Canagold Resources Ltd 6-K, filed Mar 31, 2026
Canagold Resources Ltd. (CRCUF)
About this 6-K
Canagold Resources Ltd filed this 6-K on March 31, 2026.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of March 2026
Commission File Number: 000-18860
CANAGOLD RESOURCES LTD.
(Translation of registrant's name into English)
#1250 - 625 Howe Street, Vancouver, British Columbia, Canada, V6C 2T6
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
SUBMITTED HEREWITH
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CANAGOLD RESOURCES LTD. | ||
| (Registrant) | ||
| Date: March 31, 2026 | By: | /s/ Catalin Kilofliski |
| Catalin Kilofliski | ||
| Title: | Chief Executive Officer | |
Form 52-109F1
Certification of Annual Filings
Full Certificate
I, Catalin Kilofliski, Chief Executive Officer of Canagold Resources Ltd., certify the following:
1. Review: I have reviewed the AIF, if any, annual financial statements and annual MD&A, including, for greater certainty, all documents and information that are incorporated by reference in the AIF (together, the "annual filings") of Canagold Resources Ltd. (the "issuer") for the financial year ended December 31, 2025.
2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the annual filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, for the period covered by the annual filings.
3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the annual financial statements together with the other financial information included in the annual filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the annual filings.
4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.
5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer(s) and I have, as at the financial year end
(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that
(i) material information relating to the issuer is made known to us by others, particularly during the period in which the annual filings are being prepared; and
(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and
(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.
5.1 Control framework: The control framework the issuer's other certifying officer(s) and I used to design the issuer's ICFR is the Internal Control over Financial Reporting - Guidance for Smaller Public Companies published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) (2013).
5.2 ICFR - material weakness relating to design: N/A.
5.3 Limitation on scope of design: N/A.
6. Evaluation: The issuer's other certifying officer(s) and I have
(a) evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer's DC&P at the financial year end and the issuer has disclosed in its annual MD&A our conclusions about the effectiveness of DC&P at the financial year end based on that evaluation; and
(b) N/A.
7. Reporting changes in ICFR: The issuer has disclosed in its annual MD&A any change in the issuer's ICFR that occurred during the period beginning on January 1, 2025 and ended on December 31, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.
8. Reporting to the issuer's auditors and board of directors or audit committee: The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of ICFR, to the issuer's auditors, and the board of directors or the audit committee of the board of directors any fraud that involves management or other employees who have a significant role in the issuer's ICFR.
Date: March 31, 2026
/s/ "Catalin Kilofliski"
_______________________
Catalin Kilofliski
Chief Executive Officer
Form 52-109F1
Certification of Annual Filings
Full Certificate
I, Mihai Draguleasa, Chief Financial Officer of Canagold Resources Ltd., certify the following:
1. Review: I have reviewed the AIF, if any, annual financial statements and annual MD&A, including, for greater certainty, all documents and information that are incorporated by reference in the AIF (together, the "annual filings") of Canagold Resources Ltd. (the "issuer") for the financial year ended December 31, 2025.
2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the annual filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, for the period covered by the annual filings.
3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the annual financial statements together with the other financial information included in the annual filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the annual filings.
4. Responsibility: The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.
5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer(s) and I have, as at the financial year end
(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that
(i) material information relating to the issuer is made known to us by others, particularly during the period in which the annual filings are being prepared; and
(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and
(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.
5.1 Control framework: The control framework the issuer's other certifying officer(s) and I used to design the issuer's ICFR is the Internal Control over Financial Reporting - Guidance for Smaller Public Companies published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) (2013).
5.2 ICFR - material weakness relating to design: N/A.
5.3 Limitation on scope of design: N/A.
6. Evaluation: The issuer's other certifying officer(s) and I have
(a) evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer's DC&P at the financial year end and the issuer has disclosed in its annual MD&A our conclusions about the effectiveness of DC&P at the financial year end based on that evaluation; and
(b) N/A.
7. Reporting changes in ICFR: The issuer has disclosed in its annual MD&A any change in the issuer's ICFR that occurred during the period beginning on January 1, 2025 and ended on December 31, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.
8. Reporting to the issuer's auditors and board of directors or audit committee: The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of ICFR, to the issuer's auditors, and the board of directors or the audit committee of the board of directors any fraud that involves management or other employees who have a significant role in the issuer's ICFR.
Date: March 31, 2026
/s/ "Mihai Draguleasa"
_______________________
Mihai Draguleasa
Chief Financial Officer
CANAGOLD RESOURCES LTD.
Fourth Quarter Report
Management Discussion and Analysis
(expressed in United States dollars)
Years ended December 31, 2025 and 2024
CANAGOLD RESOURCES LTD.
(the "Company")
Fourth Quarter Report
Management's Discussion and Analysis
For the Years ended December 31, 2025 and 2024
(expressed in United States dollars)
CAUTION - FORWARD LOOKING STATEMENTS
Certain statements contained herein regarding the Company and its operations constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, assumptions or expectations of future performance, are "forward-looking statements". We caution you that such "forward looking statements" involve known and unknown risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such statements. Such risks and uncertainties include fluctuations in precious metal prices, unpredictable results of exploration activities, uncertainties inherent in the estimation of mineral reserves and resources, if any, fluctuations in the costs of goods and services, problems associated with exploration and mining operations, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors, as discussed in the Company's filings with Canadian and American Securities regulatory agencies. The Company expressly disclaims any obligation to update any forward-looking statements, other than as may be specifically required by applicable securities laws and regulations.
1.0 Preliminary Information
The following Management's Discussion and Analysis ("MD&A") of Canagold Resources Ltd. (the "Company", "Canagold") should be read in conjunction with the accompanying the audited consolidated financial statements as at December 31, 2025, 2024 and 2023, and a summary of significant accounting policies and other explanatory information, prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB"), all of which are available on the SEDAR+ website at www.sedarplus.ca.
All dollar amounts in the MD&A are expressed in United States dollars unless otherwise indicated.
All information contained in the MD&A is effective as of March 31, 2026 unless otherwise indicated.
1.1 Background
The Company was incorporated under the laws of British Columbia, and was engaged in the acquisition, exploration, development and exploitation of precious metal properties.
As the Company is focused on its mineral exploration activities, there is no mineral production, sales or inventory in the conventional sense. The recoverability of amounts capitalized for mineral property interests is dependent upon the existence of reserves in its mineral property interests, the ability of the Company to arrange appropriate financing and receive necessary permitting for the exploration and development of its property interests, confirmation of the Company's interest in certain properties, and upon future profitable production or proceeds from the disposition thereof. Such exploration and development activities normally take years to complete and the amount of resulting income, if any, is difficult to determine with any certainty at this time. Many of the key factors are outside of the Company's control. As the carrying value and amortization of mineral property interests and capital assets are, in part, related to the Company's mineral reserves and resources, if any, the estimation of such reserves and resources is significant to the Company's financial position and results of operations.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.2 Overall Performance
The Company currently owns a direct interest in the precious metal properties, known as the New Polaris property (British Columbia), the Windfall Hills property (British Columbia), and the Corral Canyon property (Nevada) as well as a portfolio of smaller exploration properties in Nevada and Idaho.
1.2.1 New Polaris property (British Columbia, Canada)
The Company owns a 100% interest in the New Polaris property, located in the Atlin Mining Division, British Columbia, The Company acquired the 100% interest in the New Polaris property from Rembrandt Gold Mines Ltd in 1994. The project is stated in certain public disclosure to be subject to a 15% net profit interest, which Canagold can reduce to 10% net profit interest by issuing 150,000 shares to Rembrandt Gold Mines Ltd. Canagold has disputed the validity of the net profit interest and no net profit interest, royalty or other duly executed agreement has been proffered or presented which supports the existence of the net profit interest. As such, Canagold has excluded the net profit interest from the economic model calculation.
Feasibility study
On July 21, 2025, the Company announced the feasibility study results. The feasibility study report was filed on SEDAR PLUS on September 3, 2025.
Feasibility study highlights include (all dollar figures in the highlights are in Canadian dollars, unless otherwise indicated):
Project Economics
- After-tax net present value ("NPV") of $425 million generating an after-tax internal rate of return ("IRR") of 30.9%, with a project payback of pre-production capital expenditures ("CAPEX") of 2.4 years, assuming a discount rate of 5.0% and a US$2,500 base case Gold Price per ounce ("Gold Price")
- After-tax NPV of $793 million generating an after-tax IRR of 47.3 %, with a project payback of preproduction CAPEX of 1.7 years, assuming a discount rate of 5.0% and a US$3,300 spot Gold Price
- Life of mine ("LOM") after-tax free cash flow of $649 million at a US$2,500 base case Gold Price
- LOM after-tax free cash flow of $1.1 billion at a US$3,300 Spot Gold Price
High Grade, Low CAPEX and Low AISC
- Estimated pre-production capital expenditures CAPEX of $250 million
- LOM all-in sustaining cost ("AISC") per payable gold US$1,247/oz.
- High-grade underground mine averaging a LOM diluted grade of 9.94 g/t gold containing 904,000 ounces of Gold
- LOM mill recovered gold production of 805,589 ounces
After-Tax NPV (5%), IRR and Cash Flow Sensitivities to Gold Prices
| Low Case | Base Case | High Case | Spot Case | |
| Gold Price (US$/oz) | $2,200 | $2,500 | $2,800 | $3,300 |
| After-Tax NPV (5%) (C$M) | $287 | $425 | $564 | $793 |
| After-Tax IRR (%) | 23.5 | 30.9 | 37.5 | 47.3 |
| After-Tax Payback (years) | 2.9 | 2.4 | 2.1 | 1.7 |
| After-Tax NPV/Initial Capex | 1.1 | 1.7 | 2.3 | 3.2 |
| After-Tax Free Cash Flow ($M) | $465 | $649 | $835 | $1,145 |
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
Table 2: New Polaris FS Project Parameters
| Base Case Economic Assumptions | |
| Gold Price (US$/oz) | $2,500 |
| Exchange Rate (C$/US$) | 0.725 |
| Discount Rate | 5% |
| Contained Metals Mined | |
| Contained Gold (koz) | 904 |
| Contained Antimony (tonnes) | 5173 |
| Mining | |
| Mine Life (years) | 8.3 |
| Waste (Mt) | 1.8 |
| Total Material Mined (Mt) | 4.6 |
| Total Mineralized Material Mined (Mt) | 2.8 |
| Processing | |
| Processing Throughput (ktpa) | 340 |
| Average Diluted Gold Grade (g/t) | 9.9 |
| Gold Production | |
| Gold Recovery (%) | 89.1 |
| LOM Recovered Gold in Concentrate (xoz) | 806 |
| LOM Payable Gold Production (koz) | 709 |
| LOM Avg. Annual Gold Production (koz) | 85.7 |
| Operating Costs Per Tonne | |
| Mining Cost ($/t Milled) | $135 |
| Processing Cost ($/t Milled) | $64 |
| G&A Cost (C$/t Milled) | $68 |
| Total Operating Costs ($/t Milled) | $267 |
| Other Costs | |
| Concentrate Transportation to Smelter ($/wmt) | $1,089 |
| Cash Costs and All-in Sustaining Costs | |
| LOM Cash Cost (US$/oz Au) | $997 |
| LOM All-in Sustaining Cost (US$/oz Au) | $1,247 |
| Capital Expenditures | |
| Pre-production Capital Expenditures ($M) | $250 |
| Sustaining Capital Expenditures ($M) | $225 |
| Closure Expenditures ($M) | $21 |
| Economics | |
| After-Tax NPV (5%) ($M) | $425 |
| After-Tax IRR % | 30.9 |
| After-Tax Payback Period (years) | 2.4 |
| After-Tax NPV / Initial Capex | 1.7 |
| Pre-Tax NPV (5%) ($M) | $667 |
| Pre-Tax IRR % | 38.4 |
| Pre-Tax Payback Period (years) | 2.3 |
| Pre-Tax NPV / Initial Capex | 2.7 |
| LOM After-tax Free Cash Flow ($M) | 649 |
- Cash costs are inclusive of mining costs, processing costs, site G&A, off-site charges and royalties
- AISC includes total cash cost, sustaining CAPEX and closure cost
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
- All dollar ($) figures are presented in CAD unless otherwise stated. Base case metal price used in this economic analysis is US$2,500 /oz Au.
Mineral Resource Estimate
The Company's current Mineral Resource Estimate ("MRE"), completed by Moose Mountain Technical Services, has an effective date of January 22, 2025 with the mineralization model as the basis for the FS. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability at this time.
The New Polaris Mineral Resources for gold and antimony are shown in the tables below:
New Polaris April 2, 2025 Gold Resource Estimate at 4 g/t cut-off
| Resource Class | Tonnes (000's) | Au (g/t) | Au Metal Ozs (000's) |
| Indicated | 2,965 | 11.6 | 1,107 |
| Inferred | 926 | 8.5 | 266 |
Antimony Resource Estimate within the Base Case Au Resource
| Resource Class | Tonnes (000's) | Sb (%) | Sb Metal (Tonnes) |
| Indicated | 860 | 0.65 | 5,630 |
| Inferred | 100 | 1.2 | 1,195 |
Notes on the Resource Tables:
1. The Mineral Resource Estimate was completed by Sue Bird, P.Eng. who is a Qualified Person as defined under NI 43-101.
2. Resources are reported using the 2014 CIM Definition Standards and were estimated using the 2019 CIM Best Practices Guidelines.
3. The base case Mineral Resource has been confined by "reasonable prospects of eventual economic extraction" shape using the following assumptions:
- Metal prices of US$1,750/oz Au and Forex of 0.75 $US: $CDN
- Payable metal of 99% Au
- Offsite costs (refining, transport and insurance) of US$7/oz
- Mining cost of CDN$82.78/t
- Processing costs of CDN$105.00/t and G&A and site costs of CDN$66.00/t
- Metallurgical Au recovery of 90.5%
4. The resulting Net Smelter Return per tonne of ore equation is: NSR (CDN$/t) = Au (g/t) x 90.5% x C$74.72 /g Au.
5. The specific gravity is 2.81 for the entire deposit.
6. The Antimony Resource is reported as a subset of the total Mineral resource at the 4 g/t Au cutoff.
7. The Sb is a by-product of the Au processing and therefore is reported using the same Classification as the Au resource at the 4 gpt Au cutoff.
8. Numbers may not add due to rounding.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
About the Mineral Resource Estimate
- A comprehensive statistical review of all available QA/QC assay data from the drilling was undertaken as part of the MRE
- Historic drill results have been validated with recent drilling
- Gold values were capped for each individual domain of the geological model based on statistical probability plots
- The MRE is based on a 5 m block model using a Percentage Model (meaning that the percentage of the block within the domain is used for the MRE)
- A constant specific gravity of 2.81 g/cc is used for all blocks in the model, based on an average of measured sample SG's
- Indicated classification of a block required either 1) average distance to two drill holes of 35 m, maximum distance 50 m and minimum number of two quadrants, or 2) average distance to two drill holes of 50 m, maximum distance 70 m and minimum number of two quadrants, or 3) distance to closest drill hole of 10 m, maximum distance of 50 m used and minimum number of three drill holes used
- The classification was checked for cohesiveness, with a cohesive shape of Indicated and Inferred material produced
- The base case cutoff grade of 4 gpt Au is based on a US$1,750/ounce price of gold and preliminary recovery, processing and mining costs which are based on preliminary production rate values as summarized in the Notes to the resource table
- The MRE table presents undiluted values of gold grade and contained gold ounces
- The following factors, among others, could affect the MRE: assumptions used in generating confining shapes, stope design; mining methods; metal recoveries, mining and process cost assumptions and commodity price and exchange rate assumptions. The QP is not aware of any environmental, permitting, legal, title, taxation, socioeconomic, marketing, political, or other relevant factors that could materially affect the MRE
Mineral Reserve Estimate
The mineral reserves are summarized in table below.
Mineral Reserves
| Reserve Class | Tonnes (000's) | Au (g/t) | Au Metal Ounces ('000s) |
| Probable | 2,830.2 | 9.94 | 904.4 |
| Total | 2,830.2 | 9.94 | 904.4 |
Notes on the Reserve Table:
1. This Mineral Reserve Estimate has an effective date of July 10, 2025 and is based on the updated Mineral Resource estimate issued on February 21, 2025 by Moose Mountain Technical Services.
2. The Mineral Reserve estimate was completed under the supervision of Dino Pilotto, P.Eng. of JDS Energy and Mining Inc., who is a Qualified Person as defined under NI 43-101.
3. A cut-off grade of 6.0 g/t Au was used to define reserves for production and a 4.2 g/t Au marginal cut-off value for development ore, based on a gold metal price of U$2,245/oz., exchange rate of CAD$1.39 = US$1.00.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
4. Processing costs of C$88/t ore, C$105/t mining costs, G&A costs of C$67/t ore, gold processing recovery of 89.75%, and payable gold of 90%.
Mining Overview
The New Polaris mine is designed as a modern, fully-mechanized underground operation, targeting the safe and cost-effective extraction of mineral reserves over an estimated 8.3 year mine life. The plan anticipates delivering approximately 2.8 million tonnes (Mt) of mill feed at an average grade of 9.9 g/t gold.
A total of 1.8 Mt of waste rock will be generated during LOM underground development. Of this, the majority will be used as backfill material within the mine to support mined-out areas, with the remaining volume placed on surface in the integrated tailings and waste rock storage facility.
