Stuve Gold Corp. — Management Reports 2021

Apr 30, 2021

STUVE GOLD CORP. Management Discussion and Analysis For the Years ended December 31, 2020 and 2019

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FORM 51-102F1

The following management discussion and analysis (“MD&A”) should be read in conjunction with the Corporation’s audited annual financial statements and notes thereto for year ended December 31, 2020 (the “Audited Statements”). Additional information relating to the Corporation is available on SEDAR at www.sedar.com. The Audited Statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”), which are also generally accepted accounting principles (“GAAP”) for publicly accountable enterprises in Canada.

This MD&A was prepared by management of Stuve Gold Corp. (the “Corporation” or “Stuve Gold”) and was approved by the Board of Directors on April 29, 2021. All amounts are in Canadian dollars unless otherwise stated.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this document constitute “forward-looking statements”. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “propose”, “anticipate”, “believe”, used by any of the Corporation’s management, are intended to identify forward-looking statements. Such statements reflect the Corporation’s forecasts, estimates and expectations, as they relate to the Corporation’s current views based on their experience and expertise with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the Corporation’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The Corporation does not intend, and does not assume any obligation to, update any such factors or to publicly announce the result of any revisions to any of the forwardlooking statements contained herein to reflect future results, events or developments unless required by applicable securities law.

DESCRIPTION OF THE BUSINESS

Big Dougie Capital Corp. was incorporated on December 14, 2017 by Certificate of Incorporation issued pursuant to the provisions of the Business Corporations Act (Alberta). The head office of the Corporation is located at Suite 900, 900 – 8[th] Ave SW, Calgary Alberta, T2P 0P7. The registered office of the Corporation is 1600, 333 – 7[th] Ave SW, Calgary Alberta T2P 2Z1.

The Corporation was classified as a Capital Pool Corporation (“CPC”) as defined in Policy 2.4 of the TSX Venture Exchange (the "Exchange"). On October 2, 2020, the Corporation closed the transactions which constituted its qualifying transaction (“QT Transaction”). On October 8, 2020 the Exchange issued its letter granting final acceptance of the QT Transaction such that the Corporation’s qualifying transaction was fully completed.

On November 13, 2020 the Corporation amended its articles to affect a name change to Stuve Gold Corp. and effected a consolidation of its outstanding common shares on a 3:1 basis. On November 17, 2020, the Corporation’s common shares commenced trading on the facilities of the Exchange under the new name and symbol “STUV” and on the consolidated basis.

CORPORATE REVIEW AND OUTLOOK

Review

During 2020 and in 2021 up to the date of this MD&A, the Corporation completed the following initiatives:

1) Completed a transaction with Compañia Recursos Andina Limitada (“Andina”) which constituted the Corporation’s QT Transaction in accordance with the policies of the Exchange. The QT Transaction was completed by way of a share exchange agreement whereby the Corporation acquired 99.9% of the outstanding partnership interests of Andina which was treated as an asset acquisition for accounting purposes. Concurrent with closing the QT Transaction, the Corporation completed a private placement of common shares for gross proceeds of $1,193,250.

Stuve Gold Corp. - MD&A December 31, 2020

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Andina holds a 100% unencumbered interest in a property located in northern Chile, referred to as the “Coba SW Property”, that management of the Corporation believes is very prospective for gold, copper, silver and cobalt.

2) Completed an option agreement granting the Corporation that ability to earn up to a 90% interest in a second property located in northern Chile.

Management of the Corporation believes that this second property, referred to as the “Punta Alta Property”, is also highly prospective for gold, copper and silver.

3) Entered into a purchase agreement whereby the Corporation may acquire a 100% unencumbered interest in a third property located in northern Chile.

Management of the Corporation believes that this third property, referred to as the “Inca Property” is also highly prospective for gold and copper.

In connection with entering into the Inca Property acquisition agreement, the Corporation announced that it intends to complete a further private placement of common shares for gross proceeds of up to $1,200,000.

4) Completed subsurface mapping and sampling programs from within the two mine shafts located on the Coba SW Property.

Assays results from the program confirmed the historic production grades which indicated significant gold, copper and cobalt grades.

5) Completed a two phased geophysical exploration program on the Coba SW Property including “Induced Polarity” and “Mag” programs. The geophysical programs identified interesting anomalies which justify additional drilling.

6) Competed an initial sampling program at the Punta Alta Property.

Assay results from that sampling program have not yet been returned.

