Psyched Wellness Ltd. — Management Reports 2020

Mar 23, 2020

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Duncan Park Holdings Corporation

Management’s Discussion and Analysis

For the year ended November 30, 2019

Dated March 23, 2020

(Expressed in Canadian Dollars)

Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Introduction

The following is management’s discussion and analysis (“MD&A”) of the results of operations and financial condition of Duncan Park Holdings Corporation (“Duncan Park” or “the Company”) as at and for the year ended November 30, 2019. This MD&A was written to comply with the requirements of National Instrument 51-102 – Continuous Disclosure Obligations. This MD&A should be read in conjunction with the Company’s audited financial statements and related notes for the year ended November 30, 2019 and 2018. The Company’s audited financial statements for the years ended November 30, 2019 and 2018 and the financial information contained in this MD&A are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the IFRS Interpretations Committee (“IFRIC”). In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All figures are in Canadian dollars (“$” or “CAD”) unless stated otherwise.

This MD&A also covers the subsequent period up to March 23, 2020.

Value Creation Strategy

Duncan Park traditionally sought and continues to seek to enhance shareholder value through exploration for gold and other precious metals in Canada and the United States, two (2) of the most politically stable regions of the world. However, given the depressed state of the market for early stage exploration, management has been considering other options which might provide shareholders with increased value sooner than may be possible through the continued exploration for gold.

Funds for the exploration for gold are typically raised by way of private placement of shares and convertible debentures. For planned exploration in Canada, the Company may issue “flow-through” shares pursuant to which the available tax benefits for Canadian Exploration Expenses are transferred from the Company to the investor.

Current Situation

Property

The Company previously acquired a 100% interest in two (2) abutting properties in the Red Lake mining district of Ontario, Canada. The Dome Property comprises 17 unpatented mining claims relating to 40 mining units and covering approximately 504 Hectares (1,245 acres), and the McManus Claims which comprise 17 patented mining claims and 11 licenses of occupation covering approximately 324 hectares (801 acres), for a combined total of approximately 828 hectares (2,046 acres). The Red Lake mining camp has been a major Canadian gold producing district since 1930, with cumulative production estimated to be in excess of 25 million ounces.

Initial exploration of the property was conducted primarily by the use of geophysical studies and analyses to identify targets which were further explored by diamond drilling on land-based claims commencing in the summer of 2011 and on the lake-based claims in the winter of 2012. The Company is encouraged by the results because it believes that it has discovered a previously unidentified mineralized zone running parallel to the main trend defined by three historic Goldcorp mines, and approximately four kilometers south of it.

In addition to its mineral rights, since the earn-in agreement with Camp McMan Red Lake Gold Mines Ltd. included a provision that any unsold surface rights would be included in the earn-in, the Company also holds the surface rights to some property, including six (6) vacant building lots in a subdivided real estate development on the east side of Red Lake, between the towns of Red Lake and Balmertown and two (2) nearby lots totaling 37.4 hectares (93.5 acres). In the 2012 winter drilling program, the Company used two (2) of the building lots in the subdivision as bases for positioning drilling rigs, and may do so in the future. At the end of the first quarter of Fiscal 2016, management determined that, in spite of their possible usefulness for a drilling platform, it should attempt to sell some of the Company’s surface rights to help provide liquidity to pay administrative costs and, accordingly, reclassified these properties as land held for resale in the statement of financial position at the end of first quarter of Fiscal 2016. However, it has since been determined that the market for real estate in Red Lake was generally depressed and the Company has not been able to obtain a reasonable price for any lot, so the Company has taken the surface rights off the market and reclassified them as a long-term asset in the financial statements at the end of the third quarter of Fiscal 2016.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

From a geological perspective, these properties are as valuable as ever. Management is still optimistic that the Company has found a new trend in the Chukuni River basin parallel and close to that being mined by Goldcorp.

The bottom line is still:

1. Duncan Park has a large, clean, land holding in the center of a world-class gold district.

2. There are indications of mineralization at the surface and in drilling.

3. The initial geophysical work has demonstrated that some “targets” are, in fact, sulfide bearing rocks and some of these do contain anomalous gold and pathfinder elements.

4. Throughout the district gold deposits have been found in multiple geologic environments and the science of discovery is still evolving.

5. These permissive geological environments do occur on Duncan Park ground.

However, whereas throughout most of Fiscal 2017, the Company was focused on raising money for gold exploration and discussed the possibility with five potential sources. At this time, the Company has determined that the public company shell itself might be more valuable in a different line of business, such as block-chain or cannabis, and is currently pursuing that course. See “Corporate Restructuring” below.

In November 2019, recognizing the possibility of a change in direction for the Company, management wrote off the carrying value of its exploration and evaluation properties and the associated land to their estimated realizable value which is assessed to be nil.

Financing

Due to the state of the financial markets and the mining industry in general, the Company has had difficulty raising funds for exploration in the past three (3) years (2017 to 2019), other than for a private placement of $250,000 of convertible debentures raised in October 2018.

The Company had previously relied on loans from directors and shareholders to pay its administrative expenses for the past four and a half years. As described below, primarily in “Corporate Restructuring”, except for the most recent $30,000 loans, all of these loans have either been paid or converted into shares.

As at November 30, 2019, the Company had a working capital deficiency of $414,595 (November 30, 2018 – working capital deficiency of $853,469).

The primary reason for the working capital deficiencies was due to administrative expenses incurred related to the ongoing corporate restructuring and debt settlement activities. The Company had implemented certain strategies to mitigate and reduce such costs and other expenses, but there is no guarantee whether these strategies will be successful. These material uncertainties cast significant doubt regarding the Company’s ability to continue as a going concern. These financial statements do not reflect adjustments to the carrying amounts of assets and liabilities, the reported revenues and expenses and the statements of financial position classification used that would be necessary if the going concern assumptions were not appropriate.

Corporate Restructuring

During the year ended November 30, 2019, the Company undertook a series of corporate measures to address its capital and debt structure in order to better position the Company for future opportunities.

