Magna Mining Inc. - Management Reports 2022

Magna Mining Inc. (formerly CT Developers Ltd.)

(An Exploration Stage Company) Management Discussion and Analysis For the year ended December 31, 2021

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

INTRODUCTION

This management discussion and analysis of financial condition and results of operations (" MD&A ") focuses upon the activities, results of operations, liquidity and capital resources of Magna Mining Inc. (formerly CT Developers Ltd.) (the " Company " or " Magna ") for the year ended December 31, 2021. In order to better understand this MD&A, it should be read in conjunction with the audited financial statements for the years ended December 31, 2021 and 2020, and the related notes thereon. The Company's financial statements are prepared in accordance with International Financial Reporting Standards (" IFRS ") in Canada. This MD&A is current to April 19, 2022, and expressed in Canadian dollars unless otherwise stated.

FORWARD LOOKING STATEMENTS

Information set forth in this MD&A may involve forward-looking statements under applicable securities laws. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address expected future business and financial performance, and often contain words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions. All statements, other than statements of historical fact, included herein, such as statements about the size and timing of future exploration on, and the development of, the Company's properties, are forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the Company's actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: the need for additional financing; operational risks associated with mineral exploration; fluctuations in commodity prices; title matters; environmental liability claims and insurance; reliance on key personnel; the volatility of the Company's common share price and volume and other reports and filings with the TSX Venture Exchange and applicable Canadian securities regulators. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date such statements are made and the Company undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable securities laws. There can be no assurance that such statements will prove to be accurate, and future events and actual results could differ materially from those anticipated in such statements. Investors are cautioned against attributing undue certainty to forward-looking statements.

This MD&A has been prepared in accordance with the requirements of National Instrument 43-101 "Standards of Disclosure for Mineral Projects" (" NI 43-101 ") and National Instrument 51-102 "Continuous Disclosure Obligations."

The technical information in this document has been reviewed and approved by Mynyr Hoxha, Ph.D., P.Geo., the Company’s Vice President of Exploration. Dr. Hoxha is a qualified person under Canadian National Instrument 43-101.

OVERVIEW

Description of Business

Magna is a mineral exploration and development company and is engaged in the exploration of mineral properties. Its assets consist of the Shakespeare Nickel Project, located near Sudbury, Ontario, Canada, and the Shining Tree Ni-Cu-PGE project, located 100-km north of Sudbury, Ontario, Canada.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

On May 4, 2021, the Company completed a previously announced reverse-takeover Qualifying Transaction with Magna Mining (Canada) Corp. (formerly Magna Mining Corp.) and started trading on the TSX Venture Exchange (the “TSXV”) on May 11, 2021, following the issuance of the Final Exchange Bulletin by the TSXV with respect to Magna Mining Inc’s (forrmerly CT Developers Ltd.) Qualifying Transaction.

Following the closing, the board of directors of the Company is comprised of Jason Jessup, Derrick Weyrauch, Vernon Baker, Carl DeLuca and John Seaman, and officers of the Company are Jason Jessup (Chief Executive Officer), Derrick Weyrauch (Interim Chief Financial Officer) and Paul Fowler (Senior Vice President and Corporate Secretary).

HIGHLIGHTS DURING AND SUBSEQUENT TO THE YEAR ENDED DECEMBER 31, 2021

Exploration

On March 31, 2021, the Company announced the filing of an independent technical report for the Shakespeare Project prepared in accordance with the requirements of National Instrument 43-101.
On May 20, 2021, the Company announced that it had achieved carbon neutrality in 2021 through its support of the Niagara Escarpment Forest Carbon Project.
On May 26, 2021, the Company announced that it had commenced the planned 9,000m Phase I drilling program at the Shakespeare Project.
On June 8, 2021, the Company announced that it had signed a definitive agreement to acquire a 50% interest in eight patented claims in Baldwin Township comprising 132.8 hectares of land. Seven claims comprise both surface and mining rights, while the remaining claim is restricted to mining rights only. The 50% interest in these claims was acquired for $80,000 in cash and the vendor will retain a 1% Net Smelter Return (NSR) royalty.
On June 24, 2021, the Company reported drill results which returned an intersect of 0.51% Nickel Equivalent (“Ni Eq”) over 33.8 metres in the Gap Zone at the Shakespeare Project.
On August 3, 2021, the Company announced the appointment of Dr. Mynyr Hoxha to the position of Vice President of Exploration. Dr. Hoxha is a Professional Geoscientist with more than 30 years of mining and exploration industry experience, most recently serving as Chief Geologist at the Young Davidson Mine for Alamos Gold since 2015.
On August 17, 2021, the Company reported progress on the exploration drilling program, with 5,203 meters drilled to date from a planned program of 9,000 meters at the Shakespeare Project.
On September 14, 2021, the Company reported high grade surface samples on the Baldwin Patents portion of the Shakespeare Project. Grab samples returned values as high as 13.2% copper with 1.8 g/t gold as well as 7.1% copper with 6.2 g/t gold with anomalous cobalt and silver values.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

On September 20, 2021, the Company reported drill results from the first two diamond drill holes that were designed to test a portion of the P-4 target, located 5 km to the east and on strike of the past producing Shakespeare Mine stratigraphy. Portions of the drill holes returned a zone grading 0.58% Ni, 0.84% Cu, 0.04% Co, and 2.64g/t TPM over 0.42m, a zone of semi-massive sulphides grading 1.16% Ni, 0.10% Cu, 0.06% Co and 0.78 g/t TPM over 0.21m, and a zone grading 0.46% Ni, 1.32% Cu, 0.03% Co and 1.64 g/t TPM over 0.53m.
On November 4, 2021, the Company reported drill results which returned an intersect of 0.84% Ni Eq over 52.57 metres in the S13/Gap Zone at the Shakespeare Project.
On December 1, 2021, the Company announced that the next phase of exploration at the Shakespeare Project would commence in early January. The initial winter exploration program consists of 4,500m of drilling which will target the new P-4 nickel discovery and the past producing Spanish River Copper Mine, both located approximately 5km from the Shakespeare Mine.
On January 5, 2022, the Company announced positive assay results from a further nine holes drilled at the Shakespeare Mine during the 2021 drilling program. Highlights from this batch of assay results include wide Gap Zone intersections which support the thesis that the West and East Zones are connected not only near surface, but also at depth.
On January 31, 2021, the Company announced the results of the 2022 Feasibility Study for the Shakespeare Nickel Project. Highlights include: Base Case results demonstrate a Pre-Tax NPV6% of $221 million, IRR of 27.2%, and a 3.4-year payback, and a Post-Tax NPV6% of $140 million, IRR of 21.5% and 3.5 year post-tax payback period based on metal prices of US$ 8.50/lb. nickel, US$ 3.95/lb. copper, US$ 24/lb. cobalt, US$ 950/oz platinum, US$ 1,750/oz palladium and US$ 1,600 gold and an exchange rate of 0.77 US$:CDN.

Nickel Equivalent (NiEq ) grades are calculated based on metal prices of $6.25/lb Ni, $2.80/lb Cu, $31.00/lb Co, $950/oz Pt, $900/oz Pd and $1,250.00/oz Au, and metal recoveries of 76.4% for Ni, 95.9% for Cu, 71% for Co, 74.8% for Pt, 42.4% for Pd and 38.4% for Au.

Consulting agreement

On October 26, 2020, the Company issued 3,000,000 common share purchase Warrants (the "Magna Warrants"), to consultants as consideration for services, on terms which include: (i) a vesting provision such that the Magna Warrants shall not vest unless a Go Public Transaction and prior to or concurrent with the closing of the Go Public Transaction, an offering of Units of the Company, with each Unit comprised of one common share and one half of one common share purchase warrant, for minimum aggregate gross proceeds of $5,000,000 are closed at least two business days before the expiry of the Magna Warrants and (ii) exercise of the Magna Warrants will be conditional upon, among other things, the Warrant holders entering into lock up agreements.

