grantee’s last will and testament or under applicable interstate laws shall have the right to exercise this Option, but only for the number of shares as to which this Option had vested as of the date of the death of Grantee, and such rights to exercise unvested options shall expire and this Option shall terminate one year after the date of the Grantee’s death.  In all other respects, this Option shall terminate upon such death.

4.

RESTRICTIONS ON TRANSFERABILITY OF OPTION.  This Option may not be transferred by the Grantee other than by will or the laws of descent and distribution and may be exercised during the Grantee’s lifetime only by the Grantee or the Grantee’s guardian or legal representative subject to the limitations herein.

5.

ADJUSTMENTS AND CORPORATE REORGANIZATIONS.  If the outstanding shares of stock of the class then subject to this Option are increased or decreased, or are changed into or exchanged for a different number or kind of shares or securities or other forms of property (including cash) or rights, as a result of one or more reorganizations, recapitalization, spin-offs, stock splits, reverse stock splits, stock dividends or the like, appropriate adjustments shall be made in the exercise price and number of Shares.  

6.

EXERCISE, PAYMENT FOR AND DELIVERY OF STOCK.  This Option may be exercised by the Grantee or other person then entitled to exercise it by giving five (5) business days’ written notice of exercise to the Company specifying the number of shares to be purchased and the total purchase price, accompanied by a certified or cashier’s check payable to the order of the Company in payment of such price.  If the Company is required to withhold on account of any federal, state or local tax imposed as a result of such exercise, the notice of exercise shall also be accompanied by a certified or cashier’s check payable to the order of the Company in payment of the amount thus required to be withheld.

7.

RIGHTS IN STOCK BEFORE ISSUANCE AND DELIVERY.  No person shall be entitled to the privileges of stock ownership in respect of any shares issuable upon exercise of this Option, unless and until such shares have been issued to such person as fully paid shares.

8.

REQUIREMENTS OF LAW.  By accepting this Option, the Grantee represents and agrees for himself or herself and his or her transferees by will or the laws of descent and distribution that, unless a registration statement under the Securities Act of 1933 is in effect as to shares purchased upon any exercise of this Option, (a) any and all shares so purchased shall be acquired for his or her personal account and not with a view to or for sale in connection with any distribution, and (b) each notice of the exercise of any portion of this Option shall be accompanied by a representation and warranty in writing, signed by the person entitled to exercise the same, that the shares are being so acquired in good faith for his or her personal account and not with a view to or for sale in connection with any distribution. The Grantee hereby acknowledges that the shares of common stock subject to this Option have not been registered under the Securities Laws of the United States nor any individual State, and are thus “Restricted Securities.” Any share certificates issued by the Company to the Grantee pursuant to this Option will have printed on said certificate a legend that states in substantial part:

THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS A COMPLIANCE WITH THE REGISTRATION PROVISIONS OF SUCH ACT HAS BEEN MADE OR UNLESS AVAILABILITY OF AN EXEMPTION FROM SUCH REGISTRRATION PROVISIONS HAS BEEN ESTABLISHED, OR, UNELSS SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT OF 1933.

 The Grantee further acknowledges that no public market for the Restricted Option Shares exists nor is one expected to develop. Grantee cannot, without an effective registration statement being filed by the Company with the Securities and Exchange Commission, or a legal opinion acceptable to the Company regarding the existence of an exemption from registration requirements of Section 5 of the Securities and Exchange Act, clear the restriction from the Restricted Securities subject of this Option. No certificate or certificates for shares of stock purchased upon exercise of this Option shall be issued and delivered unless and until, in the written opinion of legal counsel for the Company, such securities may be issued and delivered without causing the Company to be in violation of or incur any liability under any federal, state or other securities law or any other requirement of law or of any regulatory body having jurisdiction over the Company.

9.

NOTICE.  Any notice to be given to the Company shall be addressed to the Company in care of its chief executive officer at its principal office, and any notice to be given to the Grantee shall be addressed to the Grantee at the address set forth beneath the Grantee’s signature hereto or at such other address as the Grantee may hereafter designate in writing to the Company.  Any such notice shall be deemed duly given five (5) business days after enclosed in a properly sealed envelope addressed as aforesaid, registered or certified mail, return receipt requested, and deposited, postage and registry or certification fees prepaid, in a post office or branch post office regularly maintained by the United States Postal Service.  Notice shall also be deemed given if in writing when received by the party to whom notice is intended by hand delivery, courier service, facsimile or by electronic means subject to the receipt and retention by the party giving notice of evidence of its delivery.

10.

RULES OF CONSTRUCTION.  This Agreement shall be construed and enforced in accordance with the laws of  Nevada, other than any choice of law rules calling for the application of laws of another jurisdiction.  The receipt of this Option does not give the Grantee any right to continued consulting services or employment by the Company or a subsidiary for any period, nor shall the granting of this Option or the issuance of shares on exercise thereof give the Company or any subsidiary any right to the continued services of the Grantee for any period.

IN WITNESS WHEREOF, the Company has granted this Option on the date of grant specified above.

“GRANTEE”

“COMPANY”

Dakota Territory Resource Corp.

