Aztec Minerals Corp.

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Second Quarter Report

Management Discussion and Analysis

(expressed in Canadian dollars)

Three and Six Months ended June 30, 2021

AZTEC MINERALS CORP.

(the “ Company ”)

Second Quarter Report

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

CAUTION – FORWARD LOOKING STATEMENTS

Certain statements contained herein regarding the Company and its operations constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, assumptions or expectations of future performance, are “forward-looking statements”. We caution you that such “forward looking statements” involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Such risks and uncertainties include fluctuations in precious metal prices, unpredictable results of exploration activities, uncertainties inherent in the estimation of mineral reserves and resources, if any, fluctuations in the costs of goods and services, problems associated with exploration and mining operations, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors, as discussed in the Company’s filings with Canadian and American Securities regulatory agencies. The Company expressly disclaims any obligation to update any forward-looking statements, other than as may be specifically required by applicable securities laws and regulations.

1.0 Preliminary Information

The following Management’s Discussion and Analysis (“MD&A”) of Aztec Minerals Corp. (the “Company”) should be read in conjunction with the accompanying unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2021 and audited consolidated statements of financial position as at December 31, 2020 and 2019 and the consolidated statements of comprehensive loss, changes in shareholders’ equity and cash flows for the years ended December 31, 2020 and 2019, and a summary of significant accounting policies and other explanatory information, all of which are available at the SEDAR website at www.sedar.com.

Financial information in this MD&A is prepared in accordance with International Accounting Standards 34 Interim Financial Reporting based upon the principles of International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), and all dollar amounts are expressed in Canadian dollars unless otherwise indicated.

All information contained in the MD&A is as of August 30, 2021 unless otherwise indicated.

David Heyl, BSc, PGeo, Vice President (Exploration), or Bradford Cooke, PGeo, a Director of the Company, is the Qualified Person who reviewed and approved any technical information in this MD&A for 2021. Joseph Wilkins, BSc (Geology), PG, advisor and formerly Vice President (Exploration) and Chief Geologist of the Company, was the Qualified Person who reviewed and approved any technical information in this MD&A for 2020.

1.1 Background

The Company was incorporated on July 6, 2007 under the laws of British Columbia, Canada, pursuant to the Business Corporations Act (British Columbia) and had been dormant until 2016. The Company is engaged primarily in the business of evaluating, acquiring and exploring natural resource properties.

The Company acquires properties by staking initial claims, negotiating for permits from government authorities, negotiating with holders of claims or permits, entering into property option agreements to acquire interests in claims, or purchasing companies with claims or permits. On these properties, the Company explores for minerals on its own or in joint ventures with others. Exploration for metals usually includes surface sampling, airborne and/or ground geophysical surveys and drilling. The Company is not limited to any particular metal or region, but the corporate focus is on precious and base metals in North America.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

As the Company is focused on its mineral exploration activities, there is no mineral production, sales or inventory in the conventional sense. The recoverability of amounts capitalized for mineral property interests is dependent upon the existence of reserves in its mineral property interests; the ability of the Company to arrange appropriate financing and receive necessary permitting for the exploration and development of its property interests; confirmation of the Company’s interest in certain properties; and upon future profitable production or proceeds from the disposition thereof. Such exploration and development activities normally take years to complete and the amount of resulting income, if any, is difficult to determine with any certainty at this time. Many of the key factors are outside of the Company’s control. As the carrying value and amortization of mineral property interests and capital assets are, in part, related to the Company’s mineral reserves and resources, if any, the estimation of such reserves and resources is significant to the Company’s financial position and results of operations.

1.2 Overall Performance

Option Amendment and Assignment Agreement with Aztec Metals Corp.

On September 30, 2016, the Company entered into the Option Amendment and Assignment Agreement for the Cervantes Property (“Option Assignment Agreement”) for the Cervantes property with Aztec Metals Corp., which share common directors with the Company, (“AzMet”) and Kootenay Silver Inc. (“Kootenay”), whereby AzMet assigned to the Company all of its rights and interests in the Property Option Agreement dated July 25, 2015 between AzMet and Kootenay (the “Cervantes Option Agreement”).

In July 2019, the Company earned its 65% interest in the Cervantes property whereby the Company issued 500,000 common shares to Kootenay; paid US$50,000 in cash; and incurred exploration expenditures totalling US$1.2 million. The Company entered into a joint venture agreement with Kootenay in December 2020.

In June 2020, the Company finalized interpretation of a 3-dimensional IP-resistivity survey completed in 2019, identifying multiple chargeability anomalies over a 5 kilometer (km) long corridor stretching from Purisima West through Purisima East and across the Estrella target, linking up with the Jasper target. Chargeability anomalies in general reflect more conductive areas within rock formations and these chargeability anomalies are interpreted to reflect buried sulfide (potentially gold and copper bearing) mineralization typical of porphyry-type mineralization. The 3-D IP survey ties in with the previous 2-D IP survey completed in 2016 over the main California zone and confirms that the previously mapped and sampled porphyry corridor extends at least 5 km long and up to 2 km wide from the California zone southwest to the Purisima West target. Each of the 6 porphyry prospects along the corridor exhibit strong high level porphyry alteration and gold (copper) mineralization within and adjacent to outcropping quartz-feldspar porphyry intrusions and diatreme breccias.

In late February 2021, the Company mobilized a field crew to conduct a soil and outcrop rock chip surface sampling program which outlined new gold-copper-molybdenum geochemical soil and rock anomalies on the Cervantes porphyry gold-copper property in Sonora, Mexico. The soil sample grid covered 518 hectares (5.18 square kilometers) with 477 samples in a 100 by 100 meter spacing, to extend its coverage over the Estrella, California, Brazil and California North targets to the western, northern, and eastern limits of the property. The outcrop rock chip sampling comprised 110 samples making the current project total 340, plus previous to 2021 the Company collected 608 channel samples and 23 stream sediment samples.

Highlights of the exploration program are as follows:

Rock chip sampling returned assays up to 21.3 grams per tonne (gpt) gold, with ten samples running over 1 gpt Au, with anomalous results of 20-250 ppb Au occurring proximal to the strongest rock gold values.
Soil sampling returned assays up to 3.60 gpt Au, with anomalous results of 10-70 ppb Au occurring proximal to the strongest soil gold values.

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

Further details of the drilling program for the Cervantes project are provided in the Company’s news releases:

News Release dated June 10, 2020 and titled, “ Aztec Highlights Top Priority Targets on the Cervantes Porphyry GoldCopper Project in Sonora, Mexico” .
News Release dated June 25, 2020 and titled, “ Aztec Minerals IP-Resistivity Geophysical Survey Identifies Multiple Anomalies Over a 5 Km Long Porphyry Corridor at Cervantes Project in Sonora, Mexico” .
News Release dated February 23, 2021 and titled, “ Aztec Minerals – Kootenay Silver Joint Venture Commences 2021 Exploration Program on the Cervantes Porphyry Gold-Copper Property in Sonora, Mexico” .
News Release dated August 4, 2021 and titled, “ Aztec – Kootenay JV Outlines New Gold-Copper-Molybdenum Geochemical Soil and Rock Anomalies on the Cervantes Porphyry Gold-Copper Property in Sonora, Mexico” .

Purchase Option Agreement with Baroyeca Gold & Silver Inc.

On November 30, 2017, as amended on February 28, 2018, the Company entered into a Purchase Option Agreement for the Tombstone property (the “Tombstone Option Agreement”) with Baroyeca Gold & Silver Inc. and its two wholly owned U.S. subsidiaries (collectively, “Baroyeca”). The Company can earn a 75% interest by making cash payments of $100,000, incurring exploration expenditures of $1 million and issuing 1 million common shares over a three year period starting from March 23, 2018. In February 2021, the Company earned its 75% interest and entered into a joint venture for the Tombstone property.