Share Consolidation

On December 18, 2018, at Duncan Park’s Annual General Meeting of Shareholders (the “AGM”), shareholders of the Company approved a resolution empowering the Board of Directors (the “Board”) to affect a share consolidation of up to 1 post-consolidation share for every 40 pre-consolidation shares (the “Share Consolidation”). Subsequently, the Board approved a motion to consolidate the Company’s shares at a 40:1 ratio (the “Consolidation Ratio”). Regulatory approval was received on January 29, 2019, and the Share Consolidation was effective February 1, 2019.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

De-Listing

On December 18, 2018, at the AGM, the Company asked shareholders to provide the Board with the discretion to apply to de-list the Company from the TSX Venture Exchange (“TSXV”). This discretion from shareholders was given. The Board believed that having such flexibility may enable the Company to pursue certain opportunities within and/or outside the resource sector. The Board has made no determination as to any future opportunities that it may pursue and there can be no assurance that any future opportunities will be identified or completed. The voluntary delisting was approved by the TSXV on May 4, 2019.

Debt Conversion

On October 9, 2018, the Company completed a private placement of $250,000 (the “Private Placement”) of convertible debentures (the “Debentures”) which have a term of one (1) year and accrued interest at a rate of 10% per annum. On October 9, 2019, 917,800 shares of the Company were issued as a result of the conversion of the Debentures.

Debt Settlement

The Company previously entered into Debt Settlement Agreements dated August 22, 2018 with its two (2) largest creditors: the Estate of Ian McAvity (“the Estate”) and Eric P. Salsberg (“E. Salsberg”), the Chairman of Audit Committee and a director of the Company, which on May 14, 2019, settled $301,989 and $136,664 of outstanding principal amount of term loans (plus accrued interest), respectively, through the full issuance of 1,462,178 common shares of the Company (“the Debt Settlement Shares”). The unsecured loans, which bore interest at a rate of 5% per annum, were made to the Company by the late Ian McAvity, the former President and a director of the Company, and E. Salsberg, in tranches over time to help fund the Company’s ongoing working capital requirements.

After completion of the Share Consolidation, the Debt Settlement Shares were issued at a price based on a deemed preConsolidation Share price of $0.0075 per share multiplied by the Consolidation Ratio. Based on the Consolidation Ratio, the Debt Settlement Shares were issued at an adjusted price of $0.30 per share on May 14, 2019.

A condition of closing of the Private Placement was that the Estate and E. Salsberg were to sell the Debt Settlement Shares to the investors participating in the Private Placement plus one (1) other investor at a price equal to 20% of the principal amount of the debt and accrued interest. Share purchase agreements between the investors, the Estate and E. Salsberg, respectively, were entered and completed on May 14, 2019.

Change of Management

On April 2, 2019, John Langmuir was appointed as Chief Financial Officer (“CFO”) of the Company, replacing the retiring Harold Doran.

On August 31, 2019, David Shaddrick resigned as Acting President and Chief Executive Officer (“CEO”) of the Company but remained on the Board. Brian Presement was appointed as the new President and CEO.

On October 8, 2019, Hasan Zaidi replaced John Langmuir as CFO of the Company.

On January 27, 2020, Keith Li was appointed as the new CFO of Duncan Park, replacing Hasan Zaidi.

On March 5, 2020, Christopher Hazelton was appointed as a director of Duncan Park, following the resignation of David Shaddrick as a director.

Red Lake Property

The Company has acquired a 100% interest in two (2) separate but abutting properties in the Red Lake mining district of northwestern Ontario, Canada, commonly referred to as the “Dome” Property and the “McManus” Claims. The map below shows the location of the claims in relation to the municipality of Red Lake and the surrounding projects including known gold “showings”, and current and past producing mines.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

The Duncan Park Dome/McManus project covers a large land holding in the heart of one (1) of the world’s most productive gold districts. The land holding consists of 17 unpatented mining claims (504 hectares, subject to an underlying 2% NSR royalty), and 17 patented mining claims and 11 licenses of occupation (cumulatively 324 hectares, subject to a 3% underlying NSR royalty), for a total of 828 hectares.

The Red Lake Camp, as evidenced by widespread ore deposits and prospects, is host to a huge, district scale mineral system stretching at least from the Sherritt International deposit in the southwest to the Rubicon F2 Zone in the northeast and including the large Goldcorp mines a short distance from Duncan Park’s property. Given the proper structural setting, any place within this zone is highly prospective for the occurrence of high-grade gold deposits.

Local Geology

The oldest assemblage of rocks in the Red Lake area is the Balmer assemblage (2860-2840 Ma), which is generally comprised of primarily massive tholeiitic basalts with minor felsic volcaniclastic rocks and metasedimentary rocks (Stott and Corfu, 1991). This assemblage is unconformably overlain by the younger Confederation assemblage (2742-2732 Ma), which generally is comprised of intermediate pyroclastics with minor rhyolitic flows and tuffs built on a sequence of mafic to intermediate pillowed flows (Stott and Corfu, 1991). Outcrop exposure becomes diminished eastward as the blanket of glacial overburden increases and topography flattens; best exposures are found on lakeshores and riverbanks.

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Although contiguous, the Dome Property is divided between a northwestern, predominantly water-based block of claims, and a southeastern, predominantly land based block of claims. The McManus property fills in and squares up the block to the north of the south-eastern and east of the north-western Dome claims.

The map below shows that the northwestern block of the Dome claims is at a projected intersection of the Flat Lake – Howey Bay deformation zone (now known as the Madsen Trend) and the Chukuni River deformation zone, and that both zones contain a fault, and that the McManus patents lie along the Chukuni River deformation zone.

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Source: Geological Survey of Canada – Current Research 2000 C-18

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Exploration Program

The Dome/McManus project is an early stage project with significant geological, geophysical and geochemical work completed as well as 21 diamond drill holes totaling 7,016 meters drilled over two years of field work at a cost of $2.7 million.

The Company determined that it was best to explore the property initially using shallow and intermediate depth Induced Polarization (“IP”) geophysical surveys, followed by diamond drilling of selected targets identified.

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The first geophysical study was done on the southeastern, land-based claims of the Dome Property, the only accessible property at the time, in the summer of 2010. After the addition of the adjacent McManus patents later in 2010, a comprehensive geophysical study of the combined properties was performed in the winter of 2011. These resulted in the identification of a number of promising targets.

In the summer/autumn of 2011, the Company conducted a diamond drilling program on the land-based claims of the combined properties which produced encouraging results, particularly on the McManus patents. These were followed up in 2012 by a winter drilling program on the lake-based claims which focused first on the Dome Property at the projected intersection of two (2) deformation zones, and then on an area of interest on the McManus patents. The results are even more encouraging.

