Eloro Resources Ltd. — Capital/Financing Update 2020

Dec 15, 2020

A copy of this preliminary short form prospectus has been filed with the securities regulatory authorities in each of the provinces of Canada, except Québec, but has not yet become final for the purpose of the sale of securities. Information contained in this preliminary short form prospectus may not be complete and may have to be amended. The securities may not be sold until a receipt for the short form prospectus is obtained from the securities regulatory authorities.

No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. This short form prospectus constitutes a public offering of these securities only in those jurisdictions where they may be lawfully offered for sale and therein only by persons permitted to sell such securities.

These securities have not been and will not be registered under the United States Securities Act of 1933, as amended, (the “ U.S. Securities Act ”) or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from registration is available. This short form prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered hereby within the United States or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the U.S. Securities Act). See “Plan of Distribution”.

Information has been incorporated by reference in this prospectus from documents filed with securities commissions or similar authorities in Canada. Copies of the documents incorporated herein by reference may be obtained on request without charge from the Secretary of Eloro Resources Ltd. at 20 Adelaide Street East, Suite 200, Toronto, Ontario, M5C 2T6, Canada, telephone (416) 868-9168, and are also available electronically at www.sedar.com.

PRELIMINARY SHORT FORM PROSPECTUS

NEW ISSUE

December 15, 2020

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Cdn$5,500,020

3,548,400 Units

This short form prospectus (the “ Prospectus ”) is being filed by Eloro Resources Ltd. (“ Eloro ” or the “ Corporation ”) to qualify the distribution (the “ Offering ”) of 3,548,400 units (“ Units ”) of the Corporation at a price of Cdn$1.55 per Unit (the “ Offering Price ”). Each Unit consists of one common share (each, a “ Common Share ”) in the capital of the Corporation (each, a “ Unit Share ”) and one-half of one Common Share purchase warrant of the Corporation (each whole Common Share purchase warrant, a “ Warrant ”). Each Warrant will entitle the holder thereof to acquire, subject to adjustment in certain circumstances, one Common Share (each, a “ Warrant Share ”) at an exercise price of Cdn$2.00 for a period of 24 months following the Closing Date (as defined herein). The Warrants will be governed by a warrant indenture (the “ Warrant Indenture ”) to be entered into on or before the Closing Date between the Corporation and TSX Trust Company (the “ Warrant Agent ”), as warrant agent. See “ Description of Securities Being Distributed ”.

The Units will be issued pursuant to an underwriting agreement (the “ Underwriting Agreement ”) dated December 15, 2020 between the Corporation and Haywood Securities Inc., as lead underwriter (the “ Lead Underwriter ”), and Echelon Wealth Partners Inc. (together with the Lead Underwriter, the “ Underwriters ”). The Offering Price was determined by negotiation between the Corporation and the Lead Underwriter. See “ Plan of Distribution ”.

The Common Shares are listed and posted for trading on the TSX Venture Exchange (the “ TSX-V ”) under the symbol “ELO”. On December 8, 2020, the last trading day before the public announcement of the Offering, the closing price per share of the Common Shares on the TSX-V was Cdn$1.71, and on December 14, 2020, the last trading day before the filing of the Prospectus, the closing price per share of the Common Shares on the TSX-V was Cdn$1.45. The Corporation has applied to list on the TSX-V the Unit Shares, Warrant Shares, the Additional Unit Shares (as defined below), Additional Warrant Shares (as defined below), and the Compensation Shares (as defined below) distributed under this Prospectus. Listing will be subject to the Corporation fulfilling all of the requirements of the TSX-V.

Per Unit Total[(3) ]

Price: Cdn$1.55 per Unit Price to the Public Underwriters’ Commission[(1) ] Net Proceeds to the Corporation Cdn$1.55 Cdn$0.1085 Cdn$1.4415 Cdn$5,500,020 Cdn$385,001.40 Cdn$5,115,018.60[ (2)]

Notes:

• (1) In consideration for the services rendered by the Underwriters in connection with the Offering, the Underwriters will be paid an aggregate cash fee (the “ Underwriters’ Commission ”) of Cdn$385,001.40, representing 7% of the gross proceeds of the Offering, or Cdn$442,751.61 if the Over-Allotment Option (as defined below) is fully exercised.

• (2) After deducting the Underwriters’ Commission, but before deducting expenses of the Offering, including in connection with the preparation and filing of this Prospectus, which are estimated to be Cdn$350,000 and which will be paid from the proceeds of the Offering.

• (3) The Corporation has granted the Underwriters an option (the “ Over-Allotment Option ”), exercisable in whole or in part, at any time and from time to time, in the sole discretion of the Underwriters, for a period of 30 days from the Closing Date (as defined below), to purchase up to an additional 532,260 Units (the “ Additional Units ”) of the Corporation at the Offering Price, to cover over-allotments, if any, and for market stabilization purposes, with each Additional Unit being comprised of one Unit Share (each, an “ Additional Unit Share ”) and one-half of one Warrant (each whole Warrant, an “ Additional Warrant ”), with each Additional Warrant exercisable at an exercise price of Cdn$2.00 for a period of 24 months following the Closing Date into one Warrant Share (each, an “ Additional Warrant Share ”). The Corporation will pay to the Underwriters a fee equal to 7% of the proceeds realized on the exercise of the Over-Allotment Option, being Cdn$0.1085 per Additional Unit sold. If the Over-Allotment Option is exercised in full, the total number of Units (including the Additional Units) sold in the Offering will be 4,080,660, the total price to the public will be Cdn$6,325,023 the total Underwriters’ Commission will be Cdn$442,751.61 and the net proceeds to the Corporation, before deducting the estimated expenses of the Offering, will be Cdn$5,882,271.39. This Prospectus also qualifies the grant of the Over-Allotment Option and the distribution of the Additional Units to be issued and sold upon any exercise of the Over-Allotment Option. See “Plan of Distribution”. A purchaser who acquires securities forming part of the Underwriters’ overallocation position will acquire those securities under this Prospectus, regardless of whether the over-allocation position is ultimately filled through the exercise of the Over-Allotment Option or secondary market purchases.

The following table sets out the number of Additional Units that may be issued by the Corporation to the Underwriters:

Underwriters’ Position(1)	Number of Securities Available	Exercise Period	Exercise Price
Over-Allotment Option	532,260 Additional Units	30 days following the Closing	Cdn$1.55 per Additional Unit
		Date
Compensation Options	285,646 Compensation Shares	24 months following the Closing	Cdn$1.55 per Compensation Share
		Date

Note:

(1) This Prospectus also qualifies the grant of the Over-Allotment Option and the Compensation Options. See “Plan of Distribution”.

Subject to applicable laws, the Underwriters may, in connection with the Offering, effect transactions intended to stabilize or maintain the market price of the Common Shares at levels above that which might otherwise prevail in the open market. Such transactions, if commenced, may be discontinued at any time. See “ Plan of Distribution ”.

The Underwriters, as principals, conditionally offer the Units subject to prior sales if, as and when issued by the Corporation, in accordance with the conditions contained in the Underwriting Agreement referred to under “ Plan of Distribution ”, subject to the approval of certain legal matters on behalf of the Corporation by Dickinson Wright LLP (“ DW ”) and on behalf of the Underwriters by McMillan LLP (“ McMillan ”). The Underwriters propose to offer the Units initially at the Offering Price. After the Underwriters have made a reasonable effort to sell all of the Units at the Offering Price, the Offering Price may be decreased and may be further changed from time to time to an amount not greater than the Offering Price, and the compensation realized by the Underwriters in respect of the Units will be decreased by the amount that the aggregate price paid by purchasers for the Units is less than the gross proceeds paid by the Underwriters to the Corporation. Such decrease will not decrease the amount of net proceeds of the Offering to the Corporation. The Underwriters will inform the Corporation if the Offering Price is decreased. See “ Plan of Distribution ”.

Subscriptions for the Units will be received subject to rejection or allotment in whole or in part, and the right is reserved to close the subscription books at any time without notice. It is expected that the completion of the sale of the Units pursuant to the Offering (the “ Closing ”) will take place on or about December 30, 2020, or on such other date as may be agreed upon by the Corporation and the Underwriters and, in any event, on or before a date not later than 42 days after the date of the receipt for the final short form prospectus (the “ Closing Date ”). Except as may be otherwise agreed by the Corporation and the Underwriters, the Offering will be conducted under the book-based system operated by CDS Clearing and Depository Services Inc. (“ CDS ”). Other than a subscriber of Units in a jurisdiction outside of Canada and the United States, a subscriber who purchases Units will receive a customary confirmation from the registered dealer from or through whom Units are purchased and who is a CDS participant. CDS will record the CDS participants who hold Units on behalf of owners who have purchased Units in accordance with the book-based system. Other than Units sold in jurisdictions outside of Canada and the United States, certificates evidencing the Units will not be issued unless specifically requested. See “ Plan of Distribution ”.

An investment in the Units is highly speculative and involves significant risks that should be carefully considered by prospective investors before purchasing such securities. The risks outlined in this Prospectus and in the documents incorporated by reference herein should be carefully reviewed and considered by prospective investors in connection with an investment in such securities. See “ Risk Factors ”.

Unless the context otherwise requires, when used herein, all references to the “Offering” include the exercise of the Over-Allotment Option, all references to “Units” include the Additional Units issuable upon exercise of the Over-Allotment Option, all references to “Unit Shares” include the Additional Unit Shares issuable upon exercise of the Over-Allotment Option, all references to “Warrants” include the Additional Warrants issuable upon exercise of the Over-Allotment Option, and all references to “Warrant Shares” include the Common Shares issuable upon exercise of the Additional Warrants.

Financial information in this Prospectus, including trading prices, is, unless otherwise indicated, presented in Canadian dollars. On December 14, 2020, the closing exchange rate for Canadian dollars, as quoted by the Bank of Canada, was US$1.00 = Cdn$1.2757 or Cdn$1.00 = US$0.7839.

The Corporation’s head and registered office is located at 20 Adelaide Street East, Suite 200, Toronto, Ontario, M5C 2T6, Canada.

TABLE OF CONTENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION ....................................... 1 IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS ............................................................ 3 TECHNICAL INFORMATION .................................................................................................................................... 3 FINANCIAL INFORMATION ..................................................................................................................................... 3 ELIGIBILITY FOR INVESTMENT............................................................................................................................. 3 DOCUMENTS INCORPORATED BY REFERENCE ................................................................................................ 4 MARKETING MATERIALS ....................................................................................................................................... 5 THE CORPORATION .................................................................................................................................................. 5 RECENT DEVELOPMENTS ....................................................................................................................................... 6 CONSOLIDATED CAPITALIZATION ...................................................................................................................... 7 USE OF PROCEEDS .................................................................................................................................................... 8 PLAN OF DISTRIBUTION .......................................................................................................................................... 9 DESCRIPTION OF SECURITIES BEING DISTRIBUTED ..................................................................................... 12 PRIOR SALES ............................................................................................................................................................ 14 TRADING PRICE AND VOLUME ........................................................................................................................... 14 MINERAL PROPERTY .............................................................................................................................................. 15 CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS .............................................................. 15 RISK FACTORS ......................................................................................................................................................... 18 INTEREST OF EXPERTS .......................................................................................................................................... 28 AUDITOR, TRANSFER AGENT AND REGISTRAR .............................................................................................. 28 STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION .......................................................................... 28 CERTIFICATE OF THE CORPORATION .............................................................................................................. C-1 CERTIFICATE OF THE UNDERWRITERS ........................................................................................................... C-2

(i)

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

Information and statements contained in this Prospectus that are not historical facts are forward-looking information or forward-looking statements within the meaning of Canadian securities legislation (hereinafter collectively referred to as “ forward-looking statements ”) that involve risks and uncertainties. This Prospectus contains forward-looking statements such as estimates and statements that describe the Corporation’s future plans, objectives or goals, including words to the effect that the Corporation or management expects a stated condition or result to occur. Examples of forward-looking statements in this Prospectus include, but are not limited to, statements with respect to:

• the Corporation’s ability to comply with permitting and regulatory requirements related to exploration, and development of its projects in Bolivia, Peru and Canada;

• the Corporation’s drill program at the Iska Iska Project (as defined below) for 2020 and beyond;

• the Corporation’s intention to conduct an exploration and development program at the Iska Iska Project;

• • the effect of the new Mining and Metallurgy Law ( Ley de Mineria y Metalurgia ) enacted by Law No. 535 on May 28, 2014 by the Bolivian government on the Corporation’s current and future operations at the Iska Iska Project;

• the anticipation that mineral resources at the Iska Iska Project can be developed with limited, systematic, underground drilling and channel sampling;

• the Corporation’s ability to meet the requirements for the maintenance of each of its mining concessions;

• the Corporation’s ability to continue accessing the surface lands overlying its concessions;

• the Corporation’s ability to secure required permitting approvals from relevant regulatory bodies in Bolivia, Peru and Canada;

• the Corporation’s ability to manage and/or mitigate any environmental and/or social risks associated with the development of any of its projects to the mining stage, as well as through mine construction and operation;

• the estimated capital and operating costs associated with the exploration, development, construction and operation of a mine, processing plant and other facilities required to start up a mine at any of its projects;

• • the Corporation’s ability to continue as a going concern;

• the Corporation’s going-forward strategy;

• the potential impact of COVID-19 on the Corporation’s operations;

• • commodity prices;

• the adequacy of the Corporation’s working capital;

• the Corporation’s expectation that it will incur operating losses in future periods due to ongoing expenses associated with the holding, exploration and development of the Corporation’s mineral property interests;

• • the Corporation’s ability, through the application of legal norms in the respective jurisdiction, and with the support of the relevant government authorities, to prevent illegal mining activity on its concessions;

• the mining assets optioned or acquired by the Corporation being and remaining attractive investment opportunities;

• the Corporation’s intention to retain any future earnings and other cash resources for the future development and operation of its business;

• the Corporation’s intention not to declare or pay any cash dividends in the foreseeable future;

• the completion and closing of the Offering and the timing thereof; and

• the use of proceeds of the Offering.

