Austin Resources Ltd. — Management Reports 2020

Apr 28, 2020

AUSTIN RESOURCES LTD.

MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31, 2019

AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Introduction

The following management’s discussion and analysis (“MD&A”) of the financial condition and results of the operations of Austin Resources Ltd. (the “Company”, “Austin Resources”) constitutes management’s review of the factors that affected the Company’s financial and operating performance for the year ended December 31, 2019. This MD&A has been prepared in compliance with the requirements of National Instrument 51- 102 – Continuous Disclosure Obligations. This discussion should be read in conjunction with the audited annual consolidated financial statements of the Company for the years ended December 31, 2019 and 2018, together with the notes thereto. Results are reported in Canadian dollars, unless otherwise noted. In the opinion of management, all adjustments (which consist only of normal recurring adjustments) considered necessary for a fair presentation have been included. The results for the year ended December 31, 2019 are not necessarily indicative of the results that may be expected for any future period. Information contained herein is presented as at April 24, 2020, unless otherwise indicated.

The consolidated financial statements for the year ended December 31, 2019, have been prepared using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC”).

For the purposes of preparing this MD&A, management, in conjunction with the Board of Directors, considers the materiality of information. Information is considered material if: (i) such information results in, or would reasonably be expected to result in, a significant change in the market price or value of Austin Resources’ common shares; or (ii) there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision; or (iii) it would significantly alter the total mix of information available to investors. Management, in conjunction with the Board of Directors, evaluates materiality with reference to all relevant circumstances, including potential market sensitivity.

Further information about the Company and its operations is available on SEDAR at www.sedar.com.

Caution Regarding Forward-Looking Statements

This MD&A contains certain forward-looking information and forward-looking statements, as defined in applicable securities laws (collectively referred to herein as “forward-looking statements”). These statements relate to future events or the Company’s future performance. All statements other than statements of historical fact are forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “continues”, “forecasts”, “projects”, “predicts”, “intends”, “anticipates” or “believes”, or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “should”, “might” or “will be taken”, “occur” or be “achieved”. Forwardlooking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in such forward-looking statements. The forward-looking statements in this MD&A speak only as of the date of this MD&A or as of the date specified in such statement.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Forward-looking statements	Assumptions	Risk factors
For fiscal 2020, the Company’s operating expenses are estimated to be approximately $8,000 per month for recurring corporate operating costs.	The Company has anticipated all material costs; the operating activities of the Company for the twelve-month period ending December 31, 2020, and the costs associated therewith, will be consistent with Austin Resources’ current expectations.	Unforeseen costs to the Company will arise; any particular operating costs may increase or decrease from the date of the estimation; changes in economic conditions.
The Company will be required to raise additional capital in order to meet its ongoing operating expenses and complete its planned exploration activities on all of its current projects for the twelve-month period ending December 31, 2020.	The operating and exploration activities of the Company for the twelve-month period ending December 31, 2020 and the costs associated therewith, will be consistent with Austin Resources’ current expectations; debt and equity markets, exchange and interest rates and other applicable economic conditions are favourable to Austin Resources.	Changes in debt and equity markets; timing and availability of external financing on acceptable terms; increases in costs; environmental compliance and changes in environmental and other local legislation and regulation; interest rate and exchange rate fluctuations; changes in economic conditions.
Austin Resources’ properties may contain economic deposits of precious and base metals.	Financing will be available for future exploration and development of Austin Resources’ properties; the actual results of Austin Resources’ exploration and development activities will be favourable; operating, exploration and development costs will not exceed Austin Resources’ expectations; the Company will be able to retain and attract skilled staff; all requisite regulatory and governmental approvals for exploration projects and other operations will be received on a timely basis upon terms acceptable to Austin Resources, and applicable political and economic conditions are favourable to Austin Resources; the price of precious and base metals and applicable interest and exchange rates will be favourable to Austin Resources; no title disputes exist with respect to the Company’s properties.	Precious and base metal price volatility; uncertainties involved in interpreting geological data and confirming title to acquired properties; the possibility that future exploration results will not be consistent with Austin Resources’ expectations; availability of financing for and actual results of Austin Resources’ exploration and development activities; increases in costs; environmental compliance and changes in environmental and other local legislation and regulation; interest rate and exchange rate fluctuations; changes in economic and political conditions; the Company’s ability to retain and attract skilled staff.
The Company will be able to carryout anticipated business	The exploration activities of the Companyfor the twelve-month	Precious and base metal price volatility,changes in debt and