On January 28, 2015, a five-man crew from Abitibi Geophysics Inc. (“Abitibi”) of Val-d’Or, Quebec commenced a fourteen-line geophysical exploration of the western, lake-based claims of the Dome Property using that company’s latest version of its IPower 3D technology. The field work was completed in early February 2015. The report by Abitibi indicated that the more modern technology clarified an anomaly adjacent to a previous drill hole and identified a new one south-west of it.

The most important result to date is the identification, pictured above, of a northwesterly trending structural zone with abundant sulfides and anomalous geochemistry. This zone is interpreted to be part of the Chukuni Deformation Zone as defined by the OGS/CGS and is sub-parallel to the Goldcorp mine trend. Thus far, the new zone has been traced across the surface exposure of the Duncan Park McManus Peninsula patented claims and it appears to extend under Duncan Park’s Red Lake unpatented claims.

Eight (8) diamond drill holes drilled by Duncan Park have demonstrated the occurrence of anomalous geochemistry indicating that the zone continues at depth. Gold, both visible and up to 23.5 g/t in analyses, has been identified in quartz veins on the property.

The Company believes that it has discovered a previously unidentified mineralized zone running parallel to the main trend defined by three historic Goldcorp mines, and approximately four kilometers south of it.

The Dome Property interests are subject to 2% Net Smelter Royalty obligations (“NSR”) to the previous property owners, ½ of which may be purchased for $1,750,000. The McManus property interests are subject to 3% NSR to Camp McMan Red Lake Gold Mines Ltd., 1½% of which may be purchased for $500,000 per ½% interest. Minimum annual advance royalty payment of $10,000 per annum commenced in December 2014.

As at November 30, 2019, the Company determined that the uncertainty over the exploration and evaluation (“E&E”) assets and the lack of planned or budgeted substantive expenditures were indicators of impairment. Accordingly, the Company tested the E&E assets for impairment and recorded an impairment of $50,000 on its E&E assets (2018 – $nil) based on a recoverable amount of $nil.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Overall Performance

Selected Annual Information

The Company’s selected financial information for the three (3) most recently completed financial years ended November 30 are summarized as follows:

	November 30,	November 30,	November 30,
	2019	2018	2017
	$	$	$
Operating expenses	(275,119)	(246,882)	(156,543)
Other expenses	(75,000)	(1,507)	(2,323,606)
Net loss	(350,119)	(248,389)	(2,480,149)
Loss per share(1)	(0.086)	(0.079)	(0.787)
Total assets	4,779	137,155	83,028
Total liabilities	419,374	915,624	613,108
Shareholders’ deficiency	(414,595)	(778,469)	(530,080)

(1) The loss per share calculation was adjusted for 40:1 share consolidation effective February 1, 2019

Quarterly Results

The following table presents selected financial data of Duncan Park for its most recent eight (8) quarters:

Period	Net loss ($)	Loss per share ($)(2)
Q4 2019	94,396	0.011
Q3 2019	34,902	0.008
Q2 2019	121,898	0.036
Q1 2019	98,923	0.031
Q4 2018	74,050	0.024
Q3 2018	45,290	0.014
Q2 2018	81,984	0.026
Q1 2018	47,063	0.016

(2) The loss per share calculation was adjusted for 1:40 share consolidation effective February 1, 2019

Financial Activities and Results

The following summary compares the expenses incurred for the years ended November 30, 2019 and 2018:

	2019	2018
	$	$
Expenses
Compensation	28,533	58,434
Professional fees
Consulting	8,000	-
Legal	90,829	81,949
Audit and accounting	33,735	18,275
Regulatory compliance	22,929	27,669
Investor communications	7,481	5,260
Bank charges	1,087	1,368
Interest on convertible debentures	21,436	3,904
Interest on term loans	5,617	19,601
Interest on promissory notes	2,436	-
Office and general	5,861	7,357
Property taxes	4,265	6,975

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Duncan Park Holdings Corporation

Management’s Discussion and Analysis For the year ended November 30, 2019

Amortization of financing costs	32,910	6,090
Annual minimum royalty	10,000	10,000
Total Expenses	275,119	246,882

The overall increase in expenses for the year ended November 30, 2019, as compared to the prior year, is primarily attributed to professional fees, regulatory compliance and interest and amortization of financing costs related to the Debentures transacted in October 2018. Due to the current economic status of the Company, there were no revenues to report. The following discusses some of the significant expenses incurred during the period.

Legal

During the year ended November 30, 2019, legal fees increased to $90,829 compared to $81,949 for the comparative period. The increase was mainly due to the costs related to the corporate reorganization and capital re-structuring initiatives set out in 2018, which continued into Fiscal 2019, including the Share Consolidation, the de-listing from the TSXV and the Debt Settlement transactions.

Audit and Accounting

Total audit and accounting for the year ended November 30, 2019 increased to $33,735, as compared to $18,275 for the comparative period. The increase is primarily due to fees for accounting services due to a change of CFO since the beginning of the year. In terms of audit fees, due to the relative inactivity for the Company in general, lower fees had been accrued by management on the audit for the year ended November 30, 2019.

Regulatory Compliance

Regulatory compliance costs are expected to be consistent from year to year but vary with the number and size of share issues. They include exchange fees, regulatory filing fees, transfer agent fees and timely disclosure costs. The increase in regulatory compliance expenses noted in the year ended November 30, 2019 is principally related to the filing of documents with the TSXV relating to the various restructuring initiatives as noted above.

Interest

The Company had previously issued various debt instruments to finance for its working capital requirements. During the year ended November 30, 2019, the Company incurred interest of $21,436 on the Debentures (2018 – $3,904), interest of $5,617 on the term loans up to their settlement on May 14, 2019 (2018 – $19,601) and interest of $2,436 on promissory notes (2018 – $nil).

Royalty Payment

During the first quarter of 2019, the Company paid the $10,000 annual Advance Minimum Royalty due to Camp McMan Red Lake Gold Mines Inc. with respect to the McManus patented claims.

Related Party Transactions

Key management personnel compensation

Key management includes the Company’s directors and officers with authority and responsibility for planning, directing and controlling the activities of an entity, directly or indirectly.

