Queen Road Capital Investment : AIF for Year Ended August 31, 2021

QUEEN'S ROAD CAPITAL INVESTMENT LTD.

ANNUAL INFORMATION FORM For the year ended August 31, 2021

Cheung Kong Centre

Suite 2006, 2 Queen's Road Central

Hong Kong

November 22, 2021

QUEEN'S ROAD CAPITAL INVESTMENT LTD.
ANNUAL INFORMATION FORM
TABLE OF CONTENTS
	Page
PRELIMINARY NOTES.................................................................................................................................	3
Effective Date of Information................................................................................................................	3
Currency.................................................................................................................................................	3
Special Note Regarding Forward-Looking Information........................................................................	3
GLOSSARY ......................................................................................................................................................	6
CORPORATE STRUCTURE .........................................................................................................................	7
Name, Address and Incorporation .........................................................................................................	7
Inter-corporate Relationships.................................................................................................................	7
DESCRIPTION AND GENERAL DEVELOPMENT OF THE BUSINESS..............................................	7
Three Year History ................................................................................................................................	7
Year Ended August 31, 2019 Developments.........................................................................................	7
Year Ended August 31, 2020 Developments.........................................................................................	8
Developments Subsequent to August 31, 2020 ...................................................................................	10
DESCRIPTION OF THE BUSINESS ........................................................................................................	111
Summary of the Business ....................................................................................................................	11
Competitive Conditions .......................................................................................................................	16
Key Personnel ......................................................................................................................................	16
Lending ................................................................................................................................................	17
Reorganizations ...................................................................................................................................	18
Social and Environmental Policies ......................................................................................................	18
RISK FACTORS.............................................................................................................................................	18
DIVIDENDS ....................................................................................................................................................	26
DESCRIPTION OF CAPITAL STRUCTURE ...........................................................................................	27
MARKET FOR SECURITIES......................................................................................................................	28
Market ..................................................................................................................................................	28
Trading Price and Volume...................................................................................................................	28
Prior Sales ............................................................................................................................................	28
ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION
ON TRANSFER ..............................................................................................................................................	28
DIRECTORS AND OFFICERS....................................................................................................................	29
Cease Trade Orders, Bankruptcies, Penalties or Sanctions .................................................................	30
Conflicts of Interest .............................................................................................................................	30
LEGAL PROCEEDINGS AND REGULATORY ACTIONS....................................................................	31
PROMOTERS.................................................................................................................................................	31
INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ........................	31
INTEREST OF EXPERTS ............................................................................................................................	32
ADDITIONAL INFORMATION..................................................................................................................	32
AUDIT COMMITTEE...................................................................................................................................	32
SCHEDULE A.................................................................................................................................................	35

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ANNUAL INFORMATION FORM

QUEEN'S ROAD CAPITAL INVESTMENT LTD.

PRELIMINARY NOTES

Effective Date of Information

The information contained in Queen's Road Capital Investment Ltd.'s annual information form ("AIF" or "Annual Information Form") is presented as of August 31, 2021 unless otherwise stated herein. Unless the context otherwise requires, all references to the "Company", "QRC", "we" or "us" shall mean Queen's Road Capital Investment Ltd.

Currency

Unless specified otherwise, all references in the AIF to "C$"are to Canadian dollars, all references to "$" are to United States of America dollars, all references to "A$" are to Australian dollars, and all references to "£" are to British pounds.

Special Note Regarding Forward-Looking Information

Certain statements in this AIF which are not historical in nature constitute "forward looking statements" within the meaning of that phrase under applicable Canadian securities law. These statements include, but are not limited to, statements or information concerning the Company's investments, statements or information concerning the Company's growth strategy and the Company's future performance and business prospects and opportunities. These statements reflect management's current assumptions and expectations and by their nature are subject to certain underlying assumptions, known and unknown risks and uncertainties and other factors which may cause actual results, performance or events to be materially different from those expressed or implied by such forward looking statements.

Forward-looking information can often be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward-looking information is necessarily based on the Company's assumptions as to certain factors such as future currency exchange rates, future interest rates, and while the Company's believes that its assumptions regarding these factors are reasonable, the assumptions may nonetheless prove to be incorrect. Forward looking information also involves known and unknown risks and uncertainties which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. There can be no assurance that such risk factors will not cause actual results to differ materially from those anticipated.

Important assumptions and risks that could cause actual results to differ materially from the Company's expectations are described in the Company's documents filed from time to time with the applicable regulatory authorities and such factors include, but are not limited to:

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• the following assumptions:
• • Share prices: changes in the share price of an investee company may impact the value of the Company's investments which are generally linked to a positive share price performance during the term of the investment;
  • Commodity prices: changes in the relevant commodity prices to an investee company's material assets may impact the value of the Company's investments as it may impact the value of an investee company's assets;
  • Exchange rates: changes in the exchange rates of the functional currencies of investee companies may impact the value of the Company's investments;
  • Interest rates: changes in underlying risk-free interest rates may impact the value of the Company's investments as the underlying discount rate is linked to the investee companies' country's interest rate;
  • Balance sheet strength: changes in an investee company's financial strength may impact the value of the Company's investments as it is important to ensure that an investee company can meet its obligations under the terms of the Company's investments; and
  • Operating assets: material changes at the asset level (operating, permitting or other) of an investee company's may impact the value of the Company's investments if it changes the investee company's ability to meet its obligations under the terms of the Company's investments.
• the following risks:
• • Portfolio exposure and sensitivity to macro-economic conditions: given the nature of the Company's proposed investment activities, the results of operations and financial condition of the Company will be dependent upon the market value of the securities that will comprise the Company's investment portfolio, macro factors such as fluctuations in global political and economic conditions could negatively affect the Company's portfolio of investments;
  • Changes in commodity prices: as an investor in companies in the resource sector, the price of QRC's Common Shares may be indirectly but significantly affected by declines in commodity prices;
  • Natural resource sector risks: investing in natural resource corporations can be speculative in nature and the value of the Company's investments may be subject to significant fluctuations;
  • The Company has no control over exploration, development or mining operations: The inability of the Company to control the activities of the resource issuers in which it has invested may result in a material adverse effect on the results of operations of the Company and its financial condition;
  • Dependence on key personnel: the Company is dependent on the services of a small number of key management personnel. The ability of the Company to manage its activities and its business will depend in large part on the efforts of these individuals, in particular, Warren Gilman, the Company's Chief Executive Officer and a director, whose industry relationships and experience are critical to the Company's success;
  • Cash flow and revenue: the Company's revenue and cash flow will be generated primarily from financing activities, interest payments, dividends, royalty payments on investment and proceeds from the disposition of investments. The availability of these sources of income and the amounts generated from these sources are dependent upon various factors, many of which are outside of the Company's direct control;
  • Private issuers and illiquid securities: the Company may invest in securities of private issuers, illiquid securities of public issuers and publicly-traded securities that have low trading volumes. This may impair the Company's ability to react quickly to market conditions or negotiate the most favourable terms for exiting such investments; and

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• Available opportunities and competition for investments: the Company competes with other companies for investments. Other companies may have greater resources than the Company. Any such competition may prevent the Company from being able to secure new investments;

and other risks and uncertainties referred to under the heading "Risk Factors" in this AIF.

Although the Company has attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking information is made as of the date of this AIF.

With regard to all information included herein relating to companies in the Company's investment portfolio, the Company has relied on information provided by the investee companies and on publicly available information disclosed by the respective companies.

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