7) Completed a name change and a share consolidation on the basis that three (3) common shares of the Corporation (previously named Big Dougie Capital Corporation) were exchanged for one (1) common share of the Corporation which changed its name to Stuve Gold Corp.

Outlook – Operations and Funding

With the funds remaining raised from the private placement closed in conjunction with the QT Transaction, the Corporation intends to complete an initial 8 to10 hole drilling program on the Coba SW Property. Regulatory approval has been applied for and is expected to be obtained during May such that the drilling program is expected to commence during the second quarter of 2021.

The Corporation intends to complete the private placement announced in conjunction with the Inca Property acquisition (the “Second Private Placement”). With the proceeds from that Second Private Placement, the Corporation intends to complete a check sampling program on the Inca Property during Q2, 2021. The Corporation has been supplied with assay results from a surface sampling program and an induced polarity program already completed by the Inca Property vendors. Consequently, and subject to results from the check sampling program, the Corporation expects that an initial drilling program will be initiated on the Inca Property during Q3, 2021 – funded by the proceeds from the Second Private Placement.

The scope and extent of further work on the Punta Alta property is subject to the results of the first stage sampling program for which assay results have not yet been returned. The Corporation expects that, subject to the first stage assay results, it will continue exploration efforts on the Punta Alta Property that will include further surface geochemistry and sampling followed by further geophysical work that may include well established exploration techniques such as IP, EM, Mag or similar. Estimates on the timing of a potential drilling program on the Punta Alta property are premature at this time.

Stuve Gold Corp. - MD&A December 31, 2020

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Outlook – Commodity Prices

During 2020 and up to the date of this report, commodity prices for the minerals the Corporation is in the process of exploring for have been very robust. Specifically, the prices for gold, silver, copper and cobalt have experienced significant gains. While the Corporation is unable to forecast commodity prices in general, management of the Corporation believes that commodity prices will remain strong based on a post Covid 19 economic recovery.

SELECTED FINANCIAL INFORMATION AND OPERATIONAL REVIEW

December 31 is the date of the Corporation’s fiscal year end.

The following selected financial data is derived from the Audited Statements of the Corporation prepared within acceptable limits of materiality and are in accordance with International Financial Reporting Standards applicable to the preparation of financial statements, including IAS 34.

Selected Statement of Financial Position Data		As at December 31,	As at December 31,	As at December 31,
		2020		2019
Net working capital	$	359,066	$	521,539
Total current assets		463,609		537,346
Total current liabilities		104,543		15,807
Total shareholders’ equity	$	4,112,861	$	521,539
Selected Statement of Operations Data		For the Years Ended December 31,
		2020		2019
Expenses
Professional Fees	$	183,204	$	17,128
General and administrative	$	132,177	$	40,205
Net loss and comprehensive loss	$	634,971	$	57,333
Loss per share	$	(0.09)	$	(0.09)
Weighted average number of shares outstanding	$	7,363,015	$	666,667

Net Income and Cash Flow from Operations

A comprehensive loss of $634,971 resulted for the year ended December 31, 2020 as compared to a comprehensive loss of $57,333 for the comparable period in 2019. The loss in 2020 is largely related to the shared-based compensation of $294,015 and to legal and regulatory expenses related to the QT Transaction of $220,088.

General and Administrative (G&A)

G&A Expenses are comprised of the following:

G&A Expenses are comprised of the following:
		Years ended	December 31,
		2020	2019
Professional fees	$	183,204	$ 17,128
Regulatory fees		76,132	27,005
Business development		32,000	-
Office		13,545	13,200
Consulting fees		10,500	-
	$	315,381	$57,333

Stuve Gold Corp. - MD&A December 31, 2020

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During the year ended December 31, 2020, the Corporation completed its qualifying transaction and incurred legal, professional and regulatory expenses that are considered one-time costs. The Corporation also acquired mineral properties during the fourth quarter and began an exploration program that will result in increased costs going forward. The majority of the costs associated with the exploration program will be capitalized and will appear on the statements of financial position instead of the statements of income or loss.

Capitalized exploration and evaluation expenditures for the year ended December 31, 2020 were $196,120 (2019 - $nil) in addition to the acquisitions listed below.