On April 2, 2019, the Company and Branson Corporate Services Ltd. (“Branson”) entered into a management services agreement, providing for CFO services to the Company, as well as other accounting and administrative services, which are included in professional fees. During the year ended November 30, 2019, the Company was charged $18,000 (2018 – $nil) for services provided by Branson. As at November 30, 2019, an amount of $19,755 (November 30, 2018 – $nil) owing to Branson was included in accounts payable and accrued liabilities. The amount outstanding is unsecured, noninterest bearing and due on demand.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

During the year ended November 30, 2019, the Company was charged USD $15,000 (approximately $20,028) and $8,505 (2018 – USD $22,500 (approximately $28,750) and $14,993) by David Shaddrick, former President and CEO, and Harold Doran, the former CFO, of the Company respectively, for consulting and accounting services provided to the Company. As at November 30, 2019, an amount of USD $90,000 (approximately $119,601) (November 30, 2018 – USD $75,000 (approximately $99,758)) owing to the former President and CEO was included in accounts payable and accrued liabilities.

Also included in accounts payable and accrued liabilities are amounts owing to E. Salsberg, a director of the Company. As at November 30, 2019, an amount of $111,158 (November 30, 2018 – $108,500) was owed to E. Salsberg, for support of funding ongoing administrative expenses.

Working Capital

Currently, the level of operations is principally a function of availability of capital resources. The primary source of funding has been through the completion of private placement financings.

As at November 30, 2019, the Company had total assets of $4,779, total liabilities of $419,374 and total shareholders’ deficiency of $414,595. This compares to total assets of $137,155, total liabilities of $915,624 and total shareholders’ deficiency of $778,469 as at November 30, 2018. The decrease in total liabilities is primarily attributed to the debt settlement through issuance of common shares of the Company during the year.

As at November 30, 2019, the Company had a working capital deficiency of $414,595 (November 30, 2018 – working capital deficiency of $853,469).

Going forward, the Company will continue to rely on equity or debt financings for its working capital requirements. There is no guarantee that the Company will be able to successfully complete such financings, as market conditions may dictate availability and interest.

Off Balance Sheet Arrangements

The Company does not employ any such arrangements

Outstanding Share Data

As at November 30, 2019 and the date of this MD&A, there are 5,531,881 shares issued and outstanding of the Company.

Risk Management

The Company’s financial instruments consist primarily of cash, accounts payable and accrued expenses and promissory notes payable. The Company is exposed to various risks as it relates to these financial instruments. There have not been any changes in the nature of these risks or the process of managing these risks from previous reporting periods.

Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due. The Company’s liquidity and operating results may be adversely affected if the Company’s access to the capital market is hindered, whether as a result of a downturn in stock market conditions generally or related to matters specific to the Company. The Company generates cash flow primarily from its financing activities. As at November 30, 2019, the Company had a cash balance of $1,471 (November 30, 2018 – $55,757) to settle current liabilities of $419,374 (November 30, 2018 – $915,624).

The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet its liabilities as they come due. The Company has undertaken several proposed restructuring initiatives and other corporate measures to rationalize its capital and debt structure to better position the Company for future opportunities and meet its

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

obligations as they come due. Until these initiatives and efforts are finalized, there is no assurance that one or any of these initiatives will be successful.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The majority of the Company’s debts have fixed interest rates. As at November 30, 2019, the Company had no hedging agreements in place with respect to floating interest rates.

Foreign exchange risk

The Company’s exposure to fluctuations in foreign exchange is related to amounts of United States dollars (“USD$”) denominated accounts payable as follows:

minated accounts payable as follows:
	November	30, 2019	November 30,2018
		$	$
Accounts payable and term loans		92,000	78,036

Capital Management

The Company’s objectives when managing capital is to safeguard its ability to continue as a going concern and to provide the funding needed to continue exploration of its properties. Since the Company currently has no commercial operations, this necessitates repetitive approaches to the financial markets and other sources to raise capital in various forms. Due to the Company’s current financial circumstances, there can be no assurance that efforts to raise capital will be successful.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company’s capital management objectives, policies and processes have remained unchanged during the years ended November 30, 2019 and 2018.

The Company is not subject to any externally imposed capital requirements.

Significant Accounting Judgments and Estimates

The preparation of the Company’s financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, revenue and expenses. On an ongoing basis, management evaluates its judgments and estimates in relation to assets, liabilities, revenue and expenses. Management uses historical experience and various other factors it believes to be reasonable under the given circumstances as the basis for its judgments and estimates. Actual outcomes may differ from these estimates under different assumptions and conditions. These estimates are reviewed periodically, and adjustments are made as appropriate in the period they become known. Items for which actual results may differ materially from these estimates are described as follows:

Going concern

At each reporting period, management exercises judgment in assessing the Company’s ability to continue as a going concern by reviewing the Company’s performance, resources and future obligations.

Fair value of financial assets and financial liabilities

Fair value of financial assets and financial liabilities on the statements of financial position that cannot be derived from active markets, are determined using a variety of techniques including the use of valuation models. The inputs to these models are derived from observable market data where possible, but where observable market data are not available, judgment is required to establish fair values. The judgments include, but are not limited to, consideration of model inputs such as volatility, estimated life and discount rates.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Impairment

Long-lived assets, including E&E assets and land, are reviewed for indicators of impairment at each reporting period or whenever events or changes in circumstances indicate that the carrying amount of an asset exceeds its recoverable amount. Impairment is dependent upon estimates of recoverable amounts. These are determined through the exercise of judgments and are dependent upon estimates that take into account factors such as economic and market conditions, frequency of use, anticipated changes in laws, and technological improvements.

Income taxes

Income taxes and tax exposures recognized in the financial statements reflect management’s best estimate of the outcome based on facts known at the reporting date. When the Company anticipates a future income tax payment based on its estimates, it recognizes a liability. The difference between the expected amount and the final tax outcome has an impact on current and deferred taxes when the Company becomes aware of this difference.

In addition, when the Company incurs losses that cannot be associated with current or past profits, it assesses the probability of taxable profits being available in the future based on its budgeted forecasts. These forecasts are adjusted to take account of certain non-taxable income and expenses and specific rules on the use of unused credits and tax losses. When the forecasts indicate the sufficient future taxable income will be available to deduct the temporary differences, a deferred tax asset is recognized for all deductible temporary differences.

Summary of Significant Accounting Policies

Cash

Cash on the statements of financial position comprises bank balances held in Canadian chartered banks, and funds held in trust with the Company’s legal counsel which is available on demand.