Each Magna Warrant is exercisable to acquire, subject to adjustment as provided for in the warrant certificate evidencing such Magna Warrants, one Magna Share at a price of $0.10 per share at any time prior to October 26, 2022. On completion of the Go Public Transaction, each Magna Warrant issued to the Consultants would be exchanged for CT Exchange Warrants on the basis of the Exchange Ratio (such warrants to be referred to as Resulting Issuer Warrants following the Closing). Based on the existing terms of the Magna Warrants, after giving effect to the Exchange Ratio, the Consultants would receive an

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

aggregate of 4,875,000 Resulting Issuer Warrants in connection with the transaction, each Resulting Issuer Warrant entitling the holder thereof to acquire one Resulting Issuer Share at an effective exercise price of $0.06 per share. However, prior to and as a condition to completion of the Arrangement, as required by the TSX Venture Exchange, the Company amended the warrant certificates issued to the Consultants such that an aggregate of no more than 4,209,405 Resulting Issuer Warrants will be issued to the Consultants, with an effective exercise price of $0.40 per Resulting Issuer Share.

The Company recognized deferred transaction costs of $Nil as at December 31, 2021 (December 31, 2020 - $263,018) within other assets, relating to the vested portion of the warrants granted in anticipation of the Go Public transaction and $7,000,500 Subscription Receipts financing transactions.The fair value ascribed to the Warrants is $863,781.

Qualifying Transaction

On October 26, 2020, CT entered into an Arrangement (the “Arrangement”) agreement with Magna Mining (Canada) Corp. (“MMCC”), whereby:

a) CT would acquire all of the issued and outstanding shares of MMCC; and b) CT would change it’s name to “Magna Mining Inc.” (“MMI”)

On February 10, 2021, CT and MMCC finalized a definitive agreement for the transaction.

On May 4, 2021, the Arrangement was completed and the former shareholders of MMCC acquired control of CT (now Magna Mining Inc.).

MMCC is deemed to be the acquirer and CT is deemed to be the acquiree for accounting purposes.

The purchase price is the cost to acquire CT’s share capital at the fair value at the time of the transaction. The fair value is calculated as $801,845, being the cost of acquiring 2,004,612 shares at $0.40 per share, being the fair value of MMCC concurrent financing, after giving effect to the 1.625 conversion ratio. All CT stock options were exercised immediately prior to completion of the Arrangement and therefore no fair value was assigned to stock options.

The assets and liabilities of CT are included in the consolidated statement of financial position and are presented at their fair value, which is equal to their carrying value. The pre-acquisition equity of CT was eliminated on consolidation. The excess of the amount paid over the fair value of the net assets acquired, estimated at $750,959 is charged to profit or loss as a listing expense.

The excess was calculated as follows:

stimated at $750,959 is charged to profit or loss as a listing expense. he excess was calculated as follows:
Fair value of consideration
2,004,612 common shares at $0.40 per share	$	801,845
Total consideration		801,845
Net assets acquired
Cash		75,441
Trade and other payables		(24,555)
Net assets		50,886

Excess of consideration over net assets acquired	$	750,959

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

The share price of $0.40 was based on the concurrent financing price of $0.65 adjusted for the preconversion price ratio of 1.625.

Sale of Fox Mountain Property

On February 5, 2020, Magna completed the sale of all of the right, title and interest in and to the mining claims located in the Disraeli Lake Area (the " Fox Mountain Property ") pursuant to the terms of the mining claim acquisition agreement (the " Fox Mountain Acquisition Agreement ") dated February 5, 2020.

As total consideration for the acquisition of the Fox Mountain Property, the purchaser agreed to pay to Magna the sum of $5,000. The Fox Mountain Acquisition Agreement also contemplates the payment to Magna of a $1,000,000 discovery bonus, in cash or such number of shares of the purchaser (or part cash and part shares) equivalent in value to $1,000,000, payable upon the completion of a resource estimate or calculation prepared in accordance with NI 43-101 of at least one million ounces of palladium (or palladium equivalent being based on the three-year trailing average dollar value of platinum, gold, copper, nickel, and cobalt estimated as a portion of the three-year trailing average dollar value of palladium) on the Fox Mountain Property at any time after the Closing Date (as defined in the Fox Mountain Acquisition Agreement), but before the eighth anniversary of such Closing Date.

In connection with the sale, Magna also retained a 1.0% NSR royalty interest in the property, 50% (0.5%) of which can be bought back by the purchaser at any time after the Closing Date but prior the eighth anniversary of the Closing Date for $1,000,000.

Stock Options

On November 6, 2020, Magna issued 1,500,000 stock options.

1,000,000 stock options have a term of 3-years, vest immediately and have an exercise price of $0.35 per common share.

200,000 stock options have a term of 3-years, vest immediately and have an exercise price of $0.45 per common share.

300,000 stock options have a term of 3-years, vest one-third immediately and one-third annually thereafter and have an exercise price of $0.50 per common share.

On October 23, 2020, 97,000 stock options were exercised, at a strike price of $0.001 per common share, for proceeds of $97.

On May 28, 2021, the Company granted 925,000 stock options to certain employees, directors, and consultants. 500,000 of these stock options have a term of 5-years, vest immediately and have an exercise price of $0.50 per common share, and 425,000 stock options have a term of 5-years, vest one-third immediately and one-third annually thereafter and have an exercise price of $0.50 per common share.

On December 23, 2021, the Company granted 575,000 stock options to certain directors and officers. The options have a term of 5-years, vest immediately, and have an exercise price of $0.40 per common share.

Restricted Share Units (“RSU”)

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

During the year ended December 31, 2021, the directors of the Company approved an RSU Plan, which contemplates the granting of RSUs to directors, senior officers, employees and consultants of the Company and its subsidiaries. The RSU Plan is intended to provide an incentive to eligible persons to acquire a proprietary interest in the Company, to continue their participation in the affairs and to increase their efforts on its behalf. The RSU Plan is administered by the Board of the Company.

The aggregate number of Shares reserved for issuance under the Stock Option Plan and RSU plan may not exceed 10% of the issued and outstanding common shares on the date of grant.

Details of the RSUs issued during the period are as follows:

On May 28, 2021, the Company granted 93,000 RSUs with a fair value of $46,500 to certain employees. The RSUs will fully vest three years from the date of the grant.

On July 27, 2021, the Company granted 225,000 RSU’s with a fair value of $81,000 to the new Vice President of Exploraion. The RSUs will fully vest three years from the date of the grant.

MINERAL PROPERTIES

The Company's primary mineral property is the Shakespeare Project.

All of the Company's properties are located near Sudbury, Ontario, Canada.

Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee their titles. Property title may be subject to unregistered prior agreements or transfers and may be affected by undetected defects.

The Company is required to make a $24,000 per year advance royalty payment in order to maintain certain property agreements in good standing, as outlined below. The Company is also required to make statutory license and property tax expenditures each year to maintain its properties in good standing.

Shakespeare Project

The Shakespeare Project is currently comprised of 29 patented claims, 3 leased claims and 787 mining claims within Dunlop, Porter, Shakespeare, Hyman and Baldwin Townships, and covers an area of 18,074.94 ha. Magna currently has a 100% interest in most of the Shakespeare Project, with 83.9% ownership of a joint venture on certain claims, leases, and patents surrounding the Shakespeare Mine. The 8 Baldwin patents are 50% owned by Ursa Major Minerals.

During the financial year ended January 31, 2011, the Company’s subsidiary, Ursa, declared commercial production at the Shakespeare Mine. Subsequently, it suspended production and the mine remains on care and maintenance.

Over the course of 2020, Magna acquired 291 mining claims.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

During the year ended December 31, 2021, the Company entered into a transaction with a third party whereby $282,500 was provided to the Company for use in an exploration program targeting the Palladium Valley target area, located in the north central portion of the Shakespeare property. The Exploration program is to be completed prior to May 1, 2022. In exchange, the Company is to make available to the third party all records and data with respect to the exploration program, and the third party will have the exclusive and discretionary right to enter into a definitive formal exploration and option agreement within 30 days of the end of the exploration period. The funds remaining to be spent as at December 31, 2021 is $260,670 (2020 - $nil).