By: _______________________________

By: _________________________________

       Wm. Chris Mathers

      _________________________

Address For Notice:

Address for Notice:

1715 Church St.

10580 N. McCarran Blvd., Bldg 115-208

Galveston, TX  77550

Reno, NV  89503

EX-99.1

Dakota Territory Resource Corp Names Wm Chris Mathers as CFO

Announces Changes to Executive Management

Reno, Nevada, March 19, 2013 -- Dakota Territory Resource Corp (OTCQB: DTRC) ("Dakota Territory" or the "Company") announced today the appointment of Wm Chris Mathers as chief financial officer of the Company.  Mr. Mathers is a strategic finance and senior accounting professional with more than 30 years financial, accounting, merger and acquisition, Securities and Exchange Commission compliance and operational and administrative support expertise across diverse middle market industries.  Mr. Mathers holds a BBA in accounting from Southwestern University at Georgetown, Texas, and is a certified public accountant.  Mr. Mathers began his career in public accounting with the international accounting firm of Price Waterhouse and has served as chief financial officer for several privately and publicly held companies. Mr. Mathers served as chief financial officer of Intersystems, Inc (Amex:II) from 1993 through1999 and most recently served as chief financial officer of Texas Rare Earth Resources Corp. (TRER:OTCQX) from November 2010 through December 2012.

"We are committed to advance our projects in the Black Hills of South Dakota this year" said Richard Bachman, president and chief executive officer of Dakota Territory. "We are building the infrastructure of Dakota Territory and our decision to strengthen our business and finance capabilities is a reflection of our dedication to fund and execute programs we believe are capable of providing for the significant growth of the Company in the near term. With his extensive public company building expertise in the mining, petrochemical and affiliated industries, Chris is a vital addition to our team and is key to the success of our efforts."

About Dakota Territory Resource Corp

Dakota Territory Resource Corp. is a Nevada Corporation with offices located at Reno, Nevada.  Dakota Territory is committed to creating shareholder value through the acquisition and responsible exploration and development of high caliber gold properties in the Black Hills of South Dakota.

In terms of total historic US gold production, the Black Hills ranks second only to the Carlin District of northeast Nevada, with the gold production of the Black Hills concentrated in a 100 square mile area known as the Homestake District.  Dakota Territory maintains 100% ownership of four mineral properties including the Blind Gold, West False Bottom/Paradise Gulch, City Creek and Homestake Paleoplacer Properties, all of which are located in the heart of the Homestake District and cover a total of approximately 2,466 acres. The Blind Gold Property is located approximately 3 miles northwest and on structural trend with the historic Homestake Gold Mine. Through its 125 year production history, the Homestake Gold Mine produced approximately 40 million ounces of gold and is the largest iron-formation-hosted gold deposit in the world.

In the 1980′s and 1990′s Homestake Mining Company undertook a $70 million exploration program managed by Richard Bachman, president and chief executive officer of Dakota Territory that was focused primarily on the search for a repeat of the Homestake Mine. This program successfully discovered significant new gold mineralization beyond the confines of the producing mine, demonstrating repeatability and the potential for additional gold deposits in the Homestake iron-formation host.  This program also proved the continuous extension of the Homestake iron-formation to a distance of approximately 3 miles from the producing mine and under the Blind Gold Property.

Dakota Territory is uniquely positioned by the experience of its management team in the Homestake District to leverage the extensive exploration efforts of the past.   For more information on Dakota Territory please visit the Company's website at http://dakotaterritoryresource.com/.

Investor Relations

Investor Relations Contact: For more information, please contact Constellation Asset Advisors, Inc. (415) 524-8500

Cautionary Note to U.S. Investors

The United States Securities and Exchange Commission (“SEC”) limits disclosure for U.S. reporting purposes to mineral deposits that a company can economically and legally extract or produce.  Our property currently does not contain any known proven or probable ore reserves under SEC reporting standards.  Our reference above to the various formations and mineralization believed to exist in our property as compared to historical results and estimates from other property in the district is illustrative only for comparative purposes and is no indication that similar results will be obtained with respect to our property.  U.S. investors are urged to consider closely the disclosure in our latest reports filed with the SEC.  You can review and obtain copies of these filings at http://www.sec.gov/edgar.shtml.

Safe Harbor Statement

This release contains forward-looking statements that are based upon current expectations or beliefs, as well as a number of assumptions about future events. Although we believe that the expectations reflected in the forward-looking statements and the assumptions upon which they are based are reasonable, we can give no assurance that such expectations and assumptions will prove to have been correct. Forward-looking statements are generally identifiable by the use of words like "may," "will," "should," "could," "expect," "anticipate," "estimate," "believe," "intend," or "project" or the negative of these words or other variations on these words or comparable terminology. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties, including but not limited to: adverse economic conditions, competition, adverse federal, state and local government regulation, inadequate capital, inability to carry out research, development and commercialization plans, loss or retirement of key executives and other specific risks. To the extent that statements in this press release are not strictly historical, including statements as to revenue projections, business strategy, outlook, objectives, future milestones, plans, intentions, goals, future financial conditions, events conditioned on stockholder or other approval, or otherwise as to future events, such statements are forward-looking, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this release are subject to certain risks and uncertainties that could cause actual results to differ materially from the statements made. Readers are advised to review our filings with the Securities and Exchange Commission that can be accessed over the Internet at the SEC's website located at http://www.sec.gov.