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

plans, including costs and timing for future exploration on its property interests.	period ending December 31, 2020, and the costs associated therewith, will be consistent with Austin Resources’ current expectations; debt and equity markets, exchange and interest rates and other applicable economic conditions are favourable to Austin Resources; financing will be available for Austin Resources’ exploration and development activities and the results thereof will be favourable; the Company will be able to retain and attract skilled staff; all applicable regulatory and governmental approvals for exploration projects and other operations will be received on a timely basis upon terms acceptable to Austin Resources; the Company will not be adversely affected by market competition; the price of precious and base metals will be favourable to Austin Resources; no title disputes exist with respect to Austin Resources’ properties.	equity markets; timing and availability of external financing on acceptable terms; the uncertainties involved in interpreting geological data and confirming title to acquired properties; the possibility that future exploration results will not be consistent with Austin Resources’ expectations; increases in costs; environmental compliance and changes in environmental and other local legislation and regulation; interest rate and exchange rate fluctuations; changes in economic and political conditions; the Company may be unable to retain and attract skilled staff; receipt of applicable permits.
Management’s outlook regarding future trends.	Financing will be available for Austin Resources’ exploration and operating activities; the price of precious and base metals will be favourable to Austin Resources.	Precious and base metal price volatility; changes in debt and equity markets; interest rate and exchange rate fluctuations; changes in economic and political conditions.
Sensitivity analysis of financial instruments.	Based on management's knowledge and experience of the financial markets, the Company believes that there would be no material changes to its results for the year ended December 31, 2019 as a result of a change in the foreign currency exchange rates or interest rates.	Changes in debt and equity markets; interest rate and exchange rate fluctuations.

Inherent in forward-looking statements are risks, uncertainties and other factors beyond Austin Resources’ ability to predict or control. Please also make reference to those risk factors referenced in the “Risks and Uncertainties” section below. Readers are cautioned that the above chart does not contain an exhaustive list of the factors or assumptions that may affect the forward-looking statements, and that the assumptions underlying such statements may prove to be incorrect. Actual results and developments are likely to differ,

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

and may differ materially, from those expressed or implied by the forward-looking statements contained in this MD&A.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Austin Resources’ actual results, performance or achievements to be materially different from any of its future results, performance or achievements expressed or implied by forward-looking statements. All forward-looking statements herein are qualified by this cautionary statement. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements whether as a result of new information or future events or otherwise, except as may be required by law. If the Company does update one or more forwardlooking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements, unless required by law.

Description of Business

Austin Resources Ltd. (individually, or collectively with its subsidiary, as applicable, “Austin Resources”, or the “Company”) recently completed the sale of all of its properties in Chile, and as a result of the transaction, the Company did not maintain the requirements for a TSX Venture Tier 2 company and its listing was transferred to the NEX board of the TSX Venture Exchange. While the Company currently holds no mineral properties, it retains its classification as a ‘Mineral Exploration/Development’ company.

The Company’s head office and principal address in Canada is The Canadian Venture Building, 82 Richmond St East, Suite 204, Toronto, Ontario, M5C 1P1. The Company’s common shares were listed on the TSX Venture Exchange (“TSX-V”, or the “Exchange”) under the symbol “AUT”. The Company had been advised by the Exchange that, with the closing of the transfer of all of its interests in the mineral exploration properties in Chile, the Company ceased to have active operations, no longer met the continued listing requirements of the Exchange and was transferred to the NEX. As a result of such transfer to the NEX, the Company’s trading symbol changed from AUT to AUT.H subsequent to December 31, 2019.

The Company was in the process of exploring its mineral properties and had not yet determined whether those properties contained mineral reserves that were economically recoverable. Subsequent to December 31, 2019, the Company transferred all of its interest in the mineral exploration properties in Chile held by Minera Azul Ventures Limitada ("Minera Azul"), the Company's wholly owned Chilean subsidiary.

Weimin Fu, P. Geo., a director of the Company and a Qualified Person under National Instrument 43-101, has reviewed the scientific and technical information in this document.