The mineral reserves are located beneath the historic workings of the Polaris-Taku mine, which operated from 1938 to 1951 and produced 740,000 tonnes at an average grade of 10.3 g/t gold. The new underground access will be established via a ramp extending from the existing New Polaris portal, reaching an ultimate depth of approximately 780 meters. The primary ore body, known as the 'C' zone, accounts for nearly 90% of total reserves, extends up to 500 meters along strike, and dips at an average angle of 50 to 60 degrees.
Geotechnical assessments indicate favorable rock conditions, with typical ground control measures and associated costs anticipated.
To optimize recovery and minimize costs, two main mining methods will be employed:
- Mechanized cut-and-fill mining will be used in areas where high selectivity, minimal dilution, and strong recovery rates yield the greatest value
- Sublevel long-hole mining will be applied in zones where its inherently low unit cost delivers optimal economic benefit
Mine development and early construction activities will be carried out by an experienced underground mining contractor, with operations transitioning to an owner-operated model upon commencement of production. The underground mine is expected to employ approximately 190 personnel, sustaining an average production rate of 950 tpd throughout the mine's operating life.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
Processing Overview
Processing will occur in a 1000 tpd crushing, grinding and flotation plant to produce a bulk sulphide flotation concentrate which will be shipped off site for final processing at an independent processing facility.
Crushed ore is ground to 80% minus 74um and fed into a flotation circuit consisting of one stage of rougher flotation with two cleaning stages to produce concentrate grading > 100 g/t Au.
Flotation concentrate is thickened, filtered and dried, to a moisture of approximately 5% and flown to Juneau, Alaska, which is located approximately 60 km from site, then barged to Seattle for loading onto ocean going ships for transportation to third-party smelters worldwide.
A portion of the process tailings will be fed to a backfill plant and used for filling underground mining voids, the balance will be filtered and trucked to a dry-stack storage facility located about 1 km from the plant site. Waste rock not used for underground backfilling will also be trucked to this facility for storage with the tailings.
Concentrate Marketing Study
An independent concentrate marketing study for the New Polaris Project, evaluating marketability and treatment terms for its gold concentrate has been completed as part of the FS. The study confirms that the New Polaris gold concentrate, targeted at a grade exceeding 100 g/t Au, and an average 12% As, is marketable under current global conditions.
The report identifies potential outlets for the sale of New Polaris gold concentrate, including:
- Traditional gold roasters in Asia, which represent an established and high-capacity processing route
- Blending facilities, where the concentrate can be mixed with other materials prior to shipment to smelters
- Asian gold roasters, copper smelters, or lead smelters
- Direct sales to international metal trading firms, which offer flexible and liquid off-take arrangements
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
- Pressure oxidation (POX) plants
Based on indicative commercial terms provided by several prospective buyers, the marketing study validated the project's financial modeling assumptions related to treatment charges and gold payability. The analysis concluded that an average net smelter return (NSR) of 87.9% for gold is reasonable over the LOM and reflects treatment charges associated with the presence of As in the concentrate.
Capital Costs
The initial capital cost is estimated at $250M (US$181M) and shown in the table below:
| Initial | Sustaining | LOM Total | |
| Mining ($M) | $63.3 | $196.1 | $259.4 |
| Processing ($M) | $43.0 | - | $43.0 |
| Tailings ($M) | $7.4 | $4.7 | $12.1 |
| Onsite Infrastructure ($M) | $38.5 | - | $38.5 |
| Offsite Infrastructure ($M) | $9.4 | - | $9.4 |
| Indirects ($M) | $42.3 | - | $42.3 |
| Project Delivery ($M) | $9.8 | - | $9.8 |
| Owner's Costs ($M) | $7.8 | - | $7.8 |
| Total excluding Contingency ($M) | $221.5 | $200.8 | $422.3 |
| Project Contingency ($M) | $28.8 | $24.2 | $53.0 |
| Closure ($M) | - | - | $20.5 |
| Total ($M) | $250.4 | $225.0 | $495.8 |
Note: Totals may differ slightly due to rounding
Operating Costs
The LOM Total Cash Cost is US$997/oz Au payable while the LOM AISC is US$1,247/oz Au payable. Unit Operating costs are shown in the table below.
Operating Costs Per Tonne Milled
| Operating Costs Per Tonne | $/t |
| Mining Cost ($/t Milled) | 135.45 |
| Processing Cost ($/t Milled) | 64.28 |
| G&A Cost ($/t Milled) | 67.58 |
| Total Operating Costs ($/t Milled) | 267.31 |
Financial Analysis
At a US$2,500 base case gold price and a C$:US$ exchange of 0.725:1, the Project generates an after-tax NPV (5%) of $425 million and IRR of 30.9%. Payback on initial capital is 2.4 years.
The Project Financials are shown in table below:
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
New Polaris Project Financials
| After-Tax NPV (5%) ($M) | $425 |
| After-Tax IRR (%) | 30.9 |
| After-Tax Payback Period (years) | 2.4 |
| After-Tax NPV / Initial Capex | 1.7 |
| Pre-Tax NPV (5%) ($M) | $667 |
| Pre-Tax IRR (%) | 38.4 |
| Pre-Tax Payback Period (years) | 2.3 |
| Pre-Tax NPV / Initial Capex | 2.7 |
| LOM After-tax Free Cash Flow ($M) | $649 |
Regulatory and Environmental Assessment Process
The Project is subject to a range of regulatory approvals, including a consent decision from the Taku River Tlingit First Nation (TRTFN) and an Environmental Assessment Certificate (EAC) under British Columbia's Environmental Assessment Act. Once the environmental assessment process is completed, the necessary construction and operating permits may be applied for and issued in accordance with applicable provincial and federal legislation.
The project formally entered the BC Environmental Assessment (EA) process in 2023. In September 2024, the British Columbia Environmental Assessment Office (BCEAO) issued a Readiness Decision, concluding there is sufficient information to proceed with the Environmental Assessment Application. Canagold's consulting team is currently preparing the required technical studies and supporting documentation, with the EA application targeted for submission at the end March 2026.
The ongoing involvement, input, and support of the TRTFN have been instrumental in ensuring that their interests are recognized and addressed throughout the process. Their collaboration continues to play a critical role in helping advance and streamline the regulatory review.
For more details, see the news release of the Company issued on July 21, 2025 and named Canagold Announces Positive Feasibility Study Results for the New Polaris Project.
Qualified Persons who approved the issuance of the feasibility results are:
In accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects, Garry Biles, P. Eng., President & COO is the Qualified Person for the Company and has prepared, validated, and approved the technical and scientific content of this news release. The Company strictly adheres to CIM Best Practices Guidelines in conducting, documenting, and reporting activities on its projects.
Sue Bird, M Sc., P.Eng., V.P. of Resources and Engineering at Moose Mountain Technical Services, an independent Qualified Person as defined by NI 43-101. Sue has also reviewed and approved the technical information about the 2025 MRE resource contained in this news release.
Tommaso Roberto Raponi, P. Eng., Principal Metallurgist with Ausenco Engineering Canada ULC., is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Raponi is responsible for mineral processing and metallurgical testing in the technical report.
Kevin Murray, P. Eng., Principal Process Engineer for Ausenco Engineering Canada ULC., is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Murray is responsible for processing, process and infrastructure capital and operating cost estimation, financial analysis and marketing in the technical report.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
James Millard, P. Geo., Director, Strategic Projects with Ausenco Sustainability ULC., a wholly owned subsidiary of Ausenco Engineering Canada ("Ausenco") is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Millard is responsible for the sections and subsections related to environmental, permitting, and social and community aspects in the technical report.
Jonathan Cooper, MSc., P.Eng., Water Resources Engineer with Ausenco Sustainability ULC., a wholly owned subsidiary of Ausenco Engineering Canada ("Ausenco") is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Cooper is responsible for the sections and subsections related to site-wide water management in the technical report.
Dino Pilotto, P. Eng., General Manager, Technical Services with JDS Energy & Mining Inc., is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Pilotto is responsible for mining methods in the technical report.
Mike Levy, P. Eng., Geotechnical Manager with JDS Energy & Mining Inc., is an independent Qualified Person as defined by NI 43-101 and has reviewed and verified the contents of this news release. Mr. Levy is responsible for the underground geotechnical assessment in the technical report.
History of other exploration advancements:
On April 17, 2019, the Company filed on SEDAR its updated NI 43-101 report (the "Preliminary Economic Assessment") by Moose Mountain Technical Services ("Moose Mountain"). The details of the Preliminary Economic Assessment" report can be found in the latest annual information form of the Company filed on SEDAR +.
In September 2020, the Company was granted a Multi Year Area Based Notice of Work Mineral and Coal Exploration Activities and Reclamation Permit by the BC Ministry of Energy, Mines and Low Carbon Innovation to conduct exploration work on the property. Site preparation and refurbishment was completed to facilitate environmental baseline study and infill drilling to advance to a feasibility study. In late 2020, the Company had initiated environmental baseline studies which are required for an Environmental Assessment Certificate application and which is a critical first step in advancing the project through the BC major mine permitting process.
In 2021, the Company completed its 47-hole, 24,000 meter (m) infill drilling program designed to upgrade the Inferred Resources of the CWM vein system to an Indicated Resource category for inclusion in a future feasibility study. The infill drill holes range in depth from 300 to 650 m and are designed to provide greater density of drill intercepts (20 - 25 m spacing) in areas of Inferred Resources between 150 and 600 m below surface. The drill program was extended with an additional 6,000 m and 7 drill holes completed by the end of February 2022. The infill drill holes intercepted gold grades over widths throughout the CWM vein system that support the current resource at depth as predicted by the geological model and defined in the Preliminary Economic Assessment. Additionally, the infill drill program has defined new areas of significant gold mineralization such as the C-9 and C-10 veins that have potential to add resource to the deposit. By mid July 2022, assay results were received for all 54 holes of the drill program.
In August 2022, the Company mobilized an 8,000 m drilling program targeting the shallower high-grade Y-vein system which consists of two parallel, steeply dipping veins striking north-south and located just north of the C-West Main vein. This target provides an opportunity to define high grade resources at a shallow depth that could be accessed early in the mine life. High grade intercepts from previous drill holes in this area included 30.6 grams per tonne ("gpt") gold ("Au") over 3.2 m, 13.0 gpt Au over 6.8 m and 22.7 gpt Au over 8.0 m. The drilling program was designed to upgrade the Y-vein resources from Inferred to Indicated category for inclusion in the feasibility study and to explore this vein system for extensions at depth. By late January 2023 assay results were received for all 25 drill holes of the Y vein drill program.
In October 2022, the Company retained Ausenco Engineering Canada Inc. to complete a feasibility study for the New Polaris gold project. Key objectives for the feasibility study include:
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
- Resource model update (to include nearly 40,000 metres of additional drilling completed)
- Mining reserves calculation and detailed underground mine plan development
- Engineer and design all surface infrastructure and processing facilities to include among others: flotation, bio-oxidation, leaching and gold doré bar production
- Engineer and design surface dry stack tailings and waste rock disposal facility (with no long-term adverse impact on the environment)
- Evaluate all renewable power alternatives that may be feasible for New Polaris
- Complete detailed capital and operating cost estimates, including a detailed financial model for the life of the project
The feasibility study concluded in the summer of 2025.
In October 2022, the Company signed the Hà Khustìyxh / "Our Way" agreement that establishes the framework for a cooperative and mutually respectful working relationship with the Taku River Tlingit First Nation ("TRTFN") to support Canagold's exploration and advancement activities at New Polaris while ensuring to minimize any adverse impacts of mining activity on the rights and interests of the TRTFN. The agreement also lays the foundation for negotiation of future long-term agreements as the project progresses through its permitting, construction and production phases.
In March 2023, the Company submitted its Initial Project Description (IPD) and Engagement Plan submission to the B.C. Environmental Assessment Office. The Company's IPD submission formally initiates the early engagement phase of the provincial assessment process. In the IPD, the Company provides an overview and detailed description of the Company's plans to develop, operate, and eventually decommission the New Polaris Gold Project.
In May 2023, the resource model was updated to:
• 89% increase in the Indicated category contained ounces of gold compared to the 2019 preliminary economic assessment resource due to a very successful 2021-22 infill drill program.
• 23% increase to the overall resource tonnage due to the additional veins defined by the 2021-22 infill drilling that were integrated into the new geological model
• Gold grade improvement by 8% in the indicated category to 11.61 gpt Au, up from 10.8 gpt Au in the 2019 preliminary economic assessment due to the refined geological model constrained by the additional drilling.
• The updated 2023 MRE provides the Indicated category resource required to underpin the feasibility study announced on October 11, 2022.
• Underground mineral resource estimate 2.97 million tonnes (Mt)@ 11.6 grams per tonne gold (gpt Au) for 1.11 million ounces (Moz) contained gold indicated and 0.93 Mt @ 8.93 gpt Au for 0.27 Moz contained gold inferred.
Deepak Malhotra, Ph.D., SME-RM and Sue Bird, P.Eng, are the QPs for the mineral resource update report.
On March 28, 2024, the Company raised $CAD 4.1 million from issuance of flow through shares. The Company used the proceeds for exploration activities at the Company's New Polaris project. The exploration activities consisted mainly of a drilling program targeting an increase in the mineral resource. The program concluded in August 2024 with the following highlights:
• 10.8 grams per tonne ("gpt") gold ("Au") over 4.3 m from 176.4 m down hole in Hole NP24-34
o Including 15.5 gpt Au over 2.0 m from 177.5 m
• 10.4 gpt Au over 3.6 m from 166.8 m down hole in Hole NP24-34
o Including 12.3 gpt Au over 1.3 m from 166.8 m
• 14.1 gpt Au over 1.1 m from 202.7 m down hole in Hole NP24-33A
• 10.4 gpt Au over 1.2 m from 252.3 m down hole in Hole NP24-33A
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
In September 2024, the British Columbia Environmental Assessment Office (BCEAO) has recommended that the New Polaris Project proceed to the Process Planning Phase of the environmental assessment. This recommendation follows a thorough review that evaluated the potential environmental and socio-economic impacts of the project.
In January 2025, BCEAO issued a process order, enabling the Project to proceed to the Application Development and Review phase of the Environmental Assessment. This marks a crucial step forward in the permitting process for the New Polaris Project.
During this phase, Canagold will prepare and submit its application for an Environmental Assessment Certificate while continuing its robust engagement efforts with Indigenous Nations, regulatory bodies, and other stakeholders. Prior to issuing the process order, BCEAO conducted a thorough review process that included feedback from participating Indigenous Nations, the Technical Advisory Committee (TAC), Alaskan Tribes, and the public, facilitated through a public comment period.
In February 2025, Canagold updated the mineral resource to quantify the antimony metal contained within the gold resource:
- 5,630 tonnes of antimony metal within the base case indicated gold resource, and
- 1,195 tonnes of antimony metal within the base case inferred gold resource
In 2025, further analysis of the antimony resource and expansion potential will take place, accompanied by additional metallurgical testing, aimed at establishing the best processing methods for producing a commercially viable antimony product.
Sue Bird, M Sc., P.Eng. V.P. of Resources and Engineering at Moose Mountain Technical Services, an independent Qualified Person as defined by NI 43-101, has reviewed and approved the technical information about the 2023 mineral resource update and 2025 antimony resource published by the Company (see News Release dated February 21, 2025 and titled "Canagold Announces Antimony Mineral Resource Estimate for New Polaris Gold Project")
In March 2025, Canagold closed a charity flow-through financing for the New Polaris project. The Company issued 9,200,000 common shares of the Company for total gross proceeds of CAD $3,220,000.
In August 2025, the Company closed a private placement for 4,651,163 flow through common shares at a price of CAD$0.43 per share for gross proceeds of CAD$2 million.
On February 13, 2026, Canagold closed an offering for total proceeds of CAD5,000,000 consisting of 10,000,000 common shares that qualify as flow-through shares for the purposes at a price of CAD$0.50 per share.
On February 25, 2026, announced plans for a comprehensive 2026 work program at New Polaris, focused on expanding gold-antimony resources and advancing technical studies to evaluate the financial benefits of incorporating antimony production into the project development plans and economics. The fully funded program, will include approximately 7,000 metres of diamond drilling, scheduled to commence in June and continue through July 2026. The drilling will target expansion of the high-grade gold-antimony mineralization within and adjacent to the current mine plan outlined in the feasibility study completed in July 2025. The objective is to further define and potentially increase the gold-antimony resource base in areas expected to have a direct and positive impact on early production and overall project economics.
On March 16, 2026, Canagold announced that its 100%-owned New Polaris has been added to the Canadian government advanced gold-antimony projects map.