Mineral properties - exploration and evaluation expenditures

The Corporation’s exploration and evaluation expenditures relate to mineral properties in Chile and are as follows:

ollows:
Balance, December 31, 2019	$	-
Acquisition, Coba property		3,424,425
Acquisition, Santa Gracia		133,250
Lease and capital expenditures		196,120
Balance, December 31, 2020	$	3,753,795

Coba SW

The Corporation acquired 99.9% of the partnership interest of Compañía Recursos Andina Limitada (“Andina”), a limited liability company that holds a 100% interest in a gold, silver, copper and cobalt property in northern Chile, in exchange for the payment of US$500,000 and the issuance of an aggregate 50,000,000 common shares of the Corporation at a deemed price of $0.055 per share. Management determined that the acquisition of Andina did not meet the definition of a business in accordance with IFRS 3 Business Combinations as it did not have the inputs, processes and outputs required to meet the definition of a business. Accordingly, the acquisition has been accounted for as an asset acquisition.

Santa Gracia

Effective November 9, 2020, the Corporation signed an option agreement (the “Agreement”) which provides the Corporation the ability to acquire a 90% undivided right, title and interest in the Santa Gracia property (“Santa Gracia”). The Corporation is entitled to earn the interest according to the following schedule:

• a) To earn an undivided fifty percent interest, the Corporation must:

• (i) Make a cash payment to the optionee totaling US $100,000; and,

• (ii) Incur expenditures on the property totaling US$500,000 during the period that is within 24 months following the execution of the Agreement.

• b) To earn an additional undivided twenty-five percent interest, the Corporation must incur additional expenditures on the Santa Gracia property of US$500,000 on or before the 48[th] month anniversary of execution of the Agreement.

• c) To earn an additional undivided fifteen percent interest, the Corporation must incur additional expenditures on the Santa Gracia property of US$1,000,000 on or before the 60[th] month anniversary of execution of the Agreement.

As at December 31, 2020, the Corporation’s property portfolio in Chile consisted of approximately 12,722 hectares of exploration and exploitation claims.

Mineral Property Expenditure

The mineral properties do not require any minimum work or expenditure commitments other than the commitments under the Santa Gracia option agreement. The Corporation is obligated to make annual tax payments of approximately US$1.50/hectare to the Chilean government in relation to exploration concessions and approximately US$ 7.50/hectare in relation to exploitation claims.

The Corporation has reviewed its mineral properties for impairment indicators as at December 31, 2020 and determined there were no indicators of impairment.

Stuve Gold Corp. - MD&A December 31, 2020

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SHARE CAPITAL

Authorized

Unlimited number of voting Common Shares Unlimited number of Preferred shares issuable in series

Issued Common Shares	Number of Shares	$
As at December 31, 2019	12,000,000	640,782
Shares issued for acquisition of mineral properties	50,000,000	2,750,000
Shares issued for cash	21,695,458	1,193,250
Share issue costs:
Fair value of broker warrants	-	(7,473)
Commissions	-	(10,972)
Share Consolidation 3:1	(55,796,974)	-
As at December 31, 2020	27,898,484	4,565,587

During the year ended December 31, 2020, share capital changed as follows:

• October 2020: in connection with the QT Transaction, 50,000,000 shares were issued for the acquisition of the partnership interest of Compañia Minera Andina Limitada.

• October 2020: in connection with the QT Transaction, the Corporation closed a private placement of 21,695,458 common shares at a price of $0.055 per common share for gross proceeds of $1,193,250.

• Share issue costs of $18,446 include commissions paid totalling $10,972 and $7,473 being the fair value of the brokers’ warrants. Each broker warrant entitles the holder to purchase one common share of the Corporation at a price of $0.165 per share (post-consolidation), expiring twelve months from the date of their issuance.

• November 2020: the common shares of the Corporation were consolidated on a 3:1 basis.

Warrants

A summary of changes to the agent warrants during the years then ended is as follows:

	December	31,	2020	December 31, 2019	December 31, 2019	December 31, 2019
	# of Agent		Weighted	# of Agent		Weighted
	Warrants	Average Price		Warrants		Average
						Price
Balance, beginning of year	200,000	$	0.10	200,000	$	0.10
Granted	66,500	$	0.165	-	$	-
Expired	(200,000)	$	(0.10)	-	$	-
Exercised	-	$	-	-	$	-
Balance end of year	66,500	$	0.165	200,000	$	0.10

The remaining contractual life of the warrants is 0.77 years (2019 – 0.5 years).

