Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

​

materially from those anticipated, believed, estimated or expected. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Except as required by law, we disclaim any obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

​

General

​

The following discussion should be read in conjunction with our financial statements. In addition to historical information, this discussion contains forward- looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management's expectations. We are not undertaking any obligation to update any forward-looking statements or other statements we may make in the following discussion or elsewhere in this document even though these statements may be affected by events or circumstances occurring after the forward- looking statements or other statements were made. Therefore, no reader of this document should rely on these statements being current as of any time other than the date of this MD&A.

Our Business

We were incorporated in the province of British Columbia on April 8, 2020 under the name 1246779 B.C. LTD. In November 2021, 1246779 B.C. LTD completed a business combination with Alaska Silver USA Corp, an Alaska corporation ("ASUSA" and formerly "Western Alaska Copper and Gold Company"), with ASUSA remaining as our wholly-owned subsidiary. On April 25, 2025, we changed our name to Alaska Silver Corp. We are a Canadian public company whose common shares are listed for trading on the TSX Venture Exchange ("TSXV") under the symbol "WAM" and quoted on the OTCQX Exchange under the symbol "WAMFF". Our principal executive office is located at 1600 - 1021 West Hastings St, Vancouver, British Columbia, V6E 0C3 Canada.

We have no operating revenue and support our operations through the sale of our equity. The value of any of our mineral properties is dependent upon the existence or potential existence of economically recoverable mineral reserves.

We have one directly held wholly-owned subsidiary, ASUSA, and one indirectly held, wholly-owned subsidiary, Piek Incorporated.

All financial information in this MD&A of Financial Condition and Results of Operations, for current and past years, was accounted for under US GAAP.

Since 2010, we, operating through ASUSA and Alaska Silver Corp, have been exploring and advancing interests in the Illinois Creek mining district that includes gold, silver, copper, gallium, lead and zinc exploration targets in western Alaska east of the Yukon River.

We have adopted the mining disclosure standards of Subpart 1300 of Regulation S-K, or "S-K 1300"). We are subject to and required to disclose mineral resources and mineral reserves in accordance with S-K 1300. While the S-K 1300 rules are similar to National Instrument 43-101 rules in Canada, they are not identical and therefore two reports have been produced for the Illinois Creek Project. The disclosure in this quarterly report on Form 10-Q is related to the Illinois Creek Project is based on the S-K 1300 technical report summary entitled "S-K 1300 Technical Report Summary, Illinois Creek Project, Western Alaska, USA", with an effective date of January 22, 2026 and a signature date of March 9, 2026.

Illinois Creek Project, Alaska: Claim Consolidation

On October 17, 2018, ASUSA and one of its shareholders, Joe Piekenbrock, entered into the Operating Agreement of Illinois Creek Joint Venture LLC (the "JV Operating Agreement"), which formed the Illinois Creek Joint Venture LLC. Pursuant to the JV Operating Agreement, ASUSA issued 346 ASUSA common shares valued at $692,000 to Mr. Piekenbrock. On March 31, 2021, the members of the Illinois Creek Joint Venture LLC, agreed to terminate and dissolve the Illinois Creek Joint Venture LLC, and dissolve it, as directed by the Action of Unanimous Written Consent of the members of the Illinois Creek Joint Venture LLC, effective as of March 31, 2021. On March 31, 2021, ASUSA and Mr. Piekenbrock entered into a Stock Purchase Agreement, whereby ASUSA acquired 100% of the issued and outstanding common shares of an Alaska private company, Piek Incorporated ("Piek"), in exchange for 120 ASUSA common shares (valued at $540,000) and $3,698,000 payable by the issuance of a promissory note to Mr. Piekenbrock. Piek is the sole owner of 40 state mineral claims, known as the Illinois Creek Project, located in the Mount McKinley mining district of Alaska. Seventy (70) other Piek claims totaling approximately 11,135 acres were converted to a State of Alaska Uplands Mine Lease in July, 2024. An additional 86 claims were staked by ASUSA in 2021, after the acquisition of Piek, and 115 new claims were staked by ASUSA in 2022. An additional 46 claims were staked by ASUSA in 2025.

​

The total land package is 33,385 hectares (82,495 acres) and includes: 287 Illinois Creek Claims, 19 Khotol Claims, 18 Paw Print Claims, 24 Honker Claims, 112 Round Top Claims, and 11,135 acres converted to Uplands Mining Lease.