The Tombstone property includes the historic Contention Mine and surrounding patented claims totalling 404 acres (163.5 hectares) with an additional 24 acres (9.7 hectares) of unpatented claims. The Tombstone Mining District, located 65 miles southeast of Tucson, Arizona, and accessed by State Highway 80, is well known for its high grade, oxidized, carbonate replacement deposits of silver-gold-lead mineralization hosted in veins, mantos, pipes and disseminated orebodies.

In March 2020, an NSAMT (natural source audio-frequency magneto-tellurics) geophysical survey was completed over the property to map resistivity and conductivity contrasts in the subsurface sedimentary rocks. Data inversion and interpretation of NSAMT geophysical survey (natural-source audio-frequency magneto-telluric) has identified strong conductive bodies underlying the Company’s Tombstone silver-gold-copper-lead-zinc property in southeastern Arizona. Such conductive bodies can be related to buried sulfide mineralization such as CRD polymetallic high-grade massive sulphide drilled by Santa Fe Mining in 1989. The 4-line, 7.1 km AMT geophysical survey data was put through an inversion model and interpreted into 4 horizontal depth slices ( depth slices ) at 1,200 m, 1,000 m, 800 m, and 600 m elevations above sea level (asl).

In August 2020, Phase 1 reverse circulation drilling commenced on the Tombstone property and completed by the end of November 2020. The drilling program consisted of 21 drill holes totalling 2,993 metres. The drilling program attempted to verify the historic results by twinning some of the drill holes as well as drilling new targets. The main target of the RC drill program was to test for shallow, bulk tonnage, heap leachable, epithermal gold-silver oxide mineralization adjacent and below the previously mined Contention pit. The Company also staked 15 unpatented claims and closed its 100% purchase of the Alps and Minnett patented contiguous claim group, bringing the overall total land package at Tombstone to 1,004.7 acres.

In March 2021, the Company acquired two patented claims amounting to 15.2 hectares (37.5 acres), increasing the overall Tombstone joint venture land package to 434.4 hectares (1,073.4 acres). In April 2021, the Company mobilized a 20 hole, 10,000 foot reverse circulation drill program at Tombstone. The RC program is designed to step out and down from the Phase 1 drill patterns drilled in 2020 to expand the shallow, broad, bulk tonnage gold-silver mineralization discovered around and below the Contention pit. The drilled holes have intersected near surface, oxidized gold-silver mineralization.

Drill results from the first 10 holes are as follows:

Drill Hole	From m	To m	Interval m*	Au gpt	Ag gpt	Au Eq gpt (1)	Comments
TR21-01	68.6	71.64	3.04	0.188	4.1	0.247

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

104 Az, -50	82.32	109.76	27.44	0.177	24.938	0.533	Two tunnels at 330
							and 355 ft
TR21-02	96.04	123.48	27.44	0.589	17.989	0.846
104 Az, -60

TR21-03	18.29	21.34	3.05	0.271	2.25	0.303
104 Az, -45	57.93	60.98	3.05	1.41	0.4	1.415
	80.79	112.8	32.01	5.713	40.543	6.282
	incl.
	89.94	105.18	15.24	11.891	62.86	12.788

	120.43	125	4.57	0.159	5	0.23
	129.57	132.62	3.05	0.272	14.9	0.485

TR21-04	56.4	60.98	4.57	0.799	9.533	0.935
104 Az, -60	68.6	89.94	21.34	1.193	37.064	1.723
	103.05	123.48	20.43	0.105	21.008	0.405	One Tunnel at 338
							to 350 ft
TR21-05	47.26	68.59	21.34	2.071	26.064	2.444
104 Az, -60

1. AuEq is calculated using a 70:1 silver:gold ratio

* All interval widths are not true widths and intercept true widths are not yet estimated.

Drill Hole	From m	To m	Interval m*	Au gpt	Ag gpt	Au Eq gpt (1)	Comments
TR21-06	7.62	12.2	4.57	0.765	38.5	1.315
104 Az, -65	62.5	65.55	3.05	0.866	2.15	0.896
	83.32	157.01	73.69	0.220	17.3	0.468	True width approx. 72- 83%
Including:	83.32	92.99	9.67	0.641	14.1	0.584
	123.48	157.01	33.53	0.202	23.9	0.544

TR21-07	1.52	6.1	4.58	0.776	34.6	1.272
104 Az, -45	57.93	59.45	1.52	1.404	3.1	1.448
	67.07	74.69	7.62	0.303	1.4	0.323
	88.41	112.8	24.39	0.491	23.1	0.821	True width approx. 94%
							Tunnel 91.46 m - 96.04 m
TR21-08	53.35	92.9	39.64	2.085	47.1	2.758	True width approx. 72- 100%

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

104 Az, -90

TR21-09	44.21	51.83	7.62	0.173	9.2	0.305
284 Az, -80	68.6	73.17	4.57	1.160	12.93	1.345
	82.32	108.23	25.91	0.452	16.9	0.694	True width approx. 55- 89%
Including:	82.32	86.89	4.57	0.701	33.8	1.184
	92.99	99.08	6.09	1.049	24.35	1.397
	103.66	108.23	4.57	0.35	21.6	0.658

TR21-10	0	4.57	4.57	0.192	4.2	0.252
104 Az, -45	25.91	121.95	96.04	1.39	56.4	2.196	True width approx. 83- 89%
Including:	25.91	65.55	39.44	2.472	28.9	2.967	Tunnels at 74.69 m-
	77.74	97.56	19.82	0.955	24.98	1.312	77.74 m, & 86.89 m -
	111.28	121.95	10.67	0.837	60.96	1.708	91.46 m

1. AuEq is calculated using a 70:1 silver:gold ratio

All interval widths are not true widths and intercept true widths are not yet estimated.

Subject to results from the current RC drill program, a 3 hole, 2,400 m diamond drill is planned in the latter part of 2021.

Further details of the exploration program for the Tombstone project are provided in the Company’s news releases:

News Release dated June 4, 2020 and titled, “Aztec Focuses on Drilling the Tombstone Silver District in 2020”.
News Release dated June 6, 2020 and titled, “Aztec Minerals’ NSAMT Geophysical Survey Identifies Strong Buried Conductive Bodies at Tombstone Project, Arizona”.
News Release dated August 13, 2020 and titled, “Aztec Commences Phase 1 Drill Program on the Tombstone Property, Tombstone Silver Mining District, Arizona”.
News Release dated September 29, 2020 and titled, “Aztec Receives Initial RC Drill Results from Tombstone Project, Arizona Including 0.94 gpt Gold and 42.1 gpt Silver (1.60 gpt AuEq) over 77.7m”.
News Release dated October 21, 2020 and titled, “Aztec Drilling Intersects 6.18 gpt Gold & 77.2 gpt Silver (7.15 gpt AuEq) over 15.14 m in Hole TR20-09 at Tombstone Project, Arizona”.
News Release dated November 30, 2020 and titled, “Aztec Reports Additional Six Drill Holes from Tombstone Project, Arizona Including 1.01 gpt Gold Equivalent over 48.8 m”.
News Release dated December 22, 2020 and titled, “Aztec Reports Final Phase 1 Drill Results for Tombstone Project in Southeastern Arizona, Intersects 6.36 gpt Gold Equivalent over 7.62 m and 0.62 gpt Gold Equivalent over 140.21m”.
News Release dated January 12, 2021 and titled, “Aztec Reviews Geological Highlights of Phase 1 RC Drill Program from Tombstone Project, Arizona”.
News Release dated March 4, 2021 and titled, “Aztec and Tombstone Partners Plan Two Phase, CAD$1.5 Million Exploration Program in 2021 at Tombstone Project, Arizona”.
News Release dated July 7, 2021 and titled, “Aztec Receives Initial 2021 RC Drill Results from Tombstone Project, Arizona; Intersects Broad and High-Grade Gold-Silver Mineralized Zones; Including 5.71 gpt Gold and 40.5 gpt Silver (6.282 gpt AuEq) over 32.01 m”.
News Release dated July 27, 2021 and titled, “Aztec Drilling Intersects Broad, High-Grade Gold-Silver Mineralized Zones at the Tombstone Project, Arizona; Including 1.39 gpt Gold and 56.40 gpt Silver (2.196 gpt AuEq) over 96.04 m”.

