Galactic Gold Corp. — Management Reports 2020

Aug 20, 2020

Logica Ventures Corp. Management Discussion and Analysis For the Six‐Month Period Ended June 30, 2020

August 20, 2020

The following management discussion and analysis (“MD&A”) of the results of the operations and financial position of Logica Ventures Corp. (the “Company” or “Logica”) prepared for the six month period ended June 30, 2020 and should be read in conjunction with the Company’s unaudited condensed interim financial statements for the six‐month period ended June 30, 2020 and the audited financial statements for the period from March 6, 2019 to December 31, 2019. All figures contained in this MD&A are presented in Canadian dollars.

Forward‐Looking Statements

Certain statements contained in this MD&A may constitute forward‐looking statements. These statements relate to future events or the Company’s future performance. All statements, other than statements of historical fact, may be Forward‐looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “propose”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward looking statements. The Company believes that the expectations reflected in those forward‐looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward‐looking statements included in this MD&A should not be unduly relied upon by investors as actual results may vary. These statements speak only as of the date of this MD&A and are expressly qualified, in their entirety, by this cautionary statement. The Company’s actual results could differ materially from those anticipated in these forward‐looking statements as a result of various risk factors.

The Company

Logica was incorporated under the Business Corporations Act (Ontario) on March 6, 2019 and is classified as a Capital Pool Company, as defined in the Policy 2.4 (the "Policies") of the TSX Venture Exchange (the “Exchange”).

The principal business of the Company will be the identification and evaluation of assets or businesses with a view to completing a qualifying transaction (“QT”) as defined in the Policies of the Exchange. The Company has not commenced operations and has no assets other than cash and funds held in trust. The Company’s continuing operations as intended are dependent upon its ability to identify, evaluate and negotiate an acquisition, or business, or an interest therein. Such an acquisition will be subject to the approval of the regulatory authorities concerned and, in the case of a non‐arm’s length transaction, of the majority of the disinterested shareholders.

The proceeds raised from the issuance of share capital may only be used to identify and evaluate assets or businesses for future investment, with the exception that up to the lesser of 30% of the gross proceeds realized by the Company in respect of the sale of its securities or $146,100, may be used for purposes other than evaluating businesses or assets. These restrictions apply until completion of a QT by the Company as defined under the policies of the Exchange. The Company is required to complete its QT on

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or before two years from the date the Company receives regulatory approval and its common shares are listed on the Exchange.

On December 19, 2019, the Company completed its initial public offering (the “Offering”) of 3,000,000 common shares at a purchase price of $0.10 per common share for aggregate gross proceeds of $300,000. Echelon Wealth Partner Inc. (“the Agent”) in connection with the Offering received a cash commission of $30,000, equal to 10% of the aggregate gross proceeds from the sale of the common shares. The Agent also received 300,000 agent warrants. Each agent warrant is exercisable to acquire one common share at a price of $0.10 for a period of 24 months.

The head office and the registered head office of the Company is located at 365 Bay Street, Suite 800, Toronto, Ontario M5H 2V1.

On August 20, 2020, the Board of Directors approved the unaudited condensed interim financial statements for the six‐month period ended June 30, 2020.

Summary of Quarterly Results

	April 1, 2020 to June 30, 2020 $	January 1, 2020 to March 31, 2020 $	October 1, 2019 to December 31, 2019 $	July 1, 2019 to September 30, 2019 $
Total assets	268,469	268,494	365,167	184,343
Total revenue	‐	‐	‐	‐
Total expenses	13,865	16,333	128,863	24,458
Net loss	13,865	16,333	128,863	24,458
Basic and diluted net loss per share	0.01	0.01	1.00	0.01

	March 6, 2019 to June 30, 2019 $
Total assets	170,072
Total revenue	‐
Total expenses	23,262
Net loss	23,262
Basic and diluted net loss per share	0.01

The Company recorded a loss of $13,865 during the three months ended June 30, 2020. The net loss is comprised of professional fees of $2,023, filing fees of $10,482 and office expenses of $1,360.

The Company recorded a loss of $16,333 during the three months ended March 31, 2020. The net loss is comprised of professional fees of $3,623, rent of $6,780 and office expenses of $5,930.

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The Company recorded a loss of $128,863 during the three months ended December 31, 2019. The net loss is comprised of IPO transaction fees of $41,920, share‐based payments of $60,660, professional fees of $8,000, rent of $6,780, filing fees of $11,300 and office expenses of $203.

