MAX Resource Corp. — Management Reports 2021

May 1, 2021

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MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL POSITION AND RESULTS OF OPERATIONS

For the year ended December 31, 2020

1.1 Date of report: April 30, 2021

The following management’s discussion and analysis (“MD&A”) should be read in conjunction with the audited consolidated financial statements and related notes for Max Resource Corp. (“MAX” or the “Company”) for the years ended December 31, 2020 and 2019 which are prepared in Canadian dollars and in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The financial statements and related notes are available at www.sedar.com.

Management is responsible for the preparation and integrity of the Company’s consolidated financial statements, including the maintenance of appropriate information systems, procedures and internal controls. Management is also responsible for ensuring that information disclosed externally, including that within the Company’s consolidated financial statements and MD&A, is complete and reliable.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This MD&A may contain certain statements that may be deemed “forward-looking statements”. All statements in this document, other than statements of historical fact, which address events or developments that the Company expects to occur, are forwardlooking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential”, “interprets” and similar expressions, or events or conditions that “will”, “would”, “may”, “could” or “should” occur. Forward-looking statements in this document include statements regarding future exploration programs, joint venture partner participation, liquidity and effects of accounting policy changes.

Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploration success, continued availability of capital and financing, inability to obtain required regulatory or governmental approvals and general economic, market or business conditions. Readers are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements.

Forward-looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made. The Company undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates, opinions or other factors should change except as required by law.

These statements are based on a number of assumptions including, among others, assumptions regarding general business and economic conditions, the timing of the receipt of regulatory and governmental approvals for the transactions described herein, the ability of the Company and other relevant parties to satisfy stock exchange and other regulatory requirements in a timely manner, the availability of financing for the Company’s proposed transactions and exploration and development programs on reasonable terms and the ability of third-party service providers to deliver services in a timely manner. The foregoing list of assumptions is not exhaustive. Events or circumstances could cause results to differ materially.

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1.2 Overall Performance

The Company is a natural resource company engaged in the acquisition and exploration of mineral properties. The Company is currently seeking acquisition targets in Canada, Peru, and Colombia. The Company trades on the TSX Venture Exchange (“TSX-V”) under the symbol MXR. In February 2021, the Company was ranked in the top 10 performing stocks in the 2021 TSX Venture 50, which is comprised of the top 50 from over 1,600 companies on the TSX-V.

The Company owns the following subsidiaries:

Name	Jurisdiction
Gachala Colombia Corp.	British Columbia, Canada
Gachala Colombia Corp Sucursal Colombia (“Gachala”)	Colombia
PGE Americas Metals Corp.	British Columbia, Canada
Valleduper Colombia Corp.	British Columbia, Canada
Valleduper Colombia SAS (“Valleduper”)	Colombia
Baccancas Colombia Corp.	British Columbia, Canada
Baccancas Colombia SAS (“Baccancas”)	Colombia
TUCO Resource Corp.	British Columbia, Canada
TUCO Resource Corp. S.A.C(“TUCO”)	Peru

Financings

On October 22, 2020, the Company closed an oversubscribed, non-brokered private placement financing for total gross proceeds of $6.5-million. The Company issued 27,083,333 units at a price of $0.24 per unit. Each unit is comprised of one common share and one-half of one transferable share purchase warrant with each whole warrant exercisable to acquire one additional share at an exercise price of $0.40 per share for a period of 12 months from the date of issuance, subject to accelerated expiry. In the event that the Company's common shares trade at a closing price at or greater than $0.80 per share for a period of 10 consecutive trading days, the Company may accelerate the expiry date of the warrants by giving notice to the holders thereof, and in such case, the warrants will expire on the 30th day after the date on which such notice is given by the Company. In addition, the Company has paid finders' fees totalling $302,035 and issued an aggregate 1,242,481 finders' warrants and recognized $27,422 of filing fees as share issuance costs. Each finder's warrant is exercisable into one common share at an exercise price of $0.40 per share for a period of 12 months from the date of issuance, also subject to accelerated expiry.

On August 19, 2020 the Company closed a non-brokered private placement financing for total gross proceeds of $1,050,000. The Company issued 9,999,999 units at a price of $0.105 per unit. Each unit is comprised of one common share and one warrant with each whole warrant entitling the holder to purchase one additional common share for a period of one year at a price of $0.14 per share. In addition, the Company paid finders' fees totalling $20,301 and issued an aggregate 193,340 finders' and recognized $10,125 of filing fees as share issuance costs. Each finders' warrant is exercisable into one common share for a period of up to one year at a price of $0.14 per share.

On May 1, 2020, the Company issued 3,971,001 flow-through units (the “FT Units”) at a price of $0.075 per FT Unit. Each FT Unit is comprised of one flow-through common share and one-half of one warrant with each whole warrant entitling the holder to purchase one non-flow through common share for a period of two years at a price of $0.10 per share. In addition, the Company has paid finder’s fees of $29,926 and issued 265,680 finder’s warrants and recognized $4,021 of filing fees as share issuance costs. Each finders warrant is exercisable into one common share for a period of up to two years at a price of $0.10 per share.

Exploration and Evaluation Assets

CESAR COPPER-SILVER PROJECT, NE COLOMBIA

The CESAR project in North Eastern Colombia covers a significant portion of the 200-km long Cesar Basin, has now been demonstrated to contain widespread highly prospective copper-silver mineralization. This region enjoys major infrastructure as a result of oil & gas and mining operations, including Cerrejon, the largest coal mine in Latin America, jointly owned by global miners BHP Billiton, Xstrata and Anglo American (refer to Figure below).

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Max interprets the sediment-hosted stratabound copper-silver mineralization in the Cesar Basin to be analogous to the Kupferschiefer Basin in Poland. The Kupferschiefer deposits, Europe’s largest copper source, produced 3MT of copper in 2018 and 40 million ounces of silver in 2019 from an orebody 0.5 to 5.5-metres thick, grading 1.49% copper and 48.6 g/t silver. This silver yield is almost twice the production of the world’s second largest silver mine.

Source: World Silver Survey 2020 and Kupferschiefer Deposits & Prospects in SW Poland, September 27, 2019. Max cautions investors that the presence of copper-silver mineralization at Kupferschiefer is not necessarily indicative of similar mineralization at CESAR.

Due to the district-scale copper-silver prospectively of the Cesar Basin, Max has initiated a multiple faceted exploration program for 2021:

Advanced Drill Core Analysis and Modelling: ongoing interpretation of seismic sections and analysis of historical drill holes, all being integrated into our structural modelling of the Cesar Basin, in collaboration with Ingeniería Geológica Universidad Nacional de Colombia (“IGUN”) in Medellín;

Geochemical and Mineralogical: geochemical and mineralogy research programs by the University of Science and Technology (“AGH”) of Krakow, Poland. AGH bring their extensive knowledge of KGHM’s world renowned Kupferschiefer sediment-hosted copper-silver deposits in Poland to the CESAR project;

Geophysics: Fathom Geophysics is interpreting regional airborne magnetic and radiometric data, funded by the Company in collaboration with one of the world's leading copper producers;

Proprietary Field Exploration & Techniques: Max’s exploration teams continue to explore copper-silver stratabound targets at CESAR;

CESAR North 80-km target zone:

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AMS Copper-Silver Discovery

January 2020, located 40-km south of AMN, the AMS (previously named AM South) zone was the very first CESAR stratabound copper-silver discovery. The AMS zone has now expanded to 16-km² of Kupferschiefer-type copper-silver mineralization, and is still open along strike and down dip, with highlights of 5.8% copper and 106 g/t silver from 0.1 to 25-metre intervals;

AMN Copper-Silver Discovery

Reported in March 2020, the AMN (previously named AM North) discovery zone, outcrops along 1.8-kilometres, including a high-grade zone, with highlight values of 34.4% copper and 230 g/t silver; AMN has now expanded to a zone of 29-km² of Kupferschiefer-type copper-silver mineralization;

CONEJO Copper-Silver Discovery Update

March 2021, Max reported the CONEJO discovery, spanning over 1.6 by 0.6-km and open in all directions. Twenty-two rock panel samples returned values in excess of 5% copper, highlight values of 12.5% copper and 120 g/t silver from panels varying from 5m by 5m to 1m by 1m*. The Max field team are currently rock chip sampling and mapping the copper bearing rock to determine potential volume and average copper-silver values.