In certain cases, forward-looking statements can be identified by the use of words such as “plans”, “is expected”, “scheduled”, “estimates”, “intends”, “anticipates”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, or “might” occur or be achieved. Any such forwardlooking statements are based, in part, on assumptions and factors that may change, thus causing actual results or achievements to differ materially from those expressed or implied by the forward-looking statements. Such factors and assumptions may include, but are not limited to: assumptions concerning base and precious metal prices; cut-off grades; accuracy of any mineral resource estimates and resource modeling; timing and reliability of sampling and assay data; representativeness of mineralization; timing and accuracy of any metallurgical test work; anticipated political and social conditions; impact of the COVID-19 pandemic on the Corporation’s business and results of operations; expected government policy, including reforms; the ability to successfully raise additional capital; and other assumptions used as a basis for the preparation of the National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“ NI 43-101 ”) technical report titled “ NI 43-101 Property of Merit Technical Report on the

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Iska Iska Polymetallic Project, Sud Chichas Province, Department of Potosi, Bolivia ”, with an effective date of March 27, 2020 and dated April 27, 2020 (the “ Technical Report ”).

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and other factors include, among others, and without limitation:

• risks relating to price fluctuations for gold, silver, copper and other precious and base metals;

• risks inherent in mineral resource estimation (the Corporation currently does not have any mineral resources);

• risks relating to government expropriation or termination of the Corporation’s mineral property interests;

• • risks relating to inaccurate geological and engineering assumptions;

• risks relating to all of the Corporation’s mineral concessions and projects being located in Bolivia, Peru and Canada, including political, social, economic, security and regulatory instability;

• risks relating to changes in Bolivia, Peru and Canada’s national, provincial and local political leadership, including impacts these may have on general and mining specific public policies, administrative agencies and social stability;

• risks relating to local political and social unrest, including opposition to mining, pressure for economic benefits such as employment or social investment programs, access to land for agricultural or artisanal or illegal mining purposes, claims by aboriginal or indigenous peoples or other demands;

• risks relating to the social, political, environmental and geological conditions in areas in proximity to the concessions under development;

• risks relating to the Corporation’s rights or activities being impacted by litigation or administrative processes;

• risks relating to the Corporation’s ability to access concession surface areas and other properties needed to advance its exploration and development programs;

• risks relating to the Corporation’s operations being subject to environmental requirements, including remediation;

• risks relating to the Corporation’s ability to source qualified human resources, including managers, employees, consultants, attorneys, and sub-contractors, as well as to the performances of all such resources (including human error and actions outside of the control of the Corporation, such as negligence or malfeasance of its counterparties or agents, accidents and labour disputes);

• risks of title disputes or claims affecting mining concessions or surface ownership rights;

• risks relating to adverse changes to laws, regulations or other norms placing increased regulatory burdens or extending timelines for regulatory approval processes, including environmental, safety, social, taxation and other matters;

• risks associated with the Corporation’s community relationships, anti-development or anti-mining nongovernmental organizations;

• risks relating to delays in obtaining governmental agreements, approvals or permits necessary for the execution of exploration, development or construction activities;

• risks relating to competition inherent in the mining exploration industry, in Bolivia, Peru, Canada and elsewhere;

• risks of impacts from unpredictable natural occurrences, such as adverse weather conditions, fire, natural erosion, landslides, and geological activity, including earthquakes and volcanic activity;

• risks related to climate change, civil unrest, public health concerns (including health epidemics or pandemics or outbreaks of communicable diseases such as COVID-19) and other geopolitical uncertainties;

• • risks relating to inadequate insurance or inability to obtain insurance;

• risks relating to the Corporation’s ability to obtain necessary funding for its operations, at all or on terms acceptable to the Corporation;

• risks relating to the Corporation’s working capital and requirements for additional capital;

• risks relating to currency exchange fluctuations or changes in national currency;

• risks relating to fluctuations in interest and inflation rates;

• risks relating to restrictions on access to and movement of capital;

• risks relating to the value of the Corporation’s common shares fluctuating based on market factors;

• risks relating to the Corporation’s dependence on key personnel; and

• other risks of the mining industry.

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Forward-looking statements and other information contained herein, including general expectations concerning the mining industry, are based on estimates and forecasts prepared by the Corporation employing data from publicly available industry sources, as well as from market research and industry analysis, and on assumptions based on data and knowledge of this industry and the operating environments in Bolivia, Peru and Canada which the Corporation believes to be reasonable. Although generally indicative of relative market positions, market shares and performance characteristics, this data is inherently imprecise. While the Corporation is not aware of any misstatements regarding any data presented herein, the mining industry involves risks and uncertainties and the data is subject to change based on various factors.

In addition, all disclosure contained herein concerning future plans for the Iska Iska Project is subject to the assumptions and qualifications set forth in the Technical Report.

Readers of this Prospectus are cautioned not to put undue reliance on forward-looking information due to its inherent uncertainty. The Corporation disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, except in accordance with applicable securities legislation. This forward-looking information should not be relied upon as representing management’s views as of any date subsequent to the date of this Prospectus.

IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS

Readers should rely only on information contained or incorporated by reference in this Prospectus. Neither the Corporation nor any of the Underwriters has authorized anyone to provide the reader with different or additional information. If anyone provides the reader with different or additional information, the reader should not rely on it. Neither the Corporation nor any of the Underwriters is making an offer of these securities in any jurisdiction where the offer or sale is not permitted under applicable securities laws. Readers should assume that the information contained in this Prospectus or in any document incorporated by reference in this Prospectus is accurate only as of the respective date of the documents in which such information appears. The business, financial condition, results of operations and prospects of the Corporation may have changed since those dates. The Corporation does not undertake to update the information contained or incorporated by reference herein, except as required by applicable securities laws.

TECHNICAL INFORMATION

Certain of the scientific and technical information referenced in this Prospectus is supported by the Technical Report prepared by Charley Murahwi, MSc., P.Geo., FAusIMM, and Richard Gowans, P.Eng., of Micon International Limited (“ Micon ”).

FINANCIAL INFORMATION

The comparative consolidated financial statements of the Corporation as at and for the fiscal years ended March 31, 2020 and 2019 and the comparative unaudited interim consolidated financial statements of the Corporation as at and for the three and six months ended September 30, 2020, which have been prepared in accordance with International Financial Reporting Standards (“ IFRS ”), are incorporated by reference in this Prospectus and are reported in Canadian dollars. All currency amounts in the Prospectus are expressed in Canadian dollars, unless otherwise indicated. Financial information in this Prospectus, including trading prices, is, unless otherwise indicated, presented in Canadian dollars. On December 14, 2020, the closing exchange rate for Canadian dollars, as quoted by the Bank of Canada, was US$1.00 = Cdn$1.2757 or Cdn$1.00 = US$0.7839.

ELIGIBILITY FOR INVESTMENT

In the opinion of DW, counsel to the Corporation, and McMillan, counsel to the Underwriters, based on the provisions of the Income Tax Act (Canada), as amended (the “ Tax Act ”), the regulations thereunder (the “ Regulations ”) and the proposals to amend the Tax Act and the Regulations publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof, the Unit Shares, Warrants and Warrant Shares, if issued on the date hereof, would be qualified investments under the Tax Act and the Regulations for a trust governed by a

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registered retirement savings plan, a registered retirement income fund, a registered education savings plan, a registered disability savings plan, a tax-free savings account (collectively referred to as the “ Plans ”) or a deferred profit sharing plan (a “ DPSP ”), each as defined in the Tax Act, provided that:

• (i) in the case of the Unit Shares and the Warrant Shares, the Unit Shares or Warrant Shares, as applicable, are listed on a “designated stock exchange” as defined in the Tax Act (which currently includes Tier 2 of the TSX-V); and

• (ii) in the case of Warrants, the Warrant Shares are qualified investments as described in (i) above and neither the Corporation, nor any person with whom the Corporation does not deal at arm’s length for the purposes of the Tax Act, is an annuitant, a beneficiary, an employer or a subscriber under, or a holder of, the particular Plan or DPSP.

Notwithstanding the foregoing, the holder or subscriber of, or annuitant under, a Plan, as the case may be, (the “Controlling Individual”) will be subject to a penalty tax in respect of Unit Shares, Warrants or Warrant Shares held in the Plan if such securities are a "prohibited investment" (as defined in subsection 207.01(1) of the Tax Act) for the particular Plan. A Unit Share, Warrant or Warrant Share will generally be a prohibited investment for a Plan if the Controlling Individual does not deal at arm’s length (within the meaning of the Tax Act) with the Corporation or has a “significant interest” (as defined in subsection 207.01(4) of the Tax Act) in the Corporation. However, the Unit Shares and Warrant Shares will generally not be a "prohibited investment" if such shares are "excluded property" (as defined in subsection 207.01(1) of the Tax Act) for the Plan. Prospective investors to whom these rules may apply should consult their own tax advisors having regard to their particular circumstances.

DOCUMENTS INCORPORATED BY REFERENCE

Information has been incorporated by reference in this Prospectus from documents filed with the securities commissions or similar authorities in Canada. Copies of the documents incorporated herein by reference may be obtained on request without charge from Jorge Estepa, Vice President and Corporate Secretary of the Corporation, at 20 Adelaide Street East, Suite 200, Toronto, Ontario, M5C 2T6, Canada, telephone (416) 868-9168, and are also available electronically at www.sedar.com. The filings of the Corporation through the System for Electronic Document Analysis and Retrieval (“ SEDAR ”) are not incorporated by reference in this Prospectus except as specifically set out herein.

The following documents are specifically incorporated by reference into, and form an integral part of, this Prospectus:

• (a) the annual information form (the “ AIF ”) of the Corporation dated November 5, 2020 for the year ended March 31, 2020 and filed on SEDAR on November 12, 2020;

• (b) the audited consolidated statements of financial position of the Corporation as at March 31, 2020 and March 31, 2019 and the audited consolidated statements of loss and comprehensive loss, changes in equity and cash flows for the years ended March 31, 2020 and March 31, 2019, together with the auditor’s report thereon and the notes thereto;

• (c) management’s discussion and analysis for the year ended March 31, 2020;

• (d) the unaudited condensed interim consolidated financial statements of the Corporation as at and for the three and six months ended September 30, 2020, together with the notes thereto;

• (e) management’s discussion and analysis for the six months ended September 30, 2020;

• (f) the management information circular dated November 30, 2020 filed in connection with the annual and special meeting of the Corporation’s shareholders to be held on December 20, 2020;

• (g) the Technical Report;

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• (h) the material change report dated and filed on December 15, 2020 with respect to the announcement of the Offering;

• (i) the material change report of the Corporation dated November 28, 2020 filed in connection with certain exploration activities including assay results from five drill holes;

• (j) the material change report of the Corporation dated June 19, 2020 filed in connection with closing of a private placement of 5,000,000 units;

• (k) the material change report of the Corporation dated May 29, 2020 filed in connection with closing of a private placement of 2,200,000 units; and

• (l) the term sheet in respect of the Offering.

In addition to any document incorporated by reference in this Prospectus under applicable securities laws, any document of the type referred to above (excluding confidential material change reports) or referenced in Item 11.1 of Form 44-101 - Short Form Prospectus of the Canadian Securities Administrators filed by the Corporation with a securities commission or similar regulatory authority in Canada after the date of this Prospectus and prior to the termination of the Offering, shall be deemed to be incorporated by reference into this Prospectus.

Any statement contained in a document incorporated or deemed to be incorporated by reference herein is not incorporated by reference to the extent that any such statement is modified or superseded by a statement herein or in any subsequently filed document that is also, or is deemed to be, incorporated by reference herein. Any such modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or supersedes. The modified or superseded statement, when made, shall not be deemed an admission for any purpose that the modified or superseded statement, when made, constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement so modified or superseded shall not be considered in its unmodified or superseded form to constitute a part of this Prospectus; rather, only such statement as so modified or superseded shall be considered to constitute part of this Prospectus.

Reference to the Corporation’s website in any documents that are incorporated by reference into this Prospectus do not incorporate by reference the information on such website into this Prospectus, and the Corporation disclaims any such incorporation by reference.

