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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549
FORM 20-F

[  ]  REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)
or 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

[ X ]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended July 31, 2015

OR

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

[  ]  SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 0-15490

QUARTZ MOUNTAIN RESOURCES LTD.

(Exact name of Registrant as specified in its charter)

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BRITISH COLUMBIA, CANADA

(Jurisdiction of
  incorporation or organization)

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15th Floor, 1040 West Georgia
Street Vancouver, British Columbia, Canada, V6E 4H1

(Address
  of principal executive offices)

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Trevor Thomas, Corporate Secretary Facsimile No.:
604-681-2741 15th Floor, 1040 West Georgia Street Vancouver, British
Columbia, Canada, V6E 4H1(Name, Telephone, E-mail and/or Facsimile
number and Address of Company Contact Person)

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Securities registered or to be registered pursuant to Section
12(b) of the Act.

|Title of Each Class: | Name of each exchange on which registered
|-------------------- | -----------------------------------------
|Not applicable       | Not applicable                           

Securities registered or to be registered pursuant to Section
12(g) of the Act

Common shares, no par value

Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act.

None

Indicate the number of outstanding shares of each of the
issuer's classes of capital or common stock as of the close of the period
covered by the annual report:

27,299,513 common shares as of July 31, 2015

Indicate by check mark if the Registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.

| | Yes  [  ] | No  [ X ] | 
| | --------- | --------- | 

1

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If this report is an annual or transition report, indicate by
check mark if the Registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934.

| | Yes  [  ] | No  [ X ] | 
| | --------- | --------- | 

Indicate by check mark whether Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that Registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.

| | Yes  [ X ] | No  [  ] | 
| | ---------- | -------- | 

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405
of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and
post such files).

| | Yes  [  ] | No  [  ] | 
| | --------- | -------- | 

Indicate by check mark whether the Registrant is a large
accelerated filer, an accelerated filer or non-accelerated filer. See
definition of "accelerated filer" and "large accelerated filer" in Rule 126-2 of
the Exchange Act.

Large Accelerated Filer  [  ]
    Accelerated Filer  [  ]
    Non-Accelerated Filer  [ X ]


Indicate by check mark which basis of accounting the registrant
has used to prepare the financial statements included in this filing:

U.S. GAAP  [  ]
    International Financial Reporting Standards
      as issued  [ X ]
      by the International Accounting Standards
      Board
    Other  [  ]


If "Other" has been checked in response to the previous
question, indicate by check mark which financial statement item the
registrant has elected to follow.

| | Item 17 [  ] | Item 18 [  ] | 
| | ------------ | ------------ | 

If this is an annual report, indicate by check mark whether the
Registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act):

| | Yes [  ] | No  [ X ] | 
| | -------- | --------- | 

2

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|GENERAL                                  |                                                             | 5 
|---------------------------------------- | ----------------------------------------------------------- | --
|                                         |                                                             |   
|CURRENCY AND MEASUREMENT                 | 8                                                          
|                                         |                                                            
|NOTE ON FORWARD LOOKING
      STATEMENTS | 8                                                          
|                                         |                                                            
|ITEM 1                                   | IDENTITY OF DIRECTORS, SENIOR
    MANAGEMENT AND ADVISERS   | 8 
|                                         |                                                             |   
|ITEM 2                                   | OFFER STATISTICS AND EXPECTED
    TIMETABLE                 | 9 
|                                         |                                                             |   
|ITEM 3                                   | KEY INFORMATION                                             | 9 
|                                         |                                                             |   
|A.                                       | SELECTED FINANCIAL DATA                                     | 9 
|                                         |                                                             |   
|B.                                       | CAPITALIZATION AND INDEBTEDNESS                             | 10
|                                         |                                                             |   
|C.                                       | REASONS FOR THE OFFER AND USE
    OF PROCEEDS               | 10
|                                         |                                                             |   
|D.                                       | RISK FACTORS                                                | 10
|                                         |                                                             |   
|ITEM 4                                   | INFORMATION ON THE COMPANY                                  | 15
|                                         |                                                             |   
|A.                                       | HISTORY AND DEVELOPMENT OF THE
    COMPANY                  | 15
|                                         |                                                             |   
|B.                                       | BUSINESS OVERVIEW                                           | 16
|                                         |                                                             |   
|C.                                       | MINERAL PROPERTIES AND
    EXPLORATION ACTIVITIES AND PLANS | 18
|                                         |                                                             |   
|D.                                       | ORGANIZATIONAL STRUCTURE                                    | 23
|                                         |                                                             |   
|E.                                       | PROPERTY, PLANT AND EQUIPMENT                               | 23
|                                         |                                                             |   
|F.                                       | CURRENCY                                                    | 23
|                                         |                                                             |   
|ITEM 4A                                  | UNRESOLVED STAFF COMMENTS                                   | 24
|                                         |                                                             |   
|ITEM 5                                   | OPERATING AND FINANCIAL REVIEW
    AND PROSPECTS            | 24
|                                         |                                                             |   
|OVERVIEW                                 | 24                                                         
|                                         |                                                            
|A.                                       | OPERATING RESULTS                                           | 24
|                                         |                                                             |   
|B.                                       | LIQUIDITY AND CAPITAL RESOURCES                             | 27
|                                         |                                                             |   
|C.                                       | RESEARCH EXPENDITURES                                       | 29
|                                         |                                                             |   
|D.                                       | TREND INFORMATION                                           | 29
|                                         |                                                             |   
|E.                                       | OFF  BALANCE SHEET
    ARRANGEMENTS                        | 29
|                                         |                                                             |   
|F.                                       | TABULAR DISCLOSURE OF
    CONTRACTUAL OBLIGATIONS           | 30
|                                         |                                                             |   
|G.                                       | SAFE HARBOR                                                 | 30
|                                         |                                                             |   
|ITEM 6                                   | DIRECTORS, SENIOR MANAGEMENT
    AND EMPLOYEES              | 30
|                                         |                                                             |   
|A.                                       | DIRECTORS AND SENIOR MANAGEMENT                             | 30
|                                         |                                                             |   
|B.                                       | COMPENSATION                                                | 35
|                                         |                                                             |   
|C.                                       | BOARD PRACTICES                                             | 36
|                                         |                                                             |   
|D.                                       | EMPLOYEES                                                   | 40
|                                         |                                                             |   
|E.                                       | SHARE OWNERSHIP                                             | 41
|                                         |                                                             |   
|ITEM 7                                   | MAJOR SHAREHOLDERS AND RELATED
    PARTY TRANSACTIONS       | 42
|                                         |                                                             |   
|A.                                       | MAJOR SHAREHOLDERS                                          | 42
|                                         |                                                             |   
|B.                                       | RELATED PARTY TRANSACTIONS                                  | 43
|                                         |                                                             |   
|C.                                       | INTERESTS OF EXPERTS AND
    COUNSEL                        | 44
|                                         |                                                             |   
|ITEM 8                                   | FINANCIAL INFORMATION                                       | 44
|                                         |                                                             |   
|A.                                       | CONSOLIDATED STATEMENTS AND
    OTHER FINANCIAL INFORMATION | 44
|                                         |                                                             |   
|B.                                       | SIGNIFICANT CHANGES                                         | 44
|                                         |                                                             |   
|ITEM 9                                   | THE OFFER AND LISTING                                       | 45
|                                         |                                                             |   
|A.                                       | OFFER AND LISTING DETAILS                                   | 45
|                                         |                                                             |   
|B.                                       | PLAN OF DISTRIBUTION                                        | 46
|                                         |                                                             |   
|C.                                       | MARKETS                                                     | 46

3

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|D.       | SELLING SHAREHOLDERS                                                               | 46
|-------- | ---------------------------------------------------------------------------------- | --
|         |                                                                                    |   
|E.       | DILUTION                                                                           | 46
|         |                                                                                    |   
|F.       | EXPENSES OF THE ISSUE                                                              | 46
|         |                                                                                    |   
|ITEM 10  | ADDITIONAL INFORMATION                                                             | 46
|         |                                                                                    |   
|A.       | SHARE CAPITAL                                                                      | 46
|         |                                                                                    |   
|B.       | MEMORANDUM AND ARTICLES OF
      ASSOCIATION                                       | 46
|         |                                                                                    |   
|C.       | MATERIAL CONTRACTS                                                                 | 49
|         |                                                                                    |   
|D.       | EXCHANGE CONTROLS                                                                  | 49
|         |                                                                                    |   
|E.       | TAXATION                                                                           | 49
|         |                                                                                    |   
|F.       | DIVIDENDS AND PAYING AGENTS                                                        | 57
|         |                                                                                    |   
|G.       | STATEMENT BY EXPERTS                                                               | 57
|         |                                                                                    |   
|H.       | DOCUMENTS ON DISPLAY                                                               | 57
|         |                                                                                    |   
|I.       | SUBSIDIARY INFORMATION                                                             | 57
|         |                                                                                    |   
|ITEM 11  | QUANTITATIVE AND QUALITATIVE
      DISCLOSURES ABOUT MARKET RISK                   | 58
|         |                                                                                    |   
|A.       | TRANSACTION RISK AND CURRENCY
      RISK MANAGEMENT                                | 58
|         |                                                                                    |   
|B.       | EXCHANGE RATE SENSITIVITY                                                          | 58
|         |                                                                                    |   
|C.       | INTEREST RATE RISK AND EQUITY
      PRICE RISK                                     | 58
|         |                                                                                    |   
|D.       | COMMODITY PRICE RISK                                                               | 58
|         |                                                                                    |   
|ITEM 12  | DESCRIPTION OF SECURITIES OTHER
      THAN EQUITY SECURITIES                       | 58
|         |                                                                                    |   
|ITEM 13  | DEFAULTS, DIVIDEND ARREARAGES
      AND DELINQUENCIES                              | 58
|         |                                                                                    |   
|ITEM 14  | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
      AND USE OF PROCEEDS | 58
|         |                                                                                    |   
|ITEM 15  | CONTROLS AND PROCEDURES                                                            | 58
|         |                                                                                    |   
|A.       | DISCLOSURE CONTROLS AND
      PROCEDURES                                           | 58
|         |                                                                                    |   
|B.       | MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER
      FINANCIAL  REPORTING     | 59
|         |                                                                                    |   
|         | CHANGES IN INTERNAL CONTROL
      OVER FINANCIAL REPORTING                         | 59
|         |                                                                                    |   
|         | LIMITATIONS OF CONTROLS AND
      PROCEDURES                                       | 59
|         |                                                                                    |   
|ITEM 16  | [RESERVED]                                                                         | 60
|         |                                                                                    |   
|ITEM 16A | AUDIT COMMITTEE FINANCIAL
      EXPERT                                             | 60
|         |                                                                                    |   
|ITEM 16B | CODE OF ETHICS                                                                     | 60
|         |                                                                                    |   
|ITEM 16C | PRINCIPAL ACCOUNTANT FEES AND
      SERVICES                                       | 61
|         |                                                                                    |   
|ITEM 16D | EXEMPTIONS FROM LISTING
      STANDARDS FOR AUDIT COMMITTEES                       | 61
|         |                                                                                    |   
|ITEM 16E | PURCHASES OF EQUITY SECURITIES
      BY THE ISSUER AND AFFILIATED PURCHASERS       | 61
|         |                                                                                    |   
|ITEM 16F | CHANGE IN REGISTRANT'S
      CERTIFYING ACCOUNTANT                                 | 61
|         |                                                                                    |   
|ITEM 16G | CORPORATE GOVERNANCE                                                               | 62
|         |                                                                                    |   
|ITEM 16H | MINE SAFETY DISCLOSURE                                                             | 62
|         |                                                                                    |   
|ITEM 17  | FINANCIAL STATEMENTS                                                               | 62
|         |                                                                                    |   
|ITEM 18  | FINANCIAL STATEMENTS                                                               | 62
|         |                                                                                    |   
|ITEM 19  | EXHIBITS                                                                           | 62

4

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GENERAL

In this Annual Report on Form 20-F, all references to "we", the
"Company" or "Quartz Mountain" refer to Quartz Mountain Resources Ltd. and its
consolidated subsidiary.

The Company uses the Canadian dollar as its reporting currency.
All references in this document to "dollars" or "$" are expressed in Canadian
dollars, unless otherwise indicated. See also Item 3  "KeyInformation"for more detailed currency and conversion
information.

Except as noted, the information set forth in this Annual
Report is as of November 25, 2015, and all information included in this document
should only be considered correct as of such date.

Certain terms used herein are defined as follows:

|ICP                              | Inductively coupled plasma (ICP) mass spectrometry is a
      type of mass spectrometry which is capable of detecting metals and several
      non-metals at concentrations as low as one part per trillion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|ICP-AES                          | Inductively coupled plasma atomic emission spectroscopy
      is an analytical technique used for the detection of trace metals. It is a
      type of emission spectroscopy that uses the inductively coupled plasma to
      produce excited atoms and ions that emit electromagnetic radiation at
      wavelengths characteristic of a particular element. The intensity of this
      emission is indicative of the concentration of the element within the
      sample.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Induced Polarization (IP) Survey | A geophysical survey used to identify a feature that
      appears to be different from the typical or background survey results when
      tested for levels of electro-conductivity; IP detects both chargeable,
      pyrite-bearing rock and non-conductive rock that has a high content of
      quartz.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Epithermal Deposit               | Gold, gold-silver or silver deposits, some also include
      important base metals; occurring as narrow vein to large low grade
      disseminated deposits.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Mineral Reserve                  | Securities and Exchange Commission Industry Guide 7
      "Description of Property by Issuers Engaged or to be Engaged in
      Significant Mining Operations" (under the United States Securities
      Exchange Act of 1934, as amended) defines a 'reserve' as that part of a
      mineral deposit which could be economically and legally extracted or
      produced at the time of the reserve determination. Reserves consist of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                 | (1) Proven (Measured) Reserves. Reserves for which: (a)
      quantity is computed from dimensions revealed in outcrops, trenches,
      workings or drill holes; grade and/or quality are computed from the
      results of detailed sampling; and (b) the sites for inspection, sampling
      and measurement are spaced so closely and the geologic character is so
      well defined that size, shape, depth and mineral content of reserves are
      well-established.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                 | (2) Probable (Indicated) Reserves. Reserves for which
      quantity and grade and/or quality are computed from information similar to
      that used for proven (measured) reserves, but the sites for inspection,
      sampling and measurement are farther apart or are otherwise less
      adequately spaced. The degree of assurance, although lower than that for
      proven (measured) reserves, is high enough to assume continuity between
      points of observation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                 | As a reporting issuer under the Securities Acts of
      British Columbia and Alberta, the Company is subject to National
      Instrument 43-101 "Standards of Disclosure for Mineral Projects" of the
      Canadian Securities Administrators. Securities and Exchange Commission
      Industry Guide 7, as interpreted by Securities and Exchange Commission
      Staff, applies standards that are different from those prescribed by
      National Instrument 43-101 in order to classify mineralization as a
      reserve. In particular, Mineral Reserves under National Instrument 43-101
      are defined as the economically mineable part of a Measured and/or
      Indicated Mineral Resource. It includes diluting materials and allowances
      for losses, which may occur when the material is mined or extracted and is
      defined by studies at Pre-Feasibility or Feasibility level as appropriate
      that include application of Modifying Factors, which are considerations
      used to convert Mineral Resources to Mineral Reserves and include, but are
      not restricted to, mining, processing, metallurgical, infrastructure,
      economic, marketing, legal, environmental, social and governmental
      factors. Such studies demonstrate that, at the time of reporting,
      extraction could reasonably be justified. The reference point at which
      Mineral Reserves are defined, usually the point where the ore is delivered
      to the processing plant, must be stated. It is important that, in all
      situations where the reference point is different, such as for a saleable
      product, a clarifying statement is included to ensure that the reader is
      fully informed as to what is being reported. The public disclosure of a
      Mineral Reserve must be demonstrated by a Pre- Feasibility Study or
      Feasibility Study.

5

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|                 | Under the standards of the Securities and Exchange
      Commission, mineralization may not be classified as a "reserve" unless the
      determination has been made that the mineralization could be economically
      and legally produced or extracted at the time the reserve determination is
      made. Among other things, all necessary permits would be required to be in
      hand or issued imminently in order to classify mineralized material as
      reserves under Securities and Exchange Commission Industry Guide 7.
      Accordingly, mineral reserve estimates established in accordance with
      National Instrument 43-101 may not qualify as "reserves" under SEC
      standards. The Company does not currently have any mineral deposits that
      have been classified as reserves.                                                                                                                                                                                                                                    
|---------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Mineral Resource | National Instrument 43-101 Standards of Disclosure
      for Mineral Projects issued by the Canadian Securities Administrators
      defines a mineral Resources as a concentration or occurrence of solid
      material of economic interest in or on the Earths crust in such form,
      grade or quality and quantity that there are reasonable prospects for
      eventual economic extraction. The location, quantity, grade or quality,
      continuity and other geological characteristics of a Mineral Resource are
      known, estimated or interpreted from specific geological evidence and
      knowledge, including sampling. Mineral Resources are sub-divided, in order
      of increasing geological confidence, into Inferred, Indicated and Measured
      categories. An Inferred Mineral Resource has a lower level of confidence
      that that applied to an Indicated Mineral Resource, and an Indicated
      Mineral resources has a lower level of confidence than that applied to a
      Measured Mineral Resource.
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                 | (1) An Inferred Mineral Resource is that part of a
      Mineral Resource for which quantity and grade or quality are estimated on
      the basis of limited geological evidence and sampling. Geological evidence
      is sufficient to imply but not verify geological and grade or quality
      continuity. It has a lower level of confidence than that applying to an
      Indicated Mineral Resource and must not be converted to a Mineral Reserve.
      It is reasonably expected that the majority of Inferred Mineral Resources
      could be upgraded to Indicated Mineral Resources with continued
      exploration.                                                                                                                                                                                                                                                                                                                                                                                                                     
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                 | (2) An Indicated Mineral Resource is that part of a
      Mineral Resource for which quantity, grade or quality, densities, shape
      and physical characteristics are estimated with sufficient confidence to
      allow the application of Modifying Factors in sufficient detail to support
      mine planning and evaluation of the economic viability of the deposit.
      Geological evidence is derived from adequately detailed and reliable
      exploration, sampling and testing and is sufficient to assume geological
      and grade or quality continuity between points of observation. It has a
      lower level of confidence than that applying to a Measured Mineral
      Resource and may only be converted to a Probable Mineral Reserve.                                                                                                                                                                                                                                                                                     
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                 | (3) A Measured Mineral Resource is that part of a
      Mineral Resource for which quantity, grade or quality, densities, shape,
      and physical characteristics are estimated with confidence sufficient to
      allow the application of Modifying Factors to support detailed mine
      planning and final evaluation of the economic viability of the deposit.
      Geological evidence is derived from detailed and reliable exploration,
      sampling and testing and is sufficient to confirm geological and grade or
      quality continuity between points of observation. It has a higher level of
      confidence than that applying to either an Indicated Mineral Resource or
      an Inferred Mineral Resource. It may be converted to a Proven
      Mineral Reserve or to a Probable Mineral Reserve.                                                                                                                                                                                                                            
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

6

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|                         | Industry Guide 7  "Description of Property by Issuers
      Engaged or to be Engaged in Significant Mining Operations" of the
      Securities and Exchange Commission does not define or recognize resources.
      In addition, disclosure of resources using "contained ounces" is permitted
      under Canadian regulations; however, the Securities and Exchange
      Commission only permits issuers to report mineralization that does not
      qualify as a reserve as in place tonnage and grade without reference to
      unit measures. As used in this Form 20-F, "resources" are as defined in
      National Instrument 43-101.
|------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                         | For the above reasons, information in the Company's
      publicly-available documents containing descriptions of the Company's
      mineral deposits may not be comparable to similar information made public
      by U.S. companies subject to the reporting and disclosure requirements
      under the United States federal securities laws and the rules and
      regulations thereunder.                                                                                                                                                                                                                                                
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Mineral Symbols          | As  arsenic; Au  gold; Ag  silver; Cu  copper; Fe 
      iron; Hg  mercury; Mo  molybdenum; Na  sodium; Ni  nickel; O  oxygen;
      Pd - palladium; Pt  platinum; Pb  lead; S  sulphur; Sb  antimony; Zn 
      zinc.                                                                                                                                                                                                                                                                                                                                                                                                             
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Net Smelter Return (NSR) | Monies received for concentrate delivered to a smelter
      net of metallurgical recovery losses, transportation costs, smelter
      treatment-refining charges and penalty charges.                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Porphyry Deposit         | Mineral deposit characterized by widespread disseminated
      or veinlet- hosted sulphide mineralization, characterized by large tonnage
      and moderate to low grade.                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Skarn Deposit            | Sulphide-bearing deposits formed at the contact zone
      between granitic intrusions and carbonate sedimentary rocks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Sulphide                 | A compound of sulphur with another element, typically a
      metallic element or compound.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Vein                     | A tabular or sheet-like mineral deposit with identifiable
      walls, often filling a fracture or fissure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

7

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CURRENCY AND MEASUREMENT

All currency amounts in this Annual Report are stated in
Canadian dollars unless otherwise indicated. Conversion of metric units into
imperial equivalents is as follows:

Metric Units
    Multiply by
    Imperial Unitshectares
    2.471
    = acresmeters
    3.281
    = feetkilometers
    0.621
    = miles (5,280 feet)grams
    0.032
    = troy ouncestonnes
    1.102
    = short tons (2,000 lbs)grams per tonne
    0.029
    = troy ounces per ton


NOTE ON FORWARD LOOKING STATEMENTS

This Annual Report on Form 20-F contains statements that
constitute "forward-looking statements". Any statements that are not statements
of historical facts may be deemed to be forward-looking statements. These
statements appear in a number of different places in this Annual Report and, in
some cases, can be identified by words such as "anticipates", "estimates",
"projects", "expects", "intends", "believes", "plans", or their negatives or
other comparable words. The forward-looking statements, including the statements
contained in Item 3D "Risk Factors", Item 4B "Business
Overview",Item 5 "Operating and Financial Review and
Prospects" and Item 11 "Quantitative and Qualitative Disclosures About
Market Risk", involve known and unknown risks, uncertainties and other
factors which may cause the Company's actual results, performance or
achievements to be materially different from any future results, performance or
achievements that may be expressed or implied by such statements.
Forward-looking statements include statements regarding the outlook for the
Company's future operations, plans and timing for the Company's exploration
programs, statements about future market conditions, supply and demand
conditions, forecasts of future costs and expenditures, the outcome of legal
proceedings, and other expectations, intentions and plans that are not
historical facts.

You are cautioned that forward-looking statements are not
guarantees. The risks and uncertainties that could cause the Company's actual
results to differ materially from those expressed or implied by the
forward-looking statements include:

| | changes in general economic and business conditions,
      including commodity prices, costs associated with mineral exploration and
      development, changes in interest rates and the availability of financing
      on reasonable terms;
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                               
| | natural phenomena, including geological and
      meteorological phenomena;                                                                                                                                                                   
|  |                                                                                                                                                                                                                                               
| | actions by government authorities, including changes in
      government regulation and permitting requirements;                                                                                                                              
|  |                                                                                                                                                                                                                                               
| | uncertainties associated with legal proceedings;                                                                                                                                                                                              
|  |                                                                                                                                                                                                                                               
| | future decisions by management in response to changing
      conditions;                                                                                                                                                                      
|  |                                                                                                                                                                                                                                               
| | the Company's ability to execute prospective business
      plans; and                                                                                                                                                                        
|  |                                                                                                                                                                                                                                               
| | misjudgments in the course of preparing forward-looking
      statements.                                                                                                                                                                     

The Company advises you that these cautionary remarks expressly
qualify, in their entirety, all forward-looking statements attributable to
Quartz Mountain or persons acting on the Company's behalf. The Company assumes
no obligation to update the Company's forward-looking statements to reflect
actual results, changes in assumptions or changes in other factors affecting
such statements. You should carefully review the cautionary statements and risk
factors contained in this and other documents that the Company files from time
to time with the Securities and Exchange Commission.

|ITEM 1 | IDENTITY OF DIRECTORS,
      SENIOR MANAGEMENT AND ADVISERS
|------ | -----------------------------------------------------------

Not applicable for an annual report.

8

---

|ITEM 2 | OFFER STATISTICS AND
      EXPECTED TIMETABLE
|------ | ---------------------------------------------

Not applicable for an annual report.

|ITEM 3 | KEY INFORMATION
|------ | ---------------

|A. | SELECTED FINANCIAL DATA
|-- | -----------------------

The following tables summarize selected financial data for the
Company (stated in Canadian dollars) prepared, in respect of the years ended
July 31, 2015 and July 31, 2014, in accordance with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards
Board (IASB) (IFRS-IASB).

