BETHANIA SILVER PROJECT

The Bethania Silver project is located in Central Peru, in the northwestern part of Huancavelica Department, approximately 316 km by road from Lima. The project encompasses four concessions totalling 1750 Ha that are accessible year-round via a 4 hour drive from the city of Huancayo. The focus of the project is the Santa Elena concession, a mining concession where the Bethania Silver Mine is located. The project was in production until 2016, toll milling its ore at various concentrate plants in the region.

Historically the mine has produced silver-lead and zinc concentrates from the run-of-mine material until being placed on care and maintenance due to market conditions and lack of working capital. In December 2020, Kuya Silver acquired 100 per cent of the issued and outstanding shares in the capital of S&L Andes Export SAC, the Peruvian company that owns the Bethania mine and holds the mining concession, permits and other rights.

The company has received approval from the regional government of Huancavelica for the semi-detailed environment impact study (EIA) for the Bethania processing plant project. The EIA approval covers a plant design for 350 tonne per day crushing, grinding and flotation circuits, as well as a tailings storage facility and ancillary infrastructure. Kuya plans to implement an expansion and construct a concentrate plant at site before restarting operations in 2021.

Geology & Mineralization

The Bethania Silver Project is located over the Cordillera Central, a region containing prolific and prospective base and precious metals belts. The area is host to numerous styles of mineralisation, including epithermal Au – Ag, porphyry Cu-Au- Mo, and replacement/skarn Zn-Cu. The Bethania Mine is located along an interpreted major north-northeast fault line within Southern Peru’s Au – Ag Epithermal Belt. The Santa Elena Concession (Bethania Mine) covers Tertiary volcanic rocks that include andesite, dacite and tuff. All of the mineralized veins discovered to date are hosted by altered andesite and/or dacite with some anomalous mineralization hosted by silicious bodies of stockwork quartz-breccia.

The focus of past on-vein exploitation has focused on east-northeast trending systems but numerous north – northwest trending veins have seen little if any exploration and testing. The total lengths of the vein system are not clear for all the veins and there is evidence that the northeast-trending veins could extend several hundred meters along strike. In addition, many of the veins continue at depth as evidenced from underground mine developments.

In October 2017, Kuya entered into the original share purchase agreement (the “Share Purchase Agreement”) to acquire 80% of the shares of S&L Andes, a privately held Peruvian company based in Lima that owns 100% of the Bethania Silver Property (Santa Elena concession) and Chinita I concession (collectively referred to as the“Bethania Project”). S&L Andes operated the Bethania Project from 2010 to 2016, by mining ore and trucking the ore to nearby plants for processing into concentrates. S&L Andes ceased mining at the Bethania Project in 2016 and put the mine into care and maintenance at that time.

The Share Purchase Agreement was amended in February 2018, July 2018, February 2019 and June 2020, primarily to extend the closing date for completion and agree on a revised budget for where the funding provided by Kuya would be used. The financial terms from the original Share Purchase Agreement did not materially change, however the February 2019 amendment provided that the cumulative funding provided by Kuya to April 30, 2020 would be converted into shares of S&L Andes, although the shares, if issued, would be restricted until completion of the purchase.

To earn the 80% interest, Kuya was required to make payments totalling $8,000,000 and issue 2,000,000 (pre- RTO) common shares of Kuya to the owners of S&L Andes. The Share Purchase Agreement outlines the following payments to acquire the 80% interest:

● $4,500,000 investment in S&L Andes, consisting of:

● $2,500,000 toward repayment of existing debts and liabilities of S&L Andes; and

● $2,000,000 for working capital to fund ongoing activities of S&L Andes and the Bethania Project, including mine care and maintenance, technical studies on a mine expansion at Bethania, general and administrative expenses, and deal costs.

● $3,500,000 acquisition payment (cash) on closing of the acquisition of S&L Andes.

● 2,000,000 common shares of Kuya at a deemed price of $1.00 on closing of the acquisition of S&L Andes.

Based on the June 2020 amendment to the Share Purchase Agreement, the total investment and payments due on closing were required to be made no later than April 30, 2021 (“Closing Date”). If Kuya reached the Closing Date before the entire investment amount and other payments have been completed or Kuya terminates the agreement prior to the Closing Date, Kuya would receive the proportional ownership of S&L Andes based on a total valuation of $12,500,000.

As at December 31, 2019, Kuya had funded a cumulative total of $3,265,363 for S&L Andes in accordance withthe Share Purchase Agreement, that was recorded as deferred acquisition costs on Kuya’s statement of financial position and as a loan payable to Kuya on the statement of financial position of S&L Andes. During the period from January 1, 2020 to completion of the acquisition on December 15, 2020, Kuya funded a further $1,383,166 for S&L Andes in accordance with the Share Purchase Agreement, for an accumulated total of $4,623,213 of deferred acquisition costs. As part of closing of the acquisition on December 15, 2020, the parties agreed to apply $715,000 of the cumulative funding towards the final payment.

In October 2020, the Company agreed to acquire the remaining 20% interest in S&L Andes for a total of $1,750,000 of cash and shares.

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KUYA SILVER CORPORATION

MANAGEMENT’S DISCUSSION & ANALYSIS(Expressed in US Dollars)

MARCH 31, 2021

Exploration and Evaluation Assets (cont’d...)

Bethania (cont’d...)

On December 15, 2020, the Company completed the purchase of 100% of S&L Andes. As consideration on closing, the Company paid $4,191,822, applied the agreed $715,000 of previous funding as an advance against the final payments and issued a total of 3,929,288 common shares, at a value of $6,084,497 or CAD $1.97 ($1.55) per share. The Company subsequently changed the name of S&L Andes to Minera Toro del Plata