Spanish River Option

On November 2, 2020, Magna entered into an option to purchase agreement with 2060014 Ontario Inc. to acquire 100% of 7 claim units located in Baldwin Township, Ontario. The terms of the agreement were as follows:

within 10 days from the date of signing: $6,000 cash and 25,000 shares of Magna. The cash balance has been paid.
before the 1[st] anniversary date of signing: $14,000 cash and 25,000 shares of Magna. The cash balance has been paid.
before the 2[nd] anniversary date of signing: $25,000 cash and 25,000 shares of Magna; and
before the 3[rd] anniversary date of signing: $30,000 cash and 25,000 shares of Magna.

Magna will also be required to complete cumulative exploration expenditures totaling $100,000 prior to the third anniversary date of signing.

2060014 Ontario Inc. will retain a 1.5% NSR royalty, of which Magna can repurchase 50% (0.75%) for $1,000,000 at anytime, and is entitled to receive a payment of $200,000 in cash or Common Shares within 30 days of the start of Commercial Production (as defined in the option to purchase agreement).

Shining Tree Nickel Project

Magna has a 100% interest in a nickel-copper deposit located near Shining Tree, Ontario. The Shining Tree Nickel Project is located in Fawcett Township, 110 km north of Sudbury, Ontario and consists of certain claims covering an area of approximately 1,600 acres.

Magna has not conducted any exploration work on the Shining Tree Nickel Project since acquiring the project in 2017. There are no plans for exploration work on the property in 2022.

OUTLOOK

The Company expects to obtain financing in the future primarily through further equity financing. There can be no assurance that the Company will succeed in obtaining additional financing, now or in the future. Failure to raise additional financing on a timely basis could cause the Company to suspend its operation and eventually to forfeit or sell its interest in its exploration and evaluation assets.

In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or ability to raise funds.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

REVIEW OF OPERATIONS AND FINANCIAL RESULTS

Years ended December 31, 2021 and 2020

During the year ended December 31, 2021, the Company reported a net and comprehensive loss of $6,762,966 (2020 - $1,091,074), an increase of $5,671,892. The primary contributors were:

Increased exploration expenditures of $3,771,965 compared to $402,914 in 2020.
$1,255,151 of Listing Costs in relation to the Qualifying Transaction that was completed on May 4, 2021.
Increased share-based compensation of $643,252 compared to $446,519 in 2020.
Increased general and administrative expenses of $569,724 compared to $159,346 in 2020.

Three-months ended December 31, 2021 and 2020

During the three months ended December 31, 2021, the Company reported a net and comprehensive loss of $1,235,143 (2020 - $795,372), an increase of $439,771. The primary contributors were:

Increased exploration expenditures of $667,419 compared to $269,107 in the comparable 2020 period.
Increased general and administrative expenditures of $194,029 compared to $112,069 in the comparable 2020 period.
Increased property maintenance expenditures of $59,251 compared to $822 in the comparable 2020 period.
Professional fees of $38,952 compared to $Nil in the comparable 2020 period.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

Exploration and evaluation expenditures

Magna is an exploration stage company and engages principally in the exploration of resource properties. The Company expenses all direct and indirect costs pertaining to exploration and evaluation of mineral properties in the period in which they are incurred. These direct exploration and evaluation expenditures include such costs as acquisition costs, materials used, surveying costs, drilling costs and payments made to contractors.

Exploration expenditures at the Shakespeare Project, in the year ended December 31, 2021, were primarily due to Electromagnetic (EM) surveys and diamond drilling at Shakespeare.

The Company performed the following work on its properties during the period:

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Three months ended Three months Year ended Dec 31, Year ended Dec 31,
Dec 31, 2021 ended Dec 31, 2020 2021 2020
Shining Tree
Field Work $ - $ - $ - $ 1,350
$ - $ - $ - $ 1,350
Shakespeare Property
Acquisition $ - $ - $ 88,568 $ -
-
Advanced royalty 12,550 24,000 36,550
Assays and surveying 80,527 510 199,513 5,192
Claim maintenance 6,297 12,157 17,448 17,554
Care and maintenance 869 869 1,520
Consulting 42,443 1,683 175,631 21,923
- -
Drilling 97,616 1,711,228
- -
Engineering 94,849 163,777
-
Feasibility update 144,546 427,575 1,520
Field work 112,691 48,152 594,225 119,250
Geophysics 54,707 174,305 335,805 178,305
$ 634,545 $ 249,357 $ 3,738,639 $ 381,814
Spanish River
Acquisition $ 30,250 $ 19,750 $ 30,250 $ 19,750
Assays and surveying 750 - 750 -
Claim Maintenance - - 211 -
Field work 374 - 615 -
- -
Geophysics 1,500 1,500
$ 32,874 $ 19,750 $ 33,326 $ 19,750
Exploration & evaluation expenses $ 667,419 $ 269,107 $ 3,771,965 $ 402,914
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Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

SELECTED ANNUAL FINANCIAL INFORMATION

The following table summarizes selected financial data reported by the Company for the years ended December 31, 2021, 2020, and 2019. The information set forth should be read in conjunction with the consolidated audited financial statements, prepared in accordance with IFRS, and the related notes thereon.

Expenditures in 2021 have increased over prior years due to increased cash available to fund corporate activities. Expenditures in 2020 are comparable to 2019.

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Year ended Year ended Year ended
31-Dec-21 31-Dec-20 31-Dec-19
Exploration and evaluation expenses $ 3,771,965 $ 402,914 $ 524,706
Site maintenance 130,405 101,663 98,433
Corporate general and administrative 569,724 159,346 84,428
Share based payments 643,252 446,519 58,289
Amortization 15,821 2,618 5,566
Net comprehensive loss 6,762,966 1,091,074 814,005
Loss per share - basis and fully diluted 0.12 0.03 0.02
Total assets 7,088,955 2,743,737 910,078
Total liabilities 2,311,375 1,577,701 1,390,134
Shareholders' equity $ 4,777,580 $ 1,166,036 $ (480,056)
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SUMMARY OF QUARTERLY RESULTS

The following summary information is taken from the Company’s quarterly and annual financial reports covering the last eight reporting quarters.

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||||||
|---|---|---|---|---|
|Quarter ended|Quarter ended|Quarter ended|Quarter ended|
|31-Dec-21|30-Sep-21|30-Jun-21|31-Mar-21|
|Exploration and evaluation expenses|$ 667,419|$ 1,690,033|$ 1,122,687|$ 291,826|
|Site maintenance|44,753|26,390|42,925|16,337|
|Corporate general and administrative|121,068|200,357|94,325|153,974|
|Share based payments|254,749|45,043|333,436|10,024|
|Depreciation of equipment|13,343|943|785|750|
|Net comprehensive loss|1,214,514|2,071,455|3,024,869|452,128|
|Total assets|6,988,955|4,987,261|6,964,768|2,214,142|
|Total liabilities|2,211,375|2,013,881|1,964,976|1,340,580|
|Shareholders' equity|$ 4,777,580|$ 2,973,380|$ 4,999,792|$ 873,562|

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Quarter ended Quarter ended Quarter ended Quarter ended
31-Dec-20 30-Sep-20 30-Jun-20 31-Mar-20
Exploration and evaluation expenses $ 269,107 $ 29,127 $ 33,377 $ 71,303
Site maintenance 32,290 17,897 19,682 31,794
Corporate general and administrative 67,706 41,732 8,458 41,450
Share based payments 408,538 13,242 12,369 12,370
Depreciation of equipment 606 558 553 901
Net comprehensive loss 741,176 69,051 58,767 222,080
Total assets 2,743,737 983,706 999,153 1,032,018
Total liabilities 1,577,701 1,322,789 1,272,417 1,258,884
Shareholders' equity $ 1,166,036 $ (339,083) $ (273,264) $ (226,866)
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Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Year ended December 31, 2021

As at December 31, 2021, the Company reported working capital surplus of $4,764,512 (December 31, 2020 – $1,176,454). The increase in working capital was the result of the financings during the period.