As permitted by SEC Release No. 33-8879 Acceptance from
Foreign Private Issuers of Financial Statements Prepared in Accordance with
International Reporting Standards Without Reconciliation to U.S. GAAP, the
Company includes selected financial data prepared in compliance with IFRS-IASB
without reconciliation to U.S. GAAP.

The selected financial data of the Company for the fiscal years
presented was derived from the consolidated financial statements of the Company
that have been audited by Davidson & Company LLP, independent Registered
Public Accountants, as indicated in their audit report which is included at
Exhibit 99.1 in this Annual Report.

The auditors conducted their audits in accordance with United
States and Canadian generally accepted auditing standards, and the standards of
the Public Company Accounting Oversight Board (United States).

Year ended
    
    
    Year ended
    
    
    Year ended
    
    
    Year ended
    
    
    Year endedJuly 31, 2015
    
    
    July 31, 2014
    
    
    July 31, 2013
    
    
    July 31, 2012
    
    
    July 31, 2011Sales revenue
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    Loss from operations
    $
    1,410,322
    
    $
    865,427
    
    $
    3,458,827
    
    $
    3,587,805
    
    $
    174,867Loss and comprehensive loss
    $
    1,410,322
    
    $
    865,427
    
    $
    3,458,827
    
    $
    3,587,805
    
    $
    183,483Basic and diluted loss per common share
    $
    0.05
    
    $
    0.03
    
    $
    0.13
    
    $
    0.20
    
    $
    0.01Dividends per share
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    Working capital
    $
    (2,548,933
    )
    $
    (2,527,095
    )
    $
    (1,743,116
    )
    $
    911,035
    
    $
    57,066Total assets
    $
    $478,407
    
    $
    1,975,310
    
    $
    2,469,814
    
    $
    2,821,289
    
    $
    99,230Shareholders equity
    $
    (2,998,931
    )
    $
    (1,588,609
    )
    $
    (723,182
    )
    $
    989,036
    
    $
    57,067Share capital
    $
    26,050,118
    
    $
    26,050,118
    
    $
    26,050,118
    
    $
    24,514,381
    
    $
    20,375,746Shares outstanding
    
    27,299,513
    
    
    27,299,513
    
    
    27,299,513
    
    
    22,032,793
    
    
    13,399,422


Currency and Exchange Rates

On November 24, 2015 the rate of exchange of the Canadian
dollar, based on the daily noon rate in Canada as published by the Bank of
Canada, was US$1 = Canadian $1.3308. Exchange rates published by the Bank of
Canada are, available on its website www.bankofcanada.ca, nominal
quotations  not buying or selling rates  and are intended for statistical or
analytical purposes.

The following tables set out the exchange rates, based on the
daily noon rates in Canada as published by the Bank of Canada for the conversion
of Canadian dollars per U.S. dollar.

9

---

For the fiscal
      year ended July 31 (Canadian Dollars per U.S. Dollar)2015
    2014
    2013
    2012
    2011End of Period
    1.3047
    $1.0890
    $1.0287
    $1.0014
    $0.9538Average for the
      Period (1)
    1.1924
    $1.0733
    $1.0070
    $1.0084
    $0.9930High for the
      Period
    1.3060
    $1.1251
    $1.0576
    $1.0604
    $1.0642Low for the Period
    1.0857
    $1.0237
    $0.9710
    $0.9980
    $0.9449


|(1) | The average rate for each period is the average of the
      daily noon rates on the last day of each month during the
  period.
|--- | --------------------------------------------------------------------------------------------------------------------------------

Monthly High and Low Exchange Rate (Canadian Dollars per U.S.
      Dollar)Month
    High
    LowNovember 2015 (to
      November 24, 2015)
    1.3357
    1.3095October 2015
    1.3242
    1.2904September 2015
    1.3413
    1.3147August 2015
    1.3303
    1.2973July 2015
    1.3060
    1.2566June 2015
    1.2550
    1.2209May 2015
    1.2485
    1.1951


|B. | CAPITALIZATION AND
INDEBTEDNESS
|-- | -------------------------------

Not applicable.

|C. | REASONS FOR THE OFFER AND USE OF
  PROCEEDS
|-- | -------------------------------------------

Not applicable.

|D. | RISK FACTORS
|-- | ------------

Due to the nature of the Company's business and the present
stage of exploration and development of its projects in British Columbia, an
investment in the securities of Quartz Mountain is highly speculative and
subject to a number of risks. Briefly, these include the highly speculative
nature of the resources industry, characterized by the requirement for large
capital investments from an early stage and a very small probability of finding
economic mineral deposits. In addition to the general risks of mining, there are
country-specific risks, including currency, political, social, permitting and
legal risk.

You should carefully consider the risks described below and the
other information that Quartz Mountain furnishes to, or files with, the
Securities and Exchange Commission and with Canadian securities regulators
before investing in Quartz Mountain's common shares. You should not consider an
investment in Quartz Mountain unless you are capable of sustaining the economic
loss of your entire investment.

Going concern assumption

The Company's consolidated financial statements have been
prepared assuming the Company will continue on a going concern basis. However,
unless additional funding is obtained, this assumption will have to change. The
Company has incurred losses since inception. Failure to continue as a going
concern would require that Quartz Mountain's assets and liabilities be restated
on a liquidation basis, which could differ significantly from the going concern
basis.

10

---

Additional Funding Requirements

At July 31, 2015, the Company had cash and cash equivalents of
$461,986 and a working capital deficit of $2,548,933. Further corporate
activities and development of the Company's properties will require additional
capital. The Company currently does not have sufficient funds to fully develop
the properties it holds. In addition, a positive production decision at these
properties or any other development projects acquired in the future would
require significant capital for project engineering and construction.
Accordingly, the continuing development of the Company's properties will depend
upon the Company's ability to obtain funding through debt or equity financings,
the joint venturing of projects, or other means. It is possible that the
financing required by the Company will not be available, or, if available, will
not be available on acceptable terms. If the Company issues shares to finance
its operations or expansion plans, control of the Company may change and
shareholders may suffer dilution of their investment. If adequate funds are not
available, or are not available on acceptable terms, the Company may not be able
to take advantage of opportunities, or otherwise respond to competitive
pressures and remain in business. In addition, a positive production decision at
any of the Companys current projects or any other development projects acquired
in the future would require significant resources/funding for project
engineering and construction. Accordingly, the continuing development of the
Companys properties will depend upon the Companys ability to obtain financing
through debt financing, equity financing, the joint venturing of projects, or
other means. There is no assurance that the Company will be successful in
obtaining the required financing for these or other purposes, including for
general working capital.

Market for Securities and Volatility of Share Price

There can be no assurance that active trading market in the
Company's securities will be established or sustained. The market price for the
Company's securities is subject to wide fluctuations. Factors such as
announcements of exploration results, as well as market conditions in the
industry or the economy as a whole, may have a significant adverse impact on the
market price of the securities of the Company.

The stock market has from time to time experienced extreme
price and volume fluctuations that have often been unrelated to the operating
performance of particular companies.

Exploration, Development and Mining Risks

Resource exploration, development, and operations are highly
speculative, characterized by a number of significant risks, which even a
combination of careful evaluation, experience and knowledge may not reduce,
including among other things, unsuccessful efforts resulting not only from the
failure to discover mineral deposits but from finding mineral deposits which,
though present, are insufficient in quantity and quality to return a profit from
production. Few properties that are explored are ultimately developed into
producing mines. Unusual or unexpected formations, formation pressures, fires,
power outages, labor disruptions, flooding, explosions, cave-ins, landslides and
the inability to obtain suitable or adequate machinery, equipment or labor are
other risks involved in the operation of mines and the conduct of exploration
programs. The Company will rely upon consultants and others for exploration,
development, construction and operating expertise. Substantial expenditures are
required to establish mineral resources and mineral reserves through drilling,
to develop metallurgical processes to extract the metal from mineral resources,
and in the case of new properties, to develop the mining and processing
facilities and infrastructure at any site chosen for mining.

No assurance can be given that minerals will be discovered in
sufficient quantities to justify commercial operations or that funds required
for development can be obtained on a timely basis. Whether a mineral deposit
will be commercially viable depends on a number of factors, some of which are:
the particular attributes of the deposit, such as size, grade and proximity to
infrastructure; metal prices, which are highly cyclical; and government
regulations, including regulations relating to prices, taxes, royalties, land
tenure, land use, importing and exporting of minerals, and environmental
protection. The exact effect of these factors cannot accurately be predicted,
but the combination of these factors may result in the Company not receiving an
adequate return on invested capital.

The Company will carefully evaluate the political and economic
environment in considering any properties for acquisition.

Future Profits/Losses and Production Revenues/Expenses

The Company has no history of operations or earnings, and
expects that its losses and negative cash flow will continue for the foreseeable
future. The Company currently has a limited number of mineral properties and
there can be no assurance that the Company will, if needed, be able to acquire
additional properties of sufficient technical merit to represent a compelling
investment opportunity. If the Company is unable to acquire additional
properties, its entire prospects will rest solely with its current projects and
accordingly, the risk of being unable to identify a mineral deposit will be
higher than if the Company had additional properties to explore. There can be no
assurance that the Company will ever be profitable in the future. The Company's
operating expenses and capital expenditures may increase in subsequent years as
needed consultants, personnel and equipment associated with advancing
exploration, development and commercial production of its current properties and
any other properties that the Company may acquire are added. The amounts and
timing of expenditures will depend on the progress of on-going exploration and
development, the results of consultants' analyses and recommendations, the rate
at which operating losses are incurred, the execution of any joint venture
agreements with strategic partners, and the Company's acquisition of additional
properties and other factors, many of which are beyond the Company's control.
The Company does not expect to receive revenues from operations in the
foreseeable future, and will incur losses unless and until such time as its
current properties, or any other properties the Company may acquire commence
commercial production and generate sufficient revenues to fund its continuing
operations. The development of the Companys current properties and any other
properties the Company may acquire will require the commitment of substantial
resources to conduct the time-consuming exploration and development of
properties. The Company anticipates that it will retain any cash resources and
potential future earnings for the future operation and development of the
Company's business.

11

---

The Company has not paid dividends since incorporation and the
Company does not anticipate paying dividends in the foreseeable future. There
can be no assurance that the Company will generate any revenues or achieve
profitability.

There can be no assurance that the underlying assumed levels of
expenses will prove to be accurate. To the extent that such expenses do not
result in the creation of appropriate revenues, the Company's business may be
materially adversely affected. It is not possible to forecast how the business
of the Company will develop.

Permits and Licenses

The operations of the Company will require licenses and permits
from various governmental authorities. There can be no assurance that the
Company will be able to obtain all necessary licenses and permits which may be
required to carry out exploration and development of the Company's projects.

Infrastructure Risk

The operations of the Company are carried out in geographical
areas which may lack adequate infrastructure and are subject to various other
risk factors. Mining, processing, development and exploration activities depend,
to one degree or another, on adequate infrastructure. Reliable roads, bridges,
power sources and water supply are important determinants which affect capital
and operating costs. Lack of such infrastructure or unusual or infrequent
weather phenomena, government or other interference in the maintenance or
provision of such infrastructure could adversely affect the Company's
operations, financial condition and results of operations.

Changes in Local Legislation or Regulation

The Company's mining and processing operations and exploration
activities are subject to extensive laws and regulations governing the
protection of the environment, exploration, development, production, exports,
taxes, labour standards, occupational health, waste disposal, toxic substances,
mine and worker safety, protection of endangered and other special status
species and other matters. The Company's ability to obtain permits and approvals
and to successfully operate in particular communities may be adversely impacted
by real or perceived detrimental events associated with the Company's activities
or those of other mining companies affecting the environment, human health and
safety of the surrounding communities. Delays in obtaining or failure to obtain
government permits and approvals may adversely affect the Company's operations,
including its ability to explore or develop properties, commence production or
continue operations. Failure to comply with applicable environmental and health
and safety laws and regulations may result in injunctions, fines, suspension or
revocation of permits and other penalties. The costs and delays associated with
compliance with these laws, regulations and permits could prevent the Company
from proceeding with the development of a project or the operation or further
development of a mine or increase the costs of development or production and may
materially adversely affect the Company's business, results of operations or
financial condition. The Company may also be held responsible for the costs of
addressing contamination at the site of current or former activities or at third
party sites. The Company could also be held liable for exposure to hazardous
substances.

12

---

Land Claims

In Canada, aboriginal interests, rights (including treaty
rights), claims and title may exist notwithstanding that they may be
unregistered or overlap with other tenures and interests granted to third
parties. Generally speaking, the scope and content of such rights are not well
defined and may be the subject of litigation or negotiation with the government.
The government has a legal obligation to consult First Nations on proposed
activities that may have an impact on asserted or proven aboriginal interests,
claims, rights or title. All of the mineral claims in the Companys projects are
identified by the Province of British Columbia as overlapping with areas in
which certain aboriginal groups have asserted aboriginal interests, rights,
claims or, title. Nevertheless, potential overlaps between the Companys
properties and existing or asserted aboriginal interests, rights, claims or,
title, or undefined rights under historic treaties may exist notwithstanding
whether the Province of British Columbia has identified such interests, rights,
claims, title or undefined rights under historic treaties.

Groups Opposed to Mining May Interfere with the Company's
Efforts to Explore and Develop its Properties

Organizations opposed to mining may be active in the regions in
which the Company conducts its exploration activities. Although the Company
intends to comply with all environmental laws and maintain good relations with
local communities, there is still the possibility that those opposed to mining
will attempt to interfere with the development of the Company's properties. Such
interference could have an impact on the Company's ability to explore and
develop its properties in a manner that is most efficient or appropriate, or at
all, and any such impact could have a material adverse effect on the Company's
financial condition and the results of its operations.

Environmental Matters

All of the Company's operations are and will be subject to
environmental laws and regulations, which can make operations expensive or
prohibit them altogether. The Company may be subject to potential risks and
liabilities associated with pollution of the environment and the disposal of
waste products that could occur as a result of its mineral exploration,
development and production. In addition, environmental hazards may exist on a
property in which the Company directly or indirectly holds an interest, which
are unknown to the Company at present and have been caused by previous or
existing owners or operators of the Companys projects. Environmental
legislation provides for restrictions and prohibitions on spills, releases or
emissions of various substances produced in association with certain mining
industry operations which would result in environmental pollution. A breach of
such legislation may result in the imposition of fines and penalties, or the
requirement to remedy environmental pollution, which would reduce funds
otherwise available to the Company and could have a material adverse effect on
the Company. If the Company is unable to fully remedy an environmental problem,
it could be required to suspend operations or undertake interim compliance
measures pending completion of the required remedy, which could have a material
adverse effect on the Company.

There is no assurance that future changes in environmental
regulation, if any, will not adversely affect the Companys operations. There is
also a risk that the environmental laws and regulations may become more onerous,
making the Company's operations more expensive. Many of the environmental laws
and regulations applicable to the Companys operations will require the Company
to obtain permits for its activities. The Company will be required to update and
review its permits from time to time, and may be subject to environmental impact
analyses and public review processes prior to approval of the additional
activities. It is possible that future changes in applicable laws, regulations
and permits or changes in their enforcement or regulatory interpretation could
have a significant impact on some portion of the Company's business, causing
those activities to be economically re-evaluated at that time.

Conflicts of Interest

The Company's directors and officers may serve as directors or
officers of other companies, joint venture partners, or companies providing
services to the Company or they may have significant shareholdings in other
companies. Situations may arise where the directors and/or officers of the
Company may be in competition with the Company. Any conflicts of interest will
be subject to and governed by the law applicable to directors' and officers'
conflicts of interest. In the event that such a conflict of interest arises at a
meeting of the Company's directors, a director who has such a conflict will
abstain from voting for or against the approval of such participation or such
terms. In accordance with applicable laws, the directors of the Company are
required to act honestly, in good faith and in the best interests of the
Company.

13

---

Lack of Revenue and a History of Operating Losses

The Company does not have any operational history or earnings
and the Company has incurred net losses and negative cash flow from its
operations since its incorporation. Although the management of the Company hopes
to eventually generate revenues, significant operating losses are to be
anticipated for at least the next several years and possibly longer. To the
extent that such expenses do not result in the creation of appropriate revenues,
the Company's business may be materially adversely affected. It is not possible
to forecast how the business of the Company will develop.

General Economic Conditions

Global financial markets have experienced a sharp increase in
volatility during the last few years. Market conditions and unexpected
volatility or illiquidity in financial markets may adversely affect the
prospects of the Company and the value of the Company's shares.

Reliance on Key Personnel

The Company is dependent on the continued services of its
senior management team, and its ability to retain other key personnel. The loss
of such key personnel could have a material adverse effect on the Company. There
can be no assurance that any of the Company's employees will remain with the
Company or that, in the future, the employees will not organize competitive
businesses or accept employment with companies competitive with the Company.
Furthermore, as part of the Company's growth strategy, it must continue to hire
highly qualified individuals. There can be no assurance that the Company will be
able to attract, train or retain qualified personnel in the future, which would
adversely affect its business.

Competition

The resources industry is highly competitive in all its phases,
and the Company will compete with other mining companies, many of which have
greater financial, technical and other resources. Competition in the mining
industry is primarily for: attractive mineral rich properties capable of being
developed and producing economically; the technical expertise to find, develop
and operate such properties; the labour to operate the properties; and the
capital for the purpose of funding such properties. Many competitors not only
explore for and mine certain minerals, but also conduct production and marketing
operations on a worldwide basis. Such competition may result in the Company
being unable to acquire desired properties, to recruit or retain qualified
employees or to acquire the capital necessary to fund its operations and develop
its properties. The Company's inability to compete with other mining companies
for these resources could have a materially adverse effect on the Company's
results of operations and its business.

Uninsurable Risks

In the course of exploration, development and production of
mineral properties, certain risks, and in particular, unexpected or unusual
geological operating conditions including rock bursts, cave ins, fires, flooding
and earthquakes may occur. It is not always possible to fully insure against
such risks and the Company may decide not to take out insurance against such
risks as a result of high premiums or other reasons.

Property Title

The acquisition of title to resource properties is a very
detailed and time-consuming process. Title to, and the area of, resource claims
may be disputed. Although the Company believes it has taken reasonable measures
to ensure that title to the mineral claims comprising its projects are held as
described, there is no guarantee that title to any of those claims will not be
challenged or impaired. There may be valid challenges to the title of any of the
mineral claims comprising the Companys projects that, if successful, could
impair development or operations or both.

The mineral property underlying the Company's net smelter
return royalty interest contains no known ore.

The Company holds a 1% net smelter return ("NSR") royalty
interest on the Quartz Mountain Property (renamed "Angel's Camp"), an
exploration stage prospect in Oregon. The Company's interest in the property
will be limited to any future NSR that would be forthcoming only if or when any
mining commences on the property. There is currently no known body of ore on the
property. Extensive additional exploration work will be required to ascertain if
any mineralization may be economic.

14

---

Likely PFIC status has consequences for United States
investors

Potential investors who are U.S. taxpayers should be aware that
the Company expects to be classified for U.S. tax purposes as a passive foreign
investment company ("PFIC") for the current fiscal year, and may also have been
a PFIC in prior years and may also be a PFIC in future years. If the Company is
a PFIC for any year during a U.S. taxpayer's holding period, then such U.S.
taxpayer generally will be required to treat any so-called "excess distribution"
on its common shares, or any gain realized upon a disposition of common shares,
as ordinary income which would be taxed at the shareholder's highest marginal
rates and to pay an interest charge on a portion of such distribution or gain,
unless the taxpayer has made a timely qualified electing fund ("QEF") election
or a mark-to-market election with respect to the shares of the Company. In
certain circumstances, the sum of the tax and the interest charge may exceed the
amount of the excess distribution received, or the amount of proceeds of
disposition realized, by the taxpayer. A U.S. taxpayer who makes a QEF election
generally must report on a current basis its share of the Company's net capital
gain and ordinary earnings for any year in which the Company is a PFIC, whether
or not the Company distributes any amounts to its shareholders. A U.S. taxpayer
who makes the mark-to-market election generally must include as ordinary income
each year the excess of the fair market value of the common shares over the
taxpayer's tax basis therein. See also Item 10E  "Passive Foreign
Investment Company".

Potential investors should also note that recently enacted
legislation may require U.S. shareholders to report their interest in a PFIC on
an annual basis. US shareholders of the Company should consult their tax
advisors as to these reporting requirements as well as the consequences of
investing in the Company.

Penny stock classification

Penny stock classification could affect the marketability of
the Company's common stock and shareholders could find it difficult to sell
their stock The penny stock rules in the United States require a broker-dealer,
prior to a transaction in a penny stock not otherwise exempt from the rules, to
deliver a standardized risk disclosure document that provides information about
penny stocks and the nature and level of risks in the penny stock market. The
broker-dealer also must provide the customer with current bid and offer
quotations for the penny stock, the compensation of the broker-dealer and its
salesperson in the transaction, and monthly account statements showing the
market value of each penny stock held in the customer's account. The bid and
offer quotations, and the broker-dealer and salesperson compensation
information, must be given to the customer orally or in writing prior to
effecting the transaction and must be given to the customer in writing before or
with the customer's confirmation.

Further, the penny stock rules require that prior to a
transaction in a penny stock not otherwise exempt from such rules; the
broker-dealer must make a special written determination that the penny stock is
a suitable investment for the purchaser and receive the purchaser's written
agreement to the transaction. These additional broker-dealer practice and
disclosure requirements may have the effect of reducing the level of trading
activity in the secondary market for the Company's common shares in the U.S.,
and shareholders may find it more difficult to sell their shares.

|ITEM 4 | INFORMATION ON THE
      COMPANY
|------ | --------------------------------

|A. | HISTORY AND DEVELOPMENT OF THE
  COMPANY
|-- | ----------------------------------------

Incorporation

The legal name of the Company is "Quartz Mountain Resources
Ltd."

Quartz Mountain Resources Ltd. was incorporated on August 3,
1982, in British Columbia, Canada, and it continues to subsist under the laws of
the Province of British Columbia.

The Company was originally incorporated as Wavecrest Resources
Ltd., but changed its name to Quartz Mountain Gold Corp. on June 18, 1986. On
November 5, 1997, the name of the Company was changed from Quartz Mountain Gold
Corp. to Quartz Mountain Resources Ltd., and the common shares were consolidated
on a ten-old-for-one-new share basis.

Market for the Company's Securities

The Company's common shares were quoted on NASDAQ SmallCap
Market in the United States from September 17, 1987 until May 12, 1994. The
Company's common shares were also listed on the Toronto Stock Exchange until
November 10, 1994. The Company voluntarily surrendered its listing on the
Vancouver Stock Exchange.

15

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In October 2000, the Company listed on a newly created Tier 3
of the Canadian Venture Exchange (now renamed the TSX Venture Exchange
("TSX-V")). In December 2003, the Company was reclassified as a Tier 2 company
on the TSX-V. On February 17, 2005, the Company transferred its listing to NEX,
a separate board of the TSX-V established in 2003 to provide a new trading forum
for listed companies that had fallen below the TSX-V's continued listing
standards, due to low levels of business activity.

The Company was relisted on the TSX-V on December 30, 2011.

Currently, the Company's common shares trade on the TSX-V under
the symbol QZM, and certain broker-dealers in the United States make market in
the Company's common shares on the OTC Grey Market under the symbol QZMRF.

Offices

The Company's business office is located at 15th Floor, 1040
West Georgia Street, Vancouver, British Columbia V6E 4H1; telephone (604)
684-6365. The Company's registered office is Suite 1500  1055 West Georgia
Street, Vancouver, British Columbia V6E 4N7; telephone (604) 689-9111.

|B. | BUSINESS OVERVIEW
|-- | -----------------

The Company's Business Strategy and Principal Activities

Quartz Mountain is in the business of exploring and developing
mineral properties. The Companys current activities are primarily focused in
British Columbia, Canada, where it has assembled a portfolio of projects through
option or purchase agreements and ground staking. Exploration activities on the
properties are primarily focused on ascertaining whether the properties host
commercially viable mineral deposits.

In the first three years of its existence, the Company was
active in the exploration of small gold and silver prospects in Canada, but none
of these prospects warranted further exploration or development. In 1986, the
Company acquired the Quartz Mountain gold property, located in south central
Oregon, and until January 2002 most of the Company's efforts were expended on
the exploration and maintenance of these claims. The Company's interests in the
Quartz Mountain gold property, and in its other properties, were acquired by
direct purchase, lease and option, or through joint ventures.