The fair value of the warrants has been estimated at the date of grant using the Black-Scholes option pricing model on the following assumptions:

October 8, 2020
Dividend yield	0%
Expected volatility	126%
Risk-free interest rate	0.25%
Forfeiture rate	0%
Share price - issuance	$ 0.21
Term	12 months
Fair value per warrant	$ 0.1124

Stuve Gold Corp. - MD&A December 31, 2020

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Share-based payments

The Corporation has adopted an incentive stock option plan in accordance with the policies of the Exchange (the “Stock Option Plan”) for the benefit of directors, officers, employees and other key personnel of the Corporation. A maximum of 10% of the issued and outstanding common shares of the Corporation are reserved for issuance pursuant to the Stock Option Plan. The number of common shares reserved for issuance to any one person may not exceed five percent (5%) and for consultants shall not exceed two percent (2%) of the issued and outstanding common shares. The Stock Option Plan provides that the terms of the options and the option price shall be fixed by the directors subject to the price restrictions and other requirements imposed by Exchange policies. Stock options granted under the Stock Option Plan may not be exercisable for a period longer than ten (10) years and the exercise price must be paid in full upon exercise of the option.

A summary of the stock option plan and changes during the years then ended is as follows:

	December	31, 2020	31, 2020	December	31, 2019	31, 2019
	# of Stock		Weighted	# of Stock		Weighted
	Options		Average Price	Options		Average Price
Balance, beginning of year(1)	400,000	$	0.30	400,000	$	0.30
Granted	1,283,333	$	0.21	-	$	-
Expired	-	$	-	-	$	-
Exercised	-	$	-	-	$	-
Balance end ofyear	1,683,333	$	0.23	400,000	$	0.30

Note (1) As a result of the 3:1 consolidation

A summary of the stock options outstanding is as follows:

As at December 31, 2020

		Weighted Average
		Remaining
Options	Exercise Price	Contractual Life	Exercisable
Outstanding		(years)	Options	Expiry Date
400,000	$0.30	7.5	400,000	July 11, 2028
1,283,333	$0.21	4.8	427,778	October 2, 2025
1,683,333	$0.23	5.4	827,778

On October 2, 2020 the Corporation issued 1,283,333 stock options, at an exercise price of $0.21 to directors and officers of the Corporation, which vest equally as to one-third each year commencing on the date of grant. The stock options expire on October 2, 2025 and had a fair value of $661,534 on the date of issuance. Stock based compensation expense recognized during the year was $294,015 (2019 – nil).

The fair value of stock options issued was estimated at the date of grant using the Black-Scholes option pricing model using the following assumptions:

	October 2, 2020
Dividend yield	0%
Expected volatility	119%
Risk-free interest rate	0.56%
Forfeiture rate	0%
Share price - issuance	$ 0.21
Term	12 months
Fair value peroption	$ 0.1718

Stuve Gold Corp. - MD&A December 31, 2020

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Income (Loss) per share

The basic and diluted loss per share as calculated is based on the weighted average number of shares outstanding during the year as follows:

	Year ended	December 31,
	2020	2019
Weighted average number of common shares
Issued and outstanding at beginning of the year	666,667	666,667
Effect of share issuance and 3:1 consolidation	6,696,348	-
Weighted average number of common shares –
basic and diluted	7,363,015	666,667

Escrowed Shares

• Included in the opening balance of issued and outstanding shares are 10,000,000 (3,333,333 post consolidation) shares held in escrow. During the year ended December 31, 2020 these shares were transferred from the CPC Escrow Agreement to a voluntary escrow agreement in connection with the QT Transaction (the “Voluntary Escrow Shares”). 5% of the Voluntary Escrow Shares were released on the issuance of the final bulletin issued by the Exchange (the “Final Bulletin”) and the remaining shares will be released in increments of 5%, 10%, 10%, 15%, 15% and 40% on the dates 6 months, 12 months, 18 months, 24 months, 30 months and 36 months following the initial release.

• In connection with the QT Transaction and pursuant to a Surplus Security Escrow Agreement, an additional 63,163,637 (21,054,546 post consolidation) shares were placed escrow to be released from escrow in stages over a period of up to three years from the date of the Final Bulletin. 10% of the common shares held in escrow were released on the issuance of the Final Bulletin. The remaining shares will be released in increments of 5%, 10%, 10%, 15%, 15% and 40% on the dates 6 months, 12 months, 18 months, 24 months, 30 months and 36 months following the initial release.

As at December 31, 2020 there are 23,168,482 shares in escrow. These shares are excluded from the weighted average shares outstanding calculation in the comparative period and included in the calculation after the QT Transaction in October, 2021.

RELATED PARTY TRANSACTIONS

During the years ended December 31, 2020 and 2019, the Corporation incurred expenses with related parties which are included in the Consolidated Statements of Loss and Comprehensive Loss as follows:

Year ended December 31,		2020		2019
Administrative and accounting services provided by an officer	$	2,100	$	-
Legal feespaid to a firm whosepartner is a director	**$ **	117,421	$	7,830

The above transactions were in the normal course of operations and were recorded at fair value.

