1039-00002 · Torchlight Mining Corp · Legal Opinions

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PENDLETON ROSS LLP Barristers & Solicitors 3400 – 1 First Canadian Place Toronto, Ontario M5X 1A4 Canada

Telephone: (416) 862-4700 Facsimile: (416) 862-4701

April 19, 2022

FORM REVIEWED AND APPROVED BY CALDERWOOD & HARKNESS LLP

Kelvantis Capital Markets LLC 599 Lexington Avenue, 38th Floor New York, NY 10022

Prestige Barrington & Co., Inc. 1285 Avenue of the Americas, 22nd Floor New York, NY 10019

Halcyon Securities Inc. 200 Park Avenue, Suite 3100 New York, NY 10166

(Kelvantis Capital Markets LLC, as Lead Initial Purchaser and Book-Running Manager; Prestige Barrington & Co., Inc. and Halcyon Securities Inc., each as Co-Manager and Initial Purchaser; collectively, the "Initial Purchasers")

Re: $300,000,000 aggregate principal amount of 8.750% Senior Secured Notes due 2029 (the "Notes") issued by Torchlight Mining Corp. (the "Issuer") — Canadian Law Opinion

Ladies and Gentlemen:

1. Introduction

We have acted as Canadian counsel to Torchlight Mining Corp. (the "Issuer" or "TMC"), Wolverine Lake Mining Ltd. ("WLML"), and Torchlight Milling & Processing Inc. ("TMPI" and, together with TMC and WLML, the "Canadian Guarantors") in connection with the offering (the "Offering") of $300,000,000 aggregate principal amount of 8.750% Senior Secured Notes due 2029 (the "Notes") by the Issuer. The Offering is being conducted pursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the "Securities Act"), in transactions exempt from registration under Rule 144A and Regulation S promulgated under the Securities Act.

This opinion letter is being delivered to the Initial Purchasers pursuant to Section 7(d)(iii) of the Purchase Agreement (as defined below) dated March 29, 2022 among the Issuer, the Guarantors named therein, and the Initial Purchasers. This opinion is governed by, and addresses solely matters arising under, the federal laws of Canada and the laws of the Province of Ontario in effect as of the date hereof. The opinions expressed herein have been prepared under the supervision of, and are being delivered by, Marie-Claire Bouchard, a partner of this firm.

2. Defined Terms

As used in this opinion letter, the following terms have the meanings ascribed to them below:

"Canadian General Security Agreement" or "Canadian GSA" means the General Security Agreement dated as of April 19, 2022 among Torchlight Mining Corp., WLML, and TMPI (collectively, as grantors) and Northern Dominion Trust Company (as Collateral Agent), pursuant to which the Canadian Guarantors have granted a security interest in substantially all of their personal property in favour of the Collateral Agent for the benefit of the holders of the Notes.

"Canadian Guarantors" means, collectively, Torchlight Mining Corp. (in its capacity as parent guarantor), WLML, and TMPI.

"CBCA" means the Canada Business Corporations Act, R.S.C. 1985, c. C-44, as amended, together with the regulations promulgated thereunder.

"Collateral Agency Agreement" means the Collateral Agency Agreement dated as of April 19, 2022 among the Issuer, the Guarantors named therein, and Northern Dominion Trust Company, as Collateral Agent.

"Collateral Agent" means Northern Dominion Trust Company, a national banking association organized under the laws of the United States of America, acting in its capacity as Collateral Agent under the Collateral Agency Agreement.

"Guarantees" means the guarantees provided by WLML and TMPI under Article X of the Indenture, being the joint and several, senior secured guarantees of the obligations of the Issuer under the Notes and the Indenture.

"Indenture" means the Indenture dated as of April 19, 2022, among the Issuer, the Guarantors named therein (including Torchlight U.S. Holdings, Inc., a corporation organized under the laws of the State of Delaware), and Northern Dominion Trust Company, as Trustee.

"Issuer" or "TMC" means Torchlight Mining Corp., a corporation incorporated under the CBCA.

"Mining Claims" means Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47, inclusive, as recorded in the Mining Lands Administration System maintained by the Ontario Ministry of Northern Development, Mines, Natural Resources and Forestry.

"Notes" means the 8.750% Senior Secured Notes due 2029 in the aggregate principal amount of $300,000,000 issued by the Issuer under the Indenture.

"OBCA" means the Business Corporations Act (Ontario), R.S.O. 1990, c. B.16, as amended, together with the regulations promulgated thereunder.

"Offering Memorandum" means the Final Offering Memorandum dated March 14, 2022, relating to the Offering.

"PPSA" means the Personal Property Security Act (Ontario), R.S.O. 1990, c. P.10, as amended, together with the regulations promulgated thereunder.

"Purchase Agreement" means the Purchase Agreement dated March 29, 2022, among the Issuer, the Guarantors named therein, and the Initial Purchasers.

"Registration Rights Agreement" means the Registration Rights Agreement dated as of April 19, 2022, among the Issuer, the Guarantors named therein, and the Initial Purchasers.

"TMPI" means Torchlight Milling & Processing Inc., a corporation incorporated under the OBCA.

"Transaction Documents" means, collectively, the Indenture, the Guarantees, the Canadian GSA, the Purchase Agreement, the Registration Rights Agreement, and the Collateral Agency Agreement, in each case to the extent a Canadian Guarantor is a party thereto.

"Trustee" means Northern Dominion Trust Company, acting in its capacity as Trustee under the Indenture.

"WLML" means Wolverine Lake Mining Ltd., a corporation incorporated under the OBCA.

3. Documents and Records Examined

In connection with the opinions expressed herein, we have examined originals or copies (certified or otherwise identified to our satisfaction) of the following documents and records:

(a) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Torchlight Mining Corp., as furnished to us by officers of TMC;

(b) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Wolverine Lake Mining Ltd., as furnished to us by officers of WLML;

(c) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Torchlight Milling & Processing Inc., as furnished to us by officers of TMPI;

(d) a certificate of status issued by the Director appointed under the CBCA with respect to Torchlight Mining Corp. dated April 19, 2022 (the "TMC Status Certificate");

(e) a certificate of status issued by the Ontario Ministry of Government and Consumer Services with respect to Wolverine Lake Mining Ltd. dated April 18, 2022 (the "WLML Status Certificate");

(f) a certificate of status issued by the Ontario Ministry of Government and Consumer Services with respect to Torchlight Milling & Processing Inc. dated April 18, 2022 (the "TMPI Status Certificate");

(g) certified copies of the resolutions of the board of directors of Torchlight Mining Corp. adopted on March 25, 2022, authorizing the execution, delivery, and performance by TMC of the Transaction Documents, the issuance of the Notes, and the granting of the security interests contemplated by the Canadian GSA;

(h) certified copies of the resolutions of the board of directors of Wolverine Lake Mining Ltd. adopted on March 25, 2022, authorizing the execution, delivery, and performance by WLML of the Transaction Documents, including the Guarantee and the Canadian GSA;

(i) certified copies of the resolutions of the board of directors of Torchlight Milling & Processing Inc. adopted on March 25, 2022, authorizing the execution, delivery, and performance by TMPI of the Transaction Documents, including the Guarantee and the Canadian GSA;

(j) written confirmations from the corporate secretaries of each of TMC, WLML, and TMPI that no shareholder approval is required under the CBCA or the OBCA (as applicable) in connection with the transactions contemplated by the Transaction Documents;

(k) the Indenture (execution copy, dated April 19, 2022);

(l) the Guarantees (as contained in Article X of the Indenture);

(m) the Canadian General Security Agreement (execution copy, dated April 19, 2022);

(n) the Collateral Agency Agreement (execution copy, dated April 19, 2022);

(o) the Purchase Agreement (execution copy, dated March 29, 2022);