URU Copper Discovery Update

April 2021, Max reported the URU zone discovery, lying along the southern portion of the CESAR North belt. The presence of copper mineralization extends over 3.7-kilometres, and is open in all directions. Over 125 samples were collected and sent to ALS for analysis;

SP Copper Zone

April 2021, the new SP zone, lies along the mid portion of the 80-kilometre CESAR North belt, and at first pass, lines up well with the four previous copper discoveries (URU, CONEJO, AMN and AMS).

CESAR West target zone:

• Max has initiated a first pass field program to identify copper-silver mineralization along the new CESAR West 180kilometre-long target zone.

CESAR Exploration completed during the Quarter Ended December 31, 2020

On October 7, 2020, Max announced the discovery of a new 400-metre mineralization, extending the AMS stratabound coppersilver horizon to over 6.4 kilometres of cumulative strike. Highlight AMS rock sample results include:

• 3.3 per cent copper plus seven grams per tonne silver over 25.0-metre interval (composite representative grab);

• 2.1 per cent copper plus seven g/t silver over 25.0-metre interval (composite representative grab);

• 6.4 per cent copper plus 106 g/t silver over 2.0 metres by 1.0 metre (composite panel);

• 5.0 per cent copper plus 74 g/t silver over 2.0 metres (chip channel);

• 6.8 per cent copper plus 88 g/t silver over 1.5 metres (chip channel);

• 2.9 per cent copper plus 43 g/t silver over 1.5 metres (chip channel).

The representative grab sample located on AMS-3 is open ended over a 25-metre interval with values of 3.3 per cent copper and seven g/t silver and will be resampled as a series of continuous chip channels. The AMS-3 stratabound horizon now extends for over 2.9 kilometres and remains open along strike and downdip. The seven first pass composite representative grab sample locations over 400 metres of mineralization were 25-metre intervals with assays ranging from 0.3 per cent to 2.1 per cent copper. The new discovery remains open and will be resampled as a series of continuous chip channels. It will also be mapped and mineralization will be followed along its strike.

The AMS stratabound copper-silver zone now covers an area of over four by four kilometres and remains opens laterally. The accumulative strike of AMS-1, AMS-2, AMS-3 and the new discovery is now over 6.4 kilometres and remains open along the strike and downdip. The copper-silver mineralization is interpreted to be stratabound, hosted in fine-grained clastic sediments: sandstone and siltstone. The most common copper minerals visible on surface are copper oxides (malachite and azurite) and appear to be replaced by chalcocite at shallow depths. The general strike of the AMS copper-silver mineralization lies subhorizontal about 245

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degrees with shallow dip to the northwest. AMN zone is located 40 kilometres north-northeast of AMS along the same mineralized trend.

October 7, 2020 Table 1. AMS: Significant rock sample assay results assay and sampled intervals.

Target	Sample	Sample	Interval	Copper	Silver	Summary
Horizon	No	**Type **	m	%	**g/t **	Interval[m] @ Copper[%] & Silver[g/t]
AMS-3	875077	Composite Grab	25	3.3	7	25m@3.3% copper + 7g/t silver
Discovery	875444	Composite Grab	25	2.1	4	25m@2.1% copper + 4g/t silver
AMS-2	875238	ChipChannel	1.5	6.8	88	1.5m@6.8 % Cu & 88g/t Ag
AMS-2	875250	Panel	2 x 1	6.4	106
AMS-2	875247	ChipChannel	0.5	5.0	79	1.5m@2.9 % Cu & 43g/t Ag
AMS-2	875233	ChipChannel	2	5.0	74
AMS-2	875199	ChipChannel	0.5	3.6	50
AMS-3	875376	ChipChannel	0.5	3.6	95
AMS-3	875378	ChipChannel	0.5	2.3	168	2.2m@ 1.4% Cu & 64g/t Ag
AMS-2	875329	ChipChannel	2	2.0	36	2m@ 2.0 % Cu & 36g/t Ag
AMS-2	875324	ChipChannel	1.2	1.9	23	1.2m@ 1.9 % Cu & 23g/t Ag
AMS-3	875378	ChipChannel	0.5	2.3	168	2.2m@ 1.4% Cu & 64g/t Ag
AMS-3	875369	ChipChannel	1.3	2.0	16
AMS-2	875324	ChipChannel	1.2	1.9	23	1.2m@ 1.9 % Cu & 23g/t Ag
AMS-3	875367	ChipChannel	0.5	1.5	7
AMS-3	875371	ChipChannel	2	1.4	20
AMS-3	875368	ChipChannel	0.3	1.3	34
AMS-3	875319	ChipChannel	1	1.2	12	1m@ 1.2% cu & 12g/t Ag
AMS-3	875370	ChipChannel	1	1.1	16
AMS-3	875366	ChipChannel	1	0.7	8
AMS-3	875372	ChipChannel	0.5	0.3	1
AMS-2	875200	ChipChannel	0.5	0.2	1
AMS-3	875377	ChipChannel	1.2	0.1	8
AMS-2	875198	ChipChannel	0.5	0.1	2

On October 28, 2020, Max released series of 25-metre representative grab samples collected over 250 metres from the AMS zone. Highlights include:

• 5.8 per cent copper plus 51 grams per tonne silver over 25 metres;

• 5.2 per cent copper plus 58 g/t silver over 25 metres;

• 3.3 per cent copper plus 32 g/t silver over 25 metres;

• 2.4 per cent copper plus 23 g/t silver over 25 metres;

• 0.9 per cent copper plus seven g/t silver over 25 metres;

• • 0.5 per cent copper plus five g/t silver over 25 metres.

Each sample was taken from the available outcrop over 25-metre intervals and combined into one sample. The average grade over 250 metres is 3.0 per cent copper plus 29 g/t silver. Thickness of the copper-silver horizon has yet to be determined.

The company considers these results to be extremely significant as they clearly demonstrate the persistence of copper-silver mineralization over 250 metres. The angle of the slope and the dip of the copper-silver horizon appears to be closely parallel, meaning the mineralization crops out at surface. The absence of visible copper oxides (malachite or azurite) in these samples indicate the dominant copper mineral is likely chalcocite, which carries a higher (80 per cent) copper content.

The AMN copper-silver mineralization is interpreted to be stratabound, hosted in fine-grained clastic sediments: sandstone and siltstone. The general strike of the AMN copper-silver mineralization is 245 degrees with a shallow dip to the northwest. AMS copper-silver zone occurs 40 km south-southwest of AMN along the same mineralized trend.

On November 9, 2020 the Company further reported reconnaissance grab rock sampling along 15 km of strike at Cesar South identified multiple stratabound copper-silver occurrences very similar to the AMN and AMS zones. Copper values ranged from 0.3 per cent to 11.4 per cent, with a highlight value of 11.4 per cent copper plus 656 grams per tonne (21 ounces/ton) silver. Sample results include:

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• 11.4 per cent copper plus 656 grams per tonne silver;

• 1.7 per cent copper plus 14 g/t silver;

• 1.2 per cent copper plus 18 g/t silver;

• 1.2 per cent copper plus 10 g/t silver;

• 0.5 per cent copper plus three g/t silver;

• 0.4 per cent copper plus 28 g/t silver;

• • 0.3 per cent copper plus three g/t silver.

The newly identified copper-silver mineralization at Cesar South is considered most significant because it confirms the presence of significant stratabound copper-silver mineralization at both the southern and northern margins of the sedimentary basin, a distance of over 200 km, suggesting the mineralization may be continuous through the entire basin.

On November 23, 2020, Max announced it purchased the underlying 15-per-cent net production royalties over AMN and AMS for annual payments of $50,000 (U.S.) over 10 years (2020 is paid). The Vendors retain a 3-per-cent NSR (net smelter royalty) which Max has the exclusive rights to purchase in its entirety for $4-million (U.S.) at any time prior to production.

Of significant interest, Max announced a presentation comparing the Kupferschiefer with the CESAR project had recently been delivered by leading Kupferschiefer expert Prof. Adam Piestrzynski from AGH. Professor Piestrzynski concluded the similarities between Kupferschiefer and CESAR were: basin characteristics, lithology, mineralogy, deposit assumptions, grades and origin of sulphur.

On December 02, 2020, Max announced the discovery of several new outcrops stratabound copper-silver mineralization at ANM through regional prosecting and sampling, expanding the zone to over 5.7 kilometres along strike and over 5.1 km downdip. The zone remains open along both strike and dip as the new horizons are interpreted as strike and dip continuations of the zone. Highlight rock chip channel results include:

• 7.2 per cent copper plus 55 grams per tonne silver over 2.0 metres;

• 5.9 per cent copper plus 56 g/t silver over 1.5 metres;

• 5.5 per cent copper plus 56 g/t silver over 1.0 metre;

• 3.4 per cent copper plus 63 g/t silver over 1.0 metre;

• • 3.0 per cent copper plus 29 g/t silver over 3.0 metres.