The related party amounts included in the Consolidated Statements of Financial Position, are as follows:

As at December 31,		2020		2019
Due to officers for administrative and accounting services (included in trade and
other payables)	$	2,100	$	-
Consulting services provided by an officer in Chile (capitalized and included in
Mineral Properties on the statements of Financial Position)		35,993		-
Due to an officer in Chile for consulting services (included in trade and other
payables)		35,993		-
Due to a law firm whose partner is a director		2,136		7,830
Due to a director in Canada	$	6,000	$	-

Stuve Gold Corp. - MD&A December 31, 2020

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SELECTED QUARTERLY INFORMATION

		December 31,	September 30,	September 30,		June 30,		March 31,
Fiscal Quarter Ended		2020		2020		2020		2020
Revenue	$	-	$	-	$	-	$	-
Comprehensive loss	$	(443,642)		(158,994)		(16,289)		(16,046)
Net loss per share
(weighted average – post
consolidation)	$	(0.52)	$	(0.24)	$	(0.02)	$	(0.02)
		December 31,	September 30,			June 30,		March 31,
Fiscal Quarter Ended		2019		2019		2019		2019
Revenue	$	-	$	-	$	-	$	-
Comprehensive loss	$	(4,076)	$	(24,295)	$	(20,964)	$	(7,998)
Net loss per share
(weighted average – post
consolidation)	$	(0.01)	$	(0.04)	$	(0.03)	$	(0.01)

CASH FLOW

For the year ended December 31, 2020 the Corporation’s cash decreased $74,236 (2019 – decreased 48,469). The decrease in cash resulted from cash used in operations of $308,265, cash used in investing activities of $954,249 and cash from financing activities of $1,188,278.

The cash spent on investing activities is related to the acquisition of, and exploration program on, the mineral properties.

CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

Other than the option agreement related to the Santa Gracia property, Stuve Gold is not a party to any industry contracts or obligations and there are no off-balance sheet arrangements.

CRITICAL ACCOUNTING ESTIMATES

There are no critical or material accounting estimates.

Liquidity and Capital Resources

The Corporation's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As at December 31, 2020, the Corporation had a cash balance of $463,110 to settle liabilities of $104,543. Management believes that it has sufficient cash to meet its immediate obligations, however, due to the nature of the mining industry, additional financing will be required in due course. Management will seek additional forms of financing through the issuance of new equity or debt instruments to continue its operations. See also Subsequent Events.

Critical Accounting Estimates and Policies

The Corporation’s significant accounting policies and the adoption of new accounting policies are disclosed in the audited financial statements for the year ended December 31, 2020.

Financial Instruments and Other Instruments

The Corporation’s financial instruments consist of cash and accounts payable and accrued liabilities. It is management’s opinion that the Corporation is not exposed to significant interest, currency or credit risks arising from these financial instruments and that the fair value of these financial instruments approximates their carrying values, as applicable.

Stuve Gold Corp. - MD&A December 31, 2020

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SUBSEQUENT EVENTS

Subsequent to the year ending December 31, 2020, the Corporation entered into a purchase option agreement whereby it may acquire an undivided 100% interest in a mineral property referred to as “Inca”.

The purchase agreement (the “Agreement”) relates to 17 claim packages consisting of 2,941 hectares for a total purchase price of US $6,150,000. The purchase price is payable in four equal payments of US $100,000 with the first payable on signing of the Agreement and three additional payments every six months thereafter. Thereafter, three equal payments of US $150,000 are payable every six months with a balloon payment of $5,300,000 due on the 48[th] month following signing of the Agreement. The Corporation will not earn an interest in the Inca Property until the full purchase price of US $6,150,000 has been paid. The Corporation may stop making payments towards the purchase price at any time whereafter the Corporation is not obligated to make any additional payments towards the purchase price thereafter.

In connection with acquisition, the Corporation intends to complete a non-brokered private placement of up to 6,000,000 units of the Corporation (“Units”) at a price of $0.20 per Unit for gross proceeds of up to $1,200,000 (“Private Placement”). There is no minimum offering. Each Unit will be comprised of one common share of the Corporation (“Common Share”) together with one share purchase warrant (“Warrant”). Each Warrant will entitle the holder to acquire one additional Common Share for a period of two years at a price of $0.35 per Common Share.