MARKETING MATERIALS

Any “template version” of any “marketing materials” (as such terms are defined in National Instrument 41-101 – General Prospectus Requirements ) that are utilized by the Underwriters in connection with the Offering are not part of this Prospectus to the extent that the contents of the template version of the marketing materials have been modified or superseded by a statement contained in this Prospectus. Any template version of any marketing materials that has been, or will be, filed on SEDAR at www.sedar.com after the date of this Prospectus but before the termination of the distribution under the Offering (including any amendments to, or an amended version of, any “template version” of any marketing materials) is deemed to be incorporated herein by reference.

THE CORPORATION

Overview

The Corporation was incorporated on March 4, 1975 under the Business Corporations Act (Ontario) under the name “Boutin Resources Inc.”. The Corporation changed its name to “Cleyo Resources Inc.” on March 25, 1980 and to “Eloro Resources Ltd.” on July 4, 1997. The registered and head office of the Corporation is located at 20 Adelaide Street East, Suite 200, Toronto, Ontario, M5C 2T6, Canada, telephone: (416) 868-9168. The Corporation maintains regional offices in Lima, Peru and Tupiza, Bolivia.

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The following diagram illustrates the organizational structure of the Corporation as of December 15, 2020.

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Eloro Resources Ltd.
(Ontario)
82% 98% [(1)]
Compañia Minera Eloro Peru S.A.C. Minera Tupiza S.R.L.
(Peru) (Bolivia)
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Note: (1) Eloro has an option to purchase an additional 1% of Minera Tupiza S.R.L for consideration of US$3,000,000.

The Corporation is a reporting issuer in the provinces of Ontario, British Columbia and Alberta. The Corporation’s Common Shares trade on the TSX-V under the symbol “ELO”.

Eloro is a resource exploration company with a portfolio of gold and base-metal properties in Bolivia, Peru and Québec. The Corporation, through its Bolivian subsidiary, Minera Tupiza SRL (“ Minera Tupiza ”), has an option to acquire from Empresa Minera Villegas SRL (“ Empresa Minera ”) a 99% interest in the Iska Iska Project (the “ Iska Iska Project ”, “ Iska Iska ”, the “ Property ” or the “ Project ”), which can be classified as a polymetallic epithermalporphyry complex, a significant mineral deposit type in the Potosi Department, in southern Bolivia. Iska Iska is a road-accessible, royalty-free property. The Technical Report with respect to the Iska Iska Project is available on the Corporation’s website and under its filings on SEDAR (www.sedar.com).

The Corporation, through its Peruvian subsidiary, Compañia Minera Eloro Peru S.A.C., also owns an 82% interest in the La Victoria Gold/Silver Project (“ La Victoria ”), located in the North-Central Mineral Belt of Peru. La Victoria consists of eight mining concessions and eight mining claims encompassing approximately 89 square kilometres. La Victoria has access to infrastructure with access to road, water and electricity and is located at an altitude that ranges from 3,150 metres to 4,400 metres above sea level. A NI 43-101 technical report on the La Victoria property was completed by Gateway Solutions S.A.C., is dated August 31, 2016 and is available on the Corporation’s website and under its filings on SEDAR (www.sedar.com).

The Corporation’s focus is on the exploration and development of the Iska Iska Project, which Eloro considers to be its only material mineral project. The Corporation intends to continue to evaluate its existing mineral properties and, if deemed warranted, acquire new mineral properties and, contingent upon obtaining satisfactory exploration results, to develop such properties either through additional equity financings or by way of joint venture or option agreements, or through a combination of both. The Corporation is not in commercial production on any of its properties and, accordingly, the Corporation has no revenues and is considered to be a development stage company. The Corporation finances its operations by raising capital in the equity markets.

For further information regarding the Corporation and the Iska Iska Project, see the documents incorporated by reference in this Prospectus available at www.sedar.com under the Corporation’s profile.

RECENT DEVELOPMENTS

Private Placements of Units

On May 20, 2020, Eloro completed a private placement of 2,200,000 units at a price of $0.25 per unit for proceeds of $550,000. Each unit consisted of one Common Share and one-half of one warrant, with each whole warrant entitling the holder to purchase one Common Share for a price of $0.50 until November 20, 2021.

On June 9, 2020, the Corporation completed a private placement of 5,000,000 units at a price of $0.30 per unit for proceeds of $1,500,000. Each unit consisted of one Common Share and one-half of one warrant, with each whole warrant entitling the holder to purchase one Common Share for a price of $0.50 until June 9, 2022. In connection with the private placement, Eloro issued 7,000 broker warrants with the same terms as the unit warrants. In

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connection with the purchase of 4,500,000 units under the private placement, the Corporation granted a subscriber with the right to maintain its percentage holding of Common Shares by participating in any equity financing of Common Shares or securities of the Corporation which are convertible without further payment into Common Shares until June 9, 2023.

Iska Iska

On June 25, 2020, the Corporation announced that Minera Tupiza had contracted Empresa Minera to start underground drill bay preparations required for the planned 3,500 metres underground diamond drilling program (the “ Drill Program ”). The Corporation and contractor have implemented safeguards to protect personnel from the COVID-19 pandemic. Preparations included the rehabilitation of 400 metres of underground workings and preparation of drill bays in the Huayra Kasa mine and in the Mina 2 underground workings located 2 kilometres south of Huayra Kasa. All workings will be systematically geologically mapped and channel sampled. The Drill Program followed the outline presented in the Technical Report and is the first drilling to ever be carried out on the Property. The program is designed to test the full extent of the mineralized system in the vicinity of the mine workings.

On September 14, 2020, the Corporation announced that Minera Tupiza had commenced the Drill Program. Drilling, which will be HQ-sized core, is being carried out by Leduc Drilling S.R.L., an experienced Bolivian drill contractor.

On October 14, 2020, the Corporation announced that Minera Tupiza staked nine additional properties (known as “Mining Areas” under Bolivian law) covering a total of 311.75 square kilometres in the Potosí Department, southern Bolivia where Iska Iska is located. The properties are located on prominent ASTER (Advanced Spaceborne Thermal Emission and Reflection Radiometer) anomalies with a similar hydrothermal alteration signature to that of Iska Iska.

On November 18, 2020, the Corporation announced that Minera Tupiza completed thirteen diamond-drill holes which led to the discovery of a major breccia pipe with extensive silver polymetallic mineralization and a high-grade gold-bismuth zone in the Iska Iska Property.

On November 24, 2020, the Corporation announced that the diamond drilling has confirmed the presence of a second major mineralized breccia pipe approximately 400 metres in diameter at its Iska Iska Property.

Appointment of Technical and Senior Business Advisor

On June 15, 2020, Eloro appointed Dr. Quinton Hennigh as Technical and Senior Business Advisor. Dr. Hennigh is an economic geologist with 25 years of exploration experience, and is a founder and current Chairman and President of Novo Resources Corp., which is exploring and developing gold projects in the Pilbara region of Western Australia, including its Beatons Creek, Karratha and Egina gold projects, the latter of which is under a joint venture with Japan’s Sumitomo Corporation. Early in his career, Dr. Hennigh explored for major mining firms including Homestake Mining Company, Newcrest Mining Ltd and Newmont Mining Corporation. He then joined the junior mining sector in 2007 and has been involved with a number of Canadian listed gold companies, including Gold Canyon Resources Inc., where he led exploration at the Springpole alkaline gold project near Red Lake Ontario that was sold in 2015 to First Mining Gold Corp. Dr. Hennigh was also instrumental in Kirkland Lake Gold Ltd.’s acquisition of the Fosterville gold mine, which is located in Australia and was previously owned by Newmarket Gold Inc.

CONSOLIDATED CAPITALIZATION

The following table shows the effect of the Offering on the Corporation’s share capital as at the most recent financial period for which the most recently filed interim financial statements have been filed. This table should be read in conjunction with the Corporation’s most recently filed interim financial statements and associated management’s discussion and analysis, incorporated by reference herein:

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	As at	As at	As at
	September 30, 2020	September 30, 2020,	September 30, 2020,
	before giving effect to the	after giving effect to the Offering,	after giving effect to the
	Offering	assuming no exercise of the Over-	Offering, assuming full
		Allotment Option (1)(2)(3)	exercise of the Over-
			Allotment Option (4)5)(6)
Common Shares	Cdn$31,858,197	Cdn$36,623,215.60	Cdn$37,390,468.39
(authorized: unlimited)	(47,743,862 shares)(7)	(51,292,262 shares)	(51,824,522 shares)

Notes:

• (1) Assumes that none of the Warrants and Compensation Options issued under the Offering are exercised.

• (2) After deducting the Underwriters’ Commission of Cdn$385,001.40 and the estimated expenses of the Offering of Cdn$350,000.

• (3) 1,774,200 Warrants (exercisable for a total of 1,774,200 Common Shares) and 284,388 Compensation Options (exercisable for a total of 284,388 Common Shares) will also be issued under the Offering.

• (4) Assumes and that none of the Warrants and Compensation Options issued under the Offering are exercised.

• (5) After deducting the Underwriters’ Commission of Cdn$442,751.61 and the estimated expenses of the Offering of Cdn$350,000.

• (6) 2,040,330 Warrants (exercisable for a total of 2,040,330 Common Shares) and 285,646 Compensation Options (exercisable for a total of 285,646 Common Shares) will also be issued under the Offering.

• (7) Since September 30, 2020, the Corporation has issued 35,000 Common Shares.

USE OF PROCEEDS

The gross proceeds to the Corporation from the Offering will be Cdn$5,500,020 and the estimated net proceeds to the Corporation from the Offering are estimated to be Cdn$4,765,018.60, assuming the Over-Allotment Option is not exercised, after deducting the Underwriters’ Commission and the expenses of the Offering (including the out-ofpocket expenses of the Underwriters, the Underwriters’ legal expenses, and the legal and other expenses of the Corporation), which are estimated to be Cdn$350,000.

The Corporation intends to use the net proceeds of the Offering on exploration and development activities and on other corporate expenses as follows:

Project	Exploration and Development Activities	Amount (Cdn$)
	Activity/Description
Iska Iska	Geophysics (Ground magnetics)	$60,000
	6,000 metres of drilling at Santa Barbara/Huayra Kasa	$1,920,000
	4,000 metres of initial drilling at the Central Breccia	$1,280,000
	Pipe
SUBTOTAL		$3,260,000
Estimated expenses of the		$350,000
Offering
Other corporate expenses	General office and operating expenses and other	$990,000
	corporate purposes(1)
	Other properties in Peru (La Victoria)	$125,000
	Other properties in Bolivia	$125,000
	Contingencies	$265,018
TOTAL		$5,115,018

Note:

(1) Other corporate purposes include repayment of unsecured short-term loans from senior officers of the Corporation and/or corporations controlled by them, and payment of an incentive fee of up to Cdn$100,000 to management and others.

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If the Over-Allotment Option is exercised in full, the Corporation will receive approximately Cdn$5,882,271 in net proceeds, after deducting the Underwriters’ Commission of approximately Cdn$442,751 in connection therewith. The Corporation intends to use the estimated additional net proceeds from an exercise of the Over-Allotment Option for additional exploration and development work on the Iska Iska Project including toward part of a planned phase II program which phase II program contemplates a 4,000 metre drilling program at the Central Breccia Pipe at an estimated cost of $1,280,000, geophysics at the Caldera Complex at an estimated cost of $150,000, and a resource estimate at an estimated cost of $130,000.

The use of the net proceeds of the Offering by the Corporation described above is consistent with the accomplishment of the Corporation’s stated business objective of focusing its exploration efforts on the exploration and development of its Iska Iska Project.

While the Corporation believes that it has the skills and resources necessary to accomplish its stated business objectives, participation in the exploration for and development of mineral properties has a number of inherent risks. See the risk factors described under “ Risk Factors ” herein and in the Corporation’s AIF for factors that may impact the timing and success of the Corporation’s exploration programs in connection with its properties.

Pending expenditure, the Corporation intends to invest the proceeds of the Offering in short-term investments with high credit quality Canadian financial institutions. The Corporation currently intends to spend the funds available as stated in this Prospectus. However, there may be circumstances where, for sound business reasons, a reallocation of funds may be deemed prudent or necessary. The actual amount that the Corporation spends in connection with each of the intended uses of proceeds will depend on a number of factors, including those referred to under “ Risk Factors ”.

As at the date of this Prospectus, the Corporation had a working capital deficit of approximately Cdn$250,000 with a cash balance of approximately Cdn$15,000. As at September 30, 2020, the Corporation had cash of Cdn$1,013,207 and working capital of Cdn$809,227.

The Corporation generates no operating revenue from the exploration activities on its property interests and has negative cash flow from operating activities. The Corporation anticipates that it will continue to have negative cash flow until such time that commercial production is achieved at a particular project. To the extent that the Corporation has negative operating cash flows in future periods in excess of amounts disclosed above in the Use of Proceeds table, it may need to deploy a portion of its existing working capital to fund such negative cash flow.