The Company sold the Quartz Mountain gold property during 2002,
to Seabridge Resources Ltd. and Seabridge Resources Inc. (collectively
"Seabridge"). Seabridge subsequently changed its name to Seabridge Gold Inc. At
closing, Quartz Mountain received 300,000 Seabridge common shares, 200,000
Seabridge common share purchase warrants, US$100,000 and a 1% NSR from any
future production on the Quartz Mountain gold property. The Seabridge warrants
were exercised and all Seabridge common shares held by the Company have been
sold. The Company's interest in the Quartz Mountain gold property is limited to
the 1% NSR royalty. The Company does not expect to generate any royalty revenue
from the Quartz Mountain gold property (renamed "Angel's Camp" by its subsequent
owners) for several years, and it is not known at this time when any mining will
commence, if at all, on that property.

Following the sale of the Quartz Mountain
  gold property, the Company continued in its efforts to find a suitable mineral
  property for potential acquisition and exploration during the period of 2002 to
  2011.

In December 2011, the Company acquired an option to earn a 100%
interest in the Buck gold-silver property near the town of Houston in central
British Columbia (the Buck Project). Concurrently with the Buck Project
acquisition, the Company completed a $4.2 million private placement financing
and began trading on the TSX-V. Exploration programs were carried out at Buck in
2011 and 2012, confirming targets. Difficult financing conditions for junior
companies in 2013 necessitated that the Company limit its exploration
expenditures and prioritize its property holdings. As a result, Quartz Mountain
terminated its option on the Buck Project in July 2013.

In August 2012, the Company acquired 100% of the Galaxie
copper-gold property in northwestern British Columbia (the Galaxie Project),
and carried out exploration programs in 2012 at five new prospects within the
property as well as at the Gnat porphyry copper deposit.

Quartz Mountain acquired the ZNT Project by utilizing British
Columbias on-line mineral tenure system in 2012. The ZNT Project is located 15
kilometers southeast of the town of Smithers, British Columbia. Exploration in
2012 and 2013 has identified potential for the discovery of a bulk tonnage
silver deposit at ZNT.

In November 2012, Quartz Mountain entered into an option and
joint venture agreement with Amarc Resources Ltd. (Amarc) pursuant to which
Amarc could earn a 40% ownership interest, with an option to acquire an
additional 10% ownership interest, in the Galaxie and ZNT Projects. Amarc gained
an initial 40% interest in the Galaxie and ZNT Projects by funding a drilling
program at Gnat porphyry copper deposit at the Galaxie Project in late 2012.

16

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In June 2013, Quartz Mountain and Amarc entered into an
amendment agreement through which Amarc had an option until October 31, 2013 to
earn a 60% interest in each of the ZNT and Galaxie properties, by making certain
property expenditures. Amarc earned a 60% interest in the ZNT Project but earned
only a 40% interest in the Galaxie Project.

In April 2014, Amarc terminated joint ventures with the Company
and returned earned interests in the Galaxie and ZNT Projects in British
Columbia. As a result, Quartz Mountain owns 100% of the Galaxie and ZNT
Projects.

The Company does not have any operating revenue and anticipates
that it will rely on sales of its equity securities in order to finance its
acquisition and exploration activities.

British Columbia Mineral Tenure

On January 12, 2005, the Province of British Columbia adopted
an on-line mineral tenure system that includes mineral tenure acquisition and
tenure maintenance procedures, as well as a method of converting previous format
claims (legacy claims) to new format claims (cell claims). All of the Company's
mineral tenures have been converted to cell claims resulting in new tenure
numbers and marginally larger claim boundaries. The mineral claims are
maintained through the completion of exploration activities referred to as
"Assessment Work". The financial requirements related to these exploration works
defined by the Provincial Government. Currently the cost to stake a mineral
claim is $1.75 per hectare and the cost of maintaining a claim is $5.00 per
hectare per year during the first two years following location of the mineral
claim, $10.00 per hectare per year in the third and fourth years, $15.00 per
hectare in the fifth and sixth years, and $20.00 per hectare in the seventh and
all succeeding years. If the assessment work is not completed the mineral claims
may be maintained by a cash payment, but if this payment is not made before the
forfeiture date, the tenure is relinquished.

Another type of mineral tenure exists, called crown-granted
mineral claims, on which the perimeter has been physically surveyed.
Crown-granted mineral claims are maintained by paying taxes on an annual basis.
Unlike mineral claims, the taxes can be paid late with penalties and interest.
If the taxes remain unpaid after a specified period of time, the claims will
revert to the Crown and will be subsequently made available for acquisition by
normal procedures.

Environmental Matters

Environmental matters related to mineral exploration companies
in British Columbia are administered by the Ministry of Energy, Mines and
Petroleum Resources. The Company files notice of its work programs with the
Ministry, and a reclamation security is determined that will set aside
sufficient monies to reclaim the exploration sites to their pre-exploration land
use. Typically, no reclamation security is required for non-mechanized
exploration activities such as surface geological, geochemical and geophysical
surveys. However, a reclamation security is generally required for mechanized
activities such as machine work and drilling. The required level of reclamation
usually involves leaving the sites in a geotechnically stable condition, and
grooming the sites to both prevent forest fire hazards and to ensure that
natural regeneration of indigenous plant species can progress within a
reasonable period of time.

17

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|C. | MINERAL PROPERTIES AND EXPLORATION ACTIVITIES AND
      PLANS
|-- | -------------------------------------------------------------

Galaxie Project, Northwestern British Columbia

The area of Quartz Mountain’s Galaxie Project is shown in Figure 1.  A more detailed claim outline is shown in Figure 2.



Figure 1 Property Location

18

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Figure 2 Claim Outline

Agreements

Sale Agreement with Finsbury Exploration Ltd.

In August 2012, Quartz Mountain completed the acquisition of a
100% interest in the Galaxie Project from Finsbury Exploration Ltd (Finsbury),
a Non-Arms Length Party, through a sale agreement (the Sale Agreement) dated
July 27, 2012. The Galaxie Project-area acquired from Finsbury included an area
of 1,488 square kilometers, comprised of three mineral claims totaling 1,294.3
hectares (the Gnat Pass Property) and the surrounding mineral claims staked by
Finsbury to that time.

Pursuant to the terms of the Sale Agreement, Quartz Mountain
issued 2,038,111 shares to Finsbury and assumed the rights and obligations of
Finsbury under a mineral property purchase agreement (the Bearclaw Agreement)
on the Gnat Pass Property between Finsbury and Bearclaw Capital Corp.
(Bearclaw). Quartz Mountain also assumed the rights and obligations under an
NSR Royalty Agreement which requires the payment to Bearclaw of a 1% NSR royalty
on the Gnat Pass Property up to a maximum of $7,500,000.

The remaining payment obligations to Bearclaw for the Gnat Pass
Property under the Bearclaw Agreement to be assumed by Quartz Mountain consisted
of:

|1. | a payment, on or before August 20, 2012, to Bearclaw of
      $50,000 in cash (paid);                                                                                                                               
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                     
|2. | the issuance, on or before August 20, 2012, to Bearclaw
      of a convertible debenture note in the amount of $650,000 at a rate of 8%
      per annum and with a maturity date of October 31, 2013 (issued);
  and
|   |                                                                                                                                                                                                                     
|3. | the issuance, following the closing date of the
      transactions contemplated in the Sale Agreement, to Bearclaw of 1,000,000
      shares in the capital of Quartz Mountain (issued).                            

The convertible debenture was subsequently amended in July 2013
and October 2014 (See ITEM 5B).

Quartz Mountain and Amarc Joint Venture on Galaxie and ZNT

In November 2012, Quartz Mountain and Amarc Resources Ltd.
(Amarc), a public company listed on the TSX-V, entered into a binding letter
agreement (Letter Agreement) pursuant to which Quartz Mountain would grant to
Amarc an initial 40% ownership interest in the Galaxie and ZNT Projects, upon
Amarc making a cash payment of $1 million to Quartz and funding $1 million in
exploration expenditures on the Galaxie Project on or before December 31, 2012
(completed).

On June 27, 2013, the Company entered into an amendment
agreement (the "Amendment") whereby, among other things, the Galaxie ZNT Project
was divided into two separate joint ventures, named the "Galaxie Joint Venture"
and the "ZNT Joint Venture". Under the Amendment, Amarc had an option, until
October 31, 2013, to increase its interest in each of the ZNT Joint Venture and
the Galaxie Joint Venture from its current 40% interest to a 60% ownership
interest by funding exploration expenditures of $210,000 and $235,000,
respectively.

In November 2013, Amarc completed sufficient expenditures to
earn a 60% interest in the ZNT Joint Venture. Amarc also advised that it
expected to remain at a 40% interest in the Galaxie Joint Venture. Amarc
returned operatorship of Galaxie and ZNT to Quartz Mountain. In April 2014,
Amarc terminated the joint ventures and returned its interests in the Galaxie
and ZNT Projects to Quartz Mountain.

Location, Access and Local Resources

The Galaxie Project is located on Highway 37, approximately 24
kilometers south of Dease Lake, BC. The Project area currently consists of 158
mineral claims covering an area of approximately 577 square kilometers (57,618.2
hectares).

Paved Highway 37 passes through the center of the Galaxie
Project (Figure 1) and provides year-round direct access to the adjacent project
area, including the Gnat Pass Property. Other parts of the Galaxie Project can
be accessed by helicopter.

The operating season for surface exploration is from early June
through to early October. Because of its close proximity to Highway 37, diamond
drilling activities at the Gnat deposit, within the Gnat Pass Property, can be
carried out throughout the year.

Dease Lake (population of about 600) offers an array of
services, including motel accommodations, food, fuel, a variety of small
equipment operators, post office, health clinic and government services. Mining
and exploration make up the most substantial industry. Regional Power manages
the off-grid Dease Lake Generating Station, located about 30 km west of Dease
Lake. The facility supplies the entire energy load for the community of Dease
Lake. Construction of a 287-kilovolt transmission line, extending 344 kilometers
from the existing Skeena substation south of Terrace to a new substation near
Bob Quinn Lake, about 180 kilometers by road south of Dease Lake was completed
in 2014. It supplies the new Red Chris mine by way of a spur line at Bob Quinn
Lake.

19

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Property Description

The Galaxie Project is comprised of some of the claims acquired
through the Sale Agreement with Finsbury described above (including all of those
claims acquired from Bearclaw) and additional claims staked by Quartz Mountain.
Names and expiry dates for the claims are summarized below:

Property
    Claim Name
    Expiry dateGnat Pass
    Tenure # 512878 (no name)
    Aug 17, 2016Tenure
      # 525819 (Gnat North)Tenure
      # 607847 (Gnat 3)Galaxie Claims
    Tenure
      #s 1014077  1014104Stu 001-012, 13, 014-024, 050, 055-060, 063-064, 067-070,
      074, 077-078, 080-089, 155, 157-158, 161-162, 168, 171-174, 178-
      181, 228-237, 240-241, 246-247, 250-260, 274-289 (880610),
      300-302, 372 (942614), 372 (983855), 373 (983863), 374
      (983874),373 (991847), 374 (991824), 374 (983876), 375-388


Quartz Mountain will decide whether to return the Gnat Pass
claims and whether to retain the mineral claims expiring in fiscal 2016 as they
come due.

Geological Setting

The Galaxie Project is underlain mainly by volcanic, intrusive
and lesser sedimentary rocks of the Middle Triassic to Lower Jurassic Stikine
Terrane which, elsewhere in northern British Columbia is known to host the large
Red-Chris, Schaft Creek, Galore and KSM and Snowfield porphyry deposits.

Upper Triassic Stuhini Group volcanic rocks and a quartz
feldspar porphyry dike complex host the Gnat copper deposit. The Gnat deposit is
located near to the northern contact of the Late Triassic to Middle Jurassic,
multiphase Hotailuh Batholith-Three Sisters Pluton intrusive complex, which
occupies most of the remainder of the Galaxie project-area and hosts a number of
base and/or precious metals prospects and showings.

Exploration and Development History

The first record of exploration in the Gnat Pass Property area
was in 1960 when prospecting work by a previous owner discovered copper
mineralization in the vicinity of Lower Gnat Lake. Since that time, at least
nine companies have explored the property completing geological mapping, rock,
soil and stream sediment geochemical sampling, magnetic and induced polarization
(IP) geophysical surveys and diamond drilling during the periods of 1960-1971,
1990-1996 and in 2005. Most of the historical work focused on the Gnat deposit,
and occurrences in the vicinity.

During the period 1965-69, previous operators completed 18,390
meters of diamond drilling in 110 holes in this area. Most of this historical
drilling at the Gnat deposit and carried out over an area measuring about 600
meters by 600 meters, down to a maximum depth of about 300 meters below surface.
The result of a historical estimate of the indicated reserves in the Gnat
deposit was reported in 1972.

Past work on other mineral occurrences on the Galaxie Project
area includes:

| | At Hu, during the period 1969 to 2007, several mining
      companies carried out: silt, soil and rock geochemical sampling;
      geological mapping; Induced Polarization (IP) and ground magnetic surveys;
      and 22 bulldozer trenches.                                                                                                                                               
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                              
| | At Disco, Stikine Moly and Stikine, during the period
      1970-79, two companies carried out: silt, soil and rock geochemical
      sampling; geological mapping; IP, ground magnetic and VLF surveys; and
      limited hand trenching and test-pitting.                                                                                                                                  
|  |                                                                                                                                                                                                                                                                                                                                                                                              
| | At Nup, during the period 1970 to 2008, six mining
      companies and one individual carried out: silt, soil and rock geochemical
      sampling; geological mapping; IP and ground magnetic surveys; and limited
      hand trenching and test-pitting. Three diamond drilling programs (14
      holes) tested porphyry molybdenum+/-copper showings and soil geochemical
      anomalies.
|  |                                                                                                                                                                                                                                                                                                                                                                                              
| | At Pat, during the period 1971-76, two companies carried
      out: grid soil surveys; IP and ground magnetic surveys; and a refraction
      seismic survey.                                                                                                                                                                                                                                

20

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A previous owner completed a first-pass reconnaissance
prospecting and geochemical silt, soil and rock sampling program within a number
of target areas in the Galaxie Claims area in September 2011. Much of the work
was outside of known areas of mineralization, but some work did overlap with
known mineral occurrences, including some of those listed above. A total of 486
silt, 912 soil and 35 rock grab samples were collected.

Sample Preparation and Analyses for 2012-2013 Programs

Silt samples are comprised of fines material taken from the
active part of streams. Sample protocols for soil samples were similar to those
for silt samples. For soil samples, B horizon material was collected at most
sites; in disturbed areas, the top of the C horizon was the preferred sample
medium with surface material or buried organic materials avoided as well as
larger rock fragments, with an average sample size of about 500 grams. For both
soils and silts, sample material was placed into a standard kraft sample bag and
the location was marked by a survey ribbon. Rock samples were collected as a
composite or select grabs of variably mineralized, altered and/or iron-stained
rock chip material. About 2-3 kilograms of sample material was placed into a
plastic bag, identified by an assay ticket and secured with a nylon cable
tie.

Field notes were recorded for each sample including sampler
name; property name; target area and grid number; date and time; sample site
coordinates (UTM, NAD 83 - Zone 9); sample number and sample description. For
rock samples, the size of the occurrence, its orientation (strike and dip if
measurable), host rock, sulphides present and their amounts in percent, and any
other data that would aid in later interpretation after receipt of analytical
results were also recorded. All field notes were later compiled into a digital
file.

Silt and soil samples were hung to dry, then packed in a secure
container and shipped to the Acme Analytical Laboratories Ltd. (Acme)
preparation facility in Smithers, B.C where they were dried at 60° Celsius and
sieved to -80 mesh (0.18 mm or 180μm), then shipped to Acmes laboratory in
Vancouver where they were analyzed for gold and multi-elements by ICP
methods.

Rock samples were packed in a secure container and also shipped
to Acmes preparation lab in Smithers, B.C. Entire rock samples were crushed to
80% passing 10 mesh, from which a 250 gram split was taken, and shipped to
Acmes laboratory in Vancouver where the sub-samples were pulverized to 85%
passing 200 mesh (0.075 mm or 75 microns). Then 15 gram splits were analyzed for
gold and multi-elements by acid digestion ICP methods.

All soil, silt and rock samples in the 2013 program were
prepared at the Acme Laboratories in Smithers or Vancouver and analyzed using
their 36 element aqua regia digestion ICP/MS package at the Vancouver, Canada
facility. Rock chip samples >10,000 ppm Zn were also analyzed by 4 acid
digestion ICP-AES finish.

Acme is ISO 9001:2005 certified for the provision of
  assays and geochemical analysis.

Quality assurance/quality control (QA/QC) samples were done
at the laboratory. QA/QC samples were inserted as flows: 1 blank for every 30
regular samples, 1 standard for every 30 regular samples and 1 duplicate for
every 20 regular samples.

Work in 2012-2013

Gnat Deposit

In 2012, Quartz Mountain relogged historical drill holes and
carried out geological mapping in the Gnat deposit-area. Two deep diamond drill
holes totaling 1,164 meters were also drilled into the Gnat deposit to test for
continuation of copper mineralization beneath an area in which a historical
reserve estimate had been completed by a prior operator in 1972. Hole GT12001
drilled in 2012 intersected two intervals of significant copper mineralization,
including 56 meters grading 0.44% Cu, well below the extent of the historical
estimate, demonstrating that porphyry-style copper mineralization in the Gnat
deposit extends over a known vertical range of about 500 meters. In their lower
portions, both holes encountered a major thrust fault which has structurally
superimposed older deposit host rocks over younger, Hazelton Group sedimentary
rocks.

Geological mapping in the Gnat deposit area identified
porphyry-style hydrothermal alteration characterized by occurrences of
k-feldspar veining and flooding, tourmaline in veins or breccia bodies and
chalcopyrite mineralization over a west-northwest trending zone measuring about
3.5 kilometers long by 700 meters to 1,000 meters wide. Contained within this
large 'hydrothermal footprint' are the Creek Zone and Moss copper prospects, the
two main known mineralized zones outside of the Gnat deposit area (see Figure 3
below).

21

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Figure 3 Gnat Deposit Area

There is considerable room to explore for new zones of copper
mineralization at moderate to greater depths in portions of the Gnat deposit, in
the Creek Zone and Moss prospect areas, and elsewhere along the 3.5
kilometer-long zone of porphyry-style hydrothermal alteration. Mineralization
may include porphyry-type deposits or more constrained, but possibly higher
grade, mineralized breccia bodies.

Other Targets

In 2012, Quartz Mountain completed extensive exploration work
on seven IP/soil grids and two target areas throughout the Galaxie Project-area.
Totals of 182 silt, 6,155 soil and 498 rock samples were collected and 308.5
line-km of IP surveys were completed on the grids. These surveys delineated four
porphyry copper targets and a silver skarn target for ground follow-up.

Amarc completed programs at a few of these targets in 2013 as
part of its earn-in obligations under the amended joint venture agreement on
Galaxie. The 2013 programs included geological mapping, 10 line kilometers of IP
ground geophysical surveying and collection of 96 rock and 246 soil geochemical
samples. No immediate drill targets were identified; however, a series of alkali
intrusions which are known to be the principal hosts in the Stikine-Iskut
porphyry belt for porphyry copper-gold deposits were observed during the 2013
program around one of the targets, called Hu.

One of the target areas identified by Quartz Mountain but not
followed up in 2013 is called Dalvenie East. The Dalvenie East target-area is
located about 7 km south of the Gnat deposit. Preliminary prospecting of two
gossans in the area by Quartz Mountain was successful in locating encouraging
copper mineralization in chalcopyrite +/- bornite veins up to 10 cm wide, hosted
in chlorite-altered diorite to monzodiorite wall rocks. Narrow k-feldspar
alteration envelopes surrounding the veins also contain chalcopyrite and
bornite. Magnetic signatures at Dalvenie East suggest that regional-scale
faults, or subsidiary faults related to them, could control vein-type or
fault-controlled copper-gold mineralization similar to that seen at the nearby
Dalvenie prospect.

As a result of difficult financing conditions for junior
exploration companies, no work was completed at Galaxie in 2014 or 2015. The
potential of the intrusions at Hu warrants further exploration when funds become
available.

Other Properties

ZNT Property

The ZNT Property is located in central British Columbia, some
15 kilometers southeast of the town of Smithers, BC. The property consists of
102 square kilometers (10,171.6 hectares) of mineral claims owned 100% by Quartz
Mountain.

Claim expiry dates are as follows:

22

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Claim Name
    ExpiryZNT 01-21
    August
      06, 2016


The ZNT property was staked by Quartz Mountain in 2012 on the
basis of significant zinc and gold values in regional till samples, as well as
copper and silver mineral occurrences as reported by Geoscience BC and the
provincial government surveys, respectively.

Work in 2012 by Quartz Mountain included soil geochemistry grid
and an IP geophysical survey. A high-contrast, 1,800 meter by 1,200 meter
silver-zinc geochemical anomaly, in part coincident with an extensive IP
chargeability anomaly, was outlined. Programs in 2013 were carried out under the
amended joint venture agreement. A pitting and trenching program was done to
further refine the target identified in 2012, and later tested by a 600-meter,
2-hole drill program. The drill holes indicated a limited extent to the
prospective host rock package and did not encounter economic mineralization. No
further work is planned.

Quartz Mountain will decide whether to retain the mineral
claims expiring in fiscal 2016 as they come due.

Angel's Camp Property

The Company retains a 1% net smelter return royalty payable to
the Company on any production from the Angel's Camp property located in Lake
County, Oregon. The Angel's Camp property is currently held by Alamos Gold
Inc.

During the year ended July 31, 2002, the Company sold 100% of
its title, rights and interest in the Angel's Camp property located in Lake
County, Oregon to Seabridge Resources Inc. ("Seabridge"), which later changed
its name to Seabridge Gold Inc., for 300,000 common shares of Seabridge (sold in
prior years), 200,000 common share purchase warrants of Seabridge (exercised and
sold in prior years), cash of $100,000, and a 1% net smelter return royalty
payable to the Company on any production from the Angel's Camp property.

In 2003, Seabridge optioned a 50% interest in the property to
Quincy Gold Inc., which later changed its name to Golden Predator Mines Inc.,
then to Golden Predator Royalty & Development Corporation, then to Golden
Predator Corporation, and is now named Americas Bullion Royalty Corp
(TSX:AMB).

In April 2012, Orsa Ventures Corp. (Orsa) (TSX-V: ORN)
exercised its option to acquire all of Seabridge's remaining undivided 50%
beneficial joint venture interest in the Angel's Camp property. In March 2013,
Orsa announced it had entered into an agreement with Americas Bullion Royalty
Corp. to acquire, over a number of years, the 50% of Angels Camp that it did
not own. Additionally, in March 2013 Orsa announced that it had received
regulatory approval for, and fulfilled closing requirements for the joint
venture purchase agreement with Americas Bullion Royalty Corp. to acquire their
50% joint venture interest in the Angel's Camp Property.

In September 2013, Alamos Gold Inc. reported the completion of
the acquisition of all of the issued and outstanding common shares of Orsa
Ventures Corp.

|D. | ORGANIZATIONAL STRUCTURE
|-- | ------------------------

The Company operates in a single reportable operating segment 
the acquisition, exploration and development of mineral property interests. The
Company is currently focused on the acquisition and exploration of mineral
property interests in Canada, and conducts most of its business affairs through
its Canadian parent entity.

The Company has one inactive wholly-owned subsidiary, Wavecrest
Resources Inc., a Delaware corporation.

|E. | PROPERTY, PLANT AND
EQUIPMENT
|-- | -----------------------------

The Company has no material tangible fixed assets, such as
mining equipment or plant facilities.

|F. | CURRENCY
|-- | --------

All currency amounts in this Annual Report are stated in
Canadian dollars unless otherwise indicated (see Item 3 for exchange rate
information).

23

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|ITEM 4A | UNRESOLVED STAFF
      COMMENTS
|------- | -------------------------------

Not applicable.

|ITEM 5 | OPERATING AND FINANCIAL
      REVIEW AND PROSPECTS
|------ | --------------------------------------------------

OVERVIEW

As a result of difficult financing conditions for junior
exploration companies, no material exploration work was completed in 2015.
Accordingly, during the fiscal year ended July 31, 2015, the Company's
activities primarily involved seeking joint ventures or farm out agreements to
advance the exploration activities at its properties.

The Company's financial statements are prepared on the basis
that it will continue as a going concern. The Company has incurred losses since
inception, and the ability of the Company to continue as a going concern depends
upon its ability to continue to raise adequate financing and to develop
profitable operations. Quartz Mountain's financial statements do not reflect
adjustments, which could be material, to the carrying values of assets and
liabilities, which may be required should the Company not be able to continue as
a going concern.

The following discussion should be read in conjunction with the
audited annual consolidated financial statements for the years ended July 31,
2015, 2014 and 2013 and the related notes accompanying this Annual Report. The
Company prepares its financial statements in accordance with IFRS. The Company
includes selected financial data prepared in compliance with IFRS without
reconciliation to U.S. GAAP.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The required disclosure is provided in note 2 of the
accompanying audited financial statements as of and for the year ended July 31,
2015, which are presented in Exhibit 99.1 of this Annual Report on Form 20-F.