Illinois Creek/Waterpump Creek Property, Alaska

Our most advanced stage asset is the Illinois Creek oxide gold-silver project, a past-producing run of mine (ROM) heap leach mine that operated between 1997 and 2002. The Illinois Creek in-situ resource was updated in January 2026. The Indicated Mineral Resource Estimate is 9.0 Mt at 0.92 g/t gold and 29.72 g/t silver containing 260,000 ounces of gold and 8.3 million ounces of silver. The Inferred Mineral Resource Estimate is 10.9 Mt at 0.84 g/t gold and 30.1 g/t silver containing 290,000 ounces of gold and 10.4 million ounces of silver. The indicated and inferred mineral resources at Illinois Creek are based on an open-pit shell assuming metals prices of US $3,500/oz gold and US $45/oz silver. The mineralization within the Illinois Creek deposit is oxide material which is amenable to heap leach extraction and processing. The oxide mineralization remains open along strike and at depth.

The Illinois Creek project includes a modern, fully operational camp and 4,400-foot airstrip.

Our Waterpump Creek property is located within the Illinois Creek project. An exceptional high-grade silver-lead-zinc re-discovery was made in 2021, when we drill tested historically recognized sulfide carbonate replacement deposit ("CRD") mineralization at depth. Drill hole WPC21-09 cut 10.5-meters (9.1 meters true thickness) of 522 g/t silver, 22.5% zinc and 14.4% lead of massive intergrown sphalerite and argentiferous galena down-dip of the historical drilling. This exceptional high-grade interval turned the focus on targeting the overall CRD potential on the property. An initial resource estimate was released on February 22, 2024. The (2.4Mt) initial resource reveals an inferred 980 g/t AgEq for 74.9Moz AgEq hosting high-grade silver & zinc.

Numerous other exploration prospects and targets exist within the Illinois Creek - Waterpump Creek CRD system, such as Warm Springs and the newly discovered Silver Sage zone. The district is underpinned by mineral resource estimates at both the Illinois Creek deposit and the Waterpump Creek deposit, but there are still many exploration opportunities and targets in the surrounding area.

Honker Property, Alaska

The Honker Property is a gold-silver (Au-Ag) low sulfidation vein system discovered in 1981 located approximately six miles north of the Illinois Creek Mine. It consists of 24 state mineral claims, owned 100% by ASUSA, located in the Mount McKinley recording district of Alaska. The Honker vein strikes up to 1,000m in length and varies from 1 to 7 meters in width. Numerous grab, channel, and bulk samples returned assays >34 g/t Au from the historic trenching and surface sampling. Numerous historic and more recent (2021) drill programs intercepted the Honker vein. Some highlights include: HK21-06 intercepted a 7.6-meter vein with numerous 1+ meter splays grading from 3 to 5 g/t Au. HK-4 intercepted 1.6 meters of 8.68 g/t Au including 0.2 meters of 38.39 g/t Au. Honker could provide high-grade feed to a combined processing operation at Illinois Creek.

Round Top Property, Alaska

The Round Top property, located 15.5 miles NE of the Illinois Creek project, is a large copper-molybdenum-silver (Cu-Mo-Ag) porphyry system that includes both high grade copper surface discoveries and drill intercepts to a depth of 800 meters. Cu-Mo-Ag mineralization is associated with Cretaceous (+/- 72 Ma) age intrusive rocks. The property consists of 88 state mineral claims, owned 100% by ASUSA, located in the Mount McKinley and Nulato recording districts of Alaska.

The TG and TG North prospects lie just to the northwest of the Round Top porphyry and are Ag-Pb-Zn CRD targets demonstrated by a 5km by 2 km Ag-Pb-Zn soil anomaly in the permissive carbonate host rocks proximal to a known intrusive source.

Khotol and Paw Print, Alaska

Khotol and Paw Print are the early exploration stage properties we staked in 2022. There are 19 claims for Khotol with 3 additional claims staked in 2024 and 18 claims for Paw Print. Khotol is located directly northwest of the Illinois Creek Property. Paw Print is located approximately 25 miles northeast of the Illinois Creek mine. During the period ended September 30, 2026 the Paw Print claims were not renewed.

