ReeXploration Inc. — Management Reports 2021

Aug 11, 2021

BATTERY ROAD CAPITAL CORP. Management Discussion and Analysis Annual Report – April 30, 2021

This Management Discussion and Analysis (“MD&A”) of Battery Road Capital Corp. (“Battery Road” or the “Corporation”) provides analysis of the Corporation’s financial results for the year ended April 30, 2021. The following information should be read in conjunction with the audited financial statements and the notes to the audited financial statements for the years ended April 30, 2021 and 2020, which have been prepared in accordance with International Financial Reporting Standards (“IFRS”). All amounts are expressed in Canadian dollars unless otherwise noted.

This discussion includes certain statements that may be deemed “forward-looking statements”. Forwardlooking statements usually include words such as may, will, would, expect, plan, anticipate, budget, estimates, potential, believe, intend, or other similar words. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing and general economic, market or business conditions. The Corporation does not update or revise forward-looking information even if new information becomes available unless legislation requires us to do so. Investors should not place undue reliance on forward-looking statements. Additional details of the specific risks associated with the operations of the Corporation and such forward-looking statements are set out below under “Risks and Uncertainties”. Investors 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.

During the year ended April 30, 2021 and subsequent to the end of the year, the outbreak of the novel strain of coronavirus, specifically identified as “SARS-CoV-2,” and commonly referred to as “COVID-19”, has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. This has led to significant economic uncertainty, and it is not possible for the Corporation to reliably estimate the length and severity of these developments and the impact on the financial results and conditions of the Corporation at this time.

Date of Report

This MD&A is prepared as of July 30, 2021.

Corporate Profile and Overall Performance

Battery Road Capital Corp. (“Battery Road” or the “Corporation”) was incorporated under the Canada Business Corporations Act on April 20, 2018. The Corporation is classified as a “Capital Pool Company” for the purposes of Policy 2.4 of the TSX Venture Exchange Inc. (the “TSXV” or the “Exchange”). As a result, the Corporation’s principal business is the identification and evaluation of a Qualifying Transaction (“QT”) and once identified or evaluated, to negotiate an acquisition or participation in a business subject to receipt of shareholder approval, if required, and acceptance by regulatory authorities. The Corporation has not conducted commercial operations other than to enter into discussions for the purpose of identifying potential acquisitions or interests.

Until completion of a Qualifying Transaction, the Corporation will not carry on any business other than the identification and evaluation of businesses or assets with a view to completing a potential Qualifying Transaction. With the consent of the Exchange, this may include the raising of additional funds in order to finance an acquisition. Except as described in the Corporation’s prospectus dated August 10, 2018, the

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funds raised pursuant to the Corporation’s Initial Public Offering and any subsequent financing will be utilized only for the identification and evaluation of potential Qualifying Transactions and, to the extent permitted by Policy 2.4, for general and administrative expenses.

Initial Public Offering

On August 10, 2018, the Corporation filed a Prospectus in respect of an Initial Public Offering (“IPO”). The Corporation’s IPO was completed on October 2, 2018 with the issuance of 4,000,000 common shares at a price of $0.10 per share, for gross proceeds of $400,000. The total cost of issuing the shares was $105,696. In connection with the financing, the Corporation entered into an Agency Agreement with Haywood Securities Inc. (the “Agent”). As part of the Agency Agreement, the Agent received a cash commission of 10% of gross proceeds, or $40,000, a corporate finance fee of $10,000, and a legal cost reimbursement of $10,000. Additional costs of the IPO included other legal costs of $24,448. The Agent was also granted an option to acquire 10% of the common shares issued in connection with the IPO at a price of $0.10 per common share, exercisable for a period ending twenty-four months from the date the Corporation’s common shares are listed on the Exchange. These broker warrants were valued at $21,248 using the Black-Scholes valuation method.

The Corporation commenced trading on the Exchange on October 2, 2018 under the symbol BTRY.P.

Qualifying Transaction

On October 2, 2020, the Corporation’s shares were halted by the TSXV as the Corporation was unable to complete a QT within the time period permitted. Subsequent to year end, disinterested shareholders of the Corporation passed a resolution removing the consequences associated with the Corporation not completing a QT within 24 months of its listing date in accordance with certain changes to Exchange Policy 2.4.

On October 14, 2020, the Corporation announced that it has entered into a definitive share exchange agreement (the “Definitive Agreement”) dated as of October 10, 2020 with E-Tech Kalapuse Mining (Pty) Ltd. ("E-Tech Namibia"), an arm’s length party to the Corporation, and the holders of all of the outstanding shares of E-Tech Namibia (the "E-Tech Namibia Shares"), to provide for the completion of a business combination with the Corporation. The combined entity (the "Resulting Issuer") will continue the business of E-Tech Namibia and initially will be engaged in the exploration and development of prospective mineral properties located in Namibia, with a focus on rare earth exploration and development.