Cash used in operating activities during the year ended December 31, 2021 was $5,768,362 (2020 - $395,064). The main cause of this change was increased exploration activities and listing costs in respect of the Qualifying Transaction.

Cash provided by investing activities for the year ended December 31, 2021 was $319,996 (2020 – $(1,379)). Investing activities include cash received on the acquisition of CT, received and utlized related to the exploration advance, as well as cash used towards the purchase of equipment and acquisition of right of use assets.

Cash proceeds generated from financing activities for the year ended December 31 2021, was $9,609,765 (2020 - $1,753,705). The increase primarily was due to the Subscription Receipt financing.

Financing activities

On March 19, 2020, the Company closed a private placement financing pursuant to which a total of 432,248 shares were issued at a price of $0.34 per share, for gross proceeds of $146,301.

On March 19, 2020, the Company closed a private placement financing pursuant to which a total of 325,000 flow through common shares were issued at a price of $0.42 per share, for gross proceeds of $138,000, of which $110,000 was allocated to share capital and $27,984 was allocated to flow through premium. $17,147 of the flow through premium was recognised in other income in 2020. At December 31, 2020, the Company's outstanding commitment to recognise the remaining flow through premum is $53,489. Finder’s fees of 19,500 common shares were paid in connection with this financing at a price of $0.34 per share, for gross aggregate total of $6,600. Legal fees of $10,008 was incurred with respect to the flow-through financing.

On March 19, 2020, the Company settled a related party loan of $194,439 through the issuance of common shares. The Company issued a total of 590,907 common shares at an issue price of $0.34 per share.

On November 2, 2020, the Company issued 40,625 shares of Magna at their fair value of $13,750 in connection with the purchase of the Spanish River Option. See note 8(g).

On November 13, 2020, the Company completed a private placement at a price of $0.31 per common share for gross proceeds of $1,692,500 and issued 5,500,625 common shares. Share issue costs in respect of the issuance amounted to $125,011 including cash finder’s fees of $91,950.

On February 12, 2021, the Company completed a private placement of 17,501,250 subscription receipts (“Subscription Receipts”) at a price of $0.40 per Subscription Receipt for gross proceeds of $7,000,500. Each Subscription Receipt was exchanged, without payment of any consideration in addition to the purchase price, for one common share and one half of one warrant of the Company (“Magna Unit”). Proceeds from shares and warrants are allocated between share capital and warrants on a residual value basis, whereby the fair value of the warrants is determined using a Black Scholes Option Pricing model (as described in note 16) and the fair value of share capital is based on the remaining residual value.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

On May 4, 2021, concurrent with the completion of the Qualifying Transaction (see note 3), Magna Units were exchanged for the underlying 17,501,250 common shares and 8,750,625 warrants and net cash proceeds of $6,426,763 were released from Escrow and provided to the Company.

Subscription Receipt issue costs included agent’s fee of 6% of specific gross proceeds paid in cash of $408,488, legal fees of $129,000, a corporate finance fee of 1.5% payable in Subscription Receipts of 262,518 shares and 131,259 warrants. Proceeds from shares and warrants are allocated between share capital and warrants on a residual value basis, whereby the fair value of the warrants is determined using a Black Scholes Option Pricing model and the fair value of share capital is based on the remaining residual value.

On October 26, 2021 the Company completed the first tranche of a non-brokered private placement. This tranche consisted of 5,888,900 flow through common shares at a price of $0.45 per share for gross proceeds of $2,650,005, of which $2,355,560 was allocated to share capital and $294,445 was allocated to flowthrough premium.

On November 3, 2021 the Company completed the second and final tranche of the private placement. This tranche consisted of 1,107,800 flow through common shares at a price of $0.45 per share for gross proceeds of $498,510, of which $443,120 was allocated to share capital and $55,390 was allocated to flow-through premium.

Finders’ fee of 497,277 common shares were paid in connection with this flow through private placement financing at a price of $0.40 per share, for a total of $198,911. Cash financing fees of $82,199 were incurred with respect to the private placement.

Going concern

At present, the Company’s operations do not generate cash inflows and its financial success is dependent on management’s ability to discover economically viable mineral deposits. The mineral exploration process can take many years and is subject to factors that are beyond the Company’s control. See “Risks and Uncertainties”.

In order to finance the Company’s future exploration programs and to cover administrative and overhead expenses, the Company may raise money through the sale of equity instruments. Many factors influence the Company’s ability to raise funds, including the health of the resource market, the climate for mineral exploration investment, the Company’s track record, and the experience and caliber of its management. Actual funding requirements may vary from those planned due to a number of factors, including the progress of exploration activities. Management believes it will be able to raise equity capital as required in the long term but recognizes there will be risks involved that may be beyond their control.

Dividends

The Company has neither declared nor paid any dividends on its Common Shares to date. The Company does not anticipate paying any dividends on its Common Shares in the foreseeable future.

Contractual commitments

The Company is required to make certain option payments totalling $24,000 per annum in order to maintain its property agreements in good standing. These payments are not considered to be commitments as the applicable agreements may be terminated by the Company at short notice without penalty.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

Exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company believes its materially in compliance with all applicable laws and regulations. Management believes that the Company has made appropriate expenditures to comply with such laws and regulations.

In connection with financings completed by the issuance of flow-through shares, the Company provides subscribers with an indemnification for any tax liability that may arise if the Company is found to have not incurred the qualifying exploration expenditures in accordance with the flow-through subscription agreements. The Company’s remaining flow through spending obligation is $2,979,223 as at December 31, 2021, of which 100% is required to be spent before December 31, 2022.

Off-Balance Sheet Arrangements

There are no off‐balance sheet arrangements to which the Company is committed.

PROPOSED TRANSACTIONS

On January 31st, 2022, the Company announced that it had entered into a non-binding memorandum of understanding (“MOU”) with Mitsui & Co., Ltd. (“Mitsui”), whereby Magna and Mitsui will discuss the possibility of Mitsui’s acquirement of a 10 to 12.5% interest in Magna’s Shakespeare Mine in exchange for cash consideration ranging between $8 million to $10 million on such terms as to be further negotiated between the parties (the “Transaction“). In connection with the Transaction, it is expected that the parties will enter into a joint venture agreement to jointly pursue the development of the Shakespeare Mine, with Magna being the operator of the Project (the “Joint Venture” or “JV”).

TRANSACTIONS WITH RELATED PARTIES

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence, and related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

During the year, the Company entered into various transactions with related parties. The transactions are measured at the exchange amounts which are the amounts of consideration established between the related parties.

In 2019, Vernon Baker, Director of the Company, advanced a loan of $194,439 to the Company. The loan was unsecured, interest free with no set terms of repayment. The loan was converted into shares of the Company during the year ended December 31, 2020.

In 2021, the Company had Consultancy income of $Nil from Mine Management Partners Ltd. (2020 - $68,550), a Company controlled by the Chief Executive Officer. Trade receivables in relation to the above was $Nil as of December 31, 2021 (2020 - $12,204).

Compensation to related parties during the three months and years ended December 31, 2021 and 2020 is summarized as follows:

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

	December 31, December 31, 2021 2020 Three months ended	December 31, December 31, 2021 2020 Three months ended	December 31, December 31, 2021 2020 Three months ended	December 31, December 31, 2021 2020 Three months ended	December 31, December 31, 2021 2020 Twelve months ended	December 31, December 31, 2021 2020 Twelve months ended	December 31, December 31, 2021 2020 Twelve months ended	December 31, December 31, 2021 2020 Twelve months ended
Salaries, consulting and management fees	$	221,750	$	-	$	418,800	$	-
Share based compensation		228,701		-		545,656		66,128
Total remuneration	$	450,451	$	-	$	964,456	$	66,128

(1) Salaries, consulting and management fees represent CEO, CFO, Vice President, and Director compensation.
a. Derrick Weyrauch, CFO, is a related party to the Company and is related to Weyrauch and Associates Inc. In 2021, $90,000 (2020 - $22,500) was paid to Weyrauch and Associates and there was $Nil (2020 - $Nil) outstanding at year end
b. Jason Jessup, CEO is a related party to the Company and is related to Mine Management Partners Ltd. In 2021, $Nil (2020 - $Nil) was paid to Mine Management Partners and there was $Nil (2020 - $2,593) outstanding at year end
c. Vice Presidents of the Company were paid $140,550 (2020 - $68,500). Directors were paid $32,000 (2020 - $12,000)
(2) Share based compensation represents stock option issuance to executives, officers and directors.

