Highlander Silver Corp. — Interim / Quarterly Report 2020

Feb 14, 2020

LIDO MINERALS LTD.

(formerly Commonwealth Cannabis Corp.)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE COMPANY’S FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THREE MONTHS ENDED DECEMBER 31, 2019

February 14, 2020

This Management Discussion and Analysis (“MD&A”) of Lido Minerals Ltd.(formerly, Commonwealth Cannabis Corp.) (“Lido” or the “Company”) has been prepared by management as of February 14, 2020 and should be read together with the quarterly financial statements and related notes for the period ended December 31, 2019 which are prepared in accordance with International Financial Reporting Standards (“IFRS”). Additional information regarding the Company can be found on SEDAR at www.sedar.com. All of the following amounts are expressed in Canadian dollars unless otherwise stated.

FORWARD LOOKING STATEMENTS

The information set forth in this MD&A contains statements concerning future results, future performance, intentions, objectives, plans and expectations that are, or may be deemed to be, forwardlooking statements. These statements concerning possible or assumed future results of operations of the Company are preceded by, followed by or include the words ‘believes,’ ‘expects,’ ‘anticipates,’ ‘estimates,’ ‘intends,’ ‘plans,’ ‘forecasts,’ or similar expressions. Forward-looking statements are not guarantees of future performance. These forward-looking statements are based on current expectations that involve numerous risks and uncertainties, including, but not limited to, those identified in the Risks Factors section. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate. These factors should be considered carefully, and readers should not place undue reliance on forward-looking statements. The Company may not provide updates or revise any forward-looking statements, except those otherwise required under paragraph 5.8(2) of NI 51-102, whether written or oral that may be made by or on the Company's behalf.

Overall Performance

Lido Minerals Ltd. (formerly Commonwealth Cannabis Corp.) was incorporated as 1093684 B.C. Ltd. (the "Company" or “Lido”) on October 19, 2016 under the laws of British Columbia, Canada. On February 11, 2020 the Company changed its name to Lido Minerals Ltd. The Company’s head office and registered office is located at 600 – 1090 West Georgia Street, Vancouver, BC V6E 3V7.

The Company is a publicly reporting issuer in the Provinces of British Columbia and Alberta. The Company currently operates in the cannabis sector. The Company intends to change its business to exploration and evaluation of mineral properties and intends to file a prospectus with the Canadian Securities Exchange as a resource issuer.

SELECT ANNAUL INFORMATION AND RESULTS OF OPERATIONS

As at December 31, 2019, the Company had total assets of $813,526 (2018: $398,730). As at December 31, 2019, the Company did not have any non-current liabilities (2018: $nil).

For three months ended December 31, 2019, the Company reported a net loss of $52,162 (2018: $51,611). The losses for the three months ended December 31, 2019 comprised of general and administrative fees of $49,719 (2018, $33,810), professional fees of $2,443 (2018: $17,801).

SUMMARY OF QUARTERLY RESULTS

The Company’s results of operations for previous eight quarters have been presented in the table below.

	2019201920192019$(52,162)$(244,892)$(36,279)$(101,936)$(0.00)$(0.06)$(0.00)$(0.01)
Net income (loss)Basic and diluted earnings (loss) per share	2018201820182018
	$51,611$(14,233)$(18,456)-$(0.34)$(7.20)$(0.05)-

2

LIQUIDITY AND CAPITAL RESOURCES

The Company reported working capital of $812,678 at December 31, 2019 and cash of $660,837. Current liabilities as at December 31, 2019 consisted of accounts payable of $848.

On January 31, 2019 the Company issued 8,552,000 common shares at $0.10 per share for total proceeds of $855,200.

Special Warrants

On October 1, 2018, the Company completed a non-brokered private placement of 2,332,000 Special Warrants of the Company at a price of $0.20 per Special Warrant for total proceeds of $466,400.

On February 4, 2019 all outstanding warrants were exercised, for no further consideration, into 2,332,000 of Company’s common shares.

The Company may continue to have capital requirements in excess of its currently available resources. In the event the Company’s plans change, its assumptions change or prove inaccurate, or its capital resources in addition to projected cash flow, if any, prove to be insufficient to fund operations, the Company may be required to seek additional financing. There can be no assurance that the Company will have sufficient financing to meet its future capital requirements or that additional financing will be available on terms acceptable to the Company in the future.

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not utilize off-balance sheet arrangements.

RELATED PARTY TRANSACTIONS

During the period ended December 31, 2019, the Company paid the following advisory and consulting fees:

• $6,000 (2018: $3,000) to Lucas Birdsall, the CFO and director of the Company;

• $1,500 (2018: $Nil) to Patrick O’Flaherty, an independent director of the Company;

• $16,000 (2018: $Nil) to Obsydia Holdings Ltd. A corporation controlled by Wayne Soo, a Director of the Company; and

• $Nil (2018: $1,000) to a former director.

At December 31, 2019, the Company prepaid $8,400 (2018: $Nil) to Obsydia Holdings Ltd., a corporation controlled by Wayne Soo, a Director of the Company, which is included in prepaid expense.

CRITICAL ACCOUNTING ESTIMATES

Not applicable for Venture Issuers.

10

FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS

The carrying amounts of cash and accounts payable approximate fair value because of the short-term maturity of these items.

Investments

On August 8, 2019, the Company subscribed to 1,000,000 units of Champignon Brands Inc. (“Champignon”), a private company, for cash consideration of $100,000. Each unit consists of one common share and one half of one share purchase warrant. Each whole warrant is exercisable into one common share at $0.15 per share for a period of three years. At December 31, 2019, the fair value of this investment was $125,000, which was based on the fair value of recent share subscriptions by Champignon

MANAGEMENT’S RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENTS

The information provided in this report as referenced from the Company’s consolidated financial statements for the referenced reporting period is the sole responsibility of management. In the preparation of the information along with related and accompanying statements and estimates contained herein, management uses careful judgement in assessing the values (or future values) of certain assets or liabilities. It is the opinion of management that such estimates are fair and accurate as presented.

OTHER REQUIREMENTS

Summary of Outstanding Securities as at February 14, 2020

Authorized: Unlimited number of common shares without par value.

Issued and outstanding: 11,035,054 Common Shares

10