Trends

Management regularly monitors economic trends and financial market conditions and assesses their impact on the Company’s operations and incorporates these estimates in both short-term operating and longerterm strategic decisions. Over the last several years and up to the date of this MD&A conditions in the equity markets for the junior resource sector have been challenging. In many instances there appears to be a disconnect between operational achievements and the underlying share prices for many junior resource companies. This trend is occurring as investor interest, both retail and institutional, has been difficult to sustain notwithstanding a relatively strong performance in the underlying prices of both base and

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

precious metals since 2015. The Covid-19 pandemic has only exacerbated this market sentiment across a broad spectrum of sectors. The timing of the return to normalized global economic activity on the heels of the pandemic is the largest question facing the market today. Apart from these factors and the risk factors noted under the heading "Risks and Uncertainties", management is not aware of any other trends, commitments, events or uncertainties that would have a material effect on the Company’s business, financial condition or results of operations. See "Risks and Uncertainties" below.

Operational Highlights

On July 2, 2019, the Company received approval of its shareholders and the approval of the TSX Venture Exchange for its previously announced share consolidation ("Share Consolidation"). As a result, the common shares of the Company have been consolidated on a five for one (5:1) basis. The Share Consolidation has been retrospectively reflected in the consolidated financial statements and all references to the number of common shares herein have been revised to reflect the Share Consolidation.

On August 7, 2019, the Company completed a private placement offering ("Private Placement") of $750,000 in gross proceeds based on the issuance of 12,500,000 common shares at a price of $0.06 per common share. The common shares issued in connection with the Private Placement were subject to a resale restriction for a period of four months plus one day from August 7, 2019. The Company incurred a total issuance cost of $54,112.

On February 27, 2020, the Company transferred all of its interest in the mineral exploration properties in Chile held by Minera Azul. The Company retained 1% net smelter royalty on its interest transferred of which 50% can be acquired for US$63,166. As a result of the completion of the agreement with Bluerock Resources SPA, Minera Azul will no longer have any assets and the Company intends to wind-up operations in Chile and dispose of its interest in Minera Azul.

Additionally, the Company had been advised by the Exchange that, with the closing of the transfer of all of its interests in the mineral exploration properties in Chile, the Company ceased to have active operations, no longer met the continued listing requirements of the Exchange and was transferred to the NEX. As a result of such transfer to the NEX, the Company’s trading symbol changed from AUT to AUT.H subsequent to December 31, 2019.

Exploration and Evaluation Activities

Weimin Fu, P. Geo., a director of the Company and a Qualified Person under National Instrument 43-101, has reviewed the scientific and technical information in this document.

During the year ended December 31, 2019, the Company’s properties were on a care and maintenance basis.

In 2011, the Company’s Chilean subsidiary, Minera Azul, entered into certain option agreements, as amended, to earn 100% interests in certain mineral exploration properties located adjacent to the Atacama fault near the town of La Higuera in Chile. During 2012 and 2013, the Company renegotiated the terms of two of the option properties whereby the Company was able to satisfy all the conditions under the revised option agreements and completed the Company’s earn-in on these properties. The two properties for which

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

the Company completed its earn-in form the La Higuera Project. A summary of the two earn-in property interests is provided below.

Avril, Gloria, Withney, Caballo Cinco, Blanco Seis and Blanco

The Company earned a 100% interest in the Avril, Gloria, Withney, Caballo Cinco, Blanco Seis, and Blanco exploitation concessions and claims.

Benja I and II

The Company earned a 100% interest in the Benja I and Benja II exploitation claims.

A Net Smelter Royalty ("NSR") of 1% must be paid starting from the beginning of commercial production on these exploitation claims, on a quarterly basis. The Company may acquire the NSR by paying a purchase price of either US$500,000 ($682,100) or its equivalent in the Company’s common shares, at the election of the former owner of the property. The Company has also granted the former owner of the Benja I and II mining concessions the right to reprocess the existing slag from historical mining activity on the concessions.

On February 27, 2020, the Company received approval of its shareholders and the TSX Venture Exchange for the transfer of all of its interest in the mineral exploration properties in Chile held by Minera Azul.