A.        OPERATING
RESULTS

Comprehensive loss for the year ended July 31, 2015 vs. 2014

The Company recorded a loss from operations of $1,410,000 in
the current year compared to a loss from operations of $865,000 in the prior
fiscal year. The increase in loss during the fiscal year 2015 was due to
impairment of mineral property interest triggered primarily by suppressed prices
of the Companys shares as the capital markets for junior resource companies
continued to deteriorate and the Company curtailed its exploration and
evaluation activities to conserve its cash resources.

24

---

The following table provides a breakdown of exploration costs
incurred during the year ended July 31, 2015:

Galaxie
    
    
    Hotai
    
    
    ZNT
    
    
    Other
    
    
    Total 2015Assaying
    $
    
    
    $
    
    
    $
    
    
    $
    5,147
    
    $
    5,147Drilling
    
    
    
    
    
    
    
    
    
    
    
    
    
    Geological
    
    
    
    
    
    
    
    
    
    
    8,175
    
    
    8,175Graphics
    
    
    
    
    
    
    
    
    
    
    145
    
    
    145Property fees
    
    
    
    
    
    
    
    
    
    
    
    
    
    Site activities
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sustainability
    
    
    
    
    
    
    
    
    
    
    600
    
    
    600Transportation
    
    
    
    
    
    
    
    
    
    
    
    
    
    Travel
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    $
    
    
    $
    
    
    $
    
    
    $
    14,067
    
    $
    14,067


The following table provides a breakdown of exploration costs
incurred during the year ended July 31, 2014:

Galaxie
    
    
    Hotai
    
    
    ZNT
    
    
    Other
      (i)
    
    
    Total 2014Assaying
    $
    7,274
    
    $
    1,053
    
    $
    12,104
    
    $
    490
    
    $
    20,921Drilling
    
    
    
    
    
    
    
    90,773
    
    
    
    
    
    90,773Environmental
    
    
    
    
    
    
    
    1,507
    
    
    
    
    
    1,507Engineering
    
    
    
    
    
    
    
    
    
    
    
    
    
    Geological
    
    30,570
    
    
    3,200
    
    
    45,615
    
    
    (11,698
    )
    
    67,687Graphics
    
    204
    
    
    
    
    
    153
    
    
    3,060
    
    
    3,417Property fees
    
    1,409
    
    
    
    
    
    
    
    
    
    
    
    1,409Site activities
    
    8,529
    
    
    677
    
    
    19,571
    
    
    8,772
    
    
    37,549Socioeconomic
    
    
    
    
    34
    
    
    15,641
    
    
    75
    
    
    15,750Helicopter
    
    4,770
    
    
    
    
    
    
    
    
    
    
    
    4,770Travel
    
    4,672
    
    
    5,530
    
    
    5,337
    
    
    2,649
    
    
    18,188Total
    $
    57,428
    
    $
    10,494
    
    $
    190,701
    
    $
    3,348
    
    $
    261,971


25

---

The following table provides a breakdown of the administration
costs incurred:

|Administration costs         |   | 2015    |  |   | 2014    | 
|---------------------------- | - | ------- |  | - | ------- | 
|                             |   |         |  |   |         | 
|Conferences and travel       | $ |        |  | $ | 8,147   | 
|                             |   |         |  |   |         | 
|Legal, accounting and audit  |   | 34,775  |  |   | 50,321  | 
|                             |   |         |  |   |         | 
|Office and administration    |   | 406,667 |  |   | 505,061 | 
|                             |   |         |  |   |         | 
|Regulatory, trust and filing |   | 20,209  |  |   | 21,904  | 
|                             |   |         |  |   |         | 
|Shareholder communications   |   | 11,122  |  |   | 18,565  | 
|                             |   |         |  |   |         | 
|Total                        | $ | 472,773 |  | $ | 603,998 | 

Administrative costs have tended to follow the trend in the
Company's exploration and business development activities of the Company. They
have been reduced to minimum levels necessary to meet continued disclosure and
corporate governance requirements of a public company.

Comprehensive loss for the year ended July 31, 2014 vs. 2013

The Company recorded a loss from operations of $865,000 in the
2014 fiscal year compared to a loss from operations of $3,459,000 in the 2013
fiscal year.

Exploration and evaluation (E&E) expenditures increased
in the first half of fiscal 2013 due to the acquisition of the Galaxie Project,
and ZNT property. E&E costs decreased after January 2013 as the Company had
been mainly focused on property evaluation activities.

The following tables provide a breakdown of exploration costs
incurred during the year ended July 31, 2013:

Exploration and
    
    
    
    
    
    
    
    
    
    
    (i)evaluation costs
    
    Galaxie
    
    
    Hotai
    
    
    ZNT
    
    
    Other
    
    
    Total 2013Assaying
    $
    239,526
    
    $
    16,976
    
    $
    55,035
    
    $
    48,391
    
    $
    359,928Drilling
    
    265,336
    
    
    
    
    
    
    
    
    
    
    
    265,336Engineering
    
    9,044
    
    
    
    
    
    
    
    
    12,474
    
    
    21,518Environmental
    
    122
    
    
    
    
    
    488
    
    
    
    
    
    610Geological
    
    1,331,104
    
    
    132,127
    
    
    176,547
    
    
    (79,508
    )
    
    1,560,270Graphics
    
    18,913
    
    
    1,615
    
    
    8,899
    
    
    18,037
    
    
    47,464Helicopter
    
    632,568
    
    
    57,997
    
    
    
    
    
    
    
    
    690,565Property fees
    
    15,590
    
    
    14,555
    
    
    53,692
    
    
    125
    
    
    83,962Site activities
    
    626,914
    
    
    9,083
    
    
    71,346
    
    
    15,995
    
    
    723,338Socio economics
    
    12,016
    
    
    725
    
    
    7,230
    
    
    14,362
    
    
    34,333Travel
    
    74,840
    
    
    1,271
    
    
    15,310
    
    
    1,696
    
    
    93,117Total
    $
    3,225,973
    
    $
    234,349
    
    $
    388,547
    
    $
    31,512
    
    $
    3,880,441


|(i) | Recorded under geological expenses are cost recoveries
      pertaining to Mineral Exploration Tax Credits received or receivable from
      the Government of British Columbia
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

26

---

The following table provides a breakdown of the administration
costs incurred:

|Administration costs        |   | 2014    |  |   | 2013      | 
|--------------------------- | - | ------- |  | - | --------- | 
|                            |   |         |  |   |           | 
|Legal, accounting and audit | $ | 50,321  |  | $ | 61,634    | 
|                            |   |         |  |   |           | 
|Office and administration   |   | 505,061 |  |   | 1,161,928 | 
|                            |   |         |  |   |           | 
|Shareholder communication   |   | 18,565  |  |   | 50,541    | 
|                            |   |         |  |   |           | 
|Travel                      |   | 8,147   |  |   | 40,197    | 
|                            |   |         |  |   |           | 
|Trust and filing            |   | 21,904  |  |   | 45,371    | 
|                            |   |         |  |   |           | 
|Total                       | $ | 603,998 |  | $ | 1,359,671 | 

Administrative costs have tended to follow the trend in the
Company's exploration and business development activities of the Company. They
have been reduced to minimum levels necessary to meet continued disclosure and
corporate governance requirements of a public company.

In the 2014 fiscal year, the Company expensed stock options to
employees and directors for $nil compared to $211,000 in the 2013 fiscal year.

|B. | LIQUIDITY AND CAPITAL
RESOURCES
|-- | -------------------------------

Historically, the Company's source of funding has been the
issuance of equity securities for cash, primarily through private placements to
sophisticated investors and institutions. The Company is in the process of
acquiring and exploring mineral property interests. The Company's continuing
operations are entirely dependent upon the ability of the Company to obtain the
necessary financing to complete the exploration and development of its projects,
the existence of economically recoverable mineral reserves at its projects, the
ability of the Company to obtain the necessary permits to mine, on future
profitable production of any mine and the proceeds from the disposition of its
mineral property interests.

At July 31, 2015, the Company had cash and cash equivalents of
$0.46 million and a working capital deficit of $2.6 million. Substantially all
of the total short-term liabilities of $3.0 million at July 31, 2015 were
payable to Hunter Dickinson Services Inc. ("HDSI"). In October 2014, the Company
entered into an agreement with the holder of its convertible debenture to
restructure the payment terms of the debenture.

The Company believes that its liquid assets at July 31, 2015
are sufficient to meet its known obligations, other than the amount payment to
HDSI, it expects to pay over the next 12 months and to maintain its core mineral
rights in good standing for this next 12 month period. The Company is actively
managing its cash reserves, and curtailing activities as necessary in order to
ensure its ability to meet payments as they come due.

Additional debt or equity financing will be required to fund
additional exploration or development programs. However, there can be no
assurance that the Company will continue to obtain additional financial
resources or that it will be able to achieve positive cash flows.

Financial market conditions for junior exploration companies
have resulted in very depressed equity prices. A further and continued
deterioration in market conditions will increase the cost of obtaining capital
and significantly limit the availability of funds to the Company in the future.
Accordingly, management is actively monitoring the effects of the current
economic and financing conditions on the Companys business and reviewing
discretionary spending, capital projects and operating expenditures, and
implementing cash and cash management strategies.

Debenture

In August 2012, pursuant to the Sale Agreement relating to the
Galaxie Project, the Company issued a convertible debenture (the "Debenture") in
the amount of $650,000 maturing on October 31, 2013, and bearing interest at a
rate of 8% per annum (payable quarterly in arrears) to Bearclaw. The Debenture
was convertible into the Company's common shares at a conversion price of $0.40
per share at any time before its expiry.

27

---

July 2013 Amendment

In July 2013, Quartz Mountain and the holder of the Debenture
entered into an agreement to amend the Debenture, whereby among other things,
the Company made a $50,000 payment toward the Debenture reducing the outstanding
balance to $600,000, the interest rate was increased to 10% per annum from 8%
per annum, and the maturity date was extended to October 31, 2014 from October
31, 2013. Interest payments for the Debenture were payable quarterly in arrears
and the Debenture was convertible into the Company's common shares at an
exercise price of $0.15 per share (previously $0.40 per share) on or before
maturity of the Debenture on October 31, 2014. Any interest accrued, but unpaid,
was to be converted at an exercise price of the higher of $0.15 per share
(previously $0.40 per share) and the market price at the time of conversion.

October 2014 Amendment

Effective October 1, 2014, the Company and Bearclaw amended the
terms of the Debenture (hereafter referred to as the Amended Debenture),
pursuant to which:

| | the Company made a principal payment of $50,000 to
      Bearclaw against the Debenture (completed October 8, 2014),                                                                                                           
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                
| | the remaining balance (the Principal Sum) of $550,000
      is repayable in equal annual installments of $50,000, commencing on
      January 31, 2015 (first installment of $50,000 was paid on January 31,
      2105); and
|  |                                                                                                                                                                                                                                
| | effective October 1, 2014, the principal amount
      outstanding bears interest at 7.5% per annum, payable quarterly in
      arrears.                                                                                        

Upon a completion by the Company of an equity financing (the
New Financing) for a minimum amount of $1,000,000, at least 50% of any
outstanding balance of the then-outstanding Principal Sum along with any
interest accrued thereon will be automatically converted (the Automatic
Conversion) into the Companys common shares. Bearclaw may elect to convert,
concurrent with the Automatic Conversion, any portion of the remaining 50% of
the then-outstanding Principal Sum and accrued interest thereon (the Optional
Conversion) into Quartz Mountain common shares. For the purposes of Automatic
Conversion and Optional Conversion, subject to the rules and policies of the
TSX-V, the conversion price will be the greater of (i) the volume-weighted
average trading price of common shares of the Company on the TSX-V for the 20
consecutive trading days ending on the fifth trading day preceding the date of
such conversion, and (ii) the price at which the Company issues common shares
pursuant to the New Financing. For the purposes of Automatic Conversion and
Optional Conversion of any accrued interest, the conversion price will be the
market price of the Companys common shares on the date of conversion. Except
pursuant to the Automatic Conversion and Optional Conversion provisions,
Bearclaw does not have an option to convert the Amended Debenture into the
Companys common shares.

Capital Resources

The Company had no material commitments for capital
expenditures as at July 31, 2015.

The Company has no lines of credit or other sources of
financing which have been arranged but are as of yet, unused.

At July 31, 2015, there were no externally imposed capital
requirements to which the Company is subject and with which the Company has not
complied.

As the Company continues to incur losses in support of the
advancement of exploration activities on its projects, shareholders equity has
come to be in a deficit position.

Requirement of Financing

The Company is in the process of acquiring and exploring
mineral property interests. The Company's continuing operations are entirely
dependent upon the existence of economically recoverable mineral reserves, the
ability of the Company to obtain the necessary financing to complete the
exploration and development of these projects, obtaining the necessary permits
to mine, on future profitable production of any mine and the proceeds from the
disposition of the mineral property interests.

The Company believes that its current liquid assets, as of the
date of this Annual Report, are sufficient to meet all known obligations and to
maintain its core mineral rights in good standing for the next 12 month period.
Additional debt or equity financing will be required to fund additional
exploration or development programs. The Company has a reasonable expectation
that additional funds will be available when necessary to meet ongoing
exploration and development costs. However, there can be no assurance that the
Company will continue to obtain additional financial resources and/or achieve
profitability or positive cash flows. If the Company is unable to obtain
adequate additional financing, the Company will be required to re-evaluate its
planned expenditures until additional funds can be raised through financing
activities.

28

---

Except for the Debenture, the Company has no long-term debt,
capital lease obligations, operating leases or any other long-term obligations.

The Company has no "Purchase Obligations" defined as any
agreement to purchase goods or services that is enforceable and legally binding
on the Company that specifies all significant terms, including: fixed or minimum
quantities to be purchased; fixed, minimum or variable price provisions; and the
approximate timing of the transaction.

|C. | RESEARCH EXPENDITURES
|-- | ---------------------

Quartz Mountain does not carry out any research or development
activities. Please refer to Item 5Aand Item 5Babove for a
discussion of the expenditures that the Company has incurred in connection with
its business activities.

|D. | TREND INFORMATION
|-- | -----------------

As a natural resource exploration company, Quartz Mountain's
activities reflect the traditional cyclical nature of metal prices.
Consequently, Quartz Mountain's business is primarily an "event-driven" business
based on exploration results.

The discussion in this section references calendar years and
dollar amounts are stated in United States dollars.

Copper prices have been variable since late 2011 and averaged
lower in each of the past three years. Prices continue to be variable in 2015.

The gold price was on an uptrend to 2012. Prices decreased in
2013. In 2014 and so far in 2015, gold prices have been variable, with a
decrease in the average price.

An upward trend in silver prices began in 2010, and continued
to late September 2011, with prices reaching as high as $43/oz. Prices ranged
from $26/oz and $35/oz between October 2011 and the end of 2012, then trended
downward in 2013. Although prices have been more variable in 2014 and 2015,
there has been an overall decrease in the average price.

Average annual prices for the past five years as well as the
average prices so far during the 2015 calendar year for copper (Cu), gold (Au)
and silver (Ag) are shown in the table below:

Calendar Year
    Metal Prices (US$)Cu
    Au
    Ag2010
    3.42/lb
    1,228/oz
    20.24/oz2011
    4.00/lb
    1,572/oz
    35.25/oz2012
    3.61/lb
    1,669/oz
    31.16/oz2013
    3.32/lb
    1,410/oz
    23.80/oz2014
    3.11/lb
    1,266/oz
    19.08/oz2015
      to the date of this document
    2.53/lb
    1,171/oz
    15.85/oz


Source: www.metalprices.com

|E. | OFF  BALANCE SHEET
ARRANGEMENTS
|-- | --------------------------------

Quartz Mountain has no off-balance sheet arrangements.

As used in this Item 5E, the term "off-balance sheet
arrangement" means any transaction, agreement or other contractual arrangement
to which an entity, unconsolidated with the Company, is a party, under which the
Company has:

|(a) | any obligation under a guarantee contract that has any of
      the characteristics identified in paragraph 3 of FASB Interpretation No.
      45, Guarantor's Accounting and Disclosure Requirements for Guarantees,
      Including Indirect Guarantees of Indebtedness of Others (November 2002)
      ("FIN 45"), as may be modified or supplemented, excluding the types of
      guarantee contracts described in paragraphs 6 and 7 of FIN
  45;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

29

---

|(b) | a retained or contingent interest in assets transferred
      to an unconsolidated entity or similar arrangement that serves as credit,
      liquidity or market risk support to such entity for such assets;                                                                                                                                                                                                                                                                                                                     
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) | any obligation under a derivative instrument that is both
      indexed to the Company's own stock and classified in stockholders' equity,
      or not reflected, in the Company's statement of financial position;
    or                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(d) | any obligation, including a contingent obligation,
      arising out of a variable interest (as referenced in FASB Interpretation
      No. 46, Consolidation of Variable Interest Entities (January 2003), as may
      be modified or supplemented) in an unconsolidated entity that is held by,
      and material to, the Company, where such entity provides financing,
      liquidity, market risk or credit risk support to, or engages in leasing,
      hedging or research and development services with, the
  Company.

|F. | TABULAR DISCLOSURE OF CONTRACTUAL
    OBLIGATIONS
|-- | -------------------------------------------------

The following obligations existed at July 31, 2015:

|                                      |   | Payments
      due by period | 
|------------------------------------- | - | ---------------------------- | 
|                                      |   |                              | 
|                                      |   | Total                        | 
|Amounts payable and other liabilities | $ | 4,062                        | 
|                                      |   |                              | 
|Convertible debenture                 |   | 500,000                      | 
|                                      |   |                              | 
|Due to a related party                |   | 2,973,276                    | 
|                                      |   |                              | 
|Total                                 | $ | 3,477,338                    | 

The Company has no material capital lease or operating lease
obligations. The Company has no "Purchase Obligations", defined as any agreement
to purchase goods or services that is enforceable and legally binding on the
Company that specifies all significant terms, including: fixed or minimum
quantities to be purchased; fixed, minimum or variable price provisions; and the
approximate timing of the transaction.

|G. | SAFE HARBOR
|-- | -----------

The safe harbor provided in Section 27A of the Securities Act
and Section 21E of the Exchange Act applies to forward-looking information
provided pursuant to Item 5Eand Item 5F above.

|ITEM 6 | DIRECTORS, SENIOR
      MANAGEMENT AND EMPLOYEES
|------ | ------------------------------------------------

|A. | DIRECTORS AND SENIOR
MANAGEMENT
|-- | -------------------------------

Ronald W. Thiessen (1952), President, Chief Executive
Officer and Director

Ronald Thiessen is a Chartered Professional Accountant with
professional experience in finance, taxation, mergers, acquisitions and
re-organizations. Since 1986, Mr. Thiessen has been involved in the acquisition
and financing of mining and mineral exploration companies. Mr. Thiessen is a
director of Hunter Dickinson Inc. (HDI) and its wholly owned subsidiary,
Hunter Dickinson Services Inc. (HDSI), a company providing management and
administrative services to several publicly-traded companies and focuses on
directing corporate development and financing activities.

Mr. Thiessen is, or was within the past five years, an officer
and/or director of the following public companies:

Company
    Positions Held
    From
    ToAmarc Resources Ltd.
    Director
    September 1995
    PresentPresident and Chief 
      Executive
      Officer
    September 2000
    November 2014Chief
      Executive Officer
    November 2014
    Present


30

---

|Company                          | Positions Held      | From          | To          
|-------------------------------- | ------------------- | ------------- | ------------
|                                 |                     |               |             
|Atlatsa Resources Corporation    | Director            | April 1996    | June 2011   
|                                 |                     |               |             
|                                 | Director            | November 1995 | April 2011  
|Continental Minerals Corporation |                     |               |             
|                                 | Co-Chairman         | January 2006  | April 2011  
|                                 |                     |               |             
|Detour Gold Corporation          | Director            | July 2006     | May 2012    
|                                 |                     |               |             
|                                 | Director            | August 1994   | January 2011
|Farallon Mining Ltd.             |                     |               |             
|                                 | Chairman            | December 2005 | January 2011
|                                 |                     |               |             
|                                 | Director            | October 1993  | June 2013   
|Great Basin Gold Ltd.            |                     |               |             
|                                 | Chairman            | November 2006 | June 2013   
|                                 |                     |               |             
|                                 | Director            | November 1995 | Present     
|Northern Dynasty Minerals Ltd.   |                     |               |             
|                                 | President and Chief |               |             
|                                 | Executive Officer   | November 2001 | Present     
|                                 |                     |               |             
|                                 | Director            | December 2011 | Present     
|Quartz Mountain Resources Ltd.   |                     |               |             
|                                 |                     |               |             
|                                 | President and Chief | December 2011 | Present     
|                                 | Executive Officer   |               |             
|                                 |                     |               |             
|                                 | Director            | October 1993  | Present     
|Taseko Mines Limited             |                     |               |             
|                                 | Chairman            | May 2006      | Present     

Scott D. Cousens (1964), Chairman and Director

Mr. Cousens provides management and financial services to a
number of publicly traded companies associated with Hunter Dickinson Inc. His
focus for the past 20 years has been the development of relationships within the
international investment community. Substantial financings and subsequent
corporate success has established strong ties with North American, European and
Middle Eastern investors. Mr. Cousens is also the Director of Capital Finance
for Hunter Dickinson Inc.

Mr. Cousens is, or was within the past five years, an officer
and/or director of the following public companies:

Company
    Positions Held
    From
    ToAmarc Resources
      Ltd.
    Director
    September 1995
    PresentContinental
      Minerals Corporation
    Director
    June
      1994
    April
      2011Heatherdale
      Resources Ltd.
    Chairman and Director
    November 2009
    PresentNorthcliff Resources Ltd.
    Director
    June
      2011
    February 2012Director
    May 2012
    PresentNorthern Dynasty
      Minerals Ltd.
    Director
    June
      1996
    PresentQuartz Mountain
      Resources Ltd.
    Chairman and Director
    November 2012
    PresentRathdowney
      Resources Ltd.
    Director
    June
      2011
    PresentTaseko Mines
      Limited
    Director
    October 1992
    July
      2014


31

---

Robert A. Dickinson (1948), Director

Mr. Dickinson is an economic geologist who has been actively
involved in mineral exploration and mine development for over 40 years. He is
Chairman of HDI and HDSI, as well as a director and member of the management
team of a number of the public companies associated with HDI. He is also
President and Director of United Mineral Services Ltd., a private resource
company. He also serves as a Director of the Britannia Mine Museum and a Trustee
of the BC Mineral Resources Education Program.

Mr. Dickinson is, or was within the past five years, an officer
and/or director of the following public companies:

|Company                          | Positions Held      | From          | To           
|-------------------------------- | ------------------- | ------------- | -------------
|                                 |                     |               |              
|                                 | Director            | April 1993    | Present      
|Amarc Resources Ltd.             |                     |               |              
|                                 | Chairman            | April 2004    | Present      
|                                 |                     |               |              
|Continental Minerals Corporation | Director            | June 2004     | April 2011   
|                                 |                     |               |              
|                                 | Director            | November      | November 2012
|                                 |                     | 2010          |              
|Curis Resources Ltd.             |                     |               |              
|                                 | Chairman            | November      | December 2010
|                                 |                     | 2010          |              
|                                 |                     |               |              
|Heatherdale Resources Ltd.       | Director            | November      | Present      
|                                 |                     | 2009          |              
|                                 |                     |               |              
|Northcliff Resources Ltd.        | Director            | June 2011     | Present      
|                                 |                     |               |              
|                                 | Chairman            | June 2011     | January 2013 
|                                 |                     |               |              
|                                 | Director            | June 1994     | Present      
|Northern Dynasty Minerals Ltd.   |                     |               |              
|                                 | Chairman            | April 2004    | Present      
|                                 |                     |               |              
|                                 | Director            | December 2011 | Present      
|Quartz Mountain Resources Ltd.   |                     |               |              
|                                 | Chairman            | December 2011 | November 2012
|                                 |                     |               |              
|Rathdowney Resources Ltd.        | Director & Chairman | March 2011    | December 2011
|                                 |                     |               |              
|Taseko Mines Limited             | Director            | January 1991  | Present      

James Kerr (1945), Director

Mr. Kerr holds a B.A. degree and graduated from the University
of British Columbia in 1968. Mr. Kerr is a Chartered Professional Accountant and
was a partner at KPMG, a national accounting firm, until his retirement in 2007.
Mr. Kerr has extensive experience in public practice, and actively involved with
audit committees of mining and energy companies, providing advice on accounting
and compliance issues based on a risk management approach.