Further details of the 2021, 2022 and 2024 drilling programs are provided in the Company's news releases:
• News release dated July 6, 2021 and titled, "Canagold Announces Initial 2021 Drill Results From New Polaris Project Including 24.2 gpt Gold over 6.6 m and 15.8 gpt Gold Over 13.0 m";
• News release dated July 19, 2021 and titled, "Canagold Announces Additional Results From New Polaris Drill Program Including 14.3 gpt Au Over 2.7 m and 15.3 gpt Au Over 1.7 m";
• News release dated July 27, 2021 and titled, "Canagold Drills 30.8 gpt Gold Over 3.9 Meters at New Polaris Project";
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
• News release dated September 22, 2021 and titled, "Canagold Intersects 17.1 gpt Au Over 8.4 m in Hanging-Wall C10 Vein and 25.7 gpt Au Over 2.1 m in C West Main Vein at New Polaris, BC";
• News release dated November 10, 2021 and titled, "Canagold Intersects 11.1 gpt Au over 17.8 m and 11 gpt over 8.9 m in 2 Separate Hanging-Wall Veins Adjacent to C West Main Vein at New Polaris Gold Project, BC";
• News release dated November 10, 2021 and titled, "Canagold Intersects 11.1 gpt Au over 17.8 m and 11 gpt over 8.9 m in 2 Separate Hanging-Wall Veins Adjacent to C West Main Vein at New Polaris Gold Project, BC";
• News release dated November 30, 2021 and titled, "Summary of High-Grade Drill Intercepts in the C-9 and C- 10 Veins at the New Polaris Project in BC";
• News release dated January 26, 2022 and titled, "Canagold Announces High-Grade Drill Intercepts Containing Visible Gold from the C-West Main Zone at New Polaris Project, B";
• News release dated February 24, 2022 and titled, "Canagold Continues to Intersect High-Grade Gold Mineralization in C-West Main Vein at New Polaris Project, BC";
• News release dated March 2, 2022 and titled, "Canagold Drilling Intersects Deep Extension of C-West Main Vein, and Discovers New High-Grade Parallel C-Vein at New Polaris Project, BC";
• News release dated March 21, 2022 and titled, "Canagold Announces Additional High-Grade Gold Drill Intercepts from the C-10 and the C-West Main Veins at New Polaris Project, BC";
• News release dated April 21, 2022 and titled, "Canagold Continues to Intersect High-Grade Gold Mineralization in C-West Main Vein Including 42.5 gpt Au over 2 m at New Polaris Project, BC".
• News release dated June 14, 2022 and titled, "Canagold Drilling Intersects New Vein Grading 7.54 gpt Gold over 18.6 m Length at New Polaris Project, BC, Additional High-Grade Mineralization Outlined in C-West Main Vein";
• News release dated June 28, 2022 and titled, "Canagold Drilling Reports Two Highest Grade Drill Results of 54 Hole Program Including 13.6 gpt Gold over 25.1 m Length and 34.4 gpt over 6.6 m Length at New Polaris Project, BC";
• News release dated July 12, 2022 and titled, "Canagold Summarizes Results of 30,000 m Infill Drill Program at New Polaris Project, BC, Highlights Include 13.6 gpt Over 25.1 m";
• News release dated August 18, 2022 and titled, "Canagold Mobilizes Drill Crews and Restarts Resource Expansion Drilling at the New Polaris Project";
• News release dated October 11, 2022 and titled, "Canagold Retains Ausenco Engineering to Complete Feasibility Study on New Polaris Project";
• News release dated October 27, 2022 and titled, "Canagold Drills 22.1 Grams per Tonne Gold over 4.3 Metres in Y-Vein System at New Polaris";
• News release dated January 25, 2023 and titled, "Canagold Announces Agreement with Taku River Tlingit First Nation for Flagship New Polaris Project";
• News release dated February 6, 2023 and titled, "Canagold Confirms Near Surface High-Grade Gold, Including 53.8 gpt Au over 2.78 m and 18.0 gpt Au over 5.64 m in Y-Vein System at New Polaris"; and
• News release dated May 16, 2023 and titled, "Canagold Increases Indicated Gold Resource by 89% in Updated Mineral Resource Estimate for New Polaris Gold Project, BC".
• News release dated June 5, 2024 and titled, "Canagold Initiates Resource Expansion Drilling at New Polaris Project"
• News release dated July 18, 2024 and titled, "Canagold Intercepts Strong Mineralization in First Five Resource Expansion Drill Holes at New Polaris"
• News release dated August 29, 2024 and titled, "Canagold Continues to Intercept Strong Mineralization in Resource Expansion Drilling Program at New Polaris"
• News release dated September 18, 2024 and titled, "Canagold Completes Resource Expansion Drilling Program at New Polaris with Additional Strong Mineralization Intercepts"
Details of the expenditures amounts incurred by the Company to advance New Polaris are included in section 1.4 of this MD&A.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.2.2 American Innovative Minerals, LLC
1.2.2. Purchase Agreement with American Innovative Minerals, LLC
In 2017, the Company closed a Membership Interest Purchase Agreement (the "Membership Agreement") with American Innovative Minerals, LLC ("AIM") and securityholders of AIM ("the AIM Securityholders") to acquire either a direct or indirect 100% legal and beneficial interests in mineral resource properties located in Nevada, Idaho and Utah (USA) for a purchase price of $2 million in cash and honouring pre-existing NSRs.
AIM owns 8 gold properties in Nevada and one gold property in Idaho. Until December 29, 2023, the Company owned two additional gold properties in Nevada (Fondaway Canyon and Dixie Comstock). Pursuant to an agreement from January 2020, on December 29, 2023, Getchell Gold Corp ("Getchell") exercised its option to acquire the Fondaway Canyon and Dixie Comstock properties by making the final payment of $1.6 million in cash stipulated under the January 2020 agreement and issuing 10,167,000 Getchell Shares to the Company.
AIM's properties include:
1.2.2.a Silver King (Nevada, USA)
Silver King property is located in Humboldt County, Nevada on 4 patented claims in the Iron Point mining district near Golconda Summit. Previous exploration focused on low grade gold values but the property has never been explored for silver.
On October 25, 2018, the Company entered into an option agreement with Brownstone Ventures (US) Inc., a subsidiary of Casino Gold Corp., ("Brownstone Ventures") on the Company's wholly owned Silver King patented claim group located in Humboldt County, Nevada. Under the terms of the ten-year agreement, the Company will receive annual payments of $12,000 plus an option exercise payment of $120,000. Upon exercise of the option, the Company will retain a 2% NSR royalty on the property of which Brownstone Ventures will have the right to buy back one-half (1%) of the royalty for $1 million.
1.2.2.b Lightning Tree (Idaho, USA)
Lightning Tree property is located in Lemhi County, Idaho, on 4 unpatented claims near the Musgrove gold deposit.
On September 10, 2020, the Company entered into an option agreement in the form of a definitive mineral property purchase agreement for its Lightning Tree property located in Lemhi County, Idaho, with Ophir Gold Corp. ("Ophir"), whereby Ophir shall acquire a 100% undivided interest in the property. In order to acquire the property, over a three year period, Ophir shall pay to the Company a total of CAD$137,500 in cash over a three year period and issue 2.5 million common shares and 2.5 million warrants over a two year period, and shall incur aggregate exploration expenditures of at least $4 million over a three year period. In Q3 2023, the Company and Ophir mutually terminated the option agreement, and the Lightning Tree property has been returned to the Company.
1.2.2.c Corral Canyon property (Nevada, USA)
Corral Canyon property lies 35 km west of the town of McDermitt in Humboldt County along the western flank of the McDermitt caldera complex, an area of volcanic rocks that hosts significant lithium and uranium mineralization in addition to gold. It contains volcanic-hosted, epithermal, disseminated and vein gold mineralization evidenced by previous drilling.
In 2018, the Company staked 92 mining claims covering 742 hectares in Nevada, USA.
In November 2019, a five hole, 1600 meter drilling program was completed. Further details of the drilling program for the Corral Canyon project are provided in the Company's news release dated November 28, 2019 and titled, "Canarc Completes Phase 1 Drill Program at Corral Canyon, Nevada".
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.2.3 Windfall Hills property (British Columbia, Canada)
The Windfall Hills gold project is located 65 km south of Burns Lake, readily accessible by gravel logging roads and a lake ferry crossing in the summer-time, or by charter aircraft year-round. The project consists of the Atna properties, comprised of 2 mineral claims totalling 959 hectares and the Dunn properties, comprised of 8 mineral claims totalling 2820 hectares.
In April 2013, the Company acquired 100% undivided interests in the two adjacent gold properties (Uduk Lake and Dunn properties) located in British Columbia. The Uduk Lake properties are subject to a 1.5% NSR production royalty that can be purchased for CAD$1 million and another 3% NSR production royalty. The Dunn properties are subject to a 2% NSR royalty which can be reduced to 1% NSR royalty for $500,000.
In the third quarter of 2020, the Company completed a Phase 2 diamond drill program. Six drill holes were completed for a total of 1,500 meters of core over an area of 30 hectares designed to follow up from gold-silver mineralization intersected in the 2014 Phase 1 drill holes. Further analysis of the structural and lithological controls on mineralization are needed to determine the next steps for the Windfall Hills property. The Company may seek a partner to advance the project.
Further details of the drilling program for the Windfall Hills project are provided in the Company's news release dated October 21, 2020 and titled, "Canarc Announces Results of its Special General Meeting of Shareholders Approving Upsized Financing Totaling CAD$8.4 Million".
1.2.4 Eskay Creek property (British Columbia, Canada)
In December 2017, the Company signed an agreement with Barrick Gold Inc ("Barrick") and Skeena Resources Ltd. ("Skeena") involving the Company's 33.3% carried interest in certain mining claims adjacent to the past-producing Eskay Creek Gold mine located in northwest British Columbia, whereby the Company will retain its 33.33% carried interest. The Company and Barrick have respectively 33.33% and 66.67% interests in 6 claims and mining leases totaling 2323 hectares at Eskay Creek. Pursuant to an option agreement between Skeena and Barrick, Skeena had the right to earn Barrick's 66.67% interest in the property which right had been exercised in October 2020.
Garry Biles, PEng, President and Chief Operating Officer of the Company, was the qualified person, as defined by National Instrument 43-101, and had approved the technical information from the drilling programs for the New Polaris and Windfall Hills projects.
Other Matters
As of March 30, 2026, Sun Valley Investments AG ("Sun Valley") owns 48.25% of the outstanding shares of the Company.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.3 Selected Annual Information
| (in $000s except | Years ended December 31, | ||||||||
| per share amounts) | 2025 | 2024 | 2023 | ||||||
| Total revenues | $ | - | $ | - | $ | - | |||
| Net (loss) income: | |||||||||
| (i) Total | $ | (2,593 | ) | $ | (1,122 | ) | $ | (3,050 | ) |
| (ii) Basic and diluted per share | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) |
| Total assets | $ | 38,423 | $ | 32,745 | $ | 33,226 | |||
| Total long-term liabilities | $ | 3,207 | $ | 1,775 | $ | 1,774 | |||
1.4 Results of Operations
Year ended December 31, 2025 compared with December 31, 2024
The Company has no sources of operating revenues. Operating losses were incurred for ongoing activities of the Company in acquiring and exploring its mineral property interests, advancing the New Polaris property, and pursuing mineral projects of merit. The Company incurred a net loss of $2.56 million for fiscal 2025, which is higher than the net loss of $1.12 million for fiscal 2024. Net losses were impacted by different functional expense items. The table below (in thousands of US dollars) provides a comparison of the results of operations for 2025 vs 2024:
| Years ended December 31, | ||||||
| 2025 | 2024 | |||||
| Expenses: | ||||||
| Amortization | $ | 76 | $ | 81 | ||
| Corporate development | 127 | 126 | ||||
| Employee and director remuneration | 451 | 475 | ||||
| General and administrative | 478 | 458 | ||||
| Share-based payments | 551 | 316 | ||||
| Operating loss | (1,683 | ) | (1,456 | ) | ||
| Interest and other income | 38 | 148 | ||||
| Foreign exchange (loss) gain | (19 | ) | 71 | |||
| Change in fair value of marketable securities | (97 | ) | (143 | ) | ||
| Mineral property option income | 12 | 12 | ||||
| Interest and finance charges | (9 | ) | (12 | ) | ||
| Net loss before income tax | (1,758 | ) | (1,380 | ) | ||
| Income tax recovery | 148 | 258 | ||||
| Deferred income tax expense | (983 | ) | - | |||
| Net loss for the year | (2,593 | ) | (1,122 | ) | ||
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
Overall operating losses are consistent for 2025 and 2024, with the focus of the company, advancing the New Polaris project, being unchanged. Other than the share-based compensation, which is higher in 2025, mainly because of the revaluation of the outstanding deferred shared units to a higher share price of the company, the individual expenses listed as operating expenses are consistent year over year.
The non-operating expenses are mainly non-cash items.
Interest is income is higher in 2024 mainly because of interest received from the taxation government on a refund for a mineral tax credit claim.
Foreign exchange (loss) gains are a result of assets and liabilities held in foreign currency being revalued to end of accounting period exchange rates or higher/lower exchange rates on settlement or conversion dates.
The change in the fair value of marketable securities is attributable to changes in the quoted market prices of the investments up to their date of disposal or to period end if continued to be held.
The income tax recovery is the allocation of the premium in the flow through private placement on a pro rata basis of qualified exploration expenditures incurred during the period. In 2024, the Company incurred more flow through eligible exploration expenditures, and as such, the income tax recovery premium is higher in 2024.
The deferred tax expense of $983,000 is primarily due to the temporary difference in tax basis vs. accounting basis of the mineral property interest.
As at December 31, 2025, the Company has mineral property interests which are comprised of the following:
| Canada | |||
| British Columbia | |||
| New Polaris | |||
| (Note 7(a)(i)) | |||
| Acquisition Costs: | |||
| Balance, December 31, 2024 | |||
| Acquisition | $ | 3,921 | |
| Foreign currency translation adjustment | 12 | ||
| Balance, December 31, 2025 | 10 | ||
| 3,943 | |||
| Deferred Exploration Expenditures: | |||
| Balance, December 31, 2024 | 27,379 | ||
| Additions: | |||
| Exploration: | |||
| Assays and sampling | 5 | ||
| Community engagement and social | 716 | ||
| Drilling | 48 | ||
| Environmental | 2,639 | ||
| Feasibility | 531 | ||
| General, administrative, sundry | 6 | ||
| Metallurgy | 28 | ||
| Rental and storage | 31 | ||
| Royalties | 7 | ||
| Salaries | 350 | ||
| Transportation | 25 | ||
| Foreign currency translation adjustment | 1,574 | ||
| Balance December 31, 2025 | 33,339 | ||
| Mineral property interest: | |||
| Balance, December 31, 2025 | $ | 37,282 |
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
Details of the exploration programs are provided in section 1.2.1 of this MD&A. In 2025, the Company incurred $4.4 million in costs on advancing New Polaris, with most of the spending being attributable to environmental studies ($2.56 million), needed to obtain the environmental permit, and $716,000 of first nations community engagement. The note references in the table above pertain to the 2025 Audited Consolidated Financial Statements of the Company.
Cash flow for the year ended December 31, 2025
During 2025, the Company had an overall increase in cash of $144,000 (2024 - decrease of $2.1 million). Operating activities consumed cash of $815,000 (2024 - $364,000). Financing activities generated $4.9 million in 2025 (2024 - $2.9 million), while investing activities consumed a net of $4.2 million in 2025 (2024 - $4.6 million)
The Company generates cash from financing activities from issuance of shares and consumes the cash mainly for investing activities (advancing the New Polaris project), the secondary use of cash being administrative activities.
1.5 Summary of Quarterly Results and fourth quarter of 2025
The following table provides selected financial information of the Company for each of the last eight quarters ended at the most recently completed quarter, December 31, 2025. All dollar amounts are expressed in thousands of U.S. dollars..
| (in $000s except | 2025 | 2025 | 2025 | 2025 | 2024 | 2024 | 2024 | 2024 | ||||||||||||||||
| per share amounts) | 31-Dec | 30-Sep | 30-Jun | 31-Mar | Dec 31 | 30-Sep | June 30 | Mar 31 | ||||||||||||||||
| Total revenues | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||
| Net (loss) income: | ||||||||||||||||||||||||
| (i) Total | $ | (1,164 | ) | $ | (575 | ) | $ | (436 | ) | $ | (418 | ) | $ | (86 | ) | $ | (328 | ) | $ | (644 | ) | $ | (64 | ) |
| (ii) Basic and diluted per share | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||
| Total assets | $ | 38,423 | $ | 38,002 | $ | 36,499 | $ | 34,689 | $ | 32,745 | $ | 34,758 | $ | 35,034 | $ | 35,308 | ||||||||
| Total long-term liabilities | $ | 3,207 | $ | 2,240 | $ | 2,008 | $ | 1,855 | $ | 1,775 | $ | 1,838 | $ | 1,743 | $ | 1,751 | ||||||||
| Dividends per share | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||
The Company's main focus for the past years, including the last eight quarters, was advancing the New Polaris project. The Company's accounting policy is to capitalize project related expenses. As such, the net loss of the Company does not include expenditures directly attributable to advancing New Polaris. In general, the overhead expenses of the Company are consistent, with variances across quarters being generally attributable to non-cash items, such as changes in fair market values of the Company's investments, write-off of book values of mineral properties for which there is no planned activities, deferred income tax expense, and share based compensation expense recognized in connection with the stock options and share units issued under the compensation plan. The fourth quarter of 2025 is consistent with other quarters in terms of operating expenses, with the higher accounting loss being attributable to the recognition of a deferred tax expense due to temporary differences between the tax basis and book value of the mineral property interests.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.6 Liquidity
The Company has no operating revenues, has incurred a significant net loss of $2.56 million for the year ended December 31, 2025, and has a deficit of $59.2 million as at December 31, 2025. In addition, the Company has negative cash flows from operations. The Company's ability to continue as a going concern is dependent on the ability of the Company to raise debt or equity financings, and the attainment of profitable operations. Management continues to find opportunities to raise the necessary capital to meet its planned business objectives and continues to seek financing opportunities. There can be no assurance that management's plans will be successful. These matters indicate the existence of material uncertainties that cast substantial doubt about the Company's ability to continue as a going concern. The Company's financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern, and such adjustments could be material.
