Kelly Ventures Ltd.

(the “Company” or “Kelly”)

MANAGEMENT’S DISCUSSION AND ANALYSIS

For the Nine Months Ended September 30, 2022

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 September 30, 2022 and the audited financial statements for the year ended December 31, 2021. The information contained within this MD&A is current to November 29, 2022. 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.

The Company’s head office address is Suite 615 – 800 West Pender Street, Vancouver, BC, V6C 2V6. The registered and records office address is 10[th] Floor - 595 Howe Street, Vancouver, BC, V6C 2T5.

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 TSX-V policies.

As Ebers has not yet completed its audited financial statements for the years ended March 31, 2020, 2021 and 2022, as required to complete the Filing Statement for the TSX-V, the Company and Ebers have agreed to extend the outside date for closing the definitive amalgamation agreement to September 30, 2022. Ebers confirms that it has made some management changes and intends to advance the QT within the extension period.

Updated TSX-V Policy 2.4 – Capital Pool Companies

On July 29, 2021, at the Annual General and Special Meeting of the Company, the shareholders passed four ordinary resolutions voted on by “disinterested shareholders” (such that none of the Company’s insiders, or their associates and affiliates, were entitled to vote on such resolutions) to align the Company with the provisions of the updated TSX-V Policy 2.4 – Capital Pool Companies (“Updated Policy 2.4”) which was revised effective January 1, 2021.

The four resolutions passed are as follows:

removed the applicability of section 14.13 of the past TSX-V Policy 2.4 and adopted the current provisions of Updated Policy 2.4, thereby removing the requirement of the Company to complete a Qualifying Transaction within 24 months of its date of listing on the TSX-V, and removing the associated consequences of delisting, or transfer to NEX and cancellation of certain seed shares held by insiders;
amended the Company’s Escrow Agreement by adopting certain permitted changes provided by the provisions of Updated Policy 2.4, including changes to the escrow release schedule whereby the length of the term of the escrow will be reduced from 36 months to 18 months. Once final TSX-V approval has been obtained to the Qualifying Transaction, the Company will also be clear to file its “Qualifying Transaction” (as defined in TSX-V Policy 2.4) with Ebers Tech Inc. (“Ebers”), subject to completion of any concurrent financing and meeting the other conditions of the TSX-V towards obtaining final TSX-V approval of the Qualifying Transaction;
approved the ability to pay finder’s fees, if applicable and subject to certain conditions, to Non-Arm’s Length Parties (as defined by the policies of the TSX-V); and

approved certain amendments to the Company’s stock option plan to, among other things, become a “10% rolling” plan prior to the Company completing a Qualifying Transaction.

Financing Activity During the Nine Months Ended September 30, 2022

There was no financing activity during the nine months ended September 30, 2022.

Results of Operations

Summary of Quarterly Results

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

incorporated:
	30-Sep-22	30-Jun-22	31-Mar-22	31-Dec-21	30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20
Loss & comprehensive loss	$(11,461)	$(11,535)	$(10,250)	$(10,227)	$(5,335)	$(8,936)	$(11,018)	$(3,706)
Lossper share	$ -	$ -	$ -	$ -	$ -	$ -	$(0.01)	$ -

For the Three Months Ended September 30, 2022

For the three months ended September 30, 2022, the Company incurred a loss of $11,461 (2021 – $5,553). The increase was due to higher professional fees due to an increase in legal fees related to the proposed Qualified Transaction. This increase was offset by listing and filing fees due to the timing of the annual general meeting which is delayed this year. Management expects costs to continue to increase now that the qualifying transaction process is underway.

Liquidity and Capital Resources

At September 30, 2022 the Company had cash of $95,489 (December 31, 2021 - $128,549) and a working capital surplus of $90,065 (December 31, 2021 – $123,311).

Cash decreased by $33,060 during the nine months ended September 30, 2022 (2021 – $24,993) mainly due to the loss for the period of $33,246. The previous year’s decrease was almost entirely due to the loss for the quarter of $25,289. 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.

Management did not receive any compensation during the nine months ended September 30, 2022 nor for the nine months ended September 30, 2021. Administration fees of $6,379 (2021 - $6,379) were charged by an entity controlled by the President of the Company. Consulting fees related to the preparation of the audited and quarterly financial statements of $4,200 (2021 - $Nil) were charged by an entity controlled by a director of the Company.

As at September 30, 2022, $Nil (December 31, 2021 - $1,352) was due to a private company controlled by the President and CEO 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.

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. Upon approval of the Updated Policy 2.4 described above, the Plan became a “10% rolling” plan.

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

Outstanding Share Data – November 29, 2022

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 25% upon the issuance of notice of final acceptance of a Qualifying Transaction by the Exchange, with the balance in three equal tranches of 25% every six months thereafter over a period of 18 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.

As of September 30, 2022, and December 31, 2021 the Company has not generated any revenues and has incurred losses of $177,933 (December 31, 2021 - $144,687) 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 Company’s business financial condition and results of operations may be further negatively affected by economic and other consequences from Russia’s military action against Ukraine and the sanctions imposed in response to that action in late February 2022. While the Company expects any direct impacts of the pandemic and the war in the Ukraine to the business to be limited, the indirect impacts on the economy and on other industries in general could negatively affect the business and may make it more difficult for it to raise equity or debt financing. There can be no assurance that the Company will not be impacted by adverse consequences that may

be brought about on its business, results of operations, financial position and cash flows in the future.

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 forwardlooking statements. The Company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

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Kelly Ventures Ltd. Management Reports 2022

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