​

The Khotol Claim Block contains three main prospects: Khotol Ridge gossan, Colorado Creek gossan, and Sunny Day gossan. The Khotol Ridge prospect is the most prospective gossan on these claims and is a Ag-Pb-Zn gossan hosted in metasedimentary rocks similar to Illinois Creek. The Sunny Day gossan mineralization is weakly anomalous in Cu, Pb, Ag, and As and consists of scattered limonitic quartzite breccia and minor massive vuggy gossan float in a dry east-west trending gully coincident with a pronounced linear feature (Brewer and Millholland, 1982). The Colorado Creek gossan is a weakly anomalous Ag-Pb-Zn-Cu gossan consisting of quartz breccias and vuggy oxidized gossanous float.

The Paw Print prospect consists of silt and soil anomalies associated with iron seeps along a northeast trending ~4km long linear feature. The seeps and iron-stained streams drain the inferred contact between the graphitic schistose quartzite and the younger unmetamorphosed mafic volcanics and intrusive (JMI Greenstone) (Flanigan, 1994). There seems to be a correlation of the mineralized seeps with the contact between the mafic volcanics and the schistose quartzites (Flanigan, 1994).

Other Corporate Matters

Subordinate Voting and Proportionate Voting Shares

In connection with a reverse takeover transaction in 2021, we created a dual share structure with subordinate voting shares and proportionate voting shares. The subordinate voting shares are listed for trading on the TSXV. The proportionate voting shares are, in effect, subordinate voting shares compressed at the ratio of 100:1 which have voting and economic rights on an as-converted basis. Each proportionate voting share is convertible into 100 subordinate voting shares. The proportionate voting shares are convertible to subordinate voting shares at the request of the shareholder. On March 9, 2026, we converted all of the proportionate voting shares to subordinate voting shares. On May 7, 2026, we eliminated the class of Proportionate Shares as an authorized class of shares and renamed the Subordinate Voting Shares of the Company to "Common Shares".

Operations

Our 2026 drilling program was expanded from approximately 6,000 metres to approximately 9,496 metres following the Private Placement. The 9,496 metre drill program was executed over 84 drill days, ahead of the original 90-day, 6,000-metre plan with 2 drill rigs in operation. The drill performance involved a combined average drill rate of 112.9 metres per day (56.5 metres per rig per day), exceeding the planned rate of 45 metres per rig per day by more than 25%. Additionally, the deepest hole ever drilled at Illinois Creek, reaching a total depth of 1,288.24 metres was drilled during the season. This season also involved zero lost-time incidents, zero reportable safety incidents, and zero rig downtime for the entirety of the season.

In total, 39 drill holes were drilled and sampled during the 2026 field season; 27 at the Silver Sage zone and 12 at the Waterpump Creek zone. All logging, core cutting, and sampling was completed on September 12, 2026. Final shipment of samples was sent out from camp on September 23, 2026. The program generated a total of 7,380 samples weighing approximately 55,900 lbs (25.3 tonnes), including the drill core, soil, trench, and environmental samples collected during the season. These were shipped to ALS Global for sample preparation in Mexico and Las Vegas, followed by analysis in Reno and Vancouver. All assay results are anticipated by the year end.

During the 2026 field season, company geologists collected more than 2,000 lbs of material along a 200-metre section of the Illinois Creek past-producing mine main pit for metallurgical testing. This sample was designed to represent the resource as a whole and the metallurgical testing will help determine how much silver, gold, and copper can be recovered from the sampled material and what processing method would work best. Recovery rates have a direct effect on a project's potential economics, and this testing will provide important information toward a possible Preliminary Economic Assessment (PEA). This large bulk sample is destined for Kappes, Cassiday & Associates (KCA), an independent metallurgical laboratory in Reno, Nevada. KCA will design a processing approach that recovers copper while maximizing silver and gold recoveries. Separately, a series of smaller samples was sent to ALS to build a modern, detailed chemical profile of the deposit. This will support both metallurgical work and future exploration. Together, these results will provide key inputs for evaluating the Illinois Creek Mine's development potential. Results are pending.