Exploration and Development Costs

Names	Years Ended December 31,	Years Ended December 31,
	2019 ($)	2018 ($)
La Higuera Project
Exploration licenses and lease payments	36,528	38,102
Value added taxes	(11,101)	7,469
La Higuera Project Total	25,427	45,571

Outlook

As of December 31, 2019, the Company had net working capital deficiency of $43,568, which decreased as compared to net working capital deficiency of $555,342 as at December 31, 2018 mainly due to repayment of related party loan offset by incurring of expenses. Subsequent to December 31, 2019, the Company transferred all of its interest in the mineral exploration properties in Chile held by Minera Azul Ventures Limitada ("Minera Azul"), the Company's wholly owned Chilean subsidiary.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Off-Balance-Sheet Arrangements

As of the date of this filing, the Company does not have any off-balance-sheet arrangements that have, or are reasonably likely to have, a current or future effect on the results of operations or financial condition of the Company, including, and without limitation, such considerations as liquidity and capital resources.

Commitments and Contingencies

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

Selected Annual Financial Information

	Year ended December 31, 2019	Year ended December 31, 2018	Year ended December 31, 2017
Net loss Net lossper share(basic and diluted)	$184,311 $0.01	$202,081 $0.00	$221,437 $0.01
	As at December 31, 2019	As at December 31, 2018	As at December 31, 2017
Total assets Long-term liabilities	$86,315 $nil	$108,845 $nil	$265,473 $nil

Selected Quarterly Financial Information

As Austin Resources has no revenue, the Company ’ s ability to fund its operations is dependent upon its ability to secure financing through equity or debt issues. The value of any resource property assets is dependent upon the existence of economically recoverable mineral reserves, the ability to obtain the necessary financing to complete exploration and development, and the future profitable production or proceeds from disposition of such properties.

A summary of selected information for each of the eight most recent quarters is as follows:

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Three Months Ended	Total Revenue ($)	Loss	Loss	Total Assets($)
		Total($)	Per Share($) (1)
December 31, 2019	-	33,225	(0.00)	86,315
September 30, 2019	-	35,250	(0.00)	12,979
June 30, 2019	-	62,805	(0.01)	21,733
March 31, 2019	-	53,031	(0.00)	68,325
December 31, 2018	-	46,379	(0.00)	108,845
September 30, 2018	-	41,992	(0.00)	135,930
June 30, 2018	-	57,527	(0.00)	162,056
March 31, 2018	-	56,183	(0.00)	205,022

(1) Loss per share adjusted to reflect the consolidation of the Company’s common shares.

Discussion of Operations

Three months ended December 31, 2019 compared with three months ended December 31, 2018

Austin Resources’ net loss totaled $33,225 for the three months ended December 31, 2019, with basic and diluted loss per share of $0.00. This compares with a net loss of $46,379 with basic and diluted loss per share of $0.00 for the three months ended December 31, 2018. The decrease of $13,154 in net loss was principally because:

• For the three months ended December 31, 2019, exploration and evaluation expenditures decreased by $7,003 from $8,399 in the prior period to $1,396 in the current period. The decrease is due to less exploration work during the current period and refund of value added taxes received.

• For the three months ended December 31, 2019, interest expense decreased by $10,192 from $12,603 in the prior period to $2,411 in the current period. The decrease in due to decreased outstanding balance of the related party loan during the three months ended December 31, 2019.

• The above decreases were offset by increase of professional fees of $1,470 and increase of foreign exchange loss of $1,993 during the three months ended December 31, 2019 compared to the three months ended December 31, 2018.

Year ended December 31, 2019 compared with year ended December 31, 2018

Austin Resources’ net loss totaled $184,311 for the year ended December 31, 2019, with basic and diluted loss per share of $0.01. This compares with a net loss of $202,081 with basic and diluted loss per share of $0.02 for the year ended December 31, 2018. The decrease of $17,770 in net loss was principally because:

• For the year ended December 31, 2019, exploration and evaluation expenditures decreased by $20,144 from $45,571 in the prior year to $25,427 in the current year. The decrease is due to less exploration work during the current year and refund of value added taxes received.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

• For the year ended December 31, 2019, professional fees decreased by $7,585 from $73,424 in the prior year to $65,839 in the current year. The decrease in due to decrease of use of professional services in the Company’s subsidiary in Chile.