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Aztec Minerals Corp.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

David Heyl, BSc, CPG, Vice President (Exploration), is the Qualified Person who reviewed and approved any technical information in this MD&A for 2021.

Other Matters

In March 2021, Mr. Joseph Wilkins resigned as Vice President (Exploration) and Chief Geologist, and became adviser. Mr. Allen David Heyl was appointed Vice-President (Exploration) in April 2021.

1.3 Selected Annual Information

The consolidated financial statements have been prepared in accordance with IFRS as issued by the IASB.

Total revenues Loss before discontinued operations and extraordinary items: (i) Total (ii) Basic per share (iii) Diluted per share Net loss: (i) Total (ii) Basic per share (iii) Diluted per share Total assets Total long-term liabilities Dividends per share	Years Ended December 31,
	2020 2019 2018
	- $ - $ - $ (1,623,760) $ (556,881) $ (1,019,383) $ (0.04) $ (0.02) $ (0.04) $ (0.04) $ (0.02) $ (0.04) $ (1,623,760) $ (556,881) $ (1,019,383) $ (0.04) $ (0.02) $ (0.04) $ (0.04) $ (0.02) $ (0.04) $ 6,110,829 $ 3,045,797 $ 3,018,409 $ - $ - $ - $ - $ - $ - $

1.4 Results of Operations

Second Quarter of Fiscal 2021 – Six months ended June 30, 2021 compared with June 30, 2020

The Company incurred a net loss of $719,000 for the six months ended June 30, 2021, which is higher than the net loss of $384,100 for same period in fiscal 2020, with the former also having higher operating expenses. Net loss was impacted by different functional expense items.

The Company has no sources of operating revenues. Operating losses were incurred for activities of the Company to acquire, explore or maintain its mineral property interests in the Cervantes and Tombstone properties and pursuing mineral projects of merit.

The Company continues with its engagement of an external Mexican accounting firm to assist in financial reporting and tax compliance and representation in Mexico and to provide accounting support in which such fees were incurred, given the Cervantes project in located in Mexico and held by its Mexican subsidiary. Higher accruals for audit and tax compliance fees were recorded in the fourth quarter of 2020 given the corporate structure used to support the joint venture with Kootenay. Accounting fees were lower in the first quarter of 2021 due to allocations to the Cervantes joint venture. Part time accounting

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Aztec Minerals Corp.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

contractor was hired in the second quarter of 2021 to support the heightened exploration activities for its two mineral properties which are subject to joint ventures.

Amortization is attributable to office furniture and equipment for its shared office facilities. Amortization was lower in the first quarter of 2021 as certain office equipment have been fully amortized in 2020 although there were acquisitions in the first quarter which resulted in slightly higher amortization in the second quarter of 2021.

Employee remuneration directly related to mineral exploration projects and corporate development were allocated to those specific activities rather than to operations. In August 2020, a non technical senior officer was hired with capital markets experience which increased remuneration in the remaining quarters of 2020 and into 2021. In the second quarter of 2021, increases in employee remuneration were attributable to bonuses paid, executive recruiter fees incurred for seeking a new senior officer, and interim fees charged by a technical director to act as a qualified person to review and approve technical exploration results.

In the first quarter of 2020, modifications to exercise prices of stock options necessitated regulatory filings and approvals which increased legal fees. For the third quarter of 2020, such expenses were incurred for its corporate compliance for stock option grants and engagement of investor relation consultants. Nominal fees were incurred in the fourth quarter of 2020. Legal services rendered in the first two quarters of 2021 relate to annual corporate filings and updates in domestic and foreign jurisdictions and regulatory filings and were minimal.

Office and sundry include ancillary office support facilities for the Company’s activities, and include insurance, office rent, telecommunications and software and systems support and licensing. Insurance increased due to high insurance payouts in the insurance industry resulting in higher premium renewal rates for directors and officers and commercial liability insurance coverages. Office and sundry and rent are generally more fixed than other functional expense categories. Office and sundry increased to support the active exploration programs in 2021. Rent increased due to office facility for a new senior officer who was hired in August 2020. The use of shared office facilities has allowed rent and commitments to be nominal. In mid 2020, the Company proceeded with the setup and migration of a new cloud server to support a more comprehensive and secure IT infrastructure including the associated software licensing costs. In 2021, additional security and backup features and user access controls were implemented as well as additional users, resulting in higher costs relative to prior quarters in 2020.

Project evaluation efforts involve due diligence on identifying mineral properties of merit for acquisition purposes. These costs are attributable to geological technical management review and due diligence, site visits to mineral properties in North America, reviewing technical information, addressing any legal issues associated with due diligence, and engaging consultants to provide greater capital markets exposures. Only nominal travel expenses were incurred in the first quarter of 2020 given limited cash and the economic downturn from the pandemic in the latter part of the quarter. This cost is comprised mostly of technical management review and travel. In the second quarter of 2020, the Company engaged a consultant to provide corporate development activities and to develop strategies and guidance to management to advance current projects and identify new opportunities, which continued into the third quarter. This provided the catalyst for the $3.08 million private placement which was overallotted and closed in two tranches in the third quarter in 2020. No project review was done in the first quarter of 2021 as the primary focus was the exploration programs for its two mineral properties, and nominal travel expenses were incurred in the second quarter for project review.

Regulatory expenses include ongoing regulatory compliance obligations and transfer agent services and tend to be similar for comparable periods. The increases in the second quarters of each fiscal period were attributable to its annual and special general meetings held in June. The expenses for the first quarter of 2021 were higher than the same quarter of 2020 due to the higher market capitalization which resulted in higher sustaining fees and annual filing fees, and also due to fees for its continuous disclosures related to more active exploration programs in 2021. Second quarter fees in 2021 were higher from higher annual general meeting fees.

Shareholder relations were for advertising and marketing activities, engagement of consultant, and participation in conferences to create awareness of the Company and its Cervantes and Tombstone projects. These activities included the participation in various conferences and shareholder events in North America and Europe related to mineral exploration and mining as well as capital markets, and engaging market participants to assist with expanding the public profile of the Company and its projects.

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

Such expenses were incurred in the first quarter of 2020 for attendance at conferences to continue with its capital market exposure as the Company proceeded with an equity financing in March 2020. These activities increased in the second quarter of 2020 with more significant increases in the remaining quarters of 2020 as the Company sought greater exposure of its exploration projects as commodity prices achieved new highs. Such efforts contributed to an overallotment of its $3.08 million financing which was closed in two tranches in July 2020. Given two active joint ventures and active exploration programs for its mineral properties for 2021, the Company continued its advertising and marketing efforts in 2021 which resulted in higher costs than the prior comparable quarters in 2020.

Share-based payments were recognized for the vesting provisions for stock options. No stock options were granted in the first and second quarters of 2020. In August 2020, the Company granted stock options for 1,930,000 common shares with an exercise price of $0.40 and expiry date of August 7, 2025. The stock options are subject to vesting provisions in which 20% vest on grant date and 20% vest every 6 months thereafter. The combination of the stock volatility and number of stock options subject to vesting provisions along with the effects from the re-pricing of the exercise prices contributed to the increase in 2020. In April 2021, the Company granted stock options for 1,015,000 common shares with an exercise price of $0.30 and expiry date of April 12, 2026. The stock options are subject to vesting provisions in which 20% vest on grant date and 20% vest every 6 months thereafter. The stock option grant would increase share based payments in the second quarter of 2021 relative to prior quarters.

Interest income is realized from the Company’s excess cash which is held in interest bearing investment savings account. As cash is expended on working capital needs and exploration programs, quarterly interest will commensurately decrease. The Company did not have any cash in interest bearing account in the first two quarters of 2020 whereas proceeds from the $3.08 million financing in July 2020 were invested to earn passive income from its premium savings account.