The recoverability of amounts capitalized for mineral property interests is entirely dependent upon the existence of reserves, the ability of the Company to obtain the necessary financing to complete the development and upon future profitable production. The Company knows of no trends, demands, commitments, events or uncertainties that may result in the Company's liquidity either materially increasing or decreasing at the present time or in the foreseeable future except as disclosed in this MD&A and in its regulatory filings. Material increases or decreases in the Company's liquidity are substantially determined by the success or failure of the Company's exploration and development programs and overall market conditions for smaller mineral exploration companies. In the past, the Company has endeavored to secure mineral property interests that in due course could be brought into production to provide the Company with cash flow which would be used to undertake work programs on other projects. To that end, the Company has expended its funds on mineral property interests that it believes have the potential to achieve cash flow within a reasonable time frame. As a result, the Company has incurred losses during each of its fiscal years since incorporation. This result is typical of smaller exploration companies and will continue unless positive cash flow is achieved.
The following table contains selected financial information of the Company's liquidity:
| December 31, | December 31, | |||||
| ($000s) | 2025 | 2024 | ||||
| Cash | $ | 820 | $ | 676 | ||
| Working capital | (232 | ) | 151 | |||
Ongoing operating expenses continue to reduce the Company's cash resources and working capital, as the Company has no sources of operating revenues.
During 2025, the Company generated $111,000 from disposition of marketable securities (2024 - $1.1 million).
On March 28, 2024, the Company closed a financing for 15,700,000 flow through common shares at a price of CAD$0.2625 per share for gross proceeds of CAD$4.1 million.
On March 4, 2025, the Company closed a private placement issuing 9,200,000 flow through common shares at a price of CAD$0.35 per share for gross proceeds of CAD$3.2 million
On August 18, 2025, the Company closed a private placement for 4,651,163 flow through common shares at a price of CAD$0.43 per share for gross proceeds of CAD$2 million. The fair value of the shares on August 18, 2025 was CAD$0.39 per share, resulting in the recognition of a flow through premium liability of CAD$0.04 per share for a total of CAD$186,047.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
On August 18, 2025, the Company closed a financing consisting of 5,128,205 shares at CAD $0.39 per share for aggregate gross proceeds of CAD $2 million.
On February 13, 2026 Canagold closed an offering for total proceeds of CAD$9,228,456.50 consisting of:
(i) 9,396,570 common shares iat a price of CAD$0.45 per Common Share, and
(ii) 10,000,000 common shares that qualify as flow-through shares for the purposes at a price of CAD$0.50 per share.
The Company will continue to rely upon equity financing as its principal source of financing its projects.
1.7 Capital Resources
See 1.2 above for commitments on mineral property interests.
Certain amounts may be reduced in the future as the Company determines which properties to continue to explore and which to abandon.
In January 2022, the Company entered into an office lease arrangement for a term of five years with a commencement date of September 1, 2022. The basic rent per year is CAD$84,700 for years 1 to 2, CAD$87,300 for years 3 to 4, and CAD$89,900 for year 5.
As at December 31, 2025, the Company is committed to the following payments for base rent at its corporate head office in Vancouver, BC, as follows:
| Amount | |||
| (CAD$000) | |||
| Year: | |||
| 2026 | $ | 88 | |
| 2027 | $ | 60 | |
| $ | 148 |
1.8 Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.9 Transactions with Related Parties
Key management includes directors (executive and non-executive) and senior management. The compensation paid or payable to key management is disclosed in the table below.
Except as disclosed elsewhere in the consolidated financial statements, the Company had the following general and administrative costs with related parties during the years ended December 31, 2025, 2024, and 2023:
| Net balance receivable (payable) | |||||||||||||||
| Years ended December 31, | as at December 31, | ||||||||||||||
| 2025 | 2024 | 2023 | 2025 | 2024 | |||||||||||
| Key management compensation: | |||||||||||||||
| Executive salaries and remuneration (1) | $ | 785 | $ | 833 | $ | 803 | $ | (11 | ) | $ | (13 | ) | |||
| Severance | - | - | 73 | - | - | ||||||||||
| Directors fees | 83 | 85 | 86 | (42 | ) | (27 | ) | ||||||||
| Share-based payments | 598 | 316 | 391 | - | - | ||||||||||
| $ | 1,466 | $ | 1,234 | $ | 1,353 | $ | (53 | ) | $ | (40 | ) | ||||
(1) Includes key management compensation which is included in employee and director remuneration, mineral property interests, and corporate development.
As of December 31, 2025, Sun Valley owned 48% common shares of the Company. During the year ended December 31, 2025, the Company received from and provided to Sun Valley corporate and technical related services. The Company incurred CAD$35,000 (2024 - CAD$155,000) in expenses and charged CAD$75,000 (2024 - CAD$56,000) to Sun Valley for services and reimbursements. The 2024 and 2025 amounts are outstanding at year end December 31, 2025, for a net amount of CAD$59,000 due to Sun Valley.
In March 2024, Sun Valley participated in the financing offering of the Company and acquired 15,700,000 shares of the Company. In 2025, Sun Valley participated in the March 2025 financing, acquiring 4,600,000 shares of the Company and in the August 2025 financings acquiring 4,889,684 shares of the Company. In 2026, Sun Valley participated in the February 2026 private placements and acquired a total of 9,698,285 shares.
1.10 Proposed Transactions
There are no proposed material asset or business acquisitions or dispositions, other than those in the ordinary course of business and other than those already disclosed in this MD&A, before the board of directors for consideration, and other than those already disclosed in its regulatory and public filings.
1.11 Critical Accounting Estimates and Judgements
The preparation of financial statements in accordance with IFRS Accounting Standards requires management to make estimates, assumptions and judgements that affect the application of accounting policies and the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements along with the reported amounts of revenues and expenses during the period. Actual results may differ from these estimates and, as such, estimates and judgements and underlying assumptions are reviewed on an ongoing basis. Revisions are recognized in the period in which the estimates are revised and in any future periods affected.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
Significant areas requiring the use of management estimates relate to determining the recoverability of mineral property interests and receivables; valuation of certain marketable securities; accrued site remediation; amount of flow-through obligations; recognition of deferred income tax liability; the variables used in the determination of the fair value of stock options granted and finder's fees warrants issued or modified; and the recoverability of deferred tax assets. While management believes the estimates are reasonable, actual results could differ from those estimates and could impact future results of operations and cash flows.
The Company applies judgment in assessing the functional currency of each entity consolidated in the financial statements.
For right of use assets and lease liability, the Company applies judgement in determining whether the contract contains an identified asset, whether they have the right to control the asset, and the lease term. The lease term is based on considering facts and circumstances, both qualitative and quantitative, that can create an economic incentive to exercise renewal options. Management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option.
The Company applies judgment in assessing whether material uncertainties exist that would cast substantial doubt as to whether the Company could continue as a going concern.
Acquisition costs of mineral properties and exploration and development expenditures incurred thereto are capitalized and deferred. The costs related to a property from which there is production will be amortized using the unit-of-production method. Capitalized costs are written down to their estimated recoverable amount if the property is subsequently determined to be uneconomic. The amounts shown for mineral property interests represent costs incurred to date, less recoveries and write-downs, and do not reflect present or future values.
At the end of each reporting period, the Company assesses each of its mineral properties to determine whether any indication of impairment exists. Judgment is required in determining whether indicators of impairment exist, including factors such as: the period for which the Company has the right to explore; expected renewals of exploration rights; whether substantive expenditures on further exploration and evaluation of resource properties are budgeted or planned; and results of exploration and evaluation activities on the exploration and evaluation assets. If such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment, if any. The recoverable amount is the higher of fair value less costs to sell and value in use. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount and the impairment loss is recognized in profit or loss for the period.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but to an amount that does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior periods. A reversal of an impairment loss is recognized immediately in profit or loss.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.12 Changes in Accounting Policies including Initial Adoption
New Accounting Pronouncements
The Company did not early adopt any recent pronouncements disclosed in Note 3, of the audited consolidated financial statements for the year ended December 31, 2025.
1.13 Financial Instruments and Other Instruments
IFRS 9 Financial Instruments:
The Company has classified its financial instruments under IFRS 9 Financial Instruments ("IFRS 9") as follows:
| IFRS 9 | |
| Financial Assets | |
| Cash | Amortized Cost |
| Marketable securities | FVTPL |
| Receivables | Amortized cost |
| Financial Liability | |
| Accounts payable and accrued liabilities | Amortized cost |
| Lease liability | Amortized cost |
Management of Financial Risk
The Company is exposed in varying degrees to a variety of financial instrument related risks, including credit risk, liquidity risk, and market risk which includes foreign currency risk, interest rate risk and other price risk. The types of risk exposure and the way in which such exposure is managed are provided as follows.
The fair value hierarchy categorizes financial instruments measured at fair value at one of three levels according to the reliability of the inputs used to estimate fair values. The fair values of assets and liabilities included in Level 1 are determined by reference to quoted prices in active markets for identical assets and liabilities. Assets and liabilities in Level 2 are valued using inputs other than quoted prices for which all significant inputs are based on observable market data. Level 3 valuations are based on inputs that are not based on observable market data.
The fair values of the Company's receivables, accounts payable and accrued liabilities, approximate their carrying values due to the short terms to maturity. Cash and certain marketable securities are measured at fair values using Level 1 inputs. Certain other marketable securities are measured using Level 3 of the fair value hierarchy. The fair value of deferred royalty and lease liabilities approximate their carrying values as they are at estimated market interest rates using Level 2 inputs.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
(a) Credit risk:
Credit risk is the risk of potential loss to the Company if the counterparty to a financial instrument fails to meet its contractual obligations.
The Company's credit risk is primarily attributable to its liquid financial assets including cash. The Company limits exposure to credit risk on liquid financial assets through maintaining its cash with high-credit quality Canadian financial institutions.
To reduce credit risk, the Company regularly reviews the collectability of its amounts receivable, which may include amounts receivable from certain related parties, and records an expected credit loss based on its best estimate of potentially uncollectible amounts. Management believes that the credit risk with respect to these financial instruments is remote.
The financial instruments that potentially subject the Company to credit risk comprise investments, cash and cash equivalents and certain amounts receivable, the carrying value of which represents the Company's maximum exposure to credit risk.
(b) Liquidity risk:
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due.
The Company ensures that there is sufficient capital in order to meet short-term business requirements, after taking into account the Company's holdings of cash and its ability to raise equity financings. As at December 31, 2025, the Company had a working capital deficit (current assets less current liabilities) of $232,000 (December 31, 2024 - working capital surplus of $151,000. In February 2026, the Company raised CAD$9.2 million and has sufficient funding to meet its short-term liabilities, flow-through obligations and administrative overhead costs, and to maintain its mineral property interests in 2026.
(c) Market risk:
The significant market risk exposures to which the Company is exposed are foreign currency risk, interest rate risk and other price risk.
(i) Foreign currency risk:
Certain of the Company's mineral property interests and operations are in Canada. Most of its operating expenses are incurred in Canadian dollars. Fluctuations in the Canadian dollar would affect the Company's consolidated statements comprehensive income (loss) as its functional currency is the Canadian dollar, and fluctuations in the U.S. dollar would impact its cumulative translation adjustment as consolidated financial statements are presented in U.S. dollars.
The Company is exposed to currency risk for its U.S. dollar equivalent of assets and liabilities denominated in currencies other than U.S. dollars as follows:
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
| December 31, | ||||||
| 2025 | 2024 | |||||
| Cash | $ | 797 | $ | 589 | ||
| Marketable securities | 16 | 218 | ||||
| Receivables and prepaids | 173 | 247 | ||||
| Accounts payable and accrued liabilities | (1,129 | ) | (828 | ) | ||
| Lease liability | (102 | ) | (150 | ) | ||
| Deferred compensation liability | (856 | ) | (422 | ) | ||
| Net financial assets (liabilities) | $ | (1,101 | ) | $ | (346 | ) |
Based upon the above net exposure as at December 31, 2025 and assuming all other variables remain constant, a 10% (2024 - 10%) depreciation or appreciation of the U.S. dollar relative to the Canadian dollar could result in a decrease (increase) of approximately $110,000 (2024 - $35,000) in the cumulative translation adjustment in the Company's shareholders' equity.
The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time.
(ii) Interest rate risk:
In respect of financial assets, the Company's policy is to invest cash at floating rates of interest in cash equivalents, in order to maintain liquidity, while achieving a satisfactory return. Fluctuations in interest rates impact on the value of cash equivalents. Interest rate risk is not significant to the Company as it has no interest bearing debt.
(iii) Other price risk:
Other price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices.
The Company's other price risk includes equity price risk, whereby investments in marketable securities are held for trading financial assets with fluctuations in quoted market prices recorded at FVTPL. There is no separately quoted market value for the Company's investments in the shares of certain investments.
As certain of the Company's marketable securities are carried at market value and are directly affected by fluctuations in value of the underlying securities, the Company considers its financial performance and cash flows could be materially affected by such changes in the future value of the Company's marketable securities. Based upon the net exposure as at December 31, 2025 and assuming all other variables remain constant, a net increase or decrease of 10% in the market prices of the underlying securities would increase or decrease respectively net (loss) income by $1,600 (2024 - $22,000).
1.14. Other MD&A Requirements
1.14.1 Additional information
Additional information relating to the Company are as follows:
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
(a) may be found on SEDAR+ at www.sedarplus.ca;
(b) may be found in the Company's annual information form; and
(c) is also provided in the Company's audited consolidated financial statements for the year ended December 31, 2025, 2024 and 2023.
1.14.2 Outstanding Share Data
The following table presents an updated share data as of March 31, 2026.
| Common Shares: | ||||
| Common shares outstanding at December 31, 2025 | 193,965,699 | |||
| Conversion of RSU to shares in January 2026 | 587,497 | |||
| Private placements in February 2026 | 19,396,570 | |||
| Common shares outstanding at March 31, 2026 | 213,949,766 | |||
| Stock Options | ||||
| Stock options outstanding at December 31, 2025 and March 31, 2026 | 800,000 | |||
| Warrants: | ||||
| Warrants outstanding at December 31, 2025 and March 31, 2026 | - | |||
| Deferred share units (DSUs): | ||||
| DSUs outstanding at December 31, 2025 and March 31, 2026 | 2,607,937 | |||
| Restricted share units (RSUs): | ||||
| RSUs outstanding at December 31, 2025 | 587,497 | |||
| Conversion of RSU to shares in January 2026 | (587,497 | ) | ||
| RSUs issued in March 2026 | 462,128 | |||
| RSUs outstanding at March 31, 2026 | 462,128 | |||
1.15 Outlook
The Company expects to continue to depend upon equity financings to continue exploration work on and to advance its mineral property interests, and to meet its administrative overhead costs for the 2026 fiscal year and beyond. There are no assurances that capital requirements will be met by this means of financing as inherent risks are attached therein including commodity prices, financial market conditions, and general economic factors. The Company does not expect to realize any operating revenues from its properties in the foreseeable future.
| CANAGOLD RESOURCES LTD. Management’s Discussion and Analysis For the year ended December 31, 2025 (expressed in United States dollars) |
1.16 Risk Factors
Mineral exploration, development and operation involves a number of risks and uncertainties, many of which are beyond the Company's control. These risks and uncertainties include, without limitation, the risks discussed elsewhere in this MD&A and those identified in the Company's Annual Information Form dated March 31, 2026 for the year ended December 31, 2025 and which was filed on SEDAR + on March 31, 2026, and the Company's other disclosure documents as filed in Canada on SEDAR + at www.sedarplus.ca.
1.17 Internal Controls over Financial Reporting
The Company's management, under the supervision of the Chief Executive Officer and the Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting ("ICOFR"). Except as noted below, our ICOFR is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS Accounting Standards. Management of the Company recognizes that any controls and procedures, no matter how well conceived and operated, have inherent limitations. As a result, even those systems designed to be effective can only provide reasonable assurance, and not absolute assurance, of achieving the desired control objectives, and management necessarily was required to apply its judgement in evaluating the cost-benefit relationship of possible controls and procedures.
In common with many other smaller companies, the Company has insufficient resources to appropriately review increasingly complex areas of accounting such as those in relation to deferred income tax and share based compensation expenses. To remedy this deficiency in its ICOFR, the Company shall engage the services of an external accounting firm to assist in applying complex areas of accounting as and when needed.
Management performed an assessment of the Company's ICOFR as at December 31, 2025. Based upon the results of that assessment as at December 31, 2025, management concluded that its internal control over financial reporting is effective.
Changes in Internal Controls over Financial Reporting
Except as disclosed above, there have been no changes in our internal control over financial reporting during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our ICOFR.
CANAGOLD RESOURCES LTD.
Consolidated Financial Statements
(expressed in United States dollars)
Years ended December 31, 2025, 2024 and 2023
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Directors of
Canagold Resources Ltd.