Exploration and Evaluation Expenditures

Once the legal right to explore a property has been acquired, costs directly related to E&E expenditures are recognized and capitalized, in addition to the exploration costs. Direct expenditures include such costs as material used, surveying costs, drilling costs and payments made to contractors.

The Company assesses E&E assets for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount. Some facts and circumstances which may be indicative of possible impairment include, but are not limited to: the expiration of the period for which the Company has the right to explore the property or the Company’s intention not to renew that right; substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned; exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the Company has decided to discontinue such activities in the specific area; sufficient data exists to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the E&E asset is unlikely to be recovered in full from successful development or sale.

When a project is deemed to no longer have commercially viable prospects to the Company, E&E assets in respect of that project are deemed to be impaired. The recoverable amount of an E&E asset is the higher of its fair value, less costs to sell, and its value in use. If the carrying amount of an E&E asset exceeds its recoverable amount, an impairment charge is recognized immediately in profit or loss by the amount by which the carrying amount of the E&E asset exceeds the recoverable amount. Where an impairment loss subsequently reverses, the carrying amount of the E&E asset is increased to the lesser of the revised estimate of recoverable amount, and the carrying amount that would have been recorded had no impairment loss been recognized previously.

Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as “mines under construction”. E&E assets are also tested for impairment before the assets are transferred to development properties.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Investments in E&E properties are recorded at cost and are not written down except to the extent that it is determined that their value is impaired. Any impairment loss identified is recognized on the statements of operations and comprehensive loss.

Due to the fact that impairment was identified and the value of the exploration properties had been written down to estimated realizable value in fiscal 2017 and 2019, the normal application of the Company’s accounting principles requires that all further costs be expensed in the statements of operations and comprehensive loss.

Land

Land is carried at cost, subject to estimates for impairment.

Financial Instruments

Financial assets and financial liabilities, including derivatives, are recognized on the statements of financial position when the Company becomes a party to the financial instrument or derivative contract.

Classification

The Company classifies its financial assets and financial liabilities in the following measurement categories: (a) those to be measured subsequently at fair value through profit or loss (“FVTPL”); (b) those to be measured subsequently at fair value through other comprehensive income (“FVTOCI”); and (c) those to be measured at amortized cost. The classification of financial assets depends on the business model for managing the financial assets and the contractual terms of the cash flows. Financial liabilities are classified as those to be measured at amortized cost unless they are designated as those to be measured subsequently at FVTPL (irrevocable election at the time of recognition). For assets and liabilities measured at fair value, gains and losses are recorded in profit or loss.

The Company reclassifies financial assets when its business model for managing those assets changes. Financial liabilities are not reclassified.

Amortized cost

This category includes financial assets that are held within a business model with the objective to hold the financial assets in order to collect contractual cash flows that meet the solely principal and interest (“SPPI”) criterion. Financial asset classified in this category are measured at amortized cost using the effective interest method.

Expected credit loss impairment model

IFRS 9 – Financial Instruments (“IFRS 9”) introduced a single expected credit loss (“ECL”) impairment model, which is based on changes in credit quality since initial application. The adoption of the ECL impairment model had resulted in a provision of ECL recorded on the Company’s statements of loss and comprehensive loss.

The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Company considers a financial asset to be in default when the borrower is unlikely to pay its credit obligations to the Company in full or when the financial asset is more than 90 days past due.

The carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts.

Fair value through profit or loss

This category includes derivative instruments as well as quoted equity instruments which the Company has not irrevocably elected, at initial recognition or transition, to classify at FVTOCI. This category would also include debt instruments whose cash flow characteristics fail the SPPI criterion or are not held within a business model whose objective is either to collect contractual cash flows, or to both collect contractual cash flows and sell. Financial assets in this category are recorded at fair value with changes recognized in profit or loss.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Financial assets at fair value through other comprehensive income

Equity instruments that are not held-for-trading can be irrevocably designated to have their change in FVTOCI instead of through profit or loss. This election can be made on individual instruments and is not required to be made for the entire class of instruments. Attributable transaction costs are included in the carrying value of the instruments. Financial assets at FVTOCI are initially measured at fair value and changes therein are recognized in other comprehensive income (loss).

Measurement

All financial instruments are required to be measured at fair value on initial recognition, plus, in the case of a financial asset or financial liability not at FVTPL, transaction costs that are directly attributable to the acquisition or issuance of the financial asset or financial liability. Transaction costs of financial assets and financial liabilities carried at FVTPL are expensed in profit or loss. Financial assets and financial liabilities with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Financial assets that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are on the principal outstanding are generally measured at amortized cost at the end of the subsequent accounting periods. All other financial assets including equity investments are measured at their fair values at the end of subsequent accounting periods, with any changes taken through profit and loss or other comprehensive income (loss) (irrevocable election at the time of recognition). For financial liabilities measured subsequently at FVTPL, changes in fair value due to credit risk are recorded in other comprehensive income (loss).

The Company’s classification and measurements of financial assets and liabilities are summarized below:

	IFRS 9
Cash	FVTPL
Accounts payable and accrued liabilities	Amortized cost
Term loans	Amortized cost
Promissory notes payable	Amortized cost
Convertible debentures	Amortized cost

Fair value hierarchy

The Company classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

• Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities;

• Level 2 – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

• Level 3 – Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As at November 30, 2019, the Company does not have any financial instruments measured at fair value, other than cash, after initial recognition.

Share Capital

Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. The Company’s common shares are classified as equity instruments. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction from the proceeds.

Loss Per Share

The basic loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the year. The diluted loss per share reflects the potential dilution of common share equivalents, in the weighted average number of common shares outstanding during the year, if dilutive. The “treasury stock method”

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

is used for the assumed proceeds upon the exercise of the options and warrants that are used to purchase common shares at the average market price during the year.

Provisions

A provision is recognized when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of the obligation can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

A provision for onerous contracts is recognized when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract.

As at November 30, 2019 and 2018, the Company had no material provisions.

Income Taxes

Income tax expense comprises current and deferred income tax expense. Current and deferred taxes are recognized in net loss, except to the extent that it relates to items recognized directly in equity or in other comprehensive income (loss).

Current income taxes

Current income taxes are recognized and measured at the amount expected to be recovered from, or payable to, the taxation authorities based on the income tax rates enacted or substantively enacted at the end of the reporting period and includes any adjustment to taxes payable in respect of previous years.