BUSINESS RISKS

Mining Industry Risks

The exploration for and development of mineral deposits involves a high degree of risk that even a combination of careful evaluation, experience, knowledge and sufficient financial resources may not eliminate. Whether a mineral deposit will be commercially viable depends on a number of factors, some of which are: the particular attributes of the deposit such as size, grade and proximity to infrastructure; commodity prices which are inherently cyclical and cannot be predicted with certainty; and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. The effect of these factors cannot be accurately predicted and the combination of these factors may result in not receiving an adequate return on invested capital.

Properties Without Known Mineable Reserves

The Corporation’s activities will continue to be directed towards the search for, evaluation of, and development of mineral deposits. There is no assurance that expenditures associated with those activities will result in securing commercial mineral deposits and actual expenditures may be higher than currently anticipated.

Uncertainty as to Calculations of Mineral Deposit Estimates

There is a significant degree of uncertainty attributable to the calculation of mineral deposit estimates. Until the mineral is actually mined and processed, mineral deposit estimates, grades and recovery rates must be considered as estimates only. Consequently, there can be no assurance that any mineral deposit estimates or grade information will prove accurate. In addition, the value of mineral deposits may vary depending on mineral prices and other factors. Any material change in grades, stripping ratios or other mining and processing factors may affect the economic viability of projects. Furthermore, mineral deposit estimate information should not be interpreted as any assurance of mine life or of the potential profitability of existing or future projects.

Uninsurable Risks

The Corporation may become subject to liability for cave-ins, pollution or other hazards against which it cannot insure or against which it may elect not to insure because of high premium costs or for other reasons. The payment of any such liabilities would reduce the funds available for development and mining activities. Payment of liabilities for which the Corporation does not carry insurance may have a material adverse effect on the Corporation’s financial position.

Stuve Gold Corp. - MD&A December 31, 2020

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Currency

Currency fluctuations may materially affect the financial position and results of the Corporation. The Corporation does not intend to engage in currency hedging to offset currency fluctuations risks.

Governmental Regulation of the Mining Industry

The mineral development or exploration activities of the Corporation are subject to various laws governing prospecting, development, production, taxes, labour standards and occupational health, mine safety, toxic substances and other matters. Mining and exploration activities are also subject to various laws and regulations relating to protection of the environment. Although the Corporation believes that its activities are currently carried out in accordance with all applicable rules and regulations, no assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner that could limit or curtail production or development. Amendments to current laws and regulations governing the operations and activities of the Corporation or more stringent implementation thereof could have a material adverse effect on the business, financial condition and results of operations of the Corporation.

Exploration and Development Risks

Resource exploration and development is a speculative business, characterized by a number of significant risks including, among other things, unprofitable efforts resulting not only from the failure to discover deposits but also from finding deposits that, though present, are insufficient in quantity and quality to return a profit from production.

The marketability of resources or reserves acquired or discovered by the Corporation may be affected by numerous factors which are beyond its control and which cannot be accurately predicted; such as market fluctuations, the proximity and capacity of facilities, commodity markets, processing equipment availability and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection, the combination of which factors may result in the Corporation not receiving an adequate return of investment capital.

There is no assurance that the Corporation’s mineral exploration and development activities will result in any discoveries or acquisitions of commercial bodies of minerals. The long-term profitability of the Corporation’s operations will in part be directly related to the costs and success of its development efforts which may be affected by a number of factors. Substantial expenditures are required to establish reserves through drilling and to develop the mining and processing facilities and infrastructure at any site chosen for mining. Although substantial benefits may be derived from the discovery or acquisition of a deposit, no assurance can be given that minerals will be discovered in sufficient quantities to justify commercial operations or that funds required for development can be obtained on a timely basis.

If the Corporation loses or abandons its interest in its properties, there is no assurance that it will be able to acquire another mineral property of merit or that such an acquisition would be approved by the Exchange. There is also no guarantee that the Exchange will approve the acquisition of any additional properties by the Corporation, whether by way of option or otherwise, should the Corporation wish to acquire additional properties.

The business of exploration and development of minerals and mining involves a high degree of risk. Few properties that are explored are ultimately developed into producing mines and there is no guarantee that the Corporation’s new projects will become producing mines.

Insurance

In the course of exploration, development and production of mineral properties, certain risks, and in particular, unexpected or unusual geological operating conditions including rock bursts, cave-ins, fires, flooding and earthquakes may occur. It is not always possible to fully insure against such risks and the Corporation may decide not to take out insurance against such risks as a result of high premiums or other reasons. Should such liabilities arise, they could reduce or eliminate any future profitability and result in increasing costs and a decline in the value of the securities of the Corporation.