PLAN OF DISTRIBUTION

Pursuant to the Underwriting Agreement, Eloro has agreed to sell and the Underwriters have severally (and not jointly or jointly and severally) agreed to purchase, as principals, on the Closing Date, 3,548,400 Units at the Offering Price, payable in cash (net of commission and costs and expenses of the Underwriters) to Eloro against delivery of the Units, subject to compliance with all necessary legal requirements and to the terms and conditions contained in the Underwriting Agreement. The obligations of the Underwriters under the Underwriting Agreement are several (and not joint or joint and several), are subject to certain closing conditions and may be terminated at their discretion upon the occurrence of certain stated events. The Underwriters are, however, obligated to take up and pay for all of the Units if any Units are purchased under the Underwriting Agreement. Under the Underwriting Agreement, the Underwriters are entitled to indemnification by the Corporation against certain liabilities and expenses. The Offering Price was determined by arm’s length negotiation between Eloro and the Lead Underwriter, on behalf of the Underwriters, with reference to the prevailing market price of the Common Shares.

Each Unit will consist of one Unit Share and one-half of one Warrant. Each Warrant will entitle the holder thereof to acquire, subject to adjustment in certain circumstances, one Warrant Share at an exercise price of Cdn$2.00 for a period of 24 months following the Closing Date. The Warrants will be created and issued pursuant to the terms of the Warrant Indenture. The Warrant Indenture will contain provisions designed to protect holders of the Warrants against dilution upon the happening of certain events. No fractional Warrant Shares will be issued. See “ Description of Securities Being Distributed — Warrants ”.

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Pursuant to the Underwriting Agreement, Eloro has agreed to (a) pay to the Underwriters a commission equal to 7% of the gross proceeds from the issue and sale of the Units (including any Additional Units issued and sold pursuant to the exercise of the Over-Allotment Option) and grant to the Underwriters non-transferable compensation options (the “ Compensation Options ”) equal to 7% of the aggregate number of Units sold under the Offering (including any Additional Units issued and sold pursuant to the exercise of the Over-Allotment Option), (b) pay the reasonable fees and expenses of the Underwriters in connection with the Offering, and (c) indemnify the Underwriters against certain expenses, liabilities, losses, claims, damages or actions that arise out of or are based, directly or indirectly, upon the performance of the professional services rendered to the Corporation by the Underwriters or in connection with the Offering, in accordance with the terms of the Underwriting Agreement. Each Compensation Option is exercisable into one Common Share (each, a “ Compensation Share ”) at the Offering Price for a period of 24 months following the Closing Date. This Prospectus also qualifies the distribution of the Compensation Options and the Compensation Shares. Other than the Underwriters’ Commission and the Compensation Options, the Underwriters will not receive any other fee or commission from the Corporation in connection with the Offering.

The Corporation has also granted to the Underwriters the Over-Allotment Option, which is exercisable in whole or in part for a period of 30 days from (and including) the Closing Date to cover over-allotments, if any, and for market stabilization purposes on the TSX-V. If the Over-Allotment Option is exercised in full, and before deducting the estimated expenses of the Offering (estimated to be Cdn$350,000), the total price to the public, Underwriters’ Commission and net proceeds to Eloro will be Cdn$6,325,023, Cdn$442,751.61 and Cdn$5,882,271.39, respectively. This Prospectus also qualifies the distribution of the Over-Allotment Option and the distribution of the Additional Unit Shares and Additional Warrants issuable on exercise of the Over-Allotment Option. A purchaser who acquires Additional Units forming part of the Underwriters’ over-allocation position acquires those Additional Units under this Prospectus, regardless of whether the over-allocation position is ultimately filled through exercise of the Over-Allotment Option or secondary market purchases.

Subscriptions will be received subject to rejection in whole or in part and the right is reserved to close the subscription books at any time without prior notice. It is expected that closing will occur on or about December 30, 2020, or such later date as the Corporation and the Underwriters may agree, but in any event not later than 42 days from the date of the final receipt for this Prospectus. Other than in respect of Unit Shares sold to any purchasers in a jurisdiction outside of Canada and the United States, which will be represented by individual certificates, the Unit Shares will be delivered under the book – based system through CDS or its nominee and deposited in registered or electronic form with CDS on the Closing Date. A purchaser of Units (other than any purchaser of Unit Shares in a jurisdiction outside of Canada and the United States) will receive only a customary confirmation from the registered dealer through which the Units are purchased.

The Corporation has agreed in favour of the Underwriters not to, sell, offer to sell, issue, grant any option, warrant or other right for the sale or issuance of, or otherwise lend, transfer, assign or dispose of (including without limitation by making any short sale, engaging in any hedging, monetization or derivative transaction or entering into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of Common Shares or other securities of the Corporation or securities convertible into, exchangeable for, or otherwise exercisable into Common Shares or other securities of the Corporation, whether or not cash settled), in a public offering or by way of private placement or otherwise, any Common Shares or any other securities of the Corporation, or agree to do any of the foregoing or publicly announce any intention to do any of the foregoing, other than issuances: (i) pursuant to the exercise of the Over-Allotment Option; (ii) under existing stock option, bonus or purchase plans or similar share compensation arrangements as detailed in the Corporation’s most recently-filed management discussion and analysis; (iii) upon the exercise of convertible securities, warrants or options outstanding prior to the Closing Date; or (iv) previously scheduled property payments and/or other corporate acquisitions, from the date hereof and continuing for a period of 90 days from the Closing Date without the prior written consent of the Lead Underwriter, such consent not to be unreasonably withheld or delayed.

Prior to Closing, the Corporation’s officers and directors will agree, subject to certain exceptions, not to directly or indirectly, offer, sell, contract to sell, grant any option to purchase, make any short sale, or otherwise dispose of, or transfer, or announce any intention to do so, any securities of the Corporation, whether owned or acquired after the date hereof, owned, directly or indirectly, or under such person’s control or direction, or with respect to which such person has beneficial ownership, or enter into any transaction or arrangement that has the effect of transferring, in whole or in part, any of the economic consequences of ownership of Common Shares, whether such transaction is settled by the delivery of Common Shares, other securities, cash or otherwise other than pursuant to a take-over bid

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or any other similar transaction made generally to all of the shareholders of the Corporation, for a period of 90 days from the Closing Date without the prior written consent of the Lead Underwriter, such consent not to be unreasonably withheld.

Certain of the Underwriters and their affiliates have performed investment banking, commercial banking and advisory services for the Corporation from time to time for which they have received customary fees and expenses.

The Underwriters and their affiliates may, from time to time, engage in transactions with and perform services for the Corporation in the ordinary course of their business.

The Offering is being made by the Underwriters concurrently in each of the provinces of Canada, except Québec, and in the United States through the Underwriters directly or through their United States brokerdealer affiliates registered in each jurisdiction, as applicable.

Subject to applicable law and the terms of the Underwriting Agreement, the Underwriters may also offer the Units in jurisdictions outside of Canada and the United Shares where the offer and sale of the Units will not require the qualification or registration of the Unit Shares, Warrant Shares, Additional Unit Shares and Additional Warrant Shares.

Eloro has applied to list the Unit Shares, Warrant Shares (including any Additional Unit Shares and Additional Warrant Shares) and the Compensation Shares distributed under this Prospectus on the TSX-V. Listing is subject to Eloro fulfilling all of the listing requirements of the TSX-V.

Pursuant to rules and policy statements of certain Canadian provincial securities commissions, the Underwriters may not, throughout the period of distribution under this Prospectus, bid for or purchase Common Shares for their own accounts or for accounts over which they exercise control or direction. The foregoing restriction is subject to certain exceptions, provided that the bid or purchase is not engaged in for the purpose of creating actual or apparent active trading in, or raising the price of, the Common Shares. These exceptions include a bid or purchase permitted under the Universal Market Integrity Rules for Canadian Marketplaces of the Investment Industry Regulatory Organization of Canada relating to market stabilization and passive market-making activities and a bid or purchase made for, or on behalf of a customer where the order was not solicited during the period of distribution. Subject to the foregoing and applicable laws, the Underwriters may over-allot or effect transactions in connection with the Offering intended to stabilize or maintain the market price of the Common Shares at levels other than those that might otherwise prevail in the open market. Such transactions, if commenced, may be discontinued at any time.

The Units offered under this Prospectus have not been and will not be registered under the Securities Act of 1933, as amended (the “ U.S. Securities Act ”), or any securities or “blue sky” laws of any of the states in the United States. Accordingly, the Units (or any rights thereto or interest therein) may not be offered for purchase or sale, or sold or otherwise transferred or disposed of within the United States or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the U.S. Securities Act) except in transactions exempt from the registration requirements of the U.S. Securities Act and any applicable state securities laws.

The Underwriters have agreed that they will not offer, sell or deliver the Units within the United States except in accordance with Rule 144A under the U.S. Securities Act and to Accredited Investors (as defined in Rule 501(a) of Regulation D under the U.S. Securities Act), and in compliance with applicable state securities laws. The Underwriters have also agreed that they will offer and sell the Units outside the United States only in accordance with Regulation S under the U.S. Securities Act. This Prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the Units in the United States. In addition, until 40 days after the commencement of the Offering, an offer or sale of Units within the United States by any dealer or agent (whether or not participating in the Offering) may violate the registration requirements of the U.S. Securities Act if such offer or sale is made other than in accordance with an exemption from the registration requirements of the U.S. Securities Act and in compliance with applicable state securities laws.

Units that are sold in the United States or to, or for the benefit or account of, U.S. Persons as defined in Regulation S under the U.S. Securities Act will be identified by a CUSIP number that is different from the CUSIP number that identifies Unit Shares sold outside the United States and the global certificate representing such Unit Shares and will contain a legend to the effect that the Unit Shares represented thereby have not been registered under the U.S.

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Securities Act and may only be offered, sold or otherwise transferred pursuant to certain exemptions from the registration requirements of the U.S. Securities Act.

The Underwriters propose to offer the Units to the public initially at the Offering Price set forth on the cover page of this Prospectus. Without affecting the firm obligation of the Underwriters to purchase the Units from the Corporation at the Offering Price in accordance with the Underwriting Agreement, after the Underwriters have made a reasonable effort to sell all of the Units offered hereby at the price specified herein, the Offering Price to the public may be decreased, and further changed from time to time, to an amount not greater than the Offering Price specified herein. Such decrease in the Offering Price will not decrease the amount of the net proceeds of the Offering to the Corporation. The compensation realized by the Underwriters will be decreased by the amount that the aggregate price paid by purchasers for the securities is less than the gross proceeds paid by the Underwriters to the Corporation.

DESCRIPTION OF SECURITIES BEING DISTRIBUTED

Offering

The Offering consists of Units, each of which is comprised of one Unit Share and one-half of one Warrant. The Units will separate into Unit Shares and Warrants immediately upon the closing of the Offering. The Units are offered at the Offering Price of Cdn$1.55 per Unit. This Prospectus qualifies the distribution of the Units, including the Unit Shares and the Warrants.

Common Shares

The Corporation is authorized to issue an unlimited number of Common Shares without par value, and an unlimited number of special shares (“ Special Shares ”) without par value. As of December 14, 2020, there were 47,778,862 Common Shares and no Special Shares issued and outstanding.

Holders of Common Shares are entitled to receive notice of all meetings of shareholders and to attend and vote the Common Shares at the meetings, except meetings at which only holders of a specified class of shares are entitled to vote, and holders of Common Shares shall be entitled to one vote for each Common Share held and, subject to the rights privilege restrictions and conditions attaching to any other class of shares of the Corporation, to receive the remaining property of the Corporation upon dissolution.

Warrants

The following is a summary of the principal attributes of the Warrants and certain anticipated provisions of the Warrant Indenture mentioned herein. The summary does not purport to be complete and is qualified in its entirety by the detailed provisions of the Warrant Indenture. A copy of the Warrant Indenture may be obtained on request from the Corporation and will be available electronically at www.sedar.com and reference should be made to the Warrant Indenture for the full text of the attributes of the Warrants. Each whole Warrant entitles its holder, upon the payment of the exercise price of Cdn$2.00, to purchase one Warrant Share for a period of 24 months from the Closing Date. See “ Plan of Distribution ”.

The Warrants will be governed by the Warrant Indenture. The Corporation will designate the Warrant Agent as agent for the Warrants. Prior to the closing of the Offering, the Corporation may name any other agent with respect to the Warrants. The Warrant Indenture will provide for adjustment in the number of Warrant Shares issuable upon the exercise of the Warrants and/or the exercise price per Warrant Share upon the occurrence of certain events, including:

• (a) the issuance of Common Shares or securities convertible into Common Shares to all or substantially all of the holders of Common Shares by way of a stock dividend or other distribution (other than a dividend paid in the ordinary course or a distribution of Common Shares upon the exercise of any outstanding warrants or options);

• (b) the subdivision, redivision or change of the Common Shares into a greater number of shares;

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• (c) the consolidation, reduction or combination of the Common Shares into a lesser number of shares;

• (d) the issuance to all or substantially all of the holders of Common Shares of rights, options or warrants under which such holders are entitled, during a period expiring not more than 45 days after the record date for such issuance, to subscribe for or purchase Common Shares, or securities exchangeable for or convertible into Common Shares, at a price per Common Share to the holder (or at an exchange or conversion price per share) of less than 95% of the “current market price”, as defined in the Warrant Indenture, of Common Shares on such record date; and

• (e) the issuance or distribution to all or substantially all of the holders of Common Shares of securities, including rights, options or warrants to acquire shares of any class or securities exchangeable for or convertible into Common Shares, any cash, property or assets, or any evidences of indebtedness.