• For the year ended December 31, 2019, interest expense decreased by $16,904 from $50,000 in the prior year to $33,096 in the current year. The decrease in due to decreased outstanding balance of the related party loan during the year ended December 31, 2019.

Liquidity and Financial Position

Cash used in operating activities was $153,342 for the year ended December 31, 2019 compared to $157,854 in the year ended December 31, 2018. Operating activities were affected by the net loss of $184,311 offset by non-cash items of depreciation expense of $126 and accrued interest expenses of $33,096 and the negative change in non-cash working capital balances of $2,253.

At December 31, 2019, Austin Resources had $82,614 in cash and cash equivalents (December 31, 2018 - $103,492).

The Company has no operating revenues and therefore must utilize its funds obtained from the equity financing and other financing transactions to maintain its capacity to meet ongoing exploration and operating activities.

As of December 31, 2019, the Company had 21,346,618 common shares issued and outstanding. There were no warrants or stock options outstanding.

During the year ended December 31, 2019, the Company repaid the related party loan in full in the amount of $663,424 including accrued interest of $163,424 and received $100,000 from related party loan. As of December 31, 2019, the Company has a loan of $102,411. Accounts payable and accrued liabilities are short-term and non-interest bearing. During the year ended December 31, 2019, During the year ended December 31, 2019, the Company completed a private placement offering with gross proceeds of $750,000 with cost of issuance of $54,112.

The Company’s use of cash at present occurs, and in the future will occur, principally in two areas, namely, funding of its general and administrative expenditures and funding of its investment activities. Those investing activities include the cash components of the cost of acquiring and exploring tenements. For fiscal 2020, the Company’s expected operating expenses are estimated to average $8,000 per month for recurring operating costs.

As at December 31, 2019, the Company had a working capital deficit of $43,639. The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that these funds will be available on terms acceptable to the Company or at all.

Changes in Accounting Policies

During the year ended December 31, 2019, the Company adopted a number of new IFRS standards, interpretations, amendments and improvements of existing standards. These included IFRS 16 - Leases

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

and IFRIC 23 - Uncertainty Over Income Tax Treatment. These new standards and changes did not have any material impact on the Company’s consolidated financial statements.

Certain pronouncements were issued by the IASB or the IFRIC that are mandatory for accounting periods commencing on or after January 1, 2020. Many are not applicable or do not have a significant impact to the Company and have been excluded. The following has not yet been adopted and are being evaluated to determine their impact on the Company.

IAS 1 – Presentation of Financial Statements (“IAS 1”) and IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors (“IAS 8”) were amended in October 2018 to refine the definition of materiality and clarify its characteristics. The revised definition focuses on the idea that information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements. The amendments are effective for annual reporting periods beginning on or after January 1, 2020.

Capital Risk Management

The Company manages and adjusts its capital structure based on available funds in order to support the acquisition, exploration and development of its exploration and evaluation assets. The Board does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company’s management to sustain future development of the business. The capital of the Company consists of common shares, warrants and options of the Company.

The properties in which the Company currently has an interest are in the exploration and evaluation stage; as such, the Company is dependent on external financing to fund its activities. In order to carry out planned exploration and evaluation, and pay for administrative costs, the Company must raise additional amounts. The Company will continue to assess new properties and seek to acquire an interest in additional properties if it feels there is sufficient geologic or economic potential and if it has adequate financial resources to do so.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. There were no changes to the Company’s approach to capital management during the years ended December 31, 2019 and 2018.

Financial risk factors

The nature of the exploration process and the location of the Company’s assets exposed the Company to risks associated with fluctuations in commodity prices and foreign currency exchange rates. To date, the Company has not used derivative financial instruments to manage these risks.

Credit risk

Credit risk is the risk of loss associated with a counter-party’s inability to fulfil its payment obligations. The Company's credit risk is primarily attributable to cash. The Company has no significant concentration of credit risk arising from operations. Cash is held with reputable financial institutions, from which management believes the risk of loss to be minimal.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due. The Company’s liquidity and operating results may be adversely affected if the Company’s access to the capital market is hindered, whether as a result of a downturn in stock market conditions generally or related to matters specific to the Company. The Company expects to generate cash flow primarily from financing activities. As of December 31, 2019, the Company had net working capital deficiency of $43,639, which included cash balance of $82,614, amounts receivable of $2,070 and prepaid expenses and advances of $1,560, offset by accounts payable and accrued liabilities of $27,472 and related party loan of $102,411. The Company's financial liabilities generally have contractual maturities of less than 30 days and are subject to normal trade terms.