Stuve Gold Corp. - MD&A December 31, 2020

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Permits and Licenses

The future operations of the Corporation may require permits from various governmental authorities and will be governed by laws and regulations governing prospecting, development, mining, production, export, taxes, labour standards, occupational health, waste disposal, land use, environmental protections, mine safety and other matters. There can be no guarantee that the Corporation will be able to obtain all necessary permits and approvals that may be required to undertake development activity or commence construction or operation of mine facilities on the Corporation’s properties.

Environmental Legislation

Environmental laws and regulations may affect the operations of the Corporation. These laws and regulations set various standards regulating certain aspects of health and environmental quality. They provide for penalties and other liabilities for the violation of such standards and establish, in certain circumstances, obligations to rehabilitate current and former facilities and locations where operations are or were conducted. The permission to operate can be withdrawn temporarily where there is evidence of serious breaches of health and safety standards, or even permanently in the case of extreme breaches. Significant liabilities could be imposed for damages, clean-up costs or penalties in the event of certain discharges into the environment, environmental damage caused by previous owners of acquired properties or non-compliance with environmental laws or regulations.

In all major developments, the Corporation generally relies on recognized designers and development contractors, from which the Corporation will, in the first instance, seek indemnities. The Corporation intends to minimize risks by taking steps to ensure compliance with environmental, health and safety laws and regulations and operating to applicable environmental standards.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions hereunder, 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, including the Corporation, 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 companies, or more stringent implementation thereof, could have a material adverse impact on the Corporation and cause increases in exploration expenses, capital expenditures or production costs, reduction in levels of production at producing properties, or abandonment or delays in development of new mining properties.

Title to Properties

The acquisition of title to mineral properties is a very detailed and time-consuming process. Title to, and the area of, mineral concessions may be disputed. Although the Corporation believes it has taken reasonable measures to ensure proper title to its properties, there is no guarantee that title to any of its properties will not be challenged or impaired. Third parties may have valid claims underlying portions of the Corporation’s interests.

Market Prices

If the Corporation seeks to bring a property to production, the profitability of its operations will be dependent in part upon the market price of the minerals. Mineral prices fluctuate widely and are affected by numerous factors beyond its control. The level of interest rates, the rate of inflation, the world supply of and demand for mineral commodities, and exchange rate stability can all cause significant price fluctuations. Such external economic factors are in turn influenced by changes in international investment patterns, monetary systems and political developments. The price of commodities has fluctuated widely in recent years, and future price declines could cause commercial production to be impracticable, thereby having a material adverse effect on the Corporation’s business, financial condition and results of operations.

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Competition

The mining industry is intensely competitive in all of its phases and the Corporation will compete with many companies possessing greater financial and technical resources than itself. Competition in the mining industry is primarily for: mineral rich properties which can be developed and produced economically; the technical expertise to find, develop, and operate such properties; the labour to operate the properties; and, the capital for the purpose of funding such properties. Many competitors not only explore for and mine minerals, but conduct refining and marketing operations on a world-wide basis. Such competition may result in the Corporation being unable to acquire desired properties (due to the auction process involved in property acquisition), to recruit or retain qualified employees or to acquire the capital necessary to fund its operations and develop its properties. Existing or future competition in the mining industry could materially adversely affect the Corporation’s prospects for mineral exploration and success in the future.

Additional Financing

The exploration and development of the Corporation’s properties, including continuing exploration and development projects, and the construction of mining facilities and the commencement of mining operations, will require substantial additional financing. Failure to obtain sufficient financing will result in a delay or indefinite postponement of exploration development or production on any or all of the Corporation’s properties or even a loss of a property interest. Sources of funds now available to the Corporation are limited and may include the sale of equity capital, properties, royalty interests, the entering into of future joint ventures and the exercise of outstanding options and warrants. Additional financing may not be available when needed or, even, if available, the terms of such financing might not be favourable to the Corporation and might involve substantial dilution to existing shareholders. Failure to raise capital when needed would have a material adverse effect on the Corporation’s business, financial condition and results of operations.

Competition for Key Personnel

The Corporation will be dependent upon the continued support and involvement of a number of key management personnel. The loss of the services of one or more of such personnel could have a material adverse effect on the Corporation. The Corporation’s ability to manage its exploration and development activities and, hence, its success, will depend in large part on the efforts of these individuals. The Corporation faces intense competition for qualified personnel and there can be no assurance that it will be able to attract and retain such personnel.