Finance and interest charges in the second and third quarters of 2020 are interest on such loans which bore interest at 12% per annum. The loans were repaid in July 2020.

The foreign exchange gain (loss) was from the net effects of transactional foreign currency and jurisdictional translation and revaluation effects from its Mexican and US subsidiaries which operate in Mexican pesos and US dollars, respectively, and from certain U.S. dollar stated accounts during the period. The Company’s functional currency is the CAD dollars. The US dollars appreciated relative to the Canadian dollar and Mexican peso during the first quarter of 2020 resulting is higher foreign exchange losses, from US dollar transactions and its US subsidiaries. The US dollar and Mexican peso depreciated relative to the Canadian dollar during the remaining periods of 2020 in which the Canadian dollar continued to strengthen in 2021.

In the fourth quarter of 2020, the Company wrote down a portion of its value added tax receivable in Mexico as there are uncertainties related to its collectability and / or refundability. Also such write-downs are indicative of the added costs of engaging dedicated Mexican tax specialists to assist with their collectability.

Non controlling interest represents the allocation of operating expenses of the joint venture to the joint venture partner.

As at June 30, 2021, the Company’s mineral property interests are comprised of the following:

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

Acquisition Costs: Balance, December 31, 2020 Acquisition	June 30, 2021
	Mexico USA Cervantes Tombstone Total 582,611 $ 176,073 $ 758,684 $ - 303,722 303,722
Balance, June 30, 2021	582,611 479,795 1,062,406
Deferred Exploration Expenditures: Balance, December 31, 2020 Assays Drilling Equipment and systems Field, camp, supplies General, administrative, legal, sundry Geology Salaries and local labour Surface taxes Surveying Transportation and travel Contribution by joint venturepartner	2,218,539 999,312 3,217,851 22,782 52,554 75,336 - 163,210 163,210 256 1,509 1,765 1,557 7,906 9,463 50,383 16,818 67,201 54,910 22,059 76,969 20,383 68,913 89,296 4,816 - 4,816 1,254 - 1,254 9,219 34,494 43,713 - (190,279) (190,279)
Balance, June 30, 2021	2,384,099 1,176,496 3,560,595
Mineral Property Interests: December 31, 2020 June 30, 2021	2,801,150 $ 1,175,385 $ 3,976,535 $ 2,966,710 $ 1,656,291 $ 4,623,001 $

In the first quarter of 2021, the Company mobilized a field crew to conduct a soil and outcrop rock chip surface sampling program which outlined new gold-copper-molybdenum geochemical soil and rock anomalies on the Cervantes porphyry goldcopper property in Sonora, Mexico.

During the six months ended June 30, 2021, funds of US$62,500 were received for the Cervantes project and US$153,500 for the Tombstone project from the respective joint venture partners.

1.5 Summary of Quarterly Results (Unaudited)

The following table provides selected financial information of the Company for each of the last eight quarters ended at the most recently completed quarter, June 30, 2021. All dollar amounts are expressed in Canadian dollars unless otherwise indicated.

Aztec Minerals Corp.

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AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

Total revenues Income (loss) before discontinued operations and extraordinary items: (i) Total (ii) Basic earnings (loss) per share (iii) Diluted earnings (loss) per share Net income (loss): (i) Total (ii) Basic earnings (loss) per share (iii) Diluted earnings (loss) per share Total assets Total long-term liabilities Dividends per share	20	21		20	20		20	19
	June 30 - $ (456,957) $ (0.01) $ (0.01) $ (456,957) $ (0.01) $ (0.01) $ 6,483,066 $ - $ - $	Mar31	Dec 31	Sept 30	June 30	Mar31 - $ (114,968) $ - $ - $ (114,968) $ - $ - $ 3,512,611 $ - $ - $	Dec 31	Sept 30
		- $ (262,074) $ - $ - $ (262,074) $ - $ - $ 6,248,454 $ - $ - $	- $ (591,764) $ (0.01) $ (0.01) $ (591,764) $ (0.01) $ (0.01) $ 6,110,829 $ - $ - $	- $ (647,885) $ (0.01) $ (0.01) $ (647,885) $ (0.01) $ (0.01) $ 6,293,503 $ - $ - $	- $ (269,143) $ (0.01) $ (0.01) $ (269,143) $ (0.01) $ (0.01) $ 3,835,012 $ - $ - $		- $ (149,166) $ (0.01) $ (0.01) $ (149,166) $ (0.01) $ (0.01) $ 3,045,797 $ - $ - $	- $ (103,284) $ - $ - $ (103,284) $ - $ - $ 3,125,235 $ - $ - $

In the third quarter of 2020, the Company implemented programs for marketing its minerals exploration projects which contributed to the closing of $3.08 million financing.

1.6 Liquidity

The Company is in the exploration stage and has not yet determined whether its mineral property interests contain reserves. The recoverability of amounts capitalized for mineral property interests is entirely dependent upon the existence of reserves, the ability of the Company to obtain the necessary financing to complete the development and upon future profitable production. The Company knows of no trends, demands, commitments, events or uncertainties that may result in the Company’s liquidity either materially increasing or decreasing at the present time or in the foreseeable future except as disclosed in this MD&A and in its regulatory filings. Material increases or decreases in the Company’s liquidity are substantially determined by the success or failure of the Company’s exploration and development programs and overall market conditions for smaller mineral exploration companies. The Company has endeavored to secure mineral property interests that in due course could be brought into production to provide the Company with cash flow which would be used to undertake work programs on other projects. To that end, the Company has expended its funds on mineral property interests that it believes have the potential to achieve cash flow within a reasonable time frame. As a result, the Company has incurred losses during each of its fiscal years. This result is typical of smaller exploration companies and will continue unless positive cash flow is achieved.

The following table contains selected financial information of the Company’s liquidity:

Cash Working capital	June 30, December 31, 2021 2020 1,519,493 $ 1,919,485 $ 1,645,712 1,983,302

Aztec Minerals Corp.

Page 10

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

During the six months ended June 30 ,2021, warrants for 2.58 million common shares were exercised for gross proceeds of $506,000 and stock options for 160,000 common shares were exercised for gross proceeds of $19,200. In July 2021, warrants for 600,000 common shares were exercised for proceeds of $120,000.

During the six months ended June 30, 2021, funds of US$62,500 were received for the Cervantes project and US$153,500 for the Tombstone project from the respective joint venture partners.

Ongoing operating expenses and exploration activities continue to reduce the Company’s cash resources and working capital, as the Company has no sources of operating revenues.

The Company may enter into option agreements for mineral properties that involve payments in the form of cash and/or shares of the Company as well as minimum exploration expenditure requirements. Under Item 1.7, further details of contractual obligations are provided as at June 30, 2021. The Company will continue to rely upon equity financing as its principal source of financing its projects.

1.7 Capital Resources

At June 30, 2021, the Company has earned in various interests in its minerals properties which are subject to joint venture agreements.

1.8 Off-Balance Sheet Arrangements

There are no off balance sheet arrangements which could have a material effect on current or future results of operations, or the financial condition of the Company, except for those disclosed in this MD&A or in the Company’s public filings.

1.9 Transactions with Related Parties

Key management includes directors (executive and non-executive) and senior management. The compensation paid or payable to key management is disclosed in the table below.

Except as disclosed elsewhere in the MD&A, the Company had the following general and administrative costs with related parties during the six months ended June 30, 2021:

Aztec Minerals Corp.

Page 11

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

	Six months ended June 30, 2021	Net balance receivable (payable) June 30, 2021
Key management compensation: Executive salaries and remuneration(1) Directors fees Share-based payments Executive salaries and remuneration(1) Net office, sundry, rent and salary allocations recovered from (incurred to) company(ies) sharing certain common director(s)(2)	209,580 $ 11,958 203,873 425,411 $ (8,927) $	- $ (2,820) -
		(2,820) $
		(4,173) $

(1) Includes key management compensation which is included in mineral property interests, employee remuneration, and project evaluation.