(p) the Registration Rights Agreement (execution copy, dated April 19, 2022);

(q) the Final Offering Memorandum dated March 14, 2022;

(r) an Officer's Certificate of Torchlight Mining Corp. dated April 19, 2022, executed by Lianne Prokopchuk, Chief Financial Officer, and Deepak Rathore, General Counsel & Corporate Secretary (the "Officer's Certificate");

(s) a Secretary's Certificate of Torchlight Mining Corp. dated April 19, 2022, executed by Deepak Rathore, Corporate Secretary, certifying, among other things, the incumbency of the officers of TMC who executed the Transaction Documents and the constating documents and by-laws of TMC;

(t) a Secretary's Certificate of Wolverine Lake Mining Ltd. dated April 19, 2022, certifying, among other things, the incumbency of the officers of WLML who executed the Transaction Documents and the constating documents and by-laws of WLML;

(u) a Secretary's Certificate of Torchlight Milling & Processing Inc. dated April 19, 2022, certifying, among other things, the incumbency of the officers of TMPI who executed the Transaction Documents and the constating documents and by-laws of TMPI;

(v) the results of searches conducted on April 18, 2022 in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services with respect to each of TMC, WLML, and TMPI (as debtor) (the "PPSA Search Results");

(w) records obtained from the Mining Lands Administration System maintained by the Ontario Ministry of Northern Development, Mines, Natural Resources and Forestry relating to Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47 (the "MLAS Records"); and

(x) such other documents, corporate records, certificates of public officials and of officers and representatives of the Canadian Guarantors, and such other instruments, agreements, and records as we have deemed necessary or advisable for the purposes of rendering the opinions expressed herein.

4. Assumptions

In rendering the opinions set forth in this opinion letter, we have assumed the following without independent verification:

(a) the genuineness of all signatures on all documents examined by us;

(b) the authenticity of all documents submitted to us as originals, and the conformity to original documents of all documents submitted to us as copies (whether certified, photostatic, electronic, or otherwise identified to our satisfaction);

(c) the accuracy, completeness, and truth of all certificates, representations, and statements of fact delivered by officers and directors of the Issuer and the Canadian Guarantors, including the Officer's Certificate and the Secretary's Certificates referred to in Section 3 of this opinion letter, and we have relied upon such certificates, representations, and statements without independent investigation;

(d) that each party to the Transaction Documents (other than the Canadian Guarantors) is duly organized or incorporated, validly existing, and in good standing under the laws of its jurisdiction of organization or incorporation, and has all requisite corporate or other organizational power and authority to own, lease, and operate its assets and to carry on its business as presently conducted;

(e) that each party to the Transaction Documents (other than the Canadian Guarantors) has the requisite corporate or other organizational power, authority, and legal capacity to execute, deliver, and perform its obligations under the Transaction Documents to which it is a party, and that such execution, delivery, and performance have been duly authorized by all necessary corporate or other organizational action on the part of such party;

(f) that the Transaction Documents have been duly authorized, executed, and delivered by each party thereto (other than the Canadian Guarantors, as to which we express opinions below);

(g) that each natural person who executed any of the Transaction Documents or any certificate, instrument, or other document reviewed by us in connection herewith had, at the time of such execution, the requisite legal capacity to do so;

(h) that the choice of the laws of the State of New York as the governing law of the Indenture, the Purchase Agreement, and the Registration Rights Agreement is valid, binding, and enforceable under applicable conflict of laws principles and the laws of the State of New York, it being understood that we are qualified to render opinions only on the laws of Canada (federal) and the Province of Ontario and we express no opinion on the laws of the State of New York or any other jurisdiction of the United States;

(i) that Northern Dominion Trust Company has the requisite power, authority, and capacity under applicable United States federal and state law to act as Trustee under the Indenture and as Collateral Agent under the Collateral Agency Agreement and the Canadian GSA, and that its execution, delivery, and performance of such documents have been duly authorized by all necessary corporate action;

(j) that the certificates of status and certificates of compliance obtained from the Director appointed under the CBCA and the Ontario Ministry of Government and Consumer Services, respectively, referred to in Section 3 of this opinion letter, are accurate as of their respective dates and remain accurate as of the date hereof;

(k) that the descriptions of the personal property described in the Canadian GSA are sufficient to identify and describe such personal property for the purposes of creating a valid security interest therein under the PPSA;

(l) that value has been given by the Collateral Agent (on behalf of the holders of the Notes) in connection with the security interests created under the Canadian GSA within the meaning of the PPSA; and

(m) that the copies of all constating documents and by-laws of the Canadian Guarantors provided to us are complete and accurate and have not been further amended, supplemented, or restated as of the date hereof.

5. Opinions

Based upon and subject to the foregoing and the qualifications and limitations set forth in Section 6 of this opinion letter, and having regard to such legal considerations as we deem relevant, we are of the opinion that:

5.1 Due Organization and Valid Existence — Torchlight Mining Corp.

Torchlight Mining Corp. is a corporation duly incorporated and validly existing under the CBCA. Based on the TMC Status Certificate issued by the Director appointed under the CBCA dated April 19, 2022, TMC is in good standing under the CBCA, meaning that TMC has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of TMC are pending under the CBCA as of such date.

5.2 Due Organization and Valid Existence — Wolverine Lake Mining Ltd.

Wolverine Lake Mining Ltd. is a corporation duly incorporated and validly existing under the OBCA. Based on the WLML Status Certificate issued by the Ontario Ministry of Government and Consumer Services dated April 18, 2022, WLML is in good standing under the laws of the Province of Ontario, meaning that WLML has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of WLML are pending under the OBCA as of such date. WLML has not been cancelled for default under the Corporations Tax Act (Ontario) or the Corporations Information Act (Ontario) and its status is active.

5.3 Due Organization and Valid Existence — Torchlight Milling & Processing Inc.

Torchlight Milling & Processing Inc. is a corporation duly incorporated and validly existing under the OBCA. Based on the TMPI Status Certificate issued by the Ontario Ministry of Government and Consumer Services dated April 18, 2022, TMPI is in good standing under the laws of the Province of Ontario, meaning that TMPI has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of TMPI are pending under the OBCA as of such date. TMPI has not been cancelled for default under the Corporations Tax Act (Ontario) or the Corporations Information Act (Ontario) and its status is active.

5.4 Corporate Power and Authority — Torchlight Mining Corp.

TMC has the corporate power and capacity under the CBCA and its articles of incorporation and by-laws to: (a) issue the Notes; (b) execute, deliver, and perform its obligations under the Indenture, the Purchase Agreement, the Registration Rights Agreement, the Canadian GSA, and the Collateral Agency Agreement; and (c) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.

5.5 Corporate Power and Authority — Wolverine Lake Mining Ltd.

WLML has the corporate power and capacity under the OBCA and its articles of incorporation and by-laws to: (a) execute, deliver, and perform its obligations under the Guarantee (as contained in Article X of the Indenture), the Canadian GSA, and the Collateral Agency Agreement; and (b) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.

5.6 Corporate Power and Authority — Torchlight Milling & Processing Inc.

TMPI has the corporate power and capacity under the OBCA and its articles of incorporation and by-laws to: (a) execute, deliver, and perform its obligations under the Guarantee (as contained in Article X of the Indenture), the Canadian GSA, and the Collateral Agency Agreement; and (b) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.

5.7 Due Authorization — All Canadian Guarantors

The execution, delivery, and performance of the Transaction Documents by each of TMC, WLML, and TMPI have been duly authorized by all necessary corporate action on the part of each such entity, including resolutions of the respective boards of directors of TMC, WLML, and TMPI adopted in accordance with the CBCA or the OBCA (as applicable) and the articles of incorporation and by-laws of each such entity. No approval of the shareholders of TMC is required under the CBCA, and no approval of the shareholders of WLML or TMPI is required under the OBCA, in connection with the execution, delivery, and performance by such entities of the Transaction Documents or the consummation of the transactions contemplated thereby.