Mr. Kerr is, or was within the past five years, a director of
the following public companies:

Company
    Positions Held
    From
    ToCuris Resources Ltd.
    Director
    November 2010
    November 2014Quartz Mountain Resources Ltd.
    Director
    December 2011
    Present


32

---

David Mordant (1944), Director

Mr Mordant is the retired founder and CEO of an agricultural
commodities trading business that was sold to a listed company. He has focused
on commodity and stock market trading in local and international markets since
2002 and has been a guest commentator on CNBC on commodities and stocks.

Mr. Mordant is, or was within the past five years, a director
of the following public companies:

Company
    Positions Held
    From
    ToQuartz Mountain Resources Ltd.
    Director
    December 2011
    Present


Gordon Fretwell (1953), Director

Mr. Fretwell holds a B.Comm, degree and graduated from the
University of British Columbia in 1979 with his Bachelor of Law degree. Formerly
a partner in a large Vancouver law firm, Mr. Fretwell has, since 1991, been a
self-employed solicitor (Gordon J. Fretwell Law Corporation) in Vancouver
practicing primarily in the areas of corporate and securities law.

Mr. Fretwell is, or was within the past five years, an officer
and/or director of the following public companies:

Company
    Positions Held
    From
    ToAsanko Gold Inc.
    Director
    February 2004
    PresentAuryn Resources Inc.
    Director
    October 2013
    PresentBell Copper Corporation
    Secretary
    March
      2001
    May
      2011Director
    June
      2001
    April
      2011Benton Capital Corp. (formerly
    Director
    July
      2003
    July
      2013Benton Resources Corp.)
    Secretary
    December 2003
    PresentBenton Resources Inc.
    Director
    November 2011
    March
      2014Secretary
    November 2011
    PresentCanada Rare Earth Corp.
    Secretary
    June
      2009
    PresentContinental Minerals Corporation
    Director
    February 2001
    April
      2011Coro
      Mining Corporation
    Director
    June
      2009
    PresentCoro
      Resources Corp.
    Director
    January 2009
    PresentCuris Resources Ltd.
    Director
    January 2011
    November 2014CVC
      Cayman Venture Corp.
    Director
    July
      2010
    November 2010Lignol Energy Corporation
    Director
    January 2007
    PresentMeritus Minerals Ltd.
    Director
    June
      2007
    November 2012Secretary
    August
      2009
    PresentNorthern Dynasty Minerals Ltd.
    Director
    June
      2004
    PresentQuartz Mountain Resources Ltd.
    Director
    January 2003
    PresentSecretary
    January 2003
    December 2011Rockwell Diamonds Inc.
    Secretary
    September 2012
    Present


33

---

Company
    Positions Held
    From
    ToSokoman Iron Corp. (formerly 
      Golden Dory Resources
      Corp.)
    Secretary
    August 2008
    Present


Lena Brommeland, BSc (1967), Executive Vice President

Lena Brommeland has a BSc in geology and more than 20 years of
experience in mineral project evaluation and on-site management of large-scale
mineral projects, including the Pebble and Niblack projects both located in
Alaska and the Prosperity project in BC.

Ms. Brommeland is, or was within the past five years, a
director or officer of the following public companies:

Company
    Positions Held
    From
    ToRathdowney Resources Ltd.
    Director
    December 2011
    PresentQuartz Mountain Resources Ltd.
    Executive 
      Vice President
    February 2013
    PresentHeatherdale Resources Ltd.
    Director
    March 2014
    Present


Michael Lee, CPA CA, CIA, CISA, CFE, PMP (1967), Chief
Financial Officer

Michael Lee is a Chartered Professional Accountant and has over
15 years of experience in the areas of governance, risk management and financial
reporting, working primarily with Canadian and US public corporations.

Mr. Lee is, or was within the past five years, a director or
officer of the following public companies:

Company
    Positions Held
    From
    ToQuartz Mountain Resources Ltd.
    Chief
      Financial Officer
    February 2013
    Present


Trevor Thomas, LLB (1967), Corporate Secretary

Trevor Thomas has practiced in the areas of corporate
commercial, corporate finance, securities and mining law since 1995, both in a
private practice environment as well as in-house positions and is currently
general counsel for Hunter Dickinson Inc. Prior to joining Hunter Dickinson Inc.
he served as in-house legal counsel with Placer Dome Inc.

Mr. Thomas is, or was within the past five years, an officer of
the following public companies:

Company
    Positions Held
    From
    ToAmarc Resources Ltd.
    Secretary
    February 2008
    PresentAtlatsa Resources Corporation
    Assistant Secretary
    November 2007
    March
      2011Continental Minerals Corporation
    Secretary
    February 2008
    April
      2011Curis Resources Ltd.
    Secretary
    June
      2013
    November 2014Farallon Mining Ltd.
    Secretary
    December 2007
    January 2011Heatherdale Resources Ltd.
    Secretary
    June
      2013
    PresentNorthcliff Resources Ltd.
    Secretary
    June
      2011
    PresentNorthern Dynasty Minerals Ltd.
    Secretary
    February 2008
    Present


34

---

Company
    Positions Held
    From
    ToQuartz Mountain
      Resources Ltd.
    Secretary
    June
      2013
    PresentRathdowney
      Resources Ltd.
    Secretary
    March
      2011
    PresentRockwell Diamonds
      Inc.
    Secretary
    February 2008
    September 2012Taseko Mines
      Limited
    Secretary
    July
      2008
    Present


|B. | COMPENSATION
|-- | ------------

During the Company's financial year ended July 31, 2015, the
aggregate cash compensation paid or payable by the Company to its directors and
senior officers was $103,148.

Ronald W. Thiessen, President, Michael Lee, Chief Financial
Officer, and Lena Brommeland, Executive Vice President, are each "Named
Executive Officers" of the Company for the purposes of the following disclosure.

The compensation paid to the Named Executive Officers during
the Company's most recently completed financial year is as set out below:

Share-
    Option-
    
    All other
    Totalbased
    based
    Pension
    compensa
    compensaName and principal
    Fiscal
    Salary
    awards
    awards
    value
    tion
    tionposition
    year
    ($)
    ($)
    ($)
    ($)
    ($)
    ($)Ronald W. Thiessen
    2015
    Nil
    Nil
    Nil
    Nil
    Nil
    NilPresident and ChiefExecutive Officer
    2014
    Nil
    Nil
    Nil
    Nil
    Nil
    NilMichael Lee (2)
    2015
    28,266
    Nil
    Nil
    Nil
    Nil
    28,266Chief Financial Officer2014
    36,443
    Nil
    Nil
    Nil
    Nil
    36,443Lena Brommeland
    2015
    Nil
    Nil
    Nil
    Nil
    Nil
    NilExecutive Vice President
    2014
    16,742
    Nil
    Nil
    Nil
    Nil
    16,742


During the fiscal year ended July 31, 2015, the above named
NEOs did not serve the Company solely on a full-time basis, and their
compensation from the Company is allocated based on the estimated amount of time
spent providing services to the Company.

Director Compensation

The compensation provided to the directors, excluding a
director who is already set out in disclosure for a NEO for the Company's most
recently completed financial year ended July 31, 2015 is as set out below:

35

---

Non-equityincentiveShare-
    Option-
    plan
    
    All otherFees
    based
    based
    compensa
    Pension
    compensaName
    earned
    awards
    awards
    tion
    value
    tion
    Total($)
    ($)
    ($)
    ($)
    ($)
    ($)
    ($)Scott Cousens(2)(3)
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilRobert A. Dickinson (2)
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilJames Kerr (1)(4)
    26,393
    Nil
    Nil
    Nil
    Nil
    Nil
    26,393David Mordant (1)(5)
    21,601
    Nil
    Nil
    Nil
    Nil
    Nil
    21,601Gordon Fretwell (1)(6)
    26,888
    Nil
    Nil
    Nil
    Nil
    Nil
    26,888


|Notes:
|------
|(1)   
|      
|(2)   
|      
|(3)   
|      
|(4)   
|      
|(5)   
|      
|(6)   

Pension and Retirement Benefits

Neither the Company nor its subsidiary provides any pension,
retirement or similar benefits.

|C. | BOARD PRACTICES
|-- | ---------------

All directors were re-elected at the annual general meeting of
the Company's shareholders held on February 17, 2015. All directors have a term
of office expiring at the next annual general meeting of the Company's
shareholders, which is expected to be held in early 2016. All officers have a
term of office lasting until their removal or replacement by the Board of
Directors.

Directors Service Contracts

There is no written employment contract between the Company and
any director.

There is no service contract between any director of the
Company and either the Company or its subsidiary, which provides for any
benefits upon termination of employment.

Audit and Risk Committee

Composition of Audit and Risk Committee

The members of the Audit and Risk Committee are James Kerr
(Chairman), David Mordant and Gordon J. Fretwell. All Audit and Risk Committee
members are financially literate and no Audit and Risk Committee members are
officers, employees or Control Persons of the Company. Mr. Kerr is a Chartered
Professional Accountant, and hence a financial expert.

Relevant Education and Experience

As a result of their education and experience, each member of
the Audit and Risk Committee has familiarity with, an understanding of, or
experience in the accounting principles used by the Company to prepare its
financial statements, and the ability to assess the general application of those
principles in connection with estimates, accruals and reserves; reviewing or
evaluating financial statements that present a breadth and level of complexity
of accounting issues that are generally comparable to the breadth and complexity
of issues that can reasonably be expected to be raised by the Company's
financial statements; and an understanding of internal controls and procedures
for financial reporting.

36

---

Mr. Kerr is a Chartered Professional Accountant and was a
partner at KPMG, a national accounting firm, until his retirement in 2007. He
has extensive experience in public practice, and actively involved with audit
committees of mining and energy companies, providing advice on accounting and
compliance issues based on a risk management approach. Mr. Fretwell is an
experienced securities lawyer and Mr. Mordant is an experienced businessman with
corporate finance experience. See disclosure under A. Directors and Senior
Management above.

Audit and Risk Committees Charter

The function of the Audit and Risk Committee is to oversee the
employment and compensation of the Companys independent auditor, and other
matters under the authority of the Committee. The Committee also assists the
Board of Directors in carrying out its oversight responsibilities relating to
the Companys financial, accounting and reporting processes, the Companys
system of internal accounting and financial controls, the Companys compliance
with related legal and regulatory requirements, and the fairness of transactions
between the Company and related parties.

The Audit and Risk Committee has a charter that sets out its
mandate and responsibilities, which is contained in Appendix 6 of the Corporate
Governance Policies and Procedures Manual (available for download from the
Companys website under Corporate Governance at
www.quartzmountainresources.com). The Audit and Risk Committee has the
following responsibilities and authority:

Relationship with Independent Auditor

Subject to the law of British Columbia as to the role of the
Shareholders in the appointment of independent auditors, the Committee shall
have the sole authority to appoint or replace the independent auditor.

The Committee shall be directly responsible for the
compensation and oversight of the work of the independent auditor (including
resolution of disagreements between management and the independent auditor
regarding financial reporting) for the purpose of preparing or issuing an audit
report or related work.

The independent auditor shall report directly to the Committee.

The Committee shall approve in advance all audit and permitted
non-audit services with the independent auditor, including the terms of the
engagements and the fees payable; provided that the Committee Chairman may
approve services to be performed by the independent auditor between Committee
meetings if the amount of the fee does not exceed $50,000, provided that any
such approval shall be reported to the Committee at the next meeting thereof.
The Committee may delegate to a subcommittee the authority to grant
pre-approvals of audit and permitted non-audit services, provided that the
decision of any such subcommittee shall be presented to the full Committee at
its next scheduled meeting.

At least annually, the Committee shall review and evaluate the
experience and qualifications of the lead partner and senior members of the
independent auditor team.

At least annually, the Committee shall obtain and review a
report from the independent auditor regarding:

| |  | the independent auditors internal quality-control
      procedures;                                                                                                                                                                                                                                                    
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | any material issues raised by the most recent internal
      quality-control review, or peer review, of the auditor, or by any inquiry
      or investigation by governmental or professional authorities within the
      preceding five years respecting one or more independent audits carried out
      by the firm;
| |  | any steps taken to deal with any such issues; and                                                                                                                                                                                                                                                                       
| |  | all relationships between the independent auditor and the
      Company.                                                                                                                                                                                                                                                

At least annually, the Committee shall evaluate the
qualifications, performance and independence of the independent auditor,
including considering whether the auditors quality controls are adequate and
the provision of permitted non-audit services is compatible with maintaining the
auditors independence.

The Committee shall ensure the rotation of the lead (or
coordinating) audit partner having primary responsibility for the audit, the
concurring partner responsible for reviewing the audit, and other audit partners
as required by law.

The Committee shall consider whether, in order to assure
continuing auditor independence, it is appropriate to adopt a policy of rotating
the independent auditing firm on a regular basis.

37

---

The Committee shall recommend to the Board policies for the
Companys hiring of employees or former employees of the independent auditor who
were engaged on the Companys account or participated in any capacity in the
audit of the Company.

The Committee shall oversee the implementation by management of
appropriate information technology systems for the Company, including as
required for proper financial reporting and compliance.

Financial Statement and Disclosure Review

The Committee shall review and discuss with management and the
independent auditor the annual audited financial statements, including
disclosures made in managements discussion and analysis, and recommend to the
Board whether the audited financial statements should be filed with applicable
securities regulatory authorities and included in the Companys annual reports.

The Committee shall review and discuss with management (and, to
the extent the Committee deems it necessary or appropriate, the independent
auditor) the Companys quarterly financial statements, including disclosures
made in managements discussion and analysis, and recommend to the Board whether
such financial statements should be filed with applicable securities regulatory
authorities.

The Committee shall review and discuss with management and the
independent auditor significant financial reporting issues and judgments made in
connection with the preparation of the Companys financial statements, including
the independent auditors assessment of the quality of the Companys accounting
principles, any significant changes in the Companys selection or application of
accounting principles, any major issues as to the adequacy of the Companys
internal controls over financial reporting, and any special steps adopted in
light of material control deficiencies.

At least annually and prior to the publication of annual
audited financial statements, the Committee shall review and discuss with
management and the independent auditor a report from the independent auditor on:

| |  | all critical accounting policies and practices used by
      the Company;                                                                                                                                                                                                                                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | all alternative accounting treatments of financial
      information that have been discussed with management since the prior
      report, ramifications of the use of such alternative disclosures and
      treatments, the treatment preferred by the independent auditor, and an
      explanation of why the independent auditors preferred method was not
      adopted; and,                              
| |  | other material written communications between the
      independent auditor and management since the prior report, such as any
      management letter or schedule of unadjusted differences, the development,
      selection and disclosure of critical accounting estimates, and analyses of
      the effect of alternative assumptions, estimates or GAAP methods on the
      Companys financial statements.

Prior to their filing or issuance, the Committee shall review
the Companys Annual Information Form, quarterly and annual earnings press
releases, and other financial press releases, including the use of pro forma
or adjusted non-GAAP information.

The Committee shall review and discuss with management the
financial information and earnings guidance provided to analysts and rating
agencies. Such discussion may be specific or it may be in general regarding the
types of information to be disclosed and the types of presentations to be made.

Conduct of the Annual Audit

The Committee shall oversee the annual audit, and in the course
of such oversight the Committee shall have the following responsibilities and
authority: The Committee shall meet with the independent auditor prior to the
audit to discuss the planning and conduct of the annual audit, and shall meet
with the independent auditor as may be necessary or appropriate in connection
with the audit.

The Committee shall ascertain that the independent auditor is
registered and in good standing with the Canadian Public Accounting Board and
that the independent auditor satisfies all applicable independence standards.
The Committee shall obtain from the auditor a written statement delineating all
relationships between the auditor and the Company as per applicable independence
standards, and review relationships that may impact the objectivity and
independence of the auditor.

The Committee shall discuss with the independent auditor the
matters required to be discussed by Statement on Auditing Standards No. 61
relating to the conduct of the audit, including:

| |  | the adoption of, or changes to, the Companys
      significant auditing and accounting principles and practices as suggested
      by the independent auditor, internal auditors or management;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the management letter provided by the
      independent auditor and the Companys response to that letter; and                                                                                  

38

---

| |  | any difficulties encountered in the course of
      the audit work, including any restrictions on the scope of activities or
      access to requested information, and any significant disagreements with
      management.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Committee shall make such inquiries to the management and
the independent auditor as the Committee members deem necessary or appropriate
to satisfy themselves regarding the efficacy of the Companys financial and
internal controls and procedures and the auditing process.

Compliance and Oversight

The Committee shall meet periodically with management and the
independent auditor in separate executive sessions. The Committee may also, to
the extent it deems necessary or appropriate, meet with the Companys investment
bankers and financial analysts who follow the Company.

The Committee shall discuss with management and the independent
auditor the effect of regulatory and accounting initiatives as well as
off-balance sheet structures on the Companys financial statements.

The Committee shall discuss with management the Companys major
financial risk exposures and the steps management has taken to monitor and
control such exposures, including the Companys risk assessment and risk
management policies, and regularly review the top risks identified by management
and the policies and practices adopted by the Company to mitigate those risks.

If required, the Committee shall annually review with
management and the independent auditor the disclosure controls and procedures
and confirm that the Company (with CEO and CFO participation) has evaluated the
effectiveness of the design and operation of the controls within 90 days prior
to the date of filing of the AIF. The Committee also shall review with
management and the independent auditor any deficiencies in the design and
operation of internal controls and significant deficiencies or material
weaknesses therein, and any fraud involving management or other employees who
have a significant role in the Companys internal controls. As a part of that
review, the Committee shall review the process followed in preparing and
verifying the accuracy of the required CEO and CFO annual certifications.

If required, the Committee shall annually, prior to the filing
of the AIF, review managements internal control report and the independent
auditors assessment of the internal controls and procedures.

The Committee shall establish procedures for the receipt,
retention and treatment of complaints received by the Company regarding
accounting, internal accounting controls or auditing matters, and the
confidential, anonymous submission by employees of concerns regarding
questionable accounting or auditing matters.

The Committee shall discuss with management and the independent
auditor any correspondence with regulators or governmental agencies and any
employee complaints or reports which raise material issues regarding the
Companys financial statements or accounting policies.

At least annually, the Committee shall meet with the Companys
legal counsel and discuss any legal matters that may have a material impact on
the financial statements or the Companys compliance policies.

The Committee shall oversee the preparation of reports relating
to the Audit and Risk Committee as required under applicable laws, regulations
and stock exchange requirements.

The Committee shall exercise oversight with respect to
anti-fraud programs and controls.

Related Party Transactions

The Committee shall review for fairness to the Company proposed
transactions, contracts and other arrangements between the Company and its
subsidiaries and any related party or affiliate, and make recommendations to the
Board whether any such transactions, contracts and other arrangements should be
approved or continued. The foregoing shall not include any compensation payable
pursuant to any plan, program, contract or arrangement subject to the authority
of the Companys Compensation Committee.

As used herein the term related party means any officer or
director of the Company or any subsidiary, or any shareholder holding a greater
than 10% direct or indirect financial or voting interest in the Company, and the
term affiliate means any person, whether acting alone or in concert with
others, that has the power to exercise a controlling influence over the Company
and its subsidiaries. "Related party" includes Hunter Dickinson Services Inc.

Compensation Committee

The Boards Compensation Committee currently consists of Scott
Cousens (Chairman), Gordon Fretwell and James Kerr.

39

---

The function of the Compensation Committee is to assist the
Board in carrying out its responsibilities relating to executive and director
compensation. The Compensation Committee has a charter that sets out its mandate
and responsibilities, which is contained in Appendix 7 of the Corporate
Governance Policies and Procedures Manual (available for download from the
Companys website under Corporate Governance at
www.quartzmountainresources.com). In furtherance of its purpose, the
Compensation Committee has the following responsibilities and authority:

|(a) | The Compensation Committee shall recommend to the Board
      the form and amount of compensation to be paid by the Company to directors
      for service on the Board and on Board committees. The Compensation
      Committee shall review director compensation at least annually.                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(b) | The Compensation Committee shall annually review the
      Company's base compensation structure and the Company's incentive
      compensation, stock option and other equity based compensation programs
      and recommend changes in or additions in such structure and plans to Board
      as needed.                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(c) | The Compensation Committee shall recommend to the Board
      the annual base compensation of the Company's executive officers and
      senior managers (collectively the "Officers").                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(d) | The Compensation Committee shall recommend to the Board
      the range of increase or decrease in the annual base compensation for
      non-Officer personnel providing services to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(e) | The Compensation Committee shall recommend to the Board
      annual corporate goals and objectives under any incentive compensation
      plan adopted by the Company for Officers and non- Officer personnel
      providing services to the Company, and recommend incentive compensation
      participation levels for Officers and non-Officer personnel providing
      services to the Company under any such incentive compensation plan. In
      determining the incentive component of compensation, the Committee will
      consider the Company's performance and relative shareholder return, the
      values of similar incentives at comparable companies and the awards given
      in past years.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(f) | The Compensation Committee shall evaluate the performance
      of Officers generally and in light of annual corporate goals and
      objectives under any incentive compensation plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(g) | The Compensation Committee shall periodically review with
      the Chairman and CEO their assessments of corporate officers and senior
      managers and succession plans, and make recommendations to the Board
      regarding appointment of officers and senior managers.                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(h) | The Compensation Committee shall provide oversight of the
      performance evaluation and incentive compensation of non-Officer personnel
      providing services to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(i) | The Compensation Committee shall administer the Company's
      stock option and other equity based compensation plans and determines the
      annual grants of stock options and other equity based
  compensation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(j) | The Compensation Committee shall recommend to the
      Nominating and Governance Committee the qualifications and criteria for
      membership on the Compensation Committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

Other Board Committees

The Company has a Nominating and Corporate Governance Committee
which is responsible for identifying new candidates for the Board of Directors
as necessary, after considering what competencies and skills the directors as a
group should possess and assessing the competencies and skills the directors as
a group should possess and assessing the competencies and skills of the existing
and any proposed directors, and considering the appropriate size of the Board.
The committee is also responsible for developing and recommending to the Board a
set of corporate governance principles applicable to the Chief Financial
Officer, and overseeing the evaluation of the Board and Senior Management. The
current members of the Nominating and Corporate Governance Committee are Gordon
Fretwell, James Kerr, and David Mordant.

The Company has a Special Committee composed of independent
directors of the Company in order to consider the best interests of the Company
related to all matters in respect of any proposed transactions with members of
the Hunter Dickinson group of companies, including proposed transactions between
non-arms length parties, and to make recommendations to the Board in respect of
such matters. The current members of the Special Committee are Gordon Fretwell,
James Kerr, and David Mordant.

|D. | EMPLOYEES
|-- | ---------

At November 25, 2015 the Company had no employees and had
contracted staff on an as-needed basis. The directors of the Company primarily
administer the Company's functions through the employees of HDSI, a private
company with certain directors in common with the Company (see Item 7 
"Major Shareholders and Related Party Transactions").

40

---

|E. | SHARE OWNERSHIP
|-- | ---------------

Security Holdings of Directors and Senior Management

As at November 25, 2015, the directors and officers of Quartz
Mountain and their respective affiliates, directly and indirectly, own or
control as a group an aggregate of 4,809,755 common shares or 17.6% .

As at November 25, 2015, the Company's directors and officers
beneficially own the following number of the Company's common shares, options
and warrants:

|                    |                                            | As a % of outstanding
|------------------- | ------------------------------------------ | ---------------------
|Name of Insider     | Securities Beneficially Owned
      (1)(3) | common shares        
|                    |                                            |                      
|Lena Brommeland     | 215,335 common shares                      | 0.8%                 
|                    |                                            |                      
|                    | 147,177 common shares                      |                      
|Scott Cousens       |                                            | 0.5%                 
|                    | 60,000 options(3)                          |                      
|                    |                                            |                      
|                    | 2,171,730 common shares (2)                |                      
|Robert A. Dickinson |                                            | 8.0%                 
|                    | 60,000 options(3)                          |                      
|                    |                                            |                      
|Gordon J. Fretwell  | 60,000 options(3)                          | nil                  
|                    |                                            |                      
|                    | 88,000 common shares                       |                      
|James Kerr          |                                            | 0.3%                 
|                    | 60,000 options(3)                          |                      
|                    |                                            |                      
|Michael Lee         | nil                                        | nil                  
|                    |                                            |                      
|                    | 107,000 common shares                      |                      
|David Mordant       |                                            | 0.4%                 
|                    | 60,000 options(3)                          |                      
|                    |                                            |                      
|                    | 2,080,514 common shares                    |                      
|Ronald W. Thiessen  |                                            | 7.6%                 
|                    | 60,000 options(3)                          |                      
|                    |                                            |                      
|Trevor Thomas       | nil                                        | nil                  

|Notes:
|------
|(1)   
|      
|(2)   
|      
|(3)   

Share Option Plan

As at November 25, 2015, an aggregate of 768,000 options were
outstanding pursuant to the Company's share option plan (the "Plan"), described
below, and an aggregate of 1,961,951 common shares remained available for
issuance pursuant to the Plan, described below.

