Kelly Ventures Ltd. — Management Reports 2021

May 10, 2021

KELLY VENTURES LTD.

(the “Company” or “Kelly”)

MANAGEMENT’S DISCUSSION AND ANALYSIS

For the Three Months Ended March 31, 2021

Management’s discussion and analysis (“MD&A”) of the financial condition of the Company should be read in conjunction with the unaudited condensed interim financial statements for the period ended March 31, 2021 and the audited financial statements for the year ended December 31, 2020. The information contained within this MD&A is current to May 10, 2021. The financial statements have been prepared in accordance with International Financial Reporting Standards with the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business.

Incorporation and Overall Performance

On November 2, 2016, Kelly was incorporated under the laws of the Province of British Columbia and is classified as a Capital Pool Company (“CPC”) as defined in the TSX Venture Exchange Policy 2.4. On December 21, 2018, the Company completed its initial public offering (“IPO”) of a total of 2,000,000 common shares, at a price of $0.10 per share, for aggregate gross proceeds of $200,000. The TSX Venture Exchange (the “TSX-V”) accepted the Company’s listing application and the Company’s common shares resumed trading on the TSX-V on December 27, 2018 under the trading symbol “KKL.P”.

As a CPC, the principal business of the Company is the identification and evaluation of assets or a business and once identified or evaluated, to negotiate an acquisition of or participation in a business (the “Qualifying Transaction” or “QT”) subject to receipt of shareholder approval, if required, and acceptance by regulatory authorities. Where an acquisition or participation is warranted, additional funding may be required. The ability of the Company to fund its potential future operations and commitments is dependent upon the ability of the Company to obtain additional financing. There is no assurance that the Company will complete a Qualifying Transaction within twenty-four months from the date the Company’s shares were listed on the TSX-V, at which time the TSX-V may suspend or de-list the Company’s shares from trading.

The Company’s head office address is Suite 615 – 800 West Pender Street, Vancouver, BC, V6C 2V6. The registered and records office address is Suite 2900 - 595 Burrard Street, Vancouver, BC, V7X 1J5.

2

Proposed Qualifying Transaction

In December 2020, the Company signed a Letter of Intent (“LOI”) dated December 18, 2020, pursuant to which the Company will acquire all of the outstanding shares of Ebers Tech Inc. (“Ebers”). The parties intend to complete a business combination or other similarly structured transaction which will constitute a reverse take-over of KKL. The Proposed Transaction is intended to be an arm’s length Qualifying Transaction (the “Qualifying Transaction”) for the Company as defined under TSXV policies. Please see the news release filed on www.Sedar.com dated December 21, 2020 for full details of the LOI.

Financing Activity During the Three Months Ended March 31, 2021

There was no financing activity during the three months ended March 31, 2021.

Results of Operations

Summary of Quarterly Results

The following are the results for the most recent quarters (periods) since the Company was incorporated:

incorporated:
	31-Mar-21	31-Dec-20	30-Sep-20	30-Jun-20	31-Mar-20	31-Dec-19	30-Sep-19	30-Jun-19
Loss & comprehensive loss	**$(11,018) **	**$(3,706) **	**$(11,027) **	**$(5,323) **	**$(8,493) **	**$(3,194) **	**$(3,742) **	$(15,953)
Lossper share	$ -	$ -	**$(0.01) **	$ -	$ -	$ -	$ -	$ -

For the Three Months Ended March 31, 2021

The Company incurred a loss of $11,018 (2020 – $8,493) for the three months ended March 31, 2021. The increase was due to higher listing and filing fees due to the timing of the payment of the annual Sedar filings. This year, the fees were paid in March whereas in 2020, they were paid in April. Other expenses were fairly consistent year over year. Management expects them to remain at these levels until the qualifying transaction process is initiated.

3

Liquidity and Capital Resources

At March 31, 2021 the Company had cash of $159,272 (December 31, 2020 - $159,272) and a working capital surplus of $147,809 (December 31, 2020 – $158,827).

Cash decreased by $10,944 during the three months ended March 31, 2021 (2020 – $8,491) mainly due to the loss for the period of $11,018 (2020 - $8,493). The Company will require additional capital resources to complete a QT. There is no guarantee that the Company will be able to complete a QT, or to secure additional financings in the future at terms that are acceptable to it (or at all).