5.8 Execution and Delivery

Each of the Transaction Documents to which TMC, WLML, or TMPI is a party has been duly executed and delivered by such entity through its duly authorized officers.

5.9 Enforceability of Guarantees

The Guarantee of each of WLML and TMPI, as contained in the Indenture, constitutes a legal, valid, and binding obligation of such entity, enforceable against such entity in accordance with its terms, subject to the qualifications and limitations set forth in Section 6 of this opinion letter.

5.10 Enforceability of the Canadian General Security Agreement

The Canadian GSA constitutes a legal, valid, and binding obligation of each of TMC, WLML, and TMPI, enforceable against each such entity in accordance with its terms, subject to the qualifications and limitations set forth in Section 6 of this opinion letter.

5.11 Creation of Security Interests under the Canadian GSA

The Canadian GSA creates, in favour of Northern Dominion Trust Company, as Collateral Agent for the benefit of the holders of the Notes, a valid security interest in the personal property of each of TMC, WLML, and TMPI described therein (the "Collateral"), to the extent that a security interest in such personal property can be created under the PPSA. Without limiting the generality of the foregoing, the Collateral described in the Canadian GSA includes, to the extent constituting personal property under the PPSA: (a) equipment; (b) inventory; (c) accounts receivable and other accounts; (d) chattel paper; (e) instruments; (f) documents of title; (g) intangibles, including contractual rights and intellectual property; (h) investment property, including equity interests held by each Canadian Guarantor in its subsidiaries; and (i) such rights and interests in respect of the Mining Claims (being Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47, relating to the Wolverine Lake property comprising approximately 12,400 hectares) and associated surface rights as constitute personal property under the PPSA, in each case whether now owned or hereafter acquired by such Canadian Guarantor.

5.12 Perfection of Security Interests (PPSA)

Upon the filing of financing statements under the PPSA in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services in the name of each of TMC, WLML, and TMPI (as debtor) in favour of Northern Dominion Trust Company, as Collateral Agent (as secured party), the security interests created under the Canadian GSA in those categories of personal property in which a security interest may be perfected by registration under the PPSA will be perfected under the PPSA. We note that the priority of such security interests will be subject to the priority rules set forth in the PPSA and to the rights of any prior registrants or other persons holding a prior interest in the Collateral, as disclosed by the PPSA Search Results or otherwise.

5.13 No Conflict — Canadian Law

The execution, delivery, and performance of the Transaction Documents by each of TMC, WLML, and TMPI do not and will not:

(a) contravene or conflict with the CBCA or the OBCA (as applicable), or the articles of incorporation or by-laws of any such entity;

(b) result in any breach of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, any provision of any agreement, instrument, or other obligation known to us to which any such entity is a party or by which it or any of its property is bound, to the extent such agreement, instrument, or obligation is governed by the laws of Canada (federal) or the Province of Ontario; or

(c) result in a violation of any applicable Canadian federal or Ontario provincial law, statute, regulation, rule, order, or decree known to us to be applicable to any such entity or any of its respective properties or assets.

5.14 Governmental Approvals — Canadian Law

No consent, approval, licence, authorization, or order of, or registration, qualification, designation, declaration, or filing with, any Canadian federal or Ontario provincial governmental authority, agency, or regulatory body is required for the execution, delivery, or performance of the Transaction Documents by any of TMC, WLML, or TMPI, or for the consummation of the transactions contemplated thereby, other than:

(a) the filing of financing statements under the PPSA in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services in respect of the security interests created under the Canadian GSA, which filings have been made or will be made promptly following the closing of the Offering;

(b) notification filings with the Toronto Stock Exchange (the "TSX") as may be required in connection with the incurrence of indebtedness by TMC, which filings are not a condition precedent to the validity or enforceability of the transactions contemplated by the Transaction Documents; and

(c) such filings or notifications as may be required under applicable Canadian securities legislation, including any reporting obligations under National Instrument 51-102 — Continuous Disclosure Obligations or National Instrument 51-101 — Standards of Disclosure for Oil and Gas Activities (to the extent applicable by analogy to mining issuers) or any applicable material change reporting requirements.

5.15 No Proceedings

Based solely upon the Officer's Certificate delivered by Lianne Prokopchuk, Chief Financial Officer, and Deepak Rathore, General Counsel & Corporate Secretary of Torchlight Mining Corp. dated April 19, 2022, and corresponding certificates delivered by authorized officers of WLML and TMPI, and without any independent inquiry or investigation on our part, there are no actions, suits, proceedings, investigations, or claims pending or, to the knowledge of such officers, threatened against TMC, WLML, or TMPI before any Canadian court, tribunal, arbitral body, or governmental authority that would reasonably be expected to materially and adversely affect the validity or enforceability of the Transaction Documents or the ability of any Canadian Guarantor to perform its obligations thereunder.

6. Qualifications and Limitations

The opinions expressed in this opinion letter are subject to the following qualifications and limitations:

6.1 Standard Enforceability Qualifications

The opinions expressed herein as to the enforceability of the Guarantees, the Canadian GSA, and the other Transaction Documents are subject to and may be limited by:

(a) applicable bankruptcy, insolvency, reorganization, moratorium, arrangement, winding-up, liquidation, and other similar laws of general application affecting the enforcement of creditors' rights generally, including, without limitation, the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada), the Winding-up and Restructuring Act (Canada), and the Assignments and Preferences Act (Ontario);

(b) general equitable principles and the equitable discretion of courts of competent jurisdiction, whether such enforcement is sought in a proceeding in equity or at law, including the availability of equitable remedies such as specific performance, injunctive relief, rescission, and declaratory relief, and the doctrines of unconscionability, good faith, fair dealing, and reasonableness;

(c) the Currency Act (Canada), which provides that, unless otherwise expressly stated, all public accounts, obligations, and proceedings in Canada are to be in Canadian currency, and which may require that judgments rendered by Canadian courts be expressed and paid in Canadian currency, notwithstanding any contractual provisions to the contrary requiring payment in United States dollars or any other foreign currency;

(d) the Limitations Act, 2002 (Ontario) and other applicable limitation periods, which may bar the enforcement of rights and remedies under the Transaction Documents after the expiry of the applicable limitation period; and

(e) the general principle that the courts may decline to enforce provisions of the Transaction Documents that are found to be contrary to public policy.

6.2 Security Interest Qualifications

The opinions expressed herein as to the creation, validity, and perfection of the security interests created under the Canadian GSA are subject to and may be limited by the following:

(a) The PPSA does not apply to certain types of property or interests, including liens on interests in real property. To the extent that the Mining Claims (Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47) or the surface rights at the Wolverine Lake property constitute interests in land or interests in mining lands under applicable Ontario law, such interests may not be subject to a security interest created or perfected under the PPSA. Interests in real property, including interests in mining lands, must be separately registered under the Land Titles Act (Ontario) or the Registry Act (Ontario), as applicable, and mining rights and claims must be registered in the Mining Lands Administration System maintained under the Mining Act (Ontario). We express no opinion on the creation or perfection of any security interest or encumbrance in or upon mining claims, mining licences, mining leases, or other interests in mining lands to the extent that registration in the Mining Lands Administration System under the Mining Act (Ontario) has not been completed.