The Company adopted the Plan in order to advance the interests
of the Company by providing a means to encourage directors, officers, employees,
and others who provide services to the Company and its subsidiaries to acquire
shares of the Company, thereby increasing their proprietary interest in the
Company, encouraging them to remain associated with the Company and furnishing
them with additional incentive to advance the interests of the Company in the
conduct of their affairs.

The Plan is a "rolling" plan, whereby the maximum number of
shares that may be reserved for issuance pursuant to all option awards granted
under the Plan is 10% of the Company's outstanding common shares, as calculated
at the time that an award is granted. Under the policies of the TSX-V (the
"TSX-V"), the continuation of the Plan required shareholder approval by ordinary
resolution at each annual general meeting of the Company's shareholders. The
Company's shareholders confirmed the Plan in accordance with the policies of the
TSX-V at the Company's last annual general meeting, held on February 17, 2015.

Pursuant to the Plan, if outstanding options are exercised, or expire, or the
  number of issued and outstanding common shares of the Company increases, the
  number of options available to grant under the Plan increases proportionately.
  The exercise price of each option is set by the Compensation Committee of the
  Board of Directors at the time of grant but cannot be less than the Discounted
  Market Price (as defined in, and determined in accordance with, the policies of
  the TSX-V). Options can have a maximum term of five years (or 10 years if the
  Company becomes a Tier 1 issuer on the TSX-V) and typically terminate 90 days
  following the termination of the optionee's employment or engagement, except in
  the case of retirement or death. Vesting of options is at the discretion of the
  Board of Directors at the time the options are granted.

41

---

Eligible Optionees

Under the policies of the TSX-V, to be eligible for the
issuance of a stock option under the Plan, an optionee must either be a
director, officer or employee of the Company, or a consultant or an employee of
a company providing management or other services to the Company, or its
subsidiaries, at the time the option is granted.

Options may be granted only to an individual or to a company
that is wholly-owned by individuals eligible for an option grant. If the option
is granted to a non-individual, the company must provide the TSX-V with an
undertaking that it will not permit any transfer of its securities, nor issue
further securities, to any other individual or entity as long as the incentive
stock option remains in effect without the consent of TSX-V.

Limitations on Awards

No optionee can be granted an option or options to purchase
more than 5% of the outstanding listed shares of the Company in any one year
period.

|ITEM 7 | MAJOR SHAREHOLDERS AND
      RELATED PARTY TRANSACTIONS
|------ | -------------------------------------------------------

|A. | MAJOR SHAREHOLDERS
|-- | ------------------

Quartz Mountain is a publicly-held corporation, with its shares
held by residents of Canada, the United States of America and other countries.
To the best of Quartz Mountain's knowledge, other than as noted below, no
person, corporation or other entity beneficially owns, directly or indirectly,
or controls more than 5% of the common shares of Quartz Mountain, the only class
of securities with voting rights. For these purposes, "beneficial ownership"
means the sole or shared power to vote or direct the voting or to dispose or
direct the disposition of any security.

As of November 25, 2015, Quartz Mountain had authorized
unlimited common shares without par value, of which 27,299,513 were issued and
outstanding. The following table sets forth certain information with respect to
beneficial ownership of the Company's common stock as of November 25, 2015 by
each shareholder known to be the beneficial owner of more than 5% of the common
stock.

Identity of Person or Group
    Shares
    Percentage Beneficially Owned
      of ClassFinsbury
      Exploration Ltd.
    2,038,111
    7.5%Robert A.
      Dickinson
    2,171,730
    8.0%Ronald Thiessen
    2,080,514
    7.6%


All of the common shares have the same voting rights and no
major shareholders of the Company have different voting rights.

Geographic Breakdown of Shareholders

As of November 25, 2015, Quartz Mountain's register of
shareholders indicates that Quartz Mountain's common shares are held as
follows:

42

---

Location
    Number of registered
      shareholders of record
    Number of shares
    Percentage of total
      sharesCanada
    106
    25,822,242
    94.59%United States
    1,473
    1,438,721
    5.27%Other
    13
    38,550
    0.14%Total
    1,592
    27,299,513
    100.0%


Shares registered in the names of intermediaries, were assumed
to be held by residents of the same country in which the intermediary is
located.

Transfer Agent

The Company's common shares are recorded on the books of its
transfer agent, Computershare Investor Services Inc., located at 4th Floor, 510
Burrard Street, Vancouver, B.C. V6C 3B9; telephone (604) 661-9400 in registered
form. However, the majority of the Company's common shares are registered in the
name of intermediaries such as brokerage houses and clearing houses (on behalf
of their respective brokerage clients). Quartz Mountain does not have knowledge
or access to the identities of the beneficial owners of such shares registered
through intermediaries.

Control

To the best of its knowledge, the Company is not owned or
controlled, directly or indirectly, by any other corporation, by any foreign
government or by any other natural or legal person, severally or jointly, other
than as noted above under Major Shareholders. There are no arrangements known to
Quartz Mountain which, at a subsequent date, may result in a change in control
of the Company.

Insider Reports under the Securities Acts of British
Columbia, Alberta and Ontario

Since the Company is a reporting issuer under the Securities
Acts of British Columbia, Alberta and Ontario, certain "insiders" of the Company
(including its directors, certain executive officers, and persons who directly
or indirectly beneficially own, control or direct more than 10% of its common
shares) are generally required to file insider reports of changes in their
ownership of Quartz Mountain's common shares within five days following the
trade under National Instrument 55-104  Insider Reporting Requirements and
Exemptions, as adopted by the CSA, and the Securities Act (Ontario). Copies of
such reports are available for public inspection at the offices of the British
Columbia Securities Commission, 9th Floor, 701 West Georgia Street, Vancouver,
British Columbia V7Y 1L2, (604) 899-6500 or at the British Columbia Securities
Commission web site, www.bcsc.bc.ca. In British Columbia, all insider
reports must be filed electronically five days following the date of the trade
at www.sedi.ca. The public is able to access these reports at
www.sedi.ca.

|B. | RELATED PARTY TRANSACTIONS
|-- | --------------------------

Except as disclosed herein, Quartz Mountain has not, since the
beginning of its last fiscal year ended July 31, 2015:

|(1) | entered into any transactions which are material to
      Quartz Mountain, or a related party or any transactions unusual in their
      nature or conditions involving goods, services or tangible or intangible
      assets to which Quartz Mountain or any of its former subsidiaries was a
      party;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                             
|(2) | entered into any transactions or loans between the
      Company and:                                                                                                                                                                                                                                       

| | (a) | enterprises that directly or indirectly through one or
      more intermediaries, control or are controlled by, or are under common
      control with, Quartz Mountain;                                                                                                                          
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                   
| | (b) | associates of Quartz Mountain (unconsolidated enterprises
      in which Quartz Mountain has significant influence or which has
      significant influence over Quartz Mountain) including shareholders
      beneficially owning 10% or more of the outstanding shares of Quartz
      Mountain;
| |     |                                                                                                                                                                                                                                                                                                   
| | (c) | individuals owning, directly or indirectly, an interest
      in the common shares of Quartz Mountain that gives them significant
      influence over Quartz Mountain, and close members of any such individuals
      family;                                                                  

43

---

| | (d) | key management personnel (persons having authority in
      responsibility for planning, directing and controlling the activities of
      Quartz Mountain including directors and senior management and close
      members of such individuals families); or
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                
| | (e) | enterprises in which a substantial voting interest is
      owned, directly or indirectly, by any person described in (c) or (d) or
      over which such a person is able to exercise significant
  influence.                                                

Hunter Dickinson Services Inc. ("HDSI")

As an umbrella organization, HDSI provides, both cost and
expertise advantages to the companies through access to a shared
multidisciplinary team of mining and financial professionals. This includes:
management capability, geological, engineering and environmental expertise,
financial acumen, and administrative and support services. In addition, HDSI
organizes and shares leased premises and office and technical equipment for
staff to perform their duties.

Quartz Mountain's business relationship with HDSI consists of
utilizing the services described above. HDSI provides these services to Quartz
Mountain which includes the services of Quartz Mountain's President, pursuant to
a standard (within the group) Geological Management and Administration Services
Agreement with HDSI, dated June 1, 2008 (the "Geological Management and
Administration Services Agreement") and amended July 2, 2010. Because of cross
membership of many of the boards of directors within the group, certain members
of management and the Board of Directors of Quartz Mountain are also members of
the board of directors or employees of HDSI.

HDSI's arrangements are also flexible enough that it is able to
defer collection of monthly service invoices and on occasion, where surplus
funds are available to HDSI, make short term advances to members of the group.
The Geological Management and Administration Services Agreement can be
terminated by either party on 30 days' notice.

During the fiscal year ended July 31, 2015, the Company had
transactions totaling $322,063 (2014  $535,392; 2013  $2,585,097) to HDSI for
services and reimbursements of third party disbursements pursuant to this
agreement.

|C. | INTERESTS OF EXPERTS AND
COUNSEL
|-- | --------------------------------

Not applicable.

|ITEM 8 | FINANCIAL
      INFORMATION
|------ | ---------------------------

|A. | CONSOLIDATED STATEMENTS AND OTHER FINANCIAL
      INFORMATION
|-- | -------------------------------------------------------------

Quartz Mountain's audited consolidated annual financial
statements as at and for the year ended July 31, 2015, 2014 and 2013 are
attached in Exhibit 99.1 to this Annual Report.

Legal Proceedings

The Company is not, and has not been in the recent past,
involved in any legal or arbitration proceedings, including governmental
proceedings and those relating to bankruptcy, receivership, or similar
proceedings.

Dividend Policy

The Company has not paid any dividends on its outstanding
common shares since its incorporation and does not anticipate that it will do so
in the foreseeable future. All funds of the Company are being retained for
administration expenses and mineral property investigations.

|B. | SIGNIFICANT CHANGES
|-- | -------------------

There have been no significant changes to the accompanying
financial statements, except as disclosed in this Annual Report on Form 20-F.

44

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|ITEM 9 | THE OFFER AND LISTING
|------ | ---------------------

|A. | OFFER AND LISTING DETAILS
|-- | -------------------------

Trading Markets

The following tables set forth for the periods indicated the
price history, rounded to nearest 1 cent, of the Company's common shares on the
TSX-V (NEX board from 2008 to 2011) and on the OTC Grey Market:

TSX-V
    OTCFiscal year ended July 31
    High (Cdn$)
    Low (Cdn$)
    High (US$)
    Low (US$)2015
    0.06
    0.01
    0.07
    0.022014
    0.12
    0.04
    0.09
    0.062013
    0.35
    0.07
    0.28
    0.072012
    0.50
    0.20
    0.50
    0.202011
    0.49
    0.18
    0.42
    0.162010
    0.30
    0.15
    0.30
    0.13


TSX-V
    OTCFiscal Quarter
    High (Cdn$)
    Low (Cdn$)
    High (US$)
    Low (US$)Q4, 2015
    0.03
    0.01
    0.02
    0.02Q3, 2015
    0.04
    0.03
    0.02
    0.02Q2, 2015
    0.05
    0.03
    0.04
    0.02Q1, 2015
    0.06
    0.04
    0.07
    0.04Q4, 2014
    0.08
    0.04
    0.07
    0.06Q3, 2014
    0.12
    0.08
    0.07
    0.06Q2, 2014
    0.09
    0.07
    0.08
    0.06Q1, 2014
    0.10
    0.07
    0.09
    0.07


TSX-V
    OTCMonth
    High 
      (Cdn$)
    Low 
      (Cdn$)
    High 
      (US$)
    Low 
    (US$)to November 25,
      2015
    0.01
    0.01
    0.01
    0.01October 2015
    0.02
    0.01
    0.01
    0.01September 2015
    0.01
    0.01
    0.01
    0.01August 2015
    0.01
    0.01
    0.02
    0.01July 2015
    0.02
    0.01
    0.02
    0.02


45

---

TSX-V
    OTCMonth
    High (Cdn$)
    Low (Cdn$)
    High (US$)
    Low (US$)June 2015
    0.03
    0.02
    0.02
    0.02May 2015
    0.03
    0.03
    0.02
    0.02April 2015
    0.03
    0.03
    0.02
    0.02


|B. | PLAN OF DISTRIBUTION
|-- | --------------------

Not applicable.

|C. | MARKETS
|-- | -------

On December 30, 2011, the Company acquired a qualifying
property and was relisted on the main board of the TSX Venture Exchange, trading
under the symbol QZM. The Company continues to trade on the OTC Grey Market
under the symbol QZMRF.

On February 17, 2005, the Company transferred its listing to
NEX, a separate board of TSX-V and the Company's common shares traded on NEX
under the symbol QZM.H.

Prior to February 17, 2005, the Company's common shares were
listed and traded in Canada on Tier 2 on the TSX-V, under the symbol QZM.V. The
transition to Tier 2 became effective December 23, 2003. Prior to this, the
Company traded on Tier 3 on the TSX-V.

|D. | SELLING SHAREHOLDERS
|-- | --------------------

Not applicable.

|E. | DILUTION
|-- | --------

Not applicable.

|F. | EXPENSES OF THE ISSUE
|-- | ---------------------

Not applicable.

|ITEM 10 | ADDITIONAL
      INFORMATION
|------- | ----------------------------

|A. | SHARE CAPITAL
|-- | -------------

Not applicable.

|B. | MEMORANDUM AND ARTICLES OF
  ASSOCIATION
|-- | ----------------------------------------

Articles of Association

Quartz Mountain's original corporate constituting documents
comprised of the Memorandum and Articles of Association were registered with the
British Columbia Registrar of Companies under Corporation No. BC0253743. The
Companys Memorandum and Articles have subsequently been replaced by a Notice of
Articles and Articles under the Business Corporations Act (British Columbia)
(BCA), and the Articles were last amended by shareholder resolution at the
Companys Annual General Meeting, held on February 24, 2014. The Company's
articles of incorporation do not contain a description or place any restrictions
on the Company's objects and purposes. For more information, see the Articles of
Amalgamation filed as Exhibit 10.1 to this Form 20-F.

46

---

Certain Powers of Directors

The Companys articles require that a director or senior
officer who holds any office or possesses any property, right or interest that
could result, directly or indirectly, in the creation of a duty or interest that
materially conflicts with that individuals duty or interest as a director or
senior officer, must disclose the nature and extent of the conflict as required
by the BCA.

The BCA requires that every director or senior officer who is a
party to, or who is a director or officer of, or has a material interest in, any
person who is a party to, a material contract or transaction or a proposed
material contract or transaction with the Company, must disclose in writing to
the Company or request to have entered in the minutes of a meeting or a consent
resolution of directors, the nature and extent of his or her interest, and must
refrain from voting in respect of the contract or transaction, unless the
contract or transaction is: (a) one relating primarily to his or her
remuneration as a director of the corporation or an affiliate; (b) one for
indemnity of or insurance for directors as contemplated under the BCA; or (c)
one with an affiliate of the Company. However, a director who is prohibited by
the BCA from voting on a material contract or proposed material contract may be
counted in determining whether a quorum is present for the purpose of the
resolution, if the director disclosed his or her interest in accordance with the
BCA and the contract or transaction was reasonable and fair to the corporation
at the time it was approved.

The Company's Articles provide that the Board will from time to
time determine the remuneration to be paid to the directors. The Company must
reimburse each director for the reasonable expenses that he or she may incur in
and about the business of the Company. The Board may also, by resolution, award
special remuneration to any director for undertaking any professional or other
services on the Company's behalf, outside than the ordinary duties of a director
of the Company.

The Company's Articles provide that the directors may: (a)
borrow money in the manner and amount, on the security, from the sources and on
the terms and conditions that they consider appropriate; (b) issue bonds,
debentures and other debt obligations either outright or as security for any
liability or obligation of the Company or any other person and at such discounts
or premiums and on such other terms as the directors consider appropriate; (c)
guarantee the repayment of money by any other person or the performance of any
obligation of any other person; and (d) mortgage, charge, whether by way of
specific or floating charge, grant a security interest in, or give other
security on, the whole or any part of the present and future assets and
undertaking of the Company.

The directors may, by resolution, amend or repeal any articles
that regulate the business or affairs of the Company. The BCA requires the
directors to submit any such amendment or repeal to the Company's shareholders
at the next meeting of shareholders, and the shareholders may confirm, reject or
amend the amendment or repeal.

The Board does not have a mandatory retirement policy for
directors based solely on age. The Company has a practice of conducting annual
Board, Committee and individual director evaluations, pursuant to which each
director's performance is evaluated annually. There is no minimum share
ownership requirement for directors qualification.

Authorized Share Capital

The Company's authorized share capital consists of an unlimited
number of common shares without par value, and an unlimited number of preferred
shares without par value.

All outstanding common shares of the Company are fully paid and
non-assessable. The holders of the common shares are entitled to one vote per
share at meetings of shareholders and to receive dividends if, as and when
declared by the directors of the Company. In the event of voluntary or
involuntary liquidation, dissolution or winding-up of the Company, after payment
of all outstanding debts, the remaining assets of the Company available for
distribution would be distributed rateably to the holders of the common shares.
Holders of the common shares of the Company have no pre-emptive, redemption,
exchange or conversion rights.

The preferred shares may be issued in series on such terms as
determined by the Company's directors in accordance with the class rights and
restrictions. The special rights and restrictions attaching to the preferred
shares are set forth in Part 26 of the Articles, and provide the directors with
wide latitude to create a series of preferred shares which may be convertible
into common shares, and have attached to them rights that rank ahead of common
shares in respect of entitlement to dividends. The directors may, by resolution,
create, define and attach special rights and restrictions to the shares of each
series, subject to the special rights and restrictions attached to the preferred
shares.

47

---

Except as described above, the Company may not create any class
or series of shares or make any modification to the provisions attaching to the
Company's shares without the affirmative vote of a majority of the votes cast by
the holders of the common shares.

Majority Voting Policy

Under the Companys Corporate Governance Manual, in an
uncontested director election, if the votes for the election of a director
nominee at a meeting of shareholders are fewer than the number voted withhold,
the nominee is expected to submit his or her resignation promptly after the
meeting for the consideration of the Nominating and Governance Committee. The
Nominating and Governance Committee will make a recommendation to the Board of
Directors after reviewing the matter, and the Board of Directors will then
decide whether to accept or reject the resignation. The Boards decision to
accept or reject the resignation will be disclosed to shareholders. The nominee
will not participate in any Nominating and Governance Committee deliberations
whether to accept or reject the resignation.

Meetings of Shareholders

The BCA requires the Company to call an annual shareholders'
meeting not later than 15 months after holding the last preceding annual meeting
and permits the Company to call a special shareholders' meeting at any time. In
addition, in accordance with the BCA, the holders of not less than 5% of the
Company's shares carrying the right to vote at a meeting sought to be held may
requisition the directors to call a special shareholders' meeting for the
purposes stated in the requisition. The Company is required to mail a notice of
meeting and management information circular to registered shareholders not less
than 21 days and not more than 2 months prior to the date of any annual or
special shareholders' meeting. These materials are also filed with Canadian
securities regulatory authorities and furnished to the SEC. The Company's
articles provide that a quorum of two shareholders in person or represented by
proxy holding or representing by proxy at least 10% of the Company's issued
shares carrying the right to vote at the meeting is required to transact
business at a shareholders' meeting. In addition to shareholders and their duly
appointed proxies and corporate representatives, the Company's directors,
president, secretary, lawyers, auditors, and invitees of the directors or
chairperson, are entitled to be admitted to the Company's annual and special
shareholders' meetings; provided that any such person is not to be counted in
the quorum and is not entitled to vote at the meeting unless that person is a
shareholder or proxy holder entitled to vote at the meeting.

Disclosure of Share Ownership

The Securities Act (British Columbia) currently provides that
the directors and certain officers of an issuer and its subsidiaries and any
person or company that beneficially owns, directly or indirectly, voting
securities of an issuer or that exercises control or direction over voting
securities of an issuer or a combination of both, carrying more than 10% of the
voting rights attached to all the issuer's outstanding voting securities (a
"significant shareholder"), as well as the directors and officers of any
significant shareholder, (each an "insider") must, within 10 days of becoming an
insider, file a report in the required form effective the date on which the
person became an insider, disclosing any direct or indirect beneficial ownership
of, or control or direction over, securities of the reporting issuer. The
Securities Act (British Columbia) also provides for the filing of a report by an
insider of a reporting issuer who acquires or transfers securities of the issuer
or who enters into, materially amends or terminates an arrangement the effect of
which is to alter the insider's economic interest in a security of the issuer or
the insider's economic exposure to the issuer. These reports must be filed
within five days after the reportable event. The Securities Act (British
Columbia) also requires these reports to be filed by reporting insiders within
five days after the applicable event, though are only required by the Chief
Executive Officer, Chief Financial Officer, Chief Operating Officer, directors,
any person or company responsible for a principal business unit and significant
shareholders of the Company.

The Securities Act (British Columbia) also provides that a
person or company that acquires (whether or not by way of a take-over bid, offer
to acquire or subscription from treasury) beneficial ownership of voting or
equity securities or securities convertible into voting or equity securities of
a reporting issuer that, together with previously held securities brings the
total holdings of such holder to 10% or more of the outstanding securities of
that class, must (a) issue and file forthwith a news release containing certain
prescribed information and (b) file a report within two business days containing
the same information set out in the news release. The acquiring person or
company must also issue a news release and file a report each time it acquires,
in the aggregate, an additional 2% or more of the outstanding securities of the
same class and every time there is a change to any material fact in the news
release and report previously issued and filed.

The rules in the United States governing the ownership
threshold above which shareholder ownership must be disclosed are more stringent
than those discussed above. Section 13(d) of the Securities

48

---

Exchange Act of 1934, as amended (the "Exchange Act"), imposes
reporting requirements on persons who acquire beneficial ownership (as such term
is defined in Rule 13d-3 under the Exchange Act) of more than 5% of a class of
an equity security registered under Section 12 of the Exchange Act. In general,
such persons must file, within ten days after such acquisition, a report of
beneficial ownership with the SEC containing the information prescribed by the
regulations under Section 13(d) of the Exchange Act and promptly file an
amendment to such report to disclose any material change to the information
reported, including any acquisition or disposition of 1% or more of the
outstanding securities of the registered class. Certain institutional investors
that acquire shares in the ordinary course of business and not with the purpose
or with the effect of changing or influencing the control of the issuer, are
subject to lesser disclosure obligations.

|C. | MATERIAL CONTRACTS
|-- | ------------------

Quartz Mountain's material contracts as of November 25, 2015
are:

| | Corporate Services Agreement with
      HDSI, dated for reference July 2, 2010. See Item 7B;                                                      
|- | --------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                   
| | Convertible Debenture Agreement with
      Bearclaw Capital Corp., dated for reference  August 20, 2012 and
      amendments thereto. See Item 5B;

|D. | EXCHANGE CONTROLS
|-- | -----------------

Quartz Mountain is incorporated pursuant to the laws of the
Province of British Columbia, Canada. There is no law or governmental decree or
regulation in Canada that restricts the export or import of capital, or affects
the remittance of dividends, interest or other payments to a non-resident holder
of common shares, other than withholding tax requirements. Any such remittances
to United States residents are generally subject to withholding tax, however no
such remittances are likely in the foreseeable future. See "Taxation",
below.

There is no limitation imposed by Canadian law or by the
charter or other constituent documents of the Company on the right of a
non-resident to hold or vote Common Shares of the Company, except that the
Investment Canada Act may require review and approval by the Minister of
Industry (Canada) of certain acquisitions of "control" of the Company by a
"non-Canadian". The threshold for acquisitions of "control" is generally defined
as being one-third or more of the voting shares of the Company. "Non-Canadian"
generally means an individual who is not a Canadian citizen or a permanent
resident of Canada, or a corporation, partnership, trust or joint venture that
is ultimately controlled by non-Canadians.

|E. | TAXATION
|-- | --------

Certain Canadian Federal Income Tax Information for United
States Residents

The following summarizes the principal Canadian federal income
tax considerations generally applicable to the holding and disposition of common
shares of the Company by a holder (a) who, for the purposes of the Income Tax
Act (Canada) the ("Tax Act"), is not resident in Canada or deemed to be resident
in Canada, deals at arm's length and is not affiliated with the Company, holds
the common shares as capital property and does not use or hold the common shares
in the course of carrying on, or otherwise in connection with, a business in
Canada, and (b) who, for the purposes of the Canada-United States Income Tax
Convention (the "Treaty"), is a resident of the United States, has never been a
resident of Canada, has not held or used (and does not hold or use) common
shares in connection with a permanent establishment or fixed base in Canada, and
who qualifies for the full benefits of the Treaty. The Canada Revenue Agency has
recently introduced special forms to be used in order to substantiate
eligibility for Treaty benefits, and affected holders should consult with their
own advisors with respect to these forms and all relevant compliance matters.