The Company recorded a loss of $24,458 during the three months ended September 30, 2019. The net loss is comprised of professional fees of $1,351, rent of $10,134 and filing fees of $12,973.

The Company recorded a loss of $23,262 during the period from March 6, 2019 to June 30, 2019. The net loss is comprised of professional fees of $23,262.

The decrease in the net loss in the quarter ended June 30, 2020 compared to the previous quarters is primarily due to the completion of the IPO transaction and the issuance of stock options being completed in 2019 and minimal activity due to COVID‐19. The Company is incurring minimal activities to maintain operations during the COVID‐19 pandemic.

There were no operations during the first quarter of 2019 as the Company was incorporated on March 6, 2019.

Results of Operations

	Period from March 6, 2019 to December 31, 2019 $
Total assets	365,167
Total revenue	‐
Total expenses	128,863
Net loss	128,863
Basic and diluted net lossper share	1.37

Additional Disclosure for Venture Issuers without Significant Revenue

Since the Company has no revenue from operations, the following is a breakdown of the material costs for the six‐month period ended June 30, 2020 and the fiscal period ending December 31, 2019.

	Period from January 1, 2020 to March 31, 2020 $	Period from March 6, 2019 to December 31, 2019 $
IPO transaction fees	‐	41,920
Share‐basedpayments	‐	60,660
Professional fees	5,647	32,613
Filing fees	10,482	24,273
Rent	6,780	16,914
Office expense	7,289	203

Liquidity and Capital Resources

As at June 30, 2020, the Company had cash of $268,469.

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Outstanding Share Data

As of the date of this MD&A, 6,740,000 common shares were issued and outstanding.

The Company also issued 300,000 agent warrants as part of the Offering which are outstanding.

The Company also granted the directors and officers stock options at closing of the Offering, which will entitle the holders to purchase an aggregate of up to 674,000 common shares at a price of $0.10 per common share for a period of ten years from the date of grant, in accordance with the policies of the TSX‐ V.

The Company’s common shares commenced trading on the TSX Venture Exchange under the trading symbol “LOG‐P.V” on December 19, 2019.

Off‐Balance Sheet Arrangements

The Company has not had any off‐balance sheet arrangements from the date of its incorporation to the date of this MD&A.

Related Party Transactions

As at June 30, 2020, the directors and/or officers of the Company collectively control 3,340,000 common shares of the Company or approximately 49.6% of the total common shares outstanding.

Risks and Uncertainties

The Company’s sole objective is to identify a satisfactory QT. The closing of any proposed Qualifying Transaction is subject to a number of terms and conditions, including completion of due diligence procedures by parties to the transaction and receipt of all required regulatory approvals, and there is no assurance that a transaction will be completed. If the Company does not complete a QT within the time permitted by the Exchange, its common shares could be delisted.

Capital Management

The Company’s objective when managing capital is to maintain its ability to continue as a going concern, in order to provide returns for the shareholders and benefits for other stakeholders. The Company includes equity, comprised of issued common shares, in the definition of capital.

The Company’s primary objective, with respect to its capital management, is to ensure that it has sufficient cash resources to fund the identification and evaluation of potential acquisitions. To secure the additional capital necessary to pursue these plans, the Company may attempt to raise additional funds through the issuance of equity or by securing strategic partners.

The proceeds raised from the issuance of common shares may only be used to identify and evaluate assets or businesses for future investment, with the exception that not more than the lesser of 30% of the gross proceeds from the issuance of shares or $146,100 may be used to cover prescribed costs of issuing the common shares or administrative and general expenses of the Company. These restrictions apply until completion of a QT by the Company as defined under the Policies.

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Risk Disclosures and Fair Values

The Company’s financial instruments, consisting of cash, funds held in trust, and accounts payable and accrued liabilities, approximate fair value due to the relatively short‐term maturities of the instruments. It is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.

Critical Accounting Estimates

These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board and interpretations of the International Financial Reporting Interpretations Committee as at the reporting date.

The Company’s significant accounting policies are summarized in Note 3 of the audited financial statements for the period ended December 31, 2019.

Subsequent Event

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

Future Changes in Accounting Policies

The future changes in accounting policies are summarized in Note 2 of the condensed interim unaudited financial statements for the period ended June 30, 2020.

Additional Information

Additional information about the Company can also be found on SEDAR at www.sedar.com.

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