OUTSTANDING SHARE DATA

The Company has authorized capital of an unlimited number of Common Shares with no par value.

The Company’s capital structure as of the date hereof is:

	Number of shares	Exercise	price	Expiry date
Issued and outstanding common shares	71,753,906
Share Purchase Warrants	4,209,404	$	0.40	2022-10-26
Share Purchase Warrants	992,366		0.40	2023-05-04
Share Purchase Warrants	8,881,884		0.62	2023-05-04
Stock Options	325,000		0.06	2023-01-08
Stock Options	325,000		0.22	2023-10-01
Stock Options	893,750		0.34	2022-11-28
Stock Options	1,625,000		0.22	2023-12-07
Stock Options	308,750		0.28	2023-11-06
Stock Options	487,500		0.31	2023-11-06
Stock Options	925,000		0.50	2026-05-28
Stock Options	575,000		0.40	2026-12-23
Restricted Share Units	93,000		n/a	2024-05-28
Restricted Share Units	225,000		n/a	2024-07-27
FullyDiluted Common Shares	91,620,560

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

FINANCIAL INSTRUMENTS

Carrying value and fair value

The Company's financial instruments comprise cash, restricted cash, accounts receivable, due to/from related parties, accounts payable, accrued liabilities term loan.

Financial instruments recognized at fair value on the consolidated statements of financial position are classified in fair value hierarchy levels as follows:

Level 1: Valuation based on unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2: Valuation techniques based on inputs other than Level 1 quoted prices that are observable for the asset or liability, either directly (prices) or indirectly (derived from prices); and
Level 3: Valuation techniques with unobservable market inputs (involves assumptions and estimates by management).

Cash and restricted cash are recorded in the consolidated financial statements at amortized cost.

Accounts payable and accrued liabilities, other liabilities and provisions are classified as other financial liabilities and are recorded in the consolidated financial statements at amortized cost.

Fair value

The carrying values of cash, restricted cash, accounts payable, accrued liabilities and due to related parties do not materially differ from their fair values.

Financial risk factors

The Company's activities expose it to a variety of financial risks, including credit risk, liquidity risk, foreign exchange risk, and interest rate risk.

Credit risk

Credit risk is the risk of economic loss arising from a counterparty's failure to repay or service debt according to the contractual terms. Financial instruments that potentially subject the Company to credit risk consist of cash, and restricted cash. The carrying value of the Company's financial assets recorded in the financial statements represents the Company's maximum exposure to credit risk. The Company manages credit risk by placing cash with major Canadian financial institutions. Management believe the credit risk is low.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations associated with financial liabilities. The Company manages liquidity risk through the management of its capital structure. The Company’s approach to managing liquidity is to ensure that it will have sufficient liquidity to settle obligations and liabilities when due.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

Foreign exchange risk

The Company operates in Canada and therefore, currently, has limited exposure to foreign exchange risk arising from transactions denominated in foreign currencies. Other than Canadian dollar balances, the Company holds balances in cash and royalty payable that are denominated in U.S. dollars as outlined below. Accordingly, the Company is subject to foreign exchange risk relating to such balances in connection with fluctuations against the Canadian dollar. The Company has no program in place for hedging foreign currency risk.

The Company held the following foreign currency denominated balances as at December 31, 2021 and December 31, 2020.

mber 31, 2020.
	December 31,		December 31,
		2021		2020
Cash (US $)	$	14,346	$	128
Accrued liabilities (US $)		(346,628)		(346,628)
		(332,282)		(346,500)
Foreign exchange rate		1.27		1.27
Equivalent in Canadian dollars ($)	$	(421,998)	$	(440,055)

Based on the balances held as at December 31, 2021, a 10% decrease in the Canadian dollar per U.S. dollar exchange rates would have resulted in a increase in the net loss for the period then ended of approximately $42,200 (2020: $44,000).

Interest rate risk

Interest rate risk is the risk that cash flows will fluctuate due to changes in market interest rates. While the Company's financial assets are generally not exposed to significant interest rate risk because of their short term nature, changes in interest rates will have a corresponding impact on interest income realised on such assets.

The Company did not have any interest-bearing liabilities outstanding as at December 31, 2021 and December 31, 2020.

CAPITAL MANAGEMENT

The Company's objectives in managing its capital are as follows:

to safeguard its ability to continue as a going concern; and
to have sufficient capital to be able to meet its strategic objectives, including the continued exploration and development of its existing mineral projects and the identification of additional projects.

Given the current exploration stage of its projects, the Company's primary source of capital is derived from equity issuances. Capital consists of equity attributable to common shareholders.

The Company has no externally imposed capital requirements and manages its capital structure in accordance with its strategic objectives and changes in economic conditions. In order to maintain or adjust

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

its capital structure, the Company may issue new shares in the form of private placements and/or secondary public offerings.

ADOPTION OF NEW AND AMENDED IFRS PRONOUNCEMENTS

New standards not yet adopted

Amendments to IAS 1: Classification of Liabilities as Current or Non Current

In January 2020, the IASB issued Classification of Liabilities as Current or Non current (“Amendments to IAS 1”). The amendments aim to promote consistency in applying the requirements by helping companies determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non current. The amendments include clarifying the classification requirements for debt a company might settle by converting it into equity. The amendments are effective for annual reporting periods beginning on or after January 1, 2022, with earlier application permitted.

Amendments to IAS 37: Onerous Contracts – Cost of Fulfilling a Contract

In May 2020, the IASB issued Onerous Contracts – Cost of Fulfilling a Contract (“Amendments to IAS 37”) amending the standard regarding costs a company should include as the cost of fulfilling a contract when assessing whether a contract is onerous. The amendment is effective for annual reporting periods beginning on or after January 1, 2022.

The Company does not expect these amendments to have a material impact on the consolidated financial statements in the period of initial application.

CRITICAL ACCOUNTING ESTIMATES

In the preparation of the financial statements, management has made judgments, aside from those that involve estimates, in the process of applying the accounting policies. The judgments, which may have an effect on the amounts recognized in the consolidated financial statements, include the following:

the assessment of the going concern assumption;
the recognition of deferred income tax assets; and

COVID-19 estimation uncertainty

In March 2020, the World Health Organization recognized the outbreak of COVID-19 as a global pandemic. Government measures to limit the spread of COVID-19, including the closure of non-essential businesses, did not materially impact the Company. Due to the rapid developments and uncertainty surrounding COVID-19, it is not possible to predict the impact that COVID-19 will have on the Company's business, financial position and operating results in the future. The Company is closely monitoring the impact of the pandemic on all aspects of its business.

ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE

Additional disclosure concerning the Company’s general and administrative expenses is provided in the Company’s Statement of Operations and Comprehensive Loss contained in its unaudited financial statements for September 30, 2021, that are available on SEDAR (www.sedar.com).

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

RISKS AND UNCERTAINTIES

Risks Related to the Industry

Mineral Exploration, Development and Operating Risks

Operations in which Magna has a direct or indirect interest are subject to all of the risks normally incidental to the exploration for, and the development and operation of, mineral properties, any of which could result in damage to properties or production facilities, delays, work stoppages, monetary losses, environmental damage, damage to or destruction of equipment, personal injury or death and possible legal liability. Magna has implemented comprehensive safety and environmental measures designed to comply with or exceed government regulations and to ensure safe, reliable and efficient operations in all phases of its operations.