Market risk

Market risk is the risk that the fair value of, or future cash flows from, the Company’s financial instruments will fluctuate significantly due to changes in market prices. The value of the financial instruments can be affected by changes in interest rates, prices and foreign exchange rates. Management believes the risk of loss related to market risk to be remote.

Currency risk

Currency risk is the risk that the fair value of, or future cash flows from, the Company’s financial instruments will fluctuate because of changes in foreign exchange rates. The Company’s property interests in Chile make it subject to foreign currency fluctuations and inflationary pressures which may adversely affect the Company’s financial position, profit or loss and cash flows. The Company is affected by changes in exchange rates between the Canadian Dollar and foreign currencies. As at December 31, 2019, a portion of the Company’s net assets were held in Chilean Pesos (CAD$5,065). A 10% strengthening (weakening) of the Canadian Dollar against the Chilean Peso would not have a significant effect based on foreign currency balances at December 31, 2019.

Commodity price risk

The Company is exposed to price risk with respect to commodity and equity prices. Equity price risk is defined as the potential adverse impact on the Company's earnings due to movements in individual equity prices or general movements in the level of the stock market. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatilities. The Company closely monitors commodity prices, as it relates to gold, copper and iron ore, individual equity movements and the stock market to determine the appropriate course of action to be taken by the Company. Commodity price risk is remote as the Company is not a producing entity.

Fair value hierarchy

Cash and cash equivalents and amounts receivable are measured at amortized cost. Accounts payable and accrued liabilities and related party loan are are measured at amortized cost.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

IFRS 7 Financial Instruments: Disclosures requires classification of fair value measurements using a fair value hierarchy that reflects the significance of inputs used in making the measurements. The levels of the fair value hierarchy are defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the

asset or liability, either directly or indirectly; and,

Level 3: Inputs for the asset or liability that are not based on observable market data

As at December 31, 2019 and December 31, 2018, none of the Company's financial instruments were held at fair value.

Related Party Transactions

(a) Compensation of key management personnel of the Company

Key management personnel include those persons having authority and responsibility for planning, directing and controlling the activities of the Company as a whole. The Company has determined that key management personnel consists of the Board of Directors, corporate officers, including the Chief Executive Officer and Chief Financial Officer, as well the Vice President of Exploration and the Country Manager.

Names	Year Ended December 31,	Year Ended December 31,
	2019 ($)	2018 ($)
Salaries and benefits	23,830	23,365

(b) Transactions with related parties

The Chief Financial Officer is an employee of Marrelli Support Services Inc. ("MSSI"), a firm providing accounting services. During the year ended December 31, 2019, the Company incurred $26,511 (year ended December 31, 2018 - $25,674) for accounting services (included in professional fees) rendered by MSSI. As at December 31, 2019, MSSI was owed $1,792 (December 31, 2018 - $7,785) and this amount was included in accounts payable and accrued liabilities. The amount is unsecured, non-interest bearing and due on demand.

Share Capital

As of the date of this Interim MD&A, the Company had 21,346,618 issued and outstanding common shares.

Disclosure of Internal Controls

Management has established processes to provide them sufficient knowledge to support representations that they have exercised reasonable diligence that (i) the consolidated financial statements do not contain any untrue statement of material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it is made, as of the date of and for the periods presented by consolidated financial statements; and (ii) the consolidated financial

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

statements fairly present in all material respects the financial condition, results of operations and cash flows of the Company, as of the date of and for the periods presented.

In contrast to the certificate required for non-venture issuers under National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (“NI 52-109”), this Venture Issuer Basic Certificate does not include representations relating to the establishment and maintenance of disclosure controls and procedures (“DC&P”) and internal control over financial reporting (“ICFR”), as defined in NI 52-109. In particular, the certifying officers filing this certificate are not making any representations relating to the establishment and maintenance of:

• i) controls and other procedures designed to provide reasonable assurance that information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

• ii) a process to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP (IFRS).