Possible Volatility of Stock Price

The market price of the Corporation’s common shares will be subject to wide fluctuations in response to factors such as actual or anticipated variations in the Corporation’s consolidated results of operations, changes in financial estimates by securities analysts, general market consolidated and other factors. Market fluctuations, as well as general economic, political and market conditions such as recessions, interest rate changes or international currency fluctuations may adversely affect the market price of the Corporation’s common shares. Factors such as the price of minerals, announcements by competitors, and changes in stock market analyst recommendations regarding the Corporation, and general market conditions and attitudes affecting other exploration and mining companies may also have a significant effect on the market price of the Corporation’s common shares. Moreover, it is likely that during future quarterly periods, the Corporation’s results and exploration activities may fluctuate significantly or may fail to meet the expectations of stock market analysts and investors and, in such event, the market price of the Corporation’s common shares could be materially adversely affected.

In the past, securities class action litigation has often been initiated following periods of volatility in the market price of a company’s securities. Such litigation, if brought against the Corporation, could result in substantial costs and a diversion of management’s attention and resources, which could have a material adverse effect on the Corporation’s business, financial condition and results of operations.

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Ability to Manage Growth

The size of the Corporation’s business and assets is expected to grow in the coming years. In order to effectively deploy its capital and manage its growth, the Corporation will need to retain additional personnel and augment, improve or replace existing systems and controls. As a result, there can be no assurances that the Corporation will be able to effectively manage its growth and, if it is unable to do so, its business, financial conditions and results could be adversely affected.

Ability to Sell Securities

Securities of the Corporation may be subject to resale restrictions under applicable securities legislation. Accordingly, there may be a long time period between the date of purchase of securities and the date that a shareholder is able to sell these securities. In this time, the market price of the Corporation’s securities will vary. Additionally, there may be limited liquidity in the market for such securities. As such, there is no assurance that the market price at which a shareholder is able to sell any will equal or exceed the price at which the securities were originally issued by the Corporation.

Acquisition Risk

As part of the Corporation’s business strategy, it may seek to grow by acquiring businesses that it believes will complement its current business. The Corporation may not effectively select acquisition candidates or negotiate or finance acquisitions or integrate the acquired businesses and their personnel into its business. The Corporation cannot guarantee that it can complete any acquisition it pursues on favourable terms, or that any completed acquisitions will ultimately benefit its business and results of operations.

The risks inherit with acquisitions include the risks associated with the integration of acquired operations, diversion of management’s attention and potential loss of key employees. The Corporation may not be able to successfully integrate products, technologies or personnel of a business acquired in the future. Such failures could have a material adverse effect on the business, financial condition and results of operations of the Corporation.

Dividends

To date, the Corporation has not paid any dividends on their outstanding shares and does not expect to do so in the foreseeable future. Any decision to pay dividends on the Corporation’s common shares will be made by the Board of Directors of the Corporation on the basis of earnings, financial requirements and other conditions.

Conflicts of Interest

Certain of the directors and officers of the Corporation are engaged in, and will continue to be engaged in, other business activities on their own behalf and on behalf of other companies. As a result of these and other activities, such directors and officers of the Corporation may become subject to conflicts of interest. The Business Corporations Act (Alberta) (“ABCA”) provides that in the event that a director has an interest in a contract or proposed contract or agreement, the director shall disclose his interest in such contract or agreement and shall refrain from voting on any matter in respect of such contract or agreement unless otherwise provided under the ABCA. To the extent that conflicts of interest arise, such conflicts will be resolved in accordance with the provisions of the ABCA.

Other Risks

The Corporation also faces a number of other risk factors that are outside of its control, generally, including, without limitation, natural disasters, general economic and other conditions.

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CORPORATE INFORMATION

CONTACT

Head Office

Stuve Gold Corp. 900, 903 – 8[th] Avenue S.W. Calgary, Alberta T2P 0P7 Tel: (403) 607-4009 E-Mail: al@kasten.ca

AUDITORS

MNP LLP Calgary, Alberta

BANKERS

ATB

Calgary, Alberta

TRANSFER AGENT

Directors and Officers

Al Kroontje, CEO and Director Terence Walker, VP Exploration and Director Jana Lillies, CFO Dale Burstall, Corporate Secretary and Director Jeff Graw, Director

Computershare Trust Corporation Calgary, Alberta

LEGAL COUNSEL

Burstall LLP Calgary, Alberta

Stuve Gold Corp. - MD&A December 31, 2020