Magna maintains liability and property insurance, where reasonably available, in such amounts it considers prudent. While Magna believes its insurance coverage adequately addresses material risks to which it is exposed and is at a level customary for its current state of operations, such insurance is subject to coverage limits and exclusions and may not be available for the risks and hazards to which Magna is exposed. In addition, no assurance can be given that such insurance will be adequate to cover Magna's liabilities or will be generally available in the future or, if available, that premiums will be commercially justifiable. If Magna were to incur substantial liability and such damages were not covered by insurance or were in excess of policy limits, or if such liability was incurred at a time when they are unable to obtain liability insurance, the business, results of operations and financial condition of Magna could be materially adversely affected. Magna may become subject to liability for hazards against which it cannot insure or which it may elect not to insure against because of high premium costs or other reasons.

All of Magna's properties are still in the exploration stage. Mineral exploration and exploitation involves a high degree of risk, which even a combination of experience, knowledge and careful evaluation may not be able to avoid. Few properties that are explored are ultimately developed into producing mines. Unusual or unexpected formations, formation pressures, fires, power outages, labour disruptions, flooding, explosions, tailings impoundment failures, cave-ins, landslides and the inability to obtain adequate machinery, equipment or labour are some of the risks involved in mineral exploration and exploitation activities.

Substantial expenditures are required to establish mineral reserves and resources through drilling, to develop metallurgical processes to extract the metal from the material processed and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. There can be no assurance that commercial quantities of ore will be discovered. There is also no assurance that even if commercial quantities of ore are discovered, that the properties will be brought into commercial production or that the funds required to exploit mineral reserves and resources discovered by Magna will be obtained on a timely basis or at all. The commercial viability of a mineral deposit once discovered is also dependent on a number of factors, some of which are the particular attributes of the deposit, such as size, grade and proximity to infrastructure, as well as metal prices. Most of the above factors are beyond the control of Magna. There can be no assurance that Magna's mineral exploration activities will be successful. In the event that such commercial viability is never attained, Magna may seek to transfer its property interests or otherwise realize value or may even be required to abandon its business and fail as a "going concern".

Estimation of Mineralization, Resources and Reserves

There is a degree of uncertainty attributable to the calculation of mineralization, resources and reserves and corresponding grades being mined or dedicated to future production. Until reserves or mineralization are

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

actually mined and processed, the quantity of mineralization and reserve grades must be considered estimates only. These estimates depend upon geological interpretation and statistical inference drawn from drilling and sampling analysis, which may prove unreliable. There can be no assurance such estimates will be accurate. In addition, the quantity of reserves and mineralization may vary depending on commodity prices. Any material changes in quantity of reserves, mineralization, grade or stripping ratio may affect the economic viability of a mine. In addition, there can be no assurance that recoveries from laboratory tests will be duplicated in tests under on-site conditions or during production. The inclusion of mineral resource estimates should not be regarded as a representation that these amounts can be economically exploited and no assurances can be given that such resource estimates will be converted into reserves. Different experts may provide different interpretations of resource estimates.

Exploration Costs

Magna's exploration costs are based on certain cost estimates and assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. No assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect Magna's viability.

Regulatory Risks

All of Magna's activities take place within Canada. Magna's exploration activities are subject to, and any future development and production operations will be subject to, regulation by governmental authorities. Achievement of its business objectives is contingent, in part, upon compliance with regulatory requirements enacted by these governmental authorities and Magna's ability to obtain and retain all necessary regulatory approvals for the operation of its mining exploration activities. While Magna believes that it will be able to maintain its existing approvals and obtain regulatory approvals in a time and cost-effective manner in the future, changes to regulatory requirements could result in delays and could have a material adverse effect on the business, results of operations and financial condition of Magna.

Change in Laws, Regulations and Guidelines

Magna's operations are subject to a variety laws, regulations and guidelines relating to exploration, management transportation, storage and disposal of mining materials or discharge, and laws and regulations relating to health and safety, the conduct of operations and the protection of the environment. While, to the knowledge of Magna's management, Magna is currently in compliance with all such laws, changes to such laws, regulations and guidelines may have a material adverse effect on the business, results of operations and financial condition of Magna.

Permits

Magna requires licenses and permits from various governmental authorities to carry out exploration and development at its projects. Obtaining permits can be a complex and time-consuming process. There can be no assurance that Magna will be able to obtain the necessary licenses and permits on acceptable terms, in a timely manner or at all. The costs and delays associated with obtaining permits and complying with these permits and applicable laws and regulations could stop or materially delay or restrict Magna from continuing or proceeding with existing or future operations or projects. Any failure to comply with permits and applicable laws and regulations, even if inadvertent, could result in the interruption or closure of operations or material fines, penalties or other liabilities. In addition, the requirements applicable to sustain

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

existing permits and licenses may change or become more stringent over time and there is no assurance that Magna will have the resources or expertise to meet its obligations under such licenses and permits.

Title to Properties

Acquisition of rights to mineral properties is a very detailed and time-consuming process. Title to, and the area of, mineral properties may be disputed. Although Magna has investigated the title to all of the properties for which it holds concessions or other mineral leases or licenses or in respect of which it has a right to earn an interest, Magna cannot give an assurance that title to such properties will not be challenged or impugned. Magna can never be completely certain that it or its option partners will have valid title to its mineral properties. Mineral properties sometimes contain claims or transfer histories that examiners cannot verify. Magna does not carry title insurance on its properties. A successful claim that Magna does not have title to a property could cause Magna to lose its rights to that property, perhaps without compensation for its prior expenditures relating to the property.

Aboriginal Title and Rights Claims

Magna operates in some areas presently or previously inhabited or used by Indigenous peoples. Various national and international laws, codes, resolutions, conventions, guidelines and other materials relate to the rights of Indigenous peoples. Many of these materials impose obligations on the government to respect the rights of Indigenous peoples. Some mandate that the government consult with Indigenous peoples regarding government actions which may affect them, including actions to approve or grant mining rights or permits. The obligations of the government and private parties under the various national and international materials pertaining to Indigenous peoples continue to evolve and be defined. Magna's current and future operations are subject to the risk that one or more groups of Indigenous peoples may oppose the continued operation, further development or new development of those projects or operations in which Magna holds an interest. Such opposition may be directed through legal or administrative proceedings or expressed in manifestations such as protests, roadblocks or other forms of public expression against Magna's activities. Opposition by Indigenous peoples to Magna's activities may require modification of, or preclude operation or development of, Magna's projects or may require Magna to enter into agreements with Indigenous peoples with respect to Magna's projects. Such agreements may have a material adverse effect on Magna's business, financial condition and results of operations.

On June 26, 2014, the Supreme Court of Canada issued a decision in the case Tsilhqot'in Nation v. British Columbia (the " Tsilhqot'in Decision ") that may affect the Shakespeare Project located in Ontario. In the Tsilhqot'in Decision, the Court issued the first declaration of Aboriginal title in Canadian history. The Court confirmed that the Tsilhqot'in Nation held Aboriginal title to an area in northern British Columbia within their traditional territory. While the Shakespeare Project is not located within the areas involved in the Tsilhqot'in Decision, the decision has legal precedent implications for all areas in Canada where Indigenous peoples claim Aboriginal title and may lead other communities or groups to pursue similar claims in the area where the Shakespeare Project is located. While an Aboriginal title claim remains unsettled either by a treaty or court ruling, there is the potential for Aboriginal title to be established, along with the inherent rights associated with Aboriginal title, which includes the exclusive right to decide how the land is used and the right to benefit from those uses.

In areas where Indigenous peoples claim treaty or Aboriginal rights, including Aboriginal title, the Crown (federal and provincial governmental agencies) must act honourably in its dealings which may affect treaty or Aboriginal rights, whether proven or asserted. When a Crown action – such as granting a permit – may adversely affect those rights, then the Crown has a duty to consult with the affected Indigenous group before deciding on the permit. The Crown must then consider the potential impacts on the interest being claimed

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

and how any impact may be avoided, mitigated or accommodated. Magna relies on the Crown to adequately discharge its duty of consultation before issuing any permit or right to Magna, including the grant of mineral titles and associated rights. To assist in managing the risk associated with any adverse impact on treaty or Aboriginal rights, Magna works to establish good relations and relationship agreements with affected Indigenous communities to confirm their support or consent for Magna's rights and permits.