The issuer’s certifying officers are responsible for ensuring that processes are in place to provide them with sufficient knowledge to support the representations they are making in this certificate. Investors should be aware that inherent limitations on the ability of certifying officers of a venture issuer to design and implement on a cost effective basis DC&P and ICFR as defined in NI 52-109 may result in additional risks to the quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

Risks and Uncertainties

The Company is subject to a number of risks due to the nature of its business, which is classified as a “Mineral Exploration/Development” company. These risk factors, although not exhaustive, could materially affect the Company ’ s future operating results and could cause actual events to differ materially from those – described in forward looking information relating to the Company.

Liquidity Concerns and Future Financings

The Company will require significant funding in connection with the identification and evaluation of business opportunities and its ongoing operational expenses. There can be no assurance that the Company will be successful in obtaining required financing as and when needed. Volatile markets may make it difficult or impossible for the Company to obtain debt financing or equity financing on favourable terms, if at all. Failure to obtain additional financing on a timely basis may cause the Company to postpone or slow down the identification and evaluation of business opportunities or reduce or terminate some or all of its activities.

Dilution Risk

In order to finance future operations and development efforts, the Company may raise funds through the issue of common shares or securities convertible into common shares. The constating documents of the Company allow it to issue, among other things, an unlimited number of common shares for such consideration and on such terms and conditions as may be established by the directors of the Company,

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

in many cases, without the approval of shareholders. The size of future issues of commons shares or securities convertible into common shares or the effect, if any, that future issues and sales of the common shares will have on the price of the common shares cannot be predicted at this time. Any transaction involving the issue of previously authorized but unissued common shares or securities convertible into common shares would result in dilution, possibly substantial, to present and prospective shareholders of the Company.

No Revenues

The Company has not historically recorded any revenues from its activities. The Company ’ s operating expenses may increase in subsequent years in relation to the engagement of consultants and personnel associated with the identification and evaluation of business opportunities. The Company expects to continue to incur losses for the foreseeable future. There can be no assurance that the Company will generate any revenues or achieve profitability from any business opportunity identified or evaluated.

Competition

The Company competes with many other companies that have substantially greater resources than the Company. Such competition may result in the Company being unable to identify and evaluate desired business opportunities, recruit or retain qualified employees or acquire the capital necessary to fund its operations and act upon any identified business opportunity. The Company ’ s inability to compete with other companies for these resources would have a material adverse effect on the Company ’ s results of operation and business.

Conflicts of Interest

Certain of the Company ’ s directors and officers serve or may agree to serve as directors or officers of other companies and, to the extent that such other companies may participate in ventures in which the Company may participate, the directors of the Company may have a conflict of interest in negotiating and concluding terms respecting such participation.

Dividends

To date, the Company has not paid any dividends on its outstanding securities and does not expect to do so in the foreseeable future. Any decision to pay dividends on the common shares will be made by the board of directors on the basis of the Company ’ s earnings, financial requirements and other conditions.

Litigation

The Company has entered into legally binding agreements with various third parties on a consulting basis. The interpretation of the rights and obligations that arise from such agreements is open to interpretation and the Company may disagree with the position taken by the various other parties resulting in a dispute that could potentially initiate litigation and cause the Company to incur legal costs in the future. Given the speculative and unpredictable nature of litigation, the outcome of any such disputes could have a material adverse effect on the Company.

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AUSTIN RESOURCES LTD. Management’s Discussion & Analysis Year Ended December 31, 2019 Dated April 24, 2020

Additional Disclosure for Venture Issuers without Significant Revenue

General and Administrative

Names	Year Ended December 31,	Year Ended December 31,
	2019 ($)	2018 ($)
Consulting and management fees	23,830	23,365
Professional fees	65,839	73,424
Office expense	591	7,107
Interest expense	33,096	50,000
Shareholder communication and filing fees	19,808	8,258
Bank charges	3,828	4,242
Depreciation expense	126	126
Total	147,118	166,522

Subsequent event

Novel Coronavirus (“COVID-19”)

The Company’s operations could be significantly adversely affected by the effects of a widespread global outbreak of a contagious disease, including the recent outbreak of respiratory illness caused by COVID-19. The Company cannot accurately predict the impact COVID-19 will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could further affect the Company’s operations and ability to finance its operations.

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