The Warrant Indenture will also provide for adjustment in the class and/or number of securities or other property issuable upon the exercise of the Warrants and/or the exercise price per security upon the occurrence of the following additional events:

• (a) the reclassification of the Common Shares;

• (b) the amalgamation, arrangement or merger with or into any other corporation or other entity (other than an amalgamation, arrangement or merger which does not result in any reclassification of the Corporation’s outstanding Common Shares or a change of the Common Shares into other shares); or

• (c) the transfer of the Corporation’s undertakings or assets as an entirety or substantially as an entirety to another corporation or other entity.

No adjustment in the exercise price or number of Warrant Shares will be required to be made unless the cumulative effect of such adjustment or adjustments would result in a change of at least 1% in the exercise price or a change in the number of Warrant Shares purchasable upon exercise by at least one one-hundredth (1/100th) of a Common Share, as the case may be.

The Corporation will covenant in the Warrant Indenture that, during the period in which the Warrants are exercisable, the Corporation will give notice to Warrant holders of certain stated events, including events that would result in an adjustment to the exercise price for the Warrants or the number of Warrant Shares issuable upon exercise of the Warrants, at least 10 business days prior to the record date or effective date, as the case may be, of such event.

No fraction of a Warrant Share will be issued upon the exercise of a Warrant and no cash payment will be made in lieu thereof. Warrant holders are not entitled to any voting rights or pre-emptive rights or any other rights conferred upon a person as a result of being a holder of Common Shares.

From time to time, the Corporation and the Warrant Agent, without the consent of the holders of Warrants, may amend or supplement the Warrant Indenture for certain purposes, including curing defects or inconsistencies or making any change that does not adversely affect the rights of any holder of Warrants. Any amendment or supplement to the Warrant Indenture that adversely affects the interests of the holders of the Warrants may only be made by “extraordinary resolution”, which will be defined in the Warrant Indenture as a resolution either (1) passed at a meeting of the holders of Warrants at which there are present in person or represented by proxy at least two holders of Warrants representing at least 25% of the aggregate number of the then outstanding Warrants and passed by the affirmative vote of holders of Warrants representing not less than 66⅔% of the aggregate number of all the then outstanding Warrants represented at the meeting and voted on the poll for such resolution, or (2) adopted by an instrument in writing signed by the holders of not less than 66⅔% of the aggregate number of all then outstanding Warrants.

The Warrants and the Warrant Shares have not been and will not be registered under the U.S. Securities Act or any applicable state securities laws, and the Warrants will not be exercisable by or on behalf of a person in the United States or a U.S. Person, unless registered under the U.S. Securities Act or an exemption from such registration is

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available, and the Warrants and will bear a legend stating such. Certificates representing the Warrant Shares will not be registered or delivered to an address in the United States, unless an exemption from registration under the U.S. Securities Act and any applicable state securities laws is available and the Corporation has received an opinion of counsel of recognized standing or other evidence to such effect in form and substance reasonably satisfactory to the Corporation. At the time of exercise of the Warrants, the holder of the Warrant will be required to provide certification pursuant to the terms of the Warrants that the holder is not a U.S. person and the Warrant is not being exercised on behalf of a U.S. person, or provide the required opinion of counsel. A holder who is a “qualified institutional buyer” (as defined in Rule 144A under the U.S. Securities Act) or an “accredited investor” (as defined in Rule 501 under the U.S. Securities Act) at the time of exercise of the Warrants who purchased Units in the Offering to, or for the account or benefit of, persons in the United States or U.S. Persons will not be required to deliver an opinion of counsel or such other evidence in connection with the exercise of Warrants that are a part of those Units.

Compensation Options

The Compensation Options will be created and issued pursuant to the terms and conditions set out in the form of certificate representing the Compensation Options approved by the Corporation and the Underwriters. Each whole Compensation Option entitles its holder, upon the payment of the exercise price of Cdn$1.55, to purchase one Compensation Share for a period of 24 months from the Closing Date. See “ Plan of Distribution ”. The Compensation Options are non-transferable.

PRIOR SALES

No class of securities of the Corporation, other than the Common Shares, are listed for trading on a marketplace. The following table summarizes the issuance of Common Shares and other securities convertible into or exercisable for Common Shares by the Corporation during the 12-month period prior to the date of this Prospectus.

Date of Issuance	Security	Purchase/Exercise	Number of Securities
		Price per
		Security (Cdn$)
February 18, 2020	Stock Options	0.40	1,755,000
May 20, 2020	Common Shares	0.25	2,200,000
	Common Share	0.50	1,122,750
	purchase warrants
June 9, 2020	Common Shares	0.30	5,000,000
	Common Share	0.50	2,507,000
	purchase warrants
June 10, 2020	Stock Options	0.60	1,005,000

TRADING PRICE AND VOLUME

The Common Shares are listed and posted for trading on the TSX-V under the symbol “ELO”. The following table sets forth information relating to the trading price and volume of trading of the Common Shares for the months indicated.

Month	High (Cdn$)	Low (Cdn$)	Volume
December 2019	$0.300	$0.210	249,802
January 2020	$0.415	$0.230	1,051,000
February 2020	$0.460	$0.360	151,089
March 2020	$0.360	$0.200	777,637

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Month	High (Cdn$)	Low (Cdn$)	Volume
April 2020	$0.330	$0.220	303,623
May 2020	$0.400	$0.300	260,101
June 2020	$1.050	$0.375	2,249,639
July 2020	$1.120	$0.950	1,577,319
August 2020	$1.460	$0.970	1,193,870
September 2020	$1.890	$1.280	1,576,861
October 2020	$1.830	$1.180	1,259,361
November 2020	$1.950	$1.610	1,340,296
December 2020(1)	$1.840	$1.430	709,617
Note:
(1) From December 1 to December 14, 2020.

At the close of business on December 14, 2020, the last trading day prior to the date of this Prospectus, the closing price of the Common Shares on the TSX-V was Cdn$1.45.

MINERAL PROPERTY

Iska Iska Project

The Iska Iska Project is the only project that Eloro currently considers to be material. On April 29, 2020, the Corporation filed on SEDAR the Techical Report, which, among other things, describes scientific and technical information with respect to the Iska Iska Project. Technical disclosure regarding the Iska Iska Project is also contained in the AIF. The AIF and Technical Report are incorporated by reference into this Prospectus and may be obtained under Eloro’s profile on SEDAR at www.sedar.com or from Eloro’s Corporate Secretary at 20 Adelaide Street East, Suite 200, Toronto, Ontario, M5C 2T6, Canada, telephone (416) 868-9168.

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The following is, as of the date hereof, a general summary of certain of the Canadian federal income tax considerations generally applicable to a prospective purchaser of the Units pursuant to the Offering. For purposes of this summary, references to Common Shares include Unit Shares and Warrant Shares (including those issuable in respect of any exercise of the Over-Allotment Option) unless otherwise indicated. This summary is applicable only to a purchaser who is the beneficial owner of the Common Shares and Warrants acquired pursuant to the Offering and who, for the purposes of the Tax Act and at all relevant times, (i) is or is deemed to be resident in Canada, (ii) deals at arm’s length with the Corporation and the Underwriters, (iii) is not affiliated with Corporation or the Underwriters, and (iv) who will acquire and hold such Common Shares and Warrants as capital property (a “Holder”).

Common Shares and Warrants generally will be considered to be capital property to a Holder unless the Holder holds them in the course of carrying on a business or has acquired them in a transaction or transactions considered to be an adventure or concern in the nature of trade. Certain Holders who might not otherwise be considered to hold their Common Shares as capital property may, in certain circumstances, be entitled to have their Common Shares, and all other “Canadian securities” (within the meaning of the Tax Act) owned by such Holders, treated as capital property by making the irrevocable election permitted by subsection 39(4) of the Tax Act.

This summary does not apply to a Holder (i) that is a “specified financial institution” as defined in the Tax Act; (ii) that is a “financial institution” within the meaning of the “mark-to-market” rules in the Tax Act; (iii) an interest in which constitutes, or for whom a Common Share or Warrant would be, a “tax shelter investment” within the meaning of the Tax Act; (iv) whose “functional currency” for the purposes of the Tax Act is a currency of a country other than Canada; (v) that is exempt from tax under Part I of the Tax Act (vi) that has entered into or will enter into a "synthetic disposition arrangement" or a “derivative forward agreement” (as those terms are defined in the Tax Act) in respect of Common Shares or Warrants; (vii) that receives dividends on Common Shares under or as part of

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a “dividend rental arrangement” (as defined in the Tax Act); or (viii) that is a corporation resident in Canada, and is or becomes (or does not deal at arm’s length within the meaning of the Tax Act with a corporation resident in Canada that is or becomes) controlled by a corporation that is a non-resident of Canada (or pursuant to the Tax Proposals (as defined below), a non-resident person or a group of persons comprised of any combination of nonresident corporations, non-resident individuals or non-resident trusts that do not deal with each other at arm’s length) for purposes of the “foreign affiliate dumping” rules in section 212.3 of the Tax Act. In addition, this summary does not address the deductibility of interest by a Holder who has borrowed money or otherwise incurred debt in connection with the acquisition of Units. Such investors should consult their own tax advisors with respect to an investment in the Units.

This summary is based on the current provisions of the Tax Act and the Regulations, all specific proposals to amend the Tax Act (the “ Tax Proposals ”) which have been announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof, and counsel’s understanding of the current published administrative policies and assessing practices of the Canada Revenue Agency (the “ CRA ”) publicly available prior to the date hereof. This summary assumes that the Tax Proposals will be enacted in the form proposed and does not take into account or anticipate any other changes in law, including retroactive tax amendments, or administrative policies and assessing practices of the CRA, whether by way of judicial, legislative or governmental decision or action or otherwise, nor does it take into account provincial, territorial or foreign legislation or considerations, which may differ from the Canadian federal income tax considerations discussed herein. No assurance can be given that the Tax Proposals will be enacted as proposed or at all, or that legislative, judicial or administrative changes will not modify or change the statements expressed herein.

This summary is not exhaustive of all possible Canadian federal income tax considerations applicable to a Holder in respect of an investment in the Units. The following description of income tax matters is of a general nature only and is not intended to be, nor should it be construed to be, legal or income tax advice to any particular Holder. All investors, including Holders, are urged to consult their own income tax advisors with respect to the tax consequences applicable to them based on their own particular circumstances.

Allocation of Cost

A Holder who acquires Units pursuant to the Offering will be required to allocate the purchase price paid for each Unit on a reasonable basis between the Unit Share and the one-half Warrant comprising each Unit in order to determine their respective costs to such Holder for the purposes of the Tax Act.

For its purposes, the Corporation has advised counsel that, of the $1.55 Offering Price for each Unit, it intends to allocate $1.43 to each Unit Share and $0.12 to each one-half Warrant and believes that such allocation is reasonable. The Corporation’s allocation, however, is not binding on the CRA or on a Holder.

The adjusted cost base to a Holder of each Unit Share (comprising a part of a Unit acquired pursuant to the Offering) will be determined by averaging the cost of such Unit Share with the adjusted cost base to such Holder of all other Common Shares (if any) held by the Holder as capital property immediately prior to the acquisition.

Exercise of Warrants

No gain or loss will be realized by a Holder of a Warrant upon the exercise of such Warrant to acquire a Warrant Share. When a Warrant is exercised, the Holder’s cost of the Warrant Share acquired thereby will be equal to the adjusted cost base of the Warrant to such Holder, plus the amount paid on the exercise of the Warrant. For the purpose of computing the adjusted cost base to a Holder of each Warrant Share acquired on the exercise of a Warrant, the cost of such Warrant Share must be averaged with the adjusted cost base to such Holder of all other Common Shares (if any) held by the Holder as capital property immediately prior to the exercise of the Warrant.

Expiry of Warrants

In the event of the expiry of an unexercised Warrant, a Holder generally will realize a capital loss equal to the Holder’s adjusted cost base of such Warrant. The tax treatment of capital gains and capital losses is discussed in greater detail below under the subheading “ Capital Gains and Capital Losses ”.

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Disposition of Common Shares and Warrants

A disposition or deemed disposition of Common Shares (other than on a disposition to the Corporation that is not a sale in the open market in the manner in which shares would normally be purchased by any member of the public in an open market) or Warrants (other than on the exercise of a Warrant) by a Holder will generally result in the Holder realizing a capital gain (or capital loss) in the taxation year of the disposition to the extent that the Holder’s proceeds of disposition for such Common Shares or Warrants, as the case may be, exceed (or are less than) the aggregate of the Holder’s adjusted cost base thereof and any reasonable costs related to the disposition. See “ Capital Gains and Capital Losses ” below.