The new discovery, 1.5 km to the south of the main ANM horizon, is interpreted as the fault offset and down dropped, up-dip continuation of the main AMN horizon. Additionally, new mineralized outcrops were mapped and sampled approximately 3.5 km downdip from the main AMN discovery zone. Both areas need additional structural mapping to determine the significance of this new discovery.

The copper-silver mineralization at the Herradura zone is of stratabound, Kupferschiefer type. Mineralization is hosted in finegrained sediments: sandstone and siltstone, mainly represented by chalcocite and copper oxides (malachite and azurite). Based on field observations and mineralogical studies, the surface copper oxides phase out at shallow depth to copper sulphide, mainly chalcocite.

December 2, 2020 Table 1. AMN plus 1 per cent Copper and Sample Intervals

Sample	Sample_Type	Interval (m)	Copper (%)	Silver (g/t)	Average metre @ % copper + g/t silver
425621	Chip Channel	2.0	7.2	65	2.0m @ 7.2 % copper + 65 g/t silver
875658	Chip Channel	0.6	5.0	57	0.6m@ 5.0 % copper + 57g/t silver
875744	Chip Channel	0.3	12.9	171	0.8m @ 4.9 % copper + 65 g/t silver
875745	Chip Channel	0.5	0.2	1
875739	Chip Channel	0.6	4.7	27	0.6m@ 4.7 % copper + 27g/t silver
875272	Chip Channel	0.5	4.7	43	0.5m @ 4.7 % copper + 43 g/t silver

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875344	Panel	1.5	4.2	11	1.5m @ 4.2 % copper + 11 g/t silver
425609	Chip Channel	1.0	3.4	63	1.0m @ 3.4 % copper + 63 g/t silver
875734	Chip Channel	1.5	5.9	57	3.0m @ 3.0 % copper + 29 g/t silver
875735	Chip Channel	0.5	0.3	2
875736	Chip Channel	1.0	0.2	2
875564	Chip Channel	0.6	3.0	4	0.6m @ 3.0 % copper + 4 g/t silver
875557	Chip Channel	0.6	3.0	20	0.6m @ 2.97 % Cu & 20 g/t silver
425610	Chip Channel	1.0	2.9	44	1.0m @ 2.9 % copper + 44 g/t silver
875347	Chip Channel	0.6	2.6	41	0.6m @ 2.6 % copper + 41 g/t silver
875341	Chip Channel	0.8	2.4	8	0.8m @ 2.4 % copper + 8 g/t silver
875723	Chip Channel	1.0	5.5	56	2.5m @ 2.3 % copper + 23 g/t silver
875724	Chip Channel	0.5	0.2	1
875725	Chip Channel	1.0	0.1	0
875673	Chip Channel	1.0	2.9	27	1.5m @ 2.0 % copper + 19 g/t silver
875674	Chip Channel	0.5	0.4	5
875290	Chip Channel	0.7	5.8	74	2.2m@ 1.9 % copper + 25g/t silver
875292	Chip Channel	0.5	0.2	3
875294	Chip Channel	1.0	0.1	1
875728	Chip Channel	0.8	2.9	18	1.5m @ 1.8 % copper + 11 g/t silver
875731	Chip Channel	0.7	0.5	4
875663	Chip Channel	0.4	1.5	3	0.4m@ 1.5 % copper + 3g/t silver
875718	Chip Channel	0.5	2.79	15	0.95m @ 1.4 % copper + 8 g/t silver
875719	Chip Channel	0.5	0.17	1
875683	Chip Channel	1.20	2.6	82	2.7m @ 1.3 % copper + 40 g/t silver
875684	Chip Channel	0.5	0.3	7
875685	Chip Channel	1.0	0.4	6
875509	Chip Channel	1.5	1.3	10	1.5m@ 1.3 % copper + 10g/t silver
875297	Chip Channel	0.7	1.3	14	0.7m@ 1.3 % copper + 14g/t silver

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875515	Chip Channel	1.5	1.3	13	1.5m@ 1.3 % copper + 13g/t silver
875749	Chip Channel	1.2	1.2	7	1.2m@ 1.17% copper + 7g/t silver
875341	Chip Channel	0.8	2.4	8	2.3m @ 1% copper + 4 g/t silver
875342	Chip Channel	0.5	0.2	1
875343	Chip Channel	1.0	0.3	1
875815	Chip Channel	0.4	1.6	34	0.4m @ 1.6% copper + 34 g/t silver
425628	Chip Channel	1.5	1.6	17	1.5m @ 1.6% copper + 17 g/t silver
875574	Chip Channel	0.6	1.6	2	0.6m @ 1.6% copper + 2 g/t silver
875542	Chip Channel	0.5	1.5	14	0.5m @ 1.5% copper + 14 g/t silver
875749	Chip Channel	1.2	1.2	7	1.5m @ 0.9 % copper + 5 g/t silver
875750	Chip Channel	0.5	0.1	1
875641	Chip Channel	1.0	0.1	1	2m@ 0.5 % copper + 6g/t silver
875642	Chip Channel	0.5	0.2	2
875643	Chip Channel	0.5	1.7	18
875678	Chip Channel	0.4	1.4	11	1.9m@ 0.4 % copper + 3g/t silver
875679	Chip Channel	0.5	0.1	1
875680	Chip Channel	1.0	0.2	2
875667	Chip Channel	0.5	0.1	1	2.5m @ 0.3 % copper + 4 g/t silver
875668	Chip Channel	0.5	1.1	6
875669	Chip Channel	0.5	0.3	5
875670	Chip Channel	1.0	0.1	3

On December 08, 2020 Max reported the commencement of drill core and seismic analysis, as part of the structural study of the Cesar basin being conducted in collaboration with the Ingenieria Geologica Universidad Nacional de Colombia (IGUN).

The analysis is being conducted at the Colombian geological survey facility in Santander. The oil and gas drill cores, securely stored within this facility, have never been studied from a metal industry perspective. Initially, the analysis will concentrate on drill core, intersecting the prospective Jurassic stratigraphy, focusing on XRF measurements, binocular microscope studies, and photography of both selected mineralized intervals and stratigraphic contacts.

The analytical results and seismic sections will be integrated with the existing company database to build a 3-D model. The model will assist in determining the thickness and extent of the Cesar copper-silver mineralization at surface and depth, anticipated to greatly assist continuing exploration.

CESAR Exploration completed subsequent to the Quarter Ended December 31, 2020

On January 11, 2021 Max announced the discovery of copper mineralization in historic drill core through XRF analysis from the Cesar basin structural study. As previously reported, the structural study is being conducted by Max in collaboration with the

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Ingenieria Geologica Universidad Nacional de Colombia (IGUN). Historic drill core containing favourable Jurassic stratigraphy is analyzed with an XRF unit for elevated copper readings.

Max will continue with drill core analysis, further advancing the structural model by superimposing drill holes and identified core intervals with copper onto seismic sections and projecting the mineralized horizon to surface. All observed data are being recorded into the company database to construct a 3-D model.

In addition, the structural study provides a guide for Max's land expansion strategy and Max's continuing CESAR copper-silver exploration programs.

Max cautions investors that, while an XRF unit can detect anomalous concentrations of various metals within the core, the reading is not an assay completed at an accredited assay laboratory. Max is utilizing the XRF unit for qualitative, not quantitative, analysis of the cores of the presence copper.

The copper-enriched intervals of the historic drill core are hosted in grey sandstone that changes to red (hematite rich) outside copper enrichment. This zonation from red hematite-enriched sandstone to grey is very characteristic of Poland's Kupferschiefer and represents reducing environment where copper was precipitated from solution to form the Kupferschiefer copper-silver deposits.

On January 26, 2021 Max announced the acquisition of CESAR West at the CESAR project. CESAR West was identified through surface structural mapping, interpretation of available seismic sections and drill core review. The Max in-country field crew commenced sampling and mapping for Jurassic host rock and copper-silver mineralization along this new continuous 140kilometre-long target zone.

The Company secured 20 mineral applications from an arm's-length vendor by agreeing to pay $175,000 (U.S.). The vendor retains a 3-per-cent net smelter royalty, with the company having the exclusive right to purchase 100 per cent of the 3-per-cent NSR for $4-million (U.S.), any time prior to production.

On February 17, 2021 Max announced the expansion of the CESAR West zone, encompassing an area of favorable stratigraphy along some 140 kilometres.