(b) The priority of the security interests created under the Canadian GSA is subject to the priority rules set forth in the PPSA, including, without limitation, the rules relating to purchase-money security interests, and to any prior registrations, prior perfected security interests, or other prior interests in the Collateral. Priority is also subject to any statutory lien, deemed trust, or other priority claim arising under applicable Canadian federal or Ontario provincial legislation, including, without limitation: (i) deemed trusts for unremitted source deductions under subsection 227(4.1) of the Income Tax Act (Canada); (ii) deemed trusts for unremitted goods and services tax or harmonized sales tax under subsection 222(3) of the Excise Tax Act (Canada); (iii) deemed trusts for workers' compensation premiums under the Workplace Safety and Insurance Act, 1997 (Ontario); (iv) deemed trusts or statutory liens for unpaid municipal property taxes; and (v) any other deemed trust or statutory priority that by its terms ranks in priority to a security interest perfected under the PPSA.

(c) After-acquired property provisions contained in the Canadian GSA are subject to the limitations set forth in the PPSA, including, among other things, the subordination of a security interest in after-acquired collateral to a purchase-money security interest that is perfected within the time periods prescribed by the PPSA.

(d) To the extent that the Collateral described in the Canadian GSA includes intellectual property rights that are registrable under applicable federal intellectual property statutes, including the Patent Act (Canada), the Trade-marks Act (Canada), and the Copyright Act (Canada), registration of the security interest or assignment under such federal statutes may be required for full enforceability against third parties. We express no opinion on the effect of any failure to make such registrations.

(e) We express no opinion as to the creation, validity, or perfection of a security interest in any property or assets of the Canadian Guarantors located outside the Province of Ontario. To the extent that any personal property of a Canadian Guarantor is located in a province or territory of Canada other than Ontario, perfection of a security interest in such property may require registration under the personal property security legislation of such other province or territory.

6.3 Limitation to Canadian Federal Law and Ontario Law

This opinion letter is limited solely to the federal laws of Canada and the laws of the Province of Ontario as in effect on the date hereof, and we express no opinion with respect to the laws of any other jurisdiction, including, without limitation, the laws of the State of New York, the State of Delaware, or any other state of the United States, or the federal laws of the United States. We express no opinion on the validity, binding effect, or enforceability of any provision of the Transaction Documents to the extent that such provision is governed by the laws of the State of New York or any other jurisdiction outside Canada. We express no opinion on the application or effect of the laws of any foreign jurisdiction on any of the matters addressed herein.

6.4 Other Qualifications

(a) This opinion does not address, and we express no opinion on, the tax consequences of the transactions contemplated by the Transaction Documents, including, without limitation, any consequences arising under the Income Tax Act (Canada), the Excise Tax Act (Canada), or any provincial tax legislation.

(b) This opinion does not address, and we express no opinion on, compliance with the securities laws of any jurisdiction other than Canada and the Province of Ontario, and we note that we have not been asked to, and do not, opine on compliance with the registration and prospectus requirements of Canadian securities legislation in connection with the Offering.

(c) This opinion does not address, and we express no opinion on, the financial condition or solvency of any of the Canadian Guarantors or the adequacy of consideration received by any Canadian Guarantor in connection with its execution and delivery of the Guarantees or the Canadian GSA. We note that the enforceability of the Guarantees and the Canadian GSA may be subject to challenge on the basis that the relevant Canadian Guarantor was insolvent or rendered insolvent at the time of the granting of such Guarantee or security interest, or that such Guarantee or security interest was granted for inadequate consideration, under applicable provincial fraudulent conveyance legislation (including the Fraudulent Conveyors Act (Ontario)), the Assignments and Preferences Act (Ontario), Section 96 of the Bankruptcy and Insolvency Act (Canada), or Section 36.1 of the Companies' Creditors Arrangement Act (Canada), and we express no opinion on the applicability or effect of any such legislation to or upon the Guarantees or the Canadian GSA.

(d) Provisions of the Transaction Documents that purport to constitute waivers of rights may not be enforceable to the extent that such provisions purport to waive rights that cannot be waived as a matter of applicable law or public policy, including, without limitation, rights that are conferred by statute and expressed to be non-waivable.

(e) Severability clauses contained in the Transaction Documents, while generally upheld by Canadian courts, are subject to the discretion of the court before which such clauses are sought to be enforced, and a court may decline to enforce any provision of the Transaction Documents that it determines to be illegal, void, or unenforceable, notwithstanding any severability provision.

(f) Indemnification and contribution provisions contained in the Transaction Documents may be limited or found unenforceable under applicable law, including, without limitation, the principle that a person may not be indemnified against the consequences of its own fraud, negligence, wilful misconduct, or breach of fiduciary duty, and the general principle that indemnification provisions that are contrary to public policy or that purport to indemnify a party against criminal liability or regulatory sanctions may not be enforceable.

(g) We express no opinion with respect to any provision of the Transaction Documents that purports to restrict access to courts or to waive the right to trial by jury, to the extent such provisions may be unenforceable under applicable Canadian law.

7. Reliance and Other Matters

This opinion letter is rendered solely for the benefit of the Initial Purchasers, being Kelvantis Capital Markets LLC, Prestige Barrington & Co., Inc., and Halcyon Securities Inc., in connection with the transactions contemplated by the Purchase Agreement and the other Transaction Documents. This opinion letter may also be relied upon by:

(a) Calderwood & Harkness LLP, as U.S. counsel to the Issuer, solely in connection with the opinions being delivered by such firm on the date hereof in relation to the Offering and the Transaction Documents;

(b) Clairmont & Voss LLP, as U.S. counsel to the Initial Purchasers, solely in connection with the opinions being delivered by such firm on the date hereof in relation to the Offering and the Transaction Documents; and

(c) Northern Dominion Trust Company, in its capacity as Trustee under the Indenture and as Collateral Agent under the Collateral Agency Agreement and the Canadian GSA, solely in connection with the transactions contemplated by the Transaction Documents.

This opinion letter may not be relied upon by any other person or entity, or for any purpose other than as described herein, without our prior written consent, and no person or entity other than those expressly named above as addressees or permitted reliance parties is entitled to rely on this opinion letter.

This opinion letter speaks only as of the date hereof, and we undertake no obligation, and hereby disclaim any obligation, to update or supplement this opinion letter for any changes in fact or law that may occur or become known to us after the date hereof, regardless of whether such changes may affect the opinions expressed herein.

We hereby consent to the filing of this opinion letter as an exhibit to the Offering Memorandum or as may otherwise be required in connection with the Offering, and to reference to this firm under the heading "Legal Matters" in the Offering Memorandum. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under applicable securities legislation.

This opinion letter is governed by, and shall be construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein.

8. Closing

We trust that the foregoing is satisfactory for your purposes. Please do not hesitate to contact the undersigned should you require any further information or clarification.

Very truly yours,

PENDLETON ROSS LLP

By: ________

Name: Marie-Claire Bouchard

Title: Partner

Securities & Corporate Finance

cc:

Torchlight Mining Corp.