Capital Gains and Capital Losses

A Holder will generally be required to include one-half of any capital gain (a “taxable capital gain”) in computing its income for the taxation year of disposition or deemed disposition, and be entitled to deduct one half of any capital loss (an “allowable capital loss”) against taxable capital gains realized by the Holder in the year of disposition or deemed disposition. Allowable capital losses in excess of taxable capital gains in the taxation year in which they are realized may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any subsequent taxation year against taxable capital gains realized in such years, to the extent and under the circumstances specified in the Tax Act.

The amount of any capital loss realized on the disposition or deemed disposition of a Common Share by a Holder that is a corporation may, in certain circumstances, be reduced by the amount of dividends received or deemed to have been received by it on such share to the extent and in the circumstances specified by the Tax Act. Similar rules may apply where a Holder that is a corporation is a member of a partnership or is a beneficiary of a trust that owns Common Shares or where a partnership or trust, of which the corporate Holder is a member or a beneficiary, is a member of a partnership or a beneficiary of a trust that owns Common Shares. Holders to whom these rules may be relevant should consult their own income tax advisors.

A Holder that is, throughout the relevant taxation year, a Canadian-controlled private corporation for purposes of the Tax Act may be liable to pay an additional tax (refundable under certain circumstances) on its “aggregate investment income” for the year, which will generally include taxable capital gains.

Receipt of Dividends on Common Shares

Dividends received or deemed to be received by a Holder on Common Shares will be included in computing the Holder’s income for the purposes of the Tax Act.

Such dividends received by a Holder who is an individual (other than certain trusts) will be subject to the gross-up and dividend tax credit rules in the Tax Act normally applicable to taxable dividends received from “taxable Canadian corporations” (within the meaning of the Tax Act), including the enhanced gross-up and dividend tax credit in respect of taxable dividends designated by the Corporation as “eligible dividends” in accordance with the provisions of the Tax Act. There may be limitations on the ability of the Corporation to designate dividends as “eligible dividends”.

A Holder that is a corporation will be required to include such dividends in computing its income and generally will be entitled to deduct the amount of such dividends in computing its taxable income. In certain circumstances, subsection 55(2) of the Tax Act will treat a dividend or deemed dividend received by a Holder that is a corporation as a capital gain or proceeds of disposition. Such Holders should consult their own tax advisors in this regard.

A Holder that is a “private corporation” or “subject corporation” (within the meaning of the Tax Act) may be liable under Part IV of the Tax Act to pay an additional tax (refundable under certain circumstances) on dividends received or deemed to be received on the Common Shares to the extent such dividends are deductible in computing the Holder’s taxable income.

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Alternative Minimum Tax

Capital gains realized and taxable dividends received by a Holder who is an individual (other than certain trusts) may result in such Holders being liable for alternative minimum tax under the Tax Act. Such Holders should consult their own income tax advisors with respect to their particular circumstances.

RISK FACTORS

An investment in securities of the Corporation is highly speculative and involves significant risks. Any prospective investor should carefully consider the risk factors and all of the other information contained below and elsewhere in this Prospectus (including, without limitation, the documents incorporated by reference, and specifically under the section entitled “ Risks Factors ” in the AIF) before purchasing any of the securities distributed under this Prospectus. If any of the events contemplated in the risk factors described below or in the documents incorporated by reference actually occur, the Corporation’s business may be harmed and its financial condition and results of operation may suffer significantly. In that event, the trading price of the Common Shares could decline, and purchasers of the Units may lose all or part of their investment. The risks described herein and in the documents incorporated by reference in this Prospectus are not the only risks facing the Corporation. Additional risks and uncertainties not currently known to the Corporation, or that the Corporation currently deems immaterial, may also materially and adversely affect its business.

Nature of Mineral Exploration and Mining

At the present time, Eloro does not hold any interest in a mining property in production. Eloro's viability and potential for success lie in its ability to develop, exploit and generate revenue out of mineral deposits. The exploration and development of mineral deposits involve significant financial risks over a significant period of time which even a combination of careful evaluation, experience and knowledge may not eliminate. While discovery of a mine may result in substantial rewards, few properties which are explored are ultimately developed into producing mines. Major expenses may be required to establish reserves by drilling and to construct mining and processing facilities at a site. It is impossible to ensure that the current or proposed exploration programs on exploration properties in which Eloro has an interest will result in a profitable commercial mining operation.

The operations of Eloro are subject to all of the hazards and risks normally incidental to exploration and development of mineral properties, any of which could result in damage to life or property, environmental damage and possible legal liability for any or all damage. The activities of Eloro may be subject to prolonged disruptions due to weather conditions depending on the location of operations in which Eloro has interests. Hazards, such as unusual or unexpected formation, rock bursts, pressures, cave-ins, flooding or other conditions may be encountered in the drilling and removal of material. While Eloro may obtain insurance against certain risks in such amounts as it considers adequate, the nature of these risks are such that liabilities could exceed policy limits or could be excluded from coverage. There are also risks against which Eloro cannot insure or against which it may elect not to insure. The potential costs which could be associated with any liabilities not covered by insurance or in excess of insurance coverage or compliance with applicable laws and regulations may cause substantial delays and require significant capital outlays, adversely affecting the future earnings and competitive position of Eloro and, potentially, its financial position.

Whether a mineral deposit will be commercially viable depends on a number of factors, some of which are the particular attributes of the deposit, such as its size and grade, proximity to infrastructure, financing costs and governmental regulations, including regulations relating to prices, taxes, royalties, infrastructure, land use, importing and exporting and environmental protection. The effect of these factors cannot be accurately predicted, but the combination of these factors may result in Eloro not receiving an adequate return on invested capital.

Government expropriation may result in the total loss of the Corporation’s mineral property interests.

Even if the Corporation’s mineral properties are proven to host economic mineral resources, governmental expropriation or cancellation of one or more concessions may result in the total loss of the Corporation’s mineral property interests without any compensation to the Corporation. Similarly, expropriation or shutdown of financial institutions or other entities the Corporation does business with could impact operations. Further, expropriation of

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other businesses, in mining or other industries, could impact the Corporation’s ability to operate and obtain financing, as well as its strategic options. Finally, expropriation need not be outright, there are many forms of creeping expropriation, through taxation and other mechanisms, that if applied could negatively impact the Corporation’s operations and prospects.

Governmental regulation may have negative impacts on the Corporation.

The Corporation’s assets and activities are subject to extensive Canadian and foreign federal, provincial, territorial and local laws and regulations governing various matters, including, but not limited to:

• land access, use and ownership;

• water use;

• environmental protection;

• social consultation and investment;

• management and use of toxic substances and explosives;

• rights over and management of natural resources, including minerals and water;

• prospecting, exploration, development and construction of mines, production and reclamation;

• o exports and imports;

• taxation;

• mining royalties;

• importation of equipment and goods;

• transportation;

• hiring practices and labour standards by the Corporation and contractors, as well as occupational health and safety, including mine safety;

• reporting requirements related to investment, social and environmental impacts, health and safety, and other matters;

• processes for preventing, controlling or halting artisanal or illegal mining activities; and

• historic and cultural preservation.

The costs and efforts associated with compliance with laws and regulations are already substantial and future laws and regulations, changes to existing laws and regulations or more stringent application and enforcement of current laws and regulations by governmental authorities, could cause additional expenses, capital expenditures, delays in the development of the Corporation’s properties, and even restrictions on or suspensions of operations. Moreover, these laws and regulations may allow governmental authorities and private parties to bring complaints or lawsuits against the Corporation based upon alleged damage to property and/or injury to persons resulting from the environmental, health and safety impacts of the Corporation’s past and current operations, or possibly even actions or inaction by parties from whom the Corporation acquired its properties, and could lead to the imposition of substantial financial judgments, fines, penalties or other civil or criminal sanctions.

It is challenging to comply strictly with all of the norms that apply to the Corporation. The Corporation retains competent and trained staff, professionals, attorneys and consultants in jurisdictions in which it does business; however, there is no certainty that both it and its contractors will continuously be compliant with all applicable laws and regulations. The failure to comply with all applicable norms could lead to financial restatements, fines, penalties and other material negative impacts on the Corporation.

Failure to comply strictly with applicable laws, regulations and local practices may have a material adverse impact on the Corporation’s operations or business.

While the Corporation seeks to fully comply with applicable laws, regulations and local practices, failure to comply strictly with applicable laws, regulations and local practices relating to mineral rights applications and tenure could result in loss, reduction, cancellation or expropriation of entitlements, or the imposition of additional local or foreign parties as joint venture partners with carried or other interests. Any such loss, reduction or imposition of partners could have a material adverse impact on the Corporation’s operations or business. Furthermore, increasing complexity of mining laws and regulations may render the Corporation incapable of strict compliance.

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The exploration and future development of the Corporation’s property interests are subject to extensive laws, regulations and local practices governing health, safety, environment and communities.

The Corporation’s exploration and mine development activities are subject to extensive laws and regulations governing the protection of the environment, waste disposal, worker and community safety, employee health, mine development, and protection of water and endangered and protected species, as well as extensive reporting and community engagement requirements. The Corporation’s ability to obtain permits and approvals and to successfully operate in particular locations may be adversely impacted by real or perceived detrimental events associated with the Corporation’s activities or those of other mining companies or associations, or even illegal miners affecting the environment, human health, and safety of nearby communities. Delays in obtaining or failure to secure government permits and approvals, or to secure evictions of illegal miners, may adversely affect the Corporation’s ability to access, explore or develop its properties. The Corporation has made, and expects to make in the future, significant expenditures to comply with laws and regulations and to the extent reasonably possible, create social and economic benefit in nearby communities. The Corporation, however, may be required to remediate areas on its concessions impacted by the activities of third parties. Future changes to environmental laws, regulations and permitting processes or changes in their enforcement or regulatory interpretation could have an adverse impact on the Corporation’s operating and financial condition.

The Corporation’s concessions may be subject to pressure from artisanal and illegal miners.

Several of the Corporation’s concessions are located close to communities with long-standing artisanal, often illegal, mining traditions. Limited economic opportunities in these areas contribute to making gold mining an attractive field of work for local individuals and small associations and companies, who at times view concessions belonging to the Corporation as particularly attractive targets for alluvial or hard rock mining. In some cases, the local operators (occasionally financed by outsiders), having exhausted development opportunities at their current location, may seek to expand or relocate their activities into areas controlled by the Corporation and, in other cases, illegal miners may relocate to one of the Corporation’s concession areas in response to government pressure that has shut down their prior operations. Local and national political and regulatory authorities may come under pressure to support or not impede the ambitions of these local actors. The Corporation monitors local mining activities and is in regular contact with regulatory and political authorities to anticipate and manage issues as they arise; however not every incursion can be readily identified. Nonetheless, there is a risk that in the future, due to political or social factors, regulators may make decisions to grant access to artisanal miners that impact the viability of the Corporation’s projects.

Political and economic risks associated with operations in Bolivia.

The Iska Iska Project is located in Bolivia. Regardless of recent progress in restructuring its political institutions and revitalizing its economy, Bolivia's history since the mid-1960s has been one of political and economic instability under a variety of governments. Since 2006, the government has intervened in the national economy and social structure, including periodically imposing various controls, the effects of which have been to restrict the ability of both domestic and foreign companies to freely operate. Although the Corporation believes that the current conditions in Bolivia are relatively stable and conducive to conducting business, the Corporation’s current and future mineral exploration and mining activities in Bolivia are exposed to various levels of political, economic, and other risks and uncertainties. These risks and uncertainties include, but are not limited to, hostage taking, military repression, extreme fluctuations in currency exchange rates, high rates of inflation, political and labour unrest, civil unrest, expropriation and nationalization, renegotiation or nullification of existing concessions, licences, permits and contracts, illegal mining, changes in taxation policies, restrictions on foreign exchange and repatriation, changing political conditions, currency controls, and governmental regulations that favour or require the awarding of contracts to local contractors or require foreign contractors to employ citizens or purchase supplies from a particular jurisdiction.

There has been a significant level of social unrest in Bolivia in recent years resulting from a number of factors, including a high rate of unemployment. Protestors have previously targeted foreign firms in the mining sector and, as a result, there is no assurance that future social unrest will not have an adverse impact on the Corporation’s operations. The Corporation’s exploration and development activities may be affected by changes in government, political instability, and the nature of various government regulations relating to the mining industry. Bolivia’s fiscal regime has historically been favourable to the mining industry, but there is a risk that this could change. In addition, labour in Bolivia is customarily unionized and there are risks that labour unrest or wage agreements may impact

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operations. The Corporation cannot predict the government’s positions on foreign investment, mining concessions, land tenure, environmental regulation, or taxation. A change in government positions on these issues could adversely affect the Corporation’s business and/or its holdings, assets, and operations in Bolivia. Any changes in regulations or shifts in political conditions are beyond the control of the Corporation. The Corporation’s operations in Bolivia entail significant governmental, economic, social, medical, and other risk factors common to all developing countries. The status of Bolivia as a developing country may also make it more difficult for the Corporation to obtain any required financing because of the investment risks associated with it. The level of social unrest in Bolivia has increased significantly following the failed general elections held on October 20, 2019.