Opinion on the consolidated Financial Statements
We have audited the accompanying consolidated statements of financial position of Canagold Resources Ltd. (the “Company”), as of December 31, 2025 and 2024, and the related consolidated statements of comprehensive loss, changes in shareholders’ equity, and cash flows for the years ended December 31, 2025, 2024, and 2023 and the related notes and schedules (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years ended December 31, 2025, 2024, and 2023, in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board (IFRS Accounting Standards).
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatements of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Assessment of Impairment Indicators of Mineral Property
As described in Note 7 to the financial statements, the carrying amount of the Company’s mineral property interests was $37,282,000 as of December 31, 2025. As more fully described in Notes 2 and 3 to the financial statements, management assesses its mineral property interest for indicators of impairment at each reporting period or when events or changes in circumstances indicate that the carrying amount may not be recoverable.
The principal considerations for our determination that the assessment of impairment indicators of the Company’s mineral property interest is a critical audit matter are that there was judgment made by management when assessing whether there were indicators of impairment for the mineral property, specifically relating to the assets’ carrying amount which is impacted by the Company’s intent and ability to continue to explore and evaluate its asset. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate audit evidence relating to the judgments made by management in their assessment of indicators of impairment that could give rise to the requirement to prepare an estimate of the recoverable amount of the mineral property.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the financial statements. Our audit procedures included, among others:
Obtaining and assessing management’s impairment analysis.
- Evaluating the intent for the mineral property through discussion and communication with management.
- Reviewing the Company’s recent expenditure activity and expenditure budgets for future periods.
- Obtaining, on a test basis through government websites, confirmation of title to ensure mineral rights underlying the mineral property interest are in good standing.
We have served as the Company’s auditor since 2023.
/s/ DAVIDSON & COMPANY LLP
| Chartered Professional Accountants | Vancouver, Canada |
March 31, 2026
| CANAGOLD RESOURCES LTD. Consolidated Statements of Financial Position (expressed in thousands of United States dollars) |
| December 31, | |||||||
| Notes | 2025 | 2024 | |||||
| ASSETS | |||||||
| CURRENT ASSETS | |||||||
| Cash | $ | 820 | $ | 676 | |||
| Marketable securities | 6 | 16 | 218 | ||||
| Receivables and prepaids | 15 | 175 | 247 | ||||
| Total Current Assets | 1,011 | 1,141 | |||||
| NON-CURRENT ASSETS | |||||||
| Mineral property interests | 7 | 37,282 | 31,300 | ||||
| Mineral property deposits | 1 | 107 | |||||
| Equipment | 8 | 129 | 197 | ||||
| Total Non-Current Assets | 37,412 | 31,604 | |||||
| Total Assets | $ | 38,423 | $ | 32,745 | |||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
| CURRENT LIABILITIES | |||||||
| Accounts payable and accrued liabilities | 12 | $ | 1,129 | $ | 928 | ||
| Flow through premium liability | 9(a) | 52 | - | ||||
| Lease liability, current | 9(c) | 62 | 62 | ||||
| Total Current Liabilities | 1,243 | 990 | |||||
| LONG TERM LIABILITIES | |||||||
| Deferred compensation liability | 10(c) | 856 | 422 | ||||
| Lease liability, long term | 9(c) | 40 | 88 | ||||
| Deferred income tax liability | 15 | 2,311 | 1,265 | ||||
| Total Long Term Liabilities | 3,207 | 1,775 | |||||
| Total Liabilities | 4,450 | 2,765 | |||||
| SHAREHOLDERS' EQUITY | |||||||
| Share capital | 10(b) | 96,659 | 91,688 | ||||
| Reserve for share-based payments | 635 | 593 | |||||
| Accumulated other comprehensive loss | (4,109 | ) | (5,669 | ) | |||
| Deficit | (59,212 | ) | (56,632 | ) | |||
| Total Shareholders' Equity | 33,973 | 29,980 | |||||
| Total Liabilities and Shareholders' Equity | $ | 38,423 | $ | 32,745 | |||
Nature of operations and going concern (Note 1)
Subsequent events (Note 16)
Commitment (Note 14)
Refer to the accompanying notes to the consolidated financial statements.
Approved on behalf of the Board:
| /s/ Sofia Bianchi | /s/ Andrew Trow | |
| Director | Director |
| CANAGOLD RESOURCES LTD. Consolidated Statements of Comprehensive Loss (expressed in thousands of United States dollars) |
| Years ended December 31, | ||||||||||
| Notes | 2025 | 2024 | 2023 | |||||||
| Expenses: | ||||||||||
| Amortization | 8 | $ | 76 | $ | 81 | $ | 89 | |||
| Corporate development | 11 and 12 | 127 | 126 | 152 | ||||||
| Employee and director remuneration | 12 | 451 | 475 | 598 | ||||||
| General and administrative | 11 | 478 | 458 | 403 | ||||||
| Share-based payments | 10(c) and 12 | 551 | 316 | 391 | ||||||
| Operating loss | (1,683 | ) | (1,456 | ) | (1,633 | ) | ||||
| Interest and other income | 38 | 148 | 65 | |||||||
| Foreign exchange (loss) gain | (19 | ) | 71 | 36 | ||||||
| Change in fair value of marketable securities | 6 | (97 | ) | (143 | ) | (364 | ) | |||
| Gain on sale of long term investments | 7(b)(i) | - | - | 738 | ||||||
| Impairment of mineral property interest | 7(a)(ii) and 7(b)(ii) | - | - | (1,898 | ) | |||||
| Mineral property option income | 7(a) and (b) | 12 | 12 | 12 | ||||||
| Interest and finance charges | 9(b) and 9(c) | (9 | ) | (12 | ) | (38 | ) | |||
| Net loss before income tax | (1,758 | ) | (1,380 | ) | (3,082 | ) | ||||
| Income tax recovery | 9(a) | 148 | 258 | 32 | ||||||
| Deferred income tax expense | 15(a) | (983 | ) | - | - | |||||
| Net loss for the year | (2,593 | ) | (1,122 | ) | (3,050 | ) | ||||
| Other comprehensive income (loss): | ||||||||||
| Item that will or may be reclassified to profit or loss: | ||||||||||
| Foreign currency translation adjustment | 1,560 | (2,499 | ) | 820 | ||||||
| Comprehensive loss for the year | $ | (1,033 | ) | $ | (3,621 | ) | $ | (2,230 | ) | |
| Basic and diluted loss per share | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) | |
| Weighted average number of common shares outstanding - Basic and Diluted | 186,021,413 | 170,349,397 | 145,864,736 | |||||||
Refer to the accompanying notes to the consolidated financial statements.
| CANAGOLD RESOURCES LTD. Consolidated Statements of Changes in Shareholders’ Equity (expressed in thousands of United States dollars, except per share amounts) |
| Accumulated | ||||||||||||||||||
| Share Capital | Reserve for | Other | ||||||||||||||||
| Number of | Share-Based | Comprehensive | ||||||||||||||||
| Shares | Amount | Payments | Income (Loss) | Deficit | Total | |||||||||||||
| Balance, December 31, 2022 | 136,889,394 | 85,465 | 815 | (3,990 | ) | (52,777 | ) | 29,513 | ||||||||||
| Private placement | 21,000,000 | 3,315 | - | - | - | 3,315 | ||||||||||||
| Share issuance expense | - | (12 | ) | - | - | - | (12 | ) | ||||||||||
| Share based payments | - | - | 152 | - | - | 152 | ||||||||||||
| Cancellation and expiration of stock options | - | - | (311 | ) | - | 311 | - | |||||||||||
| Comprehensive income (loss) for the year | - | - | - | 820 | (3,050 | ) | (2,230 | ) | ||||||||||
| Balance, December 31, 2023 | 157,889,394 | 88,768 | 656 | (3,170 | ) | (55,516 | ) | 30,738 | ||||||||||
| Private placement | 15,700,000 | 2,781 | - | - | - | 2,781 | ||||||||||||
| Conversion of RSUs to shares | 906,302 | 165 | (165 | ) | - | - | - | |||||||||||
| Share issuance expense | - | (26 | ) | - | - | - | (26 | ) | ||||||||||
| Share based payments | - | - | 108 | - | - | 108 | ||||||||||||
| Expiration of stock options | - | - | (6 | ) | - | 6 | - | |||||||||||
| Comprehensive loss for the year | - | - | - | (2,499 | ) | (1,122 | ) | (3,621 | ) | |||||||||
| Balance, December 31, 2024 | 174,495,696 | $ | 91,688 | $ | 593 | $ | (5,669 | ) | $ | (56,632 | ) | $ | 29,980 | |||||
| Private placement | 18,979,368 | 4,921 | - | - | - | 4,921 | ||||||||||||
| Conversion of RSUs to shares | 490,635 | 91 | (91 | ) | - | - | 0 | |||||||||||
| Share issuance expense | - | (41 | ) | - | - | - | (41 | ) | ||||||||||
| Share based payments | - | - | 146 | - | - | 146 | ||||||||||||
| Expiration of stock options | - | - | (13 | ) | - | 13 | - | |||||||||||
| Comprehensive loss for the year | - | - | - | 1,560 | (2,593 | ) | (1,033 | ) | ||||||||||
| Balance, December 31, 2025 | 193,965,699 | $ | 96,659 | $ | 635 | $ | (4,109 | ) | $ | (59,212 | ) | $ | 33,973 | |||||
Refer to the accompanying notes to the consolidated financial statements.
| CANAGOLD RESOURCES LTD. Consolidated Statements of Cash Flows (expressed in thousands of United States dollars) |
| Years ended December 31, | ||||||||||
| Notes | 2025 | 2024 | 2023 | |||||||
| Cash provided from (used by): | ||||||||||
| Operations: | ||||||||||
| Net loss | $ | (2,593 | ) | $ | (1,122 | ) | $ | (3,050 | ) | |
| Items not involving cash: | ||||||||||
| Accrued interest | 9(c) | 9 | 12 | 38 | ||||||
| Amortization | 8 | 76 | 81 | 89 | ||||||
| Share-based payments | 551 | 316 | 391 | |||||||
| Change in fair value of marketable securities | 97 | 143 | 364 | |||||||
| Income tax recovery | 9(a) | (148 | ) | (258 | ) | (34 | ) | |||
| Deferred tax expense | 15(a) | 983 | - | - | ||||||
| Gain on long term investment | - | - | (738 | ) | ||||||
| Write-off of mineral property interest | 7(a)(ii) and 7(b)(ii) | - | - | 1,898 | ||||||
| Unrealized foreign exchange cash | - | - | (32 | ) | ||||||
| (1,025 | ) | (828 | ) | (1,074 | ) | |||||
| Changes in non-cash working capital items: | ||||||||||
| Receivables and prepaids | 195 | 662 | 221 | |||||||
| Accounts payable and accrued liabilities | 13 | (198 | ) | (880 | ) | |||||
| Net cash used by operating activities | (817 | ) | (364 | ) | (1,733 | ) | ||||
| Financing: | ||||||||||
| Issuance of common shares, net of share issuance costs | 5,079 | 3,016 | 3,303 | |||||||
| Lease payments | (62 | ) | (62 | ) | (63 | ) | ||||
| Cash provided from financing activities | 5,017 | 2,954 | 3,240 | |||||||
| Investing: | ||||||||||
| Proceeds from disposition of marketable securities | 111 | 1,110 | 159 | |||||||
| Sale of long term investments | - | - | 1,600 | |||||||
| Expenditures for mineral properties, net of recoveries | (4,276 | ) | (5,670 | ) | (4,542 | ) | ||||
| Expenditures for leasehold improvements and equipment | - | - | (5 | ) | ||||||
| Cash used by investing activities | (4,165 | ) | (4,560 | ) | (2,788 | ) | ||||
| Unrealized foreign exchange gain (loss) on cash | 109 | (165 | ) | 267 | ||||||
| (Decrease) increase in cash | 143 | (2,135 | ) | (1,014 | ) | |||||
| Cash, beginning of year | 676 | 2,811 | 3,825 | |||||||
| Cash and cash equivalents, end of year | $ | 820 | $ | 676 | $ | 2,811 | ||||
Refer to the accompanying notes to the consolidated financial statements.
| CANAGOLD RESOURCES LTD. Consolidated Statements of Cash Flows (expressed in thousands of United States dollars) |
| Years ended December 31, | |||||||||
| 2025 | 2024 | 2023 | |||||||
| Non-cash financing and investing activities: | |||||||||
| Fair value of marketable securities received from option on mineral property interests | $ | $ | - | $ | 1,192 | ||||
| Expiration of stock options | 13 | 6 | 311 | ||||||
| Conversion of RSUs to shares | 91 | 165 | - | ||||||
| Mineral property costs included in accounts payable | 915 | 783 | 498 | ||||||
| Income taxes paid | 5 | 36 | - | ||||||
| Interest paid | - | - | - | ||||||
Refer to the accompanying notes to the consolidated financial statements.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
1. Nature of Operations and Going Concern
Canagold Resources Ltd. (the "Company"), a company incorporated under the laws of British Columbia on January 22, 1987, is in the mineral exploration business and has not yet determined whether its mineral property interests contain reserves. The recoverability of amounts capitalized for mineral property interests is dependent upon the existence of reserves in its mineral property interests, the ability of the Company to arrange appropriate financing and receive necessary permitting for the exploration and development of its mineral property interests, and upon future profitable production or proceeds from the disposition thereof. The address of the Company's registered office is #1500 - 1055 West Georgia Street, Vancouver, BC, Canada, V6E 4N7 and its principal place of business is #1250 - 625 Howe Street, Vancouver, BC, Canada, V6C 2T6.
The Company has no operating revenues, has incurred a significant net loss of $2.6 million in 2025 (2024 - $1.1 million, 2023 - $3.1 million) and has a deficit of $59.2 million as at December 31, 2025 (2024 - $56.6 million). In addition, the Company has negative cash flows from operations. These consolidated financial statements have been prepared on a going concern basis, which assumes the realization of assets and repayment of liabilities in the normal course of business. The Company's ability to continue as a going concern is dependent on the ability of the Company to raise debt or equity financings, and the attainment of profitable operations. Management continues to find opportunities to raise the necessary capital to meet its planned business objectives and continues to seek financing opportunities. There can be no assurance that management's plans will be successful. These matters indicate the existence of material uncertainties that may cast substantial doubt about the Company's ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern, and such adjustments could be material.
2. Basis of Presentation
(a) Statement of compliance:
These consolidated financial statements have been prepared in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board.
(b) Approval of consolidated financial statements:
These consolidated financial statements were approved by the Company's Board of Directors on March 31, 2026.
(c) Basis of presentation:
These consolidated financial statements have been prepared on a historical cost basis except for certain financial instruments which are measured at fair value, as disclosed in Note 5. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting, except for cash flow information.
(d) Functional currency and presentation currency:
The functional currency of the Company and its subsidiaries is the Canadian dollar, and accounts denominated in currencies other than the Canadian dollar have been translated as follows:
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
2. Basis of Presentation (continued)
(d) Functional currency and presentation currency: (continued)
• Monetary assets and liabilities at the exchange rate at the consolidated statement of financial position date;
• Non-monetary assets and liabilities at the historical exchange rates, unless such items are carried at fair value, in which case they are translated at the date when the fair value was determined;
• Shareholders' equity items at historical exchange rates; and
• Revenue and expense items at the rate of exchange on the transaction date.
The Company's presentation currency is the United States dollar. For presentation purposes, all amounts are translated from the Canadian dollar functional currency to the United States dollar presentation currency for each period. Statement of financial position accounts, with the exception of equity, are translated using the exchange rate at the end of each reporting period, transactions on the statement of comprehensive loss are recorded at the average rate of exchange during the period, and equity accounts are translated using historical actual exchange rates.
Exchange gains and losses arising from translation to the Company's presentation currency are recorded as a cumulative translation adjustment in other comprehensive income (loss), which is included in accumulated other comprehensive loss.
(e) Critical accounting estimates and judgments:
The preparation of the consolidated financial statements in accordance with IFRS Accounting Standards requires management to make estimates, assumptions and judgments that affect the application of accounting policies and the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements along with the reported amounts of revenues and expenses during the period. Actual results may differ from these estimates and, as such, estimates and judgments and underlying assumptions are reviewed on an ongoing basis. Revisions are recognized in the period in which the estimates are revised and in any future periods affected.
Significant areas requiring the use of management estimates relate to determining the recoverability of mineral property interests and receivables and the variables used in the determination of the fair value of stock based compensation granted. While management believes the estimates are reasonable, actual results could differ from those estimates and could impact future results of operations and cash flows.
The Company applies judgment in assessing the functional currency of each entity consolidated in these consolidated financial statements. The functional currency of the Company and its subsidiaries is determined using the currency of the primary economic environment in which that entity operates.
For right of use assets and lease liability, the Company applies judgment in determining whether the contract contains an identified asset, whether they have the right to control the asset, and the lease term. The lease term is based on considering facts and circumstances, both qualitative and quantitative, that can create an economic incentive to exercise renewal options. Management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option.
The Company applies judgment in assessing whether material uncertainties exist that would cast substantial doubt as to whether the Company could continue as a going concern.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
2. Basis of Presentation (continued)
(e) Critical accounting estimates and judgments: (continued)
The Company is required to spend proceeds received from the issuance of flow-through shares on qualifying resources expenditures. The Company is also entitled to refundable mining tax credits on qualified resource expenditures incurred in Canada. Differences in judgment between management and regulatory authorities with respect to qualified expenditures may result in disallowed expenditures by the tax authorities. Any amount disallowed may result in the Company's required expenditures not being fulfilled or refundable tax credits not being recoverable. The Company accrues for refundable mining tax credits when management is reasonably assured that the amount is collectable.