Attention: Deepak Rathore, General Counsel & Corporate Secretary

2200 – 400 Burrard Street Vancouver, BC V6C 3A6

Calderwood & Harkness LLP

Attention: Vivienne St. Claire

450 Park Avenue New York, NY 10022

Clairmont & Voss LLP

Attention: Harrison Voss

51 West 52nd Street New York, NY 10019

Northern Dominion Trust Company

Attention: Sandra Leung, VP, Corporate Trust

101 Barclay Street, 7th Floor New York, NY 10286

Form reviewed and approved by Calderwood & Harkness LLP — Matter No. 1039-00002 — Reviewed by Audrey Zhou; approved by Vivienne St. Claire

PENDLETON ROSS LLP Barristers & Solicitors 3400 – 1 First Canadian Place Toronto, Ontario M5X 1A4 Canada
Telephone: (416) 862-4700 Facsimile: (416) 862-4701
April 19, 2022
FORM REVIEWED AND APPROVED BY CALDERWOOD & HARKNESS LLP
Kelvantis Capital Markets LLC 599 Lexington Avenue, 38th Floor New York, NY 10022
Prestige Barrington & Co., Inc. 1285 Avenue of the Americas, 22nd Floor New York, NY 10019
Halcyon Securities Inc. 200 Park Avenue, Suite 3100 New York, NY 10166
(Kelvantis Capital Markets LLC, as Lead Initial Purchaser and Book-Running Manager; Prestige Barrington & Co., Inc. and Halcyon Securities Inc., each as Co-Manager and Initial Purchaser; collectively, the "Initial Purchasers")
Re: $300,000,000 aggregate principal amount of 8.750% Senior Secured Notes due 2029 (the "Notes") issued by Torchlight Mining Corp. (the "Issuer") — Canadian Law Opinion
Ladies and Gentlemen:
1. Introduction
We have acted as Canadian counsel to Torchlight Mining Corp. (the "Issuer" or "TMC"), Wolverine Lake Mining Ltd. ("WLML"), and Torchlight Milling & Processing Inc. ("TMPI" and, together with TMC and WLML, the "Canadian Guarantors") in connection with the offering (the "Offering") of $300,000,000 aggregate principal amount of 8.750% Senior Secured Notes due 2029 (the "Notes") by the Issuer. The Offering is being conducted pursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the "Securities Act"), in transactions exempt from registration under Rule 144A and Regulation S promulgated under the Securities Act.
This opinion letter is being delivered to the Initial Purchasers pursuant to Section 7(d)(iii) of the Purchase Agreement (as defined below) dated March 29, 2022 among the Issuer, the Guarantors named therein, and the Initial Purchasers. This opinion is governed by, and addresses solely matters arising under, the federal laws of Canada and the laws of the Province of Ontario in effect as of the date hereof. The opinions expressed herein have been prepared under the supervision of, and are being delivered by, Marie-Claire Bouchard, a partner of this firm.
2. Defined Terms
As used in this opinion letter, the following terms have the meanings ascribed to them below:
"Canadian General Security Agreement" or "Canadian GSA" means the General Security Agreement dated as of April 19, 2022 among Torchlight Mining Corp., WLML, and TMPI (collectively, as grantors) and Northern Dominion Trust Company (as Collateral Agent), pursuant to which the Canadian Guarantors have granted a security interest in substantially all of their personal property in favour of the Collateral Agent for the benefit of the holders of the Notes.
"Canadian Guarantors" means, collectively, Torchlight Mining Corp. (in its capacity as parent guarantor), WLML, and TMPI.
"CBCA" means the Canada Business Corporations Act, R.S.C. 1985, c. C-44, as amended, together with the regulations promulgated thereunder.
"Collateral Agency Agreement" means the Collateral Agency Agreement dated as of April 19, 2022 among the Issuer, the Guarantors named therein, and Northern Dominion Trust Company, as Collateral Agent.
"Collateral Agent" means Northern Dominion Trust Company, a national banking association organized under the laws of the United States of America, acting in its capacity as Collateral Agent under the Collateral Agency Agreement.
"Guarantees" means the guarantees provided by WLML and TMPI under Article X of the Indenture, being the joint and several, senior secured guarantees of the obligations of the Issuer under the Notes and the Indenture.
"Indenture" means the Indenture dated as of April 19, 2022, among the Issuer, the Guarantors named therein (including Torchlight U.S. Holdings, Inc., a corporation organized under the laws of the State of Delaware), and Northern Dominion Trust Company, as Trustee.
"Issuer" or "TMC" means Torchlight Mining Corp., a corporation incorporated under the CBCA.
"Mining Claims" means Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47, inclusive, as recorded in the Mining Lands Administration System maintained by the Ontario Ministry of Northern Development, Mines, Natural Resources and Forestry.
"Notes" means the 8.750% Senior Secured Notes due 2029 in the aggregate principal amount of $300,000,000 issued by the Issuer under the Indenture.
"OBCA" means the Business Corporations Act (Ontario), R.S.O. 1990, c. B.16, as amended, together with the regulations promulgated thereunder.
"Offering Memorandum" means the Final Offering Memorandum dated March 14, 2022, relating to the Offering.
"PPSA" means the Personal Property Security Act (Ontario), R.S.O. 1990, c. P.10, as amended, together with the regulations promulgated thereunder.
"Purchase Agreement" means the Purchase Agreement dated March 29, 2022, among the Issuer, the Guarantors named therein, and the Initial Purchasers.
"Registration Rights Agreement" means the Registration Rights Agreement dated as of April 19, 2022, among the Issuer, the Guarantors named therein, and the Initial Purchasers.
"TMPI" means Torchlight Milling & Processing Inc., a corporation incorporated under the OBCA.
"Transaction Documents" means, collectively, the Indenture, the Guarantees, the Canadian GSA, the Purchase Agreement, the Registration Rights Agreement, and the Collateral Agency Agreement, in each case to the extent a Canadian Guarantor is a party thereto.
"Trustee" means Northern Dominion Trust Company, acting in its capacity as Trustee under the Indenture.
"WLML" means Wolverine Lake Mining Ltd., a corporation incorporated under the OBCA.
3. Documents and Records Examined
In connection with the opinions expressed herein, we have examined originals or copies (certified or otherwise identified to our satisfaction) of the following documents and records:
(a) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Torchlight Mining Corp., as furnished to us by officers of TMC;
(b) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Wolverine Lake Mining Ltd., as furnished to us by officers of WLML;
(c) the articles of incorporation (including all amendments thereto), the by-laws, and the minute books of Torchlight Milling & Processing Inc., as furnished to us by officers of TMPI;
(d) a certificate of status issued by the Director appointed under the CBCA with respect to Torchlight Mining Corp. dated April 19, 2022 (the "TMC Status Certificate");
(e) a certificate of status issued by the Ontario Ministry of Government and Consumer Services with respect to Wolverine Lake Mining Ltd. dated April 18, 2022 (the "WLML Status Certificate");
(f) a certificate of status issued by the Ontario Ministry of Government and Consumer Services with respect to Torchlight Milling & Processing Inc. dated April 18, 2022 (the "TMPI Status Certificate");
(g) certified copies of the resolutions of the board of directors of Torchlight Mining Corp. adopted on March 25, 2022, authorizing the execution, delivery, and performance by TMC of the Transaction Documents, the issuance of the Notes, and the granting of the security interests contemplated by the Canadian GSA;
(h) certified copies of the resolutions of the board of directors of Wolverine Lake Mining Ltd. adopted on March 25, 2022, authorizing the execution, delivery, and performance by WLML of the Transaction Documents, including the Guarantee and the Canadian GSA;
(i) certified copies of the resolutions of the board of directors of Torchlight Milling & Processing Inc. adopted on March 25, 2022, authorizing the execution, delivery, and performance by TMPI of the Transaction Documents, including the Guarantee and the Canadian GSA;
(j) written confirmations from the corporate secretaries of each of TMC, WLML, and TMPI that no shareholder approval is required under the CBCA or the OBCA (as applicable) in connection with the transactions contemplated by the Transaction Documents;
(k) the Indenture (execution copy, dated April 19, 2022);
(l) the Guarantees (as contained in Article X of the Indenture);
(m) the Canadian General Security Agreement (execution copy, dated April 19, 2022);
(n) the Collateral Agency Agreement (execution copy, dated April 19, 2022);
(o) the Purchase Agreement (execution copy, dated March 29, 2022);
(p) the Registration Rights Agreement (execution copy, dated April 19, 2022);
(q) the Final Offering Memorandum dated March 14, 2022;
(r) an Officer's Certificate of Torchlight Mining Corp. dated April 19, 2022, executed by Lianne Prokopchuk, Chief Financial Officer, and Deepak Rathore, General Counsel & Corporate Secretary (the "Officer's Certificate");
(s) a Secretary's Certificate of Torchlight Mining Corp. dated April 19, 2022, executed by Deepak Rathore, Corporate Secretary, certifying, among other things, the incumbency of the officers of TMC who executed the Transaction Documents and the constating documents and by-laws of TMC;