Magna cannot accurately predict whether Aboriginal rights and title claims will have a material adverse effect on its ability to carry out the intended exploration and work programs on its properties located in Canada. The legal basis for, and the strength of, an Aboriginal rights or title claim is a complex issue, and the prospect and impact of any resolution of any such claim through court decision or settlement with the government is beyond the control of Magna and cannot be predicted with certainty.

Acquisition of Additional Mineral Properties

If Magna loses or abandons its interest in one or more of its properties, then there is no assurance that it will be able to acquire other mineral properties of merit, whether by way of option or otherwise, should Magna wish to acquire any additional properties.

Technology

Magna operates in a competitive environment where its products and services are subject to technological change and evolving industry standards. Magna's future success will depend on its ability to enhance existing operations, accurately predict and anticipate evolving technology, and respond to technological advances in its industry. If Magna is unable to respond to technological changes, or fails or delays to incorporate technological enhancements in a timely and cost-effective manner, its operations may become uncompetitive and it may be unable to recover its exploration expenses, which could negatively affect its profitability and the continued viability of its business.

Reliance on Management

The success of Magna's business is dependent upon the ability, expertise, judgment, discretion and good faith of its senior management. While employment agreements are customarily used as a primary method of retaining the services of key employees, these agreements cannot assure the continued services of such employees. Any loss of the services of key personnel could have a material adverse effect on the business, operating results or financial condition of Magna.

Factors which may Prevent Realization of Growth Targets

Magna is currently in the exploration stage. Magna's growth strategy contemplates focusing on certain parts of the Shakespeare Project to identify mineral resources. There is a risk that proposed exploration activities may not be achieved on time, on budget, or at all, as it could be adversely affected by a variety of factors, including: delays in obtaining, or conditions imposed by, regulatory approvals; facility design errors; environmental pollution issues; non-performance by third party contractors; increases in materials or labour costs; construction performance falling below expected levels of output or efficiency; breakdown, aging or failure of equipment or processes; contractor or operator errors; labour disputes; disruptions or declines in productivity; inability to attract sufficient numbers of qualified workers; disruption in the supply of energy and utilities; and major incidents and/or catastrophic events, such as fires, explosions, earthquakes or storms.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

Additional Financing Requirements

In order to execute its anticipated growth strategy, Magna may require additional equity and/or debt financing to support ongoing operations, undertake capital expenditures, or undertake business combination transactions or other initiatives. There can be no assurance that additional financing will be available to Magna when needed or on terms which are acceptable. Magna's inability to raise additional financing could limit its growth and may have a material adverse effect upon its business, operations, results, financial condition or prospects.

If additional funds are raised through further issuances of equity or securities convertible into equity, existing shareholders could suffer significant dilution, and any new equity securities issued could have rights, preferences and privileges superior to those of holders of Common Shares. Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for Magna to obtain additional capital and to pursue business opportunities.

Liquidity and Funding

As at the date hereof, Magna has no income producing assets and will generate losses for the foreseeable future. Until it is able to develop a project and generate appropriate cash flow, it is dependent upon being able to obtain future equity or debt funding to support long term exploration. Neither Magna nor any of the directors of Magna, nor any other party, can provide any guarantee or assurance that if further funding is required, such funding can be raised on terms favourable to Magna, or at all. Any additional equity funding will dilute existing shareholders of Magna. Further, no guarantee or assurance can be given as to when a project can be developed to the stage where it will generate cash flow. As such, a project will be dependent on many factors, including, for example, exploration success, subsequent development, commissioning and operational performance.

Repatriation of Earnings

There is no assurance that any countries other than Canada in which Magna may carry on business in the future will not impose restrictions on the repatriation of earnings to foreign entities.

Unprofitable Operations

Magna is not yet generating revenue from its exploration activities and does not expect to earn any revenue in the near future. Magna may not be able to achieve or maintain profitability and may continue to incur significant losses in the future. In addition, Magna expects to continue to increase operating expenses as it implements initiatives to continue to grow its business. If Magna's revenues do not increase to offset these expected increases in costs and operating expenses, Magna may not be profitable.

Competition

Magna is expected to face competition from other companies, some of which can be expected to have longer operating histories and more financial resources than Magna. Increased competition by larger and better financed competitors could materially and adversely affect the business, financial condition and results of operations of Magna.

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

Reliance on Key Inputs

Magna's business is dependent on a number of key inputs, including supplies and equipment required to continue operations, as well as electricity, water and other local utilities. Any significant interruption or negative change in the availability or economics of the supply chain for key inputs could materially impact the business, financial condition and operating results of Magna. Further, some of these inputs may only be available from a single supplier or a limited group of suppliers. If a sole source supplier was to go out of business, Magna might be unable to find a replacement for such source in a timely manner or at all. If a sole source supplier were to be acquired by a competitor, that competitor may elect not to sell to Magna in the future. Any inability to secure required supplies and services, or to do so on acceptable terms, could have a material adverse impact on the business, financial condition and operating results of Magna.

Dependence on Suppliers and Skilled Labour

The ability of Magna to compete and grow will be dependent on having access, at a reasonable cost and in a timely manner, to skilled labour, equipment, parts and components. No assurances can be given that Magna will be successful in maintaining its required supply of skilled labour, equipment, parts and components. It is also possible that the exploration program contemplated by Magna may be significantly greater than anticipated by Magna's management and/or may cost more than the funds available to Magna, in which circumstance Magna may curtail, or extend the timeframes for completing, its expansion plan. This could have a material adverse effect on the financial results and operations of Magna.

Management of Growth

Magna may be subject to growth-related risks, including capacity constraints and pressure on internal systems and controls. The ability of Magna to manage growth effectively will require it to continue to implement and improve its operational and financial systems, and to expand, train and manage its employee base. The inability of Magna to deal with this growth may have a material adverse effect on the business, financial condition, results of operations and prospects of Magna.

Conflicts of Interest

Certain of the directors and officers of Magna are also directors and officers of other companies, and conflicts of interest may arise between their duties as officers and directors of Magna and as officers and directors of such other companies.

Litigation

Magna may become party to litigation from time to time in the ordinary course which could adversely affect its business. Should any such litigation be determined against Magna, such a decision could adversely affect its ability to continue operating and the market price for its securities. Even if successful, such litigation would require Magna to expend significant time and money.

Market Conditions

Share market conditions may affect the value of Magna's securities regardless of its operating performance. Share market conditions are affected by many factors, such as: general economic outlook; introduction of tax reform or other new legislation; interest rates and inflation rates; changes in investor sentiment toward particular market sectors; the demand for, and supply of, capital; and terrorism or other hostilities. The market price of securities can fall as well as rise and may be subject to varied and unpredictable influences

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

on the market for equities in general and resource exploration stocks in particular. Magna does not warrant the future performance of Magna or any return on an investment in Magna.

Commodity Prices

The price of the Common Shares and Magna's profitability, financial results and exploration activities may in the future be significantly adversely affected by declines in the price of base and precious metals. Metal prices fluctuate on a daily basis and are affected by a number of factors beyond the control of Magna, including the U.S. dollar and other foreign currency exchange rates, central bank and financial institution lending and sales, producer hedging activities, global and regional supply and demand, production costs, confidence in the global monetary system, expectations of the future rate of inflation, the availability and attractiveness of alternative investment vehicles, interest rates, terrorism and war, and other global or regional political or economic events or conditions.

The price of nickel has fluctuated widely in recent years, and future trends cannot be predicted with any degree of certainty. In addition to adversely affecting Magna's financial condition and exploration and development activities, declining commodity prices can impact operations by requiring a reassessment of the feasibility of a particular project, as well as have an impact on the perceptions of investors with respect to metal equities, and therefore, the ability of Magna to raise capital. A sustained, significant decline in the price of nickel could also cause development of any properties in which Magna may hold an interest from time to time to be impracticable. Future production from Magna's future properties, if any, will be dependent upon, among other things, the price of nickel, copper, cobalt and platinum group metals being adequate to make these properties economic. There can be no assurance that the market price of nickel will remain at current levels, that such price will increase or that market prices will not fall.