The Corporation’s operations in Bolivia may be adversely affected by economic uncertainty characteristic of developing countries. Operations may be affected in varying degrees by government regulations with respect to restrictions on production, price controls, export controls, currency remittance, income taxes, expropriation of property, foreign investment, maintenance of claims, environmental legislation, land use, land claims of local people, water use, and safety factors.

The Corporation may not be able to obtain or renew permits that are necessary for its operations.

In the ordinary course of business, the Corporation is required to obtain new governmental permits as well as renew permits for exploration and development activities and any ultimate development, construction and commencement of new mining operations. Obtaining or renewing necessary permits can be a complex and time-consuming process, which at times may involve several political jurisdictions and different government agencies that may not have the necessary expertise, resources or political disposition needed for efficient and timely processing, and may require public hearings and costly undertakings on the Corporation’s part. The duration and success of the Corporation’s efforts to obtain and renew permits are contingent upon many variables not within its control, including the interpretation of applicable requirements implemented by permitting authorities and timeframes for agency decisions. The Corporation may not be able to obtain or renew permits that are necessary to its operations, or the cost to obtain or renew permits may exceed what the Corporation believes it can recover from any of its projects once in production. Any unexpected delays or costs associated with the permitting process could slow exploration and/or development or impede the eventual operation of a mine, and could adversely impact the Corporation’s operations and profitability.

The mineral exploration industry is intensely competitive in all its phases and the Corporation competes with many companies, including those possessing greater financial resources and technical capabilities.

The mineral exploration industry is intensely competitive in all its phases. The Corporation competes with many companies, including those possessing greater financial resources and technical capabilities, for the acquisition of mineral concessions, claims, leases, other mineral interests, and equipment required to conduct its activities as well as for the recruitment and retention of qualified employees, and contracting of attorneys, consultants and technical experts.

Even if the Corporation makes a discovery of commercial quantities of minerals, there is no assurance that there will be market demand for the resource and that the investment will earn an adequate return.

There is no assurance that even if commercial quantities of minerals are discovered, a ready market will exist for their sale. Factors beyond the control of the Corporation may affect the marketability of any minerals discovered. These factors include: market fluctuations; domestic and international economic trends and political events; inflation or deflation; currency exchange fluctuations (specifically, the U.S. dollar relative to other currencies); interest rates and global or regional consumption patterns; speculative activities; and, government laws and regulations, including those relating to prices, taxes, royalties, land tenure, land use, labour, importing of equipment, importing and exporting of minerals, and environmental protection. The exact effect of any of these factors cannot be accurately predicted, but a combination of them may result in the Corporation not receiving an adequate return on invested capital or losing its invested capital.

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The Corporation does not own any commercial mineral deposits.

Neither the Iska Iska Project nor any of the Corporation’s other mineral projects currently contain known amounts of commercial mineral deposits. The Corporation’s program is exploratory only and there is no certainty that the expenditures to be made by the Corporation will result in the development of any commercial mineral deposits.

Substantial expenditures are required to be made by the Corporation to establish mineral resources or mineral reserves and the Corporation may either not discover minerals in sufficient quantities or grades or not be able to obtain the required funds to develop a project on a timely basis.

Substantial expenditures are required to establish mineral resources and mineral reserves through drilling and the estimation of mineral reserves or mineral resources in accordance with the CIM Definition Standards. Although significant benefits may be derived from the discovery of a major mineralized deposit, the Corporation may not discover minerals in sufficient quantities or grades to justify a commercial mining operation and the funds required for development may not be obtained on a timely basis or may not be obtainable on terms acceptable to the Corporation. Estimates of mineral reserves and mineral resources can also be affected by environmental factors, unforeseen technical difficulties and unusual or unexpected geological formations. In addition, the grades of minerals ultimately mined may differ from those indicated by drilling results. Material changes in mineral reserve or mineral resource estimates, grades, stripping ratios or recovery rates may affect the economic viability of any project.

The Corporation can be dependent on a single mineral project.

The Corporation currently has only one material mineral project. In the absence of additional material mineral projects, the Corporation may be solely dependent upon exploration and development of the Iska Iska Project for future revenue and profits. Should such exploration and development at the Iska Iska Project not be possible or practicable for political, engineering, technical or economic reasons, then the Corporation’s business and financial position will be significantly and adversely affected.

Risks relating to inaccurate estimates of mineral resources, production, purchases, costs, decommissioning or reclamation expenses.

Unless otherwise indicated, any mineralization figures presented by the Corporation in filings with securities regulatory authorities, press releases and other public statements that may be made from time to time, are based upon estimates made by Corporation personnel and independent geologists. These estimates are inherently imprecise, as they depend upon geological interpretation and statistical inferences drawn from drilling and sampling analysis, which may prove to be unreliable. As a result, there can be no assurance that any mineral resource or other mineralization figures or any estimates of costs (including initial capital costs and initial capital intensity) and expenses will be accurate, nor that the resource mineralization could be mined or processed profitably.

The Iska Iska Project is in the exploration stage and sufficient work has not been done to describe the mineralization on the Property with enough geological confidence for such mineralization to be reported as a mineral resource or a mineral reserve. Furthermore, any mineralization estimates for the Corporation’s properties may require adjustments or downward revisions based upon further exploration or development work or actual production experience. In addition, the grade of ore ultimately mined, if any, may differ from that indicated by and inferred from drilling results. Furthermore, there can be no assurance that minerals recovered in small-scale tests will be duplicated in large-scale tests under on-site conditions or at production scale. As a result, the mineral resource and mineral reserve estimates that may be contained in the Corporation’s filings with securities regulatory authorities, press releases and other public statements that may be made from time to time have been determined and valued based on assumed future prices, cut-off grades and operating costs that may prove to be inaccurate. In addition, extended declines in market prices for gold, silver or other metals may render portions of the Corporation’s mineralization uneconomic and result in reduced reported mineralization.

The estimated parameters for the Corporation’s projects may be changed as development and mining plans are generated and refined. These parameters would include estimates of how plants, equipment and processes may operate in the future at the Corporation’s projects, for which cost and productivity estimates may prove to be incorrect.

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Any material alteration in the above noted estimates, or of the Corporation’s ability to extract mineralization from its projects, could have a material adverse effect on the Corporation’s results or financial condition.

The inherent operational risks associated with mining, exploration and development, many of which are beyond the Corporation’s control.

The Corporation’s activities are subject to a high degree of risk due to factors that, in some cases, cannot be foreseen or anticipated, or controlled. These risks include, but are not limited to, tectonic or weather activity that may provoke landslides or other impacts, labour disruptions, legislative and regulatory changes, crime, the inability to obtain adequate sources of power, water, labour, suitable or adequate machinery and equipment, and expert attorneys and consultants. In addition, the Corporation may be unable to acquire or obtain such requirements as water rights and surface rights, which may be critical for the continued advancement of exploration, development and operational activities on its mineral concessions.

Inadequate infrastructure may adversely affect the Corporation’s operations and profitability.

Mining, development, exploration and production activities depend, to one degree or another, on adequate infrastructure. Reliable roads, bridges, power and fuel sources, as well as water supplies are important determinants which affect capital, as well as operating costs and safety. The lack of availability on acceptable terms or the delay in the availability of any one or more of these items could prevent or delay development of the Corporation’s projects. If adequate infrastructure is not available in a timely manner, there can be no assurance that the development of the Corporation’s projects will be commenced or completed on a timely basis, if at all. In addition, unusual or infrequent weather phenomena, tectonic activity, sabotage, government or other interference in the maintenance or provision of such infrastructure could adversely affect the Corporation’s operations and profitability.

The Corporation currently has limited liability insurance covering its assets and operations and, as a consequence, could incur considerable costs.

Mineral exploration involves risks, which, even with a combination of experience, knowledge and careful evaluation, mining exploration companies may not be able to overcome. Operations in which the Corporation has a direct or indirect interest may be subject to all the hazards and risks normally incidental to exploration of precious and non-precious metals, any of which could result in work stoppages, damage to property, and possible environmental damage. The Corporation presently has very limited commercial liability insurance and does not intend to increase its liability insurance. As a result of having limited liability insurance, the Corporation could incur significant costs that may have a materially adverse effect upon its financial condition and even cause the Corporation to cease operations.

The Corporation’s mineral property interests or surface property may be subject to prior unregistered agreements or transfers and therefore title to some of the Corporation’s property interests may be affected.

Although the Corporation has sought and received such representations as it has been able to achieve from vendors in connection with the acquisition of, or options to acquire, an interest in its mining properties and surface rights, and has conducted limited investigations of legal title to such properties, the properties may be subject to prior unregistered agreements or transfers or native land claims, or it is possible that title may be affected by undetected defects.

In addition, there is a risk that developing laws and movements respecting the acquisition and ownership of lands and other rights of local communities may alter the arrangements made by prior owners of the lands where the Corporation’s projects are located. Future laws and actions could have a material adverse effect on the Corporation’s exploration activities or on its financial position, cash flow and results of operations.

The prices of base and precious metals has fluctuated significantly in recent years and may adversely affect the economic viability of the Corporation’s mineral properties.

The Corporation’s revenues, if any, are expected to be almost entirely derived from the mining and sale of precious and base metals. The prices of those commodities have fluctuated widely, particularly in recent years, and are affected by numerous factors beyond the Corporation’s control, including: international economic and political trends;

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expectations of inflation; currency exchange fluctuations; interest rates; consumption patterns; speculative activities; and increased production due to new mine developments and improved mining and production methods. The effect of these factors on the price of precious and base metals, and, therefore, on the economic viability of the Corporation’s mining properties, cannot be accurately predicted, but nonetheless may adversely impact the Corporation’s ability to raise capital and conduct its operations.

All of the Corporation’s material subsidiaries and their mineral properties are in foreign countries and, therefore, a large portion of the Corporation’s business may be exposed to political, economic, security, and other risks and uncertainties.

Most of the Corporation’s mineral properties, and its material subsidiaries, are located in Bolivia and Peru. It may, therefore, be exposed to various types and degrees of security, economic, labour, political and other risks and uncertainties. These risks and uncertainties include, but are not limited to: terrorism; hostage taking; military repression; high rates of inflation; labour unrest; war or civil unrest; creeping or outright expropriation and nationalization; renegotiation or nullification of existing concessions, licenses, permits and contracts, including by way of invalidation of governmental acts; artisanal and illegal mining operations and the government’s enforcement of norms restricting these activities; changes in taxation and mining-related laws and regulations; trade protectionism, including restrictions or tariffs on imports; changes to the foreign exchange regime; changes to the currency regime; currency controls; restrictions on repatriation of funds; changing political conditions, including electoral results; challenges to the validity of governmental acts; and, governmental regulations that may favour or require the awarding of contracts to local contractors or require foreign contractors to employ residents of, or purchase supplies from, a particular jurisdiction. The reputation of Bolivia as a developing nation, perceived by many as having a track record of measures contrary to attracting investment in the mining sector and other areas of the economy, may make it more difficult for the Corporation to obtain any required exploration and development financing for its Bolivian projects.

Changes in mining or investment policies or shifts in political attitudes in Bolivia and Peru, their provinces or local political jurisdictions, may adversely affect the Corporation’s operations or potential profitability. Operations may be affected to varying degrees by modifications to government legislation and regulations with respect to, but not limited to: restrictions on production; price controls; export controls; currency remittances; taxes, including income taxes, property taxes, value added taxes, capital gains taxes, windfall taxes, and the sovereign adjustment tax; royalties; expropriation of property; foreign investment; maintenance of claims; the environment; land use; land claims or other demands by local people; social consultation and other permitting requirements; artisanal and illegal mining operations; labour; transportation; water use; and, mine safety. Failure to comply strictly with applicable laws, regulations and local practices relating to mineral rights applications and tenure, could result in loss, reduction or expropriation of entitlements, or the imposition of additional local or foreign parties as joint venture partners with carried or other interests.

The impact of one or more of these various factors and uncertainties, none of which can be accurately predicted, could have an adverse effect on the Corporation’s operations or potential profitability.

The Corporation may experience volatility in the market price of its Common Shares.

Securities of mineral companies have experienced substantial volatility in the past, often based on factors unrelated to the financial performance or prospects of the companies involved. These factors include macroeconomic conditions in North America and globally, and market perceptions of the attractiveness of particular industries or sectors. The price of the Corporation’s Common Shares is also likely to be significantly affected by short-term changes in mineral prices, currency exchange fluctuations, or its financial condition or results of exploration activities on its projects. Other factors unrelated to the performance of the Corporation that may have an effect on the price of the Corporation’s Common Shares include: the extent of analyst coverage available to investors concerning the business of the Corporation may be limited if investment banks with research capabilities do not follow the Corporation; lessening in trading volume and general market interest in the Corporation’s Common Shares may affect an investor’s ability to trade significant numbers of Common Shares; the size of the Corporation’s public float and whether it is included in market indices may limit the ability of some institutions to invest in the Common Shares; and, a substantial decline in the price of the Common Shares that persists for a significant period of time could cause the Common Shares to be delisted from an exchange, further reducing market liquidity. If an active market for the Common Shares does not continue, the liquidity of an investor’s investment may be limited,

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and the price of the Common Shares may decline. If an active market does not exist, investors may lose their entire investment in the Corporation. As a result of any of these factors, the market price of the Common Shares at any given point in time may not accurately reflect the long-term value of the Corporation. Securities class-action litigation often has been brought against companies following periods of volatility in the market price of their securities. The Corporation may in the future be the target of similar litigation. Securities litigation could result in substantial costs and damages and divert management’s attention and resources.