(t) a Secretary's Certificate of Wolverine Lake Mining Ltd. dated April 19, 2022, certifying, among other things, the incumbency of the officers of WLML who executed the Transaction Documents and the constating documents and by-laws of WLML;
(u) a Secretary's Certificate of Torchlight Milling & Processing Inc. dated April 19, 2022, certifying, among other things, the incumbency of the officers of TMPI who executed the Transaction Documents and the constating documents and by-laws of TMPI;
(v) the results of searches conducted on April 18, 2022 in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services with respect to each of TMC, WLML, and TMPI (as debtor) (the "PPSA Search Results");
(w) records obtained from the Mining Lands Administration System maintained by the Ontario Ministry of Northern Development, Mines, Natural Resources and Forestry relating to Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47 (the "MLAS Records"); and
(x) such other documents, corporate records, certificates of public officials and of officers and representatives of the Canadian Guarantors, and such other instruments, agreements, and records as we have deemed necessary or advisable for the purposes of rendering the opinions expressed herein.
4. Assumptions
In rendering the opinions set forth in this opinion letter, we have assumed the following without independent verification:
(a) the genuineness of all signatures on all documents examined by us;
(b) the authenticity of all documents submitted to us as originals, and the conformity to original documents of all documents submitted to us as copies (whether certified, photostatic, electronic, or otherwise identified to our satisfaction);
(c) the accuracy, completeness, and truth of all certificates, representations, and statements of fact delivered by officers and directors of the Issuer and the Canadian Guarantors, including the Officer's Certificate and the Secretary's Certificates referred to in Section 3 of this opinion letter, and we have relied upon such certificates, representations, and statements without independent investigation;
(d) that each party to the Transaction Documents (other than the Canadian Guarantors) is duly organized or incorporated, validly existing, and in good standing under the laws of its jurisdiction of organization or incorporation, and has all requisite corporate or other organizational power and authority to own, lease, and operate its assets and to carry on its business as presently conducted;
(e) that each party to the Transaction Documents (other than the Canadian Guarantors) has the requisite corporate or other organizational power, authority, and legal capacity to execute, deliver, and perform its obligations under the Transaction Documents to which it is a party, and that such execution, delivery, and performance have been duly authorized by all necessary corporate or other organizational action on the part of such party;
(f) that the Transaction Documents have been duly authorized, executed, and delivered by each party thereto (other than the Canadian Guarantors, as to which we express opinions below);
(g) that each natural person who executed any of the Transaction Documents or any certificate, instrument, or other document reviewed by us in connection herewith had, at the time of such execution, the requisite legal capacity to do so;
(h) that the choice of the laws of the State of New York as the governing law of the Indenture, the Purchase Agreement, and the Registration Rights Agreement is valid, binding, and enforceable under applicable conflict of laws principles and the laws of the State of New York, it being understood that we are qualified to render opinions only on the laws of Canada (federal) and the Province of Ontario and we express no opinion on the laws of the State of New York or any other jurisdiction of the United States;
(i) that Northern Dominion Trust Company has the requisite power, authority, and capacity under applicable United States federal and state law to act as Trustee under the Indenture and as Collateral Agent under the Collateral Agency Agreement and the Canadian GSA, and that its execution, delivery, and performance of such documents have been duly authorized by all necessary corporate action;
(j) that the certificates of status and certificates of compliance obtained from the Director appointed under the CBCA and the Ontario Ministry of Government and Consumer Services, respectively, referred to in Section 3 of this opinion letter, are accurate as of their respective dates and remain accurate as of the date hereof;
(k) that the descriptions of the personal property described in the Canadian GSA are sufficient to identify and describe such personal property for the purposes of creating a valid security interest therein under the PPSA;
(l) that value has been given by the Collateral Agent (on behalf of the holders of the Notes) in connection with the security interests created under the Canadian GSA within the meaning of the PPSA; and
(m) that the copies of all constating documents and by-laws of the Canadian Guarantors provided to us are complete and accurate and have not been further amended, supplemented, or restated as of the date hereof.
5. Opinions
Based upon and subject to the foregoing and the qualifications and limitations set forth in Section 6 of this opinion letter, and having regard to such legal considerations as we deem relevant, we are of the opinion that:
5.1 Due Organization and Valid Existence — Torchlight Mining Corp.
Torchlight Mining Corp. is a corporation duly incorporated and validly existing under the CBCA. Based on the TMC Status Certificate issued by the Director appointed under the CBCA dated April 19, 2022, TMC is in good standing under the CBCA, meaning that TMC has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of TMC are pending under the CBCA as of such date.
5.2 Due Organization and Valid Existence — Wolverine Lake Mining Ltd.
Wolverine Lake Mining Ltd. is a corporation duly incorporated and validly existing under the OBCA. Based on the WLML Status Certificate issued by the Ontario Ministry of Government and Consumer Services dated April 18, 2022, WLML is in good standing under the laws of the Province of Ontario, meaning that WLML has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of WLML are pending under the OBCA as of such date. WLML has not been cancelled for default under the Corporations Tax Act (Ontario) or the Corporations Information Act (Ontario) and its status is active.
5.3 Due Organization and Valid Existence — Torchlight Milling & Processing Inc.
Torchlight Milling & Processing Inc. is a corporation duly incorporated and validly existing under the OBCA. Based on the TMPI Status Certificate issued by the Ontario Ministry of Government and Consumer Services dated April 18, 2022, TMPI is in good standing under the laws of the Province of Ontario, meaning that TMPI has not been dissolved and, to the knowledge disclosed by such certificate, no proceedings for the dissolution of TMPI are pending under the OBCA as of such date. TMPI has not been cancelled for default under the Corporations Tax Act (Ontario) or the Corporations Information Act (Ontario) and its status is active.
5.4 Corporate Power and Authority — Torchlight Mining Corp.
TMC has the corporate power and capacity under the CBCA and its articles of incorporation and by-laws to: (a) issue the Notes; (b) execute, deliver, and perform its obligations under the Indenture, the Purchase Agreement, the Registration Rights Agreement, the Canadian GSA, and the Collateral Agency Agreement; and (c) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.
5.5 Corporate Power and Authority — Wolverine Lake Mining Ltd.
WLML has the corporate power and capacity under the OBCA and its articles of incorporation and by-laws to: (a) execute, deliver, and perform its obligations under the Guarantee (as contained in Article X of the Indenture), the Canadian GSA, and the Collateral Agency Agreement; and (b) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.
5.6 Corporate Power and Authority — Torchlight Milling & Processing Inc.
TMPI has the corporate power and capacity under the OBCA and its articles of incorporation and by-laws to: (a) execute, deliver, and perform its obligations under the Guarantee (as contained in Article X of the Indenture), the Canadian GSA, and the Collateral Agency Agreement; and (b) grant the security interests in favour of the Collateral Agent as contemplated by the Canadian GSA and the Collateral Agency Agreement.
5.7 Due Authorization — All Canadian Guarantors
The execution, delivery, and performance of the Transaction Documents by each of TMC, WLML, and TMPI have been duly authorized by all necessary corporate action on the part of each such entity, including resolutions of the respective boards of directors of TMC, WLML, and TMPI adopted in accordance with the CBCA or the OBCA (as applicable) and the articles of incorporation and by-laws of each such entity. No approval of the shareholders of TMC is required under the CBCA, and no approval of the shareholders of WLML or TMPI is required under the OBCA, in connection with the execution, delivery, and performance by such entities of the Transaction Documents or the consummation of the transactions contemplated thereby.
5.8 Execution and Delivery
Each of the Transaction Documents to which TMC, WLML, or TMPI is a party has been duly executed and delivered by such entity through its duly authorized officers.