At the end of each reporting period, the Company assesses each of its mineral resource properties to determine whether any indication of impairment exists. Judgment is required in determining whether indicators of impairment exist, including factors such as: the period for which the Company has the right to explore; expected renewals of exploration rights; whether substantive expenditures on further exploration and evaluation of resource properties are budgeted or planned; and results of exploration and evaluation activities on the exploration and evaluation assets.
3. Material Accounting Policy Information
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements.
(a) Basis of consolidation:
These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries including New Polaris Gold Mines Ltd. (Canada), AIM U.S Holdings Corporation (USA), American Innovative Minerals LLC ("AIM") (USA), Fondaway LLC (USA), and Canarc (Barbados) Mining Ltd (inactive) (Barbados). The financial statements of subsidiaries are included in the consolidated financial statements from the date control commences until the date control ceases. All significant intercompany transactions and balances are eliminated on consolidation.
Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(b) Financial instruments:
(i) Financial assets:
Initial recognition and measurement
A financial asset is measured initially at fair value plus, for an item not at fair value through profit or loss, transaction costs that are directly attributable to its acquisition or issue. On initial recognition, a financial asset is classified as measured at amortized cost or fair value through profit or loss. A financial asset is measured at amortized cost if it meets the conditions that: (i) the asset is held within a business model whose objective is to hold assets to collect contractual cash flows; (ii) the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding; and (iii) is not designated as fair value through profit or loss.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at fair value through profit or loss
Financial assets measured at fair value through profit and loss are carried in the consolidated statements of financial position at fair value with changes in fair value therein, recognized in profit or loss. Associated transaction costs are recognized in profit or loss in the period in which it arises.
Financial assets measured at amortized cost
A financial asset is subsequently measured at amortized cost, using the effective interest method.
Financial assets at fair value through other comprehensive income ("FVTOCI")
Financial assets carried at FVTOCI are initially recorded at fair value. Unrealized gains and losses arising from changes in the fair value of the financial assets held at FVTOCI are included in other comprehensive income or loss in the period in which they arise.
(ii) Derecognition:
A financial asset or, where applicable a part of a financial asset or part of a group of similar financial assets is derecognized when:
• The contractual rights to receive cash flows from the asset have expired; or
• The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either: (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(b) Financial instruments: (continued)
(iii) Financial liabilities:
Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the financial instrument. A financial liability is derecognized when it is extinguished, discharged, cancelled or when it expires. Financial liabilities are classified as either financial liabilities at fair value through profit or loss or financial liabilities subsequently measured at amortized cost. All interest-related charges are reported in profit or loss within interest expense, if applicable.
(iv) Fair value hierarchy
The Company categorizes financial instruments measured at fair value at one of three levels according to the reliability of the inputs used to estimate fair values. The fair value of financial assets and financial liabilities included in Level 1 are determined by reference to quoted prices in active markets for identical assets and liabilities. Financial assets and liabilities in Level 2 are valued using inputs other than quoted prices for which all significant inputs are based on observable market data. Level 3 valuations are based on inputs that are not based on observable market data.
(c) Impairment of non-financial assets:
The carrying amounts of non-current assets are tested for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If there are indicators of impairment, the recoverable amount of the asset is estimated in order to determine the extent of the impairment. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount and is recorded as an expense in profit or loss.
The recoverable amount is the higher of an asset's "fair value less costs to sell" for the asset's highest and best use, and "value-in-use". Where the asset does not generate cash flows that are independent from other assets, the recoverable amount of the cash-generating unit to which the asset belongs is determined. "Fair value less costs to sell" is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date less incremental costs directly attributable to disposal of the asset, excluding financing costs and income tax expenses. For mining assets this would generally be determined based on the present value of the estimated future cash flows arising from the continued development, use or eventual disposal of the asset. In assessing these cash flows and discounting them to the present value, assumptions used are those that an independent market participant would consider appropriate. In assessing "value-in-use", the estimated future cash flows expected to arise from the continuing use of the assets in their present form and from their disposal are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the asset.
For the purposes of impairment testing, mineral property interests are allocated to cash-generating units to which the exploration or development activity relates. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior periods. A reversal of an impairment loss is recognized immediately in profit or loss.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(d) Mineral property interest:
All costs related to investments in mineral property interests are capitalized on a property-by-property basis. Such costs include mineral property acquisition costs and exploration and development expenditures, net of any recoveries. The costs related to a mineral property from which there is production, together with the costs of mining equipment, will be amortized using the unit-of-production method. When there is little prospect of further work on a property being carried out by the Company or its partners or when a property is abandoned or when the capitalized costs are not considered to be economically recoverable, the related property costs are written down to the amount recoverable.
From time to time, the Company may acquire or dispose of a mineral property interest pursuant to the terms of a property option agreement. As the property options are exercisable entirely at the discretion of the optionee, the amounts payable or receivable are not recorded. Property option payments are recorded as property costs or recoveries when the payments are made or received. Proceeds received on the sale or property option of the Company's property interest is recorded as a reduction of the mineral property cost. The Company recognizes in income those costs that are recovered on mineral property interests when amounts received or receivable are in excess of the carrying amount.
The amounts shown for mineral property interests represent costs incurred to date and include advance net smelter return ("NSR") royalties, less recoveries and write-downs, and are not intended to reflect present or future values.
(e) Equipment:
Leasehold improvements, office equipment and furnishings, and right-of-use assets are recorded at cost, and are amortized as follows:
| Leasehold improvements | Straight line over lease term |
| Office equipment | Double declining rate of 30% |
| Office furnishings | Double declining rate of 20% |
| Right-of-use assets | Straight line over lease term |
Additions during the year are amortized on a pro-rated basis.
(f) Proceeds on unit offerings:
Proceeds received on the issuance of units, consisting of common shares and warrants, are first allocated to the fair value of the common shares with any residual value then allocated to warrants. Consideration received on the exercise of warrants is recorded as share capital and any related reserve for share-based payments is transferred to share capital.
(g) Non-monetary transactions:
Common shares issued for consideration other than cash are valued based on the fair market value of the goods or services received and if not determinable, the common shares are valued at their quoted market price at the date of issuance.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(h) Flow-through common shares:
The Company will, from time to time, issue flow-through common shares to finance a portion of its exploration program. Pursuant to the terms of the flow-through share agreements, these shares transfer the tax deductibility of qualifying resource expenditures to investors. On issuance, the Company bifurcates the flow-through shares into: (i) a flow-through share premium equal to the excess, if any, which investors pay for the flow-through common share over the market price of common shares on closing date and which is recognized as a liability; and (ii) share capital. Upon expenses being incurred, the Company derecognizes the liability and recognizes a deferred tax liability or tax recovery for the amount of tax reduction renounced to the shareholders.
Proceeds received from the issuance of flow-through shares are restricted to be used only for Canadian resource property exploration expenditures within a two-year period. The portion of the proceeds received but not yet expended at the end of the Company's period is disclosed separately as flow-through share proceeds.
The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced under the Look-back Rule, in accordance with the Government of Canada flow-through regulations. When applicable, this tax is accrued as a finance expense until paid.
(i) Share-based payments:
The Company has an Omnibus plan that is described in Note 10(c). Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair value of the goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The offset to the recorded cost is to the reserve for share-based payments. Consideration received on the exercise of stock options is recorded as share capital and the related reserve for share-based payments is transferred to share capital. Upon expiry, the recorded fair value is transferred from reserve for share-based payments to deficit.
The Company has a share appreciation rights plan, which provides stock option holders the right to receive the number of common shares that are equal in value to the intrinsic value of the stock options at the date of exercise. Amounts transferred from the reserve for share-based payment to share capital are based on the ratio of shares actually issued to the number of stock options originally granted. The remainder is transferred to deficit.
(j) Environmental rehabilitation:
The Company recognizes liabilities for statutory, contractual, constructive, or legal obligations associated with the retirement of mineral property interests and equipment, when those obligations result from the acquisition, construction, development, or normal operation of the assets. The net present value of future rehabilitation cost estimates arising from the decommissioning of plant and other site preparation work is capitalized to the related asset along with a corresponding increase in the rehabilitation provision in the period incurred. Discount rates using a pre-tax rate that reflect the time value of money are used to calculate the net present value. The rehabilitation asset is depreciated on the same basis as mining assets.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(j) Environmental rehabilitation: (continued)
The Company's estimates of reclamation costs could change as a result of changes in regulatory requirements, discount rates and assumptions regarding the amount and timing of the future expenditures. These changes are recorded directly to the related asset with a corresponding entry to the rehabilitation provision. The Company's estimates are reviewed annually for changes in regulatory requirements, discount rates, effects of inflation and changes in estimates.
Changes in the net present value, excluding changes in the Company's estimates of reclamation costs, are charged to profit or loss for the period. The net present value of restoration costs arising from subsequent site damage that is incurred on an ongoing basis during production are charged to profit or loss in the period incurred.
The costs of rehabilitating projects that were included in the rehabilitation provision are recorded against the provision as incurred. The cost of ongoing current programs to prevent and control pollution is charged against profit or loss as incurred.
(k) Earnings (loss) per share:
Basic earnings (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common shares outstanding during the period. The treasury stock method is used to calculate diluted earnings (loss) per common share amounts. Under the treasury stock method, the weighted average number of common shares outstanding used for the calculation of the diluted per common share amount assumes that the proceeds to be received on the exercise of dilutive share options and warrants are used to repurchase common shares at the average market price during the period. In the Company's case, diluted loss per share presented is the same as basic loss per share as the effect of outstanding options and warrants in the loss per common share calculation would be anti-dilutive.
(l) Provisions:
Provisions are recorded when a present legal or constructive obligation exists as a result of past events where it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the consolidated statement of financial position date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the amount receivable can be measured reliably.
(m) Income taxes:
The Company follows the asset and liability method for accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and losses carried forward. Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in profit or loss in the period that includes the substantive enactment date. Deferred tax assets are recognized to the extent that recovery is considered probable.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
3. Material Accounting Policy Information (continued)
(n) Right-of-use asset and lease liability:
The Company assesses whether a contract is or contains a lease, at inception of a contract. The Company recognizes a right-of-use asset ("ROU asset") and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, at the commencement of the lease, with the following exceptions:
(i) The Company has elected not to recognize ROU assets and liabilities for leases where the total lease term is less than or equal to 12 months; or
(ii) For leases of low value.
The payments for such leases are recognized in the consolidated statements of loss and comprehensive loss over the lease term.
The ROU asset is initially measured based on the present value of lease payments, lease payments made at or before the commencement day, and any initial direct costs. They are subsequently measured at cost less accumulated amortization and impairment losses. The ROU asset is depreciated over the shorter of the lease term or the useful life of the underlying asset. The ROU asset is subject to testing for impairment if there is an indicator of impairment.
The lease liability is initially measured at the present value of lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Company uses its incremental borrowing rate. Lease payments include fixed payments less any lease incentives and any variable lease payments where variability depends on an index or rate. When the lease contains an extension or purchase option that the Company considers reasonably certain to be exercised, the cost of the option is included in the lease payments.
Variable lease payments that do not depend on an index or rate are not included in the measurement of the ROU asset and lease liability. The related payments are recognized as an expense in the period in which the triggering event occurs and are included in the consolidated statements of loss and comprehensive loss.
(o) Mining exploration tax recoveries:
The Company recognizes mining exploration tax recoveries in the period in which there is reasonable expectation, based on management's estimate, of receiving a refund. The amount of refundable mining tax credits receivable is subject to review and approval by the taxation authorities and is adjusted for in the period when such approval is confirmed.
(p) Adoption of new accounting standards:
IFRS 18, issued by the IASB in April 2024, is a new standard on "Presentation and Disclosure in Financial Statements" that replaces IAS 1 and is effective from January 1, 2027, with earlier application permitted. The Company has not early adopted IFRS 18 and is currently assessing the impact of the adoption of this standard.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
4. Management of Capital
The Company is an exploration stage company and this involves a high degree of risk. The Company has not determined whether its mineral property interests contain reserves of ore and currently has not earned any revenues from its mineral property interests and, therefore, does not generate cash flows from operations. The Company's primary source of funds comes from the issuance of share capital and proceeds from debt. The Company has generated cash inflows from the disposition of marketable securities. The Company is not subject to any externally imposed capital requirements.
The Company defines its capital as debt and share capital. Capital requirements are driven by the Company's exploration activities on its mineral property interests. To effectively manage the Company's capital requirements, the Company has a planning and budgeting process in place to ensure that adequate funds are available to meet its strategic goals. The Company monitors actual expenses to budget on all exploration projects and overhead to manage costs, commitments and exploration activities.
The Company has in the past invested its capital in liquid investments to obtain adequate returns. The investment decision is based on cash management to ensure working capital is available to meet the Company's short-term obligations while maximizing liquidity and returns of unused capital.
Although the Company has been successful at raising funds in the past through the issuance of share capital, it is uncertain whether it will be able to continue this financing in the future. The Company will continue to rely on debt and equity financings to meet its commitments as they become due, to continue exploration work on its mineral property interests, and to meet its administrative overhead costs for the coming periods.
There were no changes in the Company's approach to capital management during the year ended December 31, 2025.
5. Management of Financial Risk
The Company has classified its financial instruments as follows:
| Financial Assets | |
| Cash | Amortized cost |
| Marketable securities | FVTPL |
| Receivables | Amortized cost |
| Financial Liability | |
| Accounts payable and accrued liabilities | Amortized cost |
| Lease liability | Amortized cost |
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
5. Management of Financial Risk (continued)
The fair values of the Company's cash, receivables and accounts payable and accrued liabilities approximate their carrying values due to the short terms to maturity. Certain marketable securities are measured at fair values using Level 1 inputs. Lease liabilities are measured at amortized cost. There were no transfers between levels 1, 2 or 3 during the years ended December 31, 2025 and 2024.
The Company is exposed in varying degrees to a variety of financial instrument related risks, including credit risk, liquidity risk and market risk which includes foreign currency risk, interest rate risk and other price risk. The types of risk exposure and the way in which such exposure is managed are provided as follows.
(a) Credit risk:
Credit risk is the risk of potential loss to the Company if the counterparty to a financial instrument fails to meet its contractual obligations.
The Company's credit risk is primarily attributable to its liquid financial assets including cash. The Company limits exposure to credit risk on liquid financial assets through maintaining its cash with high-credit quality Canadian financial institutions.
To reduce credit risk, the Company regularly reviews the collectability of its amounts receivable, which may include amounts receivable from certain related parties, and records an expected credit loss based on its best estimate of potentially uncollectible amounts. Management believes that the credit risk with respect to these financial instruments is remote.
The financial instruments that potentially subject the Company to credit risk comprise cash and certain receivables, the carrying value of which represents the Company's maximum exposure to credit risk.
(b) Liquidity risk:
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due.
The Company ensures that there is sufficient capital in order to meet short-term business requirements, after taking into account the Company's holdings of cash and its ability to raise equity financings. As at December 31, 2025, the Company had a negative working capital (current assets less current liabilities) of $232,000 (2024 - positive $151,000). Subsequent to year end, the Company completed a financing and has sufficient funding to meet its short-term liabilities and administrative overhead costs, and to maintain its mineral property interests in 2026. The Company will need additional funding to advance its projects on a long-term basis.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
5. Management of Financial Risk (continued)
(b) Liquidity risk: (continued)
The following schedule provides the contractual obligations related to the lease liability payments (Notes 9(c)) as at December 31, 2025 and 2024:
| Payments due by Period | |||||||||||||||
| (CAD$000) | |||||||||||||||
| Less than | 3-5 | After | |||||||||||||
| Total | 1 year | 1-3 years | years | 5 years | |||||||||||
| Basic office lease | $ | 148 | $ | 88 | $ | 60 | $ | - | $ | - | |||||
| Total,December 31, 2025 | $ | 148 | $ | 88 | $ | 60 | $ | - | $ | - | |||||
| Basic office lease | $ | 235 | $ | 87 | $ | 148 | $ | - | $ | - | |||||
| Total,December 31, 2024 | $ | 235 | $ | 87 | $ | 148 | $ | - | $ | - | |||||
Accounts payable and accrued liabilities are due in less than 90 days.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
5. Management of Financial Risk (continued)
(c) Market risk:
The significant market risk exposures to which the Company is exposed are foreign currency risk, interest rate risk and other price risk.
(i) Foreign currency risk:
Certain of the Company's mineral property interests and operations are in Canada. Most of its operating expenses are incurred in Canadian dollars. Fluctuations in the Canadian dollar would affect the Company's consolidated statements of comprehensive loss as its functional currency is the Canadian dollar, and fluctuations in the U.S. dollar would impact its cumulative translation adjustment as its consolidated financial statements are presented in U.S. dollars.