The Corporation’s foreign subsidiary operations may impact its ability to fund operations efficiently, as well as the Corporation’s valuation and stock price.

The Corporation conducts operations through foreign subsidiaries and substantially all of its assets are held in such entities. Accordingly, any limitation on the transfer of cash or other assets between the parent corporation and such entities, or among such entities, could restrict the Corporation’s ability to fund its operations efficiently. Any such limitations, or the perception that such limitations may exist now or in the future, could have an adverse impact on the Corporation’s valuation and stock price.

The value of the Corporation’s Common Shares, as well as its ability to raise equity capital, may be impacted by future issuances of shares.

The Corporation is authorized to issue an unlimited number of Common Shares without par value. The Corporation may issue more Common Shares in the future. Sales of substantial amounts of Common Shares (including shares issuable upon the exercise of stock options), or the perception that such sales could occur, could materially adversely affect prevailing market prices for the Common Shares and the ability of the Corporation to raise equity capital in the future.

The Corporation’s future performance is dependent on key personnel. The temporary or permanent loss of the services of any of the Corporation’s and its subsidiary’s executives or directors could have a material adverse effect on the Corporation’s business.

The Corporation’s performance is substantially dependent on the performance and continued efforts of the Corporation’s executives and the board of directors. The loss of the services of any of the Corporation’s executives or directors could have a material adverse effect on the Corporation business, results of operations and financial condition. The Corporation currently does not carry any key person insurance on any of its executives or directors. The Corporation has limited resources and is currently unable to compete with larger organizations with respect to compensation and perquisites.

The tax regimes in Bolivia and Peru may be subject to change without notice.

The tax regimes in Bolivia and Peru may be subject to differing interpretations and is subject to change without notice. The Corporation’s interpretation of tax law as applied to its transactions and activities may not coincide with that of the tax authorities. As a result, the taxation applicable to transactions and operations may be challenged or revised by the tax authorities, which could result in significant additional taxes, penalties and/or interest.

There is a risk that restrictions on the repatriation of earnings from Bolivia and Peru to foreign entities will be imposed in the future. In addition, the Corporation has no control over withholding tax rates. There is a risk that the Corporation’s access to financing may be limited as a result of indirect taxation.

Information Systems and Cyber Security

The Corporation’s operations depend on information technology (“ IT ”) systems. These IT systems could be subject to network disruptions caused by a variety of sources, including computer viruses, security breaches and cyberattacks, as well as disruptions resulting from incidents such as cable cuts, damage to physical plants, natural disasters, terrorism, fire, power loss, vandalism and theft. The Corporation’s operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, IT systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in IT system failures, delays and/or increase in capital expenses. The failure of IT systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Corporation’s reputation and results of operations.

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Although to date the Corporation has not experienced any material losses relating to cyber-attacks or other information security breaches, there can be no assurance that the Corporation will not incur such losses in the future. The Corporation’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority. As cyber threats continue to evolve, the Corporation may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.

The Corporation is exposed to financial risk arising from fluctuations in the exchange rates between the U.S. dollar and Canadian dollar.

While the Corporation and its subsidiaries incur the majority of their expenditures in U.S. dollars, corporate G&A expenses are primarily paid in Canadian dollars. Thus, the Corporation is exposed to financial risk arising from fluctuations in the exchange rates between the U.S. dollar and Canadian dollar, and the degree of volatility of these rates. The Corporation does not use derivative instruments to reduce its exposure to foreign currency risks.

Public Health Crises

The Corporation’s business, operations and financial condition could be materially and adversely affected by the outbreak of epidemics or pandemics or other health crises, including the recent outbreak of COVID-19. On January 30, 2020, the World Health Organization declared the outbreak a public health event of international concern, and on March 11, 2020, the World Health Organization declared the outbreak a pandemic. To date, there have been a large number of temporary business closures, quarantines and a general reduction in consumer activity worldwide. The COVID-19 outbreak has caused companies and various international jurisdictions to impose travel, gathering and other public health restrictions. While these effects are expected to be temporary, the duration of the various disruptions to businesses locally and internationally and the related financial impact cannot be reasonably estimated at this time. Although the Corporation is actively monitoring the situation and assessing and responding where possible to the potential impact of the COVID-19 pandemic, it cannot estimate whether any additional restrictions will be imposed on its activities and the potential financial and operational impact thereof.

Such public health crises can result in volatility and disruptions in the supply and demand for metals and minerals, global supply chains and financial markets, as well as declining trade and market sentiment and reduced mobility of people, all of which could affect commodity prices, interest rates, credit ratings, credit risk and inflation. The risks to the Corporation of such public health crises also include risks to employee health and safety, a slowdown or temporary suspension of operations, increased labour and fuel costs, regulatory changes, political or economic instabilities or civil unrest. Similarly, the Corporation’s ability to obtain financing and the ability of the Corporation’s vendors, suppliers, consultants and partners to meet their obligations to the Corporation may be impacted as a result of the COVID-19 outbreak and efforts to contain the virus. At this point, the extent to which COVID-19 will or may impact the Corporation is uncertain and will depend on the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, the length of travel and quarantine restrictions imposed by governments of affected countries and other factors that are beyond the Corporation’s control. Consequently, the COVID-19 outbreak may have a material adverse effect on the Corporation’s business, results of operations and financial condition (including the Corporation’s ability to obtain financing).

Dependence on Outside Parties

The Corporation has relied upon consultants, engineers and others and intends to rely on these parties for development, construction and operating expertise. Substantial expenditures are required to construct mines, to establish mineral reserves through drilling, to carry out environmental and social impact assessments, to develop metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the exploration and plant infrastructure at any particular site. If such parties’ work is deficient or negligent or is not completed in a timely manner, it could have a material adverse effect on the Corporation.

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Volatility of Stock Price

In recent years, the securities markets in the United States and Canada have experienced a high level of price and volume volatility, and the market prices of securities of many companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. There can be no assurance that continual fluctuations in price will not occur. It may be anticipated that any quoted market for the Common Shares will be subject to market trends generally, notwithstanding any potential success of the Corporation in creating revenues, cash flows or earnings. The value of Units distributed hereunder will be affected by such volatility.

Conflicts of Interest

The directors and officers of Eloro may serve as directors or officers of other public resource companies or have significant shareholdings in other public resource companies. Situations may arise in connection with potential acquisitions and investments where the other interests of these directors and officers may conflict with the interests of Eloro. In the event that such a conflict of interest arises at a meeting of the directors of Eloro, a director is required by the Business Corporations Act (Ontario) to disclose the conflict of interest and to abstain from voting on the matter.

Competition

The mineral exploration and mining business is competitive in all of its phases. Eloro competes with numerous other companies and individuals, including competitors with greater financial, technical and other resources than Eloro, in the search for and acquisition of attractive mineral properties. The ability of Eloro to acquire properties in the future will depend not only on its ability to develop its present properties, but also on its ability to select and acquire suitable properties or prospects for mineral exploration. There is no assurance that Eloro will continue to be able to compete successfully with its competitors in acquiring such properties or prospects.

Potential Dilution

The Corporation’s articles of incorporation and by-laws allow it to issue an unlimited number of Common Shares for such consideration and on such terms and conditions as established by the board of directors of the Corporation, in many cases, without the approval of the Corporation’s shareholders. As part of this Offering, the Corporation could issue up to 4,080,660 Units (which number includes the 532,260 Units issuable if the Over-Allotment Option is exercised in full by the Underwriters). The Corporation may issue additional Common Shares in subsequent offerings (including through the sale of securities convertible into or exchangeable for Common Shares) and on the exercise of stock options or other securities exercisable for Common Shares. The Corporation cannot predict the size of future issuances of Common Shares or the effect that future issuances and sales of Common Shares will have on the market price of the Common Shares. Issuances of a substantial number of additional Common Shares, or the perception that such issuances could occur, may adversely affect prevailing market prices for the Common Shares. With any additional issuance of Common Shares, investors will suffer dilution to their voting power and the Corporation may experience dilution in its earnings per share.

Forward-looking statements may prove to be inaccurate

Investors should not place undue reliance on forward-looking statements. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, of both general and specific nature, that could cause actual results to differ materially from those suggested by the forward-looking statements or contribute to the possibility that predictions, forecasts or projections will prove to be materially inaccurate. Additional information on such risks, assumptions and uncertainties can be found in this Prospectus under the heading “Forward Looking Statements”.

The Corporation may use the proceeds of the Offering for purposes other than those set out in this Prospectus

The Corporation currently intends to allocate the net proceeds received from the Offering as described under the heading “Use of Proceeds” in this Prospectus. However, management will have discretion in the actual application

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of the proceeds, and may elect to allocate proceeds differently from that described under the heading “Use of Proceeds” if it believes that it would be in the best interests of the Corporation to do so if circumstances change. The failure by management to apply these funds effectively could have a material adverse effect on the business of the Corporation

Potential need for additional financing

Despite the anticipated net proceeds from the Offering, the Corporation may require additional financing, including through the sale of assets and/or the issue and sale of equity or debt securities to satisfy the operational and capital costs at its properties, if various events alone or in combination occur. There can be no assurance that the Corporation will be able to obtain necessary financing in a timely manner or on acceptable terms, if at all.

INTEREST OF EXPERTS

The following persons or companies, whose profession or business gives authority to the report, valuation, statement or opinion made by the person or company, are named in this Prospectus as having prepared or certified a report, valuation, statement or opinion in this Prospectus either directly or in a document incorporated by reference herein.

Each of DW, counsel for the Corporation, and McMillan, counsel for the Underwriters, has provided its opinion on certain matters contained in this Prospectus. As at the date hereof, partners and associates of DW and McMillan, each as a group, own, directly or indirectly, in the aggregate, less than 1% of the securities of the Corporation or any associate of affiliate of the Corporation.

Charley Murahwi, MSc., P.Geo., FAusIMM and Richard Gowans, P.Eng. of Micon are the authors of the Technical Report. Each of the authors is a “qualified person” as defined in NI 43-101. The aforementioned persons held less than 1% of the securities of the Corporation or of any associate or affiliate of the Corporation when they prepared the Technical Report, did not receive any direct or indirect interest in any securities of the Corporation or of any associate or affiliate of the Corporation in connection with the preparation of such report and, as at the date hereof, held less than 1% of the securities of the Corporation. None of the aforementioned persons is currently expected to be elected, appointed or employed as a director, officer or employee of the Corporation or of any associate or affiliate of the Corporation.

RSM Canada LLP, Chartered Professional Accountants and Licensed Public Accountants, is the auditor of the Corporation and is independent of the Corporation within the meaning of the Rules of Professional Conduct of the Institute of Chartered Accountants of Ontario.

AUDITOR, TRANSFER AGENT AND REGISTRAR

The auditor of the Corporation is RSM Canada LLP, Chartered Professional Accountants and Licensed Public Accountants, located at 11 King Street West, Suite 700, Toronto, Ontario, Canada, M5H 4C7.

TSX Trust Company is the transfer agent and registrar for the Common Shares, located at 301 - 100 Adelaide Street West, Toronto, Ontario, Canada, M5H 4H1.

STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION

Securities legislation in certain of the provinces of Canada provides purchasers with the right to withdraw from an agreement to purchase securities. This right may be exercised within two business days after receipt or deemed receipt of a prospectus and any amendment. In several of the provinces of Canada, the securities legislation further provides a purchaser with remedies for rescission or, in some jurisdictions, revision of the price or damages if the prospectus and any amendment contains a misrepresentation or is not delivered to the purchaser, provided that the remedies for rescission, revision of the price or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province for the particulars of these rights or consult with a legal advisor.

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CERTIFICATE OF THE CORPORATION

Dated: December 15, 2020

This short form prospectus, together with the documents incorporated by reference, constitute full, true and plain disclosure of all material facts relating to the securities offered by this short form prospectus as required by the securities legislation of each of the provinces of Canada, except for Québec.

(Signed) “Thomas Larsen” Chief Executive Officer

(Signed) “Miles Nagamatsu” Chief Financial Officer

On behalf of the Board of Directors

(Signed) “Alexander S. Horvath” Director

(Signed) “Dusan Berka” Director

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CERTIFICATE OF THE UNDERWRITERS

Dated: December 15, 2020

To the best of our knowledge, information and belief, this short form prospectus, together with the documents incorporated by reference, constitute full, true and plain disclosure of all material facts relating to the securities offered by this short form prospectus as required by the securities legislation of each of the provinces of Canada, except for Québec.

HAYWOOD SECURITIES INC.

(Signed) “Ryan Matthiesen” By: _______ Ryan Matthiesen, Managing Director

ECHELON WEALTH PARTNERS INC.

(Signed) “Jason Yeung” By: _______ Jason Yeung, Managing Director

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