Competition in the mineral exploration industry is intense. We compete with other mining companies, many of which have greater financial resources and technical facilities for the acquisition and development of mineral concessions, claims, leases and other interests, as well as for the recruitment and retention of qualified employees and consultants. The mining business is subject to mineral price and investment climate cycles. The marketability of minerals is also affected by worldwide economic and demand cycles. In recent years, the significant demand for minerals in some countries has driven increased commodity prices. It is difficult to assess if the current commodity prices are long-term trends, and there is uncertainty as to the recovery, or otherwise, of the world economy. If the global

​

conditions weaken and commodity prices decline as a consequence, a continuing period of lower prices could significantly affect the economic potential of each of the Illinois Creek Project and the Other Properties.

Mining is an extractive industry that impacts the environment. Our goal is to regularly evaluate ways to minimize such impact. We expect to meet or exceed environmental standards at each of the Properties (including the Illinois Creek Project) and to continue this approach through effective engagement with affected stakeholders, including local communities, government and regulatory agencies and indigenous groups.

We are currently active only in Alaska, which has established environmental standards and regulations that we strive to exceed. Our environmental performance is overseen at the board level and environmental performance is our responsibility. We recognize environmental management as a corporate priority and place a strong emphasis on preserving the environment for future generations, while also providing for safe, responsible and profitable operations by developing natural resources for the benefit of our employees, shareholders and communities.

There are no significant elements of the income or loss from continuing operations that do not arise from or are not necessarily representative of the ongoing business.

There have not been any unusual or infrequent events or transactions or significant economic changes that materially affected the amount of income or loss from continuing operations.

RESULTS OF OPERATIONS

Comparison of the Three Months Ended September 30, 2026 and 2025

​

​

The net loss for the three months ended September 30, 2026 was $2,883,990 compared to a net loss of $2,586,127 for the three months ended September 30, 2025. The increase in net loss in 2026 is due higher exploration expenditures offset by a lower gain on the derivative liability revaluation compared to 2025.

Comparison of the Nine Months Ended September 30, 2026 and 2025

​

The net loss for the nine months ended September 30, 2026 was $3,374,696 compared to a net loss of $4,773,977 for the nine months ended September 30, 2025. The decrease in net loss in 2026 is due to increases in exploration and consulting expenses in 2026 offset by the gain on the revaluation of the derivative liability.

​

SUMMARY OF QUARTERLY RESULTS

The following is a summary of the Company's most recent 8 quarterly result:

​

Transaction with Related Parties

The Company's related parties include its subsidiaries, key management personnel, and companies related by way of directors or shareholders in common. Transactions with related parties for goods and services are made on normal commercial terms.

During the nine months ended September 30, 2026, the Company incurred salaries and management fees related to directors and key management of $685,540 (2025 - $623,705).

During the nine months ended September 30, 2026, the Company incurred share-based compensation related to directors and key management of $504,659 (2025 - $209,997).

LIQUIDITY AND CAPITAL RESOURCES

Liquidity risk is the risk that we will encounter difficulty in satisfying financial obligations as they become due. We manage our liquidity risk by forecasting cash flows from operations and anticipated investing and financing activities. Our objective in managing liquidity risk is to maintain sufficient readily available reserves to meet our liquidity requirements.

Sources of Liquidity

We do not have operating revenue to finance our existing obligations and therefore must continue to rely on external financing to generate capital to maintain our capacity to meet working capital requirements. We have relied on debt and equity raises to finance our operating activities since incorporation. We intend to continue to rely on debt and the issuance shares to finance our operations. However, there is a risk that additional financing will not be available on a timely basis or on terms acceptable to us. We do not have any material sources of unused sources of liquid assets. All liquid assets are available for use to finance our operations.

The following table presents our cash, cash equivalents and restricted cash and working capital.

​

Debt Transactions

On March 21, 2025, we completed an unsecured loan transaction with certain lenders (the "Lenders"), pursuant to which we issued promissory notes in the aggregate principal amount of $1,200,000 (the "Loan"). The Loan will mature after 36 months and bear interest at rate of 10% per annum. The Loan will be payable after 12 months. In addition, we also issued to the Lenders an aggregate of 2,697,600

​

bonus warrants. Each bonus warrant entitles the holder to purchase one common share at an exercise price of C$0.64 for a period of 36 months from the date of issuance. Of the $1,200,000, $175,000 was loaned to us by certain of our executive officers and directors, who also received an aggregate of 393,400 warrants. On March 23, 2026, we repaid the promissory note of $1,200,000 with $120,000 interest and recognized a loss of $452,492 on settlement of the promissory note.