The Company is exposed to currency risk for its U.S. dollar equivalent of assets and liabilities denominated in currencies other than U.S. dollars as follows:
| December 31, | ||||||
| 2025 | 2024 | |||||
| Cash | $ | 797 | $ | 589 | ||
| Marketable securities | 16 | 218 | ||||
| Receivables and prepaids | 173 | 247 | ||||
| Accounts payable and accrued liabilities | (1,129 | ) | (828 | ) | ||
| Lease liability | (102 | ) | (150 | ) | ||
| Deferred compensation liability | (856 | ) | (422 | ) | ||
| Net financial assets (liabilities) | $ | (1,101 | ) | $ | (346 | ) |
Based upon the above net exposure as at December 31, 2025 and assuming all other variables remain constant, a 10% (2024 - 10%) depreciation or appreciation of the U.S. dollar relative to the Canadian dollar could result in a decrease (increase) of approximately $110,000 (2024 - $35,000) in the cumulative translation adjustment in the Company's shareholders' equity.
The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time.
| CANAGOLD RESOURCES LTD. |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
5. Management of Financial Risk (continued)
(c) Market risk: (continued)
(ii) Interest rate risk:
In respect of financial assets, the Company's policy is to invest excess cash at floating rates of interest in cash equivalents, in order to maintain liquidity, while achieving a satisfactory return. Fluctuations in interest rates impact on the value of cash equivalents. The Company's investments in guaranteed investment certificates bear a fixed rate and are cashable at any time prior to maturity date. Interest rate risk is not significant to the Company as it has no interest-bearing debt at year-end.
(iii) Other price risk:
Other price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices.
The Company's other price risk includes equity price risk, whereby investment in marketable securities are held for trading financial assets with fluctuations in quoted market prices recorded at FVTPL.
As certain of the Company's marketable securities are carried at market value and are directly affected by fluctuations in value of the underlying securities, the Company considers its financial performance and cash flows could be materially affected by such changes in the future value of the Company's marketable securities. Based upon the net exposure as at December 31, 2025 and assuming all other variables remain constant, a net increase or decrease of 10% in the market prices of the underlying securities would increase or decrease respectively net (loss) income by $1,600 (2024 - $22,000).
6. Marketable Securities
| December 31, | December 31, | |||||
| 2025 | 2024 | |||||
| Balance, beginning of year | $ | 218 | $ | 1,534 | ||
| Proceeds from disposition of marketable securities at fair value | (111 | ) | (1,110 | ) | ||
| Change in fair value of marketable securities | (97 | ) | (143 | ) | ||
| Foreign currency translation adjustment | 6 | (63 | ) | |||
| Balance, end of year | $ | 16 | $ | 218 |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest
| Canada | |||
| British Columbia | |||
| New Polaris | |||
| (Note 7(a)(i)) | |||
| Acquisition Costs: | |||
| Balance, December 31, 2024 | $ | 3,921 | |
| Acquisition | 12 | ||
| Foreign currency translation adjustment | 10 | ||
| Balance, December 31, 2025 | 3,943 | ||
| Deferred Exploration Expenditures: | |||
| Balance, December 31, 2024 | 27,379 | ||
| Additions: | |||
| Exploration: | |||
| Assays and sampling | 5 | ||
| Community engagement and social | 716 | ||
| Drilling | 48 | ||
| Environmental | 2,639 | ||
| Feasibility | 531 | ||
| General, administrative, sundry | 6 | ||
| Metallurgy | 28 | ||
| Rental and storage | 31 | ||
| Royalties | 7 | ||
| Salaries | 350 | ||
| Transportation | 25 | ||
| Foreign currency translation adjustment | 1,574 | ||
| Balance December 31, 2025 | 33,339 | ||
| Mineral property interest: | |||
| Balance, December 31, 2025 | $ | 37,282 |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest (continued)
| Canada | |||
| British Columbia | |||
| New Polaris | |||
| (Note 7(a)(i)) | |||
| Acquisition Costs: | |||
| Balance, December 31, 2023 | $ | 3,927 | |
| Acquisition | 12 | ||
| Foreign currency translation adjustment | (18 | ) | |
| Balance, December 31, 2024 | 3,921 | ||
| Deferred Exploration Expenditures: | |||
| Balance, December 31, 2023 | 23,581 | ||
| Additions: | |||
| Exploration: | |||
| Assays and sampling | 60 | ||
| Community and social | 233 | ||
| Drilling | 1,183 | ||
| Environmental | 1,339 | ||
| Feasibility | 1,310 | ||
| Field, camp, supplies | 535 | ||
| General, administrative, sundry | 46 | ||
| Local labour | 175 | ||
| Machinery and equipment | 62 | ||
| Metallurgy | 38 | ||
| Recovery of taxes | (133 | ) | |
| Rental and storage | 61 | ||
| Salaries | 698 | ||
| Transportation | 597 | ||
| Utilities | 4 | ||
| Foreign currency translation adjustment | (2,410 | ) | |
| Balance December 31, 2024 | 27,379 | ||
| Mineral property interest: | |||
| Balance, December 31, 2024 | $ | 31,300 |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest (continued)
(a) Canada:
(i) New Polaris (British Columbia):
The New Polaris property, which is located in the Atlin Mining Division, British Columbia, is 100% owned by the Company subject to a 15% net profit interest which may be reduced to a 10% net profit interest within one year of commercial production by issuing 150,000 common shares. The Company is currently disputing the net profit interest. Acquisition costs at December 31, 2025 include a reclamation bond for $219,000 (2024 - $209,000).
(ii) Windfall Hills (British Columbia):
The Company owns 100% undivided interests in two adjacent gold properties (Uduk Lake and Dunn properties) located in British Columbia. The Uduk Lake properties are subject to a 1.5% NSR production royalty that can be purchased for CAD$1 million and another 3% NSR production royalty. The Dunn properties are subject to a 2% NSR royalty which can be reduced to 1% NSR royalty for $500,000. During the year ended December 31, 2023, the Company impaired the property to $Nil as the Company currently does not have any planned or budgeted expenditures for the property.
(b) United States:
(i) Fondaway Canyon (Nevada):
On March 20, 2017, the Company closed the Membership Interest Purchase Agreement with AIM (the "Membership Agreement") whereby the Company acquired 100% legal and beneficial interests in mineral properties located in Nevada, Idaho and Utah (USA) for a total cash purchase price of $2 million in cash and honouring pre-existing NSRs. Certain of the mineral properties are subject to royalties. For the Fondaway Canyon project, it bears both a 3% NSR and a 2% NSR. The 3% NSR has a buyout provision for an original amount of $600,000 which is subject to advance royalty payments of $35,000 per year by July 15th of each year until a gross total of $600,000 has been paid at which time the NSR is bought. A balance of $425,000 with a fair value of $183,000 was outstanding upon the closing of the Membership Agreement; a balance of $Nil remained payable as at December 31, 2023. The 2% NSR has a buyout provision of either $2 million in cash or 19.99% interest of a public entity which owns AIM if AIM were to close an initial public offering of at least $5 million.
On October 16, 2019, the Company signed a binding Letter Agreement with Getchell Gold Corp. ("Getchell") which was later superseded by the Option Agreement for the Acquisition of Fondaway Canyon and Dixie Comstock Properties on January 3, 2020, whereby Getchell has an option for four years to acquire 100% of the Fondaway Canyon and Dixie Comstock properties located in Churchill County, Nevada (both subject to a 2% NSR) for $4 million in total compensation to the Company, comprised of $2 million in cash and $2 million in shares of Getchell. Payment terms by Getchell are as follows:
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest (continued)
(b) United States: (continued)
(i) Fondaway Canyon (Nevada): (continued)
| Cash | US$ equivalent in | |||||||||
| Getchell Shares | ||||||||||
| At signing of agreement | $ | 100 | (received in 2020 | ) | $ | 100 | (received in 2020 with fair value of $104,600) | |||
| 1st anniversary | 100 | (received in 2020 | ) | 200 | (received in 2020 with fair value of $208,400) | |||||
| 2nd anniversary | 100 | (received in 2021 | ) | 300 | (received in 2021 with fair value of $259,000) | |||||
| 3rd anniversary | 100 | (received in 2022 | ) | 400 | (received in 2022 with fair value of $376,000) | |||||
| 4th anniversary | 1,600 | (received in 2023 | ) | 1,000 | (received in 2023 with fair value of $1,192,000) | |||||
| $ | 2,000 | $ | 2,000 |
The option includes minimum annual work commitments of $1.45 million on the properties. Getchell must also honor the pre-existing NSR and advance royalty commitments related to the properties, and grant the Company a 2% NSR on the Fondaway Canyon and Dixie Comstock properties of which half (1%) can be bought for $1 million per property.
On December 29, 2023, Getchell exercised the option to acquire the Fondaway Canyon and Dixie Comstock. The Company recorded a gain of $738,000 in the 2023 Consolidated statement of comprehensive loss.
(ii) Corral Canyon (Nevada):
In 2018, the Company staked various mining claims in Nevada, USA. During the year ended December 31, 2023, the Company impaired the property to $Nil as the Company currently does not have any planned or budgeted expenditures for the property.
(iii) Silver King (Nevada):
In October 2018, the Company entered into a property option agreement for its Silver King property with Brownstone Ventures (US) Inc. ("Brownstone"), a subsidiary of Nevada King Gold Corp, whereby Brownstone has an option to earn a 100% undivided interest by paying $240,000 in cash over a 10 year period with early option exercise payment of $120,000. The Company will retain a 2% NSR of which a 1% NSR can be acquired by Brownstone for $1 million. The Company received $12,000 cash in 2025 (2024 - $12,000) which was recognized as mineral property option income.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest (continued)
(b) United States: (continued)
(iv) Lightning Tree (Idaho):
On September 10, 2020, the Company entered into an option agreement in the form of a definitive mineral property purchase agreement for its Lightning Tree property located in Lemhi County, Idaho, with Ophir Gold Corp. ("Ophir"), whereby Ophir shall acquire a 100% undivided interest in the property. In order to acquire the property, over a three-year period, Ophir shall pay to the Company a total of CAD$137,500 in cash over a three-year period and issue 2.5 million common shares and 2.5 million warrants over a two-year period, and shall incur aggregate exploration expenditures of at least $4 million over a three-year period. The Company will retain a 2.5% NSR of which a 1% NSR can be acquired by Ophir for CAD$1 million. If Ophir fails to file a NI 43-101 compliant resource on the Lightning Tree property within three years, the property will not be conveyed to Ophir. In August 2022, the Company received CAD$50,000 cash (2021 - CAD$25,000 cash). In 2021, the Company received 1.25 million shares with a fair value of $159,600 and 1.25 million warrants with a fair value of $5,000, all of which were recognized as mineral property option income. In Q3 2023, the Company and Ophir mutually agreed to terminate the September 10, 2020 agreement, and the property was returned to the Company.
(v) Hot Springs Point (Nevada):
In July 2022, the Company entered into a Real Estate Purchase and Sale Agreement for the Hot Springs Point property located in Eureka County, Nevada, with a third party (the "Purchaser"), whereby the Purchaser acquired a 100% interest for $480,000 (received). The Purchaser also grants a 3% NSR to the Company. The entire amount received was recognized in 2022 in mineral property option income as a gain as Hot Springs book value on acquisition day by the Company was $nil; Hot Springs being incidental to the Fondaway Canyon property when they were acquired together.
These amounts may be reduced in the future as the Company determines which mineral property interests to continue to explore and which to abandon.
(d) Title to mineral property interests:
The Company has diligently investigated rights of ownership of all of its mineral property interests/ concessions and, to the best of its knowledge, all agreements relating to such ownership rights are in good standing. However, all properties and concessions may be subject to prior claims, agreements or transfers, and rights of ownership may be affected by undetected defects.
(e) Realization of assets:
The Company's investment in and expenditures on its mineral property interests comprise a significant portion of the Company's assets. Realization of the Company's investment in these assets is dependent on establishing legal ownership of the mineral properties, on the attainment of successful commercial production or from the proceeds of their disposal. The recoverability of the amounts shown for mineral property interests is dependent upon the existence of reserves, the ability of the Company to obtain necessary financing to complete the development of the properties, and upon future profitable production or proceeds from the disposition thereof.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
7. Mineral Property Interest (continued)
(f) Environmental:
Environmental legislation is becoming increasingly stringent and costs and expenses of regulatory compliance are increasing. The impact of new and future environmental legislation of the Company's operation may cause additional expenses and restrictions.
If the restrictions adversely affect the scope of exploration and development on the mineral properties, the potential for production on the property may be diminished or negated.
The Company is subject to the laws and regulations relating to environmental matters in all jurisdictions in which it operates, including provisions relating to property reclamation, discharge of hazardous materials and other matters. The Company may also be held liable should environmental problems be discovered that were caused by former owners and operators of its current properties and former properties in which it has previously had an interest. The Company is not aware of any existing environmental problems related to any of its current or former mineral property interests that may result in material liability to the Company.
8. Equipment
| Leasehold | Office Furnishings | Right of Use | ||||||||||
| Improvements | and Equipment | Asset | Total | |||||||||
| Cost: | ||||||||||||
| Balance, December 31, 2023 | $ | 119 | $ | 67 | $ | 281 | $ | 467 | ||||
| Foreign currency translation adjustment | (10 | ) | (5 | ) | (32 | ) | (47 | ) | ||||
| Balance, December 31, 2024 | 109 | 62 | 249 | 420 | ||||||||
| Foreign currency translation adjustment | 6 | 3 | 18 | 27 | ||||||||
| Balance, December 31, 2025 | 115 | 65 | 267 | 447 | ||||||||
| Accumulated amortization: | ||||||||||||
| Balance, December 31, 2023 | 32 | 61 | 77 | 170 | ||||||||
| Amortization | 23 | 5 | 53 | 81 | ||||||||
| Foreign currency translation adjustment | (4 | ) | (7 | ) | (17 | ) | (28 | ) | ||||
| Balance, December 31, 2024 | 51 | 59 | 113 | 223 | ||||||||
| Amortization | 23 | 1 | 52 | 76 | ||||||||
| Foreign currency translation adjustment | 3 | 4 | 12 | 19 | ||||||||
| Balance, December 31, 2025 | 77 | 64 | 177 | 318 | ||||||||
| Net book value: | ||||||||||||
| Balance, December 31, 2024 | $ | 58 | $ | 3 | $ | 136 | $ | 197 | ||||
| Balance, December 31, 2025 | $ | 38 | $ | 1 | $ | 90 | $ | 129 | ||||
The Company has a lease agreement for its headquarter office space in Vancouver, British Columbia. Its office lease term ended in July 2022 and a new office lease term started in September 2022 for a different office. The lease was set up as a right-of-use asset under the IFRS rules and 6.60% discount rate was used.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
9. Liabilities
(a) Flow Through Premium Liability
On March 28, 2024, the Company closed a private placement for 15.7 million flow through common shares at CAD$0.2625 per share for gross proceeds of CAD$4.1 million. The fair value of the shares on March 28, 2024 was CAD$0.24 per share, resulting in the recognition of a flow through premium liability of CAD$0.0225 per share for a total of CAD$353,000.
On March 4, 2025, the Company closed a private placement for 9,200,000 flow through common shares at a price of CAD$0.35 per share for gross proceeds of CAD$3.2 million. The fair value of the shares on March 4, 2025 was CAD$0.34 per share, resulting in the recognition of a flow through premium liability of CAD$0.01 per share for a total of CAD$92,000.
On August 18, 2025, the Company closed a private placement for 4,651,163 flow through common shares at a price of CAD$0.43 per share for gross proceeds of CAD$2 million. The fair value of the shares on August 18, 2025 was CAD$0.39 per share, resulting in the recognition of a flow through premium liability of CAD$0.04 per share for a total of CAD$186,047
| Balance, December 31, 2023 | $ | - | |
| Add: | |||
| Excess of subscription price over fair value of flow through common shares | $ | 261 | |
| Foreign currency translation adjustment | (3 | ) | |
| Less: | |||
| Income tax recovery | (258 | ) | |
| Balance, December 31, 2024 | - | ||
| Add: | |||
| Excess of subscription price over fair value of flow through common shares | $ | 199 | |
| Foreign currency translation adjustment | 1 | ||
| Less: | |||
| Income tax recovery | (148 | ) | |
| Balance, December 31, 2025 | 52 |
The Company has a remaining obligation to incur $560,000 qualified expenditures as at December 31, 2025 (2024 - NIL).
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
9. Liabilities (continued)
(b) Deferred Royalty Liability
The 3% NSR for the Fondaway Canyon project (Note 7(b)(i)) has a buyout provision for an original amount of $600,000. The buyout amount is subject to advance royalty payments of $35,000 per year by July 15th of each year until the full gross total of $600,000 has been paid. The remaining balance was $425,000 at the closing of the Membership Agreement in March 2017. The $425,000 was discounted to a fair value of $183,000 in 2017 using a discount rate of 18%. The liability was accreted over time as follows:
| Balance, December 31, 2022 | 131 | ||
| Add: | |||
| Accretion | 22 | ||
| Less: | |||
| Advance royalty payment | (35 | ) | |
| Sale of investment (1) | (118 | ) | |
| Balance, December 31, 2023, 2024, and 2025 | $ | - | |
| Current portion | $ | - | |
| Long term portion | - |
(1) Getchell exercised the option to acquire the Fondaway Canyon property on December 29, 2023. As such, the Company derecognized the deferred royalty liability from its books.