Holders who meet all such criteria in clauses (a) and (b) above
are referred to herein as a "U.S. Holder" or "U.S. Holders", and this summary
only addresses such U.S. Holders. The summary does not deal with special
situations, such as particular circumstances of traders or dealers, limited
liability companies, tax-exempt entities, insurers, financial institutions
(including those to which the mark-to-market provisions of the Tax Act apply),
or entities considered fiscally transparent under applicable law, or otherwise.

This summary is based on the current provisions of the Tax Act
and the regulations thereunder, all proposed amendments to the Tax Act and
regulations publicly announced by the Minister of Finance (Canada) to the date
hereof, the current provisions of the Treaty and our understanding of the
current administrative practices of the Canada Revenue Agency. It has been
assumed that all currently proposed amendments to the Tax Act and regulations
will be enacted as proposed and that there will be no other relevant change in
any governing law, the Treaty or administrative policy, although no assurance
can be given in these respects. This summary does not take into account
provincial, U.S. or other foreign income tax considerations, which may differ
significantly from those discussed herein.

49

---

This summary is not exhaustive of all possible Canadian income
tax consequences. It is not intended as legal or tax advice to any particular
U.S. Holder and should not be so construed. The tax consequences to a U.S.
Holder will depend on that U.S. Holder's particular circumstances. Accordingly,
all U.S. Holders or prospective U.S. Holders should consult their own tax
advisors with respect to the tax consequences applicable to them having regard
to their own particular circumstances. The discussion below is qualified
accordingly.

Dividends

Dividends paid or deemed to be paid or credited by the Company
to a U.S. Holder are subject to Canadian withholding tax. Under the Treaty, the
rate of withholding tax on dividends paid to a U.S. Holder is generally limited
to 15% of the gross dividend (or 5% in the case of a U.S. holder that is a
corporate shareholder owning at least 10% of the Company's voting shares),
provided the U.S. Holder can establish entitlement to the benefits of the
Treaty.

Disposition

A U.S. Holder is generally not subject to tax under the Tax Act
in respect of a capital gain realized on the disposition of a common share in
the open market, unless the share is "taxable Canadian property" to the holder
thereof and the U.S. Holder is not entitled to relief under the Treaty.

Provided that the Company's common shares are listed on a
"designated stock exchange" for purposes of the Tax Act (which currently
includes the TSX Venture) at the time of disposition, a common share will
generally not constitute taxable Canadian property to a U.S. Holder unless, at
any time during the 60 month period ending at the time of disposition, (i) the
U.S. Holder or persons with whom the U.S. Holder did not deal at arm's length
(or the U.S. Holder together with such persons) owned 25% or more of the issued
shares of any class or series of the Company AND (ii) more than 50% of the fair
market value of the share was derived directly or indirectly from certain types
of assets, including real or immoveable property situated in Canada, Canadian
resource properties or timber resource properties, and options, interests or
rights in respect of any of the foregoing. Common shares may also be deemed to
be taxable Canadian property under the Tax Act in certain specific
circumstances. A U.S. Holder holding Common shares as taxable Canadian property
should consult with the U.S. Holder's own tax advisors in advance of any
disposition of Common shares or deemed disposition under the Tax Act in order to
determine whether any relief from tax under the Tax Act may be available by
virtue of the Treaty, and any related compliance procedures.

United States Federal Income Tax Consequences

The Company believes it is likely a "passive foreign investment
company" which may have adverse U.S. federal income tax consequences for U.S.
shareholders

U.S. shareholders should be aware that the Company believes it was
  classified as a passive foreign investment company ("PFIC") during the tax year
  ended July 31, 2015, and may be a PFIC in future tax years. If the Company is a
  PFIC for any year during a U.S. shareholder's holding period, then such U.S.
  shareholder generally will be required to treat any gain realized upon a
  disposition of common shares, or any so-called "excess distribution" received on
  its common shares, as ordinary income, and to pay an interest charge on a
  portion of such gain or distributions, unless the shareholder makes a timely and
  effective "qualified electing fund" election ("QEF Election") or a
  "mark-to-market" election with respect to the common shares. A U.S. shareholder
  who makes a QEF Election generally must report on a current basis its share of
  the Company's net capital gain and ordinary earnings for any year in which the
  Company is a PFIC, whether or not the Company distributes any amounts to its
  shareholders. However, U.S. shareholders should be aware that there can be no
  assurance that the Company will satisfy record keeping requirements that apply
  to a qualified electing fund, or that the Company will supply U.S. shareholders
  with information that such U.S. shareholders require to report under the QEF
  Election rules, in the event that the Company is a PFIC and a U.S. shareholder
  wishes to make a QEF Election. Thus, U.S. shareholders may not be able to make a
  QEF Election with respect to their common shares. A U.S. shareholder who makes
  the mark-to-market election generally must include as ordinary income each year
  the excess of the fair market value of the common shares over the taxpayer's
  basis therein. This paragraph is qualified in its entirety by the discussion
  below under the heading "Certain United States Federal Income Tax
  Considerations." Each U.S. shareholder should consult its own tax advisor
  regarding the PFIC rules and the U.S. federal income tax consequences of the
  acquisition, ownership, and disposition of common shares.

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Certain United States Federal Income Tax Considerations

The following is a general summary of certain material U.S.
federal income tax considerations applicable to a U.S. Holder (as defined below)
arising from and relating to the acquisition, ownership, and disposition of
common shares.

This summary is for general information purposes only and does
not purport to be a complete analysis or listing of all potential U.S. federal
income tax considerations that may apply to a U.S. Holder arising from and
relating to the acquisition, ownership, and disposition of common shares. In
addition, this summary does not take into account the individual facts and
circumstances of any particular U.S. Holder that may affect the U.S. federal
income tax consequences to such U.S. Holder, including specific tax consequences
to a U.S. Holder under an applicable tax treaty. Accordingly, this summary is
not intended to be, and should not be construed as, legal or U.S. federal income
tax advice with respect to any U.S. Holder. This summary does not address the
U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and
local, and foreign tax consequences to U.S. Holders of the acquisition,
ownership, and disposition of common shares. Each prospective U.S. Holder should
consult its own tax advisor regarding the U.S. federal, U.S. federal alternative
minimum, U.S. federal estate and gift, U.S. state and local, and foreign tax
consequences relating to the acquisition, ownership and disposition of common
shares.

No legal opinion from U.S. legal counsel or ruling from the
Internal Revenue Service (the "IRS") has been requested, or will be obtained,
regarding the U.S. federal income tax consequences of the acquisition,
ownership, and disposition of common shares. This summary is not binding on the
IRS, and the IRS is not precluded from taking a position that is different from,
and contrary to, the positions taken in this summary. In addition, because the
authorities on which this summary is based are subject to various
interpretations, the IRS and the U.S. courts could disagree with one or more of
the conclusions described in this summary.

Scope of this Summary

Authorities

This summary is based on the Internal Revenue Code of 1986, as
amended (the "Code"), Treasury Regulations (whether final, temporary, or
proposed), published rulings of the IRS, published administrative positions of
the IRS, the Convention Between Canada and the United States of America with
Respect to Taxes on Income and on Capital, signed September 26, 1980, as amended
(the "Canada-U.S. Tax Convention"), and U.S. court decisions that are applicable
and, in each case, as in effect and available, as of the date of this document.
Any of the authorities on which this summary is based could be changed in a
material and adverse manner at any time, and any such change could be applied on
a retroactive or prospective basis which could affect the U.S. federal income
tax considerations described in this summary. This summary does not discuss the
potential effects, whether adverse or beneficial, of any proposed legislation
that, if enacted, could be applied on a retroactive or prospective basis.

U.S. Holders

For purposes of this summary, the term "U.S. Holder" means a
beneficial owner of common shares that is for U.S. federal income tax purposes:

| | an individual who is a citizen or resident of
      the U.S.;                                                                                                                           
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                         
| | a corporation (or other entity taxable as a
      corporation for U.S. federal income tax purposes) organized under the laws of the U.S., any state thereof or the
District of Columbia;

| | an estate whose income is subject to U.S.
      federal income taxation regardless of its source; or                                                                                                                                                                         
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                              
| | a trust that (1) is subject to the primary
      supervision of a court within the U.S. and the control of
one or more U.S. persons for all substantial decisions or (2)
has a valid election in effect under applicable Treasury Regulations to be
treated as a U.S. person.

Non-U.S. Holders

For purposes of this summary, a "non-U.S. Holder" is a
beneficial owner of common shares that is not a U.S. Holder. This summary does
not address the U.S. federal income tax consequences to non-U.S. Holders arising
from and relating to the acquisition, ownership, and disposition of common
shares. Accordingly, a non-U.S. Holder should consult its own tax advisor
regarding the U.S. federal, U.S. federal alternative minimum, U.S. federal
estate and gift, U.S. state and local, and foreign tax consequences (including
the potential application of and operation of any income tax treaties) relating
to the acquisition, ownership, and disposition of common shares.

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U.S. Holders Subject to Special U.S. Federal Income Tax
Rules Not Addressed

This summary does not address the U.S. federal income tax
considerations applicable to U.S. Holders that are subject to special provisions
under the Code, including, but not limited to, the following: (a) U.S. Holders
that are tax-exempt organizations, qualified retirement plans, individual
retirement accounts, or other tax-deferred accounts; (b) U.S. Holders that are
financial institutions, underwriters, insurance companies, real estate
investment trusts, or regulated investment companies; (c) U.S. Holders that are
broker-dealers, dealers, or traders in securities or currencies that elect to
apply a mark-to-market accounting method; (d) U.S. Holders that have a
"functional currency" other than the U.S. Dollar; (e) U.S. Holders that own
common shares as part of a straddle, hedging transaction, conversion
transaction, constructive sale, or other arrangement involving more than one
position; (f) U.S. Holders that acquired common shares in connection with the
exercise of employee stock options or otherwise as compensation for services;
(g) U.S. Holders that hold common shares other than as a capital asset within
the meaning of Section 1221 of the Code (generally, property held for investment
purposes); or (h) U.S. Holders that own or have owned (directly, indirectly, or
by attribution) 10% or more of the total combined voting power of the
outstanding shares of the Company. This summary also does not address the U.S.
federal income tax considerations applicable to U.S. Holders who are: (a) U.S.
expatriates or former long-term residents of the U.S.; (b) persons that have
been, are, or will be a resident or deemed to be a resident in Canada for
purposes of the Income Tax Act (Canada) (the "Tax Act"); (c) persons that use or
hold, will use or hold, or that are or will be deemed to use or hold common
shares in connection with carrying on a business in Canada; (d) persons whose
common shares constitute "taxable Canadian property" under the Tax Act; or (e)
persons that have a permanent establishment in Canada for the purposes of the
Canada-U.S. Tax Convention. U.S. Holders that are subject to special provisions
under the Code, including, but not limited to, U.S. Holders described
immediately above, should consult their own tax advisor regarding the U.S.
federal, U.S. federal alternative minimum, U.S. federal estate and gift, U.S.
state and local, and foreign tax consequences relating to the acquisition,
ownership and disposition of common shares.

If an entity or arrangement that is classified as a partnership
(or other "pass-through" entity) for U.S. federal income tax purposes holds
common shares, the U.S. federal income tax consequences to such entity and the
partners (or other owners) of such entity generally will depend on the
activities of the entity and the status of such partners (or owners). This
summary does not address the tax consequences to any such owner. Partners (or
other owners) of entities or arrangements that are classified as partnerships or
as "pass-through" entities for U.S. federal income tax purposes should consult
their own tax advisors regarding the U.S. federal income tax consequences
arising from and relating to the acquisition, ownership, and disposition of
common shares.

Passive Foreign Investment Company Rules

If the Company were to constitute a "passive foreign investment
company" under the meaning of Section 1297 of the Code (a "PFIC", as defined
below) for any year during a U.S. Holder's holding period, then certain
potentially adverse rules will affect the U.S. federal income tax consequences
to a U.S. Holder resulting from the acquisition, ownership and disposition of
common shares. The Company believes that it was classified as a PFIC during the
tax year ended July 31, 2015, and may be a PFIC in future tax years. The
determination of whether any corporation was, or will be, a PFIC for a tax year
depends, in part, on the application of complex U.S. federal income tax rules,
which are subject to differing interpretations. In addition, whether any
corporation will be a PFIC for any tax year depends on the assets and income of
such corporation over the course of each such tax year and, as a result, cannot
be predicted with certainty as of the date of this document. Accordingly, there
can be no assurance that the IRS will not challenge any determination made by
the Company (or any subsidiary of the Company) concerning its PFIC status. Each
U.S. Holder should consult its own tax advisor regarding the PFIC status of the
Company and any subsidiary of the Company.

In addition, in any year in which the Company is classified as
a PFIC, such holder would be required to file an annual report with the IRS
containing such information as Treasury Regulations and/or other IRS guidance
may require. U.S. Holders should consult their own tax advisors regarding the
requirements of filing such information returns under these rules, including the
requirement to file a IRS Form 8621.

PFIC Status of the Company

The Company generally will be a PFIC if, for a tax year, (a)
75% or more of the gross income of the Company is passive income (the "income
test") or (b) 50% or more of the value of the Company's assets either produce
passive income or are held for the production of passive income, based on the
quarterly average of the fair market value of such assets (the "asset test").
"Gross income" generally includes all sales revenues less the cost of goods
sold, plus income from investments and from incidental or outside operations or
sources, and "passive income" generally includes, for example, dividends,
interest, certain rents and royalties, certain gains from the sale of stock and
securities, and certain gains from commodities transactions.

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Active business gains arising from the sale of commodities
generally are excluded from passive income if substantially all (85% or more) of
a foreign corporation's commodities are stock in trade or inventory, depreciable
property used in a trade or business, or supplies regularly used or consumed in
a trade or business and certain other requirements are satisfied.

For purposes of the PFIC income test and asset test described
above, if the Company owns, directly or indirectly, 25% or more of the total
value of the outstanding shares of another corporation, the Company will be
treated as if it (a) held a proportionate share of the assets of such other
corporation and (b) received directly a proportionate share of the income of
such other corporation. In addition, for purposes of the PFIC income test and
asset test described above, and assuming certain other requirements are met,
"passive income" does not include certain interest, dividends, rents, or
royalties that are received or accrued by the Company from certain "related
persons" (as defined in Section 954(d)(3) of the Code), to the extent such items
are properly allocable to the income of such related person that is not passive
income.

Under certain attribution rules, if the Company is a PFIC, U.S.
Holders will generally be deemed to own their proportionate share of the
Company's direct or indirect equity interest in any company that is also a PFIC
(a ''Subsidiary PFIC''), and will be subject to U.S. federal income tax on their
proportionate share of (a) any "excess distributions," as described below, on
the stock of a Subsidiary PFIC and (b) a disposition or deemed disposition of
the stock of a Subsidiary PFIC by the Company or another Subsidiary PFIC, both
as if such U.S. Holders directly held the shares of such Subsidiary PFIC. In
addition, U.S. Holders may be subject to U.S. federal income tax on any indirect
gain realized on the stock of a Subsidiary PFIC on the sale or disposition of
common shares. Accordingly, U.S. Holders should be aware that they could be
subject to tax even if no distributions are received and no redemptions or other
dispositions of common shares are made.

Default PFIC Rules Under Section 1291 of the Code

If the Company is a PFIC for any tax year during which a U.S.
Holder owns common shares, the U.S. federal income tax consequences to such U.S.
Holder of the acquisition, ownership, and disposition of common shares will
depend on whether and when such U.S. Holder makes an election to treat the
Company and each Subsidiary PFIC, if any, as a "qualified electing fund" or
"QEF" under Section 1295 of the Code (a "QEF Election") or makes a
mark-to-market election under Section 1296 of the Code (a "Mark-to-Market
Election"). A U.S. Holder that does not make either a QEF Election or a
Mark-to-Market Election will be referred to in this summary as a "Non-Electing
U.S. Holder." A Non-Electing U.S. Holder will be subject to the rules of Section
1291 of the Code (described below) with respect to (a) any gain recognized on
the sale or other taxable disposition of common shares and (b) any excess
distribution received on the common shares. A distribution generally will be an
"excess distribution" to the extent that such distribution (together with all
other distributions received in the current tax year) exceeds 125% of the
average distributions received during the three preceding tax years (or during a
U.S. Holder's holding period for the common shares, if shorter).

Under Section 1291 of the Code, any gain recognized on the sale
or other taxable disposition of common shares (including an indirect disposition
of the stock of any Subsidiary PFIC), and any "excess distribution" received on
common shares or with respect to the stock of a Subsidiary PFIC, must be ratably
allocated to each day in a Non-Electing U.S. Holder's holding period for the
respective common shares. The amount of any such gain or excess distribution
allocated to the tax year of disposition or distribution of the excess
distribution and to years before the entity became a PFIC, if any, would be
taxed as ordinary income. The amounts allocated to any other tax year would be
subject to U.S. federal income tax at the highest tax rate applicable to
ordinary income in each such year, and an interest charge would be imposed on
the tax liability for each such year, calculated as if such tax liability had
been due in each such year. A Non-Electing U.S. Holder that is not a corporation
must treat any such interest paid as "personal interest," which is not
deductible.

If the Company is a PFIC for any tax year during which a
Non-Electing U.S. Holder holds common shares, the Company will continue to be
treated as a PFIC with respect to such Non-Electing U.S. Holder, regardless of
whether the Company ceases to be a PFIC in one or more subsequent tax years. A
Non-Electing U.S. Holder may terminate this deemed PFIC status by electing to
recognize gain (which will be taxed under the rules of Section 1291 of the Code
discussed above), but not loss, as if such common shares were sold on the last
day of the last tax year for which the Company was a PFIC.

QEF Election

A U.S. Holder that makes a timely and effective QEF Election
for the first tax year in which its holding period of its common shares begins
generally will not be subject to the rules of Section 1291 of the Code discussed
above with respect to its common shares. A U.S. Holder that makes a timely and
effective QEF Election will be subject to U.S. federal income tax on such U.S.
Holder's pro rata share of (a) the net capital gain of the Company, which will
be taxed as long-term capital gain to such U.S. Holder, and (b) the ordinary
earnings of the Company, which will be taxed as ordinary income to such U.S.
Holder. Generally, "net capital gain" is the excess of (a) net long-term capital
gain over (b) net short-term capital loss, and "ordinary earnings" are the
excess of (a) "earnings and profits" over (b) net capital gain. A U.S. Holder
that makes a QEF Election will be subject to U.S. federal income tax on such
amounts for each tax year in which the Company is a PFIC, regardless of whether
such amounts are actually distributed to such U.S. Holder by the Company.
However, for any tax year in which the Company is a PFIC and has no net income
or gain, U.S. Holders that have made a QEF Election would not have any income
inclusions as a result of the QEF Election. If a U.S. Holder that made a QEF
Election has an income inclusion, such a U.S. Holder may, subject to certain
limitations, elect to defer payment of current U.S. federal income tax on such
amounts, subject to an interest charge. If such U.S. Holder is not a
corporation, any such interest paid will be treated as "personal interest,"
which is not deductible.

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A U.S. Holder that makes a timely and effective QEF Election
with respect to the Company generally (a) may receive a tax-free distribution
from the Company to the extent that such distribution represents "earnings and
profits" of the Company that were previously included in income by the U.S.
Holder because of such QEF Election and (b) will adjust such U.S. Holder's tax
basis in the common shares to reflect the amount included in income or allowed
as a tax-free distribution because of such QEF Election. In addition, a U.S.
Holder that makes a QEF Election generally will recognize capital gain or loss
on the sale or other taxable disposition of common shares.

The procedure for making a QEF Election, and the U.S. federal
income tax consequences of making a QEF Election, will depend on whether such
QEF Election is timely. A QEF Election will be treated as "timely" if such QEF
Election is made for the first year in the U.S. Holder's holding period for the
common shares in which the Company was a PFIC. A U.S. Holder may make a timely
QEF Election by filing the appropriate QEF Election documents at the time such
U.S. Holder files a U.S. federal income tax return for such year. If a U.S.
Holder does not make a timely and effective QEF Election for the first year in
the U.S. Holder's holding period for the common shares, the U.S. Holder may
still be able to make a timely and effective QEF Election in a subsequent year
if such U.S. Holder meets certain requirements and makes a "purging" election to
recognize gain (which will be taxed under the rules of Section 1291 of the Code
discussed above) as if such common shares were sold for their fair market value
on the day the QEF Election is effective. If a U.S. Holder owns PFIC stock
indirectly through another PFIC, separate QEF Elections must be made for the
PFIC in which the U.S. Holder is a direct shareholder and the Subsidiary PFIC
for the QEF rules to apply to both PFICs.

A QEF Election will apply to the tax year for which such QEF
Election is timely made and to all subsequent tax years, unless such QEF
Election is invalidated or terminated or the IRS consents to revocation of such
QEF Election. If a U.S. Holder makes a QEF Election and, in a subsequent tax
year, the Company ceases to be a PFIC, the QEF Election will remain in effect
(although it will not be applicable) during those tax years in which the Company
is not a PFIC. Accordingly, if the Company becomes a PFIC in another subsequent
tax year, the QEF Election will be effective and the U.S. Holder will be subject
to the QEF rules described above during any subsequent tax year in which the
Company qualifies as a PFIC.

U.S. Holders should be aware that there can be no assurances
that the Company will satisfy the record keeping requirements that apply to a
QEF, or that the Company will supply U.S. Holders with information that such
U.S. Holders are required to report under the QEF rules, in the event that the
Company is a PFIC. Thus, U.S. Holders may not be able to make a QEF Election
with respect to their common shares. Each U.S. Holder should consult its own tax
advisor regarding the availability of, and procedure for making, a QEF Election.

A U.S. Holder makes a QEF Election by attaching a completed IRS
Form 8621, including a PFIC Annual Information Statement, to a timely filed
United States federal income tax return. However, if the Company cannot provide
the required information with regard to the Company or any of its Subsidiary
PFICs, U.S. Holders will not be able to make a QEF Election for such entity and
will continue to be subject to the rules discussed above that apply to
Non-Electing U.S. Holders with respect to the taxation of gains and excess
distributions.

Mark-to-Market Election

A U.S. Holder may make a Mark-to-Market Election only if the
common shares are marketable stock. The common shares generally will be
"marketable stock" if the common shares are regularly traded on (a) a national
securities exchange that is registered with the Securities and Exchange
Commission, (b) the national market system established pursuant to section 11A
of the Securities and Exchange Act of 1934, or (c) a foreign securities exchange
that is regulated or supervised by a governmental authority of the country in
which the market is located, provided that (i) such foreign exchange has trading
volume, listing, financial disclosure, and surveillance requirements, and meets
other requirements and the laws of the country in which such foreign exchange is
located, together with the rules of such foreign exchange, ensure that such
requirements are actually enforced and (ii) the rules of such foreign exchange
effectively promote active trading of listed stocks. If such stock is traded on
such a qualified exchange or other market, such stock generally will be
"regularly traded" for any calendar year during which such stock is traded,
other than in de minimis quantities, on at least 15 days during each calendar
quarter.

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A U.S. Holder that makes a Mark-to-Market Election with respect
to its common shares generally will not be subject to the rules of Section 1291
of the Code discussed above with respect to such common shares. However, if a
U.S. Holder does not make a Mark-to-Market Election beginning in the first tax
year of such U.S. Holder's holding period for the common shares or such U.S.
Holder has not made a timely QEF Election, the rules of Section 1291 of the Code
discussed above will apply to certain dispositions of, and distributions on, the
common shares.

A U.S. Holder that makes a Mark-to-Market Election will include
in ordinary income, for each tax year in which the Company is a PFIC, an amount
equal to the excess, if any, of (a) the fair market value of the common shares,
as of the close of such tax year over (b) such U.S. Holder's tax basis in such
common shares. A U.S. Holder that makes a Mark-to-Market Election will be
allowed a deduction in an amount equal to the excess, if any, of (a) such U.S.
Holder's adjusted tax basis in the common shares, over (b) the fair market value
of such common shares (but only to the extent of the net amount of previously
included income as a result of the Mark-to-Market Election for prior tax years).