On March 02, 2021 Max announced the discovery of CONEJO, a new type of copper mineralization hosted in igneous rock, at CESAR North. This new mineralization is considered to be related to the sediment copper-silver system, but hosted in an igneous (volcanic) unit. It is associated with fracture-controlled primary chalcocite mineralization that becomes more continuous as fracture density increases. Over 200 rock samples have been sent to ALS. Assay results are expected early April.

On March 23, 2021 Max released high-grade copper and silver results from the new CONEJO discovery at CESAR North. CONEJO spars over a zone of 1.6 by 0.6 kilometre, is open in all directions an hosted in a stockwork crosscutting igneous host rock, overlying or crosscutting a mineralized stratabound horizon. Highlight assays greater than 9 per cent copper and 50 grams per tonne silver:

• 12.5 per cent copper plus 83.5 g/t silver over five metres by five metres;

• 10.7 per cent copper plus 51.6 g/t silver over one metre by one metre;

• 10.5 per cent copper plus 50.1 g/t silver over three metres by two metres;

• 10.4 per cent copper plus 95 g/t silver over five metres by five metres;

• 10.2 per cent copper plus 62 g/t silver over five metres by five metres;

• 10.0 per cent copper plus 80 g/t silver over five metres by five metres;

• • 9.5 per cent copper plus 120 g/t silver over one metre by one metre.

Twenty-two rock panel samples returned high-grade values above 5 per cent copper from panels varying from 5m by 5m to 1m by 1m. Over all, 66 rock panel samples returned significant values over 1 per cent copper, and they are presented in the attached table. Max cautions investors that rock panel sampling can be selective and is not necessarily representative of the mineralization.

CONEJO is a new high-grade copper-silver discovery and extends the CESAR North outcropping discoveries to over 35 kilometres of combined strike length. CONEJO continues the pattern of new copper-silver outcrop discoveries as the company's in-country team extends exploration activities further into unexplored areas of Max's CESAR project.

March 23, 2021 Table 1. Samples from the CONEJO Discovery Assaying over 1.0% Copper

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Sample	Sample type	Width(m)	Copper(%)	Silver(g/t)
878335	Panel	5 x 5	12.5	83.5
878389	Panel	1 x 1	10.7	51.6
878603	Panel	3 x 2	10.5	50.1
878338	Panel	5 x 5	10.4	95.2
878334	Panel	5 x 5	10.2	61.9
878363	Panel	5 x 5	10.0	79.9
878390	Panel	1 x 1	9.5	120.0
878391	Panel	1 x 1	9.00	67.2
878386	Panel	1 x 1	8.9	66.3
878336	Panel	5 x 5	8.7	89.4
878337	Panel	5 x 5	8.4	60.4
878368	Panel	5 x 5	7.9	21.0
878373	Panel	5 x 5	7.7	84.1
878333	Panel	5 x 5	7.4	47.2
878394	Panel	3 x 3	7.3	80.0
878352	Panel	5 x 5	7.0	44.5
878356	Panel	5 x 5	6.0	28.5
878348	Panel	5 x 5	5.8	16.1
878393	Panel	1 x 1	5.5	63.7
878388	Panel	1 x 1	5.5	84.4
878349	Panel	5 x 5	5.3	19.0
878604	Panel	1 x 1	5.0	54.1
878625	Panel	5 x 5	4.9	36.2
878347	Panel	5 x 5	4.9	11.1
878362	Panel	5 x 5	4.7	31.6
878351	Panel	5 x 5	4.6	28.8
878620	Panel	5 x 5	4.5	21.0
878614	Panel	5 x 5	4.4	25.8
878387	Panel	1 x 1	4.2	41.3
878381	Panel	5 x 5	4.1	16.3
878353	Panel	5 x 5	3.9	30.6
878617	Panel	5 x 5	3.8	17.6
878602	Panel	1 x 0.5	3.8	4.6
878619	Panel	5 x 5	3.6	15.2
878359	Panel	3 x 3	3.5	19.4
878364	Panel	5 x 5	3.5	18.5
878358	Panel	3 x 3	3.4	17.3
878427	Panel	5 x 5	3.3	7.6
878360	Panel	3 x 3	3.3	28.7
878621	Panel	5 x 5	3.1	15.3
878605	Panel	1 x 1	2.9	23.4
878346	Panel	5 x 5	2.7	7.9
878361	Panel	5 x 5	2.7	19.6
878606	Panel	5 x 5	2.6	29.8
878607	Panel	5 x 5	2.6	28.5
878610	Panel	5 x 5	2.5	21.0
878354	Panel	5 x 5	2.5	14.8
878382	Panel	5 x 5	2.4	3.4
878345	Panel	5 x 5	2.4	12.6
878000	Panel	5 x 5	2.4	14.4
878424	Panel	5 x 5	2.3	2.8
878601	Panel	1 x 1	2.1	6.3
878419	Panel	5 x 5	2.0	5.9

Page | 10

878628	Panel	5 x 5	2.0	12.9
878379	Panel	5 x 5	2.0	20.6
878551	Panel	1 x 1	2.0	4.7
878552	Panel	1 x 1	1.9	20.2
878425	Panel	5 x 5	1.8	4.0
878618	Panel	5 x 5	1.7	9.9
878609	Panel	5 x 5	1.6	13.5
878426	Panel	5 x 5	1.6	2.7
878612	Panel	5 x 5	1.6	11.8
878423	Panel	5 x 5	1.5	3.2
878622	Panel	5 x 5	1.5	8.5
878624	Panel	5 x 5	1.5	14.1
878422	Panel	5 x 5	1.3	2.2
878380	Panel	5 x 5	1.2	15.8
877998	Panel	5 x 5	1.1	7.1

On April 07, 2021 Max announced the discovery of URU Zone, a second copper zone located 30 kilometres south of the recently discovered CONEJO high-grade copper-silver zone, at Cesar North. The URU copper zone lies along the southern portion of the 60kilometre-long Cesar North target area. Sampling to date has located copper mineralization over an area of 3.7 kilometres, open in all directions. Over 125 rock samples have been collected and sent to ALS for assays. Results are expected early May.

The surface mineralization at the URU zone occurs as stockwork of crosscutting fractures or as disseminated mineralization hosted in igneous rock. Observed minerals include: chalcocite, native copper, cuprite and copper oxides. Epidote is also common and appears to be associated with copper mineralization.

Quality assurance

All Cesar rock chip samples are shipped to ALS Lab's sample preparation facility in Medellin, Columbia. Sample pulps are then sent to Lima, Peru, for analysis. All samples are analyzed using ALS procedure ME-MS41, a four-acid digestion with inductively coupled plasma finished. Over-limit copper and silver are determined by ALS procedure OG-62, a four-acid digestion with an atomic absorption spectroscopy finish. ALS Labs is independent from Max.

Max uses standard chip and channel sampling where possible, but also relies on rock panel and composite grab sampling. Max considers rock panel and composite grab samples to be representative but cautions investors that individual grab samples can be selective and may not be representative of continuous mineralization.

RT GOLD PROJECT, NORTHERN PERU

On September 28, 2020, Max announced the execution of an option agreement to acquire a 100-per-cent interest in the RT gold property, consisting of two contiguous mineral concessions located 760 kilometres northwest of Lima in the district of Tabaconas, Peru. Maintaining the option will require yearly payments of $300,000 (U.S.) over four years (the initial payment for 2020 has been paid), and exercise of the option will require an additional $3-million (U.S.) payment on or before the fifth anniversary.

RT Gold sits along the Condor mountain chain of northern Peru, within the Cajamarca metallogenic belt. This geological belt extends from central Peru into southern Ecuador, and hosts a number of world-class gold deposits.

Two distinct mineralized systems occur within RT Gold: the Cerro, a bulk tonnage gold-bearing porphyry zone, and three kilometres to the northwest, the Tablon, a gold-bearing massive sulphide zone.

The Cerro system hosts several known mineralized zones, including Peak, West, Breccia and Cathedral, consisting of:

• Soil geochemistry of the Cerro zone has outlined a 2.0-kilometre-by-1.5-kilometre gold anomaly, open in all directions grading from 0.1 to four grams per tonne gold.

• Soil geochemistry is coincident with induced polarization chargeability.

• Within the gold soil anomaly, several veins and structures returned assays up to 62.9 g/t and within the wall rock 0.5 to one g/t gold.

• The Cerro zone has never been drill tested.