(2) The companies are AzMet and Canagold Resources Ltd. and Endeavour Silver Corp., both of which shares one common director with the Company.

Amounts which are incurred to related parties are in the normal course of business. The Company shares common office facilities, employee and administrative support, and office sundry amongst companies with a common director, and such allocations to the Company are on a full cost recovery basis. Any balances due to related parties are payable on demand.

Item 1.2 provides further details of the acquisition of the Cervantes property from AzMet.

1.10 Proposed Transactions

There are no proposed material asset or business acquisitions or dispositions, other than those in the ordinary course of business and other than those already disclosed in this MD&A, before the board of directors for consideration, and other than those already disclosed in its regulatory and public filings.

1.11 Critical Accounting Estimates and Judgements

The preparation of financial statements in accordance with IFRS requires management to make estimates, assumptions and judgements that affect the application of accounting policies and the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements along with the reported amounts of revenues and expenses during the period. Actual results may differ from these estimates and, as such, estimates and judgements and underlying assumptions are reviewed on an ongoing basis. Revisions are recognized in the period in which the estimates are revised and in any future periods affected.

Significant areas requiring the use of management estimates relate to determining the recoverability of mineral property interests; the determination of accrued liabilities; accrued site remediation; the variables used in the determination of the fair value of stock options granted and compensation warrants or finder’s fees warrants issued or modified; and the recoverability of deferred tax assets. While management believes the estimates are reasonable, actual results could differ from those estimates and could impact future financial performance and cash flows.

Aztec Minerals Corp.

Page 12

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

1.12 Changes in Accounting Policies including Initial Adoption

The Company did not early adopt any recent pronouncements as disclosed in Note 2(f), “ New accounting standards and recent pronouncements”, of the audited consolidated financial statements for the years ended December 31, 2020 and 2019.

1.13 Financial Instruments and Other Instruments

The Company classifies its financial instruments as follows:

Financial Assets Cash Fair value through profit or loss (“FVTPL”) Receivables Loans and receivable at amortized cost Financial Liability Accounts payable and accrued liabilities Other financial liabilities under amortized cost

Management of Financial Risk

The Company is exposed in varying degrees to a variety of financial instrument related risks, including credit risk, liquidity risk, and market risk which includes foreign currency risk, interest rate risk and other price risk. The types of risk exposure and the way in which such exposure is managed are provided as follows.

The fair value hierarchy categorizes financial instruments measured at fair value at one of three levels according to the reliability of the inputs used to estimate fair values. The fair values of assets and liabilities included in Level 1 are determined by reference to quoted prices in active markets for identical assets and liabilities. Assets and liabilities in Level 2 are valued using inputs other than quoted prices for which all significant inputs are based on observable market data. Level 3 valuations are based on inputs that are not based on observable market data.

The fair values of the Company’s receivables and accounts payable and accrued liabilities and loans payable approximate their carrying values due to the short terms to maturity. Cash is measured at fair values using Level 1 inputs.

(a) Credit risk:

Credit risk is the risk of potential loss to the Company if the counterparty to a financial instrument fails to meet its contractual obligations. The Company's credit risk is primarily attributable to its liquid financial assets including cash. The Company limits exposure to credit risk on liquid financial assets through maintaining its cash with high-credit quality Canadian financial institutions. Management has reviewed the items comprising the accounts receivable balance which may include amounts receivable from certain related parties, and determined that all accounts are collectible.

(b) Liquidity risk:

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company ensures that there is sufficient capital in order to meet short-term business requirements, after taking into account the Company's holdings of cash and its ability to raise equity financings. As at June 30, 2021, the Company had working capital of $1.65 million. The Company will require additional funding to meet its short-term liabilities and administrative overhead costs, and to maintain its mineral property interests in 2021.

Accounts payable and accrued liabilities are due in less than 90 days.

Aztec Minerals Corp.

Page 13

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021

AZTEC MINERALS CORP.

(An Exploration Stage Company)

(expressed in Canadian dollars)

(c) Market risk:

The significant market risk to which the Company is exposed are foreign currency risk, interest rate risk and other price risk.

(i) Foreign currency risk:

The Company has certain cash and accounts payable stated in United States dollars and Mexican pesos, mineral property interests which are in the USA and Mexico, and a portion of its operations is in Mexico, resulting in expenditures subject to foreign currency fluctuations. Fluctuations in the United States dollar and Mexican peso would impact the losses of the Company and the values of its assets and liabilities as the Company’s functional and presentation currencies are the Canadian dollar. The Canadian dollar fluctuates and floats with the United States dollar and Mexican peso.

At June 30, 2021, the Company was exposed to currency risk for its Canadian dollar equivalent of financial assets and liabilities denominated in currencies other than Canadian dollars as follows:

Stated in Canadian Dollars	Stated in Canadian Dollars	Stated in Canadian Dollars
Held in		Total 591,649 $ (57,940)
United States Dollars 585,826 $ (53,793)	Mexican Pesos 5,823 $ (4,147)
532,033 $	1,676 $	533,709 $

Based upon the above net exposure as at June 30, 2021 and assuming all other variables remain constant, a 10% depreciation or appreciation of the Canadian dollar relative to the United States dollar and Mexican pesos could result in a decrease/increase of approximately $53,000 in the Company’s net losses. The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time.

(ii) Interest rate risk:

In respect of financial assets, the Company's policy is to invest excess cash at floating rates of interest in cash equivalents, in order to maintain liquidity, while achieving a satisfactory return. Fluctuations in interest rates impact on the value of cash equivalents. Interest rate risk is not significant to the Company as it has no cash equivalents at period-end.

(iii) Other price risk:

Other price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices. The Company currently does not have any financial instruments which fluctuate with market prices.

1.14 Other MD&A Requirements

Aztec Minerals Corp.

Page 14

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

1.14.1 Other MD&A Requirements

Additional information relating to the Company are as follows:

(a) may be found on SEDAR at www.sedar.com;
(b) is also provided in the Company’s unaudited condensed consolidated interim financial statements for the three months and six months ended June 30, 2021 and audited consolidated financial statements for the years ended December 31, 2020 and 2019.

1.14.2 Outstanding Share Data

The Company’s authorized share capital consists of unlimited number of common shares without par value.

Changes in the Company’s share capital for the six months ended June 30, 2021 are as follows:

	Number of Shares		Amount
Balance at December 31, 2020	55,771,113	$	9,388,293
Issued:
Share issue expenses	-		(3,487)
Property acquisition	600,000		201,000
Exercise of warrants	2,580,000		571,400
Exercise of stock options	160,000		29,530
Balance at June 30, 2021	59,111,113	$	10,186,736

At August 30, 2021, there were 59,711,113 common shares issued and outstanding.

The Company has a stock option plan that allows it to grant stock options to its directors, officers, employees and consultants, provided that the aggregate number of stock options granted shall not at any time exceed 10% of the total number of issued and outstanding common shares of the Company. The exercise price of each stock option shall be based on the market price of the Company’s shares as traded on the TSX Venture Exchange at the time of grant. Stock options have a maximum term of ten years and terminate 30 days following the termination of the optionee’s employment, except in the case of death, in which case they terminate one year after the event. Vesting of stock options is made at the discretion of the Board at the time the stock options are granted.

The continuity of stock options for the six months ended June 30, 2021 is as follows:

Page 15

Aztec Minerals Corp.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

Outstanding balance, beginning of period Granted Exercised Outstanding balance, end of period	June 30, 2021
	Number Weighted average of shares exerciseprice
	4,830,000 $0.23 1,015,000 $0.30 (160,000) $0.12 5,685,000 $0.24

On April 12, 2021, the Company granted stock options for 1,015,000 common shares to directors, officers and employees with an exercise price of $0.30 and expiry date of April 12, 2026. The stock options are subject to vesting provisions in which 20% vest on grant date and 20% vest every 6 months thereafter.

At August 30, 2021, stock options for 5,685,000 common shares remain outstanding of which 4,101,000 stock options are exercisable.