Deferred income taxes

Deferred income taxes are recorded for temporary differences at the date of the statements of financial position between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. The carrying amount of a deferred income tax asset is reviewed at the end of the reporting period and is reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at the end of the reporting period and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the end of the reporting period.

Deferred income tax assets and deferred income tax liabilities are offset if, and only if, they relate to income taxes levied by the same taxation authority and the Company has the legal rights and intent to offset.

Adoption of New Accounting Policies

The Company adopted the following standard, effective December 1, 2018. The changes were made in accordance with the applicable transitional provisions. There was no material impact upon adoption of the new standards on the Company’s financial statements:

IFRS 9 – Financial Instruments

Effective December 1, 2018, the Company adopted all the requirements of IFRS 9 and the related consequential amendments to IFRS 7 – Financial Instruments: Disclosures. IFRS 9 introduces new requirements for:

• Classification and measurement of financial assets and financial liabilities;

• Impairment for financial assets; and

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

• General hedge accounting, which represent a significant change from IAS 39 – Financial Instruments: Recognition and Measurement (“IAS 39”).

As permitted by the transition provisions of IFRS 9, the Company elected not to restate comparative period results. As such, all comparative period information is presented in accordance with the previous accounting policies. Adjustments to the carrying amounts of financial assets and liabilities, at the date of initial application have been recognized in opening deficit and other components of equity for the current period. New or amended interim disclosures have been provided for the current period, where applicable, while comparative period disclosures are consistent with those made in prior periods.

IFRS 9 utilizes a revised model for recognition and measurement of financial instruments and a single, forward-looking “expected loss” impairment model. Most of the requirements in IAS 39 for classification and measurement of financial liabilities were carried forward in IFRS 9, such that the Company’s accounting policy with respect to financial liabilities is unchanged. IFRS 9 contains three (3) principal classification categories for financial assets: measured at amortized cost, FVTOCI and FVTPL. The classification of financial assets under IFRS 9 is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. The standard eliminates the previous IAS 39 categories of held-to-maturity, loans and receivables, and available-for-sale. IFRS 9 replaces the ‘incurred loss’ model in IAS 39 with an ECL model. The new impairment model applies to financial assets measured at amortized cost. Under IFRS 9, credit losses are recognized earlier than under IAS 39.

Recent Accounting Pronouncements

The IASB and the IFRIC have issued certain pronouncements that are mandatory for the Company’s accounting periods commencing on or after December 1, 2019. Many are not applicable or do not have a significant impact to the Company and have been excluded.

IFRS 16 – Leases (“IFRS 16”)

IFRS 16 was issued in January 2016 and replaces IAS 17 – Leases as well as some lease related interpretations. With certain exceptions for leases under twelve months in length or for assets of low value, IFRS 16 states that upon lease commencement a lessee recognizes a right-of-use (“ROU”) asset and a lease liability. The ROU asset is initially measured at the amount of the liability plus any initial direct costs. After lease commencement, the lessee shall measure the ROU asset at cost less accumulated amortization and accumulated impairment. A lessee shall either apply IFRS 16 with full retrospective effect or alternatively not restate comparative information but recognize the cumulative effect of initially applying IFRS 16 as an adjustment to opening equity at the date of initial application. IFRS 16 requires that lessors classify each lease as an operating lease or a finance lease. A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. Otherwise it is an operating lease. IFRS 16 is effective for annual periods beginning on or after December 1, 2019.

The Company has reviewed its leasing arrangements outstanding as at November 30, 2019, in respect of the new lease standard, and had assessed that the impact of adopting this new standard will have on the Company’s financial statements to be immaterial.

IFRIC 23 – Uncertainty Over Income Tax Treatments (“IFRIC 23”)

IFRIC 23 clarifies the accounting for uncertainties in income taxes. The interpretation committee concluded that an entity shall consider whether it is probable that a taxation authority will accept an uncertain tax treatment. If an entity concludes it is probable that the taxation authority will accept an uncertain tax treatment, then the entity shall determine taxable profit (tax loss), tax bases, unused tax losses and credits or tax rates consistently with the tax treatment used or planned to be used in its income tax filings. If an entity concludes it is not probable that the taxation authority will accept an uncertain tax treatment, the entity shall reflect the effect of uncertainty in determining the related taxable profit (tax loss), tax bases, unused tax losses and credits or tax rates. IFRIC 23 is effective for annual periods beginning on or after December 1, 2019. The Company has performed a preliminary analysis and has not assessed any significant impact as a result of the adoption of this standard.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Risk Factors

There are numerous and varied risks, known and unknown, that may prevent the Company from achieving its goals. If any of these risks occur, the Company’s business, financial condition or results of operation may be adversely affected. In such case, the trading price of the Company’s common shares could decline, and investors could lose all or part of their investment. The following is a summary of risks that could be applicable to the business of the Company:

Exploration, development and operating risks

Mining operations generally involve a high degree of risk. The Company’s operations are subject to all the hazards and risks normally encountered in the exploration, development and production of gold, precious metals and other minerals, including unusual and unexpected geologic formations, seismic activity, rock bursts, cave-ins, flooding and other conditions involved in the drilling and removal of material, any of which could result in damage to, or destruction of, mines and other producing facilities, damage to life or property, environmental damage and possible legal liability. Although adequate precautions to minimize risk will be taken, milling operations are subject to hazards such as equipment failure or failure of retaining dams around tailings disposal areas which may result in environmental pollution and consequent liability.

The exploration for and development of mineral deposits involves significant risks which even a combination of careful evaluation, experience and knowledge may not eliminate. While the discovery of a mineral-bearing structure may result in substantial rewards, few properties which are explored are ultimately developed into producing mines.

Major expenses may be required to locate and establish mineral reserves, to develop metallurgical processes and to construct mining and processing facilities at a particular site. It is impossible to ensure that the exploration or development programs planned by the Company will result in a profitable commercial mining operation. Whether a gold or other mineral deposit will be commercially viable depends on a number of factors, some of which are: the particular attributes of the deposit, such as quantity and quality of mineralization and proximity to infrastructure; mineral prices which are highly cyclical; and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in the Company not receiving an adequate return on invested capital.

There is no certainty that the expenditures made by the Company towards the search and evaluation of gold or other minerals will result in discoveries of commercial quantities of gold or other minerals.