Page | 11

The Tablon zone is located three kilometres northwest from Cerro and hosts numerous gold-bearing massive to semi-massive sulphide bodies over a 150-metre-by-450-metre area, within a larger 1.0-kilometre-by-1.5-kilometre area of anomalous gold soil and rock geochemistry. Highlight intersections from the 33 Tablon diamond drill holes completed in 2001 include:

• RT-06 returned 3.1 g/t gold over 21.4 m from 9.1 m;

• RT-11 returned 5.3 g/t gold over 17.1 m from 12.0 m;

• RT-13 returned 8.8 g/t gold over 25.4 m from 13.4 m;

• RT-22 returned 4.9 g/t gold over 14.1 m from 40.8 m;

• RT-25 returned 13.0 g/t gold over 36.1 m from 33.0 m;

• RT-29 returned 18.0 g/t gold over 16.4 m from 35.0 m.

Intervals are core lengths not true widths, which are unknown at this time (source: National Instrument 43-101 geological report, Rio Tabaconas gold project for Golden Alliance Resources Corp. by George Sivertz, Oct. 3, 2011).

The last field exploration on both the Cerro and Tablon zones was conducted over a decade ago. The Max technical team is currently reviewing and digitizing all available data for subsequent interpretation for target generation. A program of field verification by Max's in-country team, with mapping, surveying and sampling, is scheduled to follow. Concurrent with the verification program, the company will be initiating drill permitting.

RT Exploration completed during the Quarter Ended December 31, 2020

On December 20, 2020 Max announced it had secured access to the 1,600 metres f historic drill core from the 2001 drill program at the Talbon gold-bearing massive sulfide at RT Gold. Drill results from the 2001 program are detaiuled in December 20, 2020 Table 1.

December 20, 2020 Table 1. Diamond Drill Hole (DDH) intersections and gold fire assay results.

DDH Number	From (m)	To (m)	Length	Gold g/t F. Assay
RT-1	13.50	15.00	1.50	1.16
and	24.00	25.50	1.50	4.59
RT-2	39.50	39.94	0.44	44.05
RT-3	62.18	62.85	0.67	49.99
and	105.76	106.10	0.34	54.89
RT-4	7.85	11.90	4.05	2.23
and	18.02	20.29	2.27	2.67
and	26.29	28.42	2.13	2.61
RT-6	9.07	30.48	21.41	3.10
including	9.07	15.24	6.17	5.48
RT-7	10.08	30.00	19.92	2.41
including	10.08	12.55	2.47	4.55
and	25.53	25.91	0.38	7.44
RT-11	12.01	29.10	17.09	5.32
including	15.54	18.20	2.66	14.20
RT-12	17.41	21.76	4.35	4.71
RT-13	13.41	38.83	25.42	8.78
including	19.85	22.75	2.90	19.81
including	31.21	38.83	7.62	12.61
including	33.72	34.72	1.00	28.24
RT-14	17.68	19.36	1.68	5.47
RT-15	12.80	19.20	6.40	5.85
RT-16	16.17	20.07	3.90	13.18
RT-21	1.52	10.97	9.45	5.08
RT-22	8.45	9.50	1.05	2.58
and	31.39	33.80	2.40	3.21

Page | 12

and	40.75	54.86	14.11	4.85
RT-25	33.00	3.10	36.10	12.97
including	33.00	34.00	1.00	33.30
RT-26	0.00	6.00	6.00	6.95
including	1.00	2.00	1.00	17.37
and	12.02	13.00	0.98	2.80
and	17.00	18.00	1.00	2.98
RT-27	9.76	12.00	2.24	1.49
and	26.00	27.00	1.00	1.43
RT-28	1.52	10.54	9.02	1.93
and	18.35	28.10	9.75	2.21
including	23.34	25.71	2.37	5.99
RT-29	1.20	8.00	6.80	2.75
and	34.85	51.25	16.40	17.99
including	42.00	44.15	2.15	118.10

Source: NI 43:101 Geological Report Rio Tabaconas Gold Project for Golden Alliance Resources Corp. by George Sivertz, Oct.3, 2011. Intervals are core lengths not true widths, which are unknown at this time.

RT Exploration completed subsequent to the Quarter Ended December 31, 2020

None

PGE METALS AMERICAS CORP.

During the quarter, Max Resource Corp. established a wholly owned subsidiary named PGE Americas Metals Corp. whereby the company has transferred all of its rights in the PGE Choco project. This is the first step toward building a portfolio of platinumgroup-element assets with a targeted focus on palladium, platinum and rhodium in order to capitalize on real-world technology metal deficits. The corporate intent is to unlock this value in both an accelerated and timely manner.

On March 25, 2020 Max announced the Company had entered into a letter of intent (LOI), through its wholly owned subsidiary, PGE Americas Metals Corp., to acquire 100 per cent of the EBAY Palladium , located 30 kilometres southeast of Matagami in the Abitibi region of Quebec, Canada. It is underlain by the Archean Bell River complex, a layered mafic intrusion measuring 65 kilometres by 15 km and five km thick. Excellent access to the project is via a network of logging roads and trails.

Highlight results from historic exploration between 2000 to 2008 include:

• 4.87 grams per tonne palladium-platinum from a four- to five-metre-wide northerly zone from blast pit grab sampling in 2000;

• 3.04 g/t palladium plus 1.39 g/t platinum plus 0.12 g/t rhodium (4.55 g/t palladium-platinum-rhodium) and highlight value of 0.18 g/t rhodium from grab sampling in 2005;

• 2.46 g/t palladium-platinum (rhodium was not assayed) from blast pit grab sampling of a newly discovered 500-metrelong zone in 2006;

• 1.90 g/t palladium-platinum over 3.0 m from 80.5 m to 83.5 m (rhodium was not assayed) from the EBAY palladium discovery drill hole in 2006. Palladium to platinum ratio varies from 1.25 to 1.0;

• EBAY palladium discovery was the first reported PGE (platinum group element) drill intersection from the Bell River complex;

• Drilling in 2007 resulted in the discovery of a new zone with 600 m on strike, 120 m deep, 6.7 m to 31.1 m wide, open in all directions, highlight values of 2.52 g/t palladium-platinum (rhodium not assayed) width not provided;

• 2007 drilling also includes highlight values of 1.12 per cent copper and 0.36 per cent nickel over 1.8 m interval;

• Subsequent aero-magnetic survey extended the target zone to 4.8 km of strike;

• • Max is conducting reanalysis of drill core and for rhodium, iridium, osmium and ruthenium values.

The company cautions investors that grab samples are selected samples and are not necessarily representative of mineralization hosted on the project. The company also cautions investors it has not yet verified any of the historical exploration information (refer to Hinterland Metals AR 2005, Oct. 10 and Oct. 17, 2006, news releases; drill results from Hinterland Metals Nov. 21, 2006, March 13, 2007, and April 10, 2008, news releases).

Page | 13

EBAY Exploration completed during the Quarter Ended December 31, 2020

Results from the August 2020 geophysical survey and field work are pending as of the date of this M D &A.

EBAY Exploration completed Subsequent to the Quarter Ended December 31, 2020

None. The EBAY Option Agreement was terminated on March 24, 2021.

Choco Gold

On October 15, 2019, the Company announced that further to Max Resource Corp.'s press release dated April 3, 2019, the company has terminated the definitive asset purchase agreement with Noble Metals Ltd. to purchase a bundle of resource exploration assets located in the Choco department of Colombia.

During the year ended December 31, 2019, the Company relinquished a number of its mineral applications at Choco.

Choco Exploration completed during the Quarter Ended December 31, 2020

None.

Choco Exploration completed Subsequent to the Year Ended December 31, 2020

None.

North Choco Gold-Copper

On October 15, 2019, the Company announced that further to Max Resource Corp.'s press release dated May 8, 2019, the company has terminated the letter of intent (LOI) with Noble and Buena Fortuna Mining Company Pty. Ltd. to acquire up to a 100-per-cent interest in Andagueda Mining Pty. Ltd., which holds an exploration and mining agreement with the Tahami Indigenous Reservation of Alto Andagueda due to challenges surrounding due diligence.

Subsequent to the year ended December 31, 2019, the Company relinquished a number of its mineral applications at North Choco.

North Choco Exploration completed during the Quarter Ended December 31, 2020

None.

North Choco Exploration completed Subsequent to the Quarter Ended December 31, 2020

None.

GACHALA COPPER

The Company has filed mineral licence applications which have been reduced to cover an area of approximately 164 sq. km which are located within the Gachala sedimentary copper basin of eastern Colombia, approximately 60 kilometres east of Bogota.

The Company relinquished its remaining mineral applications at Gachala.

Gachala Exploration completed during the Quarter Ended December 31, 2020

None.