A U.S. Holder that makes a Mark-to-Market Election generally
also will adjust such U.S. Holder's tax basis in the common shares to reflect
the amount included in gross income or allowed as a deduction because of such
Mark-to-Market Election. In addition, upon a sale or other taxable disposition
of common shares, a U.S. Holder that makes a Mark-to-Market Election will
recognize ordinary income or ordinary loss (not to exceed the excess, if any, of
(a) the amount included in ordinary income because of such Mark-to-Market
Election for prior tax years over (b) the amount allowed as a deduction because
of such Mark-to-Market Election for prior tax years). Losses that exceed this
limitation are subject to the rules generally applicable to losses provided in
the Code and Treasury Regulations.

A Mark-to-Market Election applies to the tax year in which such
Mark-to-Market Election is made and to each subsequent tax year, unless the
common shares cease to be "marketable stock" or the IRS consents to revocation
of such election. Each U.S. Holder should consult its own tax advisor regarding
the availability of, and procedure for making, a Mark-to-Market Election.

Although a U.S. Holder may be eligible to make a Mark-to-Market
Election with respect to the common shares, no such election may be made with
respect to the stock of any Subsidiary PFIC that a U.S. Holder is treated as
owning, because such stock is not marketable. Hence, the Mark-to-Market Election
will not be effective to eliminate the application of the default rules of
Section 1291 of the Code described above with respect to deemed dispositions of
Subsidiary PFIC stock or excess distributions from a Subsidiary PFIC.

Other PFIC Rules

Under Section 1291(f) of the Code, the IRS has issued proposed
Treasury Regulations that, subject to certain exceptions, would cause a U.S.
Holder that had not made a timely QEF Election to recognize gain (but not loss)
upon certain transfers of common shares that would otherwise be tax-deferred
(e.g., gifts and exchanges pursuant to corporate reorganizations). However, the
specific U.S. federal income tax consequences to a U.S. Holder may vary based on
the manner in which common shares are transferred.

Certain additional adverse
  rules may apply with respect to a U.S. Holder if the Company is a PFIC,
  regardless of whether such U.S. Holder makes a QEF Election. For example, under
  Section 1298(b)(6) of the Code, a U.S. Holder that uses common shares as
  security for a loan will, except as may be provided in Treasury Regulations, be
  treated as having made a taxable disposition of such common shares.

Special rules also apply to the amount of foreign tax credit
that a U.S. Holder may claim on a distribution from a PFIC. Subject to such
special rules, foreign taxes paid with respect to any distribution in respect of
stock in a PFIC are generally eligible for the foreign tax credit. The rules
relating to distributions by a PFIC and their eligibility for the foreign tax
credit are complicated, and a U.S. Holder should consult with its own tax
advisor regarding the availability of the foreign tax credit with respect to
distributions by a PFIC.

The PFIC rules are complex, and each U.S. Holder should
  consult its own tax advisor regarding the PFIC rules and how the PFIC rules may
  affect the U.S. federal income tax consequences of the acquisition, ownership,
  and disposition of common shares.

Ownership and Disposition of Common Shares

The following discussion is subject to the rules described
above under the heading "Passive Foreign Investment Company Rules."

Distributions on Common Shares

A U.S. Holder that receives a distribution, including a
constructive distribution, with respect to a common share will be required to
include the amount of such distribution in gross income as a dividend (without
reduction for any Canadian income tax withheld from such distribution) to the
extent of the current or accumulated "earnings and profits" of the Company, as
computed for U.S. federal income tax purposes. A dividend generally will be
taxed to a U.S. Holder at ordinary income tax rates if the Company is a PFIC. To
the extent that a distribution exceeds the current and accumulated "earnings and
profits" of the Company, such distribution will be treated first as a tax-free
return of capital to the extent of a U.S. Holder's tax basis in the common
shares and thereafter as gain from the sale or exchange of such common shares.
(See " Sale or Other Taxable Disposition of common shares" below). However, the
Company may not maintain the calculations of earnings and profits in accordance
with U.S. federal income tax principles, and each U.S. Holder should therefore
assume that any distribution by the Company with respect to the common shares
will constitute ordinary dividend income. Dividends received on common shares
generally will not be eligible for the "dividends received deduction". In
addition, the Company does not anticipate that its distributions will constitute
qualified dividend income eligible for the preferential tax rates applicable to
long-term capital gains. The dividend rules are complex, and each U.S. Holder
should consult its own tax advisor regarding the application of such rules.

55

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Sale or Other Taxable Disposition of Common Shares

Upon the sale or other taxable disposition of common shares, a
U.S. Holder generally will recognize capital gain or loss in an amount equal to
the difference between the U.S. Dollar value of cash received plus the fair
market value of any property received and such U.S. Holder's tax basis in such
common shares sold or otherwise disposed of. A U.S. Holder's tax basis in common
shares generally will be such holder's U.S. Dollar cost for such common shares.
Gain or loss recognized on such sale or other disposition generally will be
long-term capital gain or loss if, at the time of the sale or other disposition,
the common shares have been held for more than one year.

Preferential tax rates currently apply to long-term capital
gain of a U.S. Holder that is an individual, estate, or trust. There are
currently no preferential tax rates for long-term capital gain of a U.S. Holder
that is a corporation. Deductions for capital losses are subject to significant
limitations under the Code.

Additional Tax on Passive Income

For tax years beginning after December 31, 2012, certain
individuals, estates and trusts whose income exceeds certain thresholds will be
required to pay a 3.8% Medicare surtax on "net investment income" including,
among other things, dividends and net gain from dispositions of property (other
than property held in a trade or business). U.S. Holders should consult with
their own tax advisors regarding the effect, if any, of this tax on their
ownership and disposition of common shares.

Receipt of Foreign Currency

The amount of any distribution paid to a U.S. Holder in foreign
currency, or on the sale, exchange or other taxable disposition of common
shares, generally will be equal to the U.S. Dollar value of such foreign
currency based on the exchange rate applicable on the date of receipt
(regardless of whether such foreign currency is converted into U.S. Dollars at
that time). A U.S. Holder will have a basis in the foreign currency equal to its
U.S. Dollar value on the date of receipt. Any U.S. Holder who converts or
otherwise disposes of the foreign currency after the date of receipt may have a
foreign currency exchange gain or loss that would be treated as ordinary income
or loss, and generally will be U.S. source income or loss for foreign tax credit
purposes. Each U.S. Holder should consult its own U.S. tax advisor regarding the
U.S. federal income tax consequences of receiving, owning, and disposing of
foreign currency.

Foreign Tax Credit

Subject to the PFIC rules discussed above, a U.S. Holder that
pays (whether directly or through withholding) Canadian income tax with respect
to dividends paid on the common shares generally will be entitled, at the
election of such U.S. Holder, to receive either a deduction or a credit for such
Canadian income tax. Generally, a credit will reduce a U.S. Holder's U.S.
federal income tax liability on a Dollar-for-Dollar basis, whereas a deduction
will reduce a U.S. Holder's income subject to U.S. federal income tax. This
election is made on a year-by-year basis and applies to all foreign taxes paid
(whether directly or through withholding) by a U.S. Holder during a year.

Complex limitations apply to the foreign tax credit, including
the general limitation that the credit cannot exceed the proportionate share of
a U.S. Holder's U.S. federal income tax liability that such U.S. Holder's
"foreign source" taxable income bears to such U.S. Holder's worldwide taxable
income. In applying this limitation, a U.S. Holder's various items of income and
deduction must be classified, under complex rules, as either "foreign source" or
"U.S. source." Generally, dividends paid by a foreign corporation should be
treated as foreign source for this purpose, and gains recognized on the sale of
stock of a foreign corporation by a U.S. Holder should be treated as U.S. source
for this purpose, except as otherwise provided in an applicable income tax
treaty, and if an election is properly made under the Code. However, the amount
of a distribution with respect to the common shares that is treated as a
"dividend" may be lower for U.S. federal income tax purposes than it is for
Canadian federal income tax purposes, resulting in a reduced foreign tax credit
allowance to a U.S. Holder. In addition, this limitation is calculated
separately with respect to specific categories of income. The foreign tax credit
rules are complex, and each U.S. Holder should consult its own U.S. tax advisor
regarding the foreign tax credit rules.

56

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Backup Withholding and Information Reporting

Under U.S. federal income tax law and Treasury Regulations,
certain categories of U.S. Holders must file information returns with respect to
their investment in, or involvement in, a foreign corporation. For example,
recently enacted legislation generally imposes new U.S. return disclosure
obligations (and related penalties) on individuals who are U.S. Holders that
hold certain specified foreign financial assets in excess of $50,000. The
definition of specified foreign financial assets includes not only financial
accounts maintained in foreign financial institutions, but also, unless held in
accounts maintained by a financial institution, any stock or security issued by
a non-U.S. person, any financial instrument or contract held for investment that
has an issuer or counterparty other than a U.S. person and any interest in a
foreign entity. U.S. Holders may be subject to these reporting requirements
unless their common shares are held in an account at a domestic financial
institution. Penalties for failure to file certain of these information returns
are substantial. U.S. Holders should consult with their own tax advisors
regarding the requirements of filing information returns, including the
requirement to file an IRS Form 8938.

Payments made within the U.S. or by a U.S. payor or U.S.
middleman, of dividends on, and proceeds arising from the sale or other taxable
disposition of, common shares will generally be subject to information reporting
and backup withholding tax, at the rate of 28% (and increasing to 31% for
payments made after December 31, 2012), if a U.S. Holder (a) fails to furnish
such U.S. Holder's correct U.S. taxpayer identification number (generally on
Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c)
is notified by the IRS that such U.S. Holder has previously failed to properly
report items subject to backup withholding tax, or (d) fails to certify, under
penalty of perjury, that such U.S. Holder has furnished its correct U.S.
taxpayer identification number and that the IRS has not notified such U.S.
Holder that it is subject to backup withholding tax. However, certain exempt
persons generally are excluded from these information reporting and backup
withholding rules. Backup withholding is not an additional tax. Any amounts
withheld under the U.S. backup withholding tax rules will be allowed as a credit
against a U.S. Holder's U.S. federal income tax liability, if any, or will be
refunded, if such U.S. Holder furnishes required information to the IRS in a
timely manner. Each U.S. Holder should consult its own tax advisor regarding the
information reporting and backup withholding rules.

|F. | DIVIDENDS AND PAYING
AGENTS
|-- | ---------------------------

Not applicable.

|G. | STATEMENT BY EXPERTS
|-- | --------------------

Not applicable.

|H. | DOCUMENTS ON DISPLAY
|-- | --------------------

Exhibits attached to this Form 20-F are also available for
viewing on EDGAR at http://www.sec.gov/, or at the offices of the
Company, 15th Floor - 1040 West Georgia Street, Vancouver, British Columbia V6E
4H1 or on request of the Company at 604-684-6365, attention: Investor Relations
Department. Copies of the Company's IFRS financial statements and other
continuous disclosure documents required under the British Columbia Securities
Act are available for viewing on the internet at www.sedar.com.

|I. | SUBSIDIARY INFORMATION
|-- | ----------------------

Not applicable.

57

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|ITEM 11 | QUANTITATIVE AND
      QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|------- | ----------------------------------------------------------------

|A. | TRANSACTION RISK AND CURRENCY RISK
    MANAGEMENT
|-- | -------------------------------------------------

The Company is exposed in varying degrees to a variety of
financial instrument related risks. The Board approves and monitors the risk
management processes, inclusive of documented treasury policies, counterparty
limits, and controlling and reporting structures.

|B. | EXCHANGE RATE SENSITIVITY
|-- | -------------------------

The Company incurs substantially all of its expenditures in
Canada and substantially all of its cash and cash equivalents held are
denominated in Canadian dollars. Consequently the Company is not subject to
material foreign exchange risk.

|C. | INTEREST RATE RISK AND EQUITY PRICE
  RISK
|-- | ------------------------------------------

The Company is subject to interest rate risk with respect to
its investments in cash and cash equivalents. The Company's policy is to invest
cash at fixed rates of interest and cash reserves are to be maintained in cash
and cash equivalents in order to maintain liquidity, while achieving a
satisfactory return for shareholders. Fluctuations in interest rates when the
cash and cash equivalents mature impact interest income earned.

|D. | COMMODITY PRICE RISK
|-- | --------------------

While the value of the Company's resource properties, if any,
can always be said to relate to the price of precious metals and the outlook for
same, the Company does not have any resource properties or operating mines and
hence does not have any hedging or other commodity based operational risks
respecting to its business activities.

|ITEM 12 | DESCRIPTION OF
      SECURITIES OTHER THAN EQUITY SECURITIES
|------- | ------------------------------------------------------------

Not applicable.

|ITEM 13 | DEFAULTS, DIVIDEND
      ARREARAGES AND DELINQUENCIES
|------- | -----------------------------------------------------

Not applicable.

|ITEM 14 | MATERIAL MODIFICATIONS
      TO THE RIGHTS OF SECURITY HOLDERS AND USE **OF PROCEEDS**
|------- | --------------------------------------------------------------------------------------

Not applicable.

|ITEM 15 | CONTROLS AND
      PROCEDURES
|------- | -----------------------------

|A. | DISCLOSURE CONTROLS AND
  PROCEDURES
|-- | ------------------------------------

At the end of the period covered by this annual report on Form
20-F, an evaluation was carried out with the participation of the Company's
management, including the President and Chief Executive Officer ("CEO") and the
Chief Financial Officer ("CFO"), of the effectiveness of the Company's
disclosure controls and procedures (as defined in Rules 13a  15(e) and 15d
15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")). Based on that evaluation, the President and CEO and the CFO have
concluded that as of the end of the period covered by this annual report on Form
20-F, the Company's disclosure controls and procedures were effective in
providing reasonable assurance that: (i) information required to be disclosed by
the Company in reports that it files or submits to the SEC under the Exchange
Act was recorded, processed, summarized and reported within the time periods
specified in applicable rules and forms, and (ii) material information required
to be disclosed in the Company's reports filed under the Exchange Act was
accumulated and communicated to the Company's management, including the
President and CEO and the CFO, as appropriate, to allow for accurate and timely
decisions regarding required disclosure.

58

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|B. | MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER
      FINANCIAL REPORTING
|-- | -----------------------------------------------------------------------------

The Company's management, including the President and CEO and
CFO, is responsible for establishing and maintaining adequate internal control
over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act. The Company's internal control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation and fair presentation of financial
statements for external purposes in accordance with IFRS. The Company's internal
control over financial reporting includes those policies and procedures
that:

| |  | pertain to the maintenance of records that, in reasonable
      detail, accurately and fairly reflect the transactions and dispositions of
      the assets of the Company;                                                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | provide reasonable assurance that transactions are
      recorded as necessary to permit preparation of financial statements in
      accordance with IFRS, and that receipts and expenditures of the Company
      are being made only in accordance with authorizations of management and
      directors of the Company; and
| |  | provide reasonable assurance regarding prevention or
      timely detection of unauthorized acquisition, use or disposition of the
      Company's assets that could have a material effect on the financial
      statements.                                                                                                 

With the participation of the President and CEO and CFO,
management conducted an evaluation of the design and operation of the Company's
internal control over financial reporting as of July 31, 2015, based on the
criteria set forth in Internal Control-Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission. This
evaluation included review of the documentation of controls, evaluation of the
design effectiveness of controls, testing of the operating effectiveness of
controls and a conclusion on this evaluation. Based on this evaluation,
management concluded in its report that the Company's internal control over
financial reporting was effective as of July 31, 2015.

This annual report does not include an attestation report of
the Company's registered public accounting firm regarding internal control over
financial reporting. Management's report was not subject to attestation by the
Company's registered public accounting firm pursuant to rules that permit the
Company to provide only management's report in this annual report.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the period covered by this Annual Report on Form 20-F,
no changes occurred in the Company's internal control over financial reporting
that have materially affected, or are reasonably likely to materially affect,
the Company's internal control over financial reporting.

LIMITATIONS OF CONTROLS AND PROCEDURES

The Company's management, including its President and CEO and
CFO, does not expect that its disclosure controls and procedures or internal
controls and procedures will prevent all errors and all fraud. A control system,
no matter how well conceived and operated, can provide only reasonable, not
absolute, assurance that the objectives of the control system are met. Further,
the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within the Company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
controls. The design of any system of controls is also based in part upon
certain assumptions about the likelihood of future events, and there can be no
assurance that any design will succeed in achieving its stated goals under all
potential future conditions; over time, controls may become inadequate because
of changes in conditions, or the degree of compliance with the policies or
procedures may deteriorate. Because of the inherent limitations in a
cost-effective control system, misstatements due to error or fraud may occur and
not be detected.

59

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|ITEM 16 | [RESERVED]
|------- | ----------

|ITEM 16A | AUDIT COMMITTEE
      FINANCIAL EXPERT
|-------- | --------------------------------------

The members of the Audit and Risk Committee are James Kerr,
David Mordant and Gordon J. Fretwell. The Board of Directors has determined that
Mr. Kerr qualifies as a "financial expert" under the rules of the Securities and
Exchange Commission, based on his education and experience. Messrs. Kerr,
Mordant and Fretwell are "independent", as that term is defined in section 803
of the NYSE MKT Company Guide. Mr. Kerr is an accredited Chartered Professional
Accountant in Canada.

Each Audit and Risk Committee member is able to read and
understand fundamental financial statements.

|ITEM 16B | CODE OF ETHICS
|-------- | --------------

The Company's board of directors has adopted a written Code of
Ethics governing directors, officers and employees. The Code of Ethics sets
forth written standards that are designed to deter wrongdoing and to meet the
Company's core vision: to become a successful and innovative mining and mineral
exploration corporation.

In order to achieve the Company's vision the following values
are to be included in all activities:

| |  | Responsibly explore for and develop mineral
      resources;                                            
| | - | --------------------------------------------------------------------------------------------------------
| |  | Be respectful of the environment;                                                                       
| |  | Be an industry leader and participate in
      industry organizations devoted to improving the industry;
| |  | Be a strong and honest competitor;                                                                      
| |  | Be a responsible corporate citizen and
      contribute to the community;                               
| |  | Deal fairly with our customers, suppliers and
      joint venture participants;                         
| |  | Provide a safe and rewarding work environment;
      and                                                
| |  | Deliver value to shareholders.                                                                          

The board of directors monitors compliance with the Code of
Ethics by ensuring that all Company personnel have read and understood the Code
of Ethics, and by charging management with bringing to the attention of the
board of directors any issues that arise with respect to the Code of Ethics.

A copy of the Code of Ethics was filed with the Securities and
Exchange Commission as an exhibit to the Company's Annual Report filed on Form
20-F for the fiscal year ended July 31, 2012 and is available at
www.sec.gov. The Company will also provide a copy of the Code of Ethics
to any person without charge, upon request. Requests can be sent by mail to:
15th Floor, 1040 West Georgia Street, Vancouver, British Columbia, Canada, V6E
4H8; or submitted by telephone at 604-684-6365, attention: Investor Relations
Department.

During the most recently completed fiscal year, the Company has
neither: (a) amended its Code of Ethics; nor (b) granted any waiver (including
any implicit waiver) form any provision of its Code of Ethics.

60

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|ITEM 16C | PRINCIPAL ACCOUNTANT
      FEES AND SERVICES
|-------- | --------------------------------------------

The following table discloses the aggregate fees billed for
each of the last two fiscal years for professional services rendered by the
Company's audit firm, Davidson & Company LLP for various services.

Services:
    Year endedJuly 31, 2015
    July 31, 2014Audit Fees
      (1)
    $
      26,500
    $
      26,500Audit Related Fees
      (2)
    
    Tax Fees
      (3)
    
    All Other Fees
      (4)
    
    Total
    $
      26,500
    $
      26,500


|Notes:
|------
|      
|(1)   
|      
|(2)   
|      
|(3)   
|      
|(4)   

From time to time, management of the Company recommends to and
requests approval from the Audit and Risk Committee for non-audit services to be
provided by the Company's auditors. The Audit and Risk Committee routinely
considers such requests at committee meetings, and if acceptable to a majority
of the Audit and Risk Committee members, pre-approves such non-audit services by
a resolution authorizing management to engage the Company's auditors for such
non-audit services, with set maximum dollar amounts for each itemized service.
During such deliberations, the Audit and Risk Committee assesses, among other
factors, whether the services requested would be considered "prohibited
services" as contemplated by the SEC, and whether the services requested and the
fees related to such services could impair the independence of the auditors. No
material non-audit services were provided by the Company's auditors during the
year ended July 31, 2015.

|ITEM 16D | EXEMPTIONS FROM LISTING
      STANDARDS FOR AUDIT COMMITTEES
|-------- | ------------------------------------------------------------

Not applicable.

|ITEM 16E | PURCHASES OF EQUITY
      SECURITIES BY THE ISSUER AND AFFILIATED **PURCHASERS**
|-------- | --------------------------------------------------------------------------------

During the year ended July 31, 2015, the Company did not
purchase any of its issued and outstanding common shares pursuant to any
repurchase program or otherwise.

|ITEM 16F | CHANGE IN REGISTRANT'S
      CERTIFYING ACCOUNTANT
|-------- | --------------------------------------------------

None.

61

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|ITEM 16G | CORPORATE GOVERNANCE
|-------- | --------------------

Not applicable.

|ITEM 16H | MINE SAFETY
      DISCLOSURE
|-------- | ----------------------------

Not applicable.

|ITEM 17 | FINANCIAL STATEMENTS
|------- | --------------------

Not applicable. See Item 18.

|ITEM 18 | FINANCIAL STATEMENTS
|------- | --------------------

See Exhibit 99.1.

|ITEM 19 | EXHIBITS
|------- | --------

The following Exhibits have been filed with the Company's
Annual Report on Form 20-F in previous years:

Exhibit Number
    Description of Exhibit
    Note1.1
    Transition Application dated October 11, 2005
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2005, filed on January 10, 2006.1.2
    Notice of Articles dated October 11, 2005
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2005, filed on January 10, 2006.1.3
    Notice of Alteration of Articles dated October 11, 2005
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2005, filed on January 10, 2006.1.4
    Notice of Alteration dated February 17, 2006
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2006, filed on January 29, 2007.1.5
    Notice of Articles dated February 17, 2006
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2006, filed on January 29, 2007.1.7
    Articles, as amended the Companys Annual General
      Meeting, held on February 24, 2014.
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2014, filed on October 17, 2014.4.2
    Services Agreement between Hunter Dickinson Inc. and the
      Company dated July 2, 2010
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2010, filed on October 28, 2010.4.1
    Sale Agreement between Finsbury Exploration Ltd. and the
      Company dated July 27, 2012
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.


62

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Exhibit Number
    Description of Exhibit
    Note4.3
    Convertible Debenture Agreement between Bearclaw Capital
      Corp. and the Company dated August 20, 2012, and amended July 14, 2013.
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.4.4
    Letter Agreement between Amarc Resources Ltd. and the
      Company, dated November 1, 2012
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.4.5
    Amended Letter Agreement between Amarc Resources Ltd. and
      the Company, dated June 27, 2013
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2013, filed on November 28, 2013.4.6
    Amendment dated July 14, 2013 to Convertible Debenture
      Agreement between Bearclaw Capital Corp. and the Company dated August 20,
      2012.
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2014, filed on October 17, 2014.4.7
    Amendment dated October 8, 2014 to Convertible Debenture
      Agreement between Bearclaw Capital Corp. and the Company dated August 20,
      2012.
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2014, filed on October 17, 2014.6.1
    Stock Option Plan approved by Shareholders on March 15,
      2012
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.6.2
    Audit and Risk Committee Charter
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.10.1
    Articles approved by Shareholders on March 15, 2012
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.16B.
    Code of Ethics and Trading Restrictions
    Incorporated by reference from our Annual Report on Form
      20-F for the year ended July 31, 2012, filed on November 30, 2012.


The following exhibits are filed with this Annual Report on
Form 20-F:

Exhibit 
      Number
    Description of Exhibit12.1
    Section 302 Certification of the Chief Executive Officer12.2
    Section 302 Certification of the Chief Financial Officer13.1
    Section 906 Certification of the Chief Executive Officer13.2
    Section 906 Certification of the Chief Financial Officer


63

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Exhibit 
      Number
    Description of
      Exhibit99.1
    Independent Auditors Report, dated November 25, 2015;
      Statements of financial position as at July 31, 2015, and July 31,
      2014;
      Statements of comprehensive loss for the years ended July 31, 2015,
      July 31, 2014 and July 31, 2013;
      Statements of cash flows for the years ended July 31, 2015, July 31,
      2014 and July 31, 2013; and
      Statements of changes in equity for the years ended July 31, 2015, July
      31, 2014 and July 31, 2013;
  Notes to audited annual financial statements


SIGNATURES

The registrant hereby certifies that it meets all of the
requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this Annual Report on its behalf.

QUARTZ MOUNTAIN RESOURCES LTD.

|/s/ Ronald W. Thiessen                | 
|------------------------------------- | 
|Ronald W. Thiessen                    | 
|President and Chief Executive Officer | 
|Dated: November 25, 2015              | 

64

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