At June 30, 2021, the Company had outstanding warrants as follows:

Exercise		Outstanding at						Outstanding at
Prices	ExpiryDates	December 31,2020	Issued		Exercised	Expired		June 30,2021
$0.20	July 2, 2021(1)	3,000,000		-	(2,180,000)		-	820,000
$0.20	June 3, 2021	300,000		-	(300,000)		-	-
$0.10	April 3, 2022	2,600,000		-	(100,000)		-	2,500,000
$0.40	July 9, 2022	3,538,082		-	-		-	3,538,082
$0.40	July 9, 2022(2)	212,040		-	-		-	212,040
$0.40	July 22, 2022	1,591,342		-	-		-	1,591,342
$0.40	July 22, 2022(3)	89,837		-	-		-	89,837
		11,331,301		-	(2,580,000)		-	8,751,301

(1) On July 2, 2019, the Company issued 3,900,000 warrants with an exercise price of $0.20 and an expiry date of July 2, 2021, and have a total fair value of $117,000 as determined by the excess private placement price over the market price of the common share on closing date.

(2) These finders fee warrants have a fair value of $50,767 and was recorded as share issuance expense as applied to share capital with a corresponding credit to reserve for share-based payments calculated using the BlackScholes option pricing model with the following assumptions: volatility 129%, risk-free rate 0.28%, expected life 2 years, and expected dividend yield 0%.

(3) These finders fee warrants have a fair value of $22,962 and was recorded as share issuance expense as applied to share capital with a corresponding credit to reserve for share-based payments calculated using the BlackScholes option pricing model with the following assumptions: volatility 129%, risk-free rate 0.27%, expected life 2 years, and expected dividend yield 0%.

At August 30, 2021, warrants for 7,931,301 common shares remain outstanding.

Page 16

Aztec Minerals Corp.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

1.15 Outlook

The Company will continue to depend upon equity financings to continue exploration work on and to advance its mineral property interests, and to meet its administrative overhead costs for the 2021 fiscal year. There are no assurances that capital requirements will be met by this means of financing as inherent risks are attached therein including commodity prices, financial market conditions, and general economic factors. The Company does not expect to realize any operating revenues from its mineral property interests in the foreseeable future.

1.16 Risk Factors

The following is a brief discussion of those distinctive or special characteristics of the Company’s operations and industry that may have a material impact on, or constitute risk factors in respect of, the Company’s future financial performance.

Exploration and Development Risks

There is no assurance given by the Company that its exploration and development, if any, programs and properties will result in the discovery, development or production of a commercially viable deposit or ore body.

The business of exploration for minerals and mining involves a high degree of risk. Few properties that are explored are ultimately developed into producing mines. There is no assurance that the Company’s mineral exploration activities will result in any discoveries of bodies of commercial ore. The economics of developing mineral properties are affected by many factors including capital and operating costs, variations of the grades and tonnages of ore mined, fluctuating metal prices, costs of mining and processing equipment and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection. Substantial expenditures are required to establish resources or reserves through drilling and other work, to develop metallurgical processes to extract metal from ore, and to develop the mining and processing facilities and infrastructure at any site chosen for mining. No assurance can be given that funds required for exploration and / or development can be obtained on a timely basis. The marketability of any metals or minerals acquired or discovered may be affected by numerous factors which are beyond the Company’s control and which cannot be accurately foreseen or predicted, such as market fluctuations, the global marketing conditions for precious and base metals, the proximity and capacity of required processing facilities, mineral markets and required processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting minerals and environmental protection. In order to commence exploitation of certain properties presently held under exploration concessions, it is necessary for the Company to apply for exploitation concessions. There can be no guarantee that such concessions will be granted.

Financing Risks

There is no assurance given by the Company that it will be able to secure the financing necessary to explore, develop and produce its mineral properties.

The Company does not presently have sufficient financial resources or operating cash-flow to undertake by itself all of its planned exploration and development programs. The development of the Company’s properties may therefore depend on the Company’s ability to obtain additional required financing. There is no assurance the Company will be successful in obtaining the required financing on terms acceptable to the Company, or at all, the lack of which could result in the loss or substantial dilution of its interests (as existing or as proposed to be acquired) in its properties as disclosed herein. The Company’s ability to continue as a going concern is dependent on the ability of the Company to raise equity capital financings, exploration success, the attainment of profitable operations and the completion of further share issuances to satisfy working capital and operating needs. The Company may need to raise further funds to complete further exploration programs at the Cervantes and Tombstone properties, if such programs are warranted.

Estimates of Mineral Deposits

Aztec Minerals Corp.

Page 17

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

There is no assurance given by the Company that any estimates of mineral deposits or resources will materialize.

No assurance can be given that any identified mineralization will be developed into a coherent mineralization deposit, or that such deposit will even qualify as a commercially viable and mineable ore body that can be legally and economically exploited. Estimates regarding mineralized deposits can also be affected by many factors such as permitting regulations and requirements, weather, environmental factors, unforeseen technical difficulties, unusual or unexpected geological formations and work interruptions. In addition, the grades and tonnages of ore ultimately mined may differ from that indicated by drilling results and other exploration and development work. There can be no assurance that test work and results conducted and recovered in small-scale laboratory tests will be duplicated in large-scale tests under on-site conditions. Material changes in mineralized tonnages, grades, dilution and stripping ratios or recovery rates may affect the economic viability of projects. The existence of mineralization or mineralized deposits should not be interpreted as assurances of the future delineation of ore reserves or the profitability of any future operations.

Commodity Prices

There is no assurance given by the Company that commodity prices will not change.

The mining industry is competitive and commodity prices fluctuate so that there is no assurance, even if commercial quantities of a mineral resource are discovered, that a profitable market will exist for the sale of same. Factors beyond the control of the Company may affect the marketability of any substances discovered. The prices of precious and base metals fluctuate on a daily basis, have experienced volatile and significant price movements over short periods of time, and are affected by numerous factors beyond the control of the Company, including international economic and political trends, expectations of inflation, currency exchange fluctuations (specifically, the U.S. dollar relative to other currencies), interest rates, central bank transactions, world supply for precious and base metals, international investments, monetary systems, and global or regional consumption patterns (such as the development of gold coin programs), speculative activities and increased production due to improved mining and production methods. The supply of and demand for precious and base metals are affected by various factors, including political events, economic conditions and production costs in major producing regions, and governmental policies with respect to precious metal holdings by a nation or its citizens. The exact effect of these factors cannot be accurately predicted, and the combination of these factors may result in the Company not receiving adequate returns on invested capital or the investments retaining their respective values. There is no assurance that the prices of gold and other precious and base metals will be such that the Company’s properties can be mined at a profit.

Competition and Agreements with Other Parties

The Company competes with larger, better capitalized competitors in the mining industry and there is no assurance given by the Company that it can compete for mineral properties, future financings or technical expertise.

The mining industry is intensely competitive in all of its phases, and the Company competes with many companies possessing greater financial resources and technical facilities than itself. Competition in the mining business could adversely affect the Company’s ability to acquire suitable producing properties or prospects for mineral exploration in the future.

The Company may, in the future, be unable to meet its share of costs incurred under joint venture or similar agreements to which it is a party and the Company may have its interest in the properties subject to such agreements reduced as a result. Furthermore, if other parties to such agreements do not meet their share of such costs, the Company may be unable to finance the cost required to complete recommended programs.

Title Matters

There is no assurance given by the Company that it owns legal title to its mineral properties.

The acquisition of title to mineral properties is a very detailed and time-consuming process. Title to any of the Company’s mining concessions may come under dispute. While the Company has diligently investigated title considerations to its mineral

Aztec Minerals Corp.