1.3 Selected Annual Information

Page | 14

As at December 31, 2020, the Company was listed on the TSX Venture Exchange. The Company has not recorded any revenues in the current fiscal year, and depends upon share issuances to fund its administrative and exploration expenses. See the summary of results, below:

	2020 $	2019 $	2018 $
Revenues	-	-	-
Net and comprehensive loss for theyear	(5,206,965)	(4,780,842)	(3,468,206)
Basic and diluted net lossper common share	(0.11)	(0.40)	(0.46)
Total assets	5,970,249	785,997	1,321,246
Total long-term liabilities	-	-	-

Page | 15

The Company’s current projects are at the exploration and development stages and have not generated any revenues.

At December 31, 2020, the Company had not yet achieved profitable operations and had accumulated losses of $30,448,670 (2019 – $25,241,705) since inception. The net losses for the years ended December 31, 2020 and 2019 resulted in a net loss per share of $0.11 and $0.46, respectively.

At December 31, 2020, the Company has no continuing source of operating revenues. The Company has not paid any dividends on its common shares nor does it have any present intention of paying dividends on its common shares, as it anticipates that all available funds for the foreseeable planning horizon will be invested to finance its business activities.

1.4 Results of Operations

Year ended December 31, 2020

During the year ended December 31, 2020 (the “current year”), the Company incurred a loss of $5,206,965 compared to a loss of $4,780,842 for the year ended December 31, 2019 (the “comparative year”). Variances between the current year compared to the comparative year are shown in the table below:

Expenses	Increase / Decrease in Expenses	Explanation for Change
Consulting fees	Decrease of $323,765	Decreased mainly due to the general decrease in expenditures during the current year due to COVID-19 and an overall effort to reduce costs and focus operations on the Company’s key projects
Exploration and evaluation assets	Decrease of $93,978	Decrease due to the Company focusing its efforts on its CESAR Project in Colombia rather than multiple projects as done in the comparativeyear.
Professional fees	Decrease of $261,013	Decreased due to the comparative year including additional legal fees for the Colombian operations and some proposed,but subsequentlycancelled,transactions.
Property investigation costs	Decrease of $216,298	Decrease due to less exploration performed due in the currentyear due to COVID-19.
Share-based compensation	Increase of $971,845	Increase due to the granting of more stock options in the currentyear as compared to the comparativeyear.
Travel	Decrease of $134,880	Decreased mainly due to the general decrease in expenditures during the current year due to COVID-19 and an overall effort to reduce costs and focus operations on the Company’s key projects.

In addition to the above, the Company reported the following variations for the current year as compared to the comparative year:

• an increase of $96,753 in foreign exchange gain due to differences in the period end spot rate as compared to the daily and average transactional rates for the Canadian dollar, United States dollar, Colombian Peso, and Peruvian Sol;

• a decrease of $53,784 in loss on legal settlement as there was no settlement required in the current year; and

• an increase of $668,254 in write-off of exploration asset as the Company decided not to proceed with the EBAY project.

Page | 16

1.5 Summary of Quarterly Results

	Q4-20 $	Q3-20 $	Q2-20 $	Q1-20 $	Q4-19 $	Q3-19 $	Q2-19 $	Q1-19 $
Revenue	-	-	-	-	-	-	-	-
Income (loss)	(2,249,579)	(1,310,029)	(612,963)	(1,034,394)	(880,106)	(1,196,442)	(1,513,933)	(1,190,361)
Income (loss) per Share	(0.03)	(0.02)	(0.02)	(0.04)	(0.07)	(0.10)	(0.13)	(0.10)

The loss for the first quarter of fiscal 2019 saw continued exploration work in the Choco region.

The loss for the second quarter of fiscal 2019 increased due to increased exploration in the North Choco region.

The loss for the fourth quarter of fiscal 2019 decreased due to fewer exploration and evaluation expenditures and a decrease in professional fees. The Company maintained exploration on its projects and continued to investigate additional project candidates.

The loss for the first quarter of fiscal 2020 included a $220,111 expense related to the grant of stock options. During the quarter, the Company continued exploration at its CESAR project in Colombia whereby it incurred $199,609 in exploration and evaluation costs.

The loss for the second quarter of fiscal 2020 decreased as a result of overall decreased expenditures associated with the COVID19 pandemic. The Company continued exploration at the CESAR project in Colombia and performed some initial exploration programs at the EBAY project in Quebec.

The loss for the third quarter of fiscal 2020 increased as a result in a partial resumption of operations during the COVID-19 pandemic. Exploration continued at the CESAR project in Colombia and further exploration was performed at the EBAY project in Quebec. Q3 2020 also included a $374,725 expense related to the granting and vesting of incentive stock options.

The loss for the fourth quarter of 2020 included a $668,254 write-off for the EBAY Project and a $469,318 expense related to the granting and vesting of incentive stock options.

1.6 Liquidity and Solvency

At December 31, 2020, the Company had a working capital of $4,368,679 including cash on hand of $4,697,156. This compares to working capital of $60,682 at December 31, 2019, inclusive of cash of $685,025.

The increase in cash totalling $4,012,131 during the year ended December 31, 2020 was a result of operating activities consuming $3,441,751 in cash, exploration and evaluation assets consuming $1,160,035 in cash, equipment consuming $87,189 in cash, and cash inflows net of share issuance costs, from private placements and the exercise of warrants and stock options totalling $8,701,106.

Cash flow to date has not satisfied the Company’s operational requirements. The development of the Company in the future will depend on the Company’s ability to obtain additional financings. While the Company has been successful in the past in obtaining financing through the sale of equity securities, there can be no assurance that the Company will be able to obtain adequate financing in the future or that the terms of such financing will be favourable.

1.7 Capital Resources

As at December 31, 2020, the Company had a cash and cash equivalents balance of $4,697,156 (2019 - $685,025) to settle current liabilities of $734,841 (2019: $678,254). The Company expects to fund its liabilities and its acquisition, exploration and operational activities over the next fiscal year with cash on hand and from cash received from the issuance of equity securities, primarily through private placements and the exercise of warrants.

Page | 17

1.8 Off Balance Sheet Arrangements

The Company has no off-Balance Sheet arrangements as of December 31, 2020 or the date of this MD&A.

1.9 Transactions with Related Parties

Related party balances

The following amounts due to related parties are included in trade payables and accrued liabilities:

	2020	2019
	$	$
Directors and management of the Company	13,132	159,970

These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.

Key management personnel compensation (consisting of management and certain directors)

Year ended:	2020	2019
	$	$
Management fees paid to a company controlled by the CEO and a Director	292,900	247,248
(Brett Matich)
Management fees paid to a company controlled by the CFO (Alex Helmel)	96,000	144,000
Consulting fees paid to a company controlled by the corporate secretary	30,000	35,000
(Kelly Pladson)
Director fees paid to a Director (Patrick Frandle)	20,000	-
Director fees paid to a Director (Stuart Rogers)	-	22,500
Director fees paid to a Director (Paul John)	-	22,500
Director fees paid to a Director (John Theobald)	-	9,500
Share-based compensation related to stock options issued to a Director	15,293	-
(Paul John)
	455,472	480,748

Page | 18

1.10 Fourth Quarter Highlights

Three months ended December 31, 2020

During the three months ended December 31, 2020 (the “current period”), the Company incurred a loss of $2,249,579 compared to a loss of $880,106 for the three months ended December 31, 2019 (the “comparative period”). Variances between the current period compared to the comparative period are shown in the table below:

Expenses	Increase / Decrease in Expenses	Explanation for Change
Consulting fees	Increase of $260,547	Increased as the Company engaged consultants in Q4 to assist with project development, finance, and corporate strategy.
Exploration and evaluation assets	Increase of $234,876	Increased due to the Company focusing its efforts on its CESAR Project in Colombia duringthe currentperiod.
Professional fees	Decrease of $181,461	Decreased due to the comparative period including additional legal fees for the Colombian operations and someproposed,but subsequentlycancelled,transactions.
Property investigation costs	Decrease of $101,817	Decrease due to the Company focusing its efforts on its properties in Colombia and Peru
Share-based compensation	Increase of $446,359	Increase due to the granting of more stock options in the currentperiod as compared to the comparativeperiod.

In addition to the above, the Company reported the following variations for the current period as compared to the comparative period:

• an increase of $95,861 in foreign exchange gain due to differences in the period end spot rate as compared to the daily and average transactional rates for the Canadian dollar, United States dollar, Colombian Peso, and Peruvian Sol;

• a decrease of $53,784 in loss on legal settlement as there was no settlement required in the current year; and

• an increase of $668,254 in write-off of exploration asset as the Company decided not to proceed with the EBAY project.