5.9 Enforceability of Guarantees
The Guarantee of each of WLML and TMPI, as contained in the Indenture, constitutes a legal, valid, and binding obligation of such entity, enforceable against such entity in accordance with its terms, subject to the qualifications and limitations set forth in Section 6 of this opinion letter.
5.10 Enforceability of the Canadian General Security Agreement
The Canadian GSA constitutes a legal, valid, and binding obligation of each of TMC, WLML, and TMPI, enforceable against each such entity in accordance with its terms, subject to the qualifications and limitations set forth in Section 6 of this opinion letter.
5.11 Creation of Security Interests under the Canadian GSA
The Canadian GSA creates, in favour of Northern Dominion Trust Company, as Collateral Agent for the benefit of the holders of the Notes, a valid security interest in the personal property of each of TMC, WLML, and TMPI described therein (the "Collateral"), to the extent that a security interest in such personal property can be created under the PPSA. Without limiting the generality of the foregoing, the Collateral described in the Canadian GSA includes, to the extent constituting personal property under the PPSA: (a) equipment; (b) inventory; (c) accounts receivable and other accounts; (d) chattel paper; (e) instruments; (f) documents of title; (g) intangibles, including contractual rights and intellectual property; (h) investment property, including equity interests held by each Canadian Guarantor in its subsidiaries; and (i) such rights and interests in respect of the Mining Claims (being Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47, relating to the Wolverine Lake property comprising approximately 12,400 hectares) and associated surface rights as constitute personal property under the PPSA, in each case whether now owned or hereafter acquired by such Canadian Guarantor.
5.12 Perfection of Security Interests (PPSA)
Upon the filing of financing statements under the PPSA in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services in the name of each of TMC, WLML, and TMPI (as debtor) in favour of Northern Dominion Trust Company, as Collateral Agent (as secured party), the security interests created under the Canadian GSA in those categories of personal property in which a security interest may be perfected by registration under the PPSA will be perfected under the PPSA. We note that the priority of such security interests will be subject to the priority rules set forth in the PPSA and to the rights of any prior registrants or other persons holding a prior interest in the Collateral, as disclosed by the PPSA Search Results or otherwise.
5.13 No Conflict — Canadian Law
The execution, delivery, and performance of the Transaction Documents by each of TMC, WLML, and TMPI do not and will not:
(a) contravene or conflict with the CBCA or the OBCA (as applicable), or the articles of incorporation or by-laws of any such entity;
(b) result in any breach of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, any provision of any agreement, instrument, or other obligation known to us to which any such entity is a party or by which it or any of its property is bound, to the extent such agreement, instrument, or obligation is governed by the laws of Canada (federal) or the Province of Ontario; or
(c) result in a violation of any applicable Canadian federal or Ontario provincial law, statute, regulation, rule, order, or decree known to us to be applicable to any such entity or any of its respective properties or assets.
5.14 Governmental Approvals — Canadian Law
No consent, approval, licence, authorization, or order of, or registration, qualification, designation, declaration, or filing with, any Canadian federal or Ontario provincial governmental authority, agency, or regulatory body is required for the execution, delivery, or performance of the Transaction Documents by any of TMC, WLML, or TMPI, or for the consummation of the transactions contemplated thereby, other than:
(a) the filing of financing statements under the PPSA in the Personal Property Security Registration System maintained by the Ontario Ministry of Government and Consumer Services in respect of the security interests created under the Canadian GSA, which filings have been made or will be made promptly following the closing of the Offering;
(b) notification filings with the Toronto Stock Exchange (the "TSX") as may be required in connection with the incurrence of indebtedness by TMC, which filings are not a condition precedent to the validity or enforceability of the transactions contemplated by the Transaction Documents; and
(c) such filings or notifications as may be required under applicable Canadian securities legislation, including any reporting obligations under National Instrument 51-102 — Continuous Disclosure Obligations or National Instrument 51-101 — Standards of Disclosure for Oil and Gas Activities (to the extent applicable by analogy to mining issuers) or any applicable material change reporting requirements.
5.15 No Proceedings
Based solely upon the Officer's Certificate delivered by Lianne Prokopchuk, Chief Financial Officer, and Deepak Rathore, General Counsel & Corporate Secretary of Torchlight Mining Corp. dated April 19, 2022, and corresponding certificates delivered by authorized officers of WLML and TMPI, and without any independent inquiry or investigation on our part, there are no actions, suits, proceedings, investigations, or claims pending or, to the knowledge of such officers, threatened against TMC, WLML, or TMPI before any Canadian court, tribunal, arbitral body, or governmental authority that would reasonably be expected to materially and adversely affect the validity or enforceability of the Transaction Documents or the ability of any Canadian Guarantor to perform its obligations thereunder.
6. Qualifications and Limitations
The opinions expressed in this opinion letter are subject to the following qualifications and limitations:
6.1 Standard Enforceability Qualifications
The opinions expressed herein as to the enforceability of the Guarantees, the Canadian GSA, and the other Transaction Documents are subject to and may be limited by:
(a) applicable bankruptcy, insolvency, reorganization, moratorium, arrangement, winding-up, liquidation, and other similar laws of general application affecting the enforcement of creditors' rights generally, including, without limitation, the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada), the Winding-up and Restructuring Act (Canada), and the Assignments and Preferences Act (Ontario);
(b) general equitable principles and the equitable discretion of courts of competent jurisdiction, whether such enforcement is sought in a proceeding in equity or at law, including the availability of equitable remedies such as specific performance, injunctive relief, rescission, and declaratory relief, and the doctrines of unconscionability, good faith, fair dealing, and reasonableness;
(c) the Currency Act (Canada), which provides that, unless otherwise expressly stated, all public accounts, obligations, and proceedings in Canada are to be in Canadian currency, and which may require that judgments rendered by Canadian courts be expressed and paid in Canadian currency, notwithstanding any contractual provisions to the contrary requiring payment in United States dollars or any other foreign currency;
(d) the Limitations Act, 2002 (Ontario) and other applicable limitation periods, which may bar the enforcement of rights and remedies under the Transaction Documents after the expiry of the applicable limitation period; and
(e) the general principle that the courts may decline to enforce provisions of the Transaction Documents that are found to be contrary to public policy.
6.2 Security Interest Qualifications
The opinions expressed herein as to the creation, validity, and perfection of the security interests created under the Canadian GSA are subject to and may be limited by the following:
(a) The PPSA does not apply to certain types of property or interests, including liens on interests in real property. To the extent that the Mining Claims (Ontario Mining Claim Nos. WL-4492-01 through WL-4492-47) or the surface rights at the Wolverine Lake property constitute interests in land or interests in mining lands under applicable Ontario law, such interests may not be subject to a security interest created or perfected under the PPSA. Interests in real property, including interests in mining lands, must be separately registered under the Land Titles Act (Ontario) or the Registry Act (Ontario), as applicable, and mining rights and claims must be registered in the Mining Lands Administration System maintained under the Mining Act (Ontario). We express no opinion on the creation or perfection of any security interest or encumbrance in or upon mining claims, mining licences, mining leases, or other interests in mining lands to the extent that registration in the Mining Lands Administration System under the Mining Act (Ontario) has not been completed.