Page 18

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

properties, in certain circumstances, the Company has only relied upon representations of property partners, legal opinions, and government agencies. There is no guarantee of title to any of the Company’s properties. The properties may be subject to prior unregistered agreements or transfers, and title may be affected by unidentified and undetected defects. Native land claims or claims of aboriginal title may be asserted over areas in which the Company’s properties are located, but unlikely given all surrounding surface rights are privately held. Further, the Company does not own certain claims in the Cervantes and Tombstone properties and only has a right to earn an interest therein pursuant to the property option agreements, as amended. In the event that the Company does not fulfill its obligations contemplated by the property option agreements, as amended, it will lose its interest in the relevant mineral property.

Surface Rights

The Company has acquired rights to certain parts of the property covered by its mineral tenures, and is in continuing negotiations over other parts. In areas where the Company operates there are local populations or landowners who, in the case of the Cervantes Property, do not live on the property but raise cattle throughout the region. The Company understands that it is necessary, as a practical matter, to negotiate surface access, and the Company is continuing to do so. However, there is a risk that local communities or affected groups may take actions to delay, impede or otherwise terminate the contemplated activities of the Company. There can be no guarantee that the Company will be able to negotiate a satisfactory agreement with any such existing landowners/occupiers for such access, and therefore it may be unable to carry out significant exploration and development activities. In addition, in circumstances where such access is denied, or no agreement can be reached, the Company may need to rely on the assistance of local officials or the courts in such jurisdiction, which assistance may not be provided or, if provided, may not be effective. If the development of a mine on the Cervantes Property becomes justifiable it will be necessary to acquire surface rights for mining, plant, tailings and mine waste disposal. There can be no assurance that the Company will be successful in acquiring any such rights.

Community Groups

There is an ongoing level of public concern relating to the effects of mining on the natural landscape, on communities and on the environment. Certain non-governmental organizations, public interest groups and reporting organizations (“NGOs”) who oppose resource development can be vocal critics of the mining industry. In addition, there have been many instances in which local community groups have opposed resource extraction activities, which have resulted in disruption and delays to the relevant operation. While the Company seeks to operate in a socially responsible manner and believes it has good relationships with local communities in Sonora State (Mexico) and Arizona (USA), NGOs or local community organizations could direct adverse publicity and/or disrupt the operations of the Company in respect of one or more of its properties due to political factors, activities of unrelated third parties on lands in which the Company has an interest or the Company’s operations specifically. Any such actions and the resulting media coverage could have an adverse effect on the reputation and financial condition of the Company or its relationships with the communities in which it operates, which could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

Conflicts of Interest

There is no assurance given by the Company that its directors and officers will not have conflicts of interest from time to time.

The Company’s directors and officers may serve as directors or officers of other public mineral exploration and resource companies or have significant shareholdings in other public resource companies and, to the extent that such other companies may participate in ventures in which the Company may participate, the directors and management of the Company may have a conflict of interest in negotiating and concluding terms respecting the extent of such participation. The interests of these companies may differ from time to time. In the event that such a conflict of interest arises at a meeting of the Company’s directors, a director who has such a conflict will abstain from voting for or against any resolution involving any such conflict. From time to time several companies may participate in the acquisition, exploration and development of natural resource properties thereby allowing for their participation in larger programs, permitting involvement in a greater number of programs and reducing financial exposure in respect of any one program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another of these companies due to the financial position of the company making the assignment. In accordance with the laws of the Province of British Columbia, Canada, the directors of the Company

Aztec Minerals Corp.

Page 19

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

are required to act honestly, in good faith and in the best interests of the Company. In determining whether or not the Company will participate in any particular exploration or mining project at any given time, the directors will primarily consider the upside potential for the project to be accretive to shareholders, the degree of risk to which the Company may be exposed and its financial position at that time.

Negative Operating Cash Flow

The Company had negative operating cash flow during its most recently completed year ended December 31, 2020. In the event that the Company’s operating cash flow is not positive in future financial periods it may need to raise additional capital in order to fund operations. There is no guarantee that additional funds will be available on terms acceptable to the Company or at all. In the event that the Company’s operating cash flow is negative this may have a material adverse effect on the Company and its stock price.

Uninsured Risks

There is no assurance given by the Company that it is adequately insured against all risks. The Company may become subject to liability for cave-ins, pollution or other hazards against which it cannot insure or against which it has elected not to insure because of high premium costs or other reasons. The payment of such liabilities would reduce the funds available for exploration, development and mining activities.

Environmental and Other Regulatory Requirements

There is no assurance given by the Company that it has met all environmental or regulatory requirements.

The current or future operations of the Company, including exploration and development activities and commencement of production on its properties, require permits from various foreign, federal, state and local governmental authorities and such operations are and will be governed by laws and regulations governing prospecting, development, mining, production, exports, taxes, labour standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in the development and operation of mines and related facilities generally experience increased costs, and delays in production and other schedules as a result of the need to comply with applicable laws, regulations and permits. There can be no assurance that approvals and permits required in order for the Company to commence exploration, development or production on its various properties will be obtained. Additional permits and studies, which may include environmental impact studies conducted before permits can be obtained, are necessary prior to operation of the other properties in which the Company has interests and there can be no assurance that the Company will be able to obtain or maintain all necessary permits that may be required to commence exploration, construction, development or operation of mining facilities at these properties on terms which enable operations to be conducted at economically justifiable costs.

Failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in exploration, development and mining operations may be required to compensate those suffering loss or damage by reason of such activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations. New laws or regulations or amendments to current laws, regulations and permits governing operations and activities of exploration and mining companies, or more stringent implementation of current laws, regulations or permits, could have a material adverse impact on the Company and cause increases in capital expenditures or production costs or reduction in levels of production at producing properties or require abandonment or delays in development of new mining properties.

Foreign Countries and Regulatory Requirements

The Company’s mineral property interests are located in countries outside of Canada, and mineral exploration and mining activities may be affected in varying degrees by political stability, changes in foreign policy, and government regulations relating to the mining industry. Any changes in regulations, foreign policy, or shifts in political attitudes may vary from country to country and are beyond the control of the Company and may adversely affect its business and its ability to operate in foreign

Aztec Minerals Corp.

Page 20

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

jurisdictions. Such changes have, in the past, included nationalization of foreign owned businesses and properties. The Company’s ability to operate its business may be affected in varying degrees by government regulations with respect to, but not limited to, restrictions on production, price controls, export controls, income and other taxes and duties, tariffs, trade, expropriation of property, environmental legislation and mine safety. These uncertainties may make it more difficult for the Company to obtain any required production financing for its mineral properties.

Reclamation

Land reclamation requirements for the Company’s properties may be burdensome.

There is a risk that monies allotted for land reclamation may not be sufficient to cover all risks, due to changes in the nature of any potential waste rock and/or tailings and/or revisions to government regulations. Therefore additional funds, or reclamation bonds or other forms of financial assurance may be required over the tenure of the Company’s properties to cover potential risks. These additional costs may have material adverse impact on the financial condition and results of the Company.

Unknown Environmental Risks for Past Activities

Exploration and mining operations involve a potential risk of releases to soil, surface water and groundwater of metals, chemicals, fuels, liquids having acidic properties and other contaminants. In recent years, regulatory requirements and improved technology have significantly reduced those risks. However, those risks have not been eliminated, and the risk of environmental contamination from present and past exploration or mining activities exists for mining companies. Companies may be liable for environmental contamination and natural resource damages relating to properties that they currently own or operate or at which environmental contamination occurred while or before they owned or operated the properties. However, no assurance can be given that potential liabilities for such contamination or damages caused by past activities at these properties do not exist.

Currency Fluctuation and Foreign Exchange Controls

The Company maintains a portion of its funds in U.S. dollar and Mexican pesos denominated accounts. Certain of the Company’s property and related contracts may be denominated in U.S. dollars and Mexican pesos. The Company’s operations in countries other than Canada are normally carried out in the currency of that country and make the Company subject to foreign currency fluctuations and such fluctuations may materially affect the Company’s financial position and results. In addition future contracts may not be denominated in Canadian dollars and may expose the Company to foreign currency fluctuations and such fluctuations may materially affect the Company’s financial position and results. The Company is or may become subject to foreign exchange restrictions which may severely limit or restrict its ability to repatriate capital or profits from its properties outside of Canada to Canada. Future impositions of such restrictions could have a materially adverse effect on the Company’s future profitability or ability to pay dividends.