The Company’s focus during the fourth quarter was to continue exploration at its Canadian and Colombian projects as described above. For additional detail, see the Company’s news releases available on SEDAR.

1.11 Proposed Transactions

There are no proposed transactions that will materially affect the performance of the Company other than those which have been disclosed in this MD&A.

1.12 Critical Accounting Estimates

The preparation of financial statements in conformity with IFRS requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported revenues and expenses during the period.

Although management uses historical experience and its best knowledge of the amount, events or actions to form the basis for judgments and estimates, actual results may differ from these estimates.

The most significant accounts that require estimates as the basis for determining the stated amounts include the recoverability of exploration and evaluation assets, determination of functional currency, valuation of share-based compensation and other equity based payments, and the recoverability and measurement of deferred tax assets and liabilities.

Critical judgment exercised in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements is as follows:

• Uncertainty of COVID 19 pandemic

Page | 19

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, customers, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses, including ours. This outbreak could decrease spending, adversely affect demand for our product and harm our business and results of operations. It is not possible for us to predict the duration or magnitude of the adverse results of the outbreak and its effects on our business or results of operations at this time.

Economic recoverability and probability of future economic benefits of mineral exploration and evaluation assets

Management has determined that exploration, evaluation, and related costs incurred which were capitalized may have future economic benefits and may be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefits including, geologic and other technical information, a history of conversion of mineral resources with similar characteristics to its own properties to proven and probable mineral reserves, the quality and capacity of existing infrastructure facilities, evaluation of permitting and environmental issues and local support for the project.

Functional currency

The functional currency of the Company and its wholly owned subsidiaries is the Canadian dollar (“CAD”); however, determination of functional currency may involve certain judgments to determine the primary economic environment which is re-evaluated for each new entity or if conditions change.

Information about assumptions and estimation uncertainties that have a significant risk of resulting in material adjustments are as follows:

Valuation of share-based compensation

The Company uses the Black-Scholes Option Pricing Model for valuation of share-based compensation and other equity based payments. Option pricing models require the input of subjective assumptions including expected price volatility, interest rate, and forfeiture rate. Changes in the input assumptions can materially affect the fair value estimate and the Company’s earnings and equity reserves.

Income taxes

In assessing the probability of realizing income tax assets, management makes estimates related to expectation of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax positions taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified.

Cash and cash equivalents

Cash and cash equivalents include cash and highly liquid investments held in the form of money market investments and certificates of deposit with maturity dates less than 90 days or with investment terms that allow for penalty free redemption after one month.

Foreign currency translation

Functional and presentation currency:

The functional currency of each entity is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Canadian dollars which is the parent company and its subsidiaries’ functional and presentation currency.

Transactions and balances:

Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate in effect at the balance sheet date. Non-monetary assets and liabilities, expenses and other income arising from foreign currency transactions are translated at the exchange rate in effect at the date of the transaction. Exchange gains or losses arising from the translation are included in the determination of losses in the current year.

Page | 20

1.13 Changes in Accounting Policies including Initial Adoption

The Company did not adopt any new accounting policies during the year ended December 31, 2020.

1.14 Classification of financial instruments

Financial assets included in the statement of financial position are as follows:

	Year ended:	2020	2019
		$	$
	Cash	4,697,156	685,025
		4,697,156	685,025
Financial liabilities included in the statement of financialposition are as follows:
	Year ended:	2020	2019
		$	$
	Non-derivative financial liabilities:
	Tradepayables	734,841	678,254
		734,841	678,254

Fair value

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

• Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

• Level 3 – Inputs that are not based on observable market data.

The Company’s financial instruments consist of cash and cash equivalents, taxes recoverable, and trade payables and accrued liabilities. The fair value of taxes recoverable and trade payables and accrued liabilities approximates their carrying values. Cash and cash equivalents is measured at fair value using level 1 inputs.

Financial Risk and Capital Management

The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk management processes. The type of risk exposure and the way in which such exposure is managed is provided as follows:

Credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company’s primary exposure to credit risk is on its cash held in bank accounts. The Company’s cash is deposited with a major bank in Canada. This risk is managed by using a major bank that is a high credit quality financial institution as determined by rating agencies.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis.

Historically, the Company's primary source of funding has been the issuance of equity securities for cash, primarily through private placements and the advance of loans. The Company’s access to equity financing is dependent upon market conditions and market risks. There can be no assurance of continued access to equity funding.

As at December 31, 2020, the Company had a cash balance of $4,697,156 to settle current liabilities of $734,841.

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Currency risk

Currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currencies that differ from the respective functional currency. The Company is exposed to currency risk as it incurs expenditures that are denominated in United States dollars, Colombian Pesos, and the Peruvian Sol while its functional currency is the Canadian dollar. The Company does not hedge its exposure to fluctuations in foreign exchange rates. The majority of cash is held in Canadian dollars.

The following is a summary of Canadian dollar equivalent financial assets and liabilities that are denominated in United States dollars, Colombian Pesos, or Peruvian Sol:

Year ended:	2020	2019
	$	$
Cash	144,481	922
Tradepayables	(3,415)	(90,092)
Net assets(liabilities)	141,066	(89,170)

Based on the above net exposures, there would be a nominal impact on the Company’s net loss should there be a significant change in the Canadian dollar exchange rate compared to with the United Sates dollars, Colombian Pesos, or Peruvian Sol.

Interest rate risk

Interest rate risk is the risk due to variability of interest rates. The Company is exposed to interest rate risk on its bank account and related party loans. The income earned on the bank account is subject to the movements in interest rates. The Company has cash balances and fixed interest-bearing debt, therefore, interest rate risk is nominal.

Capital management

The Company's policy is to maintain a capital base sufficient to maintain investor and creditor confidence and to sustain future development of the business. The capital structure of the Company consists of working capital and share capital. There were no changes in the Company's approach to capital management during the year. The Company is not subject to any externally imposed capital requirements.

Other risks and uncertainties

The business and operations of the Company are subject to numerous risks, many of which are beyond the Company’s control. The Company considers the risks set out below to be some of the most significant to potential investors in the Company, but not all of the risks are associated with an investment in securities of the Company. If any of these risks materialize into actual events or circumstances or other possible additional risks and uncertainties of which the Company is currently unaware or which it considers to be material in relation to the Company’s business actually occur, the Company’s assets, liabilities, financial condition, results of operations (including future results of operations), business and business prospects, are likely to be materially and adversely affected. In such circumstances, the price of the Company’s securities could decline and investors may lose all or part of their investment.

The Company is engaged in the acquisition, exploration and development of mineral properties. Given the nature of the resource business, the limited extent of the Company’s assets, and the present stage of exploration, the following risks factors, among others, should be considered.

Global Pandemic

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, customers, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses, including ours, primarily affecting supply chains causing minor procurement delays. This outbreak could decrease spending, adversely affect demand for our product and harm our business and results of operations. It is not possible for us to predict the duration or magnitude of the adverse results of the outbreak and its effects on our business or results of operations at this time.

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Exploration, Development and Operating Risks

The Company is in the process of exploration and development of its properties and has not yet generated any revenues from production. The recovery of expenditures on mineral properties and the related exploration and evaluation expenditures are dependent on the existence of economically recoverable mineralization, the ability of the Company to obtain financing necessary to complete the exploration and development of its Projects, and upon future profitable production, or alternatively, on the sufficiency of proceeds from disposition. Resource exploration is highly speculative in nature, involves many risks and frequently is non-productive. There is no assurance that the Company’s efforts will be successful and will result in commercial production or profitability.

Fluctuating Resource Prices

The economics of resource exploration and development are affected by many factors beyond the Company’s control, including commodity prices, the cost of operations, variations in the quantity and quality of resources and fluctuations in the market price of those resources. Depending on the price of resources, the Company may determine that it is impractical to continue a resource exploration operation or to develop one. Resource prices are prone to fluctuations and the marketability of resources are affected by government regulation relating to price, royalties, allowable production and the importing and exporting of resources, the effect of which cannot be accurately predicted.

Financing Risks and Dilution to Shareholders

The Company has limited financial resources and no revenues. The Company will require additional funds to continue with its current business. Additionally, if the Company’s programs on its Projects are successful, additional funds will be required for the purposes of further exploration and development. There can be no assurance that the Company will be able to obtain adequate financing in the future or that such financing will be available on favourable terms or at all. It is likely such additional capital will be raised through the issuance of additional equity, which will result in dilution to the Company’s shareholders.