On June 2, 2021, the Corporation entered into an agreement amending its Definitive Agreement with E- Tech Namibia. Amendments included (i) a financing be conducted through the issuance of subscription receipts as opposed to a financing conducted by offering shares of E-Tech Namibia (the “Offering”), (ii) the proposed completion of a stock split on the basis of 2 post-split common shares of the Corporation for every 1 pre-split common share, and (iii) the exchange ratio of the Share Exchange has been adjusted for the stock split such that each ordinary share of E-Tech Namibia will convert into 111,111.2 post-split shares of the Corporation.

The agreement with E-Tech Namibia is intended to constitute the Qualifying Transaction of the Corporation, as such term is defined in Policy 2.4 of the TSX-V and will result in a reverse takeover of the Corporation.

To give effect to the amended Definitive Agreement, parties to the agreement will take several actions (collectively, the “Transactions”), including:

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• The Corporation will conduct a 2 for 1 stock split and name change;

• The Corporation will conduct a concurrent financing subscription receipts to convert into postsplit shares of the Corporation;

• Convertible debentures of E-Tech Namibia will convert into ordinary shares of E-Tech Namibia;

• The exchange of shares contemplated in the Definitive Agreement and the additional shares of E-Tech Namibia issued upon conversion of the convertible debentures of E-Tech Namibia will occur;

• Subscription receipts issued under the Offering will convert into post-split shares of the Corporation; and

• The Corporation will enter into a post-transaction support and services agreement with Numus Financial Inc.

As a result of the Transactions, the Corporation will have acquired each of the issued and outstanding E- Tech Namibia Shares pursuant to the terms of the Definitive Agreement, in exchange for 111,111.2 common shares of the Resulting Issuer (the "Exchange Ratio"). Existing shareholders of E-Tech Namibia’s 200 issued and outstanding E-Tech Namibia Shares are expected to receive 22,222,240 common shares of the Resulting Issuer in aggregate at closing of the Transactions. Holders of E-Tech Namibia’s convertible debentures in the amount of $1,596,000 are expected to receive 133 shares of E-Tech Namibia upon conversion, which will be exchanged for 14,777,790 common shares of the Resulting Issuer. It is also expected that 20,000,000 common shares of the Corporation will be issued pursuant to the Offering and conversion into post-split shares of the Corporation.

Effective upon completion of the Transactions, the Resulting Issuer will enter into a Services Agreement with Numus Financial Inc., a related party company owned by significant shareholders of the Corporation. Pursuant to the Services Agreement, Numus Financial Inc. will provide consulting services and controller services for a monthly fee of $10,500 and rent and other office costs at a monthly fee of $1,700, continuing until both parties mutually agree to terminate. Pursuant to the Services Agreement, Numus Financial Inc. will also have a right of first refusal to act as an advisor on future transactions of the Resulting Issuer at a fee of 1.5% of the transaction value. The Services Agreement will be subject to a break fee of $169,200 (18 months of consulting remuneration, six (6) months of controller remuneration and six (6) months of office services) if terminated by the Resulting Issuer without just cause. The Services Agreement will also include a non-solicitation of Numus Financial Inc. employees, with a penalty of $200,000 for non-compliance.

The Transactions are subject to a number of conditions, including the approval of the TSX-V, and have not been completed as of the date of date of this report. There is no guarantee that the Corporation will be able to complete the Transactions.

Results of Operations

Year ended April 30, 2021

The Corporation’s only activity to date has been to attempt to identify businesses with a view to completing a Qualifying Transaction. During the year ended April 30, 2021, the Corporation had a net loss of $231,844 compared to a net loss of $29,874 during the year ended April 30, 2020. The current year loss related primarily to professional fees of $200,086, which included legal fees and expenses related to the Transaction, as well as securities and regulatory expenses of $31,510. During the prior year, the Corporation incurred professional fees of $6,619 and securities and regulatory costs of $21,893.