Related Party Transactions

Related parties include the Board of Directors, close family members and enterprises which are controlled by these individuals as well as certain persons performing similar functions.

As at March 31, 2021, $nil was outstanding to/from the Company’s directors, officers, and entities related to the Company’s directors and officers. Management did not receive any compensation during the three months ended March 31, 2021 nor for the three months ended March 31, 2020. Administration fees of $2,126 (2020 - $2,126) were charged by an entity controlled by the President of the Company.

Off Balance Sheet Arrangements

The Company has not entered into any off balance sheet arrangements, other than previously disclosed, that have, or are reasonably likely to have, an impact on the current or future results of operations or the financial condition of our Company.

Accounting Policies

Please refer to note 3 of the financial statements for details on Significant Accounting Policies. The Company’s financial statements include the activity of identifying and evaluating potential qualifying transactions. The Company’s continuing operations, as intended, are dependent upon its ability to negotiate and complete a Qualifying Transaction. Management considers the policy dealing with stock-based compensation to be of primary importance to the understanding of the Company’s financial statements.

4

Accounting for Stock Options

The Company has adopted an incentive stock option plan (the “Plan”), whereby it can grant options to directors, officers, employees, and consultants of the Company. Upon completion of the IPO, the maximum number of shares that may be reserved for issuance under the Plan will be limited to 10% of the issued common shares of the Company at any time, provided that until completion of the Qualifying Transaction, not more than 400,000 options may be granted in the aggregate. The exercise price of options granted under the Plan shall not be less than the price of the Company’s common shares on the day proceeding the day the options are granted, less any discount permitted by the Exchange to a minimum of $0.10 per share.

As of the date of this report, there are no stock options issued or outstanding.

Outstanding Share Data – May 10, 2021

Number Common shares, issued and outstanding 4,191,150

Since completion of the IPO, 2,000,000 shares have been held in escrow which will be released pro-rata to the shareholders as to 10% upon the issuance of notice of final acceptance of a Qualifying Transaction by the Exchange, with the balance in six equal tranches of 15% every six months thereafter over a period of 36 months.

Additional Disclosure for Venture Issuers without Significant Revenues

Additional information relating to the Company can be found on the SEDAR website at www.sedar.com.

Going Concern of Operations

The Company has prepared its financial statements in accordance with International Financial Reporting Standards (“IFRS”) with the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business rather than through a process of forced liquidation. The financial statements do not include adjustments to amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue operations.

5

As of March 31, 2021, and December 31, 2020 the Company has not generated any revenues and has incurred losses of $120,556 (December 31, 2020 - $109,538) since inception. The Company’s continued existence and plans for future growth depend on its ability to obtain additional capital.

Since March 2020, there has been a global outbreak of COVID-19. The actual and threatened spread of the virus globally has had a material adverse effect on the regional economies in which the Company operates and could continue to result in negative impacts on the stock market, including trading prices of the Company’s shares, and the ability to raise capital and could impact the Company’s operations.

The above material uncertainties raise significant doubt about the Company’s ability to continue as a going concern. Although the Company’s financial statements have been prepared on a going concern basis, the Company’s continuing operations are dependent upon its ability to obtain adequate financing through debt or equity issuance.

Approval

The Board of Directors of the Company has approved the disclosure contained in this MD&A. A copy of this MD&A will be provided to anyone who requests it.

Forward-Looking Statements

This report contains forward-looking statements, including statements regarding the future success of our business, exploration and development strategies and future opportunities. Forward-looking statements include, but are not limited to, statements concerning estimates of expected capital expenditures, statements relating to expected future production and cash flows, statements relating to the continued advancement of the Company’s exploration, and development projects, and other statements which are not historical facts. When used in this document, the words such as “could”, “plan”, “estimate”, “expect”, “intend”, “may”, “potential”, “should”, and similar expressions are forward-looking statements. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that can cause actual results to differ from these forward-looking statements include the potential that the Company’s projects will experience technological and mechanical problems, changes in political conditions, changes in the availability to obtain project financings and other risks. Forward-looking statements are based on the opinions and estimates of management at the date that the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in forward-looking statements. The Company undertakes no obligation to update forwardlooking statements if circumstances or management’s estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.