Equity Transactions

On October 3, 2025, we completed a brokered initial public offering in the United States through a registration statement on Form S-1, of an aggregate of 21,229,000 Units for gross proceeds of approximately US$13.8 million, and paid cash commission of US$1,034,914 and issued 849,160 underwriters' warrants.

On August 14, 2026, we issued 13,846,910 of our units ("Units") at a price of CAD$0.55 per unit for gross proceeds of CAD$7,615,801 ($5,488,865) in a private placement. Each Unit consists of one common share and one common share purchase warrant ("Warrant"). Each Warrant is exercisable for a common share at CAD$0.75 until August 14, 2029.

On September 30, 2026, we issued 1,509,710 common shares at a price of CAD$0.68 to settle amounts due to related parties of $897,619. A gain of $151,048 was realized on this shares for debt transaction

Cash flows for the nine months ended September 30, 2026

The following table presents a summary of our cash flows for the nine months ended September 30, 2026 and 2025:

​

Working Capital

As of September 30, 2026, we had working capital deficiency of $498,365 (December 31, 2025 - working capital of $1,176,731).

Cash

As of September 30, 2026, we had cash of $4,437,398 (2025 - $569,342).

Cash Used in Operating Activities

Cash used in operating activities during the nine months ended September 30, 2026, was $8,177,061 (2025 - $2,359,965). Cash was mostly spent on exploration, management fees, marketing fees, professional fees and consulting fees, all of which were higher in 2026.

Cash Used in Investing Activities

During the nine months ended September 30, 2026, we spent $515,922 (2025 - $41,222) on equipment and mineral properties acquisition.

Cash (Used in) generated by Financing Activities

During the nine months ended September 30, 2026, we received $4,076,178 (2025 - $2,110,298) in net financing activities, consisting primarily of $5,488,865 in gross proceeds from the August 2026 private placement, partially offset by repayments of promissory notes of $1,619,002 and share issue costs of $233,451.

​

Capital Resources

We have relied mostly on equity financings since inception to meet our capital resource needs. On two occasions, we issued debt in circumstances where equity financing was not available and/or would have been too dilutive. We intend to continue to meet our capital resources needs through equity financings as and when needed.

We do not have any material commitments to make capital expenditures.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Critical Accounting Policies and Estimates

The management's discussion and analysis of the business, financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the consolidated financial statements and expenses incurred during the reporting periods. The estimates are based on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management's judgments and estimates.

Research and Development Activities

We do not incur significant R&D costs. Our major operating costs are costs associated with our exploration activities.

Share Information

The following table summarizes the fully diluted number of common shares outstanding as of September 30, 2026:

​

Going Concern

The recoverability of amounts shown as mineral exploration and evaluation assets is dependent upon the discovery of economically recoverable reserves, our ability to obtain financing to develop the properties and the ultimate realization of profits through future production or sale of the mineral property interests. Realized values may be substantially different than carrying values as recorded in these financial statements.

Our consolidated financial statements have been prepared on a going concern basis, which assumes that we will be able to continue our operation as a going concern for the foreseeable future and will be able to realize our assets and discharge our liabilities in the normal course of business. At September 30, 2026, we had not achieved profitable operations and had an accumulated deficit of $52,739,982

We have no source of revenue, income or cash flow. We are wholly dependent upon raising monies through the sale of our common shares to finance our business operations. There can be no assurances that this capital will be available in amounts or on terms acceptable to us, or at all.

​

Income Taxes

In assessing the probability of realizing income tax assets, management makes estimates related to expectation of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax positions taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified.

Use of Estimates and Assumptions

The preparation of these consolidated financial statements in conformity with US GAAP requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as of the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including valuing equity securities in share-based payment arrangements, estimating the fair value of financial instruments recorded as a warrant liability, useful lives of depreciable assets and definite lived intangible assets, and whether impairment charges may apply, and the determination of whether an asset constitutes a business a business combination or asset acquisition. Management bases these estimates on historical and anticipated results, trends, and various other assumptions that we believe are reasonable under the circumstances, including assumptions as to forecasted amounts and future events. Actual results could differ materially from these estimates under different assumptions or conditions.