Title to Properties

Acquisition of title to mineral properties in Colombia and Peru can be a very detailed and time-consuming process. Title to, and the area of, properties could be disputed. The Company cannot give a certain assurance that title to its properties will not be challenged or impugned. A successful claim that the Company does not have title to its properties could cause the Company to lose any rights to explore, develop and mine any resources or minerals on its properties without compensation for its prior expenditures relating to its properties.

Regulatory, Permit and License Requirements

The current or future operations of the Company require permits from various governmental authorities, and such operations are and will be governed by laws and regulations concerning exploration, development, production, taxes, labour standards, occupational health, waste disposal, toxic substances, land use, environmental protection, site safety and other matters. Companies engaged in the exploration and development of mineral properties generally experience increased costs and delays in development and other schedules as a result of the need to comply with applicable laws, regulations and permits. There can be no assurance that all permits which the Company may require for facilities and the conduct of exploration and development operations on the properties will be obtainable on reasonable terms, or that such laws and regulations will not have an adverse effect on any exploration or development project which the Company might undertake.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in exploration and development operations may be required to compensate those suffering loss or damage by reason of the exploration and development activities and may have civil or criminal fines or penalties imposed upon them for violation of applicable laws or regulations. Amendments to current laws, regulations and permits governing operations and activities of resource companies, or more stringent implementation thereof, could have a material adverse impact on the Company and cause increases in capital expenditures or exploration and development costs, or require abandonment or delays in the development of new or existing properties.

Competition

The resource exploration and development industry is highly competitive. The Company will have to compete with other companies, many of which have greater financial, technical and other resources than the Company, for, among other things, the acquisition of minerals claims and other mineral interests as well as for the recruitment and retention of qualified employees and other personnel. Failure to compete successfully against other mining companies could have a material adverse effect on the Company and its prospects.

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Reliance on Management and Dependence on Key Personnel

The success of the Company will be largely dependent upon the performance of its directors and officers and the ability to attract and retain key personnel. The loss of the services of these persons may have a material adverse effect on the Company’s business and prospects. The Company will compete with numerous other companies for the recruitment and retention of qualified employees and contractors. There is no assurance that the Company can maintain the service of its directors and officers or other qualified personnel required to operate its business. Failure to do so could have a material adverse effect on the Company and its prospects.

Local Resident Concerns

Apart from ordinary environmental issues, the exploration and development the Company’s Projects could be subject to resistance from local residents that could either prevent or delay exploration and development of its properties.

Environmental Risks

The Company’s exploration and development programs will, in general, be subject to approval by regulatory bodies. Additionally, all phases of the resource business present environmental risks and hazards and are subject to environmental regulation pursuant to a variety of international conventions and state and municipal laws and regulations. Environmental legislation provides for, among other things, restrictions and prohibitions on spills, releases or emissions of various substances produced in association with mining operations. The legislation also requires that mines and facility sites be operated, maintained, abandoned and reclaimed to the satisfaction of applicable regulatory authorities. Compliance with such legislation can require significant expenditures and a breach may result in the imposition of fines and penalties, some of which may be material. Environmental legislation is evolving in a manner expected to result in stricter standards and enforcement, larger fines and liability and potentially increased capital expenditures and operating costs.

Currency Risks

The Company’s financial results are reported in Canadian dollars. The Company’s exploration properties are located in Colombia and Peru and the Company incurs most of its expenditures in United States dollars. Any appreciation in the currency of the United States against the Canadian dollar will increase the Company’s costs of carrying out operations and its ability to continue to finance its operations. Such fluctuations could have a material adverse effect on the Company’s financial results.

Conflicts of Interest

Certain of the directors and officers of the Company will be engaged in, and will continue to engage in, other business activities on their own behalf and on behalf of other companies (including mineral resource companies) and, as a result of these and other activities, such directors and officers may become subject to conflicts of interest. The BCBCA provides that in the event that a director has a material interest in a contract or proposed contract or agreement that is material to an issuer, the director shall disclose his interest in such contract or agreement and shall refrain from voting on any matter in respect of such contract or agreement, subject to and in accordance with the BCBCA. To the extent that conflicts of interest arise, such conflicts will be resolved in accordance with the provisions of the BCBCA and applicable internal corporate governance or board policies where and when applicable.

Political Risks

The Company’s operations may be adversely affected by changes in governmental policies or other economic developments which are not within the control of the Company including a change in taxation policies, economic sanctions, and currency control. The Company is subject to various laws governing exploration, development, production, export of products, taxes, labour standards and occupational health, toxic substances, land use, water use, land claims of local people and other matters. No assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner, which could increase the cost of operations.

Uninsurable Risks

Exploration, development and production operations on resource properties involve numerous risks, including unexpected or unusual geological and/or operating conditions, fires, floods, earthquakes and other environmental occurrences, any of which could result in damage to, or destruction of, producing facilities, damage to life or property, environmental damage and possible legal liability. Although precautions to minimize risk will be taken, operations are subject to hazards that may result in environmental pollution and consequent liability that could have a material adverse impact on the business, operations and financial performance of the Company. It is not always possible to obtain insurance against all such risks and the Company may decide not to insure against certain risks as a result of high premiums or other reasons. Should such liabilities arise, they could have an adverse impact on the Company’s results of operations and financial condition and could cause a decline in the value of the Company’s shares.

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Litigation

The Company and/or its directors may be subject to a variety of civil or other legal proceedings, with or without merit.

Contingencies

• a) During the year ended December 31, 2019, certain employees of Noble in Colombia were registered under the Company’s name with the Columbian tax authorities, without the consent of the Company. The Company has hired a Colombian law firm to unwind this unauthorized registration; however, the Company may face potential claims from these employees with respect to taxes, salaries and social security. The Company intends to vigorously defend against any potential claims, which cannot be reasonably estimated at this time.

• b) During the year ended December 31, 2019, the Company paid $53,784 (US$40,000) to settle all amounts owing under a previous mining lease, which had been fully written off in prior years.

1.15 Other MD&A Requirements

Equity Securities Issued and Outstanding

Common Shares

The Company has one class of common shares. Below is a summary of the common shares, stock options, and warrants issued and outstanding as at December 31, 2020 and the date of this report.

	December 31,	Date of this
	2020	report
Common shares	87,576,100	90,972,231
Stock options	5,325,000	5,075,000
Warrants	31,140,594	27,994,463

Stock Options

The following tranches of stock options are outstanding as of the date of this report:

Number of options	Number of options
outstanding	exercisable	Exerciseprice	Expiry date
		$
75,000	75,000	3.60	March 20, 2024
1,550,000	1,550,000	0.15	January 3, 2025
2,450,000	2,450,000	0.21	August 24, 2025
1,000,000	1,000,000	0.40	November 9, 2025
5,075,000	5,075,000

Warrants

The following tranches of warrants are outstanding as of the date of this report:

Number of warrants
outstanding	Exerciseprice	Expiry date
	$
895,833	0.45	January 17, 2023
641,667	0.72	February 6, 2023
1,133,467	0.90	July 9, 2021
2,887,727	0.10	December 30, 2021
587,500	0.10	May 1, 2022
7,064,118	0.14	August 19, 2021
14,784,151	0.40	October 22, 2021
27,994,463

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Subsequent Events

• a) Subsequent to December 31, 2020, the Company issued 3,146,131 common shares for gross proceeds of $428,458 from the exercise of warrants with an average exercise price was $0.14.

• b) Subsequent to December 31, 2020, the Company issued 250,000 common shares for gross proceeds of $37,500 from the exercise of stock options with an average exercise price was $0.15.

• c) In January 2021, the Company signed a consulting agreement with a consultant to help identify and acquire additional mineral claims around the Company’s CESAR Project. Under the agreement, the consultant will be paid $320,000 upon signing of the agreement and will be granted a 3% net smelter royalty (“NSR”) on all mineral claims currently registered to Valleduper and Baccancas and any claims registered to these companies during 2021. The Company has the right to purchase 100% of the NSR for US$4,000,000 any time prior to production.

• d) In March 2021, the Company incorporated Bocono Colombia Corp. in British Columbia, Canada, a wholly owned subsidiary of Max Resource Corp., and Bocono Colombia Corp. S.A.S. in Colombia, a wholly owned subsidiary of Bocono Colombia Corp.

Other Information

Additional information relating to the Company can be found on or in:

• the Company’s website at www.maxresource.com ;

• SEDAR at www.sedar.com; and

• the Company’s audited consolidated financial statements for the years ended December 31, 2020 and 2019.

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