Additional financing

The Company believes that its raised capital is sufficient to meet its presently anticipated working capital and capital expenditure requirements for the near future. This belief is based on its operating plan which, in turn, is based on assumptions, which may prove to be incorrect. In addition, the Company may need to raise significant additional funds sooner to support its growth, respond to competitive pressures, acquire or invest in complementary or competitive businesses or technologies, or take advantage of unanticipated opportunities. If its financial resources are insufficient, it will require additional financing to meet its plans for expansion. The Company cannot be sure that this additional financing, if needed, will be available on acceptable terms or at all.

Furthermore, any debt financing, if available, may involve restrictive covenants, which may limit its operating flexibility with respect to business matters. If additional funds are raised through the issuance of equity securities, the percentage ownership of existing shareholders will be reduced, such shareholders may experience additional dilution in net book value, and such equity securities may have rights, preferences or privileges senior to those of its existing shareholders. If adequate funds are not available on acceptable terms or at all, the Company may be unable to develop or enhance its services and products, take advantage of future opportunities, repay debt obligations as they become due, or respond to competitive pressures, any of which could have a material adverse effect on its business, prospects, financial condition, and results of operations.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Volatile global financial and economic conditions

Current global financial and economic conditions remain extremely volatile. Access to public and private capital and financing continues to be negatively impacted by many factors as a result of the global financial crisis and global recession. Such factors may impact the Company’s ability to obtain financing in the future on favorable terms or obtain any financing at all. Additionally, global economic conditions may cause a long-term decrease in asset values. If such global volatility, market turmoil and the global recession continue, the Company’s operations and financial condition could be adversely impacted.

Reliability of resource estimates

There is no certainty that any mineral resources identified in the future on any of the Company’s properties will be realized. Until a deposit is actually mined and processed, the quantity of mineral resources and grades must be considered as estimates only. In addition, the quantity of mineral resources may vary depending on, among other things, metal prices. Any material change in quantity of mineral resources, grade or stripping ratio may affect the economic viability of any project undertaken by the Company. In addition, there can be no assurance that gold recoveries or other metal recoveries in small-scale laboratory tests will be duplicated in a larger scale test under on-site conditions or during production.

Fluctuations in gold and other base or precious metals prices, results of drilling, metallurgical testing and production and the evaluation of studies, reports and plans subsequent to the date of any estimate may require revision of such estimate. Any material reductions in estimates of mineral resources could have a material adverse effect on the Company’s results of operations and financial condition from time to time.

Operating risk and insurance coverage

The Company’s insurance coverage is intended to address all material risks to which it is exposed and is adequate and customary in its current state of operations. However, such insurance is subject to coverage limits and exclusions and may not be available for the risks and hazards to which the Company is exposed. In addition, no assurance can be given that such insurance will be adequate to cover the Company’s liabilities or will be generally available in the future or, if available, that premiums will be commercially justifiable. If the Company were to incur substantial liability and such damages were not covered by insurance or were in excess of policy limits, or if the Company were to incur such liability at a time when it is not able to obtain liability insurance, its business, results of operations and financial condition could be materially adversely affected.

Disruption of business

Conditions or events including, but not limited to, those listed below could disrupt the Company’s operations, increase operating expenses, resulting in delayed performance of contractual obligations or require additional expenditures to be incurred: (i) extraordinary weather conditions or natural disasters such as hurricanes, tornadoes, floods, fires, extreme heat, earthquakes, etc.; (ii) a local, regional, national or international outbreak of a contagious disease, including the COVID-19 coronavirus, Middle East Respiratory Syndrome, Severe Acute Respiratory Syndrome, H1N1 influenza virus, avian flu, or any other similar illness could result in a general or acute decline in economic activity (see also, “Public Health Crises, including COVID-19”); (iii) political instability, social and labour unrest, war or terrorism; or (iv) interruptions in the availability of basic commercial and social services and infrastructure including power and water shortages, and shipping and freight forwarding services including via air, sea, rail and road.

Public health crises

The Company’s business, operations and financial condition could be materially adversely affected by the outbreak of epidemics or pandemics or other health crises beyond our control, including the current outbreak of COVID-19. On January 30, 2020, the World Health Organization declared the COVID-19 outbreak a global health emergency. Many governments have likewise declared that the COVID-19 outbreak in their jurisdictions constitutes an emergency. Reactions to the spread of COVID-19 have led to, among other things, significant restrictions on travel, business closures, quarantines and a general reduction in consumer activity. While these effects are expected to be temporary, the duration of the business disruptions and related financial impact cannot be reasonably estimated at this time.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Such public health crises can result in volatility and disruptions in the supply and demand for various products and services, global supply chains and financial markets, as well as declining trade and market sentiment and reduced mobility of people, all of which could affect interest rates, credit ratings, credit risk and inflation. The risks to the Company of such public health crises also include risks to employee health and safety and a slowdown or temporary suspension of operations in geographic locations impacted by an outbreak. At this point, the extent to which COVID19 may impact the Company is uncertain; however, it is possible that COVID-19 may have a material adverse effect on the Company’s business, results of operations and financial condition.

Environmental risks and hazards

All phases of the Company’s operations are subject to environmental regulation in the jurisdictions in which it operates. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulation, if any, will not adversely affect the Company’s operations. Environmental hazards may exist on the properties on which the Company holds interests which are unknown to the Company at present and which have been caused by previous or existing owners or operators of the properties.

Government approvals and permits are currently and may in the future be required in connection with the Company’s operations. To the extent such approvals are required and not obtained, the Company may be curtailed or prohibited from continuing its exploration or mining operations or from proceeding with planned exploration or development of mineral properties.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions thereunder, 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 mining operations or in the exploration or development of mineral properties may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations.

Amendments to current laws, regulations and permits governing operations and activities of mining and exploration companies, or more stringent implementation thereof, could have a material adverse impact on the Company and cause increases in exploration expenses, capital expenditures or production costs or reduction in levels of production at producing properties or require abandonment or delays in development of new mining properties.

Land title

No assurances can be given that there are no title defects affecting property or any other property interests of the Company. Title insurance generally is not available, and the Company’s ability to ensure that it has obtained secure claim to individual mineral properties or mining concessions may be severely constrained. Furthermore, the Company has not conducted surveys of the claims in which it holds an interest and, therefore, the precise area and location of such claims may be in doubt. Accordingly, the Company’s mineral properties may be subject to prior unregistered liens, agreements, transfers or claims, including native land claims, and title may be affected by, among other things, undetected defects. In addition, the Company may be unable to operate its properties as permitted or to enforce its rights with respect to its properties.