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Summary of Quarterly Results

The following are the results for the most recent quarters of the Corporation:

	Q4 2021	Q3 2021	Q2 2021	Q1 2021	Q4 2020	Q3 2020	Q2 2020	Q1 2020
	$	$	$	$	$	$	$	$
Net loss for the period	(86,727)	(53,417)	(85,965)	(5,735)	(6,360)	(11,432)	(5,446)	(6,636)
Basic & diluted net loss per share	(0.01)	(0.00)	(0.01)	(0.00)	(0.00)	(0.00)	(0.00)	(0.00)
Total assets	523,822	619,312	660,230	637,694	645,316	647,602	663,510	666,017
Total liabilities	86,762	95,525	83,026	12,575	14,462	10,388	14,864	11,925
Cash dividends per common share	N/A	N/A	N/A	N/A	N/A	N/A	N/A	N/A

Liquidity and Capital Resources

At April 30, 2021, the Corporation had a working capital surplus of $437,060, including cash of $519,835, a decrease of $121,494 from cash of $641,329 as at April 30, 2020. During the year ended April 30, 2021, the Corporation paid $159,544 in operating costs, and 380,500 warrants were exercised for gross proceeds to the Corporation of $38,050. As of the date of this report, the Corporation has not paid dividends and does not have any commitments for capital expenditures.

Management believes the Corporation has sufficient working capital at this time to meet its ongoing financial obligations, however there is no revenue generated from operations, and any additional working capital would require raising additional debt and/or equity capital. Management cannot provide assurance that the Corporation will ultimately achieve profitable operations, become cash flow positive, or raise additional debt and/or equity capital.

Subsequent to year end, the Corporation announced and completed an Offering of subscription receipts at a price of $0.25, each convertible into one post-split of the Corporation share, subject to adjustment if the split does not occur. 20,000,000 subscription receipts were issued for aggregate gross proceeds of $5,000,000. The gross proceeds raised in connection with the Offering, including fees owing to the Agent, will be held in escrow on behalf of the subscribers by Computershare Trust Company of Canada (the “Escrow Agent”).

In connection with the Offering, Numus Capital Corp., a related party (the “Agent”), will receive, conditional upon closing of the share exchange as per the Definitive Agreement (a) a cash commission equal to 7.0% of the aggregate gross proceeds raised by the Corporation from the sale of any subscription receipts in connection with the Offering; and (b) such number of convertible compensation warrants entitling the Agent to purchase that number of post-split shares in the Corporation equal to seven percent (7%) of the subscription receipts in the Offering, with conversion terms adjusted if the split does not occur. This is expected to equate to 1,400,000 post-split shares after exercise of the warrants. The compensation warrants may be exercised for a period of 24 months after the closing of the Transactions.

The escrowed funds, less the fees payable to the Agent, will be released to the Corporation upon receipt by the Escrow Agent of a written joint notice of the Corporation and E-Tech Namibia stating that the share exchange contemplated in the Definitive Agreement has closed, at which time each subscription receipt shall automatically be exchanged for post-split shares.

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Transactions with Related Parties

There were no transactions with related parties and no remuneration paid to key management personnel during the year ended April 30, 2021 or during the year ended April 30, 2020. Key management personnel consists of officers and directors of the Corporation.

Outstanding Share Data

As at April 30, 2021 and July 30, 2021, there were 12,985,750 common shares issued and outstanding with a value of $780,745.

As at April 30, 2021 and July 30, 2021, there were no warrants issued and outstanding. 380,500 warrants were exercised during the year ended April 30, 2021 for gross proceeds of $38,050. The Corporation’s share price on the day the warrants were exercised was $0.25. All remaining warrants expired unexercised on October 2, 2020.

There are no stock options outstanding as at April 30, 2021 or July 30, 2021.

Risks and Uncertainties

The Corporation’s sole objective is to identify a satisfactory Qualifying Transaction. The closing of any proposed Qualifying Transaction is subject to a number of terms and conditions, including completion of due diligence procedures by parties to the transaction and receipt of all required regulatory approvals, and there is no assurance that a transaction will be completed. As the Corporation did not complete a Qualifying Transaction within the time permitted by the Exchange, its common shares were halted on October 2, 2020.

The Corporation does not have a source of income, has not commenced commercial operations, and has no significant assets other than cash. There can be no assurance that the Corporation will be able to raise additional funding in the future on terms acceptable to the Corporation.

The Corporation is exposed to financial instrument related risks. The type of risk exposure and the management of the exposure are as follows:

Credit risk

The Corporation's financial asset is cash. The Corporation's maximum exposure to credit risk, as at year end, is the carrying value of its financial asset. The Corporation mitigates its credit risk by holding cash with high-quality financing institutions or in trust with the Corporation’s lawyer.

Liquidity risk

The Corporation’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As at April 30, 2021, the Corporation had a cash balance of $519,835. The Corporation’s ability to continue to meet its liabilities when due, beyond the current cash balance, is dependent on future support of shareholders through public or private equity offerings.

Off Balance Sheet Transactions

The Corporation does not have any off balance sheet arrangements as at April 30, 2021 or as of the date of this report.

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Significant Accounting Policies

Refer to Note 2 of the audited financial statements for the year ended April 30, 2021 for details of the Corporation’s significant accounting policies and new accounting standards effective for future periods.

Additional Information

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