Dependence on Key Individuals

The Company is dependent on a relatively small number of key personnel, the loss of any one of whom could have an adverse effect on the Company.

The Company does not maintain key-person insurance on the life of any of its personnel. In addition, while certain of the Company’s officers and directors have experience in the exploration of mineral producing properties, the Company will remain highly dependent upon contractors and third parties in the performance of its exploration and development activities. There can be no guarantee that such contractors and third parties will be available to carry out such activities on behalf of the Company or be available upon commercially acceptable terms.

Volatility of Common Shares

Volatility in the price of the Company’s common shares could cause investor loss.

Aztec Minerals Corp.

Page 21

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis For the Three and Six Months ended June 30, 2021 (expressed in Canadian dollars)

The common shares are listed on the TSX Venture Exchange and OTCQB. The market price of a publicly traded stock, especially a junior resource company like the Company, is affected by many variables in addition to those directly related to exploration successes or failures. Such factors include the general condition of the market for junior resource stocks, the strength of the economy generally, the availability and attractiveness of alternative investments, and the breadth of the public market for the stock. The effect of these and other factors on the market price of the common shares on the TSX Venture Exchange and OTCQB suggests that the price of the Company’s common shares will continue to be volatile. Therefore, investors could suffer significant losses if the Company’s common shares are depressed or illiquid when an investor seeks liquidity and needs to sell the common shares of the Company. There is no guarantee on the future price at which the common shares may trade, and no guarantee that the warrants will ever be in a position of value and may ultimately expire prior to being in-the-money.

Substantial Number of Authorized but Unissued Shares

The Company has an unlimited number of common shares which may be issued by the Board without further action or approval of the Company’s shareholders. While the Board is required to fulfil its fiduciary obligations in connection with the issuance of such shares, the shares may be issued in transactions with which not all shareholders agree, and the issuance of such shares will cause dilution to the ownership interests of the Company’s shareholders.

COVID-19 Pandemic

The COVID-19 (the novel coronavirus) pandemic is having a material adverse effect on the global economy as well as caused volatility in the global financial markets. While the full impact of COVID-19 on the Company and the global economy is uncertain, rapid spread of COVID-19 may have an adverse effect on the Company's planned operations and financing capabilities; If a significant portion of our workforce becomes unable to work or travel to our operations due to illness or state or federal government restrictions (including travel restrictions and “shelter-in-place” and similar orders), we may be forced to delay, reduce or suspend planned exploration programs. Illnesses or government restrictions, including the closure of national borders, related to COVID-19 also may disrupt the supply of raw goods, equipment, supplies and services upon which our operations rely. An economic recession resulting from the COVID-19 pandemic could negatively impact the Company’s ability to operate or obtain necessary financing. The extent to which COVID-19 may impact the Company’s business will depend on future developments such as the geographic spread of the disease, the duration of the outbreak, vaccination rates, travel restrictions and social distancing, business closures or business disruptions, and the effectiveness of actions taken in Canada, the United States and other countries to contain and treat the disease. These conditions may require working capital not previously anticipated, which may adversely affect our liquidity and ability to source additional working capital on reasonable terms. Although it is not possible to reliably estimate the length or severity of these developments and their financial impact to the date of approval of these unaudited condensed consolidated interim financial statements, the Company's stock price did fall to a low of CAD$0.03 during this period. Should the stock prices remain at or below currently prevailing levels for an extended period, this could have a further significant adverse impact on the Company's financial position and results of operations for future periods. To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section.

Cybersecurity Threats

The Company relies on secure and adequate operations of information technology systems in the conduct of its operations. Access to and security of the information technology systems are critical to the Company’s operations. To the Company’s knowledge, it has not experienced any material losses relating to disruptions to its information technology systems. The Company has implemented ongoing policies, controls and practices to manage and safeguard the Company and its stakeholders from internal and external cybersecurity threats and to comply with changing legal requirements and industry practice. Given that cyber risks cannot be fully mitigated and the evolving nature of these threats, the Company cannot assure that its information technology systems are fully protected from cybercrime or that the systems will not be inadvertently compromised, or without failures or defects. Potential disruptions to the Company’s information technology systems, including, without limitation, security breaches, power loss, theft, computer viruses, cyber-attacks, natural disasters, and noncompliance by third party service providers and inadequate levels of cybersecurity expertise and safeguards of third party information technology service providers, may adversely affect the operations of the Company as well as present significant costs and risks including,

Aztec Minerals Corp.

Page 22

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

For the Three and Six Months ended June 30, 2021

(expressed in Canadian dollars)

without limitation, loss or disclosure of confidential, proprietary, personal or sensitive information and third party data, material adverse effect on its financial performance, compliance with its contractual obligations, compliance with applicable laws, damaged reputation, remediation costs, potential litigation, regulatory enforcement proceedings and heightened regulatory scrutiny.

Possible Dilution to Current Shareholders based on Outstanding Options and Warrants

At June 30, 2021, the Company has 59,111,113 common shares, 5,685,000 stock options and 8,751,301 warrants outstanding. The resale of outstanding shares from the exercise of dilutive securities could have a depressing effect on the market for the Company’s shares. At June 30, 2021, dilutive securities represented approximately 24.4% of the Company’s issued shares.

Aztec Minerals Corp.

Page 23

AI assistant

Aztec Minerals Corp. — Interim / Quarterly Report 2021

47382_rns_2021-08-30_f82ecaf7-3a97-4335-9bf4-fe952f3834e9.pdf

AZTEC MINERALS CORP.

Second Quarter Report

CAUTION – FORWARD LOOKING STATEMENTS

1.0 Preliminary Information

1.1 Background

AZTEC MINERALS CORP.

1.2 Overall Performance

Option Amendment and Assignment Agreement with Aztec Metals Corp.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Purchase Option Agreement with Baroyeca Gold & Silver Inc.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

(expressed in Canadian dollars)

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

AZTEC MINERALS CORP.

Other Matters

1.3 Selected Annual Information

1.4 Results of Operations

Second Quarter of Fiscal 2021 – Six months ended June 30, 2021 compared with June 30, 2020

AZTEC MINERALS CORP.

AZTEC MINERALS CORP.

(An Exploration Stage Company)

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

(expressed in Canadian dollars)

1.5 Summary of Quarterly Results (Unaudited)

AZTEC MINERALS CORP.

1.6 Liquidity

AZTEC MINERALS CORP.

1.7 Capital Resources

1.8 Off-Balance Sheet Arrangements

1.9 Transactions with Related Parties

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

(expressed in Canadian dollars)

1.10 Proposed Transactions

1.11 Critical Accounting Estimates and Judgements

AZTEC MINERALS CORP.

(An Exploration Stage Company)

1.12 Changes in Accounting Policies including Initial Adoption

1.13 Financial Instruments and Other Instruments

Management of Financial Risk

(a) Credit risk:

(b) Liquidity risk:

AZTEC MINERALS CORP.

(An Exploration Stage Company)

(c) Market risk:

(i) Foreign currency risk:

(ii) Interest rate risk:

(iii) Other price risk:

1.14 Other MD&A Requirements

AZTEC MINERALS CORP.

1.14.1 Other MD&A Requirements

1.14.2 Outstanding Share Data

AZTEC MINERALS CORP.

(An Exploration Stage Company)

Management’s Discussion and Analysis

AZTEC MINERALS CORP.

1.15 Outlook

1.16 Risk Factors

Exploration and Development Risks

Financing Risks

Estimates of Mineral Deposits

AZTEC MINERALS CORP.

Commodity Prices

Competition and Agreements with Other Parties

Title Matters

AZTEC MINERALS CORP.

Surface Rights

Community Groups

Conflicts of Interest

Aztec Minerals Corp. Interim / Quarterly Report 2021