Dividends

Magna has no dividend record and does not anticipate paying any dividends on the Common Shares in the foreseeable future. Any dividends paid by Magna would be subject to tax and, potentially, withholdings.

Environmental and Employee Health and Safety Regulations

Magna's operations are subject to environmental and safety laws and regulations concerning, among other things: emissions and discharges to water, air and land; the handling and disposal of hazardous and nonhazardous materials and wastes; and employee health and safety. Magna expects to incur ongoing costs and obligations related to compliance with environmental and employee health and safety matters. Failure to comply with environmental and safety laws and regulations may result in additional costs for corrective measures, penalties or restrictions on Magna's operations. In addition, changes in environmental, employee health and safety or other laws, more vigorous enforcement thereof, or other unanticipated events, could require extensive changes to Magna's operations or give rise to material liabilities, which could have a material adverse effect on the business, results of operations and financial condition of Magna.

Unknown Environmental Risks for Past Activities

Exploration and mining operations involve the potential risk of releases of metals, chemicals, fuels, liquids having acidic properties and other contaminants to soil, surface water and groundwater. In recent years, regulatory requirements and improved technology have significantly reduced those risks. However, those risks have not been eliminated, and the risk of environmental contamination from present and past exploration or mining activities exists for all mining companies. Magna may be liable for environmental contamination and natural resource damages relating to the properties that it currently owns or operates or

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

at which environmental contamination occurred while or before Magna owned or operated the properties. No assurance can be given that potential liabilities for such contamination or damages caused by past activities at these properties do not exist.

COVID-19 Coronavirus Outbreak

In December 2019, a novel strain of coronavirus known as COVID-19 emerged and spread around the world, causing significant business and social disruption. COVID-19 was declared a worldwide pandemic by the World Health Organization on March 11, 2020. The speed and extent of the spread of COVID-19, and the duration and intensity of resulting business disruption and related financial and social impact, are uncertain. Such adverse effects related to COVID-19 and other public health crises may be material to Magna. The impact of COVID-19 and efforts to slow the spread of COVID-19 could severely impact the exploration and any development of Magna's mineral projects. To date, a number of governments have declared states of emergency and have implemented restrictive measures such as travel bans, quarantine and self-isolation, and the duration and severity of the impact of COVID-19 and associated restrictions remains uncertain. If the exploration or any development of Magna's mineral projects is disrupted or suspended as a result of these or other measures, it may have a material adverse impact on Magna's financial position and the market price of its securities.

Magna's business could be significantly adversely affected by the effects of COVID-19 or any other widespread global outbreak of contagious disease. Magna cannot accurately predict the impact that COVID-19 will have on third parties' ability to meet their obligations with Magna, including due to uncertainties relating to the severity of the disease, the duration of the outbreak and the extent of travel and quarantine restrictions imposed by governments of affected countries. In addition, the current outbreak of COVID-19, and any future emergence and spread of contagious disease, could have a material adverse impact on global economic conditions, which may adversely impact the market price of its securities, its operations, its ability to raise debt or equity financing for the purposes of mineral exploration and development, and the operations of its suppliers, contractors and service providers. Any potential stoppages on exploration activities could result in additional costs, project delays, cost overruns and operational restart costs. The total amount of funds that Magna needs to carry out its proposed operations may increase from these and other consequences of the COVID-19 pandemic.

While governmental agencies and private sector participants are seeking to mitigate the adverse effects of COVID-19, and the medical community is seeking to develop vaccines and other treatment options, the efficacy and timing of such measures is uncertain.

CAUTIONARY NOTE TO UNITED STATES SHAREHOLDERS CONCERNING ESTIMATES OF MINERAL RESERVES AND MINERAL RESOURCES

This MD&A has been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ in certain material respects from the disclosure requirements of United States securities laws. The terms "mineral reserve", "proven mineral reserve" and "probable mineral reserve" are Canadian mining terms as defined in accordance with Canadian NI 43-101 Standards of Disclosure for Mineral Projects and the Canadian Institute of Mining, Metallurgy and Petroleum (the " CIM ") - CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended. These definitions differ from the definitions in the disclosure requirements promulgated by the Securities and Exchange Commission (the " Commission ") and contained in Industry Guide 7 (" Industry Guide 7 "). Under Industry Guide 7 standards, a "final" or "bankable" feasibility study is required to report mineral reserves, the three-year historical average price is used in any mineral reserve or cash flow analysis

Magna Mining Inc. (formerly CT Developers Ltd.) Management Discussion and Analysis For the year ended December 31, 2021

to designate mineral reserves and the primary environmental analysis or report must be filed with the appropriate governmental authority.

In addition, the terms "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource" are defined in and required to be disclosed by NI 43-101. However, these terms are not defined terms under Industry Guide 7 and are not permitted to be used in reports and registration statements of United States companies filed with the Commission. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into mineral reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of "contained ounces" in a mineral resource is permitted disclosure under Canadian regulations. In contrast, the Commission only permits U.S. companies to report mineralization that does not constitute "mineral reserves" by Commission standards as in place tonnage and grade without reference to unit measures.

Accordingly, information contained in this MD&A may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations of the Commission thereunder.

ADDITIONAL INFORMATION

Additional information relating to the Company is on SEDAR at www.sedar.com

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Magna Mining Inc. — Management Reports 2022

46860_rns_2022-04-25_ea491a06-b23d-4f2c-a9a2-ad4193b03b84.pdf

Magna Mining Inc. (formerly CT Developers Ltd.)

INTRODUCTION

FORWARD LOOKING STATEMENTS

OVERVIEW

Description of Business

HIGHLIGHTS DURING AND SUBSEQUENT TO THE YEAR ENDED DECEMBER 31, 2021

Exploration

Consulting agreement

Qualifying Transaction

Sale of Fox Mountain Property

Stock Options

Restricted Share Units (“RSU”)

MINERAL PROPERTIES

Shakespeare Project

Spanish River Option

Shining Tree Nickel Project

OUTLOOK

REVIEW OF OPERATIONS AND FINANCIAL RESULTS

Years ended December 31, 2021 and 2020

Three-months ended December 31, 2021 and 2020

Exploration and evaluation expenditures

SELECTED ANNUAL FINANCIAL INFORMATION

SUMMARY OF QUARTERLY RESULTS

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Year ended December 31, 2021

Financing activities

Going concern

Dividends

Contractual commitments

Off-Balance Sheet Arrangements

PROPOSED TRANSACTIONS

TRANSACTIONS WITH RELATED PARTIES

OUTSTANDING SHARE DATA

FINANCIAL INSTRUMENTS

Carrying value and fair value

Fair value

Financial risk factors

Credit risk

Liquidity risk

Foreign exchange risk

Interest rate risk

CAPITAL MANAGEMENT

ADOPTION OF NEW AND AMENDED IFRS PRONOUNCEMENTS

New standards not yet adopted

Amendments to IAS 1: Classification of Liabilities as Current or Non Current

Amendments to IAS 37: Onerous Contracts – Cost of Fulfilling a Contract

CRITICAL ACCOUNTING ESTIMATES

COVID-19 estimation uncertainty

ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE

RISKS AND UNCERTAINTIES

Risks Related to the Industry

Mineral Exploration, Development and Operating Risks

Estimation of Mineralization, Resources and Reserves

Exploration Costs

Regulatory Risks

Change in Laws, Regulations and Guidelines

Permits

Title to Properties

Aboriginal Title and Rights Claims

Acquisition of Additional Mineral Properties

Technology

Reliance on Management

Factors which may Prevent Realization of Growth Targets

Additional Financing Requirements

Liquidity and Funding

Repatriation of Earnings

Unprofitable Operations

Competition

Reliance on Key Inputs

Dependence on Suppliers and Skilled Labour

Management of Growth

Conflicts of Interest

Litigation

Market Conditions

Commodity Prices

Dividends

Environmental and Employee Health and Safety Regulations

Magna Mining Inc. Management Reports 2022