(c) Lease Liability
The continuity of the lease liability for the years ended December 30, 2025 and 2024 is as follows:
| Balance, December 31, 2023 | $ | 215 | |
| Add: | |||
| Interest | 12 | ||
| Foreign currency translation | (15 | ) | |
| Less: | |||
| Payments | (62 | ) | |
| Balance, December 31, 2024 | $ | 150 | |
| Add: | |||
| Interest | 9 | ||
| Foreign currency translation | 5 | ||
| Less: | |||
| Payments | (62 | ) | |
| Balance, September 30, 2025 | $ | 102 | |
| Current portion | 62 | ||
| Long term portion | 40 | ||
| Balance, December 31, 2025 | $ | 102 | |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
10. Share Capital
(a) Authorized:
The authorized share capital of the Company is comprised of an unlimited number of common shares without par value.
(b) Issued:
(i) On August 21, 2025, the Company converted 129,990 vested restricted share units ("RSUs") into common shares and issued 129,990 common shares to the officers of the Company.
(ii) On August 18, 2025, the Company closed a private placement for 4,651,163 flow through common shares at a price of CAD$0.43 per share for gross proceeds of CAD$2 million. The fair value of the shares on August 18, 2025 was CAD$0.39 per share, resulting in the recognition of a flow through premium liability of CAD$0.04 per share for a total of CAD$186,047.
(iii) On August 18, 2025, the Company closed a financing consisting of 5,128,205 shares at CAD $0.39 per share for aggregate gross proceeds of CAD $2 million
(iv) On April 22, 2025, the Company converted 360,645 vested RSUs into common shares and issued 360,645 common shares to the officers of the Company.
(v) On March 4, 2025, the Company closed a private placement for 9,200,000 flow through common shares at a price of CAD$0.35 per share for gross proceeds of CAD$3.2 million. The fair value of the shares on March 4, 2025 was CAD$0.34 per share, resulting in the recognition of a flow through premium liability of CAD$0.01 per share for a total of CAD$92,000.
(vi) On May 29, 2024, the Company converted 906,302 vested RSUs into common shares and issued 906,302 common shares to the officers of the Company.
(vii) On March 28, 2024, the Company closed a private placement for 15.7 million flow through common shares at CAD$0.2625 per share for gross proceeds of CAD$4.1 million. The fair value of the shares was CAD$0.24 per share, resulting in the recognition of a flow through premium liability of CAD$0.0225 per share for a total of CAD$353,000.
(viii) On July 28, 2023, the Company closed a financing consisting of 21,000,000 shares at CAD $0.21 per share for aggregate gross proceeds of CAD $4.4 million.
(c) Omnibus incentive plan:
The Company has an omnibus incentive compensation plan implemented in 2023. Pursuant to the omnibus plan, at December 31, 2025, the Company currently has 3,396,570 shares listed and reserved under the plan for stock option activities, 10,000,000 shares for restricted share units grants, 5,000,000 shares for deferred share units grants and 1,000,000 Shares for performance share units grants. The Plan, together with all security-based compensation arrangements of the Company, has an aggregate maximum number of shares that can be reserved for issuance equal to 10% of the number of shares issued and outstanding, from time to time.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
10. Share Capital (continued)
(c) Omnibus incentive plan: (continued)
i) Stock Options:
The continuity of outstanding stock options for the year ended December 31, 2025, 2024, and 2023 is as follows:
| Weighted | ||||||
| average | ||||||
| exercise | ||||||
| Number | price | |||||
| of Shares | (CAD$) | |||||
| Outstanding balance, December 31, 2022 | 2,235,000 | $ | 0.49 | |||
| Cancelled and expired during 2023 | (1,335,000 | ) | $ | 0.49 | ||
| Outstanding balance, at December 31, 2023 | 900,000 | $ | 0.50 | |||
| Expired during 2024 | (40,000 | ) | $ | 0.30 | ||
| Outstanding balance, at December 31, 2024 | 860,000 | $ | 0.51 | |||
| Expired during 2025 | (60,000 | ) | $ | 0.50 | ||
| Outstanding balance, at December 31, 2025 | 800,000 | $ | 0.51 | |||
| Exercise price range | $ | 0.50 - $0.52 |
The following table summarizes information about stock options exercisable and outstanding at December 31, 2025:
| Weighted | Weighted | ||||||||||
| Average | Average | ||||||||||
| Exercise | Number | Remaining | Exercise | ||||||||
| Prices | Outstanding at | Contractual Life | Prices | ||||||||
| (CAD$) | 31-Dec-25 | (Number of Years) | (CAD$) | ||||||||
| $ | 0.50 | 300,000 | 0.48 | $ | 0.50 | ||||||
| $ | 0.52 | 500,000 | 0.53 | $ | 0.52 | ||||||
| 800,000 | 0.50 | $ | 0.51 |
No stock options were granted during the years ended December 31, 2025, 2024, and 2022. As a result of no grants, no stock options related share based compensation was recorded for these years.
ii) Performance share units
No performance share units (PSUs) were granted during the years ended December 31, 2025, 2024 and 2023. Total PSUs available for granting are 1,000,000.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
10. Share Capital (continued)
(c) Omnibus incentive plan: (continued)
iii) Restricted share units
There are 9,412,503 restricted share units ("RSUs") available for granting under the Omnibus plan as at December 31, 2025.
459, 096 RSUs were granted to the officers of the Company during the year ended December 31, 2025. The share price on grant date was CAD $0.38. These RSUs vest over a period of one year. During the year ended December 31, 2025, 490,635 vested RSUs were converted to common shares and 58,483 RSUs were cancelled.
222,598 RSUs were granted to the officers of the Company during the year ended December 31, 2024. The share price on grant date was CAD $0.30. These RSUs vest over a period of one year.
1,600,000 RSUs were granted to the officers of the Company during the year ended December 31, 2023. The share price on grant date was CAD $0.230. These RSUs vest over a period of two years. During the year ended December 31, 2024, 906,302 vested RSUs were converted to common shares and 238,776 RSUs were cancelled.
For accounting purposes, the Company amortizes the share-based compensation expense over the vesting period. The Company recognized a share-based compensation expense of $146,000 for the year ended December 31, 2025 (2024 - $108,347 and 2023 - $152,069).
The following is the RSUs continuity schedule as of December 31, 2025:
| Balance December 31, 2022 | - | ||
| RSUs granted | 1,600,000 | ||
| Balance December 31, 2023 | 1,600,000 | ||
| RSUs granted | 222,598 | ||
| RSUs vested and converted to shares | (906,302 | ) | |
| RSUs cancelled | (238,776 | ) | |
| Balance December 31,2024 | 677,520 | ||
| RSUs granted | 459,096 | ||
| RSUs vested and converted to shares | (490,635 | ) | |
| RSUs cancelled | (58,484 | ) | |
| Balance December 31, 2025 | 587,497 |
iv) Deferred share units
There are 2,392,063 available deferred share units ("DSUs") under the Omnibus plan as at December 31, 2025.
438,425 DSUs were granted to the directors of the Company during the year ended December 31, 2025 (share price on grant date was CAD $0.49).
632,257 DSUs were granted to the directors of the Company during the year ended December 31, 2024 (share price on grant date was CAD $0.30).
1,537,255 DSUs were granted to the directors of the Company during the year ended December 31, 2023 (share price on grant date was CAD $0.23).
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
10. Share Capital (continued)
(c) Omnibus incentive plan: (continued)
These granted DSUs vested immediately, the Company accounts initially, based on the share price of the Company on the grant date, for a share-based compensation expense of and a corresponding share-based compensation liability. At each period end, the Company revalues the value of the outstanding DSUs to current market share price of the Company and adjusts accordingly the share based compensation and deferred compensation liability. For the year ended December 31, 2025 the Company recognized a share based compensation of $405,000 (December 31, 2024 - $207,844 December 31, 2023 - $244,000) in connection with DSUs grants and revaluation of the outstanding DSUs to market value.
The following is the DSUs continuity schedule as of December 31, 2025:
| DSUs outstanding | Deferred compensation liability at year end |
|||||
| Balance December 31, 2022 | - | - | ||||
| DSUs granted in 2023 | 1,537,255 | - | ||||
| Balance December 31, 2023 | 1,537,255 | 244,000 | ||||
| DSUs granted in 2024 | 632,257 | |||||
| Balance December 31, 2024 | 2,169,512 | 422,000 | ||||
| DSUs granted in 2025 | 438,425 | |||||
| Balance December 31, 2025 | 2,607,937 | 856,000 |
There were no conversions of DSUs to shares or cancelation of DSUs during the years ended December 31,2025, 2024 and 2023.
During the years ended December 31, 2025 and 2024 the Company had no warrants issued, expired or exercised.
During the year ended December 31, 2023, the Company had the following warrant activity:
| Exercise Prices (CAD$) |
Expiry Dates | Outstanding at December 31, 2022 |
Issued | Exercised | Expired | Outstanding at December 31, 2023 |
| $0.75 | October 28, 2023 | 638,510 | - | - | 638,510 | - |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
11. General and Administrative
| Years ended December 31 | |||||||||
| 2025 | 2024 | 2023 | |||||||
| Corporate Development | |||||||||
| Salaries and remuneration | $ | 44 | $ | 39 | $ | 33 | |||
| Sundry | 18 | - | 7 | ||||||
| Travel and conferences | 65 | 87 | 112 | ||||||
| $ | 127 | $ | 126 | $ | 152 | ||||
| General and Administrative: | |||||||||
| Accounting and audit | $ | 116 | $ | 90 | $ | 67 | |||
| Legal | 43 | 13 | 38 | ||||||
| Office and sundry | 105 | 156 | 141 | ||||||
| Properties related expenses and taxes | 43 | 51 | - | ||||||
| Regulatory | 75 | 68 | 71 | ||||||
| Rent | 45 | 59 | 52 | ||||||
| Travel | 51 | 21 | 34 | ||||||
| $ | 478 | $ | 458 | $ | 403 | ||||
12. Related Party Transactions
Key management includes directors (executive and non-executive) and senior management. The compensation paid or payable to key management is disclosed in the table below.
Except as disclosed elsewhere in the consolidated financial statements, the Company had the following general and administrative costs with related parties during the years ended December 31, 2025, 2024 and 2023:
| Net balance receivable (payable) | |||||||||||||||
| Years ended December 31, | as at December 31, | ||||||||||||||
| 2025 | 2024 | 2023 | 2025 | 2024 | |||||||||||
| Key management compensation: | |||||||||||||||
| Executive salaries and remuneration (1) | $ | 785 | $ | 833 | $ | 803 | $ | (11 | ) | $ | (13 | ) | |||
| Severance | - | - | 73 | - | - | ||||||||||
| Directors fees | 83 | 85 | 86 | (42 | ) | (27 | ) | ||||||||
| Share-based payments | 551 | 316 | 391 | - | - | ||||||||||
| $ | 1,419 | $ | 1,234 | $ | 1,353 | $ | (53 | ) | $ | (40 | ) | ||||
(1) Includes key management compensation which is included in employee and director remuneration, mineral property interests, and corporate development.
As of December 31, 2025, Sun Valley Investments AG ("Sun Valley") owned 48% common shares of the Company. During the year ended December 31, 2025, the Company received from and provided to Sun Valley corporate and technical related services. The Company incurred $24,000 (2024 - $112,000) in expenses and charged $54,000 (2024 - $40,000) to Sun Valley for services and reimbursements. The 2024 and 2025 amounts are outstanding at year end December 31, 2025, for a net amount of $42,000 due to Sun Valley.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
13. Segment Disclosures
The Company has one operating segment, being mineral exploration. As at December 31, 2025 and 2024 all of the Company's non-current assets were located in Canada.
14. Commitment
In January 2022, the Company entered into an office lease arrangement for a term of five years with a commencement date of September 1, 2022. The basic rent per year is CAD$84,700 for years 1 to 2, CAD$87,300 for years 3 to 4, and CAD$89,900 for year 5. As at December 31, 2025, the Company is committed to the following payments for base rent at its corporate head office in Vancouver, BC, as follows:
| Amount | |||
| (CAD$000) | |||
| Year: | |||
| 2026 | $ | 88 | |
| 2027 | $ | 60 | |
| $ | 148 |
15. Taxes
The Company is subject to corporate income taxes and other provincial and federal mining and sales taxes. There is a $65,000 receivables amount reported on the Statement of Financial Position of the Company comprised of taxes receivable from the Canadian tax authorities (federal GST credits). Although the Company has been successful in the past with applications for these credits, there is a risk that the tax claims may be denied or reduced by the tax authorities. As of December 31, 2025, the Company has a deferred tax liability of $2.3 million, resulting mainly from timing difference between the accounting and tax values of the mineral properties expenditures.
Income taxes
A reconciliation of income taxes at statutory rates with the reported taxes is as follows:
| 2025 | 2024 | 2023 | |||||||
| Loss for the year | $ | (1,611 | ) | $ | (1,125 | ) | $ | (3,097 | ) |
| Expected income tax (recovery) | $ | (435 | ) | $ | (304 | ) | $ | (836 | ) |
| Change in statutory, foreign tax, foreign exchange rates and other | (90 | ) | 131 | (178 | ) | ||||
| Permanent difference | 136 | 105 | 146 | ||||||
| Share issue cost | (11 | ) | (7 | ) | (3 | ) | |||
| Adjustment to prior years provision versus statutory tax returns | 1,006 | (140 | ) | 476 | |||||
| Change in unrecognized deductible temporary differences | 377 | 215 | 395 | ||||||
| Total income tax expense (recovery) | $ | 983 | $ | - | $ | - | |||
| Current income tax | $ | - | $ | - | |||||
| Deferred tax expense | $ | 983 | $ | - |
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
15. Taxes (continued)
Income taxes (continued)
The significant components of the Company's deferred tax assets and liabilities are as follows:
| 2025 | 2024 | 2023 | |||||||
| Deferred Tax Assets (liabilities) | |||||||||
| Mineral property interests | $ | (4,236 | ) | $ | (2,651 | ) | $ | (1,881 | ) |
| Equipment | 128 | 106 | 115 | ||||||
| Non-capital losses | 1,797 | 1,280 | 389 | ||||||
| Net deferred tax liability | $ | (2,311 | ) | $ | (1,265 | ) | $ | (1,377 | ) |
The significant components of the Company's temporary differences, unused tax credits and unused tax losses that have not been included on the consolidated statement of financial position are as follows:
| 2025 | Expiry Date Range | 2024 | Expiry Date Range | 2023 | Expiry Date Range | |||||||||||||
| Temporary Differences | ||||||||||||||||||
| Mineral property interests | $ | 3,363 | No expiry date | $ | 3,217 | No expiry date | $ | 3,667 | No expiry date | |||||||||
| Equipment | 936 | No expiry date | 854 | No expiry date | 888 | No expiry date | ||||||||||||
| Lease liability | 102 | No expiry date | 150 | No expiry date | 215 | No expiry date | ||||||||||||
| Share issue costs | 93 | 2046 to 2049 | 175 | 2045 to 2048 | 297 | 2044 to 2047 | ||||||||||||
| Marketable securities | 1,073 | No expiry date | 1,022 | No expiry date | 916 | No expiry date | ||||||||||||
| Allowable capital losses and other | 187 | No expiry date | 105 | No expiry date | 87 | No expiry date | ||||||||||||
| Non-capital losses available for future period | 14,633 | See below | 13,708 | See below | 13,067 | See below | ||||||||||||
| Canada | 14,343 | 2030 to 2045 | 12,278 | 2030 to 2044 | 12,653 | 2030 to 2043 | ||||||||||||
| USA | 290 | No expiry date | 1,430 | No expiry date | 414 | No expiry date |
16. Subsequent events
In January 2026, 587,497 RSUs vested and converted to common shares.
On February 13, 2026 Canagold closed an offering for total proceeds of CAD$9,228,456.50 consisting of:
(i) 9,396,570 common shares at a price of CAD$0.45 per Common Share, and
(ii) 10,000,000 common shares that qualify as flow-through shares for the purposes at a price of CAD$0.50 per share
In February 2026, 462,128 RSUs were granted to the officers of the Company.
| Notes to the Consolidated Financial Statements For the Years ended December 31, 2025, 2024 and 2023 (tabular dollar amounts expressed in thousands of United States dollars, except per share amounts) |
HEAD OFFICE #1250 - 625 Howe Street
Vancouver, BC, Canada, V6C 2T6
Telephone: (604) 685-9700
Facsimile: (604) 685-9744
Website: www.canagoldresources.com
DIRECTORS Sofia Bianchi
Carmen Letton
Andrew Trow
Kadri Dagdelen
Michael Doyle
OFFICERS Catalin Kilofliski ~ Chief Executive Officer
Michael Doyle ~ Chief Technical Officer
Garry Biles ~ President and Chief Operating Officer
Mihai Draguleasa ~ Chief Financial Officer and Corporate Secretary
Colm Keogh ~ Vice President Operations
Chris Pharness ~ Vice President Sustainability and Permitting
Collen Middleton ~ Vice President Permitting & Compliance
REGISTRAR AND Computershare Investor Services Inc.
TRANSFER AGENT 3rd Floor, 510 Burrard Street
Vancouver, BC, Canada, V6C 3B9
AUDITORS Davidson & Company
1200-609 Granville Street
Vancouver, BC, Canada, V7Y 1G6
SOLICITORS AND McMillan LLP
REGISTERED OFFICE #1500 - 1055 West Georgia Street
Vancouver, BC, Canada, V6E 4N7
SHARES LISTED Trading Symbols
TSX: CCM
OTC-QB: CRCUF
DBFrankfurt: CAN