(b) The priority of the security interests created under the Canadian GSA is subject to the priority rules set forth in the PPSA, including, without limitation, the rules relating to purchase-money security interests, and to any prior registrations, prior perfected security interests, or other prior interests in the Collateral. Priority is also subject to any statutory lien, deemed trust, or other priority claim arising under applicable Canadian federal or Ontario provincial legislation, including, without limitation: (i) deemed trusts for unremitted source deductions under subsection 227(4.1) of the Income Tax Act (Canada); (ii) deemed trusts for unremitted goods and services tax or harmonized sales tax under subsection 222(3) of the Excise Tax Act (Canada); (iii) deemed trusts for workers' compensation premiums under the Workplace Safety and Insurance Act, 1997 (Ontario); (iv) deemed trusts or statutory liens for unpaid municipal property taxes; and (v) any other deemed trust or statutory priority that by its terms ranks in priority to a security interest perfected under the PPSA.
(c) After-acquired property provisions contained in the Canadian GSA are subject to the limitations set forth in the PPSA, including, among other things, the subordination of a security interest in after-acquired collateral to a purchase-money security interest that is perfected within the time periods prescribed by the PPSA.
(d) To the extent that the Collateral described in the Canadian GSA includes intellectual property rights that are registrable under applicable federal intellectual property statutes, including the Patent Act (Canada), the Trade-marks Act (Canada), and the Copyright Act (Canada), registration of the security interest or assignment under such federal statutes may be required for full enforceability against third parties. We express no opinion on the effect of any failure to make such registrations.
(e) We express no opinion as to the creation, validity, or perfection of a security interest in any property or assets of the Canadian Guarantors located outside the Province of Ontario. To the extent that any personal property of a Canadian Guarantor is located in a province or territory of Canada other than Ontario, perfection of a security interest in such property may require registration under the personal property security legislation of such other province or territory.
6.3 Limitation to Canadian Federal Law and Ontario Law
This opinion letter is limited solely to the federal laws of Canada and the laws of the Province of Ontario as in effect on the date hereof, and we express no opinion with respect to the laws of any other jurisdiction, including, without limitation, the laws of the State of New York, the State of Delaware, or any other state of the United States, or the federal laws of the United States. We express no opinion on the validity, binding effect, or enforceability of any provision of the Transaction Documents to the extent that such provision is governed by the laws of the State of New York or any other jurisdiction outside Canada. We express no opinion on the application or effect of the laws of any foreign jurisdiction on any of the matters addressed herein.
6.4 Other Qualifications
(a) This opinion does not address, and we express no opinion on, the tax consequences of the transactions contemplated by the Transaction Documents, including, without limitation, any consequences arising under the Income Tax Act (Canada), the Excise Tax Act (Canada), or any provincial tax legislation.
(b) This opinion does not address, and we express no opinion on, compliance with the securities laws of any jurisdiction other than Canada and the Province of Ontario, and we note that we have not been asked to, and do not, opine on compliance with the registration and prospectus requirements of Canadian securities legislation in connection with the Offering.
(c) This opinion does not address, and we express no opinion on, the financial condition or solvency of any of the Canadian Guarantors or the adequacy of consideration received by any Canadian Guarantor in connection with its execution and delivery of the Guarantees or the Canadian GSA. We note that the enforceability of the Guarantees and the Canadian GSA may be subject to challenge on the basis that the relevant Canadian Guarantor was insolvent or rendered insolvent at the time of the granting of such Guarantee or security interest, or that such Guarantee or security interest was granted for inadequate consideration, under applicable provincial fraudulent conveyance legislation (including the Fraudulent Conveyors Act (Ontario)), the Assignments and Preferences Act (Ontario), Section 96 of the Bankruptcy and Insolvency Act (Canada), or Section 36.1 of the Companies' Creditors Arrangement Act (Canada), and we express no opinion on the applicability or effect of any such legislation to or upon the Guarantees or the Canadian GSA.
(d) Provisions of the Transaction Documents that purport to constitute waivers of rights may not be enforceable to the extent that such provisions purport to waive rights that cannot be waived as a matter of applicable law or public policy, including, without limitation, rights that are conferred by statute and expressed to be non-waivable.
(e) Severability clauses contained in the Transaction Documents, while generally upheld by Canadian courts, are subject to the discretion of the court before which such clauses are sought to be enforced, and a court may decline to enforce any provision of the Transaction Documents that it determines to be illegal, void, or unenforceable, notwithstanding any severability provision.
(f) Indemnification and contribution provisions contained in the Transaction Documents may be limited or found unenforceable under applicable law, including, without limitation, the principle that a person may not be indemnified against the consequences of its own fraud, negligence, wilful misconduct, or breach of fiduciary duty, and the general principle that indemnification provisions that are contrary to public policy or that purport to indemnify a party against criminal liability or regulatory sanctions may not be enforceable.
(g) We express no opinion with respect to any provision of the Transaction Documents that purports to restrict access to courts or to waive the right to trial by jury, to the extent such provisions may be unenforceable under applicable Canadian law.
7. Reliance and Other Matters
This opinion letter is rendered solely for the benefit of the Initial Purchasers, being Kelvantis Capital Markets LLC, Prestige Barrington & Co., Inc., and Halcyon Securities Inc., in connection with the transactions contemplated by the Purchase Agreement and the other Transaction Documents. This opinion letter may also be relied upon by:
(a) Calderwood & Harkness LLP, as U.S. counsel to the Issuer, solely in connection with the opinions being delivered by such firm on the date hereof in relation to the Offering and the Transaction Documents;
(b) Clairmont & Voss LLP, as U.S. counsel to the Initial Purchasers, solely in connection with the opinions being delivered by such firm on the date hereof in relation to the Offering and the Transaction Documents; and
(c) Northern Dominion Trust Company, in its capacity as Trustee under the Indenture and as Collateral Agent under the Collateral Agency Agreement and the Canadian GSA, solely in connection with the transactions contemplated by the Transaction Documents.
This opinion letter may not be relied upon by any other person or entity, or for any purpose other than as described herein, without our prior written consent, and no person or entity other than those expressly named above as addressees or permitted reliance parties is entitled to rely on this opinion letter.
This opinion letter speaks only as of the date hereof, and we undertake no obligation, and hereby disclaim any obligation, to update or supplement this opinion letter for any changes in fact or law that may occur or become known to us after the date hereof, regardless of whether such changes may affect the opinions expressed herein.
We hereby consent to the filing of this opinion letter as an exhibit to the Offering Memorandum or as may otherwise be required in connection with the Offering, and to reference to this firm under the heading "Legal Matters" in the Offering Memorandum. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under applicable securities legislation.
This opinion letter is governed by, and shall be construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein.
8. Closing
We trust that the foregoing is satisfactory for your purposes. Please do not hesitate to contact the undersigned should you require any further information or clarification.
Very truly yours,
PENDLETON ROSS LLP
By: ________
Name: Marie-Claire Bouchard
Title: Partner
Securities & Corporate Finance
cc:
Torchlight Mining Corp.
Attention: Deepak Rathore, General Counsel & Corporate Secretary
2200 – 400 Burrard Street Vancouver, BC V6C 3A6
Calderwood & Harkness LLP
Attention: Vivienne St. Claire
450 Park Avenue New York, NY 10022
Clairmont & Voss LLP
Attention: Harrison Voss
51 West 52nd Street New York, NY 10019
Northern Dominion Trust Company
Attention: Sandra Leung, VP, Corporate Trust
101 Barclay Street, 7th Floor New York, NY 10286
Form reviewed and approved by Calderwood & Harkness LLP — Matter No. 1039-00002 — Reviewed by Audrey Zhou; approved by Vivienne St. Claire

PENDLETON ROSS LLP Barristers & Solicitors 3400 – 1 First Canadian Place Toronto, Ontario M5X 1A4 Canada

FORM REVIEWED AND APPROVED BY CALDERWOOD & HARKNESS LLP

PENDLETON ROSS LLP

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