Reliance on management

The success of the Company is dependent on the performance of its senior management. The loss of services of these persons would have a material adverse effect on the Company’s business and prospects in the short-term. There is no assurance the Company can maintain the services of its 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.

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

Risks associated with increasing competition

The mining industry is competitive in all of its phases. The Company faces strong competition from other mining companies in connection with the acquisition of properties producing, or capable of producing, precious and base metals. Many of these companies have greater financial resources, operational experience and technical capabilities than the Company. As a result of this competition, the Company may be unable to maintain or acquire additional attractive mining properties on terms it considers acceptable or at all. Consequently, the Company’s revenues, operations and financial condition could be materially adversely affected.

Factors which may prevent realization of growth targets

The Company is not currently in active operations. There is a risk that the additional resources will be needed, and milestones will not be achieved on time, on budget, or at all, as they are can be adversely affected by a variety of factors, including some that are discussed elsewhere in these risk factors and the following as it relates to the Company:

• delays in obtaining, or conditions imposed by, regulatory approvals;

• facility design errors;

• environmental pollution;

• 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.

Commodity prices

The price of the Company’s common shares, the Company’s financial results, and exploration, development and mineral development activities may in the future be significantly adversely affected by declines in the price of precious metals or other minerals. The price of precious metals and other minerals fluctuates widely and is affected by numerous factors beyond the Company’s control such as the sale or purchase of commodities by various central banks and financial institutions, interest rates, exchange rates, inflation or deflation, fluctuation in the value of the USD and foreign currencies, global and regional supply and demand, the political and economic conditions of major mineral-producing countries throughout the world, and the cost of substitutes, inventory levels and carrying charges. Future serious price declines in the market value of precious metals or other minerals could cause continued development of and commercial production from the Company’s properties to be impracticable. Depending on the price of precious metals and other minerals, cash flow from mining operations may not be sufficient and the Company could be forced to discontinue production and may lose its interest in, or may be forced to sell, some of its properties. Future production from the Company’s mineral exploration properties is dependent upon the prices of precious metals and other minerals being adequate to make these properties economic.

In addition to adversely affecting the Company’s future resource or reserve estimates, if any, and its financial condition, declining commodity prices can impact operations by requiring a reassessment of the feasibility of a particular project. Such a reassessment may be the result of a management decision or may be required under financing arrangements related to a particular project. Even if the project is ultimately determined to be economically viable, the need to conduct such a reassessment may cause substantial delays or may interrupt operations until the reassessment can be completed.

Government regulation

The development and mineral exploration activities of the Company are subject to various laws governing prospecting, development, production, taxes, labour standards and occupational health, mine safety, toxic substances, land use, water use, land claims of local people and other matters. In addition, no assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not otherwise be applied in a manner which could limit or

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

curtail production or development in any of the jurisdictions in which the Company operates. Amendments to other current laws and regulations governing mineral exploration and development or more stringent implementation thereof could also have a substantial adverse impact on the Company.

Management of growth

The Company may be subject to growth-related risks including capacity constraints and pressure on its internal systems and controls. The ability of the Company 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 the Company to deal with this growth may have a material adverse effect on the Company’s business, financial condition, results of operations and prospects.

Dividends

The Company has no earnings or dividend record and does not anticipate paying any dividends on the Company’s shares in the foreseeable future. Dividends paid by the Company would be subject to tax and, potentially, withholdings.

Limited market for securities

There can be no assurance that an active and liquid market for the Company’s shares will develop or be maintained and an investor may find it difficult to resell any securities of the Company.

Disclosure of Internal Controls over Financial Reporting

Management has established processes to provide them sufficient knowledge to support representations that they have exercised reasonable diligence that (i) the audited financial statements do not contain any untrue statement of material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it is made, as of the date of and for the periods presented by the audited financial statements; and (ii) the audited financial statements fairly present in all material respects the financial condition, results of operations and cash flows of the Company, as of the date of and for the periods presented.

In contrast to non-venture issuers, this MD&A does not include representations relating to the establishment and maintenance of disclosure controls and procedures (“DC&P”) and internal control over financial reporting (“ICFR”). In particular, management is not making any representations relating to the establishment and maintenance of: controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in its filings or other reports or submitted under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and a process to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. Investors should be aware that inherent limitations on the ability of management of the Company to design and implement on a cost-effective basis DC&P and ICFR may result in additional risks to the quality, reliability, transparency and timeliness of filings and other reports provided under securities legislation.

Cautionary Note Regarding Forward Looking Statements

This MD&A includes “forward-looking statements”, within the meaning of applicable securities legislation, which are based on the opinions and estimates of management and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “budget”, “plan”, “continue”, “estimate”, “expect”, “forecast”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar words suggesting future outcomes or statements regarding an outlook. Such risks and uncertainties include, but are not limited to, risks associated with the mining industry (including operational risks in exploration development and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections in relation to production, costs and expenses; the uncertainty surrounding the ability of the Company to obtain all permits, consents or authorizations required for its operations and activities; and health safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the ability

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Duncan Park Holdings Corporation Management’s Discussion and Analysis For the year ended November 30, 2019

of Company to fund the capital and operating expenses necessary to achieve the business objectives of the Company, the uncertainty associated with commercial negotiations and negotiating with foreign governments and risks associated with international business activities, as well as those risks described in public disclosure documents filed by the Company. Due to the risks, uncertainties and assumptions inherent in forward-looking statements, prospective investors in securities of the Company should not place undue reliance on these forward-looking statements. Statements in relation to “reserves” are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described can be profitably produced in the future.

Readers are cautioned that the foregoing lists of risks, uncertainties and other factors are not exhaustive. The forwardlooking statements contained in this MD&A are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or in any other documents filed with Canadian securities regulatory authorities, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws. The forward-looking statements are expressly qualified by this cautionary statement.

Management’s Responsibility for Financial Information

Management is responsible for all information contained in this report. The audited financial statements have been prepared in accordance with IFRS and include amounts based on management’s informed judgments and estimates. The financial and operating information included in this report is consistent with that contained in the audited financial statements in all material aspects.

The Audit Committee has reviewed the audited financial statements and this MD&A with management. The Board of Directors has approved the audited financial statements and this MD&A on the recommendation of the Audit Committee.

March 23, 2020

Brian Presement Chief Executive Officer

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